UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934

Filed by the Registrant x

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x Definitive Proxy Statement

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o Soliciting Material Pursuant to § 240.14a-12

Temple-Inland Inc.

(Name of Registrant as Specified In Its Charter)

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

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1300 MoPac Expressway South
Austin, Texas 78746

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

To Be Held Friday, May 5, 2006

To the Stockholders of Temple-Inland Inc.

NOTICE IS HEREBY GIVEN that the 2006 Annual Meeting of Stockholders (Annual Meeting) of Temple-Inland Inc., a Delaware corporation (the Company), will be held at the Company’s offices located at 303 South Temple Drive, Diboll, Texas 75941, on Friday, May 5, 2006, at 9:00 a.m., local time, for the following purposes:

1. To elect four (4) directors to the Board of Directors of the Company to hold office until the expiration of their terms or until their respective successors have been duly elected and have qualified;

2. To ratify the appointment by the Audit Committee of the Board of Directors of Ernst & Young LLP as independent registered public accounting firm for the Company for the fiscal year ending December 30, 2006; and

3. To transact such other business as may properly come before the Annual Meeting or any adjournment(s) thereof.

The Board of Directors has fixed the close of business on March 8, 2006 as the record date (the Record Date) for the determination of stockholders entitled to notice of and to vote at the Annual Meeting or any adjournment(s) thereof. Only common stockholders of record on the Record Date will be entitled to notice of and to vote at the Annual Meeting.

For assistance in voting your shares, please call D. F. King & Co., Inc. at (800) 714-3312.

By Order of the Board of Directors

Leslie K. O’Neal
Secretary

Austin, Texas

March 22, 2006

YOU ARE CORDIALLY INVITED TO ATTEND THE MEETING.  HOWEVER, WHETHER OR NOT YOU PLAN TO BE PRESENT AT THE MEETING, YOU ARE URGED TO MARK, SIGN, DATE AND RETURN THE ACCOMPANYING WHITE PROXY CARD IN THE ENCLOSED, SELF-ADDRESSED, STAMPED ENVELOPE PROMPTLY SO THAT YOUR SHARES OF COMMON STOCK MAY BE VOTED IN ACCORDANCE WITH YOUR WISHES AND IN ORDER THAT THE PRESENCE OF A QUORUM MAY BE ASSURED AT THE MEETING. YOUR PROXY WILL BE RETURNED TO YOU IF YOU SHOULD REQUEST SUCH RETURN IN THE MANNER PROVIDED FOR REVOCATION OF PROXIES ON THE INITIAL PAGE OF THE ENCLOSED PROXY STATEMENT.

TABLE OF CONTENTS

1300 MoPac Expressway South

Austin, Texas 78746

PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS
SOLICITATION AND REVOCABILITY OF PROXIES

This Proxy Statement is furnished in connection with the solicitation of proxies by the Board of Directors of Temple-Inland Inc. (the Company) for use at the 2006 Annual Meeting of Stockholders (Annual Meeting) to be held on Friday, May 5, 2006, at the time and place and for the purposes set forth in the accompanying Notice of Annual Meeting of Stockholders, and at any adjournment(s) thereof. This Proxy Statement and form of proxy are first being sent to the stockholders of the Company on or about March 22, 2006.

The accompanying form of proxy is designed to permit each stockholder entitled to vote at the Annual Meeting to vote for or withhold voting for any or all nominees for election as director, to vote for or against or to abstain from voting on proposal 2 and to grant discretion to the proxies to vote with respect to any other proposal brought before the Annual Meeting. When a stockholder’s proxy card specifies a choice with respect to a voting matter, the shares will be voted and will be voted as specified. If no such specifications are made, the accompanying form of proxy will be voted at the Annual Meeting: FOR the election of the nominees under the caption Election of Directors and FOR ratification of the selection of Ernst & Young LLP as independent registered public accounting firm for the Company for the fiscal year ending December 30, 2006.

Execution of the accompanying proxy will not affect a stockholder’s right to attend the Annual Meeting and vote in person. Any stockholder giving a proxy has the right to revoke it by giving written notice of revocation to the Secretary of the Company at its principal executive offices at any time before the proxy is voted or by executing and delivering a later-dated proxy or by attending the Annual Meeting and voting his or her shares in person. No such notice of revocation or later-dated proxy, however, will be effective until received by the Company at or prior to the Annual Meeting.

The Company has retained D.F. King & Co., Inc. (D.F. King), a professional proxy solicitation firm, to assist in the solicitation of proxies. In addition to the solicitation of proxies by use of the mail, employees of D.F. King, and directors, officers and regular employees of the Company, as yet undesignated, may solicit the return of proxies by personal interview, mail, electronic mail, facsimile, telecopy, telegram, telephone, and internet. You may also be solicited by means of press releases issued by the Company or postings on our corporate website, www.templeinland.com. Officers and employees of the Company will not receive additional compensation, but will be reimbursed for out-of-pocket expenses. D.F. King will be reimbursed for its expenses in soliciting proxies and, in addition, will receive a proxy solicitation fee not to exceed $18,000. D.F. King expects that approximately 75 of its employees will assist in the solicitation. Brokerage houses and other custodians, nominees and fiduciaries will be requested to forward solicitation material to the beneficial owners of stock. All costs of solicitation are to be borne by the Company.

The Annual Report to Shareholders, covering the Company’s fiscal year ended December 31, 2005 and including audited financial statements, is enclosed herewith. The Annual Report does not form any part of the material for the solicitation of proxies.

PURPOSES OF THE MEETING

At the Annual Meeting, the stockholders of the Company will consider and vote upon the following matters:

1. To elect four (4) directors to the Board of Directors of the Company to hold office until the expiration of their terms or until their respective successors have been duly elected and have qualified;

2. To ratify the appointment by the Audit Committee of the Board of Directors of Ernst & Young LLP as independent registered public accounting firm for the Company for the fiscal year ending December 30, 2006; and

3. To transact such other business as may properly come before the Annual Meeting or any adjournment(s) thereof.

VOTING SECURITIES AND PRINCIPAL STOCKHOLDERS

General

The Board of Directors of the Company has fixed the close of business on March 8, 2006 as the record date (the Record Date) for the determination of stockholders entitled to notice of and to vote at the Annual Meeting. On the Record Date, there were 111,013,852 shares of Common Stock of the Company issued and outstanding. The Common Stock is the only class of stock outstanding and entitled to vote at the Annual Meeting. Each share of Common Stock is entitled to one vote on all matters to be acted on at the Annual Meeting. The attendance, in person or by proxy, of the holders of a majority of the issued and outstanding shares of Common Stock entitled to vote at the Annual Meeting is necessary to constitute a quorum to transact business.

Confidential Voting Policy

On February 5, 1993, the Board of Directors of the Company adopted a confidential voting policy. The policy provides that stockholder proxies, ballots, and voting tabulations that identify the vote of the specific stockholder will not be disclosed to the Company, its directors, officers, or employees except in certain limited situations such as when legally necessary or when expressly requested by a stockholder.

Security Ownership of Certain Beneficial Owners

The following table and notes thereto indicate the name, address and stock ownership of each person or group of persons known by the Company to own beneficially more than five percent (5%) of the outstanding shares of Common Stock as of March 8, 2006.

Name and Address	Amount and Nature of			Percent of
of Beneficial Owner	Beneficial Ownership			Class(1)
Franklin Mutual Advisers, LLC		9,865,880	(2)		8.9	%
101 John F. Kennedy Parkway
Short Hills, NJ 07078

(1)	There were 111,013,852 shares of Common Stock outstanding on March 8, 2006.
(2)	Based on a statement on Schedule 13G dated February 15, 2006, filed with the SEC, Franklin Mutual Advisers, LLC, in its capacity as investment advisor, may be deemed beneficial owner of these shares, which are owned by numerous investment advisory clients.

Security Ownership of Management

The following table and notes thereto set forth certain information regarding the beneficial ownership of the Common Stock as of March 8, 2006 by (i) each of the Company’s directors and nominees for director,

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(ii) the Chief Executive Officer and the four other most highly compensated executive officers, and (iii) all directors and executive officers of the Company as a group.

	Amount and			Beneficial
	Nature of			Ownership
	Beneficial			Percent of			Additional		Total
Beneficial Owner	Ownership(1)			Class(2)			Ownership(7)(8)		Ownership
Afsaneh M. Beschloss		20,000	(3)(7)(8)		*			23,526		43,526
Donald M. Carlton		18,000	(3)(7)(8)		*			27,078		45,078
Cassandra C. Carr		10,000	(3)(7)(8)		*			26,999		36,999
E. Linn Draper, Jr.		16,000	(3)(7)(8)		*			18,792		34,792
Kenneth R. Dubuque		51,097	(3)(4)(7)(8)		*			191,147		242,244
Larry R. Faulkner		200	(3)(7)(8)		*			28,093		28,293
James T. Hackett		24,200	(3)(7)(8)		*			44,794		68,994
Jeffrey M. Heller		16,000	(3)(7)(8)		*			21,439		37,439
Kenneth M. Jastrow, II		1,078,003	(3)(4)(7)(8)		*			460,879		1,538,882
James A. Johnson		36,600	(3)(7)(8)		*			40,609		77,209
J. Patrick Maley III		51,244	(3)(4)(7)		*			102,776		154,020
W. Allen Reed		23,000	(3)(7)(8)		*			44,707		67,707
Jack C. Sweeny		214,600	(3)(4)(7)(8)		*			73,576		288,176
Arthur Temple III		791,538	(3)(5)(6)(7)(8)		*			33,994		825,532
Larry E. Temple		21,000	(3)(7)(8)		*			39,634		60,634
M. Richard Warner		228,460	(3)(4)(5)(7)		*			83,208		311,668
All directors and executive officers (26 persons) as a group		3,480,364	(3)(4)(5)(6)(7)(8)		3.14	%		1,687,60		5,167,824

*	Represents less than one percent.
(1)	Beneficial ownership as reported in the above table has been determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended (Rule 13d-3). Unless otherwise indicated, beneficial ownership includes both sole voting and sole dispositive power. Certain of the directors and executive officers disclaim beneficial ownership with respect to certain of these shares. Unless otherwise indicated, the above table does not include any shares that may be held by pension and profit-sharing plans of the corporations or endowment funds of educational and charitable institutions for which various directors and officers serve as directors or trustees.
(2)	Based upon a total of 111,013,852 shares of Common Stock issued and outstanding on March 8, 2006.
(3)	Includes the following number of shares of Common Stock issuable upon the exercise of options exercisable within a period of 60 days from March 8, 2006: Ms. Beschloss-20,000; Dr. Carlton-16,000; Ms. Carr-8,000; Dr. Draper-16,000; Mr. Dubuque-18,000; Dr. Faulkner-0; Mr. Hackett-24,000; Mr. Heller-16,000; Mr. Jastrow-881,148; Mr. Johnson-31,000; Mr. Maley-27,000; Mr. Reed-23,000; Mr. Sweeny-136,000; Mr. Temple III-22,000; Mr. L. Temple-4,000; Mr. Warner-132,900; and all directors and executive officers (26 persons) as a group 2,347,906.
(4)	Includes 1,097, 8,029, 244, 11,089, and 1,836 shares of Common Stock held for Messrs. Dubuque, Jastrow, Maley, Sweeny and Warner, respectively, and 48,921 shares of Common Stock held for all directors and executive officers (26 persons) as a group by trusts under two (2) employee stock plans of the Company’s subsidiaries. These shares are considered by the SEC to be beneficially owned for purposes of this Proxy Statement.
(5)	Includes 2,000 shares of Common Stock owned by certain relatives of Mr. Temple III, 26,494 shares of Common Stock owned by relatives of Mr. Warner, and 31,969 shares of Common Stock owned by relatives of all directors and executive officers (26 persons) as a group. Certain of these shares may be considered by the SEC to be beneficially owned for purposes of this Proxy Statement. Certain of the named individuals disclaim any beneficial interest in such shares.

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(6)	Includes 134,460 shares of Common Stock held in a trust over which Mr. Temple III is trustee. Mr. Temple III has a future income interest with respect to 67,230 of these shares and a remainder interest with respect to 67,230 of these shares. Also includes 20,166 shares held by various trusts and custodial accounts, with respect to which Mr. Temple III has sole voting and dispositive power. Mr. Temple III disclaims any beneficial ownership with respect to these 20,166 shares. Includes 274,380 shares held in two trusts for Mr. Temple III and certain of his relatives with respect to which he has a present income interest and is also a co-trustee. Also includes 117,000 shares held in a trust with respect to which Mr. Temple III has a remainder interest. Does not include 2,521,252 shares of Common Stock held by the T.L.L. Temple Foundation, a charitable trust, of which Mr. Temple III is Chairman of the Board of Trustees. Mr. Temple III shares voting and dispositive power. Mr. Temple III disclaims any beneficial ownership with respect to such shares.
(7)	Includes the following number of shares of Common Stock issuable upon the exercise of options with exercise dates and terms ranging from May 8, 2006 through January 2, 2017: Ms. Beschloss-0; Dr. Carlton-4,000; Ms. Carr-12,000; Dr. Draper-4,000; Mr. Dubuque-62,600; Dr. Faulkner-20,000; Mr. Hackett-0; Mr. Heller-4,000; Mr. Jastrow-255,000; Mr. Johnson-5,000; Mr. Maley-85,800; Mr. Reed-5,000; Mr. Sweeny-56,600, Mr. Temple III-0; Mr. L. Temple-0; Mr. Warner-53,500; and all directors and executive officers (26 persons) as a group-930,051. These options are not required to be reported under Rule 13d-3 and the shares underlying these options are not considered beneficially owned under Rule 13d-3. These amounts are not included in the amounts under the heading Amount and Nature of Beneficial Ownership in the above table.
(8)	Includes the following number of phantom shares under the Company’s stock plan(s) which are payable in stock at retirement: Ms. Beschloss-23,526; Dr. Carlton-23,078; Ms. Carr-14,999; Dr. Draper-14,792; Mr. Dubuque-145,185; Dr. Faulkner-8,093; Mr. Hackett-44,794; Mr. Heller-17,439; Mr. Jastrow-205,879; Mr. Johnson-35,609; Mr. Maley-16,976; Mr. Reed-39,707; Mr. Sweeny-16,976; Mr. Temple III-33,994; Mr. L. Temple-39,634; Mr. Warner-29,708 and all directors and executive officers (26 persons) as a group 822,609. These amounts are not included in the amounts under the heading Amount and Nature of Beneficial Ownership in the above table.

Equity Compensation Plan Information

The following table sets forth information as of the fiscal year ended December 31, 2005, with respect to compensation plans under which our Common Stock may be issued:

					Number of Securities
					Remaining Available
					for Future Issuance
	Number of Securities		Weighted-Average		Under Equity
	to be Issued Upon		Exercise Price of		Compensation Plans
	Exercise of Outstanding		Outstanding Options,		(Excluding Securities
	Options, Warrants and		Warrants and		Reflected in Column(a))
Plan Category	Rights(a)		Rights(b)		(c)(1)
Equity compensation plans approved by security holders		9,160,337	$	24.75		3,068,468
Equity compensation plans not approved by security holders		None		None		None
Total		9,160,337	$	24.75		3,068,468

Beginning January 2003, we voluntarily adopted the prospective transition method of accounting for stock-based compensation contained in SFAS No. 148, Accounting for Stock-Based Compensation — Transition and Disclosure, an amendment of FASB Statement No. 123. The principal effect of adopting the prospective transition method is that the fair value of stock options granted in 2003 and thereafter is charged to expense over the vesting period.

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The Financial Accounting Standards Board has issued SFAS No. 123 (revised December 2004), Share based payment, which requires that the cost of all employee stock options, as well as other equity-based compensation arrangements, be reflected in the financial statements based on their estimated fair value. SFAS No. 123R will be effective for us beginning first quarter 2006. The effects of SFAS No. 123R on our earnings or financial position will be significantly mitigated because we were already charging to expense, over the vesting period, the fair value of employee stock options granted in 2003, 2004, and 2005.

ELECTION OF DIRECTORS

The By-laws of the Company provide that the number of directors that constitutes the Board of Directors shall be established by vote of the Board of Directors and that the directors shall be classified with respect to the time for which they severally hold office into three classes, which classes shall as nearly as possible be equal in size. The Board of Directors has set the number of directors at twelve (12), with three classes of four (4) directors each.

Directors are elected by a plurality of the votes cast by the holders of the Company’s Common Stock at a meeting at which a quorum is present. Plurality means that the individuals who receive the largest number of votes cast are elected as directors up to the maximum number of directors to be chosen at the meeting. Consequently, any shares not voted (whether by abstention, broker nonvote or otherwise) have no impact in the election of directors.

Nominees

Unless otherwise indicated in the enclosed form of proxy, the persons named in such proxy intend to nominate and vote for the election of the following nominees for the office of director of the Company, to serve as directors for three (3) years or as otherwise stated herein, or until their respective successors have been duly elected and have qualified. All nominees are presently serving as directors. After review of their qualifications, the Nominating and Governance Committee recommended them as nominees to the full Board, and the full Board subsequently voted to recommend them to the stockholders as nominees. The Company does not pay a fee to any third party to identify or evaluate or to assist in identifying or evaluating potential nominees.

Nominees for Director to be Elected at the 2006 Annual Meeting of Stockholders

Name and Year First Elected Director	Principal Occupation and Other Information
Cassandra C. Carr 2004	Ms. Carr, 61, is Senior Advisor, Public Strategies, Inc. (since April 2002). Public Strategies, Inc. is a strategic consulting and communications firm which manages campaigns around issues affecting businesses. Ms. Carr was Senior Executive Vice President, External Affairs, SBC Communications, Inc., San Antonio, TX (telecommunications) (October 1998 — March 2002). Formerly Senior Vice President, Human Resources (May 1994 — September 1998). Ms. Carr is also a director of YRC Worldwide Inc.
James T. Hackett 2000	Mr. Hackett, 51, is Chairman, President and Chief Executive Officer of Anadarko Petroleum Corporation since January 2006 and has served as President and Chief Executive Officer since December 2003. Anadarko Petroleum Corporation is an independent oil and gas exploration and production company, with revenues of $6.1 billion. Mr. Hackett was President and Chief Operating Officer of Devon Energy Corporation from April 2003 until December 2003. Mr. Hackett was Chairman (from January 2000), President and Chief Executive Officer (from March 1999) of Ocean Energy, Inc., an independent oil and gas exploration and production company, until its merger with Devon Energy Corporation in April 2003. Mr. Hackett is also a director of Anadarko Petroleum Corporation and Fluor Corporation.

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Name and Year First Elected Director	Principal Occupation and Other Information
Arthur Temple III 1983	Mr. Temple III, 64, is Chairman of the Board of First Bank & Trust, East Texas (FB&T), a position he has held since March 1992. FB&T is a locally owned community bank headquartered in Diboll, Texas. FB&T is owned by Diboll Bancshares, Inc., a locally-owned bank holding company with total assets of $537 million. Since November 2000, Mr. Temple III has also served as Chairman of the T.L.L. Temple Foundation, a charitable foundation with assets of $350 million. Mr. Temple III served as Chairman of the Board of Exeter Investment Company from 1975 to early 1982 and from March 1986 until June 2002. From 1973 until 1980 Mr. Temple III served as a member of the Texas legislature and from January 1981 until March 1986 he served as a member and Chairman of the Railroad Commission of Texas, which regulates mineral resources in Texas. Mr. Temple III also serves on the Board of the Company’s Guaranty Bank subsidiary.
Larry E. Temple 1991	Mr. Temple, 70, is an attorney and during the last five years has been in private practice. He has served as Chairman of the Texas Select Committee on Higher Education, as Chairman of the Texas Higher Education Coordinating Board, and as a member of the Texas Guaranteed Student Loan Corporation. Mr. Temple has also served on several boards of the University of Texas and is a member of the Board and President of the Lyndon B. Johnson Foundation. Mr. Temple formerly served as Special Counsel to President Lyndon B. Johnson and as an Executive Assistant to Texas Governor John Connally. Mr. Temple also serves on the Board of the Company’s Guaranty Bank subsidiary and is Chairman of Guaranty’s audit committee.

Each of the above named nominees has consented to being named in the proxy statement and to serve if elected. If any nominee becomes unavailable to serve, however, the persons named in the enclosed form of proxy intend to vote the shares represented by the proxy for the election of such other person or persons as may be nominated or designated by management, unless they are directed by the proxy to do otherwise.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF MS. CARR, MR. HACKETT, MR. TEMPLE III, AND MR. L. TEMPLE AS DIRECTORS OF THE COMPANY.

Continuing Directors

The following information is provided with respect to directors who will continue to serve as directors of the Company until the expiration of their terms.

Directors to Serve Until the 2007 Annual Meeting of Stockholders

Name and Year First Elected Director

Principal Occupation and Other Information

Donald M. Carlton 2003

Dr. Donald M. Carlton, 68, former President and Chief Executive Officer of Radian International LLC, an Austin, Texas based engineering and technology firm with revenues of $330 million, was acquired by URS Corporation. Dr. Carlton held these positions from January 1996 until his retirement in December 1998. Dr. Carlton also serves as a director of National Instruments Corp., American Electric Power Company, Inc., and as a trustee of 32 Legg Mason mutual funds.

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Name and Year First Elected Director	Principal Occupation and Other Information
E. Linn Draper, Jr. 2004	Dr. Draper, 63, served as Chairman of the Board of American Electric Power Company, Inc. from April 1993 until his retirement in February 24, 2004 and also served as President and CEO from April 1993 until December 31, 2003. Dr. Draper also served as President of Ohio Valley Electric Corporation and Indiana-Kentucky Electric Corporation from 2002 until March 4, 2004. Dr. Draper is also a director of Northwestern Corporation, Alpha Natural Resources, Alliance Data Systems, and TransCanada Corporation.
Kenneth M. Jastrow, II 1998	Chairman and Chief Executive Officer of the Company. Mr. Jastrow, 58, was elected to his current office effective January 1, 2000. He served as Group Vice President of the Company from April 1995 until February 1998, as President and Chief Operating Officer from February 1998 until December 1999, and as Chief Financial Officer of the Company from November 1991 until December 1999. Mr. Jastrow is also a director of MGIC Investment Corporation and KB Home.
James A. Johnson 2000	Vice Chairman of Perseus LLC, a merchant bank and private equity fund management firm. Mr. Johnson, 62, served as Chairman and Chief Executive Officer of Johnson Capital Partners until March 2001, as Chairman of the Executive Committee of the Board of Fannie Mae in December 1999 and as Chairman and Chief Executive Officer of Fannie Mae from February 1991 through December 1998. He is also a director of Target Corporation, The Goldman Sachs Group, Inc., KB Home, UnitedHealth Group, and Gannett Co., Inc.

Directors to Serve Until the 2008 Annual Meeting of Stockholders

Name and Year First Elected Director

Principal Occupation and Other Information

Afsaneh M. Beschloss 2002

Ms. Beschloss, 50, serves as President and Chief Executive Officer of The Rock Creek Group, formerly Carlyle Asset Management Group., a position she has held since May 2001. The Rock Creek Group manages $2.0 billion in investments. Ms. Beschloss served as Director of Investments and Chief Investment Officer of the World Bank from September 1996 to February 1999, and as Treasurer from February 1999 until May 2001. In these positions, Ms. Beschloss was responsible for managing $65 billion in assets and a $30 billion funding strategy, as well as $160 billion in derivatives and structured products. While at the World Bank, Ms. Beschloss was also instrumental in developing a $3 billion portfolio of alternative investment funds as well as private equity strategies. Prior to that position, she served as Senior Manager for Derivatives and Structured Products and Director and Chief Investment Officer of the World Bank’s Investment Management Department. Prior to joining the World Bank, Ms. Beschloss worked for J.P. Morgan. Ms. Beschloss also serves on the board of AMB Property Corporation.

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Name and Year First Elected Director	Principal Occupation and Other Information
Larry R. Faulkner 2005	Larry R. Faulkner, 61, is President of Houston Endowment, Inc. since February 2006. Houston Endowment is one of the largest private foundations in Texas. Dr. Faulkner served as President of the University of Texas from April 1998 until January 2006. He served as Provost and Vice Chancellor for Academic Affairs (1994 through April 1998), Dean of the College of Liberal Arts and Sciences (1989 — 1994), and Head of the Department of Chemistry (1984 — 1989), University of Illinois, Urbana-Champaign campus, where he served on the faculty for twenty-five years. Dr. Faulkner is Chair of the Board of Trustees of the University Corporation for Advanced Internet Development (Internet2). Dr. Faulkner serves on the board of the Sandia Corporation, Lyndon Baines Johnson Foundation, National Association of State Universities and Land Grant Colleges, and the National Center for Educational Accountability. Dr. Faulkner also serves on the Board of the Company’s Guaranty Bank subsidiary and is a member of Guaranty’s audit committee.
Jeffrey M. Heller 2004	Mr. Heller, 66, is President of Electronic Data Systems, Inc. (EDS). Mr. Heller rejoined EDS in March 2003 after a brief retirement and served as President and Chief Operating Officer until October 2005. Mr. Heller previously served as Vice Chairman of EDS from November 2000 until retirement in February 2002. EDS, with revenues for 2004 of more than $20 billion, provides a broad portfolio of business and technology solutions to its clients worldwide. EDS’ core portfolio comprises information technology (IT), applications and business process services, as well as IT transformation services. Mr. Heller is also a director of EDS, Mutual of Omaha, and Trammell Crow Company.
W. Allen Reed 2000	Mr. Reed, 58, is Chairman of General Motors Asset Management Corporation, an investment and asset management company with assets under management of more than $150 billion. Mr. Reed served as President and Chief Executive Officer from July 1994 until December 31, 2005. He also serves as Chairman and CEO of the GM Trust Bank and as a Corporate Vice President of General Motors Corporation. He is also a director of iShares, MSCI Series, Inc., and General Motors Acceptance Corporation (GMAC) and is a member of the Board of Executives of the New York Stock Exchange.

Certain Relationships and Related Transactions; Director Independence

There is no family relationship between any of the nominees, continuing directors and executive officers of the Company. Arthur Temple III and Larry E. Temple are not related.

The Board of Directors has determined that the following Directors meet its independence standards, which are set forth in the Governance Guidelines on the Company’s website at www.templeinland.com:  Afsaneh M. Beschloss, Donald M. Carlton, Cassandra C. Carr, E. Linn Draper, Jr., Larry R. Faulkner, James T. Hackett, Jeffrey M. Heller, James A. Johnson, W. Allen Reed, Arthur Temple III, and Larry E. Temple. Mr. Jastrow, the Company’s Chairman, does not meet the independence standards because he is an employee of the Company. The Board defines independence as meeting the requirements to be considered independent directors as defined under the rules of the New York Stock Exchange (NYSE), as they may be amended from time to time. The Board has established the following additional guidelines to assist it in determining director independence:

1. If not otherwise prohibited by the rules of the NYSE, the following commercial or charitable relationships will not be considered material relationships that would impair a Director’s independence: any relationship that is not required to be reported in the Company’s proxy statement to stockholders under applicable securities laws.

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2. To serve as a member of any committee of the Board, the Director must meet any additional requirements of independence set forth in the committee’s charter or applicable law.

From time to time, the Company’s mortgage lending subsidiary and/or its Bank may have made, in the ordinary course of business, mortgage loans and/or home equity lines of credit to directors, executive officers, or their immediate families. Such mortgage loans and/or home equity lines of credit were made on substantially the same terms, including interest rates and collateral requirements, as those prevailing at the time for comparable transactions with other persons, and did not involve more than the normal risk of collectibility or present other unfavorable features. The Company may sell these mortgage loans and/or home equity lines of credit into the secondary market in the ordinary course of business.

There are no material relationships between the Company and any director.

Section 16(a) Beneficial Ownership Reporting Compliance

Based solely upon a review of Forms 3 and 4 and amendments thereto furnished to the Company pursuant to Rule 16a-3(e) of the Securities Exchange Act during its most recent fiscal year and Forms 5 and amendments thereto or written representations in lieu of Form 5 furnished to the Company with respect to its most recent fiscal year, the Company has not identified any person who failed to file on a timely basis, as disclosed in the above forms, reports required by Section 16(a) of the Exchange Act during the most recent fiscal year or prior fiscal years.

Committees of the Board of Directors

The Board performs certain of its functions through committees. Set forth below is a description of the functions of those committees and the members of the Board serving on such committees. All members of the Audit Committee, Management Development and Executive Compensation Committee, and Nominating and Governance Committee consist solely of independent directors, and an independent director is the chairman of each committee, in each case as independence is defined in the NYSE listing standards applicable to the Company. Each committee’s charter expressly provides that the committee has the sole discretion to retain, compensate, and terminate its advisors. Current copies of the charters of the Audit Committee, Management Development and Executive Compensation Committee, and the Nominating and Governance Committee are available to stockholders on the Company’s website at www.templeinland.com.

A fourth committee, the Executive Committee, is also described below.

Audit Committee.  The Audit Committee of the Board of Directors assists the Board in monitoring the integrity of the Company’s financial statements and financial reporting procedures, the adequacy of the Company’s internal accounting and financial controls, and the independence and performance of the Company’s internal and external auditors. The Audit Committee has the sole authority to retain, compensate, and terminate the Company’s independent registered public accounting firm. The Board of Directors has determined that there is at least one audit committee financial expert serving on the Audit Committee, James T. Hackett, who is an independent director. In addition, the Board of Directors has determined, in its business judgment, that all members of the Audit Committee are financially literate and independent as such terms are defined in the NYSE corporate governance standards. The members of the Audit Committee are Mr. Hackett (Chairman), Ms. Beschloss, Dr. Carlton, Ms. Carr, Dr. Faulkner, Mr. Heller, and Mr. L. Temple. During 2005, the Audit Committee met nine (9) times.

Executive Committee.  The Executive Committee may exercise all the authority of the Board of Directors in the management of the business and affairs of the Company, except for matters related to the composition of the Board, changes in the By-laws and certain other significant corporate matters. The members of the Executive Committee are the Chairman of the Board, who will serve as Chairman of the Executive Committee, and the Chairman of each standing committee of the Board. The Executive Committee met two (2) times in 2005.

Management Development and Executive Compensation Committee.  The Management Development and Executive Compensation Committee (Compensation Committee) is responsible for ensuring that a proper

9

system of short- and long-term compensation is in place to provide performance-oriented incentives to management; over-seeing management succession and development plans; making recommendations concerning compensation programs, retirement plans and other employee benefit programs; approving the salaries and bonuses of all officers of the Company and certain other personnel; and making recommendations with respect to bonus, stock option, restricted stock, phantom stock, stock performance, stock appreciation rights or other current or proposed incentive plans. The members of the Compensation Committee are Mr. Johnson (Chairman), Ms. Carr, Dr. Draper, Mr. Hackett, and Mr. Heller, all of whom are independent as such term is defined in the NYSE corporate governance standards. During 2005, the Compensation Committee met four (4) times.

Nominating and Governance Committee.  The Nominating and Governance Committee periodically reviews the structure of the Board to assure that the proper skills and experience are represented on the Board, recommends nominees to serve on the Board of Directors, reviews potential conflicts of prospective Board members, recommends the size of the Board, recommends the membership of the committees, reviews corporate governance issues, reviews shareholder proposals, reviews outside directorships in other publicly held companies by senior officers of the Company, and acts in an advisory capacity to the Board of Directors regarding the Company’s activities that relate to matters of public policy and the environment, issues of social and public concern, as well as significant legislative, regulatory and social trends. Nominees to serve on the Board of Directors are selected on the basis of recognized achievements and their ability to bring various skills and experience to the deliberations of the Board, as described in more detail in the Corporate Governance Guidelines available on the Company’s website at www.templeinland.com. All nominees, whether recommended by the Nominating and Governance Committee or by a stockholder, are evaluated using the same criteria described in the Corporate Governance Guidelines. Nominees must be independent as defined in the listing standards of the NYSE and must not possess a prohibited conflict of interest with the Company’s business or ownership, including any regulatory conflicts due to the Company’s ownership of banking and financial services operations. Priority will be given to individuals who possess outstanding business experience and who are currently serving or have served as the Chief Executive Officer of a company. The members of the Nominating and Governance Committee are Mr. Reed (Chairman), Ms. Beschloss, Dr. Carlton, Dr. Faulkner, Mr. Temple III, and Mr. L. Temple, all of whom are independent as such term is defined in the NYSE corporate governance standards. During 2005, the Nominating and Governance Committee met four (4) times.

The Nominating and Governance Committee will consider director candidates recommended by stockholders who (i) are entitled to vote for the election of directors at the stockholders’ meeting and (ii) comply with the following notice procedures. Pursuant to the Company’s By-laws, notice of a stockholder’s intent to make a nomination for the Board of Directors must contain certain specified information regarding the nominating stockholder and the nominee. Each notice must set forth (a) as to each proposed nominee (i) the name, age, business address and, if known, residence address of each such nominee, (ii) the principal occupation or employment of each such nominee, (iii) the number of shares of stock of the Company which are beneficially owned by each such nominee, and (iv) any other information concerning the nominee that must be disclosed as to nominees in proxy solicitations pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (including such person’s written consent to be named as a nominee and to serve as a director if elected); and (b) as to the stockholder giving the notice (i) the name and address, as they appear on the Company’s books, of such stockholder, and (ii) the class and number of shares of the Company which are beneficially owned by such stockholder. The Company may require any proposed nominee to furnish such other information as may reasonably be required by the Company to determine the eligibility of such proposed nominee to serve as a director of the Company. This information must be received by the Secretary of the Company not less than 75 days nor more than 100 days prior to the anniversary date of the immediately preceding annual meeting of stockholders. In the case of an annual meeting called for a date more than 50 days prior to such anniversary date or in the case of a special meeting of stockholders, the information must be received not later than the close of business on the 10th day following the date on which notice of such annual meeting or special meeting is first mailed to stockholders or made public, whichever occurs first.

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Compensation Committee Interlocks and Insider Participation

There are no Compensation Committee interlocks among the members of the Board and no member of the Compensation Committee has a transaction reported under Certain Relationships and Related Transactions.

Board Meetings

During 2005, the Board of Directors held four (4) meetings. Each director attended at least 75% of the aggregate of the total number of meetings of the Board of Directors and the total number of meetings held by all committees of the Board on which he or she served. Health permitting, all Board members are expected to attend the Company’s annual meeting of stockholders. In 2005, all Board members attended the annual meeting of stockholders, except James A. Johnson. Effective August 2002, the Board formalized its long-standing practice of holding regularly scheduled executive sessions of the Board with only non-management directors present. A session with only independent directors was held in conjunction with each of the four (4) regularly scheduled Board meetings in 2005. The Chairmen of the Audit, Compensation, and Nominating and Governance Committees serve as Presiding Director to lead non-management executive sessions of the Board on a two-year rotation cycle.

Communication with Directors

Shareholders may communicate with non-management Directors by forwarding their written comments to an independent third party that has agreed to forward the comments to the Presiding Director with a copy to the Company’s General Counsel. The current Presiding Director is James A. Johnson. The address of such independent third party is posted on the Company’s website at www.templeinland.com, and any changes in the Presiding Director after publication of this proxy statement will also be posted on this website.

Director Compensation

Directors who are not employees of the Company receive an annual retainer of $40,000 and a $2,500 fee for attendance at regular and special Board meetings (increased to $50,000 and $3,500, respectively, for 2006). Directors who serve on committees of the Board receive $1,500 for each committee meeting held in conjunction with a Board meeting and $2,500 for each other committee meeting. The chairman of the Audit Committee receives an additional retainer of $15,000 (increased to $20,000 in 2006) and each member of the Audit Committee receives an additional annual retainer of $5,000 in recognition of the increased workload generated by service on this committee. The chairmen of other committees of the Board receive an additional annual retainer of $8,500 (increased to $12,500 in 2006). Directors are reimbursed for expenses incurred in attending Board and committee meetings, including those for travel, food and lodging. Directors who are employees of the Company are not compensated for their Board and committee activities. Directors are covered under the Company’s business travel accident insurance policy for $100,000 while traveling on Company business and are covered under the Company’s director and officer liability insurance policies.

Under the Company’s Stock Incentive Plan, each person who is first elected a non-employee director is automatically granted upon such election a nonqualified stock option covering 20,000 shares of Common Stock at an exercise price per share equal to the fair market value of the stock on the date the option is granted. Directors also receive an annual grant of 2,000 shares of phantom stock.

Directors may participate in a fee deferral plan that encourages stock ownership by granting a match of 133% in the form of phantom stock units on amounts deferred. The number of phantom stock units is determined by dividing the deferred or matching amount by the value of the Company’s stock on the date deferred. A director will receive stock for fees deferred through 2005 and cash for fees deferred beginning in 2006 in payment of the phantom stock units at retirement. Directors who choose cash payment on a current basis instead of deferring their fees will not receive a match.

Both the Directors’ fee deferral plan and the frozen directors’ retirement plan (which does not count service after 2000) contain provisions for accelerating payment in the event of a change in control if the

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director’s service terminates, along with a gross-up provision in the event the director is required to pay excise tax on the accelerated payment.

Mr. Larry E. Temple, Mr. Arthur Temple III, and Dr. Larry R. Faulkner also serve on the board of Guaranty Bank, a wholly-owned subsidiary of the Company. Guaranty’s board is composed of a majority of independent directors. For serving on Guaranty’s board, non-management directors receive the following fees: $50,000 annual retainer for service on Guaranty’s board, $11,000 annual retainer for service on the audit committee, $11,000 annual retainer for service as chairman of the audit committee, $11,000 annual retainer for service on the executive committee, and $11,000 annual retainer for service on the loan committee.

In 2005, the Temple-Inland Foundation, a tax exempt foundation funded by contributions from the Company, made a $5,000 donation to a charity or educational institution chosen by each Director and completed a $50,000 donation previously made to a charity or educational institution chosen by a retired Director. Directors are also eligible for the Foundation’s matching gifts program, which matches donations made by employees and Directors 3-for-1 for the first $1,000; 2-for-1 for the next $1,000; and 1-for-1 for the next $1,000, for total possible matching donations of up to $6,000 per person.

Executive Compensation

Report of the Compensation Committee on Executive Compensation

The Company’s executive compensation program is designed to align compensation with business strategy, performance, and stockholder values. The program includes salary, short-term cash incentives, and a stock-based long-term incentive program. The Committee considers all elements of the compensation package in total, rather than any one element in isolation. In 2005, for example, salaries were increased to be competitive, while incentive bonuses were used to reward performance, and long-term incentive awards were made as motivation for future performance. In making compensation decisions, the Committee bases its judgments on a review of personal and business unit performance.

It is the Company’s policy to obtain the maximum deduction on its tax return for compensation paid to its executive officers consistent with the Company’s compensation goals. The Committee has adopted a policy requiring the deferral of any compensation that exceeds the permissible deduction under Section 162(m) of the Internal Revenue Code (Section 162(m)) until such time as the maximum deduction under Section 162(m) may be taken. Except for de minimis amounts, all compensation (including compensation paid in 2005) should qualify for a deduction under Section 162(m). However, the Committee reserves the right to waive this requirement to further the Company’s compensation goals from time to time and revised the policy in 2006 to exclude vesting of restricted stock units (except for the CEO) and payment of dividends on restricted stock and performance stock units.

Temple-Inland’s compensation philosophy is that a significant part of compensation is tied to Company performance. The following paragraphs outline the Compensation Committee’s objectives.

Base Salary.  Base salaries are maintained at competitive levels considering the performance and longevity of the employee’s service. To ensure that the Company’s compensation remains competitive, the Committee from time to time reviews information from independent surveys of comparative companies. Since the market for executive talent extends beyond any particular industry, the survey data include both companies in the industry as well as companies outside the industrial classifications represented in the performance graph below. For example, in 2005 the group of comparative companies for all of the executives except Mr. Dubuque included Bemis Company, Inc., Boise Cascade Corporation, Georgia-Pacific Corporation, International Paper Company, Martin Marietta Materials, Inc., MeadWestvaco Corporation, Owens Corning, Packaging Corporation of America, Pactiv Corporation, Potlatch Corporation, PPG Industries, Inc., Rohm and Haas Company, Smurfit-Stone Container Corporation, Sonoco Products Company, Texas Industries, Inc., Trinity Industries, Inc., Vulcan Materials Company, and Weyerhaeuser Company. In the case of Mr. Dubuque, who is the Group Vice President for Financial Services, the Committee believes that the group of comparative companies should include financial services companies rather than the industrial companies listed above. The group of comparative companies for Mr. Dubuque’s position included Astoria Financial Corporation, Bank of Hawaii,

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Banknorth Group, Inc., Capital One Financial Corporation, Commerce Bancshares, Inc., Compass Bank, First Horizon National Corporation, Huntington Bancshares Incorporated, M & T Bank Corporation, Marshall & Ilsley Corporation, Providian Financial Corporation, Sun Trust Banks, Inc., Synovus Financial Corporation, and Zions Bancorporation. The compensation consultant uses data from these companies to establish the relationship between revenues and compensation from which a market value of pay can be calculated for a specific revenue size, using a statistical technique known as regression analysis. Surveys indicate base salaries for most of the Company’s named executive officers were generally in the mid-ranges. Base salaries are reviewed periodically and were increased in 2005 to remain competitive to the mid-range and to reflect changes in individual officers’ responsibilities. In making its salary decisions, the Committee places its emphasis on the particular executive’s experience, responsibilities, and performance. No specific formula is applied to determine the weight of each factor. However, the Company has historically followed a policy of using the incentive bonus rather than base salary to reward outstanding performance.

Incentive Bonus.  Short-term cash incentive awards are based largely on the performance of the group or business segment in which the individual is a key employee. Included in the evaluation of an employee are the group’s return on investment, the employee’s personal performance, and the degree to which the employee’s actions have laid the groundwork for future earnings. Financial performance of the business segment is given greater weight than other business accomplishments in determining bonus payments. The types and relative importance of specific financial and other business factors (such as accomplishing specific objectives or projects, including successful completion of acquisitions, divestitures, or restructurings) vary among the Company’s executives depending on their positions and the particular operations or functions for which they are responsible. The evaluations of the CEO and President are based on the consolidated results of the Company.

For 2005, the Committee adopted targeted award levels based on levels of return on invested capital (“ROI”). Under the bonus formulas established by the Committee, each of the executive officers was eligible to receive an annual cash incentive payment if certain criteria established by the Committee were met. The criteria was return on investment of the operating group for executives who manage operating groups and consolidated return for other executive officers. The potential payout was a percentage of base salary depending upon the executive’s individual performance, the executive’s level of responsibility, the size and complexity of the operation for which the executive was responsible, and the competitive practices in the marketplace for positions similar to the executive’s position (using the same comparative company groups listed under Base Salary above). The target bonuses for non-named executive officers ranged from 50% to 300% of base salary. The target maximum bonus as a percentage of base salary for each of the named executive officers except Mr. Jastrow was 200%; the target maximum bonus for Mr. Jastrow was 300%. If the return on investment was less than the maximum amount, the bonus payout would be reduced on a predetermined scale by an amount ranging from the target percentage to 0%. The bonus formulas also contemplated the possibility of the payment of additional discretionary incentives, but only if that individual’s performance merited consideration of such additional incentives. The Committee also retained discretion to pay less than the amount indicated by the bonus formulas. The bonus formulas were considered guidelines only except in the case of the CEO, to whom the Committee granted a performance-based award under a shareholder-approved plan to qualify for an exemption under Section 162(m). For the CEO’s award, the Committee retained the right to decrease, but not increase, the payment. The Committee reviewed actual earnings and performance after the end of the year and determined in its business judgment the size of each executive’s award. The Corrugated Packaging Group had earnings of $120 million and an ROI of 5.7% in 2005 compared with $96 million and an ROI of 4.7% in 2004. The Executive Vice President over this segment received a bonus of $350,000 in 2005 compared with $300,000 in 2004. The Forest Products Group had earnings of $238 million and an ROI of 25.3% in 2005 compared with $215 million and an ROI of 22% in 2004. The Group Vice President over this segment received a bonus of $630,000 in 2005 compared with $475,000 in 2004. The Financial Services Group had earnings of $220 million and an ROI of 19.6% in 2005 compared with $207 million and an ROI of 18.4% in 2004. The Group Vice President over this segment received a bonus of $650,000 in 2005 compared with $550,000 for 2004. The Company had consolidated income from continuing operations of $176 million and an ROI of 8.9% in 2005 compared with $157 million and an ROI of 8.5% in 2004. The Chairman and Chief Executive Officer received a bonus of 24,282 phantom

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stock units based on a pre-established performance formula in 2005 compared with $800,000 for 2004. These phantom stock units were valued at $900,000 at the time of grant and had appreciated in value to $1,121,828 based on the Company’s stock price on the date of payment. The President received a bonus of $485,000 in 2005 compared with $400,000 for 2004. No specific weightings have been assigned under the bonus program to the factors considered by the Committee in the exercise of its business judgment.

Under a shareholder-approved plan designed to qualify for an exemption under Section 162(m), the Committee granted a potential maximum annual incentive award to the Chief Executive Officer for 2006 equal to 172,500 phantom shares and a potential maximum annual incentive award to each other named executive officer equal to 150,000 phantom shares. Under the bonus formula, each of the executive officers is eligible to receive an annual cash incentive payment if the Company’s performance meets pre-established return on investment (“ROI”) or earnings criteria. The Committee retains discretion to pay less than the amount indicated by the bonus formula. The Committee will review actual earnings and performance after the end of the year and determine in its business judgment the size of each executive’s actual award.

Long-Term Incentive Awards.  In 2005, the key executives listed in the proxy statement received an annual grant of stock options, restricted stock units and performance stock units under a long-term incentive program. There is no other long-term incentive program. The program is based on a dollar value of options, restricted stock units and performance stock units based on the executive’s position and importance to the Company’s long range performance. The options are granted at market price on the date of the grant and expire in ten (10) years. The options will vest 25% per year on the first, second, third, and fourth anniversaries following the date of grant. Restricted stock units vest on the third anniversary from the date of grant. Performance stock units are restricted stock units that vest 0%, 75%, or 100% on the third anniversary from the date of grant depending on whether the Company’s return on investment during the three fiscal years beginning in the year of the grant meets certain performance criteria as compared with its peer group as specified in Table 5. Both the restricted stock units and performance stock units earn dividends equivalent to dividends paid on the Company’s common stock. Awards are basically set at a percentage of targeted compensation. However, within these guidelines, the Committee also considers previous grants, tenure, and responsibilities of the executive. In the case of a new key executive, or an executive assuming new responsibilities, an initial grant may be made above targeted levels.

To further align executives’ financial interests with those of the Company and its stockholders, the Committee has adopted minimum stock ownership guidelines for these executives:

Value of Ownership of Stock as a Multiple of Annual Salary

	Multiple of
Position	Salary
Chief Executive Officer		5x
Other Named Executive Officers		3x

The Committee has reviewed and is satisfied with the progress of senior executives in meeting these guidelines. The executives who have been in their current position or at their current pay level for five years (the time frame suggested by the Committee to meet the goal) have met the guidelines.

The Chief Executive Officer.  In reviewing Mr. Jastrow’s performance, the Committee considered all of the factors set forth in the above paragraphs. However, the Committee focused primarily on the Company’s performance, measured in large part by its net earnings and return on investment. In 2005, the Committee granted Mr. Jastrow a performance-based bonus under a shareholder-approved plan to qualify for an exemption under Section 162(m). In 2005, the Company had income from continuing operations of $176 million and an ROI of 8.9% and Mr. Jastrow received a bonus of 24,282 phantom stock units based on the performance-based formula. These phantom stock units were valued at $900,000 at the time of grant and had appreciated in value to $1,121,828 based on the Company’s stock price on the date of payment. Mr. Jastrow’s base salary was increased based on competitive salary data from the comparative company group described under Base Salary above.

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As noted above, the size of long-term incentive awards is set in accordance with the individual executive’s responsibilities and performance. The difference in the number of awards granted from year to year is due to variations in the award value on the date of award, as well as adjustments made by the Committee in consideration of promotions. In 2005, Mr. Jastrow received 100,000 options, 50,000 restricted stock units, and 70,000 performance stock units.

Other Information.  Reference is made to the following charts and tables for actual compensation grants and awards to key executives, as well as the Company’s performance for the last five (5) years, and to page 1 of the Company’s Annual Report to Shareholders for information concerning the Company’s profitability.

James A. Johnson, Chairman

Cassandra C. Carr

E. Linn Draper, Jr.

James T. Hackett

Jeffrey M. Heller

Compensation of Named Executives

The following table summarizes all compensation earned with respect to the Company’s last fiscal year by the Chief Executive Officer and the four other most highly compensated executive officers who were serving as executive officers at the end of the last completed fiscal year:

TABLE 1: SUMMARY COMPENSATION TABLE

									Long-Term Compensation
									Awards
			Annual Compensation						Restricted				Securities		Payouts
							Other Annual		Stock				Underlying		LTIP		All Other
Name and Principal					Bonus		Compensation		Award(s)				Options/ SARs		Payouts		Compensation
Position	Year		Salary($)		($)(1)		($)(2)		($)(3)				(#)		($)		($)(4)
									(f)				(g)		(h)		(i)
(a)	(b)		(c)		(d)		(e)		Time		Performance
									Vested		Vested
Kenneth M. Jastrow, II		2005	$	937,240	$	1,121,828	$	56,484	$	1,906,250	$	2,668,750		100,000		0	$	135,348
Chairman and Chief		2004		894,231		800,000	$	52,720		1,524,250		2,133,950		100,000		0		37,000
Executive Officer		2003		844,231		250,000		N/A		681,120		0		110,000		0		27,400
M. Richard Warner		2005	$	500,000	$	485,000		N/A	$	762,500	$	762,500		40,000		0	$	4,000
Former President		2004		500,000		400,000		N/A		426,790		426,790		32,000		0		4,000
		2003		388,942		125,000		N/A		212,850		0		30,000		0		4,000
Kenneth R. Dubuque		2005	$	425,000	$	650,000		N/A	$	381,250	$	381,250		24,000		0	$	150,225
Group Vice President,		2004		392,500		550,000		N/A		304,850		304,850		24,000		0		91,175
Financial Services		2003		372,115		400,000		N/A		212,850		0		32,000		0		91,033
J. Patrick Maley III		2005	$	400,000	$	350,000		N/A	$	533,750	$	533,750		32,000		0	$	4,000
Executive Vice President,		2004		356,731		300,000		N/A		243,880		243,880		18,000		0		4,000
Paper		2003		200,577		150,000		N/A		212,850		0		40,000		0		0
Jack C. Sweeny		2005	$	375,000	$	630,000		N/A	$	381,250	$	381,250		24,000		0	$	4,000
Group Vice President,		2004		347,115		475,000		N/A		243,880		243,880		18,000		0		4,000
Forest Products		2003		322,115		115,000		N/A		148,995		0		20,000		0		4,000

(1)

Although the full amount of the bonuses is shown in this column, the 2005 bonus for Mr. Dubuque was 100% deferred under the Company’s phantom stock plan and will be paid in stock at retirement. A percentage of Mr. Jastrow’s (64% for 2003 and 100% for 2004) and 100% of Mr. Dubuque’s 2003 and 2004 bonuses were also deferred under the Company’s phantom stock plan.

(2)

Each officer is eligible for one or more perquisites. However, the dollar value of perquisites and other personal benefits, or securities or property paid or earned during the fiscal year other than pursuant to a plan, including imputed income from personal use of company aircraft, country club dues, umbrella insurance, car allowance, financial counseling, and/or income tax preparation, does not exceed the lesser of $50,000 or 10% of the annual salary and bonus reported for each officer and is therefore not reported where “N/A”

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	is indicated. In 2005 and 2004, Mr. Jastrow’s amount includes $46,512 and $40,318, respectively, for the incremental cost of personal usage of Company aircraft.
(3)	The dollar value is calculated by multiplying the number of shares awarded by the closing market price of unrestricted stock on the date of grant. The amount shown for each officer consists of restricted stock units that are time vested and performance-based restricted stock units (Performance Stock Units) that will vest 0%, 75%, or 100% depending upon the Company’s achievement of certain return on investment (ROI) performance criteria during the 3-year vesting period (fiscal years 2005, 2006 and 2007, the Award Period) as compared with its peer group as specified in Table 5 (Peer Group). No payment shall be made unless the Company’s average ROI ranking as compared to the Peer Group over the Award Period is in the first or second quartile of ROI rankings. If the Company’s average ROI over the Award Period places it within the first quartile, up to 100% of the Performance Stock Units may be paid. If the Company’s average ROI over the Award Period places it within the second quartile, up to 75% of the Performance Stock Units may be paid. The Compensation Committee retains discretion to reduce the size of the award, but not to increase it. All payments will be made in the form of one share of common stock for each stock unit. At year-end, the dollar value of all restricted shares and restricted stock units (including Performance Stock Units) held by each named officer (calculated using the closing market price on December 30, 2005) was: Mr. Jastrow $14,082,900; Mr. Warner $3,767,400; Mr. Dubuque $2,601,300; Mr. Sweeny $2,152,800; and Mr. Maley $2,421,900. The restricted stock units were granted on February 4, 2005 with a potential vesting date of February 4, 2008. Cash compensation will be paid equal to the amount of dividends these shares would otherwise earn.
(4)	Amounts shown include annual contributions or other allocations to defined contribution retirement plans. The amount shown for Mr. Dubuque also includes $110,000 of matching phantom shares credited to his account in connection with the deferral of his bonus. The amount shown for Mr. Jastrow also includes $131,348 of matching phantom shares credited to his account in connection with the deferral of portions of his salary and bonus. Deferred compensation is eligible for a match of 2% for each year deferred, up to a total of 20% for compensation deferred for ten years or longer.

Each of the five (5) executive officers named above has entered into a change in control agreement dated October 2, 2000 with the Company (CIC Agreement) that provides for three (3) years’ pay and benefits in the event his employment is terminated following certain change in control events. These events include any person or entity acquiring or becoming beneficial owner as defined in SEC regulations of 25% of the combined voting power of the Company’s securities; the pre-event directors ceasing to constitute a majority of the Company’s directors within any 24-month period; consummation of a merger, consolidation, or recapitalization (unless the directors continue to represent a majority of the directors on the board, at least 60% of the pre-event ownership survives, and, in the event of a recapitalization, no person owns 25% of the voting power of the securities); the shareholders of the Company approve liquidation or dissolution of the Company; consummation of an agreement to sell, lease, or dispose of (a) substantially all the assets of the Company, (b) its corrugated packaging operations, (c) its forest products operations (not included in Mr. Dubuque’s agreement), or (d) Guaranty Bank (not included in Mr. Sweeny’s agreement); or any other event that the Board determines to be a change in control. The change in control agreements also contain gross-up provisions in the event the officer is required to pay excise tax on such amounts but only if the payments exceed 110% of the amount that would not be subject to excise tax. Mr. Jastrow’s change in control agreement was amended on February 11, 2005 to conform to the terms of the employment agreement described below, to provide that if Mr. Jastrow gives the company notice during the thirty (30) day period beginning six (6) months after a change in control that he no longer wishes to be employed, he will receive the same severance payments and benefits as if the Company had terminated his employment without cause. Except for the CIC Agreements and the employment agreement with Mr. Jastrow and transition agreement with Mr. Warner described below, none of the other executive officers named above has an employment contract with the Company or an agreement providing for severance payments in the event of termination of employment.

Pursuant to study initiated in February 2004 and discussions initiated by the Board of Directors in August 2004, the Company executed an employment agreement with Mr. Jastrow on February 11, 2005. The agreement has a three-year term, but is automatically extended by one year on the first anniversary of the

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effective date and each anniversary thereafter unless notice of nonrenewal is given at least one year in advance of such anniversary date.

During the term of the agreement, Mr. Jastrow will receive a base salary, which may not be reduced below its level at the time the agreement was entered into ($925,000) or any increase subsequently granted. He will be eligible for a performance-based annual cash bonus, employee benefits, equity (long-term incentive plan) grants, and other perquisites. Other perquisites consists of an automobile allowance, social club memberships, use of the Company aircraft (subject to imputation of income under IRS regulations), financial planning and tax preparation services, and umbrella insurance, all on terms substantially no less favorable than in effect prior to the effective date of the agreement. There are no parameters on the performance-based annual cash bonus, such as a maximum amount, and it is entirely within the discretion of the Compensation Committee except that it shall be substantially no less favorable than the bonus program in effect prior to the effective date of the agreement. The pre-agreement bonus program provided for a bonus of up to 3 times salary if return on investment criteria was achieved; however, the Compensation Committee retained discretion to grant amounts above this amount or for achievement of other accomplishments.

Following the termination of his employment for any reason other than by the Company for cause, Mr. Jastrow and his spouse will continue to receive medical and dental benefits and Mr. Jastrow will continue to have an office and secretarial support until the earlier of attainment of age 70 or his death. If Mr. Jastrow’s employment is terminated by the Company without cause or by Mr. Jastrow for good reason (including failure to be reelected to the board, required relocation, or failure to pay compensation and benefits), he will be entitled to three years’ salary, bonus, and benefits. If Mr. Jastrow’s employment is terminated by reason of his death or disability, he or his estate will receive a benefit equal to his salary and target bonus for the portion of the year in which his death or disability occurred. If Mr. Jastrow’s employment is terminated following a change in control of the Company, the change in control agreement will apply instead of the employment agreement, generally except with respect to medical and dental benefits.

The Company entered into a letter agreement with M. Richard Warner confirming the terms of his employment during the transition period prior to his January 1, 2007 retirement. Mr. Warner resigned as President effective December 31, 2005 and will assume the role of Senior Advisor to the Company during 2006. He will be paid his current salary during 2006. He will not be considered for a bonus for his 2006 service and will not receive any new stock grants in 2006. Prior stock option and restricted stock grants will vest at retirement. Performance-conditioned restricted stock will vest only if the Company meets the applicable performance goals.

During 2005, the Company had a stock incentive plan in place under which options, restricted stock units, and performance stock units were granted to employees. Employees also exercised options granted under a prior plan. Each of the plans was approved by the stockholders and administered by non-employee members of the Board of Directors. The options were granted at full market value on the date of the grant, and these exercise prices have never been reduced.

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The following table summarizes the stock options granted to the five (5) named executive officers in the last fiscal year:

TABLE 2: OPTION/SAR GRANTS IN LAST FISCAL YEAR(1)

	Individual Grants									Grant Date
			Percent of Total							Value(2)
	Number of Securities		Options/SARs			Exercise or				Grant Date
	Underlying Options/		Granted to Employees in			Base Price		Expiration		Present
Name	SARs Granted(#)		Fiscal Year			($/Sh)		Date		Value($)
(a)	(b)		(c)			(d)		(e)		(f)
Kenneth M. Jastrow, II		100,000		9.41	%	$	37.07		02/04/2015	$	1,113,000
M. Richard Warner		40,000		3.76	%	$	37.07		02/04/2015	$	445,200
Kenneth R. Dubuque		24,000		2.26	%	$	37.07		02/04/2015	$	267,120
J. Patrick Maley III		32,000		3.01	%	$	37.07		02/04/2015	$	356,160
Jack C. Sweeny		24,000		2.26	%	$	37.07		02/04/2015	$	267,120

(1)

Options to purchase Temple-Inland Inc. Common Stock. The exercise price is the average of the high and low sales price of a share of Company Common Stock on the New York Stock Exchange on the date of grant. Exercise prices have never been repriced. Withholding taxes may be paid with exercised shares. No general or freestanding stock appreciation rights (SARs) were granted. All grants to the named executive officers under the Stock Incentive Plan include a provision for acceleration of vesting in certain change of control situations. All options awarded to the executives become exercisable in 25% increments on 02/04/2006, 02/04/2007, 02/04/2008, and 02/04/2009.

(2)

The Grant Date Present Value was determined using the Black-Scholes-Merton option pricing model. The expected volatility was measured by the Standard Deviation of a statistical distribution using daily closing stock prices for the last seventeen (17) years for an assumed expected volatility of 28.2%. The annual risk free rate of return during the contractual life of the option (ten years) was assumed to be 4.24%. The expected dividend yield was assumed to be 2.25%. The time of exercise was assumed to be at eight years.

The following table summarizes the stock option exercises and value of options held at year-end of the five (5) named executive officers:

TABLE 3: AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL
YEAR AND FY-END OPTION/SAR VALUES

					Number of Securities				Value of Unexercised
	Shares				Underlying Unexercised				In-The-Money
	Acquired				Options/SARs At Fiscal				Options/SARs
	On		Value		Year-End(#)(2)				At Fiscal Year-End($)(3)
Name	Exercise(#)		Realized($)(1)		Exercisable		Unexercisable		Exercisable		Unexercisable
(a)	(b)		(c)		(d)				(e)
Kenneth M. Jastrow, II		0		0		698,648		335,000	$	11,336,379	$	4,967,100
M. Richard Warner		0		0		173,880		103,400		3,079,910		1,200,608
Kenneth R. Dubuque		0		0		172,600		84,400		3,119,592		1,138,508
J. Patrick Maley, III		0		0		14,500		65,500		288,655		891,545
Jack C. Sweeny		22,710	$	314,767		129,100		71,900		2,275,707		1,037,173

The named executive officers (except for Mr. Dubuque) also participate in defined benefit pension plans of the Company’s subsidiaries, with estimated benefits up to the amounts shown below.

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TABLE 4: PENSION PLAN TABLE
Years of Service

Remuneration	10		15		20		25		30		35
500,000		77,000		250,000		250,000		250,000		250,000		271,000
550,000		85,000		275,000		275,000		275,000		275,000		298,000
600,000		93,000		300,000		300,000		300,000		300,000		326,000
650,000		101,000		325,000		325,000		325,000		325,000		354,000
700,000		109,000		350,000		350,000		350,000		350,000		382,000
750,000		117,000		375,000		375,000		375,000		375,000		410,000
800,000		125,000		400,000		400,000		400,000		400,000		438,000
850,000		133,000		425,000		425,000		425,000		425,000		466,000
900,000		141,000		450,000		450,000		450,000		450,000		494,000
1,000,000		157,000		500,000		500,000		500,000		500,000		550,000
1,100,000		173,000		550,000		550,000		550,000		550,000		606,000
1,200,000		189,000		600,000		600,000		600,000		600,000		662,000
1,300,000		205,000		650,000		650,000		650,000		650,000		718,000
1,400,000		221,000		700,000		700,000		700,000		700,000		774,000
1,500,000		237,000		750,000		750,000		750,000		750,000		830,000
1,600,000		253,000		800,000		800,000		800,000		800,000		886,000
1,700,000		269,000		850,000		850,000		850,000		850,000		942,000

The above table shows the estimated annual pension payable upon retirement to employees in specified remuneration and years-of-service classifications. Retirement benefits are calculated using final average pay based on the highest five (5) of the employee’s last ten (10) years of service. Compensation covered by the Company’s retirement plans includes salaries and bonuses, but excludes all other forms of compensation shown in the foregoing tables such as stock options. Messrs. Jastrow, Warner, Maley, and Sweeny are currently credited with approximately 27, 19.5, 2.5, and 35 years of service, respectively. If such officers continue in the employ of the Company until their respective normal (age 65) retirement dates, at such time they would be credited with approximately 33, 30, 23.5, and 41 years of service, respectively. The estimated amounts are based on the assumption that payments under the Company’s retirement plans will commence upon normal retirement (age 65), that the Company’s retirement plans will continue in force and that the benefit payment will be in the form of a life annuity. Amounts shown in the table above are not subject to any deduction for Social Security or other offset amounts.

Mr. Dubuque participates in a defined contribution pension plan. Under this plan, an amount equal to 3.5% of his compensation is contributed to an account in his name each year. This amount (which is included in the last column of Table 1) is calculated based upon his salary and bonus, but excludes all other forms of compensation shown in the foregoing tables such as stock options. This amount vests after five (5) years of service and is not subject to any deduction for Social Security or other offset amounts.

In 2001, the Board of Directors adopted a nonqualified pension plan for certain designated executives to provide unreduced retirement at age 60 with 15 years of service. Under this plan, the executive’s pension from all Company plans will be a minimum benefit equal to 50% of the executive’s final average pay for the highest five years out of the last ten years of employment. Any executive who does not participate in this plan could have lower benefits than the amounts shown in the above table, depending upon the executive’s years of service.

The Internal Revenue Code limits the amount of compensation that can be used in calculations under tax-qualified retirement plans, and also imposes limits on the amount of benefits that can be paid under such plans. Any pension benefits that cannot be paid under the tax-qualified plans due to these limitations are paid under nonqualified pension plans. The nonqualified plans are unfunded and contain a provision for acceleration of payment in the event of a change in control of the Company. The table above includes benefits under all of the Company’s retirement plans. Benefits are available for early retirement and various payment options are available under all of these plans.

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PERFORMANCE GRAPH

The Company has composed an index of its peers consisting of Abitibi-Consolidated Inc., Bowater Inc., Caraustar Industries, Inc., Domtar Inc., Georgia-Pacific Corporation, International Paper Company, Longview Fibre Company, MeadWestvaco Corporation, Packaging Corporation of America, Smurfit-Stone Container Corporation, and Weyerhaeuser Corporation (Peer Index). Due to industry consolidation and shift in product mix, this peer group varies somewhat from the peer group last year. Georgia-Pacific Corporation is no longer in the Company’s peer group due to its acquisition by Koch Industries, Inc. During the five preceding fiscal years, the Company’s cumulative total stockholder return compared to the Standard & Poor’s 500 Stock Index and to the Peer Index was as shown in the following Table 5:

TABLE 5: TEMPLE-INLAND INC.

ASSUMES $100 INVESTED ON THE LAST TRADING DAY IN FISCAL YEAR 2000
*TOTAL RETURN ASSUMES REINVESTMENT OF DIVIDENDS

REPORT OF THE AUDIT COMMITTEE

The Audit Committee assists the Board of Directors in its oversight of the integrity of the financial statements, compliance with legal and regulatory requirements, and the independence, qualifications, and performance of the independent registered public accounting firm and the internal auditors. Our duties and responsibilities are more fully described in our charter, a copy of which was included as an exhibit to this proxy statement and is available on Temple-Inland’s web site.

Management is responsible for the financial statements, the effectiveness of internal controls over financial reporting, and compliance with legal and regulatory requirements. The independent registered public accounting firm, Ernst & Young LLP, is responsible for auditing the financial statements and the effectiveness of internal controls over financial reporting and expressing its opinion on the conformity of those statements with generally accepted accounting principles and the effectiveness of internal controls over financial

20

reporting. The internal auditors are responsible for evaluating the effectiveness of processes and related controls.

In fulfilling our oversight responsibilities, we met nine (9) times during 2005 with the independent registered public accounting firm, the Director of Internal Audit, and management. At four of the meetings, we also met in executive session without management present. During the course of these meetings, we reviewed and discussed with management and with Ernst & Young LLP the audited financial statements for the year 2005. We also reviewed and discussed the effectiveness of internal controls over financial reporting, the audit plans and results, and the matters required to be discussed with Ernst & Young LLP by Statement of Auditing Standards No. 61, Communications with Audit Committees, as amended. In addition, we reviewed the written disclosures and letter from Ernst & Young LLP required by Independence Standard Board Standard No. 1, as amended, and have discussed with Ernst & Young their independence.

Based on this, we recommended to the Board of Directors that the audited financial statements be included in the Annual Report on Form 10-K for the year ended December 31, 2005, for filing with the Securities and Exchange Commission. In addition, we reported to the Board of Directors that, subject to ratification by the shareholders, we selected Ernst & Young LLP as Temple-Inland’s independent registered public accounting firm for the year 2006.

Chairman:	James T. Hackett
Members:	Afsaneh M. Beschloss
	Donald M. Carlton
	Cassandra C. Carr
	Larry R. Faulkner
	Jeffrey M. Heller
	Larry E. Temple

PROPOSAL TO RATIFY THE SELECTION OF ERNST & YOUNG LLP
AS INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee of the Board of Directors has selected Ernst & Young LLP as the independent registered public accounting firm to audit our consolidated financial statements for the year ending December 30, 2006. Ernst & Young LLP currently serves as our independent registered public accounting firm. Fees paid to Ernst & Young for each of the last two fiscal years were as follows:

	2005		2004
	(In thousands)
Audit Fees(1)	$	3,154	$	3,045
Audit-Related Fees(2)		321		387
Tax Fees(3)		84		90
All Other Fees		—		—
Total	$	3,559	$	3,522

(1)	Audit fees include the annual audit and quarterly reviews of our financial statements, annual statutory audits of foreign subsidiaries’ financial statements, consultation on new accounting standards and current transactions, and normal assistance with annual and periodic filings of our financial statements with the Securities and Exchange Commission.
(2)	Audit-related fees include audits of our employee benefit plans, consultation on the application of proposed accounting standards, and consultation on accounting for proposed transactions.
(3)	Tax fees include assistance in the preparation of our federal, state, and foreign income and franchise tax returns and in the periodic examinations thereof by regulatory authorities and consultation on the tax treatment for transactions.

21

In August 2002, the Audit Committee adopted a policy requiring pre-approval by the Audit Committee of all services provided by the independent registered public accounting firm. The Audit Committee revised the policy in February 2004. Since August 2002, all services provided by the independent registered public accounting firm have been pre-approved by the Audit Committee. Under the pre-approval policy, the Committee pre-approves by type and amount the services expected to be provided by the independent registered public accounting firm during the coming year. This pre-approval is done annually and is documented as an exhibit to the minutes of the Committee meeting. Any services to be provided by the independent registered public accounting firm that are not pre-approved as part of the annual process must be separately pre-approved by the Committee, including the related fees. The Committee must separately pre-approve any significant changes in scope or fees for any approved service. No pre-approval authority is delegated to management. Quarterly, the Committee reviews the specific services that have been provided and the related fees.

The types of services the Committee pre-approves annually are audit, audit-related, and certain tax services. Audit services include the annual audit and quarterly reviews, statutory audits, and normal assistance with periodic SEC filings. Audit-related services include the annual audits of employee benefit plans, consultation on the application of proposed accounting standards, and consultation on accounting for proposed transactions. Tax services include assistance in the preparation of income tax returns and in examinations by taxing authorities and consultation on related tax matters.

A pre-approval subcommittee consisting of the Chairman of the Audit Committee and one other member of the Committee may grant approvals between Audit Committee meetings for services not approved as part of the annual approval process. Such approvals must be reported to the full Committee at its next meeting. Pre-approval is not required for non-audit services that were not recognized as non-audit services at the time of engagement, if the aggregate amount of such services does not exceed the lesser of $100,000 or 5% of the total amount of revenues paid to the independent registered public accounting firm during that fiscal year and such services are promptly brought to the attention of the Audit Committee and approved by the Committee prior to completion of the audit. During 2005, no services were approved pursuant to this exception.

Representatives of Ernst & Young LLP will be present at the Annual Meeting with the opportunity to make a statement if they desire to do so and will be available to respond to appropriate questions from stockholders.

Stockholder ratification is not required for the selection of Ernst & Young LLP, because the Audit Committee of the Board of Directors has the responsibility for selecting our independent registered public accounting firm. The selection, however, is being submitted for ratification by the stockholders at the Annual Meeting. No determination has been made as to what action the Audit Committee would take if stockholders do not ratify the selection.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE RATIFICATION OF ERNST & YOUNG LLP AS INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING DECEMBER 30, 2006.

OTHER MATTERS

Other Business to be Presented

The Board of Directors knows of no other business that may properly be, or that is likely to be, brought before the Annual Meeting. If, however, any other business should properly be presented to the Annual Meeting, the persons named in the accompanying proxy will vote the proxy as in their discretion they may deem appropriate.

22

DATE FOR RECEIPT OF STOCKHOLDER PROPOSALS

Pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, as amended, stockholders may present proper proposals for inclusion in the Company’s proxy statement and for consideration at its Annual Meeting of Stockholders by submitting their proposals to the Company in a timely manner. In order to be so included for the 2007 Annual Meeting, stockholder proposals must be received by the Company by November 22, 2006 and must otherwise comply with the requirements of Rule 14a-8.

The Company’s By-laws contain an advance notice procedure with regard to items of business to be brought before an Annual Meeting of Stockholders by a stockholder. These procedures require that notice be made in writing to the Secretary of the Company and that such notice be received at the executive offices of the Company not less than 75 days nor more than 100 days prior to the anniversary date of the immediately preceding Annual Meeting of Stockholders (or in the case of an annual meeting called for a date more than 50 days prior to such anniversary date, not later than the close of business on the 10th day following the date on which notice of such annual meeting is first mailed to stockholders or made public, whichever occurs first). Shareholder proposals submitted outside the processes of Rule 14a-8 will be considered untimely if they are submitted before January 25, 2007 or after February 19, 2007.  The By-laws require that the notice of the proposal contain certain information concerning the proposing stockholder and the proposal. The Company’s By-laws also contain an advance notice procedure for the nomination of candidates for election to the Board of Directors by stockholders. For a brief description of such procedures, see Committees of the Board of Directors Nominating and Governance Committee. A copy of the By-laws advance notice provision may be obtained, without charge, upon written request to the Secretary of the Company at 1300 South MoPac, Austin, Texas 78746.

* * *

If you have any questions or require assistance, please contact:

D. F. King & Co., Inc.

48 Wall Street

New York, New York 10005

(800) 714-3312

By Order of the Board of Directors

Leslie K. O’Neal

Secretary

Austin, Texas

March 22, 2006

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Appendix A

Audit Committee
CHARTER

I.   Audit Committee Purpose

The purpose of the Audit Committee of the Temple-Inland Inc. Board of Directors is to:

A. Assist the Board of Directors in the oversight of:

•  the integrity of the financial statements;

•  compliance with legal and regulatory requirements;

•  the independent registered public accounting firm’s qualifications and independence; and

•  the performance of the internal audit function and independent registered public accounting firm; and

B. Prepare the report that the rules of the Securities and Exchange Commission (SEC) require be included in the annual proxy statement.

II.   Audit Committee Composition and Meetings

The Audit Committee shall be comprised of not less than three members of the Board of Directors, one of whom shall be designated to serve as Chairman of the Committee. All members of the Audit Committee must be financially literate and at least one member must qualify as an “audit committee financial expert,” as defined in Item 401(h) of Regulation S-K. In addition, each member of the Audit Committee shall:

•  be appointed by the Board of Directors upon recommendation from the Nominating and Governance Committee,

•  be an independent non-executive director,

•  be free from any relationship that would interfere with the exercise of his or her independent judgment, and

•  meet the requirements of independence and any other requirements for audit committee membership established by the SEC or the New York Stock Exchange.

The Audit Committee shall meet at least four times annually, or more frequently as circumstances may require. In order to foster open communication, the Committee will meet at least once annually with a representative of the independent registered public accounting firm, and Director of Internal Audit in separate executive sessions without other members of senior management present to discuss matters that the Committee or any of these persons believe should be discussed privately. The Audit Committee may request any officer or employee, legal counsel, the Director of Internal Audit, or a representative of the independent registered public accounting firm to attend any meeting of the Audit Committee. The Committee shall keep minutes of its meetings and provide regular reports to the Board of Directors.

III.   Duties and Responsibilities

The duties and responsibilities of the Audit Committee are as follows:

Financial Statements

•  Discuss the annual audited financial statements and quarterly financial statements with management and the independent registered public accounting firm, including disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” prior to issuance.

A-1

•  Discuss earnings press releases, as well as financial information and earnings guidance provided to analysts and rating agencies. The responsibility to discuss earnings releases as well as financial information and earnings guidance may be done generally (i.e., discussion of the types of information to be disclosed and the types of presentation to be made). The Audit Committee need not discuss in advance each earnings release or each instance in which earnings guidance is provided.

•  Review with the independent registered public accounting firm any audit problems or difficulties and management’s response, including reviewing with the independent registered public accounting firm:

•  any restrictions placed on the scope of the auditor’s activities or access to requested information;

•  any accounting adjustments that were noted or proposed, but were “passed” by the auditor and not recorded (as immaterial or otherwise);

•  any significant events, transactions, and changes in accounting estimates;

•  any communications between the audit team and the audit firm’s national office with respect to auditing or accounting issues presented by the engagement; and

•  any management or internal control letter issued or proposed to be issued by the independent registered public accounting firm.

•  Consider the auditors’ judgments about the quality and appropriateness of the accounting principles used to prepare the annual and quarterly financial statements.

Internal Controls over Financial Reporting

•  Establish procedures for:

•  the receipt, retention, and treatment of complaints regarding accounting, internal accounting controls, or auditing matters; and

•  the confidential, anonymous submission by employees of concerns regarding questionable accounting or auditing matters.

•  Review management’s report on any fraudulent activity that involved management or other employees who have a significant role in the internal controls.

•  Review management’s annual report on internal controls over financial reporting.

•  Review management’s quarterly report on any significant changes in internal controls over financial reporting that have materially affected, or are reasonably likely to materially affect, the internal controls over financial reporting.

•  Review reports prepared by the internal audit department, together with management’s response, and the implementation status of audit recommendations.

Independent Registered Public Accounting Firm

•  Appoint, retain, compensate, and terminate the independent registered public accounting firm, including the sole authority to approve all audit engagement fees and terms, as well as non-audit engagements with the independent registered public accounting firm in accordance with policies adopted by the Committee.

•  Maintain oversight of the independent registered public accounting firm, including resolution of any disagreements between management and the independent registered public accounting firm.

•  At least annually, obtain and review a report by the independent registered public accounting firm describing:

•  the firm’s internal quality-control procedures;

A-2

•  any material issues raised by the most recent internal quality-control review, or peer review, of the firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues; and

•  all relationships between the independent registered public accounting firm and Temple-Inland.

•  Evaluate the independent registered public accounting firm’s qualifications, performance, and independence, including a review and evaluation of the lead partner of the firm.

•  Assure the regular rotation of the lead audit partner as required by law, and consider whether, in order to assure continuing auditor independence, there should be regular rotation of the audit firm itself.

•  Review and discuss the independent registered public accounting firm’s audit plan, including reliance upon management and internal audit, and general audit approach.

•  Set clear hiring policies for employees or former employees of the independent registered public accounting firm.

Internal Audit

•  At least annually review the:

•  internal audit charter;

•  annual budget, organizational structure and staffing level;

•  annual audit plan, including special projects;

•  methodology used for and the audit plan risk assessment.

•  Annually review and evaluate the performance of the Director of Internal Audit.

•  Periodically review the status of the annual audit plan and any significant changes thereto.

Legal and Regulatory Compliance

•  Review quarterly with the General Counsel any legal or regulatory matters that could have a significant effect on the financial statements.

•  Review quarterly with the Chief Compliance Officer the scope and effectiveness of the legal and regulatory compliance policies and programs.

•  Review periodically the Code of Ethics for Senior Financial Officers and compliance with its terms.

Other Responsibilities

•  At least annually:

•  evaluate the performance of the Committee;

•  review and reassess the adequacy of this Charter, submit the charter to the Board of Directors for approval, and have the document published at least every three years in the proxy statement in accordance with the regulations of the SEC; and

•  prepare the report to stockholders required by the rules of the SEC and include the report in the Company’s proxy statement.

•  At least annually, discuss with management the risk assessment and risk management policies and processes;

•  At least annually review the current summary of derivative and hedging activities;

•  Report regularly to the Board of Directors with respect to:

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•  the quality and integrity of the financial statements;

•  compliance with legal or regulatory requirements;

•  the performance and independence of the independent registered public accounting firms; and

•  the performance of the internal audit function.

•  Perform any other activities consistent with this Charter, the By-laws, and governing law, as the Audit Committee or the Board of Directors deems necessary or appropriate.

IV.   Consultants

The Committee has the sole authority to retain and terminate any consultants, lawyers, accountants, or other professional advisors to assist it, including sole authority to approve the advisors’ fees and other retention terms. The Committee shall receive appropriate funding, as determined by the Committee, from the Company for payment of compensation to the outside legal, accounting, or other advisors employed by the Committee.

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Temple-Inland

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	MR A SAMPLE DESIGNATION (IF ANY) ADD 1 ADD 2 ADD 3 ADD 4 ADD 5 ADD 6	000000000.000 ext 000000000.000 ext 000000000.000 ext 000000000.000 ext C 1234567890 J N T

o Mark this box with an X if you have made changes to your name or address details above.

Annual Meeting Proxy Card   C0123456789     12345  

PLEASE REFER TO THE REVERSE SIDE FOR TELEPHONE AND INTERNET VOTING INSTRUCTIONS.

This Proxy when properly executed will be voted in the manner directed herein by the undersigned stockholder(s). If no direction is made this Proxy will be voted FOR Proposals 1 and 2. The Directors of Temple-Inland Inc. recommend voting FOR proposals 1 and 2.

A Election of Directors

The Board of Directors recommends a vote FOR the listed nominees.

1. Proposal to elect as Directors of Temple-Inland Inc. the following persons to hold office until the expiration of their terms or until their successors have been duly elected and have qualified.

	For	Withhold		For	Withhold
01 - Cassandra C. Carr	o	o	03 - Arthur Temple, III	o	o
02 - James T. Hackett	o	o	04 - Larry E. Temple	o	o

B Issues

The Board of Directors recommends a vote FOR the following proposal.

		For	Against	Abstain
2.	Proposal to ratify the selection of Ernst & Young LLP as registered independent public accounting firm of Temple-Inland Inc. for the fiscal year ending December 30, 2006.	o	o	o	3.	In their discretion the proxies are authorized to vote upon such other business as may properly come before the meeting.
Mark this box with an X if you have made comments below.		o

C Authorized Signatures - Sign Here - This section must be completed for your instructions to be executed.

PLEASE MARK, DATE AND SIGN THIS PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE.

Please sign this proxy exactly as your name appears hereon. When shares are held by joint tenants, both should sign. When signing as attorney, administrator, trustee or guardian, please give full title as such.

Signature 1 - Please keep signature within the box	Signature 2 - Please keep signature within the box	Date (mm/dd/yyyy)
		/     /

1 U P X 0 0 8 4 7 4

Proxy - Temple-Inland Inc.

This Proxy is Solicited on Behalf of the Board of Directors
for the Annual Meeting on May 5, 2006

The undersigned hereby acknowledges receipt of the notice of the Annual Meeting of Stockholders and proxy statement each dated March 22, 2006 and does hereby appoint Kenneth M. Jastrow, II, J. Bradley Johnston and Doyle R. Simons and each of them as Proxies, each with the power to appoint his substitute and hereby authorizes each of them to represent and vote, as designated below, all the shares of Common Stock, par value $1.00 per share, of Temple-Inland Inc. held of record by the undersigned on March 8, 2006 at the annual meeting of stockholders to be held on Friday, May 5, 2006, and any adjournment(s) thereof.

YOUR VOTE IS IMPORTANT

Regardless of whether you plan to attend the Annual Meeting of Stockholders, you can be sure your shares are represented at the meeting by promptly returning your proxy in the enclosed envelope.

Telephone and Internet Voting Instructions

You can vote by telephone OR Internet! Available 24 hours a day 7 days a week!

Instead of mailing your proxy, you may choose one of the two voting methods outlined below to vote your proxy.

	•	Call toll free 1-800-652-VOTE (8683) in the United States or Canada any time on a touch tone telephone. There is NO CHARGE to you for the call.		•	Go to the following web site: WWW.COMPUTERSHARE.COM/EXPRESSVOTE
	•	Follow the simple instructions provided by the recorded message.		•	Enter the information requested on your computer screen and follow the simple instructions.

VALIDATION DETAILS ARE LOCATED ON THE FRONT OF THIS FORM IN THE COLORED BAR.

If you vote by telephone or the Internet, please DO NOT mail back this proxy card.

Proxies submitted by telephone or the Internet must be received by 1:00 a.m., Central Time, on May 5, 2006.

THANK YOU FOR VOTING