A hybrid power supply system for an engine is disclosed. The hybrid power supply system includes a sensing unit to generate a signal indicative of a speed of the engine and a controller to determine the speed of the engine based on the signal received from the sensing unit. The controller compares the speed of the engine with a predefined maximum idle speed, and cuts off a supply of fuel to the engine, when the speed of the engine is greater than or equal to the predefined maximum idle speed. The controller shuts off an inlet valve and an exhaust valve associated with a cylinder of the engine. The closure of the inlet valve and the exhaust valve allow compression and expansion of air within the cylinder during supply of a rotational power by a flywheel.