The basic configuration has 4KB of memory and no disk drives. These could be easily built-in, and the memory could be expanded up to 48KB.
Other changes were an extended Basic, better keyboard, expanded character set and a real time clock. The biggest change was the number of cables. To connect a fully operational TRS-80 Model 1 with one disk drive, you'd need 5 power sockets. The Model III had the same, but only used one power socket.
Soon after the Model III's release, the Model I was taken off the market. The Model 1 couldn't comply to the new rules of the FCC due to the electronic radiation.
The successor of the Model III followed in April 1983 and was called the Model 4.