In 1989, Shelby's newest project differed from his previous. Shelby now decided to use the two-wheel drive shortbed Dakota Sport. The stock 125HP 3.9L V6 was replaced with the factory throttle-body injected 5.2L V8. Due to limited space, the stock engine fan was replaced with twin electric fans mounted in front of the radiator. This gave the vehicle a total of 175HP and 270 lb-ft of torque.
The transmission was a four speed automatic with locking torque converter with a 3.90 ratio limited slip diff. The heavy-duty suspension was carried over directly from the V6 Dakota Sport and the wheels were replaced with a Shelby five-spoke aluminum wheel shod with Goodyear Eagle GT+4s in 225/70HR-15.
Two colors were available: red or white. A large airdam with integrated driving lights was added and the trim pieces blacked out. A fiberglass light bar was placed behind the cab with decals along the sides featuring the Shelby name. A "V8" logo was attached to each fender and a "Shelby" decal was applied to the length of the vehicle.
The interior of all Dakotas was identical. A Shelby leather-wrapped steering wheel and the dash had two Shelby plaques. A four-speaker AM/FM cassette stereo was installed. The bench seat was covered in red with grey cloth insets with the "Shelby" added as accents. Gray cloth was also used as the insert in each door.