The Smart Fortwo (stylized as "smart fortwo") is a two-seater city car manufactured and marketed by the Smart division of the Mercedes-Benz Group for model years 1998–2024, across three generations — each using a rear-engine, rear-wheel-drive layout and a one-box design.

The first generation was internally designated as the W450, launched at the 1998 Paris Motor Show. The second generation W451-build series was launched at the 2006 Bologna Motor Show. The third generation Fortwo (2014–2024) was internally designated as the C453 build series, and debuted globally on July 16, 2014, at the Tempodrom in Berlin along with a closely related four-door version, the Smart Forfour, co-developed and sharing the same platform and engines with the third-generation Renault Twingo.

Marketed in 46 countries worldwide, Fortwo production had surpassed 1.7 million units by early 2015. The brand name Smart supposedly derives from its early history as a cooperative venture between Swatch and Mercedes: Swatch Mercedes ART. The Fortwo nameplate derives from its two-person seating capacity. Until 2002, the Fortwo had been marketed as the smart City-Coupé.

Development of what ultimately became the Smart Fortwo started before 1993, originally as the Swatch car, developed by Nicolas Hayek in co-operation with Volkswagen. With a design focused on a modern microcar with an electric or hybrid drive, VW vacillated, disputes with Hayek ensued, and Hayek turned to Mercedes.

The company MCC (Micro Compact Car AG) was founded in 1994 by Hayek in Biel as a joint subsidiary of Daimler-Benz and SMH SA (Société Suisse de Microélectronique et d'Horlogerie). When MCC abandoned the original concept and the planned electric or hybrid drive, both Hayek and senior development team members left the project. "Today's gasoline-powered Smart is a product from Daimler-Benz and has not much in common with the plans of the former Swatch team."

The Fortwo is noted for its 2.5–2.69-metre (8.2–8.8 ft) overall length, high H-point seating, offset passenger and driver seats (in the first and second generation, the passenger seat is 15 centimetres further rearward than the driver's), automated manual transmission (1st and 2nd generation), De Dion tube rear suspension, low CO₂ emissions (119 grams per kilometre, North America, 1.0 Liter), two-part rear hatch, interchangeable plastic body panels and prominent steel hemispherical safety-cell, which is marketed as the Tridion cell and can be ordered in a contrasting color to the vehicle's body panels.

Fortwo models are manufactured at Smartville—a dedicated Daimler assembly plant in Hambach, France—in Coupé (i.e., hatchback) and Cabrio (i.e., convertible) body styles, each in a mono-box configuration.

Smartville underwent a 200 million euro upgrade beginning in mid-2013 for the third generation.^{[citation needed]}