(Rule 14a-101)

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934 (Amendment No.  )

POLARIS INDUSTRIES INC.

(Name of Registrant as Specified in Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Polaris Industries Inc.

March 1, 2006

Dear Fellow Shareholder:

      The Board of Directors of Polaris Industries Inc. joins me in extending a cordial invitation to attend our 2006 Annual Meeting of Shareholders which will be held at our corporate headquarters, 2100 Highway 55, Medina, Minnesota 55340, on Thursday, April 20, 2006 at 9:00 a.m. local time.

      In addition to voting on the matters described in the accompanying Notice of Annual Meeting and Proxy Statement, we will review Polaris’ 2005 business and discuss our direction for the coming years. There will also be an opportunity, after conclusion of the formal business of the meeting, to discuss other matters of interest to you as a shareholder.

      It is important that your shares be represented at the meeting whether or not you plan to attend in person. Please vote by returning your signed proxy card in the envelope provided or by using the telephone or Internet voting options indicated on the proxy card. If you do attend the meeting and desire to vote in person, you may do so even though you have previously sent a proxy.

      We hope that you will be able to attend the meeting and we look forward to seeing you.

      Enclosures

POLARIS INDUSTRIES INC.

2100 Highway 55

Medina, Minnesota 55340

March 1, 2006

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

      Polaris Industries Inc. will hold its 2006 Annual Meeting of Shareholders at its corporate headquarters located at 2100 Highway 55, Medina, Minnesota 55340, on Thursday, April 20, 2006. The meeting will begin at 9:00 a.m. local time. At the meeting, we will:

             • One Class II director for a two-year term ending in 2008; and

             • Three Class III directors for three-year terms ending in 2009.

      The Board recommends that shareholders vote FOR the director nominees named in the accompanying Proxy Statement. The Board recommends that shareholders vote FOR the approval of the amendments to the Company’s Employee Stock Purchase Plan, as each is described in the accompanying Proxy Statement.

      Only shareholders of record at the close of business on February 21, 2006 may vote at the Annual Meeting or any adjournment thereof.

YOUR VOTE IS IMPORTANT

      Whether or not you plan to attend the meeting, we urge you to vote as soon as possible by telephone, Internet or mail.

TABLE OF CONTENTS

POLARIS INDUSTRIES INC.

2100 Highway 55

Medina, Minnesota 55340

PROXY STATEMENT

QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING AND VOTING

SECURITY OWNERSHIP OF CERTAIN

BENEFICIAL OWNERS AND MANAGEMENT

      The following table sets forth certain information with respect to the beneficial ownership of the Company’s common stock as of February 14, 2006 by each person known to the Company who then beneficially owned more than 5% of the outstanding shares of common stock, each director of the Company, each nominee for director, each executive officer named in the Summary Compensation Table on page 24 and all current executive officers and directors as a group. As of February 14, 2006, there were 41,548,512 shares of common stock outstanding. Except as otherwise indicated, the named beneficial owner has sole voting and investment powers with respect to the shares held by such beneficial owner. The table also includes information with respect to common stock equivalents credited as of February 14, 2006 to the accounts of each director under the Company’s Deferred Compensation Plan for Directors that is described in this Proxy Statement under the heading “Corporate Governance — Director Compensation.”

Stock Ownership Guidelines

      Our Board of Directors has adopted stock ownership guidelines, which provide that each non-employee director is expected to own, directly or indirectly, on January 22, 2007, shares of Polaris common stock or common stock equivalents having a value of at least three times the amount of the annual retainer fee paid to such director. Each non-employee director who is elected for the first time after January 23, 2003 will be expected to satisfy such guidelines at the end of a period of four years commencing on the date such director is elected. The stock ownership guidelines also provide that the Chief Executive Officer and other executive

officers of the Company are expected to own, directly or indirectly, shares of common stock or restricted share awards having a value of at least five and three times, respectively, their annual base salaries. The Chief Executive Officer and other executive officers of the Company that held office as of January 23, 2003 currently satisfy these guidelines and any person becoming an executive officer of the Company after January 23, 2003 will be expected to satisfy the guidelines at the end of a period of four years commencing on the date of becoming an executive officer of the Company.

CORPORATE GOVERNANCE

Corporate Governance Guidelines and Independence

      Our Board of Directors has adopted Corporate Governance Guidelines, which may be viewed online on our website at www.polarisindustries.com or may be obtained in print by any shareholder who requests it. Under our Corporate Governance Guidelines, which adopt the current standards for “independence” established by the New York Stock Exchange (“NYSE”), a majority of the members of the Board of Directors must be independent as determined by the Board of Directors. In making its determination of independence, among other things, the Board of Directors must have determined that the director has no material relationship with Polaris either directly or indirectly as a partner, shareholder or officer of an organization that has a relationship with Polaris. The Board of Directors has determined that Ms. Clayton and Messrs. Caulk, Fruhan, Menard, Schreck and Zona are independent. The Board of Directors has also determined that Mr. Baltins is independent for all purposes other than service on the Company’s Audit Committee because he is a member of one of the law firms that provides legal services to the Company. Mr. Palen, our non-Executive Chairman of the Board, is the Chairman and Chief Executive Officer of Spectro Alloys, an aluminum manufacturing company that served as a supplier to the Company until June 2003. Under our Corporate Governance Guidelines, Mr. Palen will be regarded as non-independent until June 2006, three years following the termination of the Spectro Alloys relationship with Polaris. Mr. Pierer is not considered to be independent by the Board of Directors based on his relationship to Cross Industries AG under the Call Option Agreement (as described under “Corporate Governance — Certain Relationships and Related Transactions” on page 11 of this Proxy Statement). Mr. Tiller, our Chief Executive Officer is not considered to be independent by the Board of Directors. Accordingly, a majority of our Board of Directors is considered to be independent. Additionally, all current members of our Audit, Compensation and Corporate Governance and Nominating Committees are considered to be independent.

      We have also adopted a Code of Business Conduct and Ethics applicable to all employees, including our Chief Executive Officer, our Chief Financial Officer and all other senior executives, and the directors. A copy of the Polaris Code of Business Conduct and Ethics is available on our website at www.polarisindustries.com and in print to any shareholder who requests it.

Communications with the Board

      Under our Corporate Governance Guidelines, a process has been established by which shareholders may communicate with members of the Board of Directors. Any shareholder who desires to communicate with the Board of Directors, individually or as a group, may do so by writing to the intended member or members of the Board of Directors, c/o Corporate Secretary, Polaris Industries Inc., 2100 Highway 55, Medina, Minnesota 55340.

      All communications received in accordance with these procedures will be reviewed initially by the office of our Corporate Secretary to determine that the communication is a message to our directors and will be relayed to the appropriate director or directors unless the Corporate Secretary determines that the communication is an advertisement or other promotional material. The director or directors who receive any such communication will have discretion to determine whether the subject matter of the communication should be brought to the attention of the full Board of Directors or one or more of its committees and whether any response to the person sending the communication is appropriate.

Director Compensation

      Directors who are employees of the Company receive no compensation for their services as directors or as members of committees. Compensation for non-employee directors is divided into cash and stock components. The Company presently pays each non-employee director other than our Chairman, Mr. Palen, an annual director’s fee of $40,000. At least $5,000 of the annual director’s fee paid to each non-employee director other than Mr. Pierer will be payable in common stock equivalents (as described below). Mr. Palen, our non-executive Chairman of the Board of Directors, currently receives an annual fee of $100,000 in lieu of the annual director’s fee received by other non-employee directors. The Chairs of the Audit Committee, Compensation Committee, Corporate Governance and Nominating Committee and Technology Committee currently receive an annual committee chairman’s fee of $10,000. Non-employee directors, other than Mr. Pierer, also receive $1,000 for each committee meeting attended, which fees they may choose to defer under the Deferred Compensation Plan (as described below).

      The Company maintains a deferred compensation plan, the Polaris Industries Inc. Deferred Compensation Plan for Directors (the “Deferred Compensation Plan”), for directors who are not officers or employees of the Company (“Outside Directors”). Mr. Pierer does not participate in the Deferred Compensation Plan. As of each quarterly date on which retainer fees are payable to Outside Directors, each Outside Director automatically receives an award of common stock equivalents having a fair market value of $1,250. An Outside Director can also defer all or a portion of the director and/or chair and committee fees that would otherwise be paid to him or her in cash. Such deferred amounts are converted into additional common stock equivalents based on the then fair market value of the common stock. These “common stock equivalents” are phantom stock units, i.e., each common stock equivalent represents the economic equivalent of one share of common stock. Dividends will be credited to Outside Directors as if the common stock equivalents are outstanding shares of common stock. Such dividends will be converted into additional common stock equivalents.

      As soon as practicable after an Outside Director’s service on the Board terminates, he or she will receive a distribution of a number of shares of common stock equal to the number of common stock equivalents then credited to him or her under the Deferred Compensation Plan. Upon the death of an Outside Director, the shares will be issued to his or her beneficiary. Upon a change in control of the Company (as defined in the Deferred Compensation Plan), however, each Outside Director will receive a cash payment equal to the value of his or her accumulated common stock equivalents.

      A maximum of 200,000 shares of common stock are reserved for issuance under the Deferred Compensation Plan. Of that total, 71,038 shares of common stock remained available for future grants as of February 14, 2006. The Deferred Compensation Plan will remain effective until May 31, 2010, unless terminated earlier by the Board of Directors. The Deferred Compensation Plan may be terminated or amended at any time by the Board of Directors.

      Under the 2003 Non-Employee Director Stock Option Plan, each non-employee director, other than Mr. Pierer, who is elected at an annual meeting of shareholders or who continues to serve as a director after such annual meeting will receive an automatic annual grant of stock options to purchase 4,000 shares of the Company’s common stock at an exercise price equal to fair market value on the date of grant.

      Additionally, the Company makes Polaris products available to its Outside Directors at no charge to encourage a first-hand understanding of the riding experience of Polaris customers.

Board Meetings

      During 2005, the full Board of Directors met eight times, four of which were in person. Each of the in-person meetings was preceded and/or followed by an executive session of the Board of Directors without management in attendance, chaired by either Mr. Palen or the chair of the Corporate Governance and Nominating Committee. Each of our directors attended 75% percent or more of the meetings of the Board of Directors and any committee on which they served in 2005. The Board also acted through one written action in 2005. The Company does not maintain a formal policy regarding the Board’s attendance at annual

shareholder meetings; however, Board members are expected to regularly attend all Board meetings and meetings of the committees on which they serve. All members of the Board of Directors attended our 2005 Annual Meeting, except for Stefan Pierer, who was elected to the Board effective October 20, 2005.

Committees of the Board and Meetings

      The Board of Directors has designated four standing committees. The Audit Committee, the Compensation Committee, the Corporate Governance and Nominating Committee and the Technology Committee each operate under a written charter which is available for review on our website at http://www.polarisindustries.com and is also available in print to any shareholder who requests it. The Executive Committee, which was previously designated as a standing committee, was formally dissolved by the Board of Directors on October 20, 2005 following a determination that the role of the Executive Committee, as originally contemplated, was being performed by other standing committees. The current membership of each committee and its principal functions, as well as the number of times it met during fiscal 2005, are described below.

Certain Relationships and Related Transactions

      The law firm of Kaplan, Strangis and Kaplan, P.A. (“KSK”) provides ongoing legal services to the Company and certain subsidiaries in connection with various matters. Andris A. Baltins, a member of the Board of Directors, is a member of that firm. During 2005, KSK received $719,739 in legal fees from the Company.

      Gregory R. Palen, the non-Executive Chairman of the Board of Directors, is the Chairman and Chief Executive Officer of Spectro Alloys, an aluminum manufacturing company that served as a supplier to the Company until June 2003. Under our Corporate Governance Guidelines, Mr. Palen will be regarded as non-independent until June 2006, three years following the termination of the Spectro Alloys relationship with Polaris. Mr. Palen voluntarily resigned from the Audit Committee and the Corporate Governance and Nominating Committee in January 2004 in order that such committees be comprised of independent directors as required under the current NYSE rules. The Audit Committee is currently comprised of Messrs. Fruhan and Zona and Ms. Clayton, all of whom are independent directors. The Corporate Governance and Nominating Committee is currently comprised of Messrs. Baltins, Fruhan, and Schreck, all of whom are independent directors.

      On August 11, 2005 and September 7, 2005, the Company, through its Austrian subsidiary, purchased a 25% interest in KTM Power Sports AG (“KTM”) from an institutional investor. On July 18, 2005, the Company entered into a Call Option Agreement (the “Call Option Agreement”) with respect to the shares of KTM with Cross Industries AG (“Cross”). The shareholders of Cross are Pierer GmbH and Knünz GmbH, each beneficially owning 50% of the share capital and the voting rights of Cross. Stefan Pierer, a member of our Board of Directors, beneficially owns 100% of the share capital and voting rights of Pierer GmbH. The Call Option Agreement grants each party a series of call rights to acquire the other’s ownership interest in KTM, which rights generally become exercisable in October 2007. Upon the occurrence of certain events, such as the death of key members of KTM’s management or a change in control of the Company, the vesting of these call rights may be accelerated. The purchase price per share for the call rights will be formula-based depending, in part, upon the financial performance of both companies for the 12-month period ending on the measurement date. In the event the Company exercises its call right, the purchase price may be payable in cash or a combination of cash and shares of the Company’s common stock; however, the Call Option Agreement provides that the price must be paid entirely in cash if, at the time such price becomes payable, Mr. Pierer is not serving as a member of the Company’s Board of Directors for any reason other than death, disability, resignation or because Mr. Pierer declined to stand for election to the Company’s Board of Directors.

Compensation Committee Interlocks and Insider Participation

      All current members of the Compensation Committee are considered independent under our Corporate Governance Guidelines. No interlocking relationships exist between the Board of Directors or the Compensation Committee and the Board of Directors or compensation committee of any other company.

Section 16 Beneficial Ownership Reporting Compliance

      Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the Company’s directors and executive officers to file initial reports of ownership and reports of changes of ownership of the Company’s common stock with the SEC. Executive officers and directors are required to furnish the Company with copies of all Section 16(a) reports that they file. To the Company’s knowledge, based solely upon a review of the reports filed by the executive officers and directors during 2005 and written representations that no other reports were required, the Company believes that, during the year ended December 31, 2005, all filing requirements applicable to its directors, executive officers and 10% beneficial owners, if any, were complied with, except that the Company inadvertently failed to timely file a Form 4 for Jeffrey A. Bjorkman with respect to the sale of an aggregate of 280 shares by two of his children on July 25, 2005.

AUDIT COMMITTEE REPORT

      The Audit Committee reports to and acts on behalf of the Board of Directors by providing oversight of (1) the integrity of the Company’s financial statements, (2) the Company’s compliance with legal and regulatory requirements, (3) the independent auditor’s qualifications and independence, (4) the responsibilities, performance, budget and staffing of the Company’s internal audit function, and (5) the performance of the Company’s independent auditor, which reports directly to the Audit Committee. The Audit Committee is comprised of three directors, all of whom meet the standards of independence adopted by the SEC and the NYSE.

      In performing our oversight responsibilities, we have reviewed and discussed the audited financial statements of the Company for the year ended December 31, 2005 with management and with representatives of the independent registered public accounting firm of Ernst & Young LLP, the Company’s independent auditors. We also reviewed, and discussed with management and representatives of Ernst & Young, management’s assessment and report and Ernst & Young’s report and attestation on the effectiveness of internal control over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act of 2002.

      We also discussed with the independent auditors matters required to be discussed by Statement on Auditing Standards No. 61, Communications with Audit Committees, as amended by Statement on Auditing Standards No. 90. We have received from the Company’s independent auditors the written disclosures and the letter required by Independence Standards Board No. 1, Independence Discussions with Audit Committees, and discussed the independence of Ernst & Young LLP with representatives of such firm. We are satisfied that the non-audit services provided to the Company by the independent auditors are compatible with maintaining their independence.

      Management is responsible for Polaris’ system of internal controls and the financial reporting process. Ernst & Young LLP is responsible for performing an audit of the consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States) and issuing a report thereon. Our committee’s responsibility is to monitor and oversee these processes.

      In reliance on the reviews and discussions referred to in this Report, and subject to the limitations of our role, we recommended to the Board of Directors, and the Board has approved, that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2005.

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

      The Audit Committee of the Board of Directors has engaged the independent registered public accounting firm of Ernst & Young LLP (“E&Y”) as independent auditors to examine the Company’s accounts for the fiscal year ending December 31, 2005. Representatives of E&Y will be present at the Annual Meeting, will have an opportunity to make a statement if they so desire, and will be available to respond to appropriate questions.

      Audit Fees. The aggregate audit fees paid to E&Y for the fiscal years ended December 31, 2005 and December 31, 2004, were $717,000 and $552,000, respectively. These fees include amounts for the audit of the Company’s consolidated annual financial statements, statutory audits at certain foreign subsidiaries, the reviews of the consolidated financial statements included in the Company’s Quarterly Reports on Form 10-Q, including services related thereto such as attest services and consents. These amounts also include fees related to testing of the Company’s internal controls over financial reporting pursuant to Section 404(a) of the Sarbanes-Oxley Act of 2002.

      Audit-Related Fees. The aggregate audit-related fees paid to E&Y for the fiscal years 2005 and 2004 were $117,000 and $96,000, respectively. These fees related to the audit of Polaris Acceptance, the audit of employee benefit plans, assistance related to potential transactions and the issuance of certain industry reports.

      Tax Fees. The aggregate fees billed by E&Y for tax services rendered for the fiscal years 2005 and 2004 were $51,000 and $45,000, respectively. These fees primarily related to tax planning and compliance services, including assistance related to certain foreign subsidiaries.

      All Other Fees. There were no other fees paid to E&Y for the years ended December 31, 2005 and December 31, 2004.

      Audit Committee Pre-Approval Requirements. The Audit Committee’s charter provides that it has the sole authority to review in advance and grant any pre-approvals of (i) all auditing services to be provided by the independent auditor, (ii) all significant non-audit services to be provided by the independent auditors as permitted by Section 10A of the Securities Exchange Act of 1934, and (iii) all fees and the terms of engagement with respect to such services. All audit and non-audit services performed by Ernst & Young during fiscal 2005 were pre-approved pursuant to the procedures outlined above.

PROPOSAL 1 — ELECTION OF DIRECTORS

General Information

      The Board of Directors of the Company is divided into three classes. The members of one class are elected at each annual meeting of shareholders to serve three-year terms. The Class III directors currently serving on the Board, whose terms expire at the 2006 Annual Meeting, are Ms. Annette K. Clayton and Messrs. Gregory R. Palen and Richard A. Zona. In addition, the Board of Directors appointed Stefan Pierer as a Class II director, effective October 20, 2005, to fill the vacancy created by an increase in the number of directors from nine to ten. Mr. Pierer has consented to serve a two-year term, which will expire at the 2008 Annual Meeting when the term of all Class II directors will expire. Also, Mr. William E. Fruhan, Jr., currently a Class II director, has informed the Company of his intention to conclude his service on the Board upon the election of directors and adjournment of the 2006 Annual Meeting on April 20, 2006. Mr. Fruhan has served as a director of the Company since 2000. The Board of Directors will reduce the size of the Board to nine members to eliminate the Class II directorship being vacated by Mr. Fruhan.

      Upon the recommendation of the Corporate Governance and Nominating Committee of the Board, the Board of Directors proposes that the following nominee, who is currently serving as a Class II Director, be elected as a Class II director for a two-year term expiring in 2008:

Stefan Pierer

      Upon the recommendation of the Corporate Governance and Nominating Committee of the Board, the Board of Directors also proposes that the following nominees, all of whom are currently serving as Class III Directors, be elected as Class III directors for three-year terms expiring in 2009:

Gregory R. Palen

Richard A. Zona

Annette K. Clayton

      The persons named in the enclosed proxy intend to vote your proxy for the election of each of the four nominees, unless you indicate on the proxy card that your vote should be withheld from any or all of the nominees. If you are voting by telephone or on the Internet, you will be told how to withhold your vote from some or all of the nominees. Each nominee elected as a Director will continue in office until his or her successor has been elected, or until his or her death, resignation or retirement.

      After the election of one Class II director and three Class III directors at the Annual Meeting and the resignation of Mr. Fruhan effective upon the election of directors and adjournment of the Annual Meeting, the Board will consist of nine directors, including five directors whose present terms extend beyond this Annual Meeting (Classes I, II and III will consist of three members each). There are no family relationships between or among any executive officers or directors of the Company.

      We expect each nominee standing for election as a Class II director and Class III director to be able to serve if elected. If any nominee is not able to serve, proxies will be voted in favor of the remainder of those nominated and may be voted for substitute nominees designated by the Board, unless an instruction to the contrary is indicated on the proxy card.

      The Board of Directors unanimously recommends a vote FOR the election of these nominees as Directors.

Information Concerning Nominees and Directors

      The principal occupation and certain other information about the nominees and other directors whose terms of office continue after the Annual Meeting are set forth on the following pages.

Director Nominee — Class II (Term Ending 2008)

PROPOSAL 2 — APPROVAL OF AMENDMENTS TO THE EMPLOYEE

STOCK PURCHASE PLAN

General Information

      Upon the recommendation of the Compensation Committee, the Board of Directors has adopted, subject to shareholder approval, amendments to the Company’s Amended and Restated Employee Stock Purchase Plan (the “Employee Stock Purchase Plan”), which was originally approved by the Company’s shareholders on May 10, 1995, to (i) extend the term of the Employee Stock Purchase Plan, which currently expires on January 1, 2007, to January 1, 2017 and (ii) amend the option price under the Employee Stock Purchase Plan, which is currently 85% of the average of the fair market values of the Company’s common stock on the date such option is granted and the date such option is exercised, to an amount not less than 85% of the average of the fair market values of the Company’s common stock on the date such option is granted and the date such option is exercised, as determined from time to time by the Committee in accordance with the applicable rules and regulations. The Company’s Board of Directors has determined that it would be in the best interests of the Company and its shareholders to effect these amendments to the Employee Stock Purchase Plan. Accordingly, the Board of Directors recommends that the shareholders approve the proposed amendments. If the amendments to the Employee Stock Purchase Plan are approved by the shareholders, these amendments will take effect as of January 19, 2006. If the amendments are not approved, they will not take effect.

      The reserve of shares of common stock under the Employee Stock Purchase Plan is subject to appropriate adjustment in the event of certain changes in the common stock, including by reason of a stock split. A maximum of 1,500,000 shares of common stock were originally reserved for issuance upon the exercise of options (“Purchase Options”) to purchase shares under the Employee Stock Purchase Plan. Of that total 1,056,952 shares of common stock remained available for future grants as of February 14, 2006. The Board of Directors believes that the Employee Stock Purchase Plan is a vital factor in retaining and attracting personnel of outstanding competence by rewarding them for their achievements. The Employee Stock Purchase Plan also is intended to encourage a sense of proprietary interest by such personnel by providing them with a means to acquire a shareholder interest in the Company.

      The following summary of the Employee Stock Purchase Plan is qualified in its entirety by reference to the complete text of the Employee Stock Purchase Plan, which is attached as Annex B.

General Provisions

      Duration of the Employee Stock Purchase Plan; Shares to be Issued. The Employee Stock Purchase Plan originally became effective on January 1, 1997. If the proposed amendment is approved, the Employee Stock Purchase Plan will remain effective until January 1, 2017 unless terminated earlier by the Board of Directors.

      The shares of common stock to be issued or delivered under the Employee Stock Purchase Plan will be authorized and unissued shares or previously issued and outstanding shares of common stock reacquired by the Company.

      On February 14, 2006, the closing price of Polaris common stock on the New York Stock Exchange was $51.19 per share.

      Administration. The Employee Stock Purchase Plan is currently administered by the Compensation Committee. None of the members of the Compensation Committee are eligible to purchase common stock under the Employee Stock Purchase Plan. The Compensation Committee has authority to establish such rules and procedures as are necessary or advisable to administer the Employee Stock Purchase Plan. The interpretation and construction by the Compensation Committee of the Employee Stock Purchase Plan is final.

      Participants. Each employee of the Company or any subsidiary company approved by the Board of Directors who is customarily employed on a full-time or part-time basis and who is regularly scheduled to

work more than 20 hours per week is eligible to participate in the Employee Stock Purchase Plan. Each eligible salaried employee is eligible to participate in the Employee Stock Purchase Plan for calendar months which commence on or after such employee’s date of hire. Each eligible hourly paid employee is eligible to participate in the Employee Stock Purchase Plan for calendar months which commence on or after 90 calendar days of service. Each part-time employee is eligible to participate in the Employee Stock Purchase Plan for calendar months which commence on or after the earlier of (i) the date on which such hourly paid employee completes 480 hours of service or (ii) the second anniversary of such hourly employee’s date of hire. An employee may not receive a Purchase Option under the Employee Stock Purchase Plan if, immediately after the Purchase Option is granted, the employee would own stock and/or outstanding options to purchase stock possessing 5% or more of the total combined voting power or value of all classes of stock of the Company. Approximately 3,650 employees were eligible to participate in the Employee Stock Purchase Plan as of February 14, 2006.

      In addition, no employee is granted a Purchase Option under the Employee Stock Purchase Plan or an option under any other employee stock purchase plan that qualifies for favorable tax treatment under Section 423 of the Internal Revenue Code of 1986, as amended maintained by the Company to the extent that the employee’s right to purchase shares of common stock under all such options would accrue at a rate at which the fair market value of the shares (determined at the time the Purchase Option is granted) would exceed $25,000 for each calendar year in which any of the options granted to such employee is outstanding at any time. Also, unless the Compensation Committee otherwise determines, executive officers of the Company are not eligible to participate in the Employee Stock Purchase Plan.

      The common stock purchased under the Employee Stock Purchase Plan is paid for by payroll deductions. If an employee elects to participate in the Employee Stock Purchase Plan, he or she must specify a percentage of base pay (up to a maximum of 10%) which the participating employee wants contributed to the Employee Stock Purchase Plan on his or her behalf. These payroll deductions are credited to a bookkeeping account established in the participating employee’s name. A participating employee may change his or her payroll contributions as of the first day of any calendar quarter.

      Awards Available Under the Employee Stock Purchase Plan. On the first day of each month, a participating employee is deemed to have been granted a Purchase Option for the maximum number of whole shares of common stock that can be purchased at the applicable option price with the payroll deductions credited to his or her account for that month. Each participating employee automatically and without any act on his or her part is deemed to have exercised each of his or her Purchase Options on the last day of each month. The number of shares of common stock subject to each Purchase Option equals the quotient of the balance credited to the participating employee’s account as of the last day of the month divided by the option price, except that fractional shares are not issued. Any amount in a participating employee’s account that would otherwise have been used to purchase fractional shares will remain in the employee’s account and be used to purchase shares in subsequent months. The applicable option price is currently an amount equal to 85% of the averages of the closing prices per share of common stock on the New York Stock Exchange as of the first day and the last day of the month. If the proposed amendment is approved, the applicable option price will be an amount not less than 85% of the average of the closing prices per share of the Company’s common stock on the date such option is granted and the date such option is exercised, as determined from time to time by the Compensation Committee in accordance with the applicable rules and regulations. Any balance remaining in a participating employee’s account at the end of a calendar year after payment of the option price for shares purchased pursuant to the Employee Stock Purchase Plan during that year is promptly refunded to the participating employee.

      Shares of common stock purchased by a participating employee under the Employee Stock Purchase Plan is held in trust by a trustee until withdrawn by the participating employee. A participating employee may withdraw in whole, but not in part, from the Employee Stock Purchase Plan at any time. Upon such a withdrawal, all cash and shares of common stock credited to the participating employee’s account is promptly delivered to the participating employee. A participating employee who withdraws from the Employee Stock Purchase Plan is not eligible to participate in the Employee Stock Purchase Plan until the first January 1 or July 1 that is at least six months following the date of such withdrawal.

      If any participating employee’s employment with the Company terminates for any reason, any unexercised Purchase Option granted to such participating employee will terminate as of the date of the termination of employment. The Employee Stock Purchase Plan currently provides that the Company will promptly refund to the participating employee the amount of payroll deductions then credited to the participating employee’s account, and will deliver to the participating employee one or more stock certificates representing the number of shares of common stock credited to the participating employee under the Employee Stock Purchase Plan.

      Purchase Options granted under the Employee Stock Purchase Plan are not transferable otherwise than by will or the laws of descent and distribution, and are exercisable during the participating employee’s lifetime only by the participating employee.

      Termination and Amendment. The Board of Directors has the authority to terminate or amend the Employee Stock Purchase Plan at any time. However, amendments must be approved by the Company’s shareholders if shareholder approval is required under the terms of the Employee Stock Purchase Plan or in order for the Employee Stock Purchase Plan to meet applicable statutory or regulatory requirements.

      Antidilution Provisions. The amount of shares authorized to be issued under the Employee Stock Purchase Plan, and the terms of outstanding Purchase Options, may be adjusted to prevent dilution or enlargement of rights in the event of any merger, consolidation, reorganization, recapitalization, stock split, spin-off, split up or other change in the corporate structure or distributions to the shareholders. No adjustments are made for stock dividends.

      Certain Federal Income Tax Consequences. The following is a brief summary of the principal federal income tax consequences of the Employee Stock Purchase Plan based upon current federal income tax laws. The summary is not intended to be exhaustive and, among other things, does not describe state, local or foreign tax consequences.

      The Employee Stock Purchase Plan is intended to be an “employee stock purchase plan” under Section 423 of the Internal Revenue Code of 1986, as amended. A participating employee must pay Federal income and Federal Insurance Contributions Act (FICA) taxes on amounts that are deducted from his or her pay to purchase common stock under the Employee Stock Purchase Plan. However, a participating employee is not subject to tax upon the receipt of a Purchase Option under the Employee Stock Purchase Plan or upon the purchase of shares of common stock pursuant to the Purchase Option.

      If the participating employee disposes of the shares acquired pursuant to a Purchase Option more than two years following the date of grant of the Purchase Option and more than one year following the date of exercise of the Purchase Option, then the amount realized upon the disposition of the shares is taxed as long-term capital gain; provided, however, that upon such disposition (or in the event of the participating employee’s death while owning the shares) the participating employee recognizes as ordinary income (rather than capital gain) an amount equal to the lesser of: (i) the difference between the fair market value of the shares as of the date of grant of the Purchase Option and the option price paid for the shares, or (ii) the difference between the fair market value of such shares on the date as of which the shares were sold and the option price paid for the shares. The difference between the amount realized upon the disposition of the shares and the amount recognized as ordinary income, if any, will be taxed as long-term capital gain.

      If the participating employee disposes of the shares before the one-year and two-year holding requirements are met, in the year of disposition he recognizes ordinary income equal to the difference between (i) the fair market value of the shares as of the date of exercise or the amount realized upon disposition of the shares, whichever is less, and (ii) the option price paid for the shares. Any additional amount realized upon disposition of the shares is taxed as either short-term or long-term capital gain, depending upon how long the shares were held.

      The Company is entitled to a Federal income tax deduction with respect to the Employee Stock Purchase Plan only if and when a participating employee disposes of common stock before the one- and two-year holding periods are met. The amount of this deduction equals the amount of ordinary income that the participating employee recognizes in connection with such disposition.

Vote Required

      Approval of the amendments to the Employee Stock Purchase Plan will require the affirmative vote of the holders of a majority of the shares of Polaris common stock present in person or by proxy and entitled to vote at the Annual Meeting, assuming the presence of a quorum at the Annual Meeting (provided that the number of shares voted in favor of the proposal constitutes more than 25% of the outstanding shares of the Company’s common stock).

Board Recommendation

      Except where authority has been withheld by a shareholder, the enclosed proxy will be voted for the approval of the Employee Stock Purchase Plan, as amended. The Board of Directors unanimously recommends a vote “FOR” the proposal to approve the amendments to the Employee Stock Purchase Plan.

New Plan Benefits Table

      Assuming shareholders approve the amendments to the Employee Stock Purchase Plan at the Annual Meeting, the following table illustrates the amounts that were awarded under such plan for fiscal year 2005.

NEW PLAN BENEFITS

EQUITY COMPENSATION PLANS

Equity Compensation Plans Approved by Shareholders

      Our shareholders have approved the Polaris Industries Inc. 1995 Stock Option Plan, the Polaris Industries Inc. Restricted Stock Plan, the Polaris Industries Inc. Employee Stock Purchase Plan, the Polaris Industries Inc. Deferred Compensation Plan for Directors and the 2003 Non-Employee Director Stock Option Plan.

Equity Compensation Plans Not Approved by Shareholders

      The Polaris Industries Inc. 1999 Broad-Based Stock Option Plan was approved by the Board of Directors, but was not approved by the shareholders. Neither the NYSE rules nor federal law required shareholder approval at the time the 1999 Broad-Based Stock Option Plan was adopted and accordingly it was not submitted for shareholder approval.

      Under the Polaris Industries Inc. 1999 Broad-Based Stock Option Plan, each of the Company’s full-time employees, and any part-time employee who had performed at least 1,000 hours of service prior to the date of grant, received a one-time award of non-qualified stock options to purchase shares of Polaris common stock.

The Company’s executive officers and directors are not eligible to participate in this plan. On April 1, 1999, an aggregate of 675,400 options were granted under the plan, consisting of an option to each full-time employee to purchase 200 shares and an option to each part-time employee to purchase 100 shares of Polaris common stock. These grants were made at the fair market value of Polaris common stock as of the grant date. Of the 675,400 options initially granted under the plan, an aggregate of 518,400 options vested on March 7, 2002 when the closing price of Polaris common stock, as reported on the NYSE, was two times the per share exercise price of such options. The Board of Directors does not intend to grant any future options under this plan.

Summary Table

      The following table sets forth certain information as of December 31, 2005, with respect to compensation plans under which shares of Polaris common stock may be issued.

EXECUTIVE COMPENSATION AND STOCK OPTION INFORMATION

Executive Compensation Summary

      The following table shows, for each of the last three fiscal years, the annual compensation paid to or earned by the Company’s Chief Executive Officer, the other four most highly compensated executive officers who served as executive officers as of December 31, 2005, and one additional individual who would have been among the four other most highly compensated executive officers had he continued to serve as an executive officer on December 31, 2005 (collectively, the “Executive Officers”).

Summary Compensation Table

      The Company does not maintain any defined benefit or actuarial pension plan under which benefits are determined primarily by final compensation and years of service.

Option Grants in 2005

      The following table shows all options to purchase Polaris common stock granted in 2005 to each of our Executive Officers named in the Summary Compensation Table and the potential value of such grants at stock price appreciation rates of 5% and 10%, compounded annually over the maximum ten-year term of the options, except for the option granted to Mr. Tiller, which was compounded annually over the maximum 47-month term of such option. The 5% and 10% rates of appreciation are required to be disclosed by SEC rules and are not intended to forecast possible future appreciation, if any, in our stock price. The actual future value of the options will depend on the market value of the Company’s common stock.

OPTION GRANTS DURING 2005 AND

ASSUMED POTENTIAL REALIZABLE VALUES

Option Exercises and Values for 2005

      The following table gives information for options exercised by each of the Executive Officers in 2005 and the value (stock price less exercise price) of the remaining options held by those Executive Officers at year-end measured in terms of the closing price of Polaris common stock on December 30, 2005, the last trading day of the year.

AGGREGATED OPTION EXERCISES DURING 2005 AND

OPTION VALUES ON DECEMBER 30, 2005

Employment, Termination and Change in Control Agreements

      Mr. Tiller and Polaris entered into an employment agreement effective January 1, 2006, which replaced all prior agreements, except for his Change of Control Agreement dated April 1, 1998, which remains in effect. Mr. Tiller will continue to be employed as Chief Executive Officer of the Company through at least December 31, 2007. Mr. Tiller’s agreement provides for:

      If Mr. Tiller’s employment terminates as a result of his death or disability, he or his designated beneficiaries, as appropriate, will receive payments equal to (i) his base salary earned through the date of termination payable when such salary would customarily be paid; (ii) a pro rata bonus payment for the year of termination based on the average of the annual bonuses paid or payable to him for the two calendar years preceding the year in which the termination occurs payable when bonuses for such period are customarily paid; and (iii) any annual bonus for a preceding year that remains unpaid at the time of termination payable when such bonuses are paid to other executives of the Company. In addition, all of his outstanding stock options and restricted share awards will vest immediately.

      If Mr. Tiller’s employment is terminated by the Company for cause or by him without good reason, he will receive (i) his base salary earned through the date of termination payable when such salary would customarily be paid; and (ii) any annual bonus for a preceding year that remains unpaid at the time of termination payable when such bonuses are paid to other executives of the Company. Upon termination under these circumstances, all stock options and unvested restricted share awards will terminate immediately and he may purchase health insurance under the Company’s then existing health insurance plan in accordance with applicable government requirements.

      If Mr. Tiller’s employment is terminated by the Company without cause or by him for good reason, he will receive payments equal to (i) his base salary earned through the date of termination payable when such salary would customarily be paid; (ii) a pro rata bonus payment for the year of termination based on the average of the annual bonuses paid or payable to him for the two calendar years preceding the year in which the termination occurs payable when bonuses for such period are customarily paid; (iii) his base salary as then in effect for a two-year period, payable in monthly installments at the times such base salary would customarily be paid; (iv) a pro rata bonus payment in each of the two years following termination based on the average of the annual bonuses paid or payable to him for the two calendar years preceding the year in which the termination occurs payable when the annual bonuses for such years are paid; and (v) any annual bonus for a preceding year that remains unpaid at the time of termination payable when such bonuses are paid to other executives of the Company. In addition, the Company will provide him with medical and dental insurance coverage for a period ending on the earlier of the second anniversary of the date of termination or the date on which another employer employs him. Any stock options and restricted share awards that would, by their terms, vest on or before the first anniversary of the date of termination will vest immediately, and in the case of stock options, be exercisable until the first anniversary of the date of termination.

      Under his employment agreement, Mr. Tiller has agreed not to engage in competitive activities for a period of two years following his termination of employment.

      Mr. Morgan and Polaris entered into an employment agreement effective April 11, 2005 in connection with his promotion to President and Chief Operating Officer of the Company, which replaced all prior agreements, except for his Change of Control Agreement dated November 1, 2004. Mr. Morgan’s agreement provides for:

      On April 12, 2005, the Company announced that Kenneth J. Sobaski would depart from his position as the Company’s Vice President — Sales, Marketing and Service to pursue other interests. In connection with Mr. Sobaski’s resignation, Polaris entered into a Severance Agreement, Waiver and Release dated as of April 26, 2005. Under the terms of Mr. Sobaski’s agreement, a copy of which was filed as Exhibit 10.z to the Company’s Current Report on Form 8-K filed on May 2, 2005, Mr. Sobaski will receive base salary continuation payments through April 25, 2006, a profit sharing payment of not less than $292,000 attributable to the full year 2005, matching contributions in the Company’s Supplemental Employee Retirement Plan, and reimbursement for premiums for COBRA benefits, certain other medical expenses not covered by COBRA but that would be reimbursable through the Company’s existing Exec-U-Care benefit, and for premiums on term life insurance with policy limits of up to $650,000.

      The Company has entered into change in control agreements (the “Agreements”) with the Executive Officers named in the Summary Compensation Table which become effective only upon a Change in Control (as defined in the Agreements). If upon or within 24 months after a Change in Control, any of the Executive Officers terminates his employment for Good Reason or such employee’s employment is terminated without Cause (as such terms are defined in the Agreements), he will be entitled to all accrued but unpaid compensation and benefits and a lump-sum cash payment equal to two times his average annual cash compensation (including cash bonuses, but excluding the award or exercise of stock options or stock grants) for the three fiscal years (or lesser number of years if such employee’s employment has been of shorter duration) of the Company immediately preceding such termination. If such termination occurs before a cash bonus for any preceding fiscal year has been paid, the Company is required to pay to the employee the amount of the employee’s cash bonus for such preceding fiscal year as soon as it is determinable and such amount is to be included in the determination of the payment to be made pursuant to the Agreement. No cash bonus shall be paid for any part of the fiscal year in which the termination occurs.

COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

      The Compensation Committee operates under a written charter adopted by the Company’s Board of Directors. The Compensation Committee assists the Board in, among other things, establishing a philosophy and policies regarding executive compensation, providing oversight to the administration of the Company’s executive compensation programs and reviewing the compensation of executive officers and senior management. The Committee is comprised entirely of independent directors and is advised by an independent compensation consultant retained by the Compensation Committee.

Executive Compensation Philosophy

      Polaris’ executive total compensation program is designed to attract and retain highly qualified executives and to motivate them to maximize shareholder returns by achieving aggressive goals. The program is designed to:

Compensation Components

      Polaris utilizes two primary components in designing a compensation system appropriate to the needs of the Company and its shareholders:

Factors Considered in Determining Compensation

      The Compensation Committee intends that, in order to attract and retain talented individuals, the compensation of Polaris executives be competitive with other companies in its comparable market. On an annual basis the Committee reviews competitive executive compensation levels based upon a report compiled by the Compensation Committee’s independent compensation consultant that includes comparative compensation data from a survey of a group of companies determined by the consultant and the Committee to be relevant for executive compensation comparison purposes. In January 2006, the survey group included 70 companies, primarily in the manufacturing industry, with sales ranging from $1 billion to $4 billion. The independent compensation consultant’s report addresses all aspects and components of compensation of the executives and compares and contrasts Polaris’ executive compensation with the compensation of similarly situated executives at the companies within the survey group. In its annual review, the Committee and its independent compensation consultant take into consideration differences in the size and success of the companies surveyed and any material differences in performance, responsibilities and authority between and among Polaris executives and executives at the various companies within the survey group for purposes of determining executive compensation. Utilizing the information provided by its independent compensation consultant, the Committee conducts its own review of various parts of the compensation program and an assessment, with the assistance of the Chief Executive Officer of the Company, of the skills, experience and achievements of individual executives to determine the compensation targets of Company officers as a group and individually. The Committee approves any changes to the compensation of Company officers including base salary, annual incentive payments, stock options, restricted stock and long-term cash incentive awards.

      An objective of Polaris’ executive compensation program is to approximate over time the survey group’s median compensation, adjusted for company size and performance, and to pay higher than the median compensation if Polaris outperforms comparable companies and an executive contributes meaningfully to that performance. In 2005, Polaris’ executive salaries, annual incentive and long term incentive awards were consistent with this goal.

      The Committee also considers the tax deductibility to Polaris of compensation paid to its executives. Section 162(m) of the Internal Revenue Code generally provides that a publicly held corporation will not be entitled to deduct for federal income tax purposes compensation paid to either its chief executive officer or any of its four other most highly compensated executive officers in excess of $1 million in any year if that compensation is not performance related. In April 2004, shareholders approved Polaris’ Senior Executive Annual Incentive Compensation Plan and its Long Term Incentive Plan. Senior executives of the Company, to whom Section 162(m) may apply, participate in the Senior Executive Annual Incentive Compensation Plan in lieu of the company-wide profit sharing plan. Awards under both plans approved by shareholders in 2004 would meet the requirements of Section 162(m) and be tax deductible to the Company. Additionally, outstanding grants under the Company’s stock based compensation programs, including stock option and restricted stock programs, are performance-based for purposes of Section 162(m). The Compensation Committee believes that all compensation paid to Polaris’ executives for 2005 is properly deductible under the Internal Revenue Code.

Compensation of the Chief Executive Officer

      The executive compensation philosophy and factors in determining compensation described above apply to the compensation of the Chief Executive Officer, except that the Chief Executive Officer is not eligible for the long term cash-based incentive plan that was established in 2004.

      On February 20, 2006, the Company and Mr. Tiller entered into an employment agreement that extends the term of Mr. Tiller’s employment through December 31, 2007, but leaves unchanged from the prior employment agreement that became effective January 1, 2005 and would have expired in accordance with its terms on December 31, 2006, the terms and conditions of Mr. Tiller’s employment. In connection with the execution of Mr. Tiller’s prior employment agreement, in January 2005 Mr. Tiller was granted stock options with respect to 215,000 shares with an exercise price of $67.50 and awarded 33,000 performance-based restricted shares. Both the stock option grant and the restricted share award are considered performance-based for purposes of Section 162(m) of the Internal Revenue Code. The stock options were granted in accordance with the Company’s 1995 Stock Option Plan and vest on December 31, 2006. The performance-based restricted share awards were granted in accordance with the Company’s 1996 Restricted Stock Plan and the restricted shares of common stock granted thereunder become freely tradeable only upon the Company achieving certain compounded earnings growth targets within a two or three year period. Mr. Tiller received no additional options or performance-based restricted share awards in connection with the execution of the new employment agreement in February 2006. Pursuant to the employment agreement, Mr. Tiller’s base salary is $750,000 per year. From November 1, 2002 through December 31, 2004 Mr. Tiller’s base salary was $675,000 and was increased to $750,000 per year effective January 1, 2005. In addition to this base salary, the benefits and perquisites paid or made available to Mr. Tiller during 2005 include club memberships, club dues, financial planning and tax preparation, Exec-U-Care in addition to standard employee medical and dental benefits, and 401(k) Retirement Savings Plan participation augmented by the Supplemental Retirement/ Savings Plan. During 2005, Polaris did not pay any club membership initiation fees or club dues to or for the benefit of Mr. Tiller. The Supplemental Retirement/ Savings Plan to which Mr. Tiller may contribute is designed to mirror the Company-wide 401(k) Retirement Savings Plan, except that qualifying employees of the Company are eligible to make contributions of deferred income to the Supplemental Retirement/ Savings Plan above the IRS annual limits on 401(k) contributions. Contributions are matched by the Company and are limited to the Company match on 401(k) contributions. In 2005, Mr. Tiller and the Company each contributed an aggregate of approximately $105,000 to the Company’s 401(k) Retirement Savings Plan and the Supplemental Retirement/ Savings Plan.

      In accordance with the established Senior Executive Annual Incentive Compensation Plan, Mr. Tiller was awarded $975,000 in February 2006 for his 2005 performance. During 2005, the Company achieved the earnings per share benchmarks established by the Compensation Committee at the beginning of the year for payment to Mr. Tiller of 200% of his base pay under the Senior Executive Annual Incentive Compensation Plan. The Compensation Committee determined to pay Mr. Tiller 65% of the award otherwise available based upon the Company’s actual performance after consideration of the Company’s planned as well as actual earnings, strong balance sheet, superior productivity, consistent earnings growth and Mr. Tiller’s strong leadership as well as Mr. Tiller’s own view that his potential award should be reduced. The award is consistent with the executive compensation philosophy to approximate the median compensation of the Chief Executive Officer in the comparative companies, adjusted for comparative company size and performance and to pay above the median when the Company performance warrants it as well as the common view of the Compensation Committee and the Company’s Chief Executive Officer that executive officers with increasing levels and amounts of responsibility should have higher levels of their compensation based upon Company-wide performance. In 2005, Mr. Tiller led Polaris to 5% sales from continuing operations growth and 8% earnings per share from continuing operations growth.

      The Compensation Committee has reviewed all components of the Chief Executive Officer’s compensation, including annual base salary, bonuses based on corporate and annual performance, equity compensation, accumulated and projected stock option and performance-based restricted share gains under various scenarios, the dollar value to the executive and cost to the Company and all perquisites and other benefits and projected payment obligations under potential severance and change-in-control scenarios. A tally sheet setting forth all

of the above components affixing dollar amounts under various scenarios was prepared by the Compensation Committee’s independent compensation consultant and reviewed by the Compensation Committee.

      Based on this review, the Compensation Committee has determined that the total compensation of the Company’s Chief Executive Officer (and in the case of severance and change-in-control scenarios, the potential payouts) in the aggregate to be reasonable and not excessive.

STOCK PERFORMANCE GRAPH

      The graph below compares the five-year cumulative total return to shareholders (stock price appreciation plus reinvested dividends) for the Company’s common stock with the comparable cumulative return of two indexes: Russell 2000 Index and CoreData Group’s Recreational Vehicles Industry Group Index. The graph assumes the investment of $100 on January 1, 2001 in common stock of the Company and in each of the indexes, and the reinvestment of all dividends. Points on the graph represent the performance as of the last business day of each of the years indicated.

Comparison of 5-Year Cumulative Total Return Among

Polaris Industries Inc., Russell 2000 Index and Recreational Vehicles Index

Assumes $100 Invested on January 1, 2001

Assumes Dividend Reinvested

Fiscal Year Ended December 31, 2005

Source: CoreData Group

OTHER MATTERS

      The Board is not aware of any matters that are expected to come before the 2006 Annual Meeting other than those referred to in this Proxy Statement. If any other matter should come before the Annual Meeting, the persons named in the accompanying proxy intend to vote the proxies in accordance with their best judgment.

SUBMISSION OF SHAREHOLDER PROPOSALS AND NOMINATIONS

      Under the rules of the Securities and Exchange Commission, if a shareholder wants us to include a proposal in our proxy statement and form of proxy for presentation at our 2007 Annual Meeting of Shareholders the proposal must be submitted in writing and received by the Secretary of the Company at our principal executive offices by November 1, 2006. If a shareholder intends to introduce an item of business at the 2007 Annual Meeting, without including the proposal in the proxy statement, the Company must receive notice of that intention no later than January 19, 2007. If we do not receive a notice by January 19, 2007, the persons named as proxies in the proxy materials relating to the 2007 Annual Meeting will use their discretion in voting the proxies when these matters are raised at the meeting.

      If a shareholder wishes to have the Corporate Governance and Nominating Committee consider a candidate for nomination as a director, the notice of nomination must be submitted in writing and received by the Secretary of the Company at our principal executive offices by November 1, 2006. The notice given by a shareholder who proposes a candidate for nomination must include (i) the submitting shareholder’s name and address, (ii) a signed statement as to the submitting shareholder’s current status as a shareholder, the number of shares currently owned and the length of such ownership; (iii) the name of the candidate and a resume or a listing of the candidate’s qualifications to be a director, and (iv) a document evidencing the candidate’s willingness to serve as a director if selected by the Corporate Governance and Nominating Committee and nominated by the Board of Directors.

ADDITIONAL INFORMATION

      A copy of the Annual Report of the Company for the year ended December 31, 2005 is being sent to shareholders with this Proxy Statement. A copy of the Company’s Annual Report on Form 10-K for the year ended December 31, 2005, as filed with the Securities and Exchange Commission, is included as a part of the Annual Report being sent to shareholders with this Proxy Statement.

      Additional copies of the Annual Report, the Notice of Annual Meeting, this Proxy Statement and the accompanying proxy may be obtained from Michael W. Malone, the Vice President-Finance, Chief Financial Officer and Secretary of the Company. Copies of exhibits to Form 10-K may be obtained upon payment to the Company of the reasonable expense incurred in providing such exhibits.

ANNEX A

POLARIS INDUSTRIES INC.

BOARD OF DIRECTORS

AUDIT COMMITTEE CHARTER

Adopted May 18, 2000

Revised January 24, 2002, January 23, 2003, January 22, 2004 and January 19, 2006

      Polaris Industries Inc. (the “Company”) is a publicly held company and operates in a complex, dynamic, highly competitive, and regulated environment. In order to assure the kind of informed decision-making beneficial to the Company and its shareholders, much of the Board’s oversight occurs through the standing committees of the Board, such as the Audit Committee. The primary function of the Audit Committee is to assist the Board of Directors in fulfilling its fiduciary responsibilities by overseeing the Company’s financial reporting and public disclosure activities. The Audit Committee’s primary purposes are to:

      The Audit Committee, in its capacity as a committee of the Board of Directors, shall be directly responsible for the appointment, compensation, and oversight of the work of any independent auditor employed by the Company (including resolution of disagreements between management and the auditor regarding financial reporting) for the purpose of preparing or issuing an audit report or related work or performing other audit, review or attest services for the Company, and each such independent auditor shall report directly to the Audit Committee.

      The Audit Committee will primarily fulfill these responsibilities by carrying out the activities specified in Section IV of this Charter.

      Although the Audit Committee has the responsibilities and powers set forth in this Charter, the role of the Audit Committee is oversight. The members of the Audit Committee are not employees of the Company and may or may not be auditors or accountants by profession and it is not the duty or responsibility of the Audit Committee to plan or conduct audits or to determine that the Company’s financial statements are in accordance with generally accepted accounting principles. These are the responsibilities of Company management and the independent auditor.

      The Audit Committee shall be comprised of three or more Directors as determined by the Board and be elected by the Board on the recommendation of the Corporate Governance and Nominating Committee. The Board may remove any member from the Audit Committee at any time with or without cause. Unless a Chair is elected by the full Board, the members of the Audit Committee may designate a chair by majority vote of the full Audit Committee membership. If an Audit Committee member desires to serve on the Audit Committees of more than three public companies, then in each such case, the Board must determine that such

simultaneous service would not impair the ability of such member to effectively serve on the Company’s Audit Committee, and such determination shall be disclosed in the Company’s annual proxy statement.

      The Audit Committee may, in its discretion, form and delegate authority to a subcommittee of the Audit Committee or to the Chair.

      Each member of the Audit Committee shall have been affirmatively determined by the Board to meet the standards of independence required by the SEC and the New York Stock Exchange, and shall be free from any relationship that, in the opinion of the Board, may interfere with their independence from management and the Company.

      Each member of the Audit Committee shall be financially literate, as such qualification is interpreted by the Company’s Board of Directors in its business judgment, or must become financially literate within a reasonable period of time after his or her appointment to the Audit Committee. At least one member of the Audit Committee shall have been determined by the Board of Directors of the Company to have accounting or financial management expertise, which qualification shall be conclusively presumed if the person is an “Audit Committee Financial Expert” as such term is defined by the SEC.

      The Audit Committee shall meet in person or telephonically at least four times annually, with additional meetings as often as necessary, at times and places determined by the Chair, with further actions to be taken by unanimous written consent, when deemed necessary or desirable by the Audit Committee or its Chair. To the extent practicable, each of the Audit Committee members shall attend each of the regularly scheduled meetings in person. The Audit Committee shall periodically make time available during its regularly scheduled meetings to meet with management, the internal auditors and the independent auditors in separate sessions to discuss any matters that the Audit Committee or any of these groups believe should be discussed privately.

      A majority of the Audit Committee members currently holding office constitutes a quorum for the transaction of business. The Audit Committee shall take action by the affirmative vote of a majority of the Audit Committee members present at a duly held meeting or by unanimous written action.

      The Audit Committee shall undertake the following responsibilities and duties:

          E.     Other

      The Audit Committee has adopted the following practices regarding the hiring by the Company of any partner, director, manager, advising member of the department of professional practice, reviewing actuary, reviewing tax professional and any other persons having similar responsibility for providing audit assurance (including all work that results in the expression of an opinion on financial statements and audits of statutory accounts) to the Company’s independent auditor on any aspect of its certification of the Company’s financial statements:

      The Audit Committee has established the following procedures for: (i) the receipt, retention, and treatment of questions, concerns or complaints received by the Company regarding accounting, internal accounting controls, or auditing matters; and (ii) the confidential, anonymous submission by Company employees of questions, concerns or complaints regarding questionable accounting or auditing matters:

      1. At the time of or in advance of the annual shareholders meeting held each year, present an annual performance evaluation of the Audit Committee, which shall assess the performance of the Audit Committee in fulfilling the requirements of this charter, recommend any amendments to this charter, and set forth the goals and objectives of the Audit Committee for the ensuing twelve months.

      2. Transmit to the Board notices of Audit Committee meetings, agendas, and meeting minutes.

      The Audit Committee shall have such resources and authority as it deems necessary to discharge its duties and responsibilities, including the sole authority to retain, discharge, and approve fees and other terms for retention of the independent auditors, independent legal counsel, and other independent experts or advisors. The Company shall provide appropriate funding, as determined by the Audit Committee, in its capacity as a committee of the Board of Directors of the Company, for the payment of compensation of the independent auditors, independent legal counsel, and other independent experts or advisors so retained by the Audit Committee and ordinary administrative expenses that are necessary and appropriate to carry out its duties. The Audit Committee may direct any officer or employee of the Company or request any employee of the Company’s independent auditor or outside legal counsel to attend an Audit Committee meeting or meet with any Audit Committee members.

ANNEX B

POLARIS INDUSTRIES INC.

EMPLOYEE STOCK PURCHASE PLAN

As Amended and Restated

Effective January 19, 2006

ARTICLE I — PURPOSE

      1.01     Purpose. The Polaris Industries Inc. Employee Stock Purchase Plan (the “Plan”) is intended to provide a method whereby employees of Polaris Industries Inc. and its subsidiary corporations (the “Company”) will have an opportunity to acquire a proprietary interest in the Company through the purchase of shares of the common stock, par value $.01 per share (“Common Stock”) of the Company. It is the intention of the Company to have the Plan qualify as an “employee stock purchase plan” under section 423 of the Internal Revenue Code of 1986, as amended (the “Code”). The provisions of the Plan shall be construed so as to extend and limit participation in a manner consistent with the requirements of that section of the Code.

ARTICLE II — DEFINITIONS

      2.01     Base Pay. “Base Pay” shall mean a participant’s wages, salary and other cash remuneration from the Company. The term “Base Pay” is intended to coincide with the definition of “Covered Compensation” as defined in the 401(k) Retirement/ Savings Plan of Polaris.

      2.02     Committee. “Committee” shall mean the committee described in Article IX.

      2.03     Employee. “Employee” shall mean any person who is customarily employed on a full-time or part-time basis by the Company or a Participating Subsidiary and is regularly scheduled to work more than twenty (20) hours per week.

      2.04     Fair Market Value. “Fair Market Value” shall mean, as of any applicable date: (i) if the Common Stock is listed on a national securities exchange or is authorized for quotation on the National Association of Securities Dealers Inc.’s NASDAQ National Market System (“NASDAQ/ NMS”), the closing price, regular way, of the Common Stock on such exchange or NASDAQ/ NMS, as the case may be, or if no such reported sale of the Common Stock shall have occurred on such date, on the next preceding date on which there was such a reported sale; or (ii) if the Common Stock is not listed for trading on a national securities exchange or authorized for quotation on NASDAQ/ NMS, the closing bid price as reported by the National Association of Securities Dealers Automated Quotation System (“NASDAQ”), or if no such prices shall have been so reported for such date, on the next preceding date for which such prices were so reported; or (iii) if the Common Stock is not listed for trading on a national securities exchange or authorized for quotation on NASDAQ, the last reported bid price published in the “pink sheets” or displayed on the NASD Electronic Bulletin Board, as the case may be; or (iv) if the Common Stock is not listed for trading on a national securities exchange, or is not authorized for quotation on NASDAQ/ NMS or NASDAQ, or is not published in the “pink sheets” or displayed on the NASD Electronic Bulletin Board, the Fair Market Value of the Common Stock as determined in good faith by the Committee.

      2.05     Fund Account. “Fund Account” shall mean the bookkeeping account established for each participant to which the participant’s payroll deductions shall be credited.

      2.06     Investment Account. “Investment Account” shall mean the bookkeeping account established for each participant to which Common Stock purchased by the participant under the Plan shall be credited.

      2.07     Participating Subsidiary. “Participating Subsidiary” shall mean any corporation which (i) is a “subsidiary corporation” of Polaris as that term is defined in section 424 of the Code and (ii) is designated as a participating employer under the Plan by the Board of Directors of the Company.

      2.08     Trustee. “Trustee” shall mean the person(s) or institution designated by the Board of Directors of the Company as trustee of the Plan, and any successors thereto.

ARTICLE III — ELIGIBILITY AND PARTICIPATION

      3.01     Initial Eligibility. Each salaried Employee shall be eligible to participate in the Plan for calendar months which commence on or after such salaried Employee’s date of hire. Each hourly paid Employee shall be eligible to participate in the Plan for calendar months which commence on or after the earlier of (i) the date on which such hourly Employee completes 480 Hours of Service or (ii) the second anniversary of such hourly Employee’s date of hire. For purposes of this Section 3.01, the term “Hours of Service” shall mean “Hours of Service” as that term is defined in the Polaris Industries Inc. Employee Stock Ownership Plan.

      3.02     Restrictions on Participation. Notwithstanding any provisions of the Plan to the contrary, no Employee shall be granted an option under the Plan:

      3.03     Commencement of Participation. An eligible Employee may become a participant by completing an authorization for a payroll deduction on the form provided by the Company and filing it with the office of the Treasurer of the Company. Participation in the Plan and payroll deductions for a participant shall commence on the first day of the month following the date his or her authorization for a payroll deduction is filed. A participant’s payroll deduction authorization shall remain in effect unless amended or terminated by the participant as provided in Section 4.03 or Article VII.

      3.04     Special Participation with Respect to Profit Sharing Distribution. With the approval of the Committee, eligible Employees may be permitted to participate in the Plan on a separate basis with respect to the participant’s distribution from the Polaris Industries Inc. Profit Sharing Plan (in addition to any level of participation pursuant to the eligible Employee’s regular payroll deduction election) by completing an authorization for a deduction from the profit sharing distribution on the form provided by the Company and filing it with the office of the Treasurer of the Company on or before the date set therefor by the Committee. References herein to “payroll” deductions shall be deemed to include any amounts deducted from a participant’s profit sharing distribution.

ARTICLE IV — PAYROLL DEDUCTIONS

      4.01     Amount of Deduction. At the time a participant files his authorization for payroll deduction, he or she shall elect to have deductions made from his or her Base Pay on each payday during the time he or she is a participant computed as a percentage of his Base Pay, not to exceed a maximum of ten percent.

      4.02     Participant’s Fund Account. All payroll deductions made for a participant shall be credited to a Fund Account established in his or her name under the Plan. A participant may not make any separate cash payment into such account. No interest shall be credited or paid on amounts credited to participants’ Fund Accounts under the Plan.

      4.03     Changes in Payroll Deductions. A participant may discontinue his participation in the Plan as provided in Article VII, and may change his or her payroll deduction percentage as of the first day of any calendar quarter.

ARTICLE V — OPTIONS

      5.01     Number of Options. On the first day of each month, a participant shall be deemed to have been granted an option to purchase a maximum number of whole shares of Common Stock as can be purchased at the applicable option price (as described in Section 5.02) with payroll deductions credited to his or her Fund Account during such month.

      5.02     Option Price. The option price of Common Stock purchased with payroll deductions made for a participant shall be an amount not less than 85% of the average of the Fair Market Values of the Common Stock on the date such option is granted (as set forth in Section 5.01) and the date such option is exercised (as set forth in Section 6.01), as determined from time to time by the Committee in accordance with applicable rules and regulations.

      5.03     Option Period. All options which shall be deemed granted under Section 5.01 of this Plan as of the first day of a month shall be automatically exercised in accordance with Section 6.01 unless sooner terminated in accordance with Article VII.

ARTICLE VI — EXERCISE OF OPTIONS

      6.01     Automatic Exercise. Unless a participant sooner withdraws from the Plan as provided in Article VII, his option for the purchase of Common Stock with payroll deductions credited to his or her Fund Account will be deemed to have been exercised automatically on the last day of each calendar month, for the purchase from the Company of the number of whole shares of Common Stock which the accumulated payroll deductions credited to his or her Fund Account at that time will purchase at the applicable option price (but not in excess of the number of shares for which options have been granted to the participant pursuant to Section 5.01). Any excess amount credited to a participant’s Fund Account at the end of the calendar year will be promptly returned to him or her.

      6.02     Fractional Shares. The shares of Common Stock purchased by a participant upon the deemed exercise of his option as specified above shall not include fractional shares. Amounts credited to a participant’s Fund Account which would have been used to purchase fractional shares shall remain credited to such Fund Account until subsequently used to purchase shares or paid to the participant or his or her beneficiary in accordance with Section 6.01 or Article VII.

      6.03     Investment Accounts. All shares of Common Stock purchased under the Plan shall be maintained by the Trustee in separate Investment Accounts for participants. All cash dividends paid with respect to the shares so purchased shall be reinvested in Common Stock and added to the shares held for a participant in his or her Investment Account.

ARTICLE VII — WITHDRAWAL

      7.01     In General. A participant may withdraw payroll deductions credited to his or her Fund Account and the shares of Common Stock credited to his or her Investment Account under the Plan at any time by giving written notice of withdrawal to the Treasurer of the Company. All of the cash credited to his or her Fund Account and not used to buy Common Stock shall be paid to the participant and one or more stock certificates representing the shares of Common Stock credited to his or her Investment Account shall be delivered to the participant promptly after receipt of his or her notice of withdrawal, and no further payroll deductions will be made from his or her pay except as provided in Section 7.02. Upon such a withdrawal, all unexercised options of the participant shall immediately terminate.

      7.02     Effect on Subsequent Participation. If a participant withdraws from participation in the Plan as provided in Section 7.01, such participant shall not be eligible to participate in the Plan for a period of time following the date of such withdrawal. If the withdrawal occurs during the period from January 1 to June 30 of a year, participation may begin again no earlier than January 1 of the next year. If the withdrawal occurs during the period from July 1 to December 31 of a year, participation may begin again no earlier than July 1 of the next year.

      7.03     Termination of Employment. Upon termination of the participant’s employment for any reason, including retirement, his or her unexercised options shall immediately terminate and the payroll deductions credited to his or her Fund Account and not used to buy Common Stock will be paid to him or her, and one or more stock certificates representing the shares of Common Stock credited to his or her Investment Account will be delivered to the participant, or, in the case of his or her death subsequent to the termination of his employment, to the person or persons entitled thereto under Section 10.01.

ARTICLE VIII — COMMON STOCK

      8.01     Maximum Number of Shares. The maximum number of shares of Common Stock which the Company shall have authority to issue under this Plan, subject to adjustment upon changes in capitalization of the Company as provided in Section 10.04, shall be 1,500,000 shares. Such shares may be authorized but unissued shares or reacquired shares of Common Stock, as the Company shall determine. If the total number of shares for which options are exercised on any exercise date exceeds the maximum number of shares available, the Company shall make a pro rata allocation of the shares available for delivery and distribution in as nearly a uniform manner as shall be practicable and as it shall determine to be equitable, and the balance of payroll deductions credited to the Fund Account of each participant under the Plan shall be returned to him or her as promptly as possible.

      8.02     Participant’s Interest in Option Stock. The participant will have no interest in Common Stock covered by his or her option until such option has been exercised.

      8.03     Registration of Stock. Shares of Common Stock purchased under the Plan will be held by the Trustee for the benefit of participants, until withdrawn by the participant in accordance with Article VII. Upon such withdrawal, the shares shall be registered in the name of the participant, or, if the participant so directs by written notice to the Treasurer of the Company, in the names of the participant and one such other person as may be designated by the participant, as joint tenants with rights of survivorship or as tenants by the entireties, to the extent permitted by applicable law.

      8.04     Restrictions on Exercise. The Board of Directors of the Company may, in its discretion, require as conditions to the exercise of any option that the shares of Common Stock reserved for issuance upon the exercise of the option shall have been duly listed, upon official notice of issuance, on a stock exchange, and that either:

ARTICLE IX — ADMINISTRATION

      9.01     Appointment of Committee. The Board of Directors of the Company shall appoint a Committee to administer the Plan. No member of the Committee shall be eligible to purchase Common Stock under the Plan.

      9.02     Authority of Committee. Subject to the express provisions of the Plan, the Committee shall have plenary authority in its sole and absolute discretion to interpret and construe any and all provisions of the Plan,

to adopt rules and regulations for administering the Plan, and to make all other determinations deemed necessary or advisable for administering the Plan. The Committee’s determination on the foregoing matters shall be conclusive.

      9.03     Rules Governing the Administration of the Committee. The Board of Directors of the Company may from time to time appoint members of the Committee in substitution for or in addition to members previously appointed and may fill vacancies, however caused, in the Committee. The Committee may select one of its members as its Chairman and shall hold its meetings at such times and places as it shall deem advisable and may hold telephonic meetings. A majority of the members of the Committee shall constitute the vote of a quorum. All determinations of the Committee shall be made by a majority of its members present. The Committee may correct any defect or omission or reconcile any inconsistency in the Plan, in the manner and to the extent it shall deem desirable. Any decision or determination reduced to writing and signed by a majority of the members of the Committee shall be as fully effective as if it had been made by a majority vote at a meeting duly called and held. The Committee may appoint a secretary and shall make such rules and regulations for the conduct of its business as it shall deem advisable.

ARTICLE X — MISCELLANEOUS

      10.01     Designation of Beneficiary. A participant may file a written designation of a beneficiary who is to receive any cash and shares of Common Stock credited to the participant’s Investment and Fund Accounts upon the participant’s death. Such designation of beneficiary may be changed by the participant at any time by written notice to the Treasurer of the Company. Upon the death of a participant and upon receipt by the Company of proof of identity and existence at the participant’s death of a beneficiary validly designated by him under the Plan, the Company shall deliver such cash and shares of Common Stock to such beneficiary. In the event of the death of a participant and in the absence of a beneficiary validly designated under the Plan who is living at the time of such participant’s death, the Company shall deliver such cash and shares of Common Stock to the executor or administrator of the estate of the participant, or if no such executor or administrator has been appointed (to the knowledge of the Company), the Company, in its discretion, may deliver such cash and shares of Common Stock to the spouse or to any one or more dependents of the participant as the Company may designate. No beneficiary shall, prior to the death of the participant by whom he has been designated, acquire any interest in the cash and shares of Common Stock credited to the participant under the Plan.

      10.02     Transferability. During a participant’s lifetime, his or her options can only be exercised by him or her. Neither the amounts credited to a participant’s Fund Account nor any rights with regard to the exercise of an option or to receive stock under the Plan may be assigned, transferred, pledged, or otherwise disposed of in any way by the participant other than by will or the laws of descent and distribution. Any such attempted assignment, transfer, pledge or other disposition shall be without effect, except that the Company may treat such act as an election to withdraw funds in accordance with Section 7.01.

      10.03     Use of Funds. All payroll deductions received or held by the Company under this Plan may be used by the Company for any corporate purpose and the Company shall not be obligated to segregate such amounts.

      10.04     Adjustment Upon Changes in Capitalization. (a) If the outstanding shares of Common Stock are increased, decreased, changed into, or been exchanged for a different number or kind of shares or securities of the Company through reorganization, merger recapitalization, reclassification, stock split, reverse stock split or similar transaction, appropriate and proportionate adjustments may be made by the Committee in the number and/or kind of shares which are available for issuance under the Plan or subject to purchase under outstanding options and on the option exercise price or prices applicable to outstanding options. No adjustments shall be made for stock dividends. For the purposes of this paragraph, any distribution of shares to shareholders in an amount aggregating less than twenty percent (20%) of the outstanding shares shall be deemed a stock dividend.

      (b) Upon the dissolution or liquidation of the Company, or upon a reorganization, merger or consolidation of the Company with one or more corporations as a result of which the Company is not the surviving corporation, or upon a sale of substantially all of the property or stock of the Company to another corporation, the holder of each option then outstanding under the Plan will thereafter be entitled to receive at the next exercise date upon the exercise of such option for each share as to which such option shall be exercised, as nearly as reasonably may be determined, the cash, securities and/or property which a holder of one share of the Common Stock was entitled to receive upon and at the time of such transaction. The Board of Directors of the Company shall take such steps in connection with such transactions as the Board shall deem necessary to assure that the provisions of this Section 10.04 shall thereafter be applicable, as nearly as reasonably may be determined, in relation to the said cash, securities and/or property as to which such holder of such option might thereafter be entitled to receive.

      10.05     Amendment and Termination. The Board of Directors of the Company shall have complete power and authority to terminate or amend the Plan; provided, however, that the Board of Directors of the Company shall not, without the approval of the stockholders of the Company (i) increase the maximum number of shares which the Company may purchase to provide participants with stock under the Plan; (ii) amend the requirements as to the class of employees eligible to purchase stock under the Plan; or (iii) permit the members of the Committee to purchase Common Stock under the Plan. No termination, modification, or amendment of the Plan may, without the consent of an Employee then having an option under the Plan to purchase Common Stock, adversely affect the rights of such Employee under such option. The Plan shall automatically terminate at the close of business on January 1, 2017 unless sooner terminated by action of the Board of Directors.

      10.06     Effective Date. The Plan shall become effective as of January 1, 1997, or such earlier date as the Board of Directors may determine, subject to approval by the holders of the majority of the Common Stock present and represented at a special or annual meeting of the shareholders of the Company to be held within 12 months before or after the date the Plan is adopted by the Board of Directors of the Company. If the Plan is not so approved, the Plan shall not become effective.

      10.07     No Employment Rights. The Plan does not, directly or indirectly, create any right for the benefit of any employee or class of employees to purchase any shares under the Plan, or create in any employee or class of employees any right with respect to continuation of employment by the Company, and it shall not be deemed to interfere in any way with the Company’s right to terminate, or otherwise modify, an employee’s employment at any time.

      10.08     Costs and Expenses. No brokerage commissions or fees shall be charged by the Company in connection with the purchase of shares of Common Stock by participants under the Plan. All costs and expenses incurred in administering the Plan shall be borne by the Company.

      10.09     Effect of Plan. The provisions of the Plan shall, in accordance with its terms, be binding upon, and inure to the benefit of all, all successors of each Employee participating in the Plan, the executors, administrators or trustees thereof, heirs and legatees, and any receiver, trustee in bankruptcy or representative of creditors of such Employee.

      10.10     Governing Law. The law of the State of Minnesota, other than the conflict of laws provisions of such law, shall govern all matters relating to this Plan except to the extent it is superseded by the laws of the United States.

POLARIS INDUSTRIES INC.

ANNUAL MEETING OF SHAREHOLDERS

THURSDAY, APRIL 20, 2006
9:00 a.m.

Corporate Headquarters
2100 Highway 55
Medina, MN 55340

This proxy is solicited by the Board of Directors for use at the Annual Meeting on April 20, 2006.

The shares of stock you hold in your account or in a dividend reinvestment account will be voted as you specify below.

If no choice is specified, the proxy will be voted “FOR” Items 1, 2 and 3.

By signing this proxy, you revoke all prior proxies and appoint Thomas C. Tiller and Michael W. Malone, and each of them, as Proxies, with full power of substitution, to vote your shares of Common Stock, $.01 par value of Polaris Industries Inc., on the matters shown on the reverse side and any other matters which may come before the Annual Meeting of Shareholders to be held on April 20, 2006, or any postponements or adjournments thereof.

See reverse for voting instructions.

 

There are three ways to vote your Proxy

VOTE BY PHONE — TOLL FREE — 1-800-560-1965 — QUICK ««« EASY ««« IMMEDIATE

•	Use any touch-tone telephone to vote your proxy 24 hours a day, 7 days a week, until 12:00 p.m. (CT) on Wednesday April 19, 2006.
•	Please have your proxy card and the last four digits of your Social Security Number or Tax Payer Identification Number available. Follow the simple instructions the voice provides you.

VOTE BY INTERNET — http://www.eproxy.com/pii/ — QUICK ««« EASY ««« IMMEDIATE

•	Use the Internet to vote your proxy 24 hours a day, 7 days a week, until 12:00 p.m. (CT) on April 19, 2006.
•	Please have your proxy card and the last four digits of your Social Security Number or Tax Payer Identification Number available. Follow the simple instructions to obtain your records and create an electronic ballot.

VOTE BY MAIL

Mark, sign and date your proxy card and return it in the postage-paid envelope we’ve provided or return it to Polaris Industries Inc., c/o Shareowner Services^SM, P.O. Box 64873, St. Paul, MN 55164-0873.

If you vote by Phone or Internet, please do not mail your Proxy Card

   Please detach here