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

                                  FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
    EXCHANGE ACT OF 1934

     For the quarterly period ended July 31, 1999

                                     OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
    EXCHANGE ACT OF 1934

     For the transition period from             to

                     Commission file number     0-19149


                               FILENE'S BASEMENT CORP.
            (Exact name of registrant as specified in its charter)

     Massachusetts                                      04-3016733
(State or other jurisdiction of                     (I.R.S. Employer
incorporation or organization)                      Identification No.)

                     40 Walnut Street, Wellesley, MA 02481
                   (Address of principal executive offices)
                                  (Zip Code)

                                (617) 348-7000
             (Registrant's telephone number, including area code)



Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.

                              Yes  X    No_____

Indicate by check mark whether the registrant has filed all documents and
reports required  to be filed by Section 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a
plan confirmed by a court.
Yes____   No____  Not yet applicable__X_

(The Company and its subsidiary filed voluntary petitions pursuant to
provisions of Chapter 11 of the United States Bankruptcy Code on August 23,
1999.  No plan has been confirmed by a court.)

The number of shares of common stock outstanding as of August 31, 1999 was
21,000,256 shares.
<PAGE>
                         FILENE'S BASEMENT CORP.
                            TABLE OF CONTENTS





PART I - FINANCIAL INFORMATION                              Page No.

  Item 1 - Financial Statements

     Consolidated Balance Sheets as of                         3
     July 31, 1999, January 30, 1999
     and August 1, 1998


     Consolidated Statements of Operations                     4
     for the thirteen weeks ended
     July 31, 1999 and August 1, 1998


     Consolidated Statements of Operations                     5
     for the twenty-six weeks ended
     July 31, 1999 and August 1, 1998


     Consolidated Statements of Cash Flows                     6
     for the twenty-six weeks ended
     July 31, 1999 and August 1, 1998


     Notes to Consolidated Financial Statements                7



  Item 2 - Management's Discussion and Analysis of            10
     Financial Condition and Results of Operations




PART II - OTHER INFORMATION


  Item 1 - Legal Proceedings                                  16

  Item 4 - Submission of Matters to a Vote of                 16
     Security Holders

  Item 5 - Other Information                                  16

  Item 6 - Exhibits and Reports on Form 8-K                   17




                                      2
<PAGE>
                           FILENE'S BASEMENT CORP.
                         CONSOLIDATED BALANCE SHEETS
                           (dollars in thousands)


                                         July 31,     January 30,   August 1,
                                           1999          1999         1998
                                        ----------    ----------   ----------
  ASSETS                                 (unaudited)               (unaudited)
Current assets:
  Cash and cash equivalents              $    871     $    830     $    740
  Inventories                              95,593      105,773      117,318
  Other current assets                     13,756       11,529       12,827
                                          -------      -------      -------
    Total current assets                  110,220      118,132      130,885

Property, plant and equipment, net         64,160       61,279       51,938
Beneficial operating lease rights, net     11,526       12,183       12,840
Intangible assets, net and other           14,279       11,107        9,717
                                          -------      -------      -------
                                         $200,185     $202,701     $205,380
                                          =======      =======      =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable                       $ 46,381     $ 56,090     $ 49,293
  Accrued expenses                         28,379       27,539       27,267
  Short-term debt                          66,282       38,561       25,800
  Current portion of long-term debt           -           -           2,000
  Obligations under capital leases            587          553          434
                                          -------      -------      -------
    Total current liabilities             141,629      122,743      104,794

Reserve for store closings                  2,733        2,857        2,933
Deferred revenue                            2,048        1,665        1,748
Long-term debt                                -           -          10,500
Obligations under capital leases            2,374        2,648        2,554

Stockholders' equity:
  Common stock, $.01 par value,
    70,000,000 shares authorized,
    21,075,256, 21,047,244 and
    21,011,880 shares issued                  211          211          210
  Additional paid-in capital               87,147       87,141       87,063
  Accumulated deficit                     (35,552)     (14,159)      (4,406)
  Accumulated other comprehensive income     (389)        (389)         -
  Treasury stock, 75,000 shares               (16)         (16)         (16)
                                          -------      -------      -------
    Total stockholders' equity             51,401       72,788       82,851
                                          -------      -------      -------
                                         $200,185     $202,701     $205,380
                                          =======      =======      =======


See Notes to Consolidated Financial Statements.

                                      3
<PAGE>
                           FILENE'S BASEMENT CORP.
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                            Thirteen Weeks Ended
                                 (Unaudited)
                  (in thousands, except per share amounts)




                                           July 31,           August 1,
                                            1999                1998
                                         ----------         ----------
Net sales                                 $143,977           $131,396
Cost of sales, including buying,
  receiving and occupancy costs            115,429             99,204
                                           -------            -------
    Gross profit                            28,548             32,192

Selling, general and administrative
  expenses                                  40,117             29,683

Amortization of intangible assets and
  beneficial operating lease rights            366                366
                                           -------            -------
    Operating income (loss)                (11,935)             2,143

Interest expense, net                        3,015                869
                                           -------            -------
Income (loss) before income taxes          (14,950)             1,274

Income tax provision (Note 2)                  -                  278
                                           -------            -------
Net income (loss)                         $(14,950)           $   996
                                           =======            =======




Basic and diluted earnings (loss)         $  (0.71)          $   0.05
  per share (Note 3)                       =======            =======






See Notes to Consolidated Financial Statements.





                                      4
<PAGE>
                           FILENE'S BASEMENT CORP.
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                           Twenty-Six Weeks Ended
                                 (Unaudited)
                  (in thousands, except per share amounts)




                                           July 31,           August 1,
                                            1999                1998
                                         ----------         ----------
Net sales                                 $280,800           $259,043
Cost of sales, including buying,
  receiving and occupancy costs            221,317            196,376
                                           -------            -------
  Gross profit                              59,483             62,667

Selling, general and administrative
  expenses                                  75,903             60,097

Amortization of intangible assets and
  beneficial operating lease rights            733                733
                                           -------            -------
    Operating income (loss)                (17,153)             1,837

Interest expense, net                        4,240              1,513
                                           -------            -------
Income (loss) before income taxes          (21,393)               324

Income tax provision (Note 2)                  -                   69
                                           -------            -------
Net income (loss)                         $(21,393)          $    255
                                           =======            =======




Basic and diluted earnings (loss)         $  (1.02)          $   0.01
  per share (Note 3)                       =======            =======





See Notes to Consolidated Financial Statements.




                                      5
<PAGE>
                           FILENE'S BASEMENT CORP.
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                           Twenty-Six Weeks Ended
                                 (Unaudited)
                               (in thousands)

                                               July 31,          August 1,
                                                1999               1998
                                             ----------         ----------
CASH FLOW FROM OPERATING ACTIVITIES:
  Net income (loss)                            $(21,393)         $     255
  Adjustments to reconcile net income (loss)
    to net cash used in operations:
      Depreciation and amortization               7,134              6,716
      Decrease (increase) in inventories         10,180            (24,297)
      Increase in other current assets           (2,227)            (1,665)
      (Decrease) increase in accounts payable    (9,709)             6,595
      Increase in accrued expenses
        and other liabilities                       716                649
      Other                                         383                (84)
                                                --------           --------
    Net cash used in operating activities       (14,916)           (11,831)

CASH FLOWS FROM INVESTING ACTIVITIES:
  Capital expenditures                           (9,281)            (9,579)
  Other                                          (3,249)              (952)
                                                -------            -------
    Net cash used in investing activities       (12,530)           (10,531)

CASH FLOWS FROM FINANCING ACTIVITIES:
  Short-term borrowings, net                     27,721             22,700
  Payments of capital lease obligation             (240)              (203)
  Proceeds from common stock issuance                 6                130
                                                -------            -------
Net cash provided by
      financing activities                       27,487             22,627
                                                -------            -------
Net increase in cash
  and cash equivalents                               41                265

Cash and cash equivalents:
  Beginning of period                               830                475
                                                -------            -------
  End of period                                $    871           $    740
                                                =======            =======


See Notes to Consolidated Financial Statements.


                                      6
<PAGE>
                           FILENE'S BASEMENT CORP.
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.   BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements are presented in
accordance with the requirements of Form 10-Q and consequently do not include
all the disclosures normally required by generally accepted accounting
principles or those normally made in the Company's Form 10-K filing.
Reference should be made to the Company's Annual Report on Form 10-K for
additional disclosures, including a summary of the Company's accounting
policies.  The results of the periods ended July 31, 1999 and August 1, 1998
are not necessarily indicative of the results for a full fiscal year because
the Company's business, in common with the businesses of retailers generally,
is subject to seasonal influences, with higher levels of sales and income
generally realized in the fall season.  The information furnished, in the
opinion of management, includes all normal recurring adjustments necessary
for a fair presentation of the results of operations for the periods
reported.

On August 23, 1999, the Company and its subsidiary filed voluntary petitions
seeking relief under Chapter 11 of the federal bankruptcy laws in the United
States Bankruptcy Court for the District of Massachusetts (the "Bankruptcy
Court").  Under Chapter 11, certain claims against the debtor in existence
prior to the filing of the petition for relief under the federal bankruptcy
laws are stayed while the debtor continues business operations as a debtor in
possession.  In addition, under the federal bankruptcy code, the Company may
reject leases and executory contracts.  Claims (liabilities subject to
compromise) may arise subsequent to the filing date resulting from the
rejection of executory contracts, including leases, and from the
determination of the court (or agreed to by parties in interest) of allowed
claims for contingencies and other disputed amounts.

The Company intends to operate its business during the reorganization process
and entered into a $135 million debtor in possession financing facility on
August 23, 1999.  The Bankruptcy Court has approved the financing facility on
an interim basis and has scheduled a final hearing on September 15, 1999. The
Company believes this new facility will allow it to meet its merchandise
inventory and normal operating expense needs, as well as presently anticipated
capital expenditure requirements, for the remainder of the fiscal year.
Accordingly, the accompanying consolidated financial statements have been
prepared assuming that the Company will continue as a going concern.  However,
the Company's operating results and adequacy of its working capital could be
adversely affected if, for any reason, the Company's borrowing base was to
become impaired, or portions thereof were otherwise deemed ineligible, thereby
diminishing the level of available funds.  The Company is subject to various
covenants under the new financing facility including minimum eligible
inventory levels and maximum loans outstanding to eligible inventory ratios.

                                      7
<PAGE>
                           FILENE'S BASEMENT CORP.
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.   BASIS OF PRESENTATION (Continued)

In response to the Company's press release regarding its filing for
protection under Chapter 11, NASDAQ halted trading of its common stock on
August 23, 1999.  Trading will remain halted pending receipt and review of
additional information by NASDAQ as set forth in its letter to the Company
dated August 23, 1999.  The Company will cooperate in providing the requested
information to NASDAQ.

2.   RESTRUCTURING CHARGES

Included in accrued expenses at July 31, 1999 are restructuring costs
incurred related to the closing of three stores that will be completed in the
third and fourth quarters of this year.  These costs consisted of the
following:

Markdown reserve                                  $1,138
Write-off of leasehold improvements
  and fixtures                                       861
Severance and other closing expenses                 604
                                                   -----
                                                  $2,603
                                                   =====

As of July 31, 1999, no amounts had been expended relating to the above
charges.

3.   INCOME TAXES

The Fiscal 1999 income tax benefit was reduced to zero by an increase in the
income tax valuation allowance necessary to bring the deferred tax asset to a
level, that would more likely than not, be realized.

4.   EARNINGS PER SHARE

In accordance with Statement of Financial Accounting Standards (SFAS) No.
128, "Earnings per Share", basic earnings per share is computed using the
weighted average number of shares outstanding during each period.

Diluted earnings per share is computed using the weighted number of
outstanding shares plus the weighted average number of dilutive common
equivalent shares outstanding during each period.

The following is a reconciliation of the outstanding shares used in
calculating earnings per share for the thirteen week and twenty-six week
periods ended July 31, 1999 and August 1, 1998 (in thousands):





                                      8
<PAGE>
                           FILENE'S BASEMENT CORP.
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


4.   EARNINGS PER SHARE (Continued)

                                                Thirteen Weeks Ended
                                              July 31,           August 1,
                                                1999               1998
                                             ---------           --------

Basic shares outstanding                       20,999             20,917

Options                                           -                  658
                                              -------            -------
Dilutive shares outstanding                    20,999             21,575
                                              =======            =======

                                               Twenty-Six Weeks Ended
                                             July 31,           August 1,
                                               1999               1998
                                            ---------           --------

Basic shares outstanding                       20,989             20,906

Options                                           -                  669
                                              -------            -------
Dilutive shares outstanding                    20,989             21,575
                                              =======            =======

Options for the thirteen and twenty-six weeks ended July 31, 1999 to purchase
shares of 3,084,872 and 3,027,453, respectively, and options for the thirteen
and twenty-six weeks ended August 1, 1998 to purchase shares of 828,220 and
814,564, respectively, are not included in the computation of diluted
earnings per share because to do so would have been antidilutive for those
periods.

5.   SEGMENT INFORMATION

In Fiscal 1998, the Company adopted SFAS No. 131, "Disclosures about Segments
of an Enterprise and Related Information", which establishes standards for
reporting information about operating segments in annual financial statements
and requires selected information about segments in interim financial reports
issued to stockholders.  It also establishes standards for related
disclosures about products and services, and geographic areas.  Operating
segments are defined as components of an enterprise about which separate
financial information is available that is evaluated regularly by the chief
operating decision-maker or decision making group, in deciding how to
allocate its resources and in assessing performance.  Based on the standards
applied in SFAS No. 131, the Company has only one reportable segment.



                                      9
<PAGE>
                           FILENE'S BASEMENT CORP.
              MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                     CONDITION AND RESULTS OF OPERATIONS


RESULTS OF OPERATIONS

For the quarter ended July 31, 1999 net sales were $144.0 million, up 9.6%
from last year's second quarter sales of $131.4 million. Comparable store
sales for the second quarter were down 3.4% versus last year.  Net sales for
the twenty-six week period ended July 31, 1999 were up 8.4% versus last year
while comparable store sales were down 3.7%.  The comparable store decreases
were primarily attributable to disappointing sales, which were in part due to
insufficient quantities of inventory due to vendor concerns regarding the
financial position of the Company.  The increase in net sales for the
thirteen and twenty-six week periods ended July 31, 1999 was due to the
opening of four new "Aisle 3" stores in the first quarter of fiscal 1999 and
four new Basement stores in the last half of 1998.  At the end of fiscal
July, the Company operated 51 traditional Filene's Basement stores and four
Aisle 3 weekend warehouse stores, primarily in the Northeast and Midwest,
versus 47 traditional Filene's Basement stores last year.

Cost of sales as a percentage of sales was 80.2% and 78.8% for the thirteen
and twenty-six week periods ended July 31, 1999 compared to 75.5% and 75.8%
for the corresponding periods in the prior year. These increases were
primarily attributable to an increase in markdowns combined with an increase
in buying, selling and occupancy costs, as a percentage of sales, due to the
decline in same store sales.  In addition, a $1.9 million markdown reserve
was established in the second quarter for the closing of three traditional
Filene's Basement stores and to clear out additional inventory. (See Outlook)

Selling, general and administrative expenses for the second quarter of 1999
were $40.1 million, or 27.9% of sales, compared to $29.7 million, or 22.6% of
sales, for the same period last year.  The increase in selling, general and
administrative expenses, in absolute terms, was primarily the result of
opening six new Basement stores in 1998 and the opening of four new "Aisle 3"
stores in the first quarter of 1999.  As a percentage of sales, expenses
increased primarily due to a $1.4 million charge for costs relating to the
closing of certain stores that will be completed in the third quarter of 1999
(See Outlook), as well as the decrease in comparable sales noted above.
Selling, general and administrative expenses for the twenty-six weeks ended
July 31, 1999 were $75.9 million, or 27.0% of sales, compared to $60.1
million or 23.2% of sales in the prior year period.  In addition to the
reasons stated above, the increase in expenses was attributable to an
increase of approximately $1.4 million in pre-opening costs relating to the
new "Aisle 3" stores in the first quarter of 1999. The Company adopted
Statement of Position 98-5, "Accounting for Start-Up Activities", in fiscal
1998 which requires the Company to expense the costs of all start-up
activities as incurred.  The Company had historically amortized these costs
over the remainder of the fiscal year.
                                     10
<PAGE>
                           FILENE'S BASEMENT CORP.
              MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                     CONDITION AND RESULTS OF OPERATIONS


RESULTS OF OPERATIONS (CONTINUED)

Net interest expense for the quarter ended July 31, 1999 was $3.0 million
compared to $0.9 million last year.  Net interest expense for the twenty-six
weeks ended July 31, 1999 was $4.2 million, compared to $1.5 million last
year.  The increase in net interest expense was primarily due to a $1.7
million write-off of deferred financing costs relating to the Company's old
financing agreement. The remaining increase was due to both higher average
outstanding borrowings and higher interest rates in the second quarter of
1999. (See Financial Condition, Liquidity and Capital Resources.)  These
increases were partially offset by discounts of approximately $0.3 million on
advance payments to vendors in the second quarter of 1999.

Net loss for the quarter ended July 31, 1999 was $15.0 million, or $0.71 per
share, on 21.0 million weighted average shares outstanding, compared to net
income of $1.0 million, or $0.05 per share, on 21.6 million weighted average
shares outstanding for the quarter ended August 1, 1998.  Net loss for the
twenty-six weeks ended July 31, 1999 was $21.4 million, or $1.02 per share,
on 21.0 million weighted average shares outstanding, compared to net income
of $0.3 million, or $0.01 per share, on 21.6 million weighted average shares
outstanding for the twenty-six weeks ended August 1, 1998.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

On July 27, 1999, the Company entered into a $125 million revolving credit
facility (the "Agreement"), which replaced the Company's Second Amended and
Restated Revolving Credit Agreement dated January 22, 1999, as amended June
15, 1999 (the "Old Agreement"). The Agreement consisted of two Tranches,
Tranche A of $85 million and Tranche B of $40 million.  The interest rates on
the Agreement for Tranche A borrowings was based, at the Company's option, on
prime rate plus 0.75% or LIBOR plus 2.25%, while Tranche B borrowings were
based on prime rate plus 4.25%.  These rates were to be adjusted up or down
quarterly as determined by the Company's financial performance during the
four preceding quarters.

During the six months ended July 31, 1999, average borrowings under the
Agreement and the Old Agreement were approximately $58.4 million at an
average interest rate of 7.99%.  During the same period last year, average
borrowings were $27.5 million at an average interest rate of 7.94%. Excess
credit availability at July 31, 1999 was approximately $10.9 million compared
to approximately $25.5 million at August 1, 1998.


                                     11
<PAGE>
                           FILENE'S BASEMENT CORP.
              MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                     CONDITION AND RESULTS OF OPERATIONS


FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES(CONTINUED)

The Agreement contained financial covenants, which required cumulative
minimum earnings before interest, taxes, depreciation and amortization
(EBITDA) and a minimum ratio of eligible inventory to accounts payable, as
well as a limit on capital expenditures for specified periods during the term
of the Agreement.

Net cash used in operating activities was $14.9 million for the twenty-six
weeks ended July 31, 1999 versus cash used of $11.8 million during the same
period last year.  The $3.1 million increase in cash used by operations was
primarily due to a decrease in EBITDA from income of $8.6 million in 1998 to
a loss of $(10.0) million in 1999.  This decrease was offset by reduced
purchases of inventory as the result of vendor concerns regarding the
Company.

Net cash used in investing activities during 1999 increased $2.0 million over
the comparable period in 1998 primarily as a result of the deferred financing
costs incurred in connection with the Agreement entered into in July 1999.
During fiscal 1999, capital expenditures are expected to approximate $20
million.

Net cash provided by financing activities during the six months ended July
31, 1999 was $27.5 million as compared to $22.6 million in the same period of
the prior year.  The $4.9 million increase was primarily due to increased
short-term borrowings in 1999 as the result of the opening of the four "Aisle
3" stores and the decrease in EBITDA.

On August 23, 1999, the Company filed a voluntary petition seeking relief
under Chapter 11 of the United States bankruptcy code as the result of
reduced trade support and interruption in inventory deliveries.  On August
23, 1999, the Company also entered into the Debtor In Possession Credit
Agreement (the "New Agreement") with GE Capital as agent and Paragon Capital
LLC as oversight agent. The New Agreement replaces the Agreement.  As the case
with the Agreement, the New Agreement consists of two Tranches, Tranche A of
$85 million which bears interest at a rate, at the Company's option, of prime
plus 1.25% or LIBOR plus 2.75%, and Tranche B of $50 million, which bears
interest at a rate of 14.25%, and to the extent advances are made against
real estate collateral, 18%.  The New Agreement expires on the earlier of
February 23, 2001 or the first effective date of any plan of reorganization.
In addition to the covenants contained in the Agreement, the New Agreement
also contains covenants which require minimum eligible inventory levels and
maximum loans outstanding to eligible inventory ratios.





                                     12
<PAGE>
                           FILENE'S BASEMENT CORP.
              MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                     CONDITION AND RESULTS OF OPERATIONS



FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES(CONTINUED)

The Company believes the New Agreement will allow the Company
to meet its merchandise inventory and normal operating expense needs, as well
as presently anticipated capital expenditure requirements, for the remainder
of the fiscal year. However, the Company's operating results and the adequacy
of its working capital could be adversely affected if, for any reason, the
Company's borrowing base was to become impaired, or otherwise be deemed
ineligible, thereby diminishing the level of available funds.   In addition,
because of uncertainty regarding the outcome of the bankruptcy case and the
effect of any bankruptcy reorganization plan on the interest of the Company's
creditors and stockholders, the ultimate impact on the Company's results of
operations and financial position cannot be determined.

The Company's business is seasonal, reflecting increased consumer demand in
the fall season.  The second half of each fiscal year provides a greater
portion of the Company's annual sales and operating profit.

YEAR 2000

The Company utilizes software and related technologies throughout its
business that will be affected by the "Year 2000" problem, which is common to
most corporations, and concerns the inability of information systems,
primarily computer software programs, to properly recognize and process date
sensitive information as the year 2000 approaches.

While it is not possible at this time to predict the total cost of this
effort, the investment, whether leased, purchased or expensed, in new
software and equipment needed to achieve "Year 2000" compliance and enhance
existing systems, is currently estimated at approximately $31.0 million, of
which $19.9 million had been incurred through July 31, 1999. The expense
portion of the total project is estimated at $11.9 million of which $2.2
million and $3.0 million is expected to be incurred in fiscal 1998 and fiscal
1999, respectively. Through July 31, 1999, $3.8 million has been expensed.
Funding requirements have been incorporated into the Company's capital and
operating plans and are not expected to have a material adverse impact on the
Company's financial condition or liquidity.

The Company believes its Year 2000 program will be completed on a timely
basis and should effectively minimize disruption to the Company's operations,
however, there can be no assurance that the Company will be successful in
this respect.


                                     13
<PAGE>
                           FILENE'S BASEMENT CORP.
              MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                     CONDITION AND RESULTS OF OPERATIONS


FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES(CONTINUED)

OUTLOOK

As noted above, on August 23, 1999, the Company filed a voluntary petition
with the United States Bankruptcy Court for the District of Massachusetts in
Boston, MA seeking relief under Chapter 11 of the United States Bankruptcy
Code.  The filing was principally the result of a lack of trade support and
interruption in inventories.  The Company intends to operate its business
during the reorganization process and has entered into a $135 million debtor
in possession financing facility, which has been approved on an interim basis
pending a final hearing. The Company believes this facility will provide
sufficient funding for a timely flow of merchandise during the reorganization
process.

Prior to the filing, the Company began implementing strategies to improve
merchandising, operations and enhance financial performance, including a
reduction of headquarters staff by 15%. As part of this strategy, the Company
will close three of its traditional stores. The Franklin Mills, PA and
Sunrise, FL locations will close in the third quarter of 1999 and the
Plymouth, MA location will close in the fourth quarter of 1999.

The Company plans to open four new Aisle 3 stores in the third quarter of
1999.  The new format leverages the current Filene's Basement infrastructure
and vendor relationships.  The capital required to open an "Aisle 3" store is
significantly less than that required to open a traditional Filene's Basement
specialty store.

This Quarterly Report on Form 10-Q contains forward-looking statements.  For
this purpose, any statements contained herein that are not statements of
historical fact may be deemed to be forward-looking statements.  Without
limiting the foregoing, the words "believes", "anticipates", "plans",
"expects" and similar expressions are intended to identify forward-looking
statements. Factors which may cause actual results to differ materially from
those indicated by such forward-looking statements include, among others: (i)
Bankruptcy Court actions or proceedings related to the bankruptcy, (ii)
economic and weather conditions which affect the buying patterns of the
Company's customers, (iii) actions of the Company's competitors and the
Company's ability to respond to such actions, (iv) the continued support of
the Company's numerous vendors and third party factors in the form of short-
term trade credit through extended payment terms and letters of credit, (v) a
decrease in the Company's available funds due to the impairment or
ineligibility of a significant portion of its borrowing base,



                                     14
<PAGE>
                           FILENE'S BASEMENT CORP.
              MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                     CONDITION AND RESULTS OF OPERATIONS


FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES(CONTINUED)


(vi) the continued success of the Company's efforts to implement planned
strategic initiatives, (vii) unexpected store closings and the related higher
markdowns associated with inventory liquidations, (viii) any unanticipated
impact of the "Year 2000" problem and (ix) the extent to which the Aisle 3
concept is successful.










































                                     15
<PAGE>
                         PART II - OTHER INFORMATION


ITEM 1    LEGAL PROCEEDINGS

As reported in its report on Form 8-K dated August 26, 1999, Filene's
Basement Corp. and its subsidiary filed voluntary petitions for relief under
Chapter 11 of the United States Bankruptcy Code on August 23, 1999.

ITEM 4    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

The Annual Meeting of Stockholders of Filene's Basement Corp. was held on
June 22, 1999, for the purpose of electing a Class II Director of the Company
to serve until the year 2002 Annual Meeting of Stockholders or until their
successors are duly elected and qualified.  The following sets forth the
results of shareholder voting:

Election of Class II Director:
                                         Votes in             Votes
                                          Favor              Withheld
                                         --------            --------
Election of Harold Leppo
  as Class II Director                  14,358,478          4,199,821







ITEM 5    OTHER INFORMATION

Stockholder Proposals for 2000 Annual Meeting

Stockholder proposals submitted pursuant to Rule 14a-8 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and intended to be
presented at the Company's 2000 Annual Meeting of Stockholders must be
received by the Company not later than January 18, 2000 in order to be
considered for inclusion in the Company's proxy materials for that meeting.

In addition, in accordance with recent amendments to Rules 14a-4, 14a-5 and
14a-8 under the Exchange Act, written notice of stockholder proposals
submitted outside the processes of Rule 14a-8 for consideration at the 2000
Annual Meeting of Stockholders must be received by the Company on or before
March 29, 2000 in order to be considered timely for purposes of Rule 14a-4.








                                     16
<PAGE>
                         PART II - OTHER INFORMATION


ITEM 5    OTHER INFORMATION (CONTINUED)

In addition, the Company's Restated By-Laws also establish an advance notice
procedure with respect to stockholder nomination of candidates for election
as directors.  A notice regarding stockholder nominations for director must
be accompanied by a petition signed by at least 100 record holders
representing in the aggregate at least 1% of the outstanding shares entitled
to vote for directors.  Such notice must be received by the clerk of the
Company not less than 60 days or more than 90 days prior to the applicable
stockholder meeting, provided, however, that, in the event the date of the
meeting is not publicly announced by the Company more than 70 days prior to
the meeting, the notice must be received by the Company not later than the
close of business on the tenth day following the day on which such
announcement of the date of the meeting is made.  Any such notice must be
written and contain certain specified information concerning the persons to
be nominated and the stockholder submitting the nomination, all as set forth
in the Company's Restated By-Laws.  The presiding officer of the meeting may
refuse to acknowledge any director nomination not made in compliance with
such advance notice requirements.  The Company has not yet publicly announced
the date of the 2000 Annual Meeting.  The advance notice provisions of the
Company's Restated By-Laws supersede the notice requirements contained in
recent amendments to Rule 14a-14 under the Exchange Act.


ITEM 6    EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits

    4.1  Debtor in Possession Credit Agreement, dated as of August 23, 1999
         among Filene's Basement Inc., debtor and debtor in possession, as
         borrower, the other parties signatory hereto, as credit parties, the
         lenders signatory  hereto from time to time, as lenders, Paragon
         Capital LLC, as oversight agent, and General Electric Capital
         Corporation, as agent.

    27   Financial Data Schedule


(b) Reports on Form 8-K

    On August 10, 1999, the Company filed an 8-K announcing the closing of a
$125 million credit facility.

    On August 26, 1999, the Company filed an 8-K announcing the voluntary
filing of a petition for reorganization under Chapter 11 of the United States
Bankruptcy Code.



                                     17
<PAGE>
                                 SIGNATURES





Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, being also its principal financial
officer.




                                                 FILENE'S BASEMENT CORP.

                                                 /s/ Steven Siegel
                                                 ---------------------
                                                 Steven Siegel
                                                 Executive Vice President
                                                 & Chief Financial Officer



DATE:  September 14, 1999





























                                     18
<PAGE>
                                EXHIBIT INDEX

                   Pursuant to Item 601 of Regulation S-K





Exhibit                   Title



4.1  Debtor in Possession Credit Agreement, dated as of August 23, 1999 among
       Filene's Basement Inc., debtor and debtor in possession, as borrower,
       the other parties signatory hereto, as credit parties, the lenders
       signator hereto from time to time, as lenders, Paragon Capital LLC, as
       oversight agent, and General Electric Capital Corporation, as agent.

27   Financial Data Schedule