The Z3 M Roadster was introduced in 1997 as the high performance version of the BMW Z3 Cosmetic differences between the Z3 M and the standard Z3 models included front and rear bumpers, gills, boot and mirrors.The standard Z3 models received a faceliftin 1999. The appearance of the Z3 M was not changed.In the 6 years from 1997 to 2002, 15,322 M Roadsters were produced.

Starting in September 2001, the engines were upgraded to the BMW S54 engine from the E46 M3. In most countries, it is rated at 239 kW (321 hp) at 7,400 rpm, while North American models have 235 kW (315 bhp) at 7,400 rpm. The difference in peak power and torque is due to the catalytic converters being located closer to the engine on the North American spec cars, which allows the catalysts to heat up faster and reduce cold start emissions.