The interior air in all E36 vehicles, except Z3, enters the cabin through a micro filter designed to remove pollen, dust and foreign matter from the air. Recommended replacement interval of this filter is 15,000 miles.

The micro filter on all other E36's is located in the back of the heater housing, and is accessed from behind the glove box. To access the micro filter does not require removal of the glove box, and I do not recommend it, purely because there are two screws that are difficult to get out. However, if you want to remove it, check here for instructions.

Remove the screws at the forward edge of the black panel below the glove box, there is one on each side of the footwell, screwed vertically into the glove box. Remove this panel by pulling the vertical section out from behind the console and then pulling the entire piece into the cabin. You may have your factory alarm control unit mounted to this piece. Unplug it and put the piece aside. Now look up and you will see the vents. The footwell vent system is held in place by 2 plastic rivets, with a little twisting, you will be able to pull the vent out, popping the rivets as you do so. If the micro filter has been replaced before, these rivets may no longer be present.

With the vent out of the way, look at the side of the heater box, you will see a little door with a twist knob on it, open this and it will reveal the micro filter. The micro filter has a small tab on it that you can grab and pull it out. If it is the original filter, it will be in one piece. You will need to break it on the way out to get clearance. If you look at the new filter, you will see 2 sets of score marks that allow the frame to be broken into 3 pieces. Break the old filter as you remove it and you can get it out past the glove box and wiring behind it.

Clean any leaves etc. out of the housing, and break the new filter into 3 sections. Now fold the filter insert one section at a time into the heater box. Do not totally separate the filter, break the plastic frame and the gray foam insulation around the edge, but make sure the white element remains intact.

Once the filter is entirely in the heater box, replace the door. If, for any reason, the twist knob breaks, or will not hold the door shut, there are several holes in the door and heater box to accept screws.

Remove the plastic rivet from the heater box where the vent enters, and insert the vent into its position. It is not necessary to replace the rivets, although often they will go back into place easily. If they cannot be put back into place, the lower panel will hold the vent in place correctly. Replace the lower panel, sliding it into place from the cabin, on the outer edge there is a small slot in the kick panel that receives this panel and on the inboard side are two metal tabs that slide through slots in the panel. Once in place, pull the plastic of the glove box at the front edge, below the panel, and insert the two screws.

E36/5 (Compact, 318ti) micro filter replacement
The hatchback E36 has 2 micro filters, they are located on the blower motor housing and accessed from the engine bay.

Look at the plastic grille below the centre of the windshield. There are 3 clips on the rear edge, pop these clips and the plastic grille will come out. Remove the 2 Phillips screws, that you have just exposed, holding the wiring harness to the cover and pull the harness case forward to unclip it from its rear mounts.

The section of the firewall you are working with is a separate piece and must be removed, there are two 7 mm screws on the right side, on just below the A/C lines and one behind the wiring harness where it enters the firewall. On the left there is one screw. Remove the 3 screws and pull the section up and to the right. There is a slot that runs along the bottom and up the left side, it must be pulled out of this slot, and put back into it during installation. Now remove the thin plastic cover and you will see 2 small micro filters mounted to the top of the blower housing. Note the orientation of the filters and replace them, There is a lip in the filter, and a channel in the housing, you must press the two together to secure them.

from koalamotorsport.com