SAO 85766 (b = +20o) is an IRAS source with far-infrared colours similar to planetary nebulae. According to the HDE catalogue, its spectrum in 1940 was that of an A5 star. The UV fluxes and colours derived from data obtained by the TD1 satellite in 1972 also indicate that SAO 85766 was an A-type supergiant at that epoch. However, high resolution spectra of SAO 85766 obtained in 1993 in the wavelength interval 4350Ä to 8820Ä shows that now it is similar to that of an early B type post-AGB supergiant. In addition to the absorptions lines typical of a B1I type star, the spectrum of SAO 85766 is found to show numerous permitted and forbidden emission lines of several elements, typically observed in the spectra of young high density low excitation planetary nebulae. From an analysis of the absorption lines we have estimated Teff=22000+/-500 K, log g=3.0+/-0.5, xi t=15+/-2km s-1 and [M/H]=-0.6. Carbon is found to be strongly underabundant ([C/Fe] = -1.0), similarly to what has been observed in other high galactic latitude hot post-AGB stars. The underabundance of carbon and metals, high galactic latitude, high radial velocity (46 km s-1), the presence of planetary nebula type detached cold circumstellar dust shell and also the presence of low excitation nebular emission lines in the spectrum indicate that SAO 85766 is a low mass star in the post-AGB stage of evolution. The above mentioned characteristics and the variations observed in the spectrum of SAO 85766 suggest that it has rapidly evolved during the past 50 years and it is now in the early stages of the planetary nebula phase. The central star may just have become hot enough to photoionize the circumstellar envelope ejected during the previous AGB phase. >From an analysis of the nebular emission lines we find Te=10000+/- 500K and Ne=2.5 104 cm-3. The nebula also shows an abundance pattern similar to that of the central star. The rapid post-AGB evolution of SAO 85766 appears to be similar to that observed in the case of hot post-AGB star Hen 1357 (= SAO 244567). Based on observations made with the Issac Newton Telescope (INT) operated on the island of La Palma (Spain) by the Instituto de Astrofísica de Canarias in the Spanish Observatorio del Roque de Los Muchachos