The XJR was introduced as a high-performance sport model, and it was Jaguar’s first-ever supercharged road car and only the second Jaguar road car to use forced induction, after the Jaguar XJ220, which was turbocharged. The output of the six-cylinder AJ16 engine was increased to 321 hp (239 kW; 325 PS) and 378 lb⋅ft (512 N⋅m) with the use of an Eaton M90 supercharger and an air-water intercooler. The 0 to 97 km/h (0 to 60 mph) acceleration time was generally around the 5.9 for the manual transmission car to 6.6 second mark for the automatic. The XJR was fitted with larger 17 inches wheels, compared to 16 inches on the rest of the range, along Pirelli P-Zero tyres, with 10 mm lower firmer suspension and traction control. Almost all of the 6,547 XJR production cars were built with the optional GM 4L80-E automatic gearbox, although the Getrag 290 five-speed manual gearbox was the standard offering; only 268 were made, 102 in RHD for the United Kingdom market and the rest in LHD mainly in Europe with Italy taking 57.
Cosmetically, the XJR differed from the standard cars with a body-coloured grille surround, mesh grille insert, body-coloured boot-lid plinth, larger exhaust outlets, special five-spoke Sport alloy wheels, and XJR badging. Rain gutters and window surrounds were matte black, except on North American models where they were polished stainless steel. This generation of the XJR model carries the code name X306. It is also sometimes referred to as the XJR6 to differentiate it from the later V8-engined Jaguar XJ (X308) XJR.