BMW M3 E36

The M3 model of the E36 3 Series was released in November 1992 and was initially available as a coupé only, with a convertible version added in 1994. A sedan version was also added in December 1994, to fill in the gap caused by the lack of a BMW M5 sedan model between the end of E34 M5 production in 1995 and the launch of the E39 M5 in 1998.

In September 1995, a facelift version of the coupe was introduced. Changes included the engine displacement increasing to 3.2 L (195 cu in), the manual transmission upgrading from a 5-speed to a 6-speed, different wheels and clear indicator lenses. The facelift changes were applied to the sedan model in November 1995 and the convertible model in February 1996. The kerb weight of the 1996 M3 coupe in European specification is 1,515 kg (3,340 lb).

The facelift also saw the introduction of a 6-speed "SMG" automated manual transmission, the first time an automatic transmission was available on an M3 outside the United States. The SMG transmission was praised for its fast shift times and operation in performance situations, but criticised for behaviour in everyday driving situations.

In 1996, BMW M hand-built a E36 M3 Compact prototype as an M-car which would appeal to younger customers. It included various performance and styling features of the E36 M3, including the 3.2 litre S50 engine. The M3 Compact was reviewed in the German magazine 'Auto Motor und Sport', however it did not reach production.