Exhibit 10(iii)

                          AMENDMENT TO
                        CREDIT AGREEMENT


     THIS AMENDMENT TO CREDIT AGREEMENT is dated as of
August 25, 2000 (the "Amendment") and is among BANK OF AMERICA,
N.A., successor by merger to Nationsbank, N.A., a national banking
association (the "Bank"), FAMILY DOLLAR STORES, INC. ("FDSI") and
FAMILY DOLLAR, INC. ("FDI"; each of FDSI and FDI may be referred to
herein as a "Borrower" and collectively as the "Borrowers").


                        R E C I T A L S

     WHEREAS, the Borrowers and the Bank are parties to that
certain Credit Agreement dated as of March 31, 1996 (as amended,
modified or extended prior to the date hereof, the "Original
Agreement") providing for Tranche A Loans and Tranche B Loans in
an aggregate principal amount not to exceed $100,000,000;

     WHEREAS, the Borrowers have requested that the Bank amend
certain terms of the Original Agreement in accordance with the
terms of this Amendment;

     WHEREAS, the Bank has agreed to such amendment based on the
terms and conditions set forth herein.

                       A G R E E M E N T

     NOW, THEREFORE, in consideration of the premises and other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as
follows:

     1.  Section 6.06 of the Original Agreement is hereby deleted
in its entirety and replaced by the following:

         "[Intentionally Omitted]"

     2.  Representations and Warranties.  Each Borrower hereby
represents and warrants that (a) this Amendment has been duly
authorized, executed and delivered on its behalf, and the
Original Agreement, as amended hereby, constitutes its legal,
valid and binding obligation enforceable against it in accordance
with its terms; (b) the representations and warranties set forth
in Article V of the Original Agreement remain true and correct in
all material respects as of the date hereof with the same force
and effect as if made on and as of such date; and (c) no Default
or Event of Default as set forth in Article VII of the Original
Agreement has occurred and is continuing or will result from the
execution and delivery of this Amendment.

<PAGE>


     3.  No Other Amendments.  Except as modified hereby, all
other terms, conditions and provisions of the Original Agreement
shall remain in full force and effect.

     4.  Counterparts.  This Amendment may be executed in any
number of counterparts, each of which when executed and delivered
shall be deemed to be an original and it shall not be necessary
in making proof of this Amendment to produce or account for more
than one such counterpart.

     5.  Governing Law.  This Amendment shall be governed by, and
construed in accordance with, the laws of the State of North
Carolina.

                   [signature pages to follow]
<PAGE>


     IN WITNESS WHEREOF, each of the parties hereto has caused
this Amendment to be duly executed and delivered by its duly
authorized officer as of the date first above written.

                                   BANK OF AMERICA, N.A.

                                   By: TIMOTHY H. SPANOS
                                       TIMOTHY H. SPANOS
                                       Managing Director

ACKNOWLEDGED AND AGREED:

FAMILY DOLLAR STORES, INC.         FAMILY DOLLAR, INC.

By:    C. MARTIN SOWERS            By:    C. MARTIN SOWERS
Name:  C. MARTIN SOWERS            Name:  C. MARTIN SOWERS
Title: Senior Vice President-      Title: Senior Vice President-
       Finance                            Finance


Each of the Guarantors below acknowledges and consents to this
Amendment and ratifies its Guaranty:

Family Dollar Services, Inc.       Family Dollar Operations, Inc.

By:    C. MARTIN SOWERS            By:    C. MARTIN SOWERS
Name:  C. MARTIN SOWERS            Name:  C. MARTIN SOWERS
Title: Senior Vice President-      Title: Senior Vice President-
       Finance                            Finance


Family Dollar Trucking, Inc.

By:    C. MARTIN SOWERS
Name:  C. MARTIN SOWERS
Title: Senior Vice President-
       Finance