Conformed Copy
                                      
                                      
                                  FORM 10-Q
                     SECURITIES AND EXCHANGE COMMISSION
                           Washington, D.C. 20549
                                      
              Quarterly Report Pursuant to Section 13 or 15(d)
                                      
                   of the Securities Exchange Act of 1934
                                      
For Quarter Ended December 5, 1998          Commission File Number 1-4141

                 THE GREAT ATLANTIC & PACIFIC TEA COMPANY, INC.
                 ----------------------------------------------
                                      
             (Exact name of registrant as specified in charter)
       Maryland                                         13-1890974
       --------                                         ----------
(State or other jurisdiction of                     (I.R.S. Employer
incorporation or organization)                      Identification No.)


2 Paragon Drive, Montvale, New Jersey                      07645
-------------------------------------                      -----
(Address of principal executive offices)                 (Zip Code)


Registrant's telephone number, including area code     201-573-9700
                                                       ------------

----------------------------------------------------------------------------


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  XXX           NO
                                        ---------         ---------

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

            Class                   Outstanding at December 5, 1998
            -----                   --------------------------------

Common stock - $1 par value                 38,286,716 shares
               THE GREAT ATLANTIC & PACIFIC TEA COMPANY, INC.
                                      
                       PART I.  FINANCIAL INFORMATION
                                      
ITEM 1.  FINANCIAL STATEMENTS

          STATEMENTS OF CONSOLIDATED OPERATIONS & RETAINED EARNINGS
                (Dollars in thousands, except share amounts)
                                 (Unaudited)
                                      
                                12 Weeks Ended            40 Weeks Ended
                               Dec. 5,     Nov. 29,     Dec. 5,     Nov. 29,
                                1998        1997         1998        1997
                             ----------- ----------- ----------- -----------

Sales                       $ 2,344,400  $2,318,821  $ 7,753,035  $7,759,107
Cost of merchandise sold     (1,664,686) (1,655,094)  (5,513,730) (5,537,697)
                             ----------  ----------   ----------  ----------
Gross margin                    679,714     663,727    2,239,305   2,221,410
Store operating, general and
 administrative expense        (681,463)   (632,974)  (2,168,170) (2,099,011)
                             ----------  ----------   ----------  ----------
Income (loss)from operations     (1,749)     30,753       71,135     122,399
Interest expense                (16,212)    (18,670)     (53,025)    (62,016)
Interest income                   1,549       1,526        5,186       5,831
                             ----------  ----------   ----------  ----------
Income (loss) before income
 taxes                          (16,412)     13,609       23,296      66,214
Benefit (provision) for income
 taxes                            7,678      (2,375)      (1,910)    (15,986)
                             ----------  ----------   ----------  ----------
Income (loss)before
 extraordinary item              (8,734)     11,324       21,386      50,228

Extraordinary loss on early
 extinguishment of debt
 (net of income tax benefit
 of $394)                             -           -            -        (544)
                             ----------  ----------   ----------  ----------
Net income (loss)                (8,734)     11,234       21,386      49,684

Retained earnings at
  beginning of period           517,976     478,568      495,510     447,768
Cash dividends                   (3,829)     (3,825)     (11,483)    (11,475)
                             ----------  ----------   ----------  ----------
Retained earnings at
  end of period              $  505,413  $  485,977   $  505,413  $  485,977
                             ==========  ==========   ==========  ==========

Basic earnings (loss)
  per share:

 Income (loss) before extra-
   ordinary item             $     (.23) $      .29   $      .56  $     1.31

 Extraordinary loss on early
   extinguishment of debt             -           -            -        (.01)
                             ----------   ----------  ----------  ----------
 Net income (loss) per
   share - basic             $     (.23) $      .29   $      .56  $     1.30
                             ==========  ==========   ==========  ==========
Diluted earnings (loss)
  per share:

 Income (loss) before extra-
   ordinary item             $     (.23) $      .29   $      .56  $     1.31

 Extraordinary loss on early
   extinguishment of debt             -            -           -        (.01)
                             ----------  ----------   ----------  ----------
 Net income (loss) per share -
   diluted                   $     (.23) $      .29   $      .56  $     1.30
                             ==========  ==========   ==========  ==========
Cash dividends               $      .10  $      .10   $      .30  $      .30
                             ==========  ==========   ==========  ==========
Weighted average number of
  common shares outstanding  38,306,716  38,250,371   38,289,616  38,249,395

Common stock equivalents          2,863      86,733       35,109       9,674
                             ----------  ----------   ----------  ----------
Weighted average number of
  common and common
  equivalent shares
  outstanding                38,309,579  38,337,104   38,324,725  38,259,069
                             ==========  ==========   ==========  ==========
                                      
                  See Notes to Quarterly Report on Page 5.
                                      
                                   Page 1
                                      
               THE GREAT ATLANTIC & PACIFIC TEA COMPANY, INC.
                                      
                         CONSOLIDATED BALANCE SHEETS
                         ---------------------------
                                      
                           (Dollars in thousands)
                                      
                                         Dec. 5, 1998        Feb 28, 1998
                                         ------------        ------------
                                          (Unaudited)
ASSETS
------
  Current assets:
   Cash and short-term investments           $138,949         $   70,937
   Accounts receivable                        214,169            227,703
   Inventories                                946,077            882,229
   Prepaid expenses and other assets           38,235             36,358
                                           ----------         ----------
     Total current assets                   1,337,430          1,217,227
                                           ----------         ----------

  Property:
   Property owned                           1,604,145          1,506,819
   Property leased                             86,219             90,058
                                           ----------          ---------
     Property-net                           1,690,364          1,596,877
  Other assets                                175,912            181,149
                                           ----------         ----------
  Total assets                             $3,203,706         $2,995,253
                                           ==========         ==========















                  See Notes to Quarterly Report on Page 5.
                                      
                                      
                                      
                                      

                                   Page 2

               THE GREAT ATLANTIC & PACIFIC TEA COMPANY, INC.
                                      
                         CONSOLIDATED BALANCE SHEETS
                         ---------------------------
                           (Dollars in thousands)

                                         Dec. 5, 1998     Feb. 28, 1998
                                         ------------     -------------
                                           (Unaudited)
LIABILITIES & SHAREHOLDERS' EQUITY
----------------------------------
  Current liabilities:
   Current portion of long-term debt       $    5,489       $   16,824
   Current portion of obligations under
     capital leases                            11,728           12,293
   Accounts payable                           542,271          441,149
   Book overdrafts                            154,305          151,846
   Accrued salaries, wages and benefits       151,154          146,064
   Accrued taxes                               61,597           57,856
   Other accruals                             123,732          129,098
                                           ----------       ----------
     Total current liabilities              1,050,276          955,130
                                           ----------       ----------

  Long-term debt                              796,262          695,292
                                           ----------       ----------
  Obligations under capital leases            114,035          120,980
                                           ----------       ----------
  Deferred income taxes                       119,374          120,618
                                           ----------       ----------
  Other non-current liabilities               199,334          176,601
                                           ----------       ----------
  Commitments and contingencies
  Shareholders' equity:
   Preferred stock--no par value;
     authorized--3,000,000 shares;
     issued--none                                   -                -
   Common stock--$1 par value; authorized--
     80,000,000 shares; issued and
     outstanding 38,286,716 and 38,252,966,
     respectively                              38,287           38,253
   Capital surplus                            454,848          453,894
   Cumulative translation adjustment          (67,913)         (54,815)
   Minimum pension liability adjustment        (6,210)          (6,210)
   Retained earnings                          505,413          495,510
                                           ----------       ----------
   Total shareholders' equity                 924,425          926,632
                                           ----------       ----------
   Total liabilities and shareholders'
     equity                                $3,203,706       $2,995,253
                                           ==========       ==========
                  See Notes to Quarterly Report on Page 5.
                                      
                                   Page 3
                THE GREAT ATLANTIC & PACIFIC TEA COMPANY, INC.
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                           (Dollars in thousands)
                                 (Unaudited)
                                      
                                                       40 Weeks Ended

                                              Dec. 5, 1998     Nov. 29, 1997
                                              --------------   -------------
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income                                   $ 21,386          $  49,684
   Adjustment to reconcile net income
     to cash provided by operating activities:
   Depreciation and amortization                 181,442            179,165
   Deferred income tax (benefit) provision        (3,249)             7,047
   (Gain) on disposal of owned property
     and write-down of property, net               3,939             (7,666)
   (Increase) decrease in receivables              9,386            (24,853)
   Increase in inventories                       (72,706)           (60,826)
   (Increase) decrease in prepaid expenses
     and other current assets                      2,336               (575)
   (Increase) decrease in other assets             4,826             (5,872)
   Increase in accounts payable                  108,858             23,113
   Increase(decrease) in accrued salaries,
     wages and benefits                            1,432             (6,229)
   Increase in accrued taxes                       4,125              8,556
   Increase in other accruals
     and other liabilities                        36,690              8,956
   Other operating activities, net                (3,188)            (1,525)
                                               ---------          ---------
Net cash provided by operating activities        295,277            168,975
                                               ---------          ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Expenditures for property                     (307,875)          (204,104)
  Proceeds from disposal of property               6,297             17,840
                                               ---------          ---------
Net cash used in investing activities           (301,578)          (186,264)
                                               ---------          ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Changes in short-term debt                     (22,500)           (38,000)
  Proceeds under revolving lines of credit       415,000            647,148
  Payments on revolving lines of credit         (300,000)          (777,118)
  Proceeds from long-term borrowings               3,642            301,523
  Payments on long-term borrowings                (6,507)           (30,678)
  Decrease in book overdrafts                      7,098             13,177
  Principal payments on capital leases            (9,274)            (9,522)
  Deferred financing fees                              -             (2,532)
  Cash dividends                                 (11,483)           (11,475)
  Proceeds from stock options exercised              988                 93
                                               ---------          ---------
Net cash provided by financing activities         76,964             92,616
                                               ---------          ---------
Effect of exchange rate changes on
  cash and short-term investments                 (2,651)            (1,659)
                                               ---------          ---------
NET INCREASE IN CASH AND
  SHORT-TERM INVESTMENTS                          68,012             73,668

Cash and Short-Term Investments
  at Beginning of Period                          70,937             98,830
                                               ---------          ---------
CASH AND SHORT-TERM INVESTMENTS
  AT END OF PERIOD                             $ 138,949          $ 172,498
                                               =========          =========
                                      
                  See Notes to Quarterly Report on Page 5.
                                      
                                      
                                   Page 4
                                      
               THE GREAT ATLANTIC & PACIFIC TEA COMPANY, INC.
                          NOTES TO QUARTERLY REPORT
                          -------------------------

1) BASIS OF PRESENTATION

   The consolidated financial statements for the 40 weeks ended December  5,
   1998  and  November  29,  1997  are unaudited,  and  in  the  opinion  of
   management,  all  adjustments necessary for a fair presentation  of  such
   financial statements have been included.  Such adjustments consisted only
   of   normal   recurring  items.   Interim  results  are  not  necessarily
   indicative of results for a full year.

   The consolidated financial statements include the accounts of the Company
   and all majority-owned subsidiaries.

   This  Form  10-Q  should  be  read  in  conjunction  with  the  Company's
   consolidated financial statements and notes incorporated by reference  in
   the 1997 Annual Report on Form 10-K.

   Certain  reclassifications have been made to the prior periods' financial
   statements in order to conform to the current period presentation.


2) INCOME TAXES

   The income tax provisions recorded for the 40 week period ended in fiscal
   years  1998 and 1997 reflect the Company's estimated expected annual  tax
   rates applied to their respective domestic and foreign financial results.
   For  the  40 week period ended in fiscal years 1998 and 1997, the  income
   tax  provisions  mainly  reflect taxes on U.S. income,  as  the  Canadian
   income  tax expense is principally offset by the reversal of its deferred
   tax  asset valuation allowance. During the 40 week period ended in fiscal
   years  1998  and 1997, the Canadian operations generated pretax  earnings
   and  reversed a portion of the valuation allowance to the extent of  such
   pretax  earnings.   The reversal of the valuation allowance  amounted  to
   $8.9  million  and $12.6 million for the 40 week period ended  in  fiscal
   years  1998  and  1997, respectively.  Although Canada  generated  pretax
   earnings,  the Company was unable to conclude that the Canadian  deferred
   tax  assets were more likely than not to be realized. This conclusion was
   based  in  part  on  Management's assessment of the competitive  Canadian
   marketplace  and  the  level of the Canadian pretax earnings,  which  for
   financial  statement purposes is higher than the taxable income  for  tax
   purposes  due to differences between the financial statement  and  income
   tax  treatment  of certain items.  This is of further significance  since
   the  largest  portion of the Canadian deferred tax asset relates  to  net
   operating loss carryforwards which expire between fiscal 1999 and  fiscal
   2002.  The  positive evidence that Management believes  is  necessary  in
   order to reverse some or all of the Canadian deferred tax asset valuation
   allowance  includes  a  trend in earnings to a level  which  would  allow
   Management to conclude that it is more likely than not that a portion  or
   all  of the deferred tax assets would be realized.  However, as noted  in
   Footnote 7 Subsequent Event herein, the Company will reverse the valuation
   allowance as a result of the actions described therein during the  fourth
   quarter of fiscal 1998.

                                   PAGE 5


3) FOOD BASICS FRANCHISING

   As  of  December  5,  1998, the Company served 55 Food Basics  franchised
   stores.  These franchisees are required to purchase inventory exclusively
   from  the  Company  which acts as a wholesaler to the  franchisees.   The
   Company  had  sales to these franchised stores of $296 million  and  $252
   million  for  the  40 week period ended in fiscal years  1998  and  1997,
   respectively.  In addition, the Company subleases the stores  and  leases
   the  equipment  in  the  stores  to the franchisees.   The  Company  also
   provides  merchandising, advertising, accounting and  other  consultative
   services  to  the  franchisees for which it receives a fee  which  mainly
   represents the reimbursement of costs incurred to provide such services.

   Included   in   other   assets  are  Food  Basics  franchising   business
   receivables,  net  of  allowance  for  doubtful  accounts,  amounting  to
   approximately  $33  million  and $38 million  at  December  5,  1998  and
   February 28, 1998, respectively.

   The  inventory notes are collateralized by the inventory in  the  stores,
   while the equipment lease receivables are collateralized by the equipment
   in  the stores.  The current portion of the inventory notes and equipment
   leases,   net   of   allowance  for  doubtful  accounts,   amounting   to
   approximately $2 million are included in accounts receivable at  December
   5, 1998 and  February 28, 1998.

   The  repayment of the inventory notes and equipment leases are  dependent
   upon  positive operating results of the stores.  To the extent  that  the
   franchisees incur operating losses, the Company establishes an  allowance
   for  doubtful accounts.  The Company continually assesses the sufficiency
   of  the  allowance  on a store by store basis based  upon  the  operating
   losses  incurred  and the related collateral underlying the  amounts  due
   from  the  franchisees.  In the event of default  by  a  franchisee,  the
   Company  reserves the option to reacquire the inventory and equipment  at
   the store and operate the franchise as a corporate owned store.


4) EXTRAORDINARY ITEM

   During  the  second  quarter of fiscal 1997, the  Company  retired  at  a
   premium of approximately $0.9 million, mortgages amounting to $20 million
   with an effective interest rate of 9.44%.

5) WRITE-DOWN OF PROPERTY

   During  the third quarter of fiscal 1998, the Company made a decision  to
   no  longer  proceed with a future store site.  Accordingly, in the  third
   quarter of fiscal 1998 the Company recorded a charge of approximately  $7
   million to write-down the property to its fair market value.

6) NEW ACCOUNTING PRONOUNCEMENTS

   Effective  March  1,  1998  the Company adopted  Statement  of  Financial
   Accounting  Standards  No. 130, "Reporting Comprehensive  Income."   This
   Statement  requires  that  all  components  of  comprehensive  income  be
   reported prominently in the financial statements.  Currently, the Company
   has  other  comprehensive income relating to foreign currency translation
   adjustment.   The Company's total comprehensive income is as follows  (in
   thousands):

                                   12 Weeks Ended           40 Weeks Ended
                                Dec. 5,      Nov. 29,    Dec. 5,     Nov. 29,
                                  1998         1997        1998        1997
                                --------     --------    -------     --------

   Net income                  $ (8,734)    $11,234      $21,386     $49,684
   Foreign currency translation
     adjustment                  (2,114)     (5,518)     (13,098)     (6,188)
                                --------    -------      -------     -------
   Total comprehensive income
     (loss)                    $(10,848)    $ 5,716      $ 8,288     $43,496
                               =========    =======      =======     =======


                                 PAGE 6


   In  June  1998, the Financial Accounting Standards Board issued Statement
   of  Financial  Accounting Standards No. 133, "Accounting  for  Derivative
   Instruments  and  Hedging  Activities"  ("SFAS  133").   This   Statement
   requires  that all derivative instruments be measured at fair  value  and
   recognized  in  the statement of financial position as either  assets  or
   liabilities.  The Company is currently studying the effects of  SFAS  133
   on  its cross-currency and interest rate swaps and expects to adopt  SFAS
   133 in fiscal 2000.


7) SUBSEQUENT EVENT


   On  December 8, 1998, the Company's Board of Directors approved a plan to
   exit  127  non-strategic, underperforming store locations throughout  the
   U.S.  and  Canada  and  the  further consolidation  of  distribution  and
   administrative functions.  As a result of the exit program, in the fourth
   quarter  ending  February 27, 1999, the Company will record  as  part  of
   store  operating, general, and administrative expense an after-tax charge
   in  the  range  of  $120  to  $160  million  associated  with  the  lease
   obligations  and  write-down  of  fixed  assets  related  to  the  stores
   identified and other charges in the Company's exit program.

   In conjunction with the actions to be taken relating to Canada as part of
   this  strategic initiative and exit program the Company will reverse  the
   Canadian  subsidiary's  deferred  tax asset  valuation  allowance.   This
   conclusion  was  reached due to the elimination of the losses  that  were
   generated  by  the underperforming stores which results in the  remaining
   operations  being  profitable  at a level  which  enables  Management  to
   conclude  that  it is more likely than not that the deferred  tax  assets
   will be realized.  Accordingly, in the fourth quarter ending February 27,
   1999, the Company will record a tax benefit of approximately $60 million,
   reversing the deferred tax asset valuation allowance originally  recorded
   in fiscal 1994.

   As  a  result of the fourth quarter charges, the Company will not  be  in
   compliance, as of February 27, 1999, with certain financial covenants  of
   the  unsecured five year $498 million revolving credit agreement expiring
   June  10,  2002  (the  "Credit Agreement").   The  Company  has  been  in
   discussion with its banks in order to obtain the necessary waivers of the
   covenants.  Although there is no assurance, the Company expects to obtain
   the  waivers prior to February 27, 1999.  The Company believes  that  the
   costs  of  the  waivers will not have a material impact on the  Company's
   statement of operations or the statement of position.

   As  of December 5, 1998, the Company was in compliance with all covenants
   relating the Credit Agreement and other notes.

                                      
                                      
                                   PAGE 7
                                      
                                      
               THE GREAT ATLANTIC & PACIFIC TEA COMPANY, INC.

ITEM 2.             MANAGEMENT'S DISCUSSION AND ANALYSIS
              OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
              ------------------------------------------------
                                      
                    MANAGEMENT'S DISCUSSION AND ANALYSIS
                       12 WEEKS ENDED DECEMBER 5, 1998
                      --------------------------------

OPERATING RESULTS

Sales  for  the  third  quarter ended December  5,  1998  of  $2.34  billion
increased $26 million or 1.1% from the prior year third quarter amount.  The
opening  of 19 stores in new locations, excluding replacement stores,  since
the third quarter of fiscal 1997 added approximately $59 million or 2.5%  to
sales in the third quarter of fiscal 1998.  In addition, wholesale sales  to
the  Food  Basics franchised stores increased $10 million or  12.2%  to  $89
million  for  the  12  weeks ended December 5, 1998.  These  increases  were
offset by the closure of 53 stores, excluding replacement stores, since  the
beginning of the third quarter of fiscal 1997, which reduced total sales  by
approximately  $60 million or 2.6% in the third quarter of fiscal  1998.   A
decrease  in  the Canadian exchange rate reduced third quarter  fiscal  1998
sales  by  $44 million or 1.9%.  In addition, same store sales ("same  store
sales" referred to herein include replacement stores) increased 2.6% or  $55
million from the same period last year.

Average  weekly  sales  per supermarket were approximately  $209,600  versus
$200,100 for the corresponding period of the prior year resulting in a  4.7%
increase.  Same store sales for Canadian operations increased 5.3% from  the
prior year and same store sales for U.S. operations increased 2.1% from  the
prior year.

Gross  margin as a percent of sales increased 37 basis points to  28.99%  in
the third quarter of fiscal 1998 from 28.62% for the third quarter of fiscal
1997,  resulting primarily from a better product mix of higher margin  items
coupled  with  a margin recovery at our Waldbaum's group.  The  gross margin
dollar increase of $16 million resulted from an increase in the gross margin
rate  of $8 million and an increase in sales volume of $18 million, both  of
which  were partially offset by a decrease in the Canadian exchange rate  of
$10  million.  The U.S. operations accounted for an increase of $21  million
in  gross margin rate.  The gross margin rate increased by $13 million  and
sales volume increased by $8 million.  The Canadian operations accounted for
a decrease of $5 million in gross margin.  A decrease of $5 million in gross
margin rate and a decrease of $10 million in the Canadian exchange rate were
partially offset by an increase of $10 million in sales volume.

Store  operating, general, and administrative expense increased $49  million
or  177  basis points to 29.07% from 27.30% for the corresponding period  of
the  prior  year.  This increase reflects a charge for the  closing  of  two
warehouses,  a bakery and a coffee plant and buy-outs of a number  of  store
employees.   In addition, the Company consolidated administrative  functions
in  the  Northeast  and  the management of the two  Super  Fresh  divisions.
During the quarter the Company also wrote-down a property no longer held for
a  potential  store  site and incurred professional  fees  relating  to  the
Company's  overall strategic program.  The charge to cover the  items  noted
above amounted to approximately $27 million. The $27 million in charges  are
detailed  as  follows: exit costs relating to the closure of the warehouses,
bakery  and the coffee plant amounted to approximately $4 million, of  which
approximately $1 million has been incurred or paid; severance  and  employee
buy-out costs of approximately $11 million of which approximately $5 million
has  been  paid; costs incurred in the third quarter to close the warehouses
and  coffee plant and consulting fees resulting from the Company's strategic
initiatives  amounted to approximately $5 million; and the  property  write-
down amounted to approximately $7 million.  Further the Company incurred  $4
million of higher store closing costs than the prior year as a result of the
accelerated store modernization program.  Excluding these charges  amounting
to   $31  million,  store  operating,  general  and  administrative  expense
increased approximately $18 million or 46 basis points to 27.76% from 27.30%
for the corresponding period of the prior year.  The $18 million increase is
primarily  due  to  an  increase in occupancy costs of  the  new  generation
superstores coupled with higher advertising expense.

                                   PAGE 8
                                      
                                      
Interest expense decreased $2 million or 13.2% from the corresponding period
of  the  previous  year,  primarily  due  to  a  decrease  in  average  debt
outstanding  of  approximately $50 million for the third quarter  of  fiscal
1998 as compared to the third quarter of fiscal 1997.

Interest  income  of approximately $2 million approximated  the  prior  year
amount.

Loss  before income taxes for the third quarter ended December 5,  1998  was
$16  million compared to income of $14 million for the comparable period  in
the prior year for a decrease of approximately $30 million.  Included in the
third  quarter  results  for  the current year  are  $27  million  of  store
operating general and administrative charges discussed above and $4  million
of  higher  store  closing costs.  Excluding these amounts which  total  $31
million, income before income taxes for the 12 week period ended December 5,
1998  would  have been $14 million which approximated the prior year  amount
and  was  comprised of higher gross margin of $16 million and lower interest
expense  of $2 million, fully offset by higher store operating, general  and
administrative expense of $18 million.

The income tax benefit recorded in the third quarter of fiscal 1998 reflects
the  benefit  on the loss generated by the U.S. operations as  the  Canadian
operations  income tax provision was principally offset by the  reversal  of
the  deferred tax asset valuation allowance.  The effective tax rate for the
third  quarter  of  fiscal 1997 was 17.5%.  The third  quarter  fiscal  1997
income  tax provision mainly reflects taxes on U.S. income, as the  Canadian
income tax expense was principally offset by the reversal of its deferred tax
asset valuation allowance.  During the third quarter of fiscal 1998 and 1997
the Canadian operations generated pretax earnings and reversed a portion  of
the valuation allowance to the extent of such pretax earnings.  The reversal
of the valuation allowance amounted to $1.2 million and $3.7 million for the
12  week  period of fiscal years 1998 and 1997, respectively.  The valuation
allowance  reversal  for the 40 week period of fiscal years  1998  and  1997
amounted  to $8.9 million and $12.6 million, respectively.  Although  Canada
generated  pretax  earnings, the Company was unable  to  conclude  that  the
Canadian deferred tax assets were more likely than not to be realized.  This
conclusion  was based in part on Management's assessment of the  competitive
Canadian  marketplace and the level of the Canadian pretax  earnings,  which
for  financial statement purposes is higher than the taxable income for  tax
purposes  due to differences between the financial statement and income  tax
treatment  of  certain  items.  This is of further  significance  since  the
largest  portion of the Canadian deferred tax asset relates to net operating
loss  carryforwards which expire between fiscal 1999 and  fiscal  2002.  The
positive evidence that Management believes is necessary in order to  reverse
some  or all of the Canadian deferred tax asset valuation allowance includes
a trend in earnings to a level which would allow Management to conclude that
it  is more likely than not that a portion or all of the deferred tax assets
would  be  realized.  During the fourth quarter, the Company has  determined
that  due  to  the actions to be taken as part of its strategic  initiatives
(see Note 7 Subsequent Events in the Financial Statements) it is more likely
than  not  that  the deferred tax asset will be realized.   Accordingly, the
Company  will reverse the valuation allowance during the fourth  quarter  of
fiscal 1998.

                                   PAGE 9
                                      
                                      
                                      
               THE GREAT ATLANTIC & PACIFIC TEA COMPANY, INC.

                    MANAGEMENT'S DISCUSSION AND ANALYSIS
                       40 WEEKS ENDED DECEMBER 5, 1998
              ------------------------------------------------

OPERATING RESULTS

Sales for the 40 weeks ended December 5, 1998 of $7.75 billion decreased  $6
million  or  0.1%  from the prior year.  The opening of  30  stores  in  new
locations,  excluding replacement stores, since the beginning of  the  third
quarter of fiscal 1997 added approximately $163 million or 2.1% to sales  in
the 40 week period of fiscal 1998.  In addition, wholesale sales to the Food
Basics franchised stores increased $44 million or 17.4% to $296 million  for
the  40  week period ended December 5, 1998.  These increases were partially
offset by the closure of 95 stores, excluding replacement stores, since  the
beginning of fiscal 1997, of which 11 have been sold in the Carolina market,
which  reduced total sales by approximately $203 million or 2.6% in  the  40
week  period  of  fiscal  1998.  A decrease in the  Canadian  exchange  rate
reduced sales by $104 million or 1.3% in the 40 week period of fiscal  1998.
In addition, same store sales ("same store sales" referred to herein include
replacement stores) increased 1.1% or $78 million from the same period  last
year.

Average  weekly  sales  per supermarket were approximately  $206,600  versus
$198,800 for the corresponding period of the prior year resulting in a  3.9%
increase.  Same store sales for Canadian operations increased 4.4% from  the
prior year and same store sales for U.S. operations increased 0.5% from  the
prior year.

Gross margin as a percent of sales increased 25 basis points to 28.88%  from
28.63% for the prior year, resulting primarily from a better product mix  of
higher  margin items coupled with a margin recovery at our Waldbaums  group.
The gross margin dollar increase of $18 million resulted from an increase in
the  gross margin rate of $20 million and an increase in sales volume of $23
million,  both of which were partially offset by a decrease in the  Canadian
exchange rate of $25 million.  The U.S. operations accounted for $23 million
gross  margin  increase  as the increase in the gross  margin  rate  of  $27
million was partially offset by a sales volume decrease which reduced  gross
margin  by $4 million.  The Canadian operations accounted for a decrease  of
$5  million in gross margin.  A decrease of $7 million in gross margin  rate
and  a  decrease of $25 million in the Canadian exchange rate were partially
offset by an increase of $27 million in sales volume.

Store  operating, general, and administrative expense increased $69  million
or  92  basis points to 27.97% from 27.05% for the prior year.  Included  in
store  operating,  general and administrative expenses is a  second  quarter
litigation  charge  of  $4  million coupled third quarter  charges  for  the
closing  of  two warehouses, a bakery and a coffee plant and buy-outs  of  a
number   of   store  employees.   In  addition,  the  Company   consolidated
administrative  functions in the Northeast and the  management  of  the  two
Super Fresh divisions.  During the third quarter the Company also wrote-down
a  property  no  longer  held  for  a  potential  store  site  and  incurred
professional  fees  relating to the overall strategic  program.   The  third
quarter  charge relating to the items noted above amounted to  approximately
$27  million.  Further, for the 40 week period ended December 5,  1998,  the
Company  incurred $12 million of higher store closing costs than  the  prior
year  as a result of the accelerated store modernization program.  Excluding
the  third  quarter  charges  noted above  amounting  to  $27  million,  the
litigation charge of $4 million, and the higher store closing costs of  $12
million; store operating, general, and administrative expense increased  $26
million  or  36  basis  points to 27.41% from 27.05% for  the  corresponding
period of the prior year.  This increase is primarily due to an increase  in
store  occupancy costs of the new generation superstores coupled with higher
advertising expense.

                                  PAGE 10


Interest  expense  decreased $9 million or 14.5%  from  the  previous  year,
primarily  due to a decrease in average debt outstanding of $69 million  for
the 40 week period of fiscal 1998 as compared to the prior year.

Interest  income  of approximately $5 million approximated  the  prior  year
amount.

Income before income taxes for the 40 week period ended December 5, 1998 was
$23  million compared to $66 million for the comparable period in the  prior
year  for  a  decrease of approximately $43 million or 65%.   Excluding  the
third quarter charges noted above of $27 million, the litigation charge  and
the  higher store closing costs,  income before income taxes for the 40 week
period  ended  December  5, 1998 would have been approximately  $66  million
which  approximated the prior year amount and  was comprised of higher gross
margin of $18 million and lower interest expense of $9 million, fully offset
by  higher  store  operating,  general and  administrative  expense  of  $27
million.

Recent Developments

On  December 8, 1998, the Company's Board of Directors approved  a  plan  to
exit  127 non-strategic, underperforming store locations throughout the U.S.
and  Canada and the further consolidation of distribution and administrative
functions.   As  a result of the exit program, in the fourth quarter  ending
February  27,  1999,  the Company will record as part  of  store  operating,
general, and administrative expense an after-tax charge in the range of $120
to  $160  million  associated with the lease obligations and  write-down  of
fixed  assets  related  to the stores identified and other  charges  in  the
Company's exit program.

In  conjunction with the actions to be taken relating to Canada as  part  of
this  strategic  initiative and exit program the Company  will  reverse  the
Canadian   subsidiary's  deferred  tax  asset  valuation  allowance.    This
conclusion  was  reached  due to the elimination of  the  losses  that  were
generated  by  the  underperforming stores which results  in  the  remaining
operations being profitable at a level which enables management to  conclude
that  it  is  more  likely than not that the deferred  tax  assets  will  be
realized.   Accordingly, in the fourth quarter ending February  27,  1999,
the  Company  will  record  a  tax  benefit of  approximately  $60  million,
reversing the deferred tax asset valuation allowance originally recorded  in
fiscal 1994.



LIQUIDITY AND CAPITAL RESOURCES

The  Company  ended the third quarter with working capital of  $287  million
compared  to $262 million at the beginning of the fiscal year.  The  Company
had  cash and short-term investments aggregating $139 million at the end  of
the  third quarter of fiscal 1998 compared to $71 million as of fiscal  1997
year  end.   Short-term investments were approximately $27 million  and  $20
million at December 5, 1998 and February 28, 1998, respectively, which  were
primarily invested in commercial paper.

The  Company  has  an  unsecured  five year $498  million  revolving  credit
agreement  (the "Credit Agreement") expiring June 10, 2002, with a syndicate
of  banks,  enabling it to borrow funds on a revolving basis  sufficient  to
refinance short-term borrowings.  The Credit Agreement is comprised  of  the
U.S.  credit  agreement amounting to $465 million and  the  Canadian  credit
agreement amounting to C$50 million (U.S. $33 million at December 5,  1998).
As of December 5, 1998, the Company had $205 million outstanding against the
Credit Agreement.  Accordingly, as of December 5, 1998, the Company had $293
million available under the Credit Agreement.


                                   PAGE 11
                                      
                                      
In   addition  to  the  Credit  Agreement,  the  Company  also  has  various
uncommitted  lines of credit with numerous banks.  As of December  5,  1998,
the  Company had $15 million outstanding on the uncommitted lines of credit.
The Company has an additional $206 million available in uncommitted lines of
credit as of December 5, 1998.

The  Company's  Credit  Agreement and certain of its notes  contain  various
financial covenants which require among other things, minimum net worth  and
maximum  levels of indebtedness and lease commitments.  The Company  was  in
compliance  with all such covenants as of December 5, 1998.  However,  as  a
result  of  the  Company's plan to exit 127 stores beginning in  the  fourth
quarter ending February 27, 1999, the Company will not be in compliance with
certain  financial covenants of the Credit Agreement for the quarter  ending
February  27,  1999.  The Company has been in discussion with its  banks  in
order  to obtain the necessary waivers of the covenants.  Although there  is
no  assurance, the Company expects to obtain the waivers prior  to  February
27,  1999.  The Company believes that the costs of the waivers will not have
a  material impact on the Company's statement of operations or the statement
of position.

On  July  1,  1998,  Moody's  Investor's Service  downgraded  the  Company's
existing  senior  debt rating to Ba1 from Baa3.  The Company's  rating  from
Standard & Poor's remained unchanged from the fiscal year end rating of
BBB-.  Rating changes could affect the availability and cost of financing to
the Company.

For  the  40  weeks ended December 5, 1998, the net cash used  in  investing
activities totaled $302 million.  This included capital expenditures of $308
million,  which  included  30 new stores and 54 remodels  and  enlargements.
Currently, the Company projects that total cash used in investing activities
for fiscal 1998 will amount to approximately $360 million.  Accordingly, the
Company  expects  to have cash outlays relating to investing  activities  of
approximately $52 million throughout the remainder of fiscal 1998.


These  available  cash  resources, assuming  that waivers  are  obtained  as
anticipated,  together with income from operations, are sufficient  for  the
Company's  capital expenditure program, mandatory scheduled debt  repayments
and dividend payments for fiscal 1998 and fiscal 1999.



YEAR 2000 COMPLIANCE

The Company has formed an ongoing task force to review the entire range of
the Company's operations relating to Year 2000 issues.  This task force
reports to the Vice Chairman of the Board of Directors.  Assessment of those
functions of the business that require attention and resources to achieve
Year 2000 compliance is in progress throughout the entire organization.  The
Information Technology ("IT") assessment is complete and the non-IT areas are
approximately 25% complete.  The current estimate of the remediation effort
(including new programs and components) is approximately 60% complete in the
IT area and has commenced in the non-IT area.  Testing of the systems and
implementation of renovated and new systems are currently in progress.  A
number of renovated and new systems that are year 2000 compliant are
currently being used in operations.


                                   PAGE 12

The costs to address the Company's Year 2000 issues are estimated to be
approximately $5 million.  Approximately $2.2 million of these costs have
been incurred from 1997 through the third quarter of 1998.  In addition, the
Company will incur additional capital expenditures of approximately $5
million for new equipment during the remainder of fiscal 1998 and fiscal 1999
that is Year 2000 compliant.  Some IT projects have been deferred due to the
Year 2000 project, however, the Company believes that such a deferral will
not affect the Company's financial performance.

From  an  IT  perspective, the task force is responsible  for  assessing  the
extent  of  affected software/hardware  and developing procedures to  resolve
the   potential   problems  associated  with  that  software/hardware.    The
procedures  developed include making the necessary changes  to  the  affected
software,  adequately  testing  the changes and  phasing  in  the  Year  2000
compliant  programs  to  limit disruption or delay in  the  Company's  normal
business  activities.  The Company is also in the process of updating  vendor
software  packages to the latest versions to insure all Company  software  is
Year  2000 compliant.  Some in-store IT systems as well as other support area
IT systems will also need remediation to become Year 2000 compliant.

The risks of Year 2000 issues from a non-IT area are principally as follows:
electrical outages resulting in breakdown of point of sale systems, lighting
and refrigeration equipment and the loss of utility service.  In addition,
certain store equipment may have imbedded chips or microprocessors that are
not Year 2000 compliant.  The Company is in the process of identifying such
equipment and either replacing the affected chips or microprocessors or
purchasing new equipment that is compliant.  The events noted above could
severely affect Company operations.  The Company plans to mitigate the
potential effect of such issues by preparing a contingency plan as discussed
below.

Significant risk also arises out of the possible failure of vendors to
respond to Year 2000 issues.  The Company is meeting with its major vendors
and suppliers to determine their state of readiness and to review the
contingency plans that they have developed.  Companies that are compliant and
have prepared for contingencies will have a status as preferred suppliers.
With respect to other vendors that either are not Year 2000 compliant or do
not have adequate contingency or remediation plans, the Company will seek
alternative sources when possible.

With respect to contingencies, a program is being developed to identify the
additional resources that will be necessary to fully run the Company when and
if, it is affected by the foregoing risk factors.  Over the next year, the
Company will continue to expand its contingency plans and detailed procedures
in order to mitigate the effects of the Year 2000 issues that might affect
the Company.

The  Company believes that it has allocated sufficient resources  to  resolve
all  significant  Year  2000  issues in a timely  manner.   Accordingly,  the
Company plans to be Year 2000 compliant by October 1999.


                                   PAGE 13

CAUTIONARY NOTE

This  report  contains certain forward-looking statements about  the  future
performance  of the Company which are based on Management's assumptions  and
beliefs  in light of the information currently available to it.  The Company
assumes  no  obligation to update the information contained  herein.   These
forward-looking  statements are subject to uncertainties and  other  factors
that  could  cause actual results to differ materially from such  statements
including,   but  not  limited  to:  the  success  of  Company's   strategic
initiatives and store exit program; competitive practices and pricing in the
food industry generally and particularly in the Company's principal markets;
the  Company's  relationships with its employees and  the  terms  of  future
collective bargaining agreements; the costs and other effects of  legal  and
administrative  cases and proceedings; the nature and  extent  of  continued
consolidation  in the food industry; changes in the financial markets  which
may  affect the Company's cost of capital and the ability of the Company  to
access the public debt and equity markets to refinance indebtedness and fund
the  Company's capital expenditure program on satisfactory terms; supply  or
quality  control  problems with the Company's vendors; changes  in  economic
conditions which affect the buying patterns of the Company's customers;  and
the  ability  of  the  Company and its vendors, financial  institutions  and
others to resolve Year 2000 processing issues in a timely manner.



                                   PAGE 14
                                      
               THE GREAT ATLANTIC & PACIFIC TEA COMPANY, INC.
                                      
                         PART II.  OTHER INFORMATION
                         ---------------------------


Item 1.  Legal Proceedings
         -----------------
         On  August  28,  1998  Capital Graphics  Advertising  Agency,  Inc.
         ("Capital  Graphics")  was awarded a verdict  against  the  Company
         amounting to $4 million.  This lawsuit is the result of the Company
         terminating  a  relationship  with an  Atlanta  printer  which  the
         Company  felt  that it had a right to terminate.  However,  a  jury
         awarded  Capital  Graphics damages, plus  interest  and  litigation
         expenses  totaling $4 million.  The Company believes  that  it  has
         several  strong  bases for the appellate court  to  set  aside  the
         jury's  verdict  and order a new trial.  Accordingly,  the  Company
         will   proceed  with  an  appeal  and  defend  against  this  claim
         vigorously.


Item 2.  Changes in Securities
         ---------------------
         None


Item 3.  Defaults Upon Senior Securities
         -------------------------------
         None


Item 4.  Submission of Matters to a Vote of Security Holders
         ---------------------------------------------------
         None


Item 5.  Other Information
         -----------------
         None


Item 6.  Exhibits and Reports on Form 8-K
         --------------------------------
         On  December  9,  1998, Form 8-K was filed with the Securities  and
         Exchange Commission with regard to the Company's December  8,  1998
         announcement relating to the Company's strategic initiatives.   The
         major elements of these initiatives include plans to close 127 non-
         strategic  stores;  to  realign  and consolidate  distribution  and
         manufacturing  facilities and administrative functions;  to  reduce
         working capital and to dispose of other non-strategic assets.






                                   Page 15
                                      
                                      
               THE GREAT ATLANTIC & PACIFIC TEA COMPANY, INC.






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.



                             THE GREAT ATLANTIC & PACIFIC TEA COMPANY, INC.



Date: January 19, 1999       By:        /s/ Kenneth A. Uhl
                                ---------------------------------------
                                Kenneth A. Uhl, Vice President and
                                Controller (Chief Accounting Officer)


































                                      
                                   Page 16