A kind of motivic algebra of spectral categories and modules over them is developed to introduce K-motives of algebraic varieties. As an application, bivariant algebraic K-theory as well as bivariant motivic kohomology groups are defined and studied. We use Grayson's machinery to produce the Grayson motivic spectral sequence connecting bivariant K-theory to bivariant motivic kohomology. It is shown that the spectral sequence is naturally realized in the triangulated category of K-motives constructed in the paper. It is also shown that ordinary algebraic K-theory is represented by the K-motive of the point.

This is the final version; to appear Homology, Homotopy and Applications. arXiv admin note: text overlap with arXiv:math/0108143 by other authors