-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 QgYPEHzxQZ0GT8e2/DfpyI2zcmBq+yKk4gKyUN0gG086iz/KQvlZk/WC8+RKzZdc
 00B8vyNaGYdSbJkY5QPeNw==

<SEC-DOCUMENT>0000902664-07-001180.txt : 20070308
<SEC-HEADER>0000902664-07-001180.hdr.sgml : 20070308
<ACCEPTANCE-DATETIME>20070308173921
ACCESSION NUMBER:		0000902664-07-001180
CONFORMED SUBMISSION TYPE:	4
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20070307
FILED AS OF DATE:		20070308
DATE AS OF CHANGE:		20070308

REPORTING-OWNER:	

	OWNER DATA:	
		COMPANY CONFORMED NAME:			GENDELL JEFFREY L ET AL
		CENTRAL INDEX KEY:			0000948904

	FILING VALUES:
		FORM TYPE:		4
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-08520
		FILM NUMBER:		07681939

	BUSINESS ADDRESS:	
		STREET 1:		31 WEST 52ND ST
		STREET 2:		17TH FLOOR
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10019

	MAIL ADDRESS:	
		STREET 2:		200 PARK AVENUE SUITE 3900
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10166

ISSUER:		

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			TERRA INDUSTRIES INC
		CENTRAL INDEX KEY:			0000722079
		STANDARD INDUSTRIAL CLASSIFICATION:	AGRICULTURE CHEMICALS [2870]
		IRS NUMBER:				521145429
		STATE OF INCORPORATION:			MD
		FISCAL YEAR END:			1231

	BUSINESS ADDRESS:	
		STREET 1:		600 FOURTH ST
		STREET 2:		PO BOX 6000
		CITY:			SIOUX CITY
		STATE:			IA
		ZIP:			51102-6000
		BUSINESS PHONE:		7122771340

	MAIL ADDRESS:	
		STREET 1:		600 FOURTH STREET
		STREET 2:		PO BOX 6000
		CITY:			SIOUX CITY
		STATE:			IA
		ZIP:			51102-6000

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	INSPIRATION RESOURCES CORP
		DATE OF NAME CHANGE:	19920517
</SEC-HEADER>
<DOCUMENT>
<TYPE>4
<SEQUENCE>1
<FILENAME>form4_ex.xml
<TEXT>
<XML>
<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0202</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2007-03-07</periodOfReport>

    <notSubjectToSection16>1</notSubjectToSection16>

    <issuer>
        <issuerCik>0000722079</issuerCik>
        <issuerName>TERRA INDUSTRIES INC</issuerName>
        <issuerTradingSymbol>TRA</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0000948904</rptOwnerCik>
            <rptOwnerName>GENDELL JEFFREY L ET AL</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>200 PARK AVENUE</rptOwnerStreet1>
            <rptOwnerStreet2>SUITE 3900</rptOwnerStreet2>
            <rptOwnerCity>NEW YORK</rptOwnerCity>
            <rptOwnerState>NY</rptOwnerState>
            <rptOwnerZipCode>10166</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>0</isDirector>
            <isOfficer>0</isOfficer>
            <isTenPercentOwner>0</isTenPercentOwner>
            <isOther>1</isOther>
            <otherText>No longer 10% Owner</otherText>
        </reportingOwnerRelationship>
    </reportingOwner>

    <nonDerivativeTable>
        <nonDerivativeTransaction>
            <securityTitle>
                <value>Common Stock</value>
            </securityTitle>
            <transactionDate>
                <value>2007-03-07</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>S</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>150000</value>
                </transactionShares>
                <transactionPricePerShare>
                    <value>17.91</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>D</value>
                    <footnoteId id="F3"/>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>9102600</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>I</value>
                </directOrIndirectOwnership>
                <natureOfOwnership>
                    <value>See Footnotes</value>
                    <footnoteId id="F1"/>
                    <footnoteId id="F2"/>
                </natureOfOwnership>
            </ownershipNature>
        </nonDerivativeTransaction>
    </nonDerivativeTable>

    <footnotes>
        <footnote id="F1">The Reporting Person is the managing member of Tontine Capital Management, L.L.C. (&quot;TCM&quot;), a Delaware limited liability
 company, the general partner of Tontine Capital Partners, L.P. (&quot;TCP&quot;), a Delaware limited partnership.  The Reporting
 Person is also the managing member of Tontine Overseas Associates, L.L.C., a Delaware limited liability company (&quot;TOA&quot;), the
 investment adviser to Tontine Capital Overseas Master Fund, L.P., a Cayman Islands partnership (&quot;TCO&quot;).</footnote>
        <footnote id="F2">The Reporting Person directly owns 0 shares of the Common Stock.  TCP directly owns 8,037,500 shares of Common Stock.  TCO
 owns 1,065,100 shares of Common Stock.  All of the foregoing shares of Common Stock may be deemed to be beneficially owned
 by the Reporting Person.  The Reporting Person disclaims beneficial ownership of the Issuer's securities reported herein for
 purposes of Section 16(a) under the Securities Exchange Act of 1934, as amended, or otherwise, except as to securities
 directly owned by the Reporting Person or representing the Reporting Person's pro rata interest in, and interest in the
 profits of, TCP, TCM, TOA and TCO.</footnote>
        <footnote id="F3">Common Stock sold by TCP.</footnote>
    </footnotes>

    <ownerSignature>
        <signatureName>/s/ Jeffrey L. Gendell</signatureName>
        <signatureDate>2007-03-08</signatureDate>
    </ownerSignature>
</ownershipDocument>
</XML>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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