[Truncated abstract] Air pollution is increasingly perceived to be a serious intangible threat to humanity, with air quality continuing to deteriorate in most urban areas. The main sources of inner city pollution are motor vehicles, which generate emissions from the tail pipe as well as by evaporation. These contain toxic gaseous components which have adverse health effects. The major components are carbon monoxide (CO), nitrogen dioxide (NO2), nitric oxide (NO), sulphur dioxide (SO2), particulates (PM10), and volatile organic compounds (VOC). CO and oxides of nitrogen (NOx) are major emissions from cars. This study focuses on pollutant concentration in Perth city and has sought to develop measures to improve air quality. To estimate concentrations, the study develops air pollution models for CO and NOx; on the basis of the model estimates, effective policy is devised to improve the air quality by managing travel to the city. Two peaks, due to traffic, are observed in hourly CO and NOx concentrations. Unlike traffic, however, the morning peak does not reach the level of the afternoon peak. The reasons for this divergence are assessed and quantified. Separate causal models of hourly concentrations of CO and NOx explain their fluctuations accurately. They take account of the complex effects of the urban street canyon and winds in the city. The angle of incidence of the wind has significant impact on pollution level; a wind flow from the south-west increases pollution and wind from the north-east decreases it. The models have been shown to be equivalent to engineering and scientific models in estimating emission rate in the context of street canyons. However the study models are much more precise in the Perth context. ... The models are used to calculate the marginal effects for all attributes and elasticity for fuel price. In almost all attributes the non-work group is more responsive than the work group. Finally, the SP model results are integrated into an econometric model for the purpose of prediction. The travel behaviour prediction is used to estimate the policy impact on air quality. The benefit from the air quality improvement is reported in terms of life saved. The estimated relationships between probability of death and air pollution determines the number of lives that could be saved under various policy scenarios. A ratio of benefits to the financial and perceived sacrifices by drivers is calculated to compare the effectiveness of the suggested policies. A car size charge policy was found to be the most cost effective measure to ameliorate the environmental impact of cars in Perth, with a morning peak entry time charge being almost as cost effective. The study demonstrates the need for appropriate modelling of air pollution and travel behaviour. It brings together analytical methods at three levels of causality, vehicle to air pollution, charge to travel response, and air pollution to health.