The 2.7 litre 325iS (commonly called "Evo 1") was created by BMW South Africa to replace the 2.5 litre 325i in Group N production car racing, as a response to the introduction of the Opel Kadett 2 litre 16V to the Class A category. It was launched in the first half of 1990 and was powered by an Alpina-fettled, 2.7 litre M20 engine. The 325iS used aluminium doors, fenders and bonnet and was fitted with the 5-stud race-tuned suspension from the European BMW E30 M3 (which was not sold in South Africa).

Following the introduction of the upgraded Opel Kadett 16V SuperBoss, in 1991 BMW South Africa introduced the 325iS Evolution HP (commonly referred to as the "Evo 2") The Evolution HP was equipped with a front splitter/underbody tray to aid high-speed under-floor aerodynamics. The aluminium panels were no longer used, due to cost and repair-ability issues.

The Evolution HP won the Group N Class A title in 1993, winning 20 of the 24 races and setting several lap records in the process. The Robbi Smith and Geoff Goddard Evolution HP won the season-ending 9hr race by 10 laps.