The Lionel Milwaukee Road GP-7 No. 2338 would be issued heading up both O and O27 sets beginning in 1955, and would be available for one additional year. This engine was equipped with Magnetraction, a horn that was operated by a D Cell battery, a three position directional unit whose control lever was adjustable from underneath the chassis, and single vertical worm drive motor that powers two axles. It was lighted at both ends, and heat-stamped numbers, and a rubber-stamped railroad hearld apperar on the sides. There are five variations:

Variation A: Hi-gloss ORANGE body that is painted BLACK. The ORANGE band goes all the way around the shell. The RED rubber-stamped railroad hearld did not adhere very well on this variation. This variation was an early production run and is rare. Numerous fradulent examples exist that have had the BLACK paint removed from the cab of the common version (Variation D).

Variation B: Hi-gloss ORANGE body that is painted BLACK. The ORANGE stripe ends at the cab and begins again. The interior is also painted entirely in BLACK. This was a stop-gap measure that Lionel used to stop the interior illumination from bleeding through the ORANGE plastic. Probably the second manufactured run of this diesel.

Variation C: BLACK body that is painted DULL ORANGE and FLAT BLACK. The BLACK body stopped bleed through from the interior lights. This variation is more difficult to find.

Variation D: Opaque ORANGE body painted BLACK. ORANGE stripe stops at cab, with a DARK RED or CHERRY RED railroad hearld rubber-stamped on the cab.

Variation E: Identical to Variation D except with Hi-gloss BLACK paint.

All of the Lionel GP-7 units will operate equally well on O and O27 gauge track.