Knocking combustion limits the downsized gasoline engines’ potential for improvement with regard to fuel economy. The high in-cylinder pressure and temperature caused by the adaptation of a turbocharger aggravates the tendency of the end-gas to autoignite. Thus, the knocking combustion does not allow for further advancing of the combustion phase. In this research, the effects of the ignition and valve timings on knocking combustion were investigated under steady-state conditions. Moreover, the optimal ignition and valve timings for the transient operations were derived with the aim of a greater fuel economy improvement, based on the steady-state analysis. A 2.0 liter turbocharged gasoline direct injection engine with continuously variable valve timing (CVVT), was utilized for this experiment. 2, 10, and 18 bar brake mean effective pressure (BMEP) load conditions were used to represent the low, medium, and high load operations, respectively. The engine speed was set at 1,500 RPM since the low speed conditions were more vulnerable to knocking combustion than the high speed conditions. Both the intake and the exhaust valve timings were controlled from the reference timings in a step of 10 crank angle degrees (CAD). The ignition timing was also controlled in a similar manner, but only with 1.5 CAD steps. The experimental result showed that reducing the exhaust backpressure by increasing the wastegate opening level was effective in expanding the knock margin. This was mainly owing to the enhanced scavenging driving force created by the increased wastegate opening. During the transient operation, increasing the wastegate opening by maximally advancing the exhaust valve timing was shown to be an effective procedure in this case. With the maximized advance, sufficient exhaust energy was supplied to the turbocharger such that less amount of exhaust flow was required. Thus, the greater wastegate opening could be achieved, which enhanced the scavenging process. As a result, the ignition timings were advanced beyond the previous knock margins. With the use of this procedure, torque output and fuel consumption were improved by a maximum of 3.3% and 2.4%, respectively.