FORM 10-Q

                SECURITIES AND EXCHANGE COMMISSION
                      Washington, D.C.  20549

      [X]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
              OF THE SECURITIES EXCHANGE ACT OF 1934
                                 
           For the quarterly period ended March 31, 1997
                                 
                                OR
                                 
     [  ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
              OF THE SECURITIES EXCHANGE ACT OF 1934
                                 
         For the transition period from _______ to _______


                  Commission file number: 1-10434


               THE READER'S DIGEST ASSOCIATION, INC.
      (Exact name of registrant as specified in its charter)

                   Delaware                   13-1726769
        (State or other jurisdiction of         (I.R.S.
        incorporation or organization)         Employer
                                            Identification
                                                 No.)
                                                   
            Pleasantville, New York           10570-7000
        (Address of principal executive       (Zip Code)
                   offices)
                       

                          (914) 238-1000
       (Registrant's telephone number, including area code)

          ______________________________________________


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 [  ]


As  of  April  30, 1997, the following shares of the registrant's
common stock were outstanding:

Class  A  Nonvoting  Common Stock, $0.01 par  value: 84,489,263 shares
Class B Voting Common Stock, $0.01 par value: 21,716,057 shares

                                                                    
        THE READER'S DIGEST ASSOCIATION, INC. AND SUBSIDIARIES
                                   
                          Index to Form 10-Q
                                   
                            March 31, 1997


Part I - Financial Information                           Page No.

The Reader's Digest Association, Inc. and Subsidiaries
Financial Statements (unaudited):

Consolidated Condensed Statements of Income
for the three and nine-month periods ended March 31, 
1997 and 1996                                                   3

Consolidated Condensed Balance Sheets
as of March 31, 1997 and June 30, 1996                          4

Consolidated Condensed Statements of Cash Flows
for the nine-month periods ended March 31, 1997 and 1996        5

Notes to Consolidated Condensed Financial Statements            6

Management's Discussion and Analysis
 of Financial Condition and Results of Operations               8


Part II - Other Information                                    14


<TABLE>

        THE READER'S DIGEST ASSOCIATION, INC. AND SUBSIDIARIES
              CONSOLIDATED CONDENSED STATEMENTS OF INCOME
      Three and nine-month periods ended March 31, 1997 and 1996
                 (In millions, except per share data)
                              (unaudited)


                            Three-month period ended    Nine-month period ended
                                   March 31,                     March 31, 
                             1997              1996       1997            1996
<C>                         <S>             <S>        <S>           <S>
Revenues                    $  684.3        $  747.5   $ 2,202.9     $ 2,396.6

Product, distribution                                                  
 and editorial expense         237.5           258.2       756.6         821.5
Promotion, marketing                                       
 and administrative            395.3           414.8     1,215.6       1,274.4
 expense
Other operating items             --           245.0         --          245.0
                                                           
Operating profit (loss)         51.5          (170.5)      230.7          55.7

Other income, net                7.7             8.5        15.4          16.4

Income (loss) before                                       
 provision for income           59.2          (162.0)      246.1          72.1
 taxes

Provision (benefit)                                         
 for income taxes               21.6           (48.0)       89.8          37.4

Net income (loss)               37.6          (114.0)      156.3          34.7

Earnings (loss) per share       0.35           (1.06)       1.45          0.31

Average common shares                                            
outstanding                    106.2           107.9       106.8         107.9


See accompanying notes to consolidated condensed financial statements.
</TABLE>


<TABLE>
        THE READER'S DIGEST ASSOCIATION, INC. AND SUBSIDIARIES
                 CONSOLIDATED CONDENSED BALANCE SHEETS
                As of March 31, 1997 and June 30, 1996
                             (In millions)
                              (unaudited)


                                             March 31,   June 30,
                                                1997       1996

<C>                                          <S>        <S>
Assets                                                  
Cash and cash equivalents                    $  192.0   $  258.1
Short-term investments                            5.9       18.9
Receivables, net                                506.9      412.4
Inventories                                     202.6      204.4
Prepaid expenses and other current assets       267.1      310.3

Total current assets                          1,174.5    1,204.1

Marketable securities                            30.0       97.2
Property, plant and equipment, net              242.6      261.5
Other noncurrent assets                         338.1      341.3

Total assets                                 $1,785.2   $1,904.1

Liabilities and stockholders' equity                    
Accounts payable                                171.2      216.0
Accrued expenses                                389.7      457.3
Income taxes payable                             57.2       67.3
Unearned revenue                                398.7      354.9
Other current liabilities                        20.8       17.5

Total current liabilities                     1,037.6    1,113.0

Other noncurrent liabilities                    327.6      312.2

Total liabilities                             1,365.2    1,425.2

Capital stock                                    28.9       28.4
Paid-in capital                                 141.3      138.3
Retained earnings                               995.0      984.0
Foreign currency translation adjustment         (27.3)    (14.2)
Net unrealized losses on certain                 (0.4)     (1.3)
investments
Treasury stock, at cost                        (717.5)   (656.3)

Total stockholders' equity                      420.0      478.9

Total liabilities and stockholders' equity    $1,785.2  $1,904.1


See accompanying notes to consolidated condensed financial statements.
</TABLE>


<TABLE>
        THE READER'S DIGEST ASSOCIATION, INC. AND SUBSIDIARIES
            CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
           Nine-month periods ended March 31, 1997 and 1996
                             (In millions)
                              (unaudited)

                                                Nine-month period
                                                      ended
                                                    March 31,
                                                1997        1996
<C>                                          <S>         <S>
Cash flows from operating activities                     
Net income                                   $  156.3    $   34.7
Depreciation and amortization                    34.4        35.7
Other, net                                     (118.6)       31.5

Net change in cash due to operating              72.1       101.9
activities

Cash flows from investing activities                     
Proceeds from maturities and sales of                    
   short-term investments and marketable        119.1       343.0
securities
Purchases of short-term investments and        (31.3)     (193.6)
marketable securities
Other, net                                     (23.8)      (53.8)

Net change in cash due to investing             64.0        95.6
activities

Cash flows from financing activities                     
Dividends paid                                (145.3)     (141.2)
Common stock repurchased                       (66.3)      (45.5)
Other, net                                      15.3        24.3

Net change in cash due to financing           (196.3)     (162.4)
activities

Effect of exchange rate changes on cash         (5.9)       (1.4)

Net change in cash and cash equivalents        (66.1)        33.7

Cash and cash equivalents at beginning of       258.1       214.6
period
Cash and cash equivalents at end of period      192.0       248.3

See accompanying notes to consolidated condensed financial statements.
</TABLE>


        THE READER'S DIGEST ASSOCIATION, INC. AND SUBSIDIARIES
         NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                             (In millions)
                              (unaudited)

(1)  Basis of Presentation

The  company reports on a fiscal year beginning July 1.  The  three-
month  periods  ended March 31, 1997 and 1996 are the  third  fiscal
quarters of fiscal year 1997 and fiscal year 1996, respectively.

The  accompanying consolidated condensed financial  statements  have
not  been  audited,  but  in the opinion of  management,  have  been
prepared in conformity with generally accepted accounting principles
applying   certain  judgments  and  estimates  which   include   all
adjustments   (consisting  only  of  normal  recurring  adjustments)
considered necessary to present fairly such information.   Operating
results for any interim period are not necessarily indicative of the
results  for an entire year due to the seasonality of the  company's
business.

Certain  prior year amounts in the company's consolidated  condensed
financial  statements have been reclassified  to  conform  with  the
current year's presentation.

(2)  Earnings (Loss) Per Share

Earnings (loss) per share is computed by dividing net income (loss),
less  preferred stock dividend requirements, of $0.3 in each of  the
three-month periods ended March 31, 1997 and 1996 and $1.0  in  each
of  the  nine-month periods ended March 31, 1997  and  1996  by  the
weighted  average  number of common shares  outstanding  during  the
period.

(3)  Inventories
                                            March 31,     June 30,
                                              1997          1996
                                                      
Raw materials                             $   14.5       $   33.0
Work-in progress                              25.7           19.9
Finished goods                               162.4          151.5
                                          $  202.6       $  204.4

(4) Revenues by Business Segments and Geographic Areas


<TABLE>
                             Three-month period     Nine-month period
                                   ended                  ended
                                 March 31,              March 31,
                              1997        1996       1997        1996
<C>                        <S>          <S>         <S>         <S>
BUSINESS SEGMENTS                                             
Reader's Digest Magazine   $  178.3     $ 181.0     $  540.8    $  548.7
Books and Home                461.1       520.2      1,449.3     1,628.6
Entertainment Products
Special Interest Magazines     17.8        22.8         55.5        68.6
Other Businesses               27.1        23.5        157.3       150.7

Total revenues             $  684.3     $ 747.5     $2,202.9    $2,396.6
                                                              
GEOGRAPHIC AREAS                                              
United States              $  308.8     $ 316.7     $  974.6    $1,008.7
Europe                        276.6       328.7        906.2     1,057.3
Pacific and Other Markets      98.9       102.1        322.1       330.6

Total revenues             $  684.3     $ 747.5     $2,202.9    $2,396.6
                                                              
</TABLE>
                                   
                                   
(5) Other Operating Items

As described in Note 2 to the company's consolidated financial
statements included in its 1996 Annual Report to Stockholders, the
company recorded a charge relating primarily to streamlining of the
company's organizational structure and the strategic repositioning of
certain businesses in the third quarter of 1996.  The components of
this charge, as well as reserve balances remaining at March 31, 1997,
were:

                            Total               
                            Charged   Activity   Remaining

Employee retirement &       $104.4     $ 53.3      $ 51.1
severance benefits
Other items                   51.5       36.9        14.6
Business repositioning        48.1       47.2         0.9

Total                       $204.0     $137.4      $ 66.6


(6) Debt

The company entered into a Competitive Advance and Revolving Credit
Facility Agreement dated as of November 12, 1996 with a syndicate of
domestic and foreign banks (the credit agreement).  The credit
agreement, which has a term of five years, permits competitive advance
and revolving credit borrowings of up to $400 by the company and its
designated subsidiaries.  Interest rates can be based on: the prime
rate, the federal funds rate, the London Interbank Offered Rate
(LIBOR), and money market rates.  The proceeds of the borrowings are
to be used for general corporate purposes, including acquisitions,
share repurchases and commercial paper backup. The credit agreement
contains certain restrictions on incurrence of debt, liens and
guarantees of indebtedness.  The company must also comply with certain
financial covenants, including a calculation of consolidated tangible
net worth.  Borrowings may be denominated in U.S. Dollars and various
foreign currencies.  At March 31, 1997, there were no borrowings
outstanding under the credit agreement.

(7) Subsequent Event

In April 1997, the company announced a program to invest up to $400
over the next four years primarily in more aggressive publishing and
promotion initiatives.  In conjunction with the implementation of this
plan, the company expects to record fourth quarter charges of up to
$100 for the realignment of certain business processes and operations.



        The Reader's Digest Association, Inc. and Subsidiaries
                 Management's Discussion and Analysis
           of Financial Condition and Results of Operations
             (Dollars in millions, except per share data)

Results of Operations

Three-Month  Period Ended March 31, 1997 Compared  With  Three-Month
Period Ended March 31, 1996

Worldwide  revenues  for  the third quarter  of  1997  decreased  to
$684.3, or by 8%, compared with $747.5 in the third quarter of 1996.
Excluding the adverse effect of changes in foreign currency exchange
rates,  revenues decreased 7%.  Revenues declined in all  geographic
areas,  particularly  in  the company's  European  operations.   The
decrease  in  revenues was predominantly due to  lower  unit  sales,
lower-priced  product offerings and sales of a lower-priced  product
mix   in   Books   and   Home  Entertainment   Products.    Tactical
implementation of many simultaneous strategic initiatives, including
varying   the  quantity  and  frequency  of  promotional   mailings,
moderating product pricing and introducing greater promotion variety
and  less  aggressive  sweepstakes, along with more  product-focused
offers,  also contributed to lower worldwide revenues in  the  third
quarter of 1997.  The company reported worldwide operating profit of
$51.5 in the third quarter of 1997, compared with an operating  loss
of  $170.5  in  the third quarter of 1996.  The 1996 operating  loss
reflects  charges  for  other operating items  taken  in  the  third
quarter  of  1996 of $245.0 ($169.8 after tax, or $1.57 per  share),
comprised  of $204.0 relating primarily to the streamlining  of  the
company's  organizational structure and the strategic  repositioning
of  certain  businesses  and $41.0 for various  claims  against  the
company.   Excluding the effect of other operating  items  in  1996,
worldwide operating profit decreased by 31% in the third quarter  of
1997  compared  with  the third quarter of  1996.   These  operating
results  reflect lower than anticipated revenues and proportionately
higher related costs in Pacific and Other Markets, and the impact of
the  company's  strategic  actions to restore  long-term  growth  in
Europe,   partially  offset  by  the  benefits  of  cost-containment
initiatives.

The  company reported net income of $37.6, or $0.35 per share in the
third  quarter of 1997, compared with a net loss of $114.0, or $1.06
per  share  in the third quarter of 1996.  Excluding the  effect  of
other  operating  items,  earnings per  share  was  $0.51  in  1996.
Earnings per share declined 31% in 1997, compared with adjusted 1996
results.

Other Income, Net
Other  income, net decreased in the third quarter of 1997  to  $7.7,
compared  with $8.5 in the prior year.  This decrease was  primarily
because  of  lower interest income, lower gains on sales of  certain
investments  and  higher  interest  expense  in  1997,  which   were
partially  offset  by higher gains on foreign exchange  transactions
and hedging activity.

Income Taxes
The  overall effective tax rate was 36.5% for the third  quarter  of
1997 and is expected to remain at this rate for the remainder of the
year.   For the third quarter of 1996, the reported tax benefit  was
at  the rate of 29.7%.  This rate included the tax benefit of  other
operating  items  recorded in the third quarter of  1996.   It  also
included  the re-estimation of the year-to-date effective tax  rate,
excluding other operating items, downward by one percentage point to
35.5%.   The lower effective rate in 1996 was primarily attributable
to favorable settlements relating to prior years.

Geographic Areas

United States
Revenues  in  the  United States decreased from $316.7  in  1996  to
$308.8, or by 2%, in 1997.  This decrease was primarily attributable
to  the  exclusion  of revenues due to the sale  of  Travel  Holiday
magazine  in  the third quarter of 1996.  Also, in 1997,  Books  and
Home  Entertainment Products revenues declined slightly due to lower
unit  sales, which were partially offset by a higher-priced  product
mix.   Within  Books  and Home Entertainment Products,  declines  in
Condensed Books and video products revenues were partially offset by
increased  general books sales.  The higher general  books  revenues
were  primarily  attributable to a more popular product  offered  in
1997.   The  declines  in Condensed Books and  video  products  were
caused  by  lower  Condensed  Book  membership  and  lower  customer
response  to  promotional mailings.  Operating profit  increased  in
1997  compared  with  1996  due to the benefit  of  cost-containment
initiatives.

Europe
Revenues  in Europe decreased from $328.7 in 1996 to $276.6,  or  by
16%,  in  1997.  Excluding the adverse effect of changes in  foreign
currency  exchange  rates,  revenues  decreased  12%.   The  revenue
decrease  was  primarily due to lower-priced product  offerings  and
sales  of a lower-priced product mix and, to a lesser extent,  lower
unit  sales  of Books and Home Entertainment Products.  Within  this
segment  revenues  declined  in  all  product  lines  except   video
products.  Operating profit decreased significantly in 1997 compared
with  1996  as a result of the revenue decrease, which was partially
offset by the benefit of lower product returns and bad debts as well
as  the  continued  successful  implementation  of  cost-containment
initiatives.   Current  year  results  were  also  impacted  by  the
company's ongoing actions to restore long-term growth in this region
and  the  continuing general weakness in European economies.   These
actions include the selective reduction of the number of promotional
mailings  and  mail  quantity  in  a  given  mailing,  variation  of
promotional formats and moderation of product prices.

Pacific and Other Markets
Revenues in Pacific and Other Markets decreased from $102.1 in  1996
to  $98.9,  or  by 3%, in 1997.  Lower Books and Home  Entertainment
Products revenues were partially offset by increased Reader's Digest
magazine  circulation revenues in new countries.  Within  Books  and
Home  Entertainment  Products, the decline in revenues  was  due  to
lower  unit  sales  across most product lines.  Higher  revenues  in
Latin America, reflecting product expansion in Brazil and Argentina,
were  more than offset by significant revenue declines in Australia,
because  of  lower  customer response to promotional  mailings,  and
South  Africa,  because of substantially lower mail  quantities  and
customer  response rates.  Operating results declined  significantly
in 1997 compared with 1996, primarily because of lower than expected
revenues,  higher proportionate promotional spending and  continuing
investments in new country expansion.

Corporate Expense
Corporate expense in 1997 decreased to $8.2, compared with $10.0  in
1996,   due   principally   to  the  benefit   of   cost-containment
initiatives.

Business Segments

Reader's Digest Magazine
Revenues for Reader's Digest Magazine decreased from $181.0 in  1996
to  $178.3, or by 1%, in 1997.  Circulation and advertising revenues
were about even quarter-over-quarter excluding the adverse effect of
changes in foreign currency exchange rates.  Circulation declines in
several  European  countries were offset  by  increased  circulation
levels  in  Latin  America, Eastern Europe and  Thailand.   A  lower
number of advertising pages in Europe were offset by higher pages in
the  United  States  and  Pacific and  Other  Markets.   Circulation
declines in certain European markets, including the company's  major
markets, and the decline of print advertising's share of the overall
European advertising market negatively impacted advertising revenue.
Operating    profit   for   Reader's   Digest   Magazine   decreased
significantly  in the third quarter of 1997 compared with  the  same
period  a  year  ago.   The decrease reflects increased  promotional
spending  and  investments  in  new  countries,  as  well  as  lower
revenues.

Books and Home Entertainment Products
Revenues  for  Books and Home Entertainment Products decreased  from
$520.2   in  1996  to  $461.1,  or  by  11%,  in  1997,  principally
attributable  to  the  company's European operations.   All  product
lines reported lower revenues, predominantly due to lower unit sales
and, to a lesser extent, lower-priced product offerings and sales of
a   lower-priced  product  mix.   Tactical  implementation  of  many
simultaneous  strategic initiatives, including varying the  quantity
and  frequency  of promotional mailings, moderating product  pricing
and  introducing  greater  promotion  variety  and  less  aggressive
sweepstakes, along with more product-focused offers, contributed  to
lower  revenues in the third quarter of 1997.  Operating profit  for
Books  and  Home  Entertainment Products decreased significantly  in
1997  compared with 1996.  These operating results were affected  by
lower  than  anticipated  responses  to  promotional  mailings   and
increased promotional spending in Pacific and Other Markets, and the
impact  of  the  company's strategic actions  to  restore  long-term
growth in Europe.

Special Interest Magazines
Revenues for Special Interest Magazines decreased from $22.8 in 1996
to  $17.8,  or  by  22%,  in  1997.   This  decrease  was  primarily
attributable to the exclusion of revenues due to the sale of  Travel
Holiday in the third quarter of 1996.  Excluding prior year revenues
from  Travel Holiday, revenues increased 11% due almost  equally  to
increased  circulation and advertising revenues.   The  increase  in
circulation  revenues  reflects higher average subscription  prices,
while  the increase in advertising revenues is a result of increased
advertising  pages.   Excluding prior  year  operating  results  for
Travel Holiday, operating performance improved in 1997 compared with
1996 primarily as a result of the higher revenues.

Nine-Month  Period  Ended  March 31, 1997 Compared  With  Nine-Month
Period Ended March 31, 1996

Worldwide  revenues for the nine-month period ended March  31,  1997
decreased to $2,202.9, or by 8%, compared with $2,396.6 for the nine-
month period ended March 31, 1996.  Excluding the adverse effect  of
changes  in foreign currency exchange rates, revenues decreased  7%.
Revenues  declined  in  all geographic areas,  particularly  in  the
company's  European  operations.   The  decrease  in  revenues   was
predominantly due to lower unit sales and, to a lesser extent, lower-
priced product offerings and sales of a lower-priced product mix  in
Books  and Home Entertainment Products.  Tactical implementation  of
many  simultaneous  strategic  initiatives,  including  varying  the
quantity  and frequency of promotional mailings, moderating  product
pricing   and  introducing  greater  promotion  variety   and   less
aggressive sweepstakes, along with more product-focused offers, also
contributed   to  lower  worldwide  revenues  in  1997.    Worldwide
operating profit increased to $230.7 in the nine-month period  ended
March  31, 1997, compared with $55.7 in the nine-month period  ended
March  31,  1996.   The  1996  results  reflect  charges  for  other
operating items taken in the third quarter of 1996 of $245.0 ($169.8
after  tax,  or  $1.57 per share).  Excluding the  effect  of  other
operating items in 1996, worldwide operating profit decreased by 23%
in  the  nine-month period ended March 31, 1997, compared  with  the
same  period a year ago.  These operating results reflect the impact
of  the  company's strategic actions to restore long-term growth  in
Europe  and higher proportionate costs in Pacific and Other Markets,
partially offset by the benefits of cost-containment initiatives.

The company reported net income of $156.3, or $1.45 per share in the
nine-month  period  ended March 31, 1997, compared  with  $34.7,  or
$0.31  per  share  in the nine-month period ended  March  31,  1996.
Excluding  the effect of other operating items, earnings  per  share
was  $1.89  in  1996.   Earnings per share  declined  23%  in  1997,
compared with adjusted 1996 results.

Other Income, Net
Other  income,  net for the nine-month period ended March  31,  1997
decreased  to $15.4, compared with $16.4 a year ago.  This  decrease
was  primarily because of lower interest income and higher  interest
expense  in  1997, which were partially offset by  higher  gains  on
foreign exchange transactions and hedging activity.

Income Taxes
The overall effective tax rate for nine-month period ended March 31,
1997  was  36.5%,  and is expected to remain at this  rate  for  the
remainder  of the year, compared with a reported rate of  51.8%  for
the nine-month period ended March 31, 1996.  Excluding the effect of
other operating items, the effective tax rate was 35.5% for the nine-
month period ended March 31, 1996.  The lower effective rate in 1996
was  primarily  attributable to favorable  settlements  relating  to
prior years.

Geographic Areas

United States
Revenues  in the United States decreased from $1,008.7  in  1996  to
$974.6, or by 3%, in 1997.  This decrease was primarily attributable
to  lower  unit  sales  in  Books and Home  Entertainment  Products.
Revenues  were also adversely affected by the exclusion of  revenues
due  to the sale of Travel Holiday magazine in the third quarter  of
1996.  Within Books and Home Entertainment Products, the lower  unit
sales  were  principally caused by declines in Condensed  Books  and
music products.  The decrease in Condensed Books sales was caused by
lower  customer response to promotional offers and lower  membership
retention  rates.  Music products declined primarily  due  to  lower
customer   response  to  promotional  mailings.   Operating   profit
decreased  in  1997  compared with 1996 due to  lower  revenues  and
timing  of  expenses  partially  offset  by  the  benefit  of  cost-
containment initiatives.

Europe
Revenues in Europe decreased from $1,057.3 in 1996 to $906.2, or  by
14%,  in  1997.  Excluding the adverse effect of changes in  foreign
currency  exchange rates, revenues decreased 11%.  The  decrease  in
revenues  was  primarily due to lower unit sales and,  to  a  lesser
extent,  lower-priced product offerings and sales of a  lower-priced
product mix within Books and Home Entertainment Products.  Operating
profit  decreased significantly in 1997 compared with 1996.  Current
year  results  were  affected by the company's  ongoing  actions  to
restore  long-term growth in this region and the continuing  general
weakness in European economies.  These actions include the selective
reduction of the number of promotional mailings and mail quantity in
a given mailing, variation of promotional formats, and moderation of
product prices.  The impact of these actions was partially offset by
the  benefit  of  lower  product returns  and  bad  debts,  and  the
implementation of cost-containment initiatives.

Pacific and Other Markets
Revenues in Pacific and Other Markets decreased from $330.6 in  1996
to  $322.1,  or by 3%, in 1997.  This decrease was caused  by  lower
Books  and  Home Entertainment Products revenues; however, increased
Reader's  Digest  magazine  circulation revenues  in  new  countries
offset  more than one-half of this decline.  Within Books  and  Home
Entertainment  Products, the decline in revenues was due  to  lower-
priced product offerings and sales of a lower-priced product mix, as
well as lower unit sales in 1997.  Higher revenues in Latin America,
reflecting  product expansion in Argentina and Brazil,  were  offset
primarily  by significant revenue declines in South Africa,  because
of  substantially lower mail quantities and customer response rates,
including  the  effect  of promotional mailing  variations,  and  in
Australia,  due to lower customer response to promotional  mailings.
Operating profit decreased significantly in 1997 compared with 1996,
primarily   because   of  lower  than  expected   revenues,   higher
proportionate  promotional spending, and continuing  investments  in
new country expansion.

Corporate Expense
Corporate expense in 1997 decreased to $32.7 compared with $38.9  in
1996  due principally to the benefit of cost-containment initiatives
and the timing of expenses.

Business Segments

Reader's Digest Magazine
Revenues for Reader's Digest Magazine decreased from $548.7 in  1996
to  $540.8, or by 1%, in 1997.  Circulation and advertising revenues
were  about  even  year-over-year excluding the  adverse  effect  of
changes  in  foreign  currency exchange rates.   Within  advertising
revenues, higher advertising rates per page were offset by  a  lower
number  of advertising pages sold.  Increased circulation levels  in
Latin   America,  Eastern  Europe  and  Thailand  were   offset   by
circulation  declines in several European countries and  the  United
States.   Operating  profit for Reader's Digest  Magazine  decreased
significantly in the nine-month period ended March 31, 1997 compared
with  the  same  period  a  year ago.  The decrease  reflects  lower
revenues,  increased  promotional spending and  investments  in  new
countries,  partially  offset  by the  benefit  of  cost-containment
initiatives.

Books and Home Entertainment Products
Revenues  for  Books and Home Entertainment Products decreased  from
$1,628.6  in  1996  to  $1,449.3, or by  11%  in  1997,  principally
attributable  to  the  company's European operations.  Most  product
lines  reported significantly lower revenues, primarily due to lower
unit  sales and, to a lesser extent, lower-priced product  offerings
and sales of a lower-priced product mix.  Tactical implementation of
many  simultaneous  strategic  initiatives,  including  varying  the
quantity  and frequency of promotional mailings, moderating  product
pricing   and  introducing  greater  promotion  variety   and   less
aggressive  sweepstakes,  along with  more  product-focused  offers,
contributed to lower revenues in 1997.  Operating profit  for  Books
and  Home  Entertainment Products decreased  significantly  in  1997
compared  with 1996.  These operating results were affected  by  the
impact  of  the  company's strategic actions  to  restore  long-term
growth  in  Europe, lower than anticipated responses to  promotional
mailings  in Pacific and Other Markets, and lower customer  response
to   Condensed  Books  promotional  mailings  and  lower  membership
retention rates.

Special Interest Magazines
Revenues for Special Interest Magazines decreased from $68.6 in 1996
to  $55.5,  or  by  19%,  in  1997.   This  decrease  was  primarily
attributable to the exclusion of revenues due to the sale of  Travel
Holiday  in the third quarter of 1996. Excluding prior year revenues
from  Travel Holiday, revenues increased 6% due primarily to  higher
advertising  revenues  as  a result of increased  advertising  pages
sold.   Operating  performance improved in 1997 compared  with  1996
primarily reflecting the increase in advertising revenues.
Forward-Looking Information

The  company has launched a program to invest up to $400  over  four
years   primarily  in  more  aggressive  publishing  and   promotion
initiatives.   The majority of this spending will negatively  impact
future  operating results, particularly in fiscal 1998; however,  in
fiscal  1999  and 2000 it is expected that operating results  should
improve  compared  to  1998 as the effect of the  spending  will  be
offset by the returns from these initiatives.  The objective of  the
plan is to stabilize the erosion of the company's customer base  and
to  grow the number and maximize the lifetime value of the company's
customers  through  the  retention of  existing  customers  and  the
generation  of  new and younger customers.  The plan also  seeks  to
expand the development of new products based upon the identification
of  emerging  consumer  trends and interests,  and  to  expand  into
additional  direct marketing selling channels.  The  plan  comprises
various  projects, including increased implementation of  innovative
promotional   programs,   selective  programs   to   improve   price
competitiveness, and the continued upgrading and automation  of  the
infrastructure  of the company.  These initiatives are  expected  to
produce  customer-driven  revenue growth and  increased  shareholder
value  over  the  long-term.  The long-term goals of the  investment
program  are:  percentage customer growth in the low single  digits,
percentage  revenue growth in the high single digits, and  operating
profit  growth  and  operating margins in a sustainable  10  percent
range.

As  part  of the strategy associated with the investment  plan,  the
company  is  internally shifting its focus away from the traditional
measure  of performance -- earnings per share -- toward more  value-
based  measures, including: growth in number of customers, retention
of  customers,  conversion of customers to  multi-product  long-term
buyers,  generation  of  new and younger customers,  and  growth  in
revenues, operating profit and cash flows.

In  conjunction with the implementation of the investment plan,  the
company  expects  to  record  fourth  quarter  charges  up  to  $100
primarily  for  the  realignment of certain business  processes  and
operations.   The  company anticipates that  full-year  fiscal  1997
earnings  per  share  will be in the range of $1.70,  excluding  any
fourth quarter charges, as a result of lower than expected responses
to  many  of the third quarter promotional mailings in most markets.
Continuing  weakness of European economies has also  contributed  to
the   recovery  of  these  markets  taking  longer  than  previously
expected.   Operating results for fiscal 1998  are  expected  to  be
below  1997  levels, due to the continued effect  of  the  foregoing
factors,  the lack of customer- and revenue-led growth  momentum  in
the business and spending related to the investment plan.

The    company's   continuing   strategy   involves   the   tactical
implementation  of many simultaneous initiatives  which  vary  on  a
country  by  country  basis.  Such initiatives include  varying  the
quantity  and frequency of promotional mailings, moderating  product
pricing,  introducing greater promotion variety and less  aggressive
sweepstakes,  along with more product-focused offers.   The  company
has  experienced  lower  response rates than anticipated  to  recent
promotional  mailings  and believes that  these  results  have  been
affected  by  the implementation of these initiatives.  The  company
believes  these actions are essential to reducing customer  fatigue,
attracting  and  retaining  new  customers  and  renewing  long-term
customer satisfaction to build enduring value for shareholders.  The
company will continue to refine its strategy as necessary.

The  statements  contained in this report, if  not  historical,  are
forward-looking  statements, which involve risks  and  uncertainties
that  could  cause  actual  results to differ  materially  from  the
financial  results  described  in  the  forward-looking  statements.
These risks and uncertainties include the level and rate of progress
in  the  company's program to stabilize and restore  growth  in  its
operations, the effect of worldwide paper and postage costs, and the
ability  of the company to achieve earnings per share growth through
internal  investment, strategic alliances, joint ventures and  other
methods.   The success of the company's program is in turn dependent
on  factors  such  as  the effectiveness of the company's  marketing
strategies  to  stabilize  and grow its customer  base  and  improve
customer  response  rates, especially the  impact  of  modified  and
varied  promotional formats on customer responses,  the  ability  to
identify customer trends, the ability to expand into new channels of
distribution,  the effectiveness of selective price reductions,  the
cost  and effectiveness of upgrading the automation of the company's
infrastructure,  as  well  as the appeal of  the  company's  mix  of
products,  the  accuracy of management's assessment of  the  current
status  of  the  company's business, the evolution of the  company's
organizational  and  structural capabilities, and  general  economic
conditions.

Liquidity and Capital Resources

Cash  and  cash  equivalents, short-term investments and  marketable
securities  decreased $146.3 to $227.9 at March  31,  1997  compared
with  June  30,  1996.  The decrease was primarily due  to  dividend
payments  of  $145.3 and the repurchase of Class A nonvoting  common
stock, at a cost of $66.3, exceeding cash provided by operations  of
$72.1.

In both the third quarter of 1997 and 1996, the company paid a $0.45
per  share  dividend on its common stock.  At the current rate,  the
annualized  dividend will be $1.80 per share in 1997  compared  with
$1.75 in 1996.

In October 1996, the company's Board of Directors approved a program
to  purchase  up  to  5.0 million shares of the  company's  Class  A
nonvoting  common stock.  The company repurchased approximately  1.7
million  shares of Class A nonvoting common stock in the  nine-month
period  ended  March 31, 1997. From the announcement  of  its  first
repurchase  program  in February 1992 through March  31,  1997,  the
company has repurchased approximately 16.8 million shares of Class A
nonvoting   common   stock,   leaving  an   authorized   amount   of
approximately  4.2  million  shares  remaining  under  the   current
program.

The  company entered into a Competitive Advance and Revolving Credit
Facility Agreement dated as of November 12, 1996 with a syndicate of
domestic  and  foreign  banks (the credit  agreement).   The  credit
agreement,  which  has  a  term of five years,  permits  competitive
advance and revolving credit borrowings of up to $400 by the company
and  its  designated subsidiaries.  Interest rates can be based  on:
the prime rate, the federal funds rate, the London Interbank Offered
Rate  (LIBOR),  and  money  market  rates.   The  proceeds  of   the
borrowings are to be used for general corporate purposes,  including
acquisitions,  share repurchases and commercial paper  backup.   The
credit  agreement  contains certain restrictions  on  incurrence  of
debt,  liens and guarantees of indebtedness.  The company must  also
comply with certain financial covenants, including a calculation  of
consolidated   tangible  net  worth.   There  were   no   borrowings
outstanding under the credit agreement.

The  company  believes that its liquidity, capital  resources,  cash
flow  and  borrowing capacity are sufficient to fund normal  capital
expenditures, working capital requirements, the payment of dividends
and  the  company's  share  repurchase program.   The  company  also
believes  its liquidity, capital resources, cash flow and  borrowing
capacity  are sufficient to finance present plans to expand existing
product  lines  in  existing markets, to identify  and  develop  new
products and markets and to enter into strategic alliances and  make
small acquisitions.


                      PART II.  OTHER INFORMATION


Item 6.   EXHIBITS AND REPORTS ON FORM 8-K.

(a)  Exhibits

     27   Financial Data Schedule.  [1 page]

(b)  Reports on Form 8-K

     The  company filed a report on Form 8-K on March 31,  1997  which
     included  a  copy of a press release advising that the  company's
     1997 third quarter and fiscal year earnings would be below market
     expectations.
     
     The  company filed a report on Form 8-K on April 23,  1997  which
     included  a  copy  of  a press release containing  the  company's
     financial  results for the quarter ended March 31,  1997,  and  a
     copy  of  a  press release announcing the company's $400  million
     investment program.


                              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.



                                        The Reader's Digest Association, Inc.
                                        (Registrant)



Date:  May 12, 1997               By: /s/ Stephen R. Wilson
                                          Stephen R. Wilson
                                          Executive Vice President and
                                          Chief Financial Officer
                                          (and authorized signatory)
 

                                   
                         EXHIBIT INDEX
                                                              
Exhibit                                                     Page

27           Financial Data Schedule.