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 December 31, 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.
        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  January  31, 1997, the following shares of the  registrant's
common stock were outstanding:

Class A Nonvoting Common Stock, $0.01 par value:  84,480,493 shares
Class B Voting Common Stock, $0.01 par value:21,716,057 shares




                                                 Page 1 of 17 pages.
                                                                    
                                   
        THE READER'S DIGEST ASSOCIATION, INC. AND SUBSIDIARIES
                                   
                          Index to Form 10-Q
                                   
                           December 31, 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 and six-month periods ended December 31, 1996 
 and 1995                                                       3

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

 Consolidated Condensed Statements of Cash Flows
  for the six-month periods ended December 31, 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                                    13

<TABLE>
                                   
        THE READER'S DIGEST ASSOCIATION, INC. AND SUBSIDIARIES
              CONSOLIDATED CONDENSED STATEMENTS OF INCOME
     Three and six-month periods ended December 31, 1996 and 1995
                 (In millions, except per share data)
                              (unaudited)


                          Three-month period ended     Six-month period ended
                                 December 31,                December 31,
                             1996           1995         1996           1995
<C>                        <S>           <S>         <S>            <S>
Revenues                   $  874.6      $  918.6    $  1,518.6     $ 1,649.1

Product,distribution          297.4         312.4         519.1         563.3
 and editorial expense
Promotion, marketing          444.6         461.8         820.3         859.6
  and administrative
  expense
                                                           
Operating profit              132.6         144.4         179.2         226.2

Other income                   (0.3)          4.8           7.7           7.9
(expense), net

Income before                                              
 provision for                132.3         149.2         186.9         234.1
 income taxes

Provision for income           48.2          54.4          68.2          85.4
  taxes

Net income                 $   84.1     $    94.8      $  118.7     $   148.7

Earnings per share         $   0.78     $    0.88      $   1.10     $    1.37

Average common                                             
  shares outstanding          106.6         107.9         107.0        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 December 31, 1996 and June 30, 1996
                             (In millions)
                              (unaudited)


                                           December 31,       June 30,
                                              1996              1996
<C>                                       <S>               <S>
Assets                                                  
Cash and cash equivalents                 $   113.5         $   258.1
Short-term investments                         14.2              18.9
Receivables, net                              643.1             412.4
Inventories                                   213.3             204.4
Prepaid expenses and other current assets     277.6             310.3

Total current assets                        1,261.7           1,204.1

Marketable securities                          79.0              97.2
Property, plant and equipment, net            257.1             261.5
Other noncurrent assets                       367.1             341.3

Total assets                             $  1,964.9        $  1,904.1

Liabilities and stockholders' equity                    
Accounts payable                        $     240.3        $    216.0
Accrued expenses                              442.0             457.3
Income taxes payable                           70.9              67.3
Unearned revenue                              405.8             354.9
Other current liabilities                      23.1              17.5

Total current liabilities                   1,182.1           1,113.0

Other noncurrent liabilities                  332.6             312.2

Total liabilities                           1,514.7           1,425.2

Capital stock                                  28.9              28.4
Paid-in capital                               140.8             138.3
Retained earnings                           1,005.5             984.0
Foreign currency translation adjustment       (10.2)            (14.2)
Net unrealized losses on certain                        
 investments                                   (0.7)             (1.3)
Treasury stock, at cost                      (714.1)           (656.3)

Total stockholders' equity                    450.2             478.9

Total liabilities and stockholders'     $   1,964.9        $  1,904.1
  equity


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

<TABLE>
                                   
        THE READER'S DIGEST ASSOCIATION, INC. AND SUBSIDIARIES
            CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
          Six-month periods ended December 31, 1996 and 1995
                             (In millions)
                              (unaudited)


                                                Six-month period
                                                     ended
                                                  December 31,
                                                1996        1995
<C>                                          <S>         <S>
Cash flows from operating activities                     
Net income                                   $  118.7    $ 148.7
Depreciation and amortization                    23.1       23.7
Other, net                                     (171.6)    (193.9)

Net change in cash due to operating             (29.8)     (21.5) 
  activities

Cash flows from investing activities                     
Proceeds from maturities and sales of                    
   short-term investments and marketable         48.8      272.7
   securities
Purchases of short-term investments and         (21.2)    (136.8)
   marketable securities
Other, net                                      (15.4)     (40.5)

Net change in cash due to investing              12.2       95.4
  activities

Cash flows from financing activities                     
Dividends paid                                  (97.2)     (92.4)
Common stock repurchased                        (61.5)     (42.3)
Other, net                                       33.4        2.7

Net change in cash due to financing            (125.3)    (132.0)
  activities

Effect of exchange rate changes on cash          (1.7)      (0.5)

Net change in cash and cash equivalents        (144.6)     (58.6)

Cash and cash equivalents at beginning of       258.1      214.6
  period
Cash and cash equivalents at end of period   $  113.5    $ 156.0

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 December 31, 1996 and 1995 are the second 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 December 31, 1996 and 1995 and $0.7 in each  of
the  six-month  periods ended December 31,  1996  and  1995  by  the
weighted  average  number of common shares  outstanding  during  the
period.

(3)  Inventories
                                         December 31,    June 30,
                                             1996          1996
                                                      
Raw materials                            $   20.7         $  33.0
Work-in progress                             26.1            19.9
Finished goods                              166.5           151.5
                                         $  213.3         $ 204.4


<TABLE>

(4)  Revenues by Business Segments and Geographic Areas

                             Three-month period      Six-month period
                                   ended                  ended
                                December 31,           December 31,
                              1996        1995       1996        1995
<C>                          <S>        <S>         <S>         <S>
BUSINESS SEGMENTS                                             
Reader's Digest Magazine     $ 187.6    $ 190.3     $  362.5    $  367.7
Books and Home                 549.0      592.9        988.2     1,108.4
 Entertainment Products
Special Interest Magazines      22.0       25.8         37.7        45.8
Other Businesses               116.0      109.6        130.2       127.2

Total revenues               $ 874.6    $ 918.6     $1,518.6    $1,649.1
                                                              
GEOGRAPHIC AREAS                                              
United States                $ 396.3    $ 402.3     $  665.8    $  692.0
Europe                         354.0      390.9        629.6       728.6
Pacific and Other Markets      124.3      125.4        223.2       228.5

Total revenues               $ 874.6    $ 918.6     $1,518.6    $1,649.1
                                                              
</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 December 31,
1996, were:

             
                                 Total               
                                Charged    Utilized    Remaining

Employee retirement &           $ 104.4    $   62.4    $    42.0
  severance benefits
Other items                        51.5        20.1         31.4
Business repositioning             48.1        21.2         26.9

Total                           $ 204.0    $  103.7    $   100.3

(6)  Debt

The company has 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 December 31, 1996, there were no borrowings
outstanding under the credit agreement.


        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 December 31, 1996 Compared With Three-Month
Period Ended December 31, 1995

Worldwide  revenues  for the second quarter  of  1997  decreased  to
$874.6,  or  by  5%, compared with $918.6 in the second  quarter  of
1996.   Excluding the adverse effect of changes in foreign  currency
exchange  rates,  revenues decreased 4%.  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 the Books and Home Entertainment Products segment. Worldwide
operating  profit  decreased to $132.6, or  by  8%,  in  the  second
quarter of 1997, compared with $144.4 in the second quarter of 1996.
These  results reflect the adverse impact of reduced mail quantities
in  the  company's  European operations and the ongoing  actions  to
restore  long-term growth in this region, partially  offset  by  the
benefits of stringent cost-containment initiatives worldwide.  Lower
response   rates  and  revenues  in  the  short-term  reflect   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.

The  company reported net income of $84.1, or $0.78 per share in the
second  quarter of 1997, compared with $94.8, or $0.88 per share  in
the second quarter of 1996.

Other Income (Expense), Net
Other income (expense), net decreased in the second quarter of  1997
to  $(0.3),  compared  with  $4.8 a year  ago.   This  decrease  was
primarily because of lower interest income and lower gains on  sales
of certain investments.

Income Taxes
The overall effective tax rate is 36.5% for both the second quarters
of  1997  and  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 $402.3  in  1996  to
$396.3, or by 1%, in 1997.  This decrease was primarily attributable
to the sale of Travel Holiday magazine in the third quarter of 1996.
Also, lower unit sales in Books and Home Entertainment Products were
partially  offset by a revenue increase in Other Businesses  due  to
higher  sales at QSP.  Within Books and Home Entertainment Products,
revenues benefited largely from increased sales in the video product
line, which were more than offset by declines in music products  and
general  books.   Video  revenues benefited  primarily  from  higher
catalog sales.  Contributing to the decline in unit sales for  music
products  was  a  lower  customer response to promotional  mailings.
General  books  revenues declined principally due to a  lower-priced
product mix.  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 $390.9 in 1996 to $354.0,  or  by
9%,  in  1997.  Excluding the adverse effect of changes  in  foreign
currency  exchange  rates,  revenues  decreased  6%.   The   revenue
decrease  was  primarily due to lower unit sales and,  to  a  lesser
extent,  lower-priced product offerings and sales of a  lower-priced
product  mix of Books and Home Entertainment Products.  Within  this
segment  revenues  declined in all product lines.  Operating  profit
decreased  significantly  in  1997  compared  with  1996,  but  less
significantly than in the first quarter of 1997 compared with  1996.
Second  quarter results reflect 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 reduction of  the
number of promotional mailings and mail quantity in a given mailing,
variation  of promotional formats, moderation of product prices  and
investments in new selling channels.

Pacific and Other Markets
Revenues in Pacific and Other Markets decreased from $125.4 in  1996
to  $124.3,  or  by 1%, in 1997.  Lower Books and Home Entertainment
Products  revenues were offset by increased Reader's Digest magazine
circulation  revenues in new countries.   Within  Books  and  Home
Entertainment Products, the decline in revenues was largely  due  to
lower-priced  product offerings and sales of a lower-priced  product
mix,  partially offset by higher unit sales.  Improved  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.  Operating profit decreased in 1997 compared with  1996,
primarily because of lower revenues, lower activity levels in  South
Africa,  reduced-price mailings and continuing  investments  in  new
country  expansion,  partially  offset  by  the  benefit  of   cost-
containment initiatives.

Corporate Expense
Corporate expense in 1997 decreased to $13.7, compared with $17.2 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 $190.3 in  1996
to  $187.6,  or by 1%, in 1997.  This decrease was due primarily  to
decreases   in  circulation  revenues,  and  to  a  lesser   extent,
advertising revenues. The decrease in circulation revenues  reflects
lower-priced  subscription offers in several  countries,  which  are
consistent   with  the  company's  long-term  growth   strategy   to
strengthen and expand its global customer base, offset by  increased
circulation  levels  in  new countries.  Lower  advertising  revenue
primarily reflects a lower number of advertising pages in the United
States  and Europe, partially offset by higher pages in Pacific  and
Other  Markets.  Lower European advertising revenues were  partially
due  to  circulation declines in certain markets and the decline  of
print  advertising's  share  of  the  overall  European  advertising
market.   Operating  profit for Reader's Digest  Magazine  decreased
significantly in the second quarter of 1997 compared with  the  same
period  a  year  ago.   The  decrease reflects  lower  revenues  and
increased  promotional  spending, as  well  as  investments  in  new
countries.

Books and Home Entertainment Products
Revenues  for  Books and Home Entertainment Products decreased  from
$592.9 in 1996 to $549.0, or by 7%, in 1997 principally attributable
to  the  company's European operations. Most 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.   Operating  profit  for  Books   and   Home
Entertainment Products decreased in 1997 compared with 1996.   These
results  primarily  reflect  reduced  volume  in  Europe  from   the
reduction  of  promotional mail quantities, lower customer  response
rates to varied promotional formats and moderated pricing.

Special Interest Magazines
Revenues for Special Interest Magazines decreased from $25.8 in 1996
to  $22.0,  or  by  15%,  in  1997.   This  decrease  was  primarily
attributable to the sale of Travel Holiday in the third  quarter  of
1996.   Excluding prior year revenues from Travel Holiday,  revenues
increased  9%  due  almost  equally  to  increased  advertising  and
circulation revenues.  The increase in advertising revenues reflects
increased  advertising  pages, while  the  increase  in  circulation
revenues  reflects higher circulation levels.  Operating performance
improved  in  1997  compared with 1996 primarily  reflecting  higher
advertising revenues.

Six-Month  Period  Ended December 31, 1996 Compared  With  Six-Month
Period Ended December 31, 1995

Worldwide revenues for the six-month period ended December 31,  1996
decreased to $1,518.6, or by 8%, compared with $1,649.1 in the  six-
month  period ended December 31, 1995.  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
the  Books  and  Home  Entertainment  Products  segment.   Worldwide
operating  profit decreased to $179.2, or by 21%, in the  first  six
months  of  1997, compared with $226.2 in the first  six  months  of
1996.   These  results reflect the adverse impact  of  reduced  mail
quantities  in  the company's European operations  and  the  ongoing
actions to restore long-term growth in this region, partially offset
by the benefits of stringent cost-containment initiatives worldwide.
Lower  response  rates and revenues in the short-term  reflect  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  adversely
affecting  operating  profit in the first six  months  of  1997  was
investment  spending on initiatives to increase customer counts,  as
well as investments in new selling channels.

The company reported net income of $118.7, or $1.10 per share in the
first  six months of 1997, compared with $148.7, or $1.37 per  share
in the first six months of 1996.

Other Income (Expense), Net
Other  income (expense), net for the six-month period ended December
31,  1996  decreased to $7.7 compared with $7.9 a  year  ago.   This
decrease  was primarily because of lower interest income and  higher
interest  expense, partially offset by higher gains on the sales  of
certain investments.

Income Taxes
The  overall  effective  tax rate is 36.5% for  both  the  six-month
periods  ended  December 31, 1996 and 1995. 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 $692.0  in  1996  to
$665.8,  or  by 4%, in 1997.  Approximately 3% 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 primarily
attributable to declines in music products and Condensed Books.  The
decline in music products primarily reflects lower customer response
to  promotional mailings.  The decline in Condensed Books was caused
by   lower  customer  response  to  promotional  offers  and   lower
membership retention rates.  The company believes that the  lack  of
variety   in  promotion  techniques  contributed  to  this  decline.
Operating profit decreased in 1997 compared with 1996 due  to  lower
revenues,  timing  of  expenses  and  increased  investment  in  new
initiatives,  partially  offset by the benefit  of  cost-containment
initiatives.

Europe
Revenues  in Europe decreased from $728.6 in 1996 to $629.6,  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 of 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 reduction of the number of promotional mailings
and  mail  quantity  in  a given mailing, variation  of  promotional
formats, moderation of product prices and investments in new selling
channels.

Pacific and Other Markets
Revenues in Pacific and Other Markets decreased from $228.5 in  1996
to  $223.2,  or by 2%, 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 largely  due  to
lower-priced  product offerings and sales of a lower-priced  product
mix.    Improved  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.   Operating
profit decreased significantly in 1997 compared with 1996, primarily
because  of  lower revenues, lower activity levels in South  Africa,
reduced-price  mailings and continuing investments  in  new  country
expansion,  which  were partially offset by  the  benefit  of  cost-
containment initiatives.



Corporate Expense
Corporate expense in 1997 decreased to $24.4 compared with $28.9  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 $367.7 in  1996
to  $362.5,  or  by  1%, in 1997.  Excluding the adverse  effect  of
changes in foreign currency exchange rates, revenues were about even
year-over-year.  The decrease in revenues was  due  to  declines  in
circulation  revenues, partially offset by increases in  advertising
revenues.  The decline in circulation revenues reflects lower-priced
subscription offers in several countries, which are consistent  with
the company's long-term growth strategy to strengthen and expand its
global  customer  base,  partially offset by  increased  circulation
levels  in  new  countries.  Within advertising  revenues,  a  lower
number of advertising pages was more than offset by higher rates per
page.   Operating  profit  for Reader's  Digest  Magazine  decreased
significantly in the first six months of 1997 compared with the same
period  a  year  ago.   The  decrease reflects  lower  revenues  and
investments in new countries.

Books and Home Entertainment Products
Revenues  for  Books and Home Entertainment Products decreased  from
$1,108.4  in  1996  to  $988.2,  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.  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  reduction of promotional mail  quantities,  lower
customer  response rates to varied promotional formats and moderated
pricing,  as  well  as lower customer response  to  Condensed  Books
promotional mailings and lower membership retention rates.

Special Interest Magazines
Revenues for Special Interest Magazines decreased from $45.8 in 1996
to  $37.7,  or  by  18%,  in  1997.   This  decrease  was  primarily
attributable to the sale of Travel Holiday in the third  quarter  of
1996.  Excluding  prior year revenues from Travel Holiday,  revenues
increased  3%  due  primarily  to  increased  advertising  revenues.
Operating  performance improved in 1997 compared with 1996 primarily
reflecting the divestiture of Travel Holiday.

Forward-Looking Information

The  comparison  of  1997 to 1996 second quarter results  showed  an
improvement  over  the 1997 first quarter compared  with  the  prior
year.   The company anticipates that results for the second half  of
1997  will  continue  to  show an improving trend  in  quarter-over-
quarter  comparisons to the same periods in the prior year,  meeting
current market expectations for 1997 earnings per share.

While  the company expects growth in customers and revenues  in  the
latter part of 1997 compared to the prior year, this performance may
not generate momentum into 1998, to the extent previously expected.

The  company  expects modest 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, excluding other operating items.  Due  to  these
non-operating  items,  earnings  per  share  will  not  track   with
operating profit growth in 1997.

The  company  is  assessing  the combined  impact  of  the  tactical
implementation  of  many simultaneous strategic  initiatives,  which
vary  country  by  country.  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
will  continue  to  refine its strategy as necessary.   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  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, as  well  as  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

Cash  and  cash  equivalents, short-term investments and  marketable
securities decreased $167.5 to $206.7 at December 31, 1996  compared
with  June  30,  1996.  The decrease was primarily due  to  dividend
payments of $97.2, the repurchase of Class A nonvoting common stock,
at  a  cost  of  $61.5,  and  cash  used  by  operations  of  $29.8.
Consistent  with  the  prior year, the  company  used  cash  in  its
operations in the first six months of 1997 due to the seasonality of
its revenues and expenses.

In  both  the  second 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  1.6
million  shares of Class A nonvoting common stock in the  first  six
months  of  1997.  From  the announcement of  its  first  repurchase
program in February 1992 through December 31, 1996, the company  has
repurchased  approximately 16.6 million shares of Class A  nonvoting
common stock.

The  company  has 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 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

At  the  1996 Annual Meeting of Stockholders of the Company,  held  on
November  8,  1996,  the  following  matters  were  voted  on  by  the
stockholders:

Proposal  1:   Election  of  Directors  to  hold
office  until  the next Annual Meeting or until their  successors  are
duly  elected  and qualified.  Each nominee was elected by  the  votes
cast as follows:

                                For        Withheld
     James P. Schadt         20,507,305        156,147
     Melvin R. Laird         20,552,058        111,394
     William G. Bowen        20,555,408        108,044
     Lynne V. Cheney         20,544,665        118,787
     M. Christine DeVita     20,538,633        124,819
     James E. Preston        20,554,808        108,644
     Robert G. Schwartz      20,553,198        110,254
     Walter V. Shipley       20,555,468        107,984
     C.J. Silas              20,555,468        107,984
     William J. White        20,555,468        107,984


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

(a)  Exhibits

   10.23   US$400,000,000  Competitive  Advance   and   Revolving
           Credit  Facility  Agreement dated as of November  12,  1996
           between the Company, the Borrowing Subsidiaries, The  Chase
           Manhattan Bank and J.P. Morgan Securities Inc.

   10.24   Termination  Agreement  dated  as  of  April  1,  1996
           between the registrant and Martin J. Pearson *

   27      Financial Data Schedule.  [1 page]

(b)  Reports on Form 8-K

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



* Denotes a management contract or compensatory plan.




                              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:  February 12, 1997         By:    STEPHEN R. WILSON
                                        Stephen R. Wilson
                                        Executive Vice President and
                                        Chief Financial Officer
                                        (and authorized signatory)

                                   
                                   
                             EXHIBIT INDEX
                                   
                                   
                                                              
     Exhibit                                                      Page
     10.23     US$400,000,000 Competitive Advance and            
               Revolving Credit Facility Agreement dated as of   
               November 12, 1996 between the Company, the
               Borrowing Subsidiaries, The Chase Manhattan
               Bank and J.P. Morgan Securities Inc.
               
     10.24     Termination Agreement dated as of April 1, 1996   
               between the registrant and Martin J. Pearson.     
               
     27        Financial Data Schedule.