Suspension
Springs
Replacing your factory springs is a great step in improving your cars looks and handling. The best way to go is the Eibach Pro-kit. This kit will lower your mustang 1 1/2". It will look better and handle great. These springs can be used with factory shocks and struts but I recomend upgrading for a better handling car and better ride quality.
When lowering a mustang you really don't wanna go lower than 1 1/2". Sure 2"+ will look great but you will scrape on everything and your ride quality will be very bad.
There are many other spring kits available. Most made for the GT's will fit and work fine.
Eibach (Pro-Kit) Springs
Shocks And Struts
Any lowered mustang or just anyone that wants better suspesion should replace the factory shocks and struts.
Koni is probally the best you can get. You can get a kit with 2 adjustable rear shocks and 2 front struts. These kits can cost anywhere from $300 to $900+ but are well worth the money in handling.
Kenny Brown Suspension Kits
Koni Suspension
Control Arms
One problem with stock lower control arms is that they give under hard acceleration. As a result you could have problems with wheel hop especially if you have traction-loc. This problem can be fixed with aftermarket control arms. From what I have heard Steedas are very nice and will cost about $260 for a pair of lower control arms. When shopping keep in mind that and control arm that will fit a GT will fit a V6.
The upper control arms are similar to the lower ones but do less work. The stock ones are fine but if you've just got money laying around or your a serious racer than once again, I would go with Steeda. You can get a pair of upper control arms for about $200.
Kenny Brown Control Arms
Kenny Brown Control Arms
Misc..
Other upgrades to improve overall handling include strut tower braces, subframe connectors, roll bars, and sway bars. All of these stiffen the chassis of the car for better handling.
Roll Bar Kit
Strut Tower Brace and Subframe Connectors