| T | Quarterly      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of      1934 |
|---|---------------------------------------------------------------------------------------------------|

| £ | Transition      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of      1934 |
|--------|----------------------------------------------------------------------------------------------------|

| Minnesota                                                           |   | 41-0418150                             |
|---------------------------------------------------------------------|--------|----------------------------------------|
| (State      or other jurisdiction of incorporation or organization) |   | (IRS      Employer Identification No.) |

| Large      Accelerated Filer T    | Accelerated      Filer £              |
|-----------------------------------|--------------------------------------------|
| Non-Accelerated      Filer £ | Smaller      Reporting Company £ |

----

|                                                                                       |                                          |                                                                                            | Page   |
|--------------------------------------------------------------------------------------------|-----------------------------------------------|-------------------------------------------------------------------------------------------------|--------|
|                                                                                       |                                          |                                                                                            |   |
| Definitions                                                                                |                                          |                                                                                            | 3      |
|                                                                                       |                                          |                                                                                            |   |
| Safe Harbor Statement Under the Private      Securities Litigation Reform Act of 1995 | 5                                             |
|                                                                                       |                                          |                                                                                            |   |
| Part I.                                                                                    | Financial Information                         |                                                                                            |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Item 1.                                       | Financial Statements                                                                            |   |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Consolidated Balance Sheet -                  |                                                                                            |
|                                                                                       |                                          | March 31, 2009 and December 31, 2008                                                            | 6      |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Consolidated Statement of Income -            |                                                                                            |
|                                                                                       |                                          | Quarter Ended March 31, 2009 and 2008                                                           | 7      |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Consolidated Statement of Cash Flows -        |                                                                                            |
|                                                                                       |                                          | Quarter Ended March 31, 2009 and 2008                                                           | 8      |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Notes to Consolidated Financial    Statements | 9                                                                                               |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Item 2.                                       | Management’s Discussion and Analysis of Financial      Conditionand Results of Operations | 22     |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Item 3.                                       | Quantitative and Qualitative Disclosures about Market      Risk                                 | 33     |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Item 4.                                       | Controls and Procedures                                                                         | 34     |
|                                                                                       |                                          |                                                                                            |   |
| Part II.                                                                                   | Other Information                             |                                                                                            |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Item 1.                                       | Legal Proceedings                                                                               | 34     |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Item 1A.                                      | Risk Factors                                                                                    | 34     |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Item 2.                                       | Unregistered Sales of Equity Securities and Use of      Proceeds                                | 34     |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Item 3.                                       | Defaults Upon Senior Securities                                                                 | 34     |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Item 4.                                       | Submission of Matters to a Vote of Security      Holders                                        | 34     |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Item 5.                                       | Other Information                                                                               | 35     |
|                                                                                       |                                          |                                                                                            |   |
|                                                                                       | Item 6.                                       | Exhibits                                                                                        | 36     |
|                                                                                       |                                          |                                                                                            |   |
| Signatures                                                                                 |                                          |                                                                                            | 37     |

----

Definitions

| Abbreviation      or Acronym | Term                                                                                                                                                                                             |
|------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| AFUDC                        | Allowance      for Funds Used During Construction – consisting of the cost of both the      debt and equity funds used to finance utility plant additions during      construction periods |
| ALLETE                       | ALLETE,      Inc.                                                                                                                                                                                |
| ALLETE      Properties       | ALLETE      Properties, LLC and its subsidiaries                                                                                                                                                 |
| APB                          | Accounting      Principles Board                                                                                                                                                                 |
| AREA                         | Arrowhead      Regional Emission Abatement                                                                                                                                                       |
| ARS                          | Auction      Rate Securities                                                                                                                                                                     |
| ATC                          | American      Transmission Company LLC                                                                                                                                                           |
| BNI      Coal                | BNI      Coal, Ltd.                                                                                                                                                                              |
| BNSF                         | BNSF      Railway Company                                                                                                                                                                        |
| Boswell                      | Boswell      Energy Center                                                                                                                                                                       |
| Company                      | ALLETE,      Inc. and its subsidiaries                                                                                                                                                           |
| DC                           | Direct      Current                                                                                                                                                                              |
| EITF                         | Emerging      Issues Task Force                                                                                                                                                                  |
| EPA                          | Environmental      Protection Agency                                                                                                                                                             |
| ESOP                         | Employee      Stock Ownership Plan                                                                                                                                                               |
| FASB                         | Financial      Accounting Standards Board                                                                                                                                                        |
| FERC                         | Federal      Energy Regulatory Commission                                                                                                                                                        |
| Form      10-K               | ALLETE      Annual Report on Form 10-K                                                                                                                                                           |
| Form      10-Q               | ALLETE      Quarterly Report on Form 10-Q                                                                                                                                                        |
| FSP                          | FASB      Staff Position                                                                                                                                                                         |
| GAAP                         | United      States Generally Accepted Accounting Principles                                                                                                                                      |
| GHG                          | Greenhouse      Gases                                                                                                                                                                            |
| IBEW      Local 31           | International      Brotherhood of Electrical Workers Local 31                                                                                                                                    |
| Invest      Direct           | ALLETE’s      Direct Stock Purchase and Dividend Reinvestment Plan                                                                                                                         |
| kV                           | Kilovolt(s)                                                                                                                                                                                      |
| Laskin                       | Laskin      Energy Center                                                                                                                                                                        |
| Minnesota      Power         | An      operating division of ALLETE, Inc.                                                                                                                                                       |
| Minnkota      Power          | Minnkota      Power Cooperative, Inc.                                                                                                                                                            |
| MISO                         | Midwest      Independent Transmission System Operator, Inc.                                                                                                                                      |
| MPCA                         | Minnesota      Pollution Control Agency                                                                                                                                                          |
| MPUC                         | Minnesota      Public Utilities Commission                                                                                                                                                       |
| MW      / MWh                | Megawatt(s)      / Megawatt-hour(s)                                                                                                                                                              |
| Non-residential              | Retail      commercial, non-retail commercial, office, industrial, warehouse, storage      and institutional                                                                                     |
| NOX                          | Nitrogen      Oxide                                                                                                                                                                              |
| Note      ___                | Note      ___ to the consolidated financial statements in this Form    10-Q                                                                                                                      |
| Oliver      Wind I           | Oliver      Wind I Energy Center                                                                                                                                                                 |
| Oliver      Wind II          | Oliver      Wind II Energy Center                                                                                                                                                                |

----

| Definitions      (Continued)  |
|-------------------------------|
| Abbreviation      or Acronym  | Term |
| Palm      Coast Park          | Palm      Coast Park development project in Florida |
| Palm      Coast Park District | Palm      Coast Park Community Development District |
| PSCW                          | Public      Service Commission of Wisconsin |
| Rainy      River Energy       | Rainy      River Energy Corporation - Wisconsin |
| SEC                           | Securities      and Exchange Commission |
| SFAS                          | Statement      of Financial Accounting Standards No. |
| SO2                           | Sulfur      Dioxide |
| Square      Butte             | Square      Butte Electric Cooperative |
| SWL&P                     | Superior      Water, Light and Power Company |
| Taconite      Harbor          | Taconite      Harbor Energy Center |
| Town      Center              | Town      Center at Palm Coast development project in Florida |
| Town      Center District     | Town      Center at Palm Coast Community Development District |
| WDNR                          | Wisconsin      Department of NaturalResources |

----

Harbor 

| · | our      ability to successfully implement our strategic  objectives;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| · | our      ability to manage expansion and integrate acquisitions;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| · | prevailing      governmental policies, regulatory actions, and legislation including those      of the United States Congress, state legislatures, the FERC, the MPUC, the      PSCW, and various local and county regulators, and city administrators,      about allowed rates of return, financings, industry and rate structure,      acquisition and disposal of assets and facilities, real estate      development, operation and construction of plant facilities, recovery of      purchased power, capital investments and other expenses, present or      prospective wholesale and retail competition (including but not limited to      transmission costs), zoning and permitting of land held for resale and      environmental matters; |
| · | the      potential impacts of climate change and future regulation to restrict the      emissions of GHG on our Regulated Operations;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| · | effects      of restructuring initiatives in the electric industry;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| · | economic      and geographic factors, including political and economic      risks;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| · | changes      in and compliance with laws and regulations;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| · | weather      conditions;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| · | natural      disasters and pandemic diseases;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| · | war      and acts of terrorism;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| · | wholesale      power market conditions;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| · | population      growth rates and demographic patterns;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| · | effects      of competition, including competition for retail and wholesale      customers;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| · | changes      in the real estate market;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| · | pricing      and transportation of commodities;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| · | changes      in tax rates or policies or in rates of inflation;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| · | project      delays or changes in project costs;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| · | availability      and management of construction      materials and skilled construction labor for capital    projects;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| · | changes      in operating expenses, capital and land      development expenditures;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| · | global      and domestic economic conditions affecting us or our      customers;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| · | our      ability to access capital markets and bank financing;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| · | changes      in interest rates and the performance of the financial      markets;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| · | our      ability to replace a mature workforce and retain qualified, skilled and      experienced personnel; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| · | the      outcome of legal and administrative proceedings (whether civil or      criminal) and settlements that affect the business and profitability of      ALLETE.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |

----

|   | PART I.  FINANCIAL  INFORMATION |
|--------|-------------------------------------------|

|   | ITEM      1.  FINANCIAL STATEMENTS |
|--------|----------------------------------------------|

ALLETE

|                                                                          |                                                               |                                |          March      31, |          December      31, |
|-------------------------------------------------------------------------------|--------------------------------------------------------------------|-------------------------------------|----------------------------------------------------------------------|-------------------------------------------------------------------------|
|                                                                          |                                                               |                                |         2009                 |         2008                    |
|                                                                          |                                                               |                                |                                                                 |                                                                    |
| Assets                                                                        |                                                               |                                |                                                                 |
| Current      Assets                                                           |                                                               |                                |
|                                                                          | Cash      and Cash Equivalents                                     | $98.0                               | $102.0                                                               |
|                                                                          | Accounts      Receivable (Less Allowance of $0.7 at March 31, 2009 |                                |                                                                 |
|                                                                          |                                                               | and      $0.7 at December 31, 2008) | 76.4                                                                 | 76.3                                                                    |
|                                                                          | Inventories                                                        | 49.8                                | 49.7                                                                 |
|                                                                          | Prepayments      and Other                                         | 19.7                                | 24.3                                                                 |
|                                                                          |                                                               | Total      Current Assets           | 243.9                                                                | 252.3                                                                   |
| Property,      Plant and Equipment - Net                                      | 1,435.2                                                            | 1,387.3                             |
| Investment      in ATC                                                        | 79.7                                                               | 76.9                                |
| Other      Investments                                                        | 127.3                                                              | 136.9                               |
| Other      Assets                                                             | 282.8                                                              | 281.4                               |
| Total      Assets                                                             | $2,168.9                                                           | $2,134.8                            |
|                                                                          |                                                               |                                |                                                                 |                                                                    |
| Liabilities      and Equity                                                   |                                                               |                                |
| Liabilities                                                                   |                                                               |                                |
| Current      Liabilities                                                      |                                                               |                                |
|                                                                          | Accounts      Payable                                              | $51.9                               | $75.7                                                                |
|                                                                          | Accrued      Taxes                                                 | 17.7                                | 12.9                                                                 |
|                                                                          | Accrued      Interest                                              | 10.0                                | 8.9                                                                  |
|                                                                          | Long-Term      Debt Due Within One Year                            | 14.0                                | 10.4                                                                 |
|                                                                          | Notes      Payable                                                 | 6.0                                 | 6.0                                                                  |
|                                                                          | Other                                                              | 37.7                                | 36.8                                                                 |
|                                                                          |                                                               | Total      Current Liabilities      | 137.3                                                                | 150.7                                                                   |
| Long-Term      Debt                                                           | 627.1                                                              | 588.3                               |
| Deferred      Income Taxes                                                    | 182.2                                                              | 169.6                               |
| Other      Liabilities                                                        | 363.9                                                              | 389.3                               |
|                                                                          | Total      Liabilities                                             | 1,310.5                             | 1,297.9                                                              |
|                                                                          |                                                               |                                |                                                                 |                                                                    |
| Commitments      and Contingencies (Note 13)                                  |                                                               |                                |
|                                                                          |                                                               |                                |                                                                 |                                                                    |
| Equity                                                                        |                                                               |                                |
| ALLETE’s      Equity                                                    |                                                               |                                |
| Common      Stock Without Par Value, 43.3 Shares Authorized, 33.2 and    32.6 |                                                               |                                |
|                                                                          | Shares      Outstanding                                            | 549.5                               | 534.1                                                                |
| Unearned      ESOP Shares                                                     | (51.3)                                                             | (54.9)                              |
| Accumulated      Other Comprehensive Loss                                     | (33.6)                                                             | (33.0)                              |
| Retained      Earnings                                                        | 384.1                                                              | 380.9                               |
|                                                                          | Total      ALLETE’s Equity                                   | 848.7                               | 827.1                                                                |
| Non-Controlling      Interest in Subsidiaries                                 | 9.7                                                                | 9.8                                 |
|                                                                          | Total      Equity                                                  | 858.4                               | 836.9                                                                |
| Total      Liabilities and Equity                                             | $2,168.9                                                           | $2,134.8                            |

The accompanying notes are an integralpart of these statements.

----

ALLETE

|                                                      |                           |                              | Quarter      Ended |
|-----------------------------------------------------------|--------------------------------|-----------------------------------|--------------------|
|                                                      |                           |                              | March      31,     |
|                                                      |                           |                              | 2009               | 2008 |
|                                                      |                           |                              |               |   |
| Operating      Revenue                                    |                           |                              |
|                                                      | Operating      Revenue         | $204.9                            | $213.4             |
|                                                      | Prior      Year Rate Refunds   | (5.3)                             | –            |
|                                                      |                           | Total      Operating Revenue      | 199.6              | 213.4 |
|                                                      |                           |                              |               |   |
| Operating      Expenses                                   |                           |                              |
|                                                      | Fuel      and Purchased Power  | 72.8                              | 86.3               |
|                                                      | Operating      and Maintenance | 80.5                              | 83.1               |
|                                                      | Depreciation                   | 15.2                              | 12.7               |
|                                                      |                           | Total      Operating Expenses     | 168.5              | 182.1 |
|                                                      |                           |                              |               |   |
| Operating      Income                                     | 31.1                           | 31.3                              |
|                                                      |                           |                              |               |   |
| Other      Income (Expense)                               |                           |                              |
|                                                      | Interest      Expense          | (8.7)                             | (6.0)              |
|                                                      | Equity      Earnings in ATC    | 4.2                               | 3.4                |
|                                                      | Other                          | 1.1                               | 8.6                |
|                                                      |                           | Total      Other Income (Expense) | (3.4)              | 6.0 |
|                                                      |                           |                              |               |   |
| Income      Before Income Taxes                           | 27.7                           | 37.3                              |
| Income      Tax Expense                                   | 10.8                           | 13.7                              |
| Net      Income                                           | $16.9                          | $23.6                             |
|                                                      |                           |                              |               |   |
| Average      Shares of Common Stock                       |                           |                              |
|                                                      | Basic                          | 30.9                              | 28.7               |
|                                                      | Diluted                        | 31.0                              | 28.7               |
|                                                      |                           |                              |
| Basic      and Diluted Earnings Per Share of Common Stock | $0.55                          | $0.82                             |
|                                                      |                           |                              |               |   |
| Dividends      Per Share of Common Stock                  | $0.44                          | $0.43                             |

----

ALLETE

|                                                  | Quarter      Ended                                           |
|-------------------------------------------------------|--------------------------------------------------------------|
|                                                  | March      31,                                               |
|                                                  |                                                         |   | 2009 | 2008 |
|                                                  |                                                         |   |   |   |
| Operating      Activities                             |                                                         |   |
|                                                  | Net      Income                                              | $16.9 | $23.6 |
|                                                  | Allowance      for Funds Used During Construction            | (1.3) | (1.0) |
|                                                  | Loss      (Income) from Equity Investments, Net of Dividends | 0.3 | (0.4) |
|                                                  | Gain      on Sale of Available-for-Sale Securities           | – | (6.5) |
|                                                  | Depreciation      and Amortization                           | 15.4 | 12.9 |
|                                                  | Deferred      Income Tax Expense                             | 10.5 | 6.1 |
|                                                  | Stock      Compensation Expense                              | 0.6 | 0.6 |
|                                                  | Bad      Debt Expense                                        | 0.3 | 0.2 |
|                                                  | Changes      in Operating Assets and Liabilities             |   |   |
|                                                  |                                                         | Accounts      Receivable | (0.3) | 9.2 |
|                                                  |                                                         | Inventories | (0.1) | (0.2) |
|                                                  |                                                         | Prepayments      and Other | 4.5 | 9.5 |
|                                                  |                                                         | Accounts      Payable | (10.0) | (14.6) |
|                                                  |                                                         | Other      Current Liabilities | 6.9 | 10.3 |
|                                                  | Other      Assets                                            | (1.2) | 0.5 |
|                                                  | Other      Liabilities                                       | (8.0) | 4.7 |
|                                                  |                                                         | Cash      from Operating Activities | 34.5 | 54.9 |
|                                                  |                                                         |   |   |   |
| Investing      Activities                             |                                                         |   |
|                                                  | Proceeds      from Sale of Available-for-Sale Securities     | 0.9 | 45.6 |
|                                                  | Payments      for Purchase of Available-for-Sale Securities  | (0.2) | (42.9) |
|                                                  | Investment      in ATC                                       | (1.9) | – |
|                                                  | Changes      to Other Investments                            | 6.4 | 6.9 |
|                                                  | Additions      to Property, Plant and Equipment              | (74.6) | (59.6) |
|                                                  | Other                                                        | (0.2) | (0.2) |
|                                                  |                                                         | Cash      for Investing Activities | (69.6) | (50.2) |
|                                                  |                                                         |   |   |   |
| Financing      Activities                             |                                                         |   |
|                                                  | Proceeds      from Issuance of Common Stock                  | 2.8 | 1.1 |
|                                                  | Proceeds      from Issuance of Long-Term Debt                | 42.9 | 61.0 |
|                                                  | Reductions      of Long-Term Debt                            | (0.5) | (0.6) |
|                                                  | Debt      Issuance Costs                                     | (0.5) | (0.5) |
|                                                  | Dividends      on Common Stock                               | (13.6) | (12.8) |
|                                                  |                                                         | Cash      from Financing Activities | 31.1 | 48.2 |
|                                                  |                                                         |   |   |   |
| Change      in Cash and Cash Equivalents              | (4.0)                                                        | 52.9 |
| Cash      and Cash Equivalents at Beginning of Period | 102.0                                                        | 23.3 |
|                                                  |                                                         |   |   |   |
| Cash      and Cash Equivalents at End of Period       | $98.0                                                        | $76.2 |

----

NOTES 

|                        | March      31, | December      31, |
|-----------------------------|----------------|-------------------|
| Inventories                 | 2009           | 2008              |
| Millions                    |           |              |
|                        |           |              |
| Fuel                        | $16.6          | $16.6             |
| Materials      and Supplies | 33.2           | 33.1              |
|                        |           |              |
| Total      Inventories      | $49.8          | $49.7             |

|                         | March      31, | December      31, |
|------------------------------|----------------|-------------------|
| Other      Liabilities       | 2009           | 2008              |
| Millions                     |           |              |
|                         |           |              |
| Pension      Liability       | $146.4         | $165.2            |
| Other                        | 217.5          | 224.1             |
|                         |           |              |
| Total      Other Liabilities | $363.9         | $389.3            |

| For      the Quarter Ended March 31,                                                       | 2009    | 2008    |
|--------------------------------------------------------------------------------------------|---------|---------|
| Millions                                                                                   |    |    |
|                                                                                       |    |    |
| Cash      Paid During the Period for                                                       |    |    |
| Interest      – Net of Amounts Capitalized                                           | $7.3    | $8.7    |
| Income      Taxes                                                                          | $0.6    | $0.6    |
|                                                                                       |    |    |
| Noncash      Investing and Financing Activities                                            |    |    |
| Change      in Accounts Payable for Capital Additions to Property Plant and      Equipment | $(13.8) | $(0.2)  |
| ALLETE      Common Stock contributed to the Pension Plan                                   | $(12.0) | – |

----

----

|                                           |             Regulated    |             Investments |
|------------------------------------------------|--------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------|
|                                           |             Consolidated |             Operations  |             and      Other |
| Millions                                       |                                                                                 |                                                                                |   |
| For      the Quarter Ended March 31, 2009      |                                                                                 |                                                                                |   |
| Operating      Revenue                         | $204.9                                                                               | $186.4                                                                              | $18.5 |
| Prior      Year Rate Refunds                   | (5.3)                                                                                | (5.3)                                                                               | – |
| Total      Operating Revenue                   | 199.6                                                                                | 181.1                                                                               | 18.5 |
| Fuel      and Purchased Power                  | 72.8                                                                                 | 72.8                                                                                | – |
| Operating      and Maintenance                 | 80.5                                                                                 | 62.8                                                                                | 17.7 |
| Depreciation      Expense                      | 15.2                                                                                 | 14.1                                                                                | 1.1 |
| Operating      Income (Loss)                   | 31.1                                                                                 | 31.4                                                                                | (0.3) |
| Interest      Expense                          | (8.7)                                                                                | (7.3)                                                                               | (1.4) |
| Equity      Earnings in ATC                    | 4.2                                                                                  | 4.2                                                                                 | – |
| Other      Income (Loss)                       | 1.1                                                                                  | 1.2                                                                                 | (0.1) |
| Income      (Loss) Before Income Taxes         | 27.7                                                                                 | 29.5                                                                                | (1.8) |
| Income      Tax Expense (Benefit)              | 10.8                                                                                 | 11.8                                                                                | (1.0) |
| Net      Income (Loss)                         | $16.9                                                                                | $17.7                                                                               | $(0.8) |
|                                           |                                                                                 |                                                                                |   |
| As      of March 31, 2009                      |                                                                                 |                                                                                |   |
| Total      Assets                              | $2,168.9                                                                             | $1,872.5                                                                            | $296.4 |
| Property,      Plant and Equipment – Net | $1,435.2                                                                             | $1,381.9                                                                            | $53.3 |
| Accumulated      Depreciation                  | $867.1                                                                               | $817.6                                                                              | $49.5 |
| Capital      Additions                         | $61.7                                                                                | $60.8                                                                               | $0.9 |

----

|                                           |             Regulated    |             Investments |
|------------------------------------------------|--------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------|
|                                           |             Consolidated |             Operations  |             and      Other |
| Millions                                       |                                                                                 |                                                                                |   |
| For      the Quarter Ended March 31, 2008      |                                                                                 |                                                                                |   |
| Operating      Revenue                         | $213.4                                                                               | $193.3                                                                              | $20.1 |
| Fuel      and Purchased Power                  | 86.3                                                                                 | 86.3                                                                                | – |
| Operating      and Maintenance                 | 83.1                                                                                 | 62.5                                                                                | 20.6 |
| Depreciation      Expense                      | 12.7                                                                                 | 11.5                                                                                | 1.2 |
| Operating      Income (Loss)                   | 31.3                                                                                 | 33.0                                                                                | (1.7) |
| Interest      Expense                          | (6.0)                                                                                | (5.8)                                                                               | (0.2) |
| Equity      Earnings in ATC                    | 3.4                                                                                  | 3.4                                                                                 | – |
| Other      Income                              | 8.6                                                                                  | 1.1                                                                                 | 7.5 |
| Income      Before Income Taxes                | 37.3                                                                                 | 31.7                                                                                | 5.6 |
| Income      Tax Expense                        | 13.7                                                                                 | 11.6                                                                                | 2.1 |
| Net      Income                                | $23.6                                                                                | $20.1                                                                               | $3.5 |
|                                           |                                                                                 |                                                                                |   |
| As      of March 31, 2008                      |                                                                                 |                                                                                |   |
| Total      Assets                              | $1,715.8                                                                             | $1,419.8                                                                            | $296.0 |
| Property,      Plant and Equipment – Net | $1,153.1                                                                             | $1,099.3                                                                            | $53.8 |
| Accumulated      Depreciation                  | $850.8                                                                               | $804.8                                                                              | $46.0 |
| Capital      Additions                         | $60.3                                                                                | $58.0                                                                               | $2.3 |

|                                 | March      31, | December      31, |
|--------------------------------------|----------------|-------------------|
| Investments                          | 2009           | 2008              |
| Millions                             |           |              |
| ALLETE      Properties               | $85.1          | $84.9             |
| Available-for-Sale      Securities   | 30.6           | 32.6              |
| Emerging      Technology Investments | 6.2            | 7.4               |
| Other                                | 5.4            | 12.0              |
| Total      Investments               | $127.3         | $136.9            |

|                                                    | March 31, | December      31, |
|---------------------------------------------------------|-----------|-------------------|
| ALLETE      Properties                                  | 2009      | 2008              |
| Millions                                                |      |              |
|                                                    |      |              |
| Land      Held for Sale Beginning Balance               | $71.2     | $62.6             |
| Additions      During Period: Capitalized Improvements  | 0.9       | 10.5              |
| Deductions      During Period: Cost of Real Estate Sold | (0.6)     | (1.9)             |
| Land      Held for Sale Ending Balance                  | 71.5      | 71.2              |
| Long-Term      Finance Receivables                      | 13.5      | 13.6              |
| Other                                                   | 0.1       | 0.1               |
| Total      Real Estate Assets                           | $85.1     | $84.9             |

----

----

|                                              | Fair      Value as of March 31, 2009 |
|---------------------------------------------------|--------------------------------------|
| Recurring Fair Value      Measures                | Level      1                         | Level      2 | Level      3 | Total |
| Millions                                          |                                 |   |   |   |
| Assets:                                           |                                 |   |   |   |
| Mutual      Funds                                 | $11.9                                | – | – | $11.9 |
| Bonds                                             | –                              | $3.5 | – | 3.5 |
| Derivatives                                       | 0.2                                  | 0.3 | – | 0.5 |
| Auction      Rate Securities                      | –                              | – | $14.3 | 14.3 |
| Money      Market Funds                           | 4.3                                  | – | – | 4.3 |
| Total      Fair Value of Assets                   | $16.4                                | $3.8 | $14.3 | $34.5 |
|                                              |                                 |   |   |   |
| Liabilities:                                      |                                 |   |   |   |
| Deferred      Compensation Obligation             | –                              | $13.3 | – | $13.3 |
| Total      Fair Value of Liabilities              | –                              | $13.3 | – | $13.3 |
| Total      Net Fair Value of Assets (Liabilities) | $16.4                                | $(9.5) | $14.3 | $21.2 |

----

|                                              | Fair      Value as of December 31, 2008 |
|---------------------------------------------------|-----------------------------------------|
| Recurring Fair Value      Measures                | Level      1                            | Level      2 | Level      3 | Total |
| Millions                                          |                                    |   |   |   |
| Assets:                                           |                                    |   |   |   |
| Mutual      Funds                                 | $13.5                                   | – | – | $13.5 |
| Bonds                                             | –                                 | $3.3 | – | 3.3 |
| Auction      Rate Securities                      | –                                 | – | $15.2 | 15.2 |
| Money      Market Funds                           | 10.6                                    | – | – | 10.6 |
| Total      Fair Value of Assets                   | $24.1                                   | $3.3 | $15.2 | $42.6 |
|                                              |                                    |   |   |   |
| Liabilities:                                      |                                    |   |   |   |
| Deferred      Compensation Obligation             | –                                 | $13.5 | – | $13.5 |
| Total      Fair Value of Liabilities              | –                                 | $13.5 | – | $13.5 |
|                                              |                                    |   |   |   |
| Total      Net Fair Value of Assets (Liabilities) | $24.1                                   | $(10.2) | $15.2 | $29.1 |

| Recurring      Fair Value Measures                                      | Auction      Rate Securities |
|-------------------------------------------------------------------------|------------------------------|
| Activity      in Level 3                                                | 2009                         | 2008 |
| Millions                                                                |                         |   |
| Balance      as of December 31, 2008 and December 31, 2007,respectively | $15.2                        | – |
| Purchases,      Sales, Issuances and Settlements, Net                   | (0.9)                        | – |
| Level      3 Transfers In                                               | –                      | $25.2 |
| Balance      as of March 31,                                            | $14.3                        | $25.2 |

----

| ALLETE’s      Interest in ATC                    |   |
|--------------------------------------------------------|--------|
| Millions                                               |   |
| Equity      Investment Balance as of December 31, 2008 | $76.9  |
| Cash      Investments                                  | 1.9    |
| Equity      in ATC Earnings                            | 4.2    |
| Distributed      ATC Earnings                          | (3.3)  |
| Equity      Investment Balance as of March 31, 2009    | $79.7  |

| For      the Quarter Ended March 31,         | 2009   | 2008   |
|----------------------------------------------|--------|--------|
| Millions                                     |   |   |
| Loss      on Emerging Technology Investments | $(1.2) | $(0.5) |
| AFUDC      –    Equity                 | 1.3    | 1.0    |
| Investment      and Other Income (a)         | 1.0    | 8.1    |
| Total      Other Income                      | $1.1   | $8.6   |

| (a) | In      2008, Investment and Other Income included a gain from the sale of certain      available-for-sale securities. The gain was triggered when securities were      sold to reallocate investments to meet defined investment allocations      based upon an approved investmentstrategy. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| For      the Quarter Ended March 31, | 2009                            | 2008   |
|--------------------------------------|---------------------------------|--------|
| Millions                             |                            |   |
|                                 |                            |   |   |
| Current      Tax Expense (Benefit)   |                            |   |
|                                 | Federal                         | $(0.7) | $4.8 |
|                                 | State                           | 1.0    | 2.8 |
|                                 | Total      Current Tax Expense  | 0.3    | 7.6 |
| Deferred      Tax Expense            |                            |   |
|                                 | Federal                         | 9.3    | 5.5 |
|                                 | State                           | 1.5    | 0.9 |
|                                 | Deferred      Tax Credits       | (0.3)  | (0.3) |
|                                 | Total      Deferred Tax Expense | 10.5   | 6.1 |
| Total      Income Tax Expense        | $10.8                           | $13.7  |

| Other      Comprehensive Income              |                                                          |
|----------------------------------------------|---------------------------------------------------------------|
| Net      of Tax                              |                                                          |
| For      the Quarter Ended March 31,         | 2009                                                          | 2008 |
| Millions                                     |                                                          |   |
| Net      Income                              | $16.9                                                         | $23.6 |
| Other      Comprehensive Income              |                                                          |   |
|                                         | Unrealized      Gain (Loss) on Securities                     | (1.0) | (1.3) |
|                                         | Reclassification      Adjustment for Gains Included in Income | – | (3.8) |
|                                         | Unrealized      Gain on Derivatives                           | 0.1 | – |
|                                         | Defined      Benefit Pension and Other Postretirement Plans   | 0.3 | 0.5 |
| Total      Other Comprehensive Income (Loss) | (0.6)                                                         | (4.6) |
| Total      Comprehensive Income              | $16.3                                                         | $19.0 |

----

| Reconciliation      of Basic and Diluted |   |       |    |   |   |       |    |
|------------------------------------------|--------|------------|---------|--------|--------|------------|---------|
| Earnings      Per Share                  |   |       |    |   |   |       |    |
| For      the Quarter Ended March 31,     |   | 2009       |    |   |   | 2008       |    |
|                                     |   | Dilutive   |    |   |   | Dilutive   |    |
|                                     | Basic  | Securities | Diluted |   | Basic  | Securities | Diluted |
| Millions      Except Per Share Amounts   |   |       |    |   |   |       |    |
|                                     |   |       |    |   |   |       |    |
| Net      Income                          | $16.9  | –    | $16.9   |   | $23.6  | –    | $23.6   |
| Common      Shares                       | 30.9   | 0.1        | 31.0    |   | 28.7   | –    | 28.7    |
| Earnings      Per Share                  | $0.55  | –    | $0.55   |   | $0.82  | –    | $0.82   |

|                                            |    |                 | Postretirement |
|-------------------------------------------------|---------|----------------------|----------------|
| Components      of Net Periodic Benefit Expense | Pension | Health      and Life |
| For      the Quarter Ended March 31,            | 2009    | 2008                 | 2009           | 2008 |
| Millions                                        |    |                 |           |   |
| Service      Cost                               | $1.4    | $1.5                 | $1.0           | $1.0 |
| Interest      Cost                              | 6.5     | 6.3                  | 2.5            | 2.4 |
| Expected      Return on Plan Assets             | (8.4)   | (8.1)                | (2.1)          | (1.8) |
| Amortization      of Prior Service Costs        | 0.1     | 0.2                  | –        | – |
| Amortization      of Net Loss                   | 0.9     | 0.4                  | 0.6            | 0.4 |
| Amortization      of Transition Obligation      | – | –              | 0.7            | 0.6 |
|                                            |    |                 |           |   |
| Net      Periodic Benefit Expense               | $0.5    | $0.3                 | $2.7           | $2.6 |

----

Coal, Railand Shipping Contracts. We have three primary coalsupply agreements with various expiration dates ranging from December 2009 toDecember 2011. We also have rail and shipping agreements for the transportationof all of our coal, with various expiration dates ranging from December 2009 toJanuary 2012. Our minimum annual payment obligations under these coal, rail andshipping agreements are currently $46.6 million in 2009, $11.7 million in 2010,$7.6 million in 2011, and no specific commitments beyond 2011. Our minimumannual payment obligations will increase when annual nominations are made forcoal deliveries in future years.

----

----

----

ITEM 

----

| ·   | the      August 1, 2008 interim rate increase, net of 2009 estimated rate refunds      for retail customers in Minnesota;and |
|--------------------|------------------------------------------------------------------------------------------------------------------------------|

| ·   | FERC      approved wholesale rate increases for our municipal customers on March 1,      2008 and February 1, 2009. |
|--------------------|---------------------------------------------------------------------------------------------------------------------|

----

| Kilowatt-hours      Sold                         |                       | Quantity    | %                                |
|--------------------------------------------------|----------------------------|-------------|----------------------------------|
| Quarter      Ended March 31,                     | 2009                       | 2008        | Variance                         | Variance |
| Millions                                         |                       |        |                             |   |   |
|                                             |                       |        |                             |   |   |   |   |
| Regulated      Utility                           |                       |        |                             |   |
|                                             | Retail      and Municipals |        |                             |   |   |
|                                             |                       | Residential | 375                              | 363 | 12 | 3.3      % |
|                                             |                       | Commercial  | 379                              | 382 | (3) | (0.8)      % |
|                                             |                       | Industrial  | 1,323                            | 1,823 | (500) | (27.4)      % |
|                                             |                       | Municipals  | 265                              | 273 | (8) | (2.9)      % |
|                                             |                       |        | Total      Retail and Municipals | 2,342 | 2,841 | (499) | (17.6)      % |
|                                             | Other      Power Suppliers | 916         | 404                              | 512 | 126.7      % |
| Total      Regulated Utility Kilowatt-hours Sold | 3,258                      | 3,245       | 13                               | 0.4      % |

| ALLETE      Properties                     | 2009     | 2008   |
|--------------------------------------------|----------|--------|
| Revenue      and Sales Activity            | Quantity | Amount | Quantity | Amount |
| Dollars      in Millions                   |     |   |   |   |
|                                       |     |   |   |   |
| Revenue      from Land Sales               |     |   |   |   |
| Acres      (a)                             | 19       | $2.2   | 2 | $1.3 |
| Contract      Sales Price (b)              |     | 2.2    |   | 1.3 |
| Deferred      Revenue                      |     | (0.6)  |   | – |
| Revenue      from Land Sales               |     | 1.6    |   | 1.3 |
| Other      Revenue                         |     | 0.2    |   | 1.4 |
|  Total      ALLETE Properties Revenue |     | $1.8   |   | $2.7 |

|        (a) | Acreage      amounts are shown on a gross basis, including wetlands and non-controlling      interest. |
|-----------------|--------------------------------------------------------------------------------------------------------|

|   | (b) | Reflects      total contract sales price on closed land transactions. Land sales are      recorded using a percentage-of-completion  method. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------|

----

| COMPARISON      OF THE QUARTERS ENDED MARCH 31, 2009 AND 2008  (Continued) |
|----------------------------------------------------------------------------|

ALLETE is committed to earning a financial return that rewards ourshareholders, allows for reinvestment in our businesses and sustainsgrowth. Minnesota Power’s industrial customers are facing weak conditionsin the markets for their products, and have and may continue to reduce theamount of energy they use. We will work to sell this released energy in thewholesale markets, and believe that our ability to produce energy at low costwill be a competitive advantage. Our focus will be to maintain thecompetitively-priced production of energy, while meeting environmentalrequirements. Minnesota Power will also focus on maintaining competitiveretail rates, as we believe this is important to the success of ourcustomers.

----

----

----

OUTLOOK (Continued)

----

----

| Summary      of Development Projects    |      | Total          | Residential    | Non-residential          |
|-----------------------------------------|-----------|----------------|----------------|--------------------------|
| Land      Available-for-Sale            | Ownership | Acres      (a) | Units      (b) | Sq.      Ft. (b,      c) |
| Current      Development Projects       |      |           |           |                     |
| Town      Center                        | 80%       |           |           |                     |
| At      December 31, 2008               |      | 991            | 2,289          | 2,228,200                |
| Change      in Estimate                 |      | –        | (25)           | 40,200                   |
| At      March 31, 2009                  |      | 991            | 2,264          | 2,268,400                |
| Palm      Coast Park                    | 100%      |           |           |                     |
| At      December 31, 2008               |      | 3,436          | 3,239          | 3,116,800                |
| Change      in Estimate                 |      | –        | (85)           | 438,200                  |
| At      March 31, 2009                  |      | 3,436          | 3,154          | 3,555,000                |
| Total      Current Development Projects |      | 4,427          | 5,418          | 5,823,400                |
| Proposed      Development Project       |      |           |           |                     |
| Ormond      Crossings                   | 100%      |           |           |                     |
| At      March 31, 2009                  |      | 5,968          | (d)            | (d)                      |
|                                    |      |           |           |                     |
| Total      of Development Projects      |      | 10,395         | 5,418          | 5,823,400                |

| (a) | Acreage      amounts are approximate and shown on a gross basis, including wetlands and      non-controlling interest. |
|-----|------------------------------------------------------------------------------------------------------------------------|

| (b) | Estimated      and includes non-controlling interest. Density at build out may differ      from these estimates. |
|-----|------------------------------------------------------------------------------------------------------------------|

| (c) | Depending      on the project, non-residential includes retail commercial, non-retail      commercial, office, industrial, warehouse, storage and      institutional. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | A development order approved      by the City of Ormond Beach includes up to 3,700 residential units and 5      million square feet of non-residential space. We estimate the first two      phases of Ormond Crossings will include 2,500-3,200 residential units and      2.5-3.5 million square feet of various types of non-residential      space. Density of the residential and      non-residential components of the project will be determined based upon      market and traffic mitigation cost considerations. Approximately 2,000      acres will be devoted to a regionally significant wetlands mitigation      bank. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Other      Land Available-for-Sale (a) | Total  | Mixed      Use | Residential | Non-Residential | Agricultural |
|----------------------------------------|--------|----------------|-------------|-----------------|--------------|
| Acres      (b)                         |   |           |        |            |         |
| At      December 31, 2008              | 1,353  | 353            | 114         | 402             | 484          |
| Property      Sold                     | (19)   | –        | –     | (19)            | –      |
| At      March 31, 2009                 | 1,334  | 353            | 114         | 383             | 484          |

| (a) | Other      land includes land located in Palm Coast, Florida not included in      development projects, Lehigh Acquisition Corporation and Cape Coral      Holdings, Inc. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | Acreage      amounts are approximate and shown on a gross basis, including wetlands and      non-controlling interest. |
|-----|------------------------------------------------------------------------------------------------------------------------|

----

----

----

ITEM 

----

ITEM 

PART 

----

ITEM 

----

ITEM 

| 31(a) | Rule 13a-14(a)/15d-14(a) Certification by the Chief      Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of      2002. |
|-------|--------------------------------------------------------------------------------------------------------------------------------------------|

| 31(b) | Rule 13a-14(a)/15d-14(a) Certification by the Chief      Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of      2002. |
|-------|--------------------------------------------------------------------------------------------------------------------------------------------|

|   | 32 | Section      1350 Certification of Periodic Report by the Chief Executive Officer and      Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act      of 2002. |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 99 | ALLETE      News Release dated May 1, 2009, announcing 2009 first quarter earnings.      (This exhibit has been      furnished and shall not be deemed “filed” for purposes of Section 18      of the Securities Exchange Act of 1934, nor shall it be deemed      incorporated by reference in any filing under the Securities Act of 1933,      except as shall be expressly set forth by specific reference in such      filing.) |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | SIGNATURES |
|--------|------------|

|             |   | ALLETE,      INC.                                      |
|------------------|--------|--------------------------------------------------------|
|             |   |                                                   |
|             |   |                                                   |
|             |   |                                                   |
|             |   |                                                   |
| May      1, 2009 |   | /s/      Mark A. Schober                               |
|             |   | Mark      A. Schober                                   |
|             |   | Senior      Vice President and Chief Financial Officer |
|             |   |                                                   |
|             |   |                                                   |
|             |   |                                                   |
|             |   |                                                   |
|             |   |                                                   |
| May      1, 2009 |   | /s/      Steven Q. DeVinck                             |
|             |   | Steven      Q. DeVinck                                 |
|             |   | Controller                                             |

----