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CORRESP
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370
Wabasha Street N

St. Paul, MN 55102

January 30, 2007

  Mr. John Hartz

  United States Securities and Exchange Commission

  Division of Corporation Finance

  100 F Street, N.E.

  Washington, D.C. 20549-7010

  CONFIDENTIAL TREATMENT HAS BEEN
  REQUESTED BY ECOLAB INC. PURSUANT TO SEC RULE 83 FOR INFORMATION INCLUDED IN
  THE RESPONSE TO COMMENT 1, WHICH INFORMATION HAS BEEN DELIVERED TO THE SEC’S
  DIVISION OF CORPORATION FINANCE.

  Re:

  Ecolab Inc.

  Form 10-K for Fiscal Year Ended December 31,
  2005

  Filed February 28, 2006

  File No. 001-09328

Dear Mr. Hartz:

This letter is written in
response to the staff’s comment letter dated December 18, 2006 on the Company’s
Form 10-K for the year ended December 31, 2005.
For ease of reference, the numbered responses correspond to the numbered
paragraphs of the comment letter.  We
have also included the staff’s comment along with our response to assist in the
review process.

Segment Disclosure

1.              Please
identify for us your operating segments pursuant to paragraph 10 of SFAS
131.  As part of your response, please
identify your chief operating decision maker and provide us with copies of the
relevant financial reports reviewed by your chief operating decision maker.

Please also tell us in detail how you determined
that your operating segments met each of the criteria in paragraph 17 of SFAS
131 for aggregation.  To the extent you
are aggregating operating segments because you believe your segments are
economically similar, please provide us with an analysis that includes
historical revenues, gross profits, gross profit margins, operating profits,
and operating profit margins, along with any other information you believe
would be useful for each of your operating segments to help us understand how
these operations are economically similar.
Please also address any differences in the trends these financial
indicators depict (e.g. if operating income is decreasing for one operation and
increasing for another).

Response

As previously discussed
in our June 12, 2001 response to the SEC Comment letter dated April 27, 2001,
the Company carefully considered its compliance with SFAS No. 131 when it was
initially adopted in 1998.  At that time,
the Company met at the FASB’s offices with representatives of the FASB staff
and certain FASB board members (including the chairman),  and discussed the Company’s initial adoption
of SFAS No. 131, specifically the application of the aggregation criteria
included in paragraph 17 of SFAS No. 131 to its operating segments.  Based on the Company’s review of paragraph
17, and its discussions with the FASB board members and staff representatives,
the Company concluded that it had three reportable segments.  Since adoption of SFAS No. 131, there has
been no substantive change in the types of business activities in which the
Company engages.

Based on the definition
of an operating segment as set forth in paragraph 10 of SFAS No. 131, the
Company has 14 operating segments.  These
operating segments are disclosed in the Management Discussion and Analysis  section of our Annual Report and in the
narrative description of business under Item 1(c) of Form 10-K.  Each of the operating segments has a general
manager responsible for business unit performance.

Douglas M. Baker,
Ecolab’s Chairman of the Board, President and CEO, is the chief operating
decision maker (CODM). The CODM considers a variety of operating information to
evaluate performance and allocate resources to the Company’s operating segments
with a long-term goal of strong and sustainable growth.  Operating information for each of the
operating segments is summarized and provided to the CODM and the senior
management team and has been included in Exhibit A to this letter. The
CODM uses operating segment financial reports to assess performance, allocate
resources and make decisions on investments.
Although the Company produces multiple views and subtotals in its
financial reporting analysis, the CODM reviews the Company’s overall
performance on an operating segment and public reporting segment basis.  We are sending the materials in Exhibit A to
you separately and as a supplemental submission under Rule 12b-4 of the
Securities Exchange Act of 1934, as amended, and therefore we respectfully
request that this information be returned to us when you are finished with your
review.  In the event you determine not
to return Exhibit A, we also have specifically requested confidential treatment
of Exhibit A pursuant to 17 C.F.R. Section 200.83.

In applying the
aggregation criteria of paragraph 17 of SFAS No. 131 the Company determined
that several of its domestic operating segments met the aggregation criteria
included in paragraph 17.  These
operating segments were aggregated into the United States Cleaning &
Sanitizing reportable segment.  The
Company’s four international operating segments also met the aggregation
criteria and were combined into the International reportable segment.  The two U.S. operating segments not meeting
the paragraph 17 criteria were combined, based on the guidance in paragraph 21,
into an all other category captioned the “United States Other Services”
reportable segment.  The Company’s
conclusions with respect to each reportable segment are explained further in
the following paragraphs.

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United States Cleaning
& Sanitizing Reportable Segment

The United States
Cleaning & Sanitizing reportable segment includes the following operating
segments:  Institutional, Food &
Beverage, Kay, Textile Care, Healthcare, Vehicle Care, Water Care and
Professional Products (beginning in 2007, this segment will be combined with
Institutional).

Paragraphs 17(a) through
17(d) of SFAS No. 131 established four aggregation criteria – nature of the
product, nature of the production process, class of customer, and method of
distribution – that have been met in aggregating these operating segments into
the United States Cleaning & Sanitizing reportable segment.

·                  The nature of the products sold by
each of these operating segments is similar.
The primary focus of these products is cleaning and sanitizing. Each of
these products meets the cleaning and sanitizing needs of our customers.

·                  The nature of
the production process is similar.  The
operating segment products are manufactured in shared facilities using common
processes and procedures.  As such, the
underlying manufacturing processes are the same for all product lines within
the United States Cleaning & Sanitizing reportable segment.  The manufacturing facilities are operated to
support the product lines of our operating segments.  For example, each of the Company’s
manufacturing facilities produces liquid products, our largest product type,
for all of our United States Cleaning and Sanitizing operating segments (with
the single exception of Kay, which requires specialized packaging equipment).

·                  Each of the
operating segments sells to similar customers.
Large global and regional accounts and distributors represent the vast
majority of the customer base for each of these businesses.  These accounts include large hotel, resort,
restaurant chains, or healthcare facilities, as well as large beverage, dairy
and other food processing accounts.  In
many cases the same customer will purchase products from several of these
individual operating segments.

Consistent with our “Circle the Customer” strategy, the Company’s
operating segments are focused on cross selling opportunities to our core
customer base.  As a result of this
strategy, many global and regional accounts and distributors purchase products
from multiple operating segments.  The
Company will continue to emphasize “Circle the Customer” as a primary growth
strategy.

·                  The methods used
to distribute the products of the United States Cleaning & Sanitizing
businesses are also similar.  The Company
utilizes a network of distribution facilities to drive the lowest delivered
product cost and on time delivery for the customer.  Product is shipped from centralized
distribution centers directly to the Company’s customers.

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The Company has also considered
the similarity of the economic characteristics for the eight operating segments
included in its United States Cleaning & Sanitizing segment.  Based on an average of the last three years,
substantially all of the revenues (87%) and operating income ([***]%) are
comprised of Institutional, Food & Beverage, and Kay operating
segments.  Each of these operating
segments exhibit similar long-term financial performance with average operating
income margins ranging from [***]% to [***]%.
The CODM utilizes operating income margins as a key performance metric
and the Company believes this range of operating income margins constitutes
economic similarity for this reportable segment.

With respect to the five
smaller operating segments (Textile Care, Healthcare, Water Care, Vehicle Care
and Professional Products) which comprise a minority of the reportable
segment’s sales (13%) and operating income ([***]%), the Company acknowledges
the differences in operating margins of these businesses yet believes that these
businesses are best aggregated with the other cleaning and sanitizing
businesses especially after considering (i) they meet all of the aggregation
criteria set forth in paragraphs 17(a) through 17(d) of SFAS No. 131, (ii) the
business approach is consistent with the Company’s “Circle the Customer”
strategy and there is cross selling between these segments and (iii) the
relative insignificance of their overall operations, none of which exceed any
of the quantitative thresholds of paragraph 18 of SFAS No. 131.

Additionally, beginning in
2007 the Company will integrate the Professional Products segment into the
Institutional segment.  Excluding the
Professional Products segment, the remaining four segments had an average
operating margin of [***]% for 2005 and [***]% for 2006.  The Company has considered and acknowledges
that the sales and operating income growth trends may vary for these four
remaining operating segments due to the relative size, market share,
acquisition activity, and competitive position.  However, it is the Company’s expectations that
as these segments continue to grow and capitalize on the “Circle the Customer”
strategy, they have the potential for double digit operating margins.    The Company does not believe this metric
would prevent aggregation under SFAS No. 131.

United States Other
Services Reportable Segment

The United States
Other Services reportable segment includes the Pest Elimination and GCS Service
operating segments. These two operating segments are primarily fee for service businesses
targeted at the Company’s core customer group.
Since the primary focus of these segments is services, they have not
been combined with our United States Cleaning and Sanitizing reportable segment
which sells cleaning and sanitizing products.
Although Pest Elimination and GCS Service segments do not currently
exhibit similar levels of operating profitability, it is our expectation that
the GCS Service operating profits will improve.
The operating segments do not exceed any of the quantitative threshold
criteria of paragraph 18 of SFAS No. 131.
Based on their similar nature and insignificance, these operating segments
were combined and disclosed as an “all other” category in accordance with
paragraph 21 of SFAS No. 131.  Though not
required by SFAS No. 131, the Company has elected to disclose

Ecolab Inc. has made a Rule 83 Confidential
Treatment Request for certain portions of page 4 of this Response Letter marked
by “[***]” and has designated such as Confidential Treatment Request No.
ECL-001.

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supplementary information
regarding these operating segments which goes beyond the requirements of SFAS
No. 131.

The staff has noted that
the Company’s United States Pest Elimination business is part of the United
States Other Services reportable segment while the International Pest
Elimination business is part of the International segment.  The Company discloses in the MD&A section
of the annual report that we manage and evaluate our operations geographically.  As a result the International Pest Elimination
business is managed and evaluated as part of the International reportable
segment.

International Reportable
Segment

The International
reportable segment includes Europe, Middle East and Africa (EMEA), Asia
Pacific, Latin America and Canada operating segments.  In determining whether the Company’s
international operating segments could be considered a reportable segment under
SFAS No. 131, the Company recognizes that the guidance in paragraph 15 of SFAS
No. 131 indicates that product line information would take precedence over
geographic data.  While the Company has
considered this point in its determination, the Company also notes that product
line information for its international businesses is not utilized by Company
management in assessing performance, but rather the Company’s internal
management reporting utilized by the CODM is by geographic regions.  The Company’s international operations are
managed by two international vice president positions that are responsible for
total operating segment results and who report directly to the CODM.  One international vice president is
responsible for Asia Pacific and Latin America and another international vice
president managing the combined segment of Europe, Middle East and Africa
(CODM, Douglas M. Baker, currently is filling this role on a temporary
basis).

The Company’s Canadian
segment is managed by general managers of United States operating segments in
order to leverage operational efficiencies.
However the Canadian segment, which represents 6% of International
revenues and 3% of total revenues, has inherent market and currency risks which
are consistent with operating in an international business environment.  Therefore the Company believes it provides
greater transparency to readers of our financial statements to aggregate the
Canadian business with the International reportable segment.  In this regard, the Company considers each of
the geographic regions to be operating segments.

The Company again refers
to the four aggregation criteria as set out in Paragraphs 17(a) through 17(d)
of SFAS No. 131 that have been met in aggregating these operating segments into
the International reportable segment.

·                  The nature of
the products sold for each of our international operating segments is
similar.  The primary focus of these
products are cleaning and sanitizing.
Each of these products meets the cleaning and sanitizing needs of our
customers. In some instances it is necessary to customize our product to
conform to the local needs and requirements in the international
locations.  This customization, for
example, may consist of changes to

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packaging and regulatory labeling requirements (i.e.
metric system). However, the primary nature of the cleaning and sanitizing
products are similar.

·                  The nature of
the international production process is similar between operating
segments.  Our international operating
segment products are manufactured in shared facilities using common processes
and procedures.  For product lines not
produced in the Company’s international manufacturing facilities, the Company
exports product from manufacturing facilities in the United States and Europe.
As such, the underlying manufacturing processes are the same for all product
lines within the International reportable segment.

·                  Each of the
operating segments sells to similar customers.
Large global and regional accounts and distributors represent the vast
majority of the customer base for each of these geographic regions.  These accounts include large hotel, resort,
restaurant chains, or healthcare