VOLKSWAGEN is on a GTI high. Its reborn Golf version has seduced the public and silenced critics with its driver-focussed dynamics, impressive styling and refinement and excellent value for money, and now the Wolfsburg mob is attempting to do the same to the plodding Polo light car. Taking a leaf out of the original ’76 Golf GTI handbook, VW has installed a gutsy engine, slick gearbox, better brakes and firmer suspension in a lightweight package. The results may shock and most certainly delight cost-conscious fun-seekers.

VOLKSWAGEN has done it again. Far from being the tarted-up poor relation of the revelatory MkV Golf GTI, the Polo GTI is a terrific turbo tearaway at an untouchable price in its own right.

Consider this: the dorky old Polo, with its decent chassis and refined cabin, was desperately in need of a visual makeover and way-livelier engines.

That 55kW 1.4-litre lump, though smooth, frankly sucked in the excitement department. It still does actually, if you plonk for a plodding sub-$20K Polo Club or Match auto.

But now, at $26,990 for the fastest-ever Polo by far, there’s a seriously sporting little hot-hatch with Mini-Me GTI looks and a big dose of the Golf’s attitude.

Yep, Volkswagen has sprinkled quite a bit of GTI fairy dust over the hitherto beige-cardiganed Polo.

Above and beyond the new nose with its teardrop headlights replacing round ones that looked like Harry Potter’s glasses, there are moody dark surrounds within those headlight sockets (Harry Pothead?), sassy GTI-style wheels, dual exhausts, a subtle but satisfying bodykit and a rear spoiler.

Sure, they’re all straight from the Hot Hatch 101 School of sexing up a shopping trolley, but they work a treat.

Along with the fat rubber, VW’s decision to lower the firmer suspension 15mm has improved the Polo’s stance and proportion out of sight.

The Polo’s spacious interior was never a nasty place to be in, with VW’s alluring instrument lighting, damped handles, rubber-surfaced crevices and ludicrously over-engineered cupholder that springs out at you like a jack-in-a-box.

Now, to lift the GTI’s ambience, VW has fashioned attractive metallic console trim, very grown up instrumentation with beautiful bespoke markings, a stylish and grippy steering wheel, upmarket audio and a seriously classy set of aluminium door sill cappings.

Yet is there anything more camp than the red stitching and tartan GTI seats that look like they’ve been trimmed from underwear belonging to the Bay City Rollers back in 1976?

They’re comfy though, propping you up like a firm cushion at the helm of a PS2 for some serious action.

And they're supportive through corners too – which is something that you’ll be eager to explore in this Polo.

Now if you happen to be familiar with the previous 1996-2002 Polo – which steered and handled like cold porridge – then you won’t believe how ace this is.

No joke, this car handles like a proper hot hatch. Corners are carved up cleanly and crisply, with a flat stance and a feeling it’s glued to the ground.

The electro-hydraulic steering is full of info and feel, allocating the lucky driver on a snaky road the confidence as well as the ability to fly through the esses. And all with barely a hint of torque steer or bump steer over the dry roads tested.

Just as vitally, the Polo’s need for any sort of speed has obviously been heard at last.

VW obliges with Audi’s ageing yet evergreen 20-valve 1.8-litre turbo-charged four-cylinder unit that debuted in the first A4 1.8T of 1994.

As always it’s a lusty and elastic companion that transforms the Polo from ploddo to polo-coaster at the push of the accelerator pedal.

There’s barely any turbo lag while the midrange kick from 4000rpm is strong and strident. The 80km/h to 120km/h bracket is a particularly brisk blast.

It will also rev happily to 7000rpm (500rpm beyond the redline) with a shed load of torque trailing in its wake.

In fact, this - aided by a high degree of body control - means that gearshifts aren’t always necessary. Third gear and 4000rpm on the tacho is this car’s super sweet spot.

Yet this is no rowdy runabout either, because the engine walks a fine line between being audible enough to engage the ears and yet isolated enough if you don’t want to be mechanically assaulted.

And nor will your dentures be doing the jitterbug thanks to a very expertly damped (though still firm) ride. Further testing on more familiar roads is necessary but the Polo’s cushioning properties are sure to impress.

However, there’s too much road noise entering the cabin, while its occupants are always aware of the suspension doing its thing since it does it loudly.

And although the five-speed manual gearshift has a satisfyingly weighty and precise feel to it, there’s a heaviness of travel to it that might annoy some.

Not helping it out is a too-stubby (though suitably stylish) gearlever that could probably do with one of those spam-email enlargement offers that forever litter peoples’ inboxes.

But, small-time nitpicking aside, what’s the real state of play with the Polo GTI?

Performance-wise this livewire leaves like-sized rivals like the 74kW Ford Fiesta Zetec and 92kW Holden XC Barina SRI pretenders for dead – the Polo is an altogether mightier mouse – while it puts the 100kW Peugeot 206 GTI and 85kW Mini Cooper, costing around $3000 more, on notice.

Only Renault’s 131kW Clio Sport’s next-league-up abilities (and great styling) helps to justify its $6000 premium, although the similarly endowed 206 GTI 180 looks increasingly like a gouge for eight grand more than the Spanish-assembled German hatchback.

Yep, Volkswagen has sprinkled quite a bit of GTI fairy dust over its once comatose light car.

And yes, like a bolt out of the blue, the Polo GTI is a wonderfully welcome addition. We can’t think of another car that offers this level of fun and maturity for the money.

But it’s also a characterful car that goes beyond the sum of its parts to please, which is the Golf GTI’s very essence.

The littlest GTI is a true pocket rocket and a packet of fun.

It’s a Polo, Jim, but not as we know it.