With a De Dion-Bouton engine mounted on the back wheel, Peugeot created their first motorcycle in 1898. Although displayed at the 1898 Paris Exhibition, this model was never put into production. Although De Dion-Bouton actually made the majority of the tricycle, Peugeot did make one in 1898.

Peugeot began making quadricycles in 1900, but by 1903, production had ended due to a lack of demand. In 1901, Peugeot produced their own motorcycle using a Swiss-made Zürcher and Lüthi (ZL) engine, inspired by the popularity of the French-built Werner Brothers and Company Motobicyclette. The first of this kind, the Peugeot 500 M, a 500 cc (31 cu in) dual overhead camshaft model, debuted in 1914. Peugeot acquired Automoto, a forerunner in the motorcycle and scooter industries, in 1930. Up until the 1950s, Peugeot was the top French motorcycle manufacturer, producing a wide range of models.

Mahindra purchased a 51% controlling stake in the business in October 2014.

 PSA Group retained a 49% ownership stake in the business, as well as the right to use its logo.

Peugeot currently manufactures three-wheelers and scooters with 50- to 500-cc engines.

It runs two production facilities in Jinan, China, and Mandeure, France. 60 countries sell Peugeot scooters. 

In 2019, M&M subsequently purchased a 100% stake.