A list of some of the best top-down racing games I've found, ALL of them have coop/split screen local multiplayer, for up to 4 players (at least most of them) or more.
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https://store.steampowered.com/app/1435090/Bloody_Rally_Show_Prologue (free)

Ultimate Racing 2D 2 on Steam
The ultimate top-down racing game is back! Ultimate Racing 2D 2 includes new cars, new tracks, car/track editor, time-trial mode, improved online multiplayer and career mode, new settings and more.

Save 50% on Super Arcade Racing on Steam
Bring back the 80s! Classic top-down retro-racing with a gripping story mode, local and online multiplayer and leaderboard. Customise your car and race through more than 60 tracks on several biomes, defeat dodgy rivals and uncover a gripping mystery. Pure arcade fun with an 80s-inspired OST.

Circuit Superstars on Steam
Circuit Superstars is a top down racing game with a tactile arcade physics model, pitstops, and a pure motorsport approach. It includes 16 categories that span different styles and eras of motorsport.

Super Woden GP on Steam
Feel the excitement of the 90s with the isometric perspective, its huge number of vehicles and its brilliant soundtrack. More than 70 cars from six manufacturers from different countries to buy, an extensive campaign mode, dozens of circuits, rally stages, championships, and much more awaits you!

Barely Racing on Steam
Race, shoot, place mines and blow your enemies out of the track in this isometric combat racing game.


Total Arcade Racing on Steam
Total Arcade Racing is a fun 2D top-down arcade racing game where you zip around closed circuits. Play solo or with up to 8 friends on the same screen in various game modes. This game is a tribute to old school arcade racing games like Super Sprint, Slicks 'n' Slide and Super Cars.

Pretend Cars Racing on Steam
An old school top-down racer with split-screen multiplayer.

Save 50% on Super Arcade Racing on Steam
Bring back the 80s! Classic top-down retro-racing with a gripping story mode, local and online multiplayer and leaderboard. Customise your car and race through more than 60 tracks on several biomes, defeat dodgy rivals and uncover a gripping mystery. Pure arcade fun with an 80s-inspired OST.