The BMD-3 represents yet a further evolution of the BMD series of airborne combat vehicles, which also drew from experiences during the Afghanistan War. The BMD-3 was noticeably larger and heavier than its predecessors, and included a new uprated powerful engine as well as a hydropneumatic suspension. It also featured the same two-man turret as the BMP-2, as it was seen as superior to the one-man modified turret that was incorporated in the BMD-2. Like its predecessors, it could carry five fully equipped troops (firing ports were provided for two of them) although as many of eight could be fitted in an emergency. However, a major improvement was the ability to be airdropped with the crew inside the vehicle rather than parachuting them separately. Amphibious capacity was retained through two waterjets at the rear of the hull, and there is also a water pumping mechanism in case the hull is breached. The BMD-3 entered service shortly before the collapse of the USSR and as such, was produced in only limited numbers before being replaced by the BMD-4. A few remain in Russian Army service while others are being converted to BMP-4 standard.

The basic BMD-3 (Ob'jekt 950) was entered service in 1990. No major variants were designed before production switched to the BMD-4. The BMD-3’s chassis was eventually adopted into the Sprut-SD light tank, which incorporates a 125-mm cannon and is designed as a replacement for the venerable PT-76. The Sprut-SD is covered in a separate entry.