Steve Guttenberg turned down the lead role for this and all other sequels in the original Police Academy septology. Two decades later, Guttenberg expressed his regret at turning down the later sequels, and was among the main people trying to make another Police Academy movie.
When Police Academy 4: Citizens on Patrol (1987) was released, acerbic critic Rex Reed swore, "If they make another Police Academy movie, I'll leave the business." At the time, Paul Maslansky said, "Reed's one of the reasons I'm making Police Academy 5. I expect him to be a man of his word." To Maslansky's disappointment, Reed was not.
Regarding his experience working on this film, Rene Auberjonois (Tony) stated, "Why I choose to do things is a mystery to me sometimes. I've done things that, on the face of it, you think, 'why would anybody do Police Academy 5?' I had to look at the role, and see if there's a reason to do it. I did it because it was an opportunity to play a character that nobody else was ever going to let me play. I had a great time doing it, don't regret it for a moment, and I'd do it again in a minute."
Bobcat Goldthwait did not reprise his role of Zed due to not being able to come to a financial agreement with the producers. Because of this, the filmmakers believed that there was no point in bringing back Sweetchuck without Zed, and so Tim Kazurinsky ended up not being involved either. Bobcat later said that he skipped this sequel because the script lost focus and his character "would never talk like that."
Had Steve Guttenberg agreed to appear in the movie, his character Mahoney was to be promoted to Lieutenant at the end of the film.