It depends on what competiotn you want to go in, if like Formula 1 the rules dictate the engine configuration you have to use then no, they currently dictate a V8 but have allowed one team to use an older V10 because of some agrement. For WRC or GT racing, sure you can use a rotary engine, but it depends in most cases on what engines are in your model range and/or what engine is fitted to the production version of the car being considered for entry, a BTCC car has to use an engine no bigger than 2 liters and it has to come from a car from that companies model range, if theres no roatry engine in the range, they can't use one. Mazda are currently the only company makiong road cars with rotary engines, however they did race the RX-7 in various motorsports and they do race the RX-8, they race rotary powered prtotypes in GT racing in the 80's and early 90's as well. And as ND4SPD said, they race the LMP2 class Kudzu which is a rotary powered car also.