A total of 121,110 new cars were licensed during 2015, up 31.1% on the previous year.
New figures from the Central Statistics Office show that Volkswagen was the most popular brand of new car licensed last year.
A total of 15,016 VW cars were sold during the year, followed by Toyota (12,409), Ford (11,823), Nissan (10,843) and Hyundai (10,743).
Seen by some as a sign of an improving economy, the number of new goods vehicles sold during 2015 rose to 22,939 from 16,254 in 2014 - an increase of 41.1%.
The CSO noted that this rise is more than double in any of the years from 2010 to 2013.
However, the number of used, or imported, cars fell by 10.7% during the year
Today's figures also show that every county showed an increase in the number of new cars sold last year. Almost half of all new cars were sold in Dublin and Cork.
Seven out of every ten new cars licensed last year were diesel, the CSO noted.
The CSO figures also show that just 847 new cars were licensed in December, representing just 0.7% of all new private cars licensed during the year.
A total of 3,164 used cars were licensed last month, down 1.9% on the same time the previous year.
Commenting on the CSO car figures, Davy economist David McNamara said he sees no reason why the strong growth in 2015 will not continue this year.
He said that consumer confidence is now at a ten-year high with many in the December survey indicating a willingness to spend on big household purchases.
"Vehicle sales are still 21% below their 2007 peak, and strong population growth and high car usage suggest that car sales should trend back towards peak in the coming years as the economy recovers," he added.
