The Marder 1A3 was one of the most important upgrades of the Marder IFV. The vehicle was produced from 1988 to 1998 and around 2100 A1/A2 models were upgraded to this standard. The vehicle received more capable armour, intended to resist the 30 mm autocannon used by the BMP-2, which had started to be fielded by East Germany around the time of the upgrade. Other changes included an upgraded turret and upgrades to the suspension to avoid loss of mobility due to the increased weight.

It was introduced in Update "Direct Hit". The Marder 1A3 is an improvement over the Marder A1- with additional High Hardness armour plates added all around the hull that should make the vehicle better withstand autocannon rounds from a distance, though close-range side armour is still paper thin. The additional armour implemented on Marder 1A3 does make the vehicle slightly heavier than the Marder A1-, and while this should make impact mobility slightly, the difference in in-game performance in negligible. Armament between the two variants are similar too, with the Marder 1A3 retaining the MILAN ATGM and the 20 mm Rh202 autocannon. Armament differences lie in the APDS availability for the 20 mm autocannon and the removal of the rear-mounted MG3A1, which greatly improves versatility, as the new DM63 rounds can now penetrate BMP based hulls from 500 metres and other comparable IFVs within 1,000 metres, besides the Warrior.