When the Austin-Healey Sprite Mark II was introduced in 1961, the MG marque already existed as a sister brand under the British Motor Corporation (BMC) banner. However, with the success of the Austin-Healey Sprite Mark I, MG was encouraged to start production of its own version in 1961.

The MG Midget was identical in almost every way to the Austin-Healey Mark II, except for some extra chrome trim and a nicer interior, including leather. Despite its dinky dimensions, the MG Midget was a sales smash. Designed as an affordable entry-level model, the tiny two-seater roadster combined eager performance, agile handling and wind-in-the-hair thrills with a low price and penny-pinching running costs.

As the MG Midget advertisement said, "The man behind the wheel of a Midget knows what it takes to make a fine sports car, a car that feels good because it hugs the road, corners firmly and stops when told."

Throughout the 1970s, the MG Midget was updated with more powerful engines and energy-absorbing black plastic bumpers to meet US safety requirements. However, with increased emission controls, especially in the US market, BMC could not modify the existing engines to provide sufficient power. With BMC unwilling to invest in a successor, the MG Midget Mark IV became the final model of the affordable roadster. The last MG Midget was manufactured in 1979.