In this paper, a model predictive control (MPC) approach is presented for solving the energy management problem in a parallel hydraulic hybrid vehicle. The hydraulic hybrid vehicle uses a variable displacement pump/motor combination to transfer energy between the mechanical and hydraulic domains and a high pressure accumulator for energy storage. The proposed controller observes the gas and brake pedal positions to estimate the desired wheel torque. It regulates the engine throttle command, pump/motor displacement, and applied brake force to track this desired torque while optimizing the powertrain efficiency. Simulation studies were conducted to evaluate the effects of engine dwell time and accumulator capacity versus on the overall vehicle fuel economy.