The 1996 Mercedes-Benz S420 had a 275 horsepower, 4.2 liter, V8 engine. There were no cosmetic improvements to any S-Class vehicle, including the S420, in the 1996 model year.

A new Electronic Stability Program that applied brakes to individual wheels as needed was available as an option on the S420. Also new in 1996 was a 5-speed automatic transmission.

Users said the car was "extremely powerful" but "very smooth." The thermal-paned window, which all but eliminated road noise, were also a hit.