The Audi A8 has been one of our favorite premium luxury sedans of the past few years. With its polished demeanor, spacious and luxurious cabin, and capable road manners, Audi's flagship sedan leaves little to be desired. In fact, it's even been a winner three years in a row, from 2004-'06, of the Edmunds.com Editors' Most Wanted Awards category for "Sedan over $45,000."

On the outside, the 2007 Audi A8 exudes class. Neatly tailored styling lines are complemented by handsome wheels that fill out the wells, giving the A8 the presence of an athlete in a custom-made suit. Inside, Audi has worked its usual magic. Even when pitted against ultra-luxury cars costing twice as much, the A8's interior impresses with its fine materials, attractive design flair and thoughtful features.

In addition to its all-aluminum construction and standard "quattro" all-wheel-drive system, the A8 boasts other high-tech features, such as an adaptive air suspension that provides a plush freeway ride but automatically stiffens up when the car is being pressed on a twisty road. The driver can select one of four settings for the adaptive system: Dynamic (lowest ride height and firmest damping), Automatic, Comfort and Lift (which raises the car up for travel on rough roads). For power, a quietly powerful V8, which has been upgraded for 2007, or a 450-horsepower W12 engine ensure performance in keeping with the A8's autobahn breeding.

For all of its mechanical and design brilliance, the Audi A8 typically trails its main German rivals, the BMW 7 Series and the Mercedes-Benz S-Class, by a considerable margin in annual sales. Brand awareness, marketing or perceived levels of prestige might all be to blame, but not the car. Though there's new and very impressive competition this year, including fully redesigned entries from Lexus and Mercedes-Benz, we strongly encourage any shopper in the premium luxury sedan segment to check out the underappreciated Audi A8.

There are three versions of the 2007 Audi A8: A8 (V8-powered and a standard wheelbase), A8 L (the V8 with an extended wheelbase for increased rear-seat legroom) and A8 W12 (W12-powered with the long-wheelbase body). Even on the standard A8, virtually every high-end luxury feature is standard, including a navigation system, 16-way power front seats, HID headlights and a 12-speaker Bose audio system (with a glovebox-mounted CD changer). The W12 adds keyless startup, power door closers, parking sensors, four-zone climate control, ventilated/massaging front seats, seat heaters and four-way lumbar adjustment (for all passengers), an Alcantara headliner and a wood steering wheel. Most of the W12's features are optional on other A8s. Other options include a 1,000-watt Bang & Olufsen audio system, adaptive cruise control, a personal refrigerator, a sunroof and a Sport package for V8 models that includes a sport-tuned suspension, 20-inch wheels and steering wheel shift paddles.

Standard A8 and A8 L models come with a 4.2-liter, 40-valve V8 that now benefits from direct fuel injection and makes 350 hp and 325 pound-feet of torque. Named after its special engine, the W12 model has a 6.0-liter, 12-cylinder engine that makes 450 hp and 428 lb-ft of torque. The W12 actually consists of two narrow-angle, 15-degree V6 engines joined at the crankshaft, which makes it more compact than a conventional V12. Both engines are matched to a six-speed Tiptronic automatic transmission that drives all four wheels through Audi's quattro all-wheel-drive system. Either way, this is a quick luxury sedan. The 4.2 V8 version can hit 60 mph in 6.3 seconds and cover the quarter-mile in 14.2 seconds, while the W12 betters those stats by about a half second in each case.

The 2007 Audi A8 comes standard with a large array of safety features, including antilock brakes with electronic brakeforce distribution; stability control; a tire-pressure monitor; full-length side curtain airbags that protect occupants' heads; front and rear seat-mounted side airbags that protect occupants' torsos; and active front headrests.

Throttle response is gratifying with either engine. Whether taking off from a stoplight or jetting up to cruising speed on the freeway, a solid rush of power is always on tap. Powerfully reassuring brakes that are easily modulated have no problem reining in the A8. The air suspension is well sorted; left in automatic mode the system works just fine, providing a soft but not mushy ride and solid composure through the twisty bits. And when used in the "Dynamic" setting, body lean is kept to an absolute minimum, making the Audi A8 feel more like a compact sport sedan rather than a large flagship luxury car.

Whether you're driving or riding in the back, there's not a bad seat in the Audi A8 house, especially if you're in the L version, with its 42 inches of rear legroom. Everything you see and touch in the A8 bespeaks the highest quality. Generous amounts of real wood, suede trim and aluminum accents are arranged attractively. With 16-way power adjustment (including upper seatback angle for the shoulders) and a power tilt-and-telescoping steering wheel, finding a comfortable driving position is easy for short and tall folk alike.

The dash is uncluttered by buttons thanks to Audi's Multi Media Interface (MMI), which handles everything from the navigation and audio systems to the adjustment of the driver-selectable air suspension. Mounted in the console and operated via a simple twist-and-press knob and four large surrounding buttons, Audi's MMI may draw comparisons to BMW's iDrive system. But unlike iDrive, MMI is simple and intuitive to operate.