This article details the experiences of two California public transit agencies, Sacramento Regional Transit District (RT) and SunLine Transit Agency, which replaced aging diesel buses with new compressed natural gas (CNG) buses in 1994. It compares the operating characteristics and costs of 170 CNG buses (with the same engine-chassis configuration) and 73 diesel buses in service at the same time. Equipment was tested over a three-year period for a total of 22.2 million miles. The data indicate that labor, parts, and fuel for diesel equipment cost more than for CNG buses. Both agencies also achieved significant savings in hazardous waste disposal. The study indicates payback of the incremental costs of CNG equipment is realized in six to eight years, and that both communities benefit from public transits clean air leadership.