EXHIBIT 10.40.2
                                

                                                                 
                                                                 
                    AMENDMENT AGREEMENT NO. 2
                                
                                
     AMENDMENT AGREEMENT NO. 2 dated as of October 31, 1998 (this
"Amendment")  by  and  among  (a)  Filene's  Basement,  Inc.,   a
Massachusetts corporation (the "Borrower"), (b) Filene's Basement
Corp.,   a  Massachusetts  corporation  (the  "Guarantor"),   (c)
BankBoston,  N.A. (f/k/a The First National Bank of  Boston)  and
the other lending institutions listed on Schedule 1 to the Credit
Agreement  (as hereinafter defined) (collectively, the  "Banks"),
(d)  BankBoston, N.A. (f/k/a The First National Bank of  Boston),
as  agent  for  itself and the Banks (the "Agent"), amending  the
Amended  and  Restated Revolving Credit and Term  Loan  Agreement
dated as of January 30, 1998 (as amended and in effect from  time
to   time,  the  "Credit  Agreement")  among  the  Borrower,  the
Guarantor,  the  Banks  and the Agent.   Capitalized  terms  used
herein  without other definition shall have the meanings assigned
to them in the Credit Agreement.

      WHEREAS,  upon  the  terms and subject  to  the  conditions
contained herein, the Borrower, the Guarantor, the Agent and  the
Majority  Banks wish to amend certain provisions  of  the  Credit
Agreement;

      NOW,  THEREFORE, in consideration of the mutual  agreements
contained  in the Credit Agreement and herein and for other  good
and  valuable consideration, the receipt and sufficiency of which
are  hereby  acknowledged  the parties  hereto  hereby  agree  as
follows:
     
      1.   Amendment  of  Section 11.1 of the  Credit  Agreement.
Section  11.1  of  the  Credit Agreement  is  hereby  amended  by
amending and restating in its entirety the table set forth at the
end of such section to read as follows:

                  Period             Amount
                                 
           Four      consecutive   $14,500,000
           fiscal       quarters 
           ending on January 31,
           1998
           
           Four      consecutive   $15,000,000
           fiscal       quarters 
           ending on each of May
           2, 1998 and August 1,
           1998
           
           Four      consecutive   $14,500,000
           fiscal       quarters 
           ending on October 31,
           1998
           
           Four      consecutive   $20,000,000
           fiscal       quarters 
           ending on January 30,
           1999 and thereafter
           

      2.   Amendment Fee.  The Borrower shall pay to  the  Agent,
for  the  account of the Banks due and payable on  the  Effective
Date, an amendment fee (the "Amendment Fee") as agreed to and set
forth  in  a  separate fee letter between the  Borrower  and  the
Agent.

      3.   Conditions  To  Effectiveness.  This  Amendment  shall
become  effective  as of the date hereof (the  "Effective  Date")
upon  satisfaction  of the following conditions:  (a)  the  Agent
receives  facsimile  copies  of  original  counterparts  (to   be
followed   promptly   by  original  counterparts)   or   original
counterparts  of this Amendment, duly executed  by  each  of  the
Borrower,  the Guarantor, the Agent, and the Majority  Banks  and
(b) the Borrower shall have paid to the Agent the Amendment Fee.

        4.     Representation   and   Warranties;   No   Default;
Authorization.   Each  of the Borrower and the  Guarantor  hereby
represents  and warrants to each of the Agent and  the  Banks  as
follows:

      (a)  Each of the representations and warranties of each  of
the Borrower and the Guarantor contained in the Credit Agreement,
the  other  Loan  Documents  or in  any  document  or  instrument
delivered pursuant to or in connection with the Credit Agreement,
the  other  Loan Documents or this Amendment was true as  of  the
date  as  of which it was made and is true as and at the date  of
this  Amendment, and no Default or Event of Default has  occurred
and is continuing as of the date of this Amendment; and

      (b)  This Amendment has been duly authorized, executed  and
delivered by each of the Borrower and the Guarantor and shall  be
in  full force and effect upon the satisfaction of the conditions
set  forth  in  3  hereof,  and the agreements  of  each  of  the
Borrower and the Guarantor party hereto contained herein, in  the
Credit  Agreement,  as  amended, and  the  other  Loan  Documents
respectively constitute the legal, valid and binding  obligations
of  each  of the Borrower and the Guarantor, enforceable  against
such  Borrower  or Guarantor in accordance with their  respective
terms,   except  as  enforceability  is  limited  by  bankruptcy,
insolvency, reorganization, moratorium or other laws relating  to
or  affecting generally the enforcement of creditors' rights  and
except  to the extent that availability of the remedy of specific
performance or injunctive relief is subject to the discretion  of
the court before which any proceeding therefor may be brought.

      4.   Entire Agreement.  This Amendment, together  with  the
Credit Agreement as amended hereby, and the other Loan Documents,
express  the entire understanding of the parties with respect  to
the transactions contemplated hereby.  Neither this Amendment nor
any  term hereof may be changed, waived, discharged or terminated
except as provided in 27 of the Credit Agreement.

      5.  Ratification, etc.  Except as expressly amended hereby,
the Credit Agreement, the other Loan Documents and all documents,
instruments  and  agreements related thereto are hereby  ratified
and  confirmed in all respects and shall continue in  full  force
and  effect.  All references in the Credit Agreement or the other
Loan  Documents or in any related agreement or instrument to  the
Credit  Agreement  or  the other Loan Documents  shall  hereafter
refer to the Credit Agreement as amended hereby, pursuant to  the
provisions of the Credit Agreement.

      6.   Implied Waiver.  Except as expressly provided  herein,
nothing contained herein shall constitute a waiver of, impair  or
otherwise  affect any Obligations, any other obligations  of  the
Borrower or the Guarantor or any right of the Agent or the  Banks
consequent thereon.

      7.  Counterparts.  This Amendment may be executed in one or
more counterparts, each of which shall be deemed an original  but
which together shall constitute one and the same instrument.

      8.   Governing Law.  THIS AMENDMENT SHALL FOR ALL  PURPOSES
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS (WITHOUT REFERENCE TO CONFLICTS  OF
LAW).


IN  WITNESS  WHEREOF, the parties hereto have  executed  this  Am
endment  as  a  document under seal as of the  date  first  above
written.
                              
                              
                              
                              FILENE'S BASEMENT, INC.
                              
                              
                              
                              By: /s/  STEVEN SIEGEL
                                 Name: Steven Siegel
                                 Title: Exec. Vice-President & Chief
                                           Financial Officer
                              
                              
                              FILENE'S BASEMENT CORP.
                              
                              
                              
                              By:  /s/ STEVEN SIEGEL
                                 Name: Steven Siegel
                                 Title: Exec. Vice-President & Chief
                                           Financial Officer 
                              
                              
                              BANKBOSTON, N.A. (f/k/a  The  First
                              National     Bank    of    Boston),
                              Individually and as Agent
                              
                              
                              
                              By:  /s/ PAUL G. FELONEY
                              _________________________________
                                 Paul G. Feloney, Director
                              
                              BANKAMERICA BUSINESS CREDIT, INC.
                              
                              
                              
                              By:
                              _________________________________
                                 Name:
                                 Title:
                              
                              
                              
                              HELLER FINANCIAL, INC.
                              
                              
                              
                              By:  /s/ THOMAS BUKOWSKI
                              _________________________________
                                 Name: Thomas Bukowski
                                 Title: Senior Vice-President
                                 
                                
                    RATIFICATION OF GUARANTY

The undersigned guarantor hereby acknowledges and consents to the
foregoing  Amendment as of October 31, 1998 and agrees  that  the
Guaranty dated as of May 23, 1996 and amended and ratified as  of
January  30, 1998, in favor of the Agent for the benefit  of  the
Agent  and  the Banks, and all other Loan Documents to which  the
Guarantor  is  a party remain in full force and effect,  and  the
Guarantor   confirms   and  ratifies  all  of   its   obligations
thereunder.


                              FILENE'S BASEMENT CORP.



By:____________________________________
                              Name:
                              Title: