Vehicular drive system which is small-sized and/or improved in its fuel economy.A power distributing mechanism 16, which is provided with a differential-state switching device in the form of a switching clutch C0 and a switching brake B0, is switchable by the switching device between a differential state (continuously-variable shifting state) in which the mechanism is operable as an electrically controlled continuously variable transmission, and a fixed-speed-ratio shifting state in which the mechanism is operable as a transmission having a fixed speed ratio or ratios. The power distributing mechanism 16 is placed in the fixed-speed-ratio shifting state during a high-speed running of the vehicle or a high-speed operation of engine 8, so that the output of the engine 8 is transmitted to drive wheels 38 primarily through a mechanical power transmitting path, whereby fuel economy of the vehicle is improved owing to reduction of a loss of conversion of a mechanical energy into an electric energy. The mechanism 16 is also placed in the fixed-speed-ratio shifting state during a high-output operation of the engine 8, so that the required electric reaction of first electric motor M1 can be reduced, whereby the required size of the first electric motor M1, and the required size of the drive system 10 including the electric motor M1 can be reduced.