The idea of installing a powerful engine in a post WWII mid-size car was introduced in 1957. The American Motors (AMC) Rebel showcased AMC?s new 327 in³ V8 255 hp with a 4 barrel carburetor (fuel injection was to be optional), thus making it the first American factory hot-rod hardtop sedan. The Rambler Rebel came with a manual or automatic transmission, and dual exhaust. The Rebel was promoted as the fastest four-door car in America from 0-60 mph and ran the quarter mile in 17.0 seconds. It was one of the quickest production automobiles at that time.

The popularity of the muscle car grew in the 1960s. Among these was the Pontiac Tempest. For 1964 and 1965, the GTO was an option package that included Pontiac's 389 in³ (6.5 L) V8 engine, floor-shifted transmission with Hurst shift linkage, and special trim. In 1966, the Pontiac GTO was no longer an option, and became its own model. The project, spearheaded by Pontiac division president John De Lorean, was technically a violation of General Motors policy limiting its smaller cars to 330 in³ (5.4 L) displacement, but it proved far more popular than expected, and inspired a host of imitations, both at GM and its competitors.

This marked a general trend towards factory performance, which reflected the importance of the youth market. A key appeal of the muscle cars was that they offered the burgeoning American car culture an array of relatively affordable vehicles with strong street performance that could also be used for racing. The affordability aspect was quickly compromised by increases in size, optional equipment, and plushness, forcing the addition of more and more powerful engines just to keep pace with performance. A backlash against this cost and weight growth led in 1967 and 1968 to a secondary trend of "budget muscle" in the form of the Plymouth Road Runner, Dodge Super Bee, and other stripped, lower-cost variants.

Although the sales of true muscle cars were relatively modest by total Detroit standards, they had considerable value in publicity and bragging rights, serving to bring young buyers into showrooms. Automakers saw these as halo models and some, such as the AMC Rebel Machine, were factory upgraded to be turn-key drag racers. The 1970 Machine even came with flamboyant and patriotic red, white, and blue reflective body graphics for maximum street and racetrack visibility. The fierce competition led to an escalation in power that peaked in 1970, with some models offering as much as 450 hp (and others likely producing as much actual power, whatever their rating).

The Dodge Charger, known for its appearance as the villan's vehicle in the movie BullittAnother related type of car is the car-based pickup. Examples of these are the Ford Ranchero, GMC Sprint, GMC Caballero, and one of the most famous examples, the Chevrolet El Camino.