Automatic guided vehicle system for guiding a driverless vehicle over a predetermined path of travel without any tracks, wires or the like. The vehicle is provided with an active optical navigation section for determining vehicle position and bearing by scanning plural beacons distributed within the zone of travel of the vehicle, a passive ground navigation section including a gyrocompass for measuring changes in bearing of the vehicle and a wheel encoder for measuring distance traveled by the vehicle's steering wheel. Memory onboard the vehicle contains a series of path vectors which define a predetermined path of travel for the vehicle. The ground navigation section updates vehicle position and bearing as determined by the optical navigation section. A programmed onboard computer includes driver software for generating steering data so as to guide the vehicle over a corrective arc path from its position and bearing as determined by the navigation sections to the desired position and bearing as indicated by a stored path vector.