The Dodge Challenger entered its second year of production in 1971, continuing to wear the low 'Coke Body' profile with full-width scoop-like grille, dual round headlights, and raised rear fenders introduced in 1970. Minor styling updates were made to the grille and taillight treatment, but the 225 cubic-inch Slant Six (the coupes were equipped with the 198 CID Slant Six) remained the standard engine.

Dodge had been the final company to release a completely new model for the muscle car market, more than five years after the first Mustang was released, yet the E-Body Challenger R/T made a formidable name for itself. The Challenger was one of two E-Body Chrysler cars, the other being the slightly smaller Plymouth Barracuda. Just like the Barracuda, the Challenger was offered in a plethora of trim and option levels and with nearly every engine within the Chrysler arsenal. Using a similar formula to the Ford and Chevrolet, the Challenger was based on a stretched, compact Dart platform (the Dart wheelbase was 110-inches and the Challenger was an inch longer). Body styles included a coupe, hardtop, and convertible with prices of $2725, $2,850, and $3,100 respectively in 1971. The R/T was offered solely as a hardtop, priced at $3,275. 1971 was the final year that Dodge built a factory convertible, until the mid-1980s. It was also the final year for the Hemi engine, and approximately 71 or 72 Challengers were equipped with the engine in 1971 (59 were four-speed cars and 12 had the TorqueFlite).

Dodge's winged Daytona was effectively banned by NASCAR in 1969, and as a result, Dodge withdrew much of their factory backing of stock car racing. They earned twenty-two Grand National victories in 1969, seventeen in 1970, and eight the following year. 1971 was the final year for the 'Hemi' V8 in street trim or racing form, mostly due to astronomical insurance premiums on high-performance cars and Federal regulations for 1972 requiring all cars to run on regular gasoline. Rather than sacrifice performance, Chrysler decided to retire it as a winner.

The Hemi 'Cudas came from the factory with a Shaker hood, but the Hemi Challenger did not include a shaker hood as standard but was part of the options list. It is estimated that fewer than a dozen cars were fitted with a Shaker hood.