Volkswagen tightened its grip on the U.S. market in 1963, selling 217,124 cars, representing 62.3 percent of the import market and up 24.7 percent from the year before. The total broke down to 209,747 Sedans and 7,377 Cabriolets and VW commanded 3.2 percent of the entire U.S. new car market. In fact, the company postponed introduction of its new 50 bhp, 1500cc model until 1965, so busy were the present assembly lines.

Prices were unchanged from 1962, but from early in the 1963 model year a steel sunroof was offered as an option to the canvas one. It was the same color as the car but significantly smaller and prone to sticking, so many people chose the canvas top. Window guides were now plastic instead of cloth.

Oil fumes were now directed into the air cleaner instead of vented into the air. Plastic caps were fitted to spark plug terminals. Larger diameter intake ports were added to the 40 bhp engine. Heater vents had sliding covers and the system was modified to reduce oil fumes inside the car, while the windshield washer system was pressurized. The Wolfsburg crest disappeared from the hood and was replaced with Volkswagen.

Ten exterior colors were offered for the 1963 Volkswagen Beetle Sedans, and three were for the Standard model, which was very rare in the U.S. Colors were Black (L41); Pearl White (L87); Jupiter Gray (L225 Standard only); Rush Green (L344 Standard only); Gulf Blue (L390 also for Standard); Turquoise (L380); Ruby Red (L456); Anthracite (L469); Beryl Green (L478); Bahama Blue (L519).

Eleven 1963 Beetle Cabriolet colors were listed. They were Black (L41); Poppy Red (L54); Pearl White (L87); Turquoise (L380); Gulf Blue (L390); Pacific Blue (L398); Ruby Red (L456); Anthracite (L469); Beryl Green (L478); Yukon Yellow (L10009); Brunswick Blue (L100018).

Interiors could be cloth, leatherette, or combined. Cloth colors were Derby Grey, Medium Grey, or Derby Olive. Leatherette options were Silver Beige, True Red, Grey Cord, Black Cord and Soft Beige. Interior colors were coordinated with exterior paint. Sunroofs were Black, Pearl White, Jupiter Grey, Jade Green, Turquoise, Gulf Blue, Ruby Red, Anthracite and Beryl Green. Convertible tops were Black, Mouse Grey, Silver Grey, Blue Green and Olive Green. Headliners were white vinyl with perforations. Rubber mats were Grey.