At the time of its initial release, the second generation Corolla adopted the 1.2-liter 3K engine continued from the first generation model. However, shortly after its release, the newly developed 1.4-liter T engine was added to the lineup with a maximum output of 86ps/6000rpm and a maximum torque of 11.7kg-m/3800rpm to further improve dynamic performance and support the high speed era that was sure to come. While it shared similar fundamental structures with the K engine, cross-flow type intake and exhaust ports and double rocker shafts were adopted to improve intake and exhaust efficiency. In addition, rather advanced mechanisms for that time were adopted, such as a hemispherical combustion chamber used to increase combustion efficiency.

The "Corolla Levin," considered to be the top-of-the-line sporty model, was equipped with a 1.6-liter 2T-G engine. Twin Solex carburetors were coupled with the newest DOHC layout to achieve high performance with a maximum output of 115ps/6400rpm and a maximum torque of 14.5kg-m/5200rpm. The Corolla Levin equipped with this powerful engine demonstrated spectacular success in all types of motor sports, and, as a result, the 2T-G became a legendary unit in the history of Toyota engines.

In addition, an abundant array of appealing mechanical features was also adopted in the second generation Corolla. While the 4-speed transmission was in its heyday in this class at that time, Toyota opted to equip the sporty models with a 5-speed transmission with an overdrive gear ratio. For the front suspension, a MacPherson strut suspension with a torsion bar type stabilizer was incorporated, and, for the rear suspension, the length of the leaf spring was expanded to achieve excellent riding comfort and handling stability.

High seatbacks with built-in headrests were adopted in the second generation Corolla for seating comfort and safety. At the same time, the seat sliding range was expanded to ensure latitude in the driving position.

Considerations were also made for storage space, and an accessory storage compartment was provided together with the armrests in the rear trim of the 2-door models. Also, heater switch and ashtray illuminations were provided for better nighttime usability.

A characteristic design feature of the second generation Corolla was the discontinuation of the triangular windows in the front doors. With this move, efforts were made to enhance interior ventilation, and blower registers were provided to the left and right of the instrument panel. In addition, this model featured amenities such as an AM/FM radio, car stereo and air conditioning to portray a lavish interior.

The second generation lineup offered more models equipped with disc brakes. These models were also equipped with proportioning valves to keep the rear wheels from locking during hard braking. In addition, high grade models adopted tandem master cylinders as standard equipment to enhance stopping power to accommodate the increased output from the engine. Furthermore, window washers and conical glare-proof meter glass were adopted as standard equipment in consideration of safety.