The W194 was built around a lightweight welded SAE 4130 steel tube spaceframe chassis weighing just 140–150 pounds, conceived by Daimler-Benz chief development engineer Rudolf Uhlenhaut to offset the relatively modest output of the M194 engine. The spaceframe's construction enveloped the passenger compartment, making conventional side doors impossible. This constraint led to the model's distinctive gull-wing door arrangement, where the doors opened upward from the roofline — though in early versions only the windows opened, and larger door apertures were cut into later chassis at the insistence of Le Mans organisers.
The engine was derived from the overhead-cam straight-six introduced with the flagship Mercedes-Benz 300 (W186) luxury car, fitted with a triple two-barrel Solex carburetor setup borrowed from the 300 S coupe. The cylinder head was canted 50 degrees to the left to fit beneath the W194's lower hood line. Top speed was approximately 160 mph (257 km/h).
Aerodynamics, weight distribution, and four-wheel independent suspension combined to make the W194 competitive against rivals with considerably more power. However, the rear swing axle — jointed only at the differential rather than at the wheels — could become unpredictable at high speeds or on uneven roads, and a large fuel tank produced pronounced handling differences between full and near-empty loads.
Only ten W194s were built.
The W194 contested a single season, 1952, at a point just before the World Sportscar Championship was formally established. Four of the races that would form the backbone of the inaugural 1953 WSC — Sebring, the Mille Miglia, Le Mans and the Carrera Panamericana — had already been run in 1952, making that year's results a measure of what a hypothetical 1952 world championship might have looked like.
At the 2 May 1952 Mille Miglia, the W194 finished second and fourth, beaten by a Ferrari 250 S. Two weeks later at the Bern Grand Prix on the Circuit Bremgarten, Mercedes ran four cars for Rudolf Caracciola, Karl Kling, Hermann Lang and Fritz Riess. The race ended in a dominant 1-2-3 victory, with the field a lap down. Caracciola crashed out on lap 14 — an injury that ended his career.
For the 1952 24 Hours of Le Mans, the original gull-wing window openings had to be enlarged to satisfy ACO safety requirements, necessitating new chassis. Mercedes scored a 1-2 finish. At the Nürburgring's Eifelrennen sports car race in August, running without roofs or doors as open Spyders to suit the mountain circuit's demands, Mercedes finished 1-2-3-4.
The final event of the W194's season came at the Carrera Panamericana in Mexico in November 1952. Three cars were entered; two finished first and second, with the third disqualified. The victories on high-speed open road circuits were considered particularly significant given that the M194 engine used carburetors rather than the fuel injection that would appear in the road car two years later — low weight and aerodynamic efficiency compensating for the power deficit.
Following the W194's racing success, US Mercedes importer Max Hoffman proposed to Stuttgart management that a street version would sell strongly in America. The result was the 1954 Mercedes-Benz 300 SL Gullwing (W198), which used a fuel-injected version of the engine — the M198 — and became an icon of postwar automotive design. More than 80 percent of the approximately 1,400 units produced were sold in the United States, validating Hoffman's prediction and fundamentally changing Mercedes-Benz's American image from solid luxury manufacturer to a maker of high-performance sports cars.
The W194's competitive legacy continued through the Mercedes-Benz W196 Formula One car and the W196S 300 SLR sports racer of 1955.
Of the original ten W194 chassis, the exact number of survivors is unknown. One car, Chassis 00002, never raced and was used as a parts and training vehicle. It was fully restored by a Mercedes-Benz team and, while not for sale, received multiple offers reportedly exceeding USD 15 million in 2012.
The W194 is regarded by some historians as the most significant post-war Mercedes-Benz ever built, since its Carrera Panamericana success helped secure the brand's commercial future in North America at a time when the Chevrolet Corvette was launching in January 1953.