[8] On 19 January 2017, it was announced that a customized version of the SIG Sauer P320 had won the United States Army's XM17 Modular Handgun System competition.

Modifications include: On 19 January 2017, it was announced that the SIG Sauer P320 MHS variant had won the United States Military's Modular Handgun System trials.

Though the pistol will remain chambered in 9 × 19 mm Luger rather than a larger caliber, the contract allows the services to procure SIG Sauer's proposed XM1152 Full Metal Jacket and XM1153 Special Purpose ammunition.

At the same time, the rest of the U.S. Armed Forces revealed they also intend to acquire the handgun, making it the standard sidearm for the entire U.S. military.

The services plan to procure up to 421,000 weapons in total; 195,000 for the Army, 130,000 for the Air Force, 61,000 for the Navy (XM18 compact version only), and 35,000 for the Marines.

Issues of drop firing or shooting its user in the leg while holstered[21] have continued sporadically with at least six departments removing the P320 from service.

[22][23][24][25] As of April, 2023, an investigation has shown more than 100 people have reported that their own P320 fired without someone pulling the trigger, wounding at least 80 of them, including 33 officers at 18 law enforcement agencies.

[28] In June 2021, a technical investigation found that the misfire was due to "a partial depression of the trigger by a foreign object combined with simultaneous movement of the slide [...] that then allowed a round to be fired whilst the pistol was still holstered" and that the usage of a holster designed for a different pistol was a contributory factor; the P320 itself was not at fault nor were there any issues with how it had been procured by Canadian defence officials (since questions had been raised as to whether these officials were aware of the drop safety issues).

[33] The X-Carry is the frame used for the M18 Released in late July/early August 2019 the XFIVE Legion is considered the flagship of the P320 platform that brings added weight and features.

Internet publications, such as TheTruthAboutGuns.com, conducted independent tests that appeared to confirm potential drop firings (at a 40 percent rate).

[40] The upgrade is described on the company's website as: "an alternate design that reduces the physical weight of the trigger, sear, and striker while additionally adding a mechanical disconnector.

[10] Unlike other striker-fired guns, the P320 is "effectively fully cocked at rest", since its striker is under constant spring pressure, which is released when the trigger is pulled.

[46][47] On August 4, 2017, four days before the Voluntary Upgrade Program was announced, Stamford Police Department SRT officer Vincent Sheperis filed a negligence action in the United States District Court for the District of Connecticut against SIG Sauer after his holstered P320 allegedly fell from the back of his vehicle and discharged a round into his knee on January 4, 2017.

[48][49] Although SIG re-assured the public that the P320 design met industry standards regarding its drop safety, Sheperis's attorney, Jeff Bagnell, stated that the upgrade was telling.

[56] It claims that SIG Sauer "continued to sell the flawed gun to the public",[56] and that the upgrade offered "would still not fully compensate him for the significantly diminished resale value of his pistol".

[60][61] On 30 November 2022, a lawsuit was filed in U.S. federal court alleging several P320 pistols unintentionally fired "without the trigger being pulled or deliberately actuated by the user".

On March 15, 2019, Glock disputed the adoption of the P320 X-Carry into Danish military service, claiming the P320 did not meet DALO specification No.

The case was won by Leo Nielsen Trading ApS and Glock Ges.m.b.H as they proved the ejector could be assembled incorrectly, were paid 30,000 Danish krones, and the purchase was cancelled.