Toyota introduced the fifth generation of the Starlet in 1996, but the car didn't confirm the same sales figures as its predecessors and, eventually, was withdrawn from the market three years later.

Designed as a low-budget vehicle, the Starlet made its appearance on the Japanese market in late 1989. In March 1990, Toyota introduced it to the European market.

The little Starlet evolved from a sporty little coupe with rear-wheel drive to an econobox with front-wheel drive that raised the Japanese carmaker popularity due to its reliability.