It was the 9th annual Grand Final of the Victorian Football League, staged to determine the premiers for the 1906 VFL season.

The match, attended by 44,437 spectators, was won by Carlton by a margin of 49 points, marking that club's first VFL premiership victory.

The finals were contested using the variation of the amended Argus system seen between 1902 and 1906.

Fitzroy faced fourth-placed Essendon in the First Semi-Final, and won by 36 points, and Carlton faced third-placed Collingwood in the Second Semi-Final and won by ten points.

By virtue of their records, neither club could lose the match and still finish with a better win–loss record than the other; and therefore under the first amended Argus system, there was no chance for a challenge grand final and it was known from the opening bounce that this match would be decisive for the premiership.