Iranian industries are increasingly concerned with sustainable development by controlling their impacts on environment. Iranian automotive industries have began conducting environmental management within a structured management system based on ISO 14001 international standard since 1997. Iran Khodro Co. (IKCO), the largest Iranian automotive manufacturer, implemented EMS entire the company in 2000. IKCO have found that environmental audits carried out within EMS are non sufficient to provide management of the organization with reliable and verifiable information on organization’s environmental performance trend. Therefore, it decided using Environmental Performance Evaluation (EPE) for mentioned purpose. To begin EPE process, EPE scope was determined entire IKCO and EPE period was considered 2002–2004. Then, EPE process of IKCO followed the steps as selecting Environmental Performance Indicators (EPIs), collecting data relevant to the selected indicators, analyzing and converting data into information describing environmental performance and assessing information in comparison with the Environmental Performance Criteria (EPCs). Tracking IKCO’s environmental performance trend over EPE period indicates that considerable progress has been made regarding decreased water, electricity, natural gas and compressed air consumption as well as waste water generation. The results of EPE have also helped to identify several effective measures for further improvement, e.g. environmental training performance and investments for environmental projects. EPE helped IKCO to verify the areas to which the environmental programs within IKCO’s EMS had advanced. Furthermore, EPE gave a good idea for providing a basis for any corrective actions in areas which have not made considerable progress or shown deficiency. However, IKCO’s environmental performance evaluation is still in its early stages. It is necessary reviewing the EPE process for improvement to conform the appropriateness of the selected EPIs, relevance of EPCs, reliability of data collected, comparability of data between years and companies, etc.