It featured aluminium alloy ALSi7Mg cylinder heads, cast by Cosworth, with enlarged intake ports and smaller exhaust ports, two parallel BorgWarner K04-series turbochargers, two larger side-mounted intercoolers, dished piston crowns, stronger connecting rods, larger intake ducting, an enlarged exhaust system, and a re-calibrated engine management system.

It had multipoint sequential fuel injection, a mass airflow sensor, and six individual ignition coils.

A six-speed manual transmission (parts code prefix: 01E, identification code: FDP) (gear ratios—1st: 3.500, 2nd: 1.889, 3rd: 1.320, 4th: 1.034, 5th: 0.806, 6th: 0.684), cooled by a NACA duct in the engine undertray, and Audi's Torsen-based quattro system, using the Torsen T-1 "automatic torque biasing" center differential, with a 50:50 default bias were standard.

[6] Brakes were also developed jointly in house by Audi's quattro GmbH, not by Porsche as with its predecessor, the RS2.

It was unveiled in February 2005 at Audi's 'quattro Night' celebration at the company headquarters in Ingolstadt, Germany.

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.

Constructed from fully galvanised steel[7] unibody,[7] the B7 RS 4 uses aluminium for its front wings (fenders) and bonnet (hood).

Over the B7 A4, it also includes two larger frontal side air intakes[8] (for the two additional side-mounted coolant radiators).

The B7 RS 4 also includes optional adaptive headlights, which swivel around corners in conjunction with steering wheel movements.

[8] Unique carbon fiber interior trims,[8] along with a lap timer within the central Driver Information System,[8] aluminium pedal caps and footrest,[8] and RS 4 logos[8] complete the look.

In the saloon, luggage space, measured according to the VDA 'block method',[7] is 460 litres (16.2 cu ft) with the rear seats in the upright position,[7] and 720 to 833 litres (25.4 to 29.4 cu ft) with the seats folded flat[7] (dependent on specification).

[7] A Bose ten-speaker sound system, with 190 watt output and automatic dynamic noise compensation, with "Concert II" radio and single CD player is standard equipment.

Additional options include the "Symphony II"[8] system which features twin radio tuners, a single-slot loading six-CD changer, and a cassette player all integrated into a double-DIN sized unit.

To achieve maximum body stiffness with controlled deformation crumple zones, the B7 RS 4 features laser beam welding of major seams of the high-strength steel body shell, which helps improve overall structural rigidity, particularly in the "passenger cell", over traditional spot welding methods.

[8] The Recaro shell-type RS race bucket seats (not available in North American markets) include electrically inflatable upper and lower side bolsters and adjustable lumbar support.

It has four valves per cylinder (instead of five on the earlier variant) and two overhead camshafts on each cylinder bank (making it "quad cam"), which are driven by roller chains with variable valve timing[11] for both inlet and exhaust camshafts,[7] along with a cast magnesium alloy fixed tract length intake manifold with adjustable tumble flaps (to improve low engine speed combustion).

Another focus of the B7 RS 4 was on the introduction of the latest development of Audi's quattro permanent four-wheel drive system.

Audi stressed that this would result in a more neutral response in corners and a more dynamic driving experience.

Front and rear axle differentials are conventional "open" types, with a final drive ratio of 4.111.

The B7 RS 4 also incorporates Audi's "Dynamic Ride Control"[8] "Sports Suspension"[8] mechanism.

[7] Compared to standard [B7 A] models, the RS 4 features a 30 mm (1.2 in) lower ride height.

[8] An optional "Sports Suspension Plus"[8] lowers the car by a further 10 mm (0.4 in), and marginally further stiffens the damper rates.

A lighter and more performant "Audi ceramic" front brake system was an option from 2007 model year onwards (and only with 19 inch wheels).

It comprised cross-drilled, radially vented and floating Carbon fibre-reinforced Silicon Carbide composite SGL Carbon discs, 380 mm (15.0 in) diameter and 38 mm (1.50 in) thick, with grey Brembo monoblock six-piston fixed aluminium calipers.

The North American Insurance Institute for Highway Safety (IIHS) crash-tested the B7 RS 4's sibling, the B7 A4, and awarded it "Double Best Pick" for frontal and side crashes—beating rivals such as the BMW 3 Series, the Mercedes-Benz C-Class, however at the 2012 session of the SOT (small overlap test) the A4 was rated Poor, rating applying up to the 2016 MY.

The interior dashboard and door liners are also detailed with carbon fibre inserts as standard although there were options to change this to aluminium or piano black.

The new RS 4 Avant is powered by a 2.9 TFSI V6 twin-turbo engine producing 450 PS (331 kW; 444 bhp) and 600 N⋅m (443 lbf⋅ft) of torque.

This means that the new RS4 B9 produces the same power as the previous model (B8) while making more torque (extra 170 Nm) from a smaller displacement engine, resulting in better fuel efficiency and acceleration.

The B7 RS 4 was planned to replace the C5 RS6 in the Sports Car Club of America (SCCA) Speed World Challenge, but after Champion Racing had prepared the car, it was decided not to compete in the series, due to rule changes imposed by the SCCA on Audi concerning 4WD systems, wheel size, and engine power output.