In the mid-1960s BMW perceived a market for a smaller, more affordable, two-door version of its four-door New Class executive sedan.

The larger displacement 2002 directly derived from it in 1968 would go on to establish a new reputation for BMW as a maker of high-quality affordable performance vehicles.

The original design was a full convertible; after 1971 this was replaced by a targa-top model with fixed window frames called a "top cabriolet" (commonly referred to as a cabrio coach).

Helmut Werner Bönsch, BMW's director of product planning, and Alex von Falkenhausen, designer of the company’s M10 engine, each had a two-litre version of the M10 installed in a 1600-2 for their personal use.

When they realized they had both made the same modification to their own cars, they prepared a joint proposal to BMW's board to manufacture a two-litre version of the 1600-2.

[3][1] At the same time, American importer Max Hoffman was asking BMW for a sportier version of the 02 series that could be sold in the United States.

The cylinder head was a modified version of the '121TI' design (used on 1972 & earlier 2002s) with larger combustion chambers to give a compression ratio of 6.9:1, in order to prevent engine knocking.

A version of the Kugelfischer mechanical fuel injection was used with integrated boost enrichment feature and altitude compensation.

Two standard colours were available: Chamonix (white) and Polaris (silver) - and cars featured BMW motorsport colour-scheme stripes/decals on the sides & front airdam.

[2] The 1502, an economy model able to run on cheaper low-octane regular gas, was introduced in 1975 in response to increased gasoline prices resulting from global petroleum shortage.

It had the same 1573 cc engine displacement as the 1602, but a lower 8.0:1. compression ratio reduced power to 75 PS (55 kW; 74 hp).

A few early production models were actually assembled the previous fall for emissions testing and as press pool cars.

To celebrate the marriage of racer Hubert Hahne to Diana Körner, twelve custom 2002 ti models were built with changes including twin headlights (from the 2800 CS) a leather interior and Italian aluminium wheels.

[14] For the 1972 Olympic Games in Munich, Germany, BMW developed the "1602 Elektro" electric-powered concept vehicle, its first electric car.

[16] The 350 kg (772 lb) pack of twelve lead-acid batteries (located under the bonnet) gave a range of approximately 30 km (19 mi).

[30] Dieter Quester & Hubert Hahne won the June 1969 European Touring Car Race (ETCC) at Brand's Hatch, Kent, UK[31] in a BMW 2002 TiK (the ~250BHP turbocharged factory-developed 2002 touring car)[32] The BMW 2002 competed in the Trans Am Series under two liter class, although it saw little success as the class was dominated by Alfa Romeo, Porsche, and Datsun.