During 1986, FMC began production of an improved variant of the Bradley designated the M2A1/M3A1. This improved model was based on Research and Development (R&D) work carried out by FMC's Ground Systems Division, the Arm> Tank Automotive Command (TACOM). field reports and intelligence data.

The most significant improvement in the new variant was the installation of an improved TOW-2 missile system. The improved TOW had a large warhead, improved fuel, shorter llight time and better angle of attack. This newer, more power system was needed to combat the improved T64 and T72 series of Russian tanks which were coming into service and were capable of surviving hits from the older TOW system used on the M2/M3 series. While the earlier TOWs could handle the T55 and T62 models, the new-Soviet MBTs had thicker, more advanced armor. The new TOW launcher has a slightly revised launcher cover, which has a rounded bottom edge.

In addition to the new TOW system, there were a number of external changes to the M2A1/M3A1. The rear turret stowage basket was redesigned, having a straight back instead of the slanted hack used on the M2/M3. On the M3A1. the firing pons were deleted and replaced with solid armor on the sides and rear. The M3A1 also has a redesigned rear upper hatch with four periscopes (which replace the rear periscopes of the M2A1). The scout's seats were also relocated under the hatch to make it easier for the scouts to use them.

Other changes included the removal of the grenade ammunition boxes from the front of the turret, improved flotation screen brackets and an improved auto-interrupter to prevent the 25mm gun from damaging various hull linings. The driver's hatch was modified, with a step guard being installed over the hatch periscopes to protect them.

Internally, a new NBC system was added, mounted in the turret bustle. This system allowed all the crew, along with the scouts in the M3A1. to breath filtered air through a hose rather than individual units. In the M2A1 the infantry squad was not provided with this option, since their constant movement in and out of the Bradley would mean numerous changes from one system to another, exposing them to needless danger.