The second-generation Paseo was introduced in Japan in 1995, and for the 1996 model year in North America.
Apart from some modernizing in the engine electronics, the only noticeable change was in the body sheet metal.
A convertible model was shown at the October 1995 Tokyo Motor Show and was released for sale in August 1996.
This was the last year the Paseo was sold in the United States (1997 model year).

To reduce emissions levels, the second-generation Paseo's 5E-FE engine performance was reduced to the same specifications as the California CARB models, delivering 69 kW (93 hp; 94 PS) and 136 N⋅m (100 lb⋅ft) of torque.

The second-generation Paseo was sold in the United Kingdom from 1996 to 1998, but was withdrawn due to slow sales.
The UK market Paseo was offered in three trim levels: the base ST, the Si; adding 14-inch alloy wheels, a Sony CD player, color-coded boot spoiler with third brake light and an anti-lock braking system, and the Galliano, adding a color-coded chin spoiler, mud guards and yellow paintwork with aquamarine decals on the bodysides, as well as wider 15-inch alloy wheels with low-profile 195/50 tires.
The convertible model was not offered.
All UK models came with the 5E-FE engine producing 66 kW (89 hp; 90 PS).
The top speed, as claimed by Toyota, was 235 km/h (146 mph).

The Japanese market version was again named "Cynos".
Three trim levels were available: α, α Juno Package and β.
All came with color-coded wing mirrors and a rear windscreen wiper.
The models differed in their dashboards, interior upholstery, steering wheels and engines.
The Juno trim came with a 1.3 L 4E-FE engine with a 4-speed automatic transmission.
The α trim had the 1.5 L 5E-FE engine with a 5-speed manual transmission and the β trim came with a 5E-FHE engine, also with a 5-speed manual transmission.

Both the Paseo and Cynos were discontinued in 1999.
The second-generation Paseo was introduced in Japan in 1995, and for the 1996 model year in North America. Apart from some modernizing in the engine electronics, the only noticeable change was in the body sheet metal. A convertible model was shown at the October 1995 Tokyo Motor Show and was released for sale in August 1996. This was the last year the Paseo was sold in the United States (1997 model year).
To reduce emissions levels, the second-generation Paseo's 5E-FE engine performance was reduced to the same specifications as the California CARB models, delivering 69 kW (93 hp; 94 PS) and 136 N⋅m (100 lb⋅ft) of torque.
The second-generation Paseo was sold in the United Kingdom from 1996 to 1998, but was withdrawn due to slow sales. The UK market Paseo was offered in three trim levels: the base ST, the Si; adding 14-inch alloy wheels, a Sony CD player, color-coded boot spoiler with third brake light and an anti-lock braking system, and the Galliano, adding a color-coded chin spoiler, mud guards and yellow paintwork with aquamarine decals on the bodysides, as well as wider 15-inch alloy wheels with low-profile 195/50 tires. The convertible model was not offered. All UK models came with the 5E-FE engine producing 66 kW (89 hp; 90 PS). The top speed, as claimed by Toyota, was 235 km/h (146 mph).
The Japanese market version was again named "Cynos". Three trim levels were available: α, α Juno Package and β. All came with color-coded wing mirrors and a rear windscreen wiper. The models differed in their dashboards, interior upholstery, steering wheels and engines. The Juno trim came with a 1.3 L 4E-FE engine with a 4-speed automatic transmission. The α trim had the 1.5 L 5E-FE engine with a 5-speed manual transmission and the β trim came with a 5E-FHE engine, also with a 5-speed manual transmission.
Both the Paseo and Cynos were discontinued in 1999.
Toyota Paseo