<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0202</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2007-12-03</periodOfReport>

    <notSubjectToSection16>0</notSubjectToSection16>

    <issuer>
        <issuerCik>0001160497</issuerCik>
        <issuerName>INGERSOLL RAND CO LTD</issuerName>
        <issuerTradingSymbol>IR</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001215820</rptOwnerCik>
            <rptOwnerName>BERZIN ANN C</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>C/O INGERSOLL-RAND COMPANY</rptOwnerStreet1>
            <rptOwnerStreet2>155 CHESTNUT RIDGE ROAD</rptOwnerStreet2>
            <rptOwnerCity>MONTVALE</rptOwnerCity>
            <rptOwnerState>NJ</rptOwnerState>
            <rptOwnerZipCode>07645</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>1</isDirector>
            <isOfficer>0</isOfficer>
            <isTenPercentOwner>0</isTenPercentOwner>
            <isOther>0</isOther>
            <officerTitle></officerTitle>
            <otherText></otherText>
        </reportingOwnerRelationship>
    </reportingOwner>

    <nonDerivativeTable>
        <nonDerivativeHolding>
            <securityTitle>
                <value>Class A Common Shares</value>
            </securityTitle>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>4000</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </nonDerivativeHolding>
        <nonDerivativeTransaction>
            <securityTitle>
                <value>Class A Common Shares (DDCP)</value>
                <footnoteId id="F1"/>
            </securityTitle>
            <transactionDate>
                <value>2007-12-03</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>A</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>47.32</value>
                </transactionShares>
                <transactionPricePerShare>
                    <footnoteId id="F1"/>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>13454.13</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </nonDerivativeTransaction>
        <nonDerivativeTransaction>
            <securityTitle>
                <value>Class A Common Shares (DDCP II)</value>
                <footnoteId id="F2"/>
            </securityTitle>
            <transactionDate>
                <value>2007-12-03</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>A</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>508.91</value>
                </transactionShares>
                <transactionPricePerShare>
                    <footnoteId id="F2"/>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>12754.91</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </nonDerivativeTransaction>
    </nonDerivativeTable>

    <derivativeTable></derivativeTable>

    <footnotes>
        <footnote id="F1">Represents units acquired under the IR Director Deferred Compensation Plan (the &quot;DDCP&quot;), which are subject to the vesting provisions of the DDCP.  The units are to be converted on a one-for-one basis and settled in Class A common shares upon the reporting person's termination of employment with the issuer, or earlier or later upon certain elections.</footnote>
        <footnote id="F2">Represents units acquired under the IR Director Deferred Compensation Plan II (the &quot;DDCP II&quot;), which are subject to the vesting provisions of the DDCP II.  The units are to be converted on a one-for-one basis and settled in Class A common shares upon the reporting person's termination of employment with the issuer, or earlier or later upon certain elections.</footnote>
    </footnotes>

    <ownerSignature>
        <signatureName>By:/s/Barbara A. Santoro - Attorney-in-Fact</signatureName>
        <signatureDate>2007-12-05</signatureDate>
    </ownerSignature>
</ownershipDocument>
