An approach for controlling a hydrostatic dynamometer for the hardware-in-the-loop (HIL) testing of hybrid vehicles is proposed and experimentally evaluated. The hydrostatic dynamometer, which is capable of absorbing and regenerating power, was specifically designed and built in-house to evaluate the fuel economy and control strategy of a hydraulic hybrid vehicle being developed. Unlike a chassis dynamometer whose inertia is similar to the inertia of the vehicle being tested, the inertia of this hydrostatic dynamometer is only 3% of the actual vehicle. While this makes the system low cost, compact, and flexible for testing vehicles with different weights and drag characteristics, control challenges result. In particular, the dynamometer must apply, in addition to the torques to mimic the wind and road drag, also the torques to mimic the acceleration and deceleration of the missing inertia. To avoid estimating the acceleration and deceleration, which would be a noncausal operation, a virtual vehicle concept is introduced. The virtual vehicle model generates, in response to the applied vehicle torque, a reference speed profile which represents the behavior of the actual vehicle if driven on the road. This reformulates the dynamometer control problem into one of enabling the actual vehicle dynamometer shaft to track the speed of the virtual vehicle, instead of directly applying a desired torque. To track the virtual vehicle speed, a controller with feedforward and feedback components is designed using an experimentally validated dynamic model of the dynamometer. The approach has been successfully tested on a power-split hydraulic hybrid vehicle with acceptable virtual vehicle speed and dynamometer torque tracking performance.