The successor to FIAT's 1300/1500 sedan (known locally by the nickname "Tristaฤ‡") arrived on the European automotive scene in 1966. The development of the new 4-meter three-box car with exceptionally clean body lines (also offered in a more practical station wagon version) was overseen by engineer Oscar Montabone, who carried over only the 4-speed gearbox from its "retired" predecessor.

The model, which was named European Car of the Year the following year in its first edition, was powered by a 1.2-liter four-cylinder gasoline engine producing 60 HP, tasked with moving just 850 kilograms. The initial idea of having the engine drive the front wheels was not adopted, so the torque of the exceptionally smooth engine for its time was distributed to the rear axle.

With the 124 Special version arriving in 1968, featuring dual front headlight housings and an improved rear suspension, a 1.4-liter four-cylinder engine developing 70 HP was introduced. Two years later, the Special T version (T for Twin Cam) was offered to customers, bringing a 1.4-liter engine with dual overhead camshafts (80 HP) under the hood, along with disc brakes on both axles. The 80 "horses" in the lightweight body were enough for 160 km/h.

At the end of 1970, FIAT prepared a mildly redesigned edition with subtle changes to the radiator grille. The base model was "reinforced" with bumpers from the Special version, and all 124s received larger rear light housings and a centrally positioned reverse light. The brakes gained a servo booster, and the cabin received new ventilation openings and wood-imitation trim elements.

Before the arrival of its successor, known by the number 131 (Mirafiori), FIAT prepared another dual-overhead-camshaft engine for Special T customers from 1973 to 1974. The 1.6-liter four-cylinder developed a respectable 95 HP.

Compared to the original FIAT 124, a much more common sight in the former Yugoslav market was the significantly cheaper licensed product from the then-Soviet Union. There, from 1970 to 1982, a modified and mechanically simplified model (VAZ 2101 โ€“ Lada) was produced in over 15 million units.

In addition to the aforementioned arrangement with the Soviets, FIAT sold licenses for the production of the 124 model to automotive companies SEAT (Spain), TofaลŸ (Turkey), Premier (India), and Asia Motors (South Korea). Production in Italy ended in early 1975.