UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

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

                 For the quarterly period ended November 1, 1997



                         Commission file number 1-11609


                                TOYS "R" US, INC.
                  Incorporated pursuant to the Laws of Delaware



        Internal Revenue Service - Employer Identification No. 22-3260693
                    461 From Road, Paramus, New Jersey 07652
                                 (201) 262-7800



        The  registrant  (1) has filed all  reports 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.

        283,996,858 shares of the registrant's  Common Stock were outstanding on
        November 25, 1997.



<PAGE>



                                                 INDEX


                                                                           PAGE

PART I - FINANCIAL INFORMATION

 Item 1. Financial Statements

         Condensed Consolidated Balance Sheets................................2

         Condensed Consolidated Statements of Earnings........................3

         Condensed Consolidated Statements of Cash Flows......................4

         Notes to Condensed Consolidated Financial
         Statements...........................................................5

 Item 2. Management's Discussion and Analysis of Results of Operations and 
         Financial Condition..................................................6

PART II - OTHER INFORMATION...................................................9

SIGNATURES...................................................................11


                                       1

<PAGE>

<TABLE>

             TOYS "R" US, INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED BALANCE SHEETS

                        (Unaudited)
                        (In millions)

<CAPTION>

                                              November 1, November 2, February 1,
                                                 1997         1996        1997
<S>                                              <C>          <C>         <C> 

ASSETS 
Current Assets:
  Cash and cash equivalents                      $  282.6   $  651.7   $  760.9
  Accounts and other receivables                    173.6      152.7      142.1
  Merchandise inventories                         3,923.5    3,582.2    2,214.6
  Prepaid expenses and other current assets          74.1      133.1       42.0

     Total current assets                         4,453.8    4,519.7    3,159.6

  Property and equipment, net and other assets    4,676.9    4,401.8    4,498.6
  Goodwill, net                                     358.2      --         365.0

                                               $  9,488.9  $ 8,921.5  $ 8,023.2


LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
  Short-term borrowings                        $  1,260.9 $  1,377.1 $    303.5
  Accounts payable                                2,289.4    2,198.5    1,346.5
  Accrued expenses and other current liabilities    488.3      428.1      720.0
  Income taxes payable                               54.2      --         170.7

     Total current liabilities                    4,092.8    4,003.7    2,540.7


Long-term debt                                      901.2    1,028.3      908.5
Deferred income taxes                               235.0      245.7      222.5
Other liabilities                                   129.3      146.7      160.9
Stockholders' equity                              4,130.6    3,497.1    4,190.6

                                                   9,488.9    8,921.5    8,023.2
<FN>


     See accompanying notes to condensed consolidated financial statements.

</FN>
</TABLE>

                                        2


<PAGE>
<TABLE>


                       TOYS "R" US, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

                                   (Unaudited)

                       (In millions except per share data)

<CAPTION>

                                                          13 Weeks Ended               39 Weeks Ended
                                                 November 1,     November 2,      November 1,     November 2,
                                                    1997             1996            1997             1996
<S>                                                 <C>              <C>             <C>              <C>

Net sales....................................  $   2,141.9    $   1,883.0     $   6,055.0     $   5,264.9

Costs and expenses:
         Cost of sales ......................      1,455.5        1,280.4         4,136.5         3,582.1
         Selling, advertising, general &
         administrative .....................        532.8          474.1         1,513.6         1,341.4
         Depreciation and amortization ......         59.4           51.4           171.1           149.3
         Other charges ......................          --             --             --              55.0
         Interest expense - net .............         22.3           24.2            57.8            66.4

                                                   2,070.0        1,830.1         5,879.0         5,194.2

Earnings before taxes on income .............         71.9           52.9           176.0            70.7
Income tax expense ..........................         26.2           19.6            64.2            26.2
Net earnings   ..............................  $      45.7    $      33.3     $     111.8     $      44.5

Earnings per share ..........................  $      .16     $     .12       $     .39       $      .16

Weighted average number of common 
and common equivalent shares outstanding ....        288.9          278.7           288.7            277.0


<FN>

     See accompanying notes to condensed consolidated financial statements.

</FN>
</TABLE>

                                        3

<PAGE>
<TABLE>


                       TOYS "R" US, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                  (In millions)

<CAPTION>


                                                                        39 Weeks Ended
                                                                    November 1,  November 2,
                                                                       1997         1996
<S>                                                                    <C>          <C>    

Cash flows from operating activities:
Net earnings ...............................................   $    111.8  $     44.5
Adjustments to reconcile net earnings to net cash
used in operating activities:
   Depreciation and amortization ...........................        171.1       149.3
   Deferred income taxes....................................         12.4         9.0
   Changes in operating assets and liabilities:
     Merchandise inventories ...............................     (1,708.9)   (1,581.3)
     Accounts payable and other operating liabilities ......        677.0       847.3
     Other operating assets.................................        (66.7)      (78.5)      
   Net cash used in operating activities ...................       (803.3)     (609.7)

Cash flows used in investing activities:
Capital expenditures, net ..................................       (387.5)     (315.4)

Cash flow from financing activities:
Short-term borrowing, net ..................................        957.4     1,047.6
Long-term borrowings .......................................          9.9       325.4
Exercise of stock options ..................................         58.0        24.8
Long-term debt repayment ...................................       (135.6)      (27.2)
Share repurchase program ...................................       (212.1)     --
  Net cash provided by financing activities ................        677.6     1,370.6

Effect of exchange rate changes on cash and cash equivalents         34.9         3.5
Cash and cash equivalents:
(Decrease)/increase during period ..........................       (478.3)      449.0
Beginning of period ........................................        760.9       202.7
End of period ..............................................   $    282.6  $    651.7

Supplemental disclosures of cash flow information:
Income taxes paid ..........................................   $    154.4  $    170.6


Interest paid ..............................................   $     79.0  $     79.5

<FN>


     See accompanying notes to condensed consolidated financial statements.

</FN>
</TABLE>


                                        4

<PAGE>

                       TOYS "R" US, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.       Interim Reporting

         The  interim  financial  statements  are  unaudited  and are subject to
         year-end adjustments.  However, in the opinion of management, all known
         adjustments (which consist primarily of normal recurring accruals) have
         been made and the  interim  financial  statements  present  fairly  the
         consolidated   financial   condition  and  operating  results  for  the
         unaudited  periods.  Results for interim  periods are not indicative of
         results to be expected for the fiscal year due to the  seasonal  nature
         of the Company's business.

2.       Earnings Per Share

         In February  1997,  the  Financial  Accounting  Standards  Board issued
         Statement No. 128, Earnings per Share,  which is required to be adopted
         on January 31, 1998, the last day of the Company's fiscal year. At that
         time, the Company will be required to change the method  currently used
         to compute earnings per share and restate all prior periods.  Under the
         new  requirements  for  calculating  primary  earnings  per share,  the
         dilutive  effect  of stock  options  will be  excluded.  The  impact of
         adopting the new  standard  will not result in a change to earnings per
         share for the third  quarter or nine month  periods  ended  November 1,
         1997 and November 2, 1996, as presented.

3.       Other Charges

         On July 12,  1996,  an  arbitrator  rendered an award in favor of Yusuf
         Ahmed Alghanim & Sons, W.L.L.  ("Alghanim") and against the Company and
         awarded  Alghanim $46.4 million plus interest from December 1994.  This
         award was rendered in connection  with a dispute  between  Alghanim and
         the Company  involving  rights under a 1982 license  agreement  for toy
         store  operations  in the Middle  East.  Accordingly,  the  Company has
         recorded a provision of $59.5 million  during fiscal 1996  representing
         all expected costs in connection with this matter. The Company believed
         that the findings of the arbitrator  were not supported by the evidence
         presented  in the case and  contested  this award in the United  States
         District  Court.  That motion was denied on December 13, 1996,  and the
         arbitration  award was confirmed.  The Company filed an appeal with the
         United States Court of Appeals for the Second Circuit. On September 10,
         1997, the Second Circuit  affirmed the District Court's  decision.  The
         Company is planning  to seek review in the Supreme  Court of the United
         States, and has obtained a stay of judgment pending that application.

4.       Other Matters

         See Part II - Item 1. - Legal Proceedings

                                        5
<PAGE>


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

Results of Operations

Total sales  increased  14 percent to $2.1 billion for the third  quarter  ended
November  1, 1997 as compared  with $1.9  billion  for the third  quarter  ended
November 2, 1996.  For the first nine months of 1997,  total sales  increased 15
percent to $6.1 billion as compared  with $5.3 billion for the first nine months
of 1996.  Excluding  the impact of foreign  currency,  total sales  increased 16
percent in the third  quarter  and 17 percent for the first nine months of 1997,
as compared with the same periods in the prior year. The increase in total sales
is attributable  to the increase in comparable  store sales during these periods
and the Company's  continued store expansion,  including the acquisition of Baby
Superstore on February 3, 1997.

Comparable USA toy store sales increased by 6 percent for both the third quarter
and first nine months of 1997, as compared with the same periods in 1996.  These
increases  were  primarily  driven by strong sales of video  products as well as
action  figures,  plush,  diecast cars,  juvenile  merchandise and virtual pets.
Internationally,  the Company  experienced a comparable toy store sales increase
in local  currency  for the  third  quarter  and  first  nine  months of 1997 as
compared with the same periods in 1996,  including double digit comparable store
sales   increases   in  both   Canada  and   Australia.   The  sales   increases
internationally  were  primarily  driven by the continued  strength of the video
game business and virtual pets, as well as innovative  marketing and advertising
programs.  The Company's  Kids "R" Us division  experienced  a comparable  store
sales increase in the third quarter,  while comparable store sales decreased for
the first nine months of 1997. The Babies "R" Us division experienced comparable
store sales  decreases  for the third quarter and the first nine months of 1997,
primarily  due to  the  expected  impact  during  the  transition  of  the  Baby
Superstore locations to Babies "R" Us, which is now complete.

Cost of sales, as a percentage of sales, remained constant for the third quarter
and increased by 0.3 percent for the first nine months of 1997, as compared with
the same  periods  in 1996.  The  increase  for the first  nine  months  was due
primarily to the negative  impact on the sales mix caused by increased  sales of
low margin video  hardware  merchandise,  somewhat  offset by lower sales of low
margin consumables.

Selling,  advertising,  general and  administrative  expenses as a percentage of
sales  decreased by 0.3 percent and 0.5 percent for the third  quarter and first
nine months of 1997,  respectively,  as compared  with the same periods in 1996,
primarily as a result of continued expense control and sales leveraging.

Depreciation and amortization  increased by $8 million and $21.8 million for the
third quarter and first nine months of 1997, respectively,  as compared with the
same periods in 1996,  primarily as a result of the  Company's  continued  store
expansion,  as well as goodwill amortization relating to the acquisition of Baby
Superstore.

                                        6


<PAGE>


          MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
                             AND FINANCIAL CONDITION
                                   (continued)

The arbitration  award (See footnote 3 to the condensed  consolidated  financial
statements)  reduced  earnings  per  share  by $.13 for the  nine  months  ended
November 2, 1996.  Excluding the impact of the award,  net earnings for the nine
months ended November 2, 1996 would have been $79.1 million or $.29 per share.

Net  interest  expense  decreased by $1.9 million and $8.6 million for the third
quarter and first nine months of 1997,  respectively,  as compared with the same
periods  in 1996,  due in part to the  closing  of a  medium-term  $325  million
financing in the second half of 1996 which replaced  borrowings  carrying higher
interest rates.

Foreign currency exchange did not have a material effect on net earnings for the
third quarter or the first nine months of 1997.


Financial Condition

The Company  opened 19 new toy stores in the United  States this year  utilizing
the  "Concept  2000" store  design.  The  Company  also opened 3 new Kids "R" Us
stores  and 12 new  Babies "R" Us stores in the  United  States  this year.  The
Company  plans to open an  additional  8 new  Babies "R" Us stores by the end of
1997.  Internationally,  the Company added 37 new toy stores this year and plans
to add an additional 8 new  international  toy stores by the end of fiscal 1997.
16 of the new  international toy stores added this year will be either franchise
or joint venture stores. In addition, the Company completed the remodeling of 56
toy stores in the United States into the "Concept 2000" format. Store remodeling
plans for 1998 are currently being developed but have not yet been finalized.

Short-term  borrowings,  net of  investments  increased  by  $252.9  million  at
November 1, 1997 as compared  with the November 2, 1996 due  primarily to higher
inventory levels, increased capital expenditures and cash used for the Company's
share repurchase program.

Long-term   debt   repayments  of  $135.6   million  this  year  were  primarily
attributable to the retirement of convertible  debt assumed with the acquisition
of Baby Superstore.

The Company repurchased 6.7 million shares of its common stock through its share
repurchase  program for $212.1  million during the first nine months of 1997, of
which  $124  million  was  spent  in the  third  quarter  of 1997.  The  Company
repurchased  28 million shares of its common stock for $906 million since the $1
billion share repurchase program was announced in January 1994.


                                        7

<PAGE>


          MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
                             AND FINANCIAL CONDITION
                                   (continued)

Annual capital  expenditures for new and existing facilities are estimated to be
approximately  $575 million for 1997. Cash requirements for operations,  capital
expenditures,  lease  commitments and the share  repurchase  program will be met
primarily  through  operating  activities,   borrowings  under  the  $1  billion
revolving  credit  facility,  issuance of short-term  commercial  paper and bank
borrowings by foreign subsidiaries.

The Company's  restructuring  program action plan is substantially  complete and
the restructuring  reserves are considered adequate to cover all estimated costs
of the  restructuring  program.  The  Company  is  currently  working  with  its
franchisee in the  Netherlands to meet the ownership requirements  established 
by the European Economic Union.

Weighted  average common  equivalent  shares  increased to 288.7 million for the
nine month period ended  November 1, 1997  compared  with 277.0 million from the
same period a year ago, due primarily to 13 million  treasury  shares of Company
common  stock  issued  in  connection  with the  Company's  acquisition  of Baby
Superstore on February 3, 1997.
























                                        8



<PAGE>


                           PART II - OTHER INFORMATION

Item 1.           Legal Proceedings

                  1) On May 22, 1996, the Staff of the Federal Trade  Commission
                  (the  "FTC")  filed an  administrative  complaint  against the
                  Company alleging that the Company is in violation of Section 5
                  of the Federal Trade Commission Act for its practices relating
                  to warehouse  clubs.  The  complaint  alleges that the Company
                  reached   understandings  with  various  suppliers  that  such
                  suppliers  not sell to the clubs the same items that they sell
                  to the Company.  The  complaint  also alleges that the Company
                  "facilitated understandings" among the manufacturers that such
                  manufacturers  not sell to clubs. The complaint seeks an order
                  that the  Company  cease and desist  from this  practice.  The
                  matter  was tried  before an  administrative  law judge in the
                  period from March  through May of 1997. On September 30, 1997,
                  the   administrative  law  judge  filed  an  Initial  Decision
                  upholding the FTC's complaint against the Company.

                  After the filing of the FTC complaint,  several class
                  action suits were filed against the Company in State courts in
                  Alabama and California, alleging that the Company has violated
                  certain  state  competition  laws  as  a  consequence  of  the
                  behavior  alleged  in the FTC  complaint.  After  the  Initial
                  Decision was handed down,  more than twenty class actions were
                  filed in federal  and state  courts in  various  jurisdictions
                  alleging  that the Company has violated the federal  antitrust
                  laws  as a  consequence  of the  behavior  alleged  in the FTC
                  complaint.  In addition, the attorneys general of thirty-eight
                  states,  the District of Columbia and Puerto Rico have filed a
                  suit against the Company in their capacity as  representatives
                  of the  consumers of their  states,  alleging that the Company
                  has violated federal and state antitrust laws as a consequence
                  of the behavior alleged in the FTC complaint. These suits seek
                  damages in  unspecified  amounts and other  relief under state
                  and/or federal law.

                  The  next  stage  in  the  FTC  matter  is an  appeal  to  the
                  Commissioners of the FTC. The Company will be entitled to have
                  the United States  Circuit Court of Appeals review any adverse
                  decision by the FTC.

                  The Company  believes  that both its policy and its conduct in
                  connection  with the foregoing are within the law. The Company
                  also  believes  that  these  actions  will not have a material
                  adverse  effect  on  its  financial   condition,   results  of
                  operations or cash flow.







                                        9

<PAGE>


                           PART II - OTHER INFORMATION
                                   (Continued)

                  2) On July 12, 1996, an arbitrator  rendered an award in favor
                  of  Yusuf  Ahmed  Alghanim  & Sons,  W.L.L.  ("Alghanim")  and
                  against the Company and awarded  Alghanim  $46.4  million plus
                  interest  from  December  1994.  This  award was  rendered  in
                  connection  with a dispute  between  Alghanim  and the Company
                  involving rights under a 1982 license  agreement for toy store
                  operations  in the Middle East.  Accordingly,  the Company has
                  recorded a provision of $59.5 million during 1996 representing
                  all expected costs in connection with this matter. The Company
                  believed  that  the  findings  of  the  arbitrator   were  not
                  supported by the evidence  presented in the case and contested
                  this award in the United States  District  Court.  That motion
                  was denied on December 13, 1996, and the arbitration award was
                  confirmed.  The Company filed an appeal with the United States
                  Court of Appeals  for the Second  Circuit.  On  September  10,
                  1997,  the  Second  Circuit   affirmed  the  District  Court's
                  decision.  The  Company  is  planning  to seek  review  in the
                  Supreme Court of the United States, and has obtained a stay of
                  the judgment pending that application.



Item 6.     Exhibits and Reports on Form 8-K

            (a) Exhibit 27 - Financial Data Schedule.






















                                       10


<PAGE>


                                   SIGNATURES



         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
         the  registrant  has duly caused this report to be signed on its behalf
         by the undersigned thereunto duly authorized.











       Date:    December 12, 1997                   Toys "R" Us, Inc.
                                                    -----------------
                                                    (Registrant)





                                                    s/ Louis Lipschitz
                                                    (Signature)
                                                    Louis Lipschitz
                                                    Executive Vice President and
                                                    Chief Financial Officer















                                       11