Slightly larger than a football, the Cobalt Qube 3 is Sun's attempt to make serving e-mail, print files, Web sites and cached images easy to manage.
Users typically plug the appliance into their Ethernet network, set up the basic functions and then access other administrative tools via the Web.
The Qube is targeted at small businesses looking for a low-maintenance server, and larger businesses seeking a low-cost, single-job server.
Sun sells standard, business and professional editions of the Qube. All three versions will now come with 450MHz AMD K62 chips and run a tweaked version of Red Hat Linux, said Peder Ulander, senior director at Sun Cobalt.
The standard edition starts at $1,149 (£815) with 64Mbytes of memory and a 20Gbyte hard drive. The professional edition costs $2,099 (£1500) with 512Mbytes of memory and a 40Gbyte hard drive.
The latest release of the Qube can queue and serve up documents to a remote printer for users with Macintosh, Windows or Unix computers.
Users will also now be able to work with the Point to Point Tunneling Protocol (PPTP) and Internet Protocol Security (IPSec) standards for maintaining virtual private networks. Support for this networking technology should make it easier for companies to keep their networks secure and support remote workers.
Sun has also improved language support on the Qube 3 as well, with management options for English, German, Spanish, French, Japanese and Chinese speakers, Ulander said.
Sun claims Cobalt servers are attractive to customers with reduced IT budgets. The company positions the Cobalt line against low-end servers based on Intel chips and running Microsoft operating systems.