The H3 was launched with a 3.5 liter straight-5 cylinder L52 engine that produced 220hp and 225 ft·lb of torque and was mated to a standard five-speed manual transmission or an optional Hydra-Matic 4L60-E four-speed automatic transmission. In 2007 this engine was replaced by 3.7 liter LLR that produced 242hp and 242 ft·lb of torque, figures that were revised in 2009 to 239hp and 241 ft·lb. Under revised EPA testing standards when equipped with either transmission this straight-5 engine achieves 14 miles per gallon in the city and 18 miles per gallon on the highway with a combined average of 15 miles per gallon. Available solely with the automatic transmission, a 5.3 liter LH8 V8 producing 300 hp and 320 ft·lb of torque was added in 2008 for the Alpha model of the H3 and returns slightly lower fuel economy estimated at 13 miles per gallon in the city, 16 miles per gallon on the highway, with a combined average of 14 miles per gallon.
The H3 features a two-speed, electronically controlled full-time four-wheel drive system that is suitable for both on-road and off-road driving in all conditions, with electronic locking front and rear differentials optionally available. Like its larger sibling the Hummer H2, the H3 can ford 24 inches of water (tested in depths up to 31 inches) at a speed of 5 miles per hour and 16 inches of water at a speed of 20 miles per hour. Standard ground clearance is measured at 9.7 inches while the approach, departure, and breakover angles are measured at 37.4°, 34.7°, and 22.1° respectively, allowing the H3 to scale a 16 inch vertical wall and negotiate grades of 60% and side slopes of 40%. Though fore and aft recovery hooks are standard, a trailer hitch and wiring harness are optional. Maximum towing capacities are 3000 lbs for the straight-5 with manual transmission, 4500 lbs for the straight-5 with automatic transmission, and 6000 lbs for the V8 with automatic transmission. Cargo volume with the second-row seats in the upright position is 25.0 cubic feet, which expands to a maximum of 62.8 when the seats are folded down. V8 models feature the lightest maximum payload capacity of just over 1100 lbs while straight-5, manual transmission models allow the greatest payload at 1300 lbs.