The ST185 was launched in Japan in September 1989, with production starting from December 1988 prototypes. It used an updated 3S-GTE engine featuring an air-to-air intercooler and a CT26 twin-entry turbocharger designed to eliminate exhaust gas interference. Japanese market versions produced 225 PS at 6,500 rpm and 304 Nm of torque; export market versions were tuned differently, with the US All-Trac Turbo producing 200 hp and 271 Nm.
Export models were exclusively wide-body liftbacks with flared fenders, while the Japanese market initially offered a narrower-body option before the wider GT-Four A variant was added to the Japanese lineup in August 1990. Three different gearboxes were fitted depending on market: the E150F for regular Japanese models and the US All-Trac, the E151F for European and Australian markets, and the close-ratio E152F fitted to the GT-Four Rally Japanese market variant.
In August 1991, the ST185 received a minor facelift with new Toyota ellipse badges, restyled tail lights with smoked red frames, and a shorter gearshift. The GT-Four RC variant, launched in September 1991 for the Japanese market — and sold in Europe as the Carlos Sainz Limited Edition and in Australia as the Group A Rallye — was produced in approximately 5,000 units to meet FIA homologation requirements for the 1992 WRC season. This variant used a water-to-air intercooler better suited to competition, a revised bonnet to evacuate engine bay air, a lighter bumper, shortened shift lever and clutch travel, and triple-cone synchromesh on second and third gears.
Toyota Team Europe prepared the ST185 rally cars at their Cologne facility. The car made its WRC debut at the 1992 Rally Monte Carlo and claimed its first victory that year at the Safari Rally — one of four victories in 1992. Over the course of its career the ST185 won 16 full WRC rounds, plus three additional wins in the non-championship W2L series.
Carlos Sainz won the WRC Drivers' Championship in 1992. In 1993 and 1994, Toyota claimed both the Manufacturers' and Drivers' championships: Juha Kankkunen took the drivers' title in 1993, followed by Didier Auriol in 1994. The ST185 was thus responsible for three consecutive drivers' titles and two consecutive manufacturers' titles — a period of dominance that established Toyota among the WRC's elite.
Toyota Team Europe also introduced the anti-lag system (ALS) to Group A rally cars in the ST205 era, a technological development the ST185 programme helped lead up to. Toyota's achievements with the GT-Four platform preceded and influenced the subsequent boom in Japanese WRC involvement from Mitsubishi and Subaru.
The succeeding ST205, introduced for 1994, carried the GT-Four's WRC career into a third generation. In 1995, Toyota was disqualified after the Rally Catalunya following the discovery of illegal turbo restrictor bypass devices, resulting in a one-year ban for Toyota Team Europe. FIA president Max Mosley described the device as "the most sophisticated I've ever seen in 30 years of motor sports." The drivers — Juha Kankkunen, Didier Auriol, and Armin Schwarz — had their championship points removed, though Mosley confirmed there was no suggestion the drivers were aware of the technical infringement.
The ST185 remains the centrepiece of Toyota's Group A WRC achievement. Its record of three drivers' championships and two manufacturers' championships in four seasons of full competition stands as the strongest result any Toyota car achieved in the WRC until the Yaris WRC era beginning in 2017. The ST185 also won the 1995 European Rally Championship after TTE's WRC ban. Road versions of the car — particularly the Carlos Sainz Limited Edition and Group A Rallye homologation specials — remain sought after by collectors and enthusiasts as direct expressions of Toyota's factory rally programme.