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 September 30, 1996
                                   
                                  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. Employer
          incorporation or organization)          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  October  31, 1996, the following shares of  the  registrant's
common stock were outstanding:

Class A Nonvoting Common Stock, $0.01 par value:  85,566,616 shares
Class B Voting Common Stock, $0.01 par value:     21,716,057 shares



                                                 Page 1 of 14 pages.
                                                                    
                                   
                 THE READER'S DIGEST ASSOCIATION, INC.
                                   
                          Index to Form 10-Q
                                   
                          September 30, 1996


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-month periods ended September 30, 1996 and 1995        3

 Consolidated Condensed Balance Sheets
  as of September 30, 1996 and June 30, 1996                           4

 Consolidated Condensed Statements of Cash Flows
  for the three-month periods ended September 30, 1996 and 1995        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                                           11

                                   
        THE READER'S DIGEST ASSOCIATION, INC. AND SUBSIDIARIES
              CONSOLIDATED CONDENSED STATEMENTS OF INCOME
         Three-Month periods ended September 30, 1996 and 1995
                 (In millions, except per share data)
                              (unaudited)



                                                Three-Month period ended
                                                     September 30,
                                                   1996            1995

Revenues                                      $ 644.0          $ 730.5

Product, distribution and editorial expense     221.7            250.9
Promotion, marketing and administrative         375.7            397.8
expense
                                                               
Operating profit                                 46.6             81.8

Other income, net                                 8.0              3.1

Income before provision for income taxes         54.6             84.9
                                                               
Provision for income taxes                       20.0             31.0

Net income                                    $  34.6          $  53.9

Earnings per share                            $  0.32          $  0.50

Average common shares outstanding               107.4            108.0


See accompanying notes to consolidated condensed financial statements.

                                   
        THE READER'S DIGEST ASSOCIATION, INC. AND SUBSIDIARIES
                 CONSOLIDATED CONDENSED BALANCE SHEETS
              As of September 30, 1996 and June 30, 1996
                             (In millions)
                              (unaudited)


                                              September 30,      June 30,
                                                   1996            1996
Assets                                                        
Cash and cash equivalents                     $ 127.1         $  258.1
Short-term investments                           23.3             18.9
Receivables, net                                494.8            412.4
Inventories                                     228.7            204.4
Prepaid expenses and other current assets       302.6            310.3

Total current assets                          1,176.5          1,204.1

Marketable securities                            85.2             97.2
Property, plant and equipment, net              256.3            261.5
Other noncurrent assets                         361.0            341.3

Total assets                                 $1,879.0        $ 1,904.1

Liabilities and stockholders' equity                          
Accounts payable                             $  203.8         $  216.0
Accrued expenses                                441.7            457.3
Income taxes payable                             68.6             67.3
Unearned revenue                                366.9            354.9
Other current liabilities                        20.6             17.5

Total current liabilities                     1,101.6          1,113.0

Other noncurrent liabilities                    338.2            312.2

Total liabilities                             1,439.8          1,425.2

Capital stock                                    28.6             28.4
Paid-in capital                                 138.9            138.3
Retained earnings                               969.9            984.0
Foreign currency translation adjustment         (14.0)           (14.2)
Net unrealized losses on certain investments     (1.1)            (1.3)
Treasury stock, at cost                        (683.1)          (656.3)
Total stockholders' equity                      439.2            478.9

Total liabilities and stockholders' equity    $1,879.0       $ 1,904.1


See accompanying notes to consolidated condensed financial statements.

                                   
        THE READER'S DIGEST ASSOCIATION, INC. AND SUBSIDIARIES
            CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
         Three-Month periods ended September 30, 1996 and 1995
                             (In millions)
                              (unaudited)

                                                   Three-Month period ended
                                                           September 30,
                                                        1996           1995
Cash flows from operating activities                             
Net income                                          $   34.6        $   53.9
Depreciation and amortization                           11.9            11.7
Other, net                                            (112.8)          (97.7)

Net change in cash due to operating activities         (66.3)          (32.1)

Cash flows from investing activities                             
Proceeds from maturities and sales of                            
short-term investments and marketable securities        22.9           181.2
Purchases of short-term investments and                 (6.4)          (76.6)
marketable securities
Other, net                                              (3.5)          (25.4)

Net change in cash due to investing activities           13.0           79.2

Cash flows from financing activities                             
Dividends paid                                         (48.7)          (43.6)
Common stock repurchased                               (27.7)          (26.0)
Other, net                                              (1.4)           (6.7)

Net change in cash due to financing activities         (77.8)          (76.3)

Effect of exchange rate changes on cash                  0.1            (0.6)

Net change in cash and cash equivalents               (131.0)          (29.8)

Cash and cash equivalents at beginning of period       258.1           214.6
Cash and cash equivalents at end of period          $  127.1         $ 184.8


See accompanying notes to consolidated condensed financial statements.

                                   
        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 September 30, 1996, and  1995  are  the  first
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.

(2)  Earnings Per Share

Earnings  per  share  is  computed  by  dividing  net  income,  less
preferred stock dividend requirements, of $0.3 in each of the three-
month  periods  ended September 30, 1996 and 1995  by  the  weighted
average number of common shares outstanding during the period.


(3)  Inventories
                                             September 30,     June 30,
                                                  1996           1996
                                                              
Raw materials                               $   24.7           $   33.0
Work-in progress                                24.0               19.9
Finished goods                                 180.0              151.5
                                            $  228.7           $  204.4



(4)  Revenues by Business Segments and Geographic Areas

                                              Three-Month period ended
                                                   September 30,
                                                  1996           1995
BUSINESS SEGMENTS                                             
Reader's Digest Magazine                    $  174.9          $  177.4
Books and Home Entertainment Products          439.2             515.5
Special Interest Magazines                      15.7              20.0
Other Businesses                                14.2              17.6

Total revenues                              $  644.0          $  730.5

GEOGRAPHIC AREAS                                              
United States                               $  269.5          $  289.7
Europe                                         275.6             337.7
Pacific and Other Markets                       98.9             103.1

Total revenues                              $  644.0          $  730.5


                                   
(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 September 30,
1996 , were:

                
                                              Total                       
                                            Charged    Utilized     Remaining
Employee retirement & severance benefits     $104.4     $ 52.6        $ 51.8
Other items                                    51.5       18.0          33.5
Business repositioning                         48.1       21.6          26.5

Total                                        $204.0     $ 92.2        $111.8

                                   
        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 September 30, 1996 Compared  With  Three-
Month Period Ended September 30, 1995

Worldwide  revenues for the three-month period ended  September  30,
1996  decreased to $644.0, or by 12%, compared with  $730.5  in  the
three-month  period ended September 30, 1995.  Revenues declined  in
all   geographic  areas,  particularly  in  the  company's  European
operations.  The decrease in revenues was predominantly due to lower
unit  sales  in  the Books and Home Entertainment Products  segment.
Worldwide  operating profit decreased to $46.6, or by  43%,  in  the
first  quarter of 1997, compared with $81.8 in the first quarter  of
1996.   These  results reflect the adverse impact  of  reduced  mail
quantities in the company's European operations, execution  problems
in  certain United States promotional mailings in the first  quarter
of  1997,  as  well as lower customer response rates.   While  lower
revenues  and  operating profit were expected  to  result  from  the
company's  strategic actions, revenues declined more than  expected.
The  company believes that the  deliberate shift to less  aggressive
sweepstakes   promotional  copy  and  more  product-focused   offers
contributed  to  lower  customer  response  rates,  which  in   turn
contributed  to  the  revenue  decline.   Also  adversely  affecting
operating  profit  in  the  first quarter  of  1997  was  investment
spending   on   initiatives  to  increase  customer  counts;   these
initiatives have historically been spread more evenly throughout the
year.

The  company reported net income of $34.6, or $0.32 per share in the
first  quarter of 1997, compared with $53.9, or $0.50 per  share  in
the first quarter of 1996.

Other Income, Net
Other  income, net increased in the first quarter of 1997  to  $8.0,
compared with $3.1 a year ago.  This increase was primarily  because
of  higher  gains  on  the  sales of  certain  investments  in  1997
partially offset by lower interest income.

Income Taxes
The  overall  effective tax rate is 36.5% for the first  quarter  of
1997 and the first quarter of 1996. The company anticipates that the
effective  tax  rate will remain at 36.5% for the remainder  of  the
year.

Geographic Areas

United States
Revenues  in  the  United States decreased from $289.7  in  1996  to
$269.5,  or  by 7%, in 1997.  Approximately 5% of this decrease  was
attributable  to  lower unit sales in Books and  Home  Entertainment
Products.   Revenues were also adversely affected  by  the  sale  of
Travel  Holiday magazine in the third quarter of 1996. Within  Books
and   Home   Entertainment  Products,  the  lower unit sales were
attributable to Condensed Books, music products and video  products.
During  the  first  quarter  of  1997 the  company's  United  States
operations  experienced execution problems for certain music,  video
and  general  book  offers related to the 1996  downsizing  and  the
transition  to new lettershop and fulfillment vendors.   The decline 
in Condensed Books was caused by lower customer response  to
promotional  offers  and  lower  membership  retention  rates.   The
company   believes  that  the  use  of  repetitive  promotion   copy
contributed   to   this   decline.    Operating   profit   decreased
significantly  in  1997 compared with 1996 due  to  lower  revenues,
timing  of  promotional  expenses and increased  investment  in  new
initiatives,  partially offset by the benefit  of   cost-containment
initiatives.

Europe
Revenues  in Europe decreased from $337.7 in 1996 to $275.6,  or  by
18%,  in  1997, primarily due to lower unit sales of Books and  Home
Entertainment Products. Operating profit decreased significantly  in
1997  compared  with  1996.   These results  reflect  the  company's
ongoing  restaging  of its European operations, and  the  continuing
general weakness in European economies. The company has been  taking
actions that are affecting short-term revenues and profits in  order
to  restore  long-term  customer and revenue growth.  These  actions
include the intentional reduction of the number of mailings and mail
quantity in a given mailing, with the subsequent short-term decrease
in  orders;  modification  and  variation  of  promotional  formats,
resulting  in initial lower customer response rates but expected  to
lead  to  long-term  improvements in  rejects  and  bad  debts;  and
moderation  of  product prices and investment  in  new  distribution
channels.


Pacific and Other Markets
Revenues in Pacific and Other Markets decreased from $103.1 in  1996
to  $98.9,  or  by 4%, in 1997.  This decrease was caused  by  lower
Books  and  Home Entertainment Products revenues; however  increased
Reader's  Digest magazine circulation revenues offset  approximately
one-half  of this decline.  The decline in revenues was largely  due
to  the impact of lower mail quantities and customer response rates,
including the effect of variations to promotional formats, in  South
Africa.   Operating profit decreased significantly in 1997  compared
with  1996,  primarily because of lower revenues, timing of  reduced
price mailings and continuing investments in new country expansion.

Corporate Expense
Corporate  expense in the first quarter of 1997 decreased  to  $10.7
compared with $11.7 in the first quarter of 1996 due to the  benefit
of cost containment initiatives.


Business Segments

Reader's Digest Magazine
Revenues for Reader's Digest Magazine decreased from $177.4  in 1996
to $174.9, or by 1%, in 1997.  This decrease was due to decreases in
circulation  revenues.  Lower circulation levels  and  to  a  lesser
extent  the  unfavorable  effect  of  changes  in  foreign  currency
exchange  rates were partially offset by higher average subscription
prices  in certain new and high inflation markets.  Operating profit
for  Reader's Digest Magazine decreased significantly in  the  first
quarter  of  1997  compared with the same period a  year  ago.   The
decrease  reflects lower revenues, investments in new countries,  as
well  as  increased  promotional  spending  to  retain  high-quality
subscribers who purchase the company's other products.

Books and Home Entertainment Products
Revenues  for  Books and Home Entertainment Products decreased  from
$515.5 in 1996 to $439.2, or by 15%, in 1997, of which approximately
11%  was  attributable  to the company's European  operations.  Most
product  lines  reported significantly lower revenues, predominantly
due  to  lower  unit  sales. Operating profit  for  Books  and  Home
Entertainment Products decreased significantly in 1997 compared with
1996.   These  results reflect lower unit sales in Europe  from  the
strategic  reduction  in  mail quantities, lower  customer  response
rates  to  modified  and  varied promotional formats  and  moderated
pricing;  as  well  as lower customer response  to  Condensed  Books
promotional mailings and execution problems in the United States, as
discussed above.

Special Interest Magazines
Revenues for Special Interest Magazines decreased from $20.0 in 1996
to  $15.7,  or  by  21%,  in  1997.   This  decrease  was  primarily
attributable to the sale of Travel Holiday in the third  quarter  of
1996.  Operating  performance improved in 1997  compared  with  1996
primarily reflecting the divestiture of Travel Holiday.

Forward-Looking Information
The  company  expects  that  in  the second  quarter  revenues  will
stabilize  and  operating  profit should  be  down  only  moderately
compared with prior year as European operations continue to recover.
The  company's strategic actions, discussed above, are  expected  to
provide  initial benefits in the form of improving customer response
rates,  declining product returns and bad debts and  rebuilding  and
augmenting  the  customer base, particularly in the second  half  of
1997,  with  improved financial results to follow.  The benefits  of
the  company's  actions,  including the cost savings from  the  1996
downsizing, should be an upward turn in the company's results in the
second half of this fiscal year.

Given the company's expectations of improved European performance in
the second half of 1997 and assuming planned results in the rest  of
the  business, the company expects solid full-year operating  profit
growth  in  1997;  however  the company also  expects  substantially
lower  interest  income, lower capital gains and  a  one  percentage
point  higher effective tax rate.  Due to these non-operating items,
earnings  per share  will not track with operating profit growth  in
1997.

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 grow its customer base and improve customer  response
rates,  especially  the  impact of modified and  varied  promotional
formats  on customer responses, the appeal of the company's  mix  of
products,  the  company's success at entering into and collaborating
with  others  to  conduct effective strategic  alliances  and  joint
ventures, and general economic conditions.


Liquidity and Capital Resources

September 30, 1996 Compared  With June 30, 1996

Cash  and  cash  equivalents, short-term investments and  marketable
securities  decreased $138.6 to $235.6 at September 30,  1996.   The
decrease  was  primarily  due to dividend  payments  of  $48.7,  the
repurchase  of Class A nonvoting common stock, at a cost  of  $27.7,
and cash used by operations of $66.3.

In  the  first quarter of 1997, the company paid a $0.45  per  share
dividend  on its common stock, representing a 13% increase, compared
with  $0.40 per share a year ago.  At the current rate, the  company
will  pay a total dividend of $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 0.7 million  shares
of Class A nonvoting common stock in the first quarter of 1997. From
the  announcement of its first repurchase program in  February  1992
through   September   30,   1996,  the   company   has   repurchased
approximately 15.7 million shares of Class A nonvoting common stock.

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

       No reports on Form 8-K were filed for the quarter for which
       this report is filed.



                              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:  November 7, 1996          By:  Stephen R. Wilson
                                      Stephen R. Wilson
                                      Executive Vice President and
                                      Chief Financial Officer
                                      (and authorized signatory)


                                   
                             EXHIBIT INDEX
                                   
                                                              
Exhibit                                                       
  27      Financial Data Schedule