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      Correspondence

    Vail
      Resorts, Inc.

    390
      Interlocken Crescent,

    Suite
      1000

    Broomfield,
      CO 80021

    June
      7,
      2007

    Mr.
      Michael Fay

    Securities
      and Exchange Commission

    Division
      of Corporation Finance

    Mail
      Stop
      3561

    Washington,
      DC 20549

    Re:
       Vail
      Resorts, Inc.

    File
      No. 001-09614

    Form
      10-K: For the Fiscal Year Ended July 31, 2006

    Dear
      Mr.
      Fay:

    We
      have
      set forth below our response to the comment of the Securities and Exchange
      Commission (the “Commission”) staff (the “Staff”) in the letter from the Staff
      dated May 11, 2007, regarding the Annual Report on Form 10-K filed by Vail
      Resorts, Inc. (the “Company”) for the fiscal year ended July 31, 2006 (the “Form
      10-K”).

    Form
      10-K: For the Fiscal Year Ended July 31, 2006

    Item
      8. Financial Statements and Supplementary Data

    Consolidated
      Statements of Cash Flows

    Comment
      1: We have reviewed your response to our prior comment number 2. However, we
      believe that cash outflows related to i) investments in real estate and ii)
      the
      development of acquired real estate properties should be classified in the
      operating activities section of your statement of cash flows, to the extent
      that
      such properties are going to be sold to third parties. In this regard, we note
      from the “Item 1. Business” section of your 10-K that your company- through Vail
      Resorts Development Company - actively participates in the planning, oversight,
      marketing, infrastructure improvement and development of real property that
      is
      to be sold to third parties. In addition, we note that you i) regard your real
      estate development activities as a separate operating
      segment of your company, ii) recognize proceeds from the sale of real property
      as revenues (and therefore, cash inflows from operating activities), and iii)
      recognize cash received from real property sales accounted for under the
“deposit method” (i.e., deferred real estate credits) in the operating
      activities section of your statement of cash flows. Given the aforementioned
      factors, we do not believe it is appropriate to report the cash outflows
      associated with the acquisition and/or development of real property that will
      be
      sold to third parties in the investing activities section of your statement
      of
      cash flows, as such treatment does not appear consistent with the classification
      of the cash inflows generated from the sale of these properties.

    Furthermore,
      we note from your response that you believe it is appropriate to report cash
      used for “Investments in real estate” as an investing activity in your statement
      of cash flows because you believe that the more predominant source of future
      cash flows attributable to your real estate investments will be derived from
      your mountain lodging operations. As such, you believe that the cash outflows
      are reflective of investments in productive assets. However, it appears that
      your conclusion is based upon the assumption that cash inflows realized by
      your
      mountain and lodging operations will increase due to the proximity of your
      real
      estate development projects to your resort operations. In this regard, it
      appears that your analysis of the predominant source of future cash flows
      associated with real estate projects that will be developed and then sold is
      based upon the indirect
      cash
      flow benefits that you expect
      your
      mountain and lodging operations to experience as a result of the locations
      of
      these real estate development projects. However, we do not believe that the
      indirect cash flow benefits that you expect to receive after the sale of
      developed real property should outweigh the direct
      cash
      flows that will be received from the sale of the developed real property, when
      A) analyzing the underlying substance of your real estate development activities
      and B) determining the appropriate cash flow classification of such activities.
      Furthermore, we note that the indirect cash flow benefits realized by your
      mountain and lodging operations as a result of your real estate development
      activities are not realized until after the real property is no longer your
      asset, and such benefits may not be directly measurable or
      supportable.

    For
      each of the aforementioned reasons, we believe that you are required to classify
      your cash outflows in the operating activities section of your statement of
      cash
      flows to the extent they relate to “Investments in real estate” which is
      purchased or is developed to be sold to third parties. As such, please revise
      the presentation in your consolidated statements of cash flows. In addition,
      please tell us in detail a) the amount of cash used for investments in real
      estate that will be reclassified, b) how such amount was determined, c) and
      the
      nature and amount(s) of any significant cash outflows related to your
      investments in real estate that you plan to continue to report in the investing
      activities section of your cash flow statement.

    Response
      1: Pursuant to the telephone conversations conducted during the weeks of May
      21,
      2007 and May 28, 2007, between the Staff, the Company, and the Company’s
      independent registered public accounting firm, PricewaterhouseCoopers LLP
      (including a representative of their national office), the Company sets forth
      its response and alternative presentation as requested by the Staff.

    The
      Company has three principal business segments: Mountain, Lodging, and Real
      Estate. The Company’s Mountain segment owns and operates five premier ski resort
      properties which provide a comprehensive resort experience throughout the year
      to a diverse clientele with an attractive demographic profile. The Company’s
      Lodging segment owns/or manages a collection of luxury hotels, a series of
      strategic lodging properties located in proximity to the Company’s ski resorts,
      a destination resort at Grand Teton National Park, the Jackson Hole Golf &
Tennis Club, as well as other golf clubs proximate to its resort operations.
      Collectively, the Mountain and Lodging segments are considered the Resort
      segment that represents the primary operations of the Company. The Company’s
      Real Estate segment holds, develops, buys and in certain situations sells real
      estate in and around the Company’s resort communities.

    All
      of
      the Company’s holdings of real property are located at its resorts throughout
      Summit and Eagle Counties in Colorado and in Teton County, Wyoming. The
      Company’s real estate operations include the planning, oversight, marketing,
      infrastructure improvement and development of the Company’s real property
      holdings. The real estate operations principal activities both historically
      and
      currently include (1) the development of property that in addition to generating
      real estate sales to third parties usually includes the creation of substantial
      Company retained facilities that the resort operations use to generate new
      sources of direct revenue, (2) the sale of land parcels, including improvements
      to the land made by the Company, to third party developers for condominium,
      townhome, cluster home, single family home, lodge and mixed-use developments,
      (3) the zoning, planning, development and marketing of resort communities
      including the arrangement for the construction of necessary roads, utilities
      and
      mountain infrastructure for the resort communities, including amenities for
      the
      use by the Company’s resort operations, (4) the purchase of selected strategic
      land parcels, and (5) the sale of single-family homesites, including
      improvements made by the Company, to individual purchasers.

    The
      Company’s investments in real estate have been made with significant emphasis on
      the benefits to be realized by its resort operations. While the Company develops
      real property that is sold to third parties, the fact that the Company has
      potential alternative uses for its investments in real estate for the benefit
      of
      its resort operations differentiates it from a traditional real estate
      development company. Additionally, of the Company’s current real estate
      landholdings only two purchases were made in the last several years thus
      supporting the fact that the Company does not actively acquire real estate
      for
      development and sales to third parties but rather looks for strategic
      opportunities that can benefit the Company’s resort operations. The Company
      contemplates both the sale of real estate and/or the development of resort
      depreciable assets when it acquires real property since all of its real estate
      holdings are proximate to its resorts. In fact, the predominant activity of
      the
      Company’s current development efforts include mixed-use development projects
      that includes condominiums to be sold to third parties, as well as hotels,
      private clubs, spas, commercial lease space and skier services facilities all
      to
      be owned and operated by the Company. Therefore, it is difficult (as further
      explained below) to separate the majority of the Company’s investments made (at
      the time of making these investments) that is expected to be sold to third
      parties. Additionally, because of the mixed-use nature of the Company’s
      development projects it is required at the close of a project to determine
      the
      project costs that will be recorded as real estate cost of sales and resort
      depreciable assets using the relative sales value method as prescribed by SFAS
      67. Due to the complexities of this calculation the Company uses the assistance
      of outside appraisal experts to determine each of these components, so to
      attempt to allocate project costs as they are incurred would be subjective
      and
      arbitrary. Thus applying the principles of paragraph 25 of SFAS 102 becomes
      extremely difficult in concluding whether an investment is an “investing cash
      outflow” or an “operating cash outflow”. For example, The Arrabelle at Vail
      Square development project, currently under construction, consists of one
      building that contains condominiums that will be sold to third parties, a luxury
      hotel, private club, spa, commercial space, parking garage and skier services
      facilities. Thus it is difficult to determine whether the components of the
      project such as HVAC systems, walls, roof, land and many other common costs
      should be assigned to real estate for development and sale versus resort assets
      to be owned and operated as specific identification of cost is not feasible
      with
      substantially all costs being of common nature. Additionally, due to the
      disparate nature of the components of this project the Company is prohibited
      under SFAS 67 from using a simple allocation methodology such as square footage,
      as the resultant answer would be substantially different from the relative
      sales
      value method of allocation. Furthermore, The Arrabelle at Vail Square was a
      project that evolved over several years that entailed a significant amount
      of
      planning, zoning, design and other similar costs being incurred before the
      final
      decision was made as to how the land would be used which included several
      reiterations of resort and real estate usage, thus further complicating the
      ability to make an accurate allocation of costs between the real estate and
      resort components at the time the costs are incurred. Consequently, the Company
      has relied, in large part, on paragraph 24 of SFAS 95 to determine the
      appropriate classification of its investments within its statements of cash
      flows, of which determination only considered the direct cash flows from real
      estate sales compared to the direct cash flows from those assets (as stated
      above) that would be owned and operated upon the completion of the project,
      and
      did not include cash flows that could not be measurable or supportable.
      Furthermore, it is not the intent of the Company to hold its real estate for
      a
      short period of time and then sell it (which paragraph 24 of SFAS 95 states
      should be an operating activity) as evidenced by the fact that the vast majority
      of the Company’s real estate land holdings currently held were acquired ten or
      more years ago.

    Additionally,
      the Company believes that it has been transparent in its disclosures within
      its
      statements of cash flows by including in a separate line item within its
      operating activity, “non-cash real estate cost of sales”, which represents
      actual outflows from real estate investments made inclusive of prior periods
      within the period that the cost of sales is recorded. The Company has also
      reflected within its operating activities the ongoing operations of its
      wholly-owned subsidiary, Vail Resorts Development Company, which has a
      substantial infrastructure (including work force) to support its real estate
      operations, including the marketing of real estate investments once the decision
      is made to market such investments and to oversee its vertical development.
      Consequently, since the Company has: 1) held its real estate holdings for many
      years; 2) at the time of its initial investment it does not know the ultimate
      use of its land acquisitions; 3) its development efforts include a significant
      amount of mixed-use vertical development projects; 4) has been transparent
      in
      its disclosures within its statements of cash flow; and 5) has recorded its
      Real
      Estate Held for Sale and Investments as a long-term asset on its balance sheet,
      it has historically concluded that it was appropriate to reflect its investments
      in real estate as an investing cash outflow which has been disclosed as a
      separate line item apart from its other capital expenditures. Additionally,
      due
      to the extended cycle between the initial cash outflow for investments in real
      estate and the inflow from revenues generated from real estate sales (several
      years in many cases), the Company has classified its real estate investments
      as
      a long-term asset and its related outflows as an investing activity as the
      majority of the Company’s cash outflows and inflows from operating activities
      occur in a one-year or less operating cycle which are primarily driven by its
      more significant resort operations.

    The
      above
      conclusion is also supported by the principles as set forth in paragraph 54
      of
      Concept Statement No. 5 and as further noted by a member of the Financial
      Accounting Standards Board in SFAS 95 in that the statements of cash flows
      should present few recognition problems because all cash receipts and payments
      are recognized when they occur and involves no issues of recognition,
      measurement, or estimation, which otherwise would arise if the Company were
      to
      attempt to allocate costs at the inception of a project or acquisition of
      landholdin