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Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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MIC-Info: RSA-MD5,RSA,
 FHEjA5uSRbdJkiwz6rGvZLCocM+Em7FP6B8ur4e9fl7gS/FIRWxTLFeBk8c5mnLU
 kAIojNwnVMNx2zP8GWTqdQ==

<SEC-DOCUMENT>0001179110-06-004705.txt : 20060224
<SEC-HEADER>0001179110-06-004705.hdr.sgml : 20060224
<ACCEPTANCE-DATETIME>20060224130700
ACCESSION NUMBER:		0001179110-06-004705
CONFORMED SUBMISSION TYPE:	4
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20060222
FILED AS OF DATE:		20060224
DATE AS OF CHANGE:		20060224

REPORTING-OWNER:	

	OWNER DATA:	
		COMPANY CONFORMED NAME:			WILLIAMS LARRY E
		CENTRAL INDEX KEY:			0001215694

	FILING VALUES:
		FORM TYPE:		4
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-13711
		FILM NUMBER:		06641935

	MAIL ADDRESS:	
		STREET 1:		C/O WALTER INDUSTRIES INC
		STREET 2:		4211 W BOY SCOUT BLVD
		CITY:			TAMPA
		STATE:			FL
		ZIP:			33607

ISSUER:		

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			WALTER INDUSTRIES INC /NEW/
		CENTRAL INDEX KEY:			0000837173
		STANDARD INDUSTRIAL CLASSIFICATION:	GEN BUILDING CONTRACTORS - RESIDENTIAL BUILDINGS [1520]
		IRS NUMBER:				133429953
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	BUSINESS ADDRESS:	
		STREET 1:		1500 N DALE MABRY HWY
		CITY:			TAMPA
		STATE:			FL
		ZIP:			33607
		BUSINESS PHONE:		8138714811

	MAIL ADDRESS:	
		STREET 1:		1500 N DALE MABRY HWY
		STREET 2:		1500 NORTH MABRY HGWY
		CITY:			TAMPA
		STATE:			FL
		ZIP:			33607

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	HILLSBOROUGH HOLDINGS CORP
		DATE OF NAME CHANGE:	19910814
</SEC-HEADER>
<DOCUMENT>
<TYPE>4
<SEQUENCE>1
<FILENAME>edgar.xml
<DESCRIPTION>FORM 4 -
<TEXT>
<XML>
<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0202</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2006-02-22</periodOfReport>

    <notSubjectToSection16>0</notSubjectToSection16>

    <issuer>
        <issuerCik>0000837173</issuerCik>
        <issuerName>WALTER INDUSTRIES INC /NEW/</issuerName>
        <issuerTradingSymbol>WLT</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001215694</rptOwnerCik>
            <rptOwnerName>WILLIAMS LARRY E</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>4211 W. BOY SCOUT BLVD.</rptOwnerStreet1>
            <rptOwnerStreet2></rptOwnerStreet2>
            <rptOwnerCity>TAMPA</rptOwnerCity>
            <rptOwnerState>FL</rptOwnerState>
            <rptOwnerZipCode>33607</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>0</isDirector>
            <isOfficer>1</isOfficer>
            <isTenPercentOwner>0</isTenPercentOwner>
            <isOther>0</isOther>
            <officerTitle>Senior Vice President</officerTitle>
            <otherText></otherText>
        </reportingOwnerRelationship>
    </reportingOwner>

    <nonDerivativeTable>
        <nonDerivativeTransaction>
            <securityTitle>
                <value>Common Stock</value>
            </securityTitle>
            <transactionDate>
                <value>2006-02-22</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>A</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
                <footnoteId id="F1"/>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>2035</value>
                </transactionShares>
                <transactionPricePerShare>
                    <value>0</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>19460.77</value>
                    <footnoteId id="F2"/>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </nonDerivativeTransaction>
    </nonDerivativeTable>

    <derivativeTable>
        <derivativeTransaction>
            <securityTitle>
                <value>Non-qualified Stock Option</value>
            </securityTitle>
            <conversionOrExercisePrice>
                <value>66.605</value>
            </conversionOrExercisePrice>
            <transactionDate>
                <value>2006-02-22</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>A</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>2085</value>
                </transactionShares>
                <transactionPricePerShare>
                    <value>0</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <exerciseDate>
                <footnoteId id="F3"/>
            </exerciseDate>
            <expirationDate>
                <value>2016-02-22</value>
            </expirationDate>
            <underlyingSecurity>
                <underlyingSecurityTitle>
                    <value>Common Stock</value>
                </underlyingSecurityTitle>
                <underlyingSecurityShares>
                    <value>2085</value>
                </underlyingSecurityShares>
            </underlyingSecurity>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>2085</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </derivativeTransaction>
    </derivativeTable>

    <footnotes>
        <footnote id="F1">Award of Restricted Stock Units which vest in 7 years (02/22/2013) subject to accelerated vesting upon certain conditions.</footnote>
        <footnote id="F2">Includes shares held by Reporting Person under Employee Stock Purchase Plan.</footnote>
        <footnote id="F3">Options vest in 3 equal annual installments beginning 02/22/2007.</footnote>
    </footnotes>

    <ownerSignature>
        <signatureName>Catherine C. Bona, by power of attorney</signatureName>
        <signatureDate>2006-02-24</signatureDate>
    </ownerSignature>
</ownershipDocument>
</XML>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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