January 1995 saw the arrival of the Evolution 3- and this time the 5,000 strong production run was bought up more quickly than the Evolution 2. The Evolution 3 looked more serious, with its new nose molding (to channel air better to the radiator, intercooler, and brakes). New side skirts and rear corners, while the rear wing had grown again to reduce lift. Under the vented aluminum bonnet a new TDO5-16G6-7 Turbo, new exhaust system and increased compression brought another 10 PS (10 hp/7 kW) power rise, Torque output was unaltered, apart from a higher final drive ratio. Both GSR and RS still used the same 5 speed quafe gearbox. Interior tweaks were limited to a new Momo steering wheel (GSR only) and new fabric on the Evolution 2 type Recaros. The specs on this vehicle were an engine 4G63T size of 1997 cc, 270 bhp (201 kW) at 6250 rpm, torque was 228 lb·ft (309 N·m) at 3000 rpm, weight is 1260 kg (RS 1190 kg). A top speed of 149 mph (240 km/h) and 0-60 mi/h in 4.9 s.

The formidable CE9A Evo III was also featured in the manga and anime series Initial