Tesla Inc. says owners of its electric vehicles have driven 1 billion miles using the company’s Autopilot driver-assistance feature -- a significant milestone for the automaker, which uses the collected data to improve the software as a competitive advantage.

Tesla, which announced the mark in a Tweet Nov. 28, has installed Autopilot hardware on every car it’s produced since October 2014. Autopilot is designed for use on highways, but the vehicles are operating under diverse road and weather conditions around the world. The resulting trove of real-world miles acts as a feedback loop to the algorithms that are constantly training...