The E46 M3 GTR racing car was introduced in February 2001. BMW developed the car in response to the standard E46 M3's uncompetitive performance against the Porsche 996 GT3 in the 2000 American Le Mans Series GT category, where the S54 straight-six engine was outpaced by the opposition. The GTR was powered by a 3,997 cc P60 V8 engine producing 330 kW (443 hp), a unit with no relation to the road car's S54 inline-six.
The GTR won the 2001 American Le Mans Series GT category, with Jorg Muller taking the class victory. The car's success sparked significant controversy. The ALMS homologation rules at the time required a production model to be available for sale on at least two continents within twelve months of the rules being issued. BMW claimed to fulfil this requirement by making 10 GTR road cars available for sale, pricing them at approximately 250,000 euros.
Following the 2001 season, the ALMS changed its homologation rules to require that 100 cars and 1,000 engines be built for a car to qualify without penalties. As the GTR road car had never been intended for production at this scale, BMW withdrew the GTR from ALMS competition.
To satisfy the homologation requirements for the 2001 season, BMW produced a road-going version of the M3 GTR. The company built 10 development units, of which 3 were production-ready display cars. The remaining 7 development prototypes were later recycled, but the three production-ready display cars remained in existence and in BMW's ownership. One was displayed by BMW of North America at Legends of the Autobahn in 2015.
The road GTR retained the race car's 4.0-litre P60 V8 engine, slightly detuned from 331 to 285 kW (444 to 382 hp) at 7,000 rpm, along with the race car's dry-sump oil system. Top speed was 295 km/h. The transmission was a six-speed manual and the differential was the same variable locking unit as in the race car. Dry weight was 1,350 kg, with weight savings from carbon fibre front and rear bumpers and rear wing.
Following withdrawal from ALMS competition, the M3 GTR returned to racing at the 24 Hours Nurburgring. In 2003, two cars were entered by Schnitzer Motorsport. The GTR went on to win the 24 Hours Nurburgring in 2004 and 2005, and also competed at the 24 Hours Spa. The car also appeared at the 2003 Bathurst 24 Hour race in Australia, entered by Prancing Horse Racing with drivers including John Bowe and Neil Crompton, though the car retired after 131 laps.
The M3 GTR gained widespread recognition beyond motorsport through its appearance in the 2005 video game Need for Speed: Most Wanted. The game featured a distinctive custom livery on the car that became iconic within the gaming community, with the livery being recreated by fans in real life for decades after the game's release. In November 2024, BMW vinyl-wrapped the 2001 ALMS GT-winning M3 GTR with the Need for Speed: Most Wanted livery as a museum piece, displaying it at the BMW Welt Show in Munich from December 2024 to January 2025.
The M3 GTR stands as one of the most dramatic homologation exercises in touring car and endurance racing history. Its V8 engine, built into a car nominally derived from a six-cylinder road car, demonstrated both BMW's engineering ambition and the tensions that arise when factory prototype resources are directed into nominally production-based categories. The subsequent rule changes it prompted reshaped ALMS GT class regulations and influenced how other manufacturers approached homologation in American endurance racing during the 2000s.