______________________________________________________________________

        				united states
		      securities and exchange commission
   			  Washington,  D. C.  20549



				  FORM 10-Q



	     quarterly report pursuant to section 13 or 15(d) of
		     the securities exchange act of 1934


For the Quarterly Period Ended August 31, 1996    Commission File No. 0-12867

				      or

	    transition report pursuant to section 13 or 15(d) of
		     the securities exchange act of 1934

	      For the transition period from                to  

				 ____________  

			       3Com Corporation
	   (Exact name of registrant as specified in its charter)

     	       California                                   94-2605794
     (State or other jurisdiction of                     (I.R.S. Employer
     incorporation or organization)                     Identification No.)

	  5400 Bayfront Plaza                                 95052
	Santa Clara, California                             (Zip Code)
(Address of principal executive offices)


Registrant's telephone number, including area code   (408) 764-5000

Former name, former address and former fiscal year, if changed since last
report:   N/A

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 ....XX....          No ................

As of August 31, 1996, 169,904,038 shares of the Registrant's Common Stock
were outstanding.

_______________________________________________________________________


			      3Com Corporation

			     Table of Contents


PART I.  FINANCIAL INFORMATION

Item 1.         Financial Statements

		Consolidated Balance Sheets
		August 31, 1996 and May 31, 1996        

		Consolidated Statements of Income
		Quarters Ended August 31, 1996 and 1995 

		Consolidated Statements of Cash Flows
		Quarters Ended August 31, 1996 and 1995 

		Notes to Consolidated Financial Statements      

Item 2.         Management's Discussion and Analysis of Financial
		Condition and Results of Operations     


PART II.  OTHER INFORMATION

Item 1.         Legal Proceedings       

Item 2.         Changes in Securities   

Item 3.         Defaults Upon Senior Securities 

Item 4.         Submission of Matters to a Vote of Security Holders 

Item 5.         Other Information      

Item 6.         Exhibits and Reports on Form 8-K        


Signatures          




		       PART I.  FINANCIAL INFORMATION

Item 1. Financial Statements

			      3Com Corporation
			 Consolidated Balance Sheets
			   (Dollars in thousands)

                                           						August 31,      May 31,
                                           						   1996          1996    
                                           						----------      -------
                                         					       (Unaudited)
ASSETS
Current Assets:
  Cash and cash equivalents                     $  218,035    $  216,759
  Temporary cash investments                       359,111       282,578
  Trade receivables                                418,840       359,182
  Inventories                                      227,375       241,018
  Deferred income taxes                             87,789        79,259
  Other                                             70,933        60,915
                                          						----------    ----------
Total current assets                             1,382,083     1,239,711
						                                          ----------    ----------

Property and equipment-net                         267,531       246,652
Other assets                                        39,916        38,754
                                          						----------    ----------

Total                                           $1,689,530    $1,525,117
                                          						==========    ==========

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
  Accounts payable                              $  111,418    $  120,211
  Accrued and other liabilities                    241,005       211,620
  Income taxes payable                             106,267        82,690
                                          						----------    ----------
Total current liabilities                          458,690       414,521

Long-term debt                                     110,000       110,000
Other long-term obligations                          5,371         5,492
Deferred income taxes                               22,638        16,299

Shareholders' Equity:
Preferred stock, no par value, 3,000,000 shares
  authorized; none outstanding                          -             -  
Common stock, $.01 par value, 400,000,000 shares 
  authorized; shares outstanding:  August 31, 1996:
  169,904,038; May 31, 1996:  168,799,586          619,771       597,452
Unamortized restricted stock grants                 (4,144)       (4,487)
Retained earnings                                  472,468       379,358
Unrealized net gain on available-for-sale
  securities                                         5,257         7,159
Accumulated translation adjustments                   (521)         (677)
                                          						----------    ----------
  
Total shareholders' equity                       1,092,831       978,805
                                          						----------    ----------

Total                                           $1,689,530    $1,525,117
                                          						==========    ==========

See notes to consolidated financial statements.




	      		       3Com Corporation
		       Consolidated Statements of Income
 		     (In thousands except per share data)
                                                  				 (Unaudited)

                                          						      Quarters Ended
                                                 							August 31, 
                                          						    ------------------
                                          						    1996          1995    
                                          						    ----          ----

Sales                                           $  706,968    $  497,289

Cost of sales                                      325,032       235,550
                                          						----------    ----------

Gross margin                                       381,936       261,739

Operating expenses:
  Sales and marketing                              141,357       102,211
  Research and development                          69,516        51,548
  General and administrative                        29,591        20,941
                                          						----------    ----------
  Total                                            240,464       174,700
                                          						----------    ----------

Operating income                                   141,472        87,039
Other income--net                                    2,894         1,253
                                          						----------    ----------

Income before income taxes                         144,366        88,292
Income tax provision                                51,253        30,871
                                          						----------    ----------

Net income                                      $   93,113    $   57,421
                                          						==========    ==========



Net income per common and                                       
  equivalent share:
    Primary                                     $     0.52    $     0.33
    Fully diluted                               $     0.52    $     0.33

Common and equivalent shares used 
  in computing per share amounts:
    Primary                                        179,174       173,833
    Fully diluted                                  179,448       174,520

See notes to consolidated financial statements.




			          3Com Corporation
		    Consolidated Statements of Cash Flows
			      (Dollars in thousands)
       	  			 (Unaudited)

                                          						      Quarters Ended
                                                							 August 31,      
                                          						    ------------------
                                          						    1996          1995
                                          						    ----          ----

Cash flows from operating activities:
  Net income                                    $   93,113    $   57,421
  Adjustments to reconcile net income to cash
    provided by operating activities:               
    Depreciation and amortization                   31,987        19,446
    Deferred income taxes                             (875)       11,966
    Adjustment to conform fiscal year of pooled
      entity - Chipcom                                  -         (3,048)
    Changes in assets and liabilities, net of effects
      of acquisitions:
	Trade receivables                                 (59,658)      (40,995)
	Inventories                                        11,804       (17,116)
	Other current assets                              (13,365)        2,794
	Accounts payable                                   (8,793)       (1,866)
	Accrued and other liabilities                      30,756        (5,995)
	Income taxes payable                               38,083        14,950
	Acquisition-related reserves                       (1,036)           -
	                                          					----------    ----------
	
Net cash provided by operating activities          122,016        37,557
                                          						----------    ----------

Cash flows from investing activities:
  Purchase of property and equipment               (48,314)      (38,228)
  Purchase of temporary cash investments          (152,770)      (47,103)
  Proceeds from temporary cash investments          75,401        86,720  
  Other-net                                         (2,805)       (7,989)
                                          						----------    ----------

Net cash used for investing activities            (128,488)       (6,600)
                                          						----------    ----------

Cash flows from financing activities:
  Sale of stock                                      7,810         5,444
  Repayments of notes payable and capital
    lease obligations                                 (218)       (1,717)
  Other-net                                            156          (366)
                                          						----------    ----------

Net cash provided by financing activities            7,748         3,361
                                          						----------    ----------

Increase in cash and cash equivalents                1,276        34,318
Cash and cash equivalents at beginning of period   216,759       159,908
                                          						----------    ----------

Cash and cash equivalents at end of period      $  218,035    $  194,226
                                          						==========    ==========

Non-cash financing and investing activities:
  Tax benefit on stock option transactions      $   14,506    $    8,698
  Unrealized net gain (loss) on available-
    for-sale securities                         $   (1,902)   $      122

See notes to consolidated financial statements.




    			       3Com Corporation
		 Notes to Consolidated Financial Statements

1.      The consolidated financial statements include the 
accounts of 3Com Corporation (the "Company") and its 
wholly-owned subsidiaries.  All significant intercompany 
balances and transactions have been eliminated.  In the 
opinion of management, these unaudited consolidated 
financial statements include all adjustments necessary 
for a fair presentation of the Company's financial 
position as of August 31, 1996, and the results of 
operations and cash flows for the quarters ended August 
31, 1996 and 1995.

	The results of operations for the quarter ended 
August 31, 1996 may not necessarily be indicative of the 
results to be expected for the fiscal year ending May 31, 
1997.

	These financial statements should be read in 
conjunction with the consolidated financial statements 
and related notes thereto included in the Company's 
Annual Report to Shareholders for the fiscal year ended 
May 31, 1996.

2.      Inventories consisted of (in thousands):

                      				  August 31,      May 31,
                       				    1996           1996   
                       				    ----           ----

	Finished goods            $  130,224    $  132,363
	Work-in-process               18,604        22,310
	Raw materials                 78,547        86,345
                     				  ----------    ----------

	Total                     $  227,375    $  241,018
                     				  ==========    ==========

3.      Net Income Per Share

	Net income per common and equivalent share is 
computed based on the weighted average number of common 
shares and the dilutive effects of stock options 
outstanding during the period using the treasury stock 
method.  The effect of the assumed conversion of the 
10.25% convertible subordinated notes was excluded from 
the computation as it was antidilutive for the periods 
presented.

4.      Litigation

	On October 13, 1995, the Company acquired Chipcom, 
which had already been named as a defendant in the 
litigation described below.  Five complaints were filed 
between May, 30, 1995 and June 16, 1995 that alleged 
violations by the defendants of Sections 10(b) and 20(a) 
of the Securities and Exchange Act of 1934, and sought 
unspecified damages.  The cases were consolidated for 
pretrial purposes pursuant to an order entered by the 
Court on June 15, 1995.  The consolidated action is 
entitled In re: Chipcom Securities Litigation, Civil 
Action No. 95-111114-DPW.  A Consolidated Complaint was 
filed on September 13, 1995, and an Amended Consolidated 
Complaint was filed on November 30, 1995.  

	The defendants' motion to dismiss the Amended 
Consolidated Complaint was granted without leave to amend 
on May 1, 1996. The dismissal covers all five cases.  The 
plaintiffs appealed the order granting the dismissal.  On 
October 1, 1996, the parties to these cases agreed upon 
what the Company considers to be favorable financial 
terms for settlement of all five cases, which amount the 
Company does not consider material to its operations or 
financial position.  Pursuant to the contemplated 
settlement, which would be subject to the approval of the 
District Court, it is intended that all claims of all 
persons which are related to the subject matter of the 
Consolidated Complaint would be settled and released.

5.      Subsequent Event

	On September 26, 1996, the shareholders of the 
Company approved a proposal to amend 3Com's Articles of 
Incorporation to designate a par value of $.01 for each 
share of common stock.  The financial statements have 
been restated to reflect this event.




			       3Com Corporation

Item 2. Management's Discussion and Analysis of 
	Financial Condition and Results of Operations

Results of Operations

Quarters Ended August 31, 1996 and 1995

	The Company achieved record sales in the first quarter of 
fiscal 1997 totaling $707.0 million, an increase of $209.7 
million or 42 percent from the corresponding quarter a year 
ago.  Compared with the fourth quarter of fiscal 1996, sales 
for the first quarter of fiscal 1997 increased $46.7 million 
or seven percent.

	The Company believes that the year-over-year increase in 
first quarter sales is due to several factors, including 
continued strength in the data networking market as customers 
migrate to new technologies such as Fast Ethernet, increases 
in worldwide personal computer sales, and the strength of the 
Company's product offerings at the edge of the network, 
including workgroup switching and hubs.  The Company also 
believes that the impact of a strong new product cycle in 
systems and adapter products and the continuous expansion of 
3Com's product offerings and its ability to deliver complete 
data networking solutions for different connectivity 
environments contributed to the increase in first quarter 
sales over the same period a year ago.

	Sales of network systems products (i.e., internetworking 
platforms, remote access servers, hubs, switching products and 
customer service) in the first quarter of fiscal 1997 
represented 59 percent of total sales and increased 38 percent 
from the same quarter one year ago.  In the first quarter of 
fiscal 1996, sales of network systems products represented 61 
percent of total sales.  The increase was led primarily by the 
LinkSwitch(registered trademark) workgroup switching family, the 
LinkBuilder(registered trademark) FMSII stackable hub, the 
SuperStack LinkBuilder FMS 100 Stackable Fast Ethernet Hub, 
and the CELLplex(trademark) ATM switching family.  
The increase was partially offset by a decrease in sales of 
discontinued product lines acquired from Chipcom.  Customer 
service revenue is included in network systems products 
(previously this revenue was classified as other products), 
and accordingly, all sales composition and growth percentages 
reflect this reclassification.

	Sales of network adapters in the first quarter of fiscal 
1997 represented 40 percent of total sales and increased 52 
percent from the year-ago period.  In the first quarter of 
fiscal 1996, sales of network adapters represented 37 percent 
of total sales.  The increase in network adapter sales was led 
primarily by the Fast EtherLink(registered trademark) PCI 
adapters, EtherLink III family of network adapters, and the 
EtherLink PC Card adapters.

	Sales of other products represented one percent of total 
sales in the first quarter of fiscal 1997, compared with two 
percent of total sales in the first quarter of fiscal 1996, 
and is not significant to the Company's operations, as 
expected.

	Sales in the United States for the first quarter of 
fiscal 1997, comprised 52 percent of total sales, compared to 
49 percent in the same period a year ago.  Sales growth in the 
United States was 49 percent when compared to the first 
quarter of fiscal 1996.  The Company believes the growth in 
sales in the United States can be attributed primarily to 
increased sales to large enterprise organizations and the 
enhancement of the Company's product portfolio.  International 
sales for the first quarter of fiscal 1997 increased 35 
percent over the same period a year ago, and increased in all 
geographic regions, primarily in the Asia Pacific region.  The 
Company believes that the growth in International sales is due 
primarily to the Company's continued global expansion through 
the opening of new sales offices, and the expansion of its 
worldwide field sales, service and support programs.  The 
Company's operations were not significantly impacted by 
fluctuations in foreign currency exchange rates in the first 
quarters of fiscal 1997 and 1996.

	Cost of sales as a percentage of sales was 46.0 percent 
in the first quarter of fiscal 1997, compared to 47.4 percent 
for the first quarter of fiscal 1996.  The resulting 
improvement in gross margin in the first quarter of fiscal 
1997 primarily reflected an increased shipment mix of higher 
margin workgroup switching and stackable system products, and 
lower product material costs of certain adapter products.  The 
combination of these factors would have increased gross margin 
by approximately 2.7 percentage points.  Factors causing the 
increase in gross margin were partially offset by increased 
provisions for excess and obsolete inventories and a higher 
mix of certain lower margin adapter products, which 
collectively would have reduced gross margin by approximately 
1.3 percentage points.

	Total operating expenses in the first quarter of fiscal 
1997 were $240.5 million, or 34.0 percent of sales, compared 
to $174.7 million, or 35.1 percent of sales, in the first 
quarter of fiscal 1996.

	Sales and marketing expenses in the first quarter of 
fiscal 1997 increased $39.1 million or 38 percent from fiscal 
1996.  As a percentage of sales, sales and marketing expenses 
decreased to 20.0 percent in the first quarter of fiscal 1997, 
from 20.6 percent in the corresponding fiscal 1996 period.  
The decrease as a percentage of sales is due in part to gains 
in efficiency following assimilation of the separate sales, 
marketing and support organizations initially present as a 
result of the fiscal 1996 acquisition of Chipcom.  A recent 
initiative of the Company is to increase personnel in field 
sales, service and support organizations to further serve its 
customers and channel partners, which the Company anticipates 
may result in a slight increase in sales and marketing expense 
as a percentage of sales in future periods.

	Research and development expenses in the first quarter of 
fiscal 1997 increased $18.0 million or 35 percent from the 
year-ago period.  As a percentage of sales, such expenses 
decreased to 9.8 percent in fiscal 1997, compared to 10.4 
percent in the first quarter of fiscal 1996.  The increase in 
research and development expenses was primarily attributable 
to the cost of developing 3Com's new products, primarily 
switching, traffic management and adapter products, and the 
Company's expansion into new technologies and markets.  The 
Company believes the timely introduction of new technologies 
and products is crucial to its success, and plans to continue 
to make acquisitions to accelerate time to market where 
appropriate.  Most of the in-process research and development 
projects acquired in connection with the Company's business 
acquisitions have been completed.  The Company estimates that 
the remaining costs in connection with the completion of 
outstanding acquired research and development projects are not 
significant, and are primarily made up of labor costs for 
design, prototype development and testing.  The Company 
anticipates total future research and development spending as 
a percent of sales will not significantly differ from its 
historical trend. 

	General and administrative expenses in the first quarter 
of fiscal 1997 increased $8.7 million or 41 percent from the 
same period a year-ago.  The increase in general and 
administrative expenses reflected expansion of the Company's 
infrastructure through internal growth, and higher provisions 
for bad debts, as a result of the increased volume of sales.  
As a percentage of sales, such expenses remained flat at 4.2 
percent, when compared to the same period a year ago.

	Other income (net) was $2.9 million in the first quarter 
of fiscal 1997, compared to $1.3 million in the first quarter 
of fiscal 1996.  The increase was due primarily to interest 
income, which increased due to larger cash and investment balances.

	The Company's effective income tax rate was 35.5 percent 
in the first quarter of fiscal 1997, compared to 35.0 percent 
in the first quarter of 1996.

	Net income for the first quarter of fiscal 1997 was $93.1 
million, or $0.52 per share, compared to net income of $57.4 
million, or $0.33 per share, for the first quarter of fiscal 
1996.  Net income and net income per share increased 62 and 58 
percent, respectively, from the first quarter of fiscal 1996.

Business Environment and Risk Factors

	The Company's future operating results may be affected by 
various trends and factors which the Company must successfully 
manage in order to achieve favorable operating results.  In 
addition, there are trends and factors beyond the Company's 
control which affect its operations.  In accordance with the 
provisions of the Private Securities Litigation Reform Act of 
1995, the cautionary statements set forth below identify 
important factors that could cause actual results to differ 
materially from those in any forward-looking statements which 
may be contained in this report.  Such trends and factors 
include, but are not limited to, adverse changes in general 
economic conditions or conditions in the specific markets for 
the Company's products, governmental regulation or 
intervention affecting communications or data networking, 
fluctuations in foreign exchange rates, and other factors, 
including those listed below.  The Company participates in a 
highly volatile and rapidly growing industry which is 
characterized by vigorous competition for market share and 
rapid technological development carried out amidst uncertainty 
over adoption of industry standards and protection of 
proprietary intellectual property rights.  This could result 
in aggressive pricing practices and growing competition, both 
from start-up companies and from well-capitalized computer 
systems and communications companies.  The Company's ability 
to compete in this environment depends upon a number of 
competitive and market factors, and is subject to the risks 
set forth in this report.

	The market for the Company's products is characterized by 
rapidly changing technology.  The Company's success depends, 
in substantial part, on the timely and successful introduction 
of new products.  An unexpected change in one or more of the 
technologies affecting data networking, or in market demand 
for products based on a particular technology could have a 
material adverse effect on the Company's operating results if 
the Company does not respond timely and effectively to such 
changes.  The  Company is engaged in research and development 
activities in certain emerging LAN and WAN high-speed 
technologies, such as ATM, ISDN, Fast Ethernet, Gigabit 
Ethernet and data-over-cable.  As the industry standardizes on 
high-speed technologies, there can be no assurance that the 
Company will be able to respond promptly and cost-effectively 
to compete in the marketplace.

	Some key components of the Company's products are 
currently available only from single sources.  There can be no 
assurance that in the future the Company's suppliers will be 
able to meet the Company's demand for components in a timely 
and cost-effective manner.  The Company's operating results 
and customer relationships could be adversely affected by 
either an increase in prices for, or an interruption or 
reduction in supply of, any key components.  

	The Company distributes a significant portion of its 
products through third party distributors and resellers.  Due 
to consolidation in the distribution and reseller channels and 
the Company's increased volume of sales into these channels, 
the Company has experienced an increased concentration of 
credit risk.  While the Company continually monitors and 
manages this risk, financial difficulties on the part of one 
or more of the Company's resellers may have a material adverse 
effect on the Company.  Likewise, the Company's expansion into 
certain emerging geographic markets, characterized by economic 
and political instability and currency fluctuations, may 
subject the Company's resellers to financial difficulties 
which may have an adverse impact on the Company.

	The Company will continue to invest during fiscal 1997 in 
expanding its sales, marketing, service, logistics and 
manufacturing operations worldwide.  The Company's ability to 
achieve continued sales and earnings growth may be adversely 
affected unless the Company can successfully implement several 
projects, including the continued expansion of the Company's 
direct sales force and the establishment of a new 
manufacturing and distribution facility in the Asia Pacific 
region.

	Acquisitions of complementary businesses and 
technologies, including technologies and products under 
development, are an active part of the Company's overall 
business strategy.  Certain of the Company's major competitors 
have also been engaged in merger and acquisition transactions.  
Such consolidations by competitors are likely to create 
entities with increased market share, customer base, 
technology and marketing expertise, sales force size, or 
proprietary technology in segments in which the Company 
competes, which may adversely affect the Company's ability to 
compete in such segments.

	The Company has consummated several acquisitions in 
recent years.  There can be no assurance that products, 
technologies, distribution channels, key personnel and 
businesses of acquired companies will be effectively 
assimilated into the Company's business or product offerings, 
or that such integration will not adversely affect the 
Company's business, financial condition or results of 
operations.  The difficulties of such integration may be 
increased by the size and number of such acquisitions and the 
requirements of coordinating geographically separated 
organizations.  There can be no assurance that any acquired 
products, technologies or businesses will contribute at 
anticipated levels to the Company's sales or earnings, that 
the sales, earnings and technologies under development from 
acquired businesses will not be adversely affected by the 
integration process or other general factors.  If the Company 
is not successful in the integration of such acquisitions, 
there could be an adverse impact on the financial results of 
the Company.  The high-growth nature of the computer 
networking industry, coupled with critical time-to-market 
factors, has caused increased competition and consolidation.  
As a result, there has been a significant increase in the 
acquisition value of computer networking companies.  Future 
acquisitions are therefore more likely to result in values 
that are material to the Company's operations.  There can be 
no assurance that the Company will continue to be able to 
identify and consummate suitable acquisition transactions in 
the future.

	The Company's business is characterized by the continuous 
introduction of new products and the management of the 
transition of those products from prior generations of 
technology or product platforms.  In each product transition 
cycle, the Company faces the challenge of managing the 
inventory of its older products, including materials, work-in-
process, and products held by resellers.  If the Company is 
not successful in managing these transitions, there could be 
an adverse impact on the financial results of the Company.  

	The Company's products are covered by product warranties 
and the Company may be subject to contractual commitments 
concerning product features or performance.  If unexpected 
circumstances arise such that the product does not perform as 
intended and the Company is not successful in resolving 
product quality or performance issues, there could be an 
adverse impact on sales and earnings.

	The market price of the Company's common stock has been, 
and may continue to be, extremely volatile. Factors such as 
new product announcements by the Company or its competitors, 
quarterly fluctuations in the Company's operating results, 
challenges associated with integration of businesses and 
general conditions in the data networking market may have a 
significant impact on the market price of  the  Company's  
common  stock.   These conditions, as well as factors which 
generally affect the market for stocks of high technology 
companies, could cause the price of the Company's stock to 
fluctuate substantially over short periods.

	Notwithstanding the Company's increased geographical 
diversification, the Company's corporate headquarters and a 
large portion of its research and development activities and 
other critical business operations are located in California, 
near major earthquake faults.  The Company's business, 
financial condition and operating results could be materially 
adversely affected in the event of a major earthquake.  

	Because of the foregoing factors, as well as other 
factors affecting the Company's operating results, past trends 
and performance should not be presumed by investors to be an 
accurate indicator of  future results or trends.

Liquidity and Capital Resources

	Cash, cash equivalents and temporary cash investments at 
August 31, 1996 were $577.1 million, increasing $77.8 million, 
from May 31, 1996.

	For the three months ended August 31, 1996, net cash 
generated from operating activities was $122.0 million.  Trade 
receivables at August 31, 1996 increased $59.7 million from 
May 31, 1996 due primarily to an increase in sales.  Days 
sales outstanding in receivables was 53 days at August 31, 
1996, compared to 49 days at May 31, 1996.  The increase in 
days sales outstanding is consistent with the trend in 
previous first fiscal quarters.  Inventory levels at August 
31, 1996 decreased $13.6 million from the prior fiscal year-
end, with inventory turnover increasing to 5.6 turns at August 
31, 1996, compared to 5.4 turns at May 31, 1996.

	During the three months ended August 31, 1996, the 
Company made $48.3 million in capital expenditures.  Major 
capital expenditures included upgrades and additions to 
product manufacturing lines in Santa Clara and Ireland, 
continuing development of the Company's worldwide information 
systems, and purchases and upgrades of desktop systems.

	During the first quarter of fiscal 1997, the Company 
received cash of $7.8 million from the sale of its common 
stock to employees through its option plans.

	The Company leases and occupies 225,000 square feet of 
office and manufacturing space adjacent to its existing 
headquarters in Santa Clara (Phase I).  The Company amended 
this lease agreement on February 1, 1996 to add 150,000 square 
feet of office and manufacturing space and a parking garage 
(Phase II) to be build on adjacent land.  The amended lease 
expires in five years and provides the Company with an option 
to purchase both Phase I and II properties, or arrange for the 
sale of the properties, to a third party with a guaranteed 
residual value of up to $57.8 million to the seller of the 
properties.  The Company anticipates that it will commence 
occupancy of and begin lease payments on the significant 
portion of the Phase II property in the fourth quarter of 
fiscal 1997.

	The Company has a $40 million revolving bank credit 
agreement which expires December 31, 1996. No amount is 
outstanding under the credit agreement and the Company is in 
compliance with all financial ratio and minimum net worth 
requirements.

	Based on current plans and business conditions, the 
Company believes that its existing cash and equivalents, 
temporary cash investments, cash generated from operations and 
the available revolving credit agreement will be sufficient to 
satisfy anticipated operating cash requirements for at least 
the next twelve months. 

Subsequent Event

	On October 7, 1996 the Company announced a definitive 
agreement to acquire OnStream Networks, Inc. (OnStream) 
located in Santa Clara, California.  OnStream develops, 
manufactures and supports high-speed, broadband network access 
and management products for enterprises and telecommunications 
carriers.  The transaction will be accounted for as a pooling-
of-interests.  The Company expects to issue approximately 3.3 
million shares of its common stock and options to purchase 
500,000 shares of its common stock in exchange for all 
outstanding stock and options of OnStream.  The merger is 
subject to a number of conditions including the effectiveness 
of a registration statement covering the shares to be issued 
and approval by the shareholders of OnStream, and is expected 
to be completed in November 1996.  As a result of the merger, 
it is expected that the combined company will incur a charge 
of approximately $5 to $10 million, primarily for direct 
transaction costs.  These non-recurring costs will be charged 
to the Company's operations in the fiscal quarter in which the 
merger is consummated.




		      PART II.      OTHER INFORMATION

Item 1. Legal Proceedings

	On October 13, 1995, the Company acquired Chipcom, 
which had already been named as a defendant in the 
litigation described below.  Five complaints were filed 
between May 30, 1995 and June 16, 1995 that alleged 
violations by the defendants of Sections 10(b) and 20(a) 
of the Securities and Exchange Act of 1934, and sought 
unspecified damages.  The cases were consolidated for 
pretrial purposes pursuant to an order entered by the 
Court on June 15, 1995.  The consolidated action is 
entitled In re: Chipcom Securities Litigation, Civil 
Action No. 95-111114-DPW.  A Consolidated Complaint was 
filed on September 13, 1995, and an Amended Consolidated 
Complaint was filed on November 30, 1995.  

	The defendants' motion to dismiss the Amended 
Consolidated Complaint was granted without leave to amend 
on May 1, 1996. The dismissal covers all five cases.  The 
plaintiffs appealed the order granting the dismissal.  On 
October 1, 1996, the parties to these cases agreed upon 
what the Company considers to be favorable financial 
terms for settlement of all five cases, which amount the 
Company does not consider material to its operations or 
financial position.  Pursuant to the contemplated 
settlement, which would be subject to the approval of the 
District Court, it is intended that all claims of all 
persons which are related to the subject matter of the 
Consolidated Complaint would be settled and released.

Item 2. Changes in Securities

		None.

Item 3. Defaults Upon Senior Securities

		None.

Item 4. Submission of Matters to a Vote of Security Holders

		None.

Item 5. Other Information

		None.

Item 6. Exhibits and Reports on Form 8-K

		(a)     Exhibits

			No exhibits were required to be filed for the 
quarter ending August 31, 1996.

		(b)     Reports on Form 8-K

			None.




				 Signatures




Pursuant to the requirements 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.


					 3Com Corporation
					 (Registrant)



Dated: October 11, 1996              By: /s/ Christopher B. Paisley  
      ------------------                 --------------------------
                                   					 Christopher B. Paisley
                                  	 				 Senior Vice President Finance
                                  		 			 and Chief Financial Officer
                                 				 	 (Principal Financial Officer)