The S3's 261bhp 2.0-litre engine feels a little hesitant at low revs, but it delivers a formidable shove in the back when the turbo wakes up and relentless acceleration thereafter. Hike up the revs, drop the clutch and the S3 will sprint from 0 to 62mph in just 5.7 seconds - almost half a second quicker than its main rival, the BMW 130i.

Traction is hard to fault, thanks to a four-wheel-drive system that shuffles power between the front and rear wheels as needed, while the S3's lowered and stiffened sports suspension provides excellent body control. Unfortunately, overly light steering and an uncompromising ride that jostles occupants in their seats let the side down.

The turbocharged engine emits a suitably sporty rasp if worked hard, but it's rather boomy when cruising at motorway speeds, so long journeys can be tiring. As in lesser A3s, there's little wind noise at the national limit, but some road noise does find its way into the cabin.

There's no getting away from it: the S3 is a very pricey hot hatch. Some rivals offering similar performance - but a less prestigious badge - undercut it by over £7000. Average fuel consumption of 33.2mpg and a group 18 insurance rating are par for the course, but residuals aren't as strong as you might expect for an Audi.

Audi cabins have a reputation for quality, and the S3 doesn't appear to let the side down. Everything you touch feels built to last, and it's beautifully finished, mixing dense soft-touch plastics with a generous helping of metallic trim. Audi's reliability record is less impressive, but the standard A3 has a good customer satisfaction rating.

The list of standard safety kit includes twin front, side and curtain airbags, anti-whiplash front head restraints and stability control. Security provisions are equally comprehensive, with deadlocks, an alarm, a secure stereo and plenty of marked parts.

As in all A3s, the steering wheel moves for both height and reach, and the S3's heavily bolstered sports seats offer a wide range of adjustment. However, taller drivers may find that the strut on the centre console digs into their left knee. The controls for the stereo and heater are mostly logical, but the display can be tricky to read at night when everything is lit in the same red hue.

The three-door S3 offers loads of space for the driver and front passenger, but those over six feet tall won't relish long journeys in the back. The boot is a good size and shape with the seats in place, but folding the rear seat backs down leaves a stepped load platform. The five-door Sportback is spacious for four occupants and has a larger boot than the three-door model.

Standard equipment includes 18-inch alloy wheels, xenon headlights, part-leather upholstery, climate control, and an MP3-compatible CD player, but luxuries such as parking sensors, electric seat adjustment and a CD multichanger cost extra. That's disappointing given the S3's hefty price tag.