The draw for the 2007 Setanta Cup competition was made on 7 December 2006 with the original competing teams being the identical ones to the previous year's competition. On 30 January 2007, however, Shelbourne announced that they were withdrawing from the competition for reasons relating to their financial troubles and the fact that they would be unlikely to field a team of players. Their place was given to the 2006 FAI Cup runners-up to Derry City, St Patrick's Athletic, despite the fact that the next best-placed in the previous season's league (Shelbourne's qualification route), who did not have a place in the Setanta Cup already, were Sligo Rovers.
Group stage
The draw for this round was held 7 December 2006. The matches were played 26 February-17 April 2007.
Teams that progressed to the Semi-Finals are indicated in bold type.
Teams eliminated from the Setanta Cup are indicated in italics.
The draw for the semi-finals was made by drawing the winners of Group A against the runners-up of Group B and vice versa, with group winners having home advantage. There would be no replays if the matches were drawn; instead, extra time would decide winners immediately thereafter. If extra time did not decide the winners, a set of five alternating penalty kicks would decide winners.