UNITED STATES
               SECURITIES AND EXCHANGE COMMISSION
                     WASHINGTON, D.C. 20549
                                
                            FORM 10-K

(MARK ONE)

[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
     
     For the fiscal year ended December 31, 1995
  
                              OR

[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
     
     For the transition period from          to  
    
     Commission file number 1-11569

                    RIO HOTEL & CASINO, INC.
     (Exact name of registrant as specified in its charter)

           Nevada                            95-3671082
(State or other jurisdiction              (I.R.S. Employer
of incorporation or organization         Identification No.)

3700 West Flamingo Road, Las Vegas, Nevada 89103
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code 
(702) 252-7733

Securities registered pursuant to Section 12(b) of the Act:

                                            Name of each      
     Title of each class                    exchange on
                                          which registered
                                                  
Common Stock, $.01 par value          New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

                  Common Stock, $.01 par value
                        (Title of class)
<PAGE>

     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  [ ]

     Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of the registrant's
knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.    [ ]

     The aggregate market value of voting stock held by non-
affiliates of the registrant as of February 29, 1996, based on
the closing price as reported on the New York Stock Exchange of
$13.75 per share, was approximately $222,537,398.

     Indicate the number of shares outstanding of each of the
registrant's classes of common stock, as of February 29, 1996.

       Common Stock, $.01 par value        21,178,746    

               DOCUMENTS INCORPORATED BY REFERENCE

The information required by Part III of this Report is
incorporated by reference from the Rio Hotel & Casino, Inc. Proxy
Statement to be filed with the Commission not later than 120 days
after the end of the fiscal year covered by this Report.

                                2

<PAGE>

PART I

ITEM 1.  BUSINESS

     Rio Hotel & Casino, Inc. (the "Company") owns and operates
the country's only all-suite hotel-casino, the Rio Suite Hotel &
Casino (the "Rio") in Las Vegas, Nevada. Situated on a 45-acre
elevated site adjacent to the Flamingo Road exit from Interstate
15, the freeway linking Las Vegas with Southern California, the
Rio is strategically positioned to attract travelers along
Interstate 15, tourists visiting the Las Vegas Strip and local
Las Vegas residents. The Company markets to both local residents
and Las Vegas visitors.  Management believes that the Rio's
unique all-suite concept, diverse high quality dining, easy
access and ample parking provide an attractive alternative to the
Strip and a fun and comfortable environment in which to enjoy
gaming, dining and entertainment.

     Decorated throughout in a fun-filled Brazilian Carnival and
rain forest theme, the Rio is currently comprised of an 89,000
square foot casino, three 21-story hotel towers containing 1,551
suites, eight restaurants, seven bars, a 430-seat entertainment
complex, meeting and banquet space, a 59,000 square foot outdoor
entertainment area featuring a landscaped sand beach and two
swimming pools and parking for over 3,200 cars.  The Rio's casino
offers approximately 2,000 slot machines, 76 table games, a poker
room, keno and a race and sports book.

     The Rio originally opened in 1990 with 424 suites and 44,000
square feet of casino space. Within the past three years the Rio
has been expanded to its present configuration in phases in
accordance with its original master plan. In the fall of 1993,
the Company added a second hotel tower with 437 suites, a new
restaurant and meeting rooms through a $37 million expansion (the
"Phase II Expansion" or "Tower Expansion").  In April 1994, the
Company completed a $25 million expansion (the "Eastside
Expansion") which included a 25,000 square foot addition to the
casino, a two-story parking garage, a new restaurant and the
Copacabana showroom. In March 1995, the Rio completed a $75
million expansion (the "Phase III Expansion")  which encompassed
a third hotel tower with 549 suites, 10,000 square feet of casino
space, a new three-level parking garage and a 50% expansion to
its award winning Carnival World Buffet. In December 1995, the
Company completed a $20 million expansion (the "Phase IV
Expansion") which added 141 suites, approximately 5,400 square
feet of meeting room space, doubled the size of the existing
Buzios seafood restaurant, added a new health club and salon
facility and included a variety of back-of-the-house
improvements. Completion of the Phase IV Expansion brought the
Rio's total number of hotel suites to 1,551.

     In June 1995, the Company announced a three-phased expansion
and development plan intended to be implemented over the next
several years.  The three-phased expansion and development plan
consists of an approximately $185 million expansion at the Rio
(the "Phase V Expansion"), acquisition of approximately 22 acres
of land adjacent to the Rio to be master-planned for the
development of another hotel-casino and the purchase of
approximately 64 acres southeast of Las Vegas (the "Old Vegas
Site") for possible future hotel-casino development.  Of the 22
acres of land adjacent to the Rio, approximately 5 acres were
purchased in 1995 and acquisition agreements have been entered
into for the remaining 17 acres.  The Company expects to finalize
the purchase of all 17 acres during 1996.
                                
                                3

<PAGE>

     The Company was incorporated in California in 1981 and
reincorporated in Nevada in 1988. The Company changed its name
from MarCor Resorts, Inc. to Rio Hotel & Casino, Inc. in February
1992. Its executive offices are located at 3700 West Flamingo
Road, Las Vegas, Nevada 89103, and its telephone number is (702)
252-7733.

PHASE V EXPANSION

     The Phase V Expansion, for which construction commenced in
September 1995, will center around a 41-story curved tower
containing approximately 1,000 new suites located immediately
southeast of the existing towers. The Phase V Expansion is
planned to include 120,000 square feet of public space containing
a casino expansion with capacity for approximately 600 slot
machines and 30 table games, new retail and entertainment space,
6 additional restaurants, including one restaurant at the top of
the tower overlooking the Strip, as well as an expanded pool and
beach area and additional parking facilities. The new suites will
be similar in size and decor to the existing suites.

     As currently contemplated, the public area expansion will be
based upon a Brazilian Carnival Mardi Gras theme. The new casino
area will provide regular entertainment, as periodically a themed
overhead entertainment attraction will provide an interactive
show with patrons. The attraction will feature performers dressed
in festive attire who will sing and dance.  The attraction may
change to celebrate different holidays and special events.

     Management believes the Phase V Expansion will increase the
number of tour and travel customers while enhancing the amenities
available to local patrons. Given the Rio's high average
occupancies and significant room turnaways, management believes
that the additional room inventory will be successfully absorbed.
Opening of the Phase V Expansion is expected to occur in the
spring of 1997.

BUSINESS STRATEGY

     The Company's business strategy focuses on attracting and
fostering repeat business from customers in the local resident
and tourist markets in the middle to upper-middle income
segments.  To implement its business strategy, the Company
capitalizes on its unique all-suite concept, strategic location,
Brazilian Carnival theme, diverse product offering and friendly
service.  The Company strives to provide a quality, affordable
gaming and entertainment experience in order to generate high
customer satisfaction and loyalty. The Rio's value-priced suites
and restaurants provide an attractive alternative to conventional
Las Vegas properties for visitors who desire to avoid the crowds
and congestion of the Strip. The Interstate 15 and Flamingo Road
location is also ideal for attracting local residents.

     To encourage repeat visits, the Company attempts to ensure
that each customer has an enjoyable, high quality and high value
experience. Management believes that it must offer  consistent
quality, a comfortable and fun atmosphere and, most importantly,
friendly service at affordable prices to provide a high value
experience to its customers. Accordingly, the Rio's suites offer
guests approximately 50% more space than comparably priced Las
Vegas hotel rooms. Similarly, the Company's restaurants have won
awards year after year for their quality dining. All of the Rio's

                                 4

<PAGE>

restaurants offer generous portions of high quality food at
reasonable prices which management believes is a major factor in
attracting the value-conscious local customer.

     Management believes that friendly service combined with a
quality facility are integral to generating repeat business from
locals as well as tourists. As a result, management continually
seeks to instill in each employee a sense of service excellence
designed to exceed guest expectations. To motivate its employees,
management also strives to instill a sense of "Team Rio" in all
of the Company's employees.  Management strongly believes that
its employees are one of the Company's biggest assets.

     The Company has created an identifiable and innovative
marketing presence and continues to build on its "signature" Rio
theme. The Rio's Brazilian Carnival and rain forest theme
incorporates bright colors, creative interior designs, festive
employee costumes and other exotic touches to contribute to its
tropical ambiance. The Rio's message of a fun-filled, colorful
atmosphere is constantly emphasized. The Rio has developed the
Rio Rita(TM) character as a promotional ambassador to the Rio's
hotel-casino guests and as a focal point upon which many
promotional activities have been built, such as Rio Rita's(TM)
Paycheck Poker Wheel, Carnival Dice(TM), the Jackpot Jungle(TM),
Rio Rita's(TM) Lotto Bucks, Carnival Days(TM), Copacabana(TM)
Dinner Show, Conga Mania(TM) and Brazilia Days(TM). The Company
advertises extensively in the Las Vegas area print, television
and radio media, and periodically in Southern California, Phoenix
and other regional markets.

     The success of the Company's business strategy is evidenced
by the large number of awards the Rio has received. In March
1995, the Rio won recognition through 10 "Best of Las Vegas"
awards in an annual readers' survey published by Nevada's largest
daily newspaper. Among others, these distinctions included: "Best
Buffet," "Best Italian Restaurant," "Best Coffee Shop," "Best
Steakhouse," "Friendliest Employees" and "Most Efficient
Service." In addition, the Rio received recognition in the 1995
ZAGAT U.S. HOTELS, RESORTS & SPAS SURVEY for "Best Rooms," "Best
Dining," "Best Service" and "Best Overall" in Las Vegas.  Since
these awards, however, are based upon subjective criteria, undue
significance should not be attributed to these awards.
Management believes that these awards exemplify the Company's
reputation for quality and value.

MARKETING STRATEGY

     The Company's marketing efforts are targeted at both the
local patron and the tourist market. To market to local patrons,
the Rio relies on its convenient location, its ample parking, its
value-priced food and its slot machine variety. Management
believes that its restaurants, in particular the Carnival World
Buffet, are some of the Rio's greatest attractions for local
patrons. The Carnival World Buffet is one of the most popular
buffets in Las Vegas due to its extensive selections, its high
quality food and the entertainment provided by the live-action
cooking stations. During 1995, the Carnival World Buffet served
an average of approximately 7,500 people per day. In addition to
its emphasis on food and beverage, the Rio also has an aggressive
marketing program which encompasses frequent radio, television
and newspaper advertising, a variety of promotions directed at
the local customer and other programs such as check cashing
promotions.

     To attract visitors and fill the Rio's hotel rooms, the
Company markets primarily to three segments of the tourist
market: independent travel, wholesale and special casino
customers. The

                                 5

<PAGE>


independent travel segment consists of those travelers not
affiliated with groups who make their reservations directly with
the Rio or through independent travel agents. To attract the
independent traveler, the Rio periodically utilizes print media,
radio and direct mail to advertise in Southern California,
Phoenix and other regional travel markets. In addition, the
Company's sales force frequently attends trade shows in order to
establish relationships with and promote the Rio to travel agents
nationwide. The wholesale segment comprises those patrons
participating in travel packages offered by air tour operators.
To capture this segment of the market, the Rio has developed
specialized marketing programs for, and cultivated relationships
with, these operators. Finally, special casino customers are
those frequent gaming customers who are in regular communication
with Rio casino marketing personnel. The Rio utilizes a variety
of promotions and special events and other amenities in marketing
to this segment.

RIO LOCATION

     The Rio is strategically located to take advantage of the
dynamic residential and commercial growth of the western portion
of metropolitan Las Vegas, while offering proximity and easy
access to the "Old Four Corners" (Flamingo Road and the Strip)
and the "New Four Corners" (Tropicana Avenue and the Strip) areas
of the Las Vegas Strip.

THE RIO

     Since 1992, the Company has consistently expanded the Rio
under its master plan. Upon the completion of the Phase V
Expansion, the Rio will have approximately 2,550 suites, 2,600
slot machines and 92 table games.

<TABLE>
<CAPTION>
                                                       APPROXIMATE
                                                           TOTALS
                                                            AFTER
                       AS OF AND FOR THE YEAR ENDED      COMPLETION
                               DECEMBER 31,                  OF
                     1995     1994      1993     1992      PHASE V

 <S>                 <C>      <C>      <C>       <C>         <C>
 Casino square
   footage           89,000   89,000   79,000    54,000      120,000
 Slot machines        2,098    2,200    1,950     1,450        2,600
 Table games             73       53       44        31           92
 Hotel suites         1,551      861      861       424        2,550
 Average daily                                                      
  hotel occupancy      94.5%    95.9%    96.8%     96.5%           --
 Average daily
  room rate          $72.18   $63.80   $62.60    $64.09           --
 Restaurant seats     2,540    2,440    1,843     1,209        3,840

</TABLE>

     GAMING.  The Rio has 89,000 square feet of casino space. The
casino currently has approximately 2,000 slot machines; 76 table
games, including "21," craps, roulette, pai gow poker, Caribbean
stud poker and mini-baccarat; other casino games such as keno and
poker; and a race and sports book.

     Gaming operations at the Rio are continually being monitored
and modified to respond to both changing market conditions and
customer demand in an effort to attract new customers while
retaining its existing customer base. New and innovative slot and
table games have been introduced based on

                                6

<PAGE>
      
customer feedback and demand from both local customers and Las
Vegas visitors. Management has introduced such games as Rio
Rita's(TM) Royals, Rio Rita's(TM) Bonus Poker, Sneaky Queens(TM),
Mambo Bucks(TM) and Rio Rita's(TM) Paycheck Poker Wheel.
Management devotes substantial time and attention to the type,
location and player activity of all gaming devices.

     HOTEL.  The Rio's 21-story hotel towers contain a total of
1,551 suites, comprised of 1,504 standard Rio suites, 16 "super"
suites, 18 "cariocas" suites, 6 two-story penthouse suites, and
7 executive suites that combine a conference room and an
adjoining suite. The Company has progressively added new hotel
suites since 1993 to meet its consistently strong demand. Despite
such expansion, the Rio has maintained average occupancy rates of
95.9% and 94.5% for 1994 and 1995, respectively.  During 1994 and
1995, management believes that approximately two potential room
night bookings were turned away for each room night booking
accepted.  The Phase V Expansion will add another approximately
1,000 suites in the spring of 1997.

     The standard Rio suite measures approximately 600 square
feet, compared to approximately 400 square feet for the typical
Las Vegas hotel room. The Brazilian Carnival and rain forest
theme is carried throughout the guest suites in wall coverings,
art work and other designer accents. Suite amenities include
carved wood finishes, cut glass, polished granite surfaces,
marble tile in the bath areas, room safes and refrigerators.

     RESTAURANTS.  While important to attracting Las Vegas
visitor gaming customers, the high quality, value and variety of
food services are critical to consistently attracting the local
resident gaming customer to the Rio. To provide such variety,
seven bars and eight restaurants are located in the Rio's main
floor area. The Rio currently serves an average of approximately
13,000 meals per day, including banquets and room service. The
following table sets forth, for each restaurant, the type of
service provided and the current seating capacity:

<TABLE>
<CAPTION>
                                                            
                                                         NUMBER
                                    TYPE                   OF
                                                          SEATS

 <S>                <C>                                    <C>
 All American Bar   Steaks, ribs, chicken and seafood        202
 & Grille

 Antonio's          Italian fine-dining                      100
 
 Beach Cafe         24-hour full menu coffee shop            318
                    featuring American and Chinese
                    cuisine
 
 Buzios             Seafood and oyster bar                   160
 
 Carnival World     Buffet with live action cooking        1,040
 Buffet             featuring Brazilian, Chinese,
                    Italian, Mexican, Japanese, Western
                    BBQ and traditional buffet


                                7

 <PAGE>

 Toscano's Deli &   Deli items, pizza and pasta, ice         104
 Market             cream and gelato, and a large
                    selection of bakery products
 
 Copacabana         Copacabana Dinner Show and Club Rio      430
 Showroom           nightclub
 
 Fiore Rotisserie   Fine-dining featuring rotisserie-        186
 & Grille           grilled seafood, beef and poultry
                                                    
                                                    Total  2,540

</TABLE>

     ENTERTAINMENT AND OTHER ATTRACTIONS.   The Rio's Copacabana
Showroom is a unique, circular 430-seat video, entertainment and
restaurant complex which features two 12-foot by 90-foot video
screens, an exhibition cooking area, multiple tiers of dining
room seating and a stage. The Copacabana Showroom features the
Copacabana Dinner Show, a musical review designed around the
Rio's theme. After the dinner show the Copacabana Showroom is
converted into Club Rio, a late-night dance club. The showroom is
also used for casino-hosted events, concerts, viewing of sporting
events on the large video screens, and corporate meetings that
capitalize on the unique audio visual qualities of the room.

     The Ipanema Lounge and Mambo's Lounge each offer live
entertainment in separate casino cocktail settings. The Rio also
houses a gift shop, a Rio logo shop, a spa, a hair and beauty
salon, and an exercise room, as well as approximately 13,250
square feet of public meeting and banquet room facilities.

     The Rio's pool/outdoor entertainment area is approximately
59,000 square feet and includes a landscaped sand beach, an 11-
foot waterfall, two swimming pools, a multi-level spa, and a
terrace bar and food service facility. The Company hosts beach
parties, volleyball games, outdoor concerts with name performers
and other special events, including professional sporting events.

EXPANSION STRATEGY

     RIO MASTER PLAN.  The Rio's conceptual master plan was
originally designed to accommodate multiple expansions without
significantly interrupting normal business operations. This
design included construction of a reinforced foundation for the
hotel tower and a elevator core to support and facilitate
additional room construction. The Company has also assembled
ample acreage to allow future expansions. Starting from its
original 30 acres, the Company acquired additional acreage in
1989 and 1991, bringing the current Rio site to 45 acres,
exclusive of the additional 22 acres currently under acquisition
as described elsewhere herein.

     Management believes that a high quality, well-maintained
property offering innovative entertainment is integral to success
in the highly competitive Las Vegas gaming market. This belief
has driven the Company's master plan development strategy. The
Company has added substantial new facilities at the Rio every
year since 1992.

                                 8

<PAGE>

<TABLE>
<CAPTION>
                                             START        
                                             DATE    OPENING

   <S>                                       <C>       <C>
   Initial Construction                      12/88      1/90
                                                          
   Casino (10,000 sq. ft.)/Buffet
   Expansion                                 7/92      12/92
                                                          
   Phase II Expansion                                     
     Buzios Restaurant                       1/93       5/93
     Meeting Rooms                           1/93       8/93
     437-Suite Tower                         1/93       9/93
                                                          
   Eastside Expansion                                     
     Two-Story Parking Garage                7/93      10/93
     Casino Space (25,000 sq. ft.)           7/93      12/93
     Copacabana Showroom                     7/93       2/94
     Fiore Restaurant                        7/93       4/94
     Expanded Pool Area                      7/93       4/94
                                                          
   Phase III Expansion                                    
     Three-Story Parking Garage              5/94       8/94
     Casino Space (10,000 sq. ft.)           5/94      11/94
     Buffet Expansion                        5/94      11/94
     549-Suite Tower                         5/94       2/95
                                                          
   Phase IV Expansion                                     
     141-Suite Addition                      4/95      12/95
     Buzios Expansion                        4/95      12/95
     Meeting Rooms Expansion                 4/95      11/95
     Health Club and Salon                   4/95      12/95

</TABLE>

     To date, the Company has invested in excess of $250 million
in the development, expansion and renovation of the Rio. The
Phase V Expansion will continue the Rio's commitment to continued
development and provide new, innovative entertainment
attractions.

     ADDITIONAL GAMING OPPORTUNITIES.   The Company has also
entered into commitments to acquire approximately 22 acres of
land adjacent to the Rio site, bringing the total Rio acreage to
approximately 67 acres. The entire Rio site is now being master-
planned for the development of another hotel-casino, the size and
timing of which has not yet been determined.

     As the third step in its strategic plan to provide further
growth for the Company, in 1995 the Company purchased the
approximately 64 acre Old Vegas Site southeast of Las Vegas in
Henderson, Nevada.  The Old Vegas Site, already zoned for a hotel-
casino, is situated where the Boulder Highway enters the Las
Vegas valley from Phoenix and Laughlin along U.S. Highway 93-95.
The timing and scale of the proposed development has not yet been
determined. Moreover, the Company may pursue additional
opportunities that management believes to be in the best
interests of the Company.

                                9

<PAGE>

COMPETITION

     The gaming industry includes land-based casinos, dockside
casinos, riverboat casinos, casinos located on Native American
land and other forms of legalized gaming. There is intense
competition among companies in the gaming industry, some of which
have significantly greater resources than the Company.

     The Rio faces competition from all other casinos and hotels
in the Las Vegas area, including competitors located on the Las
Vegas Strip, on the Boulder Highway and in downtown Las Vegas.
Such competition includes a number of hotel-casinos targeted
primarily toward local residents, as well as numerous non-hotel
gaming facilities targeted toward local residents. In recent
months, several of the Company's direct competitors have opened
new hotel-casinos or have commenced or completed major expansion
projects, and other expansions are in progress or are planned. As
of December 31, 1995, there were 37 major gaming properties
located on or near the Las Vegas Strip, 14 located in the
downtown area, 4 located on the Boulder Highway and 11 located in
other areas in or near Las Vegas. According to the Las Vegas
Convention and Visitors Authority, the Las Vegas hotel-motel room
inventory was 90,046 as of December 31, 1995.  Seven new hotel-
casinos and 7 hotel-casino expansions are under construction or
have been announced, which will add approximately 19,000 rooms to
the Las Vegas area over approximately the next two years.  Four
of the new hotel-casinos are major resorts with a theme and an
attraction which are expected to draw significant numbers of
visitors.  Major expansions or enhancements of existing
properties or the construction of new properties by competitors,
could have a material adverse effect on the Company's business.

     To a lesser extent, the Rio competes with hotel-casinos
located in the Mesquite, Laughlin and Reno-Lake Tahoe areas of
Nevada and in Atlantic City, New Jersey. The Company also
competes with state-sponsored lotteries, on- and off-track
wagering, card parlors, riverboat and Native American gaming
ventures and other forms of legalized gaming in the United
States, as well as with gaming on cruise ships and international
gaming operations. In addition, many states have legalized, and
additional other states are currently considering legalizing,
casino gaming within those states. The Company believes that the
growth in the legalization of gaming is fueled by a combination
of increasing popularity and acceptability of gaming activities
and the desire and need for states and local communities to
generate revenues without increasing general taxation. The
Company believes that the legalization of unlimited land-based
casino gaming in or near any major metropolitan area, such as
Chicago or Los Angeles, could have a material adverse effect on
its current hotel-casino business.  According to the Attorney
General of California, as of January 1996, there were
approximately 9,000 slot machines illegally located in
approximately 30 casinos on Native American land throughout
California, including four casinos in the Palm Springs area.  In
November 1995, a proposed initiative for the approval of gaming
on Native American land in California was submitted to the
California Attorney General's office but is facing opposition
from certain government, law enforcement and religious leaders.
The development of casinos, lotteries and other forms of gaming
in other states, particularly in areas close to Nevada, such as
California, could adversely affect the Company's operations.

     As its principal methods of competition, the Company
utilizes what management believes  to be its unique all-suite
concept based upon a Brazilian Carnival and rain forest theme,
diverse  high quality dining, friendly service and ample parking,
which management believes provide an attractive alternative

                                10

<PAGE>
      
to the closest source of the Company's competition, the Las Vegas
Strip, and a fun and comfortable environment in which to enjoy
gaming, dining and entertainment.

REGULATION AND LICENSING

     The ownership and operation of casino gaming facilities in
Nevada are subject to: (i) the Nevada Gaming Control Act and the
regulations promulgated thereunder (collectively, "Nevada Act");
and (ii) various local regulations. The Company's gaming
operations are subject to the licensing and regulatory control of
the Nevada Commission, the Nevada State Gaming Control Board (the
"Nevada Board"), and the Clark County Liquor and Gaming Licensing
Board (the "Clark County Board"). The Nevada Commission, the
Nevada Board, and the Clark County Board are collectively
referred to as the "Nevada Gaming Authorities."

     The laws, regulations and supervisory procedures of the
Nevada Gaming Authorities are based upon declarations of public
policy which are concerned with, among other things: (i) the
prevention of unsavory or unsuitable persons from having a direct
or indirect involvement with gaming at any time or in any
capacity; (ii) the establishment and maintenance of responsible
accounting practices and procedures; (iii) the maintenance of
effective controls over the financial practices of licensees,
including the establishment of minimum procedures for internal
fiscal affairs and the safeguarding of assets and revenues,
providing reliable record keeping and requiring the filing of
periodic reports with the Nevada Gaming Authorities; (iv) the
prevention of cheating and fraudulent practices; and (v)
providing a source of state and local revenues through taxation
and licensing fees. Changes in such laws, regulations and
procedures could have an adverse effect on the Company's gaming
operations.

     The Company, which operates the casino, is required to be
licensed by the Nevada Gaming Authorities. The gaming license
requires the periodic payment of fees and taxes and is not
transferable. The Company is registered by the Nevada Commission
as a publicly traded corporation ("Registered Corporation") and
as such, it is required periodically to submit detailed financial
and operating reports to the Nevada Commission and furnish any
other information which the Nevada Commission may require. The
Company has obtained from the Nevada Gaming Authorities the
various registrations, approvals, permits and licenses required
in order to engage in gaming activities in Nevada.

     The Nevada Gaming Authorities may investigate any individual
who has a material relationship to, or material involvement with,
the Company in order to determine whether such individual is
suitable or should be licensed as a business associate of a
gaming licensee. Officers, directors and certain key employees of
the Company must file applications with the Nevada Gaming
Authorities and may be required to be licensed or found suitable
by the Nevada Gaming  Authorities. Officers, directors and key
employees of the Company who are actively and directly involved
in gaming activities of the Company may be required to be
licensed or found suitable by the Nevada Gaming Authorities. The
Nevada Gaming Authorities may deny an application for licensing
for any cause which they deem reasonable. A finding of
suitability is comparable to licensing, and both require
submission of detailed personal and financial information
followed by a thorough investigation. The applicant for licensing
or a finding of suitability must pay all the costs  of the
investigation. Changes in licensed positions must be reported to
the Nevada Gaming Authorities and in addition to their authority
to deny an application for a finding of suitability or licensure,
the Nevada Gaming Authorities have jurisdiction to disapprove a
change in a corporate position.

                                11

<PAGE>
      
     If the Nevada Gaming Authorities were to find an officer,
director or key employee unsuitable for licensing or unsuitable
to continue having a relationship with the Company, the Company
would have to sever all relationships with such person. In
addition, the Nevada Commission may require the Company to
terminate the employment of any person who refuses to file
appropriate applications. Determinations of suitability or of
questions pertaining to licensing are not subject to judicial
review in Nevada.

     The Company is required to submit detailed financial and
operating reports to the Nevada Commission. Substantially all
material loans, leases, sales of securities and similar financing
transactions by the Company must be reported to, or approved by,
the Nevada Commission.

     If it were determined that the Nevada Act was violated by
the Company, the gaming licenses it holds could be limited,
conditioned, suspended or revoked, subject to compliance with
certain statutory and regulatory procedures. In addition, the
Company and the persons involved could be subject to substantial
fines for each separate violation of the Nevada Act at the
discretion of the Nevada Commission. Further, a supervisor could
be appointed by the Nevada Commission to operate the Company's
gaming properties and, under certain circumstances, earnings
generated during the supervisor's appointment (except for the
reasonable rental value of the Company's gaming properties) could
be forfeited to the State of Nevada. Limitation, conditioning or
suspension of any gaming license or the appointment of a
supervisor could (and revocation of any gaming license would)
materially adversely affect the Company's gaming operations.

     Any beneficial holder of the Company's voting securities,
regardless of the number of shares owned, may be required to file
an application, be investigated, and have such holder's
suitability as a beneficial holder of the Company's voting
securities determined, if the Nevada Commission has reason to
believe that such ownership would otherwise be inconsistent with
the declared policies of the State of Nevada. The applicant must
pay all costs of investigation incurred by the Nevada Gaming
Authorities in conducting any such investigation.

     The Nevada Act requires any person who acquires more than 5%
of the Company's voting securities to report the acquisition to
the Nevada Commission. The Nevada Act requires that beneficial
owners of more than 10% of the Company's voting securities apply
to the Nevada Commission for a finding of suitability within 30
days after the Chairman of the Nevada Board mails the written
notice requiring such filing. Under certain circumstances, an
"institutional investor," as defined in the Nevada Act, which
acquires more than 10%, but not more than 15%, of the Company's
voting securities may apply to the Nevada Commission for a waiver
of such finding of suitability if such institutional investor
holds the voting securities for investment purposes only. An
institutional investor shall not be deemed to hold voting
securities for investment purposes unless the voting securities
were acquired and are held in the ordinary course of business as
an institutional investor and not for the purpose of causing,
directly or indirectly, the election of a majority of the members
of the board of directors of the Company, any change in the
Company's corporate charter, bylaws, management, policies or
operations of the Company, or any of its gaming affiliates, or
any other action which the Nevada Commission finds to be
inconsistent with holding the Company's voting securities for
investment purposes only. Activities which are not deemed to be
inconsistent with holding voting securities for investment
purposes only include: (i) voting on all matters voted on by
stockholders; (ii) making financial and other inquiries of
management of the type normally made by securities analysts for
informational

                                12

<PAGE>
      
purposes and not to cause a change in its management, policies or
operations; and (iii) such other activities as the Nevada
Commission may determine to be consistent with such investment
intent. If the beneficial holder of voting securities who must be
found suitable is a corporation, partnership or trust, it must
submit detailed business and financial information including a
list of beneficial owners. The  applicant is required to pay all
costs of investigation.

     Any person who fails or refuses to apply for a finding of
suitability or a license within 30 days after being ordered to do
so by the Nevada Commission or the Chairman of the Nevada Board,
may be found unsuitable. The same restrictions apply to a record
owner if the record owner, after request, fails to identify the
beneficial owner. Any stockholder found unsuitable and who holds,
directly or indirectly, any beneficial ownership of the common
stock of a Registered Corporation beyond such period of time as
may be prescribed by the Nevada Commission may be guilty of a
criminal offense. The Company is subject to disciplinary action
if, after it receives notice that a person is unsuitable to be a
stockholder or to have any other relationship with the Company,
the Company (i) pays that person any dividend or interest upon
voting securities of the Company, (ii) allows that person to
exercise, directly or indirectly, any voting right conferred
through securities held by that person, (iii) pays remuneration
in any form to that person for services rendered or otherwise, or
(iv) fails to pursue all lawful efforts to require such
unsuitable person to relinquish his voting securities for cash at
fair market value.

     The Nevada Commission may, in its discretion, require the
holder of any debt security of a Registered Corporation to file
applications, be investigated and be found suitable to own the
debt security of a Registered Corporation. If the Nevada
Commission determines that a person is unsuitable to own such
security, then pursuant to the Nevada Act, the Registered
Corporation can be sanctioned, including the loss of its
approvals, if without the prior approval of the Nevada
Commission, it: (i) pays to the unsuitable person any dividend,
interest, or any distribution whatsoever; (ii) recognizes any
voting right by such unsuitable person in connection with such
securities; (iii) pays the unsuitable person remuneration in any
form; or (iv) makes any payment to the unsuitable person by way
of principal, redemption, conversion, exchange, liquidation or
similar transaction.

     The Company is required to maintain a current stock ledger
in Nevada which may be examined by the Nevada Gaming Authorities
at any time. If any securities are held in trust by an agent or
by a nominee, the record holder may be required to disclose the
identity of the beneficial owner to the Nevada Gaming
Authorities. A failure to make such disclosure may be grounds for
finding the record holder unsuitable. The Company is also
required to render maximum assistance  in determining the
identity of the beneficial owner. The Nevada Commission has the
power to require the Company's stock certificates to bear a
legend indicating that the securities are subject to the Nevada
Act.

     The Company may not make a public offering of its securities
without the prior approval of the Nevada Commission if the
securities or proceeds therefrom are intended to be used to
construct, acquire or finance gaming facilities in Nevada, or to
retire or extend obligations incurred for such purposes. On
July 27, 1995, the Nevada Commission granted the Company prior
approval to make public offerings for a period of one year,
subject to certain conditions ("Shelf Approval"). However, the
Shelf Approval may be rescinded for good cause without prior
notice upon the issuance of an interlocutory stop order by the
Chairman of the Nevada Board. Such approval does not constitute a
finding, recommendation or approval by the Nevada Commission or
the Nevada Board as to the

                                13

<PAGE>
      
accuracy or adequacy of the prospectus or the investment merits
of the securities. Any representation to the contrary is
unlawful.

     Changes in control of the Company through merger,
consolidation, stock or asset acquisitions, management or
consulting agreements, or any act or conduct by a person whereby
such person obtains control, may not occur without the prior
approval of the Nevada Commission. Entities seeking to acquire
control of a Registered Corporation must satisfy the Nevada Board
and Nevada Commission in a variety of stringent standards prior
to assuming control of such Registered Corporation. The Nevada
Commission may also require controlling stockholders, officers,
directors and other persons having a material relationship or
involvement with the entity proposing to acquire control, to be
investigated and licensed as part of the approval process
relating to the transaction.

     The Nevada legislature has declared that some corporate
acquisitions opposed by management, repurchases of voting
securities and corporate defense tactics affecting Nevada gaming
licensees, and Registered Corporations that are affiliated with
those operations, may be injurious to stable and productive
corporate gaming. The Nevada Commission has established a
regulatory scheme to ameliorate the potentially adverse effects
of these business practices upon Nevada's gaming industry and to
further Nevada's policy to: (i) assure the financial stability of
corporate gaming operators and their affiliates; (ii) preserve
the beneficial aspects of conducting business in the corporate
form; and (iii) promote a neutral environment for the orderly
governance of corporate affairs. Approvals are, in certain
circumstances, required from the Nevada Commission before the
Company can make exceptional repurchases of voting securities
above the current market price thereof and before a corporate
acquisition opposed by management can be consummated. The Nevada
Act also requires prior approval of a plan of recapitalization
proposed by the Company's Board of Directors in response to a
tender offer made directly to the Registered Corporation's
stockholders for the purposes of acquiring control of the
Registered Corporation.

     Licensee fees and taxes, computed in various ways depending
on the type of gaming or activity involved, are payable to the
State of Nevada and to the counties and cities in which the
Nevada licensee's respective operations are conducted. Depending
upon the particular fee or tax involved, these fees and taxes are
payable either monthly, quarterly or annually and are based upon
either (i) a percentage of the gross revenues received, (ii) the
number of gaming devices operated or (iii) the number of table
games operated. A casino entertainment tax is also paid by casino
operations where entertainment is furnished in connection with
the selling of food or refreshments. Nevada licensees that hold a
license as an operator of a slot route, or a manufacturer's or
distributor's license, also pay certain fees and taxes to the
State of Nevada.

     Any person who is licensed, required to be licensed,
registered, required to be registered, or is under common control
with such persons (collectively, "Licensees"), and who proposes
to become involved in a gaming venture outside of Nevada is
required to deposit with the Nevada Board, and thereafter
maintain, a revolving fund in the amount of $10,000 to pay the
expenses of investigation of the Nevada Board of their
participation in such foreign gaming. The revolving fund is
subject to increase or decrease at the discretion of the Nevada
Commission. Thereafter, Licensees are required to comply with
certain reporting requirements imposed by the Nevada Act.
Licensees are also subject to disciplinary action by the Nevada
Commission if they knowingly violate any laws of the foreign
jurisdiction pertaining to the foreign gaming operation, fail to
conduct the foreign gaming operation in

                                14

<PAGE>

accordance with the standards of honesty and integrity required
of Nevada gaming operations, engage in activities that are
harmful to the State of Nevada or its ability to collect gaming
taxes and fees, or employ a person in the foreign operation who
has been denied a license or finding of suitability in Nevada on
the ground of personal unsuitability.

EMPLOYEES

     As of  December 31, 1995, the Company employed approximately
3,074 employees.  None of the Company's employees is covered by
collective bargaining agreements. The Company believes that its
relationship with its employees is good.

ITEM 2.  PROPERTIES

     The Company owns the 45-acre site in Las Vegas on which the
Rio is located. The Rio site is subject to a deed of trust
securing the Company's $175 million revolving credit facility
(the "Rio Bank Loan"), of which $125 million and $10 million were
outstanding at December 31, 1994 and 1995, respectively. The
Company is in the process of accumulating 22 acres of land
adjacent to the current Rio site. In 1995 the Company
purchased approximately five of such acres of improved land (the
"Warehouse Site"). The purchase of the remaining approximately 17
additional acres of land is currently in escrow, which upon
closing will bring the total Rio acreage to approximately 67
acres. The entire Rio site, including the Warehouse Site and the
additional property the Company is acquiring, is now being master-
planned for the development of another hotel-casino, the size and
timing of which has not yet been determined. In 1995 the
Company purchased the approximately 64 acre Old Vegas Site on
Boulder Highway southeast of Las Vegas. The Company is presently
considering various development options for the property.

ITEM 3.  LEGAL PROCEEDINGS

     William H. Ahern v. Caesars World, Inc., et al., Case No. 94-
532-Civ-Orl-22, instituted on May 10, 1994 (the "Ahern
Complaint") and William Poulos v. Caesars World, Inc., et al.,
Case No. 94-478-Civ-Orl-22, instituted on April 26, 1994 (the
"Poulos Complaint") (collectively, the Ahern Complaint and the
Poulos Complaint are referred to as the "Complaints").  Two
individuals, each purportedly representing a class, filed the
Complaints in the United States District Court, Middle District
of Florida, against 41 manufacturers, distributors and casino
operators of video poker and electronic slot machines, including
the Company. The Complaints allege that the defendants have
engaged in a course of conduct intended to induce persons to play
such games based on a false belief concerning how the gaming
machines operate, as well as the extent to which there is an
opportunity to win on a given play. The Complaints allege
violations of the Racketeer Influenced and Corrupt Organizations
Act (the "RICO Act"), as well as claims of common law fraud,
unjust enrichment and negligent misrepresentation, and seek
damages in excess of $1 billion without any substantiation of
that amount.  The Complaints were consolidated and transferred to
the United States District Court for the District of Nevada.
Management believes that the Complaints are without merit and
intends vigorously to defend the allegations.

                                15

<PAGE>
      
     Larry Schreier v. Caesars World, Inc., et al., Case No. 95-
923-LDG (RJJ), instituted on September 26, 1995, in the United
States District Court for the District of Nevada, Southern
District.  An individual, purportedly representing a class, filed
a complaint against four manufacturers, three distributors and 38
casino operators, including the Company, that manufacture,
distribute or offer for play video poker and electronic slot
machines.  The individual allegedly intends to seek class
certification of the interests he claims to represent.  The
complaint alleges that the defendants have engaged in a course of
conduct intended to induce persons to play such games based on a
false belief concerning how the gaming machines operate, as well
as the extent to which there is an opportunity to win on a given
play.  The complaint alleges violations of the RICO Act, as well
as claims of common law fraud, unjust enrichment and negligent
misrepresentation, and seeks damages in excess of $1 billion.
The complaint is similar to the Poulos Complaint and the Ahern
Complaint.  The Company filed a motion to dismiss the complaint.
The court has not yet ruled on the motion.  Plaintiff's attempts
to consolidate this action with the Ahern Complaint and Poulos
Complaint were not successful.  Management believes that the
complaint is without merit and intends vigorously to defend the
allegations.

     Hyland, et al. v. Griffin Investigations, et al., Case No.
95-CV-2236 (JEI) instituted on May 5, 1995 in the United States
District Court for the District of New Jersey (Camden Division).
The Company, together with 76 other casino operators and others,
is named as a defendant in the action.  The action, purportedly
brought on behalf of "card counters," alleges that the casino
operators exclude "card counters" from play and share information
about "card counters." The action is based on alleged violations
of federal antitrust law, the Fair Credit Reporting Act, and
various state consumer protection laws.  The amount of damages
sought by the plaintiffs in the action is unspecified.  The
Company has made a motion to dismiss the complaint.  The court
has not yet ruled on the motion.  Management believes that the
complaint is without merit and the Company intends vigorously to
defend the allegations.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     Not applicable.

                                16

<PAGE>
      
PART II

ITEM 5.  MARKET   FOR  REGISTRANT'S  COMMON  EQUITY  AND  RELATED
         STOCKHOLDER MATTERS.

     (a)  Price Range of Common Stock

     The Company's common stock, $.01 par value ("Common Stock"),
began trading on the New York Stock Exchange (the "NYSE") under
the symbol "RHC" on January 11, 1996.  Prior to this date, the
Company's Common Stock was traded on the Nasdaq National Market
under the symbol "RIOH".  The following table sets forth the high
and low closing sale prices of the Company's Common Stock, as
reported by the NYSE and the Nasdaq National Market, during the
periods indicated.

<TABLE>
<CAPTION>
                                               High    Low
    <S>   <C>                               <C>         <C>
    1994                                                     
          First Quarter                     $18 1/8     $14 1/4
          Second Quarter                     16 1/2      12 5/8
          Third Quarter                      14 3/8      12 3/8
          Fourth Quarter                     14 1/8      11 11/16
    1995                                                         
          First Quarter                      14          11 1/4
          Second Quarter                     16 5/8      13 1/4
          Third Quarter                      14 3/4      12 1/2
          Fourth Quarter                     13 5/8      11 5/8
    1996                                                     
          First Quarter (through             14 3/8      11 7/8
            February 29, 1996)

</TABLE>

     The last reported sale price of the Common Stock on the NYSE
on February 29, 1996 was $13.75 per share. There were
approximately 1,607 holders of record of the Company's Common
Stock as of February 29, 1996.

     (b)  Dividend Policy

     The Company has never declared or paid cash dividends on its
Common Stock. The Company presently intends to retain earnings to
finance the operation and expansion of its business and does not
anticipate declaring cash dividends in the foreseeable future.
Under the terms of the covenants in the Rio Bank Loan (as defined
below), the Company's wholly owned subsidiary, Rio Properties,
Inc. ("Rio Properties") cannot pay dividends to the Company
without the consent of the lenders.  Under the terms of the
Indenture (as defined below), governing the Subordinated Notes
(as defined below), the payout of dividends and other
distributions is subject to specified restrictions.

                                17

<PAGE>
      
<TABLE>
<CAPTION>

Item 6.  Selected Financial Data (1)

                                                  Year Ended December 31,

                                                 1995            1994                1993

<S>                                          <C>              <C>             <C>

Revenues from Continuing Operations          $192,537,954     $146,299,304     $109,981,585

Income from Continuing Operations            $ 18,745,479     $ 15,966,409     $ 11,679,991

Loss from Discontinued Operations                   - - -            - - -           - - -

Minority Interest in Earnings                       - - -            - - -     $     - - -

Extraordinary Items                                 - - -     $      - - -     $   (253,711)

Cumulative Effect of Accounting Change              - - -     $      - - -         (776,888)

Net Income                                   $ 18,745,479     $ 15,966,409     $ 10,649,392

Primary Earnings Per Common Share:

   Income from Continuing Operations         $       0.87     $       0.74     $       0.60

   Loss from Discontinued Operations                - - -            - - -            - - -

   Extraordinary Items                              - - -     $      - - -     $      (0.01)

   Cumulative Effect of Accounting Change           - - -     $      - - -            (0.04)

   Net Income                                $       0.87     $       0.74     $       0.55

Total Assets                                 $308,791,594     $301,165,272     $218,050,376

Long-Term Debt, net of current               $110,176,765     $110,146,869     $ 56,875,753

Total Stockholders' Equity                   $162,887,900     $147,839,167     $129,838,481

Cash Dividends Declared Per Common Share            - - -            - - -            - - -

</TABLE>

<TABLE>
<CAPTION>

                                                Year ended December 31,

                                                  1992            1991

<S>                                        <C>                <C>
Revenues from Continuing Operations        $ 82,475,164       $ 65,784,480

Income from Continuing Operations          $  5,756,628       $     381,181

Loss from Discontinued Operations          $      - - -       $    (395,102)

Minority Interest in Earnings              $   (242,240)      $     (33,164)

Extraordinary Items                        $    793,511             166,168

Cumulative Effect of Accounting Change            - - -               - - -

Net Income                                  $  6,307,899       $    119,083

Primary Earnings Per Common Share:

   Income from Continuing Operations        $       0.37       $       0.03

   Loss from Discontinued Operations        $      - - -       $      (0.03)

   Extraordinary Items                      $       0.05               0.01

   Cumulative Effect of Accounting Change          - - -              - - -

   Net Income                               $       0.42       $       0.01

Total Assets                                $149,518,427       $112,267,283

Long-Term Debt, net of current              $   50,906,000     $ 53,494,595

Total Stockholders' Equity                  $   86,872,151     $ 47,731,447

Cash Dividends Declared Per Common Share             - - -           - - -

(1)  The Company divested its real estate operations in December 1991 and results from these 
     operations are stated and shown above as discontinued operations.

</TABLE>

                                         18
<PAGE>

<TABLE>
<CAPTION>

                          RIO HOTEL & CASINO, INC. AND SUBSIDIARIES
                    SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

                                        First       Second      Third
(In thousands except per share data)    Quarter     Quarter     Quarter

<S>                                     <C>         <C>         <C>
1995 (a)

 Revenues                               $  43,828   $  47,956   $  49,765
 Operating profit                           8,387       9,351      10,182
 Net income                                 4,512       4,914       4,884

 Net income per common share (b)        $    0.21   $    0.23   $    0.23


1994 (a)

 Revenues                               $  34,049   $  36,168   $  37,371
 Operating profit                           6,622       6,923       6,746
 Net income                                 3,979       4,780       4,022

 Net income per common share (b)        $    0.17   $    0.22   $    0.19

</TABLE>

<TABLE>
<CAPTION>
                                        Fourth
(In thousands except per share data)    Quarter        Total

<S>                                     <C>         <C>
1995 (a)

 Revenues                               $  50,989   $ 192,538
 Operating profit                           9,218      37,138
 Net income                                 4,435      18,745

 Net income per common share (b)        $    0.21   $    0.87


1994 (a)

 Revenues                               $  38,711   $ 146,299
 Operating profit                           5,512      25,803
 Net income                                 3,185      15,966

 Net income per common share (b)        $    0.15   $    0.74



(a)There were no dividends paid in 1995 or 1994

(b)Net income per share calculations for each quarter are based on the weighted 
   average number of common stock and common stock equivalents outstanding during 
   the respective quarters.  Accordingly, the sum of the quarters does not equal 
   the full year income per share for 1995 or 1994.

</TABLE>

                                19
<PAGE>

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS

OVERVIEW

     The Rio's revenues and profits are derived largely from its
gaming activities, although the Company also seeks to maximize
revenues from food and beverage, lodging, entertainment and
retail sales.  The Rio generally views its non-casino related
operations as complementary to its core casino operations.  The
Rio utilizes entertainment primarily as a casino marketing tool.
The Rio expects to maintain a food and beverage pricing structure
designed to maximize casino customer foot traffic.

     The Company's sole business is the operation of the Rio,
which opened in January 1990.  The Rio was originally owned and
operated by a limited partnership (the "Rio Partnership") formed
by the Company in 1988.  Through a series of transactions
involving an exchange of preferred stock for partnership
interests and later a merger of Rio Partnership into Rio
Properties, the Company increased its ownership of the Rio from
34.4% in 1988 to 100% in 1992.  Prior to 1990, the Company's
operations consisted of real estate development and management.
In December 1991, the Company sold all real estate assets and
operations not used or held for the operation or expansion of the
Rio.  In 1995, as part of the Company's three-phased expansion
and development plan, the Company entered into agreements for the
purchase of approximately 22 acres adjacent to the Rio and
approximately 64 acres southeast of Las Vegas, both of which may
be developed into future hotel-casino projects.

     The Rio was designed to permit multiple expansions in
accordance with a conceptual master plan and has received
necessary governmental approvals for the Phase V Expansion.  An
$8 million buffet-casino expansion was completed in December
1992; the $37 million Tower Expansion was completed in September
1993; and the $25 million Eastside Expansion was completed in
April 1994.  In May 1994, the Company commenced its Phase III
Expansion, an expansion which contained a total of 549 additional
suites (365 new suites were placed into service in February 1995
and the remaining suites were placed into service in March 1995),
approximately 10,000 square feet of new casino area that
accommodated approximately 300 additional slot machines (opened
November 1994), an expansion of the Carnival World Buffet by
approximately 50% (opened November 1994), a 527-space, three-
level parking garage (opened August 1994), and associated back-of-
the-house enhancements.  The Phase III Expansion was completed in
phases from August 1994 through March 1995.  In April 1995, the
Company commenced its $20 million Phase IV Expansion.  The
project added 141 suites to the existing 1,410 suites, added
approximately 5,400 square feet of meeting room space, increased
the size of the existing Buzios seafood restaurant to
approximately 160 seats, added a new health club and salon
facility and included a variety of back-of-the-house
improvements.  Completion of the Phase IV Expansion occurred in
stages through the end of 1995.  See "Item l. Business-Expansion
Strategy".

                                 20

<PAGE>
      
YEARS ENDED DECEMBER 31, 1995 AND 1994

     Operating profit for  the Company increased to $37.1 million
for 1995 from $25.8 million for 1994, an increase of $11.3 
million or 44%.  Management believes that the improvement
in operating results was due to the additional 365 new hotel
suites placed into service in February 1995, the additional 184
new hotel suites placed into service in March 1995, the
additional 141 new hotel suites placed into service in December
1995, an average monthly increase from 1994 levels of
approximately 174 slot machines and 19 table games, additional
restaurant capacity and improved operating efficiencies in the
hotel department.

     Net revenues for the Company increased to $192.5 million for
1995 from $146.3 for 1994, an increase of $46.2 million or 32%.
Casino revenues increased to $105.5 million for 1995 from $87.2
million for 1994, an increase of $18.3 million or 21%.  The
increase in casino revenues was due primarily to an increase in
slot machine revenues of $8.5 million or 16% to $63.0 million for
1995 from $54.5 million for 1994 and an increase in table games
revenues of $10.3 million or 40% to $36.1 million for 1995 from
$25.8 million for 1994, resulting from the additional slot
machines and table games discussed above, as well as an increase
in the per unit win of both slots and table games.

     Room revenues increased by $14.5 million or 76% to $33.8
million for 1995 from $19.3 million for 1994.  The increase in
room revenue resulted primarily from the addition of 365 new
hotel suites placed into service in February 1995, 184 new hotel
suites placed into service in March 1995,  and 141 new hotel
suites placed into service in December 1995. The additional 690
suites placed into service in 1995 increased the Rio's total to
1,551 suites compared to 861 suites for 1994.  Demand for the
Rio's suites remained high during 1995 with a 94% average daily
occupancy compared to a 96% average daily occupancy during 1994.
The average number of suites available during 1995 was 1,354
compared to 861 during 1994.  The average daily room rate during
1995 was $72.18 compared to $63.80 during 1994.

     Food and beverage revenues increased to $60.0 million for
1995 from $47.6 million for 1994, an increase of $12.4 million or
26%.  The successful opening in February 1994 of the Copacabana
Showroom, a 430-seat video, entertainment and restaurant complex;
the successful opening in April 1994 of Fiore, a 186-seat fine
dining restaurant; the successful opening in June 1994 of Club
Rio, a late-night dance club; the successful completion in
November 1994 of a 50% expansion of the Carnival World Buffet to
980 seats; and increased beverage sales as a result of increased
gaming customers all contributed to the increase in food and
beverage revenues.

     Other revenues for 1995 were $12.0 million, which included
entertainment admission revenues of $4.1 million, retail sales of
$4.1 million and miscellaneous other operating revenues,
primarily telephone revenues, of $3.8 million.  This represented
an increase in other revenues of $4.9 million, or 68%, compared
to the $7.1 million in other revenues generated during 1994.  The
increase in other revenues resulted primarily from increased
entertainment admission revenues, retail sales and telephone
revenues resulting from increased business levels.

                                 21

<PAGE>
      
     The Company's operating margins were relatively consistent
during 1995 compared to 1994.  Operating profit as a percentage
of net revenues was 19% during 1995 compared to 18% during 1994.
Casino operating profit was relatively constant at 55% during
1995 compared to 56% during 1994.  Food and beverage operating
profit remained relatively constant at 20% during 1995 compared
to 19% during 1994.  Hotel operating profit increased to 69%
during 1995 compared to 66% during 1994 due to efficiencies
resulting from increased customer volume, effective cost controls
and a higher average room rate during 1995 compared to 1994.
Selling, general and administrative expenses were 14% of net
revenues in both 1995 and 1994.

     During 1995, promotional allowances were $18.8 million, or
9% of gross revenues, which represented the retail value of
rooms, food, beverage and other services provided to customers
without charge.  The estimated cost of providing such promotional
allowances was $11.1 million.  This compares to 1994 when
promotional allowances were $14.9 million, or 9% of gross
revenues, and the estimated cost of providing such promotional
allowances was $9.1 million.

     Depreciation and amortization increased by $3.3 million or
31% to $14.2 million for 1995 compared to $10.9 million for 1994.
This increase is attributable to depreciation expense from
various completed expansion projects such as the Company's
Eastside Expansion and the Phase III Expansion.

     Other expenses of the Company increased primarily because of
higher interest expense.  Borrowing levels increased in 1995
compared to 1994 due to funding costs of the various expansion
projects.  Also, in July 1995, in anticipation of the funding
requirements for the Phase  V Expansion, the Company issued
$100 million in 10 5/8% Senior Subordinated Notes.  (See "Item 7.
Liquidity and Capital Resources").  The fixed coupon rate of
10 5/8% was higher than the floating rate that the Company was
paying under the Rio Bank Loan.  Consequently, the issuance of
these notes resulted in an increase in interest expense.
Interest expense for 1995 was reduced by $949,423 because of
interest capitalized on amounts expended on the Phase III
Expansion, the Phase IV Expansion and the Phase V Expansion.
Interest expense for 1994 was reduced by $619,887 because of
interest capitalized on amounts expended on the Eastside
Expansion and the Phase III Expansion.  Other income for 1994 was
a one-time gain of $1.1 million related to the resale of two real
estate parcels previously owned by the Company.  A one-time gain
of $966,510 related to the sale of real estate which was sold by
the Company to a related party in December 1991.  In April 1994,
the real estate was resold to a non-related party.  Pursuant to
the terms of the sales agreement between the Company and the
related party, the Company was entitled to a portion of the
resale proceeds, which equaled $966,510, net of expenses.
Another one-time gain of $173,500 related to the sale of a second
piece of real property owned by the Company until May 1991, when
it was sold to a non-related party.  Pursuant to the terms of the
sales agreement, the Company was entitled to a portion of the
resale proceeds or refinancing amount, which equaled $173,500,
net of expenses.

     Net income for 1995 increased 17% to $18.7 million or $0.87
per share (fully diluted) from $16.0 million or $0.74 per share
(fully diluted) for 1994 as a result of the factors discussed
above.

                                22

<PAGE>

YEARS ENDED DECEMBER 31, 1994 AND 1993

     Operating profit for the Company increased to $25.8 million
for 1994 from $20.2 million for 1993, an increase of $5.6 million
or 27.5%.  Management believes that the improvement in operating
results was due to increased business levels in 1994 as a result
of having an additional  437 hotel suites for nine months of the
year, an addition of approximately 800 slot machines
(approximately 500 slot machines were added in December 1993 and
approximately 300 slot machines were added in November 1994), an
addition of approximately 13 table games and additional
restaurant capacity compared to 1993.

     Net revenues for the Company increased to $146.3 million for
1994 from $110.0 million for 1993, an increase of $36.3 million
or 33%.  Casino revenues increased to $87.2 million for 1994 from
$71.3 million for 1993, an increase of $15.9 million or 22%.  The
increase in casino revenues was due primarily to an increase in
slot machine revenues of $9.3 million or 20% to $54.5 million for
1994, from $45.2 million for 1993, and an increase in table games
revenues of $6.0 million or 30% to $25.8 million for 1994, from
$19.8 million for 1993, resulting from the additional slot
machines and table games discussed above.

     Room revenues increased to $19.3 million for 1994 from
$12.3 million for 1993, an increase of $6.9 million or 56%.  The
increase in room revenues resulted primarily from the addition of
437 suites during the fourth quarter of 1993 (375 new suites were
placed in service in September 1993 and 62 suites were placed in
service in October 1993), bringing the Company's total to 861
suites available during 1994.  Demand for the Rio's suites
remained high during 1994, at a 96% average daily occupancy
compared to a 97% average daily occupancy during 1993.  The
average daily room rate during 1994 was $63.80 compared to $62.60
during 1993.

     Food and beverage revenues increased to $47.6 million for
1994 from $32.6 million for 1993, an increase of $15.1 million or
46%.  The increase was principally due to the successful opening
in February 1994 of a new 430-seat video, entertainment and
restaurant complex, the successful opening in April 1994 of a new
186-seat fine dining restaurant, the successful completion in
November 1994 of a 50% expansion of the Carnival World Buffet to
980 seats, an increase in the number of patrons served in other
Rio restaurants and an increase in the average food check.

     Other revenues for the year ended December 31, 1994 were
$7.1 million, which included entertainment admission revenues of
$1.9 million, retail sales of $2.6 million and miscellaneous
other operating revenues, primarily telephone revenues of
$2.6 million.  This represented an increase in other revenues of
$2.9 million, or 69%, compared to the $4.2 million in other
revenues generated during the twelve months ended December 31,
1993.  The increase of $2.9 million was attributable to increases
of approximately $0.9 million in each of admission revenues,
retail sales, and miscellaneous other revenues.

     The Company's operating margins were relatively consistent
during 1994 compared to 1993.  Operating profit as a percentage
of net revenues was 18% in both 1994 and 1993.  Casino operating
profit was 56% in both 1994 and 1993.  Food and beverage
operating profit improved to

                               23

<PAGE>

19% during 1994 compared to 15% during 1993 as a result of an
increase in volume, price increases and effective cost control
measures.  Hotel operating profit improved to 66% during 1994
compared to 64% during 1993 as a result of a higher average room
rate and effective cost control measures.  Selling, general and
administrative expenses were 14% of net revenues during 1994, of
which $421,367 were expenses related to gaming development.  This
compares favorably to 1993 when selling, general and
administrative expenses were 15% of net revenues, which did not
include any material expenditures related to gaming development.

     During 1994, promotional allowances were $14.9 million, or
9% of gross revenues, which represented the retail value of
rooms, food, beverage and other services provided to customers
without charge.  The estimated cost of providing such promotional
allowances was $9.1 million.  This compares to 1993 when
promotional allowances were $10.4 million, or 9% of gross
revenues, and the estimated cost of providing such promotional
allowances was $6.9 million.

     Depreciation and amortization increased to $10.9 million for
1994 from $7.5 million for 1993, an increase of $3.3 million or
44%.  This increase is attributable to a full year of
depreciation on the Phase II Expansion which was completed in
September 1993, depreciation on the Eastside Expansion which was
completed in phases by April 1994 and depreciation on the Phase
III Expansion projects completed during 1994.

     Other income for 1994 was a one-time gain of $1.1 million
related to the resale of certain real estate previously owned by
the Company.  A one-time gain of $966,510 related to the sale of
real estate which was sold by the Company to a related party in
December 1991.  In April 1994, the real estate was resold to a
non-related party.  Pursuant to the terms of the sales agreement
between the Company and the related party, the Company was
entitled to a portion of the resale proceeds, which equaled
$966,510, net of expenses.  A one-time gain of $173,500 related
to the sale of real estate owned by the Company until May 1991,
when it was sold to a non-related party.  Pursuant to the terms
of the sales agreement, the Company was entitled to a portion of
the resale proceeds or refinancing amount, which equaled
$173,500, net of expenses.

     Income before extraordinary items and cumulative effect of a
change in accounting principle increased 37% to $16.0 million or
$0.74 per share (fully diluted) for 1994, from $11.7 million or
$0.60 per share (fully diluted) for 1993.  The results for 1993
were impacted by the cumulative effect of a change in accounting
principle resulting from the adoption of Financial Accounting
Standards Board Statement No. 109, "Accounting for Income Taxes"
("SFAS 109").  Adoption of SFAS 109 resulted in a one-time, non-
cash charge in the amount of $776,888 or ($0.04) per share (fully
diluted).  The results for 1993 were also adversely affected by
the extraordinary loss on early extinguishment of debt, net of
income tax benefit, of $253,711 or ($0.01) per share (fully
diluted).

     Net income for 1994 increased 50% to $16.0 million or $0.74
per share (fully diluted) from $10.6 million or $0.55 per share
(fully diluted) for 1993 as a result of the factors discussed
above.

                                24

<PAGE>

IMPACT OF INFLATION

     Absent changes in competitive and economic conditions or in
specific prices affecting the industry, the Company believes that
the hotel-casino industry may be able to maintain its real
operating profit margins in periods of general inflation by
increasing minimum wagering limits for its games and increasing
the prices of its hotel rooms, food and beverage and other items,
and by taking action designed to increase the number of patrons.
The industry may be able to maintain growth in gaming revenues by
the tendency of customer gaming budgets to increase with
inflation.  Changes in specific prices (such as fuel and
transportation prices) relative to the general rate of inflation
may have a material effect on the hotel-casino industry.

LIQUIDITY AND CAPITAL RESOURCES

     At December 31, 1995, the Company had working capital of
$5.8 million compared with $50.2 million at December 31, 1994.
Cash and cash equivalents were $20.0 million at December 31, 1995
compared with $76.4 million at December 31, 1994.  At December
31, 1995, the Company had $165.0 million available under its bank
facility while the bank facility was fully utilized at December
31, 1994.  The decrease in both working capital and cash is
primarily due to the use of cash and cash equivalents during 1995
to repay principal under the Rio Bank Loan and the decision of
the Company not to draw down the full amount of the available Rio
Bank Loan at the end of 1995, as well as the use of cash and cash
equivalents to make capital expenditures for the Company's
$75 million Phase III Expansion, the $20 million Phase IV
Expansion, the $185 million Phase V Expansion, the purchase of
land adjacent to the Rio and the purchase of the approximately 64
acre Old Vegas Site, both of which may be developed into future
hotel casino projects.

     During 1995, cash provided by operating activities was
$42.4 million.  Investing activities used $76.1  million of the
Company's cash during 1995.  Approximately $27.2 million of such
expenditures was related to the Phase III Expansion,
approximately $18.1 million was related to the Phase IV Expansion
and approximately $7.9 million was related to the Phase V
Expansion.  During the first quarter of 1995, the Company
acquired an approximately 5-acre site adjacent to the Rio site, on
which a former commercial warehouse is located, at a purchase
price of $3.2 million (net of credit for profit participation
from the seller to which the Company was entitled and net of
rental proceeds during the term of the escrow).  During the
second quarter of 1995, the Company acquired the Old Vegas Site
at a purchase price of $5.7 million (net of credit for profit
participation from the seller to which the Company was entitled).
The Old Vegas Site and additional land acquisitions are part of
the Company's recently announced three phase expansion and
development plan.  During 1995, the Company spent approximately
$11.7 million toward the acquisition of certain real property
adjacent to the Rio.  The balance of cash used in investing
activities was expended on other capital projects.

     During the fourth quarter of 1994, the Board of Directors
authorized the Company to make discretionary repurchases of up to
2 million shares of its Common Stock from time to time in the
open market or otherwise.  During 1995, the Company repurchased
430,500 shares of Common Stock at a total cost of $5.4 million.
The repurchased shares of Common Stock were retired.

                                 25

<PAGE>

     Under the Rio Bank Loan, the Company is subject to annual
capital expenditure limits of $7.5 million plus the amount
available of unused capital expenditures from the prior fiscal
year, but not to exceed $12.5 million annually in any event.
However, the Company received a written waiver to allow the
Company to construct the Phase III Expansion, the Phase IV
Expansion and the Phase V Expansion.  Because of the annual
restrictions on capital expenditures by the Company contained in
the Rio Bank Loan, any other significant new capital improvements
to the Rio will also require the consent of the lenders.

     As of January 1, 1996 the Company's capital commitments
include approximately $2.0 million for the remainder of the Phase
III Expansion, $1.9  million for the Phase IV Expansion,
$177.1 million for the Phase V Expansion and $8.6 million under
commitments for the purchase of real estate.  Based upon cash on
hand, cash available through borrowings under the Rio Bank Loan
and cash from operations, the Company believes that it has
adequate cash available to fund the remaining cost of the Phase
III Expansion, the Phase IV Expansion, the Phase V Expansion and
the real estate purchase commitments.

     In July 1993, the Company obtained a secured reducing
revolving credit facility ("the Rio Bank Loan") in the original
principal amount of $65 million with a syndicate of banks
consisting of Bank of America National Trust Savings and
Association ("B of A"), Bank of America Nevada, Societe Generale,
NBD Bank, N.A., First Security Bank of Idaho, N.A., First
Interstate Bank of Nevada, N.A. and U. S. Bank of Nevada.  As a
result of certain amendments, in December 1994, the Rio Bank Loan
was increased to $125 million and in September 1995, the Rio Bank
Loan was increased to $175 million.  As amended, the Rio Bank
Loan is a secured reducing revolving credit facility to be used
(a) to refinance the pre-amendment Rio Bank Loan, (b) to finance
the Phase V Expansion, (c) to finance acquisition of land
adjacent to the Rio for up to $30 million, (d) for Common Stock
repurchases up to $10 million, and (e) for general corporate
purposes.

     As amended, the Rio Bank Loan matures on June 30, 2001 and
bears interest based upon a "LIBOR Spread" of from 1% to 3%, or a
"Base Rate Spread" of from 0% to 2% based upon a schedule
determined with reference to the "Funded Debt to EBITDA Ratio" of
Rio Properties.  The "LIBOR Spread" is the amount in excess of
the applicable LIBOR rate which is the London interbank offer
rate established in the London interbank market. The "Base Rate
Spread" is the amount in excess of the applicable base rate,
which is the rate per annum equal to the higher of the reference
rate as it is publicly announced from time to time by Bank of
America in San Francisco or 0.50% per annum above the latest
Federal Funds rate.  The Rio Bank Loan also provides for an
unused facility fee ranging from 31.25 basis points (one one-
hundredth of one percent) to 50.0 basis points depending upon the
same Funded Debt to EBITDA ratio schedule utilized for the
interest rate.  The Rio Bank Loan requires monthly payments of
interest and requires scheduled reductions of the maximum amount
available under the Rio Bank Loan commencing with a $10 million
reduction at December 31, 1997, a $7.5 million reduction at the
end of each quarter during 1998 and 1999, a $10.0 million
reduction at the end of each quarter during 2000, a $32.5 million
reduction at March 31, 2001 and maturity at June 30, 2001.

                                  26

<PAGE>

     To reduce the risks from interest rate fluctuations, the
Company has previously entered into interest rate swap agreements
in the amount of $20 million from September 30, 1994 through
December 29, 1995 and $15 million from December 29, 1995 through
June 28, 1996.  In August 1994, the Company purchased a
$40 million interest rate cap, effective September 30, 1994, for
a three-year term, which provides for quarterly payments to the
Company in the event that three-month LIBOR exceeds 7% on any
quarterly reset date.  The Company is exposed to credit risks in
the event of non-performance by the counterparty.  However, the
Company does not anticipate non-performance by the counterparty.
The counterparty under these agreements is B of A, the lead bank
in the syndicate participating in the Rio Bank Loan.  Management
believes that the financial resources of B of A and its
competitive position within the national banking industry
significantly reduce the chances of non-performance under the
interest rate swap and cap agreements.

     The Rio Bank Loan is secured by a first deed of trust on the
Rio, a security interest in substantially all of Rio Properties
other real and personal property, and a guaranty by Rio Hotel &
Casino, Inc., including a pledge of the Company's stock in Rio
Properties.  The Rio Bank Loan provides that Rio Hotel & Casino,
Inc. will be permitted to accumulate and hold up to $5 million in
assets which are not to be pledged for the benefit of the Rio
Bank Loan lenders.

     The Rio Bank Loan contains certain customary financial
covenants to which the Company is subject.  Those covenants
include a requirement that Rio Properties maintain a maximum
ratio of Total Debt (as defined in the Rio Bank Loan) to EBITDA
(as defined in the Rio Bank Loan) ranging from 3.0 to 1 at
December 31, 1995, increasing to 4.25 to 1 for the six month
period ending March 31, 1997 and decreasing to 3.0 to 1 at
December 31, 1997 and thereafter.  Rio Properties must meet a
maximum ratio of Senior Debt (as defined in the Rio Bank Loan) to
EBITDA from 1.75 to 1 through December 31, 1995 up to 3.0 to 1
for the six months ended March 31, 1997 and reducing to 1.75 to 1
at December 31, 1997 and thereafter.  Rio Properties must
maintain a maximum Interest Coverage Ratio (as defined in the Rio
Bank Loan) of 2.0 to 1 through the fiscal quarter ending December
31, 1996, reducing to 1.5 to 1 for the fiscal quarter ending
March 31, 1997 and increasing to 3.0 to 1 for the fiscal quarter
ending December 31, 1998 and thereafter.  Minimum Consolidated
Tangible Net Worth (as defined in the Rio Bank Loan) requirements
of $125 million, plus 75% of accumulated net income after
December 31, 1994 (not reduced by any consolidated net losses)
plus 100% of the net proceeds of any equity offering by Rio
Properties or the Company must be maintained.  A maximum annual
capital expenditure permitted under the Rio Bank Loan is
$7.5 million annually, plus the amount available of unused
capital expenditures from the prior fiscal year, but not to
exceed $12.5 million, annually in any event.  A specific carve-
out of $200 million for the Phase V Expansion and $30 million for
the identified adjacent Rio land acquisition is incorporated in
the Rio Bank Loan.  The Rio Bank Loan also provides for a basket
for $10 million for the repurchase of equity shares of the
Company through open market purchases over the life of the Rio
Bank Loan.

     On July 18, 1995, the Company entered into an agreement with
Salomon Brothers Inc. and Montgomery Securities (the "Initial
Purchasers") for the sale by the Company of $100 million in
principal amount of the Company's 10 5/8% Senior Subordinated
Notes Due

                                 27

<PAGE>

2005 (the "Old Notes").  The Old Notes were purchased by the
Initial Purchasers for resale to qualified institutional
investors.  The net proceeds from the sale of the Old Notes
(approximately $96.7 million after the deduction of a 2.75%
discount to the Initial Purchasers and offering expenses of
approximately $0.5 million), borrowings under the Rio Bank Loan,
cash on hand and cash from operations will be used to finance the
Company's approximately $185 million Phase V Expansion.  Pending
such use, the net proceeds were used to reduce amounts
outstanding under the Rio Bank Loan.  Pursuant to a registration
agreement between the Company and the Initial Purchasers, the Company
registered on Form S-4 under the Securities Act of 1933
$100 million principal amount of 10 5/8% Senior Subordinated
Notes Due 2005 (the "New Notes") which were exchanged for the Old
Notes (the Old Notes and the New Notes are collectively referred
to as the "Subordinated Notes").

     The Subordinated Notes were issued under an indenture (the
"Indenture") dated July 21, 1995 among the Company, Rio
Properties and IBJ Schroder Bank & Trust Company, as trustee.
The following summary of certain provisions of the Indenture does
not purport to be complete and is subject to the provisions of
the Indenture and the Subordinated Notes.  Capitalized terms not
otherwise defined have the same meanings assigned to them in the
Indenture.

     The Subordinated Notes mature on July 15, 2005.  Interest
payment dates under the Subordinated Notes are January 15 and
July 15, commencing January 15, 1996.  The Subordinated Notes are
fully and unconditionally guaranteed (the "Rio Guarantee") on a
senior subordinated basis by Rio Properties.  The Subordinated
Notes are subordinated in right of payment to all existing and
future Senior Indebtedness of the Company and are structurally
subordinated to all existing and future indebtedness and other
liabilities (including trade payables) of the Company's
subsidiaries.  The Rio Guarantee is subordinated in right of
payment to all existing and future Senior Indebtedness (as
defined in the Indenture) of Rio Properties and is structurally
subordinated to all existing and future indebtedness and other
liabilities (including trade payables) of Rio Properties'
subsidiaries.

     The Subordinated Notes may be redeemed at the option of the
Company, in whole or in part, at any time on or after July 15,
2000, at the redemption prices set forth in the Indenture, plus
accrued and unpaid interest, if any, through the redemption date.
The Subordinated Notes will be redeemed from any holder or
beneficial owner of the Subordinated Notes which is required to
be found suitable and is not found suitable by the Nevada Gaming
Commission.

     Upon a Change of Control of the Company (as defined in the
Indenture), each holder of Subordinated Notes will have the right
to require the Company to repurchase all or part of such holder's
Subordinated Notes at a price equal to 101% of the aggregate
principal amount thereof, plus accrued and unpaid interest, if
any, to the date of repurchase.  The Company's obligation to
repurchase the Subordinated Notes is guaranteed on a senior
subordinated basis by Rio Properties.  The Indenture contains
certain covenants that, among other things, limit the ability of
the Company and its Restricted Subsidiaries (as defined in the
Indenture) to incur additional indebtedness, pay dividends or
make other distributions, make investments, repurchase
subordinated obligations or capital stock, create certain liens
(except, among others, liens

                                 28

<PAGE>

securing Senior Indebtedness), enter into certain transactions
with affiliates, sell assets of the Company or its subsidiaries,
issue or sell subsidiary stock, create or permit to exist
restrictions on distributions from subsidiaries, or enter into
certain mergers and consolidations.

     On May 2, 1995, the Company announced a three-phase
expansion and development plan to grow the Company over the next
several years.  The plan includes the Phase V Expansion on the
existing Rio site, acquisition of approximately 22 acres of land
adjacent to the Rio site to be master-planned for another hotel-
casino property and the purchase of the Old Vegas Site for
possible future hotel-casino development.

     The Company cannot accurately state the timing for the
funding requirements of the approximately $185 million Phase V
Expansion costs.  Construction commenced in September 1995 and
opening is expected to occur in the spring of 1997.  The Company
spent approximately $7.9 million on the Phase V Expansion in 1995
and management anticipates that the bulk of the funds will be
applied in 1996 and the balance of the funds will be applied in
1997.  The $185 million Phase V Expansion will be financed with
the proceeds from the Subordinated Notes, funds available under
the Rio Bank Loan, cash on hand and cash from operations.

     As described above, the Company has acquired approximately
five acres of land adjacent to the Rio and has entered into
agreements to acquire an additional approximately 17 acres of
land adjacent to the Rio site.  The combined cost of the
approximately 22 acres is approximately $20.3 million, which the
Company will fund through cash on hand, cash available through
borrowings under the Rio Bank Loan and cash from operations.  The
entire Rio site is now being master-planned for the development
of another hotel-casino, the size and timing of which has not yet
been determined.

     As the third step in its expansion and development plan to
provide further growth for the Company, the Company acquired the
Old Vegas Site southeast of Las Vegas.  The cost of the Old Vegas
Site was approximately $5.7 million (net of a credit for profit
participation from the seller to which the Company was entitled)
which the Company funded through cash on hand and cash available
through borrowings under the Rio Bank Loan.  The timing of the
proposed development on the Old Vegas Site has not yet been
determined.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                                 29

<PAGE>

            REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
                               
                                
To the Board of Directors of
 Rio Hotel & Casino, Inc.:
 
     We have audited the accompanying consolidated balance sheets
of   RIO  HOTEL  &  CASINO,  INC.  (a  Nevada  corporation)   and
subsidiaries  as  of December 31, 1995 and 1994 and  the  related
consolidated statements of income, stockholders' equity and  cash
flows   for  each  of  the  three  years  in  the  period   ended
December  31, 1995. These financial statements and the  schedules
referred  to  below  are  the  responsibility  of  the  Company's
management. Our responsibility is to express an opinion on  these
financial statements and schedules based on our audits.

     We   conducted  our  audits  in  accordance  with  generally
accepted auditing standards. Those standards require that we plan
and  perform  the  audit  to  obtain reasonable  assurance  about
whether   the   financial  statements  are   free   of   material
misstatement.  An  audit includes examining,  on  a  test  basis,
evidence  supporting the amounts and disclosures in the financial
statements.  An  audit  also includes  assessing  the  accounting
principles used and significant estimates made by management,  as
well  as evaluating the overall financial statement presentation.
We  believe  that our audits provide a reasonable basis  for  our
opinion.

     In  our opinion, the financial statements referred to  above
present  fairly, in all material respects, the financial position
of  Rio Hotel & Casino, Inc. and subsidiaries as of December  31,
1995 and 1994, and the results of their operations and their cash
flows   for  each  of  the  three  years  in  the  period   ended
December   31,  1995,  in  conformity  with  generally   accepted
accounting principles.

     As  discussed  in  Note  7  to  the  consolidated  financial
statements,  effective January l, 1993, the Company  changed  its
method of accounting for income taxes.

     Our  audits were made for the purpose of forming an  opinion
on the basic financial statements taken as a whole. The financial
statement  schedules listed in Item 14 are the responsibility  of
the  Company's  management  and are  presented  for  purposes  of
complying with the Securities and Exchange Commission's rules and
are  not  part of the basic financial statements. These schedules
have  been  subjected to the auditing procedures applied  in  the
audits  of  the basic financial statements and, in  our  opinion,
fairly state in all material respects the financial data required
to  be  set  forth  therein in relation to  the  basic  financial
statements taken as a whole.

                              ARTHUR ANDERSEN LLP
                              
                              
Las Vegas, Nevada
January 26, 1996

                                 30

<PAGE>

<TABLE>                      
<CAPTION>
                                RIO HOTEL & CASINO, INC. and SUBSIDIARIES
                                       CONSOLIDATED BALANCE SHEETS


                                                         DECEMBER 31,     DECEMBER 31,
                                                             1995             1994

   ASSETS
<S>                                                     <C>              <C>
CURRENT ASSETS:
   CASH AND CASH EQUIVALENTS                            $  19,992,695    $  76,426,258
   ACCOUNTS RECEIVABLE, NET                                 4,313,442        3,204,416
   FEDERAL INCOME TAXES RECEIVABLE                            190,914          139,329
   INVENTORIES                                              1,794,850        1,378,598
   PREPAID EXPENSES AND OTHER CURRENT ASSETS                4,638,090        4,716,701

   TOTAL CURRENT ASSETS                                    30,929,991       85,865,302

PROPERTY AND EQUIPMENT:
   LAND AND IMPROVEMENTS                                   37,509,960       24,666,679
   BUILDING AND IMPROVEMENTS                              192,818,896      137,005,432
   EQUIPMENT, FURNITURE, AND IMPROVEMENTS                  68,500,267       43,108,873
   LESS:  ACCUMULATED DEPRECIATION                        (46,707,850)     (32,826,276)
                                                          252,121,273      171,954,708

   CONSTRUCTION IN PROGRESS                                17,173,483       38,521,773

       NET PROPERTY AND EQUIPMENT                         269,294,756      210,476,481

OTHER ASSETS:
   OTHER, NET                                               8,566,847        4,823,489

                                                        $ 308,791,594    $ 301,165,272

   LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
   CURRENT MATURITIES OF LONG-TERM DEBT                 $      25,252    $  15,032,534
   ACCOUNTS PAYABLE                                         4,562,132        2,425,645
   ACCRUED EXPENSES                                         9,136,226        7,830,706
   ACCOUNTS PAYABLE-RELATED PARTY                           6,641,506       10,026,210
   ACCRUED INTEREST                                         4,726,915          351,864

       TOTAL CURRENT LIABILITIES                           25,092,031       35,666,959

NON-CURRENT LIABILITIES:
   LONG-TERM DEBT, LESS CURRENT MATURITIES                110,176,765      110,146,869
   DEFERRED INCOME TAXES                                   10,634,898        7,512,277

       TOTAL NON-CURRENT LIABILITIES                      120,811,663      117,659,146

       TOTAL LIABILITIES                                  145,903,694      153,326,105

COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
   COMMON STOCK, $0.01 PAR VALUE;
   100,000,000 SHARES AUTHORIZED;
   21,139,146 (1995) AND  21,371,346 (1994) SHARES
   ISSUED AND OUTSTANDING                                     211,392          213,714
   ADDITIONAL PAID-IN CAPITAL                             113,520,158      117,214,582
   RETAINED EARNINGS                                       49,156,350       30,410,871
                                                                           
                                                                           
                                                                           
       TOTAL STOCKHOLDERS' EQUITY                         162,887,900      147,839,167

                                                        $ 308,791,594    $ 301,165,272



                  SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

</TABLE>
                                                   31
<PAGE>

<TABLE>
<CAPTION>

                     RIO HOTEL & CASINO, INC. and SUBSIDIARIES
                         CONSOLIDATED STATEMENTS OF INCOME

                                       FOR THE YEAR ENDED DECEMBER 31,

                                       1995             1994            1993

<S>                                    <C>              <C>              <C>
REVENUES:
   CASINO                              $ 105,546,531    $ 87,164,738     $  71,295,870
   ROOM                                   33,826,095      19,261,477        12,334,207
   FOOD AND BEVERAGE                      60,009,994      47,648,778        32,573,861
   OTHER                                  11,966,060       7,111,105         4,172,272
   CASINO PROMOTIONAL ALLOWANCES         (18,810,726)    (14,886,794)      (10,394,625)
                                         192,537,954     146,299,304       109,981,585
                                    
EXPENSES:
   CASINO                                48,071,953      38,696,281        31,177,642
   ROOM                                  10,413,883       6,631,787         4,441,851
   FOOD AND BEVERAGE                     48,257,881      38,795,127        27,799,449
   OTHER                                  6,646,950       4,959,250         2,784,746
   SELLING, GENERAL AND ADMINISTRATIVE   27,777,901      20,550,142        16,001,309
   DEPRECIATION AND AMORTIZATION         14,231,307      10,863,844         7,544,326
                                        155,399,875     120,496,431        89,749,323
OPERATING PROFIT                         37,138,079      25,802,873        20,232,262

OTHER INCOME (EXPENSE):
   INTEREST INCOME                          420,215         124,786            71,747
   INTEREST EXPENSE                      (8,105,680)     (1,923,237)       (1,838,713)
   OTHER INCOME, NET                        - - -         1,140,010           - - -
                                         (7,685,465)       (658,441)       (1,766,966)
                                                                       
INCOME BEFORE INCOME TAX PROVISION       29,452,614      25,144,432        18,465,296
INCOME TAX PROVISION                    (10,707,135)     (9,178,023)       (6,785,305)
INCOME BEFORE EXTRAORDINARY ITEMS        18,745,479      15,966,409        11,679,991
                                                        
EXTRAORDINARY ITEMS:
   LOSS ON EARLY EXTINGUISHMENT OF
   DEBT, NET OF INCOME TAX BENEFIT          - - -           - - -            (253,711)

CUMULATIVE EFFECT OF A CHANGE IN
ACCOUNTING PRINCIPLE:
   ADOPTION OF SFAS NO. 109                 - - -           - - -            (776,888)
   NET INCOME                           $18,745,479     $15,966,409      $ 10,649,392



              SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
</TABLE>

                                              32
<PAGE>

<TABLE>
<CAPTION>
                    RIO HOTEL & CASINO, INC. and SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF INCOME (CONTINUED)


                                              FOR THE YEAR ENDED DECEMBER 31,

                                                1995           1994         1993

<S>                                        <C>            <C>           <C>
EARNINGS PER COMMON SHARE:
 PRIMARY:
  INCOME APPLICABLE TO
   COMMON SHARES                                $0.87          $0.74         $0.60

  EXTRAORDINARY ITEMS:
   LOSS ON EARLY EXTINGUISHMENT OF
   DEBT, NET OF INCOME TAX BENEFIT              - - -          - - -        ($0.01)

  CUMULATIVE EFFECT OF A CHANGE
   IN ACCOUNTING PRINCIPLE:
   ADOPTION OF SFAS 109                         - - -          - - -        ($0.04)

   NET INCOME                                   $0.87          $0.74         $0.55

WEIGHTED AVERAGE NUMBER OF
 COMMON SHARES OUTSTANDING                 21,591,325     21,720,121    19,504,466




 FULLY DILUTED:
  INCOME APPLICABLE TO
   COMMON SHARES                                $0.87          $0.74         $0.60

  EXTRAORDINARY ITEMS:
   LOSS ON EARLY EXTINGUISHMENT OF
   DEBT, NET OF INCOME TAX BENEFIT              - - -          - - -        ($0.01)

  CUMULATIVE EFFECT OF A CHANGE
   IN ACCOUNTING PRINCIPLE:
   ADOPTION OF SFAS 109                         - - -          - - -        ($0.04)

   NET INCOME                                   $0.87          $0.74         $0.55

WEIGHTED AVERAGE NUMBER OF
 COMMON SHARES OUTSTANDING                 21,592,769     21,720,381    19,537,515



            SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

</TABLE>
                                           33
<PAGE>

<TABLE>    
<CAPTION>
                     RIO HOTEL & CASINO, INC. and SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

                                                     COMMON STOCK

                                                NUMBER                        ADDITIONAL
                                                  OF                           PAID-IN
                                                SHARES         AMOUNT          CAPITAL
                                             
<S>                                           <C>              <C>          <C>
Balance, December 31, 1992                    18,600,796       $186,008     $82,891,073

Tax benefit of stock options granted                                          1,120,823

Issuance of common stock                       2,547,000         25,470      32,480,730

Common stock offering costs                                                    (541,066)

Net income for the year

Implementation of SFAS No. 109                                                 (823,152)

Compensation expense for stock
   options granted                                                               54,133

Balance, December 31, 1993                    21,147,796        211,478     115,182,541

Tax benefit of stock options granted                                            886,132

Exercise of common stock options                 223,550          2,236       1,003,934

Net income for the year

Compensation expense for stock
   options granted in 1993                                                      141,975

Balance, December 31, 1994                    21,371,346        213,714     117,214,582

Tax benefit of stock options granted                                            632,601

Exercise of common stock options                 198,300          1,983         965,467

Repurchase of common stock                      (430,500)        (4,305)     (5,381,920)

Common stock offering costs                                                       1,801

Net income for the year

Compensation expense for stock
   options granted in 1993                                                       87,627

Balance, December 31, 1995                    21,139,146       $211,392    $113,520,158

                               See Accompanying Notes to Consolidated Financial Statements
</TABLE>

<TABLE>
<CAPTION>                                  
                            
               RIO HOTEL & CASINO, INC. and SUBSIDIARIES
            CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY


                                                               TOTAL
                                             RETAINED       STOCKHOLDERS'
                                             EARNINGS          EQUITY
                                                            
<S>                                          <C>           <C>
Balance, December 31, 1992                    $3,795,070    $86,872,151

Tax benefit of stock options granted                          1,120,823

Issuance of common stock                                     32,506,200

Common stock offering costs                                    (541,066)

Net income for the year                       10,649,392     10,649,392

Implementation of SFAS No. 109                                 (823,152)

Compensation expense for stock
   options granted                                               54,133

Balance, December 31, 1993                    14,444,462    129,838,481

Tax benefit of stock options granted                            886,132

Exercise of common stock options                              1,006,170

Net income for the year                       15,966,409     15,966,409

Compensation expense for stock
   options granted in 1993                                      141,975

Balance, December 31, 1994                    30,410,871    147,839,167

Tax benefit of stock options granted                            632,601

Exercise of common stock options                                967,450

Repurchase of common stock                                   (5,386,225)

Common stock offering costs                                       1,801

Net income for the year                       18,745,479     18,745,479

Compensation expense for stock
   options granted in 1993                                       87,627
                                             
Balance, December 31, 1995                   $49,156,350   $162,887,900


                    See Accompanying Notes to Consolidated Financial Statements

</TABLE>
                                                 34
<PAGE>

<TABLE>                    
<CAPTION>
                    RIO HOTEL & CASINO, INC. AND SUBSIDIARIES
                       CONSOLIDATED STATEMENTS OF CASH FLOW

                                                            For the Year Ended December 31,

                                                                  1995                      1994

<S>                                                       <C>                        <C>
Cash flows from operating activities:
  Net income                                              $       18,745,479         $      15,966,409
  Adjustments to reconcile net income
    to net cash provided by (used in)
    operating activities:
      Loss on early extinguishment of debt,
        net of income tax benefit                                    - - -                     - - -
      Compensation expense recognized
        from stock option grant                                       87,627                   141,975
      Depreciation and amortization                               14,231,307                10,863,844
      Provision for uncollectible accounts                         1,002,463                   512,999
      Net loss on sale of assets                                     - - -                     - - -
      Cumulative effect of change in accounting
        principle - Adoption of SFAS 109                             - - -                     - - -
      Deferred income taxes                                        3,122,621                 1,693,101
      (Increase) decrease in assets:
        Accounts receivable                                       (2,026,109)                 (790,677)
        Inventories                                                 (416,252)                 (510,231)
        Prepaid expenses and other current
          assets                                                     659,627                  (827,476)
        Other, net                                                  (843,335)               (2,881,750)
      Increase (decrease) in liabilities:
        Accounts payable                                           2,136,487                  (522,443)
        Accrued federal income tax payable                           - - -                     546,142
        Accrued expenses                                           1,305,520                 1,306,086
        Accrued interest                                           4,375,051                   297,896
Net cash provided by operating activities                         42,380,486                25,795,875

Cash flows from investing activities:
  Purchase of equipment, furniture and
    improvements                                                 (63,326,652)              (66,053,542)
  Purchase of land and improvements                              (12,781,239)                  - - -
Net cash (used in) investing activities                          (76,107,891)              (66,053,542)

Cash flows from financing activities:
  Proceeds from borrowings                                        10,000,000                60,014,175
  Net proceeds from common stock issuance                            969,251                 1,022,700
  Net proceeds from issuance of senior
    subordianted notes                                            96,750,244                   - - -
  Repurchase of common stock                                      (5,386,225)                  - - -
  Costs paid in connection with prior common
    stock offering and stock exchange rights                         - - -                    (119,529)
  Loan acquisition costs                                             - - -                     - - -
  Payments on notes and loans payable                           (125,039,428)                  (18,358)
Net cash (used in) provided by financing activities              (22,706,158)               60,898,988

  Net increase (decrease) in cash
    and cash equivalents                                         (56,433,563)               20,641,321
Cash and cash equivalents, beginning of period                    76,426,258                55,784,937

Cash and cash equivalents, end of period                  $       19,992,695         $      76,426,258


          See Accompanying Notes to Consolidated Financial Statements

</TABLE>

<TABLE>
<CAPTION>

                  RIO HOTEL & CASINO, INC. AND SUBSIDIARIES
                    CONSOLIDATED STATEMENTS OF CASH FLOW

                                                  For the Year Ended December 31,

                                                                  1993

<S>                                                       <C>
Cash flows from operating activities:                     $       10,649,392
  Net income
  Adjustments to reconcile net income
    to net cash provided by (used in)
    operating activities:
      Loss on early extinguishment of debt,                          253,711
        net of income tax benefit
      Compensation expense recognized                                 54,133
        from stock option grant                                    7,544,326
      Depreciation and amortization                                  523,491
      Provision for uncollectible accounts                            10,885
      Net loss on sale of assets
      Cumulative effect of change in accounting                      776,888
        principle - Adoption of SFAS 109                           2,265,571
      Deferred income taxes
      (Increase) decrease in assets:                              (1,891,439)
        Accounts receivable                                         (223,051)
        Inventories
        Prepaid expenses and other current                          (856,554)
          assets                                                    (662,965)
        Other, net
      Increase (decrease) in liabilities:                            304,585
        Accounts payable                                              91,401
        Accrued federal income tax payable                         1,628,387
        Accrued expenses                                             (92,009)
        Accrued interest                                          20,376,752
Net cash provided by operating activities

Cash flows from investing activities:
  Purchase of equipment, furniture and                           (49,967,458)
    improvements                                                      22,499
  Purchase of land and improvements                              (49,944,959)
Net cash (used in) investing activities

Cash flows from financing activities:                             65,000,000
  Proceeds from borrowings                                        32,506,200
  Net proceeds from common stock issuance
  Net proceeds from issuance of senior                               - - -
    subordianted notes                                               - - -
  Repurchase of common stock
  Costs paid in connection with prior common                        (456,821)
    stock offering and stock exchange rights                      (1,107,647)
  Loan acquisition costs                                         (53,212,000)
  Payments on notes and loans payable                             42,729,732
Net cash (used in) provided by financing activities

  Net increase (decrease) in cash                                 13,161,525
    and cash equivalents                                          42,623,412
Cash and cash equivalents, beginning of period
                                                          $       55,784,937
Cash and cash equivalents, end of period

         See Accompanying Notes to Consolidated Financial Statement

</TABLE>

                                 35
<PAGE>


           RIO HOTEL & CASINO, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.   SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS
     PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION
     
     The consolidated financial statements include the accounts
     of Rio Hotel & Casino, Inc. and its wholly owned
     subsidiaries Rio Properties, Inc. ("Rio Properties," which
     owns and operates the Rio Suite Hotel & Casino (the "Rio")
     in Las Vegas, Nevada); Rio Development Company, Inc.
     (formerly MarCor Development Company, Inc.); Rio Resort
     Properties, Inc. (formerly MarCor Resort Properties, Inc.);
     and Rio Properties' wholly owned subsidiary, Cinderlane,
     Inc.

     All significant intercompany balances and transactions have
     been eliminated in consolidation.
     
     RECLASSIFICATIONS
     
     The financial statements for prior periods reflect certain
     reclassifications, which have no effect on net income, to
     conform with classifications adopted in the current year.

     USE OF ESTIMATES
     
     The preparation of financial statements in conformity with
     generally accepted accounting principles requires management
     to make estimates and assumptions that affect the reported
     amounts of assets and liabilities and disclosure of
     contingent assets and liabilities at the date of the
     financial statements and the reported amounts of revenues
     and expenses during the reporting period.  Actual results
     could differ from these estimates.

     CAPITALIZATION OF INTEREST
     
     The Company capitalizes interest on funds disbursed during
     the active construction phases of real estate development
     and other major projects. Interest capitalized during the
     years ended December 31, 1995, 1994, and 1993 was $949,423,
     $619,887 and $467,798, respectively.

     PROPERTY AND EQUIPMENT
     
     Land and improvements, building and improvements, and
     equipment, furniture and improvements are stated at cost.

     Depreciation and amortization of property and equipment is
     computed using the straight-line method predominantly over
     the following estimated useful lives:

                                 36

<PAGE>

     Building and improvements                 7 to 45 years
     Equipment, furniture and improvements     3 to 15 years

     Costs of major improvements are capitalized, while costs of
     normal repairs and maintenance are charged to expense as
     incurred.
     
     IMPAIRMENT
     
     Management reviews existing information and analyses of the
     Company and its operations as well as indicators of
     impairment (such as dramatic changes in the manner in which
     an asset is used or forecasts showing lack of long-term
     profitability) to determine whether an impairment may exist.
     The Company considers relevant cash flow and profitability
     information, including estimated future operating results,
     trends and other available information, in assessing whether
     the carrying value of its fixed assets can be recovered.
     Upon a determination that the carrying value of an asset
     will not be recovered from its future undiscounted cash
     flows, the carrying value of that asset would be considered
     impaired and will be reduced by a charge to operations in
     the amount of the impairment.  Impairment is measured as any
     deficiency in estimated undiscounted future cash flows of
     the fixed assets to recover the carrying value related to
     those assets.

     INVENTORIES
     
     Inventories are stated at the lower of cost or market. Cost
     is determined by using the first-in, first-out method.

     REVENUE AND PROMOTIONAL ALLOWANCES
     
     Casino revenues represent the net win from gaming wins and
     losses. The retail value of rooms, food, beverage and other
     services provided to customers without charge is included in
     gross revenue and deducted as promotional allowances. The
     estimated departmental costs of providing such promotional
     allowances are included in casino costs and expenses as
     follows:

<TABLE>
<CAPTION>

                                 For the Year Ended December 31,
                                 1995         1994         1993
     <S>                     <C>          <C>           <C>
     Room                    $ 1,940,936  $1,273,154    $  889,448
     Food and Beverage         9,020,152   7,823,819     5,969,683
     Other operating expenses    104,921      44,888        36,940
                             $11,066,009  $9,141,861    $6,896,071
                               

</TABLE>

                                 37
<PAGE>

     EARNINGS PER SHARE
     
     Earnings per common share are computed on the basis of the
     weighted average number of common shares and common stock
     equivalents outstanding during the period.

     HEDGING TRANSACTION
     
     The Company is a party to an interest rate swap agreement
     and has purchased an interest rate cap (Note 6).  Any net
     payments made or received by the Company in connection with
     this interest rate swap agreement or interest rate cap, or
     any other hedging transaction that the Company may enter
     into, will be classified as cash flows from operating
     activities.
     
     Premiums paid for the interest rate cap agreements are
     amortized to interest expense over the shorter of the
     original life of the debt or the term of the cap.
     Unamortized premiums are included in other assets in the
     statement of financial position.  Accounts receivable under
     the agreements are accrued as a reduction of interest
     expense.  Amounts payable under the interest rate swap
     agreements are included in interest expense.

     INCOME TAXES
     
     Effective January 1, 1993, the Company implemented the
     provisions of SFAS 109.  SFAS 109 utilizes the liability
     method and deferred taxes are determined based on the
     estimated future tax effects of differences between the
     financial statement and tax bases of assets and liabilities
     given the provisions of the enacted tax laws.

2.   CASH AND CASH EQUIVALENTS

     Cash and cash equivalents at December 31, 1995 and 1994
     include $10 million and $68 million, respectively, in
     overnight repurchase agreements with a bank. These items are
     recorded at cost which approximates market value and are
     considered cash equivalents for purposes of the Consolidated
     Statements of Cash Flows.

3.   CONSOLIDATED STATEMENTS OF CASH FLOWS

     The following supplemental disclosures are provided as part
     of the Consolidated Statements of Cash Flows:

<TABLE>
<CAPTION>

                                For the Year Ended December 31,
                               1995           1994         1993

     <S>                      <C>            <C>          <C>
     Cash payments made for                                   
       interest (net of                                       
       amounts capitalized)   $3,904,540     $1,919,556   $1,728,693
     Cash payments made for                                   
       income taxes           $7,100,000     $6,240,000   $4,428,335
                                             
</TABLE>
                                 38

<PAGE>

     Non-cash financing and investing activities:
     
     DECEMBER 31, 1995
     
     Purchase of property and equipment financed through payables
     totaled $6,556,126.
     
     Purchase of land financed through long-term debt totaled
     $62,042.
     
     Accounts receivable increased by $85,380.  This was financed
     through payables and will be reimbursed to the Company.
     
     Tax benefit arising from the exercise of stock options
     granted under the Company's Non-Statutory Stock Option Plan
     ("NSOP") totaled $632,601.

     DECEMBER 31, 1994

     Purchase of property and equipment financed through payables
     totaled $10,026,210.
     
     Tax benefit arising from the exercise of stock options
     granted under NSOP totaled $886,132.

     DECEMBER 31, 1993

     Purchase of property and equipment financed through payables
     totaled $8,442,660.

     Purchase of property and equipment financed through long-
     term debt totaled $183,586.

     Additional costs of issuing Common Stock totaled $12,194.

     Costs of issuing Common Stock financed through payables
     totaled $163,801.

     Tax benefit arising from the exercise of stock options
     granted under the NSOP totaled $1,120,823.

     Reduction in paid-in capital as a result of the
     implementation of SFAS 109 totaled $823,152.  This amount
     was charged directly against equity because it reflects the
     tax effect of SFAS 109 as it related to the gain on sale of
     assets to affiliates of the Company's largest stockholder in
     December 1991, which was also recorded directly to equity.

                                 39

<PAGE>

4.   ACCOUNTS RECEIVABLE

     Components of receivables are as follows:

<TABLE>
<CAPTION>

                                              December 31,
                                          1995           1994
    <S>                                 <C>            <C>
    Casino                              $3,267,244     $2,082,871
    Hotel                                1,757,640      1,534,107
    Other                                  113,250         66,573                 
                                         5,138,134      3,683,551  

    Less allowance for doubtful
      accounts                            (824,692)      (479,135)
                                        $4,313,442     $3,204,416

</TABLE>

5.   ACCRUED EXPENSES

     Components of accrued expenses are as follows:

<TABLE>
<CAPTION>
                                      
                                               December 31,
                                            1995          1994
     <S>                                 <C>           <C>
     Accrued salaries, wages and
     related benefits                    $4,065,736    $4,004,080
     Progressive slot machines and                          
     other gaming accruals                2,532,964     2,033,406
     Accrued gaming taxes                 1,714,232     1,123,036
     Other accrued liabilities              823,294       670,184
                                         $9,136,226    $7,830,706

</TABLE>

                                 40
<PAGE>

6.   LONG-TERM DEBT

     Long-term debt consists of the following:

<TABLE>
<CAPTION>

                                                 December 31,
                                               1995          1994

     <S>                                   <C>            <C>
     Rio Bank Loan, originally a                                     
     $65 million revolving credit                                    
     facility, which was amended to be                               
     a $175 million revolving credit                                 
     facility with interest equal to                                 
     the Eurodollar Rate or the Base                                 
     Rate, plus a margin.  The loan                                  
     matures on June 30, 2001 and is 
     collateralized by a first deed of                              
     trust on the Rio's real property,
     equipment and improvements.           $ 10,000,000   $125,000,000
     
     10 5/8% Senior Subordinated                                     
     Notes, interest only payable semi-                              
     annually; principal due July 15,
     2005.                                  100,000,000         - - -
     
     Special Improvement District                                    
     assessment bonds, payable over 10                               
     years in twenty substantially                                   
     equal semi-annual installments of
     principal, plus 6.1% interest.             202,017       165,228
     
     Other  short-term  financing   of                               
     certain insurance premiums                   - - -        14,175
                                            110,202,017   125,179,403
          Less current maturities               (25,252)  (15,032,534)
                                           $110,176,765  $110,146,869
                                                                    

</TABLE>

     The prime interest rate quoted by the Company's primary
     lenders at December 31, 1995 and 1994 was 8.50%.

     At December 31, 1995, the three month Eurodollar Rate was
     5.625%.  The margin on the Company's Eurodollar Rate
     borrowings at December 31, 1995 was 2.00%.

     The Rio Bank Loan was originally entered into on July 15,
     1993 in the amount of $65 million with a syndicate of banks
     consisting of Bank of America National Trust Savings and
     Association, Bank of America Nevada, Societe Generale, NBD
     Bank, N.A., First Security Bank of Idaho, N.A., First
     Interstate Bank of Nevada, N.A. and U. S. Bank of Nevada.
     As a result of certain amendments, in December 1994, the Rio
     Bank Loan was increased to $125 million and in September
     1995, the Rio Bank Loan was increased to $175 million.  As
     amended, the Rio Bank Loan is a secured reducing revolving
     credit facility to be used (a) to refinance the pre-
     amendment Rio Bank Loan, (b) to finance the
     
                                 41     
                                 
<PAGE>

     Phase V Expansion, (c) to finance acquisition of land
     adjacent to the Rio for up to $30 million, and (d) for
     general corporate purposes.
     
     The Rio Bank Loan matures on June 30, 2001 and will bear
     interest based upon a "LIBOR Spread" of from 1% to 3%, or a
     "Base Rate Spread" of from 0% to 2.0% based upon a schedule
     determined with reference to Rio Properties' "Funded Debt to
     EBITDA Ratio".  The "LIBOR Spread" is the amount in excess
     of the applicable LIBOR rate which is the London interbank
     offer rate established in the London interbank market.  The
     "Base Rate Spread" is the amount in excess of the applicable
     base rate, which is the rate per annum equal to the higher
     of the reference rate as it is publicly announced from time
     to time by Bank of America in San Francisco or 0.50% per
     annum above the latest Federal Funds rate.  The Rio Bank
     Loan provides for an unused facility fee ranging from 31.25
     basis points to 50.0 basis points depending upon the same
     Funded Debt to EBITDA ratio schedule utilized for the
     interest rate.  (A basis point is one one-hundredth of one
     percent.)  The Rio Bank Loan requires monthly payments of
     interest and will require scheduled reductions of the
     maximum amount available under the Rio Bank Loan commencing
     with a $10 million reduction at December 31, 1997, a $7.5
     million reduction at the end of each quarter during 1998 and
     1999, a $10.0 million reduction at the end of each quarter
     during 2000, a $32.5 million reduction at March 31, 2001 and
     maturity at June 30, 2001.
     
     To reduce the risks from interest rate fluctuations, the
     Company entered into interest rate swap agreements in the
     amount of $20 million from September 30, 1994 through
     December 29, 1995 and $15 million from December 29, 1995
     through June 28, 1996.  In August 1994, the Company
     purchased a $40 million interest rate cap, effective
     September 30, 1994, for a three-year term, which provides
     for quarterly payments to the Company in the event that
     three-month LIBOR exceeds 7% on any quarterly reset date.
     The Company is exposed to credit risks in the event of non-
     performance by the counterparty.  At December 31, 1995, the
     potential maximum credit risk amounted to $464,333, which is
     the carrying value of the unamortized premium.  However, the
     Company does not anticipate non-performance by the
     counterparty.  The counterparty under these agreements is
     Bank of America National Trust and Savings Association ("B
     of A"), the lead bank in the syndicate participating in the
     Rio Bank Loan.  Management believes that the financial
     resources of B of A and its competitive position within the
     national banking industry significantly reduce the chances
     of non-performance under the interest rate swap and cap
     agreements.
     
     The following table discloses (i) the aggregate amount of
     interest rate swaps categorized by annual maturity and (ii)
     the related weighted average interest rate paid and received
     assuming current market conditions:
     
                                 42

<PAGE>

<TABLE>
<CAPTION>
               Maturity:    1996       1997    1998   1999  2000    Total

    <S>                  <C>           <C>     <C>    <C>   <C>    <C>
    Company pays Fixed
     Weighted Average    $15,000,000   $---    $---   $---  $---   $15,000,000
                                                           
          Interest Rate:                                   
     Received by                          
     Company<F1>           5.875%
     Paid by Company       4.950%                          
                                                           
<FN>
<F1> The Company receives 3-month LIBOR, which was reset at
     5.6875% for the three-month period beginning December 29, 1995.
</FN>
     
</TABLE>

     At December 31, 1995 the interest rate swap and interest
     rate cap agreements had fair market values of $39,774 and
     $28,356, respectively (carrying values of $0 and $464,333,
     respectively).  Management is of the opinion that the fair
     values of all other financial instruments are not materially
     different from their carrying values.
     
     As a result of entering into interest rate swap agreements
     and cap agreements, the Company has recognized interest
     expense of $18,638, $83,833, and $187,875 for the years
     ended December 31, 1995, 1994 and 1993, respectively.  The
     impact of these hedging activities on the Company's weighted
     average borrowing rate was an increase of approximately
     0.03%, 0.26% and 0.44% for the years ended December 31,
     1995, 1994 and 1993, respectively.
     
     As of the years ended December 31, 1995 and 1994, there were
     no deferred gains and losses relating to terminated interest
     rate swap and interest rate cap agreements.
     
     The revolving credit feature of the Rio Bank Loan allows the
     Company to pay down and reborrow principal under the line of
     credit as the Company deems appropriate.  The Company
     utilized this ability by reborrowing $69 million on December
     30, 1994 and repaying $69 million on January 3, 1995.  The
     Company also reborrowed $10 million on December 29, 1995 and
     repaid $9 million on January 2, 1996 under the terms of the
     Rio Bank Loan.  During the third quarter of 1995, the
     Company used the net proceeds from the Subordinated Notes (defined 
     below) to reduce amounts outstanding under the Rio Bank Loan. 
     The Company had $165 million available under the Rio Bank Loan
     at December 31, 1995, while the Company's borrowing capacity
     under the Rio Bank Loan was fully utilized at December 31,
     1994.
     
                                 43

<PAGE>

     As of December 31, 1995, annual maturities of total notes
     and loans payable are as follows:

<TABLE>
<CAPTION>

  Year Ending                            
<S>                                 <C>
December 31, 1996                        $25,252
December 31, 1997                         25,252
December 31, 1998                         25,252
December 31, 1999                         25,252
December 31, 2000                         25,252
Thereafter                           110,075,757
                                    $110,202,017

</TABLE>

     Based upon the present operations of the Rio, internal
     projections of revenues and expenses, and other anticipated
     cash requirements of Rio Properties during 1996, the Company
     anticipates meeting required principal and interest payments
     under the Rio Bank Loan during 1996.
     
     The carrying values of assets included in the consolidated
     financial statements, which collateralize bank loans
     payable, are as follows:

                                         December 31,
                                      1995           1994


Building and improvements          $192,818,896   $137,005,432
Equipment, furniture and
   improvements                      68,500,267     43,108,873
Land and improvements                37,509,960     24,666,679
Construction in progress             17,173,483     38,521,773
                                   $316,002,606   $243,302,757
     
     
     On July 18, 1995, the Company entered into an agreement with
     Salomon Brothers Inc. and Montgomery Securities (the
     "Initial Purchasers") for the sale by the Company of
     $100 million in principal amount of the Company's
     10 5/8% Senior Subordinated Notes Due 2005 (the "Old
     Notes").  The Old Notes were purchased by the Initial
     Purchasers for resale to qualified institutional investors.
     The net proceeds from the sale of the Old Notes
     (approximately $96.7 million after the deduction of a 2.75%
     discount to the Initial Purchasers and offering expenses of
     approximately $0.5 million), borrowings under the Rio Bank
     Loan, cash on hand and cash from operations will be used to
     finance the Company's approximately $185 million Phase V
     Expansion.  Pending such use, the net proceeds were used to
     reduce amounts outstanding under the Rio Bank Loan.
     Pursuant to a registration agreement between the Company and
     the Initial Purchasers, the Company registered on Form S-4
     under the Securities Act of 1933 $100 million principal
     amount of 10 5/8% Senior Subordinated Notes Due 2005 (the
     "New Notes") which were exchanged for the Old Notes (the Old
     Notes and the New Notes are collectively referred to as the
     "Subordinated Notes").
     
                                 44

<PAGE>

     The Subordinated Notes were issued under an indenture (the
     "Indenture") dated July 21, 1995 among the Company, Rio
     Properties and IBJ Schroder Bank & Trust Company, as
     trustee.  The following summary of certain provisions of the
     Indenture does not purport to be complete and is subject to
     the provisions of the Indenture and the Subordinated Notes.
     Capitalized terms not otherwise defined have the same
     meanings assigned to them in the Indenture.
     
     The Subordinated Notes mature on July 15, 2005.  Interest
     payment dates under the Subordinated Notes are January 15
     and July 15, commencing January 15, 1996.  The Subordinated
     Notes are unconditionally guaranteed (the "Rio Guarantee")
     on a senior subordinated basis by Rio Properties.  The
     Subordinated Notes are subordinated in right of payment to
     all existing and future Senior Indebtedness (as defined in
     the Indenture) of the Company and are structurally
     subordinated to all existing and future indebtedness and
     other liabilities (including trade payables) of the
     Company's subsidiaries.  The Rio Guarantee is subordinated
     in right of payment to all existing and future Senior
     Indebtedness (as defined in the Indenture) of Rio Properties
     and is structurally subordinated to all existing and future
     indebtedness and other liabilities (including trade
     payables) of Rio Properties' subsidiaries.
     
     The Subordinated Notes may be redeemed at the option of the
     Company, in whole or in part, at any time on or after July
     15, 2000, at the redemption prices set forth in the
     Indenture, plus accrued and unpaid interest, if any, through
     the redemption date.  The Subordinated Notes will be
     redeemed from any holder or beneficial owner of the
     Subordinated Notes which is required to be found suitable
     and is not found suitable by the Nevada Commission.
     
     Upon a Change of Control of the Company (as defined in the
     Indenture), each holder of Subordinated Notes will have the
     right to require the Company to repurchase all or part of
     such holder's Subordinated Notes at a price equal to 101% of
     the aggregate principal amount thereof, plus accrued and
     unpaid interest, if any, to the date of repurchase.  The
     Company's obligation to repurchase the Subordinated Notes is
     guaranteed on a senior subordinated basis by Rio Properties.
     The Indenture contains certain covenants that, among other
     things, limit the ability of the Company and its Restricted
     Subsidiaries (as defined in the Indenture) to incur
     additional indebtedness, pay dividends or make other
     distributions, make investments, repurchase subordinated
     obligations or capital stock, create certain liens (except,
     among others, liens securing Senior Indebtedness), enter
     into certain transactions with affiliates, sell assets of
     the Company or its subsidiaries, issue or sell subsidiary
     stock, create or permit to exist restrictions on
     distributions from subsidiaries, or enter into certain
     mergers and consolidations.
     
                                 45

<PAGE>

7.   INCOME TAXES

     In February 1992, the Financial Accounting Standards Board
     issued SFAS 109 which supersedes previous pronouncements on
     accounting for income taxes and is effective for fiscal
     years commencing after December 15, 1992.  The Company
     adopted SFAS 109 in the first quarter of 1993 by reporting
     the effect of SFAS 109 as a cumulative effect of a change in
     accounting principle and not restating prior periods.  The
     effect of SFAS 109 recorded in January 1993 decreased net
     income as a non-cash, non-recurring cumulative effect of a
     change in accounting principle by an amount totaling
     $776,888.  It also reduced paid-in capital by an amount
     totaling $823,152.  This amount was charged directly against
     equity because it reflects the tax effect of SFAS 109 as it
     related to the gain on sale of assets to affiliates of the
     Company's largest stockholder in December 1991, which was
     also recorded directly to equity.
     
     The federal income tax provisions for the years ended
     December 31, 1995, 1994 and 1993 consist of the following:

<TABLE>
<CAPTION>

                                  1995          1994          1993

    <S>                          <C>           <C>           <C>
    Provision before tax rate                                   
     change and extraordinary
     items                       $10,707,135   $9,178,023    $6,671,872
    Additional provision due                                    
     to tax rate change (see   
     below)                             ---           ---       113,433  
    Provision before                                            
     extraordinary item           10,707,135    9,178,023     6,785,305  
    Income tax benefit from                                     
     extraordinary loss on                                      
     early retirement of debt           ---           ---      (130,700)
    Total Income Tax
     Provision                   $10,707,135   $9,178,023    $6,654,605   

</TABLE>

     The Revenue Reconciliation Act of 1993 raised the corporate
     income tax rate from 34% to 35%, retroactively to January 1,
     1993.  In accordance with the requirements of SFAS 109, the
     deferred income tax assets and liabilities were adjusted
     accordingly, resulting in a charge against income in the
     amount of $113,433.
     
                                 46

<PAGE>

     The following schedule reconciles the Company's effective
     tax rate to the statutory rate:
     
<TABLE>
<CAPTION>

                                            1995     1994     1993

     <S>                                    <C>     <C>      <C>
   Statutory rate                           35.0%   35.0%    35.0%
   Depreciation on premium allocated in                            
     Rio Partnership exchange                0.4%    0.5%     0.7%
   Disallowance for tax purposes of                                
     certain meals, travel and               1.5%    1.2%     0.4%
     entertainment expenses
   Other                                    (0.5)%  (0.2)%      ---
                                                                   
   Effective rate                            36.4%   36.5%    36.1%
     
</TABLE>

     During 1994, the Company utilized all remaining alternative
     minimum tax credit carryforwards.
     
     The Company's deferred tax assets (liabilities) at December
     31, 1995 consisted of the following:

<TABLE>
<CAPTION>

                                       Current      Non-Current

     <S>                              <C>           <C>
     Depreciation & amortization                    $(11,399,852)
     Deferred employee benefits       $370,122            ---
     Bad debt expense                  288,642            ---
     Other deferred tax assets,      
     net                                   ---           764,954
                                      $658,764      $(10,634,898)
</TABLE>

     The Company's deferred tax assets (liabilities) at
     December 31, 1994 consisted of the following:

<TABLE>
<CAPTION>

                                       Current      Non-Current

     <S>                               <C>           <C>
     Depreciation & amortization                     $(7,613,359)
     Deferred employee benefits        $ 391,927             ---
     Bad debt expense                    136,105             ---
     Other deferred tax assets,           34,231         101,082
       net
                                       $ 562,263     $(7,512,277)
                                                                
     
</TABLE>

     The current portion of the Company's net deferred tax assets
     is included on the Consolidated Balance Sheets under the
     heading "Prepaid Expenses and Other Current Assets."

     The Company has determined that it is probable that the full
     amount of the tax benefit from the deferred tax assets will
     be realized and therefore, has not recorded a valuation
     allowance to reduce the carrying value of the deferred tax
     assets.
     
                                 47

<PAGE>

8.   COMMITMENTS AND CONTINGENCIES

     In connection with the bank loan agreements, the Company has
     entered into agreements with certain key stockholders,
     directors and executive officers to facilitate borrowings by
     the Company.  These individuals personally guaranteed the
     previous bank loan made to Rio Properties in exchange for
     compensation of $1,250,000 upon the satisfaction of certain
     terms and conditions.  The first potential payment
     obligation of the Company of $250,000 commenced with the
     fiscal year ended December 31, 1990 and continued to
     December 31, 1994, with a two-year extension provision.  No
     amounts were due or paid arising out of the years ended
     December 31, 1990 or 1991.  The Company made $250,000
     payments in each of the four years ended December 31, 1995,
     1994, 1993, and 1992.  The Company anticipates paying the
     entire balance on or before December 31, 1996.

     Effective January 1, 1991, Rio Properties maintains an
     employee profit sharing plan for all employees who have
     accredited service.  Contributions to the plan are
     discretionary and cannot exceed amounts permitted under the
     Internal Revenue Code.  Contributions of $278,835, $215,039,
     and $109,701 have been authorized and charged to income for
     the years ended December 31, 1995, 1994, and 1993,
     respectively.

     In the normal course of business, the Company is involved
     with various negotiations and legal matters. In addition,
     Rio Properties is a potential defendant in various personal
     injury allegations. Management is of the opinion that the
     effect of these matters is not material to the consolidated
     financial statements.

9.   STOCKHOLDERS' EQUITY

     COMMON STOCK

     During 1995, the Company issued 198,300 shares of Common
     Stock at exercise prices ranging from $3.00 per share to
     $14.25 per share pursuant to options previously granted
     under the Company's Non-Statutory Stock Option Plan
     ("NSOP").
     
     During 1995, the Company repurchased 430,500 shares of
     Common Stock from time to time in the open market at a total
     cost of $5.4 million.  The repurchased shares of Common
     Stock were retired.
     
     During 1994, the Company issued 223,550 shares of Common
     Stock at exercise prices ranging from $3.00 per share to
     $15.625 per share pursuant to options previously granted
     under the Company's NSOP.

     On November 24, 1993, the Company sold in a public offering
     2,300,000 shares of Common Stock at a net price per share of
     $13.60.  The proceeds from the sale were received in
     November 1993.
     
                                 48

<PAGE>

     During 1993, the Company issued 247,000 shares of Common
     Stock at exercise prices ranging from $3.00 per share to
     $6.00 per share pursuant to options previously granted under
     the Company's NSOP.

     STOCK OPTIONS

     Key officers and employees are eligible to participate in
     the Company's NSOP.  The Company has granted 2,856,500
     options at exercise prices ranging from $3.00 to $15.625 per
     share.  As of December 31, 1995, 704,250 options had been
     exercised and 364,400 option had been forfeited, resulting
     in 1,787,850 options outstanding and 145,400 options
     available to be granted under the NSOP.

     The NSOP will terminate July 8, 1997, subject to the right
     of the Board of Directors to terminate the NSOP prior
     thereto.

     On September 5, 1991, the Company's Board of Directors
     adopted the 1991 Directors' Stock Option Plan, which was
     ratified by the Company's stockholders on May 16, 1992.  On
     March 28, 1995, the Company's Board of Directors amended the
     1991 Directors' Stock Option Plan, which was ratified by the
     Company's Stockholders on May 16, 1995, under which options
     to purchase up to 200,000 shares of Common Stock may be
     granted to non-employee directors. The option exercise price
     is 100% of the fair market value of the Common Stock on the
     date of grant.  As of December 31, 1995, 108,000 options had
     been granted at exercise prices ranging from $3.00 per share
     to $16.625 per share.  As of December 31, 1995, 20,000
     options had been exercised and 22,000 options had been
     forfeited, resulting in 66,000 options outstanding and
     114,000 options available to be granted under the Directors'
     Stock Option Plan.

10.  RELATED PARTY TRANSACTIONS

     The Company contracted with two affiliates of the Company's
     largest stockholder for the design and construction of a 41-
     story hotel tower containing approximately 1,000 suites (the
     "Phase V Expansion") for a total of $177,109,805.  As of
     December 31, 1995, the Company had capitalized $6,256,458 in
     connection with these contracts.  As of December 31, 1995,
     $4,151,712 has been accrued in connection with these
     construction and design contracts.
     
     The Company contracted with two affiliates of the Company's
     largest stockholder for the design and construction of an
     addition to an existing 21-story hotel tower of 141
     additional suites (the "Phase IV Expansion") for a total of
     $18,848,258.  As of December 31, 1995, the Company had
     capitalized $16,565,576 in connection with these contracts.
     As of December 31, 1995, $1,663,182 had been accrued in
     connection with these construction and design contracts.
     
     The Company contracted with two affiliates of the Company's
     largest stockholder for the design and construction of a 21-
     story hotel tower containing 549 suites (the "Phase III

                                  49     
                                  
<PAGE>

     Expansion") for a total of $64,166,368.  As of December 31,
     1995 and 1994, the Company had capitalized $62,026,368 and
     $37,241,468 in connection with these contracts.  As of
     December 31, 1995 and 1994, $372,370 and $10,026,210 had
     been accrued in connection with these contracts.

     In 1993, the Company contracted with two affiliates of the
     Company's largest stockholder for the design and
     construction of a 21-story hotel tower containing 437 suites
     (the "Tower Expansion") and an expansion of the Rio's public
     area (the "Eastside Expansion").  The two contracts were in
     amounts not to exceed $57,557,093.  As of December 31, 1994,
     all amounts due in connection with these contracts had been
     capitalized and paid.

     In December 1991, the Company sold non-Rio real estate to an
     affiliate of the Company's largest stockholder.  In April
     1994, the affiliated entity sold the real estate to a non-
     related party.  Pursuant to the terms of the sales
     agreement, the Company was entitled to a portion of the
     sales proceeds which equaled $966,510, net of expenses.
     
     The Company reimbursed an affiliate of the Company's largest
     stockholder for certain expenses advanced on behalf of or
     supplied to the Company during the years ended December 31,
     1995 and December 31, 1993 of approximately $878,428 and
     $162,425, respectively.  Nominal amounts were paid by the
     Company to the affiliate for similar purposes during 1994.
     Such amounts were generally billed to the Company at the
     affiliate's cost.

     Two director/officers of the Company are associated with
     affiliated entities which render various architectural and
     construction services for the Company. The Company paid
     these entities, in the aggregate, approximately $51,018,430,
     $50,416,348, and $44,567,088 during the years ended
     December 31, 1995, 1994, and 1993, respectively, for their
     services.

     Entities in which a director of the Company is the principal
     stockholder and the executive officer received commissions
     from the Company totaling approximately $158,789, $124,912
     and $90,325 for the years ended December 31, 1995, 1994, and
     1993, respectively, arising out of the acquisition of
     various insurance coverages by the Company.

     The Company believes that the transactions described above
     are on terms at least as favorable as would have been
     obtained from non-related parties.
     
11.  DEBT GUARANTEE
     
     Summarized financial information is provided below for Rio
     Properties, the Company's principal wholly-owned operating
     subsidiary, as sole guarantor to the Company's $100,000,000
     10 5/8% Senior Subordinated Notes Due 2005.  The
     Subordinated Notes are fully and unconditionally guaranteed
     by Rio Properties and are subordinated to all existing and
     future indebtedness and other liabilities (including trade
     payables) of the Company's subsidiaries.
     
                                 50

<PAGE>

     Summarized financial statements of Rio Properties have been
     prepared since the assets, pre-tax income and parents' net
     investment in the non-guarantor subsidiaries on an
     individual and combined basis are inconsequential.  In
     addition, the Company's operations or assets other than its
     investment in its subsidiaries are inconsequential.  The
     difference in net equity between the Company and Rio
     Properties is principally a result of the Company's purchase
     in 1990 and 1992 of minority interests in a subsidiary,
     resulting in the payment of premiums of approximately $13.7
     million and $1.3 million, respectively.  The premiums were
     allocated by the Company, based on fair market values, among
     land, building and equipment, furniture and improvements.
     
<TABLE>
<CAPTION>
     
                                   For the Year Ended December 31,
                                 1995           1994           1993

     <S>                      <C>            <C>           <C>
     Current Assets           $29,995,415     85,120,465    62,303,414
     Non-Current Assets       262,320,009    199,788,372   138,644,090
     Current Liabilities       33,216,257     44,662,313    29,292,301
     Non-Current Liabilities  110,176,765    110,146,869    56,875,753
     Revenues                 192,537,954    146,299,304   109,981,585
     Operating Profit          37,138,205     25,726,349    20,265,334
     Income before income
       taxes                   29,451,596     23,925,361    18,107,197
     Net Income                18,733,318     15,174,014    10,745,469
     
</TABLE>

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
         ACCOUNTING AND FINANCIAL DISCLOSURE

     None

PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     This information is incorporated by reference from the
Company's Proxy Statement to be filed with the Commission in
connection with the Company's annual meeting of stockholders on
May 23, 1996.

ITEM 11.  EXECUTIVE COMPENSATION

     This information is incorporated by reference from the
Company's Proxy Statement to be filed with the Commission in
connection with the Company's annual meeting of stockholders on
May 23, 1996.

                                51

<PAGE>

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
          MANAGEMENT

     This information is incorporated by reference from the
Company's Proxy Statement to be filed with the Commission in
connection with the Company's annual meeting of stockholders on
May 23, 1996.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     This information is incorporated by reference from the
Company's Proxy Statement to be filed with the Commission in
connection with the Company's annual meeting of stockholders on
May 23, 1996.

                                 52

<PAGE>

PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
          FORM 8-K

(a)  1.   Financial Statements

          Included in Part II of this report:

          Consolidated Balance Sheets at December 31, 1995
          and December 31, 1994.

          Consolidated Statements of Income for the Years Ended
          December 31, 1995, 1994 and 1993.

          Consolidated Statements of Stockholders' Equity for the
          Years Ended December 31, 1995, 1994 and 1993.

          Consolidated Statements of Cash Flows for the Years Ended
          December 31, 1995, 1994 and 1993.

          Notes to Consolidated Financial Statements

      2.  Financial Statement Schedules

          Included in Part IV of this report:

          Schedule III - Condensed Financial Information of
          Registrant

          Schedule VIII - Valuation and Qualifying Accounts

          Other schedules are omitted because of the absence of conditions
          under which they are required or because the required information
          is given in the financial statements or notes thereto.

     3.   Exhibits

Number  Exhibit Description                                      
                                                                 
3.01    Amended and Restated Articles of Incorporation of Rio    
        Hotel & Casino, Inc. filed July 19, 1994, are
        incorporated herein by reference from the Company's (SEC
        File No. 0-13760) Report on Form 10-Q for the Quarter
        Ended June 30, 1994, Part II, Item 6(a), Exhibit 4.01.
                                                                 
3.02    Amended and Restated Bylaws of Rio Hotel & Casino, Inc., 
        certified March 3, 1993, are incorporated herein by
        reference from the Company's (SEC File No. 0-13760)
        Report on Form 10-K for the Year Ended December 31,
        1992, Part IV, Item 14, Exhibit 4.02.

                                 53

<PAGE>

4.01    Specimen common stock certificate for the common stock   
        of Rio Hotel & Casino, Inc. is incorporated herein by
        reference from the Company's (SEC File No. 333-869)
        Registration Statement on Form S-3, filed on
        February 12, 1996, Part II, Item 15, Exhibit 4.03.
                                                                 
4.02    Agreement and Plan of Exchange by and between Rio        
        Hotel & Casino, Inc., a Nevada corporation, and Rio
        Properties, Inc., a Nevada corporation, dated August 14,
        1992, is incorporated herein by reference from the
        Company's (SEC File No. 33-51092) Registration Statement
        on Form S-3 filed on August 24, 1992, Part II, Item 16,
        Exhibit 2.01.
                                                                 
4.03    Form of Subscription and Exchange Agreement between Rio  
        Properties, Inc., MarCor Resorts, Inc., and subscriber
        is incorporated herein by reference from the Company's
        (SEC File No. 33-51092) Registration Statement on
        Form S-3 filed on August 24, 1992, Part II, Item 16,
        Exhibit 2.02.
                                                                 
4.04    Rio Hotel & Casino, Inc. Non-Statutory Stock Option      
        Plan, as amended September 5, 1991, as amended
        February 28, 1992 (to reflect change in Company name)
        and as amended June 22, 1993, is incorporated herein by
        reference from the Company's (SEC File No. 33-38752)
        Registration Statement on Form S-8 filed on October 5,
        1993, Part II, Item 8, Exhibit 4.04.
                                                                 
4.05    Rio Hotel & Casino, Inc. Directors' Stock Option Plan As 
        Amended February 28, 1992 (to reflect change in Company
        name only) is incorporated herein by reference from the
        Company's (SEC File No. 2-88147) Report on Form 10-K for
        the Year Ended December 31, 1991, Part IV, Item 14(c),
        Exhibit 4.07.
                                                                 
4.06    Rio Suite Hotel & Casino Employee Retirement Savings     
        Plan Trust Agreement dated February 11, 1991; First
        Amendment to the Rio Suite Hotel & Casino Employee
        Retirement Savings Plan dated March 20, 1992, effective
        April 1, 1992; Second Amendment to the Rio Suite Hotel &
        Casino Employee Retirement Savings Plan dated
        March 20, 1992, effective April 1, 1992; Third Amendment
        to the Rio Suite Hotel & Casino Employee Retirement
        Savings Plan dated December 14, 1992, effective August
        15, 1992, and Rio Suite Hotel & Casino Employee
        Retirement Savings Plan, Participant Loan Program dated
        March 19, 1992 are incorporated herein by reference from
        the Company's (SEC File No. 33-56860) Registration
        Statement on Form S-8 filed January 8, 1993, Part II,
        Item 8, Exhibit 4.11; Rio Suite Hotel & Casino
        Employment Retirement Savings Plan dated February 21,
        1991 is incorporated herein by reference from the
        Company's (SEC File No. 33-56860) Registration Statement
        on Form S-8 filed February 3, 1993, Part II, Item 8,
        Exhibit 4.11; Fourth Amendment to the Rio Suite Hotel &
        Casino Employee 
        
                                 54

<PAGE>        

        Retirement Savings Plan dated April 30, 1993, effective 
        July 1, 1993; Fifth Amendment to the Rio Suite Hotel & 
        Casino Employee Retirement Savings Plan dated 
        August 17, 1993, effective July 1, 1993; Sixth
        Amendment to the Rio Suite Hotel & Casino Employee
        Retirement Savings Plan dated October 27, 1993,
        effective October 25, 1993; Seventh Amendment to the Rio
        Suite Hotel & Casino Employee Retirement Savings Plan
        Trust Agreement dated and effective December 16, 1993;
        and Eighth Amendment to the Rio Suite Hotel & Casino
        Employee Retirement Savings Plan dated May 3, 1994,
        effective May 1, 1994 are incorporated herein by
        reference from the Company's (SEC File No. 0-13760)
        Report on Form 10-Q for the Quarter Ended June 30, 1994,
        Part II, Item 6(a), Exhibit 4.03; Ninth Amendment to the
        Rio Suite Hotel & Casino Employee Retirement Savings
        Plan dated August 26, 1994, effective August 25, 1994;
        Tenth Amendment to the Rio Suite Hotel & Casino Employee
        Retirement Savings Plan dated and effective January 1,
        1995; and Eleventh Amendment to the Rio Suite Hotel &
        Casino Employee Retirement Savings Plan dated and
        effective January 12, 1995 are incorporated herein by
        reference from the Company's (SEC File No. 0-13760)
        Report on Form 10-K for the Year Ended December 31,
        1994, Part IV, Item 14(c), Exhibit 4.08.
                                                                 
4.07    Rio Hotel & Casino, Inc. 1995 Long-Term Incentive Plan,  
        as adopted January 16, 1995 is incorporated herein by
        reference from the Company's (SEC File No. 0-13760)
        Report on Form 10-K for the Year Ended December 31,
        1994, Part IV, Item 14(c), Exhibit 4.09.
                                                                 
4.08    Credit Agreement among Bank of America National Trust    
        and Savings Association, as agent for itself and other
        financial institutions, as Lenders, and Rio Properties,
        Inc., as Borrower, dated July 15, 1993; Line A Note
        executed by Rio Properties, Inc., as Borrower, in favor
        of Bank of America National Trust and Savings
        Association, in the amount of $9,692,307.70 dated July
        15, 1993; Line A Note executed by Rio Properties, Inc.,
        as Borrower, in favor of Bank of America Nevada, in the
        amount of  $3,230,769.23, dated July 15, 1993; Line A
        Note executed by Rio Properties, Inc., as Borrower, in
        favor of Societe Generale, in the amount of
        $6,461,538.46, dated July 15, 1993; Line A Note executed
        by Rio Properties, Inc., as Borrower, in favor of NBD
        Bank, N.A., in the amount of $6,461,538.46, dated July
        15, 1993; Line A Note  executed by Rio Properties, Inc.,
        as Borrower, in favor of First Security Bank of Idaho,
        N.A., in the amount of $6,461,538.46, dated July 15,
        1993; Line A Note executed by Rio Properties, Inc., as
        Borrower, in favor of First Interstate Bank of Nevada,
        N.A., in the amount of $6,461,538.46, dated July 15,
        1993; Line A Note executed by Rio Properties, Inc., as
        Borrower, in favor of U.S. Bank of Nevada, in the amount
        of $3,230,769.23, dated July 15, 1993; Line B Note
        executed by Rio Properties, Inc., as Borrower, in favor
        of Bank of America National Trust and Savings
        Association, in the amount of $5,307,692.30 dated July
        15, 1993; Line B Note executed by Rio Properties, Inc.,
        as Borrower, in favor of Bank of America Nevada, in the
        amount of  
        
                                 55

<PAGE>        

        $1,769,230.77, dated July 15, 1993; Line B
        Note executed by Rio Properties, Inc., as Borrower, in
        favor of First Interstate Bank of Nevada, N.A., in the
        amount of $3,538,461.54, dated July 15, 1993; Line B
        Note executed by Rio Properties, Inc., as Borrower, in
        favor of First Security Bank of Idaho, N.A., in the
        amount of $3,538,461.54, dated July 15, 1993; Line B
        Note executed by Rio Properties, Inc., as Borrower, in
        favor of NBD Bank, N.A., in the amount of $3,538,461.54,
        dated July 15, 1993; Line B Note executed by Rio
        Properties, Inc., as Borrower, in favor of Societe
        Generale, in the amount of $3,538,461.54, dated July 15,
        1993; Line B Note executed by Rio Properties, Inc., as
        Borrower, in favor of U.S. Bank of Nevada, in the amount
        of $1,769,230.77, dated July 15, 1993; Revolving Note
        executed by Rio Properties, Inc., as Borrower, in favor
        of Bank of America National Trust and Savings
        Association, in the amount of $15,000,000, dated July
        15, 1993; Revolving Note executed by Rio Properties,
        Inc., as Borrower, in favor of Bank of America Nevada,
        in the amount of $5,000,000, dated July 15, 1993;
        Revolving Note executed by Rio Properties, Inc., as
        Borrower, in favor of First Interstate Bank of Nevada,
        N.A., in the amount of $10,000,000, dated July 15, 1993;
        Revolving Note executed by Rio Properties, Inc., as
        Borrower, in favor of First Interstate Bank of Idaho,
        N.A., in the amount of $10,000,000, dated July 15, 1993;
        Revolving Note executed by Rio Properties, Inc., as
        Borrower, in favor of NBD Bank, N.A., in the amount of
        $10,000,000, dated July 15, 1993; Revolving Note
        executed by Rio Properties, Inc., as Borrower, in favor
        of  Societe Generale, in the amount of $10,000,000,
        dated July 15, 1993; Revolving Note executed by Rio
        Properties, Inc., as Borrower, in favor of U.S. Bank of
        Nevada, in the amount of $5,000,000, dated July 15,
        1993; Security Agreement executed by Rio Properties,
        Inc., as Debtor, in favor of Bank of America National
        Trust and Savings Association, as agent for itself and
        other financial institutions, as Secured Party, dated
        July 15, 1993; Construction Deed of Trust With
        Assignment of Rents and Fixture   Filing among Rio
        Properties, Inc., as Trustor, Equitable Deed Company, as
        Trustee,   and Bank of America National Trust and
        Savings Association, as agent for itself and   the other
        financial institutions, as Beneficiary, dated July 15,
        1993; Unsecured   Indemnity Agreement executed by Rio
        Properties, Inc., as Indemnitor, in favor of Bank of
        America National Trust and Savings Association, as agent
        for itself and other  financial institutions, dated July
        15, 1993; Guaranty executed by Rio Hotel & Casino, Inc.,
        as Guarantor, in favor of Bank of America National Trust
        and Savings   Association, as agent for itself and other
        financial institutions, as Guaranteed Parties, dated
        July 15, 1993; and, Parent Guarantor Security Agreement
        by Rio Hotel & Casino, Inc., as Debtor, in favor of Bank
        of America National Trust and Savings Association, as
        agent for itself and other financial institutions, as
        Secured Party, dated July 15, 1993 are incorporated by
        reference from the Company's (SEC File No. 2-88147)
        Report on Form 8-K dated July 15, 1993, Item 7(c),
        Exhibit 28.01; First Amendment to Credit Agreement dated
        as of October 25, 1993 and Second Amendment and Waiver
        to Credit Agreement dated as of November 8, 1993 among
        Rio Properties, Inc., Bank of America National Trust and
        Savings Association, Bank of America Nevada, First
        Interstate Bank 
        
                                 56

<PAGE>        

        of Nevada, First Security Bank of Idaho,
        N.A., NBD Bank, N.A., Societe Generale, and U.S. Bank of
        Nevada are incorporated by reference from the Company's
        (SEC File No. 0-13760)  Report on Form 10-K for the Year
        Ended December 31, 1993, Part IV, Item 14(c), Exhibit
        4.09; Third Amendment to Credit Agreement dated as of
        April 15, 1994 among Rio Properties, Inc., Bank of
        America National Trust and Savings Association,  as
        Agent and as a Bank, Bank of America, Nevada, First
        Interstate Bank of Nevada, First Security Bank of Idaho,
        N.A, NBD Bank, N.A., Societe Generale, and U.S. Bank of
        Nevada; Memorandum of Amendments to Credit Agreement and
        Amendment to Construction Deed of Trust with Assignment
        of Rents and Fixture Filing dated as of May 9, 1994 by
        Rio Properties, Inc. and Bank of America National Trust
        and Savings Association are incorporated herein by
        reference from the Company's (SEC File No. 0-13760)
        Report on Form 10-Q for the Quarter Ended June 30, 1994,
        Part II, Item 6(a), Exhibit No. 4.02; and Fourth
        Amendment to Credit Agreement among Rio Properties,
        Inc., as Borrower, and Bank of America National Trust
        and Savings Association, First Interstate Bank of
        Nevada, First Security Bank of Idaho, N.A., NBD Bank,
        N.A., Societe Generale, Bank of America, Nevada, U.S.
        Bank of Nevada, Bank of Scotland and Midlantic Bank,
        N.A., as Lenders; and Second Memorandum of Amendment to
        Credit Agreement and Amendment to Construction Deed of
        Trust with Assignment of Rents and Fixture Filing
        between Borrower and Bank of America National Trust and
        Savings Association, as agent for Lenders, dated
        December 16, 1994 are incorporated herein by reference
        from the Company's (SEC File No. 0-13760) Report on Form
        8-K dated December 16, 1994, Item 7(c), Exhibit 10.01;
        Fifth Amendment to Credit Agreement dated as of March
        20, 1995, among Rio Properties, Inc., Bank of America
        National Trust and Savings Association, as Agent and as
        a Bank, First Interstate Bank  of Nevada, First Security
        Bank of Idaho, N.A., NBD Bank, N.A., Societe Generale,
        Bank of America Nevada, U.S. Bank of Nevada, Bank of
        Scotland and Midlantic Bank, N.A., as Banks, is
        incorporated herein by reference from the Company's (SEC
        File No. 0-13760) Report on Form 10-K for the Year Ended
        December 31, 1994, Part IV, Item 14(c), Exhibit 10.09;
        Sixth Amendment to Credit Agreement dated as of July 31,
        1995 among Rio Properties, Inc., Bank of America
        National Trust and Savings Association,  as Agent and as
        a Bank, and First Interstate Bank of Nevada, First
        Security Bank of Idaho, N.A., NBD Bank, N.A., Societe
        Generale, Bank of America Nevada, U.S. Bank of Nevada,
        Bank of Scotland, Midlantic Bank, N.A., and Bank of
        Hawaii, as Banks is incorporated herein by reference
        from the Company's (SEC File No. 0-13760) Report on Form
        8-K dated September 15, 1995, Item 7(c), Exhibit 4.01;
        and Seventh Amendment to Credit Agreement dated as of
        January 17, 1996 among Rio Properties, Inc., Bank of
        America National Trust and Savings Association, as Agent
        and as a Bank, and First Interstate Bank of Nevada,
        First Security Bank of Idaho, N.A., Societe Generale,
        Bank of America Nevada, U.S. Bank of Nevada, Bank of
        Scotland, Midlantic Bank, N.A., and Bank of Hawaii, as
        Banks.
                                                                 
4.09    Indenture dated as of July 21, 1995, among Rio Hotel &   
        Casino, Inc., Rio Properties, 
        
                                 57

<PAGE>        

        Inc. and IBJ Schroder Bank & Trust Company for the 
        Company's 105/8% Senior Subordinated Notes Due 2005 
        is incorporated herein by reference from the Company's 
        (SEC File No. 0-13760) Report on Form 8-K dated 
        July 18, 1995, Item 7(c), Exhibit 4.3.
                                                                 
4.10    Registration Agreement dated July 18, 1995 by Rio Hotel  
        & Casino, Inc. and accepted July 18, 1995 by Salomon
        Brothers Inc. and Montgomery Securities is incorporated
        herein by reference from the Company's (SEC File No. 0-
        13760) Report on Form 8-K dated July 18, 1995, Item
        7(c), Exhibit 4.2.
                                                                 
4.11    Form of Letter of Transmittal to IBJ Schroder Bank &     
        Trust Company as Exchange Agent for exchange of 105/8%
        Senior Subordinated Notes Due 2005 is incorporated
        herein by reference from the Company's (SEC File No. 33-
        62163) Registration Statement on Form S-4 filed August
        28, 1995, Part II, Item 21(a), Exhibit 4.14.
                                                                 
10.01   Agreement by and among MarCor Resorts Inc., Marnell      
        Corrao, Inc., Marnell Corrao Associates, Inc., MarCor
        Partnership, The Anthony A. Marnell II Revocable Living
        Trust dated June 16, 1982, Anthony A. Marnell II, Sandra
        J. Marnell, Barrett Family Revocable Living Trust dated
        December 18, 1981, James A. Barrett, Jr. and Maureen M.
        Barrett dated February 22, 1989, is incorporated herein
        by reference from the Company's (SEC File No. 0-13760)
        Annual Report on Form 10-K for the Year Ended December
        31, 1994, Part IV, Item 14(c), Exhibit 10.01; First
        Amendment to Agreement dated October 25, 1993 by and
        among Rio Hotel & Casino, Inc., and Marnell Corrao,
        Inc., Marnell Corrao Associates, Inc., MarCor
        Partnership, Anthony A. Marnell II, Barrett Family
        Revocable Living Trust dated December 18, 1981, James A.
        Barrett, Jr. and Maureen M. Barrett incorporated herein
        by reference from the Company's (SEC  File No. 0-13760)
        Report on Form 10-K for the Year Ended December 31,
        1993, Part IV, Item 14(c), Exhibit 10.01.
                                                                 
10.02   Interest Rate Swap Agreement dated as of July 28, 1993   
        between Rio Properties, Inc. and Bank of America
        National Trust and Savings Association is incorporated
        herein by reference from the Company's (SEC File No. 0-
        13760) Report on Form 10-K for the Year Ended December
        31, 1993, Part IV, Item 14(c), Exhibit 10.11.
                                                                 
10.03   Architectural Agreement entered into as of February 25,  
        1994 between Rio Hotel & Casino, Inc., as Owner, and
        Anthony A. Marnell II, Chartered, as Architect, is
        incorporated herein by reference from the Company's (SEC
        File No. 0-13760), Report on Form 10-K for the Year
        Ended December 31, 1993, Part IV, Item 14(c), Exhibit
        10.12.
                                                                 
10.04   Building Contract entered into as of February 25, 1994   
        between Marnell Corrao Associates, Inc., as General
        Contractor, and Rio Properties, Inc., as Owner, is


                                 58

<PAGE>

        incorporated herein by reference from the Company's (SEC
        File No. 0-13760) Report on Form 10-K for the Year Ended
        December 31, 1993, Part IV, Item 14(c), Exhibit 10.13.
                                                                 
10.05   Architectural Agreement entered into as of February 9,   
        1995 between Rio Hotel & Casino, Inc., as Owner, and
        Anthony A. Marnell, Chartered, as Architect, is
        incorporated herein by reference from the Company's (SEC
        File No. 0-13760) Annual Report on Form 10-K for the
        Year Ended December 31, 1994, Part IV, Item 14(c),
        Exhibit 10.08.
                                                                 
10.06   Building Contract entered into as of February 27, 1995   
        between Marnell Corrao Associates, Inc., as General
        Contractor, and Rio Properties, Inc., as Owner, is
        incorporated herein by reference from the Company's (SEC
        File No. 0-13760) Annual Report on Form 10-K for the
        Year Ended December 31, 1994, Part IV, Item 14(c),
        Exhibit 10.09.
                                                                 
10.07   Real Estate Purchase and Sale Agreement entered into as  
        of January 25, 1995 between Focus 2000, Inc., as Seller,
        and Rio Properties, Inc., as Buyer, is incorporated
        herein by reference from the Company's (SEC File No. 0-
        13760) Annual Report on Form 10-K for the Year Ended
        December 31, 1994, Part IV, Item 14(c), Exhibit 10.10.
                                                                 
10.08   Exchange Agreement entered into as of January 6, 1995    
        between Allied Building Materials, Cinderlane, Inc., and
        Rio Hotel & Casino, Inc. is incorporated herein by
        reference from the Company's (SEC File No. 0-13760)
        Annual Report on Form 10-K for the Year Ended December
        31, 1994, Part IV, Item 14(c), Exhibit 10.11.
                                                                 
10.09   Letter Agreement regarding Rate Cap Transaction dated    
        August 11, 1994 between Bank of America National Trust
        and Savings Association and Rio Properties, Inc. is
        incorporated herein by reference from the Company's (SEC
        File No. 0-13760) Annual Report on Form 10-K for the
        Year Ended December 31, 1994, Part IV, Item 14(c),
        Exhibit 10.12.
                                                                 
10.10   Architectural Agreement entered into as of July 27, 1995 
        between Rio Hotel & Casino, Inc., as Owner, and Anthony
        A. Marnell II, Chtd., as Architect, is incorporated
        herein by reference from the Company's (SEC File No.
        333-869) Registration Statement on Form S-3, filed on
        February 12, 1996, Part II, Item 16, Exhibit 10.10.
                                                                 
10.11   Building Contract entered into as of August 14, 1995 by  
        and between Marnell Corrao Associates, Inc., as General
        Contractor, and Rio Properties, Inc., as Owner, is 
        incorporated herein by reference from the Company's
        (SEC File No. 333-869) Registration Statement on 
        Form S-3, filed on February 12, 1996, Part II, Item 16,
        Exhibit 10.11.

                                 59

<PAGE>

21.01   List of the Company's subsidiaries.                      
                                                                 
23.01   Consent of Arthur Andersen LLP.                          
                                                                 
27.01   Financial Data Schedule.
                                                                 
(b)  Reports on Form 8-K

     No reports on Form 8-K were filed by the Company during the
quarter ended December 31, 1995.

                                 60

<PAGE>

<TABLE>                  
<CAPTION>
                      RIO HOTEL & CASINO, INC. AND SUBSIDIARIES
           SCHEDULE III - CONDENSED FINANCIAL INFORMATION OF REGISTRANT
                              RIO HOTEL & CASINO, INC.
                                  BALANCE SHEETS

                                                                  December 31,

                                                            1995                      1994
ASSETS
<S>                                                  <C>                    <C>
Current assets:
   Cash and cash equivalents                         $       85,885         $       35,635
   Accounts receivable                                          537                    887
   Accounts receivable from affiliates                        - - -              3,213,417
      Total current assets                                   86,422              3,249,939

Other assets:
   Investments in subsidiaries                          172,308,025            153,227,263
   Other, net                                             2,570,623              1,938,022
                                                        174,878,648            155,165,285
                                                     $  174,965,070         $  158,415,224

LIABILITIES AND STOCKHOLDERS' EQUITY                                           
Non-current liabilities due to subsidiaries          $   12,077,170         $   10,576,057

Stockholders' equity
   Common Stock, $0.01 par value;
      100,000,000 shares authorized;
      21,139,146 (1995) and 21,371,346 (1994)
      shares issued and outstanding                         211,392                213,714
   Additional paid-in capital                           113,520,158            117,214,582
   Retained earnings                                     49,156,350             30,410,871
      Total stockholders' equity                        162,887,900            147,839,167
                                                     $  174,965,070         $  158,415,224


                   See Accompanying Notes to Consolidated Financial Statements

</TABLE>
                                 61
<PAGE>

<TABLE>                     
<CAPTION>
                     RIO HOTEL & CASINO, INC. AND SUBSIDIARIES
            SCHEDULE III - CONDENSED FINANCIAL INFORMATION OF REGISTRANT
                             RIO HOTEL & CASINO, INC.
                              STATEMENTS OF INCOME


                                   For the Year Ended December 31,

                                         1995               1994              1993
<S>                                <C>                <C>               <C>
Revenues
   Interest Income                 $         1,144    $        2,537    $         6,724
   Other revenues                           - - -            966,510            393,537
   Subsidiary earnings                  18,994,335        15,267,612         10,592,688
                                        18,995,479        16,236,659         10,992,949

Costs and Expenses:
   General and administrative              250,000           270,250            343,577
                                           250,000           270,250            343,577
       Net income                  $    18,745,479    $   15,966,409    $    10,649,372



       See Accompanying Notes to Consolidated Financial Statements

</TABLE>
                                         62
<PAGE>

<TABLE>
<CAPTION>
                       RIO HOTEL & CASINO, INC. AND SUBSIDIARIES
             SCHEDULE III - CONDENSED FINANCIAL INFORMATION OF REGISTRANT
                               RIO HOTEL & CASINO, INC.
                               STATEMENTS OF CASH FLOW

                                                        For the Year Ended December 31,

                                                             1995                   1994

<S>                                                    <C>                    <C>        
Cash flows from operating activities:
  Net income                                           $   18,745,479         $   15,966,409

  Adjustments to reconcile net income to net
  cash provided by (used in) operating activities:
  Earnings from subsidiary investments                    (18,994,335)           (15,267,612)

  (Increase) decrease in assets:
    Receivables                                                   350                 64,113
    Prepaid expenses and other current assets                  - - -                  - - -
    Due from (to) subsidiaries                              4,715,730             (1,820,498)
    Other, net                                                 - - -                  - - -
  Decrease in liabilities:
    Accounts payable-trade                                     - - -                 (25,000)
  Net cash  provided by (used in) operating activities      4,467,224             (1,082,588)

Cash flows from investing activities:
  Investments in subisidiaries                                 - - -                 (14,390)
  Net cash used in investing activities                        - - -                 (14,390)

Cash flows from financing activities:
  Net proceeds from common stock issuance                     969,251              1,022,700
  Common stock offerings cost                                  - - -                (119,529)
  Repurchase of common stock                               (5,386,225)                - - -
  Net cash used in (provided by) financing activities      (4,416,974)               903,171
  Net increase (decrease) in cash and
    cash equivalents                                           50,250               (193,807)
  Cash and cash equivalents, beginning of period               35,635                229,442
  Cash and cash equivalents, end of period             $       85,885         $       35,635



                         See Accompanying Notes to Consolidated Financial Statements
</TABLE>

<TABLE>
<CAPTION>


                                RIO HOTEL & CASINO, INC. AND SUBSIDIARIES
                    SCHEDULE III - CONDENSED FINANCIAL INFORMATION OF REGISTRANT
                                        RIO HOTEL & CASINO, INC.
                                        STATEMENTS OF CASH FLOW

                                              For the Year Ended December 31,

                                                             1993

<S>                                                    <C> 
Cash flows from operating activities:
  Net income                                           $   10,649,392

  Adjustments to reconcile net income to net
  cash provided by (used in) operating activities:
  Earnings from subsidiary investments                    (10,592,688)

  (Increase) decrease in assets:
    Receivables                                               (79,821)
    Prepaid expenses and other current assets                  13,811
    Due from (to) subsidiaries                             (1,077,493)
    Other, net                                                  3,719
  Decrease in liabilities:
    Accounts payable-trade                                   (164,770)
  Net cash  provided by (used in) operating activities     (1,247,850)

Cash flows from investing activities:
  Investments in subisidiaries                            (30,730,375)
  Net cash used in investing activities                   (30,730,375)

Cash flows from financing activities:
  Net proceeds from common stock issuance                  32,506,200
  Common stock offerings cost                                (456,821)
  Repurchase of common stock                                   - - -
  Net cash used in (provided by) financing activities      32,049,379
  Net increase (decrease) in cash and
    cash equivalents                                           71,154
  Cash and cash equivalents, beginning of period              158,288
  Cash and cash equivalents, end of period             $      229,442

                See Accompanying Notes to Consolidated Financial Statements

</TABLE>

                                               63
<PAGE>

<TABLE>
<CAPTION>

            SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
                                 
                       December 31,    December 31,    December 31,
                           1995            1994            1993

<S>                     <C>             <C>             <C>
Cash payments made for                                       
 interest (net of
 amounts capitalized)   $   - - -       $   - - -       $   - - -
                                                             
     Supplemental Schedule of Non-Cash Investing and Financing
     Activities

</TABLE>

DECEMBER 31, 1995

     Tax benefit arising from the exercise of stock options
granted under the NSOP totaled $632,601.

DECEMBER 31, 1994

     Tax benefit arising from the exercise of stock options
granted under the NSOP totaled $886,132.

DECEMBER 31, 1993

     Additional costs of issuing Common Stock financed through
payables totaled $12,194.

     Costs of issuing Common Stock financed through payables
totaled $163,801.

     Tax benefit arising from the exercise of stock options
granted under the Company's NSOP totaled $1,120,823.

     Reduction of paid-in capital as a result of the
implementation of SFAS 109 totaled $832,152.  This amount was
charged directly against equity because it reflects the tax
effect of SFAS 109 as it related to the gain on sale of assets to
affiliates of the Company's largest stockholder in December 1991,
which was also recorded directly to equity (Note 10).

                                64
<PAGE>

<TABLE>               
<CAPTION>

               RIO HOTEL & CASINO, INC. AND SUBSIDIARIES
           SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS
              For the Three Years Ended December 31, 1995


<S>                                                   <C>
Balance, December 31, 1992                            $         263,232

        Additions charged to income                             523,491

        Accounts written off, less recoveries                  (407,360)



Balance, December 31, 1993                                      379,363

        Additions charged to income                             512,999

        Accounts written off, less recoveries                  (413,227)



Balance, December 31, 1994                                      479,135

        Additions charged to income                           1,002,463

        Accounts written off, less recoveries                  (656,906)



Balance, December 31, 1995                            $         824,692

</TABLE>
                                 65
<PAGE>

                           SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) 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.

                              RIO HOTEL & CASINO, INC.



March 15, 1996           By:        /S/ ROGER M. SZEPELAK
                                Roger M. Szepelak, Treasurer
                                and Chief Financial Officer

     Pursuant to the requirements of the Securities Exchange Act
of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on
the dates indicated.

<TABLE>
<CAPTION>

       SIGNATURE                       TITLE                       DATE
<S>                          <C>                               <C>
                                                           
/S/ ANTHONY A. MARNELL II    Chairman of the Board of          March 15, 1996
Anthony A. Marnell II        Directors and Chief Executive
                             Officer (Principal Executive
                             Officer)
                                                                  
/S/ JAMES A. BARRETT, JR.    President, Chief Operating        March 15, 1996
James A. Barrett, Jr.        Officer and Director

/S/ ROGER M. SZEPELAK        Treasurer and Chief Financial     March 15, 1996
Roger M. Szepelak            Officer (Principal Financial and
                             Accounting Officer)

/S/ JOHN A. STUART           Director                          March 15, 1996
John A. Stuart

/S/ THOMAS Y. HARTLEY        Director                          March 15, 1996
Thomas Y. Hartley

/S/ PETER M. THOMAS          Director                          March 15, 1996
Peter M. Thomas
       
</TABLE>

                                66
<PAGE>

<TABLE>
<CAPTION>
                          EXHIBIT INDEX
       
NUMBER  EXHIBIT DESCRIPTION                                      PAGE

<S>     <C>                                                      <C>
3.01    Amended and Restated Articles of Incorporation  of  Rio      
        Hotel   &  Casino,  Inc.  filed  July  19,  1994,   are
        incorporated  herein by reference  from  the  Company's
        (SEC  File  No. 0-13760) Report on Form  10-Q  for  the
        Quarter  Ended  June  30, 1994,  Part  II,  Item  6(a),
        Exhibit 4.01.
                                                                    
3.02    Amended  and  Restated Bylaws of Rio  Hotel  &  Casino,      
        Inc.,  certified March 3, 1993, are incorporated herein
        by  reference from the Company's (SEC File No. 0-13760)
        Report  on  Form 10-K for the Year Ended  December  31,
        1992, Part IV, Item 14, Exhibit 4.02.
                                                                    
4.01    Specimen common stock certificate for the common  stock      
        of  Rio Hotel & Casino, Inc. is incorporated herein  by
        reference  from  the Company's (SEC File  No.  333-869)
        Registration   Statement  on   Form   S-3,   filed   on
        February 12, 1996, Part II, Item 15, Exhibit 4.03.
                                                                    
4.02    Agreement  and  Plan  of Exchange by  and  between  Rio      
        Hotel  &  Casino, Inc., a Nevada corporation,  and  Rio
        Properties,   Inc.,   a   Nevada   corporation,   dated
        August  14,  1992, is incorporated herein by  reference
        from the Company's (SEC File No. 33-51092) Registration
        Statement  on  Form  S-3  filed  on  August  24,  1992,
        Part II, Item 16, Exhibit 2.01.
                                                                    
4.03    Form of Subscription and Exchange Agreement between Rio      
        Properties, Inc., MarCor Resorts, Inc., and  subscriber
        is  incorporated herein by reference from the Company's
        (SEC  File  No.  33-51092)  Registration  Statement  on
        Form  S-3  filed on August 24, 1992, Part II, Item  16,
        Exhibit 2.02.
                                                                    
4.04    Rio  Hotel  &  Casino, Inc. Non-Statutory Stock  Option      
        Plan,   as  amended  September  5,  1991,  as   amended
        February  28, 1992 (to reflect change in Company  name)
        and as amended June 22, 1993, is incorporated herein by
        reference  from the Company's (SEC File  No.  33-38752)
        Registration Statement on Form S-8 filed on October  5,
        1993, Part II, Item 8, Exhibit 4.04.
                                                                    
4.05    Rio  Hotel & Casino, Inc. Directors' Stock Option  Plan      
        As  Amended  February 28, 1992 (to  reflect  change  in
        Company  name only) is incorporated herein by reference
        from  the  Company's (SEC File No. 2-88147)  Report  on
        Form  10-K  for  the  Year  Ended  December  31,  1991,
        Part IV, Item 14(c), Exhibit 4.07.
                                                                    
4.06    Rio  Suite  Hotel & Casino Employee Retirement  Savings      
        Plan  Trust  Agreement dated February 11,  1991;  First
        Amendment  to  the  Rio Suite Hotel &  Casino  Employee
        Retirement Savings Plan dated March 20, 1992, effective
        April  1, 1992; Second Amendment to the Rio Suite Hotel
        & Casino Employee Retirement Savings Plan dated


                                67    
<PAGE>

        March   20,  1992,  effective  April  1,  1992;   Third      
        Amendment  to  the  Rio Suite Hotel &  Casino  Employee
        Retirement  Savings  Plan  dated  December  14,   1992,
        effective August 15, 1992, and Rio Suite Hotel & Casino
        Employee  Retirement  Savings  Plan,  Participant  Loan
        Program dated March 19, 1992 are incorporated herein by
        reference  from the Company's (SEC File  No.  33-56860)
        Registration  Statement on Form S-8  filed  January  8,
        1993, Part II, Item 8, Exhibit 4.11; Rio Suite Hotel  &
        Casino   Employment  Retirement  Savings   Plan   dated
        February  21, 1991 is incorporated herein by  reference
        from the Company's (SEC File No. 33-56860) Registration
        Statement on Form S-8 filed February 3, 1993, Part  II,
        Item 8, Exhibit 4.11; Fourth Amendment to the Rio Suite
        Hotel  & Casino Employee Retirement Savings Plan  dated
        April 30, 1993, effective July 1, 1993; Fifth Amendment
        to  the  Rio  Suite Hotel & Casino Employee  Retirement
        Savings  Plan dated August 17, 1993, effective July  1,
        1993;  Sixth Amendment to the Rio Suite Hotel &  Casino
        Employee  Retirement  Savings Plan  dated  October  27,
        1993, effective October 25, 1993; Seventh Amendment  to
        the  Rio  Suite  Hotel  &  Casino  Employee  Retirement
        Savings   Plan  Trust  Agreement  dated  and  effective
        December  16,  1993; and Eighth Amendment  to  the  Rio
        Suite  Hotel & Casino Employee Retirement Savings  Plan
        dated   May  3,  1994,  effective  May  1,   1994   are
        incorporated  herein by reference  from  the  Company's
        (SEC  File  No. 0-13760) Report on Form  10-Q  for  the
        Quarter  Ended  June  30, 1994,  Part  II,  Item  6(a),
        Exhibit 4.03; Ninth Amendment to the Rio Suite Hotel  &
        Casino  Employee Retirement Savings Plan  dated  August
        26, 1994, effective August 25, 1994; Tenth Amendment to
        the  Rio  Suite  Hotel  &  Casino  Employee  Retirement
        Savings  Plan dated and effective January 1, 1995;  and
        Eleventh  Amendment  to the Rio Suite  Hotel  &  Casino
        Employee  Retirement Savings Plan dated  and  effective
        January  12, 1995 are incorporated herein by  reference
        from  the  Company's (SEC File No. 0-13760)  Report  on
        Form  10-K  for the Year Ended December 31, 1994,  Part
        IV, Item 14(c), Exhibit 4.08.
                                                                    
4.07    Rio Hotel & Casino, Inc. 1995 Long-Term Incentive Plan,      
        as  adopted January 16, 1995 is incorporated herein  by
        reference  from  the Company's (SEC File  No.  0-13760)
        Report  on  Form 10-K for the Year Ended  December  31,
        1994, Part IV, Item 14(c), Exhibit 4.09.

4.08    Credit  Agreement among Bank of America National  Trust    74
        and  Savings Association, as agent for itself and other
        financial institutions, as Lenders, and Rio Properties,
        Inc.,  as  Borrower, dated July 15, 1993; Line  A  Note
        executed by Rio Properties, Inc., as Borrower, in favor
        of   Bank   of  America  National  Trust  and   Savings
        Association, in the amount of $9,692,307.70 dated  July
        15, 1993; Line A Note executed by Rio Properties, Inc.,
        as Borrower, in favor of Bank of America Nevada, in the
        amount  of $3,230,769.23, dated July 15, 1993;  Line  A
        Note executed by Rio Properties, Inc., as Borrower,  in
        favor   of   Societe  Generale,  in   the   amount   of
        $6,461,538.46,  dated  July  15,  1993;  Line  A   Note
        executed by Rio Properties, Inc., as Borrower, in favor
        of  NBD  Bank,  N.A., in the amount  of  $6,461,538.46,
        dated  July  15,  1993;  Line A Note  executed  by  Rio
        Properties,  Inc.,  as  Borrower,  in  favor  of  First
        Security Bank of Idaho,.

                                68
<PAGE>

        N.A.,  in  the amount of $6,461,538.46, dated July  15,      
        1993; Line A Note executed by Rio Properties, Inc.,  as
        Borrower, in favor of First Interstate Bank of  Nevada,
        N.A.,  in  the amount of $6,461,538.46, dated July  15,
        1993; Line A Note executed by Rio Properties, Inc.,  as
        Borrower,  in  favor of U.S. Bank  of  Nevada,  in  the
        amount  of $3,230,769.23, dated July 15, 1993;  Line  B
        Note executed by Rio Properties, Inc., as Borrower,  in
        favor  of  Bank of America National Trust  and  Savings
        Association, in the amount of $5,307,692.30 dated  July
        15, 1993; Line B Note executed by Rio Properties, Inc.,
        as Borrower, in favor of Bank of America Nevada, in the
        amount  of $1,769,230.77, dated July 15, 1993;  Line  B
        Note executed by Rio Properties, Inc., as Borrower,  in
        favor of First Interstate Bank of Nevada, N.A., in  the
        amount  of $3,538,461.54, dated July 15, 1993;  Line  B
        Note executed by Rio Properties, Inc., as Borrower,  in
        favor  of  First Security Bank of Idaho, N.A.,  in  the
        amount  of $3,538,461.54, dated July 15, 1993;  Line  B
        Note executed by Rio Properties, Inc., as Borrower,  in
        favor   of   NBD   Bank,  N.A.,  in   the   amount   of
        $3,538,461.54,  dated  July  15,  1993;  Line  B   Note
        executed by Rio Properties, Inc., as Borrower, in favor
        of  Societe  Generale, in the amount of  $3,538,461.54,
        dated  July  15,  1993;  Line B Note  executed  by  Rio
        Properties, Inc., as Borrower, in favor of U.S. Bank of
        Nevada, in the amount of $1,769,230.77, dated July  15,
        1993;  Revolving Note executed by Rio Properties, Inc.,
        as Borrower, in favor of Bank of America National Trust
        and  Savings Association, in the amount of $15,000,000,
        dated  July  15, 1993; Revolving Note executed  by  Rio
        Properties,  Inc., as Borrower, in  favor  of  Bank  of
        America Nevada, in the amount of $5,000,000, dated July
        15,  1993;  Revolving Note executed by Rio  Properties,
        Inc., as Borrower, in favor of First Interstate Bank of
        Nevada, N.A., in the amount of $10,000,000, dated  July
        15,  1993;  Revolving Note executed by Rio  Properties,
        Inc., as Borrower, in favor of First Interstate Bank of
        Idaho,  N.A., in the amount of $10,000,000, dated  July
        15,  1993;  Revolving Note executed by Rio  Properties,
        Inc.,  as Borrower, in favor of NBD Bank, N.A., in  the
        amount  of  $10,000,000, dated July 15, 1993; Revolving
        Note executed by Rio Properties, Inc., as Borrower,  in
        favor   of   Societe  Generale,  in   the   amount   of
        $10,000,000,  dated  July  15,  1993;  Revolving   Note
        executed by Rio Properties, Inc., as Borrower, in favor
        of  U.S.  Bank of Nevada, in the amount of  $5,000,000,
        dated July 15, 1993; Security Agreement executed by Rio
        Properties,  Inc.,  as Debtor,  in  favor  of  Bank  of
        America  National  Trust  and Savings  Association,  as
        agent  for itself and other financial institutions,  as
        Secured  Party, dated July 15, 1993; Construction  Deed
        of  Trust  With Assignment of Rents and Fixture  Filing
        among Rio Properties, Inc., as Trustor, Equitable  Deed
        Company, as Trustee, and Bank of America National Trust
        and  Savings Association, as agent for itself  and  the
        other  financial  institutions, as  Beneficiary,  dated
        July  15,  1993; Unsecured Indemnity Agreement executed
        by  Rio  Properties, Inc., as Indemnitor, in  favor  of
        Bank of America National Trust and Savings Association,
        as  agent  for itself and other financial institutions,
        dated  July 15, 1993; Guaranty executed by Rio Hotel  &
        Casino, Inc., as Guarantor, in favor of Bank of America
        National  Trust and Savings Association, as  agent  for
        itself  and other financial institutions, as Guaranteed
        Parties,  dated  July 15, 1993; and,  Parent  Guarantor
        Security Agreement by Rio Hotel & Casino, Inc., as

                                69
<PAGE>

        Debtor, in favor of Bank of America National Trust  and      
        Savings  Association,  as agent for  itself  and  other
        financial  institutions, as Secured Party,  dated  July
        15,   1993  are  incorporated  by  reference  from  the
        Company's  (SEC File No. 2-88147) Report  on  Form  8-K
        dated  July  15, 1993, Item 7(c), Exhibit 28.01;  First
        Amendment  to Credit Agreement dated as of October  25,
        1993   and  Second  Amendment  and  Waiver  to   Credit
        Agreement  dated  as  of November  8,  1993  among  Rio
        Properties,  Inc., Bank of America National  Trust  and
        Savings  Association,  Bank of  America  Nevada,  First
        Interstate  Bank  of  Nevada, First  Security  Bank  of
        Idaho, N.A., NBD Bank, N.A., Societe Generale, and U.S.
        Bank  of Nevada are incorporated by reference from  the
        Company's  (SEC File No. 0-13760) Report on  Form  10-K
        for  the  Year Ended December 31, 1993, Part  IV,  Item
        14(c),   Exhibit  4.09;  Third  Amendment   to   Credit
        Agreement  dated  as  of  April  15,  1994  among   Rio
        Properties,  Inc., Bank of America National  Trust  and
        Savings  Association, as Agent and as a Bank,  Bank  of
        America, Nevada, First Interstate Bank of Nevada, First
        Security  Bank  of Idaho, N.A, NBD Bank, N.A.,  Societe
        Generale,  and  U.S.  Bank  of  Nevada;  Memorandum  of
        Amendments   to  Credit  Agreement  and  Amendment   to
        Construction Deed of Trust with Assignment of Rents and
        Fixture  Filing  dated  as  of  May  9,  1994  by   Rio
        Properties, Inc. and Bank of America National Trust and
        Savings   Association   are  incorporated   herein   by
        reference  from  the Company's (SEC File  No.  0-13760)
        Report  on  Form  10-Q for the Quarter Ended  June  30,
        1994,  Part II, Item 6(a), Exhibit No. 4.02; and Fourth
        Amendment  to  Credit Agreement among  Rio  Properties,
        Inc.,  as Borrower, and Bank of America National  Trust
        and  Savings  Association,  First  Interstate  Bank  of
        Nevada,  First Security Bank of Idaho, N.A., NBD  Bank,
        N.A.,  Societe Generale, Bank of America, Nevada,  U.S.
        Bank  of  Nevada, Bank of Scotland and Midlantic  Bank,
        N.A., as Lenders; and Second Memorandum of Amendment to
        Credit Agreement and Amendment to Construction Deed  of
        Trust  with  Assignment  of Rents  and  Fixture  Filing
        between Borrower and Bank of America National Trust and
        Savings  Association,  as  agent  for  Lenders,   dated
        December  16, 1994 are incorporated herein by reference
        from  the  Company's (SEC File No. 0-13760)  Report  on
        Form  8-K  dated December 16, 1994, Item 7(c),  Exhibit
        10.01; Fifth Amendment to Credit Agreement dated as  of
        March  20,  1995, among Rio Properties, Inc.,  Bank  of
        America  National  Trust  and Savings  Association,  as
        Agent  and as a Bank, First Interstate Bank of  Nevada,
        First  Security  Bank of Idaho, N.A., NBD  Bank,  N.A.,
        Societe Generale, Bank of America Nevada, U.S. Bank  of
        Nevada,  Bank of Scotland and Midlantic Bank, N.A.,  as
        Banks,  is  incorporated herein by reference  from  the
        Company's  (SEC File No. 0-13760) Report on  Form  10-K
        for  the  Year Ended December 31, 1994, Part  IV,  Item
        14(c),   Exhibit  10.09;  Sixth  Amendment  to   Credit
        Agreement   dated  as  of  July  31,  1995  among   Rio
        Properties,  Inc., Bank of America National  Trust  and
        Savings Association, as Agent and as a Bank, and  First
        Interstate  Bank  of  Nevada, First  Security  Bank  of
        Idaho, N.A., NBD Bank, N.A., Societe Generale, Bank  of
        America  Nevada, U.S. Bank of Nevada, Bank of Scotland,
        Midlantic Bank, N.A., and Bank of Hawaii, as  Banks  is
        incorporated  herein by reference  from  the  Company's
        (SEC  File  No.  0-13760)  Report  on  Form  8-K  dated
        September  15,  1995,  Item  7(c),  Exhibit  4.01;  and
        Seventh

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<PAGE>

        Amendment  to Credit Agreement dated as of January  17,      
        1996  among  Rio  Properties,  Inc.,  Bank  of  America
        National Trust and Savings Association, as Agent and as
        a  Bank,  and  First Interstate Bank of  Nevada,  First
        Security Bank of Idaho, N.A., Societe Generale, Bank of
        America  Nevada, U.S. Bank of Nevada, Bank of Scotland,
        Midlantic Bank, N.A., and Bank of Hawaii, as Banks
                                                                    
4.09    Indenture dated as of July 21, 1995, among Rio Hotel  &      
        Casino,  Inc.,  Rio Properties, Inc. and  IBJ  Schroder
        Bank  &  Trust Company for the Company's 105/8%  Senior
        Subordinated Notes Due 2005 is incorporated  herein  by
        reference  from  the Company's (SEC File  No.  0-13760)
        Report  on  Form  8-K dated July 18, 1995,  Item  7(c),
        Exhibit 4.3.
                                                                    
4.10    Registration Agreement dated July 18, 1995 by Rio Hotel      
        &  Casino,  Inc. and accepted July 18, 1995 by  Salomon
        Brothers Inc. and Montgomery Securities is incorporated
        herein by reference from the Company's (SEC File No. 0-
        13760)  Report  on Form 8-K dated July 18,  1995,  Item
        7(c), Exhibit 4.2.
                                                                    
4.11    Form  of Letter of Transmittal to IBJ Schroder  Bank  &      
        Trust  Company as Exchange Agent for exchange of 105/8%
        Senior  Subordinated  Notes Due  2005  is  incorporated
        herein by reference from the Company's (SEC File No. 33-
        62163)  Registration Statement on Form S-4 filed August
        28, 1995, Part II, Item 21(a), Exhibit 4.14.
                                                                    
10.01   Agreement  by  and among MarCor Resorts  Inc.,  Marnell      
        Corrao,  Inc., Marnell Corrao Associates, Inc.,  MarCor
        Partnership, The Anthony A. Marnell II Revocable Living
        Trust  dated  June  16, 1982, Anthony  A.  Marnell  II,
        Sandra  J.  Marnell,  Barrett Family  Revocable  Living
        Trust  dated  December 18, 1981, James A. Barrett,  Jr.
        and  Maureen  M. Barrett dated February  22,  1989,  is
        incorporated  herein by reference  from  the  Company's
        (SEC  File No. 0-13760) Annual Report on Form 10-K  for
        the  Year Ended December 31, 1994, Part IV, Item 14(c),
        Exhibit  10.01;  First  Amendment  to  Agreement  dated
        October 25, 1993 by and among Rio Hotel & Casino, Inc.,
        and  Marnell  Corrao, Inc., Marnell Corrao  Associates,
        Inc.,  MarCor  Partnership,  Anthony  A.  Marnell   II,
        Barrett  Family  Revocable Living Trust dated  December
        18,  1981, James A. Barrett, Jr. and Maureen M. Barrett
        incorporated  herein by reference  from  the  Company's
        (SEC File No. 0-13760) Report on Form 10-K for the Year
        Ended  December 31, 1993, Part IV, Item 14(c),  Exhibit
        10.01.
                                                                    
10.02   Interest Rate Swap Agreement dated as of July 28,  1993      
        between  Rio  Properties,  Inc.  and  Bank  of  America
        National  Trust and Savings Association is incorporated
        herein by reference from the Company's (SEC File No. 0-
        13760)  Report on Form 10-K for the Year Ended December
        31, 1993, Part IV, Item 14(c), Exhibit 10.11.
                                                                    
10.03   Architectural Agreement entered into as of February 25,      
        1994  between Rio Hotel & Casino, Inc., as  Owner,  and
        Anthony A. Marnell II, Chartered, as Architect, is

                                71
<PAGE>

        incorporated  herein by reference  from  the  Company's      
        (SEC  File  No. 0-13760), Report on Form 10-K  for  the
        Year  Ended  December 31, 1993, Part  IV,  Item  14(c),
        Exhibit 10.12.
                                                                    
10.04   Building Contract entered into as of February 25,  1994      
        between  Marnell  Corrao Associates, Inc.,  as  General
        Contractor,  and  Rio Properties, Inc.,  as  Owner,  is
        incorporated  herein by reference  from  the  Company's
        (SEC File No. 0-13760) Report on Form 10-K for the Year
        Ended  December 31, 1993, Part IV, Item 14(c),  Exhibit
        10.13.
                                                                    
10.05   Architectural Agreement entered into as of February  9,      
        1995  between Rio Hotel & Casino, Inc., as  Owner,  and
        Anthony   A.  Marnell,  Chartered,  as  Architect,   is
        incorporated  herein by reference  from  the  Company's
        (SEC  File No. 0-13760) Annual Report on Form 10-K  for
        the  Year Ended December 31, 1994, Part IV, Item 14(c),
        Exhibit 10.08.
                                                                    
10.06   Building Contract entered into as of February 27,  1995      
        between  Marnell  Corrao Associates, Inc.,  as  General
        Contractor,  and  Rio Properties, Inc.,  as  Owner,  is
        incorporated  herein by reference  from  the  Company's
        (SEC  File No. 0-13760) Annual Report on Form 10-K  for
        the  Year Ended December 31, 1994, Part IV, Item 14(c),
        Exhibit 10.09.
                                                                    
10.07   Real Estate Purchase and Sale Agreement entered into as      
        of  January  25,  1995  between Focus  2000,  Inc.,  as
        Seller,   and  Rio  Properties,  Inc.,  as  Buyer,   is
        incorporated  herein by reference  from  the  Company's
        (SEC  File No. 0-13760) Annual Report on Form 10-K  for
        the  Year Ended December 31, 1994, Part IV, Item 14(c),
        Exhibit 10.10.
                                                                    
10.08   Exchange Agreement entered into as of January  6,  1995      
        between  Allied  Building Materials, Cinderlane,  Inc.,
        and Rio Hotel & Casino, Inc. is incorporated herein  by
        reference  from  the Company's (SEC File  No.  0-13760)
        Annual  Report on Form 10-K for the Year Ended December
        31, 1994, Part IV, Item 14(c), Exhibit 10.11.
                                                                    
10.09   Letter  Agreement regarding Rate Cap Transaction  dated      
        August 11, 1994 between Bank of America National  Trust
        and  Savings  Association and Rio Properties,  Inc.  is
        incorporated  herein by reference  from  the  Company's
        (SEC  File No. 0-13760) Annual Report on Form 10-K  for
        the  Year Ended December 31, 1994, Part IV, Item 14(c),
        Exhibit 10.12.
                                                                    
10.10   Architectural  Agreement entered into as  of  July  27,      
        1995  between Rio Hotel & Casino, Inc., as  Owner,  and
        Anthony   A.  Marnell  II,  Chtd.,  as  Architect,   is
        incorporated  herein by reference  from  the  Company's
        (SEC  File No. 333-869) Registration Statement on  Form
        S-3,  filed  on February 12, 1996, Part  II,  Item  16,
        Exhibit 10.10.

                                72
<PAGE>

10.11   Building Contract entered into as of August 14, 1995 by      
        and between Marnell Corrao
        Associates,  Inc.,  as  General  Contractor,  and   Rio
        Properties, Inc., as Owner, is incorporated  herein  by
        reference  from  the Company's (SEC File  No.  333-869)
        Registration   Statement  on   Form   S-3,   filed   on
        February 12, 1996, Part II, Item 16, Exhibit 10.11.
                                                                    
21.01   List of the Company's subsidiaries.                        91
                                                                    
23.01   Consent of Arthur Andersen LLP.                            93
                                                                    
27.01   Financial Data Schedule                                    95
                                                                    
</TABLE>

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