The second-generation Impreza (GD sedan and GG wagon) debuted in August 2000 with a reinforced chassis that significantly increased torsional rigidity for enhanced safety and handling. Power was delivered by flat-four EJ-series petrol engines, including 1.5L, 2.0L, and 2.5L variants, paired with 5-speed or 6-speed manual transmissions as well as a 4-speed automatic, operating alongside Subaru's full-time Symmetrical AWD system. The engineering setup effectively combined the low center of gravity inherent to the horizontally-opposed engine layout with a rigid chassis frame, delivering precise handling and composure across dry pavement and slippery surfaces alike. Engine bay packaging ensured optimal front-to-rear axle weight distribution alongside efficient thermal cooling under sustained driving loads.

The exterior styling underwent two major facelifts: the initial 'Bugeye' look (2000–2002), followed by the 'Blobeye' redesign (2002–2005), and finally the 'Hawkeye' front fascia (2005–2007). Turbocharged WRX and STI performance models were equipped with 2.0-liter and 2.5-liter turbocharged boxer engines, cementing the car's popularity among enthusiast drivers until production ended in 2007. Designers placed a strong emphasis on cabin ergonomics, occupant visibility, and long-distance driving comfort. Robust mechanical reliability across the drivetrain and suspension components helped establish this generation as a benchmark choice within its competitive market segment worldwide.