Porsche introduced a road-legal GT3 version of the 996 series which was derived from the company's racing car used in the GT3 class racing. Simply called GT3, the car featured lightweight materials including thinner windows and deletion of the rear seats. The GT3 was a lighter and more focused design with an emphasis on handling and performance, a concept that dates back to the 1973 Carrera RS. The suspension ride height was lowered and tuned for responsiveness over compliance and comfort. These revisions improved handling and steering. Of more significance was the engine used in the GT3. Instead of using a version of the water-cooled units found in other 996 models, the naturally aspirated engine was derived from the 911 GT1 '98 sports-prototype racing car and featured lightweight materials which enabled the engine to have higher rpm.

The engine used was a naturally aspirated 3,600 cc (3.6 L) flat-six rather than the engine from the pre-facelift and revised Carrera. It is rated at 365 PS (268 kW; 360 hp) at first and later improved to 386 PS (284 kW; 381 hp) at the end of the 996 series' revision.

The Type 996 introduced in 1998 represented two major changes for the venerable 911 lineage: a water-cooled flat-6 engine replaced the popular air-cooled engine used in the 911 for 34 years and the body shell received its first major re-design. Changing to a water-cooled engine was controversial with Porsche traditionalists, who noted this as the end of the 'true' 911.

The 996 styling shared its front end with Porsche's mid engine entry-level Boxster. Pinky Lai's work on the exterior won international design awards between 1997 and 2003.

The Carrera variant had a 0.30 coefficient of drag. The interior was criticized for its plainness and its lack of relationship to prior 911 interiors, although this came largely from owners of older 911s.

The Type 996 spawned over a dozen variations, including an all-wheel-drive Carrera 4 and Carrera 4S (the latter which had a 'Turbo look' in facelift form) models, the club racing-oriented GT3 and GT3 RS instead of a Carrera RS variant and the forced-induction 996 Turbo and GT2. The Turbo, which was four-wheel-drive and had a twin-turbocharged engine, often made appearances in magazines' lists of the best cars on sale.

The Carrera and Carrera 4 underwent revisions for the 2002 model year, receiving clear lens front and rear indicator lights which were first seen on the Turbo version two years earlier. This allowed the 911 to be more distinguishable from the Boxster. A mildly revised front fascia was also introduced, though the basic architecture remained.

Engine displacement was 3.4 L and power output was 300 PS (221 kW; 296 hp) featuring a change to an "integrated dry sump" design and variable valve timing. The displacement was increased in 2002 to 3.6 L and power received an increase to 320 PS (235 kW; 316 hp).

The folding roof mechanism on the convertible variants required 19 seconds for operation. An electronically adjustable rear spoiler was installed that raised at speeds over 120 km/h (75 mph). It could also be raised manually by means of an electric switch.

Starting from the models with water-cooled engines, all variants of the 911 Carrera do not come with rear limited-slip differential, except the 40th Anniversary 911, GT2, GT3 and Turbo. The exception would be for MY1999 where the limited-slip differential was available as option code 220