UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

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FORM 10-K/A
(AMENDMENT NO. 1)

|ý                                            |  | ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934.    
|-------------------------------------------- |  | -----------------------------------------------------------------------------------------
|For the fiscal year ended December 31, 2004.
|o                                            |  | TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the transition period
from                        to                
        .
Commission File No. 000-30578

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MAGNA ENTERTAINMENT CORP.(Exact name of registrant as specified in its charter)

|Delaware                                                       |  | 98-0208374                          
|-------------------------------------------------------------- |  | ------------------------------------
|(State or other jurisdiction of
incorporation or organization) |  | (I.R.S. Employer Identification No.)
|337 Magna Drive
Aurora, Ontario, Canada                        |  | L4G 7K1                             
|(Address of principal executive offices)                       |  | (Zip Code)                          

(905) 726-2462(Registrant's telephone number, including area code)

Securities
registered pursuant to Section 12(b) of the Act:None

Securities
registered pursuant to Section 12(g) of the Act:

Class A Subordinate Voting Stock(Title of class)

Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the
past 90 days. Yes ý            No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not
be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. ý

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the
Act). Yes ý            No o

As of June 30, 2004, the aggregate market value of the Class A Subordinate Voting Stock held by non-affiliates of the registrant was approximately
$232,886,782 (based on the closing sale price of $5.90 per share of Class A Subordinate Voting Stock reported on The Nasdaq National Market on June 30, 2004, the last day of the
registrant's most recently completed second quarter). As of June 30, 2004, non-affiliates held no shares of Class B Stock. There is no active market for such stock.

The
number of shares of Class A Subordinate Voting Stock of the registrant outstanding as of March 9, 2005 was 48,878,796.

The
number of shares of Class B Stock of the registrant outstanding as of March 9, 2005 was 58,466,056.

DOCUMENTS INCORPORATED BY REFERENCE

|Document |  | Part of 10-K into which incorporated
|-------- |  | ------------------------------------
|None     |  | None                                



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Explanatory Note

In November 2004, the Securities and Exchange Commission issued an exemptive order providing companies with a market capitalization under
$700 million with an extension of up to 45 days for the filing of management's report on the Company's internal controls over financial reporting and the required attestation on those
controls from our independent registered public accountants. We elected to utilize a portion of this extension period. Therefore, Magna Entertainment Corp. hereby amends its Annual Report on
Form 10-K, filed March 15, 2005 (the "Original Filing"), to include Management's Report on Internal Control Over Financial Reporting and the Report of our Independent
Registered Public Accounting Firm required in Item 9A, "Controls and Procedures" on Form 10-K. Except for the foregoing amendment, this Form 10-K/A does
not modify or update other disclosures in, or exhibits to, the Original Filing.

ITEM 9A.CONTROLS AND PROCEDURES.

Management's Report on Internal Control Over Financial Reporting

Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting for the Company. Internal control
over financial reporting is a process defined to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are
recorded as necessary to permit the preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made
only in accordance with authorizations of management of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company's assets that could have a material effect on the financial statements.

Management
of the Company has evaluated the effectiveness of the Company's internal control over financial reporting as of December 31, 2004. In making this evaluation, the
Company used the criteria established in Internal Control  Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission
(the COSO criteria). Based on its evaluation, management of the Company has identified a material weakness in its internal control over financial reporting with regard to two companies that are
currently providing totalisator services to the Company. A material weakness is a control deficiency, or combination of control deficiencies, that results in more
than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected.

During
the course of management's assessment of the effectiveness of the Company's internal control over financial reporting, the Company requested a Type II Statement on Auditing
Standards ("SAS") 70 report from the three companies that provide totalisator services to the Company. Despite management's timely requests, Scientific Games Racing, LLC
(the parent company of Autotote) and United Tote Company, two of the three companies that provide totalisator services ("tote companies") to the Company, were unable to provide the required SAS
70 reports. The inability of these tote companies to provide the required SAS 70 reports has caused management of the Company to conclude that there is a material weakness in the
Company's internal control over financial reporting. This conclusion is based on the fact that significant financial statement balances including gross wagering revenues, purses, awards and others and
settlements receivable and settlements payable, are balances which are impacted by tote information from these companies. Although management did not identify any accounting adjustments as a result of
inaccurate tote information in these accounts in the Company's financial statements for the year ended December 31, 2004, the inability to obtain a Type II SAS 70 report on the
applicable controls in operation at these two tote companies is considered a material weakness in the Company's internal control over financial reporting because there is a potential of a material
misstatement in gross wagering revenues, purses, awards and others, and settlements receivable and settlements payable in the annual or interim financial statements that would not be prevented or
detected. The Company was able to obtain a Type II SAS 70 report from its third totalisator service provider, Amtote International, Inc.

To
address this material weakness, it is the Company's intention to use its best efforts to pursue one of the following three courses of action:

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As
a result of the material weakness described above, management of the Company has determined that the Company did not maintain effective internal control over its financial reporting
as of December 31, 2004.

Our
management's assessment of the effectiveness of the Company's internal control over financial reporting as of December 31, 2004 has been audited by Ernst &
Young LLP, an independent registered public accounting firm, as stated in their report, which appears below.

Report of Independent Registered Public Accounting Firm

The
Board of Directors and Shareholders of Magna Entertainment Corp.

We
have audited management's assessment, included in the accompanying Management's Report on Internal Control over Financial Reporting Offering under Item 9A, that Magna
Entertainment Corp. did not maintain effective internal control over financial reporting as of December 31, 2004, because of the failure to obtain Type II Statement on Auditing Standards
70 reports from two companies that provide totalisator services to the Company, based on criteria established in Internal Control  Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Magna Entertainment Corp.'s management is responsible for maintaining effective internal
control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting. Our responsibility is to express an opinion on management's assessment and an
opinion on the effectiveness of the Company's internal control over financial reporting based on our audit.

We
conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of
internal control over financial reporting, evaluating management's assessment, testing and evaluating the design and operating effectiveness of internal control, and performing such other procedures
as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A
company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide
reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

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A
material weakness is a control deficiency, or combination of control deficiencies, that results in more than a remote likelihood that a material misstatement of the annual or interim
financial statements will not be prevented or detected. The following material weakness has been identified and included in management's assessment: during the course of management's assessment of the
effectiveness of the Company's internal control over financial reporting, the Company requested a Type II Statement on Auditing Standards ("SAS") 70 report from the three companies that
provide totalisator services to the Company. Despite management's timely requests, Scientific Games Racing, LLC (the parent company of Autotote) and United Tote Company, two of the three
companies that provide totalisator ("tote companies") services to the Company, were unable to provide the required SAS 70 reports. The inability of these tote companies to provide the required
SAS 70 reports has caused management of the Company to conclude that there is a material weakness in the Company's internal control over financial reporting. This conclusion is based on the
fact that significant financial statement balances including gross wagering revenues, purses, awards and others, and settlements receivable and settlements payable, are balances which are impacted by
tote information from these companies. Although management did not identify any accounting adjustments to the Company's consolidated financial statements for the year ended December 31, 2004 as
a result of inaccurate tote information, the inability to obtain a Type II SAS 70 report on the applicable controls in operation at these two tote companies is considered a material
weakness in the Company's internal control over financial reporting because there is a potential of a material misstatement in gross wagering revenues, purses, awards and others, and settlements
receivable and settlements payable in the annual or interim financial statements that would not be prevented or detected.    This material weakness was considered in determining the
nature, timing, and extent of audit tests applied in our audit of the 2004 consolidated financial statements, and this report does not affect our report dated February 7, 2005, except for
Notes 11(a) and 21, as to which the date is, February 18, 2005 on those consolidated financial statements.

In
our opinion, management's assessment that Magna Entertainment Corp. did not maintain effective internal control over financial reporting as of December 31, 2004, is fairly
stated, in all material respects, based on the COSO control criteria. Also, in our opinion, because of the effect of the material weakness described above on the achievement of the objectives of the
control criteria, Magna Entertainment Corp. has not maintained effective internal control over financial reporting as of December 31, 2004, based on the COSO control criteria.

|                               |  | Ernst & Young LLP
|------------------------------ |  | -----------------
|                               |  | GRAPHIC          
|Toronto, Canada
April 26, 2005 |  |                  

Disclosure Controls and Procedures

Based on an evaluation carried out, as of December 31, 2004, under the supervision and with the participation of the Company's management, including its
Chief Executive Officer and Chief Financial Officer, the Chief Executive Officer and Chief Financial Officer have concluded that the Company's disclosure controls and procedures (as defined in
Rule 13a-15(e) and 15(d)-15(e) under the U.S. Securities Exchange Act of 1934) are effective.

The
design of any system of controls and procedures is based in part upon certain assumptions about the likelihood of future events. There can be no assurance that any design will
succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

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PART IV

ITEM 15.    EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

Exhibits.    See
Exhibit Index immediately following signature pages.

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SIGNATURES

Pursuant to the requirements of Section 13 and 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.

| |  | MAGNA ENTERTAINMENT CORP.
| |  | -------------------------
| |  | By:                      

Pursuant
to the requirements of the Securities Exchange Act of 1934, this report on Form 10-K/A has been signed below by the following persons in the capacities
indicated:

|Signature                             |  | Title                                                                              |  | Date
|------------------------------------- |  | ---------------------------------------------------------------------------------- |  | ----
|/s/W. THOMAS HODGSONW. Thomas Hodgson |  | President Chief Executive Officer and Director (Principal Executive Officer)       |  |     
|/s/BLAKE TOHANABlake Tohana           |  | Executive Vice-President and Chief Financial Officer (Principal Financial Officer) |  |     
|/s/MARY LYN SEYMOURMary Lyn Seymour   |  | Controller (Principal Accounting Officer)                                          |  |     
|*John R. Barnett                      |  | Director                                                                           |  |     
|*Jerry D. Campbell                    |  | Director                                                                           |  |     
|*Louis E. Lataif                      |  | Director                                                                           |  |     
|*Edward C. Lumley                     |  | Director                                                                           |  |     
|*Jim McAlpine                         |  | Director                                                                           |  |     
|*William J. Menear                    |  | Director                                                                           |  |     
|*Dennis Mills                         |  | Director                                                                           |  |     
|*Gino Roncelli                        |  | Director                                                                           |  |     
|*Frank Stronach                       |  | Chairman and Director                                                              |  |     

April 27,
2005

By:
/s/BLAKE S. TOHANAName: Blake S. Tohana
Title: Attorney-in-fact

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Exhibit Index

|Exhibit Number |  | Description                                                                                                                                                                                                     
|-------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|23             |  | Consent of Ernst & Young LLP. Filed herewith.                                                                                                                                                                   
|31.1           |  | Certification by Chief Executive Officer pursuant to Rule 13a-14(a) promulgated under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
|31.2           |  | Certification by Chief Financial Officer pursuant to Rule 13a-14(a) promulgated under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.

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