Exhibit 10.1

                                XOMA CORPORATION

                                 First Amendment
                                       to
                 Convertible Preferred Stock Purchase Agreement
                              dated August 13, 1997

     This AMENDMENT, dated as of January 1, 1998 (the "Amendment"), to the
Convertible Preferred Stock Purchase Agreement dated August 13, 1997 (the
"Purchase Agreement"), among XOMA Corporation (the "Company") and the entities
who have signed this Amendment, as set forth below (collectively, the
"Purchasers").

                              W I T N E S S E T H :

     WHEREAS, the parties hereto are parties to the Purchase Agreement, pursuant
to which the Purchasers acquired shares of Series G Convertible Preferred Stock
of the Company; and

     WHEREAS, the Purchase Agreement provides for an additional closing for the
issue and sale by the Company to the Purchasers of an additional series of
convertible preferred stock of the Company; and

     WHEREAS, the parties desire to amend certain provisions of the Purchase
Agreement and to enter into certain other agreements with respect to the Series
G Shares, effective as of the date of this Amendment.

     NOW THEREFORE, the parties agree that the Purchase Agreement is amended as
follows:

     1. Defined Terms. Capitalized terms used in this Amendment, unless
otherwise defined herein, have the meanings set forth in the Purchase Agreement
or the Series G Designation, as applicable.

     2. Limitations on Conversions of Series G Shares. The Purchasers and the
Company agree that each Purchaser shall limit the number of Series G Shares that
it shall convert into Common Stock during any month from the date hereof through
February 28, 1998 as follows:

          (a) From the period from the date hereof through January 31, 1998,
     each Purchaser may convert into Common Stock a number of Series G Shares
     equal to one-third of the number of Series G Shares held by such Purchaser
     on the date hereof.


<PAGE>

          (b) From the period from February 1, 1998 through February 28, 1998,
     each Purchaser may convert into Common Stock a number of Series G Shares
     equal to (i) two-thirds of the number of Series G Shares held by such
     Purchaser on the date hereof, less (ii) the number of Series G Shares
     converted during the period January 1, 1998 through January 31, 1998.

          (c) On and after March 1, 1998, there shall be no limitations on the
     ability of any Purchaser to convert any Series G Shares other than any
     limitations set forth in the Purchase Agreement as in effect prior to the
     date hereof.

          (d) The number of Series G Shares held by a Purchaser as of the date
     hereof shall be determined assuming any Series G Shares as to which a
     conversion notice was sent to the Company prior to the date hereof had been
     converted into Common Stock and are no longer outstanding. The limitations
     set forth in the preceding subsections (a) and (b) shall be computed with
     reference to conversion notices given, and not with respect to Series G
     Shares actually converted of record, during such periods.

     3. Additional Share Issuance. As an inducement to the Purchasers to defer
conversion of the Series G Shares into Common Stock for an extended period of
time, the Company agrees that it shall issue additional shares of Common Stock
to the Purchasers on the following terms:

          (a) Any Purchaser who converts any Series G Shares more than 210 days
     after the Original Issue Date shall, upon such conversion, be issued a
     number of shares of Common Stock, in addition to the number of shares
     required to be issued on conversion in accordance with the Series G
     Designation, equal to (i) the number of shares of Common Stock that would
     have been issued to such Purchaser if the Applicable Percentage had been
     86%, less (ii) the number of shares of Common Stock otherwise issuable
     under the terms of the Series G Designation. In lieu of issuing the Common
     Stock on any such conversion, the Company shall have the right to pay cash
     to such Purchaser in an amount equal to the Per Share Market Value as at
     the date of conversion multiplied by the number of shares of Common Stock
     that would otherwise be issuable pursuant to this Section 3(a).

          (b) All shares of Common Stock issued to any Purchaser pursuant to the
     foregoing Section 3(a) shall be duly authorized, fully paid and
     nonassessable.

          (c) The Company shall take such steps as may be required to include
     any shares of Common Stock issued or issuable under Section 3(a) to be
     included in the Underlying Shares Registration Statement that has been
     filed and is effective with respect to the Common Stock issuable on
     conversion of the Series G Shares.


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<PAGE>

     4. Series H Closing. Notwithstanding the terms of the Purchase Agreement,
in the event the Company has not previously given the Subsequent Financing
Notice, a Majority in Interest of the Purchasers shall have the right to require
the Series H Closing to take place at any time after April 30, 1998 through
September 30, 1998. Such right may be exercised by a Majority in Interest of the
Purchasers by delivering a notice (a "'Required Financing Notice") to the
Company, and to the other Purchasers, in accordance with the notice provisions
of the Purchase Agreement. The Required Financing Notice shall be executed on
behalf of a Majority in Interest of the Purchasers and shall set forth the date
and time of the Series H Closing, which shall be not less than 15 Trading Days
after the date on which the Required Financing Notice is given. The Company
shall use its commercially reasonable best efforts to cause the Series H Closing
to take place, and to cause all conditions for the Series H Closing to have been
met, at the time and date set forth in the Required Financing Notice or as
promptly thereafter as possible. If the Company has the right to deliver, and
delivers, the Subsequent Financing Notice after the giving of a Required
Financing Notice, the Subsequent Financing Notice shall supersede the Required
Financing Notice. For purposes of this Amendment, a "Majority in Interest" of
the Purchasers at any time shall mean Purchasers who acquired a majority of the
Series G Shares issued at the Series G Closing.

     5. Except as specifically amended or supplemented hereby, (i) the Purchase
Agreement shall not be amended and no provisions thereof shall be waived by any
party, and (ii) the Purchase Agreement is hereby ratified and confirmed in all
respects. The parties confirm that the provisions of paragraphs 2 and 3 of this
Amendment shall apply only to the Series G Shares, and not to the Series H
Shares.

     6. This Amendment may be executed in two or more counterparts, each of
which shall be deemed an original and all of which taken together shall
constitute a single instrument.




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<PAGE>


     IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the
date first written above.


XOMA CORPORATION                          SOUTHBROOK INTERNATIONAL
                                          INVESTMENTS LTD.


By:                                       By:
   -------------------------------           --------------------------------

HBK CAYMAN L.P.                           HBK OFFSHORE FUND, LTD.


By:                                       By:
   -------------------------------           --------------------------------


HBK INVESTMENTS LTD.                      PROPRIETARY CONVERTIBLE
                                          INVESTMENT GROUP, INC.


By:                                       By:
   -------------------------------           --------------------------------


PINE STREET ASSET                         BROWN SIMPSON STRATEGIC
MANAGEMENT L.P.                           GROWTH FUND, L.P.


By:                                       By:
   -------------------------------           --------------------------------



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