Despite moderate success during its run in the United States and several other export markets, it was criticized for its design, safety, and reliability,[2] though the car has also picked up a cult following.

[5] Near the end of its production run, Zastava sold an updated version of the Yugo Koral model, known as the Zastava Koral IN, which had central locking; a three-step rotary switch for leveling the headlamps in four positions; a four-speaker audio system; electric windows; folding electro-adjustable side-view mirrors, alloy wheels; optional air conditioner; and an optional Renault-designed three-speed automatic transmission.

Zastava sold these in Serbia, Montenegro, Croatia, Bosnia and Herzegovina, North Macedonia, Greece, Lebanon, Libya, Syria, Tunisia, and Egypt.

The Koral IN L, with a Peugeot fuel-injected 1.1 L-60 PS (44 kW) engine, met the European Union safety standards in a test supervised by the German Technischer Überwachungsverein (Technical Monitoring Association), a necessary step for importation to EU countries.

Zastava soon began exporting its new offering to other Eastern European markets, installing the bigger 128 overhead-cam engine for a top speed of 90 mph (145 km/h).

The parts production by Yugoslav republics was as follows: Early 1980-1985 models featured opening vent windows, round side indicators, only a single set of tail lights on each side of the car, no rear defroster, and usually a black interior with a black dashboard, and many metal trim pieces such as window crank handles and door handles.

Paint and antirust coatings were also well done during that period, evidenced by many cars still showing no signs of rust, tears in the seats, or major engine issues after more than 20 years.

Also, cars were usually branded Yugo instead of Zastava during that period, because the company was taking pride in the (at the time) good sales and reputation established in the export markets, especially in the United States.

Bricklin wanted to import additional brands, and international dealmaker Armand Hammer had been asked by the Yugoslavs to identify business areas in which they could generate exports to bolster their economy.

Hammer thought the idea of exporting the small cars made in Kragujevac, Serbia, by Zavodi Crvena Zastava, would be viable.

[11] The vehicles were to be renamed Yugo GV for the North American market and YugoCars, Inc. was formed in Sun Valley, California, by Kefurt and Ray Burns.

IAI's Tony Ciminera preferred using this larger, 1,100 cc engine making 55 horsepower, though it would drop fuel economy to the 30 miles per US gallon (7.8 L/100 km; 36 mpg‑imp) range, for it was faster and more able to keep up on North American freeways.

Ciminera carried out a bumper-to-bumper audit that resulted in more than 500 changes to meet the needs of the U.S. market, including compliance with American safety and emissions regulations.

The vast Yugo facility was patterned after the Fiat factories of the early 1950s and employed 50,000, divided among 85 basic associated labor organizations and 25 work committees.

[9] The chief engineer and head of Zastava's Research and Development Institute was Zdravko Menjak, who worked with Bricklin's people at the plant to monitor the effort, constantly stressing the need for high quality.

As a result, in mid-1986, Yugo America began selling cars at a starting price of $3,990 (equivalent to $11,090.6 in 2023) for the entry-level GV ("Good Value") hatchback equipped with the 1,100 cc overhead-cam five-main-bearing engine and four-speed manual transmission.

The similar GVL offered a plusher interior, but the sporty top-line GVX was powered by the 1,300 cc engine mated to a five-speed manual transmission, and included as standard equipment a number of deluxe features such as a ground-effects package, alloy wheels, and rally lights.

[15] There was also the GVC with a glass sunroof, the GVL with minor trim and upholstery upgrades, and finally the GVX with the 1,300-cc engine, five-speed manual transmission, and standard equipment including a plush interior, ground-effects package, alloy wheels, and rally lights.

In the late 1980s, an automatic transmission was being sourced from Renault and a larger model (named the "Florida") had been styled by Giorgetto Giugiaro and was in the early manufacturing stages.

[19] The noncompliant emission system used a carburetor of outdated design, an old-fashioned two-way catalytic converter with an air pump, and exhaust gas recirculation.

The power-reducing application of this primitive emissions control equipment on an already-weak engine was one of the major problems that caused the vehicles to get a reputation for poor drivability.

The new Yugo competed with indigenous cars such as the Austin Mini-Metro and Ford Fiesta MK1/MK2, captive imports such as the Vauxhall Nova (Opel Corsa A), and French models like the Citroën Visa and Talbot Samba.

The Sana might conceivably have established Yugo as a fixture in the United Kingdom market in the 1990s, but political developments left any such prospect unrealized.

Though the sanctions were not in place until May 1992, Yugos built between June 1991 and early 1996 were built with a variety of "leftover" parts: as an example, getting a car with a blue dashboard and a brown steering wheel, seats that were mismatched in color, and most likely an "American" instrument cluster with speeds printed in MPH rather than km/h, and with written labels like water and oil instead of small drawings, and a seatbelt safety warning light were possible.

During Easter 1999, the Zastava factory in Kragujevac was targeted by NATO forces during the Kosovo campaign, and whilst severely damaged, was not put out of action.

[9] However, Yugos have been rare in other former Yugoslav republics, particularly in Croatia where a total of only 3,040 Zastava cars were registered in 2020[31] and Slovenia, because most of them were "imported" back to Serbia in the early 2000s, most likely because most of them were in good shape for their age.

[33] Along with other Central and Eastern European vehicles marketed in the West during the 20th century—such as the Škoda—the Yugo was subjected to derision by critics who pointed to its use of old-generation Fiat technology and to alleged issues with build quality and reliability.

Despite the very low price setting in the U.S. (with Yugo being the cheapest new car ever sold in the U.S. when adjusted for inflation), it was ridiculed for the overall ugly design, poor quality, and large number of technical issues.

One was featured in season 5 episode 7 of Moonlighting as a gift of a "Practical" car for Dave Addison which met its ignominious end in an open grave.

In a voiceover, Dan Aykroyd identifies it as a 1987 model, and states it was the only vehicle the Los Angeles Police Department was willing to issue his character after his previous two cars were destroyed.