<p>I am currently working on an asp.net application in Visual Studio 2005. I would like to upgrade to 2008 to take advantage of some of the new features, but my remote team won't be able to upgrade to it for a while.</p>

<p>Is it possible for only a few people on my team to upgrade to Visual Studio 2008, while the rest of the team continues to use 2005? </p>

<p>At this point, I don't plan on using any of the 3.0+ foundation stuff yet, so that isn't a concern.</p>

Yes, the project files between 2005 and 2008 are compatible.  The solutions are not, but those are easy to remake or copy.  There is one gotcha with the project files, if you're using Web Applications projects.  The two versions reference different MSBuild target files.  Steven Harman has
a blog with a fix to add to the project file
.
So long as you aren't using anything new from the 3.5 compiler, you should be good.  Note that even if you are targeting the 2.0 Framework, the compiler will still accept 3.5 syntax (var, object initializers, etc.) so you'll still need to be aware of those.