The M1A2 SEPv3 Abrams is the third iteration of the tank to undergo modernization under the System Enhancement Package (SEP) program. The upgrade aimed to enhance the vehicle's survivability, reliability, and combat effectiveness, and to integrate it into modern digital battlefield management systems. The tank received several upgrades as part of the modernization, including the Ammunition Data Link (ADL) system for programming advanced ammunition; improved thermal sights under the Improved Forward Looking Infrared (IFLIR) program; the CROWS remote weapon station; and the Advanced Multi-Purpose (AMP) round, which can operate in several modes and was added to its ammunition load. The M1A2 SEPv3 was first presented to the public in October 2015 at the Association of the United States Army (AUSA) exhibition in Washington, D.C.

In September 2018, the U.S. Army changed the designation system for future Abrams variants, and the M1A2 SEPv3 received the new designation M1A2C. The first tanks were delivered to the 3rd Battalion, 8th Cavalry Regiment, 1st Cavalry Division in July 2020. In December of that year, General Dynamics Land Systems received a $4.62 billion contract for serial production. In 2021, foreign customers also expressed interest in the variant, with Poland and Australia ordering 250 and 75 tanks, respectively.

The M1A2 SEPv3 was introduced in Update 2.57 "Heavy Cavalry". This new Abrams variant primarily stands out for its improved turret and hull protection, which allow it to play more aggressively and withstand damage from enemy APFSDS rounds better. Its ammunition load now includes the new M1147 HE round with a programmable fuze. Additionally, the Abrams received the "Camouflage Net" modification for better concealment on the battlefield. However, the tank's weight increased to 69.8 tons with the improved armor protection, negatively affecting its mobility.