=================================================================
                                
                          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 July 31, 1997
                                
                   Commission file no: 1-6458
                   ___________________________
                                
                 JOHN DEERE CAPITAL CORPORATION
                                
         Delaware                           36-2386361
(State of incorporation)        (IRS employer identification no.)
                                
                 1 East First Street, Suite 600
                       Reno, Nevada  89501
            (Address of principal executive offices)
                                
                Telephone Number:  (702) 786-5527
                _________________________________
                                
                                
     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

     At  July 31, 1997, 2,500 shares of common stock, without par
value,  of  the  registrant were outstanding, all of  which  were
owned by John Deere Credit Company, a wholly-owned subsidiary  of
Deere & Company.

     The  registrant  meets the conditions set forth  in  General
Instruction H(1)(a) and (b) of Form 10-Q and is therefore  filing
this  Form  with  certain  reduced disclosures  as  permitted  by
General Instructions H(2).
=================================================================
                       Page 1 of 16 Pages
                   Index to Exhibits:  Page 14
                                
                                
<PAGE>                                
                PART I.    FINANCIAL INFORMATION

Item 1.  Financial Statements
                                
         John Deere Capital Corporation and Subsidiaries
                Statements of Consolidated Income
                           (Unaudited)
                          (in millions)

                                   Three Months    Nine Months
                                      Ended           Ended
                                     July 31         July 31
                                  ------------------------------
                                   1997    1996    1997    1996
Revenues                          ------  ------  ------  ------
  Finance income earned
    on retail notes               $111.1  $ 89.4  $306.7  $277.1
  Revolving charge account
    income                          26.6    24.9    71.2    67.6
  Lease revenues                    32.4    18.1    82.8    45.9
  Finance income earned on
    wholesale notes                 12.3     9.8    36.0    26.0
  Net gain on retail notes sold      7.4      .5     9.2    10.6
  Interest income from
    short-term investments           2.6     3.1     7.6     8.7
  Securitization and servicing
    fee income                       5.9    11.0    23.5    31.9
  Other income                       2.0     1.9     5.9     9.2
----------------------------------------------------------------
      Total revenues               200.3   158.7   542.9   477.0
----------------------------------------------------------------
Expenses
  Interest expense:
    On obligations to others        86.4    66.7   235.2   199.2
    On notes payable to
        Deere & Company               .2      .1     1.5     1.5
----------------------------------------------------------------
      Total interest expense        86.6    66.8   236.7   200.7
----------------------------------------------------------------
  Operating expenses:
    Administrative and
      operating expenses            25.9    22.8    74.6    66.0
    Provision for credit losses      8.8     8.5    25.0    24.4
    Fees paid to Deere & Company     1.9     1.5     6.3     4.7
    Depreciation of equipment on
        operating leases            18.8     9.4    50.6    23.6
----------------------------------------------------------------
      Total operating expenses      55.4    42.2   156.5   118.7
----------------------------------------------------------------
      Total expenses               142.0   109.0   393.2   319.4
----------------------------------------------------------------
Income of consolidated group
  before income taxes               58.3    49.7   149.7   157.6
Provision for income taxes          20.3    17.4    52.1    55.1
----------------------------------------------------------------
Income of consolidated group        38.0    32.3    97.6   102.5
Equity in loss of
  unconsolidated affiliate           (.2)    ---    (1.1)    ---
----------------------------------------------------------------
Net income                        $ 37.8  $ 32.3  $ 96.5  $102.5
================================================================

           See Notes to Interim Financial Statements.
                                
                             Page 2
                                
                                
<PAGE>                                
         John Deere Capital Corporation and Subsidiaries
                   Consolidated Balance Sheets
                           (Unaudited)
                      (dollars in millions)
                                
                                 July 31,   October 31,  July 31,
                                   1997        1996        1996
Assets                           --------    --------    --------
  Cash and cash equivalents      $  187.0    $  171.0    $  168.1
  Receivables and leases:
    Retail notes                  4,499.0     4,069.6     3,982.7

    Revolving charge accounts       613.2       571.1       552.0
    Financing leases                208.2       181.5       162.7
    Wholesale notes                 522.7       524.5       443.0
-----------------------------------------------------------------
      Total receivables           5,843.1     5,346.7     5,140.4
    Equipment on operating
      leases -- net                 459.8       276.8       240.8
-----------------------------------------------------------------
      Total receivables
        and leases                6,302.9     5,623.5     5,381.2
    Allowance for credit losses     (89.3)      (87.4)      (84.1)
-----------------------------------------------------------------
      Total receivables
        and leases -- net         6,213.6     5,536.1     5,297.1
-----------------------------------------------------------------
    Other receivables               144.4       189.9       172.3
    Investment in
      unconsolidated affiliate        8.4         6.3         ---
    Other assets                     72.1        67.8        66.3
-----------------------------------------------------------------
Total Assets                     $6,625.5    $5,971.1    $5,703.8
=================================================================
Liabilities and Stockholder's Equity
  Short-term borrowings:
    Commercial paper             $2,382.8    $1,689.9    $2,229.7
    Deere & Company                 123.6       544.8       192.5
    Current maturities of
      long-term borrowings          618.8       863.7       778.5
    Other notes payable               1.8         ---         ---
-----------------------------------------------------------------
      Total short-term
        borrowings                3,127.0     3,098.4     3,200.7
-----------------------------------------------------------------
  Accounts payable and accrued
      liabilities:
    Accrued interest on
      senior debt                    51.4        35.9        41.4
    Other payables                  165.8       144.8       126.4
-----------------------------------------------------------------
      Total accounts payable
        and accrued liabilities     217.2       180.7       167.8
-----------------------------------------------------------------
  Deposits withheld from
    dealers and merchants           134.0       135.4       129.0
-----------------------------------------------------------------
  Long-term borrowings:
    Senior debt                   2,203.7     1,649.5     1,145.7
    Subordinated debt               150.0       150.0       300.0
-----------------------------------------------------------------
      Total long-term borrowings  2,353.7     1,799.5     1,445.7
-----------------------------------------------------------------
      Total liabilities           5,831.9     5,214.0     4,943.2
-----------------------------------------------------------------
  Stockholder's equity
    Common stock, without par value
      (issued and outstanding --
      2,500 shares owned by John
      Deere Credit Company)         112.8       112.8       112.8
    Retained earnings               680.9       644.4       647.8
    Cumulative translation
        adjustment                    (.1)        (.1)        ---
-----------------------------------------------------------------
      Total stockholder's equity    793.6       757.1       760.6
-----------------------------------------------------------------
Total Liabilities and
  Stockholder's Equity           $6,625.5    $5,971.1    $5,703.8
=================================================================

           See Notes to Interim Financial Statements.
                                
                             Page 3
                                
                                
<PAGE>                                
         John Deere Capital Corporation and Subsidiaries
              Statements of Consolidated Cash Flows
                           (Unaudited)
                          (in millions)
                                
                                       Nine Months Ended July 31
                                       -------------------------
                                           1997           1996
                                       -------------------------
Cash Flows from Operating Activities:
  Net income                            $    96.5      $   102.5
  Adjustments to reconcile net
    income to net cash provided
    by operating activities:
  Provision for credit losses                25.0           24.4
  Provision for depreciation                 50.5           25.2
  Equity in loss of unconsolidated
    affiliate                                 1.1            ---
  Other                                      24.4            3.8
----------------------------------------------------------------
    Net cash provided by
      operating activities                  197.5          155.9
----------------------------------------------------------------
Cash Flows from Investing Activities:
  Cost of receivables and
    leases acquired                      (4,734.4)      (4,009.6)
  Collections of receivables              3,562.9        2,862.6
  Proceeds from sales of receivables        433.0          622.6
  Other                                      26.7           24.8
----------------------------------------------------------------
    Net cash used for investing
      activities                           (711.8)        (499.6)
----------------------------------------------------------------
Cash Flows from Financing Activities:
  Increase in commercial paper              692.9          243.0
  Change in receivable/payable
    with Deere & Company                   (411.9)        (267.5)
  Increase in other notes payable             1.8            ---
  Proceeds from issuance of
    long-term borrowings                    885.0          550.0
  Principal payments on
    long-term borrowings                   (577.5)        (143.0)
  Dividends paid                            (60.0)         (35.0)
----------------------------------------------------------------
    Net cash provided by
      financing activities                  530.3          347.5
----------------------------------------------------------------
Net increase in cash and
  cash equivalents                           16.0            3.8
Cash and cash equivalents
  at the beginning of period                171.0          164.3
----------------------------------------------------------------
Cash and cash equivalents
  at the end of period                  $   187.0      $   168.1
================================================================
                                
           See Notes to Interim Financial Statements.
                                
                             Page 4
                                
                                
<PAGE>                                
         John Deere Capital Corporation and Subsidiaries
              Notes to Interim Financial Statements

(1)   The consolidated financial statements of John Deere Capital
Corporation  (Capital  Corporation) and its  subsidiaries,  Deere
Credit, Inc., Deere Credit Services, Inc., Farm Plan Corporation,
John Deere Receivables, Inc., John Deere Funding Corporation  and
Arrendadora John Deere, S.A. de C.V. (collectively referred to as
the  Company)  have been prepared by the Company, without  audit,
pursuant  to  the  rules and regulations of  the  Securities  and
Exchange    Commission.    Certain   information   and   footnote
disclosures  normally  included in  annual  financial  statements
prepared   in  accordance  with  generally  accepted   accounting
principles  have been condensed or omitted as permitted  by  such
rules  and  regulations.  All adjustments, consisting  of  normal
recurring  adjustments, have been included.  Management  believes
that the disclosures are adequate to present fairly the financial
position,  results of operations and cash flows at the dates  and
for  the  periods presented.  It is suggested that these  interim
financial  statements be read in conjunction with  the  financial
statements and the notes thereto included in the Company's latest
annual report on Form 10-K.  Results for interim periods are  not
necessarily  indicative of those to be expected  for  the  fiscal
year.

The  preparation  of  financial  statements  in  conformity  with
generally  accepted accounting principles requires management  to
make  estimates and assumptions that affect the reported  amounts
and  related disclosures.  Actual results could differ from those
estimates.

(2)   The  principal  business of the Company  is  providing  and
administering  financing for retail purchases  of  new  and  used
equipment   manufactured  by  Deere  &  Company's   agricultural,
construction  (formerly known as industrial) and  commercial  and
consumer  equipment  divisions.   The  Company  purchases  retail
installment sales and loan contracts (retail notes) from Deere  &
Company  and  its wholly-owned subsidiaries (collectively  called
John  Deere).   These  retail notes are acquired  by  John  Deere
through independent John Deere retail dealers.  The Company  also
purchases  and  finances certain agricultural,  construction  and
lawn  and  grounds  care retail notes unrelated  to  John  Deere,
primarily  used  equipment accepted  by  dealers  in  trade.   In
addition, the Company purchases and finances recreational product
retail notes acquired from independent dealers and marine product
mortgage  service companies (recreational product retail  notes).
The  Company also leases equipment to retail customers,  finances
and  services revolving charge accounts acquired from and offered
through merchants in the agricultural, lawn and grounds care  and
recreational product retail markets (revolving charge  accounts),
and  provides wholesale financing for inventories of recreational
vehicles, manufactured housing units, yachts, John Deere engines,
John Deere construction equipment and the Sabre line of equipment
owned  by  dealers  of those products (wholesale  notes).  Retail
notes,  revolving  charge accounts, direct financing  leases  and
wholesale notes receivable are collectively called "Receivables."
Receivables   and   operating  leases  are  collectively   called
"Receivables and Leases."

(3)  The consolidated ratio of earnings to fixed charges was 1.66
to  1  for the third quarter of 1997 compared with 1.74 to 1  for
the third quarter of 1996.  The consolidated ratio of earnings to
fixed charges was 1.63 to 1 for the first nine months of 1997 and
1.78  to 1 for the first nine months of 1996.  "Earnings" consist
of  income before income taxes, the cumulative effect of  changes
in  accounting  and  fixed charges.  "Fixed charges"  consist  of
interest  on  indebtedness, amortization  of  debt  discount  and
expense,  an estimated amount of rental expense under capitalized
leases  which  is  deemed to be representative  of  the  interest
factor and rental expense under operating leases.

                             Page 5

<PAGE>

(4)   During the first nine months of 1997, the Company  received
proceeds  from  the sale of retail notes of $433.0  million.   At
July  31,  1997,  the  net unpaid balance  of  all  retail  notes
previously  sold  was  $1.040 billion.  At  July  31,  1997,  the
Company's   maximum  exposure  under  all  financing   receivable
recourse provisions was $142.4 million for all retail notes sold.

(5)   The  Company is subject to various unresolved legal actions
which  arise  in  the  normal course of its  business,  the  most
prevalent  of  which  relate  to state  and  federal  regulations
concerning retail credit.  Although it is not possible to predict
with  certainty the outcome of these unresolved legal actions  or
the range of possible loss, the Company believes these unresolved
legal  actions  will not have a material effect on its  financial
position or results of operations.

(6)   In  the  first  quarter of 1997, the  Company  adopted  the
Financial  Accounting Standards Board (FASB) Statement  No.  121,
Accounting for the Impairment of Long-Lived Assets and for  Long-
Lived  Assets to Be Disposed Of.  In the first quarter  of  1997,
the  Company also adopted FASB Statement No. 125, Accounting  for
Transfers  and  Servicing of Financial Assets and Extinguishments
of  Liabilities.  The adoption of these Statements had no  effect
on the Company's financial position or results of operations.

                             Page 6

<PAGE>

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

Results of Operations

Net  income  was $37.8 million in the third quarter of  1997  and
$96.5  million  for the first nine months of 1997  compared  with
$32.3  million and $102.5 million for the same periods last year.
Third  quarter  earnings  reflect higher  income  from  a  larger
average balance of receivables and leases financed and gains from
the   sale  of  retail  notes.   Year-to-date  results  decreased
primarily  due to narrower financing spreads, higher expenditures
associated   with   several   growth   initiatives   and    lower
securitization  and  servicing fee income, which  were  partially
offset by higher income from a 19 percent increase in the average
balance of Receivables and Leases financed during the first  nine
months.

Revenues totaled $200.3 million and $542.9 million for the  third
quarter  and  for  the  first nine months of 1997,  respectively,
compared  to  $158.7  million and $477.0  million  for  the  same
periods  a year ago.  Revenues increased due to a larger  average
portfolio  financed,  particularly related to  growth  in  retail
notes,  operating  leases and wholesale  notes.   Finance  income
earned  on retail notes totaled $111.1 million and $306.7 million
for  the  third  quarter and for the first nine months  of  1997,
respectively,  compared to $89.4 million and $277.1  million  for
the  same  periods  in  1996.   Lease  revenues  increased  $36.9
million, to $82.8 million in the first nine months of 1997,  from
$45.9  million in the first nine months of 1996, largely  due  to
low-rate  leasing initiatives related to John Deere  agricultural
equipment.   Finance income earned on wholesale  notes  increased
$10.0 million to $36.0 million for the first nine months of  1997
from $26.0 million earned in the first nine months of 1996.   The
higher  finance income earned on wholesale notes was primarily  a
result  of  the  continued  growth  in  the  construction   floor
planning, manufactured housing and yacht markets.

In July 1997, the Company securitized and sold approximately $400
million  in retail notes, resulting in an initial gain  on  notes
sold  of  $5.7 million.  Securitization and servicing fee  income
declined  $8.4 million, from $31.9 million during the first  nine
months  of 1996 to $23.5 million during the first nine months  of
1997.   The  decrease in securitization and servicing fee  income
was  primarily the result of a 15 percent decrease in the average
balance of retail notes previously sold.

Total interest expense for the third quarter increased from $66.8
million  in  1996  to  $86.6 million in 1997.   Interest  expense
increased from $200.7 million for the first nine months  of  1996
to  $236.7  million  for the first nine months  of  1997.   These
increases  in  interest  expense were  primarily  the  result  of
increased  borrowings  required to  finance  the  higher  average
portfolio  of  Receivables and Leases.  Total average  borrowings
during  the  first  nine  months of  1997  were  $5.310  billion,
compared to $4.427 billion in the first nine months of 1996.  The
weighted  average interest rate on total borrowings for the  nine
months  ended July 31, 1997 and 1996 were 6.03 percent  and  5.96
percent, respectively.

Administrative and operating expenses were $25.9 million  in  the
third quarter of 1997 and $74.6 million for the first nine months
of  1997, compared with $22.8 million and $66.0 million  for  the
same  periods in 1996.  These increases were the result of higher
employment   costs   associated  with  administering   a   larger
Receivable  and Lease portfolio and certain expenses relating  to
several  growth  initiatives.   The  growth  initiatives  include
expansion of international retail financing, a focus on golf  and
turf  financing,  and continued efforts related to  agricultural-
business  finance opportunities, such as farmer operating  loans.
Operating  expenses were also affected by higher depreciation  of
equipment on operating leases, which totaled $18.8 million in the
third  quarter of 1997 and $50.6 million in the first nine months
of  1997, compared to $9.4 million and $23.6 million for the same
periods  in  1996,  a result of the increase in operating  leases
financed.

During  the third quarter and the first nine months of 1997,  the
provision  for  credit  losses totaled  $8.8  million  and  $25.0
million,  respectively,  compared with  $8.5  million  and  $24.4
million  in the same periods last year.  The annualized provision
for credit losses, as a percentage of the total average portfolio
outstanding, was .55 percent for the third quarter  of  1997  and
 .56  percent for the first nine months of 1997, compared with .67
percent and .65 percent for the same periods last year.

                             Page 7

<PAGE>

In  October  1996, the Capital Corporation entered into  a  joint
venture,  John  Deere Credit Limited (JDCL), to  offer  equipment
financing products in the United Kingdom.  Through July 31, 1997,
the  Capital  Corporation's  share  of  JDCL's  losses  was  $1.1
million,   representing   primarily  fixed   administrative   and
operating expenses associated with this new affiliate.

Receivable and Lease acquisition volumes were as follows (dollars
in millions):

                              Three Months
                             Ended July 31,
                            ----------------
                             1997      1996     $ Chng     % Chng
                            -------------------------------------
Retail notes volumes:
  Agricultural equipment    $  459    $  425    $   34         8%
  Construction equipment        92       110       (18)      (16)
  Lawn and grounds care
    equipment                   53        51         2         4
  Recreational products         60        59         1         2
                            ---------------------------
    Total retail note
      volumes                  664       645        19         3
Revolving charge accounts      463       392        71        18
Wholesale notes                279       279        --        --
Leases                         125        87        38        44
                            ---------------------------
    Total Receivable and
      Lease volumes         $1,531    $1,403    $  128         9
                            ===========================


                              Nine months
                             Ended July 31,
                            ----------------
                             1997      1996     $ Chng     % Chng
                            -------------------------------------
Retail notes volumes:
  Agricultural equipment    $1,909    $1,616    $  293        18%
  Construction equipment       277       339       (62)      (18)
  Lawn and grounds care
    equipment                  111        86        25        29
  Recreational products        270       190        80        42
                            ---------------------------
    Total retail note
      volumes                2,567     2,231       336        15
Revolving charge accounts    1,018       866       152        18
Wholesale notes                791       682       109        16
Leases                         359       231       128        55
                            ---------------------------
    Total Receivable and
      Lease volumes        $ 4,735   $ 4,010    $  725        18
                           ============================

Receivable  and  Lease  volumes increased nine  percent  for  the
quarter and 18 percent for the first nine months of 1997 compared
to  a year ago primarily due to the increased sales of John Deere
agricultural   equipment.    Agricultural  retail  note   volumes
increased  eight percent in the third quarter and 18  percent  in
the  first  nine months of 1997 compared to the same  periods  in
1996.    Construction  retail  note  volumes   decreased,   while
construction  leasing  volumes increased during  the  first  nine
months  of 1997, primarily due to the marketing and promotion  of
the  Company's construction equipment leasing programs.  Lawn and
grounds  care retail note volumes also increased as a  result  of
John  Deere's  promotional efforts, including low-rate  incentive
programs during the first nine months of 1997.  Revolving  charge
account  volumes increased based on continued strong  demand  for
these  products.  Wholesale note volumes were higher in the nine-
month  period  primarily as a result of increases in construction
floor planning and manufactured housing.

                             Page 8

<PAGE>

Total Receivables and Leases held were as follows (in millions):

                           July 31,  October 31,  July 31,
                             1997       1996        1996
                           -------------------------------
Retail notes held:
  Agricultural equipment   $ 2,736    $ 2,418     $ 2,359
  Construction equipment       637        629         596
  Lawn and grounds care
    equipment                  207        183         174
  Recreational products        919        840         854
                           ------------------------------
    Total retail notes
      held                   4,499      4,070       3,983
Revolving charge accounts      613        571         552
Wholesale notes                523        524         443
Leases                         668        459         403
                           ------------------------------
    Total Receivables and
      Leases held          $ 6,303    $ 5,624     $ 5,381
                           ==============================


Retail  notes  administered by the Company, which include  retail
notes  previously sold, totaled $5.539 billion at July 31,  1997,
$5.253  billion at October 31, 1996, and $5.084 billion  at  July
31,  1996.   At  July  31,  1997, the  balance  of  retail  notes
previously  sold was $1.040 billion compared with $1.177  billion
at  October  31, 1996 and $1.101 billion at July 31,  1996.   The
Company's  maximum  exposure  under  all  retail  note   recourse
provisions at July 31, 1997 was $142.4 million.

Total  Receivable and Lease amounts 60 days or more past due,  by
product  and  as  a  percentage of total balances  held  were  as
follows (dollars in millions):

                          July 31,     October 31,    July 31,
                           1997           1996          1996
                        -----------------------------------------
                        Dollars   %    Dollars  %    Dollars  %
                        -----------------------------------------
Retail notes:
  Agricultural
    equipment           $ 7.2    .26%  $ 4.4   .18%  $ 5.8   .24%
  Construction
    equipment             2.4    .38     2.5   .39     2.3   .39
  Lawn and grounds
    care equipment         .7    .33      .7   .38      .7   .40
  Recreational products    .1    .01      .3   .03      .3   .03
                        -----          -----         -----
    Total retail notes   10.4    .23     7.9   .19     9.1   .23
Revolving charge
  accounts                9.4   1.54     8.9  1.58     8.3  1.52
Wholesale notes           1.2    .23     1.0   .17      .4   .09
Leases                    2.3    .35     1.7   .38     2.0   .50
                        -----          -----         -----
    Total Receivables
      and Leases        $23.3    .37   $19.5   .35   $19.8   .37
                        =====          =====         =====

The   balance  of  retail  notes  held  (principal  plus  accrued
interest) with any installment 60 days or more past due was $54.3
million,  $47.2  million  and $49.8 million  at  July  31,  1997,
October 31, 1996 and July 31, 1996, respectively.  The balance of
retail  notes  held on which any installment is 60 days  or  more
past  due  as a percentage of ending retail notes receivable  was
1.21  percent,  1.16 percent and 1.25 percent at July  31,  1997,
October 31, 1996 and July 31, 1996, respectively.

During the third quarter and the first nine months of 1997, write-
offs  (net of recoveries) of Receivables and Leases totaled  $6.2
million  and  $20.6  million, respectively,  compared  with  $6.5
million  and  $19.9  million  in  the  same  periods  last  year.
Annualized  write-offs,  as a percentage  of  the  total  average
portfolio outstanding, were .39 percent for the third quarter  of
1997  and .46 percent for the first nine months of 1997, compared
with  .51 percent and .53 percent, respectively, during the  same
periods  last year.  Write-offs relating to retail notes declined
19  percent in the first nine months of 1997, when compared  with
the  first nine months of 1996, primarily due to lower write-offs
of  recreational  product  retail notes and  construction  retail
notes.   Revolving  charge  account,  commercial  wholesale   and
leasing  write-offs  increased during the first  nine  months  of
1997, compared to the first nine months of 1996, primarily due to
volume increases.

                             Page 9

<PAGE>

Deposits withheld from dealers and merchants, representing mainly
the  aggregate dealer retail note and lease withholding  accounts
from  individual John Deere dealers to which losses  from  retail
notes  and leases originating from the respective dealers can  be
charged,  amounted to $134.0 million at July 31,  1997,  compared
with  $135.4  million at October 31, 1996 and $129.0  million  at
July 31, 1996.  The Company's allowance for credit losses on  all
Receivables and Leases financed totaled $89.3 million at July 31,
1997, $87.4 million at October 31, 1996 and $84.1 million at July
31,  1996.  Allowance for credit losses represented 1.42  percent
of  the  balance of Receivables and Leases financed at  July  31,
1997, 1.55 percent at October 31, 1996, and 1.56 percent at  July
31,  1996.   The  Company's allowance for  credit  losses,  as  a
percentage  of total Receivables and Leases, has declined  during
the  last  twelve months due to an ongoing reevaluation  of  loss
experience  and related adjustments to ensure that the  allowance
for credit losses is maintained at an adequate level.  Management
believes  the  allowance for credit losses at July  31,  1997  is
sufficient to provide adequate protection against losses.

Capital Resources and Liquidity

The Company relies on its ability to raise substantial amounts of
funds  to  finance  its  Receivable and  Lease  portfolios.   The
Company's  primary  sources  of funds  for  this  purpose  are  a
combination of borrowings and equity capital.  Additionally,  the
Company periodically sells substantial amounts of retail notes in
the public market and in private sales.  The Company's ability to
obtain  funds is affected by its debt ratings, which are  closely
related to the outlook for and the financial condition of Deere &
Company,  and the nature and availability of support  facilities,
such  as its lines of credit.  For information regarding Deere  &
Company and its business, see Exhibit 99.

The  Company's ability to meet its debt obligations is  supported
in  a  number  of ways as described below.  All commercial  paper
issued is backed by bank credit lines.  The assets of the Company
are  self-liquidating  in nature.  A strong  equity  position  is
available to absorb unusual losses on these assets.  Liquidity is
also  provided  by the Company's ability to sell  and  securitize
these  assets.  Asset-liability risk is also actively managed  to
minimize exposure to interest rate fluctuations.

Total interest-bearing indebtedness amounted to $5.481 billion at
July  31, 1997, compared with $4.898 billion at October 31,  1996
and $4.646 billion at July 31, 1996, generally corresponding with
the  level  of Receivables and Leases financed.  Total short-term
indebtedness  amounted  to  $3.127  billion  at  July  31,  1997,
compared  with  $3.098 billion at October  31,  1996  and  $3.201
billion  at July 31, 1996.  Total long-term indebtedness amounted
to  $2.354 billion, $1.800 billion and $1.445 billion at July  31
1997,  October  31,  1996 and July 31, 1996,  respectively.   The
ratio of total interest-bearing debt to stockholder's equity  was
6.9  to  1,  6.5 to 1 and 6.1 to 1 at July 31, 1997, October  31,
1996  and  July  31, 1996, respectively.  During the  first  nine
months of 1997, the Capital Corporation issued $200 million of 6%
notes  and  $200 million of 6.30% notes, both due  in  1999,  and
retired  $100  million of 7.20% notes due in 1997.  Additionally,
the  Capital  Corporation issued $485 million  and  retired  $478
million  of  medium-term notes during the first  nine  months  of
1997.

At  July 31, 1997, the Capital Corporation, Deere & Company, John
Deere  Limited  (Canada)  and John Deere  Credit  Inc.  (Canada),
jointly,  maintained $4.008 billion of unsecured lines of  credit
with various banks in North America and overseas, $917 million of
which  was  unused.  For the purpose of computing  unused  credit
lines, total short-term borrowings, excluding the current portion
of  long-term  borrowings, of the Capital  Corporation,  Deere  &
Company,  John Deere Limited (Canada) and John Deere Credit  Inc.
(Canada), were considered to constitute utilization.  Included in
the total credit lines is a long-term credit agreement commitment
for  $3.500  billion.   An  annual facility  fee  on  the  credit
agreement  is  charged  to  the  Capital  Corporation  based   on
utilization.

                             Page 10

<PAGE>

The   Company's  business  is  somewhat  seasonal,  with  overall
acquisitions  of Receivables and Leases traditionally  higher  in
the  second half of the fiscal year than in the first  half,  and
overall  collections  of  Receivables  and  Leases  traditionally
somewhat higher in the first half of the fiscal year.

During  the  first  nine months of 1997, the aggregate  net  cash
provided by operating and financing activities was primarily used
to  increase  Receivables  and  Leases.   Net  cash  provided  by
operating activities was $198 million in the first nine months of
1997.  Financing activities provided $530 million during the same
period,  resulting  from a $590 million  net  increase  in  total
borrowings, which was offset by $60 million in dividend  payments
to  John  Deere  Credit  Company.  Net cash  used  for  investing
activities  totaled  $712  million  in  1997,  primarily  due  to
Receivable and Lease acquisitions exceeding collections by $1.172
billion,  partially offset by the $433 million in  proceeds  from
the sale of receivables.  Cash and cash equivalents increased $16
million during the first nine months of 1997.

During  the  first  nine months of 1996, the aggregate  net  cash
provided by operating and financing activities was primarily used
to  increase  Receivables  and  Leases.   Net  cash  provided  by
operating activities was $156 million in the first nine months of
1996.  Financing activities provided $348 million during the same
period,  resulting  from a $383 million  net  increase  in  total
borrowings, which was offset by $35 million in dividend  payments
to  John  Deere  Credit  Company.  Net cash  used  for  investing
activities  totaled  $500  million  in  1996,  primarily  due  to
Receivable and Lease acquisitions exceeding collections by $1.147
billion,  partially offset by the $623 million in  proceeds  from
the sale of receivables.  Cash and cash equivalents increased  $4
million during the first nine months of 1997.

The Capital Corporation paid a cash dividend to John Deere Credit
Company  of  $20 million in each of the first three  quarters  of
1997.   John  Deere Credit Company paid comparable  dividends  to
Deere  &  Company.   On August 29, 1997, the Capital  Corporation
declared  a  cash  dividend of $15 million to John  Deere  Credit
Company, which in turn declared a cash dividend of $15 million to
Deere & Company, each payable on September 9, 1997.

                             Page 11

<PAGE>

                  PART II.    OTHER INFORMATION


Item 1.  Legal Proceedings.

           See Note (5) to the Interim Financial Statements.

Item 2.  Changes in Securities.

           Omitted pursuant to instruction H(2).

Item 3.  Defaults Upon Senior Securities.

           Omitted pursuant to instruction H(2).

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

           Omitted pursuant to instruction H(2).

Item 5.  Other Information.

           None.

Item 6.  Exhibits and Reports on Form 8-K.

           (a)    Exhibits.

                  See the index to exhibits immediately preceding
                  the exhibits filed with this report.

                  Certain instruments relating to long-term debt,
                  constituting less than 10% of the registrant's
                  total assets, are not filed as exhibits
                  herewith pursuant to Item 601(b)(4)(iii)(A) of
                  Regulation S-K.  The registrant will file
                  copies of such instruments upon request of the
                  Commission.

           (b)    Reports on Form 8-K.

                  Current report on Form 8-K dated May 13, 1997
                  (items 5 and 7).

                             Page 12

<PAGE>

                           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.



                               JOHN DEERE CAPITAL CORPORATION
Date: September 4, 1997        By:  /s/ R. W. Lane
                                    --------------------------
                                    R. W. Lane
                                    Vice President
                                   (Principal Financial Officer)










                             Page 13

<PAGE>

                        INDEX TO EXHIBITS



Exhibit                                                 Page No.
-------                                                 --------

(12)  Computation of ratio of earnings to fixed charges    15

(27)  Financial data schedule                              16

(99)  Part I of Deere & Company Form 10-Q for the
      quarter ended July 31, 1997 (Securities and
      Exchange Commission file number 1-4121*).










------------------------------
*    Incorporated by reference.  Copies of these exhibits are
     available from the Company upon request.

                             Page 14