For hauling exterior loads a roof rack with a removable forward gear basket was standard equipment.

Road & Track described the Xterra as "an honest SUV that doesn't try to be a luxury car alternative, nor tries to hide its truck underpinnings".

The base XE featured a 143 hp (107 kW) KA24DE I4, rear-wheel 2WD, 5-speed manual transmission, and steel wheels, and a roof rack (rated for a load up to 125lbs).

The facelifted model debuted at the 2001 Chicago Auto Show with an optional supercharged V6 engine option, revised front-end styling with rounded headlights and raised hood (48mm), revised instrument panel with three round gauges in grey trim (XE) or blue (SE), revised HVAC controls, console with side map pocket, 25 percent larger glove box, map lamp with integrated compass (SE), pull-out rear cup holders, four interior power points, revised new seat fabrics, standard variable intermittent front windshield wipers and rear wiper, optional 300-watt audio system, foot-operated pedal parking brake replacing the dash-mounted pull-and-twist parking brake — and an increase of 10 horsepower for the V6 engine.

The Xterra entered production in Brazil in June 2003, being assembled in the Renault-Nissan Alliance commercial vehicle plant in São José dos Pinhais.

The Brazilian-made Xterra was equipped with a locally built, MWM Sprint 2.8-liter turbodiesel four-cylinder engine developing 132 PS (97 kW; 130 hp) at 3,600 rpm.

For the 2006 model year, MWM updated the engine to include common rail injection and an electronic control unit; hence known as the "Eletronic".

[17] The second generation Xterra[19] debuted at the New York International Auto Show in 2004 and entered showrooms in early 2005 for the 2005 model year.

[21][22] The standard engine was upgraded to Nissan's 4.0 L VQ40DE variable valve timing DOHC V6, producing 261 hp (195 kW)[18] and 281 lb⋅ft (381 N⋅m) of torque.

The PRO-4X and off-road also came standard with an electronic rear locking differential and either hill descent/start control or clutch interlock bypass switch on automatic and manual examples respectively.

The Xterra received a facelift for 2009 (July 2008 production) with more options and colors, optional leather seats on SE models, new grille and front bumper, silver painted rear bumper and roof rack, and roof mounted lights on off-road models.

Other difference between the American Xterra and its Chinese counterparts is the parking brake actuator, a pedal with a pull-handle release in America, and a lever in China.