The Kyoto Protocol came into force in February 2005. Accordingly, the Japanese Government has been obligated to reduce carbon dioxide emissions by 6% against 1990 levels. The government estimates that carbon dioxide emissions in the transport sector account for 22% of all those in Japan; they have increased by 20.3% during 1990-2003 under increased motorization. To achieve reduction targets, the government released “Outline for Promotion Effects to Prevent Global Warming” in June 1998 and proposed urgent countermeasures against global warming. The outline was revised in March 2002, with more than 100 measures and policies proposed by ministries and agencies. The outline emphasized the establishment of an effective transportation system to achieve a quantified emission limitation of carbon dioxide emission increase by 17% for 2010 against the level in 1990. Modal-shift policies for freight transportation have remained a major concern, both for governments and private companies. This study develops a simulation model to examine the effects of modal-shift policies on the reduction of carbon dioxide emissions from automotive freight transportation in Japan. Binary logit models are estimated to identify the choice behavior of regional freight transportation by railway, shipping, and automobiles. Subsequently, gravity models are used to estimate freight transportation among prefectures in Japan. Finally, carbon dioxide emissions are calculated using the standard physical unit proposed by the Ministry of Land, Infrastructure and Transport. The model has been applied to a hypothetical case in which the average rate of modal-shift will be increased by 50% over the levels reported in 2000. Results of this study reveal that a marked reduction in carbon dioxide emissions can be expected for freight transportation between metropolitan and rural regions. Results also underscore the importance of effective utilization of railway transportation networks and marine transportation networks, which are well developed in metropolitan regions. JEL Classification: Q54, R40, R41