The third-generation Transit received a facelift to the body, introduced in July 2006, including new front and rear lights, a new front end and a new interior featuring the gearstick on the dashboard and Ford's new corporate radio design. Besides the styling changes, the powertrains were revised. The old petrol engine was replaced with one from the Ford Ranger, the front-wheel-drive diesel went from 2.0 to 2.2 litres capacity, and all diesel engines gained high-pressure common rail (TDCi) systems. The powertrains were changed to meet new emissions legislation. Additionally, the facelift introduced CAN bus electronics to the Transit for the first time. The new version (Ford nomenclature V347 for front-wheel drive and V348 for rear-wheel drive) won International Van of the Year for 2007 despite tough competition from several all-new rivals. This Transit arrived in Mexico to replace the Freestar after the 2007 model year. This was the first Transit with a five-cylinder engine available (in the 3.2L 200PS version).

Mid-2006 saw the launch of the "Sport Van", a production van featuring the 130 PS (96 kW) engine with additional styling parts, "Le Mans" stripes and 18-inch alloy wheels.

Late-2007 saw the launch of the 140 PS (103 kW) engine for front-wheel-drives (replacing the 130 PS) complete with the VMT6 6-speed manual transaxle to cope with the extra power.

The 6-speed transaxle was introduced on the mid-power FWD in late 2008 when the 110 PS (81 kW) engine was upped to 115 PS (85 kW).

In late 2008, the "coated Diesel Particulate Filter" (cDPF)—designed to meet higher emission standards than the current Euro IV requirement—was introduced as an option on all diesel engines. Production ended in 2013, with the Southampton plant closing down making this generation the last of the British built Transits, but returned in China in two modified forms.