The Yukon Hybrid is GM's green alternative for those who need a full-size SUV and is a new offering for 2008. GM proudly and loudly proclaims it as the world's first full-size two-mode hybrid SUV. It can be had in two- or four-wheel drive.

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There is still a V8 engine underhood, though it's been modified to open its intake valve later . The 6.0 liter is good for 332 horsepower at 5,100 rpm and 367 lb-ft of torque at 4,100 rpm. Fuel economy numbers for the two-wheel drive SUV are 21 mpg in the city and 22 mpg on the highway, while the 4WD version manages 20 in either cycle, as estimated by the EPA. This compares favourably to an equivalent 2WD Tahoe with a gas engine only, which is rated at 14 mpg city and 20 mpg highway. Towing capability is rated at a maximum of 6,200 lbs for the 2WD and 6,000 lbs for the 4WD model.
The gasoline engine utilizes GM's Active Fuel Management technology to shut down four cylinders when less power is needed as well. Then there is a 300 volt battery pack that fits in the rear cargo area without intruding on passenger space. That battery pack also runs the air-conditioning and power steering, as the truck is capable of moving without the big V8 being lit thanks to two 60KW (or 80 hp) motors that power the wheels. The motors are integrated into what looks like a four-speed automatic transmission, but is actually a continuously variable set-up, although it does have four fixed ratios when the gas engine is needed to charge the batteries.
In addition to all the high-tech gadgets, GM engineers saved gas the old-fashioned way: by putting the Yukon Hybrid on a diet. They managed to shave about 350 lbs by using lighter wheels and seats, a smaller battery, an aluminum hood, liftgate, front bumper beam, shaft and engine and eliminating the starter motor. The aerodynamics were also improved via the use of some unqiue body components.

Standard content includes 8-passenger seating, leather 6-way power and heated front seats, a navigation system integrated into the sound system with a rearview camera, tri-zone air conditioning, one year of OnStar, stability control and traction control and 18-inch wheels, among others.