<PAGE>
              UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C. 20549

                                 FORM 10-K

(Mark One)
[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

     For the fiscal year ended  September 30, 1997
                                ------------------
          OR

[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

     For the transition period from           to
                                     --------    --------
Commission file number    1-9961
                        ----------

                      TOYOTA MOTOR CREDIT CORPORATION
---------------------------------------------------------------------------
          (Exact name of registrant as specified in its charter)

               California                                 95-3775816
----------------------------------------            -----------------------
    (State or other jurisdiction of                     (I.R.S. Employer
     incorporation or organization)                    Identification No.)

        19001 S. Western Avenue
          Torrance, California                               90509
----------------------------------------            -----------------------
(Address of principal executive offices)                   (Zip Code)

Registrant's telephone number, including area code       (310) 787-1310
                                                    -----------------------

Securities registered pursuant to section 12(b) of the Act:

                                                     Name of each exchange
          Title of each class                         on which registered
          -------------------                       -----------------------
      6.30% Fixed Rate Medium-Term
       Notes due January 25, 1999                   New York Stock Exchange
----------------------------------------            -----------------------

Securities registered pursuant to Section 12(g) of the Act:  None

          Indicate by check mark whether the registrant (1) has filed all 
reports required to be filed by Section 13 or 15(d) of the Securities Exchange 
Act of 1934 during the preceding 12 months (or for such shorter period that 
the registrant was required to file such reports), and (2) has been subject to 
such filing requirements for the past 90 days.               Yes   X   No
                                                                  ---      ---

          Indicate by check mark if disclosure of delinquent filers pursuant 
to Item 405 of Regulation S-K is not contained herein, and will not be 
contained, to the best of registrant's knowledge, in definitive proxy or 
information statements incorporated by reference in Part III of this Form 10-K 
or any amendment to this Form 10-K.   [X]

          As of November 30, 1997, the number of outstanding shares of capital 
stock, par value $10,000 per share, of the registrant was 91,500, all of which 
shares were held by Toyota Motor Sales, U.S.A., Inc.

                                      -1-

<PAGE>
                                    PART I

ITEM 1.   BUSINESS.

General

Toyota Motor Credit Corporation ("TMCC") is a wholly-owned subsidiary of 
Toyota Motor Sales, USA, Inc. ("TMS") and was incorporated in California in 
1982 and commenced operations in 1983.  TMCC provides retail leasing, retail 
and wholesale financing and certain other financial services to authorized 
Toyota and Lexus vehicle and Toyota industrial equipment dealers and their 
customers in the United States (excluding Hawaii)and the Commonwealth of 
Puerto Rico. TMCC has seven wholly-owned subsidiaries, four of which are 
engaged in the insurance business, one limited purpose subsidiary formed 
primarily to acquire and securitize retail finance receivables, one limited 
purpose subsidiary formed primarily to acquire and securitize lease finance 
receivables and one subsidiary which provides retail and wholesale financing 
and certain other financial services to authorized Toyota and Lexus vehicle 
dealers and their customers in the Commonwealth of Puerto Rico. TMCC and its 
subsidiaries are collectively referred to as the "Company".  

The Company's earnings are primarily impacted by the level of average earning 
assets, comprised primarily of investments in operating leases and finance 
receivables, and asset yields as well as outstanding borrowings and the cost 
of funds.  The Company's business is substantially dependent upon the sale of 
Toyota and Lexus vehicles in the United States.  Changes in the volume of 
sales of such vehicles resulting from governmental action, changes in consumer 
demand, changes in pricing of imported units due to currency fluctuations, or 
other events, could impact the level of finance and insurance operations of 
the Company.  To date, the level of the Company's operations has not been 
restricted by the level of sales of Toyota and Lexus vehicles.

An operating agreement between TMCC and TMS (the "Operating Agreement"), 
provides that TMCC will establish its own financing rates and is under no 
obligation to TMS to finance wholesale obligations from any dealers or retail 
obligations of any customers.  In addition, pursuant to the Operating 
Agreement, TMS will arrange for the repurchase of new Toyota and Lexus 
vehicles financed at wholesale by TMCC at the aggregate cost financed in the 
event of dealer default.  The Operating Agreement also specifies that TMS will 
retain 100% ownership of TMCC as long as TMCC has any funded debt outstanding 
and that TMS will make necessary equity contributions or provide other 
financial assistance TMS deems appropriate to ensure that TMCC maintains a 
minimum coverage on fixed charges of 1.10 times such fixed charges in any 
fiscal quarter.  Under the Operating Agreement, all loans by TMS to TMCC must 
be subordinated to all other indebtedness of TMCC.  As a result of the 
reorganization of Toyota's manufacturing operations in the United States and 
the accompanying establishment of Toyota Motor Manufacturing North America, 
Inc. ("TMMNA") described below under "Toyota Motor Sales, U.S.A., Inc.", the 
Operating Agreement was amended to require TMMNA, in addition to TMS, to 
provide financial assistance as necessary to maintain TMCC's minimum fixed 
charge coverage ratio and to require that any loans made by TMMNA to TMCC will 
be subordinated at all times to other indebtedness of TMCC. The Operating 
Agreement does not constitute a guarantee by TMS or TMMNA of any obligations 
of TMCC.  The fixed charge coverage provision of the Operating Agreement is 
solely for the benefit of the holders of TMCC's commercial paper, and the 
Operating Agreement may be amended or terminated at any time without notice 
to, or the consent of, holders of other TMCC obligations.

                                      -2-

<PAGE>
Retail Leasing

TMCC purchases primarily new vehicle lease contracts originated by Toyota and 
Lexus dealers.  Lease contracts purchased must first meet TMCC's credit 
standards after which TMCC assumes ownership of the leased vehicles and is 
generally permitted to take possession of vehicles upon lessee default.  TMCC 
is responsible for contract collection and administration during the lease 
period and for the value of the vehicle at lease maturity if the vehicle is 
not purchased by the lessee or dealer. Off-lease vehicles returned to TMCC are 
sold through a network of auction sites located throughout the United States. 
TMCC requires lessees to carry fire, theft, collision and liability insurance 
on leased vehicles covering the interests of both TMCC and the lessee.  In 
recent years, TMS has sponsored special lease programs by supporting reduced 
lease rates.  Leasing revenues contributed 83%, 82% and 78% to total financing 
revenues for the fiscal years ended September 30, 1997, 1996 and 1995, 
respectively.  

In October 1996, TMCC created Toyota Lease Trust, a Delaware business trust 
(the "Titling Trust"), to act as lessor and to hold title to leased vehicles 
in specified states in connection with a lease securitization program.  TMCC 
acts as the servicer for lease contracts purchased by the Titling Trust from 
Toyota and Lexus dealers and services such lease contracts in the same manner 
as contracts owned directly by TMCC.  TMCC holds an undivided trust interest 
in lease contracts owned by the Titling Trust, and such lease contracts are 
included in TMCC's lease assets, until such time as the beneficial interests 
in such contracts are transferred in connection with a securitization 
transaction.

Retail Financing

TMCC purchases primarily new and used vehicle installment contracts from 
Toyota and Lexus dealers.  Certain of the used vehicle contracts purchased by 
TMCC are "Certified" Toyota and Lexus used vehicle contracts which relate to 
vehicles purchased by dealers, reconditioned and certified to meet certain 
Toyota and Lexus standards, and sold or leased with an extended warranty from 
the manufacturer.  Installment contracts purchased must first meet TMCC's 
credit standards and thereafter TMCC retains responsibility for contract 
collection and administration.  TMCC acquires security interests in the 
vehicles financed and generally can repossess vehicles if customers fail to 
meet contract obligations.  Substantially all of TMCC's retail financings are 
non-recourse which relieves the dealers from financial responsibility in the 
event of repossession.  TMCC requires retail financing customers to carry 
fire, theft and collision insurance on financed vehicles covering the 
interests of both TMCC and the customer.  In recent years, TMS has sponsored 
special retail programs by supporting reduced interest rates.  Retail 
financing revenues contributed 14%, 14% and 18% to total financing revenues 
for the fiscal years ended September 30, 1997, 1996 and 1995, respectively.

                                      -3-

<PAGE>
A summary of vehicle retail leasing and financing activity follows:

<TABLE>
<CAPTION>
                                     Years Ended September 30,
                          -------------------------------------------------
                             1997      1996      1995      1994      1993
                          ---------  --------  --------  --------  --------
<S>                        <C>       <C>       <C>       <C>       <C>     
Contract volume:
   Lease................    262,000   276,000   179,000   204,000   112,000
   Retail...............    247,000   229,000   170,000   210,000   200,000
                          ---------  --------  --------  --------  --------
      Total.............    509,000   505,000   349,000   414,000   312,000
                          =========  ========  ========  ========  ========
Average amount financed:
   Lease................    $24,200   $23,300   $24,800   $23,700   $23,400
   Retail...............    $16,500   $16,200   $15,100   $14,000   $12,800

Outstanding portfolio at
   period end ($Millions):
      Lease.............    $11,622   $11,917    $9,305    $7,569    $4,604
      Retail............     $5,866    $5,105    $4,489    $5,162    $4,440
      Number of accounts  1,061,000 1,069,000   946,000   929,000   750,000

</TABLE>

Retail receivables and interests in lease finance receivables sold, totaling 
$2.4 billion as of September 30, 1997 and $1.1 billion as of September 30, 
1996, which TMCC continues to service, are excluded from the outstanding 
portfolio amounts in the above table.

Wholesale Financing

TMCC provides wholesale financing primarily to qualified Toyota and Lexus 
vehicle dealers to finance inventories of new Toyota and Lexus vehicles and 
used Toyota, Lexus and other vehicles.  TMCC acquires security interests in 
vehicles financed at wholesale, and substantially all such financings are 
backed by corporate or individual guarantees from or on behalf of 
participating dealers.  In the event of dealer default, TMCC has the right to 
liquidate any assets acquired and seek legal remedies pursuant to the 
guarantees.  Pursuant to the Operating Agreement, TMS will arrange for the 
repurchase of new Toyota and Lexus vehicles financed at wholesale by TMCC at 
the aggregate cost financed in the event of dealer default.

A summary of vehicle wholesale financing activity follows:

<TABLE>
<CAPTION>
                                         Years Ended September 30,
                              ------------------------------------------------
                                1997      1996      1995      1994      1993
                              --------  --------  --------  --------  --------
<S>                           <C>       <C>       <C>       <C>       <C>
Dealer loans ($Millions).....   $8,573    $8,017    $7,626    $7,055    $6,378
Dealer repayments ($Millions)   $8,684    $8,221    $7,444    $7,032    $6,152
Outstanding portfolio at
   period end ($Millions)....     $563      $668      $886      $727      $703
Average amount financed
   per vehicle...............  $20,695   $19,926   $18,999   $17,530   $16,500
</TABLE>

TMCC also makes term loans to dealers for business acquisitions, facilities 
refurbishment, real estate purchases and working capital requirements.  These 
loans are typically secured with liens on real estate, other dealership assets 
and/or personal guarantees of the dealers.  Wholesale and other dealer 
financing revenues contributed 3%, 4% and 4% to total financing revenues for 
the fiscal years ended September 30, 1997, 1996 and 1995, respectively.

                                      -4-

<PAGE>
Insurance

The principal activities of TMCC's insurance subsidiaries include marketing, 
underwriting, claims administration and providing certain coverages related to 
vehicle service agreements and contractual liability agreements sold by or 
through Toyota and Lexus vehicle dealers and affiliates to customers.  In 
addition, the insurance subsidiaries insure and reinsure certain TMS and TMCC 
risks.  Income before income taxes from insurance operations contributed 12%, 
7% and 6% to total income before income taxes for the fiscal years ended 
September 30, 1997, 1996 and 1995, respectively.

Servicing

TMCC remains as servicer on accounts included in its asset-backed 
securitization transactions and is paid a servicing fee.

Funding

Funding to support the Company's level of earning assets is provided by access 
to the capital markets as well as earning asset liquidations and funds 
provided by operating activities.  Capital market funding has generally been 
in the form of commercial paper, United States and Euro medium-term notes, 
Eurobonds and transactions through the Company's asset-backed securitization 
programs.

The Company uses a variety of derivative financial instruments to manage 
interest rate and currency exchange exposures.  The derivative instruments 
utilized include cross currency and interest rate swap agreements, indexed 
note swap agreements and option-based products.  The Company does not use any 
of these instruments for trading purposes.

Competition and Government Regulations

TMCC's primary competitors for retail leasing and financing are commercial 
banks, savings and loan associations, credit unions, finance companies and 
other captive automobile finance companies.  Commercial banks and other 
captive automobile finance companies also provide wholesale financing for 
Toyota and Lexus dealers.  Competition for the principal products and services 
provided through the insurance operations is primarily from national and 
regional independent service contract providers.  TMCC's strategy is to 
supplement, with competitive financing and insurance programs, the overall 
commitment of TMS to offer a complete package of services to authorized Toyota 
and Lexus dealers and their customers.

The finance and insurance operations of the Company are regulated under both 
federal and state law.  A majority of states have enacted legislation 
establishing licensing requirements to conduct retail and other finance and 
insurance activities.  Most states also impose limits on the maximum rate of 
finance charges.  In certain states, the margin between the present statutory 
maximum interest rates and borrowing costs is sufficiently narrow that, in 
periods of rapidly increasing or high interest rates, there could be an 
adverse effect on the Company's operations in these states if the Company were 
unable to pass on increased interest costs to its customers.  In addition, 
state laws differ as to whether anyone suffering injury to person or property 
involving a leased vehicle may bring an action against the owner of the 
vehicle merely by virtue of that ownership.  To the extent that applicable 
state law permits such an action, TMCC may be subject to liability to such an 
injured party.  However, the laws of most states either do not permit such 
suits or limit the lessor's liability to the amount of any liability insurance 
that the lessee was required under applicable law to maintain (or, in some 
states, the lessor was permitted to maintain), but failed to maintain.  TMCC's 
lease contracts contain provisions requiring the lessees to maintain levels of 
insurance satisfying applicable state law and TMCC maintains certain levels of 
contingent liability insurance for protection from catastrophic claims.

                                      -5-

<PAGE>
The Company's operations are also subject to regulation under federal and 
state consumer protection statutes.  The Company continually reviews its 
operations for compliance with applicable laws.  Future administrative 
rulings, judicial decisions and legislation may require modification of the 
Company's business practices and documentation.

Employee Relations

At November 30, 1997, the Company had approximately 2,400 full-time employees. 
The Company considers its employee relations to be good.

Segment Information

Financial information regarding industry segments is set forth in Note 16 of 
the Notes to Consolidated Financial Statements.

                                      -6-

<PAGE>
Toyota Motor Sales, U.S.A., Inc.

TMS was established in 1957 and as of September 30, 1997 is a wholly-owned 
subsidiary of Toyota Motor North America, Inc. ("TMA").  TMS is primarily 
engaged in the wholesale distribution of automobiles, light trucks, industrial 
equipment and related replacement parts and accessories throughout the United 
States (excluding Hawaii).  Additionally, TMS exports automobiles and related 
replacement parts and accessories to Europe, Asia and United States 
territories.  Through September 30, 1996, TMS manufactured certain automobiles 
through Toyota Motor Manufacturing, U.S.A., Inc., and manufactured trucks 
through Toyota Auto Body Corporation, Inc. ("TABC"), a wholly owned 
subsidiary.  Effective October 1, 1996, Toyota Motor Manufacturing North 
America, Inc. ("TMMNA") was established to serve as the holding company for 
all manufacturing operations in the United States and to coordinate and 
support numerous manufacturing related administrative functions previously 
carried out independently by various Toyota entities in North America and by 
Toyota Motor Corporation ("TMC") in Japan.  Both TMMNA and TMS are wholly-
owned subsidiaries of TMA, a holding company owned 100% by TMC which was 
established on September 3, 1996.

TMS's corporate headquarters is located in Torrance, California.  TMS has port 
facilities, regional sales offices and parts distribution centers located 
throughout the United States.  Toyota vehicles are distributed in the United 
States in twelve regional sales areas, ten of which are operated by or through 
TMS and two which are serviced by private distributors who purchase vehicles 
directly from TMS and distribute to Toyota dealers within their respective 
regions.  For the year ended September 30, 1997, these private distributors, 
Gulf States Toyota, Inc. of Houston, Texas and Southeast Toyota Distributors, 
Inc. of Deerfield Beach, Florida, accounted for approximately 31% of the 
Toyota vehicles sold in the United States (excluding Hawaii).  Lexus vehicles 
are directly distributed by TMS to Lexus dealers throughout the United States 
(excluding Hawaii).

For the year ended September 30, 1997, TMS sold approximately 1,190,000 
automobiles and light trucks in the United States (excluding Hawaii), of which 
approximately 731,000 were manufactured in the United States; TMS exported 
approximately 39,000 automobiles.  TMS sales represented approximately 27% of 
TMC's worldwide sales volume for the year ended March 31, 1997.  For the years 
ended September 30, 1997 and 1996, Toyota and Lexus vehicles accounted for 
approximately 8.0% and 7.5%, respectively, of all retail automobile and light 
truck sales in the United States.

Total revenues for TMS for the fiscal years ended September 30, 1997, 1996 and 
1995, aggregated approximately $28.8 billion, $27.5 billion and $26.2 billion, 
respectively, of which approximately $25.3 billion, $24.4 billion and 
$23.7 billion, respectively, were attributable to revenues other than those 
associated with financial services.  At September 30, 1997, 1996 and 1995, TMS 
had total assets of approximately $23.6 billion, $25.1 billion and 
$21.1 billion, respectively.  TMS had net worth in excess of $4.1 billion and 
net income in excess of $225 million for each of the fiscal years ended 
September 30, 1997, 1996 and 1995.

Total revenues for TMMNA for the fiscal year ended September 30, 1997 
aggregated approximately $10.6 billion, all of which was attributable to 
revenues other than those associated with financial services.  At 
September 30, 1997, TMMNA had total assets of approximately $3.5 billion, and 
net worth in excess of $2.1 billion.  TMMNA had net income in excess of 
$100 million for the fiscal year ended September 30, 1997.

                                      -7-

<PAGE>
ITEM 2.   PROPERTIES.

The headquarters of the Company is located in Torrance, California, with 33 
branch offices in cities throughout the United States and one branch office in 
the Commonwealth of Puerto Rico.  A financial service center is located in 
Cedar Rapids, Iowa.  All premises are occupied under lease.

ITEM 3.   LEGAL PROCEEDINGS.

Various claims and actions are pending against TMCC and its subsidiaries with 
respect to financing activities, taxes and other matters arising from the 
ordinary course of business.  Certain of these actions are or purport to be 
class action suits.  Management and internal and external counsel perform 
periodic reviews of pending claims and actions to determine the probability of 
adverse verdicts and resulting amounts of liability.  The amounts of liability 
on pending claims and actions as of September 30, 1997 were not determinable; 
however, in the opinion of management, the ultimate liability resulting 
therefrom should not have a material adverse effect on TMCC's consolidated 
financial position or results of operations.

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

Not applicable.


                                  PART II


ITEM 5.   MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
          MATTERS.

TMCC is a wholly-owned subsidiary of TMS and, accordingly, all shares of the 
Company's stock are owned by TMS.  There is no market for TMCC's stock.

No dividends have been declared or paid to date.

                                      -8-

<PAGE>
ITEM 6.   SELECTED FINANCIAL DATA.

<TABLE>
<CAPTION>
                                           Years Ended September 30,
                                  -------------------------------------------
                                   1997     1996     1995     1994     1993
                                  -------  -------  -------  -------  -------
                                              (Dollars in Millions)
<S>                               <C>      <C>      <C>      <C>      <C>
INCOME STATEMENT DATA

Financing Revenues:

Leasing.......................... $ 2,739  $ 2,454  $ 1,902  $ 1,230  $   751
Retail financing.................     446      415      431      413      468
Wholesale and other
   dealer financing..............      89      109      121       86       80
                                  -------  -------  -------  -------  -------
Total financing revenues.........   3,274    2,978    2,454    1,729    1,299

Depreciation on leases...........   1,790    1,626    1,230      735      385
Interest expense.................     918      820      716      486      454
                                  -------  -------  -------  -------  -------
Net financing revenues...........     566      532      508      508      460

Other revenues...................     176      136      113       95       80
                                  -------  -------  -------  -------  -------
Net financing revenues
   and other revenues............     742      668      621      603      540
                                  -------  -------  -------  -------  -------
Expenses:

Operating and administrative.....     323      293      255      232      225
Provision for credit losses......     136      115       66       78       60
                                  -------  -------  -------  -------  -------
Total expenses...................     459      408      321      310      285
                                  -------  -------  -------  -------  -------

Income before income taxes.......     283      260      300      293      255

Provision for income taxes.......     121      108      117      118       97
                                  -------  -------  -------  -------  -------
Net Income....................... $   162  $   152  $   183  $   175  $   158
                                  =======  =======  =======  =======  =======

Ratio of earnings to
   fixed charges.................    1.31     1.32     1.42     1.60     1.56


BALANCE SHEET DATA

Investments in operating
  leases, net.................... $10,257  $10,831   $8,148   $6,215   $3,050
Finance receivables, net.........  $8,452   $7,474   $7,227   $7,834   $7,226
Total assets..................... $19,830  $19,309  $16,225  $14,791  $11,179
Notes and loans payable.......... $14,745  $15,014  $12,696  $11,833   $8,833
Capital stock....................    $915     $915     $865     $865     $680
Retained earnings................  $1,159     $997     $844     $662     $487

</TABLE>

Certain prior period amounts have been reclassified to conform with the 
current period presentation.

                                      -9-

<PAGE>
ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS.


FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Net Income
----------

The following table summarizes TMCC's net income by business segment for the 
fiscal years ended September 30, 1997, 1996 and 1995:

<TABLE>
<CAPTION>
                                             Years Ended September 30,
                                             ------------------------
                                             1997      1996      1995
                                             ----      ----      ----
<S>                                          <C>       <C>       <C>
                                              (Dollars in Millions)
Net income:
  Financing operations................       $142      $140      $171
  Insurance operations................         20        12        12
                                             ----      ----      ----
     Total net income.................       $162      $152      $183
                                             ====      ====      ====
</TABLE>

The increase in TMCC's consolidated net income in fiscal 1997 is primarily 
attributable to earnings growth in TMCC's insurance operations, while the 
decline in fiscal 1996 net income reflects primarily higher provisions for 
vehicle disposition and credit losses and lower net interest margins in TMCC's 
financing operations.  Net interest margins reflect the difference between 
interest rates implicit in leases and charged on retail, wholesale and other 
finance receivables, and interest rates paid on borrowings.

Net income from financing operations increased 1% in fiscal 1997 and decreased 
18% in fiscal 1996.  The increase in fiscal 1997 reflects higher net financing 
revenues attributable to earning asset growth and increased income from asset-
backed securitization transactions, substantially offset by lower net interest 
margins, higher vehicle disposition and credit losses and increased personnel 
and operating expenses attributable to the increased account base.  The 
decrease in fiscal 1996 reflects higher provisions for credit and vehicle 
disposition losses, lower net interest margins and higher personnel and 
operating expenses partially offset by higher financing revenues from earning 
asset growth and increased income from asset-backed securitization 
transactions.

Net income from insurance operations increased 67% in fiscal 1997 and remained 
stable in fiscal 1996.  The increase in fiscal 1997 reflects increased 
underwriting profit from providing coverage under various agreements as well 
as higher investment income.

                                      -10-

<PAGE>
Earning Assets
--------------

The composition of TMCC's net earning assets (excluding retail receivables and 
interests in lease finance receivables sold through securitization 
transactions), contract volume and finance penetration as of and for the years 
ended September 30, 1997, 1996, and 1995 are as follows:

<TABLE>
<CAPTION>
                                                      September 30,
                                               ---------------------------
                                                1997      1996      1995
                                               -------   -------   -------
                                                     (Dollars in Millions)
<S>                                            <C>       <C>       <C>

Vehicle lease
  Investment in operating leases, net........  $10,124   $10,745    $8,084
  Finance leases, net........................    1,498     1,172     1,221
                                               -------   -------   -------
Total vehicle leases.........................   11,622    11,917     9,305

Vehicle retail finance receivables, net......    5,866     5,105     4,489
Vehicle wholesale and other receivables......    1,434     1,486     1,752
Allowance for credit losses..................     (213)     (203)     (171)
                                               -------   -------   -------
Total net earning assets.....................  $18,709   $18,305   $15,375
                                               =======   =======   =======

</TABLE>

<TABLE>
<CAPTION>
                                                Years Ended September 30,
                                               ---------------------------
                                                1997      1996      1995
                                               -------   -------   -------
<S>                                            <C>       <C>       <C>
Contract volume:
   Vehicle lease.............................  262,000   276,000   179,000
   Vehicle retail............................  247,000   229,000   170,000
                                               -------   -------   -------
Total........................................  509,000   505,000   349,000
                                               =======   =======   =======

TMS sponsored contract volume:
   Vehicle lease.............................   72,000   190,000   111,000
   Vehicle retail............................   17,000    52,000    48,000
                                               -------   -------   -------
Total........................................   89,000   242,000   159,000
                                               =======   =======   =======

Retail volume:
   New volume................................  144,000   157,000   125,000
   Used volume...............................  103,000    72,000    45,000
                                               -------   -------   -------
Total........................................  247,000   229,000   170,000
                                               =======   =======   =======

Finance penetration (excluding fleet)........    36.2%     41.2%     31.8%

</TABLE>

                                      -11-

<PAGE>
TMCC's net earning assets as of September 30, 1997 increased from 
September 30, 1996 due to growth in retail earning assets, partially offset by 
a decline in lease and wholesale earning assets.  Retail earning assets 
increased from 1996 primarily due to a higher level of used vehicle (primarily 
increased Toyota and Lexus Certified used vehicles) financing in 1997, 
partially offset by the sale of finance receivables totaling $784 million in 
April 1997. Lease earning assets, consisting of investment in operating 
leases, net of accumulated depreciation, and lease finance receivables, net of 
unearned income, declined in 1997 from 1996 due to a higher level of lease 
maturities and the sale of $1.3 billion of interests in lease finance 
receivables during September 1997 in connection with a securitization 
transaction.  The decline in wholesale earning assets from 1996 levels is 
attributable primarily to lower dealer inventories as a result of strong 
demand for certain Toyota and Lexus vehicles.  The increase in allowance for 
credit losses reflects asset growth as well as an increased mix of used 
vehicles in the retail portfolio for which loss reserves are provided at 
higher levels than new vehicles.

In October 1996, TMCC created Toyota Lease Trust, a Delaware business trust 
(the "Titling Trust"), to act as a lessor and to hold title to leased vehicles 
in specified states.  The value of the lease contracts purchased by the 
Titling Trust in fiscal 1997 represented approximately 22% of all lease 
contracts purchased by both TMCC and the Titling Trust.  Substantially all 
leases owned by the Titling Trust are classified as finance receivables due to 
certain residual value insurance arrangements in place with respect to such 
leases, while leases of similar nature originated outside of the Titling Trust 
are classified as operating leases.  The continued acquisition of leases by 
the Titling Trust is expected to cause a shift in the composition of earning 
assets from operating leases to finance receivables due to the classification 
differences described above.

TMCC's net earning assets as of September 30, 1996 increased from 
September 30, 1995 primarily due to growth in lease earning assets due to 
higher lease volume attributable to special lease programs sponsored by TMS.

TMS sponsors special lease and retail programs which allow TMCC to offer 
reduced monthly payments on certain Toyota and Lexus new vehicles and Toyota 
industrial equipment to qualified lease and retail customers.  Support amounts 
received from TMS approximate the balances required by TMCC to maintain 
revenues at standard program levels and are earned over the expected lease and 
retail installment contract terms.  The level of sponsored program activity 
varies based on TMS marketing strategies and revenues earned vary based on the 
mix of Toyota and Lexus vehicles, timing of programs and the level of support 
provided.  TMCC's revenues earned from TMS sponsored special lease and retail 
contracts outstanding totaled $174 million, $174 million and $134 million for 
fiscal years 1997, 1996 and 1995, respectively.

TMCC's lease contract volume for the year ended September 30, 1997 declined 
from 1996 levels as a result of lower finance penetration attributable to 
reduced levels of lease programs sponsored by TMS.  This decline was 
substantially offset by the strong sales of Toyota and Lexus vehicles as a 
result, in part, of consumer acceptance and competitive pricing of certain new 
and redesigned 1997 Toyota and Lexus models and TMCC's competitive leasing 
programs.

TMCC's retail contract volume for the year ended September 30, 1997 increased 
from 1996 levels as a result of higher used contract volume and strong Toyota 
and Lexus sales, partially offset by slightly lower finance penetration 
attributable to reduced TMS sponsored special retail programs.

Higher contract volume and finance penetration in 1996 compared to 1995 
reflected increased volume primarily attributable to the TMS sponsored special 
lease programs.

                                      -12-

<PAGE>
Financing Revenue and Other Revenues
------------------------------------

TMCC's total financing revenues increased 10% in fiscal 1997 and 21% in fiscal 
1996. The increase in fiscal 1997 reflects growth in average retail and lease 
earning assets, partially offset by a decline in average wholesale earning 
assets.  The increase in fiscal 1996 reflects growth in average lease earning 
assets, partially offset by a decline in average retail and wholesale earning 
assets. TMCC's continued use of the Titling Trust to purchase leases, which 
may be sold in connection with securitization transactions, is expected to 
shift the composition of earning assets from operating leases to finance 
receivables, as discussed earlier, and will result in increased revenues from 
finance leases (until such interests in leases are sold in securitization 
transactions) and reduced operating lease revenues and depreciation expense.

The following table summarizes TMCC's other income for the fiscal years ended 
September 30, 1997, 1996 and 1995:

<TABLE>
<CAPTION>
                                               Years Ended September 30,
                                              --------------------------
                                              1997       1996       1995
                                              ----       ----       ----
                                                 (Dollars in Millions)
<S>                                           <C>        <C>        <C>
Insurance operations revenues...............  $130       $110        $98
Gains and servicing fees on assets sold.....    40         23         13
Investment and other income.................     6          3          2
                                              ----       ----       ----
   Total other income.......................  $176       $136       $113
                                              ====       ====       ====
</TABLE>

Insurance operations revenues increased 19% in fiscal 1997 due to higher 
underwriting revenues associated with in-force agreements as well as increased 
investment income.  The increase in such revenues in fiscal 1996 is due 
primarily to higher underwriting revenues associated with in-force agreements.

The increases in gains and servicing fee income in fiscal 1997 and 1996 
reflect an increase in the amount of assets sold through the Company's asset-
backed securitization programs.  Gains recognized on asset-backed 
securitization transactions generally accelerate the recognition of income on 
lease and retail contracts, net of servicing fees and other related deferrals, 
into the period the assets are sold.  Numerous factors can affect the timing 
and amounts of these gains, such as the type and amount of assets sold, the 
structure of the sale and current financial market conditions.

                                      -13-

<PAGE>
Lease Depreciation
------------------

Included in lease depreciation expense are:  (i) straight-line depreciation 
expense on operating leases to the contractual residual value (ii) provision 
for residual value losses on operating leases and (iii) actual vehicle 
disposition losses and gains.  Operating lease depreciation expense increased 
$164 million and $394 million during fiscal 1997 and fiscal 1996, 
respectively, primarily due to growth in average operating lease assets. The 
provision for losses on returned operating lease vehicles declined $48 million 
in fiscal 1997 and increased $34 million during fiscal 1996.  The reduction in 
the rate of growth of the allowance in 1997 is consistent with the slowing 
rate of growth in lease assets and the Company's determination that the 
overall level of the allowance is appropriate.  The increase in provision in 
1996 was consistent with the high growth in operating lease assets from 1995 
levels.  Vehicle disposition losses increased $61 million and $22 million 
during fiscal 1997 and fiscal 1996, respectively, reflecting primarily 
increased volume of returned units corresponding with a higher level of 
scheduled maturities and a higher vehicle return rate.  TMCC's operating lease 
portfolio includes contracts with terms ranging from 12 to 54 months; the 
average original contract term in TMCC's operating lease portfolio was 
35 months at September 30, 1997 and 36 months at September 30, 1996, 
respectively.  As discussed earlier, the continued acquisition of leases by 
the Titling Trust is expected to shift the composition of earning assets from 
operating leases to finance receivables which will result in increased 
revenues from finance leases (until such interests in leases are sold in 
securitization transactions) and reduced operating lease revenues and 
depreciation expense.

TMCC is subject to residual value risk in connection with its lease portfolio; 
TMCC's residual value risk is a function of the number of off-lease vehicles 
returned for disposition and any shortfall between the net disposition 
proceeds and the estimated unguaranteed residual values on returned vehicles. 
Total unguaranteed residual values related to TMCC's vehicle lease portfolio 
totaled approximately $9.0 billion and $8.8 billion at September 30, 1997 and 
1996, respectively.  The percentage of lease vehicles returned to and disposed 
of by TMCC which were originally scheduled to mature during fiscal 1997 was 
18% as compared to 14% and 11% during fiscal 1996 and 1995, respectively.  
TMCC maintains an allowance for estimated losses on lease vehicles returned to 
the Company for disposition at lease termination.  The level of allowance 
required to cover future vehicle disposition losses is based upon projected 
vehicle return rates and projected residual value losses on core models 
derived from market information on used vehicle sales, historical factors, 
including lease return trends, and general economic factors.  The provision 
for losses on returned lease vehicles is included in TMCC's depreciation 
expense for operating leases and in leasing revenues for direct finance 
leases.  Actual vehicle disposition losses and gains are included in 
depreciation expense.  As the lease portfolio has matured the level of vehicle 
lease returns have increased; however, the Company actively manages 
disposition of its lease vehicles and believes that its lease earning assets, 
net of the allowance for losses, are recorded at net realizable value.

Interest Expense
----------------

Interest expense increased 12% and 15% in fiscal 1997 and 1996, respectively. 
The increase in fiscal 1997 reflects higher average borrowings outstanding 
required to fund the growth in average earning assets, slightly offset by a 
decline in the average cost of borrowings. The increase in fiscal 1996 
reflects higher average borrowings outstanding and an increase in the average 
cost of borrowings.  The weighted average cost of borrowings was 5.87%, 5.90% 
and 5.78% for the years ended September 30, 1997, 1996 and 1995, respectively.

                                      -14-

<PAGE>
Operating and Administrative Expenses
-------------------------------------

Operating and administrative expenses increased 10% and 15% in fiscal 1997 and 
1996, respectively.  The increases reflect primarily additional personnel and 
operating costs required to support TMCC's growing customer base as well as 
growth in the Company's insurance operations.  TMCC anticipates continued 
growth in expenses reflecting increasing headcount and operating costs 
associated with portfolio growth and expanded customer service activities as 
well as costs in connection with computer system and software modifications to 
address year 2000 issues.

Provision for Credit Losses
---------------------------

TMCC's provision for credit losses increased 18% and 74% during fiscal 1997 
and fiscal 1996, respectively.  The increase in fiscal 1997 reflects higher 
credit losses, increasing mix of used vehicles in the retail portfolio and 
earning asset growth.  The increase in fiscal 1996 was primarily related to 
the growth in earning assets and higher credit losses.  Higher credit losses 
in 1997 reflect an increasing number of repossessed vehicles and higher losses 
per repossessed vehicle attributable to greater lease and retail accounts 
outstanding, higher mix of used vehicles in the retail portfolio which 
historically produce higher losses than new business and maturing of the lease 
portfolio.  TMCC has not significantly altered its underwriting standards.  
Allowances for credit losses are evaluated periodically, considering 
historical loss experience and other factors, and are considered adequate to 
cover expected credit losses as of September 30, 1997.

                                      -15-

<PAGE>
An analysis of credit losses and the related allowance follows, excluding net 
losses on receivables sold subject to limited recourse provisions:

<TABLE>
<CAPTION>
                                          Years ended September 30,
                                    ------------------------------------
                                    1997    1996    1995    1994    1993
                                    ----    ----    ----    ----    ----
                                            (Dollars in Millions)   
<S>                                 <C>     <C>     <C>     <C>     <C>
Allowance for credit losses
   at beginning of period.........  $203    $171    $164    $121    $107
Provision for credit losses.......   136     115      66      78      60
Charge-offs.......................  (116)    (81)    (63)    (47)    (51)
Recoveries........................    12      12      12      12      11
Other Adjustments.................   (22)    (14)     (8)      -      (6)
                                    ----    ----    ----    ----    ----
Allowance for credit losses
   at end of period...............  $213    $203    $171    $164    $121
                                    ====    ====    ====    ====    ====
Allowance as a percent of net
   investments in operating
   leases and net receivables
   outstanding....................  1.13%   1.10%   1.10%   1.15%   1.16%

Losses as a percent of average
   net investments in operating
   leases and average net
   receivables outstanding........   .55%    .41%    .34%    .30%    .41%

Aggregate balances at end of
   period for lease rentals 
   and installments 60
   or more days past due..........   $30     $29     $20     $15     $16

Aggregate balances at end of
   period for lease rentals
   and installments 60 or more
   days past due as a percent
   of net investments in operating
   leases and gross receivables
   outstanding....................   .15%    .15%    .12%    .10%    .14%

</TABLE>

                                      -16-

<PAGE>
LIQUIDITY AND CAPITAL RESOURCES

The Company requires, in the normal course of business, substantial funding to 
support the level of its earning assets.  Significant reliance is placed on 
the Company's ability to obtain debt funding in the capital markets in 
addition to funding provided by earning asset liquidations and cash provided 
by operating activities as well as transactions through the Company's asset-
backed securities programs.  Debt issuances have generally been in the form of 
commercial paper, United States and Euro medium-term notes ("MTNs") and 
Eurobonds.  On occasion, this funding has been supplemented by loans and 
equity contributions from TMS.

Commercial paper issuances are utilized to meet short-term funding needs.  
Commercial paper outstanding under TMCC's commercial paper program ranged from 
approximately $1.2 billion to $3.0 billion during fiscal 1997, with an average 
outstanding balance of $1.9 billion.  For additional liquidity purposes, TMCC 
maintains syndicated bank credit facilities with certain banks which 
aggregated $2.0 billion at September 30, 1997.  No loans were outstanding 
under any of these bank credit facilities during fiscal 1997. TMCC also 
maintains, along with TMS, uncommitted, unsecured lines of credit with banks 
totaling $250 million.  At September 30, 1997, TMCC had issued approximately 
$24 million in letters of credit, primarily related to the Company's insurance 
operations.

Long-term funding requirements are met through the issuance of a variety of 
debt securities underwritten in both the United States and international 
capital markets.  United States and Euro MTNs and Eurobonds have provided TMCC 
with significant sources of funding.  During fiscal 1997, TMCC issued 
approximately $4.6 billion of MTNs and Eurobonds of which approximately 
$4.4 billion had original maturities greater than one year.

The original maturities of all MTNs and Eurobonds outstanding at September 30, 
1997 ranged from one to eleven years. At September 30, 1997, the amounts 
outstanding under MTNs and Eurobonds, including the effect of foreign currency 
translations at September 30, 1997 spot exchange rates, are as follows:

<TABLE>
<CAPTION>
                                        Total
                                       U.S. and 
                                       Foreign         Foreign
                                       Currency        Currency 
                                     Denominated     Denominated
                                    -------------   -------------
<S>                                 <C>             <C>
MTNs..............................  $10.6 billion    $4.5 billion
Eurobonds.........................    2.5 billion     1.5 billion
                                    -------------    ------------
                                    $13.1 billion    $6.0 billion
                                    =============    ============
</TABLE>

                                      -17-

<PAGE>
TMCC anticipates continued use of MTNs in both the United States and 
international capital markets.  At November 30, 1997, approximately 
$483 million was available for issuance under TMCC's United States public MTN 
program, $15 million of which was committed for issue by the Company.  The 
maximum aggregate principal amount authorized to be outstanding at any time 
under TMCC's Euro MTN program is $16.0 billion, which was increased in July 
1997 from the prior maximum of $12.0 billion.  Approximately $5.6 billion was 
available for issuance under the Euro MTN program as of November 30, 1997, of 
which the Company has committed to issue approximately $21 million.  The 
United States and Euro MTN programs may be expanded from time to time to allow 
for the continued use of these sources of funding.  In addition, approximately 
$700 million of securities registered with the Securities and Exchange 
Commission, excluding MTNs, were available for issuance at November 30, 1997.

Additionally, TMCC utilizes its asset-backed securitization programs to 
generate funds for investment in earning assets.  During the year ended 
September 30, 1997, TMCC sold retail finance receivables totaling $784 million 
and interests in lease finance receivables totaling $1,283 million as 
described in Note 7 of the Notes to the Consolidated Financial Statements.  On 
October 1, 1996, Toyota Lease Trust was created as a Delaware business trust 
for the purpose of titling leases, originated in certain states, in connection 
with the lease securitization program.  TMCC anticipates that the number and 
principal amount of leases purchased by the Toyota Lease Trust will comprise a 
significant and increasing percentage of what otherwise would have been TMCC's 
lease portfolio; however, until leases are included in a securitization 
transaction, they will continue to be classified as finance receivables on 
TMCC's balance sheet.

TMCC utilizes a variety of interest rate and currency derivative financial 
instruments to manage interest rate and currency exchange exposures.  The 
derivative instruments utilized include cross currency and interest rate 
swaps, indexed note swaps and option-based products.  TMCC does not use any of 
these instruments for trading purposes.  The total notional amount of TMCC's 
derivative financial instruments at September 30, 1997 and 1996 was 
$20.8 billion and $20.5 billion, respectively.  The notional amounts of 
interest rate and indexed note swap agreements and option-based products do 
not represent amounts exchanged by the parties and, thus, are not a measure of 
the Company's exposure through its use of derivatives.  The only market rate 
risk related to TMCC's portfolio is interest rate risk as foreign currency 
risks are entirely hedged through cross currency interest rate swap 
agreements.

TMCC utilizes interest rate swap agreements in managing its exposure to 
interest rate fluctuations.  Interest rate swap agreements are executed as an 
integral part of specific debt transactions or on a portfolio basis. TMCC's 
interest rate swap agreements involve agreements to pay fixed and receive a 
floating rate, or receive fixed and pay a floating rate, at specified 
intervals, calculated on an agreed-upon notional amount.  Interest rate swap 
agreements may also involve basis swap contracts which are agreements to 
exchange the difference between certain floating interest amounts, such as the 
net payment based on the commercial paper rate and the London Interbank 
Offered Rate ("LIBOR"), calculated on an agreed-upon notional amount.

                                      -18-

<PAGE>
TMCC also utilizes option-based products in managing its exposure to interest 
rate fluctuations.  Option-based products are executed on a portfolio basis 
and consist primarily of purchased interest rate cap agreements.  Option-based 
products are agreements which either grant TMCC the right to receive or 
require TMCC to make payments at specified interest rate levels.

TMCC utilizes indexed note swap agreements in managing its exposure in 
connection with debt instruments whose interest rate and/or principal 
redemption amounts are derived from other underlying instruments.  Indexed 
note swap agreements involve agreements to receive interest and/or principal 
amounts associated with the indexed notes, denominated in either U.S. dollars 
or a foreign currency, and to pay fixed or floating rates on fixed U.S. dollar 
liabilities.

TMCC utilizes cross currency interest rate swap agreements to entirely hedge 
exposure to exchange rate fluctuations on principal and interest payments for 
borrowings denominated in foreign currencies.  Notes and loans payable issued 
in foreign currencies are hedged by concurrently executed cross currency 
interest rate swap agreements which involve the exchange of foreign currency 
principal and interest obligations for U.S. dollar obligations at agreed-upon 
currency exchange and interest rates.

Derivative financial instruments utilized by TMCC involve, to varying degrees, 
elements of credit risk in the event a counterparty should default and market 
risk as the instruments are subject to rate and price fluctuations.  Credit 
risk is managed through the use of credit standard guidelines, counterparty 
diversification, monitoring of counterparty financial condition and master 
netting agreements in place with all derivative counterparties.  TMCC does not 
currently anticipate non-performance by any of its counterparties and has no 
reserves related to non-performance as of September 30, 1997; TMCC has not 
experienced any counterparty default during the three years ended 
September 30, 1997.

Changes in interest rates may impact TMCC's future weighted average interest 
rate on outstanding debt as a result of floating rate liabilities.  As of 
September 30, 1997, an interest rate increase of 1% (100 basis points) would 
raise TMCC's weighted average interest rate, including the effects of interest 
rate swap agreements and option-based products, by .58%, from 5.72% to an 
estimated 6.30%.  Conversely, an interest rate decrease of 1% (100 basis 
points) would lower TMCC's weighted average interest rate, including the 
effects of interest rate swap agreements and option-based products, by .77%, 
from 5.72% to an estimated 4.95% at September 30, 1997.

TMCC uses a value-at-risk methodology, in connection with other management 
tools, to assess and manage the interest rate risk of aggregated loan and 
lease assets and financial liabilities, including interest rate derivatives 
and option-based products.  Value-at-risk represents the potential losses for 
a portfolio from adverse changes in market factors for a specified period of 
time and likelihood of occurrence (i.e. level of confidence).  TMCC's value-
at-risk methodology incorporates the impact from adverse changes in market 
interest rates but does not incorporate any impact from other market changes, 
such as foreign currency exchange rates or commodity prices, which do not 
affect the value of TMCC's portfolio.  The methodology assumes that changes in 
interest rates are lognormally distributed.  For options and instruments with 
non-linear returns, the model uses the Black Scholes method to approximate 
changes in fair value. The value-at-risk methodology excludes changes in fair 
values related to investments in marketable securities as these amounts are 
not significant.  TMCC estimates value-at-risk using historical interest rate 
volatilities for the past two years and a stratified random sampling 
methodology.

                                      -19-

<PAGE>
The value at risk of TMCC's portfolio as of September 30, 1997, measured as 
the potential 30 day loss in fair value from assumed adverse changes in 
interest rates is as follows:

<TABLE>
<CAPTION>

                                                  As of
                                            September 30, 1997
                                            ------------------
<S>                                         <C>
Mean portfolio value......................  $3,640.0 million
Value at risk.............................     $51.8 million
Percentage of the mean portfolio value....       1.4%
Confidence level..........................      95.0%
</TABLE>

TMCC's calculated value-at-risk exposure represents an estimate of reasonably 
possible net losses that would be recognized on its portfolio of financial 
instruments assuming hypothetical movements in future market rates and is not 
necessarily indicative of actual results which may occur.  It does not 
represent the maximum possible loss nor any expected loss that may occur, 
since actual future gains and losses will differ from those estimated, based 
upon actual fluctuations in market rates, operating exposures, and the timing 
thereof, and changes in the composition of TMCC's portfolio of financial 
instruments during the year.

On occasion, TMS has made equity contributions to maintain TMCC's equity 
capitalization at certain levels.  No equity contributions were made during 
fiscal 1997.  Also, on occasion, TMS makes interest-bearing loans to TMCC.  
There were no loans from TMS during fiscal 1997.

TMCC's ratio of earnings to fixed charges was 1.31, 1.32 and 1.42 in the years 
ended September 30, 1997, 1996, and 1995, respectively.  The decline in the 
ratio from 1995 levels reflects increased interest expense corresponding with 
higher debt levels to support earning asset growth.  Additionally, earnings 
have declined from 1995 levels due to higher vehicle disposition losses on 
off-lease vehicles, higher credit losses and increased operating expenses 
attributable to TMCC's growing customer base.  TMCC management does not 
believe that the declining ratio of earnings to fixed charges is indicative of 
a material decline in the liquidity of the Company.

Cash flows provided by operating, investing and financing activities have been 
used primarily to support earning asset growth.  Cash provided by the 
liquidation of earning assets, totaling $15.6 billion and $13.6 billion during 
fiscal 1997 and 1996, respectively, was used to purchase additional 
investments in operating leases and finance receivables, totaling 
$19.9 billion and $19.2 billion during fiscal 1997 and 1996, respectively. 
Investing activities resulted in a net use of cash of $2.3 billion and 
$4.8 billion in fiscal 1997 and 1996, respectively, as the purchase of 
additional earning assets, primarily investments in operating leases, exceeded 
cash provided by the liquidation of earning assets.  Net cash provided by 
operating activities totaled $2.0 billion and $2.3 billion during fiscal 1997 
and 1996, respectively, and net cash provided by financing activities totaled 
$0.3 billion and $2.6 billion, during fiscal 1997 and 1996, respectively.  The 
Company believes that cash provided by operating and investing activities as 
well as access to domestic and international capital markets, the issuance of 
commercial paper and asset-backed securitization transactions will provide 
sufficient liquidity to meet its future funding requirements.

                                      -20-

<PAGE>
Year 2000 Computer Issue
------------------------

Several of the computer systems and software packages currently used by TMCC 
will not function properly in the year 2000 without modification; potential 
year 2000 malfunctions include erroneous system calculations and/or complete 
system failure.  The Company has developed an action plan to utilize both 
internal resources and outside contractors to perform the necessary system and 
program modifications.  The Company expects to substantially resolve year 2000 
issues in fiscal year 1998 and 1999 and does not anticipate any related 
business interruptions.


Cautionary Statement for Purposes of the "Safe Harbor" Provisions of the 
Private Securities Litigation Reform Act of 1995

The foregoing Business description and Management's Discussion and Analysis 
contain various "forward looking statements" within the meaning of Section 27A 
of the Securities Act of 1933, as amended, and Section 21E of the Securities 
Exchange Act of 1934, as amended, which represent the Company's expectations 
or beliefs concerning future events, including the following: that the Company 
considers its employee relations to be good; that the lease earning assets on 
the Company's books are recorded at net realizable value; that allowances for 
credit losses are considered adequate to cover expected credit losses; that 
the ultimate liability resulting from pending claims and actions should not 
have a material adverse effect on the Company's consolidated financial 
position or results of operations; that TMCC anticipates continued growth in 
operating expenses associated with portfolio growth, expanded customer service 
activities and computer system and software modifications to address year 2000 
issues; that the Company expects to substantially resolve year 2000 issues in 
fiscal year 1998 and 1999 and does not anticipate any related business 
interruptions; that the number and principal amount of leases purchased by the 
Toyota Lease Trust will comprise a significant and increasing percentage of 
what otherwise would have been TMCC's lease portfolio; that the purchase of 
leases by the Titling Trust is expected to cause a shift in the composition of 
earning assets from operating leases to finance receivables, resulting in 
increased revenues from finance leases (until such interests in leases are 
sold in securitization transactions) and reduced operating lease revenues and 
depreciation expense; that the Company does not currently anticipate non-
performance by any of its counterparties; that TMCC anticipates the continued 
use of the Titling Trust in connection with securitization transactions; the 
Company's continued use of MTNs in the United States and the international 
capital markets; that the declining ratio of earnings to fixed charges is not 
indicative of a material decline in the liquidity of the Company; that cash 
provided by operating and investing activities as well as access to domestic 
and international capital markets, the issuance of commercial paper and asset-
backed securitization transactions will provide sufficient liquidity to meet 
the Company's future funding requirements.

                                      -21-

<PAGE>
The Company cautions that these statements are further qualified by important 
factors that could cause actual results to differ materially from those in the 
forward looking statements, including, without limitation, the following:  
decline in demand for Toyota and Lexus products; the effect of economic 
conditions; a decline in the market acceptability of leasing; the effect of 
competitive pricing on interest margins; increases in prevailing interest 
rates; changes in pricing due to the appreciation of the Japanese yen against 
the United States dollar; the effect of governmental actions; the effect of 
competitive pressures on the used car market and residual values; the 
continuation of, and if continued, the level and type of special programs 
offered by TMS; the ability of the Company to successfully access the United 
States and international capital markets; the failure of the Company's action 
plan to resolve timely year 2000 issues due to non-performance by outside 
contractors or other factors; increased costs associated with the Company's 
debt funding efforts; with respect to the effects of litigation matters, the 
discovery of facts not presently known to the Company or determination by 
judges, juries or other finders of fact which do not accord with the Company's 
evaluation of the possible liability from existing litigation; and the ability 
of the Company's counterparties to perform under interest rate and cross 
currency swap agreements.  Results actually achieved thus may differ 
materially from expected results included in these statements.

New Accounting Standards

In June 1997, the Financial Accounting Standards Board ("FASB") issued SFAS 
No. 130, "Reporting Comprehensive Income", effective for fiscal years 
beginning after December 15, 1997.  SFAS No. 130 requires that all components 
of comprehensive income be reported in a financial statement that is displayed 
with the same prominence as other financial statements as well as separate 
disclosure of other components of comprehensive income in the equity section 
of the balance sheet.  The Company has not determined the impact that adoption 
of this standard will have on its consolidated financial statement 
disclosures.  The Company plans to adopt this accounting standard by 
October 1, 1998, as required.

In June 1997, the FASB issued SFAS No. 131, "Disclosures about Segments of an 
Enterprise and Related Information", effective for fiscal years beginning 
after December 15, 1997.  SFAS No. 131 establishes standards for reporting 
information about operating segments in annual financial statements and 
requires selected information about operating segments in interim financial 
reports.  It also establishes standards for related disclosures about products 
and services, major customers and geographic areas.  The Company has not 
determined the impact that adoption of this standard will have on its 
consolidated financial statement disclosures.  The Company plans to adopt this 
accounting standard by October 1, 1998, as required.

                                      -22-

<PAGE>
ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

                INDEX TO FINANCIAL STATEMENTS 



                                                                     Page
                                                                    -------

Report of Independent Accountants................................     24

Consolidated Balance Sheet at September 30, 1997 and 1996........     25

Consolidated Statement of Income for the
   years ended September 30, 1997, 1996 and 1995.................     26

Consolidated Statement of Shareholder's Equity for
   the years ended September 30, 1997, 1996 and 1995.............     27

Consolidated Statement of Cash Flows for the
   years ended September 30, 1997, 1996 and 1995.................     28

Notes to Consolidated Financial Statements.......................   29-55







All schedules have been omitted because they are not required, not applicable, 
or the information has been included elsewhere.

                                      -23-

<PAGE>
                     REPORT OF INDEPENDENT ACCOUNTANTS
                     ---------------------------------








To the Board of Directors and Shareholder of
Toyota Motor Credit Corporation




In our opinion, the accompanying consolidated balance sheet and the related 
consolidated statements of income, of shareholder's equity and of cash flows 
present fairly, in all material respects, the financial position of Toyota 
Motor Credit Corporation (a wholly-owned subsidiary of Toyota Motor Sales, 
U.S.A., Inc.) and its subsidiaries at September 30, 1997 and 1996, and the 
results of their operations and their cash flows for each of the three years 
in the period ended September 30, 1997, in conformity with generally accepted 
accounting principles.  These financial statements are the responsibility of 
Toyota Motor Credit Corporation's management; our responsibility is to express 
an opinion on these financial statements based on our audits.  We conducted 
our audits of these statements in accordance with generally accepted auditing 
standards which require that we plan and perform the audit to obtain 
reasonable assurance about whether the financial statements are free of 
material misstatement.  An audit includes examining, on a test basis, evidence 
supporting the amounts and disclosures in the financial statements, assessing 
the accounting principles used and significant estimates made by management, 
and evaluating the overall financial statement presentation.  We believe that 
our audits provide a reasonable basis for the opinion expressed above.



/S/ PRICE WATERHOUSE LLP


Los Angeles, California
October 31, 1997

                                      -24-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                        CONSOLIDATED BALANCE SHEET
                          (Dollars in Millions)

<TABLE>
<CAPTION>
                                                       September 30,
                                                  -----------------------
                                                    1997           1996
                                                  --------       --------
<S>                                               <C>            <C>
               ASSETS
               ------

Cash and cash equivalents.................         $   177        $   170
Investments in marketable securities......             305            355
Investments in operating leases, net......          10,257         10,831
Finance receivables, net..................           8,452          7,474
Receivable from Parent....................             112             78
Other receivables.........................             137            164
Deferred charges..........................             164            131
Other assets..............................             183            106
Income taxes receivable...................              43              -
                                                   -------        -------

         Total Assets.....................         $19,830        $19,309
                                                   =======        =======

   LIABILITIES AND SHAREHOLDER'S EQUITY
   ------------------------------------

Notes and loans payable...................         $14,745        $15,014
Accrued interest..........................             213            226
Accounts payable and accrued expenses.....           1,072            474
Deposits..................................             248            248
Income taxes payable......................               -             16
Deferred income...........................             517            612
Deferred income taxes.....................             954            805
                                                   -------        -------
      Total Liabilities...................          17,749         17,395
                                                   -------        -------
Commitments and Contingencies

Shareholder's Equity: 
   Capital stock, $l0,000 par value
      (100,000 shares authorized; issued
      and outstanding 91,500 in 1997 and 
      1996)...............................             915            915
   Retained earnings......................           1,159            997
   Net unrealized gains on marketable
      securities..........................               7              2
                                                   -------        -------
      Total Shareholder's Equity..........           2,081          1,914
                                                   -------        -------
         Total Liabilities and
         Shareholder's Equity.............         $19,830        $19,309
                                                   =======        =======
</TABLE>

See Accompanying Notes to Consolidated Financial Statements.

                                      -25-

<PAGE>
                        TOYOTA MOTOR CREDIT CORPORATION
                       CONSOLIDATED STATEMENT OF INCOME
                            (Dollars in Millions)

<TABLE>
<CAPTION>
                                                  Years ended September 30,
                                                ----------------------------
                                                 1997       1996       1995
                                                ------     ------     ------
<S>                                             <C>        <C>        <C>
Financing Revenues:

   Leasing.................................     $2,739     $2,454     $1,902
   Retail financing........................        446        415        431
   Wholesale and other dealer financing....         89        109        121
                                                ------     ------     ------

Total financing revenues...................      3,274      2,978      2,454

   Depreciation on leases..................      1,790      1,626      1,230
   Interest expense........................        918        820        716
                                                ------     ------     ------
Net financing revenues.....................        566        532        508

Other revenues.............................        176        136        113
                                                ------     ------     ------
Net financing revenues and other revenues..        742        668        621
                                                ------     ------     ------
Expenses:

   Operating and administrative............        323        293        255
   Provision for credit losses.............        136        115         66
                                                ------     ------     ------

Total expenses.............................        459        408        321
                                                ------     ------     ------

Income before income taxes.................        283        260        300

Provision for income taxes.................        121        108        117
                                                ------     ------     ------

Net Income.................................     $  162     $  152     $  183
                                                ======     ======     ======
</TABLE>





See Accompanying Notes to Consolidated Financial Statements.

                                      -26-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
               CONSOLIDATED STATEMENT OF SHAREHOLDER'S EQUITY
                            (Dollars in Millions)

<TABLE>
<CAPTION>
                                                        Net
                                  Capital  Retained  Unrealized
                                   Stock   Earnings  Gain/(Loss)  Total
                                  -------  --------  ----------  -------
<S>                               <C>      <C>       <C>         <C>

Balance at September 30, l994...   $  865   $   662   $       -   $1,527


Net income in 1995..............        -       183           -      183

Change in net unrealized gain
   on available-for-sale
   marketable securities........        -         -          (1)      (1)
                                   ------  --------   ---------  -------

Balance at September 30, 1995...      865       845          (1)   1,709

Issuance of capital stock.......       50         -           -       50

Net income in 1996..............        -       152           -      152

Change in net unrealized gain
   on available-for-sale
   marketable securities........        -         -           3        3
                                   ------  -------    ---------  -------

Balance at September 30, 1996...      915      997            2    1,914

Net income in 1997..............        -      162            -      162

Change in net unrealized gain
   on available-for-sale
   marketable securities........        -        -            5        5
                                   ------  -------    ---------  -------

Balance at September 30, 1997...   $  915   $1,159    $       7   $2,081
                                   ======   ======    =========  =======
</TABLE>




See Accompanying Notes to Consolidated Financial Statements.

                                      -27-

<PAGE>
                               TOYOTA MOTOR CREDIT CORPORATION
                             CONSOLIDATED STATEMENT OF CASH FLOWS
                                    (Dollars in Millions)
<TABLE>
<CAPTION>
                                                              Years ended September 30,
                                                          ---------------------------------
                                                           1997         1996          1995
                                                          ------       ------        ------
<S>                                                       <C>          <C>           <C>
Cash flows from operating activities:

   Net income..........................................   $  162       $  152        $  183
                                                          ------       ------        ------
   Adjustments to reconcile net income to net 
      cash provided by operating activities:
        Depreciation and amortization..................    1,835        1,646         1,286
        Provision for credit losses....................      136          115            66
        Gain from sale of finance receivables, net.....      (23)         (15)          (11)
        (Decrease) increase in accrued interest........      (13)          36            34
        Increase in deferred income taxes..............      149          178           241
        (Increase) decrease in other assets............     (198)         (59)          114
        (Decrease) increase in other liabilities.......      (74)         220            99
                                                          ------       ------        ------
   Total adjustments...................................    1,812        2,121         1,829
                                                          ------       ------        ------

Net cash provided by operating activities..............    1,974        2,273         2,012
                                                          ------       ------        ------

Cash flows from investing activities:

   Addition to investments in marketable 
      securities.......................................     (581)        (222)         (116)
   Disposition of investments in marketable
      securities.......................................      638           68            33
   Addition to investments in operating leases.........   (4,269)      (6,081)       (4,123)
   Disposition of investments in operating leases......    3,044        1,718           927
   Purchase of finance receivables.....................  (15,595)     (13,136)      (11,005)
   Liquidation of finance receivables..................   12,553       11,938        10,913
   Proceeds from sale of finance receivables...........    1,956          905           650
                                                          ------       ------        ------

Net cash used in investing activities..................   (2,254)      (4,810)       (2,721)
                                                          ------       ------        ------
Cash flows from financing activities:

   Proceeds from issuance of capital stock.............        -           50             -
   Proceeds from issuance of notes and loans payable...    5,482        5,894         5,733
   Payments on notes and loans payable.................   (4,510)      (4,587)       (4,989)
   Net (decrease) increase  in commercial paper,
      with original maturities less than 90 days.......     (685)       1,249           (62)
                                                          ------       ------        ------

Net cash provided by financing activities..............      287        2,606           682
                                                          ------       ------        ------

Net increase (decrease) in cash and cash equivalents...        7           69           (27)

Cash and cash equivalents at the beginning
   of the period.......................................      170          101           128
                                                          ------       ------        ------

Cash and cash equivalents at the end of the 
   period..............................................   $  177       $  170        $  101
                                                          ======       ======        ======
Supplemental disclosures:

   Interest paid.......................................     $906         $778          $643
   Income taxes paid...................................       $5           $3            $2

</TABLE>


See Accompanying Notes to Consolidated Financial Statements.

                                      -28-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1 - Nature of Operations
-----------------------------

Toyota Motor Credit Corporation ("TMCC") provides retail and wholesale 
financing, retail leasing and certain other financial services to authorized 
Toyota and Lexus vehicle and Toyota industrial equipment dealers and their 
customers in the United States (excluding Hawaii) and Puerto Rico.  TMCC is a 
wholly-owned subsidiary of Toyota Motor Sales, U.S.A., Inc. ("TMS" or the 
"Parent").  TMS is primarily engaged in the wholesale distribution of 
automobiles, trucks, industrial equipment and related replacement parts and 
accessories throughout the United States (excluding Hawaii).  Substantially 
all of TMS's products are purchased from Toyota Motor Corporation ("TMC") or 
its affiliates.  TMC restructured its North American organizations with the 
establishment of Toyota Motor Manufacturing North America, Inc. ("TMMNA") on 
October 1, 1996.  TMMNA functions to coordinate and support numerous 
manufacturing related administrative functions previously carried out 
independently by various Toyota entities in North America and by TMC in Japan. 
Both TMMNA and TMS are wholly-owned subsidiaries of Toyota Motor North 
America, Inc., a holding company owned 100% by TMC.

TMCC has seven wholly-owned subsidiaries, Toyota Motor Insurance Services, 
Inc. ("TMIS"), Toyota Motor Insurance Corporation of Vermont ("TMICV"), Toyota 
Motor Insurance Company ("TMIC"), Toyota Motor Life Insurance Company 
("TLIC"), Toyota Motor Credit Receivables Corporation ("TMCRC"), Toyota 
Leasing, Inc. ("TLI") and Toyota Credit De Puerto Rico Corp. ("TCPR").  TMCC 
and its wholly-owned subsidiaries are collectively referred to as the 
"Company".  The insurance subsidiaries provide certain insurance services 
along with certain insurance and contractual coverages in connection with the 
sale and lease of vehicles.  In addition, the insurance subsidiaries insure 
and reinsure certain TMS and TMCC risks.  TMCRC, a limited purpose subsidiary, 
operates primarily to acquire retail finance receivables from TMCC for the 
purpose of securitizing such receivables.  TLI, a limited purpose subsidiary, 
was formed in April 1997 primarily to acquire lease finance receivables from 
TMCC for the purpose of securitizing such leases.  TCPR was established in 
January 1996 to provide retail and wholesale financing and certain other 
financial services to authorized Toyota and Lexus vehicle dealers and their 
customers in Puerto Rico; TCPR commenced operations in October 1996.

The Company's business is substantially dependent upon the sale of Toyota and 
Lexus vehicles in the United States.  Changes in the volume of sales of such 
vehicles resulting from governmental action, changes in consumer demand, 
changes in pricing of imported units due to currency fluctuations, or other 
events could impact the level of finance and insurance operations of the 
Company.

                                      -29-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 2 - Summary of Significant Accounting Policies
---------------------------------------------------
     
      Use of Estimates
      ----------------

The preparation of financial statements in conformity with generally accepted 
accounting principles requires management to make estimates and assumptions 
that affect the reported amounts of assets and liabilities and disclosure of 
contingent assets and liabilities at the date of the financial statements and 
the reported amounts of revenues and expenses during the reporting period.  
Actual results could differ from those estimates.

      Principles of Consolidation
      ---------------------------

The consolidated financial statements include the accounts of TMCC and its 
wholly-owned subsidiaries.  All significant intercompany transactions and 
balances have been eliminated.

      Revenue Recognition
      -------------------

Revenue from retail financing contracts and finance leases is recognized using 
the effective yield method.  Revenue from operating leases is recognized on a 
straight-line basis over the lease term.

      Cash and Cash Equivalents
      -------------------------

Cash equivalents, consisting primarily of money market instruments and debt 
securities, represent highly liquid investments with original maturities of 
three months or less.

      Investments in Marketable Securities
      ------------------------------------

Investments in marketable securities consist of debt and equity securities.  
Debt securities designated as held-to-maturity are carried at amortized cost 
and are reduced to net realizable value for other than temporary declines in 
market value.  Debt and equity securities designated as available-for-sale are 
carried at fair value with unrealized gains or losses included in 
shareholder's equity, net of applicable taxes.  Realized investment gains and 
losses, which are determined on the specific identification method, are 
reflected in income.

                                      -30-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 2 - Summary of Significant Accounting Policies (Continued)
---------------------------------------------------

      Investments in Operating Leases
      -------------------------------

TMCC acquires retail leases from Toyota and Lexus vehicle and Toyota 
industrial equipment dealers.  Investments in operating leases are recorded at 
cost and depreciated, primarily on a straight-line basis, over the lease term 
to the estimated residual value.  Gains or losses on disposal and adjustments 
to the residual value of underlying assets are also included in depreciation 
expense.

      Allowance for Credit Losses
      ---------------------------

Allowances for credit losses are established during the period in which 
receivables are acquired and are maintained in amounts considered by 
management to be appropriate in relation to receivables outstanding based upon 
historical loss experience and other factors.  Losses are charged to the 
allowance for credit losses when it has been determined that collateral cannot 
be recovered and any shortfall between proceeds received and the carrying cost 
of repossessed collateral is charged to the allowance.  Recoveries are 
credited to the allowance for credit losses.

     Allowance for Residual Value Losses
     -----------------------------------

Allowances for estimated losses on lease vehicles returned to TMCC for 
disposition at lease termination are established based upon projected vehicle 
return rates and projected residual value losses on core models derived from 
available historical and market information as well as general economic 
factors.  The provision for residual value losses is included in depreciation 
expense for operating leases and in leasing revenues for direct finance 
leases.  Effective January 1997, and at each subsequent quarter end, TMCC 
reevaluated amounts provided for its allowance for estimated residual value 
losses based on recent vehicle return rates and loss experience which resulted 
in increased depreciation expense of $9.7 million and decreased leasing 
revenues of $2.4 million for a combined decrease in net financing revenues of 
$12.1 million for the nine months ended September 30, 1997.

      Deferred Charges
      ----------------

Deferred charges consist primarily of premiums paid for option-based products, 
underwriters' commissions and other debt issuance costs  which are amortized 
to interest expense over the life of the related instruments on a straight-
line basis.

                                      -31-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 2 - Summary of Significant Accounting Policies (Continued)
---------------------------------------------------

      Insurance Operations
      --------------------

Revenues from insurance premiums and from providing coverage under various 
contractual agreements are earned over the terms of the respective policies 
and agreements in proportion to estimated claims activity.  Certain costs of 
acquiring new business, consisting primarily of commissions and premium taxes, 
are deferred and amortized over the terms of the related policies on the same 
basis as revenues are earned.  The liability for reported losses and the 
estimate of unreported losses are recorded in accounts payable and accrued 
expenses.  Commission and fee income are recognized in relation to the level 
of services performed.

     Derivative Financial Instruments
     --------------------------------

TMCC uses a variety of derivative financial instruments to manage funding 
costs and risks associated with changes in interest and foreign currency 
exchange rates.  The derivative instruments used include interest rate, cross 
currency interest rate and indexed note swap agreements and option-based 
products.  TMCC does not use any of these instruments for trading purposes.  
The derivative financial instruments are specifically designated to the 
underlying debt obligations or to portfolio level risks.  Cash flows related 
to these instruments are classified in the same categories as cash flows from 
related borrowing activities.

          Interest Rate Swap Agreements
          -----------------------------
Interest rate swap agreements are executed as an integral part of specific 
debt transactions or on a portfolio basis.  The differential paid or received 
on interest rate swap agreements is recorded on an accrual basis as an 
adjustment to interest expense over the term of the agreements.

          Cross Currency Interest Rate Swap Agreements
          --------------------------------------------
Cross currency interest rate swap agreements are executed as an integral part 
of foreign currency debt transactions.  The differential between the contract 
rates and the foreign currency spot exchange rates as of the reporting dates 
is classified in other receivables or accounts payable and accrued expenses; 
the differential paid or received on the interest rate swap portion of the 
agreements is recorded on an accrual basis as an adjustment to interest 
expense over the term of the agreements.

          Indexed Note Swap Agreements
          ----------------------------
Indexed note swap agreements are executed as an integral part of indexed note 
transactions.  Any differential between contract rates and foreign currency 
spot exchange rates as of the reporting dates is classified in other 
receivables or accounts payable and accrued expenses; the interest 
differential paid or received on indexed note swap agreements is recorded on 
an accrual basis as an adjustment to interest expense over the term of the 
agreements.

          Option-Based Products
          ---------------------
Option-based products are executed on a portfolio basis.  Premiums paid for 
option-based products are included in deferred charges and are amortized to 
interest expense over the life of the instruments on a straight-line basis.  
Amounts receivable under option-based products are recorded on an accrual 
basis as a reduction to interest expense.

                                      -32-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 2 - Summary of Significant Accounting Policies (Continued)
---------------------------------------------------

     Income Taxes
     ------------

TMCC uses the liability method of accounting for income taxes under which 
deferred tax assets and liabilities are adjusted to reflect changes in tax 
rates and laws in the period such changes are enacted resulting in adjustments 
to the current period's provision for income taxes.

The Company joins with TMS in filing consolidated federal income tax returns 
and combined or consolidated income tax returns in certain states.  Federal 
and state income tax expense is generally recognized as if the Company filed 
its tax returns on a stand alone basis.  In those states where TMCC joins in 
the filing of consolidated or combined income tax returns, TMCC is allocated 
its share of the total income tax expense based on the Company's income or 
loss which would be allocable to such states if the Company filed separate 
returns.  Based on an informal tax sharing agreement with TMS and other 
members of the TMS group, the Company pays TMS for its share of the 
consolidated federal and consolidated or combined state income tax expense and 
is reimbursed for the benefit of any of its tax basis losses utilized in the 
consolidated federal and consolidated or combined state income tax returns.

     Reclassifications
     -----------------

Certain 1996 and 1995 amounts have been reclassified to conform with the 1997 
presentation.

                                      -33-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 3 - Investments in Marketable Securities
---------------------------------------------

TMCC records its investments in marketable securities which are designated as 
available-for-sale at fair value estimated using quoted market prices or 
discounted cash flow analysis.  Unrealized gains, net of income taxes, related 
to available-for-sale securities are included as a separate component of 
shareholder's equity.  Securities designated as held-to-maturity are recorded 
at amortized cost.

The estimated fair value and amortized cost of investments in marketable 
securities are as follows:

<TABLE>
<CAPTION>
                                                September 30, 1997
                                            ---------------------------
                                                                Gross
                                                    Fair     Unrealized
                                            Cost    Value       Gains
                                            ----    -----    ----------
                                               (Dollars in Millions)
<S>                                         <C>     <C>      <C>
Available-for-sale securities:
   Equity securities...................     $ 50     $ 58           $ 8
   Asset-backed securities.............      161      164             3
   U.S. debt securities................       46       46             -
   Corporate debt securities...........       21       21             -
                                            ----     ----           ---
Total available-for-sale securities....     $278     $289           $11
                                                                    ===
Held-to-maturity securities:
   U.S. debt securities................       16       16
                                            ----     ----
Total marketable securities............     $294     $305
                                            ====     ====
</TABLE>

<TABLE>
<CAPTION>
                                                September 30, 1996
                                            ---------------------------
                                                                Gross
                                                    Fair     Unrealized
                                            Cost    Value       Gains
                                            ----    -----    ----------
                                               (Dollars in Millions)
<S>                                         <C>     <C>      <C>
Available-for-sale securities:
   Equity securities...................     $133     $135           $ 2
   Asset-backed securities.............      206      207             1
   U.S. debt securities................        2        2             -
                                            ----     ----           ---
Total available-for-sale securities....     $341     $344           $ 3
                                                                    ===
Held-to-maturity securities:
   U.S. debt securities................       11       11
                                            ----     ----
Total marketable securities............     $352     $355
                                            ====     ====
</TABLE>

                                      -34-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 3 - Investments in Marketable Securities (Continued)
---------------------------------------------

The contractual maturities of investments in marketable securities at 
September 30, 1997 are as follows:

<TABLE>
<CAPTION>
                                       Available-for-Sale    Held-to-Maturity
                                          Securities            Securities
                                       ------------------    ----------------
                                                    Fair                Fair 
                                       Cost         Value    Cost       Value 
                                       ----         -----    ----       -----
                                                  (Dollars in Millions)
<S>                                    <C>          <C>      <C>        <C>
Within one year......................  $  -          $  -    $ 12       $  12
After one year through five years....    21            21       4           4
After five years through ten years...    29            29       -           -
After ten years......................    17            17       -           -
Mutual funds.........................    50            58       -           -
Asset-backed securities..............   161           164       -           -
                                       ----          ----     ---         ---
   Total.............................  $278          $289    $ 16       $  16
                                       ====          ====    ====       =====
</TABLE>

The proceeds from sales of available-for-sale securities were $416 million and 
$3 million for the years ended September 30, 1997 and 1996, respectively.  
Realized gains and losses on sales of available-for-sale securities were 
$5 million and $2 million, respectively, for the year ended September 30, 
1997, and were immaterial for the years ended September 30, 1996 and 1995.

                                      -35-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 4 - Investments in Operating Leases
----------------------------------------

      Investments in operating leases, net consisted of the following:
      <TABLE>
      <CAPTION>
                                                         September 30,
                                                    ----------------------
                                                     1997            1996
                                                    -------        -------
                                                     (Dollars in Millions)
      <S>                                           <C>            <C>
      Vehicles.................................     $12,557        $13,252
      Equipment and other......................         338            268
                                                    -------        -------
                                                     12,895         13,520
      Accumulated depreciation.................      (2,535)        (2,582)
      Allowance for credit losses..............        (103)          (107)
                                                    -------        -------
         Investments in operating leases, net..     $10,257        $10,831
                                                    =======        =======
      </TABLE>

Rental income from operating leases was $2,568 million, $2,292 million and 
$1,734 million for the years ended September 30, 1997, 1996 and 1995, 
respectively.  Future minimum rentals on operating leases for each of the five 
succeeding years ending September 30, are:  1998 - $1,873 million; 1999 - 
$1,114 million; 2000 - $366 million; 2001 - $42 million; and 2002 - 
$4 million.  A substantial portion of TMCC's operating lease contracts have 
historically been terminated prior to maturity; future minimum rentals as 
shown above should not be considered as necessarily indicative of future cash 
collections.

Note 5 - Finance Receivables
----------------------------

Finance receivables, net consisted of the following:
<TABLE>
<CAPTION>
                                                         September 30,
                                                     ---------------------
                                                      1997           1996
                                                     ------         ------
                                                     (Dollars in Millions)
      <S>                                            <C>            <C>
      Retail...............................          $6,315         $5,501
      Finance leases.......................           1,938          1,536
      Wholesale and other dealer loans.....             885          1,015
                                                     ------         ------
                                                      9,138          8,052
      Unearned income......................            (576)          (482)
      Allowance for credit losses..........            (110)           (96)
                                                     ------         ------
         Finance receivables, net..........          $8,452         $7,474
                                                     ======         ======
      </TABLE>

                                      -36-

<PAGE>
                       TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 5 - Finance Receivables (Continued)
----------------------------

Contractual maturities are as follows:
<TABLE>
<CAPTION>
       Due in the                                    Wholesale
      Years Ending                                   and Other
      September 30,                   Retail        Dealer Loans
      -------------                   ------        ------------
                                        (Dollars in Millions)
      <S>                             <C>           <C>
      1998..................          $1,907              $  671
      1999..................           1,639                  37
      2000..................           1,443                  54
      2001..................             949                  61
      2002..................             358                  50
      Thereafter............              19                  12
                                      ------              ------
         Total..............          $6,315              $  885
                                      ======              ======
</TABLE>

Finance leases, net consisted of the following:
<TABLE>
<CAPTION>
                                                          September 30,
                                                      ---------------------
                                                       1997           1996
                                                      ------         ------
                                                      (Dollars in Millions)
      <S>                                             <C>            <C>
      Minimum lease payments..................        $1,260         $  878
      Estimated unguaranteed residual values..           678            658
                                                      ------         ------
         Finance leases.......................         1,938          1,536
      Unearned income.........................          (336)          (270)
      Allowance for credit losses.............           (24)           (19)
                                                      ------         ------
         Finance leases, net..................        $1,578         $1,247
                                                      ======         ======
</TABLE>

The aggregate balances related to finance receivables 60 or more days past due 
totaled $17 million and $20 million at September 30, 1997 and 1996, 
respectively.  Future minimum finance lease payments for each of the five 
succeeding years ending September 30, are:  1998 - $374 million; 1999 - 
$329 million; 2000 - $305 million; 2001 - $174 million and 2002 - $78 million. 
A substantial portion of TMCC's finance receivables have historically been 
repaid prior to contractual maturity dates; contractual maturities and future 
minimum lease payments as shown above should not be considered as necessarily 
indicative of future cash collections.  The majority of retail and finance 
lease receivables do not involve recourse to the dealer in the event of 
customer default.

                                      -37-

<PAGE>
                       TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 6 - Allowance for Credit Losses
------------------------------------

     An analysis of the allowance for credit losses follows:
     <TABLE>
     <CAPTION>
                                                    Years ended September 30,
                                                   --------------------------
                                                   1997       1996       1995
                                                   ----       ----       ----
                                                     (Dollars in Millions)
     <S>                                           <C>          <C>      <C>
     Allowance for credit losses
        at beginning of period...........          $203       $171       $164
     Provision for credit losses.........           136        115         66
     Charge-offs.........................          (116)       (81)       (63)
     Recoveries..........................            12         12         12
     Other adjustments...................           (22)       (14)        (8)
                                                   ----       ----       ----

     Allowance for credit losses
        at end of period.................          $213       $203       $171
                                                   ====       ====       ====
     </TABLE>


Note 7 - Sale of Retail Receivables and Interests in Lease Finance Receivables
------------------------------------------------------------------------------

Effective January 1, 1997, TMCC adopted Statement of Financial Accounting 
Standards ("SFAS") No. 125, "Accounting for Transfers and Servicing of 
Financial Assets and Extinguishments of Liabilities."  SFAS No. 125 addresses 
the accounting for transfers and servicing of financial assets and 
extinguishments of liabilities occurring after December 31, 1996 and the 
accounting for and classification of previously recognized excess servicing 
assets.  In accordance with the requirements of this statement, the Company 
has reclassified its previously recognized excess servicing receivables from 
other receivables to investments in marketable securities for all balance 
sheet periods presented.

In April 1997, and July 1996, TMCC sold retail finance receivables totaling 
$784 million and $782 million, respectively, to TMCRC which in turn sold them 
to a trust; TMCC continues to act as servicer and is paid a servicing fee.  
TMCC holds an undivided trust interest ("UTI") in leases held in a titling 
trust established by TMCC. In September 1997, TMCC identified certain leases 
included in the UTI to be allocated to a separate portfolio represented by a 
special unit of beneficial interest ("SUBI") totaling $1,283 million and sold 
the SUBI to TLI.  TLI in turn contributed substantially all of the SUBI to a 
trust; TMCC continues to act as servicer for all assets represented by the UTI 
and the SUBI and is paid a servicing fee.  TMCRC and TLI retain subordinated 
interests in the excess cash flows of these transactions, certain cash 
deposits and other related amounts which are held as restricted assets subject 
to limited recourse provisions.  None of the retail finance receivables sold 
to TMCRC, the lease assets represented by the SUBI or the restricted assets 
are available to satisfy any obligations of TMCC.

                                      -38-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 7 - Sale of Retail Receivables and Interests in Lease Finance Receivables
------------------------------------------------------------------------------
        (Continued)


Following is a summary of amounts included in investment in marketable 
securities and other receivables:

<TABLE>
<CAPTION>
                                                         September 30,
                                                     ---------------------
                                                     1997             1996
                                                     ----             ----
                                                     (Dollars in Millions)
      <S>                                                                 
      Investment in marketable securities            <C>              <C>
         Excess servicing....................        $ 77             $ 35
         Allowance for estimated credit and
           residual value losses on sold
           receivables.......................         (28)              (5)
                                                     ----             ----
             Total...........................        $ 49             $ 30
                                                     ====             ====
      Other receivables
         Cash deposits.......................        $ 51             $ 20
         Undivided interest in trust.........          24                2
                                                     ----             ----
             Total...........................        $ 75             $ 22
                                                     ====             ====
</TABLE>

The pretax gain resulting from the sale of retail receivables and interests in 
lease finance receivables totaled $23 million and $15 million in fiscal 1997 
and 1996, respectively, after providing for an allowance for estimated credit 
and residual value losses.

The outstanding balance of sold retail finance receivables which TMCC 
continues to service at September 30, 1997 and 1996 totaled $1.1 billion for 
both periods.  The outstanding balance of the lease finance receivables 
represented by the sold SUBI which TMCC continues to service at September 30, 
1997 totaled $1.3 billion.

                                      -39-

<PAGE>
                     TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 8 - Transactions with Parent
---------------------------------

An operating agreement with TMS (the "Operating Agreement") provides that 100% 
ownership of TMCC will be retained by TMS as long as TMCC has any funded debt 
outstanding and that TMS will provide necessary equity contributions or other 
financial assistance it deems appropriate to ensure that TMCC maintains a 
minimum coverage on fixed charges of 1.10 times such charges in any fiscal 
quarter.  The coverage provision of the Operating Agreement is solely for the 
benefit of the holders of TMCC's commercial paper and the Operating Agreement 
may be amended or terminated at any time without notice to, or the consent of, 
holders of other TMCC obligations.  The Operating Agreement does not 
constitute a guarantee by TMS of any obligations of TMCC.

TMS provides certain technical and administrative services and incurs certain 
expenses on the Company's behalf and, accordingly, allocates these charges to 
the Company.  The charges, reimbursed by TMCC to TMS, totaled $12 million, 
$12 million and $8 million for the years ended September 30, 1997, 1996 and 
1995, respectively.  In addition, TMS sponsors special retail and lease 
programs offered by TMCC; for the years ended September 30, 1997, 1996 and 
1995, TMCC recognized revenue of $174 million, $174 million and $134 million, 
respectively, related to TMS sponsored programs.

TMCC has an arrangement to borrow and invest funds with TMS at short term 
market rates.  For the years ended September 30, 1997 and 1996, TMCC did not 
borrow from TMS.  For the year ended September 30, 1995, the highest amount of 
borrowings from TMS was $34 million; interest charges related to these 
borrowings were immaterial.  The Operating Agreement provides that borrowings 
from TMS are subordinated to all other indebtedness of TMCC.  For the years 
ended September 30, 1997, 1996 and 1995, the highest amounts of funds invested 
with TMS were $817 million, $224 million and $603 million, respectively; 
interest earned on these investments totaled $5 million, $5 million and 
$16 million for the years ended September 30, 1997, 1996 and 1995, 
respectively.

The Company leases its headquarters facility from TMS; rent expense paid to 
TMS for this facility totaled $3 million for each of the years ended 
September 30, 1997, 1996 and 1995.  TMCC leases a corporate aircraft to TMS 
and provides wholesale financing for TMS affiliates; TMCC recognized revenue 
related to these arrangements of $5 million, $3 million and $3 million for the 
years ended September 30, 1997, 1996 and 1995, respectively.

TMIS and TMICV provide certain insurance services, and insurance and 
reinsurance coverages, respectively, to TMS. Premiums, commissions and fees 
earned on these services for the years ended September 30, 1997, 1996 and 1995 
totaled $12 million, $7 million and $4 million, respectively.

                                      -40-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 9 - Notes and Loans Payable
--------------------------------

Notes and loans payable at September 30, 1997 and 1996, which consisted of 
senior debt, included the following:
<TABLE>
<CAPTION>
                                                          September 30,
                                                     ----------------------
                                                       1997           1996
                                                     -------        -------
                                                      (Dollars in Millions)
       <S>                                           <C>            <C>
       Commercial paper, net...................       $1,512        $ 2,360
                                                     -------        -------
       Other senior debt, due in the years
          ending September 30,:
             1997..............................            -          3,211
             1998..............................        2,868          2,760
             1999..............................        1,324          1,384
             2000..............................        2,505          2,137
             2001..............................        2,154          2,216
             2002..............................        2,660            491
             Thereafter........................        1,606            373
                                                     -------        -------
                                                      13,117         12,572
       Unamortized premium.....................          116             82
                                                     -------        -------
             Total other senior debt...........       13,233         12,654
                                                     -------        -------
                Notes and loans payable........      $14,745        $15,014
                                                     =======        =======
</TABLE>
Short-term borrowings include commercial paper and certain medium-term notes 
("MTNs").  The weighted average remaining term of commercial paper was 23 days 
and 31 days at September 30, 1997 and 1996, respectively.  The weighted 
average interest rate on commercial paper was 5.58% and 5.41% at September 30, 
1997 and 1996, respectively.  Short-term MTNs with original terms of one year 
or less, included in other senior debt, were $221 million and $559 million at 
September 30, 1997 and 1996, respectively.  The weighted average interest rate 
on these short-term MTNs was 5.46% and 5.19% at September 30, 1997 and 1996, 
respectively, including the effect of interest rate swap agreements.

The weighted average interest rate on other senior debt was 5.85% and 5.98% at 
September 30, 1997 and 1996, respectively, including the effect of interest 
rate swap agreements and option-based products. The rates have been calculated 
using rates in effect at September 30, 1997 and 1996, some of which are 
floating rates that reset daily.  Approximately 8% of other senior debt at 
September 30, 1997 had interest rates, including the effect of interest rate 
swap agreements, that were fixed for  a period  of more  than  one year.  The 
weighted average of these fixed interest rates was 5.89% at September 30,  
1997.  Approximately 40% of other senior debt at September 30, 1997 had 
floating interest rates that were covered by option-based products. The 
weighted average strike rate on these option-based products was 6.02% at 
September 30, 1997.  TMCC manages interest rate risk via continuous adjustment 
of the mix of fixed and floating rate debt through use of interest rate swap 
agreements and option-based products.

                                      -41-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 9 - Notes and Loans Payable (Continued)
--------------------------------

Included in notes and loans payable at September 30, 1997 and 1996 were 
unsecured notes denominated in various foreign currencies as follows:
     <TABLE>
     <CAPTION>

                                                       September 30,
                                               ------------------------------
                                                  1997                1996
                                               -----------        -----------
                                                     (Amounts in Millions)
     <S>                                       <C>                <C>
     Australian dollar...................              250                250
     British pound sterling..............              150                150
     Canadian dollar.....................              300                300
     Czech koruna........................            2,000                  -
     Danish kroner.......................              400                  -
     Dutch guilder.......................              500                555
     French franc........................            1,545              2,545
     German deutsche mark................            2,772              1,052
     Hong Kong dollar....................              150                150
     Italian lire........................          927,300            493,300
     Japanese yen........................          187,502            197,699
     Luxembourg franc....................            2,000                  -
     New Zealand dollar..................              200                100
     South African rand..................              400                250
     Swedish kronor......................              670                670
     Swiss franc.........................            1,950              1,940

     </TABLE>

Concurrent with the issuance of these unsecured notes, TMCC entered into cross 
currency interest rate swap agreements to convert these obligations at 
maturity into U.S. dollar obligations which in aggregate total a principal 
amount of $6.8 billion at September 30, 1997.  TMCC's foreign currency debt 
was translated into U.S. dollars in the financial statements at the various 
foreign currency spot exchange rates in effect at September 30, 1997.  The 
receivables or payables arising as a result of the differences between the 
September 30, 1997 foreign currency spot exchange rates and the contract rates 
applicable to the cross currency interest rate swap agreements are classified 
in other receivables or accounts payable and accrued expenses, respectively, 
and would in aggregate total a net payable position of $791 million at 
September 30, 1997.

                                      -42-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 10 - Fair Value of Financial Instruments 
---------------------------------------------

The fair value of financial instruments at September 30, 1997 and 1996, was 
estimated using the valuation methodologies described below.  Considerable 
judgement was employed in interpreting market data to develop estimates of 
fair value; accordingly, the estimates presented herein are not necessarily 
indicative of the amounts that the Company could realize in a current market 
exchange.  The use of different market assumptions or valuation methodologies 
could have a material effect on the estimated fair value amounts.

The carrying amounts and estimated fair values of the Company's financial 
instruments at September 30, 1997 and 1996 are as follows:

<TABLE>
<CAPTION>

                                                          September 30,
                                       ---------------------------------------------------
                                                1997                        1996
                                       ------------------------   ------------------------
                                        Carrying       Fair        Carrying       Fair
                                         Amount        Value        Amount        Value
                                       -----------   ----------   -----------   ----------
                                                      (Dollars in Millions)
<S>                                    <C>           <C>          <C>           <C>
Balance sheet financial 
   instruments:

Assets:

Cash and cash equivalents...........     $177           $177         $170          $170
Investments in marketable
   securities.......................     $305           $305         $355          $355
Retail finance receivables, net.....   $6,875         $6,724       $6,228        $6,121
Other receivables...................     $121           $121          $48           $49
Receivables from cross currency
   interest rate swap agreements....      $10            $20         $116          $152

Liabilities:

Notes and loans payable.............  $14,745        $15,290      $15,014       $15,398
Payables from cross currency
   interest rate swap agreements....     $801           $543         $287          $108
Other payables......................     $271           $271         $187          $187

</TABLE>

                                      -43-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 10 - Fair Value of Financial Instruments (Continued)
---------------------------------------------
<TABLE>
<CAPTION>
                                            September 30,
                           -------------------------------------------------
                                     1997                      1996
                           -----------------------  ------------------------
                           Contract or  Unrealized   Contract or  Unrealized
                            Notional      Gains/      Notional      Gains/
                             Amount      (Losses)      Amount      (Losses)
                           -----------  ----------   -----------  ----------
                                          (Dollars in Millions)
<S>                         <C>          <C>         <C>          <C>
Off-balance sheet
   financial instruments:

Cross currency interest
   rate swap agreements.....   $6,534        $(491)       $5,642         $72
Interest rate swap
   agreements...............   $6,318         $127        $6,759         $37
Option-based products.......   $5,600          $16        $6,220         $26
Indexed note swap
   agreements...............   $2,340          $(1)       $1,924        $(37)

</TABLE>

The fair value estimates presented herein are based on information available 
to management as of September 30, 1997 and 1996.  Although the Company is not 
aware of any factors that would significantly affect the estimated fair value 
amounts, such amounts have not been comprehensively reevaluated for purposes 
of these financial statements since September 30, 1997 and 1996 and, 
therefore, current estimates of fair value may differ significantly from the 
amounts presented herein.

The methods and assumptions used to estimate the fair value of financial 
instruments are summarized as follows:

      Cash and Cash Equivalents
      -------------------------

The carrying amount of cash and cash equivalents approximates market value due 
to the short maturity of these investments. 

      Investments in Marketable Securities
      ------------------------------------

The fair value of marketable securities was estimated using quoted market 
prices or discounted cash flow analysis.

      Retail Finance Receivables
      --------------------------

The carrying amounts of $800 million and $900 million of variable rate finance 
receivables at September 30, 1997 and 1996, respectively, were assumed to 
approximate fair value as these receivables reprice at prevailing market 
rates.  The fair value of fixed rate finance receivables was estimated by 
discounting expected cash flows using the rates at which loans of similar 
credit quality and maturity would be originated as of September 30, 1997 and 
1996.

                                      -44-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 10 - Fair Value of Financial Instruments (Continued)
---------------------------------------------

      Other Receivables and Other Payables
      ------------------------------------

The carrying amount and fair value of other receivables and other payables are 
presented separately from the receivables and payables arising from cross 
currency interest rate swap agreements.  The fair value of amounts associated 
with the sale of finance receivables was estimated by discounting expected 
cash flows using quoted market interest rates as of September 30, 1997 and 
1996.  The carrying amount of the remaining other receivables and payables 
approximate market value due to the short maturity of these instruments.

      Notes and Loans Payable
      -----------------------

The fair value of notes and loans payable was estimated by discounting 
expected cash flows using the interest rates at which debt of similar credit 
quality and maturity would be issued as of September 30, 1997 and 1996.  The 
carrying amount of commercial paper was assumed to approximate fair value due 
to the short maturity of these instruments.

      Cross Currency Interest Rate Swap Agreements
      --------------------------------------------

The estimated fair value of TMCC's outstanding cross currency interest rate 
swap agreements was derived by discounting expected cash flows using quoted 
market exchange rates and quoted market interest rates as of September 30, 
1997 and 1996.

      Interest Rate Swap Agreements
      -----------------------------

The estimated fair value of TMCC's outstanding interest rate swap agreements 
was derived by discounting expected cash flows using quoted market interest 
rates as of September 30, 1997 and 1996.

      Option-based Products
      -----------------------

The estimated fair value of TMCC's outstanding option-based products was 
derived by discounting expected cash flows using market exchange rates and 
market interest rates as of September 30, 1997 and 1996.

      Indexed Note Swap Agreements
      ----------------------------

The estimated fair value of TMCC's outstanding indexed note swap agreements 
was derived using quoted market prices as of September 30, 1997 and 1996.

                                      -45-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 11 - Financial Instruments with Off-Balance Sheet Risk 
-----------------------------------------------------------

Inventory Lines of Credit
-------------------------

TMCC has extended inventory floorplan lines of credit to dealers, the unused 
portion of which amounted to $1,163 million and $1,119 million at 
September 30, 1997 and 1996, respectively.  Security interests are acquired in 
vehicles and equipment financed and substantially all such financings are 
backed by corporate or individual guarantees from or on behalf of the 
participating dealers.

Derivative Financial Instruments 
--------------------------------

TMCC utilizes a variety of derivative financial instruments to manage its 
currency exchange rate risk arising as a result of borrowings denominated in 
foreign currencies and its interest rate risk as explained in this note.  TMCC 
does not enter into these arrangements for trading purposes. 

A reconciliation of the activity of TMCC's derivative financial instruments 
for the years ended September 30, 1997 and 1996 is as follows:

<TABLE>
<CAPTION>

                                                       September 30,
                             ----------------------------------------------------------------
                                Cross
                               Currency
                               Interest         Interest                           Indexed
                              Rate Swap        Rate Swap       Option-based       Note Swap
                              Agreements       Agreements        Products         Agreements
                             ------------     ------------     -------------     ------------
                             1997    1996     1997    1996     1997     1996     1997    1996
                             ----    ----     ----    ----     ----     ----     ----    ----
                                                (Dollars in Billions)
<S>                          <C>     <C>      <C>     <C>      <C>      <C>      <C>     <C>
Beginning Notional Amount... $5.6    $4.8     $6.8    $7.1     $6.2     $3.8     $1.9    $1.7

Add:
   New agreements...........  2.0     1.7      2.0     3.1      2.6      3.4      1.0     1.2

Less:
   Expired agreements.......  1.1     0.9      2.5     3.4      3.2      1.0      0.5     1.0
                             ----    ----     ----    ----     ----     ----     ----    ----
Ending Notional Amount...... $6.5    $5.6     $6.3    $6.8     $5.6     $6.2     $2.4    $1.9
                             ====    ====     ====    ====     ====     ====     ====    ====
</TABLE>

                                      -46-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 11 - Financial Instruments with Off-Balance Sheet Risk (Continued)
-----------------------------------------------------------

Interest Rate Risk Management
-----------------------------

TMCC utilizes interest rate swap agreements in managing its exposure to 
interest rate fluctuations.  Interest rate swap agreements are executed as an 
integral part of specific debt transactions or on a portfolio basis. TMCC's 
interest rate swap agreements involve agreements to pay fixed and receive a 
floating rate, or receive fixed and pay a floating rate, at specified 
intervals, calculated on an agreed-upon notional amount.  Interest rate swap 
agreements may also involve basis swap contracts which are agreements to 
exchange the difference between certain floating interest amounts, such as the 
net payment based on the commercial paper rate and the London Interbank 
Offered Rate ("LIBOR"), calculated on an agreed-upon notional amount.  The 
original maturities of interest rate swap agreements ranged from one to seven 
years at September 30, 1997.

TMCC also utilizes option-based products in managing its exposure to interest 
rate fluctuations.  Option-based products are executed on a portfolio basis 
and consist primarily of purchased interest rate cap agreements.  Option-based 
products are agreements which either grant TMCC the right to receive or 
require TMCC to make payments at specified interest rate levels.  
Approximately 40% of TMCC's other senior debt at September 30, 1997 had 
floating interest rates that were covered by option-based products which had 
an average strike rate of 6.02%.  The premiums paid for option-based products 
are included in deferred charges and are amortized to interest expense over 
the life of the instruments on a straight-line basis.  Amounts receivable 
under option-based products are recorded as a reduction to interest expense.  
The original maturities of option-based products ranged from two to three 
years at September 30, 1997.

The aggregate notional amounts of interest rate swap agreements and option-
based products outstanding at September 30, 1997 and 1996 were as follows:

     <TABLE>
     <CAPTION>
                                                            September 30,
                                                        ---------------------
                                                        1997             1996
                                                        ----             ----
                                                        (Dollars in Billions)
     <S>                                                <C>             <C>
     Fixed rate swaps...............................    $1.5             $2.3

     Floating rate swaps............................     4.1              3.1

     Basis swaps....................................     0.7              1.4
                                                        ----             ----

         Total interest rate swap agreements........    $6.3             $6.8
                                                        ====             ====

     Option-based products..........................    $5.6             $6.2
                                                        ====             ====
      </TABLE>

                                      -47-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 11 - Financial Instruments with Off-Balance Sheet Risk (Continued)
-----------------------------------------------------------

Interest Rate Risk Management (Continued)
-----------------------------

TMCC utilizes indexed note swap agreements in managing its exposure in 
connection with debt instruments whose interest rate and/or principal 
redemption amounts are derived from other underlying instruments.  Indexed 
note swap agreements involve agreements to receive interest and/or principal 
amounts associated with the indexed notes, denominated in either U.S. dollars 
or a foreign currency, and to pay fixed or floating rates on fixed U.S. dollar 
liabilities.  At September 30, 1997, TMCC was the counterparty to $2.4 billion 
of indexed note swap agreements, of which $0.3 billion was denominated in 
foreign currencies and $2.1 billion was denominated in U.S. dollars.  At 
September 30, 1996, TMCC was the counterparty to $1.9 billion of indexed note 
swap agreements, of which $0.6 billion was denominated in foreign currencies 
and $1.3 billion was denominated in U.S. dollars.  The original maturities of 
indexed note swap agreements ranged from one to eleven years at September 30, 
1997.

The notional amounts of interest rate and indexed note swap agreements and 
option-based products do not represent amounts exchanged by the parties and, 
thus, are not a measure of the Company's exposure through its use of 
derivatives.  The amounts exchanged are calculated based on the notional 
amounts and other terms of the derivatives which relate to interest rates or 
financial or other indexes.

Foreign Exchange Risk Management
--------------------------------

TMCC utilizes cross currency interest rate swap agreements to manage exposure 
to exchange rate fluctuations on principal and interest payments for 
borrowings denominated in foreign currencies.  Notes and loans payable issued 
in foreign currencies are hedged by concurrently executed cross currency 
interest rate swap agreements which involve the exchange of foreign currency 
principal and interest obligations for U.S. dollar obligations at agreed-upon 
currency exchange and interest rates.  The aggregate notional amounts of cross 
currency interest rate swap agreements at September 30, 1997 and 1996 were 
$6.5 billion and $5.6 billion, respectively.  The original maturities of cross 
currency interest rate swap agreements ranged from one to seven years at 
September 30, 1997.

                                      -48-

<PAGE>
                    TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 11 - Financial Instruments with Off-Balance Sheet Risk (Continued)
-----------------------------------------------------------


Credit Risk Management
----------------------

TMCC manages the risk of counterparty default through the use of credit 
standard guidelines, counterparty diversification and monitoring of 
counterparty financial condition.  At September 30, 1997, approximately 90% of 
TMCC's derivative financial instruments, based on notional amounts, were with 
commercial banks and investment banking firms assigned investment grade 
ratings of "AA" or better by national rating agencies.  TMCC does not 
anticipate non-performance by any of its counterparties and has no reserves 
related to non-performance as of September 30, 1997; TMCC has not experienced 
any counterparty default during the three years ended September 30, 1997.  
Additionally, TMCC's loss in the event of counterparty default is partially 
mitigated as a result of master netting agreements in place with all 
derivative counterparties which allow the net difference between TMCC and each 
counterparty to be exchanged in the event of default.

Credit exposure of derivative financial instruments is represented by the fair 
value of contracts with a positive fair value at September 30, 1997 reduced by 
the effects of master netting agreements. The credit exposure of TMCC's 
derivative financial instruments at September 30, 1997 was $39 million on an 
aggregate notional amount of $20.8 billion.

                                      -49-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 12 - Pension and Other Benefit Plans
-----------------------------------------

All full-time employees of the Company are eligible to participate in the TMS 
pension plan commencing on the first day of the month following hire.  
Benefits payable under this non-contributory defined benefit pension plan are 
based upon the employees' years of credited service and the highest sixty 
consecutive months' compensation, reduced by a percentage of social security 
benefits.  For the years ended September 30, 1997, 1996 and 1995, the 
Company's pension expense was $4 million, $4 million and $2 million, 
respectively.  At September 30, 1997, 1996 and 1995, the accumulated benefit 
obligation and plan net assets for employees of the Company were not 
determined separately from TMS; however, the plan's net assets available for 
benefits exceeded the accumulated benefit obligation.  TMS funding policy is 
to contribute annually the maximum amount deductible for federal income tax 
purposes.

Note 13 - Provision for Income Taxes
------------------------------------

     The provision for income taxes consisted of the following:
     <TABLE>
     <CAPTION>
                                                Years ended September 30,
                                               --------------------------
                                               1997       1996       1995
                                               ----       ----       ----
                                                  (Dollars in Millions)
     <S>                                       <C>        <C>       <C>
     Current
        Federal...........................     $(14)      $(47)      $(97)
        State.............................      (14)       (23)       (27)
                                               ----       ----       ----
           Total current .................      (28)       (70)      (124)
                                               ----       ----       ----
     Deferred
        Federal...........................      109        129        173
        State.............................       40         49         68
                                               ----       ----       ----
           Total deferred.................      149        178        241
                                               ----       ----       ----
              Provision for income taxes..     $121       $108       $117
                                               ====       ====       ====
     </TABLE>

                                      -50-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 13 - Provision for Income Taxes (Continued)
------------------------------------

The deferred federal and state income tax liabilities are as follows:
     <TABLE>
     <CAPTION>
                                                          September 30,
                                                      ---------------------
                                                      1997             1996
                                                      ----             ----
                                                      (Dollars in Millions)
     <S>                                              <C>              <C>
     Federal........................................  $831             $643
     State..........................................   123              162
                                                      ----             ----
        Net deferred income tax liability...........  $954             $805
                                                      ====             ====
     </TABLE>

The Company's deferred tax assets and liabilities consisted of the following:

     <TABLE>
     <CAPTION>
                                                           September 30,
                                                       ---------------------
                                                       1997             1996
                                                       -----           -----
                                                       (Dollars in Millions)
     <S>                                               <C>             <C>
     Assets:
        Alternative minimum tax.....................   $ 472           $ 436
        Provision for losses........................     148             116
        Deferred administrative fees................      63              54
        NOL carryforwards...........................      56              49
        Deferred acquisition costs..................       8              12
        Unearned insurance premiums.................       3               4
        Revenue recognition.........................       3               2
        Other.......................................       -               3
                                                       -----           -----
           Deferred tax assets......................     753             676
                                                       -----           -----
     Liabilities:
        Lease transactions..........................   1,511           1,330
        State taxes.................................     190             151
        Other.......................................       6               -
                                                       -----           -----
           Deferred tax liabilities.................   1,707           1,481
                                                       -----           -----
           Valuation allowance......................       -               -
                                                       -----           -----
              Net deferred income tax liability.....   $ 954           $ 805
                                                       =====           =====
     </TABLE>
TMCC has state tax net operating loss carryforwards of $756 million which 
expire beginning in fiscal 1998 through 2010.

                                      -51-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 13 - Provision for Income Taxes (Continued)
------------------------------------

A reconciliation between the provision for income taxes computed by applying 
the federal statutory tax rate to income before income taxes and actual income 
taxes provided is as follows:
      <TABLE>
      <CAPTION>
                                                Years ended September 30,
                                                -------------------------
                                                1997      1996       1995
                                                ----      ----       ----
                                                  (Dollars in Millions)
      <S>                                       <C>       <C>        <C>
      Provision for income taxes at
         federal statutory tax rate.........    $ 99      $ 91       $105
      State and local taxes (net of  
         federal tax benefit)...............      17        17         26
      Other, including changes in
         applicable state tax rates.........       5         -        (14)
                                                ----      ----       ----
         Provision for income taxes.........    $121      $108       $117
                                                ====      ====       ====

      Effective tax rate....................   42.69%    41.52%     39.12%

      </TABLE>

Note 14 - Lines of Credit/Standby Letters of Credit
---------------------------------------------------

To support its commercial paper program, TMCC maintains syndicated bank credit 
facilities with certain banks which aggregated $2.0 billion at 
September 30, 1997 and 1996. No loans were outstanding under any of these bank 
credit facilities as of September 30, 1997 or 1996.

To facilitate and maintain letters of credit, TMCC maintains, along with TMS, 
uncommitted, unsecured lines of credit with banks totaling $250 million as of 
September 30, 1997.  Approximately $24 million in letters of credit had been 
issued, primarily related to the Company's insurance operations as of 
September 30, 1997, compared to $44 million as of September 30, 1996.  The 
letters of credit for the insurance companies are used to satisfy requirements 
of certain insurance carriers and state insurance regulatory agencies.



                                      -52-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 15 - Commitments and Contingent Liabilities
------------------------------------------------

At September 30, 1997, the Company was a lessee under lease agreements for 
facilities with minimum future commitments as follows:  years ending 
September 30, 1998 - $9 million; 1999 - $7 million; 2000 - $4 million; 2001 - 
$3 million; 2002 - $2 million; thereafter - $1 million.

TMCC has guaranteed payments of principal and interest on $58 million 
principal amount of flexible rate demand pollution control revenue bonds 
maturing in 2006, issued in connection with the Kentucky manufacturing 
facility of an affiliate.

TMCC has guaranteed the obligations of TMIS relating to vehicle service 
insurance agreements issued on or after July 1, 1997, in the Commonwealth of 
Virginia.  This guarantee has been given without regard to any security and 
without any limitation as to duration or amount.  TMCC has also guaranteed the 
obligations of TMIS under an ISDA master agreement relating to swap 
transactions and other financial instruments.

An operating agreement between TMCC and TCPR (the "Agreement"), provides that 
TMCC will make necessary equity contributions or provide other financial 
assistance TMCC deems appropriate to ensure that TCPR maintains a minimum 
coverage on fixed charges of 1.10 times such fixed charges in any fiscal 
quarter.  The Agreement does not constitute a guarantee by TMCC of any 
obligations of TCPR.  The fixed charge coverage provision of the Agreement is 
solely for the benefit of the holders of TCPR's commercial paper, and the 
Agreement may be amended or terminated at any time without notice to, or the 
consent of, holders of other TCPR obligations.

Various legal actions, governmental proceedings and other claims are pending 
or may be instituted or asserted in the future against TMCC and its 
subsidiaries with respect to matters arising from the ordinary course of 
business.  Certain of these actions are or purport to be class action suits, 
seeking sizeable damages.  Certain of these actions are similar to suits which 
have been filed against other financial institutions and captive finance 
companies.  The amounts of liability on these claims and actions as of 
September 30, 1997 were not determinable; however, in the opinion of 
management, the ultimate liability resulting therefrom should not materially 
affect TMCC's consolidated financial position or results of operations.

                                      -53-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 16 - Segment Information
-----------------------------

TMCC's business operations include primarily financing and insurance 
activities.  Following are gross revenues, income before taxes, assets and 
other information applicable to financing and insurance operations:

<TABLE>
<CAPTION>
                                                   September 30,
                                           ---------------------------------
                                               1997      1996         1995
                                           ---------   ---------   ---------
                                              (Dollars in Millions)
<S>                                        <C>        <C>         <C>
Gross revenues:

  Financing operations.................... $   3,320   $   3,004   $   2,469
  Insurance operations....................       138         115         102
  Eliminations (a)........................        (8)         (5)         (4)
                                           ---------   ---------   ---------
    Total gross revenues.................. $   3,450   $   3,114   $   2,567
                                           =========   =========   =========

Income before income taxes:

  Financing operations.................... $     250     $   241   $     281
  Insurance operations....................        33          19          19
                                           ---------   ---------   ---------
    Total income before income taxes...... $     283     $   260   $     300
                                           =========   =========   =========

Assets:

  Financing operations.................... $  19,519   $  19,052   $  15,990
  Insurance operations....................       334         275         253
  Eliminations (b)........................       (23)        (18)        (18)
                                           ---------   ---------   ---------
    Total assets.......................... $  19,830   $  19,309   $  16,225
                                           =========   =========   =========

Depreciation and amortization:

  Financing operations.................... $   1,834   $   1,645   $   1,285
  Insurance operations....................         1           1           1
                                           ---------   ---------   ---------
    Total depreciation and amortization... $   1,835   $   1,646   $   1,286
                                           =========   =========   =========

Capital expenditures:

  Financing operations.................... $      14   $       6   $       5
  Insurance operations....................         1           1           -
                                           ---------   ---------   ---------
    Total capital expenditures............ $      15   $       7    $      5
                                           =========   =========   =========


    (a) Intersegment insurance tracking revenues.
    (b) Primarily investment in insurance subsidiary.

</TABLE>
TMCC conducts substantially all of its business in the United States.

                                      -54-

<PAGE>
                      TOYOTA MOTOR CREDIT CORPORATION
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 17 - Selected Quarterly Financial Data (Unaudited)
-------------------------------------------------------
<TABLE>
<CAPTION>
                                  Total
                                Financing   Interest   Depreciation     Net
                                Revenues    Expense     on Leases      Income
                               ----------   --------   ------------   --------
                                             (Dollars in Millions)
<S>                            <C>          <C>        <C>            <C>
Year Ended September 30, 1997:

   First quarter..............     $  829       $227         $  470       $ 38
   Second quarter.............        829        225            446         47
   Third quarter..............        813        228            439         44
   Fourth quarter.............        803        238            435         33
                                   ------       ----         ------       ----
      Total...................     $3,274       $918         $1,790       $162
                                   ======       ====         ======       ====

Year Ended September 30, 1996:

   First quarter..............     $  688       $193         $  370       $ 41
   Second quarter.............        724        196            394         36
   Third quarter..............        768        210            416         40
   Fourth quarter.............        798        221            446         35
                                   ------       ----         ------       ----
      Total...................     $2,978       $820         $1,626       $152
                                   ======       ====         ======       ====
</TABLE>

                                      -55-

<PAGE>
ITEM 9.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
          FINANCIAL DISCLOSURE.

There is nothing to report with regard to this item.


                                  PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

The following table sets forth certain information regarding the directors and 
executive officers of TMCC as of November 30, 1997.

           Name                Age              Position
           ----                ---              --------
Yoshio Ishizaka...........      57     Director and President, TMCC;
                                       Director and President, TMS;
                                       Director, TMC

Nobu Shigemi..............      53     Director, Senior Vice President
                                       and Treasurer, TMCC; Group Vice
                                       President, TMS

George Borst .............      49     Director, Senior Vice President
                                       and General Manager, TMCC;
                                       Senior Vice President, TMS

Robert Pitts..............      49     Director and Secretary, TMCC;
                                       Group Vice President, TMS

Yale Gieszl...............      55     Director, TMCC; Director and
                                       Executive Vice President, TMS

Takashi Nishiyama.........      55     Director, TMCC; Senior Vice
                                       President and Treasurer, TMS

Douglas West..............      52     Director, TMCC; Senior Vice
                                       President and Secretary, TMS

Ryuji Araki...............      57     Director, TMCC; Managing Director, TMC

All directors of TMCC are elected annually and hold office until their 
successors are elected and qualified.  Officers are elected annually and serve 
at the pleasure of the Board of Directors.

Mr. Ishizaka was named Director and President of TMCC and TMS in June 1996.  
From January 1990 to May 1996, Mr. Ishizaka was General Manager of the Europe 
Division of TMC, and in September 1992, he was named a Director of TMC.  
Mr. Ishizaka has been employed with TMC, in various positions, since 1964.

Mr. Shigemi was named Director, Senior Vice President and Treasurer of TMCC 
and Group Vice President of TMS in September 1994.  From January 1994 to 
August 1994, Mr. Shigemi was General Manager of TMC's Finance Division.  From 
January 1993 to December 1993, he was the Project General Manager of the 
Accounting Division of TMC.  From February 1982 to December 1992, he worked in 
the Tokyo Secretarial Division having been named a manager in February 1983 
and Deputy General Manager in February 1990.  Mr. Shigemi has been employed 
with TMC, in various positions, since 1968.

Mr. Borst was named Director and Senior Vice President and General Manager of 
TMCC in April 1997 and Senior Vice President of TMS in June 1997.  From 
January 1993 to May 1997, Mr. Borst was Group Vice President of TMS.  From 
April 1989 to December 1992, Mr. Borst was a Vice President of TMS.  Mr. Borst 
has been employed with TMS, in various positions, since 1985.

                                      -56-

<PAGE>
Mr. Pitts was named Director of TMCC and Group Vice President of TMS in April 
1993 and Secretary of TMCC in April 1997.  From January 1984 to March 1993, he 
was an executive with TMCC having been named General Manager in January 1984 
and Vice President in April 1989.  Mr. Pitts has been employed with TMS and 
TMCC, in various positions, since 1971.

Mr. Gieszl was named Director of TMCC in September 1988.  He is also a 
Director and Executive Vice President of TMS, positions he has held since 
December 1989 and June 1992, respectively.  From January 1982 to May 1992, he 
was a Senior Vice President of TMS.  From October 1982 to May 1992, he held 
the position of Senior Vice President of TMCC, and from September 1988 to May 
1992, he also held the position of Secretary of TMCC.  Mr. Gieszl has been 
employed with TMS, in various positions, since 1970.

Mr. Nishiyama was named Director of TMCC and Senior Vice President and 
Treasurer of TMS in January 1994.  From February 1989 to December 1993, he was 
General Manager of the Europe and Africa Project Division of TMC.  From 
February 1986 to January 1989, he was Executive Vice President of Salvador 
Caetano S.A. Portugal.  Mr. Nishiyama has been employed with TMC, in various 
positions, since 1965.

Mr. West was named Director of TMCC and Senior Vice President and Secretary of 
TMS in June 1996.  From June 1996 to March 1997, Mr. West was also a Senior 
Vice President and Secretary of TMCC.  From April 1993 to May 1996, Mr. West 
was a Group Vice President of TMS.  From April 1989 to March 1993, Mr. West 
was a Vice President of TMS.  Mr. West has been employed with TMS, in various 
positions, since 1982.

Mr. Araki was named Director of TMCC in September 1995.  He was named Managing 
Director of TMC's Board of Directors in June 1997 and has served on TMC's 
Board of Directors since September 1992.  Mr. Araki has been employed with 
TMC, in various positions, since 1962.

                                      -57-

<PAGE>
ITEM 11.  EXECUTIVE COMPENSATION.

Summary Compensation Table

The following table sets forth all compensation awarded to, earned by, or paid 
to the Company's Principal Executive Officer and the most highly compensated 
executive officers whose salary and bonus for the latest fiscal year exceeded 
$100,000, for services rendered in all capacities to the Company for the 
fiscal years ended September 30, 1997, 1996 and 1995.

<TABLE>
<CAPTION>
                                    Annual Compensation
                        --------------------------------------------
                                                        Other Annual    All
     Name and           Fiscal                          Compensation   Other
Principal Position       Year   Salary ($)   Bonus ($)     ($)<F1>    ($)<F2>
---------------------   ------  ----------   ---------  ------------  -------
<S>                     <C>     <C>          <C>        <C>           <C>
George Borst            1997     $115,500     $56,700             -   $3,300
Principal Executive     1996          N/A         N/A           N/A      N/A
Officer <F3>            1995          N/A         N/A           N/A      N/A

Wolfgang Jahn           1997     $119,460     $55,000             -   $4,300
Principal Executive     1996     $233,100     $94,500             -   $8,500
Officer <F3>            1995     $213,800     $98,700             -   $6,000

Nobu Shigemi            1997     $415,500     $49,600       $44,000        -
Senior Vice President   1996     $316,000     $50,900       $51,700        -
                        1995     $199,000     $40,500       $47,300        -
<FN>
------------
<F1> The amounts in this column represent housing allowances and relocation 
costs.
<F2> The amounts in this column represent the Company's allocated contribution 
under the TMS Savings Plan (the "Plan"), a tax-qualified 401(k) Plan.  
Participants in the Plan may elect, subject to applicable law, to contribute 
up to 6% of their base compensation on a pre-tax basis to which the Company 
adds an amount equal to two-thirds of the employee's contribution.  
Participants are vested 25% each year with respect to the Company's 
contribution and are fully vested after four years.  Subject to the 
limitations of the Plan, employee and Company contributions are invested in 
various investment options at the discretion of the employee.  TMS also 
maintains a 401(k) Excess Plan, a non-qualified deferred compensation plan 
which has similar provisions to the Saving Plan.
<F3> Mr. Jahn served as Principal Executive Officer during the current fiscal 
year through March 1997.  Effective April 1, 1997, Mr. Borst was appointed as 
Principal Executive Officer in place of Mr. Jahn.  The compensation presented 
for Mr. Jahn and Mr. Borst reflect amounts earned for services to the Company 
during the partial periods of the fiscal year each served as Principal 
Executive Officer.
</FN>
</TABLE>

Employee Benefit Plan

The following pension plan table presents typical annual retirement benefits 
under the TMS Pension Plan for various combinations of compensation and years 
of credited service for participants who retire at age 62, assuming no final 
average bonus and excluding Social Security offset amounts.  The amounts are 
subject to Federal statutory limitations governing pension calculations and 
benefits.

                                      -58-

<PAGE>
<TABLE>
<CAPTION>
                                Annual Benefits for
     Final Average           Years of Credited Service
        Annual          ------------------------------------
     Compensation          15            20            25
     -------------      --------      --------      --------
     <S>                <C>           <C>           <C>
        $50,000          $15,000       $20,000       $25,000
       $100,000          $30,000       $40,000       $50,000
       $150,000          $45,000       $60,000       $75,000
       $200,000          $60,000       $80,000      $100,000
       $250,000          $75,000      $100,000      $125,000
       $300,000          $90,000      $120,000      $150,000
       $350,000         $105,000      $140,000      $175,000
       $400,000         $120,000      $160,000      $200,000
       $450,000         $135,000      $180,000      $225,000
       $500,000         $150,000      $200,000      $250,000

</TABLE>

All full-time employees of the Company are eligible to participate in the TMS 
Pension Plan commencing on the first day of the month following hire.  
Benefits payable under this non-contributory defined benefit pension plan are 
based upon final average compensation, final average bonus and years of 
credited service.  Final average compensation is defined as the average of the 
participant's base rate of pay, plus overtime, during the highest-paid 60 
consecutive months prior to the earlier of termination or normal retirement.  
Final average bonus is defined as the highest average of the participant's 
fiscal year bonus, and basic seniority-based cash bonus for non-managerial 
personnel, over a period of 60 consecutive months prior to the earlier of 
termination or normal retirement.  A participant generally becomes eligible 
for the normal retirement benefit at age 62, and may be eligible for early 
retirement benefits starting at age 55.

The annual normal retirement benefit under the Pension Plan, payable monthly, 
is an amount equal to the number of years of credited service (up to 25 years) 
multiplied by the sum of (i) 2% of the participant's final average 
compensation less 2% of the estimated annual Social Security benefit payable 
to the participant at normal retirement and (ii) 1% of the participant's final 
average bonus.  The normal retirement benefit is subject to reduction for 
certain benefits under any union-sponsored retirement plan and benefits 
attributable to employer contributions under any defined-contribution 
retirement plan maintained by TMS and its subsidiaries or any affiliate that 
has been merged into the TMS Pension Plan.

The TMS Supplemental Executive Retirement Plan (TMS SERP) authorizes a benefit 
to be paid to eligible executives, including Mr. Borst and Mr. Jahn.  Benefits 
under the TMS SERP, expressed as an annuity payable monthly, are based on 2% 
of the executive's compensation recognized under the plan after deducting the 
executive's primary Social Security benefit, multiplied by the years of 
service credited under the plan (up to a maximum of 25), offset by benefits 
payable under the TMS Pension Plan.  A covered participant's compensation may 
include base pay and a percentage (not in excess of 100%) of bonus pay, 
depending on the executive's length of service in certain executive positions. 
Similarly, years of service credited under the plan are determined by 
reference, in part, to the executive's length of service in certain executive 
positions.  No benefit is payable under the TMS SERP to an executive unless 
the executive's termination of employment occurs on a date, after the 
executive reaches age 55, that is agreed in writing by the President of TMS 
and the executive; and the executive is vested in benefits under the TMS 
Pension Plan, or unless the executive accepts an invitation to retire extended 
by the President of TMS.

                                      -59-

<PAGE>
Mr. Borst is a participant in the TMS Pension Plan and the TMS SERP and had 
13 years of total credited service as of September 30, 1997, 6 months of which 
have been allocated to the Company.  Based upon years of credited service 
allocable to the Company, Mr. Borst would be entitled to receive and the 
Company would be required to pay approximately $2,000 in annual pension 
benefits when Mr. Borst reaches age 62.  Mr. Borst would also be entitled to 
receive pension benefits from TMS based upon services to and compensation by 
TMS.

Mr. Jahn is a participant in the TMS Pension Plan and the TMS SERP and had 
24 years of total credited service as of September 30, 1997, 8 years of which 
have been allocated to the Company.  Based upon years of credited service 
allocable to the Company, Mr. Jahn would be entitled to receive and the 
Company would be required to pay approximately $34,000 in annual pension 
benefits when Mr. Jahn reaches age 62.  Mr. Jahn would also be entitled to 
receive pension benefits from TMS based upon services to and compensation by 
TMS.

Compensation of Directors

No amounts are paid to members of the TMCC Board of Directors for their 
services as directors.

Compensation Committee Interlocks and Insider Participation

Members of the Executive Committee of the Board of Directors, which consists 
of the directors of the Company other than Mr. Araki, participate in decisions 
regarding the compensation of the executive officers of the Company.  Certain 
of the members of the Executive Committee are current or former executive 
officers of the Company.  Certain of the members of the Executive Committee 
are also current executive officers and directors of TMS and its affiliates 
and participate in compensation decisions for those entities. 

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

As of the date hereof, all of TMCC's capital stock is owned by TMS.

ITEM 13.  CERTAIN RELATIONSHIPS AND TRANSACTIONS.

Transactions between the Company and its parent, TMS, are included in Note 2, 
Note 8, and Note 15 of the Notes to the Consolidated Financial Statements.  
Certain directors and executive officers of TMCC are also directors and 
executive officers of TMS. In addition, see Item 1, Business - General, for a 
description of certain obligations of TMMNA to TMCC.  


                                  PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.

(a)(1)Financial Statements

          Included in Part II, Item 8 of this Form 10-K.  See Index to
          Financial Statements on page 23.

   (2)Exhibits

          The exhibits listed on the accompanying Exhibit Index, starting on
          page 62, are filed as part of, or incorporated by reference into,
          this Report.

(b)Reports on Form 8-K

          There were no reports on Form 8-K filed by the registrant during the
          quarter ended September 30, 1997.

                                      -60-

<PAGE>
                                SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange 
Act of 1934, the registrant has duly caused this report to be signed on its 
behalf by the undersigned, thereunto duly authorized, in the City of Torrance, 
State of California, on the 22nd day of December, 1997.

                                        TOYOTA MOTOR CREDIT CORPORATION


                                        By     /S/ GEORGE BORST
                                           ------------------------------
                                                   George Borst
                                               Senior Vice President
                                                and General Manager

Pursuant to the requirements of the Securities Exchange Act of 1934, this 
report has been signed below by the following persons on behalf of the 
registrant in the capacities indicated on the 22nd day of December, 1997.

            Signature                                   Title
            ---------                                   -----
                                          Senior Vice President and General
                                                 Manager and Director      
      /S/ GEORGE BORST                      (Principal Executive Officer)
------------------------------------         
          George Borst

                                                Senior Vice President/
                                                Treasurer and Director
      /S/ NOBU SHIGEMI                       (Principal Financial Officer)
------------------------------------
          Nobu Shigemi  

                                               Vice President - Finance
                                                  and Administration
      /S/ GREGORY WILLIS                     (Principal Accounting Officer)
------------------------------------
          Gregory Willis



      /S/ YOSHIO ISHIZAKA                               Director
------------------------------------
          Yoshio Ishizaka



      /S/ DOUGLAS WEST                                  Director
------------------------------------
          Douglas West



      /S/ TAKASHI NISHIYAMA                             Director
------------------------------------
          Takashi Nishiyama

                                      -61-

<PAGE>
                               EXHIBIT INDEX

                                                                    Method
Exhibit                                                               of
Number                          Description                         Filing
-------                         -----------                        --------

3.1(a)    Articles of Incorporation filed with the California 
          Secretary of State on October 4, 1982.                       (1)

3.1(b)    Certificate of Amendment of Articles of Incorporation 
          filed with the California Secretary of State on 
          January 24, 1984.                                            (1)

3.1(c)    Certificate of Amendment of Articles of Incorporation 
          filed with the California Secretary of State on 
          January 25, 1985.                                            (1)

3.1(d)    Certificate of Amendment of Articles of Incorporation 
          filed with the California Secretary of State on 
          September 6, 1985.                                           (1)

3.1(e)    Certificate of Amendment of Articles  of Incorporation 
          filed with the California Secretary of State on 
          February 28, 1986.                                           (1)
 
3.1(f)    Certificate of Amendment of Articles of Incorporation 
          filed with the California Secretary of State on 
          December 3, 1986.                                            (1)

3.1(g)    Certificate of Amendment of Articles of Incorporation 
          filed with the California Secretary of State on 
          March 9, 1987.                                               (1)

3.1(h)    Certificate of Amendment of Articles of Incorporation 
          filed with the California Secretary of State on 
          December 20, 1989.                                           (2)

3.2       Bylaws as amended through January 16, 1993.                  (6)

4.1       Issuing and Paying Agency Agreement dated August 1, 
          1990 between TMCC and Bankers Trust Company.                 (3)

4.2(a)    Indenture dated as of August 1, 1991 between TMCC and 
          The Chase Manhattan Bank, N.A.                               (4)









-----------------
(1)  Incorporated herein by reference to the same numbered Exhibit filed 
     with TMCC's Registration Statement on Form S-1, File No. 33-22440.
(2)  Incorporated herein by reference to the same numbered Exhibit filed
     with TMCC's Report on Form 10-K for the year ended September 30, 1989,
     Commission File number 1-9961.
(3)  Incorporated herein by reference to Exhibit 4.2 filed with TMCC's
     Report on Form 10-K for the year ended September 30, 1990,
     Commission File number 1-9961.
(4)  Incorporated herein by reference to Exhibit 4.1(a), filed with TMCC's
     Registration Statement on Form S-3, File No. 33-52359.
(6)  Incorporated herein by reference to the same numbered Exhibit filed
     with TMCC's Report on Form 10-K for the year ended September 30, 1993,
     Commission File number 1-9961.

                                      -62-

<PAGE>
                               EXHIBIT INDEX

                                                                    Method
Exhibit                                                               of
Number                          Description                         Filing
-------                         -----------                         ------

4.2(b)   First Supplemental Indenture dated as of
         October 1, 1991 among TMCC, Bankers Trust Company 
         and The Chase Manhattan Bank, N.A.                           (5)

4.3(a)   Second Amended and Restated Agency Agreement dated          Filed
         July 24, 1997 among TMCC, The Chase Manhattan Bank         Herewith
         and Chase Manhattan Bank Luxembourg S.A.

4.4      TMCC has outstanding certain long-term debt as set
         forth in Note 9 of the Notes to Consolidated Financial
         Statements and certain demand notes issued under an 
         Indenture dated September 1, 1997.  Not filed herein as
         an exhibit, pursuant to Item 601(b) (4)-(iii)(A) of
         Regulation S-K under the Securities Act of 1933, is any
         instrument which defines the rights of holders of such
         long-term debt or demand notes, where the total amount
         of securities authorized thereunder does not exceed 10%
         of the total assets of TMCC and its subsidiaries on a 
         consolidated basis. TMCC agrees to furnish copies of
         all such instruments to the Securities and Exchange 
         Commission upon request.

10.1(a)  Operating Agreement dated January 16, 1984 between 
         TMCC and TMS.                                               (16)

10.1(b)  Amendment No. 1 to Operating Agreement dated May 14, 1996
         between TMCC and TMS.                                       (11)

10.1(c)  Amendment No. 2 to Operating Agreement dated December 1,    Filed
         1997 between TMCC, TMS and TMMNA                           Herewith






















-----------------
(5)  Incorporated herein by reference to Exhibit 4.1 filed with TMCC's
     Current Report on Form 8-K dated October 16, 1991, Commission File
     No. 1-9961.
(11) Incorporated herein by reference to Exhibit 10.1 filed with TMCC's
     Report on Form 10-Q for the quarter ended March 31, 1996, Commission
     File No. 1-9961.
(16) Incorporated herein by reference to Exhibit 10.1 filed with TMCC's
     Registration Statement on Form S-1, File No. 33-22440.

                                      -63-

<PAGE>
                               EXHIBIT INDEX

                                                                    Method
Exhibit                                                               of
Number                          Description                         Filing
-------                         -----------                         ------

10.2     Pooling and Servicing Agreement among TMCRC,
         as Seller, TMCC, as Servicer, and Bankers Trust Company,
         as Trustee (including forms of Class A and Class B 
         Certificates) dated as of September 1, 1995.                 (7)

10.3     Receivables Purchase Agreement dated as of September 1,
         1995 between TMCC, as Seller, and TMCRC Corporation,
         as Purchaser.                                                (8)
                                        
10.4     Form of Indemnification Agreement between TMCC and  
         its directors and officers.                                 (12)

10.5(a)  Three-year Credit Agreement (the "Three-year Agreement")
         dated as of September 29, 1994 among TMCC, Morgan
         Guaranty Trust Company of New York, as agent, and 
         Bank of America National Trust and Savings Association,
         The Bank of Tokyo, Ltd., The Chase  Manhattan Bank, N.A., 
         Citicorp USA, Inc. and Credit Suisse, as Co-Agents.
         Not filed herein as an exhibit, pursuant to Instruction 2
         to Item 601 of Regulation S-K under the Securities Act of
         1933, is the 364-day Credit Agreement (the "364-day 
         Agreement") among TMCC and the banks who are party to the 
         Three-year Agreement.  Filed herewith is a 
         Schedule identifying the 364-day Agreement and setting
         forth the material details in which the 364-day 
         Agreement differs from the Three-year Agreement.  TMCC
         agrees to furnish a copy of the 364-day Agreement to
         the Securities and Exchange Commission upon request.        (13)

10.5(b)  Amendment No. 1 dated September 28, 1995 to the             
         Three-year Agreement.                                       (14)

10.5(c)  Amendment No. 1 dated September 28, 1995 to the            
         364-day Agreement.                                          (15)









----------------
(7)  Incorporated herein by reference to Exhibit 4.1 filed with Toyota Auto
     Receivables 1995-A Grantor Trust's Current Report on Form 8-K dated
     November 10, 1995, Commission File No. 33-96006.
(8)  Incorporated herein by reference to Exhibit 10.1 filed with Toyota
     Auto Receivables 1995-A Grantor Trust's Current Report on Form 8-K
     dated November 10, 1995, Commission File No. 33-96006.
(12) Incorporated herein by reference to Exhibit 10.6 filed with TMCC's
     Registration Statement on Form S-1, Commission File No. 33-22440.
(13) Incorporated herein by reference to Exhibit 10.10 filed with TMCC's
     Report on Form 10-K for the year ended September 30, 1994,
     Commission File No. 1-9961.
(14) Incorporated herein by reference to Exhibit 10.10(a) filed
     with TMCC's Report on Form 10-K for the year ended September 30, 1995,
     Commission File No. 1-9961.
(15) Incorporated herein by reference to Exhibit 10.10(b) filed with TMCC's
     Report on Form 10-K for the year ended September 30, 1995, Commission
     File No. 1-9961.

                                      -64-

<PAGE>
                               EXHIBIT INDEX

                                                                    Method
Exhibit                                                               of
Number                          Description                         Filing
-------                         -----------                         ------

10.5(d)  Amended and Restated Credit Agreement dated
         September 24, 1996 to the Three-year Agreement.              (17)

10.5(e)  Amended and Restated Credit Agreement dated
         September 24, 1996 to the 364-day Agreement.                 (18)

10.5(f)  Amended and Restated Credit Agreement dated                 Filed
         September 23, 1997 to the Three-year Agreement.            Herewith

10.5(g)  Amended and Restated Credit Agreement dated                 Filed
         September 23, 1997 to the 364-day Agreement.               Herewith

10.6     Toyota Motor Sales, U.S.A., Inc. Supplemental
         Executive Retirement Plan. *                                 (9)

10.7     Toyota Motor Sales, U.S.A., Inc. 401(k)
         Excess Plan. *                                               (10)

10.8     Amended and Restated Trust and Servicing Agreement
         dated as of October 1, 1996 by and among TMCC,
         TMTT, Inc., as titling trustee and U.S. Bank National
         Association, as trust agent.                                 (19)

12.1     Calculation of ratio of earnings to fixed charges.          Filed
                                                                    Herewith

21.1     TMCC's list of subsidiaries.                                Filed
                                                                    Herewith

23.1     Consent of Independent Accountants.                         Filed
                                                                    Herewith

27.1     Financial Data Schedule.                                    Filed
                                                                    Herewith








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(9)  Incorporated herein by reference to Exhibit 10.1 filed with TMCC's 
     Report on Form 10-Q for the quarter ended December 31, 1995, Commission
     File No. 1-9961.
(10) Incorporated herein by reference to Exhibit 10.2 filed with TMCC's
     Report on From 10-Q for the quarter ended December 31, 1995, Commission
     File No. 1-9961.
(17) Incorporated herein by reference to Exhibit 10.9(d) filed with TMCC's
     Report on Form 10-K for the year ended September 30, 1996, Commission
     File No. 1-9961.
(18) Incorporated herein by reference to Exhibit 10.9(e) filed with TMCC's
     Report on Form 10-K for the year ended September 30, 1996, Commission
     File No. 1-9961.
(19) Incorporated herein by reference to Exhibit 4.1 filed with Toyota Auto
     Lease Trust 1997-A's Report on Form 8-A dated December 23, 1997,
     Commission File No. 333-26717
*-   Management contract or compensatory plan or arrangement required to be
     filed as an exhibit pursuant to applicable rules of the Securities and
     Exchange Commission.

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