Page 1 of 41
                                          Index to Exhibits - Pages 22-33

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

                          FORM 10-Q

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

For the quarterly period ended October 1, 2000

                        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    1-3634

                       CONE MILLS CORPORATION
      (Exact name of registrant as specified in its charter)

         North Carolina                               56-0367025
(State or other jurisdiction of                       (I.R.S. Employer
 incorporation or organization)                       Identification No.)

3101 North Elm Street, Greensboro, North Carolina     27408
(Address of principal executive offices)              (Zip Code)

                           336.379.6220
      (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

Number of shares of common stock outstanding as of October 27, 2000:
25,506,569 shares.
                                      1
<PAGE>

                   CONE MILLS CORPORATION

                            INDEX

PART I.  FINANCIAL INFORMATION
                                                                 Page
                                                                Number
Item 1.  Financial Statements

         Consolidated Condensed Statements of Operations
         Thirteen and thirty-nine weeks ended October 1,
         2000 and October 3, 1999 (Unaudited) .......................3

         Consolidated Condensed Balance Sheets
         October 1, 2000 and October 3, 1999 (Unaudited)
         and January 2, 2000.........................................4

         Consolidated Condensed Statements of Cash Flows
         Thirty-nine weeks ended October 1, 2000 and
         October 3, 1999 (Unaudited) ................................5

         Notes to Consolidated Condensed Financial Statements
         (Unaudited).................................................6

Item 2.  Management's Discussion and Analysis of
         Financial Condition and Results of Operations..............13

Item 3.  Quantitative and Qualitative Disclosures about Market
         Risk ......................................................20


PART II. OTHER INFORMATION

Item 1.  Legal Proceedings..........................................21
Item 6.  Exhibits and Reports on Form 8-K...........................21
                                    2
<PAGE>
                                 CONE MILLS CORPORATION AND SUBSIDIARIES
                             CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
                                  (in thousands, except per share data)
<TABLE>
<S>                                                  <C>                <C>               <C>               <C>
                                                         Thirteen            Thirteen        Thirty-Nine       Thirty-Nine
                                                        Weeks Ended        Weeks Ended       Weeks Ended       Weeks Ended
                                                      October 1, 2000    October 3, 1999   October 1, 2000   October 3, 1999
                                                      ----------------------------------------------------------------------
                                                        (Unaudited)        (Unaudited)       (Unaudited)       (Unaudited)

Net Sales                                               $ 165,273          $ 147,197         $ 468,499          $ 478,946
Cost of Goods Sold                                        147,726            136,521           414,259            438,684
                                                       ---------------------------------------------------------------------
Gross Profit                                               17,547             10,676            54,240             40,262

Selling and Administrative                                 11,057             11,992            37,236             37,022
Restructuring and Impairment of Assets                          -              3,100              (332)            16,017
                                                       ---------------------------------------------------------------------
Income (Loss) from Operations                               6,490             (4,416)           17,336            (12,777)
                                                       ---------------------------------------------------------------------
Other Income (Expense)
   Interest income                                            250                400               892              1,276
   Interest expense                                        (4,701)            (3,521)          (14,198)           (10,678)
   Other expense                                           (1,275)              (264)           (3,230)              (264)
                                                       ---------------------------------------------------------------------
                                                           (5,726)            (3,385)          (16,536)            (9,666)
                                                       ---------------------------------------------------------------------
Income (Loss) before Income Taxes (Benefit), Equity
   in Earnings (Losses) of Unconsolidated Affiliate
   and Cumulative Effect of Accounting Change                 764             (7,801)              800            (22,443)
Income Taxes (Benefit)                                        260             (2,808)              272             (7,775)
                                                       ---------------------------------------------------------------------
Income (Loss) before Equity in Earnings (Losses) of
   Unconsolidated Affiliate and Cumulative Effect
   of Accounting Change                                       504             (4,993)              528            (14,668)
Equity in Earnings (Losses) of Unconsolidated
   Affiliate                                                  932               (405)            2,157              1,552
                                                       ---------------------------------------------------------------------
Income (Loss) before Cumulative Effect of Accounting
   Change                                                   1,436             (5,398)            2,685            (13,116)
Cumulative Effect of Accounting Change                          -                  -                 -             (1,038)
                                                       ---------------------------------------------------------------------
Net Income (Loss)                                      $    1,436           $ (5,398)        $   2,685          $ (14,154)
                                                       ---------------------------------------------------------------------
Income (Loss) Available to Common Shareholders
   Income (Loss) before Cumulative Effect of
     Accounting Change                                 $      389           $ (6,188)        $    (164)         $ (15,416)
   Cumulative Effect of Accounting Change                       -                  -                 -             (1,038)
                                                       ---------------------------------------------------------------------
   Net Income (Loss)                                   $      389           $ (6,188)        $    (164)         $ (16,454)
                                                       ---------------------------------------------------------------------
Earnings (Loss) Per Share - Basic and Diluted
   Income (Loss) before Cumulative Effect of
     Accounting Change                                 $     0.02           $  (0.24)        $   (0.01)         $   (0.61)
   Cumulative Effect of Accounting Change                       -                  -                 -              (0.04)
                                                       ---------------------------------------------------------------------
   Net Income (Loss)                                   $     0.02           $  (0.24)        $   (0.01)         $   (0.65)
                                                       ---------------------------------------------------------------------
Weighted-Average Common Shares Outstanding
   Basic                                                   25,496             25,486            25,487             25,453
                                                       ---------------------------------------------------------------------
   Diluted                                                 25,649             25,486            25,487             25,453
                                                       ---------------------------------------------------------------------
</TABLE>
See Notes to Consolidated Condensed Financial Statements.
                                                               3
<PAGE>
                                     CONE MILLS CORPORATION AND SUBSIDIARIES
                                      CONSOLIDATED CONDENSED BALANCE SHEETS
                                 (in thousands, except share and par value data)
<TABLE>
<S>                                                            <C>         <C>         <C>
                                                                October 1,  October 3,  January 2,
                                                                  2000        1999         2000
                                                                -----------------------------------
                                                               (Unaudited)  (Unaudited)    (Note)
ASSETS
   Current Assets
    Cash                                                        $   1,707   $   3,925   $   1,267
    Accounts receivable, less allowance of $5,050                  48,089      48,798      47,531
    Inventories                                                   109,849     118,393     110,613
    Other current assets                                            9,925      10,504       6,149
                                                                  ---------------------------------
     Total Current Assets                                         169,570     181,620     165,560

   Investments in Unconsolidated Affiliates                        54,203      46,003      46,815
   Other Assets                                                    37,393      36,158      38,964
   Property, Plant and Equipment                                  206,703     222,543     221,458
                                                                  ---------------------------------
                                                                $ 467,869   $ 486,324   $ 472,797
                                                                  ---------------------------------
LIABILITIES AND STOCKHOLDERS' EQUITY
   Current Liabilities
    Current maturities of long-term debt                        $  72,495   $  67,714   $  79,714
    Accounts payable                                               45,924      41,280      26,849
    Sundry accounts payable and accrued liabilities                26,691      34,688      33,866
    Deferred income taxes                                          15,112      15,158       9,894
                                                                  ---------------------------------
     Total Current Liabilities                                    160,222     158,840     150,323

   Long-Term Debt                                                 108,734     119,004     119,115
   Deferred Income Taxes                                           30,780      32,588      33,916
   Other Liabilities                                               11,876      11,702      11,958

   Stockholders' Equity
    Class A preferred stock - $100 par value; authorized
     1,500,000 shares; issued and outstanding 343,546 shares;
     1999, 372,638 shares and 355,635 shares                       34,355      37,264      35,564
    Class B preferred stock - no par value; authorized
     5,000,000 shares                                                   -           -           -
    Common stock - $.10 par value; authorized 42,700,000
     shares; issued and outstanding 25,497,459 shares;
     1999, 25,485,717 shares and 25,479,717 shares                  2,550       2,549       2,548
    Capital in excess of par                                       57,514      57,522      57,435
    Retained earnings                                              70,513      75,761      70,776
    Deferred compensation - restricted stock                         (158)       (448)       (321)
    Accumulated other comprehensive loss, currency
      translation adjustment                                       (8,517)     (8,458)     (8,517)
                                                                  ---------------------------------
     Total Stockholders' Equity                                   156,257     164,190     157,485
                                                                  ---------------------------------
                                                                $ 467,869   $ 486,324   $ 472,797
                                                                  ---------------------------------
</TABLE>
Note:  The balance sheet at January 2, 2000, has been
       derived from the financial statements at that date.

See Notes to Consolidated Condensed Financial Statements.
                                                         4
<PAGE>
                   CONE MILLS CORPORATION AND SUBSIDIARIES
               CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                (in thousands)
<TABLE>
<S>                                                                  <C>             <C>
                                                                      Thirty-Nine       Thirty-Nine
                                                                      Weeks Ended       Weeks Ended
                                                                    October 1, 2000   October 3, 1999
                                                                    ---------------------------------
                                                                      (Unaudited)       (Unaudited)

CASH PROVIDED BY OPERATIONS                                            $ 32,033          $  1,327
                                                                       ------------------------------
INVESTING
   Investments in unconsolidated affiliates                              (5,231)                -
   Proceeds from sale of property, plant and equipment                    2,715             2,824
   Capital expenditures                                                  (4,196)           (8,040)
                                                                       ------------------------------
    Cash used in investing                                               (6,712)           (5,216)
                                                                       ------------------------------
FINANCING
   Net payments under line of credit agreements                               -            (1,000)
   Decrease in checks issued in excess of deposits                       (2,892)           (2,377)
   Proceeds from (payments on) long-term debt borrowings                (17,933)           14,286
   Proceeds from issuance of common stock                                   101               326
   Purchase of outstanding common stock                                       -               (45)
   Dividends paid - Class A Preferred                                       (62)              (87)
   Redemption of Class A Preferred stock                                 (4,095)           (3,928)
                                                                       ------------------------------
    Cash provided by (used in) financing                                (24,881)            7,175
                                                                       ------------------------------
    Net change in cash                                                      440             3,286

Cash at Beginning of Period                                               1,267               639
                                                                       ------------------------------
Cash at End of Period                                                  $  1,707          $  3,925
                                                                       ------------------------------
Supplemental Disclosures of Additional Cash Flow Information:
Cash payments for:
   Interest                                                            $ 16,905          $ 13,588
                                                                       ------------------------------
   Income taxes, net of refunds                                        $   (211)         $    280
                                                                       ------------------------------
Supplemental Schedule of Noncash Financing Activities:
   Stock dividend - Class A Preferred Stock                            $  2,845          $  2,797
                                                                       ------------------------------
</TABLE>
See Notes to Consolidated Condensed Financial Statements.
                                                5
<PAGE>
                   CONE MILLS CORPORATION AND SUBSIDIARIES
             NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS


Note 1.  Basis of Financial Statement Preparation

The Cone  Mills  Corporation  (the "Company")  consolidated
condensed  financial  statements  for  October  1,  2000 and
October  3,  1999  are  unaudited,  but  in the  opinion  of
management  reflect  all  adjustments  necessary  to present
fairly the  consolidated  condensed  balance  sheets of Cone
Mills  Corporation  and  Subsidiaries  at  October  1, 2000,
October  3, 1999,  and  January  2,  2000,  and the  related
consolidated  condensed  statements  of  operations  for the
respective  thirteen and thirty-nine  weeks ended October 1,
2000 and October 3, 1999 and cash flows for the  thirty-nine
weeks then ended.  All adjustments are of a normal recurring
nature.  The results are not  necessarily  indicative of the
results to be expected for the full year.

These  statements  should  be read in  conjunction  with the
audited  financial  statements and related notes included in
the  Company's  annual  report on Form 10-K for fiscal  year
1999.

In  December  1999,  the  staff of the  Securities  and
Exchange  Commission  issued Staff  Accounting  Bulletin No.
101, "Revenue Recognition in Financial  Statements" (SAB No.
101).   SAB  No.  101   summarizes   some  of  the   staff's
interpretations  of the  application  of generally  accepted
accounting  principles to revenue  recognition.  The Company
will adopt SAB No. 101 when  required in the fourth  quarter
of 2000.  Management  believes  the  adoption of SAB No. 101
will  not  have  a  significant   effect  on  its  financial
statements.

Inventories  are stated at the lower of cost or market.
The last-in,first-out(LIFO) method is used to determine cost
of most domestically produced goods. The first-in, first-out
(FIFO) or average cost methods are used to determine cost of
all other inventories. Because amounts for inventories under
the LIFO  method  are  based on an annual  determination  of
quantities as of the year-end, the inventories at October 1,
2000 and October 3, 1999 and related consolidated  condensed
statements  of operations  for the thirteen and  thirty-nine
weeks then ended are based on certain estimates  relating to
quantities and cost as of the end of the fiscal year.

Note 2.  Inventories
<TABLE>
<S>                                   <C>        <C>         <C>
(in thousands)                           10/1/00    10/3/99     1/2/00

Greige and finished goods              $  70,686  $  86,745   $  78,973
Work in process                            5,571      6,554       4,821
Raw materials                             21,251     13,685      15,523
Supplies and other                        12,341     11,409      11,296
                                       $ 109,849  $ 118,393   $ 110,613

                                     6
<PAGE>
Note 3.  Long-Term Debt

(in thousands)                           10/1/00     10/3/99     1/2/00

Senior Note                            $  29,209  $  32,143   $  32,144
Revolving Credit Agreement                54,000     57,000      69,000
8-1/8% Debentures                         98,020     97,575      97,685
                                         181,229    186,718     198,829
Less current maturities                   72,495     67,714      79,714
                                       $ 108,734  $ 119,004   $ 119,115
</TABLE>
On July 14, 2000, the Company  amended its Revolving  Credit
Agreement to extend the maturity date to August 7, 2001, and
provided  for the  reduction of the  availability  under the
facility.  The present Revolver  commitment has been reduced
to $73 million.  At the same time,  the Company  amended its
Senior Note debt repayment  schedule to reduce the August 7,
2000,  principal  payment of $10.7  million to $2.9  million
with  the  resulting  principal  payment  reduction  of $7.8
million  being  rolled  forward  into the  August  7,  2001,
payment.  In addition,  the interest rate on the Senior Note
was increased to 11.7% from 11.0%.

Note 4.  Class A Preferred Stock

On February  11,  2000,  the Company  declared an 8.0% stock
dividend on its Class A Preferred  Stock,  which was paid on
March  31,  2000.  The  dividend  was  charged  to  retained
earnings in the amount of  approximately  $2.8 million.  The
2001  dividend  rate for Class A Preferred  Stock is 11.75%,
payable March 31, 2001.

Note 5.  Depreciation and Amortization

The following table presents  depreciation  and amortization
included  in  the  consolidated   condensed   statements  of
operations.
<TABLE>
<S>              <C>            <C>            <C>           <C>
(in thousands)     Thirteen       Thirteen      Thirty-nine   Thirty-nine
                  Weeks Ended    Weeks Ended    Weeks Ended   Weeks Ended
                    10/1/00        10/3/99        10/1/00      10/3/99

Depreciation        $ 5,313        $ 5,709        $ 17,000     $ 18,801
Amortization            455            452           1,360        1,354
                    $ 5,768        $ 6,161        $ 18,360     $ 20,155
</TABLE>
                                      7
<PAGE>
Note 6. Earnings (Loss) Per Share

The following  table sets forth the computation of basic and
diluted earnings (loss) per common share ("EPS").
<TABLE>
<S>                                        <C>            <C>
(in thousands, except                         Thirteen       Thirteen
  per share data)                           Weeks Ended    Weeks Ended
                                              10/1/00        10/3/99

Net income (loss)                            $  1,436      $  ( 5,398)
Preferred stock dividends                      (1,047)        (   790)

Basic EPS - income (loss) available to
  common shareholders                             389         ( 6,188)
Effect of dilutive securities                       -               -

Diluted EPS - income (loss) available
  to common shareholders after assumed
  conversions                                $    389       $ ( 6,188)

Determination of shares:

Basic EPS - weighted-average shares            25,496          25,486
Effect of dilutive securities                     153               -

Diluted EPS - adjusted weighted-average
  shares after assumed conversions             25,649          25,486

Earnings (loss) per share -
   basic and diluted                         $    .02       $ (  .24)

                                    8
</TABLE>
<PAGE>
Note 6. Earnings (Loss) Per Share  (continued)

The following  table sets forth the computation of basic and
diluted loss per common share ("EPS").
<TABLE>
<S>                                          <C>            <C>
(in thousands, except                         Thirty-nine    Thirty-nine
  per share data)                             Weeks Ended    Weeks Ended
                                                10/1/00        10/3/99
Income (loss) before cumulative effect
  of accounting change                         $  2,685      $ (13,116)
Preferred stock dividends                        (2,849)       ( 2,300)

Loss before cumulative effect of accounting
  change available to common shareholders        (  164)       (15,416)
Cumulative effect of accounting change                -        ( 1,038)

Basic EPS - loss available to common
  shareholders                                   (  164)       (16,454)
Effect of dilutive securities                        -               -

Diluted EPS - loss available to common
  shareholders after assumed conversions       $ (  164)     $ (16,454)

Determination of shares:

Basic EPS - weighted-average shares              25,487         25,453
Effect of dilutive securities                         -              -

Diluted EPS - adjusted weighted-average
  shares after assumed conversions               25,487         25,453

Loss per share - basic and diluted
  Loss before cumulative effect of
    accounting change                          $ (  .01)     $ (   .61)
  Cumulative effect of accounting change              -        (   .04)

Loss per share - basic and diluted             $ (  .01)     $ (   .65)
</TABLE>
Common stock options  outstanding  at October 1, 2000,  were
not  included in the  computation  of diluted loss per share
for the thirty-nine weeks period because to do so would have
been antidilutive.  Common stock options at October 3, 1999,
were not  included in the  computation  of diluted  loss per
share because to do so would have been antidilutive.

Note 7.  Segment Information

The Company has three principal  business segments which are
based upon organizational  structure: 1) denim and khaki; 2)
commission finishing;  and 3) decorative fabrics. As part of
the 1999 comprehensive  restructuring  program,  the Company
ceased  manufacturing  yarn-dyed  products  and  exited  the
business in 1999.
                             9
<PAGE>
Operating  income  (loss) for each segment is total  revenue
less   operating   expenses   applicable   to  the  segment.
Intersegment  revenue  relates to the  commission  finishing
segment.  Equity in earnings of unconsolidated  affiliate is
included in the denim and khaki segment.  Restructuring  and
impairment   of  asset   expenses,   unallocated   expenses,
interest,  income taxes and cumulative  effect of accounting
change are not included in segment operating income (loss).

Net  sales  and  income  (loss)  from   operations  for  the
Company's operating segments are as follows:
<TABLE>
<S>                                        <C>             <C>
(in thousands)                               Thirteen        Thirteen
                                            Weeks Ended     Weeks Ended
                                              10/1/00         10/3/99
Net Sales

Denim and Khaki                             $ 132,297       $ 108,493
Commission Finishing                           17,556          20,453
Decorative Fabrics                             19,673          19,689
Yarn-Dyed Products                                  -           1,760
Other                                              83             348
                                              169,609         150,743
Less Intersegment Sales                         4,336           3,546
                                            $ 165,273       $ 147,197

Income (Loss) from Operations

Denim and Khaki                             $  10,090       $   2,380
Commission Finishing                          ( 2,031)        ( 1,993)
Decorative Fabrics                            (   178)            422
Yarn-Dyed Products                                  -         ( 1,290)
Other                                         (   141)        (   153)
Unallocated Expenses                          (   318)        ( 1,087)
                                                7,422         ( 1,721)
Restructuring and Impairment of Assets              -         ( 3,100)
                                                7,422         ( 4,821)
Less Equity in Earnings (Losses) of
  Unconsolidated Affiliate                        932         (   405)
                                                6,490         ( 4,416)
Other Expense, Net                            ( 5,726)        ( 3,385)

Income (Loss) before Income Taxes
  (Benefit), Equity in Earnings (Losses)
  of Unconsolidated Affiliate and
  Cumulative Effect of Accounting Change    $     764       $ ( 7,801)
</TABLE>
                                        10
<PAGE>
Note 7.  Segment Information (continued)
<TABLE>
<S>                                       <C>             <C>
(in thousands)                             Thirty-nine     Thirty-nine
                                           Weeks Ended     Weeks Ended
                                            10/1/00          10/3/99
Net Sales

Denim and Khaki                             $ 358,554       $ 348,366
Commission Finishing                           62,005          72,694
Decorative Fabrics                             59,195          54,037
Yarn-Dyed Products                                 10          15,831
Other                                             727           1,248
                                              480,491         492,176
Less Intersegment Sales                        11,992          13,230
                                            $ 468,499       $ 478,946
Income (Loss) from Operations

Denim and Khaki                             $  24,107       $  18,947
Commission Finishing                          ( 2,813)        ( 5,665)
Decorative Fabrics                            (   686)          1,295
Yarn-Dyed Products                            (    60)        ( 5,095)
Other                                             531         (   411)
Unallocated Expenses                          ( 1,918)        ( 4,279)
                                               19,161           4,792
Restructuring and Impairment of Assets            332         (16,017)
                                               19,493         (11,225)
Less Equity in Earnings of
  Unconsolidated Affiliate                      2,157           1,552
                                               17,336         (12,777)
Other Expense, Net                            (16,536)        ( 9,666)

Income (Loss) before Income Taxes
  (Benefit), Equity in Earnings of
  Unconsolidated Affiliate and
  Cumulative Effect of Accounting Change    $     800       $ (22,443)
</TABLE>
Note 8.  Comprehensive Income (Loss)

Comprehensive  income  (loss)  is the  total  of net  income
(loss) and other changes in equity,  except those  resulting
from  investments by owners and  distribution  to owners not
reflected in net income (loss).  Total comprehensive  income
(loss) for the periods was as follows:
<TABLE>
<S>                                  <C>             <C>
(in thousands)                          Thirteen        Thirteen
                                      Weeks Ended      Weeks Ended
                                        10/1/00          10/3/99

Net income (loss)                        $ 1,436         $ (5,398)
Other comprehensive loss,
  currency translation adjustment              -               59
                                         $ 1,436          $(5,339)
                                    11
<PAGE>
Note 8.  Comprehensive Income (Loss) (continued)

(in thousands)                        Thirty-nine      Thirty-nine
                                      Weeks Ended      Weeks Ended
                                        10/1/00          10/3/99

Net income (loss)                        $ 2,685        $ (14,154)
Other comprehensive loss,
  currency translation adjustment              -               40
                                         $ 2,685        $ (14,114)
</TABLE>
Note 9.  Securitization of Accounts Receivable

On April 24, 2000,  the Company  amended the  securitization
agreements to include certain  additional trade  receivables
related to the ongoing  purchase  and  subsequent  resale by
Cone  Receivables  II LLC.  Effective  with this  amendment,
purchases  by Redwood  Receivables  Corporation  may provide
proceeds  of up to $60  million at any point in time.  As of
October  1, 2000,  the total  amount  outstanding  under the
Accounts   Receivable   Facility  was  approximately   $57.9
million.

Note 10.  Cumulative Effect of Accounting Change

Beginning in fiscal year 1999, the Company adopted Statement
of  Position  ("SOP")  98-5,  "Reporting  on  the  Costs  of
Start-up  Activities,"  which requires future start-up costs
to  be  expensed  as  incurred  and  previously  capitalized
start-up costs to be expensed when SOP 98-5 is adopted.  The
Company  recognized a charge of $1.0 million,  the Company's
50% portion of Parras Cone's unamortized  start-up costs, as
a  cumulative  effect of an  accounting  change in the first
quarter of 1999.

Note 11.  Exchange Offer and Consent Solicitation for the 8-1/8%
          Debentures

On  August  4,  2000,  the  Company  filed  with  the SEC an
offering to holders of its 8-1/8%  Debentures  due March 15,
2005,  to exchange its common stock for up to $15 million of
the Debentures, which may be increased to $25 million at the
option  of the  Company,  and its new  secured  subordinated
debentures and its common stock for up to $85 million of the
Debentures.  The Company filed its response to SEC questions
on October 24, 2000,  and is awaiting  any further  response
from the SEC prior to the exchange offer becoming effective.
                              12
<PAGE>
Item 2.
                   MANAGEMENT'S DISCUSSION
             AND ANALYSIS OF FINANCIAL CONDITION
                  AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

Third Quarter Ended October 1, 2000 Compared with Third Quarter
Ended October 3, 1999

For the  third  quarter  of 2000,  Cone  Mills  had sales of
$165.3  million,  up 12.3% from sales of $147.2  million for
the third  quarter of 1999.  Excluding  sales of  businesses
exited in 1999,  sales for the third quarter of 2000 were up
14.8% from 1999  amounts.  The  increase in revenue over the
third quarter of 1999 was the result of a 21.9%  increase in
sales of the  denim and khaki  segment  partially  offset by
weakness in demand for commission finishing services.

Gross  profit  for the third  quarter of 2000  increased  to
10.6% of sales, as compared with 7.3% for the previous year.
The improvement in operating  results reflected the increase
in revenue and lower operating costs resulting from the 1999
comprehensive  restructuring  program. These savings include
the reconfiguration of overhead structures, restructuring at
Carlisle,  yarn  outsourcing and the exit from yarn-dyed and
piece-dyed shirting products.

Segment  Information.  The Company has three  principal
business  segments:   1)  denim  and  khaki;  2)  commission
finishing;  and 3) decorative  fabrics.  The Company  ceased
manufacturing  yarn-dyed  products  in 1999.  (See Note 7 to
Notes  to  Consolidated   Condensed   Financial   Statements
included in Part I, Item 1.)

      Denim  and  Khaki.   Denim  and  khaki  segment  sales
      revenues  for the third  quarter  of 2000 were  $132.3
      million,  up 21.9%  from  third-quarter  1999 sales of
      $108.5  million.  Sales  volume  increased by 25.8% as
      both denim and khaki  experienced  strong sales gains.
      Denim  sales  prices  were down  approximately  5%, as
      compared with the prior year. Operating income for the
      denim and khaki segment increased to $10.1 million, or
      7.6% of sales for the most recent quarter, as compared
      with  $2.4  million,  or 2.2% of sales  for the  third
      quarter  of  1999.  The  increased  earnings  resulted
      primarily  from  increased  denim  volume,   partially
      offset by lower prices, and the reduction of losses in
      khaki  operations.  Operating  income for the  segment
      includes  the equity in earnings  from the Parras Cone
      joint venture plant.

      Commission Finishing.  Outside sales of the commission
      finishing  segment  were $13.2  million  for the third
      quarter  of  2000,  down  21.8%  from  sales  of $16.9
      million  for the  third  quarter  of  1999.
                                   13
<PAGE>
      Operating losses and lower sales were experienced at
      both the Carlisle and Raytex plants, resulting from
      weak demand for prints and manufacturing  difficulties
      associated with equipment.This segment had an operating
      loss of $2.0 million in the third quarters of both 2000
      and 1999.Carlisle losses were reduced from the prior year
      as  a  result  of  overhead  reductions  and  improved
      quality   and   efficiency,    the   result   of   the
      restructuring program.

      Decorative  Fabrics.  For the third  quarter  of 2000,
      sales of the  decorative  fabrics  segment  were $19.7
      million,  as compared with third-quarter 1999 sales of
      $19.7  million.  Increased  sales  in  jacquards  were
      offset by lower  sales at John  Wolf.  The  decorative
      fabrics  segment had an operating  loss of $.2 million
      for the third  quarter of 2000, as compared with a $.4
      million  operating  profit for the previous year. John
      Wolf  sales were down as demand  declined  in 2000 for
      strong products in 1999 and restyled products are just
      now being introduced into the  marketplace.  Jacquards
      sales  increased  9.6%, but profits were effected by a
      less profitable sales mix.

      Yarn-Dyed Products.  As part of the 1999 comprehensive
      restructuring     program,    the    Company    ceased
      manufacturing   yarn-dyed   products  and  exited  the
      business in 1999. For the third quarter of 1999, sales
      of  yarn-dyed  products  were  $1.8  million  and  the
      operating loss for the segment was $1.3 million.

Selling and administrative expenses for the third quarter of
2000 were $11.1 million,  or 6.7% of sales, as compared with
$12.0 million,  or 8.1% of sales, in third quarter 1999. The
Company   continued  to  realize   benefits  from  the  1999
restructuring program.

Interest  expense  for the  third  quarter  of 2000 was $4.7
million, up 33.5% from $3.5 million for the third quarter of
1999.  The increase in interest  expense was  primarily  the
result of  increases  in rates under new lending  agreements
and  in  market  rates.   Other  expenses  of  $1.3  million
recognized  in the third  quarter  of 2000 were the  ongoing
expenses  of  the  new  accounts  receivable  securitization
program, which began in September 1999.

In the third  quarter of 2000,  income taxes as a percent of
taxable  income were 34%. In the third quarter of 1999,  the
income tax benefit as a percent of the taxable loss was 36%.

Equity in  earnings  of Parras  Cone,  the  Company's  joint
venture  plant in  Mexico,  was $.9  million  for the  third
quarter of 2000,  as compared with a loss of $.4 million for
the third quarter of 1999. The 1999 period had higher cotton
costs as a percentage of sales and additional  marketing and
management fees paid to the joint venture partners.

For the third quarter of 2000, the Company had net income of
$1.4  million as compared  to a net loss of $5.4  million in
third quarter 1999. After preferred  dividends,  the Company
reported  earnings  of $.02 per share in the 2000  period as
compared with a loss of $.24 per share in 1999.  Included in
the 1999 quarter  were  pre-tax  charges of $5.1 million for
restructuring   and  exit   inventory   charges,   resulting
primarily   from  the   implementation   of  the   Company's
turnaround plan at Carlisle.
                                14
<PAGE>
Also, there was a loss of $0.8 million associated with the
liquidation  of  remaining yarn-dyed shirting inventories.
Excluding those charges, the loss for the third quarter of
1999 was $.09 per share.

The dividend rate on the preferred stock is 11.75% for 2000
as compared with 8.00% for 1999. This increase reflects
changes in the Company's credit rating and increases in
market interest rates.

Nine Months Ended  October 1, 2000 Compared with Nine Months
Ended October 3, 1999

For the first nine  months of 2000,  Cone Mills had sales of
$468.5  million,  down 2.2% from sales of $478.9 million for
the first nine months of 1999. Excluding sales of businesses
exited in 1999, sales for the first nine months of 2000 were
up 3.0% from 1999.

Gross profit for the first nine months of 2000  increased to
11.6% of sales, as compared with 8.4% for the previous year.
The  improvement  was  primarily  due  to  better  operating
results  in the denim and  khaki  and  commission  finishing
segments  and the  realization  of  savings  from  the  1999
comprehensive restructuring program.

The Company  expected to achieve on an annual basis over $40
million   of  cost   savings   as  a  result   of  the  1999
comprehensive  downsizing and reorganization  program. These
savings include the reconfiguration of overhead  structures,
restructuring at Carlisle,  yarn outsourcing and the exit of
the  yarn-dyed and  piece-dyed  shirting  product line.  The
Company  estimates  that it has realized  approximately  $30
million  of cost  savings  through  the  third  quarter,  or
approximately $40 million of savings on an annualized basis.
Consequently,  despite  the lower  prices  for  denims,  the
Company has been able to improve gross profit.

Segment  Information.  The Company has three  principal
business  segments:   1)  denim  and  khaki;  2)  commission
finishing;  and 3) decorative  fabrics.  The Company  ceased
manufacturing  yarn-dyed  products  in 1999.  (See Note 7 to
Notes  to  Consolidated   Condensed   Financial   Statements
included in Part I, Item 1.)

      Denim  and  Khaki.   Denim  and  khaki  segment  sales
      revenues for the first nine months of 2000 were $358.6
      million,  up 2.9% from the first  nine  months of 1999
      sales of $348.4  million.  Increased  sales  volume of
      8.4%  was   partially   offset  by  lower   prices  of
      approximately    5.3%,    the   result   of   industry
      supply/demand  imbalances  in late 1999  that  lowered
      prices in 2000 and  declining  cotton costs which were
      passed on to customers  because of market  conditions.
      Operating  income for the denim and khaki  segment was
      $24.1  million,  or 6.7% of sales for the 2000 period,
      as compared with $18.9  million,  or 5.4% of sales for
      the 1999 period.  The increase resulted primarily from
      increased  denim  sales  volume,  partially  offset by
      lower  prices,  and the  reduction  of losses in khaki
      operations.  Operating income for the segment includes
      the  equity in  earnings  from the  Parras  Cone joint
      venture plant.
                                     15
<PAGE>
      Commission Finishing.  Outside sales of the commission
      finishing  segment  were $50.0  million  for the first
      nine  months of 2000,  down  15.9% from the first nine
      months of 1999.  Lower  sales at the Raytex  finishing
      plant,  resulting  from  weaker  demand in  top-of-bed
      prints,  accounted for the decline.  Operating results
      for the segment  improved as the Carlisle  plant had a
      profit,  as compared with a  significant  loss for the
      previous  year,  mitigating  the volume  shortfall and
      losses at Raytex. Losses for this segment were reduced
      from $5.7 million for the first nine months of 1999 to
      a loss of $2.8 million for the most recent period.

      Decorative Fabrics. For the first nine months of 2000,
      sales of the decorative  fabrics  segment rose by 9.5%
      to $59.2  million,  the result of continued  growth in
      jacquards.   John  Wolf  sales  were  down  as  demand
      declined  in 2000  for  strong  products  in 1999  and
      restyled  products are just now being  introduced into
      the marketplace. Due to the sales decline at John Wolf
      and a less  profitable  mix for  the  2000  period  at
      Jacquards along with manufacturing  difficulties,  the
      segment  reported an operating  loss of $.7 million in
      2000 as  compared  with an  operating  profit  of $1.3
      million in 1999.

      Yarn-Dyed Products.  As part of the 1999 comprehensive
      restructuring     program,    the    Company    ceased
      manufacturing   yarn-dyed   products  and  exited  the
      business  in 1999.  For the first nine months of 1999,
      sales of yarn-dyed products were $15.8 million and the
      operating loss for the segment was $5.1 million.

Selling  and  administrative  expenses  for the  first  nine
months  of 2000 were  $37.2  million,  or 7.9% of sales,  as
compared with $37.0  million,  or 7.7% of sales in the first
nine months of 1999.  Fees and expenses  associated with the
Company's     financial     agreements,      and     certain
performance-based  compensation accruals resulted in selling
and  administrative  expenses  increasing  as a  percent  of
sales,  partially  offset by the benefits  realized from the
1999 restructuring program.

Interest expense for the first nine months of 2000 was $14.2
million,  up 33.0%  from  $10.7  million  for the first nine
months  of  1999.  The  increase  in  interest  expense  was
primarily the result of increases in rates under new lending
agreements  and in  market  rates.  Other  expenses  of $3.2
million recognized in the first nine months of 2000 were the
ongoing   expenses   of   the   new   accounts    receivable
securitization program which began September 1999.

In the first nine months of 2000,  income taxes as a percent
of taxable  income  were 34%.  In the first  nine  months of
1999,  the  income tax  benefit as a percent of the  taxable
loss was approximately 35%.

Equity in  earnings  of Parras  Cone,  the  Company's  joint
venture plant in Mexico, was $2.2 million for the first nine
months of 2000,  as compared with $1.6 million for the first
nine  months  of 1999  before  the  cumulative  effect of an
accounting change.
                              16
<PAGE>
For the first  nine  months  of 2000,  the  Company  had net
income of $2.7  million,  or a loss of $.01 per share  after
preferred  dividends.  For  comparison,  for the first  nine
months  of 1999  the  Company  reported  a net loss of $14.2
million,  or  $.65  per  share  after  preferred  dividends.
Excluding  pre-tax  restructuring  and  related  expenses of
$16.0 million,  losses  associated with businesses exited of
$5.1  million,  and exit  inventory  losses of $3.6 million,
plus  the  after-tax  cumulative  effect  of a $1.0  million
accounting  change,  the Company  had pro forma  earnings of
$.02 per share for the first nine months of 1999.

LIQUIDITY AND CAPITAL RESOURCES

The Company's principal long-term capital components consist
of debt  outstanding  under  its  Senior  Note,  its  8-1/8%
Debentures  and  stockholders'  equity.  Primary  sources of
liquidity  are  internally  generated  funds,  a $73 million
Revolving Credit Facility  ("Revolving Credit Facility") and
a $60 million  Receivables  Purchase and Servicing Agreement
(the "Receivables  Agreement")  entered into on September 1,
1999, and amended on April 24, 2000,  with Cone  Receivables
II LLC, Redwood  Receivables  Corporation  ("Redwood"),  and
General Electric Capital Corporation.

On January  28,  2000,  the Company  entered  into a new $80
million  Revolving  Credit  Facility with its existing banks
with  Bank of  America,  N.A.,  as  agent,  ratably  secured
together with the Senior Note and the 8-1/8% Debentures,  by
substantially  all  of the  Company  assets.  The  Revolving
Credit  Facility  was amended on July 14, 2000 to extend the
maturity date from August 7, 2000 to August 7, 2001,  and to
revise the covenants.  The present Revolving Credit Facility
Agreement  commitment  has  been  reduced  to  $73  million,
including  letters of  credit,  as a result of the August 7,
2000,  Senior  Note  payment  and the sale of the  corporate
headquarters  building.  The  Company  may,  at its  option,
borrow  from  time  to  time  under  the  Revolving   Credit
Agreement at a Base Rate or a Eurodollar Rate, each based on
a formula set forth in the agreement.

On April 24,  2000,  the  Company  amended  the  Receivables
Agreement  increasing  the facility  from $50 million to $60
million.  In  addition to  increasing  the  commitment,  the
Company  modified other provisions of the Agreement to allow
it to utilize more fully the entire facility.

On July 14,  2000 the  Company  amended its Senior Note debt
repayment  schedule to reduce the August 7, 2000,  principal
payment of $10.7  million to $2.9 million with the resulting
principal  payment  reduction of $7.8  million  being rolled
forward into the August 7, 2001, payment.  The interest rate
on the Senior Note was increased to 11.7% from 11.0%.

The  following  is  a  summary  of  the  Company's   primary
financing agreements as of October 1, 2000.
                               17
<PAGE>
<TABLE>
<S>                      <C>         <C>          <C>             <C>
($ Amounts in Millions)    Facility      Amount      Interest/       Maturity
Financing Agreement       Commitment  Outstanding  Discount Rate       Date

8-1/8% Debenture           $100.0       $100.0        8.125%       Mar 15, 2005
Senior Note                  29.2         29.2       11.700        Aug 13, 2002
Revolving Credit             73.0         54.0       11.250        Aug  7, 2001
Receivables Agreement        60.0         57.9        8.163        Sept 1, 2004
</TABLE>
In the third quarter of 2000, the Company completed the sale
of its corporate  headquarters site to VF Corporation.  Cone
Mills expects to vacate the site at the end of 2001 and move
into  substantially  smaller space, thus reducing its annual
occupancy  costs.  This  transaction  allowed the Company to
terminate a lease arrangement and related  obligations  of
approximately $15 million.

Financing  agreements  of the Company  prohibit  the Company
from paying dividends on its Common Stock.

During the first nine months of 2000, the Company  generated
cash from operations,  before changes in working capital, of
$20.3  million,  as compared  with $3.4  million  during the
first  nine  months  of 1999.  In the 2000  period,  working
capital decreased by $11.8 million. Uses of cash in the 2000
period   included   $9.4   million  for   domestic   capital
expenditures  and investments to develop the Company's joint
venture  industrial park in Mexico, and $4.1 million for the
redemption of preferred stock.

The Company  believes that  internally  generated  operating
cash flow and funds  available  under its  Revolving  Credit
Facility  will be  sufficient  to meet its needs for working
capital,  capital spending  permitted under the terms of the
Revolving  Credit Facility and debt repayments  until August
2001, when the Revolving Credit Facility expires.  Liquidity
is predicated on the Company's meeting its operating targets
in 2000 and further reductions in inventories.

On  August  4,  2000,  the  Company  filed  with  the  SEC a
registration  statement  relating to a proposed  offering to
holders  of its 8-1/8%  Debentures  due March 15,  2005,  to
exchange  its  common  stock  for up to $15  million  of the
debentures,  which may be  increased  to $25  million at the
option  of the  Company,  and its new  secured  subordinated
debentures  and  common  stock for up to $85  million of the
debentures.  In addition, the exchange includes a consent to
make certain  changes in the indenture  governing the 8-1/8%
Debentures  and  a  release  of  the  collateral   currently
securing the  debentures,  which  require  acceptance of the
exchange  offer by  holders  of more than 50% of the  8-1/8%
Debentures.  The principal  purpose of the proposed exchange
offer is to enable the Company to revise its debt  structure
in a manner that should provide more  flexibility and should
permit the  Company to obtain  financing  necessary  for its
proposed  expansion  into  Mexico.  The  Company  expects to
replace certain of its existing financing agreements with an
asset-based   lending   facility   that  will  contain  less
restrictive   covenants  and  lower  interest  costs.   This
facility   should  enable  the  Company  to  obtain  project
financing for a portion of its proposed  Mexican  expansion.
                              18
<PAGE>
While management believes that it will be able to obtain the
asset-based  facility and the Mexican  project  financing if
the exchange offer is successful, there is no assurance that
the Company will obtain  financing  on terms and  conditions
acceptable to the Company.  On October 24, 2000, the Company
amended  the  August  4,  2000  filing  in  response  to SEC
comments  regarding the original  filing.  The  registration
statement  relating to the proposed  exchange  offer has not
yet become effective and, therefore,  the exchange offer has
not commenced.

On  October  1,  2000,  the  Company's   long-term   capital
structure  consisted  of $181.2  million of  long-term  debt
(including   current   maturities)  and  $156.3  million  of
stockholders'  equity.  For comparison,  on October 3, 1999,
the Company had $186.7 million of long-term debt  (including
current  maturities)  and $164.2  million  of  stockholders'
equity.  Long-term debt (including current  maturities) as a
percentage of long-term  debt and  stockholders'  equity was
54% at October 1, 2000,  as compared  with 53% at October 3,
1999.

Accounts  receivable on October 1, 2000, were $48.1 million,
as  compared   with  $48.8   million  at  October  3,  1999.
Receivables,   including   those   sold   pursuant   to  the
Receivables Purchase Agreement, represented 61 days of sales
outstanding  at  October  1, 2000 and 63 days at  October 3,
1999.

Inventories  on October 1, 2000,  were  $109.8  million,  as
compared  with  $118.4  million  at  October  3,  1999.  The
decrease   reflects  lower   finished   goods   inventories,
primarily   denims,   partially   offset  by  increased  raw
materials.

For the first nine months of 2000, domestic capital spending
was  $4.2  million  compared  to $8.0  million  for the 1999
period.  Domestic capital spending in 2000 is expected to be
approximately $10 million.  In addition to the 2000 domestic
capital  spending  budget,  the  Company  expects  to  spend
approximately  $8 million for  investments in  international
initiatives  of which $5.2 million was invested in the first
nine months of 2000.

OTHER MATTERS

During  the  third  quarter  the  Company  reached  a mutual
agreement with Ashima Ltd., a company  located in India,  to
terminate   certain   Commercial   and  Technical   Services
Agreements  between the  parties.  As a result of changes in
the marketplace  relating to the Asian financial  crisis and
the  Company's  refocus  on  the  Western  Hemisphere,   the
alliance did not have the profit  potential for both parties
that was initially envisioned.  The Company will continue to
hold its equity  investment in Ashima and maintain an active
relationship  so as to keep a presence in that region of the
world  and  potentially  benefit  from a  change  in  market
dynamics.
                                19
<PAGE>
Federal,   state  and  local  regulations  relating  to  the
workplace   and  the   discharge  of   materials   into  the
environment  continue  to change  and,  consequently,  it is
difficult  to  gauge  the  total   future   impact  of  such
regulations on the Company.  Existing government regulations
are not expected to cause a material change in the Company's
competitive  position,  operating results or planned capital
expenditures.   The  Company  has  an  active  environmental
committee,  which fosters  protection of the environment and
compliance with laws.

The Company is a party to various  legal claims and actions.
Management  believes  that none of these  claims or actions,
either  individually  or  in  the  aggregate,  will  have  a
material  adverse  effect on the financial  condition of the
Company.

"Safe Harbor"  Statement under Section 27A of the Securities
Act of 1933, as amended,  and Section 21E of the  Securities
Exchange Act of 1934, as amended.

      Except for the historical information  presented,  the
      matters  disclosed  in the  foregoing  discussion  and
      analysis  and  other  parts  of  this  report  include
      forward-looking statements. These statements represent
      the Company's  current  judgment on the future and are
      subject to risks and  uncertainties  that could  cause
      actual  results  to differ  materially.  Such  factors
      include,  without  limitation:   (i)  the  demand  for
      textile  products,  including the Company's  products,
      will vary with the U.S.  and  world  business  cycles,
      imbalances  between consumer demand and inventories of
      retailers  and  manufacturers  and  changes in fashion
      trends,  (ii) the  highly  competitive  nature  of the
      textile  industry and the possible  effects of reduced
      import  protection and free-trade  initiatives,  (iii)
      the  unpredictability  of the cost and availability of
      cotton, the Company's principal raw material, (iv) the
      Company's relationships with Levi Strauss as its major
      customer,  (v) the  Company's  ability to attract  and
      maintain  adequate  capital  to  fund  operations  and
      strategic  initiatives,  (vi) successful completion of
      the Exchange  Offer for the 8-1/8%  Debentures,  (vii)
      increases in prevailing interest rates, and (viii) the
      Company's  inability  to  continue  the  cost  savings
      associated with its restructuring  initiatives.  For a
      further  description  of these risks see the Company's
      1999 Form 10-K, "Item 1. Business  -Competition,  -Raw
      Materials and -Customers" and "Management's Discussion
      and Analysis of Results of  Operations  and  Financial
      Condition  --  Overview"  of Item 7. of the Form 10-K.
      Other risks and  uncertainties  may be described  from
      time  to  time  in the  Company's  other  reports  and
      filings with the Securities and Exchange Commission.

Item 3.  Quantitative and Qualitative Disclosures about Market Risk

The  Company  is  exposed  to  market   risks   relating  to
fluctuations in interest rates and commodity  prices.  There
has been no material  change in the  Company's  market risks
that would significantly  affect the disclosures made in the
Form 10-K for the year ended January 2, 2000.
                                    20
<PAGE>
                           PART II

Item 1.  Legal Proceedings

The  Company  and its  subsidiaries  are  involved  in legal
proceedings  and claims  arising in the  ordinary  course of
business.  Although  there  can  be no  assurance  as to the
ultimate  disposition of these matters,  management believes
that the probable  resolution of such contingencies will not
have a material adverse effect on the financial condition of
the Company.

Item 6.  Exhibits and Reports on Form 8-K

(a)   The exhibits to this Form 10-Q are listed in the accompanying
      Index to Exhibits.
(b)   Reports on Form 8-K.
      None

                                      21
<PAGE>
<TABLE>
<S>       <C>                                             <C>
Exhibit                                                    Sequential
  No.      Description                                      Page No.

*2.1       Receivables Purchase and Servicing
           Agreement dated as of September 1, 1999,
           by and among Cone Receivables II LLC,
           as Seller, Redwood Receivables
           Corporation, as Purchaser, the Registrant,
           as Servicer, and General Electric Capital
           Corporation, as Operating Agent and
           Collateral Agent, filed as Exhibit 2.1(h)
           to Registrant's report on Form 10-Q
           for the quarter ended October 3, 1999.

*2.2       Receivables   Transfer   Agreement  dated  as  of
           September 1, 1999,  by and among the  Registrant,
           any  other  Originator  Party  hereto,  and  Cone
           Receivables  II LLC,  filed as Exhibit  2.1(i) to
           Registrant's  report on Form 10-Q for the quarter
           ended October 3, 1999.

*2.3.1     First Amendment and Waiver to Securitization
           Agreements dated as of November 16, 1999, by
           and between Cone Receivables II LLC, the
           Registrant, Redwood Receivables Corporation
           and General Electric Capital Corporation,
           together with all exhibits thereto, filed as
           Exhibit 2.1(c) to Registrant's report on Form
           10-K for the fiscal year ending January 2, 2000.

*2.3.2     Second Amendment to Securitization Agreements
           dated as of January 28, 2000, by and between
           Cone Receivables II LLC, the Registrant, Redwood
           Receivables Corporation, and General Electric
           Capital Corporation, together will all exhibits
           thereto, filed as Exhibit 2.1(d) to Registrant's
           report on Form 10-K for the fiscal year ending
           January 2, 2000.

*2.3.3     Third Amendment to Securitization Agreements
           dated as of March 31, 2000, by and between
           Cone Receivables II LLC, the Registrant,
           Redwood Receivables Corporation, and General
           Electric Capital Corporation, together with all
           Exhibits thereto, filed as Exhibit 2.1(e) to
           Registrant's report on Form 10-Q for the quarter
           ended April 2, 2000.

*2.3.4     Fourth Amendment to Securitization Agreements
           dated as of April 24, 2000 by and between Cone
           Receivables II LLC, the Registrant, Redwood
                                       22
<PAGE>
 Exhibit                                                   Sequential
 No.       Description                                      Page No.

           Receivables  Corporation,  and  General  Electric
           Capital  Corporation,  together with all exhibits
           thereto,  filed as Exhibit 2.1(f) to Registrant's
           report on Form 10-Q for the  quarter  ended April
           2, 2000.

*2.3.5     Fifth  Amendment  to  Securitization   Agreements
           dated as of June  30,  2000 by and  between  Cone
           Receivables  II  LLC,  the  Registrant,   Redwood
           Receivables  Corporation,  and  General  Electric
           Capital  Corporation,  filed as Exhibit  2.3.5 to
           Registrant's  Registration  statement on Form S-4
           (File No. 333-43014).

*2.4       Investment Agreement dated as of June 18, 1993,
           among Compania Industrial de Parras, S.A. de C.V.,
           Sr. Rodolfo Garcia Muriel, and the Registrant,
           filed as Exhibit 2.2(a) to Registrant's report
           on Form 10-Q for the quarter ended July 4, 1993.

*2.5       Commercial Agreement dated as of July 1, 1999,
           among Compania Industrial de Parras, S.A. de C.V.,
           the Registrant, and Parras Cone de Mexico, S.A.,
           filed as Exhibit 2.2(b) to Registrant's report on
           Form 10-K for the fiscal year ending January 2,
           2000.

*2.6       Guaranty Agreement dated as of June 25, 1993,
           between the Registrant and Compania Industrial
           de Parras, S.A. de C.V., filed as Exhibit 2.2(c)
           to Registrant's report on Form 10-Q for the
           quarter ended July 4, 1993.

*2.7       Joint Venture Agreement dated as of June 25,
           1993, between Compania Industrial de Parras,
           S.A. de C.V., and Cone Mills (Mexico), S.A. de
           C.V., filed as Exhibit 2.2(d) to Registrant's
           report on Form 10-Q for the quarter ended July
           4, 1993.

*2.7.1     First Amendment to Joint Venture Agreement dated
           as of June 14, 1995, between Compania Industrial
           de Parras, S.A. de C.V., and Cone Mills (Mexico),
           S.A. de C.V., filed as Exhibit 2.2(e) to the
           Registrant's report on Form 10-Q for the quarter
           ended July 2, 1995.

*2.8       Joint Venture Registration Rights Agreement dated
           as of  June 25, 1993, among Parras Cone de Mexico,
                                        23
<PAGE>
 Exhibit                                                   Sequential
  No.      Description                                      Page No.

           S.A., Compania Industrial de Parras, S.A. de
           C.V. and Cone Mills (Mexico), S.A. de C.V.,
           filed as Exhibit 2.2(e) to Registrant's report
           on Form 10-Q for the quarter ended July 4, 1993.

*2.9       Parras Registration Rights Agreement
           dated as of June 25, 1993, between Compania
           Industrial de Parras, S.A. de C.V. and
           the Registrant, filed as Exhibit
           2.2(f) to the Registrant's report on Form
           10-Q for the quarter ended July 4, 1993.

*2.10      Support  Agreement  dated  as of June  25,  1993,
           among the Registrant,  Sr. Rodolfo L. Garcia, Sr.
           Rodolfo  Garcia  Muriel and certain other persons
           listed therein ("private stockholders"), filed as
           Exhibit  2.2(g)  to  Registrant's  report on Form
           10-Q for the quarter ended July 4, 1993.

*3.1       Restated   Articles  of   Incorporation   of  the
           Registrant  effective  August 25, 1993,  filed as
           Exhibit 4.1 to  Registrant's  report on Form 10-Q
           for the quarter ended October 3, 1993.

*3.1.1     Articles of Amendment of the Articles of
           Incorporation of the Registrant effective
           October 22, 1999, to fix the designation,
           preferences, limitations, and relative
           rights of a series of its Class B Preferred
           Stock, filed as Exhibit 4.1(a) to Registrant's
           report on Form 10-Q for the quarter ended
           October 3, 1999.

*3.2       Amended and Restated Bylaws of Registrant,
           effective June 18, 1992, filed as Exhibit
           3.5 to the Registrant's Registration
           Statement on Form S-1 (File No. 33-46907).

*4.1       Rights Agreement dated as of October 14,
           1999, between the Registrant and First
           Union National Bank, as Rights Agent,
           with Form of Articles of Amendment with
           respect to the Class B Preferred Stock
           (Series A), the Form of Rights Certificate,
           and Summary of Rights attached, filed as
           Exhibit 1 to the Registrant's report on Form
           8-A dated October 29, 1999.
                                      24
<PAGE>
Exhibit                                                    Sequential
  No.      Description                                      Page No.

*4.2       Note  Agreement  dated  as of  August  13,  1992,
           between  the   Registrant   and  The   Prudential
           Insurance  Company  of  America,  with form of 8%
           promissory  note attached,  filed as Exhibit 4.01
           to the  Registrant's  report  on Form  8-K  dated
           August 13, 1992.

*4.2.1     Letter   Agreement   dated  September  11,  1992,
           amending  the Note  Agreement  dated  August  13,
           1992,  between the  Registrant and The Prudential
           Insurance  Company of  America,  filed as Exhibit
           4.2 to the Registrant's  report on Form 8-K dated
           March 1, 1995.

*4.2.2     Letter  Agreement  dated July 19, 1993,  amending
           the Note Agreement dated August 13, 1992, between
           the  Registrant  and  The  Prudential   Insurance
           Company of  America,  filed as Exhibit 4.3 to the
           Registrant's  report on Form 8-K  dated  March 1,
           1995.

*4.2.3     Letter  Agreement  dated June 30, 1994,  amending
           the Note Agreement dated August 13, 1992, between
           the  Registrant  and  The  Prudential   Insurance
           Company of  America,  filed as Exhibit 4.4 to the
           Registrant's  report on Form 8-K  dated  March 1,
           1995.

*4.2.4     Letter   Agreement   dated   November  14,  1994,
           amending  the Note  Agreement  dated  August  13,
           1992,  between the  Registrant and The Prudential
           Insurance  Company of  America,  filed as Exhibit
           4.5 to the Registrant's  report on Form 8-K dated
           March 1, 1995.

*4.2.5     Letter  Agreement  dated  as of  June  30,  1995,
           amending  the Note  Agreement  dated  August  13,
           1992,  between the  Registrant and The Prudential
           Insurance  Company of  America,  filed as Exhibit
           4.3(e)  to the  Registrant's  report on Form 10-Q
           for the quarter ended July 2, 1995.

*4.2.6     Letter Agreement dated as of June 30,
           1995, between the Registrant and
                                     25
<PAGE>
Exhibit                                                    Sequential
  No.      Description                                      Page No.

           The  Prudential   Insurance  Company  of  America
           superseding  Letter  Agreement,  filed as Exhibit
           4.3(e)  to the  Registrant's  report on Form 10-Q
           for the quarter ended July 2, 1995.

*4.2.7     Letter  Agreement  dated  as of March  30,  1996,
           between  the   Registrant   and  The   Prudential
           Insurance  Company of  America,  filed as Exhibit
           4.3(g)  to the  Registrant's  report on Form 10-Q
           for the quarter ended March 31, 1996.

*4.2.8     Letter  Agreement  dated as of January 31,  1997,
           between  the   Registrant   and  The   Prudential
           Insurance  Company of  America,  filed as Exhibit
           4.3(h)  to the  Registrant's  report on Form 10-K
           for the year ended December 29, 1996.

*4.2.9     Letter  Agreement  dated  as of  July  31,  1997,
           between  the   Registrant   and  The   Prudential
           Insurance  Company of  America,  filed as Exhibit
           4.3(i)  to the  Registrant's  report on Form 10-Q
           for the quarter ended September 28, 1997.

*4.2.10    Modification   to  Note  Agreement  dated  as  of
           February 14, 1998, between the Registrant and The
           Prudential Insurance Company of America, filed as
           Exhibit  4.3(j)  to  Registrant's  report on Form
           10-Q for the quarter ended March 29, 1998.

*4.2.11    Letter  Agreement  dated as of September 1, 1999,
           amending  the Note  Agreement  dated  August  13,
           1992,  between the  Registrant and The Prudential
           Insurance  Company of  America,  filed as Exhibit
           4.3(i) on Form 10-Q for the quarter ended October
           3, 1999.

*4.2.12    Amendment  of 1992  Note  Agreement  dated  as of
           January 28, 2000, by and among the Registrant and
           The  Prudential  Insurance  Company  of  America,
           together  with  all  exhibits  thereto,  filed as
           Exhibit 9 to the Registrant's  report on Form 8-K
           dated February 11, 2000.
                                     26
<PAGE>
Exhibit                                                    Sequential
  No.      Description                                      Page No.

*4.2.13    Waiver under Note  Agreement  dated as of July 3,
           2000,  by  and  among  the   Registrant  and  The
           Prudential Insurance Company of America, filed as
           Exhibit  4.2.13  to   Registrant's   Registration
           Statement on Form S-4 (File 333-43014)

*4.2.14    Amendment of 1992 Note Agreement dated as of July
           14,  2000,  by and among the  Registrant  and The
           Prudential Insurance Company of America, filed as
           Exhibit 4.2.14 to Registrant's Registration
           Statement on Form S-4 (File 333-43014)

*4.3       Credit Agreement dated as of January 28, 2000, by
           and among the  Registrant,  as Borrower,  Bank of
           America,  N.A.,  as Agent and as  Lender  and the
           Lenders party thereto from time to time, together
           with all exhibits thereto,  filed as Exhibit 1 to
           the   Registrant's   report  on  Form  8-K  dated
           February 11, 2000.

*4.3.1     Amendment No. 1 to Credit Agreement dated as
           of July 14, 2000, by and among the Registrant,
           as Borrower, Cone Global Finance Corp., CIPCO
           S.C. Inc. and Cone Foreign Trading LLC, as
           Guarantors, Bank of America, N.A., as Agent and
           as Lender, and the Lenders party thereto from
           time to time, filed as Exhibit 4.3.1 to
           Registrant's Registration Statement on Form S-4
           (File 333-43014)

*4.4       Guaranty Agreement dated as of January 28,
           2000, made by Cone Global Finance Corporation,
           CIPCO S.C., Inc. and Cone Foreign Trading
           LLC in favor of Bank of America, N.A.
           as Revolving Credit Agent for the Lenders,
           The Prudential Insurance Company of America,
           SunTrust Bank, Morgan Guaranty Trust
           Company of New York, Wilmington Trust
           Company, as General Collateral Agent,
           Bank of America, N.A., as Priority
           Collateral Agent, and Atlantic Financial
           Group, Ltd., together with all exhibits
           thereto, filed as Exhibit 2 to the
           Registrant's report on Form 8-K dated
           February 11, 2000.

*4.5       Priority Security Agreement dated as of
           January 28, 2000, by the Registrant
                                      27
<PAGE>
Exhibit                                                    Sequential
  No.      Description                                      Page No.

           and certain of its subsidiaries, as Grantors, and
           Bank of America,  N.A.,  as  Priority  Collateral
           Agent, together with all exhibits thereto,  filed
           as Exhibit 3 to the  Registrant's  report on Form
           8-K dated February 11, 2000.

*4.6       General  Security  Agreement  dated as of January
           28,2000,  by the  Registrant  and  certain of its
           subsidiaries,  as Grantors,  and Wilmington Trust
           Company,  as General  Collateral Agent,  together
           with all exhibits thereto,  filed as Exhibit 4 to
           the   Registrant's   report  on  Form  8-K  dated
           February 11, 2000.

*4.7       Securities  Pledge  Agreement dated as of January
           28,  2000,   by  the   Registrant   in  favor  of
           Wilmington Trust Company,  as General  Collateral
           Agent, together with all exhibits thereto,  filed
           as Exhibit 5 to the  Registrant's  report on Form
           8-K dated February 11, 2000.

*4.8       CMM  Pledge  Agreement  dated as of  January  28,
           2000,  by the  Registrant  in favor of Wilmington
           Trust  Company,   as  General  Collateral  Agent,
           together  with  all  exhibits  thereto,  filed as
           Exhibit 6 to the Registrant's  Report on Form 8-K
           dated February 11, 2000.

*4.9       Deed of Trust, Security Agreement, Fixture
           Filing, Assignment of Leases and Rents and
           Financing Statement dated as of January 28,
           2000, between the Registrant, as Grantor,
           TIM, Inc., as Trustee, Wilmington Trust
           Company, as General Collateral Agent, and
           Bank of America, N.A., as Designated
           Collateral Subagent, together with all
           exhibits thereto, filed as Exhibit 7 to
           the Registrant's report on Form 8-K dated
           February 11, 2000.

*4.10      Deed of Trust, Security Agreement, Fixture
           Filing, Assignment of Leases and Rents and
           Financing Statement dated as of January 28,
           2000, between the Registrant, as Grantor,
           TIM, Inc., as Trustee, and Bank of America,
           N.A., as Priority Collateral Agent, together
           with all exhibits thereto, filed as Exhibit
           8 to the Registrant's report on Form 8-K dated
           February 11, 2000.
                                      28
<PAGE>
Exhibit                                                    Sequential
  No.      Description                                      Page No.

*4.11      Termination  Agreement  dated as of  January  28,
           2000,  between the Registrant and Morgan Guaranty
           Trust  Company of New York,  as Agent for various
           banks  terminating  the Credit Agent dated August
           7, 1997, filed as Exhibit  4.4(h)  to  Registrant's
           report on Form 10-K for the fiscal year ending
           January 2, 2000.

*4.12      Specimen Class A Preferred Stock Certificate,
           filed as Exhibit 4.5 to the Registrant's
           Registration Statement on Form S-1(File No.
           33-46907).

*4.13      Specimen Common Stock Certificate, effective
           June 18, 1992, filed as Exhibit 4.7 to the
           Registrant's Registration Statement on Form S-1
           (File No. (33-46907).

*4.14      Cone Mills  Corporation  1983 ESOP as amended and
           restated  effective  December  1, 1994,  filed as
           Exhibit  4.9 to the  Registrant's  report on Form
           10-K for year ended January 1, 1995.

*4.14.1    First  Amendment  to the Cone  Mills  Corporation
           1983 ESOP  dated May 9,  1995,  filed as  Exhibit
           4.9(a)  to the  Registrant's  report on Form 10-K
           for year ended December 31, 1995.

*4.14.2    Second  Amendment  to the Cone Mills  Corporation
           1983  ESOP  dated  December  5,  1995,  filed  as
           Exhibit 4.9(b) to the Registrant's report on Form
           10-K for year ended December 31, 1995.

*4.14.3    Third  Amendment  to the Cone  Mills  Corporation
           1983 ESOP dated August 7, 1997,  filed as Exhibit
           4.8(c)  to the  Registrant's  report on Form 10-Q
           for the quarter ended September 28, 1997.

*4.14.4    Fourth  Amendment  to the Cone Mills  Corporation
           1983  ESOP  dated  December  4,  1997,  filed  as
           Exhibit 4.8(d) to the Registrant's report on Form
           10-K for the year ended December 28, 1997.

*4.15      Indenture dated as of February 14, 1995, between
           the Registrant and Wachovia Bank of North Carolina,
           N.A. as Trustee (The Bank of New York is successor
           Trustee), filed as Exhibit 4.1 to Registrant's
                                   29
<PAGE>
Exhibit                                                    Sequential
  No.      Description                                      Page No.

           Registration Statement on Form S-3 (File No.
           33-57713).

*4.15.1    Form of First Supplemental Indenture to the
           Indenture dated as of February 14, 1995,
           Between the Registrant and Wachovia Bank of
           North Carolina, N.A. as Trustee (The Bank of
           New York is successor Trustee), with respect
           to the 8-1/8% Debentures Due March 15, 2005,
           filed as Exhibit 4.15.1 to Registrant's
           Registration Statement on Form S-4
           (File 333-43014).

*4.16      Form of Indenture  between the Registrant and The
           Bank of New York, as Trustee, with respect to the
           11% Secured Subordinated Debentures Due March 15,
           2005 being  registered,  filed as Exhibit 4.16 to
           Registrant's  Registration  Statement on Form S-4
           (File 333-43014).

Management contract or compensatory plan or arrangement
(Exhibits 10.1 - 10.13)

*10.1      Employees'   Retirement   Plan  of   Cone   Mills
           Corporation  as amended  and  restated  effective
           December  1, 1994,  filed as Exhibit  10.1 to the
           Registrant's  report  on Form  10-K  for the year
           ended January 1, 1995.

*10.1.1    First Amendment to the Employees' Retirement Plan
           of Cone Mills Corporation dated May 9,1995, filed
           as Exhibit 10.1(a) to the Registrant's  report on
           Form 10-K for the year ended December 31, 1995.

*10.1.2    Second  Amendment  to the  Employees'  Retirement
           Plan of Cone Mills  Corporation dated December 5,
           1995,   filed   as   Exhibit   10.1(b)   to   the
           Registrant's  report  on Form  10-K  for the year
           ended December 31, 1995.

*10.1.3    Third Amendment to the Employees' Retirement Plan
           of Cone Mills  Corporation dated August 16, 1996,
           filed  as  Exhibit  10.1(c)  to the  Registrant's
           report on Form 10-K
                                       30
<PAGE>
Exhibit                                                    Sequential
  No.      Description                                      Page No.

           for the year ended December 29, 1996.

*10.1.4    Fourth  Amendment  to the  Employees'  Retirement
           Plan of Cone Mills Corporation,  filed as Exhibit
           10 to the  Registrant's  report  on Form 10-Q for
           the quarter ended September 28, 1997.

*10.1.5    Fifth Amendment to Employees'  Retirement Plan of
           Cone Mills  Corporation  dated  December 4, 1997,
           filed  as  Exhibit  10.1(e)  to the  Registrant's
           report on Form 10-K for the year  ended  December
           28, 1997.

*10.7      Cone  Mills   Corporation  SERP  as  amended  and
           restated as of December 5, 1995, filed as Exhibit
           10.2 to the Registrant's  report on Form 10-K for
           the year ended December 31, 1995.

*10.8      Excess Benefit Plan of Cone Mills  Corporation as
           amended  and  restated  as of  December  5, 1995,
           filed as Exhibit 10.3 to the Registrant's  report
           on Form  10-K for the  year  ended  December  31,
           1995.

*10.9      1984 Stock Option Plan of Registrant filed as
           Exhibit 10.7 to the Registrant's Registration
           Statement on Form S-1 (File No. 33-28040).

*10.10     Form of Nonqualified Stock Option Agreement under
           1984 Stock Option Plan of Registrant, filed as
           Exhibit 10.8 to the Registrant's Registration
           Statement on Form S-1 (File No. 33-28040).

*10.11     Form of Incentive Stock Option Agreement under
           1984 Stock Option Plan of Registrant, filed as
           Exhibit 10.9 to the Registrant's Registration
           Statement on Form S-1 (File No. 33-28040).

*10.12     1992 Stock  Option Plan of  Registrant,  filed as
           Exhibit 10.9 to the  Registrant's  report on Form
           10-K for the year ended December 29, 1991.

*10.12.1   Amended and  Restated  1992 Stock Plan,  filed as
           Exhibit 10.1 to Registrant's  report on Form 10-Q
           for the quarter ended March 31, 1996.

*10.13     Form of Incentive Stock Option Agreement under
           1992 Stock Option Plan, filed as Exhibit 10.10 to
                                       31
<PAGE>
Exhibit                                                    Sequential
  No.      Description                                      Page No.

           the Registrant's report on Form 10-K for the year
           ended January 3, 1993.

*10.14     Form of Nonqualified Stock Option Agreement under
           1992 Stock Option Plan,  filed as Exhibit 10.8(a)
           to the  Registrant's  report on Form 10-K for the
           year ended December 29,1996.

*10.14.1   Form of Nonqualified Stock Option Agreement under
           1992  Amended and Restated  Stock Plan,  filed as
           Exhibit  10.8(b)  to the  Registrant's  report on
           Form 10-K for the year ended December 29, 1996.

*10.15     Form of Restricted  Stock Award  Agreement  under
           1992  Amended and Restated  Stock Plan,  filed as
           Exhibit  10.8(c)  to the  Registrant's  report on
           Form 10-K for the year ended December 28, 1997.

*10.16     1994 Stock Option Plan for Non-Employee Directors
           of   Registrant,   filed  as   Exhibit   10.9  to
           Registrant's  report  on Form  10-K  for the year
           ended January 2, 1994.

*10.17     Form  of  Non-Qualified  Stock  Option  Agreement
           under 1994  Stock  Option  Plan for  Non-Employee
           Directors of  Registrant,  filed as Exhibit 10.10
           To Registrant's  report on Form 10-K for the year
           Ended January 2, 1994.

*10.18     Management  Incentive  Plan  of  the  Registrant,
           filed as Exhibit 10.11(b) to Registrant's  report
           on Form 10-K for the year ended January 3, 1993.

*10.19     1997  Senior  Management  Incentive  Compensation
           Plan,  filed  as  Exhibit  10.2  to  Registrant's
           report on Form 10-Q for the  quarter  ended March
           31, 1996.

*10.20     1997 Senior Management  Discretionary Bonus Plan,
           filed as Exhibit 10.13 to the Registrant's report
           on Form  10-K for the  year  ended  December  29,
           1996.

*10.21     2000  Stock  Compensation  Plan for  Non-Employee
           Directors of Registrant  dated as of May 9, 2000,
           filed as Exhibit 10.18 to Registrant's  report on
           Form 10-Q for the quarter ended April 7, 2000.

*10.22     Form of Agreement between the Registrant and
           Levi Strauss dated as of March 30, 1992, filed as
                                    32
</TABLE>
<PAGE>
Exhibit                                                    Sequential
  No.      Description                                      Page No.

           Exhibit 10.14 to the Registrant's Registration
           Statement on Form S-1 (File No. 33-46907).

*10.23     First  Amendment to Supply  Agreement dated as of
           April 15, 1992,  between the  Registrant and Levi
           Strauss  dated as of  March  30,  1992,  filed as
           Exhibit   10.15  to   Registrant's   Registration
           Statement on Form S-1 (No. 33-46907).

*10.24     Agreement  dated  January  1, 1999,  between  the
           Registrant  and Parkdale  Mills,  Inc.,  filed as
           Exhibit 10.17 to Registrant's report on Form 10-K
           for the year ended January 2, 2000.

*10.25     Tenth  Amendment  to  Master  Lease  dated  as of
           January  28,  2000,  between  Atlantic  Financial
           Group, Ltd. and the Registrant, together with all
           exhibits   thereto,   filed  as   Exhibit  10  to
           Registrant's  report on Form 8-K  dated  February
           11, 2000.

*10.25.1   Eleventh Amendment to Master Lease dated as
           of July 14, 2000 between Atlantic Financial
           Group, Ltd. and the Registrant, filed as
           Exhibit 10.25.1 to Registrant's Registration
           Statement on Form S-4 (File No. 333-43014).

10.25.2    Assignment and Termination Agreement dated
           as of August 31, 2000, among Atlantic
           Financial Group, Ltd., Suntrust Bank, and
           the Registrant.                                         35

 27        Financial Data Schedule                                 41

------------------------------------------------------------------
*Incorporated  by  reference  to  the  statement  or  report
indicated.

     The   Registrant   will  provide  any   Shareholder  or
participant in the Company Stock Fund in the 401(k) Programs
copies of any of the foregoing exhibits upon written request
addressed to Corporate  Secretary,  Cone Mills  Corporation,
3101 North Elm Street, Greensboro, NC 27408.

                                       33
<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.

                                          CONE MILLS CORPORATION
                                          (Registrant)





Date:   November 14, 2000                 /s/ Gary L. Smith
                                          Gary L. Smith
                                          Executive Vice President and
                                          Chief Financial Officer

                                        34
<PAGE>