UNITED STATES
               SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C.  20549

                            FORM 10-Q



[x]Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the Quarterly Period Ended March 31, 2006.


[  ]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 1-2691.



                    American Airlines, Inc.
     (Exact name of registrant as specified in its charter)

        Delaware                            13-1502798
    (State or other                      (I.R.S. Employer
      jurisdiction                      Identification No.)
   of incorporation or
     organization)

 4333 Amon Carter Blvd.
   Fort Worth, Texas                           76155
 (Address of principal                      (Zip Code)
   executive offices)

Registrant's telephone number,           (817) 963-1234
including area code



                         Not Applicable
(Former name, former address and former fiscal year , if changed
                       since last report)


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.   x  Yes     No


Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, or a non-accelerated
filer.  See definition of "accelerated filer" and "large
accelerated filer" in Rule 12b-2 of the Exchange Act. Large
Accelerated Filer      Accelerated Filer   x   Non-accelerated Filer


Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable date.


Common Stock, $1 par value - 1,000 shares as of April 14, 2006.

The registrant meets the conditions set forth in, and is filing
this form with the reduced disclosure format prescribed by,
General Instructions H(1)(a) and (b) of Form 10-Q.






                                 INDEX

                        AMERICAN AIRLINES, INC.




PART I:   FINANCIAL INFORMATION


Item 1.  Financial Statements

  Consolidated Statements of Operations -- Three months ended March 31,
  2006 and 2005

  Condensed  Consolidated  Balance  Sheets  --  March  31,  2006  and
  December 31, 2005

  Condensed  Consolidated Statements of Cash Flows  --  Three  months
  ended March 31, 2006 and 2005

  Notes  to Condensed Consolidated Financial Statements -- March  31,
  2006

Item  2.  Management's Discussion and Analysis of Financial Condition
and Results of Operations

Item 3.  Quantitative and Qualitative Disclosures about Market Risk

Item 4.  Controls and Procedures


PART II:  OTHER INFORMATION

Item 1.  Legal Proceedings

Item 5.  Other Information

Item 6.  Exhibits


SIGNATURE









                    PART I:  FINANCIAL INFORMATION

Item 1.  Financial Statements

AMERICAN AIRLINES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited) (In millions)

                                               Three Months Ended March 31,
                                                  2006          2005
Revenues
  Passenger                                 $    4,244     $   3,841
  Regional Affiliates                              569           451
  Cargo                                            186           183
  Other revenues                                   328           262
    Total operating revenues                     5,327         4,737


Expenses
  Wages, salaries and benefits                   1,576         1,502
  Aircraft fuel                                  1,332           996
  Regional payments to AMR Eagle                   532           473
  Other rentals and landing fees                   286           273
  Commissions, booking fees and
    credit card expense                            269           271
  Depreciation and amortization                    240           245
  Maintenance, materials and repairs               187           192
  Aircraft rentals                                 141           143
  Food service                                     123           123
  Other operating expenses                         589           563
    Total operating expenses                     5,275         4,781


Operating Income (Loss)                             52           (44)

Other Income (Expense)
  Interest income                                   52            35
  Interest expense                                (213)         (175)
  Interest capitalized                               7            22
  Related party interest - net                       6            (2)
  Miscellaneous - net                              (10)           (7)
                                                  (158)         (127)


Loss Before Income Taxes                          (106)         (171)
Income tax                                          -             -
Net Loss                                    $     (106)    $    (171)








The accompanying notes are an integral part of these financial statements.

                                      -1-


AMERICAN AIRLINES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) (In millions)

                                              March 31,     December 31,
                                                 2006          2005
Assets
Current Assets
  Cash                                      $     144     $     133
  Short-term investments                        4,077         3,637
  Restricted cash and short-term
    investments                                   510           510
  Receivables, net                              1,051           967
  Inventories, net                                449           474
  Other current assets                            459           321
    Total current assets                        6,690         6,042

Equipment and Property
  Flight equipment, net                        11,680        11,696
  Other equipment and property, net             2,333         2,352
  Purchase deposits for flight equipment          227           277
                                               14,240        14,325

Equipment and  Property Under Capital Leases
  Flight equipment, net                           856           916
  Other equipment and property, net               109           102
                                                  965         1,018

Route acquisition costs an  airport
  operating and gate lease rights, net          1,162         1,167
Other assets                                    3,451         3,489
                                            $  26,508     $  26,041

Liabilities and Stockholder's Equity (Deficit)
Current Liabilities
  Accounts payable                          $   1,074     $     998
  Accrued liabilities                           2,052         2,205
  Air traffic liability                         4,189         3,615
  Payable to affiliates, net                      500           544
  Current maturities of long-term debt            818           829
  Current obligations under capital leases        118           138
    Total current liabilities                   8,751         8,329

Long-term debt, less current maturities         8,685         8,785
Obligations  under  capital  leases,  less
current obligations                               872           922
Pension and postretirement benefits             5,126         4,998
Other  liabilities, deferred  gains and
deferred credits                                4,141         4,186

Stockholder's Deficit
  Common stock                                     -             -
  Additional paid-in capital                    3,604         3,406
  Accumulated other comprehensive loss         (1,067)       (1,087)
  Accumulated deficit                          (3,604)       (3,498)
                                               (1,067)       (1,179)
                                            $  26,508     $  26,041


The  accompanying  notes  are an integral  part  of  these  financial
statements.


                                      -2-

AMERICAN AIRLINES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) (In millions)

                                                Three Months Ended March 31,
                                                    2006           2005

Net Cash Provided by Operating Activities       $    732       $    413

Cash Flow from Investing Activities:
  Capital expenditures                              (101)          (106)
  Net increase in short-term investments            (440)           (96)
  Net (increase) decrease in restricted cash
    and short-term investments                         -             (5)
  Proceeds from sale of equipment and
    property                                           1              2
  Other                                                -              2
    Net cash used by investing activities           (540)          (203)


Cash Flow from Financing Activities:
  Payments on long-term debt and capital
    lease obligations                               (184)          (143)
  Reimbursement from construction reserve
    account                                           48              -
  Funds transferred to affiliates, net               (45)           (37)
    Net cash used by financing activities           (181)          (180)


Net increase in cash                                  11             30
Cash at beginning of period                          133            117

Cash at end of period                           $    144       $    147
























The  accompanying notes are an integral part of these  financial
statements.

                                      -3-

AMERICAN AIRLINES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

1.  The   accompanying   unaudited  condensed   consolidated   financial
    statements have been prepared in accordance with generally  accepted
    accounting  principles for interim financial  information  and  with
    the  instructions  to Form 10-Q and Article 10  of  Regulation  S-X.
    Accordingly,  they  do  not  include  all  of  the  information  and
    footnotes  required by generally accepted accounting principles  for
    complete  financial statements. In the opinion of management,  these
    financial  statements contain all adjustments, consisting of  normal
    recurring  accruals,  necessary  to  present  fairly  the  financial
    position,  results  of  operations and cash flows  for  the  periods
    indicated.  Results of operations for the periods  presented  herein
    are  not  necessarily indicative of results of  operations  for  the
    entire year. American Airlines, Inc. (American or the Company) is  a
    wholly  owned  subsidiary of AMR Corporation  (AMR).  The  condensed
    consolidated  financial  statements also  include  the  accounts  of
    variable  interest  entities for which the Company  is  the  primary
    beneficiary.  For  further information, refer  to  the  consolidated
    financial statements and footnotes thereto included in the  American
    Airlines,  Inc.  Annual  Report on Form  10-K  for  the  year  ended
    December 31, 2005 (2005 Form 10-K).

    Cargo  fuel and security surcharge revenues of $32 million  for  the
    three  months ended March 31, 2005 have been reclassified from Other
    revenues  to  Cargo  revenues  in  the  consolidated  statement   of
    operations to conform to the current year presentation.

2.  Under  the  1998  Long  Term Incentive Plan, as  amended  (the  1998
    LTIP),  officers  and key employees of AMR and its subsidiaries  may
    be   granted  stock  options,  stock  appreciation  rights   (SARs),
    restricted  stock,  deferred  stock, stock  purchase  rights,  other
    stock-based  awards  and/or  performance-related  awards,  including
    cash  bonuses.   The  total number of common shares  authorized  for
    distribution  under the 1998 Long Term Incentive Plan is  23,700,000
    shares (after giving effect to a one-for-one stock dividend in  1998
    and  the  dividend of shares of The Sabre Group, Inc. via a spin-off
    in  2000).   The  1998  LTIP, the successor to the  1988  Long  Term
    Incentive  Plan (1988 LTIP), will terminate no later  than  May  21,
    2008.

    In  2003,  AMR  established the 2003 Employee Stock  Incentive  Plan
    (the  2003  Plan) to provide, among other things, equity  awards  to
    employees  as  part  of the 2003 restructuring process.   Under  the
    2003  Plan, employees may be granted stock options, restricted stock
    and  deferred  stock.  The  total number of  shares  authorized  for
    distribution under the 2003 Plan is 42,680,000 shares.

    Options  granted under the 1988 LTIP, 1998 LTIP and  the  2003  Plan
    are  awarded  with an exercise price equal to the fair market  value
    of  the  stock on date of grant, become exercisable in equal  annual
    installments  over  periods  ranging  from  three  to   five   years
    following the date of grant and expire no later than ten years  from
    the  date  of  grant.   As  of  March 31, 2006,  approximately  16.2
    million  options outstanding under the 1998 LTIP and the  2003  Plan
    had not vested.

    Prior  to  January 1, 2006, American accounted for its participation
    in   AMR's   stock-based  compensation  plans  in  accordance   with
    Accounting  Principles Board Opinion No. 25, "Accounting  for  Stock
    Issued  to  Employees" (APB 25) and related Interpretations.   Under
    APB  25,  no  compensation expense was recognized for  stock  option
    grants if the exercise price of AMR's stock option grants was at  or
    above  the fair market value of the underlying stock on the date  of
    grant.   Effective  January 1, 2006, AMR and  American  adopted  the
    fair   value  recognition  provisions  of  Statement  of   Financial
    Accounting   Standards  No.  123(R),  "Share-Based  Payment"   (SFAS
    123(R))  using  the modified-prospective transition  method.   Under
    this  transition method, compensation cost recognized in  the  first
    quarter  of 2006 includes: (a) compensation cost for all share-based
    payments  granted  prior to, but not yet vested  as  of  January  1,
    2006,  based  on  the  grant-date fair  value  used  for  pro  forma
    disclosures  and (b) compensation cost for all share-based  payments
    granted subsequent to January 1, 2006, based on the grant-date  fair
    value  estimated in accordance with the provisions of  SFAS  123(R).
    Results for prior periods have not been restated.

                                    -4-


AMERICAN AIRLINES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)

    As  a  result of adopting SFAS 123(R), American's net loss  for  the
    three  months ended March 31, 2006, was $11 million higher  than  if
    it  had continued to account for share-based compensation under  APB
    25.

    Prior  to  January  1, 2006, AMR and American had  adopted  the  pro
    forma  disclosure  features  of Statement  of  Financial  Accounting
    Standards  No. 123, "Accounting for Stock-Based Compensation"  (SFAS
    123), as amended by Statement of Financial Accounting Standards  No.
    148,   "Accounting   for  Stock-Based  Compensation-Transition   and
    Disclosure."   The  following table illustrates the  effect  on  net
    loss  and loss per share amounts if the Company had applied the fair
    value  recognition  provisions of SFAS 123 to  stock-based  employee
    compensation  (in  millions) for the three months  ended  March  31,
    2005:


    Net loss, as reported                               $(171)
    Add:  Stock-based employee compensation
      expense included in reported net loss                 6
    Deduct:  Total stock-based employee
      compensation expense determined
      under fair value based methods for
      all awards                                          (21)
    Pro forma net loss                                  $(186)


    On  March  29, 2006, the AMR Board of Directors amended and restated
    the   2003-2005  Performance  Share  Plan  for  Officers   and   Key
    Employees,  the  2004-2006 Performance Share Plan for  Officers  and
    Key   Employees,  and  the  2004  Agreements  for  Deferred   Shares
    (collectively,  the  Amended Plans).  Before  amendment,  the  plans
    allowed  for  settlement  only in cash.   The  three  Amended  Plans
    permit  settlement in a combination of cash and/or  stock;  however,
    the  amendments  did  not impact the fair value of  the  obligations
    under  the three Amended Plans.  AMR anticipates using all currently
    available  shares under the 1998 LTIP and the 2003 Plan  to  satisfy
    obligations  under the three Amended Plans, but,  based  on  current
    estimates,  a  portion of the obligations will be settled  in  cash.
    AMR  and  American will account for these obligations  prospectively
    as  a  combination  of liability and equity grants.   In  accordance
    with  SFAS  123(R),  the  Company  reclassified  $187  million  from
    Accrued  liabilities  to Additional paid-in  capital  on  March  29,
    2006,  representing  the vested portions of  the  current  estimated
    fair  value of obligations under all three of the Amended Plans that
    are expected to be settled with stock.

3.  As  of  March  31, 2006, the Company had commitments to acquire  one
    Boeing  777-200ER in the remainder of 2006 and an  aggregate  of  47
    Boeing  737-800s and seven Boeing 777-200ERs in 2013  through  2016.
    Future  payments  for all aircraft, including the estimated  amounts
    for  price escalation, will approximate $51 million in 2006  and  an
    aggregate  of approximately $2.8 billion in 2011 through  2016.  The
    Company  has  the ability to access pre-arranged backstop  financing
    for the Boeing 777-200ER scheduled to be delivered in 2006.

4.  Accumulated  depreciation of owned equipment and property  at  March
    31,  2006  and December 31, 2005 was $9.5 billion and $9.4  billion,
    respectively.   Accumulated amortization of equipment  and  property
    under  capital leases was $1.1 billion at both March 31, 2006 and
    December  31,  2005.

5.  As  discussed in Note 8 to the consolidated financial statements  in
    the  2005  Form 10-K, the Company has a valuation allowance  against
    the  full  amount  of  its  net deferred tax  asset.  The  Company's
    deferred tax asset valuation allowance increased $28 million  during
    the  three months ended March 31, 2006 to $1.8 billion as of March
    31, 2006.


                                    -5-

AMERICAN AIRLINES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)

6.  On March 27, 2006, American refinanced its bank credit facility.
    In  general,  the new credit facility adjusted the amounts  borrowed
    under  the  senior secured revolving credit facility and the  senior
    secured term loan facility, reduced the overall interest rate on the
    combined credit facility and favorably modified certain debt covenant
    requirements.

    The  total  amount  of  the credit facility is  $773  million.   The
    credit  facility consists of a $325 million senior secured revolving
    credit  facility  and  a  $448  million  senior  secured  term  loan
    facility  (the  Revolving  Facility  and  the  Term  Loan  Facility,
    respectively,  and  collectively, the Credit  Facility).   The  Term
    Loan  Facility matures on December 17, 2010 and amortizes  quarterly
    at  a  rate  of $1 million.  The Revolving Facility amortizes  at  a
    rate  of $10 million quarterly through December 17, 2007 and  has  a
    final maturity of June 17, 2009.

    Advances  under either facility can be made, at American's election,
    as  LIBOR rate advances or base rate advances.   Interest accrues at
    the  LIBOR  rate or base rate, as applicable, plus, in either  case,
    the  applicable margin.  The applicable margin with respect  to  the
    Revolving  Facility can range from 2.50 percent to 4.00 percent  per
    annum  in the case of LIBOR advances, and from 1.50 percent to  3.00
    percent per annum in the case of base rate advances, depending  upon
    the  senior  secured debt rating of the Credit Facility.   Based  on
    current  ratings,  the  applicable  margin  with  respect   to   the
    Revolving Facility is 3.50 percent per annum, in the case  of  LIBOR
    advances,  and  2.50 percent per annum, in the  case  of  base  rate
    advances.    The  applicable margin with respect to  the  Term  Loan
    Facility  is  3.25 percent per annum in the case of LIBOR  advances,
    and  2.25  percent per annum in the case of base rate advances.   As
    of  March  31,  2006, the Credit Facility had an effective  interest
    rate of 8.29 percent.

    The  Credit  Facility continues to be secured by the same  aircraft.
    The  Credit Facility continues to require periodic appraisals of the
    current  market  value  of the aircraft and requires  that  American
    pledge  more  aircraft or cash collateral if the loan amount  equals
    more  than  50%  of  the  appraised value (after  giving  effect  to
    sublimits  for  specified  categories  of  aircraft).   The   Credit
    Facility  also continues to be secured by all of American's existing
    route  authorities  between  the United  States  and  Tokyo,  Japan,
    together  with certain slots, gates and facilities that support  the
    operation  of  such  routes.  In addition, AMR's  guarantee  of  the
    Credit  Facility  continues to be secured by a  pledge  of  all  the
    outstanding shares of common stock of American.

    The  Credit  Facility  contains a covenant (the Liquidity  Covenant)
    requiring  American  to  maintain  unrestricted  cash,  unencumbered
    short  term  investments  and amounts available  for  drawing  under
    committed  revolving credit facilities which have a  final  maturity
    of  at least 12 months after the date of determination, of not  less
    than  $1.25 billion.  This requirement remains unchanged.

    In  addition,  the Credit Facility continues to contain  a  covenant
    (the  EBITDAR Covenant) requiring AMR to maintain, for  each  period
    of  four  consecutive fiscal quarters ending on the dates  indicated
    below,  a  minimum  ratio of cash flow (defined as consolidated  net
    income,   before  dividends,  interest  expense  (less   capitalized
    interest), income taxes, depreciation and amortization and  rentals,
    adjusted  for certain gains or losses and non-cash items)  to  fixed
    charges  (comprising  interest expense (less  capitalized  interest)
    and  rentals).   The minimum required ratios for  the  four  quarter
    periods  ending  as of specified dates for both the previous  credit
    facility and the refinanced Credit Facility are as set forth below:


                                    -6-

AMERICAN AIRLINES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)


         Four Quarter Period Ending     Original   Refinanced
                                        Credit     Credit
                                        Facility   Facility
                                        Cash Flow  Cash Flow
                                        Coverage   Coverage
                                        Ratio      Ratio
         March 31, 2006                 1.20:1.00  1.00:1.00
         June 30, 2006                  1.25:1.00  1.00:1.00
         September 30, 2006             1.30:1.00  1.10:1.00
         December 31, 2006              1.30:1.00  1.20:1.00
         March 31, 2007                 1.35:1.00  1.30:1.00
         June 30, 2007                  1.40:1.00  1.30:1.00
         September 30, 2007             1.40:1.00  1.35:1.00
         December 31, 2007              1.40:1.00  1.40:1.00
         March 31, 2008                 1.50:1.00  1.40:1.00
         June 30, 2008                  1.50:1.00  1.40:1.00
         September 30, 2008             1.50:1.00  1.40:1.00
         December 31, 2008              1.50:1.00  1.40:1.00
         March 31, 2009                 1.50:1.00  1.40:1.00
         June 30, 2009 (and each
            fiscal quarter thereafter)  1.50:1.00  1.50:1.00

    AMR  and American were in compliance with the Liquidity Covenant and
    the  EBITDAR Covenant as of March 31, 2006 and expect to be able  to
    continue  to  comply  with  these  covenants.   However,  given  the
    historically  high price of fuel and the volatility of  fuel  prices
    and  revenues,  it is difficult to assess whether AMR  and  American
    will,  in  fact,  be able to continue to comply with  the  Liquidity
    Covenant and, in particular, the EBITDAR Covenant, and there are  no
    assurances  that AMR and American will be able to comply with  these
    covenants.

    As  of  March  31,  2006,  American had issued  guarantees  covering
    approximately  $1.2 billion of AMR's unsecured debt.   In  addition,
    as  of  March  31,  2006,  AMR and American  had  issued  guarantees
    covering approximately $408 million of AMR Eagle's secured debt.

7.  The following table provides the components of net periodic
    benefit cost for the three months ended March 31, 2006 and 2005 (in
    millions):
                                                         Other
                                                      Postretirement
                               Pension Benefits          Benefits
                               2006       2005      2006       2005

  Components of net periodic
   benefit cost

   Service cost               $  99     $   92      $   18     $   18
   Interest cost                161        152          47         50
   Expected return on assets   (168)      (165)         (4)        (3)
   Amortization of:
     Prior service cost           4          4          (2)        (2)
     Unrecognized net loss       20         13           1          -

   Net periodic benefit cost  $ 116     $   96      $   60     $   63


                                    -7-

AMERICAN AIRLINES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)


    The  Company expects to contribute approximately $250 million to its
    defined  benefit pension plans in 2006. This estimated  contribution
    reflects  the provisions of the Pension Funding Equity Act  of  2004
    which  deferred  (to 2006 and later plan years)  a  portion  of  the
    minimum  required  contributions that would have been  due  for  the
    2004  and  2005 plan years. Of the $250 million the Company  expects
    to  contribute  to its defined benefit pension plans  in  2006,  the
    Company contributed $36 million during the three months ended  March
    31, 2006 and contributed $84 million on April 14, 2006.

8.  As  a  result  of  the events of September 11, 2001,  the  depressed
    revenue   environment,   high  fuel   prices   and   the   Company's
    restructuring  activities, the Company  has  recorded  a  number  of
    charges  during  the last few years. The following table  summarizes
    the  changes  since December 31, 2005 in the remaining accruals  for
    these charges (in millions):

                              Aircraft     Facility
                              Charges      Exit Costs     Total

      Remaining accrual
      at December 31, 2005     $  150        $   36      $ 186
      Adjustments                  (8)           (7)       (15)
      Payments                     (8)            -         (8)
      Remaining accrual
      at March 31, 2006        $  134        $   29      $ 163


    Cash  outlays  related  to  the accruals for  aircraft  charges  and
    facility exit costs will occur through 2017 and 2018, respectively.

9.  The  Company  includes  changes in the  fair  value  of  certain
    derivative  financial instruments that qualify for hedge accounting,
    changes in minimum pension liabilities and unrealized gains and losses
    on available-for-sale securities in comprehensive loss. For the three
    months  ended  March 31, 2006 and 2005, comprehensive loss  was  $86
    million  and $126 million, respectively. The difference between  net
    loss and comprehensive loss for the three months ended March 31, 2006
    and  2005  is  due  primarily to the accounting  for  the  Company's
    derivative financial instruments.

    Ineffectiveness  is  inherent in hedging jet  fuel  with  derivative
    positions   based   in  crude  oil  or  other  crude   oil   related
    commodities.   As  required  by Statement  of  Financial  Accounting
    Standard  No.  133,  "Accounting  for  Derivative  Instruments   and
    Hedging Activities", the Company assesses, both at the inception  of
    each  hedge  and on an on-going basis, whether the derivatives  that
    are  used  in  its  hedging  transactions are  highly  effective  in
    offsetting  changes in cash flows of the hedged items.  The  Company
    discontinues hedge accounting prospectively if it determines that  a
    derivative is no longer expected to be highly effective as  a  hedge
    or  if  it  decides to discontinue the hedging relationship.   As  a
    result  of  its  quarterly  effectiveness  assessment,  the  Company
    determined  that  certain  of its derivatives  settling  during  the
    remainder  of 2006 are no longer expected to be highly effective  in
    offsetting changes in forecasted jet fuel purchases.  As  a  result,
    effective  on January 1, 2006, all subsequent changes  in  the  fair
    value  of  those  particular hedge contracts  are  being  recognized
    directly   in  Miscellaneous-net  rather  than  being  deferred   in
    Accumulated  other comprehensive loss. Such amount is  not  expected
    to  be  material. Hedge accounting will continue to  be  applied  to
    derivatives  used  to hedge forecasted jet fuel purchases  that  are
    expected to remain highly effective.

                                    -8-


Item  2.   Management's Discussion and Analysis of Financial Condition
and Results of Operations

Forward-Looking Information

Statements  in this report contain various forward-looking  statements
within  the meaning of Section 27A of the Securities Act of  1933,  as
amended,  and Section 21E of the Securities Exchange Act of  1934,  as
amended,  which  represent  the  Company's  expectations  or   beliefs
concerning future events.  When used in this document and in documents
incorporated  herein  by  reference,  the  words  "expects,"  "plans,"
"anticipates,"   "indicates,"  "believes,"   "forecast,"   "guidance,"
"outlook,"  "may,"  "will,"  "should,"  and  similar  expressions  are
intended   to  identify  forward-looking  statements.  Forward-looking
statements  include,  without limitation, the  Company's  expectations
concerning  operations and financial conditions, including changes  in
capacity,  revenues,  and  costs, future financing  plans  and  needs,
overall   economic  conditions,  plans  and  objectives   for   future
operations, and the impact on the Company of its results of operations
in  recent  years  and the sufficiency of its financial  resources  to
absorb   that   impact.  Other  forward-looking   statements   include
statements  which do not relate solely to historical facts,  such  as,
without  limitation,  statements which  discuss  the  possible  future
effects  of  current known trends or uncertainties, or which  indicate
that  the  future effects of known trends or uncertainties  cannot  be
predicted,  guaranteed or assured.  All forward-looking statements  in
this report are based upon information available to the Company on the
date  of this report. The Company undertakes no obligation to publicly
update or revise any forward-looking statement, whether as a result of
new information, future events, or otherwise.

Forward-looking  statements are subject to a number  of  factors  that
could cause the Company's actual results to differ materially from the
Company's expectations.  The following factors, in addition  to  other
possible factors not listed, could cause the Company's actual  results
to   differ   materially  from  those  expressed  in   forward-looking
statements:   the  materially  weakened  financial  condition  of  the
Company,  resulting from its significant losses in recent  years;  the
ability   of   the  Company  to  generate  additional   revenues   and
significantly  reduce  its  costs;  changes  in  economic  and   other
conditions  beyond the Company's control, and the volatile results  of
the  Company's operations; the Company's substantial indebtedness  and
other  obligations;  the ability of the Company  to  satisfy  existing
financial  or  other  covenants in certain of its  credit  agreements;
continued high fuel prices and further increases in the price of fuel,
and  the  availability  of  fuel;  the fiercely  competitive  business
environment  faced by the Company, and historically low  fare  levels;
competition with reorganized and reorganizing carriers; the  Company's
reduced  pricing  power; the Company's need to raise additional  funds
and its ability to do so on acceptable terms; changes in the Company's
business  strategy;  government regulation of the Company's  business;
conflicts overseas or terrorist attacks; uncertainties with respect to
the  Company's international operations; outbreaks of a disease  (such
as SARS or avian flu) that affects travel behavior; uncertainties with
respect  to  the  Company's  relationships with  unionized  and  other
employee   work  groups;  increased  insurance  costs  and   potential
reductions  of available insurance coverage; the Company's ability  to
retain key management personnel; potential failures or disruptions  of
the  Company's  computer, communications or other technology  systems;
changes  in  the price of AMR's common stock; and the ability  of  the
Company to reach acceptable agreements with third parties.  Additional
information  concerning these and other factors is  contained  in  the
Company's  Securities and Exchange Commission filings,  including  but
not limited to the Company's 2005 Form 10-K (see in particular Item 1A
"Risk Factors" in the 2005 Form 10-K).

Overview

The  Company incurred a $106 million net loss in the first quarter  of
2006  compared to a net loss of $171 million in the same  period  last
year.   The Company's first quarter 2006 results were impacted by  the
continuing increase in fuel prices, offset by an improvement  in  unit
revenues  (passenger revenue per available seat mile).  The  Company's
first  quarter 2005 results included a benefit of $69 million  related
to certain excise tax refunds - - $55 million of which was recorded in
aircraft fuel expense and $14 million in interest income.

Fuel  price increases resulted in a year-over-year increase  of  52.5
cents per gallon for the first quarter (including the benefit of  the
7.5  cents  per gallon impact of the fuel excise tax refund  in  2005
discussed  above).  This  price  increase  negatively  impacted  fuel
expense  by  $370 million (including the benefit of the  $55  million
fuel  excise  tax refund in 2005 discussed above) during the  quarter
based   on  American's  fuel  consumption  of  705  million  gallons.
Continuing  high fuel prices, additional increases in  the  price  of
fuel,  and/or  disruptions  in  the  supply  of  fuel  would  further
adversely affect the Company's financial condition and its results of
operations.


                                    -9-

Mainline passenger unit revenues increased 10.8 percent for the first
quarter  due  to a 1.8 point load factor increase and an 8.2  percent
increase  in  passenger yield (passenger revenue per passenger  mile)
compared to the same period in 2005. Although load factor performance
and  passenger  yield showed significant year-over-year  improvement,
passenger  yield  remains  depressed by  historical  standards.   The
Company believes this depressed passenger yield is due in large  part
to  a  corresponding  decline  in the Company's  pricing  power.  The
Company's  reduced pricing power is the product of  several  factors,
including:  greater  cost  sensitivity  on  the  part  of   travelers
(particularly  business  travelers); pricing  transparency  resulting
from  the  use  of  the Internet; greater competition  from  low-cost
carriers  and  from  carriers that have recently reorganized  or  are
reorganizing,  including under the protection of Chapter  11  of  the
U.S.  Bankruptcy Code; other carriers that are better hedged  against
rising fuel costs and able to better absorb the current high jet fuel
prices;  and, more recently, fare simplification efforts  by  certain
carriers.  The Company believes that its reduced pricing  power  will
persist indefinitely and possibly permanently.

The  Company's  ability  to  become profitable  and  its  ability  to
continue to fund its obligations on an ongoing basis will depend on a
number  of  factors, many of which are largely beyond  the  Company's
control.  Some of the risk factors that affect the Company's business
and   financial   results  are  referred  to  under  "Forward-Looking
Information"  above and are discussed in the Risk Factors  listed  in
Item  1A (on pages 11-16) in the 2005 Form 10-K. As the Company seeks
to improve its financial condition, it must continue to take steps to
generate  additional revenues and to significantly reduce its  costs.
Although the Company has a number of initiatives underway to  address
its  cost  and  revenue  challenges, the ultimate  success  of  these
initiatives is not known at this time and cannot be assured.  It will
be  very difficult, absent continued restructuring of its operations,
for  the  Company to continue to fund its obligations on  an  ongoing
basis,  or  to  become  profitable, if the overall  industry  revenue
environment  does not continue to improve and fuel prices  remain  at
historically high levels for an extended period.

LIQUIDITY AND CAPITAL RESOURCES

Significant Indebtedness and Future Financing

The  Company  remains heavily indebted and has significant obligations
(including substantial pension funding obligations), as described more
fully under Item 7, "Management's Discussion and Analysis of Financial
Condition and Results of Operations" in the 2005 Form 10-K.  As of the
date of this Form 10-Q, the Company believes it should have sufficient
liquidity to fund its operations for the foreseeable future, including
repayment  of debt and capital leases, capital expenditures and  other
contractual obligations. However, to maintain sufficient liquidity  as
the   Company  continues  to  implement  its  restructuring  and  cost
reduction  initiatives, and because the Company has significant  debt,
lease  and  other obligations in the next several years,  as  well  as
substantial pension funding obligations, the Company will need  access
to  additional  funding.  The  Company's  possible  financing  sources
primarily include: (i) a limited amount of additional secured aircraft
debt (a very large majority of the Company's owned aircraft, including
virtually  all  of the Company's Section 1110-eligible  aircraft,  are
encumbered)  or sale-leaseback transactions involving owned  aircraft;
(ii)  debt  secured by new aircraft deliveries; (iii) debt secured  by
other  assets;  (iv) securitization of future operating receipts;  (v)
the  sale or monetization of certain assets; and (vi) unsecured  debt.
However, the availability and level of these financing sources  cannot
be  assured,  particularly in light of the Company's recent  financial
results,  substantial indebtedness, reduced credit ratings, high  fuel
prices,  the historically weak revenues and the financial difficulties
being  experienced  in  the airline industry.  The  inability  of  the
Company to obtain additional funding on acceptable terms would have  a
material  adverse impact on the ability of the Company to sustain  its
operations over the long-term.

The  Company's  substantial indebtedness and other  obligations  could
have  important consequences.  For example, they could: (i) limit  the
Company's ability to obtain additional financing for working  capital,
capital expenditures, acquisitions and general corporate purposes,  or
adversely  affect the terms on which such financing could be obtained;
(ii) require the Company to dedicate a substantial portion of its cash
flow  from  operations  to  payments on  its  indebtedness  and  other
obligations, thereby reducing the funds available for other  purposes;
(iii)  make  the  Company more vulnerable to economic downturns;  (iv)
limit  its  ability to withstand competitive pressures and reduce  its
flexibility   in   responding  to  changing  business   and   economic
conditions;  and (v) limit the Company's flexibility in planning  for,
or  reacting to, changes in its business and the industry in which  it
operates.


                                    -10-


Credit Facility Covenants

American has a credit facility (the Credit Facility) consisting  of  a
fully drawn $325 million senior secured revolving credit facility with
a  final maturity on June 17, 2009 and a fully drawn $448 million term
loan  facility with a final maturity on December 17, 2010. The  Credit
Facility  was  recently  refinanced as described  in  Note  6  to  the
condensed  consolidated  financial  statements.  The  Credit  Facility
contains  a  covenant (the Liquidity Covenant) requiring  American  to
maintain,  as  defined,  unrestricted cash,  unencumbered  short  term
investments   and  amounts  available  for  drawing  under   committed
revolving  credit facilities of not less than $1.25 billion  for  each
quarterly period through the life of the Credit Facility. In addition,
the  Credit  Facility  contains  a  covenant  (the  EBITDAR  Covenant)
requiring   AMR  to  maintain  a  ratio  of  cash  flow  (defined   as
consolidated  net  income, before interest expense  (less  capitalized
interest),  income taxes, depreciation and amortization  and  rentals,
adjusted  for  certain gains or losses and non-cash  items)  to  fixed
charges  (comprising interest expense (less capitalized interest)  and
rentals).   The required ratio was 1.00 to 1.00 for the  four  quarter
period  ending March 31, 2006 and will increase gradually to  1.50  to
1.00  for  the four quarter period ending June 30, 2009 and  for  each
four quarter period ending on each fiscal quarter thereafter. AMR  and
American  were  in  compliance with the  Liquidity  Covenant  and  the
EBITDAR  covenant  as  of March 31, 2006 and  expect  to  be  able  to
continue   to  comply  with  these  covenants.   However,  given   the
historically high price of fuel and the volatility of fuel prices  and
revenues, it is difficult to assess whether AMR and American will,  in
fact,  be able to continue to comply with the Liquidity Covenant  and,
in  particular, the EBITDAR Covenant, and there are no assurances that
AMR and American will be able to comply with these covenants.  Failure
to  comply  with these covenants would result in a default  under  the
Credit  Facility which - - if the Company did not take steps to obtain
a  waiver of, or otherwise mitigate, the default - - could result in a
default  under  a significant amount of the Company's other  debt  and
lease obligations and otherwise adversely affect the Company.

Pension Funding Obligation

The  Company expects to contribute approximately $250 million  to  its
defined benefit pension plans in 2006. The Company's estimates of  its
defined  benefit pension plan contributions reflect the provisions  of
the  Pension  Funding  Equity Act of 2004. Of  the  $250  million  the
Company expects to contribute to its defined benefit pension plans  in
2006,  the  Company contributed $36 million during  the  three  months
ended March 31, 2006 and contributed $84 million on April 14, 2006.

Under  Generally Accepted Accounting Principles, the Company's defined
benefit plans were underfunded as of December 31, 2005 by $3.2 billion
based  on  the Projected Benefit Obligation (PBO) and by $2.3  billion
based on the Accumulated Benefit Obligation (ABO) (refer to Note 10 to
the  consolidated financial statements in the 2005  Form  10-K).   The
Company's funded status at December 31, 2005 under the relevant  ERISA
funding  standard  is  similar  to its funded  status  using  the  ABO
methodology.   Due to uncertainties regarding significant  assumptions
involved  in  estimating future required contributions to its  defined
benefit  pension plans, such as interest rate levels, the  amount  and
timing  of  asset returns, and, in particular, the impact of  proposed
legislation currently pending the reconciliation process of  the  U.S.
Congress,  the Company is not able to reasonably estimate  its  future
required   contributions  beyond  2006.  However,  absent  significant
legislative  relief  or  significant  favorable  changes   in   market
conditions, or both, the Company could be required to fund in  2007  a
majority  of the underfunded balance under the relevant ERISA  funding
standard.    Even  with  significant  legislative  relief   (including
proposed airline-specific relief), the Company's 2007 required minimum
contributions  are  expected  to be higher  than  the  Company's  2006
contributions.

Cash Flow Activity

At  March 31, 2006, the Company had $4.2 billion in unrestricted cash
and short-term investments, an increase of $451 million from December
31,  2005.   Net cash provided by operating activities in the  three-
month  period ended March 31, 2006 was $732 million, an  increase  of
$319  million  over  the  same period in 2005  primarily  due  to  an
increase  in the Air traffic liability.  The Company contributed  $36
million to its defined benefit pension plans in the first quarter  of
2006 compared to $138 million during the first quarter of 2005.

Capital  expenditures for the first three months of  2006  were  $101
million  and  primarily included the acquisition of one  Boeing  777-
200ER  aircraft  and the cost of improvements at New York's  John  F.
Kennedy   airport   (JFK).   Substantially  all  of   the   Company's
construction  costs  at  JFK  will  be  reimbursed  through  a   fund
established from a previous financing transaction.


                                    -11-


RESULTS OF OPERATIONS

For the Three Months Ended March 31, 2006 and 2005

Revenues

The  Company's revenues increased approximately $590 million, or 12.5
percent,  to $5.3 billion in the first quarter of 2006 from the  same
period  last year.  American's passenger revenues increased  by  10.5
percent,  or $403 million, on approximately flat capacity  (available
seat  mile)  (ASM).  American's passenger load factor  increased  1.8
points to 77.2 percent while passenger yield increased by 8.2 percent
to  12.85  cents.  This resulted in an increase in passenger  revenue
per  available  seat  mile  (RASM) of 10.8  percent  to  9.93  cents.
Following is additional information regarding American's domestic and
international RASM and capacity:

                                 Three Months Ended March 31, 2006
                               RASM      Y-O-Y      ASMs        Y-O-Y
                             (cents)     Change   (billions)    Change

   DOT Domestic                 10.09     13.8%      27.6       (2.2)%
   International                 9.62      5.2       15.1        3.7
      DOT Latin America         10.46     10.9        7.7       (2.8)
      DOT Atlantic               9.06      0.7        5.5        7.1
      DOT Pacific                7.79     (3.6)       1.8       26.3

Regional  Affiliates include two wholly owned subsidiaries,  American
Eagle Airlines, Inc. and Executive Airlines, Inc. (collectively,  AMR
Eagle), and two independent carriers with which American has capacity
purchase  agreements, Trans States Airlines, Inc. (Trans States)  and
Chautauqua Airlines, Inc. (Chautauqua).

Regional  Affiliates' passenger revenues, which are based on industry
standard  proration  agreements for flights  connecting  to  American
flights, increased $118 million, or 26.2 percent, to $569 million  as
a  result  of  increased capacity, load factors and passenger  yield.
Regional  Affiliates' traffic increased 20.8 percent to  2.3  billion
revenue passenger miles (RPMs), while capacity increased 11.7 percent
to  3.3  billion  ASMs,  resulting in a 5.2  point  increase  in  the
passenger load factor to 69.9 percent.  Passenger yield increased 4.4
percent to 24.97 cents.

Cargo  revenues increased 1.6 percent, or $3 million, to $186  million
as  a result of a $10 million increase in fuel surcharges offset by  a
3.3 percent decrease in cargo ton miles.

Other revenues increased 25.2 percent, or $66 million, to $328 million
due in part to increased third-party maintenance contracts obtained by
the  Company's  maintenance and engineering  group  and  increases  in
certain passenger fees.


Operating Expenses

The Company's total operating expenses increased 10.3 percent, or $494
million, to $5.3 billion in the first quarter of 2006 compared to  the
first quarter of 2005.  American's mainline operating expenses per ASM
in  the  first quarter of 2006 increased 10.3 percent to  10.81  cents
compared  to  the  first  quarter of 2005.  These  increases  are  due
primarily to a 38.4 percent increase in American's price per gallon of
fuel  in  the first quarter of 2006 relative to the first  quarter  of
2005 (including the benefit of a $55 million fuel excise tax refund in
2005).    The   Company's   operating  and   financial   results   are
significantly affected by the price of jet fuel. Continuing high  fuel
prices,  additional increases in the price of fuel, and/or disruptions
in  the  supply  of fuel would further adversely affect the  Company's
financial condition and results of operations.


                                    -12-


    (in millions)               Three Months
                                   Ended          Change      Percentage
   Operating Expenses          March 31,2006     from 2005      Change

   Wages, salaries and benefits   $  1,576        $   74           4.9%
   Aircraft fuel                     1,332           336          33.7 (a)
   Regional payments to AMR Eagle      532            59          12.5 (b)
   Other rentals and
     landing fees                      286            13           4.8
   Commissions, booking fees
     and credit card expense           269            (2)         (0.7)
   Depreciation and amortization       240            (5)         (2.0)
   Maintenance, materials
     and repairs                       187            (5)         (2.6)
   Aircraft rentals                    141            (2)         (1.4)
   Food service                        123             -             -
   Other operating expenses            589            26           4.6
     Total operating expenses     $  5,275        $  494          10.3%

(a)  Aircraft fuel expense increased primarily due to a 38.4 percent
     increase in American's price per gallon of fuel (including the benefit
     of a $55 million fuel excise tax refund received in March 2005 and the
     impact of fuel hedging) offset by a 3.3 percent decrease in American's
     fuel consumption.
(b)  Regional payments to AMR Eagle increased primarily as a result of
     increased capacity and fuel cost.

Other Income (Expense)

Interest expense increased $38 million due primarily to an increase in
variable interest rates.

Income Tax Benefit

The Company did not record a net tax benefit associated with its first
quarter  2006 and 2005 losses due to the Company providing a valuation
allowance,  as  discussed  in  Note 5 to  the  condensed  consolidated
financial statements.

Regional Affiliates

The following table summarizes the combined capacity purchase activity
for  the  American  Connection carriers and AMR Eagle  for  the  three
months ended March 31, 2006 and 2005 (in millions):

                                               Three Months Ended March 31,
                                                     2006       2005
  Revenues:
   Regional Affiliates                           $    569   $    451
   Other                                               24         20
                                                 $    593   $    471
  Expenses:
   Regional payments                             $    580   $    517
   Other incurred expenses                             74         66
                                                 $    654   $    583

In addition, passengers connecting to American's flights from American
Connection  and  AMR  Eagle flights generated passenger  revenues  for
American flights of $402 million and $350 million in the first quarter
of  2006  and  2005, respectively, which are included  in  Revenues  -
Passenger in the consolidated statements of operations.


                                    -13-


Outlook

The  Company currently expects second quarter 2006 mainline unit costs
to  increase more than seven percent year over year and full year 2006
mainline  unit costs to increase approximately five percent year  over
year.

Capacity for American's mainline jet operations is expected to decline
about one percent in the second quarter of 2006 compared to the second
quarter of 2005 and also in the full year 2006 compared to 2005.


                                    -14-


Item 3.  Quantitative and Qualitative Disclosures about Market Risk

There  have  been  no  material  changes  in  market  risk  from   the
information   provided  in  Item  7A.  Quantitative  and   Qualitative
Disclosures  About Market Risk of the Company's 2005  Form  10-K.  The
change  in  market  risk  for aircraft fuel  is  discussed  below  for
informational purposes.

The  risk inherent in the Company's fuel related market risk sensitive
instruments  and positions is the potential loss arising from  adverse
changes  in the price of fuel.  The sensitivity analyses presented  do
not consider the effects that such adverse changes may have on overall
economic  activity, nor do they consider additional actions management
may   take  to  mitigate  the  Company's  exposure  to  such  changes.
Therefore,  actual results may differ.  The Company does not  hold  or
issue derivative financial instruments for trading purposes.

Aircraft Fuel   The Company's earnings are affected by changes in  the
price  and  availability of aircraft fuel.   In  order  to  provide  a
measure of control over price and supply, the Company trades and ships
fuel  and  maintains  fuel storage facilities to  support  its  flight
operations.   The Company also manages the price risk  of  fuel  costs
primarily  by  using  jet fuel, heating oil,  and  crude  oil  hedging
contracts.   Market  risk  is estimated as a hypothetical  10  percent
increase  in  the March 31, 2006 cost per gallon of  fuel.   Based  on
projected  2006 and 2007 fuel usage through March 31,  2007,  such  an
increase  would  result  in an increase to aircraft  fuel  expense  of
approximately $496 million in the twelve months ended March 31,  2007,
inclusive   of   the  impact  of  effective  fuel  hedge   instruments
outstanding at March 31, 2006, and assumes the Company's fuel  hedging
program  remains  effective under Statement  of  Financial  Accounting
Standards No. 133, "Accounting for Derivative Instruments and  Hedging
Activities".  Comparatively, based on projected 2006 fuel usage,  such
an  increase  would  have  resulted in an increase  to  aircraft  fuel
expense  of  approximately $477 million in  the  twelve  months  ended
December  31, 2006, inclusive of the impact of fuel hedge  instruments
outstanding  at  December  31, 2005.  The change  in  market  risk  is
primarily due to the increase in fuel prices.

Ineffectiveness  is  inherent  in hedging  jet  fuel  with  derivative
positions  based in crude oil or other crude oil related  commodities.
As  required  by Statement of Financial Accounting Standard  No.  133,
"Accounting  for  Derivative Instruments and Hedging Activities",  the
Company  assesses, both at the inception of each hedge and on  an  on-
going  basis,  whether the derivatives that are used  in  its  hedging
transactions are highly effective in offsetting changes in cash  flows
of  the  hedged  items.  The  Company  discontinues  hedge  accounting
prospectively if it determines that a derivative is no longer expected
to  be highly effective as a hedge or if it decides to discontinue the
hedging  relationship.   As  a result of its  quarterly  effectiveness
assessment,  the  Company determined that certain of  its  derivatives
settling  during the remainder of 2006 are no longer  expected  to  be
highly  effective  in  offsetting  changes  in  forecasted  jet   fuel
purchases.   As a result, effective on January 1, 2006, all subsequent
changes  in  the  fair value of those particular hedge  contracts  are
being  recognized  directly  in Miscellaneous-net  rather  than  being
deferred in Accumulated other comprehensive loss. Such amount  is  not
expected to be material. Hedge accounting will continue to be  applied
to  derivatives used to hedge forecasted jet fuel purchases  that  are
expected to remain highly effective.

As  of  March  31,  2006, the Company had effective hedges,  including
option contracts and collars, covering approximately 15 percent of its
estimated remaining 2006 fuel requirements and an insignificant amount
of its estimated fuel requirements thereafter.  The consumption hedged
for  the  remainder  of  2006  is  capped  at  an  average  price   of
approximately  $58  per barrel of crude oil.  A deterioration  of  the
Company's  financial  position could negatively affect  the  Company's
ability to hedge fuel in the future.


                                   -15-


Item 4.  Controls and Procedures

The term "disclosure controls and procedures" is defined in Rules 13a-
15(e)  and  15d-15(e) of the Securities Exchange Act of 1934,  or  the
Exchange  Act.  This term refers to the controls and procedures  of  a
company  that are designed to ensure that information required  to  be
disclosed by a company in the reports that it files under the Exchange
Act  is  recorded, processed, summarized and reported within the  time
periods  specified  by  the  Securities and  Exchange  Commission.  An
evaluation   was  performed  under  the  supervision  and   with   the
participation  of  the  Company's  management,  including  the   Chief
Executive  Officer  (CEO) and Chief Financial Officer  (CFO),  of  the
effectiveness  of the Company's disclosure controls and procedures  as
of   March   31,  2006.   Based  on  that  evaluation,  the  Company's
management,  including the CEO and CFO, concluded that  the  Company's
disclosure  controls and procedures were effective  as  of  March  31,
2006. During the quarter ending on March 31, 2006, there was no change
in  the  Company's internal control over financial reporting that  has
materially affected, or is reasonably likely to materially affect, the
Company's internal control over financial reporting.


                                   -16-



PART II:  OTHER INFORMATION

Item 1.  Legal Proceedings

On  July  26, 1999, a class action lawsuit was filed, and in  November
1999 an amended complaint was filed, against AMR, American, AMR Eagle,
Airlines Reporting Corporation, and the Sabre Group Holdings, Inc.  in
the  United  States  District  Court  for  the  Central  District   of
California,  Western  Division (Westways World  Travel,  Inc.  v.  AMR
Corp., et al.).  The lawsuit alleges that requiring travel agencies to
pay  debit  memos to American for violations of American's fare  rules
(by  customers  of  the agencies):  (1) breaches the  Agent  Reporting
Agreement   between  American  and  AMR  Eagle  and  the   plaintiffs;
(2)  constitutes  unjust  enrichment; and (3) violates  the  Racketeer
Influenced and Corrupt Organizations Act of 1970 (RICO).  On  July  9,
2003,  the  court certified a class that included all travel  agencies
who  have been or will be required to pay money to American for  debit
memos  for  fare rules violations from July 26, 1995 to  the  present.
The  plaintiffs sought to enjoin American from enforcing  the  pricing
rules  in  question and to recover the amounts paid for  debit  memos,
plus  treble damages, attorneys' fees and costs. On February 24, 2005,
the   court  decertified  the  class.   The  claims  against  Airlines
Reporting Corporation have been dismissed, and in September 2005,  the
Court  granted Summary Judgment in favor of the Company and all  other
defendants.   Plaintiffs have filed an appeal  to  the  United  States
Court of Appeals for the Ninth Circuit.  Although the Company believes
that  the  litigation is without merit, a final adverse court decision
could  impose restrictions on the Company's relationships with  travel
agencies, which could have a material adverse impact on the Company.

Between  April 3, 2003 and June 5, 2003, three lawsuits were filed  by
travel  agents  some of whom opted out of a prior  class  action  (now
dismissed) to pursue their claims individually against American, other
airline defendants, and in one case against certain airline defendants
and  Orbitz LLC.  (Tam Travel et. al., v. Delta Air Lines et. al.,  in
the  United  States  District  Court  for  the  Northern  District  of
California  -  San  Francisco (51 individual agencies),  Paula  Fausky
d/b/a  Timeless  Travel v. American Airlines, et. al,  in  the  United
States  District  Court  for the Northern  District  of  Ohio  Eastern
Division  (29 agencies) and Swope Travel et al. v. Orbitz et.  al.  in
the  United States District Court for the Eastern District  of  Texas,
Beaumont  Division (6 agencies)).  Collectively, these  lawsuits  seek
damages  and  injunctive  relief alleging  that  the  certain  airline
defendants and Orbitz LLC: (i) conspired to prevent travel agents from
acting as effective competitors in the distribution of airline tickets
to  passengers  in  violation of Section 1 of the Sherman  Act;   (ii)
conspired to monopolize the distribution of common carrier air  travel
between airports in the United States in violation of Section 2 of the
Sherman  Act; and that (iii) between 1995 and the present, the airline
defendants  conspired to reduce commissions paid to U.S.-based  travel
agents in violation of Section 1 of the Sherman Act. These cases  have
been consolidated in the United States District Court for the Northern
District  of Ohio, Eastern Division.  American is vigorously defending
these  lawsuits.  A final adverse court decision awarding  substantial
money  damages  or placing restrictions on the Company's  distribution
practices would have a material adverse impact on the Company.

On  August  19, 2002, a class action lawsuit seeking monetary  damages
was  filed, and on May 7, 2003, an amended complaint was filed in  the
United  States District Court for the Southern District  of  New  York
(Power Travel International, Inc. v. American Airlines, Inc., et  al.)
against  American,  Continental  Airlines,  Delta  Air  Lines,  United
Airlines, and Northwest Airlines, alleging that American and the other
defendants breached their contracts with the agency and were  unjustly
enriched  when  these  carriers at various times  reduced  their  base
commissions to zero.  The as yet uncertified class includes all travel
agencies accredited by the Airlines Reporting Corporation "whose  base
commissions on airline tickets were unilaterally reduced to  zero  by"
the  defendants.   The  claims  against  Delta  Air  Lines  have  been
dismissed, and the case is stayed as to United Airlines and  Northwest
Airlines  since  they  filed for bankruptcy.  American  is  vigorously
defending  the  lawsuit.   Although  the  Company  believes  that  the
litigation  is without merit, a final adverse court decision  awarding
substantial  money  damages  or forcing  the  Company  to  pay  agency
commissions would have an adverse impact on the Company.


                                   -17-

Miami-Dade   County  (the  County)  is  currently  investigating   and
remediating   various   environmental   conditions   at   the    Miami
International Airport (MIA) and funding the remediation costs  through
landing  fees  and  various cost recovery methods.  American  and  AMR
Eagle  have  been named as potentially responsible parties (PRPs)  for
the  contamination  at MIA.  During the second quarter  of  2001,  the
County  filed a lawsuit against 17 defendants, including American,  in
an  attempt  to recover its past and future cleanup costs  (Miami-Dade
County, Florida v. Advance Cargo Services, Inc., et al. in the Florida
Circuit  Court). The Company is vigorously defending the lawsuit.   In
addition to the 17 defendants named in the lawsuit, 243 other agencies
and  companies  were  also  named as  PRPs  and  contributors  to  the
contamination.  The case is currently stayed while the parties  pursue
an  alternative dispute resolution process.  The County  has  proposed
draft  allocation models for remedial costs for the Terminal and  Tank
Farm  areas  of  MIA.  While it is anticipated that American  and  AMR
Eagle  will  be  allocated equitable shares  of  remedial  costs,  the
Company  does  not  expect the allocated amounts to  have  a  material
adverse effect on the Company.

Four  cases  (each  being a purported class action)  have  been  filed
against American arising from the disclosure of passenger name records
by  a vendor of American.  The cases are:  Kimmell v. AMR, et al.  (U.
S.  District  Court, Texas), Baldwin v. AMR, et al.  (U.  S.  District
Court,  Texas),  Rosenberg v. AMR, et al. (U. S. District  Court,  New
York)  and  Anapolsky v. AMR, et al. (U.S. District Court, New  York).
The  Kimmell  suit was filed in April 2004. The Baldwin and  Rosenberg
cases  were  filed  in  May  2004. The Anapolsky  suit  was  filed  in
September  2004.  The suits allege various causes of action, including
but  not  limited  to,  violations of  the  Electronic  Communications
Privacy  Act,  negligent  misrepresentation, breach  of  contract  and
violation  of  alleged  common law rights of privacy.   In  each  case
plaintiffs  seek  statutory  damages  of  $1000  per  passenger,  plus
additional  unspecified  monetary damages.  The  Court  dismissed  the
cases  but  allowed leave to amend, and the plaintiffs in the  Kimmell
and  Rosenberg cases filed amended complaints on June 24,  2005.   The
Company is vigorously defending these suits and believes the suits are
without  merit.  However,  a  final adverse  court  decision  awarding
substantial money damages would have a material adverse impact on  the
Company.

American  is  defending two lawsuits, filed as class actions  but  not
certified  as such, arising from allegedly improper failure to  refund
certain governmental taxes and fees collected by the Company upon  the
sale  of  nonrefundable tickets when such tickets  are  not  used  for
travel.   In  Harrington  v. Delta Air Lines,  Inc.,  et  al.,  (filed
November 24, 2004 in the United States District Court for the District
of  Massachusetts),  the  plaintiffs seek unspecified  actual  damages
(trebled),   declaratory  judgment,  injunctive  relief,  costs,   and
attorneys' fees.  The suits assert various causes of action, including
breach of contract, conversion, and unjust enrichment against American
and   numerous  other  airline  defendants.   Additionally,  the  same
attorneys representing the Harrington plaintiffs have filed a qui  tam
suit  entitled  Teitelbaum v. Alaska Airlines, et  al.   American  was
notified it is a defendant in this case in December 2005.  This  case,
also  pending in the United States District Court for the District  of
Massachusetts, asserts essentially the same claims (but  also  asserts
that the United States has been damaged) and requests essentially  the
same relief on behalf of the United States.  The Company is vigorously
defending the suits and believes them to be without merit.  However, a
final adverse court decision requiring the Company to refund collected
taxes and/or fees could have a material adverse impact on the Company.

On  March  11,  2004, a patent infringement lawsuit was filed  against
AMR,  American, AMR Eagle Holding Corporation, and American  Eagle  in
the  United  States District Court for the Eastern District  of  Texas
(IAP  Intermodal,  L.L.C.  v.  AMR  Corp.,  et  al.).  The  case   was
consolidated  with eight similar lawsuits filed against  a  number  of
other unaffiliated airlines, including Continental, Northwest, British
Airways,  Air  France,  Pinnacle Airlines, Korean  Air  and  Singapore
Airlines  (as  well as various regional affiliates of the  foregoing).
The  plaintiff  alleges  that the airline  defendants  infringe  three
patents,  each  of  which relates to a system of  scheduling  vehicles
based  on freight and passenger transportation requests received  from
remote  computer terminals.  The plaintiff is seeking past and  future
royalties  of over $30 billion dollars, injunctive relief,  costs  and
attorneys'  fees. On September 7, 2005, the court issued a  memorandum
opinion that interpreted disputed terms in the patents.  The plaintiff
dismissed  its  claims without prejudice to its right  to  appeal  the
September  7,  2005  opinion, and the plaintiff is  pursuing  such  an
appeal. Although the Company believes that the plaintiff's claims  are
without merit and is vigorously defending the lawsuit, a final adverse
court  decision awarding substantial money damages or placing material
restrictions  on existing scheduling practices would have  a  material
adverse impact on the Company.


                                   -18-


On  July  12,  2004, a consolidated class action complaint,  that  was
subsequently amended on November 30, 2004, was filed against  American
and  the  Association  of Professional Flight Attendants  (APFA),  the
Union  which  represents  the  Company's  flight  attendants  (Ann  M.
Marcoux,  et  al.,  v. American Airlines Inc., et al.  in  the  United
States  District Court for the Eastern District of New York). While  a
class  has not yet been certified, the lawsuit seeks on behalf of  all
of  American's flight attendants or various subclasses to  set  aside,
and  to  obtain  damages  allegedly resulting  from,  the  April  2003
Collective  Bargaining  Agreement referred  to  as  the  Restructuring
Participation  Agreement  (RPA).  The  RPA  was  one  of  three  labor
agreements the Company successfully reached with its unions  in  order
to  avoid  filing for bankruptcy in 2003.  In a related  case  (Sherry
Cooper, et al. v. TWA Airlines, LLC, et al., also in the United States
District Court for the Eastern District of New York), the court denied
a preliminary injunction against implementation of the RPA on June 30,
2003.  The  Marcoux suit alleges various claims against the Union  and
American relating to the RPA and the ratification vote on the  RPA  by
individual Union members, including: violation of the Labor Management
Reporting  and Disclosure Act (LMRDA) and the APFA's Constitution  and
By-laws, violation by the Union of its duty of fair representation  to
its  members,  violation by the Company of provisions of  the  Railway
Labor  Act  (RLA) through improper coercion of flight attendants  into
voting or changing their vote for ratification, and violations of  the
Racketeer Influenced and Corrupt Organizations Act of 1970 (RICO).  On
March 28, 2006, the district court dismissed all of various state  law
claims  against  the Company, all but one of the LMRDA claims  against
the  APFA  ,  and   the claimed violations of RICO.  This  leaves  the
claimed  violations  of  the RLA and the duty of  fair  representation
against the Company and the APFA (as well as one  LMRDA claim and  one
claim  against  the  APFA  of  a breach of  the  union  constitution).
Although the Company believes the case against it is without merit and
both the Company and the Union are vigorously defending the lawsuit, a
final  adverse  court  decision  invalidating  the  RPA  and  awarding
substantial money damages would have a material adverse impact on  the
Company.

On  February  14,  2006, the Antitrust Division of the  United  States
Department of Justice (the "DOJ") served the Company with a grand jury
subpoena  as  part of an ongoing investigation into possible  criminal
violations  of the antitrust laws by certain domestic and foreign  air
cargo  carriers. At this time, the Company does not believe  it  is  a
target  of the DOJ investigation.  The New Zealand Commerce Commission
notified   the  Company  on  February  17,  2006  that  it   is   also
investigating  whether the Company and certain  other  cargo  carriers
entered   into  agreements  relating  to  fuel  surcharges,   security
surcharges, war risk surcharges, and customs clearance surcharges.  On
February  22,  2006,  the Company received a  letter  from  the  Swiss
Competition  Commission  informing  the  Company  that   it   too   is
investigating  whether the Company and certain  other  cargo  carriers
entered   into  agreements  relating  to  fuel  surcharges,   security
surcharges,  war  risk  surcharges, and customs clearance  surcharges.
The  Company intends to cooperate fully with these investigations.  In
the  event  that these investigations uncover violations of  the  U.S.
antitrust  laws  or  the competition laws of some other  jurisdiction,
such  findings  and related legal proceedings could  have  a  material
adverse impact on the Company.


                                   -19-


Approximately 25 purported class action lawsuits (Animal Land, Inc. v.
Air  Canada et al. filed in the United States District Court  for  the
Eastern  District  of  New York on February 17, 2006;  Joan  Adams  v.
British  Airways et al. filed in the United States District Court  for
the   Eastern  District  of  New  York  on  February  22,  2006;  Rock
International  Transport  v. Air Canada et al.  filed  in  the  United
States District Court for the Eastern District of New York on February
24,  2006; Helen's Wooden Crafting Co. v. Air Canada et al.  filed  in
the  United States District Court for the Eastern District of New York
on  February 24, 2006; ABM Int'l, Inc. v. Ace Aviation Holdings,  Inc.
et  al.  filed  in  the United States District Court for  the  Eastern
District  of  New York on February 28, 2006; Blumex USA, Inc.  v.  Air
Canada  et  al.  filed  in the United States District  Court  for  the
Northern District of Illinois on March 1, 2006; Mamlaka Video  v.  Air
Canada  et  al.  filed  in the United States District  Court  for  the
Eastern District of New York on March 3, 2006; Spraying Systems Co. v.
ACE Aviation Holdings, Inc. et al. filed in the United States District
Court  for the Eastern District of New York on March 3, 2006; Mitchell
Spitz  v.  Air  France-KLM et al. filed in the United States  District
Court  for  the  Eastern District of New York on March  6,  2006;  JCK
Industries,  Inc. v. British Airways, PLC et al. filed in  the  United
States District Court for the Eastern District of New York on March 6,
2006;  Marc  Seligman v. Air Canada et al. filed in the United  States
District Court for the Southern District of Florida on March 6,  2006;
CID  Marketing and Promotion Inc. v. AMR Corporation et al.  filed  in
the  United  States  District  Court  for  the  Eastern  District   of
Pennsylvania on March 7, 2006; Lynn Culver v. Air Canada et al.  filed
in  the  United States District Court for the District of Columbia  on
March 8, 2006; JSL Carpet Corp. v. ACE Aviation Holdings, Inc. et  al.
filed in the United States District Court for the Eastern District  of
New  York  on March 10, 2006; Y. Hata & Co, Ltd. v. Air France-KLM  et
al.  filed  in  the  United States District  Court  for  the  Northern
District of California on March 13, 2006; FTS International Express v.
ACE Aviation Holdings, Inc. et al. filed in the United States District
Court  for the District of Columbia on March 15, 2006; Thule, Inc.  v.
Air  Canada et al. filed in the United States District Court  for  the
Eastern  District of New York on March 28, 2006; Rosetti Handbags  and
Accessories, Ltd. v. Air France ADS et al. filed in the United  States
District Court for the Eastern District of New York on March 31, 2006;
W.I.T.  Entertainment Inc. v. AMR Corporation  et  al.  filed  in  the
United  States District Court for the Southern District of Florida  on
April  3, 2006; Jeff Rapps v. British Airways PLC et al. filed in  the
United  States District Court for the Eastern District of New York  on
April  7,  2006;  Funke Design Build, Inc. v. AMR Corporation  et  al.
filed in the United States District Court for the Northern District of
Illinois on April 7, 2006; Sul-American Export Inc. v. Air France  ADS
et  al.  filed  in  the United States District Court for  the  Eastern
District  of  New  York on April 7, 2006; La Regale  Ltd.  v.  British
Airways  PLC et al. filed in the Untied States District Court for  the
Eastern District of New York on April 12, 2006; J.A. Transport Inc. v.
ACE Aviation Holdings, Inc. et al. filed in the United States District
Court  for the District of Columbia on April 12, 2006; and Caribe  Air
Cargo,  Inc. v. ACE Aviation Holdings, Inc. et al. filed in the United
States District Court for the District of Columbia on April 13,  2006)
have  been filed against the Company and certain foreign and  domestic
air carriers alleging that the defendants violated U.S. antitrust laws
by  illegally  conspiring  to  set  prices  and  surcharges  on  cargo
shipments.  These cases are expected to be consolidated in an  as  yet
undetermined  court together with approximately 33 other class  action
lawsuits  in  which  the Company has not been named  as  a  defendant.
Plaintiffs  are  seeking trebled money damages and injunctive  relief.
American  will vigorously defend these lawsuits; however, any  adverse
judgment could have a material adverse impact on the Company.


                                   -20-


Item 5.  Other Information

American  has  announced a pay plan, funded at 1.5  percent  of  base
salaries, for all American employees on U.S. payroll, to be effective
May  1,  2006.   On  April 19, 2006, the Board approved  1.5  percent
increases  in the base salaries for officers (including the executive
officers of AMR and American), to be effective May 1, 2006.

Item 6.  Exhibits

The following exhibits are included herein:

10      Amended and Restated Credit Agreement Dated March 27, 2006

12      Computation of ratio of earnings to fixed charges for the  three
        months ended March 31, 2006 and 2005.

31.1    Certification of Chief Executive Officer pursuant to  Rule  13a- 14(a).

31.2    Certification of Chief Financial Officer pursuant to  Rule  13a- 14(a).

32      Certification pursuant to Rule 13a-14(b) and section 906 of  the
        Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350,
        chapter 63 of title 18, United States Code).


                                   -21-




Signature

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.


                               AMERICAN AIRLINES, INC.




Date:  April 20, 2006          BY: /s/ Thomas W. Horton
                               Thomas W. Horton
                               Executive  Vice  President and Chief
                               Financial Officer
                               (Principal Financial and Accounting Officer)



                                   -22-