| **EXHIBIT 11**                                                                                               | ** ** |
|--------------------------------------------------------------------------------------------------------------|------------|
| **HILTON HOTELS CORPORATION AND SUBSIDIARIES**                                                               |
| **Computation of Per Share Earnings**                                                                        |
| ** **                                                                                                   | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** |
| ** **                                                                                                   | ** ** | **2002** | ** ** | **2003** | ** ** | **2004** | ** ** |
| **Basic**                                                                                                    |       |   |   |   |   |   |   |
| Net income (in millions)                                                                                     |       | $ | 198 |   | 164 |   | 238 |   |
|                                                                                                         |       |   |   |   |   |   |   |
| Weighted average common shares                                                                               |       | 373,992,000 |   | 377,941,000 |   | 384,362,000 |   |
|                                                                                                         |       |   |   |   |   |   |   |
| Basic earnings per common share                                                                              |       | $ | .53 |   | .43 |   | .62 |   |
|                                                                                                         |       |   |   |   |   |   |   |
| **Diluted**                                                                                                  |       |   |   |   |   |   |   |
| Income (in millions)                                                                                         |       |   |   |   |   |   |   |
| Net income                                                                                                   |       | $ | 198 |   | 164 |   | 238 |   |
| Add after tax interest applicable to convertible notes                                                       |       | 16 |   | 14 |   | 12 |   |
| Net income, as adjusted                                                                                      |       | $ | 214 |   | 178 |   | 250 |   |
|                                                                                                         |       |   |   |   |   |   |   |
| Shares                                                                                                       |       |   |   |   |   |   |   |
| Weighted average common shares—basic                                                                    |       | 373,992,000 |   | 377,941,000 |   | 384,362,000 |   |
| Assuming conversion of convertible notes                                                                     |       | 22,556,000 |   | 26,375,000 |   | 25,556,000 |   |
| Dilutive effect of assumed option exercises (as determined by the  application of the treasury stock method) |       | 4,116,000 |   | 5,961,000 |   | 8,024,000 |   |
| Common and common equivalent shares as adjusted                                                              |       | 400,664,000 |   | 410,277,000 |   | 417,942,000 |   |
|                                                                                                         |       |   |   |   |   |   |   |
| Diluted earnings per common share                                                                            |       | $ | .53 |   | .43 |   | .60 |   |

 

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