In order to understand the differences between the various types of upper receivers, it’s important to know what was going on with the REST of the rifle at the same time.
By 1996, the two newest versions of the M16 appeared, the M16A3 and M16A4. These differ from the M16A2 by having a removable carrying handle, with the upper receiver being fitted with a Picatinny-type accessory rail. Otherwise the M16A4 is similar to the M16A2, while the M16A3 also replaced the infamous three-round burst mode with a full auto mode. The key advantage of both the M16A3 and A4 rifles is the ability to quickly mount and re-mount a wide variety of optical, red dot or night vision / IR sights with MIL-STD 1913 (Picatinny-type) compatible mounts. The M4 carbine was also upgraded to “flat top” configuration, which is now standard.