British Leyland used a saloon design for the Allegro rather than a hatchback because it was decided that the Austin Maxi should keep the hatchback as its unique selling point. It was front-wheel drive, with the familiar A-Series engine and a sump-mounted transmission. The higher-specification models used the SOHC E-Series engine (from the Maxi), in 1500 cc and 1750 cc displacements. The two-box saloon bodyshell used the new Hydragas suspension system (derived from the previous Hydrolastic system used on the 1100/1300).

Stylistically, The Allegro went against the sharp-edged styling cues that were becoming fashionable (largely led by Italian designer Giorgetto Giugiaro), and featured rounded panel work. The original styling proposal, by Harris Mann, had the same sleek, wedge-like shape of the Princess, but because British Leyland management, keen to control costs, wanted to install the existing bulky heating system from the Marina, it became impossible to incorporate the low bonnet line as envisaged and the bodyshell began to look more and more bloated and tubby.

This was acceptable to BL management, however, who wanted to follow the Citroën approach of combining advanced technology with styling that ignored mainstream trends in order to create long-lasting "timeless" models. Its unfashionable shape was thus not a problem to them. The final car bore little resemblance to Mann's original concept that had originally been conceived as an 1100/1300 reskin. This, as well as British Leyland's faith in it as a model that would help turn the company around, led to it earning the early nickname of the "flying pig".

The poor reputation of the car and the inefficient production and management techniques in British Leyland at the time at which it was produced have meant that the Austin Allegro has become associated with waste, inefficiency and poor quality. Sir Digby Jones, in criticising the inefficiencies of the Learning and Skills Council, said, "It is what I call 'the British Leyland model' – you put a lot of money in at the top, and an Austin Allegro comes out at the bottom"