In this study, the use of the oxygenated fuels in spark-ignition (SI) engines has been investigated by means of exergy analysis. For this purpose, a two-zone quasi-dimensional thermodynamic cycle model was used. The cycle model contains compression, combustion, and expansion processes. The combustion period is simulated as a turbulent flame propagation process. Intake and exhaust processes are computed by a simple approximation method. Principles of the second law of thermodynamics are applied to the cycle model to perform exergy analysis. Exergetic terms, such as exergy transfer with heat, exergy transfer with work, irreversibilities, thermomechanical exergy, fuel chemical exergy, and total exergy, were computed in exergy analysis. Additionally, distributions of fuel exergy, the energy-based (the first law) efficiency, and the exergetic (the second law) efficiency were calculated. The results showed that the oxygenated fuels are suitable from an exergy point of view because of less entropy production and less heat loss. On the other hand, these fuels cause reduction in work output and an increment in fuel consumption because of their lower calorific values and lower stoichiometric air/fuel ratios in comparison to isooctane. Irreversibilities for methanol and ethanol are lower by about 7.44 and 4.29%, respectively, than that of isooctane. Exergy transfer with heat decreases by about 9.47% for methanol and 6.45% for ethanol in comparison to isooctane. However, exergy transfer with work, i.e., useful work output, decreases by about 7.35 and 3.24% for methanol and ethanol, respectively. The brake-specific fuel consumptions for methanol and ethanol are higher, about 132.2 and 65.5%, respectively, in comparison to isooctane.