With the demise of the Homegrown Factory Suspension LXT for 1998, the Homegrown Factory Suspension XT became the entry-level model in the XC-oriented full suspension bikes featuring John Castellano's Sweet Spot® URT design. Though the 3.75 inches of rear suspension travel was the same as the Homegrown All Mountain line, the frame geometry and shorter-travel suspension fork make the Homegrown Factory Suspension' a sportier handler. As in 1997, the 6061 aluminum frames were made by Anodizing, Inc. in Portland, Oregon. An important change from the 1997 model is the addition of a Hayes 22mm direct mount on the rear triangle. This model was only available in "Bass Boat Orange" featuring Schwinn's new flag motif.
The Homegrown Factory Suspension XT featured a complete Shimano Deore XT group, including hubs, with an upgraded Deore XTR rear derailleur. The Titec titanium handlebar, stem, and seatpost found on the Homegrown Factory Suspension XTR were replaced with Titec's aluminum versions on the Factory Suspension XT. The Rock Shox Judy SL suspension fork was shared with the higher-end Homegrown Factory Suspension XTR and provided 80mm of travel, continuing the trend of 80mm forks used on Homegrown Factory Suspension models while Homegrown hardtails used 63mm travel forks.