The concept originated as a response to Lancia's rallying success with the mid-engined Stratos. Jean Terramorsi, Renault's vice-president of production, proposed creating a high-performance variant of the Renault 5 Alpine that would qualify for Group 4 homologation while promoting the mainstream R5 brand. The distinctive rear bodywork was styled by Marc Deschamps at Bertone under chief designer Marcello Gandini. Renault sent a standard R5 Alpine to Bertone in October 1977 as the design base, under the project code name Projet 822.
The resulting car was mechanically unrelated to the ordinary Renault 5 despite sharing its greenhouse, door shapes, and general silhouette. The standard front-wheel-drive, front-mounted-engine layout was entirely discarded. In its place, the 5 Turbo used a rear-mid-mounted 1,397 cc Cléon-Fonte four-cylinder engine with Bosch K-Jetronic fuel injection and a Garrett AiResearch T3 turbocharger, producing 160 PS at 6,000 rpm and 221 N·m of torque at 3,250 rpm in road trim.
The rear suspension was derived from the Renault Alpine A310 V6, while the five-speed manual transmission came from the Renault 30 TX, mounted rotated through 180 degrees. The rear quarter panels were widened by 11.25 cm to accommodate broad rear tyres, with full-height air-intake grilles on their leading edges feeding the mid-mounted engine. A usable luggage compartment remained accessible through the rear hatch behind the engine bay. The interior was stripped to two front bucket seats facing a restyled dashboard with an asymmetrical steering wheel. Series one cars were typically red with blue upholstery, or the reverse combination.
The first 400 production 5 Turbos were manufactured at Renault's Alpine factory in Dieppe to satisfy Group 4 homologation requirements.
Once homologation was secured, Renault introduced the Turbo 2, which replaced many of the original's lightweight alloy components with standard Renault 5 parts and adopted the interior of the R5 Alpine. The Bertone-specific seats and dashboard were dropped. Despite being less exotic in construction, the Turbo 2 delivered nearly identical performance: a top speed of 200 km/h and 0–100 km/h in 6.9 seconds.
A separate batch of 200 Turbo 2 units was built to homologate the car for the new Group B class. These featured an alloy roof, an enlarged 1,437 cc engine, and a range of aerodynamic and geometry changes enabling the car to compete in Group B alongside the Lancia 037 and Audi Quattro.
Total production across both variants reached 4,987 units: 1,820 Turbo 1 and 3,167 Turbo 2.
For competition, Renault developed the road engine through successive power increases. Output reached 180 PS for the Critérium des Cévennes, 210 PS for the Tour de Corse, and by 1984 as much as 350 PS in the R5 Maxi Turbo specification. The ultimate Renault 5 Maxi Turbo Superproduction variant reached 385 PS and won the 1987 French Supertouring Championship.
The R5 Turbo competed in the sub-2000 cc category due to the regulatory multiplication factor of 1.4 applied to turbocharged engines. When Renault developed the Maxi Turbo, they enlarged the engine to 1,527 cc — which became 2,138 cc under the formula — placing it in the 2000–2500 cc class and permitting wider wheels at the cost of higher minimum weight.
Jean Ragnotti drove the R5 Turbo to victory at the 1981 Monte Carlo Rally, the car's first World Rally Championship event. The two-wheel-drive R5 Turbo proved fast on tarmac but was progressively outpaced on loose surfaces as four-wheel-drive Group B machinery arrived.
After official factory involvement ended, the R5 Turbo continued to be developed by private teams and enthusiasts, remaining competitive in regional and national championships for nearly 20 years and later returning to international events through historical rally categories.
The Renault 5 Turbo stands as one of the most dramatic homologation specials in rallying history — a car that bore only superficial resemblance to its mass-market namesake while hiding a completely different mechanical identity underneath. Its Monte Carlo victory in 1981 demonstrated that a sophisticated mid-engine layout could win at the highest level even against increasingly specialized competition. The design's influence extended beyond rallying: the concept of a mid-engined small Renault returned with the 1998 Renault Clio V6. Sports Car International named the R5 Turbo ninth on its list of Top Sports Cars of the 1980s, and it remains one of the most admired French competition cars of its era.