The new device - a cheaper version of the tech behemoth's flagship phone - includes an updated chip and better wireless charging, alongside other new hardware improvements.
This allows for new upgrades, such as Apple's updated portraits feature that recognises animals and saves depth data so that photos can be blurred later on.
However, there are some drawbacks from the more expensive iPhone 17 and 17 Pro, including the fact that it only has a single camera.
The announcement of the iPhone17e comes at the start of a week of product launches for Apple, with the company also expected to unveil updated MacBooks and other devices.
It remains unclear whether Apple will make an announcement about an improved version of Siri, which it has long been working towards.
The upgraded virtual assistant will borrow technology from Google and will be capable of answering questions using the personal context it has about its owner.
The price of the iPhone17e will start at the same $599 or £599 as its predecessor, although it doubles the amount of starting storage to 256GB. It will be available in three colours; black, white and pink.
The phone comes with a 6.1-inch screen, the same as the iPhone16e that was released last year. This display has been upgraded with Ceramic Shield 2 glass, which Apple claims is three times harder to scratch and shows less glare.
The device also receives an upgraded modem - the C1X that is made by Apple itself - as well as improvements to the lone camera.
Bloomberg tech reporter Mark Gurman recently predicted that Apple would launch a range of products this week.
He said: "The company has told retail stores to expect an influx of customers in response to products being introduced this week.
"Some employees are even saying that the prelaunch planning is on par with what happens before the debut of new iPhones in the fall. That suggests Apple expects serious pent-up demand for the new offerings — and that at least one of the products will have major mainstream appeal."