Inspired by styling from the Dakar and Jeepster concept cars, the Liberty was intended as a replacement for the discontinued Jeep Cherokee (XJ). Three trim levels were initially offered; the top end Limited, a more rugged looking Renegade and the base Sport. All were made available with either 2WD or 4WD. In 2007, the Renegade trim level was replaced with the Latitude that appeared to focus more on an urban appearance.

The Liberty was the first Jeep to use two new PowerTech engines; the 150 hp 2.4 L I4, dropped in 2006, and the 210 hp 3.7 L V6. The VM Motori 2.8 L I4 common rail turbodiesel, became available in CRD branded 2005 2006 Sport and Limited models (2004 in the UK). The diesel utilized a variable geometry turbocharger and generated 160 horsepower (120 kW) and 295 pound-feet of torque. The overbuilt nature of the diesel powerplants added nearly 200 pounds to the CRD's curb weight versus the gasoline model. DaimlerChrysler introduced the CRD to gauge the marketability of diesel engines in North America; diesels are already common in Europe. The Liberty was also the first Jeep vehicle to use rack and pinion steering.

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The 2007 Jeep Liberty comes in two trim levels: Sport and Limited. The Sport features 16-inch steel wheels, air-conditioning, full power accessories, stability control and a six-speaker stereo with        CD player. The more up level Limited trim gets you amenities such as 17-inch alloy wheels, cruise control, a six-way power adjustable driver seat and a leather-wrapped steering wheel. 

One of the 2007 Liberty's highlights is its excellent safety standards.  For 2007, all Liberty models come with Jeep's Electronic Stability Program (ESP), anti-lock brakes (ABS), Electronic Roll Mitigation, and all-speed traction control. Side curtain airbags are available as an option. In NHTSA crash  tests, the 2007 Jeep Liberty earned a perfect five stars for driver protection in a frontal impact and four stars for front-passenger protection. Side-impact testing resulted in a five-star rating for        both front and rear passengers. The 2007 Jeep Liberty gets a decent interior space with room for five. The Liberty's rear seats are comfortable and there is reasonable leg room and head room for an adult.  The Liberty offers a generous amount of cargo space behind the rear seats. The theme of the Liberty cabin seems to be satin aluminum accents and chrome-ringed, black-on-white gauges. There are a total of 31 cubic feet of cargo space available behind the Liberty's split-folding rear seat and 69 cubic feet when that seat is folded down.