With reference to FIG. 2, the invention relates to an opposed stepped piston two-stroke engine comprising at least a first and a second cylinder, wherein the air piston is a stepped piston providing a first air transfer piston that expands and compresses a first air transfer volume to deliver air from the first air transfer volume to an air transfer system, and the exhaust piston is a stepped piston providing a second air transfer piston that expands and compresses a second air transfer volume to deliver air from the second air transfer volume to the air transfer system, each of the first and second air transfer volumes having an air inlet for receiving air; and wherein the air transfer system provides fluid connection between the respective first air transfer volume of each cylinder and the air port of another respective cylinder, via respective first air transfer conduits, and fluid connection between the respective second air transfer volume of each cylinder and the air port of the other respective cylinder, via respective second air transfer conduits, wherein the drive system is configured, for each cylinder, to have a predetermined phase angle such that one of the exhaust piston and air piston is driven before the other piston, causing delivery of air from its respective air transfer volume to the air transfer system before delivery of air occurs from the other of the air transfer volumes.