The 2021 Toyota Highlander XSE arrived with a bit of a chip on its shoulder. For years, the Highlander was basically the ultimate "safe bet" for suburban families—reliable, spacious, and about as exciting as a plain bagel. Then Toyota decided to give it the XSE treatment. It wasn't just a badge swap or some fancy floor mats. They actually messed with the suspension.
If you’re looking at a used 2021 Toyota Highlander XSE today, you're likely wondering if that "sport" designation is just marketing fluff or if it actually changes how the car feels when you're taking a highway off-ramp at 40 mph.
Honestly, it’s a mix.
The first thing you notice isn't the drive, though. It’s the face. Toyota gave the XSE a completely different front fascia compared to the L, LE, or Limited trims. It’s got this aggressive, honeycomb grille and a sharper chin spoiler that makes it look like it’s squinting at you. It’s lower. It’s meaner. It’s also got 20-inch wheels with black accents that really pop if you find one in "Wind Chill Pearl" or "Celestial Silver Metallic."
What’s happening under the metal?
Most people think "Sport Edition" means more horsepower. It doesn't. Not here. You’re still getting the tried-and-true 3.5-liter V6 engine. It puts out 295 horsepower and 263 lb-ft of torque. It’s plenty. You’ll never feel like you can't merge onto the interstate. But the real magic—or the "X-factor" if you want to be cheesy—is the re-tuned suspension.
Toyota engineers increased the spring rates. They added a rear stabilizer bar. They even re-valved the shock absorbers to be a bit stiffer.
Why does this matter? Because a standard Highlander can feel a little "floaty." It’s designed to soak up bumps like a sponge. The 2021 Toyota Highlander XSE, however, feels more planted. When you turn the steering wheel, the body doesn't lean quite as much. It feels more like a large sedan and less like a boat. The electric power steering was also recalibrated to have a bit more weight to it, so you actually feel connected to the road.
It’s not a Supra. Let's be real. But for a three-row SUV that weighs over 4,000 pounds, it’s surprisingly composed.
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The Interior: Red leather and missed opportunities
Step inside and the XSE tries really hard to remind you it’s the "cool" trim. You could get it with this two-tone red and black leather-trimmed interior that is, frankly, pretty loud. Some people love it. Others find it a bit much for a grocery getter.
The dashboard layout is the same functional, ergonomic win that the 2021 generation is known for. You’ve got that massive shelf running along the bottom of the dash—perfect for stashing phones, snacks, or receipts you’ll forget to file.
Tech and Connectivity
- Standard 8-inch touchscreen (the 12.3-inch was mostly reserved for Limited/Platinum).
- Apple CarPlay and Android Auto are standard.
- Amazon Alexa integration.
- Five USB ports (because kids have iPads).
One thing that kinda bugs people about the 2021 model year is the infotainment interface. It’s functional, but it feels a bit dated compared to what Hyundai or Kia were putting out at the same time. The graphics are a little "Windows 7," but hey, it never crashes. Toyota builds things to last 300,000 miles, not to look like a smartphone from 2026.
Real world usability: The third row struggle
We need to talk about the back. The Highlander is a "three-row" SUV, but that third row is tight. If you have small kids, they'll be fine. If you try to put your 6-foot-tall brother-in-law back there for a three-hour road trip, he’s going to hate you.
The XSE comes standard with second-row captain’s chairs. This is a huge plus for accessibility. It creates a "middle aisle" that makes getting to the back way easier. But it also means you’re capped at seven passengers total. If you absolutely need eight seats, the XSE isn't your car. You’d have to drop down to an LE or an L trim to get that second-row bench.
Cargo space is "okay." With the third row up, you’ve got about 16 cubic feet. That’s enough for a few bags of groceries or two carry-on suitcases. Fold those seats down, though, and it opens up to 48.4 cubic feet. If you’re a DIYer or someone who hits up Costco every Sunday, you’ll mostly be driving with that third row flat.
Is it actually fuel efficient?
You’d expect a "sporty" V6 to guzzle gas. Surprisingly, the 2021 Toyota Highlander XSE is pretty reasonable for its size.
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The Front-Wheel Drive (FWD) version gets an EPA-estimated 21 city / 29 highway MPG.
The All-Wheel Drive (AWD) version drops that slightly to 20 city / 27 highway.
In the real world? Most drivers report averaging about 23 MPG in mixed driving. That’s solid. It’s better than a lot of the older V6 competitors like the Pilot or the Traverse from that same era. It’s also worth noting that the XSE doesn't come as a Hybrid. If you want those 35+ MPG numbers, you have to sacrifice the sporty suspension and the aggressive looks for the Highlander Hybrid trims. It's a trade-off. Style and handling vs. fuel pump savings.
Dynamic Torque Vectoring: The secret sauce
If you’re buying a 2021 Toyota Highlander XSE, try to find one with the AWD system. It’s not just for snow.
This specific trim uses Toyota’s Dynamic Torque Vectoring AWD. It’s a smarter system than the base AWD. It can send 50% of the power to the rear wheels and then distribute that power between the left and right rear wheels.
Imagine you’re taking a sharp right turn. The car can send more power to the outside rear wheel to help "push" the car through the corner. It reduces understeer. It makes the car feel smaller than it actually is. Plus, when you're just cruising on a flat highway, the system can disconnect the rear drive shafts entirely to save fuel. It’s clever engineering that actually has a tangible impact on how the car handles a rainy Monday morning.
What usually goes wrong?
No car is perfect. Even a Toyota. For the 2021 model year, there were a few common gripes.
Some owners complained about wind noise at high speeds, specifically coming from the side mirrors. Others mentioned that the transmission can sometimes feel a bit "hesitant" to downshift when you mash the gas pedal, as it’s tuned for fuel economy first.
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There were also some reports of the fuel tank not filling up all the way—a weird quirk that affected several Toyota models around that time. Usually, a quick trip to the dealer for a software update or a sensor check fixes it. But overall? The 3.5L V6 and the 8-speed automatic are basically bulletproof. You’re buying peace of mind.
Comparing the XSE to the competition
When this car came out, it was fighting the Kia Telluride and the Honda Pilot.
The Telluride has a much more luxurious interior. It feels like a Range Rover inside. But the Highlander wins on resale value. If you buy a 2021 Highlander XSE now and sell it in four years, you’re going to get a significant chunk of your money back. Toyota tax is real, and in this case, it works in your favor.
The Pilot is more cavernous inside, but it feels "older." The XSE feels like it was designed for the person who actually enjoys driving but was forced into a family car because they have two kids and a Golden Retriever.
Safety is non-negotiable
Toyota Safety Sense 2.5+ is standard on the XSE. You get:
- Pre-Collision System with Pedestrian Detection.
- Full-Speed Range Dynamic Radar Cruise Control (great for stop-and-go traffic).
- Lane Departure Alert with Steering Assist.
- Road Sign Assist (it literally reads speed limit signs and shows them on your dash).
It’s one of the highest-rated vehicles by the IIHS for that year. If safety is your primary driver, you can’t really do better in this price bracket.
Buying advice for the 2021 model year
If you’re hunting for one on the used market, check the tires. Those 20-inch rims look great, but the tires are more expensive to replace than the 18-inchers on the lower trims. Also, check the records for the AWD system maintenance if you’re looking at a high-mileage unit.
Look at the front bumper carefully. Because the XSE sits a bit lower and has that aggressive chin spoiler, it’s prone to scraping on high curbs or steep driveways.
Actionable Next Steps
- Check the VIN: Before buying, run the VIN through the NHTSA website to ensure all recalls (like the fuel pump or trim piece issues) have been addressed.
- Test the AWD: If possible, test drive an AWD version back-to-back with a FWD version. You’ll notice the difference in how the car "rotates" through corners.
- Verify the Tech: Ensure the Entune system has been updated to the latest firmware to avoid any smartphone connectivity glitches.
- Inspect the Seats: If the car has the red Cockpit Red interior, check the bolsters on the driver's seat for wear, as the synthetic SofTex can sometimes show creases earlier than genuine leather.
The 2021 Toyota Highlander XSE remains a standout choice for anyone who needs the utility of a big SUV but doesn't want to feel like they've totally "given up" on having a car with some personality. It balances that legendary reliability with just enough mechanical spice to keep your daily commute from being boring. High resale value, top-tier safety, and those aggressive looks make it a smart, if slightly loud, long-term investment.