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 AND EXCHANGE ACT OF 1934

                For the Quarter Ended February 4, 1996

                                 OR

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


                       Commission File No. 1-5400


                            FARAH INCORPORATED
         (Exact name of registrant as specified in its charter)

               Texas                                 74-1061146
  (State or other jurisdiction of                 (I.R.S. Employer
  incorporation or organization)                  Identification No.)


  8889 Gateway West, El Paso, Texas                    79925
  (Address of principal executive offices)           (Zip Code)



     Registrant's telephone number, including area code   (915) 593-4444




     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 and 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 .

         As of March 5, 1996 there  were  outstanding  10,162,936  shares of the
registrant's  common stock,  no par value,  which is the only class of common or
voting stock of the registrant.




<PAGE>
<TABLE>

PART 1.  FINANCIAL INFORMATION

Item 1.  Financial Statements

                   FARAH INCORPORATED AND SUBSIDIARIES
  CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
          QUARTERS ENDED FEBRUARY 4, 1996 AND FEBRUARY 3, 1995
-------------------------------------------------------------------------------
                                (Unaudited)

                                                    (Thousands of dollars
                                                    except per share data)
                                                February 4,       February 3,
                                                    1996              1995
                                               --------------    --------------

<S>                                              <C>               <C> 
Net sales                                        $    51,510           49,949
Cost of sales                                         37,713           37,138
                                               --------------    --------------

    Gross profit                                      13,797           12,811

Selling, general and administrative expenses          13,789           14,434
                                               --------------    --------------

     Operating income (loss)                               8           (1,623)
                                               --------------    --------------

Other income (expense):
     Interest expense                                 (1,365)            (691)
     Interest income                                     236              197
     Foreign currency transaction gains                   67              175
     Other, net                                          210               14
                                               --------------    --------------
                                                        (852)            (305)

     Loss before provision (benefit)
            for income taxes                            (844)          (1,928)

     Provision (benefit) for income taxes                145             (673)
                                               --------------    --------------

     Net loss                                           (989)          (1,255)
                                                                              
Retained earnings:
     Beginning                                         1,560           14,501
                                               --------------    --------------

     Ending                                      $       571           13,246
                                               ==============    ==============

Net loss per share                               $     (0.10)           (0.12)
                                               ==============    ==============

Weighted average shares of common stock
   outstanding                                    10,149,070       10,096,111
                                               ==============    ==============

</TABLE>

<PAGE>

<TABLE>
                       FARAH INCORPORATED AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                      FEBRUARY 4, 1996 AND FEBRUARY 3, 1995
-------------------------------------------------------------------------------
                                  (Unaudited)
                                  
                                                    (Thousands of dollars)
                                                 February 4,        November 3,
                                                     1996               1995
                                              --------------     --------------
<S>                                           <C>                      <C>
ASSETS
Current assets:
  Cash                                        $       4,221              3,657
  Trade Receivables, net                             30,057             39,824
   Inventories:
        Raw materials                                11,366             13,391
        Work in process                              12,185             14,429
        Finished goods                               44,080             44,943
                                              --------------     --------------
                Total inventories                    67,631             72,763
   Other current assets                              11,811             11,667
                                              --------------     --------------
                Total current assets                113,720            127,911

Note receivable                                       5,518              5,600
Property, plant and equipment, net                   33,113             33,363
Other non-current assets                              7,034              6,953
                                              --------------     --------------
                                              $     159,385            173,827
                                              =============      ==============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
   Short-term debt                            $      38,252             44,779
   Current installments of long-term debt             2,277              2,407
   Trade payables                                    14,911             17,644
   Other current liabilities                         10,761             14,073
                                              --------------     --------------
                 Total current liabilities           66,201             78,903

Long-term debt, excluding current 
 installments                                        12,606             12,568
Other non-current liabilities                         3,159              3,136

Deferred gain on sale of building                     4,742              5,250
                                                                         
Shareholders' equity:
   Common stock, no par value,
     $.01 stated value, 20,000,000 
     shares authorized; issued 10,191,843
     in 1996 and 10,181,601 in 1995                  46,024             46,024
   Additional paid-in capital                        29,644             29,425
   Cumulative foreign currency
     translation adjustment                          (1,818)            (1,295)
   Minimum pension liability adjustment              (1,635)            (1,635)
   Retained earnings                                    571              1,560
                                              --------------     --------------
                                                     72,786             74,079

   Less: Treasury stock, 36,275 shares in
    1996 and 1995, at cost                              109                109
                                              --------------     --------------
           Total shareholders' equity                72,677             73,970
                                              --------------     --------------
                                              $     159,385            173,827
                                              ==============     ==============

</TABLE>

<PAGE>
<TABLE>
                    FARAH INCORPORATED AND SUBSIDIARIES
              CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
            QUARTERS ENDED FEBRUARY 4, 1996 AND FEBRUARY 3, 1995
-------------------------------------------------------------------------------
                               (Unaudited)
                                                    (Thousands of dollars)
                                                   1996               1995
                                             ----------------    --------------
<S>                                          <C>                      <C>
Cash flows from (used in)
 operating activities:
     Net loss                                $         (989)           (1,255)
                                                                
     Adjustments to reconcile net
      loss to net cash from (used in)
      operating activities:
            Depreciation and amortization             1,325               881
            Amortization of deferred gain on          
              building sale                            (508)             (508)
     Decrease (increase) in:
                 Trade receivables                    9,767             9,718
                 Inventories                          5,132            (4,438)
                 Other current assets                  (144)           (3,293)
     Increase (decrease) in:
                 Trade payables                      (2,733)           (4,983)
                 Other current liabilities           (3,093)           (5,169)
                                             ----------------    --------------

                   Net cash from (used
                   in)operating activities            8,757            (9,047)
                                             ----------------    --------------

Cash flows used in investing activities:
     Purchases of property, plant
       and equipment                                   (667)           (3,509)
                                             ----------------    --------------

                   Net cash used in 
                    investing activities               (667)           (3,509)
                                             ----------------    --------------

Cash flows from (used in)
  financing activities:
     Net increase (decrease)
       in short-term debt                            (6,527)           10,065
     Proceeds from issuance 
       of long-term debt                                  3             3,692
     Repayment of long-term debt                       (603)             (517)
     Proceeds from sale of common stock                   -                86
     Other                                              124                66
                                             ----------------    --------------

                  Net cash from (used in) 
                   financing activities              (7,003)           13,392
                                             ----------------    --------------

Foreign currency translation adjustment                (523)             (280)
                                             ----------------    --------------

Net increase in cash                                    564               556
                                                           
Cash, beginning of quarter                            3,657             2,372
                                             ----------------    --------------

Cash, end of quarter                         $        4,221             2,928
                                             ================    ==============

Supplemental cash flow disclosures:
     Interest paid                           $        1,419               651
     Income taxes paid                                  299             1,425
     Assets acquired through direct 
        financing loans or capital leases               508               976

</TABLE>

<PAGE>
                       FARAH INCORPORATED AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.       The attached  condensed  consolidated  financial  statements  have been
         prepared  pursuant to the rules and  regulations  of the Securities and
         Exchange  Commission.  As a result,  certain  information  and footnote
         disclosures  normally  included  in  financial  statements  prepared in
         accordance  with generally  accepted  accounting  principles  have been
         condensed or omitted.  The Company  believes that the disclosures  made
         are adequate to make the information  presented not  misleading.  These
         condensed   consolidated   financial   statements  should  be  read  in
         conjunction  with the  consolidated  financial  statements  and related
         notes included in the Company's 1995 Annual Report on Form 10-K.

2.       The foregoing  financial  information  reflects all adjustments  (which
         consist only of normal recurring adjustments) which are, in the opinion
         of  management,  necessary to present a fair statement of the financial
         position and the results of  operations  and cash flows for the interim
         periods.

3.       The  Company  maintains  its fiscal  year on a 52/53 week  fiscal  year
         basis.  Effective in the first quarter of 1996, the Company revised its
         fiscal  month-end from Friday to the following  Sunday.  The change was
         implemented to conform the Company's accounting period to the month-end
         shipping  pattern  required by customers  and to minimize  overtime and
         transportation  costs.  The effect of the change was an increase in net
         sales of approximately  $2,383,000 and was not material to gross profit
         for the first quarter of 1996.


<PAGE>


                       FARAH INCORPORATED AND SUBSIDIARIES


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

Results of Operations

         The following sets forth,  certain financial data as percentages of net
sales:
<TABLE>
                                                               First Quarter Ended
                                                        ---------------------------------
                                                            1996                1995
                                                        --------------      -------------
<S>                                                            <C>                 <C>                    
                 Net sales:
                      Farah U.S.A.                              72.6%               72.7%
                      Farah International                        19.4               18.7
                      Value Slacks                                8.0                8.6
                                                        --------------      -------------
                 Total net sales                                100.0              100.0
                 Cost of sales                                   73.2               74.4
                                                        --------------      -------------
                      Gross profit                               26.8               25.6
                 Selling, general and
                   administrative expenses                       26.8               28.9
                                                        --------------      -------------
                      Operating income (loss)                     0.0               -3.3
                 Other expense, net                               1.6                0.6
                                                        --------------      -------------
                      Loss before income taxes                   -1.6               -3.9
                  Income tax expense (benefit)                    0.3               -1.4
                                                        --------------      -------------
                       Net loss                                 -1.9%              -2.5%
                                                        ==============      =============
</TABLE>
                                                
         Consolidated  sales for the first  quarter of fiscal 1996  increased by
$1,561,000  (3.1%) compared to the first quarter of fiscal 1995. Sales increased
at Farah U.S.A.  and Farah  International by 3% and 7%,  respectively,  and were
down at Value Slacks by 4%.

         Farah  U.S.A.   sales  for  the  first  quarter  of  fiscal  1996  were
$37,386,000  compared to  $36,334,000  in the first quarter of 1995.  Unit sales
increased 5% while the average unit selling  price  decreased 2%.  Overall,  the
retail  market in the U.S.  remained  soft in the first  quarter with  continued
competitive and promotional  pressures having a negative impact on first quarter
sales.  The  reduction  in the average  unit  selling  price was also due to the
change in product  mix,  with the Company  selling  fewer coats and more private
label  product  this year  compared  to last year.  Sales of  Savane(R)  product
increased 31% in the first quarter of 1996 compared to 1995.  The sales increase
was due to the introduction of the Savane(R) Soft Wash(TM)  labeled product,  an
increase  in sales of  seasonal  product  and the  introduction  of Savane  suit
separates.  Offsetting  the Savane  increase were  decreases in Farah(R),  Farah
Clothing Co.(R) and John Henry(R) sales as certain customers re-positioned their
business  in these  brands to other  labels.  Sales of  private  label  products
increased  by 18% as a result of the addition of several new  customers  and new
programs with existing customers compared to 1995.

         Farah  International sales in the first quarter of 1996 were $9,982,000
compared to $9,320,000 in the first  quarter of 1995.  Unit volume  increased 9%
while  the  average  unit  selling  price  decreased  2%.  Sales at  Farah  U.K.
represented 63% of international  sales and increased 6% for the quarter.  Sales
at Farah Australia and New Zealand, which represented 35% of total international
sales, increased 14% in the first quarter of 1996 compared to 1995. Increases in
international  sales  were  mainly  attributable  to  higher  sales of Savane no
wrinkle product and increased private label business.

         Value  Slacks  sales  in the  first  quarter  of 1996  were  $4,142,000
compared to $4,295,000  in the first quarter of 1995, a 4% decrease.  At the end
of the first  quarter of 1996 the Company was  operating 38 retail stores in the
U. S. At the end of the first quarter of 1995 the Company had 29 U.S. stores and
5 Puerto  Rican  stores.  All Puerto  Rican stores were closed by the end of the
fourth  quarter of 1995 and  additional  stores were  opened in the U.S.  during
1995.  Overall store sales  decreased due to the soft retail market  nation-wide
and, more  specifically,  in the U.S./Mexico border area due to the Mexican peso
devaluation. Sales were also down in stores located in the Eastern United States
as a result of severe weather conditions experienced during the period.

     As a percent of sales,  gross profit was 26.8% in the first quarter of 1996
and 25.6% in the first quarter of 1995.

         Farah  U.S.A.  gross  profit as a percent of sales was 22% in the first
quarter of 1996  compared  to 20% in the same period of 1995.  The higher  gross
profit percent was  attributable  to increased  sales of Savane  product,  which
generally  carry  higher  profit  margins,  combined  with  overall  lower costs
resulting from the  reconfiguration  of the Company's cost structure which began
in 1995 and  continued  through  the  first  quarter  of 1996.  Costs  were also
favorably  impacted by the devaluation of the Mexican peso. The average exchange
rate of the Mexican peso  devalued by more than 85% in the first quarter of 1996
compared to the same period a year ago.  Partially  offsetting the reductions in
costs were employee  severance  expenses  recorded in the first quarter of 1996.
The increase in the gross profit margin was also  partially  offset by increased
sales of private label product which generally carry lower gross profit margins.

         Farah  International  gross profit as a percent of sales decreased from
35% in the first  quarter of 1995 to 34% in the first  quarter  of 1996.  Higher
sales of private  label  product,  which  carry  lower  margins,  combined  with
manufacturing inefficiencies in the Irish factories reduced this percentage.

         Value Slacks gross profit as a percent of sales  decreased  from 53% in
the first quarter of 1995 to 50% in the first quarter of 1996. Promotional sales
were higher in the first quarter of 1996 as a result of decreased  market demand
at retail during the 1995 holiday season.

         Selling,  general and administrative  expenses ("SG&A") as a percent of
sales was  26.8% in the  first  quarter  of 1996,  down from  28.9% in the first
quarter  of  1995.  SG&A was down 3% at Farah  U.S.A.,  offset  partially  by an
increase of 1% at Farah  International and an increase of 3% at Value Slacks. At
Farah  U.S.A.,  the  decrease  in SG&A was  attributable  to a 32%  decrease  in
advertising  expense,  combined  with  the  effect  of  lower  overall  expenses
resulting  from company  wide cost  reduction  efforts.  The increase in SG&A at
Farah International resulted from higher sales in retail concessions which carry
higher expenses.  At Value Slacks the increase resulted from higher  advertising
in an effort to stimulate sales during a competitive retail season.

         Other expense was $547,000 higher in the first quarter of 1996 compared
to the first quarter of 1995. The increase was mainly  attributable to increased
net interest expense on higher debt levels.  Partially  offsetting this increase
was  higher  royalty  income  from the  Company's  Savane  and  Process  2000(R)
licensing agreements.

         Income tax expense was recorded in the first  quarter of 1996  compared
to an income tax benefit in the first quarter of 1995.   The Company's effective
tax rate varies with the mix of income or loss in countries in which the Company
conducts its business.  In  addition, in the first quarter of 1995  deferred tax
benefits  were  recognized  associated  with  net operating loss  carryforwards,
while no such tax benefits were recognized in the first quarter of 1996.

Financial Condition

         The Company's  primary Credit  Agreement  provides up to $50,000,000 of
credit through July 1, 1997, for the Company's  United States and United Kingdom
operations for either  borrowings or letters of credit.  Availability  under the
Credit  Agreement is limited by formulas  derived from accounts  receivable  and
inventory. As of February 4, 1996, usage under the agreement was $38,647,000 and
the excess  credit line  available  was  $8,035,000.  As of February 4, 1996 the
Company was in compliance with all covenants under the Credit Agreement.

         The Company also maintains a capital lease which  originated in 1995 to
acquire laundry,  finishing,  sewing and cutting equipment in Mexico, Costa Rica
and the United  States.  As of February  4, 1996,  the  outstanding  balance was
$7,494,000. The lease contains certain financial covenants and as of February 4,
1996, the Company was in compliance with all such covenants.

         Net cash from  operations in the first quarter of 1996 was  $8,538,000,
primarily  as a result of a decrease in  accounts  receivable  and  inventories.
Production  levels were  decreased in the first  quarter in an attempt to better
match inventory levels with current demand. The decrease in accounts  receivable
was  consistent  with the normal  seasonality  of the  Company's  business.  The
decrease in inventory levels and higher collections on accounts  receivable also
resulted  in a decrease  of  short-term  borrowings  for the  quarter.  Somewhat
offsetting the cash generated from the receivables and inventory  decrease was a
reduction in trade payables and accrued expenses. These reductions were a result
of lower raw  materials  inventory  purchases  and  seasonal  payment of accrued
expenses.

         Capital expenditures through February 4, 1996 approximated  $1,175,000.
Expenditures were mainly for manufacturing equipment and information systems. As
of February 4, 1996, the Company had commitments for future capital expenditures
of approximately $140,000.



<PAGE>


                           PART II. OTHER INFORMATION

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

             Exhibit 11                     Statement regarding computation of
                                            net loss per share.

             Exhibit 27                     Financial Data Schedule

      (b)  Reports on Form 8-K.

             No reports on Form 8-K have been filed during the quarter for which
the report is filed.



                                   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.

                                       FARAH INCORPORATED




Date:        March 6, 1996             /s/ Richard C. Allender
                                       Richard C. Allender
                                       Chairman, Principal Executive Officer

                                       /s/ Russell G. Gibson
                                       Russell G. Gibson
                                       Principal Accounting Officer







<PAGE>

<TABLE>
                        FARAH INCORPORATED AND SUBSIDIARIES

                           FORM 10-Q INDEX TO EXHIBITS

                                FEBRUARY 4, 1996


                                                                        Page
                               Description                             Number
<S>                      <C>                                             <C> 
Exhibit 11               Statement regarding computation of
                         net loss per share.                             11

Exhibit 27               Financial Data Schedule                         12

</TABLE>