Embraced by Hollywood celebrities and beloved by environmentalists, the Prius has long been the envy of Toyota's rivals, but now its safety woes risk putting the brakes on the success of hybrid cars.
The crisis-hit Japanese auto giant is a pioneer in fuel-sipping hybrids, which run on a combination of petrol and electricity and are vital to the company's efforts to stay in pole position in fuel-efficient automobiles.
Toyota, whose edge in hybrid technology helped propel it past General Motors in 2008 to become the world's biggest automaker, has struggled to keep up with demand for the Prius in recent years.
But a software glitch with the braking system of its newest model now threatens to tarnish the image of petrol-electric cars, just as Toyota reels from massive worldwide recalls due to separate accelerator pedal trouble.
The Prius problem "is certainly giving hybrids a bad name, especially in the United States," said Koji Endo, an auto analyst at Advanced Research Japan.
"People who have never driven a Toyota hybrid and were considering buying one may stop and think, 'Wait a second'," he added.
Toyota said Friday that it was still considering whether to recall hundreds of thousands of Prius hybrids.
The Prius, which boasts a world-beating 38.0 kilometres per litre, or 50 miles per gallon, has been the most popular hybrid globally since the launch of the first version in 1997.
Known in the industry as the "intelligent" green car owing to its highly sophisticated electronics, nearly 1.5 million Prius vehicles had been sold in 40 countries as of August 31, cruising ahead of rival Honda's Insight hybrid.
Yet while Toyota leads the industry in terms of brand loyalty, the brake flaw could deter buyers at a time when interest in less-polluting automobiles is growing because of worries about global warming, Endo said.
Toyota, which acknowledged Friday it faced "a moment of crisis", has said it redesigned the anti-lock braking system (ABS) for the Prius in January and will soon announce steps for those already on the road.
It said there was sometimes a slight delay switching from regenerative braking - which captures the energy of a hybrid car's motion to recharge the battery - to the hydraulic brake on icy or bumpy roads.
It is a strong blow to Toyota, which has bet heavily on hybrids, in contrast to some competitors, such as Nissan, that see them as merely a passing fad on the road to pure electric vehicles.
Toyota produced 530,000 hybrids in 2009, spanning 15 models from sport utility vehicles to sedans, mini-vans and the luxury Lexus series.
It aims to boost annual output of the petrol-electric automobiles to about one million vehicles - a third of its total domestic output - within the next few years, said company spokesman Paul Nolasco.
But its lead may now be under threat as rivals seize on the opportunity to wrest back market share lost to Toyota during a global expansion drive that once seemed almost unstoppable.
US rivals General Motors and Ford were swift to launch sales campaigns to lure buyers away from the Japanese giant, whose brand has long been synonymous with safety and reliability.
With drivers becoming more environmentally aware, "it should have been a golden opportunity for Toyota to expand further at a time when green technology is in the limelight," said Mizuno Credit Advisory auto analyst Tatsuya Mizuno.
"Toyota appears to be throwing away the chance all by itself," he added.
Dozens of drivers in Japan and the United States have complained their Prius brake was slow to kick in, sometimes resulting in accidents.
"Since its 1997 first-generation Prius, the company has been focusing on cost-cutting efforts," said Takehiko Morozumi, an auto expert at the Tokudaiji Institute of Automotive Culture.
"Because it was too focused on permeating the market with the Prius, Toyota may not have paid enough attention to the tiny details for which it had been so famous," he added.
The Prius, however, is not the only hybrid with brake trouble. Ford said last week there was a problem affecting braking in some of its hybrid vehicles and offered a software fix.