The 1988 Honda Prelude ushered in the third generation of Honda's popular sporty coupe. The Prelude retained its appearance for the most part, growing just a little longer and wider. All Preludes got a bigger engine, and Honda introduced a new four-wheel-steering trim, which was designed to improve handling, especially around corners.

The 1988 Honda Prelude came in three trims: the base S model, the midrange Si, and the 4WS. The S had a 2.0-liter, 104 horsepower engine. The Si and the 4WS both came with a 2.0-liter, 135-horsepower engine, which was Honda's most powerful engine to date. The Si and 4WS were both well-equipped with things like power windows. All Preludes had a sunroof. Fuel economy was about 23/27.

The 1988 Honda Prelude has many fans who still drive them today. They say the car is a blast to drive, handling corners at high speeds with ease. They also say they are extremely reliable, and in the event there is a problem, they are very easy to fix. There are some complaints about the tiny backseat, and while some drivers find the four-wheel-steering interesting, most find it unnecessary.