Looney Tunes Racing features different power-ups that are slightly unusual for the genre—instead of random pickups as in most racing games, racers collect tokens of various colors which are used to charge various power-ups. Six power-ups are available, and only the current level power-up may be activated. Also available are environmental hazards, triggered by driving through an 'ACME gag-activation arch', generally aimed further ahead on the track. Looney Tunes Racing features nineteen characters (six default characters and thirteen unlockable characters).
Looney Tunes Racing also features a unique soundtrack where the in-game music is randomly arranged using separate, randomized parts of each song in a three-segment pattern: A-A-B (segment A played twice and segment B played once, although some tracks like Desert Dash play the A segment once). Special segments are also played whenever the player goes uphill or downhill, runs over a boost pad, takes or loses the lead, and wins or loses a race.