A few years ago the thought of a small car fitted with a diesel engine would have conjured up images of noise, smell and sluggishness.

Not any more. The Yaris, I have to say, proved to be a surprisingly able little runaround with capabilities which belied it's size.

Toyota has recently revamped and rebadged its already successful supermini to give it a sportier look and improved ride, and the list of specifications is impressive.

The top-end T Spirit grade brings 14-inch alloy wheels, power mirrors, steering wheel audio controls, front fog lamps, manual sunroof and air conditioning to add to the radio/CD player, electric windows, front and side airbags, remote control double locking, ABS brakes with EBD, power steering and three-point seatbelts on all seats boasted by lesser models.

But the real jewel in the crown of the test car was its D4D badging. This denotes a 1.4 litre common rail diesel engine producing 74bhp and returning a very impressive 64.2mpg on the combined cycle, making it Toyota's most frugal car.

I didn't quite manage this on a 250-mile round trip down the M62 and M6 because of roadworks queues, but I have no reason to doubt that figure. Toyota says the little diesel uses a specially developed turbo with air-to-air intercooler to boost power and torque while delivering low fuel consumption and emissions.

I found it very easy to live with. The diesel clatter on start-up was muted, and only under hard acceleration was it anything less than impressively quiet.

With a 0-62mph time of 12.9 sec it is no firebrand but perfectly adequate for normal driving conditions and it has a wide spread of pull.

At motorway speeds the engine was impressively quiet, although there was plenty of road and wind noise, and there was power on tap to keep up with the outside lane traffic. Top speed is a respectable 106mph.

On country roads the car was fun, with plenty of grip and a precise gearchange, while around town it was easy to drive and park, and that fuel economy should prove a real boon in the long run.

But the economy comes at a price, literally. Toyota lists the T Spirit 1.4D4D five-door at £11,313 on the road, £700 more than its 1.3 litre petrol-powered sibling.

The restyled Yaris looks fresh and modern from the outside, the front dominated by large headlamp clusters and a cheeky grille.

The car is tall, in supermini tradition, and inside that translates into a surprising amount of space. Front seat passengers are well catered for in both head and elbow room, and the rear seats slide forward to increase luggage space if required (it's pretty limited with them fully back).

The driving position is very upright, more like that of an MPV, and it took some getting used to but proved comfortable on a long journey. But the steering wheel only adjusts for height, not reach, and I found to get close enough to the wheel my shins were a bit too close to the dashboard storage shelves.

That said, the car was very easy to drive, with good visibility, reassuring brakes and a fine sense of stability even in poor driving conditions of high wind and lashing rain. The digital instrument cluster in a central pod might not be to all tastes, and although the speed readout was clear, the fuel gauge and rev counter required too long a look to take in the information while driving at speed.

Oddment storage was excellent and the air con a plus, although I found the CD/radio controls a bit fiddly.

All in all, the little Toyota is a clever package for a family car of such small external dimensions, and the low fuel consumption of the diesel combined with Toyota's legendary reliability should make it a sound buy - if you are prepared to fork out the initial extra £700 for the D4D badge.

Updated: 09:18 Friday, February 20, 2004