History
The first small two-strokes were powered by a mixture of regular gasoline and castor oil, which was used for lubrication of the internal parts.
Racing
Early high-performance radio controlled cars used alcohol (or its cousin methanol) as fuel. Modern racing engines use a mixture of nitromethane, methanol and castor oil.
Aircraft
There is some debate as to what the ideal mixture for radio controlled aircraft is vs. radio controlled cars. It is generally thought that airplanes can tolerate less nitromethane, which might cause engine damage when used at high altitude.
Diesel
Many radio controlled enthusiasts prefer two-stroke and four-stroke diesels. These engines are lighter, less complicated, more reliable and produce more torque than their gas-power equivalents.
Alternatives
Some prefer to use propane, bio-diesel, hydrogen or even acetylene and nitrous oxide to fuel their radio controlled engines.