14

                                
                                
                                
                            FORM 10-Q
                                
                                
               SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C. 20549
                                
                                
[ x ]     Quarterly Report Pursuant to Section 13 or 15(d) of the
          Securities Exchange Act of 1934 For the quarterly
          period ended September 30, 1997

[   ]     Transition Report Pursuant to Section 13 or 15(d) of
          the Securities Exchange Act of 1934
                                
                                
                     Commission File Number
                             0-25732
                                
                                
                         ATLAS AIR, INC.
     (Exact name of registrant as specified in its charter)



               Delaware                 84-1207329
(State of other jurisdiction of    (IRS Employer
incorporation or organization)      Identification No.)

                                
                                
                                
            538 Commons Drive, Golden, Colorado 80401
       (Address of principal executive offices)(Zip Code)
                                
                                
                         (303) 526-5050
      (Registrant's telephone number, including area code)



Indicated 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.

                                   [ x ]   Yes         [   ]   No

As  of November 10, 1997 the Registrant had 22,450,229 shares  of
$.01 par value Common Stock outstanding.
                ATLAS AIR, INC. AND SUBSIDIARIES
                                
                                
                              INDEX
                                                                 
                                                                 
                                                                 

PART I.   FINANCIAL INFORMATION

     Item 1.   Consolidated Financial Statements

               Consolidated Balance Sheets-
                 September 30, 1997 and December 31, 1996

               Consolidated Statements of Operations-
                 Quarter and Nine Months Ended September 30, 1997
                 and 1996

               Consolidated Statements of Cash Flows-
                 Nine Months Ended September 30, 1997 and 1996

               Notes to Consolidated Financial Statements

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


PART II.  OTHER INFORMATION

     Item 6.        Exhibits and Reports on Form 8-K

                    Exhibit 27 - Financial Data Schedule

                    Signatures


                ATLAS AIR, INC. AND SUBSIDIARIES
                                
                   CONSOLIDATED BALANCE SHEETS
                (In thousands, except share data)
                                   September 30,   December 31,
                                       1997            1996
                                    (Unaudited)    
                             ASSETS
Current assets:                                                 
  Cash and cash equivalents         $    30,729      $    9,793
  Short-term investments                114,687         114,870
  Accounts receivable, net and                                 
   other                                 54,960          49,603
      Total current assets              200,376         174,266
Property and equipment:                                        
  Flight equipment                    1,083,679         638,630
  Other                                   6,881           3,933
                                      1,090,560         642,563
  Less: accumulated depreciation        (85,923)        (58,293)
    Net property and equipment        1,004,637         584,270
Other assets:                                                  
  Debt issuance costs                    22,682          12,382
  Deposits                                3,309           2,789
                                         25,991          15,171
               Total assets          $1,231,004        $773,707
                                                               
              LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:                                           
   Current portion of long-term                                
    debt and aircraft obligations     $  49,394       $  21,561
  Accounts payable and accrued                                 
   expenses                             104,178          47,763
     Income tax payable                      58           6,267
      Total current liabilities         153,630          75,591
Long-term debt, net of current          715,627         462,868
portion
Deferred aircraft obligations,          103,513              --
net of current portion
Deferred income tax payable              31,882          22,875
Commitments and contingencies                                  
(Note 5)
Stockholders' equity:                                          
  Preferred Stock, $1 par value;                               
   10,000,000 shares authorized;
   no shares issued                          --              --
  Common Stock, $0.01 par value;                               
   50,000,000 shares authorized;
   22,450,229 shares issued                 225             225
  Additional paid-in capital            172,841         172,841
  Retained earnings                      53,648          39,543
  Treasury Stock, at cost; 16,225                               
   and 5,850 shares, respectively          (362)           (236)
      Total stockholders' equity        226,352         212,373
         Total liabilities and                                 
           stockholders' equity      $1,231,004        $773,707
                                                   
      The accompanying notes are an integral part of these
               consolidated financial statements.
                                
                ATLAS AIR, INC. AND SUBSIDIARIES
                                
              CONSOLIDATED STATEMENTS OF OPERATIONS
              (In thousands, except per share data)
                           (Unaudited)

                          Quarter Ended         Nine Months Ended
                          September 30,           September 30,
                         1997       1996        1997      1996
Revenues:                                                       
  Contract services     $101,136   $ 75,101   $264,930    $199,087
 Scheduled services          339      2,145      7,020       4,719
 Charters and other        2,722      2,435      8,198       7,138
  Total operating                                                 
   revenues              104,197     79,681    280,148     210,944
                                                                  
Operating expenses:                                               
 Flight crew salaries                                             
  and benefits             7,491      6,105     21,437      16,971
 Other flight-related                                             
  expenses                 6,825      7,553     20,546      19,648
 Maintenance              33,458     21,758     88,470      54,138
 Aircraft and engine       7,794      7,072     23,279      18,745
  rentals
 Fuel and ground           1,909      3,389      9,024       7,637
  handling
 Depreciation and         11,010      6,658     30,183      16,751
  amortization
     Other                13,977      7,100     31,888      18,931
 Write-off of capital                                             
  investment and                                                 
  other                       --         --     27,100         --
    Total operating                                               
     expenses             82,464     59,635    251,927     152,821
Operating income          21,733     20,046     28,221      58,123
Other income                                                      
 (expense):
    Interest income        1,669      2,228      5,161       4,979
    Interest expense     (13,599)    (9,435)   (37,246)    (24,885)
                         (11,930)    (7,207)   (32,085)    (19,906)
Income (loss) before                                              
income taxes               9,803     12,839     (3,864)     38,217
(Provision for)                                                   
benefit from income                                               
taxes                     (3,578)    (4,638)     1,411     (13,775)
Income (loss) before                                              
extraordinary item         6,225      8,201     (2,453)     24,442
                                                                  
Extraordinary item:                                               
  Gain from                                                       
  extinguishment of
  debt, net of
  applicable taxes
  of $9,622                   --         --     16,740          --
Net income             $   6,225  $   8,201   $ 14,287    $ 24,442
                                                                  
Earnings per common                                               
share:
 Income (loss) before                                             
 extraordinary item    $    0.28  $    0.37   $  (0.11)  $   1.15
  Extraordinary item          --         --       0.75         --
 Net income per                                                   
  common share         $    0.28  $    0.37   $   0.64   $   1.15
                                                                  
Weighted average                                                  
common shares                                                    
outstanding               22,450     22,430     22,450     21,185
                                                            
The accompanying notes are an integral part of these consolidated
                      financial statements.
                                
                ATLAS AIR, INC. AND SUBSIDIARIES
                                
              CONSOLIDATED STATEMENTS OF CASH FLOWS
                         (In thousands)
                           (Unaudited)
                                           Nine Months Ended
                                             September 30,
                                            1997         1996
Operating activities:                                  
Net income                                $  14,287   $ 24,442
Adjustments to reconcile net income to                        
 net cash provided by operating
 activities:                                                  
  Depreciation and amortization              31,283     16,751
  Amortization of debt issuance cost          2,418      1,581
  Net gain on disposition of property                         
   and equipment                             (1,090)        --
  Write-off of capital investment and                         
   other                                     27,100         --
  Change in deferred income tax payable       9,007      7,850
  Extraordinary gain                        (26,362)        --
  Changes in operating assets and                             
   liabilities:
  Accounts receivable and other             (15,310)   (16,916)
  Deposits                                     (520)       629
  Accounts payable and accrued expenses      44,065     16,405
  Income tax payable                         (6,209)     5,515
                                                              
    Net cash provided by operating                            
     activities                              78,669     56,257
                                                              
Investment activities:                                        
Purchase of property and equipment         (335,526)  (198,896)
Sale of property and equipment                3,750         --
Purchase of short-term investments       (1,270,707)  (189,083)
Maturity of short-term investments        1,270,890     76,442
  Net cash used in investing activities    (331,593)  (311,537)
                                                              
Financing activities:                                         
Issuance of Common Stock                         --    106,278
Purchase of Treasury Stock                     (802)      (776)
Issuance of Treasury Stock                      493        335
Borrowings on notes payable                 769,719     94,165
Principal payments on notes payable        (479,185)   (15,554)
Debt issuance costs                         (16,365)    (5,979)
  Net cash provided by financing                              
   activities                               273,860    178,469
                                                              
Net increase (decrease) in cash              20,936    (76,811)
Cash and cash equivalents at beginning        9,793     96,990
of period
Cash and cash equivalents at end of                           
period                                    $  30,729   $ 20,179
                                                       
     The accompanying notes are an integral part of these
              consolidated financial statements.
                                
                ATLAS AIR, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           (Unaudited)
                                
                                
                                
1.   Unaudited Consolidated Financial Statements

      In  the  opinion of management, the accompanying  unaudited
consolidated   financial  statements  contain   all   adjustments
(consisting only of normal recurring items) necessary to  present
fairly  the financial position of Atlas Air, Inc. and its wholly-
owned  subsidiaries (collectively, the "Company") as of September
30,  1997  and the results of operations and cash flows  for  the
periods  presented.  Certain information and footnote disclosures
normally  included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed
or  omitted  pursuant to the Securities and Exchange Commission's
rules and regulations.  The results of operations for the periods
presented  are  not necessarily indicative of the results  to  be
expected  for the full year.  Management believes the disclosures
made  are  adequate  to  ensure  that  the  information  is   not
misleading,  and  recommends that these financial  statements  be
read  in conjunction with the Company's December 31, 1996 audited
financial statements.

2.   Reclassifications

     Certain prior year amounts have been reclassified to conform
to current year presentation.

3.   Recently Issued Accounting Standard

      In February, 1997, the Financial Accounting Standards Board
issued  Statement of Financial Accounting Standards ("SFAS")  No.
128  "Earnings  per Share."  The purpose of SFAS No.  128  is  to
simplify  the  computation of earnings per share ("EPS")  and  to
make the U.S. standard for computing EPS more compatible with the
EPS   standards  of  other  countries  and  with  that   of   the
International Accounting Standards Committee.  The effective date
for  the application of SFAS No. 128 for both interim and  annual
periods is after December 15, 1997.  Earlier application  is  not
permitted.  The Company does not expect the application  of  SFAS
No. 128 to have a material impact on its EPS calculation.

4.   Short-Term Investments

     Proceeds from the secondary public offering of the Company's
Common Stock in May 1996, plus additional funds, were invested in
various held-to-maturity securities, as defined in SFAS No.  115,
"Accounting   for   Certain  Investments  in  Debt   and   Equity
Securities," which requires investments in debt securities to  be
classified as held-to-maturity and measured at amortized cost  in
the  statement  of  financial  position  only  if  the  reporting
enterprise  has  the positive intent and ability  to  hold  those
securities  to  maturity.  The following  table  sets  forth  the
aggregate  fair  value,  gross unrealized  holding  gains,  gross
unrealized holding losses, and amortized/accreted cost  basis  by
major security type as of September 30, 1997 (in thousands):

                             Gross        Gross            
              Aggregate   Unrealized    Unrealized         
   Security      Fair       Holding      Holding    (Amortization)
     Type       Value        Gains        Losses      Accretion
                                                    
  Commercial                                                      
  Paper         $ 97,268   $         -  $        19     $     (21)
  U.S.                                                            
  Government                                                      
  Agencies        11,036             8            5          (109)
  Corporate                                                       
  Notes              200             -            -             1
  Market                                                          
  Auction                                                         
  Preferred        6,000             -            -             -
  Totals       $ 114,504    $        8  $        24     $    (129)

In  addition,  there  was approximately $.2  million  of  accrued
interest  on  Short-Term  Investments  at  September  30,   1997.
Interest  earned  on  these investments and maturities  of  these
investments are reinvested in similar securities.

5.   Commitments and Contingencies

     In  November  1994, Boeing issued Nacelle Strut Modification
Service  Bulletins which have been converted into  Directives  by
the FAA.  Twelve of the Company's 747-200 aircraft would have  to
be  brought into compliance with such Directives within the  next
three years at an estimated aggregate cost of approximately  $6.0
million.  As part of the FAA's overall aging aircraft program, it
has  issued  Directives  requiring  certain  additional  aircraft
modifications  to be accomplished prior to the aircraft  reaching
20,000 cycles.  The average cycle time for the Company's 17  747-
200  aircraft  in  service (excluding the  aircraft  leased  from
Federal  Express) is approximately 12,000 cycles and the  average
cycles  operated  per year is 800 cycles.  The Company  estimates
that  the  modification costs per aircraft will range between  $2
million and $3 million.  Between now and the year 2000, only  one
aircraft  is  expected to reach the 20,000 cycle limit  and  nine
additional aircraft will require modification prior to  the  year
2009.   The  remaining seven aircraft in service  (excluding  the
aircraft leased from Federal Express) have already undergone such
modifications.   Prior  to acquiring used 747-200  aircraft,  the
Company requires the seller to demonstrate that such aircraft are
in  compliance with all Directives as of the purchase  date.   At
the same time, the Company examines all Directives that are known
to  apply  to  such  aircraft at a future  date.   The  Company's
freighter  conversion program incorporates any and all Directives
compliance work that would otherwise have been required prior  to
the next major maintenance event in order to minimize unscheduled
maintenance.   Other  Directives have been  issued  that  require
inspections  and minor modifications to Boeing 747-200  aircraft.
It  is  possible that additional Service Bulletins or  Directives
applicable  to  the types of aircraft included in  the  Company's
fleet could be issued in the future.  The cost of compliance with
such Directives cannot be estimated, but could be substantial.

      In  January 1996, the Company entered into a contract  with
Langdon  Asset Management, Inc. for the purpose of acquiring  six
Boeing  747-200 passenger aircraft and certain spare engines  and
spare  parts  from  Thai  Airways  International  Public  Company
Limited  ("Thai Airways").  The average cost of the six aircraft,
including   conversion   costs  from   passenger   to   freighter
configuration by The Boeing Company ("Boeing"), approximates  $45
million.   The aircraft were placed into service by  the  Company
from  the  end  of  September 1996 through  September  1997.  The
Company  obtained financing from Finova Capital  Corporation  for
approximately  80% of the cost of the first aircraft.   Financing
for the acquisition and conversion of the remaining five aircraft
was  initially secured through the Aircraft Credit Facility  (see
Note  3  of  the  Company's December 31, 1996  audited  financial
statements).

      In  March 1996, the Company entered into an agreement  with
Federal  Express  Corporation ("FedEx")  to  lease  five  747-200
freighter aircraft, plus spare engines.  The first four  aircraft
sub-leased from FedEx were delivered to the Company between March
1996 and September 1996.  The fifth aircraft was delivered to the
Company in April 1997 and was subsequently placed in service as a
spare  aircraft.  Each aircraft subleased from FedEx has a  lease
term  ending  in  January 1998.  The lease rate is  $450,000  per
month  per aircraft.  While the Company has scheduled the  return
of  these  aircraft,  it  is currently  discussing  a  short-term
extension  of  the  lease term in order to operate  the  aircraft
through  the  peak cargo service season and be  able  to  perform
necessary  maintenance  in the first quarter  of  1998  prior  to
returning  the aircraft.  In addition, the Company  purchased  on
January  2, 1997 a Boeing 747 simulator from FedEx for a purchase
price of $2.1 million.

      In  January 1997, the Company extended two of its  existing
contracts with China Airlines Ltd., which were not otherwise  due
for renewal until 1998.  Each of the contracts was extended for a
further three years into the year 2001.  In addition, the Company
entered  into three long-term ACMI contracts with South  American
carriers,  two  with Fast Air Carrier, S.A. and one  with  Lineas
Aereas Suramericanas, S.A., for 1997 through 1999.

      In  February  1997,  the  Company  filed  a  complaint  for
declaratory  judgment in the Colorado District  Court,  Jefferson
County  against  Israel  Aircraft  Industries  Ltd.  ("IAI")  for
mechanical problems the Company experienced with respect  to  the
aircraft the Company sub-leased from IAI.  The Company is seeking
approximately $1 million in damages against IAI to be set off  by
the  amount,  if any, the Company owes IAI pursuant to  the  sub-
lease.   IAI  had  the case removed to the U.S.  District  Court,
District  of  Colorado  in April 1997 and  subsequently  filed  a
separate  complaint  against the Company  in  the  U.S.  District
Court,   Eastern  District  of  New  York  alleging  damages   of
approximately  $9 million based on claims arising from  the  sub-
lease.   The Company intends to vigorously defend against all  of
IAI's claims.

      In  February  1997,  the Company entered  into  the  Second
Amended  and  Restated  Credit  Agreement  with  respect  to  its
existing  Aircraft Credit Facility.  The purpose of the amendment
was  to  increase  the revolving line from $175 million  to  $275
million   for  the  purpose  of  acquiring  additional  aircraft,
including  spare  engines and modification costs associated  with
cargo  configuration, as necessary.  The Company  commenced  draw
downs  under the additional $100 million facility in  the  second
quarter of 1997.

      In  March 1997, the Company refinanced one of its  aircraft
with   Nationsbanc  Leasing  Corporation  ("Nationsbanc").   This
aircraft  was  previously financed through  the  Aircraft  Credit
Facility.   The  Nationsbanc  financing  provides  for  a   fixed
interest  rate  of 9.16% and a seven year term, extendible  under
certain circumstances to ten years.

     In March 1997, Air Support International, Inc. ("ASI") filed
a  complaint  against  the Company in the  U.S.  District  Court,
Eastern District of New York alleging actual and punitive damages
of approximately $13.5 million arising from the Company's refusal
to  pay  commissions  which ASI claims it is owed  for  allegedly
arranging  certain  ACMI  contracts.   The  Company  intends   to
vigorously defend against all of ASI's claims.

     In May 1997, the Company purchased one 747-200 aircraft from
Citicorp Investor Lease, Inc. ("Citicorp") which is currently  on
lease  to  Philippine Airlines ("PAL").  The Company is currently
negotiating the termination of the lease with PAL following which
the  aircraft  will  be  modified  from  passenger  to  freighter
configuration  by Boeing.  The aircraft was financed  with  funds
drawn under the Aircraft Credit Facility.

     In May 1997, Atlas Freighter Leasing, Inc. ("AFL"), a wholly-
owned subsidiary of the Company, entered into a $185 million term
loan  facility (the "AFL Term Loan Facility"), with Bankers Trust
Company  ("BTCo"),  an  affiliate of BT  Securities  Corporation,
acting  as  agent,  to refinance six 747-200 aircraft  previously
owned  by the Company through another wholly-owned subsidiary  of
the  Company (the "AFL Transaction").  The proceeds  of  the  AFL
Term  Loan  Facility  were used to repay an  existing  term  loan
facility  for which the Company received a significant prepayment
incentive  credit.   In  addition, this refinancing  allowed  the
Company  to  reduce  its  overall indebtedness  and  the  ongoing
interest expense associated with these aircraft.

      In  June  1997, the Company entered into an agreement  (the
"Boeing  Purchase Contract") with Boeing to purchase 10 new  747-
400  freighter  aircraft.   The 747-400  freighter  aircraft  are
currently scheduled to be delivered as follows: 4 in 1998,  2  in
1999,  3  in  2000 and 1 in 2001.  Due to production problems  at
Boeing, the Company believes that the 1998 delivery positions  of
the  747-400 aircraft may be delayed up to 60 days.  While Boeing
will  appropriately  compensate the Company  for  any  delays  in
delivery  of the 747-400 aircraft, any such delays may  adversely
impact the Company's ability to initiate service with prospective
customers in a timely fashion.  The Boeing Purchase Contract also
provides  the  Company  with  an option  to  purchase  up  to  10
additional  747-400  freighter aircraft for  delivery  from  1999
through  2002.   The Company is also discussing with  Boeing  the
possible  addition of one 747-400 aircraft to its  firm  aircraft
order.  As a result of the Company being the largest purchaser of
747-400 freighter aircraft to date, it was able to negotiate from
Boeing  a  significant discount off the aggregate list  price  of
$1.7   billion  for  the  10  747-400  freighter  aircraft,  four
installed  engines  per  aircraft and five  spare  engines.   The
Boeing  Purchase Contract requires that the Company pay  deposits
to  Boeing  prior to the delivery date of each 747-400  freighter
aircraft  (the  "Pre-Delivery  Deposits")  in  order  to   secure
delivery  of  the  747-400 freighter aircraft  and  to  defray  a
portion of the manufacturing costs.  The Company expects that the
maximum  total  amount  of  Pre-Delivery  Deposits  at  any  time
outstanding  will  be  approximately $125 million,  approximately
$100.1  million  of which was paid as of November  3,  1997.   In
addition, the Boeing Purchase Contract provides for a deferral of
a  portion  of  the  Pre-Delivery  Deposits  ("Deferred  Aircraft
Obligations")  for  which the Company accrues  interest.   As  of
September 30, 1997, there was $123.6 million of Deferred Aircraft
Obligations  outstanding, of which $20.1 million represented  the
current  portion.  The Deferred Aircraft Obligations are recorded
in  the assets and liabilities on the balance sheet based upon  a
Pre-Delivery Deposits schedule, which is an integral part of  the
Boeing Purchase Contract.

      In  August  1997,  the Company completed an  offering  (the
"Offering") of a total principal amount of $150,000,000 of its 10
3/4%  Senior Notes due 2005.  The proceeds from the Offering were
used  to,  among  other  things,  repay  short-term  indebtedness
incurred  by the Company to make Pre-Delivery Deposits  and  were
used,  and will be used, to make additional Pre-Delivery Deposits
as  they  become  due.   As  the 747-400 freighter  aircraft  are
purchased upon delivery and Pre-Delivery Deposits are refunded by
Boeing to the Company, the proceeds from the Offering may be used
to  fund  a  portion of the total purchase price of  the  747-400
freighter  aircraft  or,  alternatively,  for  general  corporate
purposes  by the Company.  Additional third-party financing  will
be  required  at  the  time of delivery of each  of  the  747-400
freighter aircraft.  The Company intends to secure such permanent
financing  from a combination of aircraft financing transactions,
including  long-term  fixed-rate  equipment  trust  certificates,
leveraged   lease  financing,  other  long-term  purchase   money
security financing or debt or equity financing.  There can be  no
assurance  that  the  Company will be able to  obtain  sufficient
financing to fund the purchase of the 747-400 freighter aircraft,
or  if such financing is available, that it will be available  on
commercially  reasonable terms.  If it is unable to  do  so,  the
Company  could be required to modify its expansion  plans  or  to
incur higher than anticipated financing costs, which could have a
material adverse effect on the Company.

     In September 1997, the Company completed certain refinancing
and  restructuring transactions (the "Refinancings") with respect
to  certain  of the Company's existing indebtedness in  order  to
provide  the  Company  with  greater  financial  flexibility   in
anticipation of the financing requirements for the acquisition of
the  747-400 freighter aircraft by, among other things, extending
maturities of certain indebtedness, reducing interest expense and
making  certain  covenants  less restrictive.   The  Refinancings
included (i) a new, $185 million seven-year amortizing term  loan
facility  (the "AFL II Term Loan Facility) for a new wholly-owned
subsidiary of the Company formed for the sole purpose  of  owning
and   leasing  four  747-200  aircraft  and  nine  spare  engines
currently  owned  by the Company and financed  by  the  Company's
existing   Aircraft  Credit  Facility;  (ii)  an  amendment   and
restatement of the Aircraft Credit Facility to (a) provide for  a
new two-year revolving period followed by a three-year amortizing
term  loan  period,  (b) provide for a reduction  in  the  credit
spread for borrowings based on financial performance and (c) make
the  financial  covenants  less  restrictive  to  facilitate  the
upcoming  financings required in connection with the  acquisition
of  the 747-400 freighter aircraft; and (iii) an amendment to the
financial  covenants of the existing AFL Term  Loan  Facility  to
facilitate  the  financings  required  in  connection  with   the
acquisition of the 747-400 freighter aircraft.

     In   September   1997,  the  Company  filed  a  registration
statement  with  the Securities and Exchange Commission  for  the
purpose   of  registering  and  exchanging  up  to  $150  million
aggregate  principal amount of its new 10 3/4% Senior  Notes  due
2005  (the  "New  Notes"),  for a like principal  amount  of  its
outstanding 10 3/4% Senior Notes due 2005 (the "Old  Notes", also
discussed  above  as  the "Offering"), which  have  not  been  so
registered.   The  terms of the New Notes are  identical  in  all
material  respects to the Old Notes, except for certain  transfer
restrictions relating to the Old Notes.  The Company  expects  to
accept  for  exchange any and all Old Notes validly tendered  and
not withdrawn prior to December 4, 1997, unless extended.
     
     In September 1997, the Company entered into an interest rate
swap  with  BTCo  for the purpose of hedging its  floating  rate
debt.   The  notional amount of the interest rate  swap  is  $210
million  for  a term of eight years.  The Company  pays  a  fixed
interest rate and receives a floating interest rate based  on  3-
month LIBOR, whereby the net interest settles quarterly.

      The  Company  is in negotiations with a lender  for  a  $25
million  revolving  credit facility for general  working  capital
purposes.

6.  Write-off of Capital Investment and Other

     In conjunction with the June 1997 agreement with Boeing to
purchase 10 new 747-400 freighter aircraft, the Company assessed
the economic viability of renewing on a longer-term basis the sub-
leases with FedEx for five 747-200 freighter aircraft.  Based on
the results of this assessment in the second quarter of 1997, the
Company decided to schedule the return of these aircraft in the
first quarter of 1998.  The Company wrote-off its remaining
investment in the five FedEx aircraft and established certain
other reserves.

     The impact of the various largely non-recurring charges was
$27.1 million, or $17.2 million on an after-tax basis, which
comprised write-offs of various leasehold improvements associated
with the Company's sub-leases with FedEx of the five 747-200
aircraft, which would otherwise be expensed over the second half
of 1997 and reserves for costs necessary to return the aircraft
upon the termination of the sub-leases.  In addition, the Company
established reserves primarily related to certain customers and
vendors for out-of-period items for which the Company is
currently in negotiations.  In addition, the  reserves include
estimates for litigation costs and other costs not expected to re-
occur.

7.  Extraordinary item

     The Company recorded an extraordinary after-tax gain of
$16.7 million, resulting from the receipt of a prepayment
incentive credit associated with the refinancing of six 747-200
aircraft representing approximately $228 million of indebtedness
in the second quarter of 1997.  This refinancing allowed the
Company to reduce its overall indebtedness and the ongoing
interest expenses associated with these aircraft.  (See Note 5)

8.   Subsequent Events

      In  October 1997, the Company drew down an additional $14.2
million  from  its  Aircraft Credit Facility  subsequent  to  the
completion  of  the  conversion of the  sixth  Thai  Aircraft  to
freighter configuration at the end of September 1997.

     In  October 1997, Atlas Flightlease, Inc. ("AFI"), a wholly-
owned  subsidiary  of  the Company, secured  2-year  LIBOR  based
financing with BTCo for approximately 80% of the purchase  price
of  the  Challenger corporate aircraft, which AFI purchased  from
MAC  Flightlease in the third quarter of 1997.   AFI  intends  to
obtain permanent financing for this aircraft; however, there  can
be  no assurance that such financing will be available to AFI  or
that  such  financing obtained will be on satisfactory terms  and
conditions.

     In November 1997, the Company began trading its common stock
on   the   New  York  Stock  Exchange  under  the  symbol  "CGO."
Previously,  the common stock of the Company was  traded  on  the
NASDAQ national Market System under the symbol "ATLS."

             MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Results of Operations

      The Company, through its predecessors, began its operations
on April 22, 1992 with one Boeing 747-200 in the service of China
Airlines Ltd. and expanded its operations to a second Boeing 747-
200 in November 1992.  These operations were undertaken on behalf
of the Company by another carrier utilizing pilot crews, dispatch
facilities, maintenance operations and other services provided by
such  carrier.   As a result, the Company's operations  prior  to
1993  were  primarily  limited to aircraft leasing  and  start-up
activities.  The Company initiated cargo services under the  name
of  Atlas  Air,  Inc.  in  February 1993.   The  Company's  fleet
currently  consists  of 22 Boeing 747-200 aircraft  in  freighter
service and two 747-200 passenger aircraft under lease to a third
party.

      The cargo operations of the Company's airline customers are
seasonal in nature, with peak activity occurring traditionally in
the  second  half  of  the year, and with a  significant  decline
occurring  in the first quarter.  This decline in cargo  activity
is  largely due to the decrease in shipping that occurs following
the  December  and  January holiday seasons associated  with  the
celebration  of Christmas and the Chinese New Year.   Certain  of
the  Company's customers have, in the past, elected to  use  that
period  of  the  year  to exercise their contractual  options  to
cancel a limited number (generally not more than 5% per year)  of
guaranteed  hours with the Company, and are expected to  continue
to  do  so  in  the future.  As a result, the Company's  revenues
typically  decline  in  the first quarter  of  the  year  as  its
contractual  aircraft  utilization level  temporarily  decreases.
The  Company seeks to schedule, to the extent possible, its major
aircraft  maintenance  activities  during  this  period  to  take
advantage of any unutilized aircraft time.

       The   aircraft   acquisitions,  lease   arrangements   and
modification  schedule are described in Note 1 of  the  Company's
December 31, 1996 audited consolidated financial statements.  The
timing  of when an aircraft enters the Company's fleet can affect
not only annual performance, but can make quarterly results vary,
thereby affecting the comparability of operations from period  to
period.

     The tables below sets forth selected financial and operating
data  for the first, second and third quarters of 1997 and  1996,
and  the  four quarters of the years ended December 31, 1996  and
1995 (dollars in thousands).

                                               1997        
                           Cumu-      3rd       2nd       1st
                          lative    Quarter   Quarter   Quarter
  Total operating                                               
  revenues               $280,148   $104,197   $93,902   $82,049
  Operating expenses      251,927     82,464   104,556    64,907
  Operating income         28,221     21,733  (10,654)    17,142
  (loss)
  Other income            (32,085)   (11,930)  (10,908)   (9,248)
  (expense)
  Net income               14,287      6,225     3,048     5,013
  Block hours              52,921     19,937    17,541    15,443
  Average aircraft                                              
  operated                   19.1       20.4      19.5      17.2
  Operating margin          10.1%      20.9%     (11)%     20.9%


                                               1996        
                           Cumu-      3rd       2nd       1st
                          lative    Quarter   Quarter   Quarter
  Total operating                                               
  revenues               $210,944    $79,681   $72,614   $58,649
  Operating expenses      152,821     59,635    49,947    43,239
  Operating income         58,123     20,046    22,667    15,410
  Other income            (19,906)    (7,207)   (6,982)   (5,717)
  (expense)
  Net income               24,442      8,201    10,037     6,203
  Block hours              40,642     15,444    14,073    11,125
  Average aircraft                                              
  operated                   13.4       15.4      14.0      10.8
  Operating margin          27.6%      25.2%     31.2%     26.3%


                                     1996
                 Cumu-      4th       3rd       2nd       1st
                lative    Quarter   Quarter   Quarter   Quarter
  Total                                                         
  operating                                                     
  revenues     $315,659   $104,715   $79,681   $72,614   $58,649
  Operating                                                     
  expenses      227,596     74,775    59,635    49,947    43,239
  Operating                                                     
  income         88,063     29,940    20,046    22,667    15,410
  Other                                                         
  income        (28,475)    (8,569)   (7,207)   (6,982)   (5,717)
  (expense)
  Net income     37,838     13,397     8,201    10,037     6,203
  Block hours    59,445     18,803    15,444    14,073    11,125
  Average                                                       
  aircraft                                                      
  operated         14.7       18.4      15.4      14.0      10.8
  Operating                                                     
  margin          27.9%      28.6%     25.2%     31.2%     26.3%


                                     1995
                 Cumu-      4th       3rd       2nd       1st
                lative    Quarter   Quarter   Quarter   Quarter
  Total                                                         
  operating                                                     
  revenues     $171,267    $56,142   $47,769   $38,418   $28,938
  Operating                                                     
  expenses      128,593     39,982    34,844    28,370    25,397
  Operating                                                     
  income         42,674     16,160    12,925    10,048     3,541
  Other                                                         
  income        (16,435)    (4,014)   (4,805)   (4,287)   (3,330)
  (expense)
  Net income     17,831      8,352     5,568     3,861        50
  Block hours    33,265     10,809     9,076     7,568     5,812
  Average                                                       
  aircraft                                                      
  operated          7.7        9.4       8.2       6.9       6.1
  Operating                                                     
  margin          24.9%      28.8%     27.1%     26.2%     12.2%


Operating Revenues and Results of Operations

     Total operating revenues for the quarter ended September 30,
1997  increased to $104.2 million compared to $79.7  million  for
the  same period in 1996, an increase of approximately 31%.   The
average  number  of aircraft in the Company's  fleet  during  the
third  quarter of 1997 was 20.4 compared to 15.4 during the  same
period in 1996.  Total block hours for the third quarter of  1997
were  19,937 compared to 15,444 for the same period in  1996,  an
increase   of  approximately  29%,  principally  reflecting   the
increase  in the size of the Company's fleet.  Revenue per  block
hour  increased  by  approximately 1% to  $5,226  for  the  third
quarter of 1997 compared to $5,159 for the third quarter of 1996.
Net income of $8.2 million for the third quarter of 1996 declined
to  a  net income of $6.2 million for the third quarter of  1997,
primarily due to the increase in interest expense associated with
the increase in aircraft in service quarter over quarter.

     Total operating revenues for the nine months ended September
30,  1997 were $280.1 million compared to $210.9 million for  the
year-earlier  period,  an  increase of  approximately  33%.   The
average number of aircraft in the Company's fleet during the nine
months  ended September 30, 1997 was 19.1 compared to 13.4 during
the  same  period in 1996.  Total block hours for the first  nine
months of 1997 were 52,921 compared to 40,642 for the same period
in 1996, an increase of approximately 30%, principally reflecting
the  increase  in the size of the Company's fleet.   Revenue  per
block  hour increased by approximately 2% to $5,294 for the first
nine  months  of  1997  compared to $5,190 for  the  year-earlier
period,  primarily as a result of an increase in  higher-yielding
charter operations.
     
     Operating income of $58.1 million for the first nine  months
of  1996 decreased to $28.2 million for the first nine months  of
1997, primarily due to the largely non-cash charge to earnings of
$27.1  million  in  the  second quarter  of  1997.   This  charge
included  the write-off of the Company's remaining balance  sheet
investment in the five aircraft sub-leased from FedEx, as well as
the  establishment  of  certain reserves  associated  with  costs
necessary to return the aircraft in the first quarter of 1998 and
other  non-recurring  items.  Excluding  this  charge,  operating
income  was  $55.3  million for the first  nine  months  of  1997
compared  to  $58.1  million for the year-earlier  period,  or  a
decrease  of  approximately 5%.  There were  an  average  of  4.6
aircraft  sub-leased  from FedEx operating  in  the  1997  period
compared  to  an  average of 1.2 aircraft sub-leased  from  FedEx
operating  in the 1996 period, with respect to which  maintenance
costs are substantially higher than for the rest of the Company's
fleet.   In addition, the Company incurred $1.2 million of  costs
in  the first quarter of 1997 related to the return of two leased
aircraft  to their respective lessors.  In the second quarter  of
1997,  the  realization  of an after-tax  extraordinary  gain  of
$16.7  million,  resulting  from  the  receipt  of  a  prepayment
incentive credit associated with the refinancing of approximately
$228  million of indebtedness during the second quarter, for  the
most  part  offset  the after-tax charge of  $17.2  million  with
respect to the impact on net income for the first nine months  of
1997.   For the nine months ended September 30, 1997, net  income
was  $14.3 million compared to $24.4 million for the year-earlier
period.   This  decrease in earnings was  primarily  due  to  the
increase  in  interest expense associated with  the  increase  in
aircraft  in  service year over year and the  higher  maintenance
costs with respect to the aircraft sub-leased from FedEx.

Operating expenses

      The  Company's principal operating expenses include  flight
crew   salaries  and  benefits;  other  flight-related  expenses;
maintenance; aircraft and engine rentals; fuel costs  and  ground
handling; depreciation and amortization; and selling, general and
administrative expenses.

      Flight crew salaries and benefits include all such expenses
for  the  Company's pilot work force.  Flight crew  salaries  and
benefits increased to $7.5 million in the third quarter  of  1997
compared  to  $6.1 million in the same period  of  1996,  due  to
increases  in the number of aircraft in the Company's  fleet  and
aircraft   block  hours.   While  actual  expense  increased   by
approximately 23% during the third quarter of 1997,  on  a  block
hour basis this expense declined by  approximately 5% to $376 per
block hour for the third quarter of 1997 from $395 per block hour
for  the same period in 1996.  For the first nine months of 1997,
actual expense increased by approximately 26%, from $17.0 million
to  $21.4 million, but on a block hour basis declined to $405 per
block  hour from $418 per block hour for the same period in 1996,
or  approximately 3%.  These reductions of approximately  5%  and
3%,  respectively, were due to increased efficiency  in  staffing
levels  and  scheduling  resulting from the  increased  level  of
operations.

      Other  flight-related expenses include hull  and  liability
insurance on the Company's fleet of Boeing 747-200 aircraft, crew
travel  and  meal expenses, initial and recurring  crew  training
costs   and  other  expenses  necessary  to  conduct  its  flight
operations.

      Other flight-related expenses decreased to $6.8 million  in
the  third quarter of 1997 compared to $7.6 million in the  third
quarter  of  1996,  but increased to $20.5 million  in  the  nine
months ended September 30, 1997 compared to $19.6 million for the
year-earlier   period,  or  approximately  a  10%  decrease   and
approximately a 5% increase, respectively, due primarily to lower
training  and travel costs in the third quarter of 1997  compared
to spending levels for such costs in the first half of 1997.  The
impact of the larger fleet size for the first nine months of 1997
compared  to  the year-earlier period was partially offset  by  a
reduction  in the Company's aircraft hull and liability insurance
rates  based  on  its  increased  size  and  favorable  operating
history.   As  a result of this and other operating efficiencies,
on  a block hour basis, other flight-related expenses declined by
approximately 30% to $342 per block hour for the third quarter of
1997 compared to $489 per block hour for the same period in 1996,
and  by  approximately 20% to $388 per block hour  for  the  nine
months  ended September 30, 1997 compared to $483 per block  hour
for the same period in 1996.

      Maintenance  expenses include all expenses related  to  the
upkeep  of  the  aircraft, including maintenance,  labor,  parts,
supplies  and  maintenance reserves.   The  costs  of  C  Checks,
significant maintenance work every 18 months, and D checks, major
maintenance events, and engine overhauls not otherwise covered by
maintenance  reserves are capitalized as they  are  incurred  and
amortized  over the life of the maintenance event.  In  addition,
in  January  1995  the Company contracted with  KLM  Royal  Dutch
Airlines   ("KLM")  for  a  significant  part  of   its   regular
maintenance  operations and support on a fixed  cost  per  flight
hour  basis.   Effective October 1996, certain  aircraft  engines
were   additionally  accepted  into  the  GE  engine  maintenance
program, also on a fixed cost per flight hour basis, pursuant  to
a 10 year maintenance agreement.

      Maintenance expense increased to $33.5 million in the third
quarter  of 1997 from $21.8 million in the same period  of  1996,
and  to $88.5 million in the nine months ended September 30, 1997
from  $54.1 million in the nine months ended September 30,  1996,
or  approximately 54% and 63%, respectively, partially due to the
increase in the Company's average fleet size and partially due to
the  higher  maintenance costs with respect to the aircraft  sub-
leased  from  FedEx.  On a block hour basis, maintenance  expense
increased   year  over  year  by  approximately  19%   and   26%,
respectively,   primarily   due  to  higher   maintenance   costs
associated  with the aircraft sub-leased from FedEx.  This  block
hour comparison represents a decrease in spending compared to the
second  quarter 1997 and the first half of 1997,  for  which  the
Company  experienced  increases of  approximately  44%  and  30%,
respectively.

      Aircraft  and  engine rentals include the cost  of  leasing
aircraft  and  spare engines, as well as the cost  of  short-term
engine  leases  required  to replace  engines  removed  from  the
Company's   aircraft   for   either  scheduled   or   unscheduled
maintenance and any related short-term replacement aircraft lease
costs.

      Aircraft and engine rentals were $7.8 million in the  third
quarter  of 1997 compared to $7.1 million in the same  period  of
1996,  and  were $23.3 million in the first nine months  of  1997
compared to $18.7 million in the first nine months of 1996, or an
increase of approximately 10% and 24%, respectively.  During  the
third  quarter  of 1997 and 1996 the Company leased approximately
the  same number of aircraft.  For the first nine months of 1997,
the  Company  leased one additional aircraft as compared  to  the
year-earlier period.  Engine rentals were comparable for the same
year over year periods.

      Because of the nature of the Company's ACMI contracts  with
its  airline  customers, under which the Company  is  responsible
only  for the ownership cost and maintenance of the aircraft  and
for supplying aircraft crews and insurance, the Company's airline
customers bear all other operating expenses, including  fuel  and
fuel  servicing; marketing costs associated with obtaining cargo;
airport  cargo handling; landing fees; ground handling;  aircraft
push-back  and  de-icing services; and specific  cargo  and  mail
insurance.   As  a  result, the Company incurs  fuel  and  ground
handling expenses only when it operates on its own behalf, either
in  scheduled services, for ad hoc charters or for ferry flights.
Fuel  expenses  for  the  Company's  non-ACMI  contract  services
include both the direct cost of aircraft fuel as well as the cost
of  delivering fuel into the aircraft.  Ground handling  expenses
for  non-ACMI contract service include the costs associated  with
servicing the Company's aircraft at the various airports to which
it operates as well as other direct flight related costs.

     Fuel and ground handling costs decreased to $1.9 million for
the  third quarter of 1997 compared to $3.4 million for the third
quarter  of  1996, and to $9.0 million for the nine months  ended
September  30, 1997 compared to $7.6 million for the nine  months
ended September 30, 1996, or a decrease of approximately 44%  and
an  increase of approximately 18%, respectively.  This was due to
the relative decrease in scheduled service, charter and other non-
ACMI  block hours to 304 block hours in the third quarter of 1997
from  680 block hours in the year-earlier period, and an increase
to 1,546 block hours for the nine months of 1997 from 1,456 block
hours in the first nine months of 1996.  In addition, fuel prices
have increased year over year for the same periods.

      Depreciation and amortization expense includes depreciation
on   aircraft,  spare  parts  and  ground  equipment,   and   the
amortization of capitalized major aircraft maintenance and engine
overhauls.

      Depreciation  and amortization expense increased  to  $11.0
million  in  the third quarter of 1997 from $6.7 million  in  the
same  period  of  1996, and to $30.2 million in  the  first  nine
months  of  1997 from $16.8 million in the first nine  months  of
1996,  or approximately 65% and 80%, respectively.  This increase
reflects  an  increase of approximately 50%  in  owned  aircraft,
approximately 150% in spare engines and an approximate three-fold
increase in spare parts for the third quarter of 1997 and for the
first  nine  months of 1997 over the same periods  in  1996.   In
addition, Other Revenues include $0.4 million and $1.1 million of
depreciation  for the third quarter of 1997 and  the  first  nine
months  of 1997, respectively, associated with the net  lease  of
two aircraft which are currently in passenger configuration.

       Other  operating  expenses  include  salaries,  wages  and
benefits  for  all  employees other than pilots;  accounting  and
legal  expenses;  supplies; travel and meal  expenses,  excluding
those of the aircraft crews; commissions; and other miscellaneous
operating costs.

      Other operating expenses increased to $14.0 million in  the
third  quarter  of 1997 from $7.1 million in the same  period  of
1996,  and  $31.9 million for the first nine months of 1997  from
$18.9  million  in the same period of 1996, or approximately  97%
and  68%  respectively, reflecting the increase in the  Company's
operations.   On a block hour basis, these expenses increased  to
$701  per  block hour in the third quarter of 1997 from $460  per
block hour in the same period of 1996, and to $603 per block hour
for the first nine months of 1997 from $466 in the same period of
1996,  or approximately 52% and 29%, respectively.  This increase
in  cost  was  due  primarily to additional personnel  and  other
resources  necessary  to properly manage the Company's  increased
operations  and  to prepare for the introduction of  the  747-400
aircraft.

Other Income (Expense)

      Other  income  (expense) consists of  interest  income  and
interest expense.  Interest income for the third quarter of  1997
was $1.7 million compared to $2.2 million for the same period  in
1996,  due  to a lower short-term investment level for the  third
quarter  of 1997 compared to the third quarter of 1996.  Interest
income  of  $5.2  million  for the  first  nine  months  of  1997
increased   from  $5.0  million  for  the  year-earlier   period,
representing  comparative short-term investment levels  for  both
nine  month periods.  Interest expense increased to $13.6 million
in the third quarter of 1997 from $9.4 million in the same period
of  1996, and to $37.2 million in the first nine months  of  1997
from  $24.9  million  in  the  first  nine  months  of  1996,  or
approximately 44% and 50%, respectively, primarily resulting from
an  increase  of  approximately 50% in financed flight  equipment
between these periods.

Income Taxes

      Pursuant to the provisions of SFAS No. 109 "Accounting  for
Income Taxes," the Company has recorded a tax provision based  on
tax  rates in effect during the period.  Accordingly, the Company
accrued  taxes at the rate of 36.5% during the third quarter  and
the  first nine months of 1997 and 36.0% during the third quarter
and first nine months of 1996.  Due to significant capital costs,
which are depreciated at an accelerated rate for tax purposes,  a
majority  of  the  Company's tax provision in  these  periods  is
deferred.

Seasonality

      The cargo operations of the Company's airline customers are
seasonal in nature, with peak activity occurring traditionally in
the  second  half  of  the year, and with a  significant  decline
occurring  in the first quarter (discussed above).  In the  first
quarter  of  1997,  the Company's customers  opted  to  take  the
majority of their contractual cancellations, in contrast to  last
year's first quarter, when very few cancellations occurred.

Liquidity and Capital Resources

     At  September  30,  1997,  the Company  had  cash  and  cash
equivalents   of   approximately   $30.7   million,    short-term
investments  of approximately $114.7 million and working  capital
of  approximately $46.7 million. During the first nine months  of
1997,  cash  and  cash equivalents increased approximately  $20.9
million, principally reflecting cash provided from operations  of
$78.7  million,  proceeds  from equipment  financings  of  $769.7
million and net proceeds from the sale and purchase of short-term
investments of $0.2 million, substantially offset by the net sale
and  purchase  of  investments in flight and other  equipment  of
$331.8  million, principal reductions of indebtedness  of  $479.2
million,  debt issuance costs of $16.4 million and  net  treasury
stock purchases of $0.3 million.
     
     In  November  1994, Boeing issued Nacelle Strut Modification
Service  Bulletins which have been converted into  Directives  by
the FAA.  Twelve of the Company's 747-200 aircraft would have  to
be  brought into compliance with such Directives within the  next
three years at an estimated aggregate cost of approximately  $6.0
million.  As part of the FAA's overall aging aircraft program, it
has  issued  Directives  requiring  certain  additional  aircraft
modifications  to be accomplished prior to the aircraft  reaching
20,000 cycles.  The average cycle time for the Company's 17  747-
200  aircraft  in  service (excluding the  aircraft  leased  from
Federal Express) is approximately 12,000 cycles and  the  average
cycles  operated  per year is 800 cycles.  The Company  estimates
that  the  modification costs per aircraft will range between  $2
million and $3 million.  Between now and the year 2000, only  one
aircraft  is  expected to reach the 20,000 cycle limit  and  nine
additional aircraft will require modification prior to  the  year
2009.   The  remaining seven aircraft in service  (excluding  the
aircraft leased from Federal Express) have already undergone such
modifications.   Prior  to acquiring used 747-200  aircraft,  the
Company requires the seller to demonstrate that such aircraft are
in  compliance with all Directives as of the purchase  date.   At
the same time, the Company examines all Directives that are known
to  apply  to  such  aircraft at a future  date.   The  Company's
freighter  conversion program incorporates any and all Directives
compliance work that would otherwise have been required prior  to
the next major maintenance event in order to minimize unscheduled
maintenance.   Other  Directives have been  issued  that  require
inspections  and minor modifications to Boeing 747-200  aircraft.
It  is  possible that additional Service Bulletins or  Directives
applicable  to  the types of aircraft included in  the  Company's
fleet could be issued in the future.  The cost of compliance with
such Directives cannot be estimated, but could be substantial.

     In  February 1997, the Aircraft Credit Facility was expanded
from $175 million to $275 million for the same purposes and under
substantially  the  same  terms and  conditions  as  the  initial
facility.   Certain  financial tests  must  be  met  before  each
purchase of aircraft and related drawdown under the facility.  To
date,  the  Company has met these tests. If in  the  future,  the
Company   cannot  meet  such  tests  because  of  the   difficult
sequencing  of  aircraft  acquisition,  aircraft  conversion  and
customer  contracts,  the Company believes that  other  financing
sources  would  be available to the Company or the Company  would
acquire aircraft using its internal cash or seek a waiver of  any
necessary  conditions.   As  part of  the  Refinancings  (defined
below),  the  Company  repaid  approximately  $168.3  million  of
previous  draw downs under the Aircraft Credit Facility  and  the
Aircraft Credit Facility was amended and restated to provide  for
$250  million  of  availability, a new two year revolving  period
and,  at the Company's option, a subsequent three year term loan.
As  of  October 1997, the Company had approximately $80.2 million
outstanding under the Aircraft Credit Facility.

     In  addition, in March 1997, the Company refinanced  one  of
its     aircraft    with    Nationsbanc    Leasing    Corporation
("Nationsbanc").  This aircraft was previously  financed  through
the Aircraft Credit Facility.  The Nationsbanc financing provides
for  a  fixed  interest  rate of 9.16% and  a  seven  year  term,
extendible under certain circumstances to ten years.

     In  May  1997,  the Company acquired from Citicorp  Investor
Lease,  Inc.  ("Citicorp") one 747-200 passenger aircraft  for  a
purchase  price of $25 million, including two spare  engines.  In
connection  with the purchase of the aircraft from Citicorp,  the
Company agreed to assume Citicorp's lessor interest in the  lease
of  such  aircraft to Philippine Airlines, Inc. ("PAL")  for  the
remainder  of  the lease term, which expires in June  1998.   The
Company   is  currently  negotiating  with  PAL  for  the   early
termination  of  the lease and delivery to the  Company  of  this
aircraft  (along  with  a  separate  747-200  passenger  aircraft
similarly   acquired  by  the  Company  in  December  1996)   for
conversion to freighter configuration, although there can  be  no
assurances in that regard.
     
     In May 1997, Atlas Freighter Leasing, Inc. ("AFL"), a wholly-
owned subsidiary of the Company, entered into a $185 million term
loan  facility (the "AFL Term Loan Facility"), with Bankers Trust
Company  ("BTCo"),  an  affiliate of BT  Securities  Corporation,
acting  as  agent,  to refinance six 747-200 aircraft  previously
owned  by the Company through another wholly-owned subsidiary  of
the  Company (the "AFL Transaction").  The proceeds  of  the  AFL
Term Loan Facility were used to repay all existing principal  and
interest  due under an existing term loan facility for which  the
Company  received a significant prepayment incentive credit.   In
addition,  this  refinancing allowed the Company  to  reduce  its
overall  indebtedness and the ongoing interest expense associated
with these aircraft.
     
     In  June  1997,  the Company entered into an agreement  (the
"Boeing  Purchase Contract") with Boeing to purchase 10 new  747-
400  freighter  aircraft.   The 747-400  freighter  aircraft  are
currently scheduled to be delivered as follows: 4 in 1998,  2  in
1999,  3  in  2000 and 1 in 2001. Due to production  problems  at
Boeing, the Company believes that the 1998 delivery positions  of
the  747-400 aircraft may be delayed up to 60 days.  While Boeing
will  appropriately  compensate the Company  for  any  delays  in
delivery  of the 747-400 aircraft, any such delays may  adversely
impact the Company's ability to initiate service with prospective
customers in a timely fashion.  The Boeing Purchase Contract also
provides  the  Company  with  an option  to  purchase  up  to  10
additional  747-400  freighter aircraft for  delivery  from  1999
through  2002.   The Company is also discussing with  Boeing  the
possible  addition of one 747-400 aircraft to its  firm  aircraft
order.  As a result of the Company being the largest purchaser of
747-400 freighter aircraft to date, it was able to negotiate from
Boeing  a  significant discount off the aggregate list  price  of
$1.7   billion  for  the  10  747-400  freighter  aircraft,  four
installed  engines  per  aircraft and five  spare  engines.   The
Boeing  Purchase Contract requires that the Company pay  deposits
to  Boeing  prior to the delivery date of each 747-400  freighter
aircraft  (the  "Pre-Delivery  Deposits")  in  order  to   secure
delivery  of  the  747-400 freighter aircraft  and  to  defray  a
portion of the manufacturing costs.  The Company expects that the
maximum  total  amount  of  Pre-Delivery  Deposits  at  any  time
outstanding  will  be  approximately $125 million,  approximately
$100.1  million  of which was paid as of November  3,  1997.   In
addition, the Boeing Purchase Contract provides for a deferral of
a  portion  of  the  Pre-Delivery  Deposits  ("Deferred  Aircraft
Obligations")  for  which the Company accrues  interest.   As  of
September 30, 1997, there was $123.6 million of Deferred Aircraft
Obligations  outstanding, of which $20.1 million represented  the
current portion.

      In  August  1997,  the Company completed an  offering  (the
"Offering") of a total principal amount of $150,000,000 of its 10
3/4%  Senior Notes due 2005.  The proceeds from the Offering were
used  to,  among  other  things,  repay  short-term  indebtedness
incurred  by the Company to make Pre-Delivery Deposits  and  were
used,  and will be used, to make additional Pre-Delivery Deposits
as  they  become  due.   As  the 747-400 freighter  aircraft  are
purchased upon delivery and Pre-Delivery Deposits are refunded by
Boeing to the Company, the proceeds from the Offering may be used
to  fund  a  portion of the total purchase price of  the  747-400
freighter  aircraft  or,  alternatively,  for  general  corporate
purposes  by the Company.  Additional third-party financing  will
be  required  at  the  time of delivery of each  of  the  747-400
freighter aircraft.  The Company intends to secure such permanent
financing  from a combination of aircraft financing transactions,
including  long-term  fixed-rate  equipment  trust  certificates,
leveraged   lease  financing,  other  long-term  purchase   money
security financing or debt or equity financing.  There can be  no
assurance  that  the  Company will be able to  obtain  sufficient
financing to fund the purchase of the 747-400 freighter aircraft,
or  if such financing is available, that it will be available  on
commercially  reasonable terms.  If it is unable to  do  so,  the
Company  could be required to modify its expansion  plans  or  to
incur higher than anticipated financing costs, which could have a
material adverse effect on the Company.

     In September 1997, the Company completed certain refinancing
and  restructuring transactions (the "Refinancings") with respect
to  certain  of the Company's existing indebtedness in  order  to
provide  the  Company  with  greater  financial  flexibility   in
anticipation of the financing requirements for the acquisition of
the  747-400 freighter aircraft by, among other things, extending
maturities of certain indebtedness, reducing interest expense and
making  certain  covenants  less restrictive.   The  Refinancings
included (i) a new, $185 million seven-year amortizing term  loan
facility  (the "AFL II Term Loan Facility) for a new wholly-owned
subsidiary of the Company formed for the sole purpose  of  owning
and   leasing  four  747-200  aircraft  and  nine  spare  engines
currently  owned  by the Company and financed  by  the  Company's
existing   Aircraft  Credit  Facility;  (ii)  an  amendment   and
restatement of the Aircraft Credit Facility to (a) provide for  a
new two-year revolving period followed by a three-year amortizing
term  loan  period,  (b) provide for a reduction  in  the  credit
spread for borrowings based on financial performance and (c) make
the  financial  covenants  less  restrictive  to  facilitate  the
upcoming  financings required in connection with the  acquisition
of  the 747-400 freighter aircraft; and (iii) an amendment to the
financial  covenants of the existing AFL Term  Loan  Facility  to
facilitate  the  financings  required  in  connection  with   the
acquisition of the 747-400 freighter aircraft.

     In   September   1997,  the  Company  filed  a  registration
statement  with  the Securities and Exchange Commission  for  the
purpose   of  registering  and  exchanging  up  to  $150  million
aggregate  principal amount of its new 10 3/4% Senior  Notes  due
2005  (the  "New  Notes"),  for a like principal  amount  of  its
outstanding 10 3/4% Senior Notes due 2005 (the "Old  Notes", also
discussed  above  as  the "Offering"), which  have  not  been  so
registered.   The  terms of the New Notes are  identical  in  all
material  respects to the Old Notes, except for certain  transfer
restrictions relating to the Old Notes.  The Company  expects  to
accept  for  exchange any and all Old Notes validly tendered  and
not withdrawn prior to December 4, 1997, unless extended.

     In September 1997, the Company entered into an interest rate
swap  with  BTCo   for the purpose of hedging its  floating  rate
debt.   The  notional amount of the interest rate  swap  is  $210
million  for  a term of eight years.  The Company  pays  a  fixed
interest rate and receives a floating interest rate based  on  3-
month LIBOR, whereby the net interest settles quarterly.

     Due to the contractual nature of the Company's business, the
Company's  management  does not consider  its  operations  to  be
highly  working capital-intensive in nature. Because most of  the
non-ACMI  costs normally associated with operations are borne  by
and  directly  paid for by the Company's customers,  the  Company
does  not  incur significant costs in advance of the  receipt  of
corresponding  revenues.  Moreover, ACMI  costs,  which  are  the
responsibility  of  the  Company, are  generally  incurred  on  a
regular,  periodic  basis ranging from flight  hours  to  months.
These  costs  are  largely matched by revenue  receipts,  as  the
Company's  contracts require regular payments from its customers,
based  upon current flight activity, generally every two to  four
weeks.  As  a  result, the Company has not  in  the  past  had  a
requirement  for a working capital facility.  The Company  is  in
negotiations  with  a lender for a $25 million  revolving  credit
facility for general working capital purposes.

     The  Company  believes  that cash on  hand,  the  cash  flow
generated from its operations and the proceeds from the May  1996
public  offering  of its common stock and the  Offering,  coupled
with  availability  under the Aircraft Credit Facility,  will  be
sufficient to meet its normal ongoing liquidity needs for 1997.

     From  time  to time the Company engages in discussions  with
third  parties  regarding possible acquisitions of aircraft  that
could  expand  the  Company's  operations.  The  Company  is   in
negotiations   for   the  acquisition  of  additional   aircraft,
principally for delivery to the Company in 1998 and beyond.
     
Forward-looking Information

      To  the extent that any of the statements contained  herein
relating  to  the Company's expectations, assumptions  and  other
Company  matters are forward-looking, they are made  in  reliance
upon  the  safe  harbor  provisions  of  the  Private  Securities
Litigation  Reform  Act of 1995.  Such statements  are  based  on
current  expectations that involve a number of uncertainties  and
risks  that could cause actual results to differ materially  from
those projected in the forward-looking statements, including, but
not  limited  to, risks associated with:  worldwide business  and
economic conditions; product demand and the rate of growth in the
air  cargo  industry; the impact of competitors  and  competitive
aircraft  and  aircraft financing availability;  the  ability  to
attract   and  retain  new  and  existing  customers;  normalized
aircraft  operating costs and reliability; management of  growth;
the  continued productivity of its workforce; dependence  on  key
personnel;  and  regulatory matters.  For additional  information
regarding these and other risk factors, reference is made to  the
Company's Annual Report on Form 10-K for the year ended  December
31, 1996.
                                
                ATLAS AIR, INC. AND SUBSIDIARIES
                                
                                
                                
                                
                                
                   PART II. OTHER INFORMATION
                                
                                
                                
ITEM 6.             EXHIBITS AND REPORTS ON FORM 8-K


a.                  Exhibits

                         Exhibit 27 - Financial Data Schedule.

b.                  Reports filed on Form 8-K

                              Report filed on Form 8 -K on
                              September 30, 1997, relative to the
                              resignation of Mickey P. Foret as
                              President and Director of the
                              Company.
                                
                           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.




                         ATLAS AIR, INC.
                          (Registrant)
                                
                                
                                
                                
Date: November 12, 1997    By:/s/ Richard H. Shuyler
                              Richard H. Shuyler
                              Senior Vice President - Finance
                              Chief Financial Officer and
                              Treasurer (Principal Accounting
                              Officer)