IE quirks mode making page render strange - LI elements not horizontal

I'm having a strange issue with quirks mode in IE 8. I'm working on a web page that is supposed to be rendering a horizontal menu bar. In FF and IE normal mode, it renders perfectly. However, when I set IE to quirks mode, the li elements of the UL render vertically and I'm not sure how to fix it.

Here is the CSS:

#primaryNav {
    background:url(/images/sprite_primary_nav.gif) repeat-x; 
    border:1px solid #dfdfdf;
    clear:both;
    height:49px;
    margin:0 auto;
    width:985px;
}
#primaryNav ul {
    list-style: none;
    margin:0;

}
#primaryNav ul li {
    border-left:1px solid #dfdfdf;
    display:list-item;
    float:left;
    height:49px;
    padding-bottom:0px;  

}
#primaryNav ul li a {
    border:1px solid #ffffff;
    color:#333333;
    display:block;
    font-family:ScalaOTRegular, "Times New Roman", Arial;
    font-size:123.1%;
    height:32px;
    padding:15px 23px 0px;
    text-decoration:none;
}
#primaryNav ul li a.afterActive, #primaryNav ul li a.firstNavItem {
    border-left:0px;
}
#primaryNav ul li.active a {
    background:url(../images/sprite_primary_nav.gif) repeat-x 0px -49px;
}
#primaryNav ul li:first-child {
    margin-left:41px;
}
#primaryNav ul li:last-child {
    border-right:1px solid #dfdfdf !important;
}
.primaryNavLast {
    border-right:1px solid #dfdfdf !important;
}

Here is the html:

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN" "http://www.w3.org/TR/html4/loose.dtd">
<html lang="en">
<head>
    <meta http-equiv="Content-Type" content="text/html; charset=utf-8" />
    <meta name="description" content=""/>
    <meta name="keywords" content=""/>
    <link rel="stylesheet" type="text/css" href="/css/reset.css" media="screen"/>
    <link rel="stylesheet" type="text/css" href="/css/delta_screen.css" media="screen"/>

    <script src="scripts/jquery-1.6.4.min.js"></script>
</head>
<body>
    <div id="primaryNav" class="addShadowShadowPrimaryNav">
        <ul>
            <li><a href="#">Home</a></li>
            <li><a href="#">Etiamn</a></li>
            <li><a href="#">Integer</a></li>
            <li><a href="#">Rhoncus</a></li>
            <li><a href="#">Sagittis</a></li>
            <li><a href="#">Facilisis &amp; Inte</a></li>
        </ul>
    </div><!--end primaryNav-->
<!-- end scripts -->
</body>
</html>

Any ideas? Thanks!!

Solution

Is it definitely going into quirks mode? I can't see any reason why it would do so.

It might be IE7 compatibility mode -- that's quite a common 'gotcha' issue, as there are some browser settings that can cause it to switch modes without telling you, particularly when you're viewing the site on your local network.