Goods transportation is essential for economic development. In a highly globalised world, it is expected to become more important over the years. Inter-urban freight transport has a major role when it comes to resource consumption, pollution and climate change. Thus, its decarbonisation is one of the biggest challenges to be tackled nowadays. One way of achieving decarbonisation is a modal shift from more polluting modes to less polluting ones. In this research, we investigate Brazil as a case study due to its rapid growth in transportation demand, the need for new transportation infrastructure and its uneven modal split. The high-level objective of this research is to explore potential policies that promote a modal shift towards decarbonisation of freight transportation in Brazil. Policies include fiscal and regulatory measures, vehicle technology innovation, in addition to the infrastructural investments made in highways, railways and waterways. We investigated impacts on modal split, demand per mode and CO2 emission. The findings show that the process of modal shift is slow, which is in line with what observed in practice. However, implementing a combination of stricter policy measures early on and changes in investments strategies accelerate the process and create robust measures capable of promoting modal shift and decarbonising the system under different scenarios. Experiments highlighted how the system tends to adjust to the measures and how they tend to lose efficiency over time, slowing the decarbonisation's rhythm. Moreover, findings also display how modal shift policies alone might not be sufficient to achieve the reduction in CO2 emission desired by policy-makers. Addressing the problem with this approach helps decision-makers to develop more efficient policies strategies. The research sheds light on modal shift dynamics over the next 30 years in Brazil and whether a System Dynamics approach can assist in the policy-making decision for modal shift towards decarbonisation of freight transportation.