The E36 M3 was released in November 1992 and was initially available as a coupe only, with a convertible added in 1994 and a saloon version in December 1994. It was the first M3 to use a six-cylinder engine, powered by the BMW S50 straight-six. The initial 2,990 cc version generated 210 kW (286 PS) at 7,000 rpm. In late 1995, a facelift version introduced an enlarged 3,201 cc engine producing 236 kW (316 hp) at 7,400 rpm, along with a 6-speed gearbox and a new SMG automated manual transmission option.
The introduction of the E36 M3 coincided with BMW's withdrawal from the Deutsche Tourenwagen Meisterschaft, with BMW instead focusing on the 318i and 320i models in the Super Tourenwagen Cup for that series. Nonetheless, the E36 M3 found considerable use in private hands and in various national touring car series across Europe.
In Germany, the E36 M3 GTR won the ADAC German GT Cup in 1993, driven by Johnny Cecotto. The M3 GT also competed in the European FIA GT Championship. In the United States, the Prototype Technology Group Racing team ran the E36 M3 in the IMSA GT Championship with strong results, winning the manufacturer's championship in multiple seasons during 1996, 1997, and 1998.
The E36 M3 was run by private teams in the British Touring Car Championship during the mid-1990s. The car's powerful S50 engine and well-developed suspension made it a competitive package in the hands of privateer outfits. The BTCC during this period was one of the most hotly contested touring car championships in the world, featuring works entries from manufacturers including Honda, Renault, Peugeot, Vauxhall, and Ford alongside privateer machinery.
A limited M3 GT edition was produced in 1994 as a homologation special for FIA-GT class competition, with a total of 356 cars produced in left-hand drive for mainland Europe. The GT featured uprated camshafts and a higher compression ratio on the European S50B30 engine, achieving 220 kW (295 hp), along with a deeper front splitter, a higher rear double wing, and aluminium doors.
The M3 GTR road car for the E36 generation was a single example built in 1993, created as the road-going version of the competition machine that won the ADAC German GT Cup. It featured a widebody kit, stripped interior, seam-welded body, upgraded suspension, and a slightly enlarged engine.
Total production of the E36 M3 reached 46,525 coupes, 12,114 convertibles, and 12,603 saloons before production ended in 1999. The E36 generation bridged the dominant E30 era and the acclaimed E46, and its motorsport appearances in touring car competition across multiple continents demonstrated the underlying competitiveness of the platform in private hands. It was succeeded in BMW's motorsport programme by the E46-based M3 and the dedicated M3 GTR racing car.