SECURITIES AND EXCHANGE COMMISSION
                                 Washington, D.C. 20549   
                                   
                                      FORM 10-Q      
                                   
     X              QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d)
                         OF THE SECURITIES EXCHANGE ACT OF 1934
                                   
                    For the quarterly period ended November 2, 1996
                                   
                    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 1-3339 
                                   
                             MERCANTILE STORES COMPANY, INC.
               (Exact name of registrant as specified in its charter)
                                                                 
                    Delaware                                   51-0032941
  (State or other jurisdiction of incorporation)            (I.R.S. Employer
                                                           Identification No.)
                                   
             9450 Seward Road Fairfield, Ohio                        45014
         (Address of principal executive offices)                  (Zip Code)
                          
     Registrant's telephone number, including area code:         (513) 881-8000
                                   
     Indicate by check mark whether the registrant  (1) has  filed all
     reports required to be filed by section 13 or 15(d) of the Securities
     Exchange Act of 1934 during the preceding 12 months (or for such shorter
     period that the registrant was required to file such reports), and (2)
     has been subject to such filing requirements for the past 90 days.
                                   
                    Yes  X    No   
                                   
     Indicate the number of shares outstanding of each of the issuer's classes
     of common stock, as of the latest practicable date.              
                                   
             36,844,050 shares of Common Stock at $.14 2/3 par value
                        as of December 3, 1996  
                              
      Total number of sequentially numbered pages in this filing, including
                        exhibits thereto: 11     
                                   


                                        -1-            

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                          MERCANTILE STORES COMPANY, INC.    
                              AND SUBSIDIARY COMPANIES      
                                        
                                    FORM 10-Q           
                                       
                                     INDEX                    
                                        
                                        
          PART I - FINANCIAL INFORMATION                    
                                        
             Item 1 - Financial Statements:
                                        
                  Consolidated Condensed Balance Sheets -
                      November 2, 1996 and February 3, 1996               3
                                        
                  Consolidated Condensed Statements of
                      Income - For the thirteen and thirty-nine weeks     
                      ended November 2, 1996 and October 28, 1995         4
                                        
                 Consolidated Condensed Statements of
                       Cash Flows - For the thirty-nine weeks         
                       ended November 2, 1996 and October 28, 1995        5
                                        
                  Notes to Consolidated Condensed Financial
                       Statements                                     6 - 7
                                                      
                                        
             Item 2 - Management's Discussion and Analysis of
                        Results of Operations and Financial
                        Condition                                    8 - 10
                                        
                                        
          PART II - OTHER INFORMATION                                      
                                        
             Item 4 - Submission of Matters to a Vote of       
                         Security Holders                                11
                                        
                                        
             Item 6 - Exhibits and Reports on Form 8-K                   11





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              MERCANTILE STORES COMPANY, INC. AND SUBSIDIARY COMPANIES
                       CONSOLIDATED CONDENSED BALANCE SHEETS   
                                  (in thousands)           
                                        
                                                  November 2,    February 3,
                                                     1996           1996
     Assets                                      ____________    __________
                                        
     Current Assets:                    
       Cash and cash equivalents             $      57,340    $     161,893
       Receivables:                          
          Customer, net                            526,373          559,544
          Other                                     12,816           15,078
       Inventories                                 707,166          523,573
       Other current assets                         23,258           26,296
                                              ------------      ------------   
         Total Current Assets                    1,326,953        1,286,384
                                        
     Prepaid Pension & Other Noncurrent
         Assets                                     94,710           87,107
                                        
     Property and Equipment, net                   729,817          701,233
                                              ------------     ------------
         Total Assets                         $  2,151,480     $  2,074,724
                                              ============     ============
                                        
     Liabilities and Stockholders' Equity                  
                                        
     Current Liabilities:                         
       Accounts payable                        $   201,307     $    106,645
       Notes payable and current maturities                 
          of long-term debt                         25 942            6,147
       Accrued income taxes                         22,211           40,533
       Taxes other than income                      30,123           21,352
       Accrued payroll                              27,987           28,585
       Other current liabilities                    54,797           69,546
                                               -----------      -----------
         Total Current Liabilities                 362,367          272,808
                                        
     Long-term Debt                                230,899          254,926
                                        
     Other Long-term Liabilities                    55,573           61,877
                                        
     Stockholders' Equity                        1,502,641        1,485,113
                                        
         Total Liabilities & Stockholders'    ------------     ------------
            Equity                            $  2,151,480     $  2,074,724
                                              ============     ============

        The accompanying notes are an integral part of these balance sheets.    

                                        -3-               

<PAGE>
<TABLE>
                 MERCANTILE STORES COMPANY, INC. AND SUBSIDIARY COMPANIES
                        CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                          (in thousands, except per share data) 

<CAPTION>                                                       
                                               Thirteen Weeks Ended            Thirty-Nine Weeks Ended
                                             November 2,    October 28,        November 2,   October 28,
                                                1996           1995                1996          1995
<S>                                       <C>             <C>                  <C>           <C>                                    
Revenues                                  $     727,741    $   694,765         $ 2,042,677   $ 1,940,071
                                                            
Cost of goods sold (including occupancy
 and central buying expenses)                   495,379        470,813           1,416,275     1,366,736
                                          -------------    -----------         -----------   -----------             
    Gross Profit                                232,362        223,952             626,402       573,335
                                          -------------    -----------         -----------   ----------- 
Expenses and Other Income:                                                                               

  Selling, general and 
     administrative expenses                    180,814        173,859             517,177       499,276
                                                            
  Interest expense, net                           2,387          3,265               7,023        11,179

  Other income                                   (2,590)        (1,792)             (7,659)      (13,128)
                                                            
  Impairment charge                                -              -                 12,000          - 
                                          -------------    -----------         -----------   -----------
                                                180,611        175,332             528,541       497,327

Income before Provision
    for Income Taxes                             51,751         48,620              97,861        76,008

Provision for income taxes                       20,663         19,410              39,068        30,344
                                          -------------    -----------         -----------   -----------
Net Income                                $      31,088    $    29,210         $    58,793   $    45,664
                                          =============    ===========         ===========   ===========  

Net Income Per Share (based on            -------------    -----------         -----------   -----------
  36,844,050 shares outstanding)          $         .85    $       .79         $      1.60   $      1.24
                                          =============    ===========         ===========   ===========

                                          -------------    -----------         -----------   -----------
Dividends Declared Per Share              $         .57    $       .53         $      1.12   $      1.05
                                          =============    ===========         ===========   ===========

            The accompanying notes are an integral part of these statements.



                                       - 4 -        
</TABLE>
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              MERCANTILE STORES COMPANY, INC. AND SUBSIDIARY COMPANIES
                   CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                   (in thousands)     
                                        
                                                    Thirty-Nine Weeks Ended
                                                   November 2,    October 28
                                                       1996          1995
Cash Flows From Operating Activities:
Net Income                                       $    58,793    $     45,664

Adjustments to reconcile net income to net
Depreciation and amortization                         61,346          65,082
Deferred income taxes                                 (4,671)         (3,429)
Impairment charge                                     12,000            -
Equity in unremitted earnings of affiliated companies    299             296
  Net pension benefit                                 (8,856)        (10,995)
  Change in inventories                             (183,593)       (215,528)
  Change in accounts receivable                       35,433          92,775
  Change in accounts payable                          94,662          91,962
  Net change in other working capital items          (32,744)        (11,987)
                                                  -----------     -----------   
Net cash provided by operating activities             32,669          53,840
                                                  -----------     -----------
Cash Flows From Investing Activities:                       
  Cash payments for property and equipment          (101,891)        (56,007)
  Net change in other noncurrent assets
     and liabilities                                    (335)             67
                                                  -----------      ----------
Net cash used in investing activities               (102,226)        (55,940)
                                                  -----------      ----------
Cash Flows From Financing Activities:                       
  Payments of notes payable and long-term debt        (4,232)         (4,249)
  Dividends paid                                     (30,764)        (28,922)
                                                  -----------       ---------
Net cash used in financing activities                (34,996)        (33,171)
                                                  -----------       ---------
Net decrease in cash and cash equivalents           (104,553)        (35,271)
Beginning cash and cash equivalents                  161,893         114,237
                                                 -----------     -----------
Ending cash and cash equivalents                 $    57,340     $    78,966
                                                 ===========     ============
Supplemental Cash Flow Information:                         
  Interest paid                                   $   18,516      $   19,441
  Income taxes paid                               $   62,912      $   47,310
                                        
                                        
          The accompanying notes are an integral part of these statements.
                                        
                                        -5-    
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             MERCANTILE STORES COMPANY, INC. AND SUBSIDIARY COMPANIES
               NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

1.   Nature of Operations
     Mercantile Stores Company, Inc. (the Company) is a conventional department
     store retailer engaged in the general merchandising business. The Company
     operates 102 department stores and four specialty stores under 13 different
     names in a total of 17 states.  The stores are located in 53 different
     markets within these states.  A subsidiary, Mercantile Credit Corp.,
     headquartered in Baton Rouge, Louisiana, provides servicing for the
     Company's private label credit program.  In addition to its department
     store and credit operations, the Company maintains a partnership interest
     in five operating shopping center ventures and one land ownership venture.

2.   Accounting Policies
     The consolidated condensed financial statements included herein have been
     prepared by the Company, without audit, pursuant to the rules and
     regulations of the Securities and Exchange Commission with respect to
     Form 10-Q.  Certain information and footnote disclosures normally included
     in financial statements prepared in accordance with generally accepted
     accounting principles have been condensed or omitted pursuant to such rules
     and regulations, although the Company believes that the disclosures made
     herein are adequate to make the information not misleading.  It is
     suggested that these consolidated condensed financial statements be read
     in conjunction with the financial statements and the notes thereto included
     in the Company's latest annual report on Form 10-K.

     Interim statements are subject to possible adjustments in connection with
     the annual audit of the Company's accounts for the full fiscal year 1996.
     In the Company's opinion, all adjustments (consisting only of normal
     recurring adjustments) necessary for fair statement presentation have been
     included.

     Because of seasonality, the results of operations for the periods
     presented are not necessarily indicative of the results expected for the
     year ending February 1, 1997.

3.   Revenues
     Revenues include sales from retail operations, leased departments and
     finance charge revenue earned on customer accounts serviced by the Company
     under its private label credit program. Finance charge revenue from the
     Company's private label credit program is recognize period in which it is
     earned.  Finance charge revenue for the 1996 third quarter and nine month
     periods ending November 2, 1996 amounted to $20 million and $63 million,
     respectively, compared to $21 million and $25 million, respectively,  for
     the 1995 third quarter and nine month periods.  Prior to August 1, 1995,
     the Company had in place an agreement whereunder a bank serviced
     substantially all of its private label credit program and under that
     arrangement the Company's share of finance charge income was classified
     as a component of other income. 
    

                                       - 6 -
<PAGE>                                



          MERCANTILE STORES COMPANY, INC. AND SUBSIDIARY COMPANIES
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                
                                  (Continued)

4.   Short-term Investments
     Short-term investments which have a maturity of ninety days or less are
     considered cash equivalents.

5.   Customer Receivables
     Customer receivables are classified as current assets and, consistent with
     industry practice, include some amounts which are due after one year.
     Customer receivables at November 2, 1996 and February 3, 1996 are net of
     an allowance for doubtful accounts of $16.6 million and $16.5 million,
     respectively.

6.   Merchandise Inventories
     All retail inventories are valued by the retail method and stated on the
     last-in, first-out (LIFO) basis which is lower than market.  Since
     inventories under the LIFO method are based on an annual determination of
     quantities and costs, the inventories at interim periods are based on 
     certain estimates relating to quantities and costs as of the fiscal
     year-end.

7.   Impairment Charge
     During the first quarter of 1996, the Company adopted Statement of
     Financial Accounting Standards (SFAS) No. 121, "Accounting for the
     Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed
     of," which addresses the identification and measurement of asset
     impairments and requires the recognition of impairment losses on long-lived
     assets when carrying values exceed expected future cash flows.  The
     Company evalusted investment in long-lived assets on an individual store
     basis.  Based upon an assessment of historical and projected operating
     results, it was determined that the carrying value of certain operating
     stores was impaired under the criteria defined in SFAS No. 121.  As a
     result, the Company recorded a pre-tax impairment charge of $12 million
     (a net of tax impact of $7.2 million, or $.20 per share) to write down the
     carrying value of these assets to their estimated fair value.  The fair
     value of these assets was based on operating projections and discounted
     future cash flows.
    

    
                                       - 7 -
<PAGE>

                                
             MERCANTILE STORES COMPANY, INC. AND SUBSIDIARY COMPANIES
          MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
                             AND FINANCIAL CONDITION
                                
Material Changes in the Results of Operations for the Third Quarter and Nine
Month Periods of 1996 Compared to the Third Quarter and Nine Month Periods of
1995.

Revenues increased by 4.7% to $728 million in the 1996 third quarter and by
5.3% to $2,043 million in the nine month period.  Sales from retail operations
were $707 million, a 4.9% increase from the 1995 third quarter and $1,980
million, a 3.4% increase over last year's nine month period. Sales in comparable
units also increased 4.9% in the quarter. Sales from four new units opened this
October essentially offset the sales which were lost from the two units which
were closed at the end of last year.  In the nine month period, comparable unit
sales increased 3.7%.  Finance charge revenue was relatively flat in the quarter
and increased to $63 million from $25 million in the nine month period. The
fluctuation in finance charge revenue in the nine month period was attributable
to changes in the servicing of the Company's private label credit program, as
discussed in Note 3 of Notes to Consolidated Condensed Financial Statements.

Cost of Goods Sold (COGS), as a percent to revenues, increased .3% in the 1996
third quarter to 68.1%.  For the nine month period, COGS decreased by 1.1% from
the comparable 1995 period to 69.3%.  Excluding the influence of finance charge
revenue, COGS, as a percent of retail sales, increased by .2% in both the 1996
third quarter and nine month periods.  Merchandise margins improved by .2% in
the quarter and .3% in the nine month period and were partially offset by a .1%
and .2% increase, respectively, in costs associated with lower margin leased
department sales (leased department sales increased by 10% in the third quarter
and 13% in the nine month period).  An increase in the estimated LIFO provision
also served to increase COGS by .3% in each period.

Selling, general and administrative expenses (SG&A), as a percent to revenues,
decreased .2% to 24.9% for the 1996 third quarter and .4% to 25.3% for the nine
month period.  Payroll and payroll related expenses decreased by .4% in the 1996
third quarter and were partially offset by a .2% increase in other operating 
expenses.  The decrease in the nine month period was attributable to a .3% 
reduction in payroll and related expenses coupled with a .1% reduction in
marketing expenses.  These ratios include the impact of expenses associated with
the new store openings which served to increase SG&A by .2% in the 1996 third
quarter and .1% in the nine month period.

Interest expense, net, decreased $.9 million and $4.1 million during the 1996
third quarter and nine month periods, respectively.  The decline in both periods
was primarily due to a combination of increased interest income earned on
higher levels of invested cash and higher levels of capitalized interest
attributable to new store construction.
                                 
Other income was essentially flat in the quarter and decreased $5.5 million in
the nine month period. The decline in the latter period was attributable to the
change in the servicing of the Company's private label credit program.  Prior
to August 1, 1995, the Company's share of finance charge revenue earned under
the servicing agreement with a bank was classified as a component of other
income.


                                     - 8 -

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              MERCANTILE STORES COMPANY, INC. AND SUBSIDIARY COMPANIES
            MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
                          AND FINANCIAL CONDITION

                                  (Continued)

Material Changes in the Results of Operations for the Third Quarter and Nine
Month Periods of 1996 Compared to the Third Quarter and Nine Month Periods of
1995.

During the first quarter of 1996, the Company adopted Statement of Financial
Accounting Standards No. 121, "Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to Be Disposed of," which addresses the
identification and measurement of asset impairments and requires the recognition
of impairment losses on long-lived assets when carrying values exceed expected
future cash flows.  The application of this new accounting standard resulted
in a pre-tax impairment charge of $12 million to write down the carrying value
of certain operating stores to their estimated fair value.


Material Changes in Financial Condition From February 3, 1996 to
November 2, 1996

The retail business is highly seasonal with approximately one-third of annual
sales being generated in the fourth quarter which encompasses the important
Christmas selling season.  As a result, significant variations can occur when
comparing financial conditions at the above dates.

The decrease of $104 million in cash and cash equivalents during the period was
attributable to the $102 million of payments for capital expenditures
(primarily for new store construction, as discussed on page 10) and $35 million
of requirements for financing activities.  These cash outflows were partially
offset by $33 million of cash generated by operations.

Net customer receivables decreased $33 million in the period due to the normal
pay down of peak year-end balances.

Inventories increased $184 million during the period primarily due to the normal
replenishment of inventory levels which are traditionally at their low point
at the fiscal year end and approximate peak levels by the end of third quarter.
Merchandise requirements for new stores (approximately $31 million) also
contributed to this increase.  The increase of $94 million in accounts payable
was significantly attributable to the increase in inventory levels.



                                   - 9 -
                                

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            MERCANTILE STORES COMPANY, INC. AND SUBSIDIARY COMPANIES
          MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
                            AND FINANCIAL CONDITION
                                
                                  (Continued)
                                
Material Changes in Financial Condition From February 3, 1996 to
November 2, 1996  

There have been no material changes in the Company's anticipated capital
expenditure requirements from those indicated in the 1995 Annual Report. 
During the 1996 third quarter, the Company opened four new stores; a 217,000
square foot Gayfers store in Orlando, Florida; a 186,000 square foot  J.B.
White store in Columbia, South Carolina; a 158,000 square foot J. B. White
store in Spartanburg, South Carolina (a new market for the Company); and a
212,000 square foot  McAlpin's store in Dayton, Ohio (also a new market for
the Company).  Additionally, in mid-November a 110,000 square foot Castner
Knott store was opened in Murfreesboro, Tennessee (a new market).  These new
store openings, which have added almost 900,000 square feet to the Company's
base, constitute the largest annual square footage addition (other than
acquisitions) in the Company's history.
 
The Company satisfies short-term financing needs primarily through internally
generated funds.  In addition, the Company has in place a committed, unsecured
$200 million revolving credit facility. This arrangement is with a consortium
of seven banks and expires in August, 2000.  When used, interest rates will be
based, at the Company's option, on either the banks' best rates under a 
competitive bid environment or a predefined spread over the LIBOR rate.  In
addition to this committed facility, the Company has available uncommitted lines
of credit totaling $20 million.  The Company maintained significant cash
balances throughout the first nine months of 1996 and it was not necessary to
use any of these credit arrangements during the period.





                                     - 10 -

<PAGE>


                   PART II - OTHER INFORMATION
                                
                                
Item  4 - Submission of Matters to a Vote of Security Holders 
                                
(a)   There were no matters submitted to a vote of security holders
           during the quarterly period ended November 2, 1996.
                                

                                
           Item 6 - Exhibits and reports on form 8-K
                                  
(a)  Exhibit 27 - Financial Data Schedule  (filed electronically).
                                           
                                                           
(b)  There were no reports on Form 8-K filed for the quarterly 
        period ended November 2, 1996.                                        
                                
                                
                              SIGNATURE 

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.
                                                   

                                                        
                         MERCANTILE STORES COMPANY, INC.              
                                  (Registrant)                       


       December 2, 1996                                              
            (Date)

                                           s/ James M. McVicker    
                                      (James M. McVicker, Senior Vice
                                        President, and Chief Financial
                                                 Officer)                
                                
                                
                                
                                
                                
                                
                                
                                       - 11 -