The new model was designed to firmly maintain the status achieved by the third generation as the bestselling car both domestically and globally. To do this, technology was pursued and polished on high international standards. From the time of its release, the fourth generation Corolla enjoyed a favorable reputation both in Japan and overseas, and for several months the new model was so popular that it could not be produced fast enough. Once again, the fourth generation Corolla gained a firm grasp of the status of bestselling car in the world.

At the time of the initial release in March 1979, five body types were available, including a sedan (2-door / 4-door), hardtop, coupe, liftback and van. However, in May of 1982 at the end of the fourth generation model period, a wagon — a popular body type even today in Japan — was added to bring the total to six for this generation.

Three types of engines were available, including the newly developed 1.5-liter OHC (Over Head Camshaft) 3A-U, the 1.3-liter OHV 4K-U inherited from the third generation, and the 1.6-liter DOHC (Double Over Head Camshaft) 2T-GEU. Also, in August 1979, five months after the fourth generation's release, the 1.8-liter OHV 13T-U engine was added to the lineup, but was discontinued in August 1981.

In August 1981 in the latter half of the model period, the 1.3-liter and 1.5-liter engines evolved to become the LASRE 3A-U II and LASRE 4K-U II engines, with LASRE (Light-weight Advanced Super Response Engine) added to their names.

In February 1982 at the end of the model period, the 1.8-liter OHC 1C diesel engine was adopted to respond to the needs of that era to conserve energy.

Sporty models were also aggressively pursued in the fourth generation. The Levin coupe, liftback, hardtop and 4-door sedan were equipped with the sporty 2T-GEU engine. In addition, sporty equipment was incorporated primarily around the driver's seat in models equipped with 1.5-liter engines, and entry-level sporty models were made available. On the other hand, other variations were made available to respond to the needs of users including a vehicle with specifications for handicapped passengers and a vehicle designed specifically for women.

The fourth generation Corolla was designed with consideration of aerodynamic performance — rather than maintaining the image of the third generation — and was transformed into a clean, boxy style with sharp lines. The wedged shape with a short nose and high deck significantly improved aerodynamic performance, riding comfort and practical utility. This fresh style drew a lot of attention. Also, the exterior design with its aerodynamic characteristics achieved a Cd value of 0.35 (European specification), a value that is not inferior to even modern day vehicles.

When the awareness of the target user class — a critical factor in determining design — was analyzed, the team found the group "had a taste for genuine articles," "was not deceived by shoddy workmanship," "would purchase what they liked even if it was expensive" and "would not switch to other vehicles as long as the car offered features to match their lifestyles." From this, Fumio Agetsuma encouraged the interior designers to "design the Corolla like a higher class vehicle." The design team was motivated to giving the interior a complete makeover. For example, while the rival cars were competing on the number of independent, eye-like meters surrounding the driver's seat, the team opted for a television-like design, and housed all the meters under a single lens. This was an entirely new idea for the time and established a trend that has continued through even today. Also, the switches were designed and positioned in a way that they shared the same sophisticated industrial design image of an Italian made typewriter. In addition, a design suited to a luxurious family car to lead the times was achieved by adopting a 2-spoke steering wheel and a sophisticated audio system.