The M3 possesses uncanny roadgoing ability. This is the most-agile car here. The steering eagerly bites into corners and is alive with feel… Even at the hairy edge of traction, the M3 is accepting of further driver input, which builds tremendous confidence. Unlike the Acura NSX, the Dodge Viper, or even the Ferrari F355, you feel free to explore the M3's limits without fear that something awful awaits if you miscalculate.
Car and Driver September 1997: "The Best-Handling Car for More Than 30K"

The BMW shows its power best coming off a corner when its heady torque insanely rockets the car from any apex. In ultimate handling, the M3 has the clear advantage. The BMW's 69.4-mph eruption through MT's 600-foot slalom has been equaled only by the Ferrari F355, Porsche 911 Turbo, and Dodge Viper GTS among all current production cars. That's impressive company, and what's more amazing is that the M3's steering response may be the best of the bunch. Matching that dynamic performance are awesome brakes (60-0 mph in 113 feet). Around a tight road course, the M3 could well be the quickest production four-door ever.
Motor Trend April 1997, "BMW M3 vs. Mercedes-Benz C36"

From a BMW Brochure...

BMW M cars have long been recognized as the epitome of high performance and refinement. Building on BMW Motorsport's racing heritage, the long-awaited M3 is born of a tradition of innovative technology, sophisticated engineering and the determination to create one of the most exciting automobiles ever offered to Canadian driving enthusiasts.

The M3 was originally developed by BMW's racing department. BMW M cars reflect the synergy between BMW's racing heritage and production models built for daily use. As a result, the M3's motorsport successes and the numerous European and World Championship titles can now be enjoyed as a production car, available as coupe or sedan.

BMW's four-valve technology provides one of the highest specific torque and power outputs of any production engine worldwide. Exceptionally low gas-flow restrictions of the cylinder head ports guarantee optimized gas exchange, resulting in excellent low speed torque and "free-breathing" at high revs Engine management is provided by Digital Motor Electronics (DME), individual ignition coils, cylinder-selective knock control and VANOS variable camshaft control.

Digital Motor Electronics (DME) analyzes and then actually fine-tunes the engine hundreds of times a second. Each cylinder is constantly adjusted to maximum operating efficiency under virtually all conditions. DME even has many fail-safe programs: in the unlikely event of an electrical fault, it can reconfigure itself to bypass the problem. And DME has the incredible ability to diagnose itself for quick and efficient trouble-shooting.

VANOS is a combined hydraulic and mechanical camshaft control device managed by the car's DME engine management system. It operates on the inlet camshaft in accordance with engine speed and accelerator pedal position. At the lower end of the engine-speed scale, the inlet valves are opened later, which improves idling quality and smoothness. At moderate engine speeds, the inlet valves open much earlier, which boosts torque and permits exhaust gas recirculation inside the combustion chambers, so that fuel consumption and exhaust emissions are both reduced. Finally, at high engine speeds, inlet valve opening is once again delayed, so that full power can be developed.