There was no RS 4 built on the Audi "B6" platform that served as the basis for the Audi A4 between 2001 and 2005. However, after a long hiatus, the second Audi RS 4 quattro (Typ 8E), was built on Audi's "B7" A4 platform, by quattro GmbH in Neckarsulm, Germany. It was unveiled in February 2005 at Audi's 'quattro Night' celebration at the company headquarters in Ingolstadt, Germany.

The RS 4 became available to European customers in mid-2006. It was introduced at the 2006 North American International Auto Show in January, and arrived in June 2006 in North America. The production run of the B7 RS 4 was 2006 to 2008 inclusive, although only 2007 and 2008 model year were sold in the United States. To date, approximately 10,000 B7 RS 4s have been built, of which around 2,500 are in the USA.

The B7 RS 4 Cabriolet, available in Europe from late 2006 to 2008, was made available as a model year 2008 vehicle in the USA.

Audi factory numbers indicate that the B7 RS 4 saloon can accelerate from 0 to 100 kilometres per hour (0.0 to 62.1 mph) in 4.8 seconds, and arrive at 0 to 200 kilometres per hour (0.0 to 124.3 mph) in 16.6 seconds.Most European magazines recorded results in line with the November 2009 comparison of "ultimate sedans", in Road & Track, which recorded a 0 to 60 time of 4.5 seconds. This is consistent with the pattern of conservatism that is usually found in Audi's official performance numbers. For the Avant, 0 to 100 kilometres per hour (0.0 to 62.1 mph) is reached in 4.9 seconds. Top speed for all variants is "officially" electronically limited to 250 kilometres per hour (155.3 mph), though some owners have reported that the speed limiter is rather "liberal", conforming to the pattern of previous Audi "RS" cars, with genuine top speeds of 270 kilometres per hour (170 mph) being recorded.