The fourth-generation BMW 3-Series was launched in May 1998 and brought with it another hike in output, comfort and safety. The new model was four centimetres (approx. 1.5 in.) longer and wider than its predecessor, and its interior had also grown accordingly. By the end of 1999 the BMW 3-Series had risen to third place in Germany's registration lists, an unprecedented achievement for a car in this class.

The 320d gave a debut to the brand's first direct-injection diesel engine, while the 318i was now fitted with two balancer shafts. The most technically noteworthy development among the six-cylinder petrol engines was the introduction of Double-Vanos. The continuously variable and fully automatic adjustment of both the intake and exhaust camshaft gave the engines more abundant torque and further reduced emissions. The high-output 330d diesel saw common rail injection take over fuel supply to the cylinders for the first time. In 2001 BMW presented the throttle butterfly-free load control system VALVETRONIC. This technology allows variable lift of the intake valves and boosts output while lowering fuel consumption and emissions. It wasn't long before VALVETRONIC was introduced into series production.

BMW also presented a new all-wheel-drive system for the Sedan and Touring variants. BMW xDrive uses automatic brake inputs on a particular wheel or wheels to mimic the effect of conventional locks. Another new development came with the ability to distribute power fully variably between the driven front and rear wheels. The pioneering fourth-generation line-up also included the BMW 3-Series Coupé and Convertible, which were now available with diesel engines and cleverly combined the qualities of driving pleasure, styling and good sense.

2005: the fifth generation - BMW EfficientDynamics, High Precision Injection, TwinPower Turbo technology and a new CO2-beater

The fifth, outgoing generation of the BMW 3-Series range celebrated its world premiere at the Geneva Motor Show. The new combination of powerful engines, dynamic and refined driving characteristics, striking design and innovative equipment was met with resounding approval around the world. Since 2007, the BMW EfficientDynamics development strategy has shown how the driving pleasure of the BMW 3-Series can be blended harmoniously with exceptionally low fuel consumption and emissions.

All petrol engines now came with the direct injection system High Precision Injection, which brought a fuel-saving lean-burn approach to both the 330i and 325i six-cylinder models and the four-cylinder 320i and 318i. In the BMW 335i, meanwhile, the injection system teamed up with TwinPower Turbo technology, two turbochargers and Double-Vanos. To keep weight as low as possible, BMW introduced a crankcase made from aluminium or an even lighter magnesium/aluminium composite.

By model year 2010 all the engines met the EU5 exhaust standard. For its part, the BMW 320d EfficientDynamics Edition was the most efficient car in the mid-size segment - with something to spare. The third-generation common rail direct injection unit developed 120 kW/163 hp, and fuel consumption in the EU driving cycle was just 4.1 litres of diesel per 100 kilometres (68.9 mpg imp).

Over the past 36 years BMW has consistently expanded its leading position in the sporty mid-size segment. The BMW 3-Series range showcases its sporting roots - across a variety of model variants and output classes - with greater conviction than any other car in its class. This has led to BMW repeatedly taking on the mantle of innovative trendsetter and leader, both in the development of engine and drive system technology and beyond.