Toyota will replace parts used in some 907,000 hatchbacks, named Voltz in Japan and Corolla and Corolla Matrix overseas, and produced between 2001 and 2004, a company spokesman said.
The control unit of the vehicles' airbags could be damaged by minor electrical noise, and "the airbag could open wrongly in a worst scenario," the spokesman said.
At least 47 cases of the malfunction had been reported, mainly in the United States.
"Two of them may be linked to accidents but there has been no death-related report," the spokesman said, adding that Toyota would exchange the troubled parts under each country's recall guidelines.
Toyota separately said it would recall some 385,000 Lexus IS cars globally to change windscreen wiper parts, following problems in snow.
Once lauded for its safety standards, Toyota has been forced into damage control mode in recent years after recalling millions of vehicles due to a series of serious defects.
Last month it said it had agreed to pay about $US1.1 billion to settle a class action lawsuit launched by US vehicle owners affected by a series of mass recalls.
But the automaker recaptured the title of world's biggest automaker from General Motors in 2012. On Monday it said its global sales last year soared 22.6 per cent to 9.75 million vehicles.