Villeneuve started out racing snowmobiles and he has continued to race in snowmobile events throughout his career. He moved into saloon racing in Canada, winning a Honda Civic series and many races from 1976 to 1978. He then stepped up to the open-wheeler Formula Ford category, and then Formula Atlantic, where he took Rookie of the Year in 1979, then consecutive titles in 1980 and 1981. He also won the World Championship Snowmobile Derby in 1980. At the end of 1981, he took a pair of drives for the Arrows Formula One team, but failed to qualify for the Canadian Grand Prix, or the Caesars Palace Grand Prix.