DONATION AGREEMENT

     Donation Agreement dated as of the 10th day of October, 1997
(the   "Donation   Agreement"),  by  and   between   the   CASINO
REINVESTMENT  DEVELOPMENT AUTHORITY (the "Authority"),  a  public
body  established in, but not of, the Department of the  Treasury
of  the  State  of  New  Jersey, and MAC,  Corp.,  a  New  Jersey
corporation  with  an  address  at  19  South  Tennessee  Avenue,
Atlantic City, New Jersey ("Mirage NJ").

      WHEREAS,  the  Authority was requested to  provide  partial
funding  to  assist  in  the design and construction  of  traffic
infrastructure  improvements  for the  Atlantic  City  area  (the
"Project"); and

     WHEREAS, pursuant to 5:12-160 of the Casino Control Act (the
"Act"),  the  purposes of the Authority are, among other  things,
(i)  to  maintain public confidence in the casino gaming industry
as  a  unique tool of urban redevelopment for Atlantic City, (ii)
to  provide  a  method of encouraging new capital  investment  in
Atlantic  City,  (iii) to provide, further  and  promote  tourist
industries  in  New Jersey by providing financial assistance  for
the   planning,  acquisition,  construction  and   operation   of
facilities  for the recreation and entertainment of  the  public,
(iv)   to  assist  in  the  financing  of  the  construction   of
infrastructure  projects, including roads and  highways,  (v)  to
cooperate  with and assist local governmental units in  financing
eligible  projects,  and (vi) to perform any combination  of  the
following; and

      WHEREAS, pursuant to 5:12-161g of the Act, the Authority is
empowered to enter into any agreements or contracts, execute  any
instruments,  and  do and perform any acts or  things  necessary,
convenient,  or  desirable  for the purposes  of  the  Authority,
including the entering into of agreements or contracts  with  any
governmental unit to provide for the payment of principal of  and
interest on any obligation issued by that governmental unit,  the
maintenance  of  necessary  reserves  in  connection  with  these
obligations  or  the  payments under any lease  entered  into  in
connection with any eligible project; and

      WHEREAS, pursuant to 5:12-161o of the Act, the Authority is
empowered  to  enter  into all agreements or contracts  with  any
governmental unit or person, execute any instruments, and do  and
                            
                            Exhibit 10.16
<PAGE>

perform  any  acts or things necessary, convenient, or  desirable
for  the  purposes  of  the Authority  to  carry  out  any  power
expressly given in the Act; and

      WHEREAS,  the  Project is in furtherance  of  an  agreement
executed  on  January  10,  1997, as amended  ("Road  Development
Agreement") between the State of New Jersey (the "State"),  South
Jersey  Transportation  Authority ("SJTA")  and  Mirage  Resorts,
Incorporated  ("Mirage") and thereafter, assigned  by  Mirage  to
Atlandia  Design and Furnishings, Inc., a wholly owned subsidiary
of Mirage ("Atlandia"); and

      WHEREAS,  Atlandia  or an affiliate  thereof  will  be  the
developer for the Project and SJTA and/or the State will  accept,
own, maintain and operate the Project upon its completion; and

      WHEREAS, the total cost for the Project is estimated to  be
$330 Million; and

      WHEREAS,  it is anticipated that the State will  contribute
funds  from the Transportation Trust Fund as well as funds to  be
financed through the SJTA;  and

      WHEREAS, SJTA has authorized or will authorize the issuance
of bonds to assist in financing the Project; and

      WHEREAS,  the State requested that partial funding  of  the
Project   costs  be  made  available  on  terms  and   conditions
satisfactory to the Authority, Mirage, SJTA and the State; and

      WHEREAS,  the Authority is requested to fund, or assist  in
funding, $120 Million; and

      WHEREAS,  one part of the Authority funding is to be from a
donation  by  a casino licensee, as to which Mirage  is  or  will
become  a  holding  company  under  N.J.S.A.  5:12-26,  alone  or
together  with other casino licensees (collectively the "Donors")
operating  casino  hotels  on the Marina  Land  as  described  on
Exhibit  A and commonly referred to as the "H-Tract", to be  made
if  and  when they become casino licensees and commence operation
of  a casino on the H-Tract, in the aggregate amount of up to $55
Million  (such aggregate principal sum of the Bonds  at  issuance
being  the  "Donation  Principal Sum")  plus  the  equivalent  of
interest (including capitalized interest) at a rate per annum set
forth herein from the issue date of certain bonds to be issued by
the  SJTA  pursuant to that certain Resolution  of  SJTA  adopted
October  8,  1997, authorizing Road Development  Special  Revenue
Bonds  (the  "Bonds") to the date of repayment of the Bonds  (the
Donation  Principal  Sum together with such  interest  being  the
"Donation")  from  their  respective investment  alternative  tax
obligations, as set forth herein, which will be utilized  to  pay
                               
                               2
<PAGE>

interest  and  retire the Bonds and which are the  subject  of  a
pledge   agreement  between  the  Authority  and  SJTA   ("Pledge
Agreement"); and

      WHEREAS, Mirage desires to advance funds in an amount equal
to  the Donation Principal Sum by buying up to $55 Million of the
Bonds  to  be  issued  by  SJTA pursuant  to  the  Bond  Purchase
Agreement,  dated of even date herewith, between SJTA and  Mirage
(the  "Bond Purchase Agreement") for use in funding the  Project,
and  Mirage NJ desires to enter into this Donation Agreement with
the  Authority, providing, among other things, that if  and  when
Mirage NJ becomes a casino licensee and commences operation of  a
casino on the H-Tract, it shall execute (1) a Securities Purchase
Contract  in  substantially the form of  the  agreement  attached
hereto as Exhibit 1 (the "Securities Purchase Contract"), thereby
obligating  it  to  purchase  bonds  of  the  Authority  or  make
alternative  investments in lieu of purchasing bonds  and  (2)  a
Credit  Agreement  in  substantially the form  of  the  agreement
attached  hereto  as Exhibit 2 (the "Credit Agreement"),  thereby
setting  forth  the  terms of the investment credit  it  will  be
eligible to receive as a casino licensee for its portion  of  the
Donation to the Project; and

      WHEREAS, the Authority made a preliminary determination  of
eligibility of the Project at its meeting of February 18,   1997,
pursuant to Resolution No. 97-35; and

     WHEREAS, a public hearing concerning the Project was held on
March 13, 1997; and

      WHEREAS,  the Authority, at its meeting of April 15,  1997,
pursuant to Resolution No. 97-75, determined the Project to be an
approved  Project, authorized the reservation of  funds  for  the
Project  and  authorized the Executive Director to negotiate  and
enter into a Donation Agreement; and

      WHEREAS, the Authority, at its meeting of August 26,  1997,
pursuant to Resolution No. 97-209,  amended and supplemented  its
Resolutions Nos. 97-75 through 97-78, adopted on April 15,  1997;
and

      WHEREAS,  as  a casino licensee, Mirage NJ  shall  have  an
obligation, pursuant to N.J.S.A. 5:12-144.1a.(2), to pay  to  the
State  Treasurer on or before the 15th day of the first,  fourth,
seventh and tenth months of each year as partial payment  of  the
investment  alternative tax imposed pursuant  to  N.J.S.A.  5:12-
144.1a.(1)  an  amount  equal to 1.25%  of  the  estimated  gross
revenues  for  the three-month period immediately  preceding  the
first  day  of  those  months  (for  purposes  hereinafter,   the
occurrence  of each such date requiring payment to be made  shall
be  deemed the date upon which Mirage NJ incurs an Atlantic  City
Obligation).
                                
                                3
<PAGE>
      
      NOW,  THEREFORE,  for and in consideration  of  the  mutual
covenants and agreements set forth herein, and for other good and
valuable consideration, it is hereby agreed as follows:


                           ARTICLE I
                          DEFINITIONS

     SECTION 1.1.  Definitions.

      (a)  The following shall have the meanings specified in the
foregoing recitals:

          "Authority"
          "Donation Agreement"
          "Donation"
          "Donation Principal Sum"
          "Donors"
          "H-Tract"
          "Mirage"
          "Mirage NJ"
          "Pledge Agreement"
          "Project"
          "Road Development Agreement"
          "SJTA"
          "State"

      (b)   Terms  defined  elsewhere in this Donation  Agreement
shall have the meanings ascribed to such terms in the sections in
which the definitions therefor appear.

      (c)   Terms  not  otherwise defined herein shall  have  the
meanings ascribed to such terms in the Credit Agreement:


                           ARTICLE II
          REPRESENTATIONS AND WARRANTIES OF MIRAGE NJ

      SECTION  2.1.  Representations and Warranties.   Mirage  NJ
represents, warrants and agrees that:

      (a)   It  (i) is a corporation duly organized and   validly
existing under the laws of the State of New Jersey, (ii) has  the
corporate  power  and authority to carry on its business  as  now
being conducted, and (iii) has the corporate power to execute and
deliver  this  Donation Agreement and to perform its  obligations
hereunder.
                                
                                4
<PAGE>
      
      (b)   The execution and delivery of this Donation Agreement
has  been duly authorized and this Donation Agreement constitutes
the  valid  and  binding obligation of Mirage NJ  enforceable  in
accordance with its respective terms, subject only to bankruptcy,
insolvency, moratorium, reorganization or other similar  laws  or
to  equitable principles relating to or affecting the enforcement
of creditors' rights generally.

      (c)   Except  as noted on the litigation schedule  attached
hereto  as  Exhibit 3, there is no action, suit or proceeding  at
law  or in equity or by any governmental instrumentality or other
agency  now pending or, to the knowledge of Mirage NJ, threatened
against  or  affecting  Mirage NJ that, if adversely  determined,
would   materially  impair  its  right  to  carry   on   business
substantially  as now conducted and as now contemplated  by  this
Donation  Agreement  or  to perform its  obligations  under  this
Donation  Agreement  or  would materially  adversely  affect  its
financial condition.

      (d)  It is not in default in the performance, observance or
fulfillment  of any of the obligations, covenants  or  conditions
contained in any agreement or instrument to which it is a  party,
which  default would materially impair its right to carry on  its
business  substantially as now conducted and as now  contemplated
by  this  Donation Agreement or to perform its obligations  under
this Donation Agreement or would materially adversely affect  its
financial  condition and the execution of this Donation Agreement
and performance hereunder will not result in the violation of any
agreement or instrument to which Mirage NJ is a party.

      (e)   No  representation or warranty made  by  it  in  this
Donation Agreement contains any material misstatement of fact.


                          ARTICLE III
        REPRESENTATIONS AND WARRANTIES OF THE AUTHORITY

     SECTION 3.1.  Representations and Warranties.  The Authority
represents, warrants and agrees that:

     (a)  It (i) is a public body established in, but not of, the
Department of Treasury of the State and an instrumentality of the
State  established  under the Act, and (ii)  has  the  power  and
authority  to execute and deliver this Agreement and  to  perform
its obligations hereunder.

      (b)   The execution and delivery of this Donation Agreement
has  been duly authorized and this Donation Agreement constitutes
the valid and binding obligations of the Authority enforceable in
accordance   with   its  terms,  subject  only   to   bankruptcy,
insolvency, moratorium, reorganization or other similar  laws  or
to  equitable principles relating to or affecting the enforcement
of creditors' rights generally.
                                
                                5
<PAGE>
      
      (c)   Except  as noted on the litigation schedule  attached
hereto  as  Exhibit 3, there is no action, suit or proceeding  at
law  or in equity or by any governmental instrumentality or other
agency  now  pending  or,  to  the knowledge  of  the  Authority,
threatened against or affecting the Authority that, if  adversely
determined,  would materially impair its ability to  perform  its
obligations under this Donation Agreement.

      (d)   It  is  not  in material default in the  performance,
observance or fulfillment of any of the obligations, covenants or
conditions contained in any agreement or instrument to  which  it
is  a  party  and  the execution of this Donation  Agreement  and
performance  hereunder will not result in the  violation  of  any
agreement or instrument to which the Authority is a party.

      (e)   No  representation or warranty made  by  it  in  this
Donation Agreement contains any material misstatement of fact.


                           ARTICLE IV
             PURCHASE OF SJTA SPECIAL REVENUE BONDS

      SECTION  4.1.   Pursuant  to the Bond  Purchase  Agreement,
Mirage has agreed to purchase Bonds in a principal amount  up  to
the  sum  of  Fifty-Five Million ($55,000,000.00)  Dollars.   The
Bonds  shall bear interest calculated pursuant to the  provisions
of  the SJTA bond documents related thereto, which rate shall  be
as set forth in Section 4.2 hereof.

     SECTION 4.2.   If the Bonds bear interest at a taxable rate,
such interest rate shall be 66 2/3 of the average rate of Moody's
A-rated Utility Index for bonds available for purchase during the
26  weeks preceding the date of issuance of such Bonds.   If  the
Bonds  bear  interest at a tax exempt rate,  such  interest  rate
shall  be 66 2/3 of the average rate of the Bond Buyer Weekly  25
Bond  Index for bonds available for purchase during the  last  26
weeks  preceding  the  date of issuance of such  Special  Revenue
Bonds.


                           ARTICLE V
         EXECUTION OF SECURITIES PURCHASE AGREEMENT AND
             CREDIT AGREEMENT AND DONATION OF FUNDS

      SECTION 5.1.   If, and only if, Mirage NJ becomes a  casino
licensee  as defined in the Casino Control Act (N.J.S.A.  5:12-1,
et  seq.)  and  commences operation of a casino on  the  H-Tract,
then,  within  fifteen (15) days after the commencement  of  such
operations,  Mirage  NJ  and  the  Authority  shall  execute  the
Securities  Purchase Contract and the Credit Agreement.   Subject
                                
                                6
<PAGE>

to  the  transfer  provisions of Article  VI  hereof,  upon  such
execution,  Mirage  NJ hereby agrees to make a  donation  to  the
Project  of  its  Atlantic City Obligations,  as  and  when  such
obligations  are  incurred and paid in accordance  with  N.J.S.A.
5:12-144.1a.(2),  in  an  amount equal  to  its  portion  of  the
Donation  and the Authority hereby agrees to accept such donation
and  treat  it as such for purposes of Section 404(F)(2)  of  the
Securities Purchase Contract.

      SECTION  5.2.    The  Authority  shall  not  be  under  any
obligation to repay, reimburse or otherwise compensate Mirage NJ,
Mirage  or, except as expressly stated in Article VI hereof,  any
holders of the Bonds for any payment of principal and interest or
any  costs  incurred by them in connection with the  purchase  or
acquisition  of  the  Bonds other than  through  credits  applied
against  the Atlantic City Obligations of Mirage NJ in accordance
with  and  subject to the terms and conditions  of  the  executed
Credit  Agreement. In furtherance of the Credit Agreement and  as
provided  in that certain Pledge Agreement between the  Authority
and  SJTA  dated  of  even  date herewith,  the  Authority  shall
immediately  transfer to SJTA, upon its receipt of  any  donation
from  Mirage  NJ under this Donation Agreement (and any  donation
from  any  other Donor pursuant to a donation agreement  executed
pursuant to Section 6.2(ii)), 100% of such donation.


                           ARTICLE VI
               TRANSFERS OF SPECIAL REVENUE BONDS
                    AND DONATION OBLIGATIONS

      SECTION  6.1.   In the event Mirage NJ or Mirage  sells  or
otherwise  transfers  any of the Bonds  to  one  or  more  Casino
Licensee Bondholders, the donation to be made by Mirage NJ  under
this Donation Agreement shall be reduced such that its portion of
the  Donation shall be an amount equal to the Donation  less  the
amount of investment alternative tax obligation payments received
by  the  Authority from Casino Licensee Bondholders for donations
for  principal and interest payments on the Bonds  made  by  such
Casino Licensee Bondholders pursuant to and consistent with their
respective donation agreements (said donations for principal  and
interest  payments  on  the  Bonds in  an  amount  equal  to  the
principal amount of the Bonds purchased or acquired by the Casino
Licensee  Bondholder  from Mirage or any  other  Casino  Licensee
Bondholder,  together with unpaid, accrued  interest  and  future
interest   on   the  transferred  bonds  being  the  "Transferred
Donation").  A sale or transfer of bonds to any person or entity,
shall  not reduce the amount of the donation obligation of Mirage
NJ  pursuant  to  Section 5.1, except, and to  the  extent,  such
transfer is to a Casino Licensee Bondholder which (i) executes  a
Donation  Agreement  committing  to  make  a  donation   of   its
investment   alternative  tax  obligations,  (ii)   incurs   such
obligations,  and  (iii)  makes  payments  to  the  Authority  in
satisfaction thereof.
                               
                               7
<PAGE>
      
      SECTION  6.2.  For purposes of this Donation  Agreement,  a
Casino  Licensee  Bondholder shall  mean  a  casino  licensee  or
prospective casino licensee (other than Mirage NJ) whose  casino,
as defined in the Casino Control Act, is located or to be located
on  the  H-Tract, which: (i) becomes the holder  of  Bonds  as  a
result  of the sale or transfer to it of such Bonds by Mirage  NJ
or  Mirage or any other Casino Licensee Bondholder; (ii) executes
an appropriate donation agreement with the Authority analogous to
this  Donation Agreement, pursuant to which it agrees  that  upon
becoming  a casino licensee and commencing operation of a  casino
on  the  H-Tract,  it  shall  execute an  appropriate  securities
purchase contract and a credit agreement, analogous to Exhibits 1
and  2,  respectively,  and commits to make  a  donation  of  its
"Atlantic  City Obligations" to satisfy the Transferred Donation,
which  Atlantic  City  Obligations  shall  be  utilized   to  pay
interest and/or to retire the Bonds; and (iii) agrees to  pay  to
the Authority its administrative costs and all out-of-pocket fees
and  expenses  in connection with the subject sale  or  transfer.
The  Authority shall execute the agreements referenced in Section
6.2(ii)  upon  execution of such agreements by a Casino  Licensee
Bondholder.  A sale or transfer by the Casino Licensee Bondholder
of  the Bonds it has purchased or acquired to any other person or
entity shall not reduce the amount of the donation obligation  of
the Casino Licensee Bondholder pursuant to this Section 6.2.

      SECTION  6.3.    The  Authority  shall  not  be  under  any
obligation to repay, reimburse or otherwise compensate  a  Casino
Licensee  Bondholder or other bondholders for any costs  incurred
by  them in connection with the purchase of the Bonds other  than
through  credits against the Atlantic City Obligations of  Mirage
NJ  or Casino Licensee Bondholders in accordance with and subject
to  the terms and conditions of the credit agreements executed by
Casino   Licensee  Bondholders.  In  furtherance  of  the  Credit
Agreement,  and  as  provided in that  certain  Pledge  Agreement
between  the Authority and SJTA dated of even date herewith,  the
Authority   shall  immediately  transfer  to   SJTA,   upon   the
Authority's  receipt of the donations from the  Donors,  100%  of
such  donations  for  payment to the  holders  of  the  Bonds  in
accordance  with  this  Donation Agreement,  donation  agreements
executed   by  Casino  Licensee  Bondholders,  and   the   Pledge
Agreement.

      SECTION  6.4.   For purposes of subsections  6.2  and  6.3,
Atlantic City Obligations shall mean, as calculated at any  time,
and  from  time-to-time,  that  portion  of  the  subject  Casino
Licensee  Bondholder's Annual Investment Tax Credit  (as  defined
herein)  attributable to a future Quarterly  Payment  Date  which
constitutes funds available for projects in the City of  Atlantic
City  which  are  not Housing Projects.  "Annual  Investment  Tax
Credit" shall mean, with respect to each calendar year commencing
                                
                                8 
<PAGE>

with  the  calendar  year  in which the  subject  Casino  License
Bondholder becomes a casino licensee, an amount equal to one-half
of  said  Casino  Licensee Bondholder's Tax Obligation,  or  such
other  percentage as may be required by any amendment to N.J.S.A.
5:12-144.1.


                          ARTICLE VII
                         MISCELLANEOUS

     SECTION 7.1.  Notices.  All notices and other communications
hereunder  shall be in writing and shall be hand  delivered  with
receipt   acknowledged,  sent  by  telecopy,  telegraph,   telex,
facsimile  transmission or any other similar means of  electronic
communication,  mailed  by  first  class  mail,   registered   or
certified,  return  receipt  requested,  or  sent  by  recognized
overnight  carrier,  postage prepaid and with acknowledgement  of
delivery,  to the parties at the addresses or numbers  set  forth
below or as to each party at such other or additional address  or
numbers as shall be designated by such party in a written  notice
to the other party thereto:

          1.   to the Authority at the following address:

                 1014 Atlantic Avenue
                 P.O. Box 749
                 Atlantic City, New Jersey  08401
                 Attn:  Executive Director
                 Facsimile:  609-347-9049

          2.   to Mirage NJ at the following address:
          
                c/o Mirage Resorts, Incorporated
                3400 Las Vegas Boulevard South
                Las Vegas, Nevada 89109
                Attn: Bruce A. Levin, Esq.
                      Vice President & General Counsel
                Facsimile:  702-791-5787

                Notice  shall  be deemed given when received.  The  
Authority  or Mirage  NJ may, by notice given hereunder, designate 
any  further or  different addresses to which subsequent notices, 
certificates or  other  communication shall be sent.  Notices may 
be given  on behalf of a party by its attorney.

      SECTION  7.2.  Severability.  If one or more provisions  of
this  Donation Agreement, or the application of any provision  of
this  Donation  Agreement to any set of circumstances,  shall  be
determined  to  be  invalid or ineffective for any  reason,  such
determination shall not affect the validity or enforceability  of
the remaining provisions or the application of said provision  or
any remaining provisions to a set of different circumstances.
                                
                                9
<PAGE>
      
      SECTION 7.3.  Governing Law.  This Donation Agreement shall
be  governed  by and construed as a contract negotiated,  entered
into  and  performed in, and in accordance with the laws  of  the
State of New Jersey without regard to principles of conflicts  of
law.    Each   party  irrevocably  consents  to   the   exclusive
jurisdiction  of the Superior Court of the State  of  New  Jersey
venued  in Atlantic County in any and all actions and proceedings
under  this Donation Agreement.  Any service of process and other
notice  in  any action, suit or proceeding shall be effective  in
the manner set forth in Section 7.1 above.

      SECTION  7.4.   Execution of Counterparts.   This  Donation
Agreement may be simultaneously executed in several counterparts,
by  manual  or  facsimile signatures, each of which  counterparts
shall  be an original and all of which shall constitute  but  one
and the same instrument.

      SECTION 7.5.  Amendments.  This Donation Agreement  may  be
amended  only with the concurrent written consents of the parties
hereto.  In the event that the Act is amended, the Authority  and
Mirage  NJ hereby agree to amend this Donation Agreement provided
such  amendment  does not reduce or increase the  obligations  of
either party and is made to be consistent with the Act.

       SECTION  7.6.   Nature  of  Relationship.   This  Donation
Agreement   constitutes  a  contractual  agreement  between   the
Authority   and  Mirage NJ and is not intended nor  shall  it  be
construed  so  as  to  create any form of  a  partnership,  joint
venture  or other business relationship as between the  Authority
and Mirage NJ.

     SECTION 7.7.  Assignment.  The interest of any party in this
Donation Agreement may not be assigned by any such party  without
the  prior written consent of all other parties to this  Donation
Agreement.

      SECTION  7.8.   Additional Documents.  The  parties  hereto
agree  to  execute  such additional documents and  to  take  such
additional  actions as are necessary to effectuate the  terms  of
this Donation Agreement.

      SECTION 7.9.  Construction of Certain Terms.  Wherever  the
term  "Authority" shall be used in this Donation  Agreement,  the
term  shall  include  the  Authority's successors  and  permitted
assigns.

      SECTION  7.10.   Fees  and Expenses.   Except  as  provided
otherwise  in  Section  6.2 hereof, each party  hereto  shall  be
responsible for its own fees and expenses in connection with  the
negotiations and consummation of the transactions contemplated by
this  Agreement, including the transactions contemplated  by  the
                              
                              10
<PAGE>

Bond  Purchase Agreement.  Nothing contained in this Section 7.10
shall  limit  the rights of either party to receive reimbursement
of  its  fees  and  expenses  as may  be  provided  in  the  Road
Development Agreement.
      
      IN  WITNESS  WHEREOF, the parties hereto have  caused  this
Donation Agreement to be executed by its duly authorized officers
and attested as of the date first above written.

ATTEST:                            CASINO REINVESTMENT DEVELOPMENT
                                   AUTHORITY


/s/ [Illegible]                    BY:/s/ James B. Kennedy
                                      --------------------------- 
                                       JAMES B. KENNEDY
                                       Executive Director


ATTEST:                            MAC, CORP.


/s/ Tanya M. Taylor                BY:/s/ Bruce A. Levin
                                      --------------------------- 
                                       BRUCE A. LEVIN
                                       Assistant Secretary
                                        
                                11