As with previous entries in the series, Colin McRae Rally 2005 presents a realistic rally simulation. Players work through 70 stages spread across nine countries. Over 30 cars are available to drive. The game features a revised graphics and damage engine that enables visible paint scratches on bodywork, along with enhanced breakage effects including broken glass and doors falling off during impacts. A blurred vision effect activates when the player collides with a hard object. The damage model carries practical consequences: a damaged radiator causes the engine to stall, requiring a restart.
Two primary modes structure the experience. In career mode, the player starts in lower club leagues and progresses upward to eventually compete against Colin McRae in his 2004 Dakar Rally Nissan pick-up. In championship mode, the player takes the role of McRae himself, competing in six rallies using any four-wheel-drive car. A limited cosmetic customisation option allows players to display their own name and nationality on the car window.
Online multiplayer was available on both PlayStation 2 and Xbox at launch. Xbox Live support continued until 15 April 2010, after which online play on Xbox became accessible again through the Insignia replacement server service.
A Mac OS X port, renamed Colin McRae Rally Mac to distinguish it from the year-branded PC version, was developed by Robosoft Technologies and published by Feral Interactive. It was released on 26 October 2007 — just six weeks after Colin McRae's death in a helicopter crash. The Mac port faced a protracted development due to Apple's transition to Intel hardware and internal changes at Feral, resulting in a delay of several years from the original PC release.
A PlayStation Portable version was released in Japan under the title Colin McRae Rally, published by Interchannel-Holon on 14 June 2007.
Two mobile versions were also produced: an N-Gage adaptation developed by Ideaworks3D, which reused stages from Colin McRae Rally 2.0, and a J2ME version developed by IOMO and published by Digital Bridges. Both mobile versions received BAFTA nominations in the Mobile and Handheld categories.
Colin McRae Rally 2005 received favorable reviews on all platforms except the PSP version, which drew average assessments, according to Metacritic. GameSpot named it the best N-Gage game of 2004. Across all platforms, it placed as a runner-up in GameSpot's annual Best Driving Game award category, behind Burnout 3: Takedown.
Macworld editor Peter Cohen awarded the Mac OS X port four out of five stars, praising the variety of vehicles, courses, and game modes alongside graphics and sound effects described as "top notch." Minor criticism was directed at the online play implementation.
Colin McRae Rally 2005 appeared during a period when Codemasters was refining the formula established by earlier entries in the series. The game's expanded damage model and revised career structure represented iterative improvements over its predecessors, while the multi-platform reach — extending to mobile and handheld alongside the main console and PC releases — reflected the breadth of the franchise at its commercial peak in the mid-2000s.