SAN FRANCISCO—Can the iPhone bring sexy back?

With more than 128 million iPhones sold since 2007, the device’s ubiquity has created a marketing and design challenge for Apple Inc.: how to wow consumers in a maturing smartphone market where many alternatives now look and feel like Apple’s gadget.

That’s a challenge Apple will have to address Tuesday, when the company is widely expected to unveil a fifth-generation iPhone.

Apple has been working on an iPhone that is thinner and lighter with an improved eight-megapixel camera but details otherwise are unclear.

Now the question is, what features will be sufficient to dazzle consumers. For years, Apple has won converts in part because of the freshness of the iPhone’s design and software capabilities that didn’t exist elsewhere.

The company now faces tougher competition from smartphones using Google Inc.’s Android software, which also feature full-screen touch displays and access to thousands of apps. Some phones even out-flank the current iPhone: Motorola Mobility Holdings Inc.’s Droid Bionic has an eight-megapixel camera and access to high-speed, fourth-generation wireless networks. Android accounts for 43% of the U.S. market for smartphone operating systems, while Apple has 28%, according to Nielsen Co.

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