In truly sustainable energy systems, hydrogen and electricity will become the primary energy carriers with hydrogen being especially important for energy storage and transportation. Hydrogen may play a central role in the world’s future energy mix. A coherent hydrogen energy strategy should address energy supply and demand, taking into account all aspects of energy systems from production through utilization. The two main requirements for hydrogen economy development are: (1) Economically viable and environmentally benign indigenous sources for hydrogen, and (2) Hydrogen applications in both power generation and transportation sectors must be competitive with fossil hydrocarbons. Many technical, economical, social and policy challenges must be addressed. Despite the compelling benefits of implementing hydrogen economy, market penetration is not a seamless process and requires outlining major incentives and identifying major barriers. Careful analysis of barriers to hydrogen market entry would provide valuable insight into how available national and international resources should be allocated to achieve a fully developed hydrogen economy. Major barriers are capital investment requirements, lack of hydrogen fuelling infrastructure, and establishment of codes and standards for hydrogen systems. A coordinated and focused effort is required to bring the public and private sectors together to share the costs and capitalize on the benefits of a transition to a hydrogen economy. A tremendous commitment and coordination of available resources are essential to achieve this goal. Academia’s role is to conduct R&D in the hydrogen field, increase public awareness through education and training materials, and assure public acceptance of hydrogen use. Development of novel materials especially designed for hydrogen production, storage and utilization is of primary concern. Collaboration of central government, local and regional authorities, industry, and academia is absolutely essential for the development of a hydrogen economy, with each having a principal role in the development of the various market segments.