Ownership Submission
FORM 3
 UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

INITIAL STATEMENT OF BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940
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(Print or Type Responses)
1. Name and Address of Reporting Person *
  Rausch Elizabeth M
 2. Date of Event Requiring Statement (Month/Day/Year)
11/09/2006		 3. Issuer Name and Ticker or Trading Symbol
CAPELLA EDUCATION CO [CPLA]
(Last)
(First)
(Middle)
225 SOUTH 6TH STREET, 9TH FLOOR		 4. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
_____ Director _____ 10% Owner
__X__ Officer (give title below) _____ Other (specify below)
VP, Human Resources
 5. If Amendment, Date Original Filed(Month/Day/Year)
(Street)

MINEAPOLIS, MN 55402		 6. Individual or Joint/Group Filing(Check Applicable Line)
_X_ Form filed by One Reporting Person
___ Form filed by More than One Reporting Person
(City)
(State)
(Zip)
Table I - Non-Derivative Securities Beneficially Owned
1.Title of Security
(Instr. 4)		 2. Amount of Securities Beneficially Owned
(Instr. 4)		 3. Ownership Form: Direct (D) or Indirect (I)
(Instr. 5)		 4. Nature of Indirect Beneficial Ownership
(Instr. 5)
Common Stock 2,210
I
By ESOP

Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly. SEC 1473 (7-02)
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Table II - Derivative Securities Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security
(Instr. 4)		 2. Date Exercisable and Expiration Date
(Month/Day/Year)		 3. Title and Amount of Securities Underlying Derivative Security
(Instr. 4)		 4. Conversion or Exercise Price of Derivative Security 5. Ownership Form of Derivative Security: Direct (D) or Indirect (I)
(Instr. 5)		 6. Nature of Indirect Beneficial Ownership
(Instr. 5)
Date Exercisable Expiration Date Title Amount or Number of Shares
Stock Option (right to buy)   (1) 10/21/2009 Common Stock 20,000 $ 4.5 D  
Stock Option (right to buy)   (1) 08/25/2012 Common Stock 6,553 $ 11.71 D  
Stock Option (right to buy)   (2) 10/22/2013 Common Stock 6,670 $ 11.92 D  
Stock Option (right to buy)   (3) 07/27/2014 Common Stock 4,545 $ 17.72 D  
Stock Option (right to buy)   (4) 08/11/2015 Common Stock 4,886 $ 20 D  
Stock Option (right to buy)   (5) 08/01/2013 Common Stock 5,337 $ 20 D  
Class G Preferred Stock   (6)   (6) Common Stock 4,496 $ (6) D  

Reporting Owners

Reporting Owner Name / Address Relationships
Director 10% Owner Officer Other
Rausch Elizabeth M
225 SOUTH 6TH STREET, 9TH FLOOR
MINEAPOLIS, MN 55402		       VP, Human Resources  

Signatures

Michael K. Coddington, Attorney-in-Fact for Elizabeth M. Rausch 11/08/2006
**Signature of Reporting Person Date

Explanation of Responses:

* If the form is filed by more than one reporting person, see Instruction 5(b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1) Immediately.
(2) The option vests as to 25% of the shares annually beginning on October 23, 2004.
(3) The option vests as to 25% of the shares annually beginning on July 28, 2005.
(4) The option vests as to 25% of the shares annually beginning on August 12, 2006.
(5) The option vests as to 25% of the shares annually beginning on August 2, 2007.
(6) The Class G Preferred Stock is immediately convertible into Company common stock on a one-for-one basis and has no expiration date. The Class G Preferred Stock of the Company shall automatically convert into common stock of the Corporation upon the closing of the initial public offering.

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