A four-stroke free-piston engine was simulated and tested to achieve energy conversion from fuel to electricity. Simulation models were created based on the kinetic equation of free-piston, the equation of gas state, and an equivalent heat release rate of combustion process. Dynamic properties of the system were analyzed by using the model. Effects of the compression ratio and the expansion ratio were discussed. Based on the results of the simulation, an experimental prototype was fabricated. Testing results of the prototype were analyzed, and performance parameters were given out in detail. The generating efficiency 34% was obtained up to now, and the efficiency 45% was available after optimization. According to the simulated and tested results, the new generating system has distinct advantages to conventional gasoline generators.