The Daytona originally used the 2.2 L Chrysler K engine in naturally aspirated or turbocharged form.

Many Turbo Z models were produced and were more luxurious than other years due to their use of Mark Cross leather, light up speakers, and rear amplifier switches.

[citation needed] The biggest addition was the C/S (Carroll Shelby) suspension package, available only as an option on the Turbo Z.

The Shelby Z also featured numerous suspension upgrades, including a larger diameter front sway bar and disc brakes on all four wheels.

A more luxury-oriented Pacifica trim line was also added to replace the Chrysler Laser, which was dropped in mid-year 1986.

Among the optional equipment was a leather interior, eight-way power enthusiast driver's seat (with mechanical thigh and lumbar controls), digital-instrument cluster, and a twelve-button trip computer (with instant fuel ratings as well as trip averages and estimated-travel times).

In order to reduce weight and produce a lighter Daytona, the C/S came without the ground effects and other features that were on the Shelby.

The motor was linked to an all-wheel drive (AWD) system designed by Lotus UK and the car was called the Decepzione.

Despite its performance and media buzz generated by articles in Automobile magazine, the project was discontinued because of the engine's oil pan having just 1.5 inches (38.1 mm) of ground clearance, necessitated by the comparatively tall engine block.

It featured silver contrasting ground effects, along with "snowflake" patterned alloy wheels.

The AGB C/S Performance model had the 2.5 L non-intercooled Turbo I engine available with five-speed manual or three-speed automatic.

For 1990, all Daytonas received an interior restyling, featuring a modernized cockpit-style wraparound dashboard.

The facelift replaced the pop-up headlights with flush-mounted rounded ones and added a new grille and rear fascia.

Also available on the IROC was the new R/T performance package, which featured a 224 hp (167 kW) Turbo III version of the 2.2 L four-cylinder, but with a Lotus designed DOHC cylinder head and direct ignition system instead of a distributor-type ignition system; this engine was shared with the Dodge Spirit R/T.

These IROCs featured "Shelby" decals which were added at the dealership or later to help boost sales.

Shelby versions were mainly "Chrysler" branded Daytonas which were sold overseas and were part of an early run of IROCs.

The Laser was a virtual clone of the Dodge Daytona, but came only in the upscale trim version.

The standard, XE and XT trim lines would continue until the Laser’s demise in mid-1986.

The Laser was replaced by the Mitsubishi built Chrysler Conquest, a rear-wheel drive vehicle which competed directly against the Toyota Celica Supra.

The Laser name was silently terminated after the first half of 1986 model year, then resurrected for the 1990 model year as the Plymouth Laser, built by Diamond Star Motors, a joint venture between Chrysler and Mitsubishi.

The rebranded Laser shared its body and chassis with the Eagle Talon and Mitsubishi Eclipse.