SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C. 20549
                          ______________________

                                FORM 10-K

(Mark One)
[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934
      For the fiscal year ended December 31, 1997

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934
     For the transition period from ________ to ________           

Commission file number 1-10746

                         JONES APPAREL GROUP, INC.
           (Exact name of registrant as specified in its charter)
                                                            
Pennsylvania                                         06-0935166
(State or other jurisdiction of                   (I.R.S. Employer
incorporation or organization)                   Identification No.)


250 Rittenhouse Circle,
Bristol, Pennsylvania                                  19007
(Address of principal executive offices)             (Zip Code)

Registrant's telephone number, including area code: (215) 785-4000

Securities registered pursuant to Section 12(b) of the Act:
                                   
                                        Name of each exchange
     Title of Each Class                 on which registered
-----------------------------       -----------------------------
Common Stock, $0.01 par value       New York Stock Exchange, Inc.

Securities registered pursuant to Section 12(g) of the Act:  None


  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.   [X] Yes    [ ] No

  Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [  ]

  The aggregate market value of the voting stock held by non-affiliates of the 
registrant as of March 23, 1998 was approximately $2,365,861,580.

  As of March 23, 1998, there were 50,322,550 shares of the registrant's
Common Stock outstanding.

<PAGE> 2
        
                 DOCUMENTS INCORPORATED BY REFERENCE

  The documents incorporated by reference into this Form 10-K and the Parts
hereof into which such documents are incorporated are listed below:

                    Document                          Part
          ------------------------------------        ----
          
          Those portions of the registrant's           III
          proxy statement for the registrant's
          1998 Annual Meeting (the "Proxy
          Statement") that are specifically
          identified herein as incorporated by
          reference into this Form 10-K.

                                 - 2 -
<PAGE> 3
                                                  
             
PART I

ITEM 1.  BUSINESS

General

  Jones Apparel Group, Inc. (the "Company") is a leading designer and 
marketer of better priced women's sportswear, suits and dresses.  The Company
has pursued a multi-brand strategy by marketing its products under several 
nationally known brands, including Jones New York, Evan-Picone and 
Rena Rowan, and the licensed brand Lauren by Ralph Lauren.  Each label is 
differentiated by its own distinctive styling and pricing strategy.  The 
Company primarily contracts for the manufacture of its products through a 
worldwide network of quality manufacturers.  The Company has capitalized on 
its nationally known brand names by entering into 32 licenses for the Jones 
New York brand name and 16 licenses for the Evan-Picone brand name with 
select manufacturers of women's and men's apparel and accessories.

Products

  The Company's brands cover the entire women's better apparel market.  Within
those brands, various product classifications include career and casual 
sportswear, dresses and suits, and a combination of all components termed 
lifestyle collection.  Career and casual sportswear are marketed as groups of 
skirts, pants, jackets, blouses, sweaters and related accessories which, 
while sold as separates, are coordinated as to styles, color schemes and 
fabrics, and are designed to be worn together.  For its sportswear and dress 
collections, the Company will develop several groups in a selling season.  
New sportswear and dress collections are introduced in four or five of the 
principal selling seasons - Spring, Summer, Fall I, Fall II and Holiday/Resort,
while suit collections have traditionally been developed for the Fall and Spring
seasons.  The introduction of different groups in each season is spaced to 
ensure that retail customers frequently are introduced to new merchandise.

  The Company's major product categories are summarized in the 
following table:

              Career            Casual           Lifestyle      Suits, Dresses
              Sportswear        Sportswear       Collection     and Other
              --------------    -------------    -------------  ----------------

Industry      Better            Better           Better          Better
Categories 

Brand Labels  Jones New York,   Jones New York   Lauren by       Jones New York,
              Jones Wear,       Sport,           Ralph Lauren,   Evan-Picone,
              Rena Rowan,       Jones Wear,      Jones New       Saville
              Evan-Picone,      Jones Jeans,     York Country        
                                Jones & Co,
                                Jones Studio  

Product       Skirts, blouses   Skirts, blouses, Skirts,         Suits,
Offerings     pants, jackets,   pants, jackets,  blouses,        dresses
              sweaters          sweaters         pants, jackets,
                                                 sweates, suits,
                                                 coats

                                  -3-
                                                   
<PAGE> 4

  The Company's success is enhanced by its ability to maintain a name brand or 
designer image while its products are generally sold in the women's better 
market at the following retail price points:


             Skirts      Blouses        Casual Tops    Suits &
Jackets      and Pants   and Sweaters   and Bottoms    Coats        Dresses
---------    ---------   ------------   -----------    ---------    ---------

$150-$280    $70-$140    $70-$200       $25-$90        $200-$450    $125-$250


  The following chart sets forth a breakdown of the Company's apparel sales by
dollar amount (in thousands and as a percentage of the Company's total sales) 
during the past three fiscal years.

                                 1997              1996               1995  
                             ------------      ------------       ------------
Career Sportswear            $613,000 45%      $529,000 52%       $439,000 57%
Casual Sportswear            $323,000 24%      $292,000 29%       $209,000 27%
Lifestyle Collection         $293,000 21%       $59,000  6%         $2,000  0%
Suits, Dresses and Other     $143,000 10%      $141,000 13%       $126,000 16%


  Career Sportswear.  The Company's flagship brand, Jones New York, offers 
consumers an extensive range of better sportswear geared primarily for the 
career woman's working needs.  Jones New York products are sold in misses, 
petites and women's sizes and are marketed under the Jones New York, Jones New 
York Petite and Jones New York Woman labels.

  Career sportswear under the Rena Rowan label is positioned at the opening 
price point in better apparel and includes misses, petites and women's sizes.

  The Company's Evan-Picone line of career sportswear is positioned at a price 
point between the Jones New York and Rena Rowan brands and includes misses 
and women's sizes.

  A career sportswear line using the Jones Wear label is sold to selected retail
accounts that do not carry the Company's other lines of career sportswear.

  Casual Sportswear.  Jones New York Sport offers a collection of casual 
sportswear which complements the Jones New York career line.  These products
are designed to be worn for weekend and informal workday dressing.  Jones New 
York Sport is offered in misses, petite and women's sizes.  The Company also 
offers a business casual collection under the Jones & Co label designed to meet 
the needs of the informal workplace and business "dress down" days.

  Jones Studio, introduced for the Spring 1996 season, provides business casual 
sportswear separates.  In 1996, the Company introduced Jones Jeans, a denim and 
cotton-based collection for the women's market.  Petites and misses sizes 
were added for Spring 1998.

    Lifestyle Collection.  Jones New York Country, introduced for the Fall 1995 
season, is a collection of classic country-styled casualwear.  Prior to 1997,
this label was exclusive to the Company's own retail outlets.  The 
distribution of Jones New York Country products has now been extended to several
specialty stores.

    In October 1995, the Company acquired an exclusive license to manufacture 
and market women's shirts, blouses, skirts, jackets, suits, sweaters, pants,
vests, coats, outerwear and hats under the Lauren by Ralph

                                  -4-   

<PAGE> 5

Lauren trademark in the United States, pursuant to license and design service 
agreements with the licensor, which expire on December 31, 2001.  Upon 
expiration of the initial term, the Company has the right to renew the 
license for an additional three-year period, provided that it meets certain 
minimum sales level requirements.  The agreements provide for the payment by the
Company of a percentage of net sales against guaranteed minimum royalty and 
design service payments as set forth in the agreements.  In July 1996, the
Company began shipping a collection of better career and casual sportswear under
this label for the Fall 1996 season.  The Company introduced a collection of
Petite sportswear which began shipping in the Fall 1997 season.  Coats and 
suits were also introduced in the Fall 1997 season.

  Suits.  The Company produces suits under the brand names Jones New York and
Saville.  Jones New York is a better priced brand.  Saville is targeted to 
sell at the opening price points of the better price category.  Jones New 
York currently offers products in misses and petite sizes and Saville offers 
petite, misses and women's sizes.  During 1997, the Company phased out its 
licensed Christian Dior suit business.

  Dresses.  The Company ships collections of career dresses under the Jones New
York and Evan-Picone brand names, targeted to sell at better prices.

  Other.  The Company also produces sportswear for the private label market.  
While there is significant additional demand in this market, the Company has 
not actively pursued more private label business in order to concentrate on 
the expansion of its name brand business.

  The Company has introduced a collection of men's casual sportswear under the
Jones New York label for the Fall 1998 selling season.

Design

  Each product line of the Company has its own design team which is 
responsible for the creation, development and coordination of the product 
group offerings within each line.  The Company believes its design staff of
215 people is widely recognized for its distinctive styling of garments and
its ability to update fashion classics with contemporary trends.  The Company's 
designers travel throughout the world for fabrics and colors, and attempt to 
stay continuously abreast of the latest fashion trends.  In addition, the 
Company actively monitors the retail sales of its products to determine changes 
in consumer trends.

  For most sportswear lines, the Company will develop several groups in a 
season.  A group typically consists of an assortment of skirts, pants, 
jackets, blouses, sweaters and various accessories.  The Company believes 
that it is able to minimize design risks because the Company often will not have
started cutting fabrics until the first few weeks of a major selling season.  
Since different styles within a group often use the same fabric, the Company
can redistribute styles and, in some cases, colors, to fit current market
demand.

  In accordance with standard industry practices for licensed products, Polo 
Ralph Lauren Corporation has the right to approve the Company's designs for
the Lauren by Ralph Lauren product line.

Manufacturing

  Apparel sold by the Company is produced in accordance with its design, 
specification and production schedules.  The Company contracts for the 
cutting and sewing of the majority of its garments with approximately 133 
contractors located in the United States and 280 in overseas locations.  The 
Company also operates one manufacturing facility of its own.  During 1997, 
approximately 30% of the Company's products were manufactured in the United
States and Mexico, and 70% in other parts of the world, primarily Asia.

                                   -5-

<PAGE> 6

  The Company believes that outsourcing allows it to maximize production 
flexibility while avoiding significant capital expenditures, work-in-process 
inventory build-ups and costs of managing a larger production work force.  
The Company's fashion designers, production staff and quality control personnel
closely supervise garments manufactured by contractors to ensure that they meet 
the Company's high standards.  See "Quality Control" below.

  The Company's products are manufactured according to plans prepared each year 
which reflect prior years' experience, current fashion trends, economic 
conditions and management estimates of a line's performance.  The Company 
orders piece goods concurrently with concept board development.  The purchase 
of piece goods is controlled and coordinated on a divisional basis.  The Company
limits its exposure to specific colors and fabrics by committing to purchase 
a portion of total projected demand with options to purchase additional 
volume if demand meets the plan.  The Company believes that its policy of 
limiting its commitments for purchases early in the season minimizes its 
exposure to excess inventory and obsolescence.

  The Company believes its extensive experience in logistics and production 
management underlies its success in coordinating with contractors who 
manufacture different garments included within the same product group.  The 
Company has had long-term mutually satisfactory business relationships with 
many of its contractors, but does not have long-term written agreements with any
of them.

  The Company has an active program in place to monitor compliance by its 
contract manufacturers with applicable laws relating to the payment of wages
and working conditions.  In 1996, the Company became a participant in the 
United States Department of Labor's Apparel Manufacturers Compliance Program for
that purpose.  Under that program, and through the Company's independent 
agreements with each of its domestic and foreign manufacturers, the Company 
regularly audits such compliance and requires corrective action when 
appropriate.

Quality Control

  The Company's comprehensive quality control program is designed to ensure that
purchased raw materials and finished goods meet the Company's exacting 
standards.  Substantially all of the fabric purchases for domestically 
manufactured garments are inspected upon receipt in either the Company's 
Pennsylvania and North Carolina warehouse facilities (where they are stored 
prior to shipment for cutting) or at the contractor's warehouse.  Fabrics for 
foreign manufactured garments are inspected by the Company's contractors upon 
receipt in their warehouses.  The Company's quality control program includes 
inspection of prototypes of each garment prior to cutting by the contractors
to ensure compliance with the Company's specifications.

  Domestic contractors are supervised by the Company's quality control staff 
based primarily in Pennsylvania, while foreign manufacturers' operations are
monitored by both Company personnel and buying agents located in other 
countries.  All finished goods are shipped to the Company's warehouses for 
final inspection and distribution.

Supplies

    The Company generally supplies the raw material to its domestic 
manufacturers and occasionally to foreign manufacturers.  Otherwise, the raw
materials are purchased directly by the manufacturer in accordance with the
Company's specifications.  Raw materials, which are in most instances made
and/or colored especially for the Company, consist principally of piece goods 
and yarn and are purchased by the Company from a number of domestic and 
foreign textile mills and converters.  The Company's foreign finished goods 
purchases are generally purchased on a letter of credit basis, while its 
domestic purchases are generally purchased on an open order basis.  
The Company does not have long-term formal arrangements

                                   -6-

<PAGE> 7

with any of its suppliers.  However, the Company has experienced little 
difficulty in satisfying its raw material requirements and considers its 
sources of supply adequate.

Marketing

  The Company distributes its products through approximately 1,225 customers, 
including department stores, specialty retailer accounts and direct mail 
catalog companies throughout the United States and Canada representing 
approximately 6,800 locations.  Department stores account for approximately 
two-thirds of the Company's sales.  The Company's ten largest customers 
accounted for approximately 67% of sales in 1997.  No single customer 
accounted for more than 10% of net sales; however, certain of the Company's 
customers are under common ownership.  When considered together as a group 
under common ownership, sales to seven department store customers currently 
owned by Federated Department Stores, Inc. ("Federated") accounted for 
approximately 20% of 1997 sales and sales to eight department store customers 
currently owned by The May Department Stores Company ("May") accounted for 
approximately 19% of 1997 sales. While the Company believes that purchasing 
decisions are generally made independently by each department store customer 
(including the stores in the Federated and May groups), in some cases the trend
may be toward more centralized purchasing decisions.  The Company attempts to 
minimize its credit risk from its concentration of customers by closely 
monitoring accounts receivable balances and shipping levels and the ongoing 
financial performance and credit status of its customers.  Among the 
Company's leading customers are May group members Lord & Taylor, Hecht's and
Foley's; Federated group members Macy's Department Stores, Lazarus and 
Bloomingdale's; and independent stores Dillard's, Dayton Hudson and Nordstrom.

  The Company has a direct sales force of 174 sales people (excluding 
employees in the Company's factory outlet stores) which includes individuals
located in the Company's New York and Toronto showrooms as well as in 
regional sales offices and showrooms that the Company leases in Atlanta, Dallas,
Los Angeles and Seattle.  The Company also has a small number of independent 
sales representatives.  In addition, senior management is actively involved 
in selling to major accounts.  Products are marketed to department stores and 
specialty retailing customers during "market weeks," which are generally four to
six months in advance of the five corresponding industry selling seasons. 

  While the Company typically will allocate a six week period to market a
line, most major orders are written within the first three weeks of any 
market period.  Since piece goods for a line usually are not cut until the 
first few weeks of a marketing period, the Company is able to tailor production
schedules and styles to current market demands and minimize excess inventory.

  As one of the primary apparel resources for many of its customers, the Company
is able to influence the mix, quantity and timing of orders placed by its
retail accounts enabling the Company to market complete lines of sportswear
and minimize excess inventory.  The Company's close relationships with its 
retail accounts allow it to efficiently monitor production schedules and 
inventories.

  The Company believes retail demand for its products is enhanced by the 
Company's ability to provide its retail accounts and consumers with 
knowledgeable sales support.  In this regard, the Company has an established
program to place retail sales specialists in many major department stores.  
These individuals have been trained by the Company to support the sale of its 
products by educating other store personnel and consumers about the Company's
products and by coordinating the Company's marketing activities with those of
the stores.  In addition, the retail sales specialists provide the Company with 
firsthand information concerning consumer reactions to the Company's 
products.  In addition, the Company has a program of designated sales 
personnel in which a store agrees to designate certain sales personnel who will 
devote a substantial portion of their time to selling Jones products in return 
for certain benefits.

                                   -7-

<PAGE> 8

  The Company employs a cooperative advertising program with its major retail 
accounts, whereby it shares the cost of its retail accounts' advertising and 
promotional expenses, up to a preset maximum percentage of the retail 
accounts' purchases.  An important part of the marketing program includes 
prominent displays of the Company's products in retail accounts' sales 
catalogs.

Factory Outlet Stores

  At December 31, 1997, the Company operated a total of 214 factory outlet 
stores and 5 full price stores. The Company operates six coffee bars in close 
proximity to six of its factory outlet stores as a convenience to its 
customers.  Manufacturer's outlet malls are generally located either in high 
traffic tourist areas or on major highways to vacation destinations and major 
cities.  The 214 factory outlet stores operated by the Company are located in 
120 outlet malls throughout the United States.  These locations are generally 
situated in select geographic markets which are not in direct competition with 
the Company's primary customers. The Company's outlet stores focus on breadth of
product line and customer service as well as value pricing. In addition to 
its brand name merchandise, these stores also sell merchandise produced by 
licensees of the Company.  The Company's outlet store expansion strategy is 
to continue to open multiple stores in select outlet malls for specific 
product lines which target different customer segments.

  The Company opened 45 and closed 26 stores in 1997 and opened 47 and closed 22
stores in 1996.  The following table sets forth certain information regarding
the number and type of stores open and aggregate store sales for each of the 
years in the three year period ended December 31, 1997.


Retail stores open at end of period:                     

Store Type              Description                      1997     1996     1995
----------------------  ----------------------------     ----     ----     ----
 
Jones New York          Jones New York sportswear          85       82       78
Jones New York          Full price retail showcase          2        2        2
                          for products
Executive Suite         Jones New York and Executive       21       28       33
                           Suite men's and women's                         
                           suits and furnishings 
Jones New York Sport    Jones New York Sport and           31       22        2
                        Jones & Co casual sportswear
Evan-Picone             Evan-Picone sportswear             15       17       23
Jones New York Country  Jones New York Country             35       22        9
                          casual sportswear
Jones New York Country  Full price retail showcase          3        2        -
                          for products 
Factory Finale          Close out merchandise              19       15       15
Other concepts          Various                             8       10       13
                                                         ----     ----     ----
Total retail stores open at end of period                 219      200      175

Aggregate net store sales (in thousands)             $153,830 $129,767 $102,307

Square footage of gross store space at end of period  607,632  557,100  478,975


Nearly all stores are leased under long-term leases (typically five years).  
The average store size is approximately 2,775 square feet, ranging from a 
minimum of 1,386 square feet to a maximum of 6,600 square feet. 

                                   -8-

<PAGE> 9

Licensing of Company Brands

  As of December 31, 1997, the Company had 32 license agreements under which 
independent licensees sell products under the Company's Jones New York (and 
related) trademarks in accordance with designs furnished or approved by the 
Company in various territories in the United States and Canada.  Current 
licenses include men's tailored clothing and overcoats, women's intimate 
apparel, women's rainwear, outerwear, leather outerwear and woolen coats, 
footwear and handbags, belts, scarves, women's swimwear, umbrellas, eyewear, 
fragrances, costume jewelry, hair accessories, and cosmetic travel accessories.
Each of the licenses provides for the payment to the Company of a percentage of 
the licensee's net sales of the licensed products against guaranteed minimum 
royalty payments which generally increase over the term of the agreement.  
During 1997, the Company received $9,436,000 of Jones New York (and related 
names) licensing income.

  As of December 31, 1997, the Company had 16 license agreements under which 
independent licensees sell products under the Company's Evan-Picone 
trademarks in accordance with designs furnished or approved by the Company 
in various territories in the United States and Canada.  These licenses include
women's woolen coats, footwear, men's tailored clothing, mens' knit and woven 
shirts and sweaters, men's neckwear, and men's and women's hosiery.  Each of 
the licenses provides for the payment to the Company of a percentage of the 
licensee's net sales of the licensed products against guaranteed minimum 
royalty payments which generally increase over the term of the agreement.  
During 1997, the Company received $5,945,000 of Evan-Picone licensing income.

Trademarks

  The Company utilizes a variety of trademarks which it owns, including Jones 
New York, Jones New York Sport, Jones & Co, Jones*Wear, Jones Wear, JNY, Jones 
New York Country, Jones Jeans, Saville, Rena Rowan, Ellen Kaye, Evan-Picone, 
Picone Sport, Elements by Evan-Picone, Picone Studio, Evan-Picone Sport, 
Executive Suite and Strictly Business.  The Company has registered or applied 
for registration for these and other trademarks for use on a variety of items of
apparel and apparel-related products in the United States and Canada.  In 
addition, the Company has registered certain of its trademarks in certain other 
countries.  The Company's material registered trademarks Jones New York, 
Jones New York Sport, Rena Rowan and Evan-Picone, have their Federal 
trademark registrations expire in 2006, 2004, 2002, and 2003, respectively, with
its other registered trademarks expiring at various dates through 2014, all of 
which are subject to renewal.  The Company carefully monitors trademark 
expiration dates to ensure uninterrupted registration of its trademarks.  The
Company also licenses the Lauren by Ralph Lauren label (see "Products" above).  
The Company regards its trademarks and other proprietary rights as valuable 
assets and believes that they have significant value in the marketing of its
products.  The Company vigorously protects its trademarks against infringement.

Imports and Import Restrictions

  The Company's transactions with its foreign manufacturers and suppliers are
subject to the risks of doing business abroad.

  The Company's import operations are subject to constraints imposed by 
bilateral textile agreements between the United States and a number of foreign 
countries, including Hong Kong, Taiwan and Korea. These agreements impose 
quotas on the amount and type of goods which can be imported into the United
States from these countries.  Such agreements also allow the United States to 
impose at any time restraints on the importation of categories of merchandise
that, under the terms of the agreements, are not subject to specified limits.

                                   -9-

<PAGE> 10

  The Company monitors duty, tariff and quota-related developments and 
continually seeks to minimize its potential exposure to quota-related risks 
through, among other measures, geographical diversification of its 
manufacturing sources, the maintenance of overseas offices, allocation of 
overseas production to merchandise categories where more quota is available 
and shifts of production among countries and manufacturers.

  The Company's imported products are also subject to United States customs 
duties and, in the ordinary course of business, the Company is from time to time
subject to claims by the United States Customs Service for duties and other
charges.

  The United States and the other countries in which the Company's products are 
manufactured may, from time to time, impose new quotas, duties, tariffs or
other restrictions, or adversely adjust presently prevailing quotas, duty or
tariff levels, which could adversely affect the Company's operations and its 
ability to continue to import products at current or increased levels.  The 
Company cannot predict the likelihood or frequency of any such events occurring.

  Because the Company's foreign manufacturers are located at greater geographic
distances from the Company than its domestic manufacturers, the Company is 
generally required to allow greater lead time for foreign orders, which 
reduces the Company's manufacturing flexibility.  Foreign imports are also 
affected by the high cost of transportation into the United States.

  In addition to the factors outlined above, the Company's future import 
operations may be adversely affected by political instability resulting in 
the disruption of trade from exporting countries, any significant fluctuation
in the value of the dollar against foreign currencies and restrictions on the 
transfer of funds.  However, the recent instability of Asian financial markets 
is not expected to have a material impact on the Company's financial results.

Backlog

  On December 31, 1997, the Company had unfilled customer orders of 
approximately $557 million, compared to approximately $419 million of such
orders at December 31, 1996.  These amounts include both confirmed orders and 
unconfirmed orders which the Company believes, based on industry practice and 
past experience, will be confirmed.  The amount of unfilled orders at a 
particular time is affected by a number of factors, including the timing of 
the receipt and processing of customer orders and scheduling of the 
manufacture and shipping of the product, which in some instances is dependent on
the desires of the customer.  Accordingly, a comparison of unfilled orders from 
period to period is not necessarily meaningful and may not be indicative of 
eventual actual shipments.

Competition

  There is intense competition in the sectors of the apparel industry in which 
the Company participates.  The Company competes with many other manufacturers,
some of which are larger and have greater resources than the Company.

  The Company competes primarily on the basis of fashion, price and quality.  
The Company believes its competitive advantages include its ability to 
effectively anticipate and respond to changing consumer demands, its premier
brand names and range of products and its ability to operate within the 
industry's production and delivery constraints.  Furthermore, the Company's 
established brand names and relationships with retailers have resulted in a 
highly loyal following of customers.

  The Company considers the risk of formidable new competitors to be minimal due
to barriers to entry such as significant startup costs and the long-term nature
of supplier and customer relations.  It has been the 

                                  -10-
<PAGE> 11

Company's belief that during the past few years, major department stores and 
specialty retailers have been increasingly unwilling to source garments from 
suppliers who are not well capitalized or do not have established reputations
for delivering quality merchandise in a timely manner.  However, there can be
no assurance that significant new competitors will not develop in the future.

Employees

  At December 31, 1997, the Company had approximately 3,135 full-time employees.
This total includes 25 in executive or senior managerial positions, 
approximately 1,870 in quality control, production, design and distribution 
positions, approximately 380 in sales, clerical and office positions and 
approximately 860 in the Company factory outlet and full-price retail stores.
The Company also employs approximately 790 part-time employees, of which 
approximately 720 work in the Company factory outlet and full-price retail 
stores.

  Approximately 350 of the Company's employees are members of the Teamsters 
Union, which has a four year labor agreement with the Company expiring in March
2002.  The Company considers its relations with its employees to be 
satisfactory.


ITEM 2.  PROPERTIES

    The general location, use and approximate size of the Company's principal 
properties, all of which are leased, are set forth below:
                             
                                                               Approximate Area
Location                      Use                              in Square Feet   
---------------------         -----------------------------    ----------------
Bristol, Pennsylvania         Headquarters, warehouse              419,200
                                and distribution
Bristol, Pennsylvania         Materials warehouse                  102,400
Bristol, Pennsylvania         Distribution warehouse               208,000
Bristol, Pennsylvania         Computer and accounting               16,425
                                services
Bristol, Pennsylvania         Administrative services               22,500
Ciudad Juarez, Mexico         Production                            66,850
Downsview, Canada             Canadian headquarters,               114,300
                                warehouse and distribution
El Paso, Texas                Administrative services               33,250
Lawrenceburg, Tennessee       Distribution warehouses            1,205,100
New York, New York            Executive and sales offices          156,700
Rural Hall, North Carolina    Materials warehouse                  232,200


  The Company leases space for 214 outlet stores, five full-price retail stores
and six coffee bars (aggregating approximately 613,500 square feet) at 
locations across the United States.  The Company also leases regional sales 
offices and showrooms in Atlanta, Dallas, Los Angeles and Seattle.  The Company
believes that its existing facilities are well maintained, in good operating 
condition and that its existing and planned facilities will be adequate for 
its operations for the foreseeable future.  

  The Company occupies a warehouse and office facility which is leased from an 
affiliated real estate partnership which is 50% owned by the Company's Chairman.
The lease runs until March 31, 1998.  Minimum annual rent payments are 
$1,000,000.  The lease was capitalized at the fair market value of the 
facility which approximated the present value of the minimum lease payments.  
Upon the expiration of the lease, the Company has agreed to purchase the 
property from the partnership for $10,500,000, which 

                                   -11-
<PAGE> 12

approximates fair market value, and enter into a sale and leaseback arrangement 
with an unrelated third party.  See "Item 13.  CERTAIN RELATIONSHIPS AND 
RELATED TRANSACTIONS."


ITEM 3.  LEGAL PROCEEDINGS

    There are no material pending legal proceedings to which the Company is a 
party or to which any of its property is subject.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

    Not Applicable.



                              PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS


                                  First       Second      Third       Fourth
                                  Quarter     Quarter     Quarter     Quarter
                                  -------     -------     -------     -------
Price range of common stock:

1997
    High                          $41 3/8     $49 1/8     $57 3/16    $57 5/16
    Low                           $32 1/8     $36 1/8     $46 5/8     $40 7/16
                                                      
1996
    High                          $24 1/4     $27 3/4     $37 3/8     $37 3/8
    Low                           $17 13/16   $23 1/4     $22 9/16    $29 5/8


  The Company's Common Stock is traded on the New York Stock Exchange under the
symbol "JNY". The above figures set forth, for the periods indicated, the 
high and low sale prices per share of the Company's Common Stock as reported 
on the New York Stock Exchange Composite Tape.  The last reported sale price 
per share of the Company's Common Stock on March 17, 1998 was $55 11/16 and on 
that date there were 154 holders of record of the Company's Common Stock.  
To date, the Company has not paid any cash dividends on shares of its Common 
Stock.  The Company anticipates that all of its future earnings will be retained
for its financial requirements and does not anticipate paying cash dividends on
its Common Stock in the foreseeable future.  All stock prices have been 
adjusted to reflect the 2-for-1 stock split effective October 2, 1996.

                                   -12-
<PAGE> 13

ITEM 6.  SELECTED FINANCIAL DATA

    The following financial information is qualified by reference to, and should
be read in conjunction with, the Company's Consolidated Financial Statements
and Notes thereto and "Management's Discussion and Analysis of Financial 
Condition and Results of Operations" contained elsewhere in this report.  
The selected consolidated financial information presented below is derived from 
the Company's audited Consolidated Financial Statements for each of the five 
years in the period ended December 31, 1997.

<TABLE>
<CAPTION>
                                           
Year Ended December 31,           1997          1996          1995          1994          1993
                            ----------    ----------      --------      --------      --------                         
<S>                         <C>           <C>             <C>           <C>           <C> 
Income Statement Data
    Net sales               $1,372,458    $1,021,042      $776,365      $633,257      $541,152    
    Licensing income <F1>       15,013        13,036        10,314         8,487         4,907
                            ----------    ----------      --------      --------      --------   
      Total revenues         1,387,471     1,034,078       786,679       641,744       546,059
    Cost of goods sold         940,149       717,250       546,413       438,575       363,742
                            ----------    ----------      --------      --------      --------
    Gross profit <F2>          447,322       316,828       240,266       203,169       182,317
    Selling, general and
     administrative expense    250,685       186,572       139,135       115,307       103,392
                            ----------    ----------      --------      --------      --------
    Operating income           196,637       130,256       101,131        87,862        78,925
    Interest expense             3,584         3,040         1,908         1,212           716
    Interest income             (1,556)         (547)         (445)         (695)         (810)
                            ----------    ----------      --------      --------      --------      
    Income before provision 
      for income taxes         194,609       127,763        99,668        87,345        79,019
    Provision for               72,884        46,889        36,183        32,425        30,660
      income taxes          ----------    ----------      --------      --------      --------
    Net income                $121,725       $80,874       $63,485       $54,920       $48,359 <F3>
                            ==========    ==========      ========      ========      ========      

Per Share Data <F4><F5>
 
Net income per share
       Basic                     $2.35         $1.55         $1.22          $1.06        $0.95 <F3>
       Diluted                   $2.26         $1.51         $1.20          $1.04        $0.92 <F3>
Dividends paid per share            -            -             -              -            -
Weighted average number
  of common shares 
  outstanding         
       Basic                    51,899        52,333        52,130         51,656       50,789
       Diluted                  53,905        53,651        53,024         52,889       52,286

<CAPTION>

December 31,                      1997          1996          1995           1994         1993
                              --------      --------      --------       --------     -------- 
<S>                           <C>           <C>           <C>            <C>          <C>
Balance Sheet Data
  Working capital             $330,569      $293,970      $260,853       $204,221     $159,175
  Total assets                 580 767       488,109       400,959        318,286      266,594
  Short-term debt,  
    including current   
    portion of capital 
    lease obligations            4,199         3,067         2,327          1,859        1,722
  Long-term debt, 
    including capital  
    lease obligations           27,290        12,141        10,151          8,029        9,545
  Stockholders' equity         435,632       376,729       314,975        248,678      189,120

</TABLE>

<F1> Represents license fees received by the Company (net of related expenses).

                                  -13-
<PAGE> 14

<F2> Historically, the Company included licensing income as a separate line 
     item in operating income.  In accordance with current industry practice, 
     the Company has included this amount in total revenues and gross profit.  
     All periods presented reflect this reclassification of licensing income.

<F3> Represents income before cumulative effect of change in accounting 
     principle for the year ended December 31, 1993.  In 1993, the Company 
     recorded a cumulative effect of a change in accounting principle for 
     income taxes as a result of the adoption of SFAS No. 109 which increased 
     net income by $1,376,000.  Basic and diluted income per share for the year
     ended December 31, 1993, including this change in accounting principle, was
     $0.98 and $0.95, respectively.

<F4> On July 30, 1996, the Company's Board of Directors approved a two-for-one 
     stock split of the Company's Common Stock in the form of a 100% stock 
     dividend for shareholders of record as of September 12, 1996.  
     Concurrently, the number of authorized shares of Common Stock was increased
     to 100,000,000.  On October 2, 1996, a total of 26,744,580 shares of Common
     Stock were issued in connection with the split.  The stated par value of
     each share remained at $0.01.  All share and per share amounts have been 
     restated to retroactively reflect the stock split.

<F5> During 1997, the Financial Accounting Standards Board issued Statement of 
     Financial Accounting Standards No. 128, "Earnings per Share," which 
     provides for the calculation of "basic" and "diluted" earnings per 
     share.  This Statement, effective for financial statements issued for 
     periods ending after December 15, 1997, requires restatement of all 
     prior-period EPS data presented.  All periods have been restated to 
     comply with the provisions of SFAS No. 128.



ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

STATEMENTS OF INCOME EXPRESSED AS A PERCENTAGE OF TOTAL REVENUES


Year Ended December 31,              1997             1996              1995
                                   ------           ------            ------ 
Net sales                           98.9%            98.7%             98.7%
Licensing income                     1.1%             1.3%              1.3%
                                   ------           ------            ------
  Total revenues                   100.0%           100.0%            100.0%
Cost of goods sold                  67.8%            69.4%             69.5%
                                   ------           ------            ------
  Gross profit                      32.2%            30.6%             30.5%
Selling, general and 
  administrative expenses           18.1%            18.0%             17.7%
                                   ------           ------            ------
  Operating income                  14.2%            12.6%             12.9%
Interest expense                     0.3%             0.3%              0.2%
Interest income                     (0.1%)           (0.1%)            (0.1%)
                                   ------           ------            ------
Income before provision
  for income taxes                  14.0%            12.4%             12.7%
Provision for income taxes           5.3%             4.5%              4.6%
                                   ------           ------            ------ 
  Net income                         8.8%             7.8%              8.1%
                                   ======           ======            ======
                                       Totals may not agree due to rounding.

                                  -14-
<PAGE> 15

GENERAL

  The following discussion provides information and analysis of the Company's 
results of operations from 1995 through 1997 and its liquidity and capital 
resources.  The following discussion and analysis should be read in 
conjunction with the Company's Consolidated Financial Statements included 
elsewhere herein.

  The Company has achieved compound annual growth rates of 32.8% for total 
revenues and 39.4% for operating income from 1995 to 1997.  Total revenues and 
operating income in 1997 increased 34.2% and 51.0%, respectively, over 1996.

  The Company believes that it has achieved this growth by enhancing the brand 
equity of each of its labels and successfully adding new labels, such as Lauren 
by Ralph Lauren, through its focus on exceptional design, quality and value.  
The Company has leveraged the strength of its brands to increase both the 
number of locations and amount of selling space in which its products are 
offered, as well as to introduce new product extensions.  The Company has 
also benefitted from a trend among its major retail accounts to concentrate 
their women's apparel buying among a narrowing group of apparel vendors.


RESULTS OF OPERATIONS
1997 Compared to 1996

Net Sales
  Net sales in 1997 increased 34.4%, or $0.4 billion, to $1.4 billion compared 
to $1.0 billion in 1996, due primarily to an increase in the number of units 
shipped, and also, to a lesser extent, higher average selling prices per 
unit.  Career sportswear sales increased 15.9%, or $83.9 million, to $612.8 
million in 1997 compared to $528.9 million in 1996.  Casual sportswear sales 
in 1997 increased 10.8%, or $31.5 million, to $323.4 million compared to 
$291.9 million in 1996.  Lifestyle collection sales in 1997 increased $234.1 
million, to $292.9 million compared to $58.8 million in 1996, largely the 
result of the rapid growth in sales of the Lauren by Ralph Lauren label.  
Net sales for the Company's suit, dress and other category increased 1.4%, or 
$2.0 million, to $143.4 million in 1997, compared to $141.4 million in 1996.

Licensing Income
  Licensing income increased $2.0 million to $15.0 million in 1997, compared to 
$13.0 million in 1996.  Income from licenses under the Jones New York label 
increased $1.8 million while income from licenses under the Evan-Picone label 
rose $0.2 million.  The increases were primarily due to higher sales volume by 
licensees.

Gross Profit
  The gross profit margin was 32.2% in 1997, compared to 30.6% in 1996.  The 
increase was attributable to the impact of stronger margins across major product
categories and the proportionately larger increase in sales of the Lauren by 
Ralph Lauren label, which was introduced in Fall 1996 and carries higher margins
than the corporate average.

SG&A Expenses
  Selling, general and administrative expenses ("SG&A" expenses) of $250.7 
million in 1997 represented an increase of $64.1 million over $186.6 million 
in 1996.  As a percentage of total revenues, SG&A expenses increased to 18.1% in
1997 from 18.0% in 1996.  Expenses associated with Lauren by Ralph Lauren 
product advertising, royalties, store displays and associated operating costs, 
as well as the Company's overall sales growth, added significant expenses during
1997.  Retail store operating expenses increased $6.9 million, reflecting the
added cost of 19 new stores in operation at the end of 1997.

                                   -15-
<PAGE> 16

Operating Income
  The resulting 1997 operating income increased $66.3 million to $196.6 million,
compared to $130.3 million during 1996.  The operating margin increased to 14.2%
in 1997 from 12.6% in 1996 as a result of the higher gross profit margins 
during 1997.

Net Interest Expense
  Net interest expense was $2.0 million in 1997 compared to $2.5 million in 
1996.  The primary reason for the change was an increase in interest income
of $1.0 million, which offset higher interest on capital leases for 
additional warehouse facilities constructed during 1997.

Provision for Income Taxes
  The effective income tax rate for 1997 was 37.5% compared to 36.7% in 1996.  
The increase was primarily due to higher state income tax provisions for 1997.

Net Income
  Net income increased 50.5% to $121.7 million in 1997, an increase of $40.8 
million over the net income of $80.9 million earned in 1996.  Net income as a
percentage of total revenues was 8.8% in 1997 compared to 7.8% in 1996.

1996 Compared to 1995

Net Sales
  Net sales in 1996 increased 31.5%, or $244.6 million, to $1,021.0 million, 
compared to $776.4 million in 1995, due primarily to an increase in the number 
of units shipped.  Career sportswear sales increased 20.5%, or $89.8 million,
to $528.9 million in 1996 compared to $439.1 million in 1995.  Casual 
sportswear sales in 1996 increased 39.7%, or $83.0 million, to $291.9 million
compared to $208.9 million in 1995.  Lifestyle collection sales in 1996 
increased $56.7 million to $58.8 million, compared to $2.1 million in 1995, 
primarily due to the 1996 introduction of the Lauren by Ralph Lauren label.  
Net sales for the Company's suit, dress and other category increased 12.0%, 
or $15.1 million, to $141.4 million in 1996 compared to $126.3 million in 1995.

Licensing Income
  Licensing income increased $2.7 million to $13.0 million in 1996 as compared 
to $10.3 million in 1995. Income from licenses under the Jones New York label
increased $2.1 million, while income from licenses under the Evan-Picone 
label rose $0.6 million. 

Gross Profit
   The gross profit margin was 30.6% in 1996 compared to 30.5% in 1995.  The 
increase was primarily attributable to the impact of higher gross profit margins
from the Company's major product lines, as well as the introduction of the 
new Lauren by Ralph Lauren label, which carries higher margins than the 
corporate average.

SG&A Expenses
  SG&A expenses of $186.6 million in 1996 represented an increase of $47.5 
million over $139.1 million in 1995.  As a percentage of total revenues, SG&A
expenses increased to 18.0% in 1996 from 17.7% in 1995.  Expenses associated
with the Lauren by Ralph Lauren product advertising and royalties and associated
operating costs, as well as the Company's overall sales growth, added 
significant expenses during 1996.  Retail store operating expenses increased 
$10.2 million, reflecting the added cost of 25 new stores in operation at the
end of 1996.

                                   -16-
<PAGE> 17

Operating Income
  The resulting 1996 operating income of $130.3 million increased $29.2 million,
as compared to $101.1 million during 1995.  The operating margin decreased to
12.6% in 1996 from 12.9% in 1995, largely as a result of the higher 
percentage of SG&A expenses to sales during 1996. 

Net Interest Expense
  Net interest expense was $2.5 million in 1996 compared to $1.5 million in 
1995.  The primary reasons for the change were higher average overall 
borrowings and interest on capital leases for additional warehouse facilities
during 1996.

Provision for Income Taxes
  The effective income tax rate for 1996 was 36.7% as compared to 36.3% in 1995.
The increase was primarily due to higher state income tax provisions for 1996.

Net Income
  Net income increased 27.4% to $80.9 million in 1996, an increase of $17.4 
million over the net income of $63.5 million earned in 1995.  Net income as a
percentage of total revenues was 7.8% in 1996, compared to 8.1% in 1995.


LIQUIDITY AND CAPITAL RESOURCES

  The Company's principal capital requirements have been to fund working capital
needs, capital expenditures and, beginning in 1995, to repurchase the Company's 
Common Stock on the open market.  The Company has historically relied primarily
on internally generated funds, trade credit and bank borrowings to finance 
its operations and expansion.  As of December 31, 1997, total cash and cash 
equivalents were $40.1 million, a $10.0 million increase over the $30.1 million
reported as of December 31, 1996.

  Net cash provided by operations was $110.6 million, $70.7 million and $8.9 
million in 1997, 1996 and 1995, respectively.  The $39.9 million improvement for
1997 was primarily due to a higher net income and a decrease in trade 
receivables compared to an increase in the previous two years.  While fourth 
quarter 1997 sales increased 33.7% over 1996, accounts receivable at the end of
1997 decreased $18.9 million from 1996.  This was due to the provision for 
allowances that will be granted to customers and fourth quarter shipments 
occurring earlier than in prior years, allowing cash collections on a greater
portion of the resulting receivables before the end of the year.  Inventories
increased $41.0 million in 1997, $37.8 million in 1996 and $53.1 million in 
1995, all of which reflected the inventory levels required to meet anticipated
wholesale shipments for the first quarter of the following year and the net
addition of 19 retail stores in 1997, 25 in 1996, and 42 in 1995.

  Net cash used in investing activities increased to $43.3 million, an increase
of $8.0 million over 1996.  Cash used in investing activities has been 
primarily for the opening of additional warehouse facilities (including, in 
1997, cash restricted for use in completing warehouse facilities under 
construction at the end of the year), new retail stores and existing store 
renovations, computer system hardware and software upgrades and a
$1.5 million payment made in 1996 to satisfy all future royalty obligations to 
the former owner of the Evan-Picone trademark.  In addition, to support 
anticipated growth in the number of units shipped, the Company has committed 
to the construction of additional warehouse facilities in 1998.  These 
facilities, including related equipment, are estimated to cost $28.0 million 
and the Company plans to finance all or a portion of the construction through 
capital lease financing and long-term debt. 

  Net cash provided by (used in) financing activities was $(57.2) million in 
1997, $(22.2) million in 1996 and $2.4 million in 1995.  The principal 
reasons for the changes were: (i) $10.0 and $5.0 million in proceeds from
capital leases in 1997 and 1996, respectively, for construction of additional
warehouse facilities; (ii) issuance of $10.0 million in long-term debt in 
1997 for construction of an additional warehouse facility; and (iii)

                                   -17-
<PAGE> 18

transactions involving the Company's Common Stock.  In 1997 and 1996, the 
Company repurchased $85.8 million and $33.6 million, respectively, of its 
Common Stock on the open market under two announced programs under which the
Company is authorized to acquire an aggregate of up to $200.0 million of such
shares.  As of December 31, 1997, $100.0 million had been expended pursuant to
the first stock repurchase program (the maximum authorized) and an additional
$24.0 million had been expended under the second program.  Proceeds from the
issuance of common stock to employees exercising stock options amounted to 
$12.5 million, $9.1 million and $4.7 million in 1997, 1996 and 1995, 
respectively.

  As of December 31, 1997, the Company had credit arrangements with six United 
States financial institutions which totaled $425.0 million (see Note 5 of 
Notes to Consolidated Financial Statements).  These lines, which may be used 
for unsecured borrowings and letters of credit (issued primarily to finance 
foreign inventory purchases), contain an aggregate sub-limit of $170.0 
million for unsecured borrowings with rates depending on the borrowing 
vehicle utilized.  At December 31, 1997, $153.7 million was utilized for letters
of credit and there were no short-term borrowings outstanding.  The Company also
has a line of credit with a Canadian institution for C$4.0 million to be used
for unsecured borrowings under which no amounts were outstanding at December
31, 1997.

  The Company believes that funds generated by operations and the bank credit
arrangements will provide the financial resources sufficient to meet its
foreseeable working capital, letter of credit, capital expenditure and stock
repurchase requirements.


THE YEAR 2000

  The Company is currently evaluating the impact of the Year 2000 on its 
management and information systems.  At this time, management believes that
the impact of the Year 2000 will have no material effect on its operations or
financial results.


INFLATION

  The Company believes that the relatively moderate rates of inflation which 
have been experienced in the United States and Canada, where it competes, have 
not had a significant effect on its net sales or profitability.


SEASONALITY OF BUSINESS

  Historically, the Company's sales and profit levels fluctuate by quarter.  
As a result, the Company experiences seasonal increases and decreases in its 
working capital requirements.  These patterns result primarily from the 
timing of shipments for each season; however, the timing of seasonal shipments 
can vary from quarter to quarter.  Fall merchandise is shipped principally in 
the third quarter while Spring merchandise is shipped primarily in the first 
quarter.  Summer and Holiday/Resort goods, the smaller of the seasons, are 
shipped primarily in the second and fourth quarters, respectively.  For an 
analysis of quarterly historical operating trends, see Note 14 of Notes to 
Consolidated Financial Statements.

NEW ACCOUNTING STANDARDS

  In 1997, the Financial Accounting Standards Board issued two new disclosure 
standards.  

  Statement of Financial Accounting Standards No. 130, "Reporting Comprehensive
Income," established standards for reporting and display of comprehensive
income, its components and accumulated balances.  Comprehensive income is 
defined to include all changes in equity except those resulting from 
investments 
 
                                   -18-
<PAGE> 19

by owners and distributions to owners.  Among other disclosures, SFAS No. 130
requires that all items that are required to be recognized under current 
accounting standards as components of comprehensive income be reported in a 
financial statement that is displayed with the same prominence as other 
financial statements.  

  Statement of Financial Accounting Standards No. 131, "Disclosures about 
Segments of an Enterprise and Related Information," which supersedes SFAS No.
14, "Financial Reporting for Segments of a Business Enterprise," establishes 
standards for the way that public enterprises report information about 
operating segments in annual financial statements and requires reporting of 
selected information about operating segments in interim financial statements
issued to the public. It also establishes standards for disclosures regarding
products and services, geographic areas and major customers.  SFAS No. 131 
defines operating segments as components of and enterprise about which separate
financial information is available that is evaluated regularly by Management in 
deciding how to allocate resources and in assessing performance.  

  Both SFAS Nos. 130 and 131 are effective for financial statements for periods
beginning after December 15, 1997 and require comparative information for 
earlier years to be restated.  The adoption of these standards is not 
expected to have a material effect on the Company's financial position or 
results of operations. The Company is currently reviewing SFAS No. 131 and 
has of yet been unable to fully evaluate the impact, if any, it may have on
future financial statement disclosures.


STATEMENT REGARDING FORWARD-LOOKING DISCLOSURE

  This Report includes "forward-looking statements" within the meaning of 
Section 27A of the Securities Act of 1933, as amended and Section 21E of the
Securities Exchange Act of 1934, as amended which represent the Company's
expectations or beliefs concerning future events that involve risks and 
uncertainties, including those associated with the effect of national and
regional economic conditions, the overall level of consumer spending, the 
performance of the Company's products within the prevailing retail environment,
customer acceptance of both new designs and newly-introduced product lines, and 
financial difficulties encountered by customers.  All statements other than 
statements of historical facts included in this Annual Report, including, 
without limitation, the statements under "Management's Discussion and Analysis 
of Financial Condition," are forward-looking statements.  Although the Company 
believes that the expectations reflected in such forward-looking statements 
are reasonable, it can give no assurance that such expectations will prove to
have been correct.  Important factors that could cause actual results to differ 
materially from the Company's expectations ("Cautionary Statements") are 
disclosed in this Report.  All subsequent written and oral forward-looking 
statements attributable to the Company or persons acting on its behalf are 
expressly qualified in their entirety by the Cautionary Statements.


ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

STATEMENT OF MANAGEMENT RESPONSIBILITY

  The management of Jones Apparel Group, Inc. is responsible for the 
preparation, integrity and objectivity of the consolidated financial 
statements and other financial information presented in this report.  The 
accompanying consolidated financial statements have been prepared in conformity 
with generally accepted accounting principles and properly reflect the 
effects of certain estimates and judgements made by management.

  The Company's management maintains an effective system of internal control 
that is designed to provide reasonable assurance that assets are safeguarded
and transactions are properly recorded and executed in accordance with 
management's authorization.  The system is continuously monitored by direct 
management

                                   -19-
<PAGE> 20

review, the independent accountants and by internal auditors who conduct an 
extensive program of audits throughout the Company.

  The Company's consolidated financial statements have been audited by BDO 
Seidman, LLP, independent accountants.  Their audits were conducted in 
accordance with generally accepted auditing standards, and included a review 
of financial controls and tests of accounting records and procedures as they 
considered necessary in the circumstances.

  The Audit Committee of the Board of Directors, which consists of outside 
directors, meets regularly with management, the internal auditors and the 
independent accountants to review accounting, reporting, auditing and 
internal control matters.  The committee has direct and private access to both 
internal and external auditors.

/s/ Sidney Kimmel       /s/ Wesley R. Card

Sidney Kimmel           Wesley R. Card
Chairman                Chief Financial Officer



REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To the Board of Directors and Stockholders of Jones Apparel Group, Inc.

  We have audited the accompanying consolidated balance sheets of Jones Apparel 
Group, Inc. and subsidiaries as of December 31, 1997 and 1996, and the related 
consolidated statements of income, stockholders' equity and cash flows for 
each of the three years in the period ended December 31, 1997.  These 
financial statements are the responsibility of the Company's management.  Our 
responsibility is to express an opinion on these financial statements based 
on our audits.

  We conducted our audits in accordance with generally accepted auditing 
standards.  Those standards require that we plan and perform the audits to 
obtain reasonable assurance about whether the financial statements are free 
of material misstatement.  An audit includes examining, on a test basis, 
evidence supporting the amounts and disclosures in the financial statements.  
An audit also includes assessing the accounting principles used and 
significant estimates made by management, as well as evaluating the overall
financial statement presentation.  We believe that our audits provide a 
reasonable basis for our opinion.

  In our opinion, the consolidated financial statements referred to above 
present fairly, in all material respects, the financial position of Jones 
Apparel Group, Inc. and subsidiaries as of December 31, 1997 and 1996, and 
the results of their operations and their cash flows for each of the three 
years in the period ended December 31, 1997, in conformity with generally 
accepted accounting principles.


/s/ BDO Seidman, LLP

BDO Seidman, LLP
New York, New York
February 6, 1998

                                 -20-

<PAGE> 21

Jones Apparel Group, Inc.
Consolidated Balance Sheets
(All amounts in thousands except per share data)


December 31,                                           1997             1996
                                                    -------         --------
ASSETS
CURRENT ASSETS:
  Cash and cash equivalents                         $40,134          $30,085
  Accounts receivable, net of allowance 
    of $2,767 and $2,263 for doubtful accounts       91,747          112,678
  Inventories                                       255,055          214,437
  Receivable from and advances to contractors         7,833           11,490
  Prepaid and refundable income taxes                 5,993                -
  Deferred taxes                                     26,269            9,708
  Prepaid expenses and other current assets          13,740           11,432
                                                   --------         --------
    TOTAL CURRENT ASSETS                            440,771          389,830

  PROPERTY, PLANT AND EQUIPMENT, at cost, 
   less accumulated depreciation and amortization    81,934           61,696
  CASH RESTRICTED FOR CAPITAL ADDITIONS              11,193                -
  INTANGIBLES, at cost, less 
    accumulated amortization                         30,604           26,288
  OTHER ASSETS                                       16,265           10,295
                                                   --------         --------
                                                   $580,767         $488,109
                                                   ========         ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
  Current portion of long-term debt and 
    capital lease obligations                        $4,199           $3,067
  Accounts payable                                   90,429           72,569
  Income taxes payable                                    -            8,959
  Accrued expenses and other current liabilities     15,574           11,265
                                                   --------         --------
    TOTAL CURRENT LIABILITIES                       110,202           95,860
                                                   --------         --------

NONCURRENT LIABILITIES:
  Obligations under capital leases                   18,457           12,134
  Long-term debt                                      8,833                7
  Other                                               6,107                -
                                                   --------         --------
  TOTAL NONCURRENT LIABILITIES                       33,397           12,141
                                                   --------         -------- 

  TOTAL LIABILITIES                                 143,599          108,001
                                                   --------         --------   
COMMITMENTS AND CONTINGENCIES                             -                -

EXCESS OF NET ASSETS ACQUIRED OVER COST               1,536            3,379

STOCKHOLDERS' EQUITY:
  Preferred stock, $.01 par value - shares 
    authorized 1,000; none issued                         -                -
  Common stock, $.01 par value - shares 
    authorized 100,000;issued 54,478 and 53,595         545              536
  Additional paid-in capital                        122,582           99,140
  Retained earnings                                 438,917          317,192
  Cumulative foreign currency 
    translation adjustment                           (1,524)          (1,154)
                                                   --------         --------
                                                    560,520          415,714
  Less treasury stock, 
   3,384 and 1,600 shares, at cost                 (124,888)         (38,985)
                                                   --------         --------
    TOTAL STOCKHOLDERS' EQUITY                      435,632          376,729
                                                   --------         --------   
                                                   $580,767         $488,109
                                                   ========         ========

See accompanying notes to consolidated financial statements

                                   -21- 
<PAGE> 22

Jones Apparel Group, Inc.
Consolidated Statements of Income
(All amounts in thousands except per share data)

<TABLE>
<CAPTION>

Year Ended December 31,                    1997              1996            1995
                                     ----------        ----------        --------
<S>                                  <C>               <C>               <C>
NET SALES                            $1,372,458        $1,021,042        $776,365
LICENSING INCOME                         15,013            13,036          10,314
                                     ----------        ----------        --------  
  Total revenues                      1,387,471         1,034,078         786,679

COST OF GOODS SOLD                      940,149           717,250         546,413
                                     ----------        ----------        -------- 
  Gross profit                          447,322           316,828         240,266

SELLING, GENERAL AND ADMINISTRATIVE 
  EXPENSES                              250,685           186,572         139,135
                                     ----------        ----------        --------                                     
  Operating income                      196,637           130,256         101,131

INTEREST EXPENSE                          3,584             3,040           1,908
INTEREST INCOME                          (1,556)             (547)           (445)
                                     ----------        ----------        --------                                  
  Income before provision for 
    income taxes                        194,609           127,763          99,668

PROVISION FOR INCOME TAXES               72,884            46,889          36,183
                                     ----------        ----------        --------
NET INCOME                             $121,725           $80,874         $63,485
                                     ==========        ==========        ========
EARNINGS PER SHARE
  Basic                                   $2.35             $1.55           $1.22
  Diluted                                 $2.26             $1.51           $1.20

WEIGHTED AVERAGE COMMON 
    SHARES OUTSTANDING
  Basic                                  51,899            52,333          52,130
  Diluted                                53,905            53,651          53,024

</TABLE>

See accompanying notes to consolidated financial statements

                                   -22-
<PAGE> 23

Jones Apparel Group, Inc.
Consolidated Statements of Stockholders' Equity
(All amounts in thousands)
        
<TABLE>
CAPTION>
                                                                 Cumulative
                                                                    foreign                   Total                                
                                          Additional               currency                  Stock-
                                 Common      paid-in   Retained translation    Treasury    holders'
                                  stock      capital   earnings adjustments       stock      equity
                                   ----     --------   --------     -------    ---------   -------- 
<S>                                <C>      <C>        <C>          <C>        <C>         <C>                
BALANCE, JANUARY 1, 1995           $259      $76,711   $172,916     $(1,208)   $       -   $248,678

YEAR ENDED DECEMBER 31, 1995:
  Amortization of deferred 
    compensation in connection 
    with executive stock options      -          232          -           -            -        232
  Net income                          -            -     63,485           -            -     63,485
  Exercise of stock options           4        4,730        (83)          -          168      4,819
  Tax benefit derived from 
    exercise of stock options         -        2,499          -           -            -      2,499
  Stock tendered as payment for
    options exercised                 -            -          -           -         (168)      (168)
  Treasury stock acquired             -            -          -           -       (4,638)    (4,638)
  Foreign currency translation 
    adjustments                       -            -          -          68            -         68
                                    ---     --------   --------     -------      -------   --------      
BALANCE, DECEMBER 31, 1995          263       84,172    236,318      (1,140)      (4,638)   314,975

YEAR ENDED DECEMBER 31, 1996:
  Amortization of deferred 
    compensation in connection 
    with executive stock options      -          290          -           -            -        290
  Net income                          -            -     80,874           -            -     80,874
  Exercise of stock options           6        9,825          -           -            -      9,831
  Tax benefit derived from 
    exercise of stock options         -        5,157          -           -            -      5,157
  Stock tendered as payment 
    for options exercised             -            -          -           -         (763)      (763)
  Treasury stock acquired             -            -          -           -      (33,584)   (33,584)
  Effect of 2-for-1 stock split     267         (267)         -           -            -          -
  Registration of 1996 
    Stock Option Plan                 -          (37)         -           -            -        (37)
  Foreign currency translation 
    adjustments                       -            -          -         (14)           -        (14)
                                    ---     --------   --------     -------     --------   --------
BALANCE, DECEMBER 31, 1996          536       99,140    317,192      (1,154)     (38,985)   376,729

YEAR ENDED DECEMBER 31, 1997:
  Amortization of deferred
    compensation in connection
    with executive stock options
    and related items                 -        2,778          -           -            -      2,778
  Net income                          -            -    121,725           -            -    121,725
  Exercise of stock options           9       12,597          -           -            -     12,606
  Tax benefit derived from 
    exercise of stock options         -        8,067          -           -            -      8,067
  Stock tendered as payment 
    for options exercised             -            -          -           -         (100)      (100)
  Treasury stock acquired             -            -          -           -      (85,803)   (85,803)
  Foreign currency translation 
    adjustments                       -            -          -        (370)           -       (370)
                                   ----     --------   --------     -------    ---------   -------- 
BALANCE, DECEMBER 31, 1997         $545     $122,582   $438,917     $(1,524)   $(124,888)  $435,632
                                   ====     ========   ========     =======    =========   ======== 
</TABLE>

See accompanying notes to consolidated financial statements

                                   -23-
<PAGE> 24

Jones Apparel Group, Inc.
Consolidated Statements of Cash Flows
(All amounts in thousands)


Year Ended December 31,                       1997       1996        1995
                                          --------    -------     -------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                $121,725    $80,874     $63,485
                                          --------    -------     -------       
Adjustments to reconcile net income 
  to net cash provided by operating 
  activities:
   Depreciation and amortization            14,594      8,948       6,724
   Provision for losses on 
     trade receivables                       1,870        800        (464)
   Deferred taxes                          (17,907)     7,233       7,622
   Other                                       264        416          40

Decrease (increase) in:
   Trade receivables                        18,917    (21,349)    (17,873)
   Inventories                             (40,961)   (37,814)    (53,077)
   Prepaid expenses and 
     other current assets                    1,264     10,624     (10,746)
   Other assets                             (6,273)    (3,703)     (5,027)

Increase (decrease) in:
   Accounts payable                         17,909     13,498      13,371
   Taxes payable                            (5,253)     6,673       4,116
   Accrued expenses and other 
     current liabilities                     4,428      4,492         768
                                          --------    -------     -------
     Total adjustments                     (11,148)   (10,182)    (54,546)
                                          --------    -------     -------
     Net cash provided by 
      operating activities                 110,577     70,692       8,939
                                          --------    -------     -------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Capital expenditures                    (32,149)   (34,066)    (16,013)
   Proceeds from disposition of assets           -        261         635
   Increase in cash restricted 
     for capital additions                 (11,193)         -           -
   Acquisition of trademarks and licenses        -     (1,492)        (28)
                                          --------    -------     -------
     Net cash used in investing activities (43,342)   (35,297)    (15,406)
                                          --------    -------     ------- 
CASH FLOWS FROM FINANCING ACTIVITIES:
   Principal payments on long-term 
     debt and capital leases                (3,939)    (2,623)     (2,606)
   Purchases of treasury stock             (85,803)   (33,584)     (4,638)
   Proceeds from issuance of 
     long-term debt                         10,000          -           -
   Proceeds from capital leases             10,000      5,000       5,000
   Proceeds from exercise of stock options  12,507      9,068       4,651
   Other                                         -        (37)          -

     Net cash provided by (used in)       --------    -------     -------
      financing activities                 (57,235)   (22,176)      2,407
                                          --------    -------     -------      
EFFECT OF EXCHANGE RATES ON CASH                49          2        (202)
                                          --------    -------     -------
NET INCREASE (DECREASE) IN CASH AND
  CASH EQUIVALENTS                          10,049     13,221      (4,262)

CASH AND CASH EQUIVALENTS, BEGINNING        30,085     16,864      21,126
                                          --------    -------     -------
CASH AND CASH EQUIVALENTS, ENDING          $40,134    $30,085     $16,864
                                          ========    =======     =======

See accompanying notes to consolidated financial statements

                                   -24-
<PAGE> 25

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements


NOTE 1.  SUMMARY OF ACCOUNTING POLICIES

Basis of Presentation
  The consolidated financial statements include the accounts of Jones Apparel 
Group, Inc. and its wholly-owned subsidiaries (collectively, the "Company").  
All significant intercompany balances and transactions have been eliminated.

  The Company designs, contracts for the manufacture of, and markets a broad 
range of women's career and casual sportswear, suits and dresses.  The 
Company sells its products to better specialty and department stores and also
operates its own network of factory outlet stores.  In addition, the Company 
licenses the use of several of its brand names to select manufacturers of 
women's and men's apparel and accessories.

  The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of 
contingent assets and liabilities at the date of the financial statements and 
the reported amounts of revenues and expenses during the reporting period.  
Actual results could differ from these estimates.

Credit Risk
  Financial instruments which potentially subject the Company to concentration
of credit risk consist principally of temporary cash, cash equivalents and 
accounts receivable.  The Company places its cash and cash equivalents in 
investment-grade, short-term debt instruments with quality financial 
institutions and the U.S. Government and, by policy, limits the amount of 
credit exposure in any one financial vehicle.  The Company performs ongoing 
credit evaluations of its customers' financial condition and, generally, 
requires no collateral from its customers.  The allowance for non-collection
of accounts receivable is based upon the expected collectibility of all 
accounts receivable.

Financial Instruments
  The fair value of cash and cash equivalents and receivables approximate their
carrying value due to their short-term maturities.  The fair value of 
long-term debt instruments, including the current portion, approximates the 
carrying value and is estimated based on the current rates offered to the 
Company for debt of similar maturities.

Inventories
  Inventories are stated at the lower of cost or market.  Wholesale inventories
are determined using the first-in, first-out method while retail inventories
are determined using the retail method. 

Property, Plant, Equipment and Depreciation
  Depreciation and amortization are computed by the straight-line method over 
the estimated useful lives of the assets ranging from three to twenty years.

Leased Property Under Capital Leases
  Property under capital leases is amortized over the lives of the respective
leases or the estimated useful lives of the assets.

Intangibles
  Intangibles, which include trademarks and license agreements, are amortized on
a straight-line basis over the estimated useful lives of the assets.

                                   -25-
<PAGE> 26

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements (Continued)


Excess of Net Assets Acquired Over Cost
  The excess of net assets acquired over cost of acquired businesses is 
amortized using the straight-line method over a five year period.

Foreign Currency Translation
  The financial statements of foreign subsidiaries are translated into U.S. 
dollars in accordance with Statement of Financial Accounting Standards 
No. 52, "Foreign Currency Translations."  Balance sheet accounts are 
translated at the current exchange rate and income statement items are 
translated at the average exchange rate for the period.  Gains and losses 
resulting from translation are accumulated in a separate component of 
stockholders' equity.  Segment data is not provided as foreign operations are 
not material.

Treasury Stock
  Treasury stock is recorded at net acquisition cost.  Gains and losses on 
disposition are recorded as increases or decreases to additional paid-in 
capital with losses in excess of previously recorded gains charged directly 
to retained earnings.

Revenue Recognition
  Sales are recognized upon shipment of products or, in the case of retail 
sales, at the time of register receipt.  Allowances for estimated returns are
provided when sales are recorded.

Income Taxes
  The Company uses the asset and liability method of accounting for income 
taxes.  Current tax assets and liabilities are recognized for the estimated 
Federal, foreign, state and local income taxes payable or refundable on the 
tax returns for the current year.  Deferred tax assets and liabilities are 
recognized for the expected future tax consequences of temporary timing 
differences between the financial statement and tax bases of assets and 
liabilities using enacted tax rates in effect for the year in which the 
differences are expected to reverse.  Deferred income tax provisions are based 
on the changes to the respective assets and liabilities from period to period.

Stock Options
  The Company uses the intrinsic value method of accounting for employee stock 
options as permitted by Statement of Financial Accounting Standards No. 123, 
"Accounting for Stock-Based Compensation."  Accordingly, compensation cost for
stock options is measured as the excess, if any, of the quoted market price 
of the Company's stock at the date of the grant over the amount the employee
must pay to acquire the stock.  The compensation cost is recognized over the
vesting period of the options.

Earnings per Share
  During 1997, the Financial Accounting Standards Board issued Statement of 
Financial Accounting Standards No. 128, "Earnings per Share," which provides
for the calculation of "basic" and "diluted" earnings per share.  This 
Statement, effective for financial statements issued for periods ending after
December 15, 1997, requires restatement of all prior-period EPS data 
presented.  Basic earnings per share includes no dilution and is computed by
dividing income available to common shareholders by the weighted average 
number of common shares outstanding for the period.  Diluted earnings per share 
reflect, in periods in which they have a dilutive effect, the effect of 
common shares issuable upon exercise of stock options.  All periods
presented have been restated to comply with the provisions of SFAS No. 128.

Cash Equivalents
  The Company considers all highly liquid short-term investments to be cash 
equivalents.

                                   -26-
<PAGE> 27

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements (Continued)


Long-Lived Assets
  The Company reviews certain long-lived assets and identifiable intangibles for
impairment whenever events or changes in circumstances indicate that the 
carrying amount may not be recoverable.  In that regard, the Company assesses
the recoverability of such assets based upon estimated non-discounted cash flow
forecasts.

Presentation of Prior Year Data
  Certain reclassifications have been made to conform prior year data with the 
current presentation.

New Accounting Standards     
  Statement of Financial Accounting Standards No. 130, "Reporting Comprehensive
Income," established standards for reporting and display of comprehensive 
income, its components and accumulated balances.  Comprehensive income is 
defined to include all changes in equity except those resulting from 
investments by owners and distributions to owners.  Among other disclosures, 
SFAS No. 130 requires that all items that are required to be recognized under 
current accounting standards as components of comprehensive income be 
reported in a financial statement that is displayed with the same prominence as 
other financial statements. 

  Statement of Financial Accounting Standards No. 131, "Disclosures about 
Segments of an Enterprise and Related Information," which supersedes SFAS 
No. 14, "Financial Reporting for Segments of a Business Enterprise," 
establishes standards for the way that public enterprises report information 
about operating segments in annual financial statements and requires 
reporting of selected information about operating segments in interim 
financial statements issued to the public. It also establishes standards for 
disclosures regarding products and services, geographic areas and major 
customers.  SFAS No. 131 defines operating segments as components of and 
enterprise about which separate financial information is available that is 
evaluated regularly by Management in deciding how to allocate resources and in 
assessing performance.  

  Both SFAS Nos. 130 and 131 are effective for financial statements for periods
beginning after December 15, 1997 and require comparative information for 
earlier years to be restated.  The adoption of these standards is not 
expected to have a material effect on the Company's financial position or 
results of operations.  The Company is currently reviewing SFAS No. 131 and 
has of yet been unable to fully evaluate the impact, if any, it may have on 
future financial statement disclosures. 



NOTE 2.  INVENTORIES

Inventories are summarized as follows:
              
  December 31,                                            1997            1996
  (In thousands)                                      --------        --------
  Raw materials                                        $27,045         $38,571
  Work in process                                       41,294          37,682
  Finished goods                                       186,716         138,184
                                                      --------        --------
                                                      $255,055        $214,437
                                                      ========        ========

                                   -27-
<PAGE> 28

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements (Continued)


NOTE 3.  PROPERTY, PLANT AND EQUIPMENT
    
  Major classes of property, plant and equipment are as follows:

  December 31,                                            1997            1996
  (In thousands)                                       -------         -------
  Land and buildings                                   $37,893         $36,763
  Leasehold improvements                                29,230          24,712
  Machinery and equipment                               31,979          25,340
  Furniture and fixtures                                 9,666           6,932
  Construction in progress                              17,355           1,076
                                                       -------         -------
                                                       126,123          94,823
  Less: accumulated depreciation and amortization       44,189          33,127
                                                       -------         -------
                                                       $81,934         $61,696
                                                       =======         =======

  Included in property, plant and equipment are the following capitalized 
leases:

  December 31,                                            1997            1996
  (In thousands)                                       -------         -------
  Buildings                                            $32,137         $31,006
  Machinery and equipment                                3,759           3,538
  Construction in progress                               9,937               -
                                                       -------         -------
                                                        45,833          34,544
  Less: accumulated amortization                        12,626          10,243
                                                       -------         -------
                                                       $33,207         $24,301
                                                       =======         =======

  At December 31, 1997, the Company had commitments to construct additional 
warehouse facilities.  These facilities, which will be completed during 1998, 
will cost an estimated $28,000,000 in the aggregate.  As of December 31, 
1997, a total of $9,937,000 had been expended on these projects and the Company 
had $11,193,000 in cash on hand restricted for use in their completion.

                                   -28-
<PAGE> 29

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements (Continued)


NOTE 4.  INTANGIBLE ASSETS

  Intangible assets consist of the following:
                                                                       Useful
                                                                        lives
  December 31,                                1997        1996        (years)
  (In thousands)                           -------     -------     ----------
    
  Trademarks                               $32,972     $26,865       15 to 20
  License agreements                         5,319       5,319     51/2 to 19
                                           -------     -------
                                            38,291      32,184

  Less: accumulated amortization             7,687       5,896
                                           -------     -------
                                           $30,604     $26,288
                                           =======     =======

NOTE 5.  SHORT-TERM BORROWINGS

  At December 31, 1997, the Company had credit arrangements with six United 
States financial institutions which totaled $425,000,000.  These lines, which
may be used for unsecured borrowings and letters of credit (issued primarily 
to finance foreign inventory purchases), contain an aggregate sub-limit of 
$170,000,000 for unsecured borrowings with rates depending on the borrowing 
vehicle utilized.  At December 31, 1997, the estimated aggregate interest 
rate on the lines was 7.1%.  The Company was committed for unexpired bank 
letters of credit at December 31, 1997 in the amount of $153,744,000 and there 
were no short-term borrowings outstanding.  The Company also has a line of 
credit with a Canadian institution for C$4,000,000 to be used for unsecured 
borrowings under which no amounts were outstanding at December 31, 1997.


NOTE 6.  LONG-TERM DEBT

  Long-term debt consists of the following:

  December 31,                                            1997            1996
  (In thousands)                                        ------          ------
 
  7.125% Industrial revenue bonds, due 2007             $9,833          $    -
  Other debt                                                10              48
                                                        ------          ------
                                                         9,843              48
  Less: current portion                                  1,010              41
                                                        ------          ------
                                                        $8,833          $    7
                                                        ======          ======

  During 1997, the Company issued $10.0 million of long-term debt to finance
construction of a new warehouse facility.  The aggregate maturities for 
long-term debt for the five years after December 31, 1997 are approximately 
$1,000,000 per year. 

                                   -29-
<PAGE> 30

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements (Continued)


NOTE 7.  OBLIGATIONS UNDER CAPITAL LEASES

  Obligations under capital leases consist of the following:

  December 31,                                            1997            1996
  (In thousands)                                       -------         -------
  Warehouses, office facilities and equipment          $21,646         $15,160
  Less: current portion                                  3,189           3,026
                                                       -------         -------
  Obligations under capital leases - noncurrent        $18,457         $12,134
                                                       =======         =======

  The Company occupies a warehouse and office facility which is leased from an 
affiliated real estate partnership which is 50% owned by the Company's 
Chairman.  The lease runs until March 15, 1998.  Minimum annual rent payments
are $1,000,000.  The lease was capitalized at the fair market value of the
facility which approximated the present value of the minimum lease payments. 
Upon the expiration of the lease, the Company has agreed to purchase the 
property from the partnership for $10,500,000, which approximates fair market 
value, and enter into a sale and leaseback arrangement with an unrelated third
party.

  The Company occupies warehouse and office facilities leased from the City of 
Lawrenceburg, Tennessee. Four ten-year net leases run until February 2004, 
July 2005, May 2006 and April 2007, respectively, and require minimum annual 
rent payments of $500,000, $500,000, $500,000, and $1,000,000, respectively, 
plus accrued interest.  In connection with these leases, the Company guaranteed 
$25,000,000 of Industrial Development Bonds issued in order to construct the 
facilities, $20,417,000 of which remained unpaid as of December 31, 1997.  
The financing agreement with the issuing authority (i) requires the Company to 
maintain stipulated levels of insurance and tangible net worth, (ii) requires
the Company to maintain minimum ratios of cash flow to debt service and 
liabilities to tangible net worth and (iii) contains certain other restrictions.

  The Company also leases various equipment under three to five year leases at 
an aggregate annual rental of $767,000.  The equipment has been capitalized 
at its fair market value of $2,650,000, which approximates the present value 
of the minimum lease payments. 

  The following is a schedule by year of future minimum lease payments under 
capital leases, together with the present value of the net minimum lease 
payments as of December 31, 1997:

  Year Ending December 31,
  (In thousands)

  1998                                                      $4,638
  1999                                                       4,254
  2000                                                       3,523
  2001                                                       3,345
  2002                                                       3,166
  Later years                                                8,994
                                                           -------
  Total minimum lease payments                              27,920
  Less: amount representing interest                         6,274
                                                           -------
  Present value of net minimum lease payments              $21,646
                                                           =======

                                   -30-
<PAGE> 31

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements (Continued)


NOTE 8.  SIGNIFICANT CUSTOMERS

  A significant portion of the Company's sales are to retailers throughout the 
United States and Canada.  Sales to department stores owned by Federated 
Department Stores, Inc. ("Federated") accounted for 20%, 20% and 21% for the
years ended December 31, 1997, 1996 and 1995, respectively.  Sales to 
department stores owned by The May Department Stores Company ("May") 
accounted for 19%, 20% and 19% for the years ended December 31, 1997, 1996 
and 1995, respectively.  Federated and May accounted for approximately 43%
of accounts receivable at December 31, 1997.


NOTE 9.  COMMITMENTS

  (a) LEASES.  Total rent expense charged to operations for the years ended 
December 31, 1997, 1996 and 1995 was $22,159,000, 18,888,000 and $15,359,000,
respectively.

  The following is a schedule by year of future minimum rental payments required
under operating leases for the next five years:

  Year Ending December 31,
  (In thousands)

  1998                                                      $18,059
  1999                                                       17,320
  2000                                                       15,124
  2001                                                       13,416
  2002                                                        8,506
  Later years                                                17,617
                                                            -------
                                                            $90,042
                                                            =======

  Certain of the leases provide for renewal options and the payment of real 
estate taxes and other occupancy costs.

  (b) CONTINGENT LIABILITIES.  Various lawsuits and claims arising during the 
normal course of business are pending against the Company and its 
consolidated subsidiaries.  In the opinion of management, the ultimate 
liability, if any, resulting from these matters will have no significant effect 
on the Company's consolidated financial position, results of operations or 
liquidity.

  (c) ROYALTIES.  Under an exclusive license to manufacture certain items 
under the Lauren by Ralph Lauren trademark pursuant to license and design 
service agreements with Polo Ralph Lauren Corporation, the Company is 
obligated to pay Polo Ralph Lauren Corporation a percentage of net sales of 
Lauren by Ralph Lauren products.  Under these agreements, minimum payments of
$7,000,000 are due for each of the years 2000 and 2001.  The license and 
design service agreements expire on December 31, 2001 and provide for certain
renewal options at that time.

                                   -31-
<PAGE> 32

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements (Continued)



NOTE 10.  INCOME TAXES

  The following summarizes the provision for income taxes:


  Year ended December 31,             1997              1996              1995
  (In thousands)                   -------           -------           ------- 
     
  Current:
    Federal                        $78,811           $34,522           $23,236
    State and local                 10,524             3,733             3,030
    Foreign                          1,456             1,401             2,295
                                   -------           -------           -------
                                    90,791            39,656            28,561
                                   -------           -------           -------
  Deferred:
    Federal                        (15,359)            7,722             7,653
    State and local                 (2,240)             (489)              (31)
    Foreign                           (308)                -                 -
                                   -------           -------           -------
                                   (17,907)            7,233             7,622
                                   -------           -------           -------
Provision for income taxes         $72,884           $46,889           $36,183
                                   =======           =======           =======
                              
The foreign and domestic components of income before provision for income taxes
were as follows:


  Year ended December 31,             1997              1996              1995
  (In thousands)                  --------          --------           -------

  United States                   $192,482          $125,650           $94,224
  Canada                             1,815             2,378             2,666
  Other                                312              (265)            2,778
                                  --------          --------           -------
  Income before provision 
    for income taxes              $194,609          $127,763           $99,668
                                  ========          ========           =======

                                    -32-
<PAGE> 33

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements (Continued)


  The provision for income taxes on adjusted historical income differs from the 
amounts computed by applying the applicable Federal statutory rates due to 
the following:


  Year ended December 31,             1997              1996              1995
  (In thousands)                   -------          --------           -------

  Provision for Federal income 
    taxes at the statutory rate    $68,113           $44,717           $34,884
  State and local income taxes, 
    net of federal benefit           5,385             2,108             1,949
  Amortization of excess of net 
    assets acquired over cost         (645)             (645)             (645)
  Other items, net                      31               709                (5)
                                   -------           -------           ------- 
  Provision for income taxes       $72,884           $46,889           $36,183
                                   =======           =======           =======


  The Company has not provided for U.S. Federal and foreign withholding taxes on
$2,727,000 of foreign subsidiaries' undistributed earnings as of December 31,
1997.  Such earnings are intended to be reinvested indefinitely.

  The following is a summary of the significant components of the Company's 
deferred tax assets and liabilities: 



  December 31,                                          1997              1996
  (In thousands)                                     -------           -------

  Deferred tax assets:
    Nondeductible accruals and allowances            $23,587           $ 8,009
    Depreciation and amortization                        561             1,118
    Other (net)                                        2,286             1,042
                                                     -------           -------
  Net deferred tax asset                             $26,434           $10,169
                                                     =======           =======

                                  -33-
<PAGE> 34

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements (Continued)


NOTE 11.  COMMON STOCK

  On July 30, 1996, the Company's Board of Directors approved a two-for-one 
stock split of the Company's Common Stock in the form of a 100% stock 
dividend for shareholders of record as of September 12, 1996.  Concurrently, 
the number of authorized shares of Common Stock was increased to 100,000,000.  
On October 2, 1996, a total of 26,744,580 shares of Common Stock were issued 
in connection with the split.  The stated par value of each share remained at
$0.01.  The issuance of authorized but unissued shares resulted in the transfer
of $267,000 from additional paid-in capital to common stock, representing the 
par value of the shares issued.  All share and per share amounts have been 
restated to retroactively reflect the stock split.

  In 1995, the Board of Directors authorized the repurchase of up to 
$100,000,000 of the Company's Common Stock in open market transactions over 
a two-year period ending in December, 1997.  The program expired on October 
27, 1997, through which date 2,823,394 shares had been acquired at a cost of 
$100,000,000.

  In 1997, the Board of Directors authorized an additional program to 
repurchase the Company's Common Stock from time to time in open market 
transactions not to exceed $100,000,000 in aggregate price.  This program was
to commence upon the earlier of December 15, 1997 or the full utilization of 
the previous buy-back program and has no time limit.  As of December 31, 
1997, 530,106 shares had been acquired at a cost of $24,025,000, leaving 
$75,975,000 available for future repurchases at that date.


NOTE 12.  STATEMENT OF CASH FLOWS
                                           
  Cash interest payments during the years ended December 31, 1997, 1996 and 
1995 were $3,941,000, $3,207,000 and $2,118,000, respectively.

  Cash income tax payments during the years ended December 31, 1997, 1996 and 
1995 were $96,251,000, $32,110,000 and $23,068,000, respectively.

  In connection with an agreement entered into for the formal acquisition of and
payment for a currently utilized trademark, the Company recorded a $6,107,000 
intangible asset and an offsetting long-term liability. 

  Reductions in income tax payments resulting from the exercise of employee 
stock options during the years ended December 31, 1997, 1996 and 1995 were 
$8,067,000, $5,157,000 and $2,499,000, respectively. 

  Under the provisions of the Company's 1991 Stock Option Plan, employees 
exercising stock options during the year ended December 31, 1997 exchanged 
2,122 shares of the Company's Common Stock (valued at $100,000) for 8,163 
newly issued shares, during the year ended December 31, 1996 exchanged 28,000 
shares of the Company's Common Stock (valued at $763,000) for 67,430 newly 
issued shares and during the year ended December 31, 1995 exchanged 11,536 
shares of the Company's Common Stock (valued at $168,000) for 24,000 newly 
issued shares.

                                   -34-
<PAGE> 35

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements (Continued)


NOTE 13.  STOCK OPTIONS

  At December 31, 1997, the Company has two stock option plans, which are 
described below.  The Company applies APB Opinion 25, "Accounting for Stock 
Issued to Employees," and related Interpretations in accounting for the 
plans.  Under APB Opinion 25, when the exercise price of the Company's employee
stock options equals the market price of the underlying stock on the date of 
grant, no compensation cost is recognized.

  Under the Company's 1991 and 1996 Stock Option Plans, options to purchase an 
aggregate of not more than 5,000,000 shares and 4,000,000 shares, 
respectively, of common stock may be granted from time to time to key 
employees, officers, directors, advisors and independent consultants to the 
Company or to any of its subsidiaries.  The Plans are administered by the 
Board of Directors, which has empowered a committee of directors to 
administer the Plans.

  Under both plans, the per share exercise price for incentive stock options 
("ISOs") will not be less than 100% of the fair market value of a share of 
the common stock on the date the option is granted (110% of fair market value
on the date of grant of an ISO if the optionee owns more than 10% of the 
Company).  Under the 1991 Plan, the per share exercise price for non-
qualified stock options ("NQSOs") will not be less than 75% of the fair 
market value on the date the option is granted.  The 1996 Plan has no 
restrictions on NQSO pricing.  Under the 1991 Plan, options may be granted 
for a term to be determined by the committee of not less than one or more 
than ten years from the date of grant; under the 1996 Plan, options may be 
granted for a term of not less than six months or more than ten years from 
the date of grant.

  FASB Statement 123, "Accounting for Stock-Based Compensation," requires the 
Company to provide pro forma information regarding net income and earnings 
per share as if compensation cost for the Company's stock option plans had 
been determined in accordance with the fair value-based method prescribed in 
FASB Statement 123.  The Company estimates the fair value of each stock option 
at the grant date by using the Black-Scholes option-pricing model with the 
following weighted-average assumptions used for grants in 1997, 1996 and 
1995, respectively: no dividends paid for all years; expected volatility of 
34.7%,  38.9% and 40.7%; risk-free interest rates of 6.04%, 6.20% and 6.16%; 
and expected lives of 3.4, 3.0 and 3.0 years.

  Under the accounting provisions of FASB Statement 123, the Company's net 
income and earnings per share would have been reduced to the pro forma 
amounts indicated in the following table.


December 31,                          1997              1996              1995
                                  --------           -------           -------
Net income (in thousands)
  As reported                     $121,725           $80,874           $63,485
  Pro forma                        116,120            79,074            63,387

Basic earnings per share
  As reported                        $2.35             $1.55             $1.22
  Pro forma                          $2.24             $1.51             $1.22

Diluted earnings per share
  As reported                        $2.26             $1.51             $1.20
  Pro forma                          $2.15             $1.47             $1.20

                                  -35-
<PAGE> 36

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements (Continued)


  The following table contains information on stock options for the three 
year period ended December 31, 1997:

                                                       Exercise       Weighted
                                    Option          price range        average
                                    shares            per share          price
                                 ---------   ------------------         ------
Outstanding, January 1, 1995     3,726,366     $0.40 to $16.125          $9.65
Granted                            180,000     $12.00 to $17.75         $14.28
Exercised                          777,766      $0.40 to $14.25          $6.20
Forfeited                           78,000     $7.00 to $16.125         $13.63
                                 ---------   ------------------         ------
Outstanding, December 31, 1995   3,050,600      $0.40 to $17.75         $10.71
Granted                          2,166,000   $14.715 to $34.375         $24.53
Exercised                        1,031,230    $0.40 to $14.5625          $9.53
Forfeited                           76,200      $7.00 to $24.00         $14.93
                                 ---------   ------------------         ------
Outstanding, December 31, 1996   4,109,170     $0.40 to $34.375         $18.17
Granted                          1,717,000      $1.00 to $51.50         $47.04
Exercised                          883,118     $7.00 to $36.625         $14.28
Forfeited                           18,800    $12.375 to $24.75         $21.46
                                 ---------   ------------------         ------
Outstanding, December 31, 1997   4,924,252      $0.40 to $51.50         $28.88
                                 =========   ==================         ======
Exercisable at year-end
  1995                             980,400    $0.40 to $15.0625          $8.93
  1996                             733,770      $0.40 to $17.50          $9.56
  1997                             894,854     $0.40 to $34.375         $13.90


                                                      1991 Plan      1996 Plan
                                                      ---------      ---------
Available for future grants                     
  1995                                                  938,334              -
  1996                                                   49,534      2,799,000
  1997                                                    3,134      1,147,200


                            Exercise price       Exercise price          Total
                          less than market      equal to market        options
                          ----------------      ---------------        -------
Weighted-average 
fair value of:
  Options granted in 1995                -                $4.74          $4.74
  Options granted in 1996            $8.46                $8.00          $8.01
  Options granted in 1997           $35.72               $14.90         $15.20

                                    -36-
<PAGE> 37

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements (Continued)


The following table summarizes information about stock options outstanding at 
December 31, 1997.

<TABLE>
<CAPTION>

Range of exercise prices:       $0.40       $11.25      $21.125    $32.625       $44.00        $0.40
                                   to           to           to         to           to           to        
                                $9.50      $19.625     $24.3125     $39.25       $51.50       $51.50
                              -------    ---------    ---------    -------    ---------    ---------
<S>                           <C>        <C>          <C>          <C>        <C>          <C>         
Outstanding Options
  Number outstanding
    at December 31, 1997      361,167    1,044,867    1,579,218    324,000    1,615,000    4,924,252
  Weighted-average remaining
    contractual life (years)      3.4          6.9          8.6        9.0          9.8          8.3
  Weighted-average 
    exercise price              $5.86       $13.55       $23.97     $34.53       $47.61       $28.88

Exercisable options
  Number outstanding
    at December 31, 1997      261,169      373,067      253,618      7,000            -      894,854
  Weighted-average  
    exercise price              $4.61       $13.16       $23.98     $34.38            -       $13.90
</TABLE>


NOTE 14.  UNAUDITED CONSOLIDATED FINANCIAL INFORMATION

  Unaudited interim consolidated financial information for the two years ended 
December 31, 1997 is summarized as follows:

                                        First     Second      Third     Fourth
(In thousands except per share data)  Quarter    Quarter    Quarter    Quarter
                                     --------   --------   --------   --------
1997
  Net sales                          $317,990   $262,988   $445,972   $345,508
  Total revenues                      321,455    266,289    450,508    349,219
  Gross profit                        106,571     87,747    147,201    105,803
  Operating income                     47,475     31,115     79,383     38,664
  Net income                           29,540     19,280     48,938     23,967
  Diluted earnings per share            $0.55      $0.36      $0.90      $0.45

1996
  Net sales                          $260,350   $193,275   $309,019   $258,398
  Total revenues                      262,926    195,934    313,228    261,990
  Gross profit                         75,369     63,691     99,706     78,062
  Operating income                     32,652     21,534     49,788     26,282
  Net income                           20,339     13,338     30,878     16,319
  Diluted earnings per share            $0.38      $0.25      $0.58      $0.30


                                   -37-
<PAGE> 38

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements (Continued)

NOTE 15.  EMPLOYEE BENEFIT PLAN

  The Company maintains the Jones Apparel Group, Inc. Retirement Plan (the 
"Plan") under Section 401(k) of the Internal Revenue Code.  Full-time 
employees not covered by a collective bargaining agreement and meeting 
certain other requirements are eligible to participate in the Plan.  Under the 
Plan, employees may elect to have up to 10% of their salary deferred and 
deposited with a qualified trustee, who in turn invests the money in a 
variety of investment vehicles as selected by each employee.  

  From January 1, 1995 through March 31, 1996, the Company matched 30% of each 
participant's contributions with the Company's contribution limited to a 
maximum of 1.8% of the employee's total compensation for employees earnings 
less than $150,000 per year.  For employees earning over $150,000 per year, 
the Company matched 25% of each participant's contributions with the Company's 
contribution limited to a maximum of 1% of the employee's total compensation.  
On April 1, 1996, the Company matching contribution rates were increased to 
50% and 3.0% of total compensation, respectively, for employees earning up to
$150,000 per year and 35% and 2.1% of total compensation, respectively, for 
employees earning over $150,000 per year.  

  Contributions and salary deferrals are subject to limitations imposed by the 
Internal Revenue Code.  The Company may, at its sole discretion, contribute 
additional amounts to all employees on a pro rata basis.  All employee 
contributions into the Plan are 100% vested, while the Company's matching 
contributions vest over a five-year period.  The Company contributed 
approximately $1,241,000, $801,000 and $369,000 to the Plan during the years 
ended December 31, 1997, 1996 and 1995, respectively. 

                                   -38-
<PAGE> 39

Jones Apparel Group, Inc.
Notes to Consolidated Financial Statements (Continued)


NOTE 16.  EARNINGS PER SHARE

  Basic and diluted earnings per share for each of the three years ended 
December 31, 1997, 1996 and 1995 are calculated as follows (in thousands 
except per share amounts):

                                               
                                              Net                    Per-share
                                           Income        Shares         Amount
                                         --------        ------         ------
For the year ended December 31, 1997:

  Basic earnings per share               $121,725        51,899          $2.35

  Effect of assumed conversion 
    of employee stock options                   -         2,006          $0.09
                                         --------        ------         ------
  Diluted earnings per share             $121,725        53,905          $2.26
                                         ========        ======         ======
For the year ended December 31, 1996:

  Basic earnings per share                $80,874        52,333          $1.55

  Effect of assumed conversion 
    of employee stock options                   -         1,318          $0.04
                                          -------        ------         ------
  Diluted earnings per share              $80,874        53,651          $1.51
                                          =======        ======         ======
For the year ended December 31, 1995:

  Basic earnings per share                $63,485        52,130          $1.22

  Effect of assumed conversion 
    of employee stock options                   -           894          $0.02
                                          -------        ------         ------
  Diluted earnings per share              $63,485        53,024          $1.20
                                          =======        ======         ======

  Options to purchase 1,590,000 shares of common stock at exercise prices 
ranging from $45 5/16 to $51 1/2 per share were outstanding during a portion
of 1997 but were not included in the computation of diluted earnings per 
share because the exercise prices of the options were greater than the average 
market price of the common shares. These options, which expire between 
July 22 and December 12, 2007, were all outstanding at the end of 1997.

                                   -39-

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

 Not Applicable.




                             PART III


ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Directors and Executive Officers

  The directors and executive officers of the Company are as follows:

Name                        Age            Office
---------------------       ---            -----------------------------------
Sidney Kimmel                70            Chairman and Director

Herbert J. Goodfriend        71            Vice Chairman and Director

Jackwyn Nemerov              46            President

Irwin Samelman               67            Executive Vice President, Marketing
                                           and Director

Wesley R. Card               50            Chief Financial Officer

Patrick M. Farrell           48            Vice President and 
                                           Corporate Controller

Geraldine Stutz              69            Director

Howard Gittis                64            Director


  Each director who is not a full-time employee of the Company will receive an 
annual grant of options to purchase 1,000 shares of the Company's common stock 
at an exercise price of $1.00 per share.  Each option will expire on the 
tenth anniversary of its date of grant, and will be exercisable, in whole or in 
part, commencing six months from the date of grant and thereafter during the 
exercise period. Officers are appointed by the Board of Directors.

  The Board of Directors has appointed an Audit Committee consisting of Ms. 
Stutz and Mr. Gittis.  The Audit Committee meets periodically to review and 
make recommendations with respect to the Company's internal controls and 
financial reports, and in connection with such reviews, has met with appropriate
Company financial personnel and the Company's independent certified public 
accountants.  The Board of Directors has also appointed a Stock Option 
Committee consisting of Ms. Stutz and Mr. Gittis to administer the 1991 and 
1996 Stock Option Plans and a Compensation Committee consisting of Ms. Stutz and
Mr. Gittis to determine cash and other incentive compensation to be paid to 
the Company's executive officers. 

  Mr. Kimmel founded the Jones Apparel Division of W.R. Grace & Co. in 1970.  
Mr. Kimmel has served as Chairman since 1975.  Prior to 1975, Mr. Kimmel 
occupied various executive offices including President 

                                   -40-
<PAGE> 41

of Jones New York and Vice President of John Meyer of Norwich.  Prior to 
founding Jones, Mr. Kimmel was employed by W.R. Grace & Co. and was President of
Villager, Inc., a sportswear company.

  Mr. Goodfriend joined the Company in 1990 after serving as the Company's legal
counsel for the previous three years and has served as a director since July
1991.  Before joining Jones, Mr. Goodfriend served as a director of Villager,
Inc. and Venice Industries, Inc.  In addition, Mr. Goodfriend is engaged in the 
practice of law and is of counsel to the firm of Phillips Nizer Benjamin Krim & 
Ballon LLP, which performs legal services for the Company.

  Ms. Nemerov was appointed President in January 1997.  She joined the Company 
in 1985 and served as President of the Company's casual sportswear divisions 
and the Lauren by Ralph Lauren division.  Prior to joining Jones, Ms. Nemerov
was President of the Gloria Vanderbilt division of Murjani, Inc. from 1980
through 1985.

  Mr. Samelman has been Executive Vice President, Marketing of the Company since
1991 and has served as a director since July 1991.  In addition, from 1987 to 
1991, Mr. Samelman provided marketing consulting services to the Company 
through Samelman Associates, Inc., a private consulting company controlled by 
him.  Prior thereto, Mr. Samelman was Regional Marketing Manager of Russ Togs, 
Inc. and Vice President of Villager, Inc.

  Mr. Card joined the Company in 1990.  Prior to joining Jones, Mr. Card held 
the positions of Executive Vice President and Chief Financial Officer of 
Carolyne Roehm, Inc., and Corporate Vice President, Controller and Assistant 
Secretary of Warnaco, Inc. 

  Mr. Farrell was appointed Vice President and Corporate Controller in November 
1997.  He joined the Company in 1994 as Director of Internal Audit and served
as Vice President, Finance and Administration of Retail Operations of the 
Company since 1995.  Prior to joining the Company, Mr. Farrell was Director of
Internal Audit for Crystal Brands, Inc.

  Ms. Stutz has been a director of the Company since July 1991.  Since 1993, Ms.
Stutz has been a principal partner of Panache Productions, a fashion and 
marketing service.  During the previous five years, she was Publisher of
Panache Press at Random House, a book publisher.  From 1960 until 1986, Ms. 
Stutz was President of Henri Bendel.  Ms. Stutz serves on the Board of 
Directors of Tiffany & Co., The Theatre Development Fund and The Actors' Fund.

  Mr. Gittis has been a director of the Company since April 1992.  During the 
past five years, Mr. Gittis' principal occupation has been Director and Vice 
Chairman of MacAndrews & Forbes Holdings Inc., a diversified holding company.
In addition, Mr. Gittis is a director of Andrews Group Incorporated,  
California Federal Bank, a Federal Savings Bank, Consolidated Cigar 
Corporation, Consolidated Cigar Holdings Inc., First Nationwide Holdings 
Inc., First Nationwide (Parent) Holdings Inc., Loral Space and Communications
Ltd., Mafco Consolidated Group Inc., Pneumo Abex Corporation, Power Control 
Technologies, Inc., Revlon, Inc., Revlon Consumer Products Corporation, Revlon 
Worldwide Corporation and Rutherford-Moran Oil Corporation.


Key Employees

  The following persons, although not executive officers of the Company, make 
significant business contributions to the Company:

  Rena Rowan was the original creator of the Jones New York line and served as 
the division's Chief Designer from 1970 to 1982.  She is currently 
Vice President, Design of the Company.  From 1991 to 1993, Ms.

                                   -41-

<PAGE> 42

Rowan was an executive vice president of the Company.  Prior to the inception of
Jones New York, Ms. Rowan was employed by Villager, Inc. and Rosenau, Inc.

  Anita Britt, Director of Investor Relations and Financial Planning, joined the
Company in December 1993.  Prior to joining the Company, Ms. Britt was 
Director of Internal Audit of American Reliance Group, Inc.

  Howard Buerkle has been President of Retail Operations for the Company since 
1989.  From 1986 through 1989, Mr. Buerkle was President of the retail 
division of Inwear/Martinique.

  Ellen Daniel, President of the Evan-Picone Collection division, joined Jones 
in 1994.  From 1982 through 1994, Ms. Daniel was employed by Liz Claiborne, 
most recently as Senior Vice President - Corporate Design Director.

  Ira Dansky joined the Company in 1996 as General Counsel.  Prior to joining 
the Company, Mr. Dansky was engaged in private law practice from 1987 
through 1996, prior to which he served as Associate General Counsel of 
Xerox Corporation.

  Ronald Harrison, Vice President of Manufacturing, joined the Company in 1981.
Mr. Harrison had been Plant Manager for Chief Apparel, Inc. from 1965 through
1981.

  Joseph Hiess was appointed President of the Jones New York Men's Sportswear 
division in August 1997.  Prior to his appointment, Mr. Hiess served as head 
of Design and Marketing of JJ Farmer, a menswear company he founded in 1986 
and subsequently sold to Salant Corporation in 1993.

  Barbara Kennedy has been President of the Jones New York Dress Division since 
August 1991.  From 1983 through August 1991, Ms. Kennedy was employed by 
Bloomingdale's in various capacities, most recently as Vice President, 
Merchandise Manager.

  Gary R. Klocek has been Controller of Jones Apparel Group, Inc. since 
August 1987.  Prior to joining Jones, Mr. Klocek held various positions with 
Atlantic Richfield Company ("ARCO") from 1979 through 1987, his last position
being Manager of Cost and Inventory Control for one of ARCO's subsidiaries.

  Jeffrey Levy, President of Rena Rowan, joined the Company in 1990.  Prior to 
joining Jones, Mr. Levy was Vice President of Sales and National Sales 
Manager, of Russ Togs, Inc. from 1984 through 1990. 

  Benny Lin, Senior Vice President - Creative Director, joined Jones Apparel 
Group in December 1995.  Mr. Lin had been Fashion Director at Macy's East 
prior to joining the Company.

  Martin Marlowe joined Jones Apparel Group in 1992 as Vice President of Foreign
Manufacturing.  Prior to joining Jones, Mr. Marlowe was President of Jodi 
International, an apparel importer, from 1988 to 1992. 

  Helen Merril, President of the Evan-Picone Dress Divisions, joined Jones 
Apparel Group in October 1993.  Prior to joining the Company, Ms. Merril held 
the positions of President of Scassi Dress of De Peche Corporation and 
President of Nippon Boutique of Albert Nippon Inc.

  Susan Metzger, Vice President of Sales for the Lauren by Ralph Lauren 
division, joined the Company in May 1996.  Prior to joining Jones Apparel 
Group, Ms. Metzger held the positions of Vice President of Sales of Chaus, 
Inc. and Sales Manager of JH Collectibles. 

  Heather Pech, President of the Jones New York Sport Collection division, 
joined the Company in 1990.  Ms. Pech had been Account Executive at 
Calvin Klein, Inc. prior to joining Jones.

                                   -42-
<PAGE> 43

  Deanna Randall, who joined the Company in 1981, has held various sales and 
marketing positions with the Company, and is currently President of the 
Jones New York career division.

  Susan Rieland, President of Casual Design, joined the Company in 1994.  Ms.  
Rieland had been Account Executive at Rafaella prior to joining Jones.

  John Sammaritano, Vice President of Distribution, joined Jones in 1975.  
Mr. Sammaritano had been Vice President of Distribution for Villager, Inc. 
from 1964 through 1975.

  Richard Shaw, President of Jones Apparel Group Canada, Inc., joined the 
Company in May 1997.  Prior to joining the Company, Mr. Shaw served as 
President of Liz Claiborne Canada, which he helped launch in 1987.


ITEM 11.  EXECUTIVE COMPENSATION

  The information appearing in the Proxy Statement under the captions 
"EXECUTIVE COMPENSATION" and "EMPLOYMENT AND COMPENSATION ARRANGEMENTS" 
is incorporated herein by this reference.


ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

  The information appearing in the Proxy Statement under the caption "SECURITY 
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS" is incorporated herein by this 
reference.


ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

  The information appearing in the Proxy Statement under the captions "CERTAIN 
TRANSACTIONS" and "COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION"
are incorporated herein by this reference.



                              PART IV


ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

    (a) The following documents are filed as part of this report:

        1.  The schedule and report of independent certified public accountants 
            thereon, listed on the Index to Financial Statement Schedules 
            attached hereto.

        2.  The Exhibits, which are listed on the Exhibit Index attached hereto.

    (b) No reports on Form 8-K were filed by the registrant during the last 
        quarter of the period covered by this report.

                                   -43-
<PAGE> 44

                            SIGNATURES


  Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this Amendment to the Annual Report 
on Form 10-K to be signed on its behalf by the undersigned, thereunto duly 
authorized.

Dated: March 26, 1998
                                                      JONES APPAREL GROUP, INC.
                                                      (Registrant)

                                                By:   /s/ Sidney Kimmel
                                                      Sidney Kimmel, Chairman 

    Pursuant to the requirements of the Securities Exchange Act of 1934, this 
report has been signed below by the following persons on behalf of the 
registrant and in the capacities and on the dates indicated.

     Signature                         Title                        Date
---------------------        -----------------------------      --------------
/s/ Sidney Kimmel            Chairman and Director              March 26, 1998
-----------------            (Chief Executive Officer)
(Sidney Kimmel)              


/s/ Wesley R. Card           Chief Financial Officer            March 26, 1998
------------------           (Principal Financial Officer)
(Wesley R. Card)

/s/ Patrick M. Farrell       Vice President and                 March 26, 1998
----------------------       Corporate Controller
(Patrick M. Farrell)         (Principal Accounting Officer)


/s/ Herbert J. Goodfriend    Vice Chairman and Director         March 26, 1998
-------------------------
(Herbert J. Goodfriend)


/s/ Irwin Samelman           Executive Vice President,          March 26, 1998
------------------           Marketing and Director
(Irwin Samelman)

/s/ Geraldine Stutz          Director                           March 26, 1998
-------------------
(Geraldine Stutz)


/s/ Howard Gittis            Director                           March 26, 1998
-----------------
(Howard Gittis)              

                                  -44-

<PAGE> 45

JONES APPAREL GROUP, INC.

INDEX TO FINANCIAL STATEMENT SCHEDULES


Report of Independent Certified Public Accountants on Schedule

Schedule II.          Valuation and qualifying accounts

    
Schedules other than those listed above have been omitted since the information
is not applicable, not required or is included in the respective financial 
statements or notes thereto.



EXHIBIT INDEX

Incorporated
by Reference          Exhibit
to Exhibit            Nos.        Description of Exhibit
------------          -------     ----------------------

(5) 3.1               3.1         Articles of Incorporation, as amended

(1) 3.3               3.3         By-Laws

(3) 3.4               3.4         Amendment to By-Laws

(1) 10.2              10.2        Lease Agreement between the Registrant and 
                                  Bristol Associates, L.P., re:
                                  250 Rittenhouse Circle

(1) 10.5              10.5        Form of 1991 Stock Option Plan+

(1) 10.7              10.7        Employment and Stock Option 
                                  Agreements between the Registrant and
                                  Herbert J. Goodfriend+

(2) 10.17             10.17       Note Agreement with The Industrial 
                                  Development Board of the City of
                                  Lawrenceburg, Tennessee

(2) 10.18             10.18       Industrial Development Board of the City of
                                  Lawrenceburg Taxable
                                  Revenue Note, Series 1995

(2) 10.19             10.19       Lease agreement between the Registrant and 
                                  the Industrial
                                  Development Board of the City of Lawrenceburg

(4) 10.26             10.26       Series 1996 Note Agreement with The 
                                  Industrial Development Board of the City of
                                  Lawrenceburg, Tennessee

(4) 10.27             10.27       Industrial Development Board of the City of
                                  Lawrenceburg Taxable
                                  Revenue Note, Series 1996

(4) 10.28             10.28       First Amendment to Lease Agreement between 
                                  the Registrant and the Industrial 
                                  Development Board of the City of Lawrenceburg

(4) 10.29             10.29       Agreement between the Registrant and 
                                  Herbert J. Goodfriend with respect to 
                                  consulting services following termination 
                                  of employment 

                                  -45-
<PAGE> 46

Incorporated
by Reference          Exhibit
to Exhibit            Nos.        Description of Exhibit
------------          -------     ----------------------

(5) 10.30             10.30       Series 1996 Note Agreement with The 
                                  Industrial Development Board of the City of
                                  Lawrenceburg, Tennessee

(5) 10.31             10.31       Industrial Development Board of the City of
                                  Lawrenceburg Taxable
                                  Revenue Note, Series 1996

(5) 10.32             10.32       Lease Agreement between the Registrant and 
                                  the Industrial Development Board of the 
                                  City of Lawrenceburg

(5) 10.33             10.33       Form of 1996 Stock Option Plan+ 

(5) 10.34             10.34       Letter Agreement between the Registrant and
                                  CoreStates Bank

(5) 10.35             10.35       Master Short Term Borrowing Agreement 
                                  between the Registrant and CoreStates Bank

(5) 10.36             10.36       Letter Agreement between the Registrant and 
                                  First Union National Bank

(5) 10.37             10.37       Letter Agreement between the Registrant and
                                  the Bank of New York

(5) 10.38             10.38       Letter Agreement between the Registrant and
                                  Bank of Boston

(5) 10.39             10.39       Money Market Line Commercial Promissory 
                                  Note between the Registrant and Bank of Boston

(5) 10.40             10.40       License Agreement between the Registrant 
                                  and Polo Ralph Lauren, L.P., dated October 
                                  18, 1995#

(5) 10.41             10.41       Design Services Agreement between the 
                                  Registrant and Polo Ralph Lauren, L.P., 
                                  dated October 18, 1995#

(5) 10.42             10.42       Lease Agreement between the Registrant and 
                                  The Shelton Companies

(5) 10.43             10.43       Letter Agreement between the Registrant and
                                  Israel Discount Bank of New York

    *                 10.44       Series 1997 Note Agreement with The 
                                  Industrial Development Board of the City of
                                  Lawrenceburg, Tennessee

    *                 10.45       Industrial Development Board of the City of
                                  Lawrenceburg Taxable Revenue Note, Series 
                                  1997
   
    *                 10.46       Amendment to Lease Agreement between the 
                                  Registrant and the Industrial Development 
                                  Board of the City of Lawrenceburg

    *                 10.47       Letter Agreement between the Registrant 
                                  and First Union National Bank


                                  -46-
<PAGE> 47

Incorporated
by Reference          Exhibit
to Exhibit            Nos.        Description of Exhibit
------------          -------     ----------------------

    *                 10.48       Letter Agreement between the Registrant and
                                  CoreStates Bank

    *                 10.49       Letter Agreement between the Registrant and
                                  BankBoston

    *                 10.50       Money Market Line Commercial Promissory 
                                  Note between the Registrant and BankBoston

    *                 10.51       Letter Agreement between the Registrant and
                                  The Chase Manhattan Bank

    *                 10.52       Term Note and Unconditional Guaranty with 
                                  First Union National Bank

    *                 11          Computation of Earnings per Share

    *                 21          List of Subsidiaries

    *                 23          Consent of BDO Seidman, LLP

    *                 27          Financial Data Schedule (6)

    *                 27.1        Restated Financial Data Schedule for 1996
                                  and 1995 (6) 

    *                 27.2        Restated Financial Data Schedule for 1997
                                  interim periods (6)

    *                 27.3        Restated Financial Data Schedule for 1996
                                  interim periods (6)
____________________
*   Filed herewith.

#   Portions deleted pursuant to application for confidential treatment under
    Rule 24B-2 of the Securities Exchange Act of 1934.

+   Management contract or compensatory plan or arrangement.

(1) Incorporated by Reference to the Company's Registration Statement on Form 
    S-1 (file No. 33-39742).

(2) Incorporated by Reference to the Company's Annual Report on Form 10-K for 
    the fiscal year ended December 31, 1993.

(3) Incorporated by Reference to the Company's Annual Report on Form 10-K for 
    the fiscal year ended December 31, 1994.

(4) Incorporated by Reference to the Company's Annual Report on Form 10-K for 
    the fiscal year ended December 31, 1995.

(5) Incorporated by Reference to the Company's Annual Report on Form 10-K for 
    the fiscal year ended December 31, 1996.

(6) Exhibit 27 is submitted as an exhibit only in the electronic format of this
    Annual Report on Form 10-K submitted to the Securities and Exchange 
    Commission.)

                                   -47-
<PAGE> 48

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

Jones Apparel Group, Inc.
New York, New York

The audits referred to in our dated February 6, 1998 relating to the
consolidated financial statements of Jones Apparel Group, Inc. and subsidiaries,
which is contained in Item 8 of Form 10-K, included the audits of the financial 
statement schedule listed in the accompanying index for each of the three years
ended December 31, 1997.  The financial statement schedule is the responsibility
of management.  Our responsibility is to express an opinion on the financial 
statement schedule based upon our audits.

In our opinion, such financial statement schedule presents fairly, in all
material respects, the information set forth therein.

/s/ BDO Seidman, LLP

BDO Seidman, LLP

New York, New York
February 6, 1998

                                   -48-
<PAGE> 49

                                                                   SCHEDULE II

            JONES APPAREL GROUP, INC. AND SUBSIDIARIES

                VALUATION AND QUALIFYING ACCOUNTS
           YEARS ENDED DECEMBER 31, 1995, 1996 AND 1997
                          (In Thousands)


<TABLE>
<CAPTION>


          Column A                   Column B             Column C            Column D     Column E
-------------------------------      ----------   -------------------------   ----------   ---------
                                                         Additions
                                                  -------------------------
                                     Balance at   Charged to    Charged to                 Balance
                                     beginning    costs and     other         Deductions   at end of
Description                          of period    expenses      accounts         <F1>      period  
------------                         ----------   ----------    -----------   ----------   ---------
<S>                                  <C>          <C>           <C>           <C>          <C>
For the year ended
  December 31, 1995:
    Allowance for doubtful accounts      $2,560       $(464)           $  -        $(161)    $2,257


For the year ended
  December 31, 1996:
    Allowance for doubtful accounts      $2,257       $(800)           $  -        $(806)    $2,263


For the year ended
  December 31, 1997:
    Allowance for doubtful accounts      $2,263     $(1,870)           $  -       $2,374     $2,767

 
</TABLE>

<F1>  Doubtful accounts written off (recovered) against accounts receivable.

                                   -49-