CONFORMED COPY

                              FIRST AMENDMENT dated as of
               September 17, 1997 (the "Amendment"), to the
               US$400,000,000 Competitive Advance and
               Revolving Credit Facility Agreement dated as
               of November 12, 1996 (the "Agreement"), among
               THE READER'S DIGEST ASSOCIATION, INC., as a
               Borrower and as the Guarantor (each as
               defined therein), the Borrowing Subsidiaries
               (as defined therein), the Lenders (as defined
               therein), THE CHASE MANHATTAN BANK, as
               Administrative Agent, and J.P. MORGAN
               SECURITIES INC., as Syndication Agent.


          The Borrowers (as defined in the Agreement) have
requested that the Lenders amend the net worth covenant of
the Agreement, and pursuant to Section 10.02(b) of the
Agreement, the Required Lenders are willing, on the terms
and subject to the conditions set forth below, to amend such
covenant as provided herein.  Accordingly, in consideration
of the mutual agreements herein contained and other good and
valuable consideration, the sufficiency and receipt of which
are hereby acknowledged, the parties hereto hereby agree as
follows:

          SECTION 1.  Definitions.  Capitalized terms used
and not otherwise defined herein shall have the meanings
assigned to them in the Agreement.

          SECTION 2.  Amendments.  Section 6.07 of the
Agreement is hereby amended by deleting such section in its
entirety and substituting, as of the Effective Date (as
defined in Section 4 herein), the following:

          "SECTION 6.07.  Consolidated Tangible Net Worth.
     The Company will not permit Consolidated Tangible Net
     Worth at any time to be less than the amount set forth
     below for the time period set forth below:

                                   
                                        Consolidated
                                          Tangible
            Time Period                  Net Worth
                                   
     Until June 30, 1998:               $175,000,000
                                   
     On and after June 30, 1998    
     until December 31, 1998:           $200,000,000
                                   
     On and after December 31,     
     1998 until and on December    
     31, 1999:                          $250,000,000
                                   
     After December 31, 1999:          $300,000,000".
          

          SECTION 3.  Representations and Warranties.  The
Company represents and warrants to each of the Lenders that:

          (a)  This Amendment has been duly authorized,
executed and delivered by it and constitutes a legal, valid
and binding obligation of the Company, enforceable in
accordance with its terms, except as enforcement thereof may
be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting
the enforceability of creditors' rights generally and by
general principles of equity.

          (b)  The representations and warranties set forth
in Article IV of the Agreement are true and correct with the
same effect as if made on the date hereof, except to the
extent such representations and warranties expressly relate
to an earlier date, in which case they were true and correct
in all material respects on and as of such earlier date.

          (c)  Before and after giving effect to this
Amendment, no Default has occurred and is continuing.

          SECTION 4.  Conditions to Effectiveness.  This
Amendment shall become effective when each of the following
conditions is satisfied:

          (a) The Administrative Agent (or its counsel)
shall have received counterparts of the Amendment signed by
each of the Company and the Required Lenders (such date
being herein called the "Effective Date").

          (b) The Administrative Agent shall have received,
on behalf of itself and the Lenders, a favorable written
opinion of Clifford H.R. DuPree, Associate General Counsel
of the Company, addressed to the Administrative Agent and
the Lenders, dated the Effective Date and covering such
matters relating to the Company, this Amendment and the
Transactions as the Administrative Agent may reasonably
request.

          (c) The Administrative Agent shall have received a
certificate, dated the Effective Date, signed by a Financial
Officer of the Company to the effect set forth in
clauses (b) and (c) of Section 3.

          (d) The Administrative Agent shall have received
all documents it may reasonably request relating to the
existence or good standing of the Company or any other
Borrower or the Guarantor, the corporate power and authority
of the Company and any such other Borrower or the Guarantor
to enter into and the validity of this Amendment and the
other Loan Documents, and any other matters relevant hereto,
all in form and substance satisfactory to the Administrative
Agent.

          (e) The Lenders shall have received the upfront
fees referred to in clause (a) of Section 7 below.

          SECTION 5.  Applicable Law.  THIS AMENDMENT SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK.

          SECTION 6.  Counterparts.  This Amendment may be
executed in any number of counterparts, each of which shall
constitute an original but all of which when taken together
shall constitute but one agreement.  Counterparts of this
Amendment may be delivered via telecopy transmission with
the same effect as the delivery of a manually executed
counterpart.

          SECTION 7.  Fees and Expenses.  The Company shall
pay (a) upfront fees to all the Lenders in connection with
this Amendment, allocated pro rata among the Lenders in
accordance with their respective Commitments, as previously
agreed upon by the Lenders and the Company and (b) all
reasonable out-of-pocket expenses incurred by the
Administrative Agent in connection with the preparation,
execution and delivery of this Amendment, including but not
limited to the reasonable fees, charges and disbursements of
Cravath, Swaine & Moore, counsel for the Administrative
Agent.

          SECTION 8.  Agreement.  Except as specifically
amended or modified hereby, the Agreement shall continue in
full force and effect in accordance with the provisions
thereof.  As used therein, the terms "Agreement", "herein",
"hereunder", "hereinafter", "hereto", "hereof" and words of
similar import shall, unless the context otherwise requires,
refer to the Amendment.


          IN WITNESS WHEREOF, the parties hereto have caused
this Amendment to be duly executed by their duly authorized
officers, all as of the date first above written.

                              THE READER'S DIGEST
                              ASSOCIATION, INC.
                              
                           By
                           /s/: Craig T. Monaghan
                           Name:  Craig T. Monaghan
                           Title: Vice President &
                           Treasurer
                         
                            Guarantor:
                            THE READER'S DIGEST ASSOCIATION, INC.
                             
                            By
                            /s/: Craig T. Monaghan
                            Name:   Craig T. Monaghan
                            Title:   Vice President &
                            Treasurer
                              
                              THE CHASE MANHATTAN BANK,
                              individually and as
                              Administrative Agent
                              
                              By
                              /s/: Carol A. Ulmer
                              Name:  Carol A. Ulmer
                              Title: Vice President
                              
                              J. P. MORGAN SECURITIES INC.,
                              as Syndication Agent
                              
                              By
                             /s/: Stephen Kenneally
                              Name:  Stephen Kenneally
                              Title: Vice President
                              
                              MORGAN GUARANTY TRUST COMPANY
                              By
                              /s/: Deborah A. Brodheim
                              Name:  Deborah A. Brodheim
                              Title: Vice President

                              BARCLAYS BANK PLC
                              By
                              /s/: Terance Bullock
                              Name:  Terrance Bullock
                              Title: Associate Director

                              CITIBANK, N.A.
                              By
                              /s/: Theodore J. Beck
                              Name:  Theodore J. Beck
                              Title: Attorney in Fact

                              COMMERZBANK AG, New York
                              and/or Grand Cayman Branches
                              By
                              /s/: Subash R. Viswanathan
                              Name:  Subash R. Viswanathan
                              Title: Vice President

                              By
                              /s/: Peter T. Doyle
                              Name:  Peter T. Doyle
                              Title: Assitant Treasurer

MELLON BANK, N.A.

By
   /s/: David McGowan
  Name:  David McGowan
  Title: Vice President

ISTITUTO BANCARIO SAN PAOLO DI TORINO
By
   /s/: Gerard M. McKenna
  Name:  Gerard M. McKenna
  Title: Vice President
By
  /s/: Robert Wurster
  Name:  Robert Wurster
 Title: 1st Vice President

NATIONAL WESTMINSTER BANK PLC, NEW YORK BRANCH
By /s/: Christopher Fahey
  Name:  Christopher Fahey
  Title: Assistant Vice President
By/s/: Angela Bozorgmir
  Name:  Angela Bozorgmir
  Title: Vice President

THE SUMITOMO BANK, LIMITED, NEW YORK BRANCH
By/s/: John C. Kissinger
  Name:  John C. Kissinger
  Title: Joint General Manager

SVENSKA HANDELSBANKEN
By/s/: Geoffrey  Walker
  Name:  Geoffrey Walker
  Title: Senior Vice President
By/s/: Karl Forsman
  Name:  Karl Forsman
  Title: Vice President

UNION BANK OF SWITZERLAND, NEW YORK BRANCH
By/s/: Eduardo Salazar
  Name:  Eduardo Salazar
  Title: Director
By/s/: Stephen A. Cayer
  Name:  Stephen A. Cayer
  Title: Assitant Vice President

ABN AMRO BANK N.V., NEW YORK BRANCH
By /s/: Frances OR Logan
  Name:  Frances OR Logan
  Title: Group Vice President

By /s/: R. Scott Boras
  Name:  R. Scott Boras
  Title: Assistant Vice President

THE FUJI BANK, LIMITED, NEW YORK BRANCH

By /s/: Raymond Ventura
  Name:  Raymond Ventura
  Title: Vice President & Manager

ING BANK N.V.

By   /s/: F.J. Dubbe
  Name:  F.J. Dubbe
  Title: Legal Counsel

By   /s/: W.E.J. Stut
  Name:  W.E.J. Stut
  Title: Head Legal Department


CIBC INC.

By   /s/: Pamela H. Friedman
  Name:  Pamela H. Friedman
  Title: Director