The sleek, sporty look of the new A-Class contrasts sharply with its dowdy predecessor, favoured by the over-50s since it was launched more than a decade ago.
"We're looking for younger and more female customers," said Dieter Zetsche, the CEO of Mercedes' parent company Daimler.
The customer reaction so far had been positive, he said, calling the new design strategy on which the A-Class is based "an exclamation point."
"It visualizes how we are changing the company," Zetsche told reporters at the Geneva Motor Show.
Don't expect the premium brand to dive into the mainstream just yet, though.
Mercedes also rolled out seven other new models that resemble more closely the company's cool, conservative style.
These include the E-Class 300 BlueTEC, a business vehicle with diesel-hybrid propulsion, and the powerful SL 63 AMG.
All vehicles tout greater fuel efficiency, with the A-Class coming in at just under 99 grams of CO2 per kilometre. Zetsche said the company is aiming to get its fleet average down to 125 grams of CO2 per kilometre by 2015.
The Daimler CEO was upbeat about his company's prospects in a challenging global market for automobiles.
Worldwide sales for the industry are expected to grow by about four per cent, said Zetsche. "We very much believe that we will be better than that."