Volkswagen first entered the WRC in 1978 using different specifications of the Volkswagen Golf. The team competed intermittently through the 1980s before leaving the sport in 1990, having never challenged seriously for the manufacturers' title during this initial period.
Volkswagen entered the Dakar Rally in 2003 with Stéphane Henrard placing sixth overall in a Tarek 2WD buggy. The Race Touareg 1 followed in 2004, with Bruno Saby finishing sixth. The Race Touareg 2 brought further improvement: Giniel de Villiers finished second overall in 2006 and Mark Miller took fourth in 2007. Volkswagen won the Dakar in 2009 with de Villiers, in 2010 with Carlos Sainz, and in 2011 with Nasser Al-Attiyah, the latter campaign using the Race Touareg 3.
Volkswagen began its WRC comeback programme in 2011, testing at four events — Rally Finland, Rallye Deutschland, Rally Catalunya, and Wales Rally GB — with seven different drivers sharing the campaign. In November 2011 the team announced a multi-year contract with French driver Sébastien Ogier and co-driver Julien Ingrassia. Through 2012 Volkswagen Motorsport continued developing their Polo R World Rally Car while conducting a full WRC campaign (except New Zealand) with a pair of Škoda Fabia S2000 cars as a competitive proving exercise. Ogier delivered a notable result by becoming the first S2000 driver to record a special stage win in Sardinia and finish fifth overall — the best ever result for an S2000 in the WRC. Andreas Mikkelsen became the first S2000 driver to score Power Stage points during Rallye Deutschland. Jari-Matti Latvala and co-driver Miikka Anttila were signed in October 2012 to join Ogier for the full Polo R WRC campaign beginning in 2013.
Volkswagen entered as a fully-fledged WRC manufacturer in 2013. Sébastien Ogier and Jari-Matti Latvala were the initial entries, with Andreas Mikkelsen joining at the fourth round in Portugal and registered under a separate entry, Volkswagen Motorsport II, to allow him maximum development time with the car. The team took its first WRC victory with the Polo R WRC at Rally Sweden — their second event — when Ogier dominated the stages. Ogier continued his form through Mexico and beyond to secure the drivers' championship in their debut season. The team also won the manufacturers' title.
The pattern continued through 2014 and 2015, with Ogier claiming the drivers' championship in both years and Volkswagen retaining the manufacturers' title. In 2016 Ogier clinched his fourth consecutive drivers' championship and Volkswagen won their fourth consecutive manufacturers' title. Just days after the 2016 Wales Rally GB, Volkswagen announced their withdrawal from the WRC at the end of the season. The team had already been conducting significant development work on a new 2017-spec car when the decision was taken; it was widely attributed to the reputational and financial consequences of Volkswagen's emissions scandal, though no official reason was given.
Volkswagen Motorsport returned to the WRC in 2018 with an R5-specification version of the Polo GTI. Petter Solberg and Eric Camilli drove the car on its debut at Rally Catalunya. In November 2019, Volkswagen announced the end of all internal combustion engine-based motorsport activities, consistent with the company's broader shift toward electric vehicle manufacturing.
Volkswagen's 2013–2016 WRC campaign delivered four consecutive manufacturers' titles and four consecutive drivers' titles for Sébastien Ogier, making it statistically one of the most dominant team entries in WRC history during that period. The abrupt withdrawal at the height of the team's powers, driven by external corporate circumstances rather than any competitive decline, left a significant gap in the manufacturer field and denied the sport what had appeared to be a long-term challenger.