U.S. SECURITIES AND EXCHANGE COMMISSION

____________________________

FORM 40-F

£Registration statement pursuant to Section 12 of the Securities Exchange Act of
1934 
orQAnnual report pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934

|For the fiscal year ended December 31, 2008 | Commission File Number 001-31722
|------------------------------------------- | --------------------------------

____________________________

New Gold Inc.

|British Columbia                       | 1000                                            | Not Applicable        
|-------------------------------------- | ----------------------------------------------- | ----------------------
|(Province or other
    jurisdiction of | (Primary Standard Industrial
    Classification | (I.R.S. Employer      
|incorporation or organization)         | Code Number)                                    | Identification Number)

Suite 3110, 666 Burrard Street 
Vancouver, British Columbia, Canada V6C 2X8
 (604) 696-4100 (Address and telephone number of Registrant's principal executive offices)

____________________________

DL Services Inc. 
U.S. Bank Centre, 1420 5th Avenue, Suite 3400 
Seattle, WA 98101-4010 
(206) 903-8800 (Name, address (including zip code) and telephone number 
(including area code) of agent for service in the United States)

____________________________

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

|Title of Each Class:        | Name of Each Exchange On Which Registered:
|--------------------------- | ------------------------------------------
|Common Shares, no par value | NYSE Amex LLC                             

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

Securities for which there is a reporting obligation pursuant
to Section 15(d) of the Act: None

For annual reports, indicate by check mark the information
filed with this form:

Q  
Annual Information Form                  Q  
Audited Annual Financial Statements

Indicate the number of outstanding shares of each of the
issuer's classes of capital or common stock as of the close of the period
covered by the annual report.

At December 31, 2008, the Registrant had outstanding
212,860,746 common shares without par value.

Indicate by check mark whether the Registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the Exchange Act
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.    Q  
Yes      £  
No

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DOCUMENTS INCORPORATED BY REFERENCE

The Annual Information Form ("AIF") of New Gold Inc. (the "Registrant" or the
"Company") for the fiscal year ended December 31, 2008 is incorporated herein by
reference.

The audited consolidated financial statements of the Company
for the years ended December 31, 2008 and 2007, including the report of the
auditors with respect thereto, are incorporated herein by reference. For a
reconciliation of important differences between Canadian and United States
generally accepted accounting principles, see Note 17 to the Company's audited
consolidated financial statements.

The Company's management's discussion and analysis ("MD&A") for the year
ended December 31, 2008 is incorporated herein by reference.

EXPLANATORY NOTE

The Company is a Canadian issuer eligible to file its annual
report pursuant to Section 13 of the Exchange Act on Form 40-F. The Company is a
"foreign private issuer" as defined in Rule 3b-4 under the Exchange Act.
Accordingly, the Company's equity securities are exempt from Sections 14(a),
14(b), 14(c), 14(f) and 16 of the Exchange Act pursuant to Rule 3a12-3.

The Company is permitted, under a multi-jurisdictional
disclosure system adopted by the United States, to prepare this annual report on
Form 40-F in accordance with Canadian disclosure requirements, which are
different from those of the United States.

Information concerning the properties and operations of the
Company included or incorporated by reference herein has been prepared in
accordance with Canadian standards under applicable Canadian securities laws,
and may not be comparable to similar information for United States companies.
The terms "Mineral Resource", "Measured Mineral Resource", "Indicated Mineral
Resource" and "Inferred Mineral Resource" used in this report and the documents
incorporated by reference herein are Canadian mining terms as defined in
accordance with National Instrument 43-101 under guidelines set out in the
Canadian Institute of Mining, Metallurgy and Petroleum ("CIM") Standards on
Mineral Resources and Mineral Reserves adopted by the CIM Council on December
11, 2005. While the terms "Mineral Resource", "Measured Mineral Resource",
"Indicated Mineral Resource" and "Inferred Mineral Resource" are recognized and
required by Canadian regulations, they are not defined terms under standards of
the United States Securities and Exchange Commission (the "Commission"). Under
United States standards, mineralization may not be classified as a "reserve"
unless the determination has been made that the mineralization could be
economically and legally produced or extracted at the time the reserve
calculation is made. As such, certain information contained or incorporated by
reference in this report concerning descriptions of mineralization and resources
under Canadian standards is not comparable to similar information made public by
United States companies subject to the reporting and disclosure requirements of
the Commission. An "Inferred Mineral Resource" has a great amount of uncertainty
as to its existence and as to its economic and legal feasibility. It cannot be
assumed that all or any part of an "Inferred Mineral Resource" will ever be
upgraded to a higher category. Under Canadian rules, estimates of Inferred
Mineral Resources may not form the basis of feasibility or other economic
studies. Readers are cautioned not to assume that all or any part of Measured or
Indicated Resources will ever be converted into Mineral Reserves. Readers are
also cautioned not to assume that all or any part of an "Inferred Mineral
Resource" exists, or is economically or legally mineable. In addition, the
definitions of "Proven Mineral Reserves" and "Probable Mineral Reserves" under
CIM standards differ in certain respects from the standards of the Commission.

The Company prepares its financial statements in accordance
with Canadian generally accepted accounting practices ("GAAP"), and they may be
subject to Canadian auditing and auditor independence standards. Accordingly,
the financial statements of the Company included in this report may not be
comparable to financial statements of United States companies. Significant
differences between Canadian GAAP and United States GAAP are described in Note
17to the audited consolidated financial statements of the Company
included in this report.

Unless otherwise indicated, all dollar amounts are reported in U.S. dollars.

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FORWARD LOOKING STATEMENTS

This annual report and the documents incorporated by
reference contain "forward-looking statements", within the meaning of the United
States Private Securities Litigation and Reform Act of 1995 and applicable
Canadian Securities legislation. Forward-looking statements include, but are not
limited to, statements with respect to the future prices of gold, silver and
copper, the estimation of mineral reserves and resources, the realization of
mineral reserve estimates, the timing and amount of estimated future production,
costs of production, capital expenditures, financing requirements, costs and
timing of the development of new and existing deposits, implementation, timing
and success of drilling and other exploration activities, permitting time lines,
the completion and success of acquisitions, currency exchange rate fluctuations,
requirements for additional capital, government regulation of mining operations,
environmental risks, remediation and reclamation procedures and expenses, title
disputes or claims and limitations on insurance coverage. Generally, these
forward-looking statements can be identified by the use of forward-looking
terminology such as "plans", "expects", or "does not expect", "is expected",
"budget", "scheduled", "estimates", "forecasts" ,"intends", "anticipates", or
"does not anticipate", or "believes", or variations of such words and phrases or
state that certain actions, events or results "may", "could", "would", "might"
or "will" or "will be taken", "occur" or "be achieved". Forward-looking
statements are subject to known and unknown risks, uncertainties and other
factors that may cause the actual results, level of activity, performance or
achievements of the Company to be materially different from those expressed or
implied by such forward-looking statements, including but not limited to: the
Company and Western Goldfields will be able to satisfy the conditions in the
Western Goldfields Transaction referred to in the Annual Information Form
incorporated by reference herein, that the required approvals (shareholder,
third party regulatory and governmental) will be obtained and all other
conditions will be satisfied or waived; the results of the preliminary economic
assessment assessing the viability of a new process facility at Amapari; capital
requirements; fluctuations in the international currency markets and in the
rates of exchange of the currencies of Canada, the United States, Australia,
Brazil, Mexico and Chile; price volatility in the spot and forward markets for
commodities; impact of any hedging activities, including margin limits and
margin calls; discrepancies between actual and estimated production, between
actual and estimated reserves and resources and between actual and estimated
metallurgical recoveries; changes in national and local government legislation
in Canada, the United States, Australia, Brazil, Mexico and Chile or any other
country in which the Company currently or may in the future carry on business
with respect to production, export controls, taxes, expropriation of property,
repatriation of profits, the environment, land use, water use, indigenous land
claims, and mine safety, among other things; taxation; controls, regulations and
political or economic developments in the countries in which the Company does or
may carry on business; the speculative nature of mineral exploration and
development, including the risks of obtaining necessary licenses and permits;
diminishing quantities or grades of reserves; competition; loss of key
employees; additional funding requirements; actual results of current
exploration or reclamation activities; changes in project parameters as plans
continue to be refined; uncertainties of integrating business acquisitions,
accidents; labour disputes; and defective title to mineral claims or property or
contests over claims to mineral properties. In addition, there are risks and
hazards associated with the business of mineral exploration, development, and
mining, including environmental hazards, industrial accidents, unusual or
unexpected formations, pressures, cave-ins, flooding and gold bullion losses
(and the risk of inadequate insurance or inability to obtain insurance, to cover
these risks) as well as other risks and uncertainties described under "Risks
Factors" in the Annual Information Form and in the Management's Discussion and
Analysis for the year ended December 31, 2008, which are expressly incorporated
by reference herein.

Although the Company has attempted to identify important
factors that would cause actual results to differ materially from those
contained in forward-looking statements, there may be other factors that cause
results not to be as anticipated, estimated, or intended. There can be no
assurance that such statements will prove to be accurate, as actual results and
future events could differ materially from those anticipated in such statements.
All of the forward-looking statements contained in this document are qualified
by these cautionary statements. Readers should not place undue reliance on
forward-looking statements. The Company expressly disclaims any intention or
obligation to update or revise any forward-looking statements whether as a
result of new information, events or otherwise, except in accordance with
applicable securities laws.

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DISCLOSURE CONTROLS AND PROCEDURES

The Company's Chief Executive Officer and Chief Financial
Officer have evaluated the effectiveness of the Company's disclosure controls
and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) as of December 31, 2008.
Based on the evaluation, the Chief Executive Officer and Chief Financial Officer
concluded that the disclosure controls and procedures in place are effective to
ensure that information required to be disclosed by the Company in reports that
the Company files or submits under the Exchange Act, is recorded, processed,
summarized and reported on a timely basis in accordance with applicable time
periods specified by the Commission rules and forms. Disclosure controls and
procedures include, without limitation, controls and procedures designed to
ensure that information required to be disclosed by the Company in reports that
it files or submits under the Exchange Act is accumulated and communicated to
the Company's management, including its principal executive and financial
officers, or persons performing similar functions, as appropriate, to allow
timely decisions regarding required disclosure.

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL
REPORTING

The Company's management, including the Chief Executive
Officer and the Chief Financial Officer, is responsible for establishing and
maintaining adequate internal control over financial reporting. Internal control
over financial reporting is defined in Rule 13a-15(f) and Rule 15d-15(f)
promulgated under the Exchange Act as a process designed by, or under the
supervision of, the Company's principal executive and principal financial
officers and effected by the Company's Board of Directors, management and other
personnel, 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. The
Company's internal control over financial reporting includes those policies and
procedures that:

- pertain to the
  maintenance of records that, in reasonable detail, accurately and fairly
  reflect the transactions and dispositions of the assets of the Company;
- 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
- provide reasonable
  assurance regarding prevention or timely detections of unauthorized
  acquisition, use or disposition of the Company's assets that could have a
  material effect on the financial statements.

On May 9, 2008, the Company entered into an agreement to
complete a business combination (the "Business Combination") with Metallica
Resources Inc. and Peak Gold Ltd. ("Peak"). The Business Combination was
completed on June 30, 2008 and constituted a reverse merger for accounting
purposes. Although the "New Gold" name was retained following completion of the
Business Combination, Peak was considered the acquirer for accounting purposes.
Management of the Company, acting reasonably, carefully considered the scope of
their evaluation of internal control over financial reporting, taking into
consideration the Commission staff's guidance in Question 3 of the Commission's
Management's Report on Internal Control Over Financial Reporting and
Certification of Disclosure in Exchange Act Periodic Reports  Frequently Asked
Questions (revised September 24, 2007). Management of the Company concluded that
it would be impractical to complete an evaluation of the design and operational
effectiveness of the controls over the Peak business, which includes the Peak
mine in Australia and the Amapari mine in Brazil, other than the controls over
the period-end financial close process, as of December 31, 2008. This conclusion
was based on the following reasons:

- Given the limited time between the completion of the
  Business Combination and year end, the Company could not have implemented a
  comprehensive Sarbanes-Oxley Act of 2002 internal controls program for the
  Peak business prior to the time management was required to make its assessment
  of internal control over financial reporting.

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- Peak was a TSX Venture
  Exchange-listed company and was not in a position to comply with the
  requirements of the Sarbanes-Oxley Act of 2002.
- The Business Combination was a
  complicated transaction involving a three-way merger.
- Although the management of Peak
  survived the Business Combination, the management team after the business
  combination was very small and resources were limited.

Accordingly, management excluded from its assessment the
internal control over financial reporting at the Peak mine in Australia and the
Amapari mine in Brazil, which, on a combined basis, constitute 12% of total
assets, 78% of total revenues, and 82% of the loss from operations of the
corresponding consolidated financial statement amounts of the Company as at and
for the year ended December 31, 2008.

Management's current plans include the completion of an
assessment of the design and operational effectiveness of the internal control
over financial reporting applicable to the Peak and Amapari mines beginning in
2009.

The Company's management assessed the effectiveness of the
Company's internal control over financial reporting as of December 31, 2008. In
making this assessment, it used the criteria set forth in the Internal
Control-Integrated Framework issued by the Committee of Sponsoring Organizations
of the Treadway Commission (COSO). Based on our assessment, management has
concluded that, as of December 31, 2008, the Company's internal control over
financial reporting is effective based on those criteria.

The effectiveness of the Company's internal control over
financial reporting as at December 31, 2008 has been audited by Deloitte & Touche LLP, the Company's independent registered chartered accountants, as
stated in their report immediately preceding the Company's audited consolidated
financial statements for the year ended December 31, 2008 and the thirteen
months ended December 31, 2007.

ATTESTATION REPORT OF THE REGISTERED PUBLIC ACCOUNTING FIRM

The reports immediately preceding the Company's audited
consolidated financial statements for the year ended December 31, 2008 and the
thirteen months ended December 31, 2007 is incorporated by reference herein.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

During the fiscal year ended December 31, 2008, there were no
changes in the Company's internal control over financial reporting that have
materially affected, or are reasonably likely to materially affect, the
registrant's internal control over financial reporting.

LIMITATIONS ON DISCLOSURE CONTROLS AND PROCEDURES AND INTERNAL
CONTROL OVER FINANCIAL REPORTING

The Company's management, including the Chief Executive
Officer and the Chief Financial Officer, believe that any disclosure controls
and procedures or internal controls over financial reporting, no matter how well
conceived and operated, can provide only reasonable, not absolute, assurance
that the objectives of the control system are met. Further, the design of a
control system must reflect the fact that there are resource constraints, and
the benefits of controls must be considered relative to their costs. Because of
the inherent limitations in all control systems, they cannot provide absolute
assurance that all control issues and instances of fraud, if any, within the
Company have been prevented or detected. These inherent limitations include the
realities that judgments in decision making can be faulty, and that breakdowns
can occur because of simple error or mistake. Additionally, controls can be
circumvented by the individual acts of some persons, by collusion of two or more
people, or by unauthorized override of the control. The design of any systems of
controls also is based in part upon certain assumptions about the likelihood of
future events, and there can be no assurance that any design will succeed in
achieving its stated goals under all potential future conditions. Accordingly,
because of the inherent limitations in a cost effective control system,
misstatements due to error or fraud may occur and not be detected.

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AUDIT COMMITTEE IDENTIFICATION AND FINANCIAL EXPERT

The Company has an Audit Committee established by the Board
of Directors for the purpose of overseeing the accounting and financial
reporting processes of the Company and audits of the financial statements of the
Company, in accordance with Section 3(a)(58)(A) of the Exchange Act. The members
of the Audit Committee are James Estey, Pierre Lassonde and Paul Sweeney
(Chair). Each of Mr. Sweeney, Mr. Estey and Mr. Lassonde is "independent" as
that term is defined under the rules of the NYSE Amex LLC.

The Board has designated Paul Sweeney as the "Audit Committee Financial
Expert" as that term is defined under Section 407 of the Sarbanes-Oxley Act of
2002 and paragraph (8) of General Instruction B. of Form 40-F.

PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information provided under the headings "Pre-Approval Policies and
Procedures" (page 86) and "External Auditor Service Fees (By Category)" (page
87) contained in the AIF is incorporated by reference herein.

CODE OF ETHICS

In connection with a comprehensive review of the Company's
corporate governance policies, on August 13, 2008, the Board of Directors of the
Company (the "Board") approved the adoption of a code of business conduct and
ethics ("Code"). The Code was reviewed and updated on March 12, 2009. The Code
is applicable to all directors, officers and employees of the Company, including
its Chief Executive Officer, Chief Financial Officer and principal accounting
officer. The Code was adopted to, among other things, update and clarify the
duties, obligations and responsibilities that are imposed upon the persons
subject to its provisions. Additionally, on July 8, 2008, as amended November
24, 2008 and ratified on March 12, 2009, the Board approved the adoption of a
Whistleblower Policy ("Whistleblower Policy"), which outlines the principles and
commitments that the Company has made with respect to the treatment of
complaints by its personnel. Copies of the Code and the Whistleblower Policy are
available on the Company's website at www.newgold.com.

There were no waivers of the Code in the past fiscal year.

OFF-BALANCE SHEET ARRANGEMENTS

The Company does not have any off-balance sheet arrangements.

TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONS

|                                       | Payments due by period
|-------------------------------------- | ----------------------
|                                       |                       
|Contractual obligations (in US$ 000's) | Total                 
|                                       |                       
|Long-term debt                         | $238,447              
|Interest payable on long-term debt     | 187,654               
|Commitments                            | 25,591                
|New Afton                              | 406                   
|Asset retirement obligations           | 33,200                
|Total contractual obligations          | $485,298              

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NYSE AMEX LLC CORPORATE GOVERNANCE

The Company's common shares are listed on the NYSE Amex LLC
("Amex"). Section 110 of the Amex company guide permits Amex to consider the
laws, customs and practices of foreign issuers in relaxing certain Amex listing
criteria, and to grant exemptions from Amex listing criteria based on these
considerations. A company seeking relief under these provisions is required to
provide written certification from independent local counsel that the noncomplying practice is not prohibited by home country law. A description of
the significant ways in which the Company's governance practices differ from
those followed by domestic companies pursuant to Amex standards is contained on
the Company's website at www.newgold.com.

UNDERTAKINGS

The Company undertakes to make available, in person or by
telephone, representatives to respond to inquiries made by the Commission staff,
and to furnish promptly, when requested to do so by the Commission staff,
information relating to: the securities registered pursuant to Form 40-F; the
securities in relation to which the obligation to file an annual report on Form
40-F arises; or transactions in said securities.

CONSENT TO SERVICE OF PROCESS

The Company has  filed with the Commission an amendment No. 1
to the
written consent to service of process and power of attorney on Form F-X. Any
change to the name or address of the Company's agent for service shall be
communicated promptly to the Commission by amendment to the Form F-X referring
the file number of the Company.



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SIGNATURES

Pursuant to the requirements of the Exchange Act, the
Registrant certifies that it meets all of the requirements for filing on Form
40-F and has duly caused this annual report to be signed on its behalf by the
undersigned, thereunto duly authorized.

|                     | NEW GOLD INC.                 
|-------------------- | ------------------------------
|                     |                               
|                     |                               
|                     |                               
|                     | "Basil Huxham"                
|                     | Name: Basil Huxham            
|                     | Title: Chief Financial Officer
|                     |                               
|Date: March 31, 2009 |                               

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EXHIBIT INDEX

The following documents are being filed with the Commission as exhibits to
this annual report on Form 40-F.

|Exhibit | Description                                                                                                                                                                                                
|------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|99.1.   | Annual Information Form for the
    year ended December 31, 2008                                                                                                                                           
|99.2.   | Audited Consolidated Financial
    Statements for the years ended December 31, 2008 and 2007, including the
    report of the auditors with respect thereto                                                
|99.3.   | Management's Discussion and
    Analysis for the year ended December 31, 2008                                                                                                                              
|99.4.   | Code of Business Conduct and
    Ethics                                                                                                                                                                    
|99.5.   | Certification of Chief Executive
    Officer as Required by Rule 13a-14(a) under the Exchange Act                                                                                                          
|99.6.   | Certification of Chief Financial
    Officer as Required by Rule 13a-14(a) under the Exchange Act                                                                                                          
|99.7.   | Certification of Chief Executive
    Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section
    906 of the Sarbanes-Oxley Act of 2002                                                  
|99.8.   | Certification of Chief Financial
    Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section
    906 of the Sarbanes-Oxley Act of 2002                                                  
|99.9.   | Consent of Deloitte & Touche LLP                                                                                                                                                                           
|99.10.  | Consent of Peter Lloyd                                                                                                                                                                                     
|99.11.  | Consent of Rex Berthelsen                                                                                                                                                                                  
|99.12.  | Consent of Eric Strom                                                                                                                                                                                      
|99.13.  | Consent of William Rose                                                                                                                                                                                    
|99.14.  | Consent of WLR Consulting, Inc.                                                                                                                                                                            
|99.15.  | Consent of Scott Wilson Roscoe
    Postle Associates Inc.                                                                                                                                                  
|99.16.  | Consent of David Rennie                                                                                                                                                                                    
|99.17.  | Consent of AMC Consultants Pty
    Ltd.                                                                                                                                                                    
|99.18.  | Consent of Mike Thomas                                                                                                                                                                                     
|99.19.  | Consent of Barton Stone                                                                                                                                                                                    
|99.20.  | Consent of Richard Lambert                                                                                                                                                                                 
|99.21.  | Consent of Pincock, Allen & Holt                                                                                                                                                                           
|99.22.  | Business Acquisition Report
    dated September 12, 2008 incorporated by reference in Exhibit 99.1 to the
    Registrant's Current Report on Form 6-K furnished to the Commission on
    September 16, 2008

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