Although the Thunderbird had been considered a rousing success, Ford executives—particularly Robert McNamara -- felt that the car's position as a two-seater restricted its sales potential. As a result, the car was redesigned as a four-seater for 1958. Though retaining a design as a two-door coupe/convertible, the new Thunderbird was considerably larger than the previous generation, with a longer 113.0 inches (2,870 mm) wheelbase to accommodate the new back seat. The increased size also increased the car's weight significantly by close to 1,000 pounds (454 kg). Along with a new, more rigid unibody construction was new styling, including dual headlights (for a total of four), more prominent tailfins, a bolder chrome grille, and a larger, though non-functional, hood scoop. Powering the Thunderbird was a new, 300 horsepower (220 kW) 352 cu in (5.8 L) FE V8, available with a 3-speed manual or automatic transmissions.

With 37,892 sold in 1958—outselling the previous model year by well over 16,000 units—the new Thunderbird began a sales momentum previously unseen with the car. It was also history-making, becoming the first individual model line (as opposed to an entire company) to earn Motor Trend "Car of the Year" honors. With little more than a new grille and a newly optional, 350 horsepower (260 kW) 430 cu in (7 L) MEL V8 for 1959, sales climbed even higher to 67,456.