Papyrus Design Group, founded by David Kaemmer and Omar Khudari, had previously developed Indianapolis 500: The Simulation in 1989, a landmark title that set new standards for racing simulation on personal computers. IndyCar Racing extended that work to a full season simulation covering the entire PPG Indy Car World Series, including most of the contemporary chassis and engine options and eight circuits available at launch, with the Indianapolis Motor Speedway and additional tracks added through subsequent expansion packs.
The game featured most drivers and teams from the 1993 season, with the notable absence of Nigel Mansell. Mario Andretti and Danny Sullivan appeared in generic liveries. The Indianapolis Motor Speedway expansion added a paint shop allowing players to create and apply custom liveries to their cars.
IndyCar Racing offered a comprehensive simulation experience for its time. Players could compete in single events or construct a full championship season from the available tracks installed on their machine. Each race weekend included practice, qualifying, warm-up, and race sessions. The car could be set up and adjusted both on-track and in a dedicated garage mode.
Qualifying procedures differed between circuit types: road courses offered a ten-minute open session with unlimited laps, while ovals used a two-flying-lap format with the better average speed counting. At Indianapolis specifically, four flying laps were run and their average determined grid position, matching real-world Indy 500 qualifying procedures. In all cases, opponents' qualifying positions were pre-determined by the game, and skipping qualifying placed the player last on the grid.
Races featured standing starts with cars two abreast on road courses and three abreast at Indianapolis. A pit board displayed the player's gap to the leader on each crossing of the start/finish line. The game modelled yellow flags and caution periods, during which overtaking was prohibited but pit stops could still be taken. Cars could retire through mechanical failure at any point during a race, including under caution.
Head-to-head racing against another player was supported by connecting two computers via modems running at 9600 bit/s or faster, or via a null-modem serial cable.
The game moved significantly beyond its predecessor in replay capability. While Indianapolis 500: The Simulation had offered only the last twenty seconds of footage from a limited set of camera angles, IndyCar Racing stored approximately one hour of footage from multiple camera angles for each car on track. Unlimited replays could be saved for later viewing.
Shipments of IndyCar Racing to retailers surpassed 400,000 units by 1999, with global sales estimated at approximately 300,000 units by 2004.
Critical reception was exceptional. Computer Gaming World in 1994 described it as "the only current driving sim where 180 mph feels like 180 mph", praising in particular the simulation of drafting behaviour, the AI drivers' conduct, and the accuracy of the track representations. The magazine's conclusion was that it "is the purest driving game ever let loose on the gaming public." IndyCar Racing won Computer Gaming World's Simulation Game of the Year award in June 1994, with editors calling it "the motor sports aficionado's dream come true." It was a finalist for Electronic Entertainment's 1993 Best Game award and won Best Sports Program at the 1994 Codie Awards.
In 1994, PC Gamer US ranked IndyCar Racing the 20th best computer game ever made, while PC Gamer UK placed it ninth all-time, calling it "clearly the best motorsports game on the PC."
IndyCar Racing was followed by IndyCar Racing II in 1996. Together the two games established Papyrus as the pre-eminent studio in PC motorsport simulation, a reputation the company sustained through the NASCAR Racing series, Grand Prix Legends, and the technologies that eventually underpinned iRacing.