UNITED STATES
                  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 September 30, 1997
                                 or
    [ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                 SECURITIES EXCHANGE ACT OF 1934
         For the transition period from            to          
                                         ---------    ---------

                       US Airways Group, Inc.
                 (Commission file number: 1-8444)
                               and
                         US Airways, Inc.
                 (Commission file number: 1-8442)

    (Exact names of registrants as specified in their charters)


           Delaware             US Airways Group, Inc.  54-1194634
(State of incorporation         US Airways, Inc.        53-0218143
    of both registrants)  (I.R.S. Employer Identification Numbers)


                      US Airways Group, Inc.
           2345 Crystal Drive, Arlington, Virginia  22227
             (Address of principal executive offices)
                       (703) 872-5306
        (Registrant's telephone number, including area code)

                       US Airways, Inc.
           2345 Crystal Drive, Arlington, Virginia  22227
             (Address of principal executive offices)
                       (703) 872-7000
        (Registrant's telephone number, including area code)

     Indicate by check mark whether the registrants (1) have 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 registrants were required to file 
such reports), and (2) have been subject to such filing 
requirements for the past 90 days.

         Yes     X                           No      
               ----                                 ----
     As of October 31, 1997, there were outstanding approximately 
91,284,000 shares of common stock of US Airways Group, Inc. and 
1,000 shares of common stock of US Airways, Inc.

     The registrant US Airways, Inc. meets the conditions set 
forth in General Instructions H(1)(a) and (b) of Form 10-Q and is 
therefore participating in the filing of this form with the 
reduced disclosure format.

<PAGE>
                     US Airways Group, Inc.
                             and
                      US Airways, Inc.

                QUARTERLY REPORT ON FORM 10-Q


                     TABLE OF CONTENTS




PART I.   FINANCIAL INFORMATION                             Page
                                                            ----

Item 1A.  Financial Statements - US Airways Group, Inc.

     Condensed Consolidated Statements of Operations
       - Three Months and Nine Months Ended 
         September 30, 1997 and 1996                         1
     Condensed Consolidated Balance Sheets
       - September 30, 1997 and December 31, 1996            2
     Condensed Consolidated Statements of Cash Flows
       - Nine Months Ended September 30, 1997 and 1996       3
     Notes to Condensed Consolidated Financial Statements    4

Item 1B.  Financial Statements - US Airways, Inc.

     Condensed Consolidated Statements of Operations
       - Three Months and Nine Months Ended 
         September 30, 1997 and 1996                         9
     Condensed Consolidated Balance Sheets
       - September 30, 1997 and December 31, 1996            10
     Condensed Consolidated Statements of Cash Flows
       - Nine Months Ended September 30, 1997 and 1996       11
     Notes to Condensed Consolidated Financial Statements    12

Item 2.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations                 13

PART II.  OTHER INFORMATION

Item 1.  Legal Proceedings                                   29

Item 6.  Exhibits and Reports on Form 8-K                    29

SIGNATURES                                                   30


<TABLE>
                                            US Airways Group, Inc.
                             Condensed Consolidated Statements of Operations
              Three Months and Nine Months Ended September 30, 1997 and 1996 (unaudited)
                             (in thousands, except per share amounts)

<CAPTION>
                                              Three Months Ended       Nine Months Ended
                                                 September 30,          September 30,
                                            ---------------------   ---------------------
                                               1997        1996        1997        1996
                                               ----        ----        ----        ----
<S>                                        <C>         <C>         <C>         <C>
Operating Revenues
  Passenger transportation                 $1,917,119  $1,885,792  $5,825,937  $5,520,502
  Cargo and freight                            46,193      39,701     135,238     117,944
  Other                                       151,860     147,074     467,685     452,030
                                            ---------   ---------   ---------   ---------
    Total Operating Revenues                2,115,172   2,072,567   6,428,860   6,090,476

Operating Expenses
  Personnel costs                             763,718     810,282   2,306,347   2,351,826
  Aviation fuel                               193,970     207,360     617,054     588,133
  Commissions                                 151,047     147,088     460,846     440,225
  Aircraft rent                               124,715     116,378     359,432     321,641
  Other rent and landing fees                 116,218     105,839     315,905     311,539
  Aircraft maintenance                        126,748      75,446     328,502     265,903
  Depreciation and amortization               155,013      77,411     326,796     238,072
  Other, net                                  400,580     401,411   1,199,643   1,185,054
                                            ---------   ---------   ---------   ---------
    Total Operating Expenses                2,032,009   1,941,215   5,914,525   5,702,393
                                            ---------   ---------   ---------   ---------

    Operating Income                           83,163     131,352     514,335     388,083

Other Income (Expense)
  Interest income                              27,964      21,732      75,241      51,409
  Interest expense                            (63,957)    (66,456)   (192,642)   (201,409)
  Interest capitalized                          3,189       2,280       8,825       5,702
  Equity in earnings of affiliates              3,513       9,791      30,423      31,102
  Gains on sales of interests in affiliates   179,625           -     179,625           -
  Other, net                                   (1,743)    (19,486)     13,285     (20,091)
                                            ---------   ---------   ---------   ---------
    Other Income (Expense), Net               148,591     (52,139)    114,757    (133,287)
                                            ---------   ---------   ---------   ---------


Income Before Taxes                           231,754      79,213     629,092     254,796
Provision for Income Taxes                     44,724      11,475      83,818      18,576
                                            ---------   ---------   ---------   ---------

Net Income                                    187,030      67,738     545,274     236,220
Preferred Dividend Requirement                (10,612)    (22,338)    (54,983)    (67,134)
                                            ---------   ---------   ---------   ---------
Net Income Applicable to
  Common Stockholders                      $  176,418  $   45,400  $  490,291  $  169,086
                                            =========   =========   =========   =========
Income per Common Share
  Primary                                     $  2.04     $  0.69     $  6.48      $ 2.58
  Fully diluted                               $  1.82     $  0.60     $  5.18      $ 2.15

Shares Used for Computation
  Primary                                      86,685      65,838      75,620      65,457
  Fully diluted                               102,835      95,754     104,210      95,373


See accompanying Notes to Condensed Consolidated Financial Statements.





                                    (this space intentionally left blank)

                                                 1
</TABLE>
<PAGE>
<TABLE>
                                   US Airways Group, Inc.
                        Condensed Consolidated Balance Sheets
                 September 30, 1997(unaudited) and December 31, 1996
                  (dollars in thousands, except per share amount) 
<CAPTION>
                                                                September 30,   December 31,
                           ASSETS                                   1997           1996
                                                                ------------    -----------
<S>                                                              <C>            <C>
Current Assets
  Cash and cash equivalents                                      $ 1,224,411    $   950,966
  Short-term investments                                             857,068        635,839
  Receivables, net                                                   410,984        337,025
  Materials and supplies, net                                        223,458        248,774
  Prepaid expenses and other                                         121,271        137,590
                                                                   ---------      ---------
    Total Current Assets                                           2,837,192      2,310,194
Property and Equipment
  Flight equipment                                                 5,192,637      5,202,057
  Ground property and equipment                                    1,138,323      1,108,648
  Less accumulated depreciation and amortization                  (2,719,346)    (2,470,337)
                                                                   ---------      ---------
                                                                   3,611,614      3,840,368
  Purchase deposits                                                   89,420         77,620
                                                                   ---------      ---------
    Total Property and Equipment, Net                              3,701,034      3,917,988
Other Assets
  Goodwill, net                                                      476,936        494,511
  Other intangibles, net                                             264,919        283,309
  Investment in marketable equity securities                         192,196              -
  Other assets, net                                                  451,639        525,409
                                                                   ---------      ---------
    Total Other Assets                                             1,385,690      1,303,229
                                                                   ---------      ---------
                                                                 $ 7,923,916    $ 7,531,411
                                                                   =========      =========
     LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities
  Current maturities of long-term debt                           $   186,594    $    84,259
  Accounts payable                                                   434,973        438,951
  Traffic balances payable and unused tickets                        873,495        715,576
  Accrued aircraft rent                                              455,173        510,752
  Other accrued expenses                                             764,072      1,099,181
                                                                   ---------      ---------
    Total Current Liabilities                                      2,714,307      2,848,719
Long-Term Debt, Net of Current Maturities                          2,441,084      2,615,780
Deferred Credits and Other Liabilities
  Deferred gains, net                                                339,331        359,748
  Postretirement benefits other than pensions, noncurrent          1,149,164      1,093,519
  Noncurrent employee benefit liabilities and other                  659,837        439,308
                                                                   ---------      ---------
    Total Deferred Credits and Other Liabilities                   2,148,332      1,892,575
Commitments and Contingencies
Redeemable Cumulative Convertible Preferred Stock
  Series H, no par value, 358,000 shares issued and outstanding      358,000        358,000
  Series F, no par value, 30,000 shares issued and outstanding             -        300,000
    as of December 31, 1996
  Series T, no par value, 10,000 shares issued and outstanding             -        100,719
    as of December 31, 1996
Stockholders' Equity (Deficit)
  Series B cumulative convertible preferred stock,                         -        213,128
    no par value, 4,263,000 depositary shares issued
    and outstanding as of December 31, 1996
  Common stock, par value $1 per share, authorized                    91,119         64,306
    150,000,000 shares, issued and outstanding
    91,119,000 and  64,306,000 shares, respectively
  Paid-in capital                                                  1,887,830      1,386,557
  Retained earnings (deficit)                                     (1,751,011)    (2,117,838)
  Common stock held in treasury                                            -              -
  Deferred compensation                                              (87,114)       (95,326)
  Unrealized gain on available-for-sale securities, net
    of income tax effects                                            134,418              -
  Adjustment for minimum pension liability, net of
    income tax effects                                               (13,049)       (35,209)
                                                                   ---------      ---------
      Total Stockholders' Equity (Deficit)                           262,193       (584,382)
                                                                   ---------      ---------
                                                                 $ 7,923,916    $ 7,531,411
                                                                   =========      =========

See accompanying Notes to Condensed Consolidated Financial Statements.

                                                         2
</TABLE>
<PAGE>
<TABLE>
                                  US Airways Group, Inc.
                       Condensed Consolidated Statements of Cash Flows
                   Nine Months Ended September 30, 1997 and 1996 (unaudited)
                                    (in thousands)

<CAPTION>                                                                            1997        1996
                                                                                     ----        ----
<S>                                                                              <C>          <C>
Cash and cash equivalents beginning of period                                    $  950,966   $ 881,854
                                                                                  ---------     -------
Cash flows from operating activities
  Net income                                                                        545,274     236,220
  Adjustments to reconcile net income to net cash
    provided by (used for) operating activities
      Depreciation and amortization                                                 326,796     238,072
      Loss (gain) on disposition of property                                        (16,049)       (889)
      Gains on sales of interests in affiliates                                    (179,625)          -
      Amortization of deferred gains and credits                                    (20,765)    (20,749)
      Other                                                                          14,651      42,560
      Changes in certain assets and liabilities
        Decrease (increase) in receivables                                          (73,959)    (88,171)
        Decrease (increase) in materials and supplies, prepaid expenses
          and pension assets                                                         38,843     (42,453)
        Increase (decrease) in traffic balances payable and unused tickets          157,919     237,183
        Increase (decrease) in accounts payable, accrued
          aircraft rent and other accrued expenses                                 (179,484)      4,762
        Increase (decrease) in postretirement benefits other than 
          pensions, noncurrent                                                       55,645      61,065
                                                                                  ---------     -------
            Net cash provided by (used for) operating activities                    669,246     667,600

Cash flows from investing activities
  Aircraft acquisitions and purchase deposits, net                                  (19,219)    (37,231)
  Additions to other property                                                      (115,437)   (105,711)
  Proceeds from disposition of property                                              54,344      15,503
  Proceeds from sales of interests in affiliates                                    224,233           -
  Decrease (increase) in short-term investments                                    (222,800)   (603,983)
  Decrease (increase) in restricted cash and investments                             17,661      (2,347)
  Other                                                                               5,125     (10,821)
                                                                                  ---------     -------
           Net cash provided by (used for) investing activities                     (56,093)   (744,590)

Cash flows from financing activities
  Issuance of debt                                                                        -     103,002
  Reduction of debt                                                                 (72,361)   (211,942)
  Issuance of common stock                                                           30,495       2,523
  Sale of treasury stock                                                              1,031           -
  Redemption of preferred stock, including redemption premiums                     (126,485)          -
  Dividends paid on preferred stock                                                (172,388)    (43,000)
                                                                                  ---------     -------
           Net cash provided by (used for) financing activities                    (339,708)   (149,417)
                                                                                  ---------     -------
Net increase (decrease) in cash and cash equivalents                                273,445    (226,407)
                                                                                  ---------     -------
Cash and cash equivalents end of period                                          $1,224,411   $ 655,447
                                                                                  =========     =======
Noncash investing and financing activities
  Conversion of preferred stock into common stock                                $  496,550   $       -
  Unrealized gain on available-for-sale securities,  net of income tax effects   $  134,418   $       -
  Treasury stock acquired for tax withholding on employee stock grants           $    1,163   $       -
  Issuance of debt - refinancing of debt secured by aircraft                     $        -   $ 159,998
  Reduction of debt - refinancing of debt secured by aircraft                    $        -   $ 154,422
  Dividends declared on preferred stock, but not paid during period              $        -   $  40,000
  Issuance of debt - aircraft acquisitions                                       $        -   $  26,075
  Underwriter's fees - refinancing of debt secured by aircraft                   $        -   $   2,488

Supplemental Information
  Cash paid during the period for interest, net of amount capitalized            $  206,867   $ 219,270
  Net cash paid during the period for income taxes                               $   64,781   $   7,254

See accompanying Notes to Condensed Consolidated Financial Statements.


                                                        3
</TABLE>

<PAGE>
                       US AIRWAYS GROUP, INC.
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                           (UNAUDITED)


1.  BASIS OF PRESENTATION

     The accompanying Condensed Consolidated Financial Statements 
include the accounts of US Airways Group, Inc. ("US Airways Group" 
or the "Company") and its wholly-owned subsidiaries US Airways, 
Inc. ("US Airways"), Piedmont Airlines, Inc., PSA Airlines, Inc., 
Allegheny Airlines, Inc., US Airways Leasing and Sales, Inc., US 
Airways Fuel Corporation, Material Services Company, Inc. and The 
OR Group, Inc. ( "OR Group").

     OR Group was a wholly-owned subsidiary of US Airways Group 
that was incorporated in February 1996 and dissolved in the fourth 
quarter of 1996. OR Group provided resource allocation consulting 
services and decision-making support systems to US Airways, which 
assumed these activities upon OR Group's dissolution.

     US Airways terminated its Airline Technical Services, LLC 
joint venture with a subsidiary of British Airways Plc. ("British 
Airways") effective January 1997. No material charges resulted 
from its termination.

     Management believes that all adjustments necessary for a fair 
statement of results have been included in the Condensed 
Consolidated Financial Statements for the interim periods 
presented, which are unaudited. All significant intercompany 
accounts and transactions have been eliminated. 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 those estimates.

     Certain 1996 amounts have been reclassified to conform with 
1997 classifications.

     These interim period Condensed Consolidated Financial 
Statements should be read in conjunction with the Consolidated 
Financial Statements contained in the Company's Annual Report on 
Form 10-K for the year ended December 31, 1996.

2.  INCOME PER COMMON SHARE

     For the three months and nine months ended September 30, 
1997, approximately 2,685,000 incremental shares of Common Stock 
were included in the calculation of fully diluted income per 
common share as the result of applying the "treasury stock method" 
to outstanding stock options. For the three months ended September 
30, 1997, the effects of assuming conversion of the Series H 
Senior Cumulative Preferred Stock ("Series H Preferred Stock") and 
the Series B Preferred Stock (for shares that were outstanding 
prior to the conversion and redemption activity discussed in Note 
4(a)) were dilutive and therefore included in the calculation. For 
the nine months ended September 30, 1997, the effects of assuming 
conversion of the Company's outstanding preferred stock issuances 
(for shares that were outstanding prior to the repurchase, 
conversion and redemption activity discussed in Note 3 and Note 
4(a)) were dilutive and therefore included in the calculation, 
except for shares of Series F Preferred Stock which were 
repurchased in May 1997.

     For both the three months and nine months ended September 30, 
1997, the income effects of assuming conversion of dilutive 
preferred stock issuances were approximately $10,612,000 and 
$49,173,000, respectively. For the same periods, the share effects 
of assuming conversion of

                                  4
<PAGE>
dilutive preferred stock issuances were approximately 15,952,000 
and 27,953,000 shares, respectively.

3.  REDEEMABLE PREFERRED STOCK

     During August 1997, the Company exchanged its Series A 
Preferred Stock for Series H Preferred Stock. The Series A 
Preferred Stock was, and the Series H Preferred Stock is, owned by 
affiliates of Berkshire Hathaway, Inc. The provisions of the 
Series H Preferred Stock are substantially similar to those of the 
Series A Preferred Stock, with the following exceptions: The 
Series H Preferred Stock cannot be redeemed before March 15, 1998; 
the early redemption premium has been increased from $100 per 
share to $150 (as with the Series A Preferred Stock, the Series H 
Preferred Stock is mandatorily redeemable on August 7, 1999); and 
certain changes have been made to provisions related to sales of 
Series H Preferred Stock other than to US Airways Group. This 
exchange transaction facilitated the redemption of the Series B 
Preferred Stock (see Note 4(a)).

     On May 21, 1997, British Airways converted 28,059.364 shares 
of Series F Preferred Stock into 14,458,851 shares of Common 
Stock, which it then sold to third parties. On May 22, 1997, the 
Company repurchased the remaining outstanding shares of Series F 
Preferred Stock and all of the Series T Preferred Stock (both 
series were held exclusively by British Airways) for $126.2 
million (which included a premium over the stated amount of $5.2 
million for the shares of Series F Preferred Stock repurchased and 
$0.8 million for the Series T Preferred Stock). The Company's 
board of directors declared regular quarterly dividends on the 
Series F and Series T Preferred Stock prior to the conversion and 
repurchase transactions. As of May 22, 1997, the Company believes 
British Airways held no ownership interest in US Airways Group.

     During the first nine months of 1997, the Company paid 
dividends totaling $116.4 million on its Series A, Series H, 
Series F and Series T Preferred Stock (see Note 7 to the Company's 
Annual Report on Form 10-K for the year ended December 31, 1996 
for a description of each series, except for the Series H 
Preferred Stock which is discussed above), including payment of 
all dividends in arrears.

4.  STOCKHOLDERS' EQUITY

     (a)  SERIES B PREFERRED STOCK

     On April 17, 1997, the Company paid dividends of $46.6 
million on its publicly-held Series B Preferred Stock. With that 
payment, the Company had paid all dividends in arrears on its 
Series B Preferred Stock. The Company paid regular quarterly 
dividends of $4.7 million on its Series B Preferred Stock on May 
15, 1997 and August 15, 1997.

     During August 1997, the Company notified the holders of its 
Series B Preferred Stock that it would redeem all outstanding 
depositary shares representing Series B Preferred Stock on 
September 15, 1997 at $51.75 per depositary share plus accrued 
dividends of $0.3646 per depositary share. Because conversion was 
financially advantageous to the holders, all but approximately 
6,000 depositary shares were converted into Common Stock prior to 
the redemption date resulting in the issuance of approximately 
10.6 million shares of Common Stock.

     (b)  UNREALIZED GAIN ON AVAILABLE-FOR-SALE SECURITIES, NET OF
          INCOME TAX EFFECTS

     In accordance with Statement of Financial Accounting 
Standards No. 115, "Accounting for Certain Investments in Debt and 
Equity Securities" ("SFAS 115"), the Company recognizes an 
adjustment to Stockholders' Equity to reflect differences between 
the fair value of investments in marketable equity securities and 
short-term investments (both types of investments are considered

                                  5
<PAGE>
"available-for-sale" under SFAS 115) and their respective carrying 
values at each balance sheet date. Any adjustment is recognized 
net of estimated income taxes.

     (c)  ADJUSTMENT FOR MINIMUM PENSION LIABILITY, NET OF INCOME
          TAX EFFECTS

     In conjunction with the annual valuation of US Airways' 
defined benefit plans, the Company recorded an Adjustment for 
minimum pension liability as of September 30, 1997. The provisions 
of Statement of Financial Accounting Standards No. 87, "Employers' 
Accounting for Pensions," require the recognition of an additional 
minimum pension liability for each defined benefit plan for which 
the accumulated benefit obligation exceeds plan assets. This 
amount has been recognized by the Company as a liability with an 
offsetting intangible asset. Because the intangible asset 
recognized may not exceed the amount of unrecognized prior service 
cost on an individual plan basis, the balance is reported as a 
separate adjustment to Stockholders' Equity, net of income tax 
effects.

5.  BRITISH AIRWAYS INVESTMENT

     As discussed in Note 3, "Redeemable Preferred Stock," the 
Company believes that British Airways held no ownership interest 
in US Airways Group as of May 22, 1997. As of December 31, 1996, 
the preferred stock held by British Airways represented 
approximately 23% of the total voting interest in the Company.

6.  USAM INVESTMENTS

     Prior to the events described below, USAM Corp. ("USAM"), a 
wholly-owned subsidiary of US Airways, owned 11% of the Galileo 
International Partnership ("GIP"), approximately 11% of the 
Galileo Japan Partnership ("GJP") and approximately 21% of the 
Apollo Travel Services Partnership ("ATS"). The following is 
summarized financial information for these partnerships (combined, 
in millions):

                      Three Months Ended     Nine Months Ended
                         September 30,          September 30,
                         1997 *  1996           1997 *    1996
                         ----    ----           ----      ----
                          (Unaudited)             (Unaudited)
  Service revenues       $140    $375           $969     $1,126
  Cost and expenses       112     308            758        908
                          ---     ---            ---      -----
    Net earnings         $ 28    $ 67           $211     $  218
                          ===     ===            ===      =====

  *USAM discontinued using the equity method of accounting for
   its investments in GIP and ATS on July 30, 1997 (see below).

     On July 30, 1997, Galileo International, Inc. ("Galileo") 
completed an initial public offering ("IPO") and used the 
proceeds, together with the proceeds of bank financing, to 
purchase ATS. Immediately preceding the IPO, GIP was merged with 
and into a wholly-owned limited liability company subsidiary of 
Galileo and USAM received shares in Galileo in the same proportion 
as its partnership interest in GIP. As part of the IPO, USAM sold 
some of its Galileo shares and its interest in Galileo was reduced 
from 11% to approximately 6.7%. USAM received proceeds of $62.2 
million and recognized a pre-tax gain of approximately $50 million 
from the sell-down of its interest in Galileo and received 
proceeds of $162.0 million and recognized a pre-tax gain of 
approximately $130 million in connection with the ATS sale.

     USAM applies the provisions of Statement of Financial 
Accounting Standards No. 115, "Accounting for Certain Investments 
in Debt and Equity Securities," to account for its remaining 
investment in Galileo, which is classified as available-for-sale.

                                  6
<PAGE>
     USAM received distributions from GIP, GJP and ATS of $12.7 
million, $0.2 million and $4.6 million, respectively, during the 
first nine months of 1997. USAM received distributions from GIP, 
GJP and ATS of $2.8 million, $0.1 million and $41.9 million 
(including a special distribution from ATS of $33.7 million during 
the second quarter of 1996), respectively, during the first nine 
months of 1996.

7.  NONRECURRING ITEMS

     During the second quarter of 1997, US Airways reversed $1.5 
million of previously accrued lease obligations upon subleasing an 
additional British Aerospace BAe-146-200 aircraft (recorded as a 
credit to Aircraft rent expense). 

     US Airways also recognized nonrecurring expenses totaling 
$28.3 million during the second quarter of 1997 related to 
efficiency measures announced during May 1997: $6.9 million 
recorded in Personnel costs related to estimated employee 
severance payments; $2.9 million recorded in Other rent and 
landing fees related primarily to the write-off of lease 
obligations at certain facilities to be abandoned (net of any 
anticipated sublease revenues); and $18.5 million recorded in 
Depreciation and amortization related primarily to the write-down 
of certain McDonnell Douglas DC-9-30 ("DC-9") aircraft to 
estimated fair value. The efficiency measures include grounding of 
22 excess aircraft, including five Fokker F28-4000 and 17 DC-9 
aircraft (all of the F28-4000 aircraft and eleven of the DC-9 
aircraft had been retired as of September 30, 1997), ending 
unprofitable jet service to nine cities and eliminating other 
routes that have not been profitable (completed during early 
September 1997) and closing a flight crew base (by February 1998), 
two reservations centers (October 1997) and three maintenance 
facilities (by December 1998).

     The Company recognized additional nonrecurring expenses 
totaling $72.3 million during the third quarter of 1997 including 
$59.3 million recorded in Depreciation and amortization resulting 
from US Airways' late-September 1997 decision to retire its 
remaining DC-9 aircraft over the next several years. The remaining 
nonrecurring expenses recognized during the third quarter of 1997, 
$11.3 million recorded in Depreciation and amortization and $1.7 
million recorded in Other rent and landing fees, include the 
write-down of certain equipment to be disposed of as a result of 
the May 1997 efficiency measures and certain other adjustments to 
the second quarter 1997 charges.

     In addition, as discussed in Note 6, "USAM Investments," USAM 
recognized a pre-tax gain of $179.6 million which resulted from 
its sale of certain investments.

8.  SUBSEQUENT EVENTS

     On October 31, 1997, US Airways' pilots ratified a new five 
year labor contract. The new contract includes, among other terms 
and conditions, no pre-determined guaranteed increases to hourly 
rates of pay, certain work rule changes and allowing US Airways to 
establish a low cost, low fare product. US Airways believes that 
this new contract will help it to reduce its unit operating costs, 
which are currently the highest of all major domestic air 
carriers.

     On October 31, 1997, the Company entered into agreements with 
AVSA, S.A.R.L. ("AVSA"), an affiliate of aircraft manufacturer 
Airbus Industrie G.I.E. ("Airbus"), and CFM International Inc. 
("CFMI") for the acquisition of up to 400 Airbus A320 family 
aircraft and accompanying jet engines. The A320 family aircraft 
are single-aisle "narrowbody" aircraft which include the Airbus 
A319, A320 and A321. 

     The Company has 124 aircraft on firm order, 116 aircraft 
subject to reconfirmation prior to scheduled delivery and options 
for 160 additional aircraft. Of the first 124 aircraft six are 
scheduled for delivery in 1998, 20 in 1999 and 98 in the years 
2000 through 2002. The Company anticipates

                                  7
<PAGE>
that the new Airbus aircraft will ultimately replace, at a 
minimum, US Airways' DC-9-30, MD-80 and B737-200 aircraft.

     The minimum determinable payments associated with the 
Company's agreements with AVSA and CFMI (including progress 
payments, payments at delivery, buyer-furnished equipment, spares, 
capitalized interest, penalty payments, cancellation fees and/or 
nonrefundable deposits) are currently estimated at $92 million 
during the fourth quarter of 1997, $261 million in 1998, $701 
million in 1999, $1.06 billion in 2000 and $212 million in 2001.

     As previously disclosed, US Airways has been in discussions 
with The Boeing Company ("Boeing") and Rolls Royce Plc. concerning 
certain agreements to purchase eight B757-200 aircraft and 40 
B737-Series aircraft. On September 11, 1997, Boeing filed suit 
against US Airways in state court in King County, Washington, 
alleging among other things, that US Airways had breached these 
aircraft purchase agreements. The lawsuit seeks, among other 
things, monetary damages of an unspecified amount. On October 31, 
1997, US Airways filed an answer and counterclaim to Boeing's 
complaint denying liability and seeking recovery from Boeing of 
approximately $45 million in equipment purchase deposits and past 
overcharges.

     US Airways intends to vigorously defend the Boeing lawsuit. 
US Airways cannot predict the outcome of the lawsuit or whether US 
Airways' financial condition or results of operations would be 
materially affected as a result of the lawsuit.
















                 (this space intentionally left blank)










                                  8

<PAGE>
<TABLE>
                                      US Airways, Inc.
                      Condensed Consolidated Statements of Operations
        Three Months and Nine Months Ended September 30, 1997 and 1996 (unaudited)
                                      (in thousands)

<CAPTION>
                                              Three Months Ended      Nine Months Ended
                                                 September 30,           September 30,
                                              ------------------      ------------------
                                               1997        1996        1997        1996
                                              ------      ------      ------      ------
<S>                                        <C>         <C>         <C>         <C>
Operating Revenues
  Passenger transportation                 $1,767,554  $1,739,074  $5,377,365  $5,093,175
  Cargo and freight                            45,174      38,671     132,126     115,066
  US Airways Express transportation revenues  150,986           -     452,453           -
  Other                                       151,596     146,312     452,186     449,028
                                            ---------   ---------   ---------   ---------
    Total Operating Revenues                2,115,310   1,924,057   6,414,130   5,657,269

Operating Expenses
  Personnel costs                             722,232     771,279   2,182,859   2,237,314
  Aviation fuel                               183,401     196,197     583,852     557,037
  Commissions                                 140,477     137,090     429,327     410,854
  Aircraft rent                               109,938     103,009     315,184     285,931
  Other rent and landing fees                 111,549     101,263     301,842     298,417
  Aircraft maintenance                        109,297      62,099     279,615     222,710
  Depreciation and amortization               150,999      73,511     315,138     226,508
  US Airways Express capacity purchases       122,486           -     364,946           -
  Other, net                                  379,879     382,842   1,123,237   1,124,074
                                            ---------   ---------   ---------   ---------
    Total Operating Expenses                2,030,258   1,827,290   5,896,000   5,362,845
                                            ---------   ---------   ---------   ---------
    Operating Income                           85,052      96,767     518,130     294,424

Other Income (Expense)
  Interest income                              29,754      22,041      77,253      51,522
  Interest expense                            (64,471)    (71,255)   (196,637)   (213,323)
  Interest capitalized                          3,189       2,280       8,825       5,702
  Equity in earnings of affiliates              3,513       9,791      30,423      31,102
  Gains on sales of interests in affiliates   179,625           -     179,625           -
  Other, net                                   (1,718)    (19,931)     13,436     (20,302)
                                            ---------   ---------   ---------   ---------
    Other Income (Expense), Net               149,892     (57,074)    112,925    (145,299)
                                            ---------   ---------   ---------   ---------

Income Before Taxes                           234,944      39,693     631,055     149,125
Provision for Income Taxes                     48,038      11,646      98,734      15,440
                                            ---------   ---------   ---------   ---------

Net Income                                 $  186,906  $   28,047  $  532,321  $  133,685
                                            =========   =========   =========   =========


See accompanying Notes to Condensed Consolidated Financial Statements.

                                             9
</TABLE>


<PAGE>
<TABLE>
                                      US Airways, Inc.
                            Condensed Consolidated Balance Sheets
                   September 30, 1997 (unaudited) and December 31, 1996
                      (dollars in thousands, except per share amount)

<CAPTION>
                                                              September 30,   December 31,
                                                                  1997            1996
                                                                 ------          ------
        ASSETS
<S>                                                           <C>             <C>
Current Assets
  Cash and cash equivalents                                   $1,223,761      $  950,134
  Short-term investments                                         857,068         635,839
  Receivables, net                                               409,223         325,478
  Receivables from related parties, net                           44,201               -
  Materials and supplies, net                                    192,191         211,184
  Prepaid expenses and other                                     115,241         129,380
                                                               ---------       ---------
    Total  Current Assets                                      2,841,685       2,252,015
Property and Equipment
  Flight equipment                                             4,966,628       4,972,873
  Ground property and equipment                                1,112,906       1,087,178
  Less accumulated depreciation and amortization              (2,624,118)     (2,381,844)
                                                               ---------       ---------
                                                               3,455,416       3,678,207
  Purchase deposits                                               89,420          77,620
                                                               ---------       ---------
    Total Property and Equipment, Net                          3,544,836       3,755,827
Other Assets
  Goodwill, net                                                  476,936         494,511
  Other intangibles, net                                         264,890         283,274
  Investment in marketable equity securities                     192,196               -
  Other assets, net                                              529,429         606,906
                                                               ---------       ---------
    Total Other Assets                                         1,463,451       1,384,691
                                                               ---------       ---------
                                                              $7,849,972      $7,392,533
                                                               =========       =========

        LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT)
Current Liabilities
  Current maturities of long-term debt                        $  186,501      $   84,171
  Accounts payable                                               416,463         420,388
  Payable to related parties, net                                      -         193,860
  Traffic balances payable and unused tickets                    873,495         715,576
  Accrued aircraft rent                                          445,885         495,662
  Other accrued expenses                                         751,952       1,073,773
                                                               ---------       ---------
    Total Current Liabilities                                  2,674,296       2,983,430
Long-Term Debt, Net of Current Maturities                      2,440,193       2,614,818
Deferred Credits and Other Liabilities
  Deferred gains, net                                            336,775         356,583
  Postretirement benefits other than pensions, noncurrent      1,148,914       1,093,269
  Noncurrent employee benefit liabilities and other              646,050         429,588
                                                               ---------       ---------
    Total Deferred Credits and Other Liabilities               2,131,739       1,879,440
Commitments and Contingencies
Stockholder's Equity (Deficit)
  Common stock, par value $1 per share, authorized
    1,000 shares, issued and outstanding 1,000 shares                  1               1
  Paid-in capital                                              2,416,131       2,416,131
  Retained earnings (deficit)                                 (1,933,757)     (2,466,078)
  Unrealized gain on available-for-sale securities, net
    of income tax effects                                        134,418               -
  Adjustment for minimum pension liability, net
    of income tax effects                                        (13,049)        (35,209)
                                                               ---------       ---------
      Total Stockholder's Equity (Deficit)                       603,744         (85,155)
                                                               ---------       ---------
                                                              $7,849,972      $7,392,533
                                                               =========       =========


See accompanying Notes to Condensed Consolidated Financial Statements.

                                            10
</TABLE>


<PAGE>
<TABLE>
                                      US Airways, Inc.
                       Condensed Consolidated Statements of Cash Flows
                   Nine Months Ended September 30, 1997 and 1996 (unaudited)
                                       (in thousands)
<CAPTION>
                                                                                   1997           1996
                                                                                ---------      ---------
<S>                                                                            <C>            <C>
Cash and cash equivalents beginning of period                                  $  950,134     $  879,613
                                                                                ---------      ---------
Cash flows from operating activities
  Net income                                                                      532,321        133,685
  Adjustments to reconcile net income to net
    cash provided by (used for) operating activities
      Depreciation and amortization                                               315,138        226,508
      Loss (gain) on disposition of property                                      (15,846)          (373)
      Gains on sales of interests in affiliates                                  (179,625)             -
      Amortization of deferred gains and credits                                  (19,808)       (19,809)
      Other                                                                         7,877         21,708
      Changes in certain assets and liabilities
        Decrease (increase) in receivables                                       (127,946)       (85,993)
        Decrease (increase) in materials and supplies, prepaid expenses
          and pension assets                                                       31,503        (32,445)
        Increase (decrease) in traffic balances payable and unused tickets        157,919        245,487
        Increase (decrease) in accounts payable, accrued
          aircraft rent and other accrued expenses                               (359,282)        70,782
        Increase (decrease) in postretirement benefits other than
          pensions, noncurrent                                                     55,645         61,065
                                                                                ---------      ---------
            Net cash provided by (used for) operating activities                  397,896        620,615

Cash flows from investing activities
  Aircraft acquisitions and purchase deposits, net                                (19,219)       (37,231)
  Additions to other property                                                    (108,709)      (101,211)
  Proceeds from disposition of property                                            51,735         14,748
  Proceeds from sales of interests in affiliates                                  224,233              -
  Decrease (increase) in short-term investments                                  (222,800)      (603,983)
  Decrease (increase) in restricted cash and investments                           17,661         (2,347)
  Payment of debt for affiliated company                                                -        (42,830)
  Other                                                                             5,125        (10,490)
                                                                                ---------      ---------
            Net cash provided by (used for) investing activities                  (51,974)      (783,344)

Cash flows from financing activities
  Issuance of debt                                                                      -        103,002
  Reduction of debt                                                               (72,295)      (165,993)
                                                                                ---------      ---------
            Net cash provided by (used for) financing activities                  (72,295)       (62,991)
                                                                                ---------      ---------

Net increase (decrease) in cash and cash equivalents                              273,627       (225,720)
                                                                                ---------      ---------

Cash and cash equivalents end of period                                        $1,223,761     $  653,893
                                                                                =========      =========


Noncash investing and financing activities
  Unrealized gain on available-for-sale securities, net of 
    income tax effects                                                         $  134,418     $        -
  Issuance of debt - refinancing of debt secured by aircraft                   $        -     $  159,998
  Reduction of debt - refinancing of debt secured by aircraft                  $        -     $  154,422
  Reduction of parent company debt - aircraft acquisitions                     $        -     $   68,640
  Issuance of debt - aircraft acquisitions                                     $        -     $   26,075
  Underwriter's fees - refinancing of debt secured by aircraft                 $        -     $    2,488

Supplemental Information
  Cash paid during the period for interest, net of amount capitalized          $  206,803     $  216,360
  Net cash paid during the period for income taxes                             $   64,671     $    6,042


See accompanying Notes to Condensed Consolidated Financial Statements.

                                            11
</TABLE>

<PAGE>
                         US AIRWAYS, INC.
           NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                          (UNAUDITED)


1.  BASIS OF PRESENTATION

     The accompanying Condensed Consolidated Financial Statements 
include the accounts of US Airways, Inc. ("US Airways") and its 
wholly-owned subsidiary USAM Corp. ("USAM"). US Airways is a 
wholly-owned subsidiary of US Airways Group, Inc. ("US Airways 
Group").

     US Airways terminated its Airline Technical Services, LLC 
joint venture with a subsidiary of British Airways Plc. effective 
January 1997. No material charges resulted from its termination.

     Management believes that all adjustments necessary for a fair 
statement of results have been included in the Condensed 
Consolidated Financial Statements for the interim periods 
presented, which are unaudited. All significant intercompany 
accounts and transactions have been eliminated. 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 those estimates.

     Certain 1996 amounts have been reclassified to conform with 
1997 classifications.

     These interim period Condensed Consolidated Financial 
Statements should be read in conjunction with the Consolidated 
Financial Statements contained in US Airways' Annual Report on 
Form 10-K for the year ended December 31, 1996.

2.  UNREALIZED GAIN ON AVAILABLE-FOR-SALE SECURITIES, NET OF
    INCOME TAX EFFECTS

     Please refer to Note 4(b) in US Airways Group's "Notes to 
Condensed Consolidated Financial Statements" on Page 5 of this 
report.

3.  ADJUSTMENT FOR MINIMUM PENSION LIABILITY, NET OF INCOME TAX
    EFFECTS

    Please refer to Note 4(c) in US Airways Group's "Notes to 
Condensed Consolidated Financial Statements" on Page 6 of this 
report.

4.  USAM INVESTMENTS

     Please refer to Note 6 in US Airways Group's "Notes to 
Condensed Consolidated Financial Statements" on Page 6 of this 
report.

5.  NONRECURRING ITEMS

     Please refer to Note 7 in US Airways Group's "Notes to 
Condensed Consolidated Financial Statements" on Page 7 of this 
report.

6.  SUBSEQUENT EVENTS

     Please refer to Note 8 in US Airways Group's "Notes to 
Condensed Consolidated Financial Statements" on Page 7 of this 
report.

                                  12
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
        AND RESULTS OF OPERATIONS.

                                GENERAL

     Part I, Item 2 of this report should be read in conjunction 
with Part II, Item 7 of US Airways Group, Inc.'s ("US Airways 
Group" or the "Company") and US Airways, Inc.'s ("US Airways") 
Annual Report to the United States Securities and Exchange 
Commission ("SEC") on Form 10-K for the year ended December 31, 
1996. The information contained herein is not a comprehensive 
management overview and analysis of the financial condition and 
results of operations of the Company and US Airways, but rather 
updates disclosures made in the aforementioned filing.

     Certain information contained herein should be considered 
"forward-looking information" which is subject to a number of 
risks and uncertainties. The preparation of forward-looking 
information requires the use of estimates of future revenues, 
expenses, activity levels and economic and market conditions, many 
of which are outside the Company's control. Among the specific 
factors that could cause actual results to differ materially from 
those set forth in the forward-looking information are the 
following: economic conditions, labor costs, aviation fuel costs, 
competitive pressures from lower cost competition, weather 
conditions, government legislation, consumer perceptions of the 
Company's products, demand for air transportation in the markets 
in which the Company operates and other risks and uncertainties 
listed from time to time in the Company's reports to the SEC. 
Other factors and assumptions not identified above are also 
involved in the preparation of forward-looking information, and 
the failure of such other factors and assumptions to be realized 
may also cause actual results to differ materially from those 
discussed. The Company assumes no obligation to update such 
estimates to reflect actual results, changes in assumptions or 
changes in other factors affecting such estimates.

     Except where noted, the following discussion relates 
primarily to the financial condition, results of operations and 
future prospects of US Airways. US Airways is the Company's 
principal subsidiary, accounting for approximately 92% of the 
Company's operating revenues for the first nine months of 1997 (on 
a consolidated basis). US Airways' financial results include the 
financial results of its wholly-owned subsidiary USAM Corp. 
("USAM").

                         FINANCIAL OVERVIEW

     For the third quarter of 1997, the Company's operating 
revenues were $2.12 billion, operating income was $83.2 million, 
net income was $187.0 million and income per common share (or 
"EPS") was $2.04 on a primary basis and $1.82 on a fully diluted 
basis (the Company's Condensed Consolidated Statements of 
Operations are contained in Part I, Item 1A of this report. See 
Note 2 in Notes to Condensed Consolidated Financial Statements, 
which are also contained in Part I, Item 1A of this report, and 
Exhibit 11 to this report for additional information related to 
EPS). For the first nine months of 1997, operating revenues were 
$6.43 billion, operating income was $514.3 million, net income was 
$545.3 million and EPS was $6.48 on a primary basis and $5.18 on a 
fully diluted basis. The Company's financial results for the third 
quarter and first nine months of 1997 include pre-tax gains 
totaling $179.6 million which resulted from USAM's sale of certain 
investments (as discussed under "USAM Investments" below) as well 
as certain nonrecurring items. See "Results of Operations" below 
for additional information related to the Company's results of 
operations, including nonrecurring items.

               PILOTS RATIFY NEW LABOR CONTRACT
 
     On October 31, 1997, US Airways' pilots ratified a new five 
year labor contract. This new contract, along with the Company's 
agreements to acquire new aircraft and jet engines (see

                                  13

"Affirmation of Airbus Order" below) are of paramount importance 
to the Company's future, particularly with respect to ensuring 
competitiveness and long-term financial viability. 

Provisions of US Airways' new contract with its pilots include:

*  No pre-determined guaranteed increases to hourly rates of pay 
for "mainline" operations for existing aircraft types and new 
Airbus aircraft through the term of the contract. Reviews must be 
completed by January 1 of the years 2001, 2002 and 2003 to 
determine what adjustments (increases or decreases), if any, must 
be made to rates of pay and/or work rules so that US Airways' 
pilot costs (pay and productivity) are at parity plus 1% as 
compared to a weighted average of mainline pilot costs at American 
Airlines, Inc. ("American"), Delta Air Lines, Inc. ("Delta"), 
Northwest Airlines, Inc. ("Northwest") and United Airlines, Inc. 
("United"). At the option of the pilots, an additional "Interim 
Review" may be undertaken for completion by January 1, 1999. 
*  Allowing US Airways to establish a "low cost, low fare" product 
to compete with Southwest Airlines, Inc. ("Southwest"), Delta's 
Delta Express product, AirTran Airlines Inc. ("AirTran," whose 
operations now include those of the former ValuJet Airlines, Inc.) 
and other such competitors in certain markets and under certain 
conditions. US Airways' low cost, low fare product can begin 
service with up to 54 aircraft with the flexibility, under certain 
circumstances, to expand its operations up to 25% of US Airways' 
total system block hours. Pay rates for pilots on US Airways' low 
cost, low fare product will be comparable to those of Southwest's 
pilots (with pay protection for mainline pilots involuntarily 
displaced to US Airways' low cost, low fare product ending when 
such pilots have the ability to return to mainline operations).
*  Work rule changes including reductions in sick leave and 
vacation liabilities which are estimated to result in significant 
annual savings when fully implemented.
*  Allowing the Company's commuter air carriers to operate up to 
the greater of 35 regional jet aircraft or the equivalent of 9% of 
US Airways' operating fleet, once all pilots are recalled from 
furlough.
*  A commitment to grow at an annual rate the greater of 2.5% (as 
measured by system block hours) or 20% above the average block 
hour growth rate of American, Delta, Northwest and United subject 
to certain deferral rights and force majeure provisions.
*  Lump sum payments to pilots equal to 1% of annual salary for 
the calendar years 1999, 2001 and 2002,  payable in the subsequent 
calendar year.
*  11.5 million options to purchase US Airways Group Common Stock, 
to be issued ratably to pilots over the five-year life of the 
contract, with exercise prices established based on the fair 
market value of the Company's Common Stock over a time period 
proceeding each grant date.
*  An early retirement program for up to 325 pilots and the recall 
from furlough by December 15, 1997 of 100 pilots furloughed in 
1997, as well as offering recall by December 31, 2001 of 283 
additional pilots furloughed prior to 1997.
*  A requirement for US Airways to operate certain levels of 
transoceanic block hours before increasing international code-
sharing.
*  Certain change of control protections, including cash payments 
to pilots of up to $250 million under certain circumstances if US 
Airways is acquired and is not the surviving entity and the 
pilots' labor contract is adversely affected as a result of the 
acquisition.
*  Certain job security provisions, including a "no furlough" 
clause for pilots on the seniority list on the effective date of 
the agreement.

     US Airways currently estimates that the early retirement 
program will result in a nonrecurring charge of approximately $115 
million in accordance with the provisions of Financial Accounting 
Standards Board ("FASB") Statement of Financial Accounting 
Standards ("SFAS") No. 88, "Employers' Accounting for Settlements 
and Curtailments of Defined Benefit Pension Plans and for 
Termination Benefits" ("SFAS 88"). This charge would be recognized 
in Personnel costs during the second quarter of 1998, when the 
number of pilots who opt for early retirement is expected to be 
established. US Airways expects to realize significant net long-
term savings in both wages and 

                                  14
<PAGE>
benefits expenses as a result of the early retirement program. US 
Airways will recognize expenses for the lump sum payments, 
approximately $20 million, in Personnel costs ratably through 
December 31, 2002. Any Personnel cost expenses associated with the 
stock options granted under the new contract would be recognized 
over the vesting period of the grant and be dependent upon the 
exercise price of each grant.

     US Airways continues negotiations with the International 
Association of Machinists and Aerospace Workers ("IAM"), which 
represents US Airways' mechanical and related personnel, and the 
Association of Flight Attendants ("AFA"), which represents US 
Airways' flight attendants. US Airways has opened negotiations 
with the IAM for fleet service employees and will soon begin 
negotiations with the Communication Workers of America ("CWA") for 
passenger service employees with respect to initial contracts for 
both employee groups (see also "Other Information" below).

                   AFFIRMATION OF AIRBUS ORDER

     On October 31, 1997, the Company entered into agreements with 
AVSA, S.A.R.L. ("AVSA"), an affiliate of aircraft manufacturer 
Airbus Industrie G.I.E. ("Airbus"), and CFM International Inc. 
("CFMI") for the acquisition of up to 400 Airbus A320 family 
aircraft and accompanying jet engines. The A320 family aircraft 
are single-aisle "narrowbody" aircraft which include the Airbus 
A319, A320 and A321. As part of the agreement with CFMI, GE Engine 
Services, Inc. will provide maintenance for the engines under a 
20-year agreement.

     The Company has 124 aircraft on firm order, 116 aircraft 
subject to reconfirmation prior to scheduled delivery and options 
for 160 additional aircraft. Of the first 124 aircraft six are 
scheduled for delivery in 1998, 20 in 1999 and 98 in the years 
2000 through 2002. The Company anticipates that the new Airbus 
aircraft will ultimately replace, at a minimum, US Airways' DC-9-
30, MD-80 and B737-200 aircraft. See related information under 
"Liquidity and Capital Resources" below.

     The Airbus aircraft are more efficient, less costly to 
maintain and provide certain customer service benefits over the 
aircraft they are intended to replace. However, certain operating 
costs such as Depreciation and amortization and Aircraft rent are 
likely to increase in conjunction with the higher ownership and/or 
rental costs associated with the new aircraft. In addition, US 
Airways may be required to recognize an "impairment charge" 
related to aircraft to be retired, as defined in FASB SFAS No. 
121, "Accounting for the Impairment of Long-Lived Assets and Long-
Lived Assets to Be Disposed Of" ("SFAS 121"). US Airways is 
currently unable to determine the amount of such a charge, if any, 
because certain information required for the analysis is currently 
undetermined (e.g., aircraft retirement dates). See also "Results 
of Operations: Nonrecurring items" below for additional 
information regarding SFAS 121.

            UPDATE ON US AIRWAYS' COMPETITIVE POSITION

     US Airways' primary competitive threat continues to be the 
growth of low cost, low fare competition in its primary operating 
region, the Eastern United States. US Airways' estimated 
origin/destination passenger overlap with low cost, low fare 
competition was approximately 49% of its passenger base as of 
October 1997 as compared to approximately 50% as of April 1997. 
This slight decrease is due to schedule changes by US Airways, 
which eliminated some affected markets (see "Efficiency Measures" 
below), offset by continued growth of low cost, low fare 
competition in the Eastern U.S.

     During October 1997, the U.S. Department of Transportation 
("DOT") awarded several low cost, low fare air carriers takeoff 
and landing rights ("slots") at New York's LaGuardia Airport 
("LaGuardia") and at Chicago's O'Hare International Airport. The 
DOT awarded the slots as part of new policies designed to increase 
competition at certain high-traffic domestic airports.

                                  15
<PAGE>
Previously, slots at such airports (which also include New York's 
John F. Kennedy International Airport and Washington National 
Airport ("National")) were restricted by government regulation and 
were only available through purchase or lease from another air 
carrier. US Airways has a considerable number of slots at such 
airports, primarily at LaGuardia and National. The recent awards 
were minimal and are not expected to have a material adverse 
impact on the Company's results of operations and financial 
condition. 

     There are several proposals before Congress which would  
address service to small and medium-size airports. Most notable is 
a bill which would, among other things, confiscate slots from the 
major air carriers at the four high-density airports mentioned in 
the preceding paragraph and auction them off to new entrant air 
carriers. US Airways has testified in opposition to such a plan. 
Adoption of such a plan could force a reduction in US Airways' 
flights from LaGuardia and National to certain communities on the 
East Coast and could have an adverse effect on the Company's 
results of operations and financial position.

    Direct competition with low cost, low fare air carriers or 
operations has typically resulted in the dilution of yield 
realized by the Company's airline subsidiaries, depending on the 
number of markets affected. In addition, US Airways continues to 
have the highest unit operating cost (operating cost per ASM or 
"cost per ASM") of all domestic air carriers. US Airways' cost per 
ASM was 12.27 cents for the third quarter of 1997. By contrast, 
Southwest and AirTran reported unit operating costs for the same 
period of 7.36 cents and 8.11 cents, respectively. Delta Express' 
unit operating cost is purported to be approximately 7.50 cents. 
However, as discussed above, US Airways' new labor contract with 
its pilots establishes the groundwork for US Airways to launch a 
cost competitive answer to low cost, low fare competition. US 
Airways' new product, which may include a new brand identity and 
style of service, is expected to be launched in early 1998. 
Although a route system for the new product is currently being 
developed, Baltimore/Washington International Airport ("BWI") is 
expected to play a major role. 

     US Airways continues to evaluate other measures through which 
it can improve its competitiveness and fulfill its strategic 
objectives. One of the Company's primary strategic objectives is 
to expand the breadth of US Airways' operations on an 
international scale and establish US Airways as a global airline 
of choice. US Airways has recently undertaken steps to realize 
this objective including announcing plans to build a new 
international terminal and a new US Airways Express terminal at 
Philadelphia International Airport. Other actions may include 
purchasing the US Airways Shuttle (see "US Airways Shuttle" below) 
and creating a Midwestern hub. The Company is examining 
alternatives for widebody aircraft to support its growing 
international operations and is currently discussing the 
acquisition of widebody aircraft with both Airbus and Boeing.

     US Airways' added a second daily non-stop flight between 
Philadelphia and Paris on June 14, 1997 and will begin twice-daily 
service between Philadelphia and London's Gatwick Airport on April 
1, 1998. US Airways has filed with the DOT to serve London through 
Gatwick from Boston, Charlotte and Pittsburgh with the intent of 
transferring Gatwick operations to London's Heathrow Airport 
("Heathrow") at the earliest opportunity. Service at Heathrow is 
currently restricted by the bilateral aviation agreement between 
the U.S. and the United Kingdom. US Airways has also filed with 
the DOT and French authorities to serve Paris through Charles de 
Gaulle Airport from Pittsburgh and is currently seeking the proper 
authorizations to initiate service between Philadelphia and Milan. 
During October 1997, US Airways discontinued service between 
Boston and Frankfurt.

                      EFFICIENCY MEASURES

     During May 1997, US Airways announced certain "efficiency 
measures" including: Retiring 22 aircraft from its operating 
fleet, including the last five Fokker F28-4000 ("F28-4000") 
aircraft and

                                  16
<PAGE>
17 older DC-9 aircraft (all of the F28-4000 aircraft and eleven of 
the DC-9 aircraft had been retired as of September 30, 1997); 
ending unprofitable service to nine cities and eliminating other 
routes that have not been profitable (completed during early 
September 1997); reducing capacity (ASMs) by approximately 6.5% by 
Summer 1998; and closing a flight crew base (by February 1998), 
two reservations centers (October 1997) and three maintenance 
facilities (by December 1998).

     The Company recognized nonrecurring charges during the second 
quarter of 1997 as a result of these actions. In late September 
1997, US Airways decided to retire its remaining DC-9 aircraft 
earlier than previously planned resulting in an additional 
nonrecurring charge (nonrecurring charges are discussed under 
"Results of Operations: Nonrecurring items," below). Excluding any 
SFAS 121 charges (see "Affirmation of Airbus Order" above), US 
Airways anticipates that deliveries of new Airbus aircraft will 
mitigate the effects of DC-9 retirements on its financial results 
and capacity.

     The Company has been working closely with union leaders and 
employee groups to minimize to the greatest degree possible the 
impact of changes in operations on affected employees. The Company 
expects these efficiency measures will ultimately result in the 
furlough of approximately 850 US Airways employees. See "Update on 
US Airways' Competitive Position" for information related to US 
Airways' strategic direction.

     US Airways moved a majority of its international operations 
at BWI to Philadelphia effective June 15, 1997. These schedule 
adjustments were made to further enhance the efficiency of US 
Airways' route network and take advantage of the traffic base and 
connection opportunities provided by US Airways' facilities at 
Philadelphia, US Airways' primary international gateway. These 
schedule adjustments resulted in the elimination of approximately 
240 full-time and part-time customer service and maintenance 
positions at BWI. However, as mentioned above, BWI is expected to 
play a major role in the launch of US Airways' new low cost 
operation.

    RESUMPTION OF REGULAR DIVIDEND PAYMENTS ON PREFERRED STOCK,
 BRITISH AIRWAYS' DIVESTITURE AND CALL OF SERIES B PREFERRED STOCK

     On March 26, 1997, the Company paid dividends totaling $34.8 
million to the holders of its Series A, Series F and Series T 
Preferred Stock and the Company's board of directors declared 
dividends of $46.6 million on the Company's Series B Preferred 
Stock (see Note 7 and Note 8 to the Company's Annual Report on 
Form 10-K for the year ended December 31, 1996 for a description 
of each of the Company's preferred stock issuances). After payment 
of the Series B Preferred Stock dividends during May 1997, the 
Company had paid all dividends in arrears (including penalty 
dividends on the deferred dividends) and had resumed regular 
quarterly dividend payments on all of its outstanding preferred 
stock issuances. 

     During May 1997, British Airways Plc. ("British Airways") 
converted 28,059.364 shares of Series F Preferred Stock into 
14,458,851 shares of Common Stock, which it then sold to third 
parties. Also during May 1997, the Company repurchased the 
remaining shares of Series F Preferred Stock and all of the Series 
T Preferred Stock (both series were held exclusively by British 
Airways). The Company's board of directors declared regular 
quarterly dividends on the Series F and Series T Preferred Stock 
prior to the conversion and repurchase transactions. After the 
conversion and repurchase transactions, the Company believes that 
British Airways held no ownership interest in US Airways Group 
(see also "Liquidity and Capital Resources" below).

     During August 1997, the Company exchanged its Series A 
Preferred Stock for Series H Cumulative Convertible Preferred 
Stock ("Series H Preferred Stock"). The Series A Preferred Stock 
was, and the Series H Preferred Stock is, owned by affiliates of 
Berkshire Hathaway, Inc. ("Berkshire Hathaway"). The provisions of 
the Series H Preferred Stock are substantially similar to those of 
the Series A Preferred Stock (see Note 3 to the Company's 
Condensed Consolidated

                                  17
<PAGE>
Financial Statements for additional information). The exchange 
transaction facilitated the redemption of the Series B Preferred 
Stock (as discussed below). 

     On August 18, 1997, the Company notified the holders of its 
Series B Preferred Stock that it would redeem all outstanding 
depositary shares representing Series B Preferred Stock on 
September 15, 1997 at $51.75 per share plus accrued dividends of 
$0.3646 per share. Because conversion was financially advantageous 
to the holders, all but approximately 6,000 depositary shares were 
converted into Common Stock prior to the redemption date resulting 
in the issuance of approximately 10.6 million shares of Common 
Stock (see also "Liquidity and Capital Resources" below).

     With the retirement of the Series B, Series F and Series T 
Preferred Stock, the Company's annual preferred stock dividend 
burden has been reduced by approximately $46 million. Future 
dividend payments by the Company are primarily dependent on the 
Company's future financial performance and decisions by its board 
of directors. There can be no assurance that the Company's current 
positive financial performance will continue or if the Company 
will be able to maintain a capital surplus position based on its 
balance sheet, as defined under the laws of the State of Delaware.

     Sections 382 and 383 of the Internal Revenue Code and the 
regulations thereunder impose limitations on the utilization of 
net operating loss and credit carryforwards if a corporation has 
had a "change of control" as defined therein. Generally, a change 
of control occurs if the corporation experiences more than a 50% 
ownership change over a rolling three year testing period. In 
general, if a corporation has a change of control, the amount of 
loss carryforwards and credits that can be used in any subsequent 
year are limited to an amount equal to the product of the value of 
the corporation's stock immediately prior to the change multiplied 
by the "long-term tax exempt rate," as defined by the U.S. 
Internal Revenue Service. The Company does not believe it 
experienced a change of control before the British Airways and 
Series B Preferred Stock transactions discussed above, nor does it 
believe that those transactions caused a change of control. As of 
December 31, 1996 the Company had approximately $1.5 billion 
unused net operating loss carryforward, $375 million alternative 
net operating loss carryforward, $50 million of investment tax 
credits, and $33 million alternative minimum tax credits. The 
Company expects to use a significant portion of these 
carryforwards during 1997. The Company will also review whether 
and to what extent it is appropriate to continue to apply a 
valuation allowance to its deferred tax assets in accordance with 
SFAS No. 109, "Accounting for Income Taxes," and any change in the 
valuation allowance could differ materially from that recorded as 
of December 31, 1996.

                      USAM INVESTMENTS
 
     On July 30, 1997, Galileo International, Inc. ("Galileo") 
completed an initial public offering ("IPO") and used the 
proceeds, together with the proceeds of bank financing, to 
purchase Apollo Travel Services Partnership ("ATS"). USAM owned 
approximately 21% of ATS. Immediately preceding the IPO, Galileo 
International Partnership ("GIP") was merged with and into a 
wholly-owned limited liability company subsidiary of Galileo and 
USAM received shares in Galileo in the same proportion as its 
partnership interest in GIP. As part of the IPO, USAM sold some of 
its Galileo shares and its interest in Galileo was reduced from 
11% to approximately 6.7%. USAM received proceeds of $62.2 million 
and recognized a pre-tax gain of approximately $50 million from 
the sell-down of its interest in Galileo and received proceeds of 
$162.0 million and recognized a pre-tax gain of approximately $130 
million in connection with the ATS sale.

     USAM applies the provisions of SFAS No. 115, "Accounting for 
Certain Investments in Debt and Equity Securities," to account for 
its remaining investment in Galileo. The resulting adjustment to 
Stockholders' Equity to reflect the increase in the fair value of 
USAM's Galileo investment over its carrying cost is reflected in 
the Company's balance sheet line item Unrealized gain on 
available-for-

                                18
<PAGE>
sale securities, net of income tax effects (see also Note 4(c) to 
the Company's Condensed Consolidated Financial Statements).   

                          US AIRWAYS SHUTTLE

     On March 31, 1997, the Company exercised its right to 
commence a procedure to value Shuttle, Inc. ("Shuttle"), the owner 
of the US Airways Shuttle, in accordance with the agreement 
between the Company, lenders to Shuttle and Shuttle's stockholders 
(the "Valuation Procedure"). Culminating the Valuation Procedure, 
an independent appraiser has provided to the Company, lenders to 
Shuttle and Shuttle's stockholders its determination of Shuttle's 
value. The Company has until November 22, 1997 to commit to 
purchase Shuttle at this amount. However, if the Company declines 
to purchase Shuttle at this amount, it will continue to have a 
right of first refusal with respect to any other agreement to 
purchase the assets or capital stock of Shuttle. Any decision by 
the Company to purchase Shuttle either through the Valuation 
Procedure or the right of first refusal will be made based on 
prices and related business considerations.

     The US Airways Shuttle currently operates a fleet of 12 
Boeing 727-200 aircraft and provides high frequency service from 
New York to Boston and Washington, DC.

                     OTHER INFORMATION

     US Airways has signed a letter of intent with The SABRE 
Group, Inc. ("Sabre") to manage US Airways' information 
technology. The agreement, which would span 25 years, envisions 
Sabre purchasing US Airways' computer equipment and proprietary 
software. In return, US Airways would have access to Sabre 
technology and expertise in areas such as reservations, passenger 
check-in, aircraft and crew scheduling, yield management and 
electronic ticketing. Approximately 875 US Airways information 
services employees would be offered jobs with Sabre or otherwise 
leave US Airways' employment. Sabre would also be responsible for 
ensuring that US Airways' information systems are year 2000 
compliant. The proposed arrangement would result in reduced 
Personnel costs and higher Other operating expenses. US Airways 
expects to finalize this agreement by the end of 1997.

     During October 1997, electronic ticketing sales for travel on 
US Airways and its regional affiliates reached 20% of all ticket 
sales. Also during October 1997, US Airways expanded electronic 
ticketing to include travel between the U.S. and Canada. The 
Company, whose "E-ticket" program was launched in April 1996, 
believes that electronic ticketing reduces distribution costs.

     On September 29, 1997, US Airways' passenger service 
employees, approximately 9,200 employees, voted for representation 
by CWA. This election was a re-run election mandated by the 
National Mediation Board ("NMB"). In January 1997, US Airways 
passenger service employees voted against unionization, but the 
NMB subsequently ordered that a new representation election be 
held for these employees because of alleged interference by US 
Airways with the election process. US Airways has filed an action 
challenging this order in federal court.

     On September 24, 1997, US Airways announced that it has 
reduced the rates for base commissions paid to travel agencies 
from 10% of ticket price to 8% on all domestic and international 
tickets issued by travel agents in U.S., Puerto Rico, the U.S. 
Virgin Islands and Canada. US Airways' existing maximum payment of 
$25 one-way and $50 round-trip for tickets purchased in the U.S. 
and Puerto Rico for travel in and between the U.S., Puerto Rico 
the U.S. Virgin Islands and Canada remains unchanged.

     On August 5, 1997, President Clinton signed legislation 
extending federal excise taxes on air transportation ("ticket 
tax") from October 1, 1997 through September 30, 2007. In 
addition, effective October 1, 1997, the legislation reduced the 
domestic ticket tax from the prior level of

                                  19
<PAGE>
10% of fare to 9.0% (decreasing to 8.0% on October 1, 1998 and to 
7.5% on October 1, 1999), added a new segment tax of $1.00 (which 
increases to $3.00 by the year 2002), changed the current $6.00 
international departure tax to $12.00 and added a $12.00 
international arrival tax. The legislation also added a new 7.5% 
tax effective October 1, 1997 on certain purchases of frequent 
traveler program miles from domestic air carriers. The Company 
does not believe that the new ticket tax structure will have a 
material adverse effect on its liquidity, financial condition or 
results of operations.

     The Federal Aviation Administration has proposed new 
regulations that would require certain commercial passenger 
aircraft to have cargo hold fire detection/suppression systems. 
The proposed regulations, subject to DOT approval, would affect US 
Airways' Boeing 737-Series, DC-9 and MD-80 aircraft (the other 
aircraft types in US Airways' operating fleet already have such 
systems). US Airways estimates that compliance with the proposal, 
as currently drafted, would cost approximately $22 million over 
the recommended three-year phase-in period. The Company is unable 
to predict whether or when the proposed regulations will be 
adopted or if any such regulations, if adopted, would differ 
materially from the current proposed regulations.

RESULTS OF OPERATIONS

     The following section includes information related to changes 
in certain line items in the Company's Condensed Consolidated 
Statements of Operations and in select US Airways operating and 
financial statistics. Except where noted, statistics referred to 
below in the comparisons of financial results are for scheduled 
service only.

            THREE MONTH PERIOD ENDED SEPTEMBER 30, 1997
                         COMPARED WITH THE
           THREE MONTH PERIOD ENDED SEPTEMBER 30, 1996

Operating Revenues (see also "Select US Airways Operating and 
Financial Statistics" below):

Passenger Transportation-US Airways' Passenger transportation 
revenues increased $28.5 million, or 1.6%, as the result of a 7.2% 
increase in revenue passenger miles ("RPMs") offset by the effects 
of a 5.2% decrease in yield. The Company estimates that inclement 
weather (hurricanes) during the third quarter of 1996 adversely 
affected Passenger transportation revenues by approximately $10 
million.

Cargo and Freight-Increased due primarily to increased volume, 
including the effects of the August 1997 labor strike at United 
Parcel Service of America, Inc.

Other Operating Revenues-The largest factor contributing to the 
increase is higher revenues from partners in US Airways' Dividend 
Miles program. Changes in other components of Other operating 
revenues are largely offset by correlating changes in operating 
expenses, primarily those recorded as Other, net. US Airways' 
results include certain transactions with related parties that are 
eliminated at the US Airways Group level.

     US Airways' Operating Revenues include the line item "US 
Airways Express transportation revenues." Effective October 1, 
1996, US Airways began purchasing all of the capacity (ASMs) 
generated by the Company's three wholly-owned regional air 
carriers and, concurrently, recognizing the passenger 
transportation revenues that result from passengers being carried 
by these companies. The rate per ASM that US Airways pays is based 
on estimates of the costs incurred to produce the capacity. The 
program is designed to reflect the reality of US Airways' 
relationship with the Company's regional airline subsidiaries-US 
Airways controls the markets these air carriers operate in, the 
marketing programs and the fares charged. US Airways' revenues 
from this program

                                  20
<PAGE>
are reclassified to Passenger transportation revenues and the 
related expenses eliminated during the consolidation of the 
Company's results of operations.

Operating Expenses (see also "Pilots Ratify New Labor Contract" 
and "Affirmation of Airbus Order" above):

Nonrecurring Items-The Company recognized nonrecurring items 
during the second and third quarters of 1997. The table below 
shows where these nonrecurring items were recorded in the 
Company's Condensed Consolidated Statements of Operations (dollars 
in millions; brackets indicate an expense).

                                                  1997
                                    ----------------------------
                                   Second     Third     Year-to
                                   Quarter    Quarter     Date
                                   -------    -------    -------
Operating Expenses
   Personnel costs                $  (6.9)   $    -       $(6.9)
   Aircraft rent                      1.5         -         1.5
   Other rent and landing fees       (2.9)     (1.7)       (4.6)
   Depreciation and amortization    (18.5)    (70.6)      (89.1)
                                     ----      ----        ----
                                    (26.8)    (72.3)      (99.1)
                                     ----      ----        ----
Other Income (Expense)
   Gains on sales of interests
     in affiliates                      -     179.6       179.6
                                     ----     -----       -----
                                        -     179.6       179.6
                                     ----     -----       -----
Net amount reflected in Income
  Before Taxes                    $(26.8)    $107.3       $80.5
                                    ====      =====        ====

     The second quarter charges relate primarily to the efficiency 
measures announced during May 1997, as discussed above under 
"Efficiency Measures." The second quarter charges also include a 
$1.5 million credit to Aircraft rent upon US Airways' subleasing 
an additional British Aerospace BAe-146-200 ("BAe-146") aircraft. 
The $2.9 million charge to Other rent and landing fees reflects 
the accrual of lease obligations at certain facilities 
abandoned/to be abandoned (net of any anticipated sublease 
revenues) as the result of the May 1997 efficiency measures; the 
$1.7 million charge to Other rent and landing fees recognized 
during third quarter 1997 is an adjustment of the second quarter 
facilities-related charge. 

     A majority of the Depreciation and amortization charges in 
both quarters stem from analyses performed in accordance with the 
provisions of SFAS 121. In general, SFAS 121 requires an 
impairment charge to be recognized when the net undiscounted 
future cash flows from an asset's use (including any anticipated 
proceeds from disposition) are less than the asset's current book 
value and the asset's current book value exceeds its fair value. 
The impairment charge reflects writing-down the assets to fair 
value. $18.1 million of the second quarter charge is an impairment 
charge associated with retiring 17 DC-9 aircraft as the result of 
the May 1997 efficiency measures and $59.3 million of the third 
quarter charge is an impairment charge resulting from US Airways' 
late-September 1997 decision to retire its remaining DC-9 aircraft 
over the next several years. US Airways has suspended its DC-9 
"hush-kit" program in conjunction with its decision to retire this 
fleet-type. As of September 30, 1997, US Airways' operating fleet 
included 50 owned DC-9s, including 27 of which were hush-kitted. 
The remaining components of the Depreciation and amortization 
charge in both quarters relate to the May 1997 efficiency 
measures. The second quarter charge relates primarily to 
facilities abandoned/to be abandoned as a result of the May 1997 
efficiency measures and the third quarter charge includes the 
write-down of certain equipment to be disposed of as a result of 
the May 1997 efficiency measures and certain other adjustments to 
the second quarter charges. 

                              21
<PAGE>
     Gains on sales of interests in affiliates resulted from 
USAM's sale of certain investments, as discussed above under "USAM 
Investments."

     During the second quarter of 1996, US Airways recognized two 
nonrecurring items related to subleasing eleven BAe-146 aircraft. 
A credit of $22.5 million, a reversal of previously accrued lease 
obligations, was recorded in Aircraft rent and a credit of $7.0 
million, a reversal of previously accrued lease return provisions, 
was recognized in Aircraft maintenance. 

Personnel Costs-Excluding nonrecurring items (see above), 
Personnel costs decreased $53.5 million. The Company recognized 
profit sharing expenses associated with US Airways' 1992 Salary 
Reduction Program of $41.1 million during third quarter 1996 (no 
such expenses were incurred during third quarter 1997). In 
addition, defined benefit pension and postretirement benefit 
expenses decreased due primarily to higher interest rates 
(discount factors) used for 1997 calculations. See related 
information under "Other Information." 

Aviation Fuel-Decreased as a result of an 8.1% decrease in US 
Airways' average cost of fuel per gallon partially offset by a 
1.8% increase in gallons of aviation fuel consumed. Effective for 
1997, the Company classifies fuel taxes as an element of Aviation 
fuel expense. These expenses were previously an element of the 
operating expense Other, net (prior period results have been 
reclassified for comparability purposes).

Commissions-See "Other Information" above related to recent 
changes in US Airways' commissions rate structure.

Aircraft Rent-Expenses increased due primarily to a rent expense 
adjustment of $9.6 million related to certain F28-4000 aircraft 
recognized during third quarter 1997.

Other Rent and Landing Fees-Excluding the effects of the 
nonrecurring items (see above), increased $8.7 million due 
primarily to out-of-period adjustments of $4.4 million and the 
timing of when certain facility rent credits were received period-
over-period.

Aircraft Maintenance-Increased due to two "unusual" charges 
recognized during third quarter 1997: $14.5 million related to 
unserviceable (scrapped) JT8D engine parts, and; $10.0 million in 
adjustments related to other spare parts. In addition, US Airways 
continues to experience increases in the cost of certain JT8D jet 
engine parts. Timing factors, primarily related to the timing and 
extent of engine overhauls, are the largest factor with respect to 
the remaining quarter-over-quarter variance. US Airways is 
realizing savings from the "power-by-the-hour" maintenance 
contract for its CFM-56 and CF-6 jet engines which began during 
the fourth quarter of 1996.

Depreciation and Amortization-Increased $7.0 million if 
nonrecurring items (see above) are excluded.

     US Airways' Operating Expenses include the line item "US 
Airways Express capacity purchases." These expenses, which are 
eliminated during the consolidation of the Company's results of 
operations, are discussed under Operating Revenues above.

Other Income (Expense):

Equity in Earnings of Affiliates-USAM discontinued applying the 
equity method of accounting to certain of its investments. See 
"USAM Investments" above for related information.

Gain on sales of interests in affiliates-See "USAM Investments" 
above.

                                  22
<PAGE>
Other, Net-Third quarter 1996 activity included losses totaling 
$10.5 million related to US Airways' sale of four DC-9 aircraft 
and its only owned BAe-146 aircraft and $9.8 million related to US 
Airways' settlement of litigation involving travel agencies.

Provision for Income Taxes-Increased due primarily to increased 
pre-tax income and an increase in the Company's effective tax rate 
as a result of the Company's projected utilization of all 
remaining alternative minimum tax net operating loss carryforwards 
during 1997. See also "Resumption of Regular Dividend Payments on 
Preferred Stock, British Airways' Divestiture and Call of Series B 
Preferred Stock" above for related information.

Income per Common Share-During the third quarter of 1997, most of 
the Series B Preferred Stock was converted into 10.6 million 
shares of Common Stock. On a weighted average basis, this 
transaction had the effect of increasing common shares outstanding 
by approximately 3.9 million shares for the third quarter of 1997 
(see also "Supplemental Information" below).

Supplemental Information-In June 1997, the FASB adopted SFAS No. 
130, "Reporting Comprehensive Income," ("SFAS 130") and SFAS No. 
131, "Disclosures About Segments of an Enterprise and Related 
Information" ("SFAS 131"). SFAS 130 establishes standards for the 
reporting and presentation of comprehensive income and its 
components in financial statements. SFAS 131 establishes standards 
for defining operating segments and the reporting of certain 
information regarding operating segments. The Company believes 
that neither SFAS 130 nor SFAS 131 will have an effect on the 
Company's liquidity, financial condition or results of operations 
as both standards are informational only. If the Company 
determines that it has a reporting obligation under either new 
standard, the necessary information will be disclosed as part of 
the Company's financial reporting in the appropriate period.

In February 1997, the FASB adopted SFAS No. 128, "Earnings per 
Share" ("SFAS 128"). This statement specifies new computation, 
presentation and disclosure requirements for reporting income per 
common share. The provisions of SFAS 128 preclude the Company from 
implementing the new standard prior to December 31, 1997. The 
Company believes that the implementation of SFAS 128 will not have 
a material impact on its future income per common share 
disclosures or on prior period income per common share amounts, 
which must be restated to conform with the provisions of SFAS 128.

              NINE MONTH PERIOD ENDED SEPTEMBER 30, 1997
                       COMPARED WITH THE
              NINE MONTH PERIOD ENDED SEPTEMBER 30, 1996

Operating Revenues (see also "Select US Airways Operating and 
Financial Statistics" below):

Passenger Transportation-US Airways' Passenger transportation 
revenues increased $284.2 million, or 5.6%, as the result of a 
9.8% increase in RPMs offset by the effects of a 3.9% decrease in 
yield. The Company estimates that severe winter weather within the 
Eastern U.S. and the partial Federal Government shutdown adversely 
affected first quarter 1996 revenues by approximately $55 million. 
Inclement weather (hurricanes) during the third quarter of 1996 is 
believed to have negatively affected Passenger transportation 
revenues by approximately $10 million. 

Cargo and Freight-Increased primarily due to volume factors.

Other Operating Revenues-The largest factor contributing to the 
increase is higher revenues from partners in US Airways' Dividend 
Miles program and from reservation rebooking fees offset by 
decreased wet lease revenues. Wet lease revenues decreased $12.6 
million because these arrangements with British Airways ended 
during May 1996. Changes in other components of Other operating 
revenues are largely offset by correlating changes in related 
operating expenses, primarily

                                  23
<PAGE>
those recorded as Other operating expenses, net. US Airways' 
results include certain transactions with related parties that are 
eliminated at the US Airways Group level.

US Airways' Operating Revenues include the line item "US Airways 
Express transportation revenues." This activity is discussed in 
the quarter-over-quarter comparison above.

Operating Expenses (see also "Pilots Ratify New Labor Contract" 
and "Affirmation of Airbus Order" above):

Nonrecurring Items-The Company's Operating Expenses for both 1997 
and 1996 include the nonrecurring items discussed in the quarter-
over-quarter comparison of results of operations.

Personnel Costs-Decreased $52.4 million if nonrecurring items (see 
above) are excluded. The Company recognized profit sharing 
expenses associated with US Airways' 1992 Salary Reduction Program 
of $82.4 million during the first nine months of 1996 (no such 
expenses during 1997). Expenses associated with stock appreciation 
rights ("SARs") were $28.9 million during the first nine months of 
1997 (no such expenses during the first nine months of 1996). In 
addition, defined benefit pension and postretirement benefits 
expenses decreased due primarily to higher interest rates 
(discount factors) used for 1997 calculations.

Aviation Fuel-Primarily volume factors; US Airways' average cost 
of aviation fuel per gallon increased 0.8%.

Aircraft Rent-Excluding the effects of the nonrecurring items (see 
above), costs increased due primarily to rent expense adjustments 
totaling $16.8 million recorded during 1997 related to certain  
F28-4000 aircraft.

Aircraft Maintenance-As discussed in the quarter-over-quarter 
comparison above, certain unusual charges were recognized during 
the third quarter of 1997. Timing factors and an increase in the 
cost of certain JT8D jet engine parts also contributed to more 
than offsetting savings US Airways is realizing from the "power-
by-the-hour" maintenance contract covering its CFM-56 and CF-6 jet 
engines. 1996 activity also included a nonrecurring expense credit 
(see above).

Depreciation and Amortization-Relatively unchanged if nonrecurring 
items (see above) are excluded.

Other Operating Expenses, Net-Wet lease expenses decreased $12.6 
million (see also Other Operating Revenues above). This decrease 
was more than offset by increases in certain sales and traffic-
related expenses (most notably, credit card expenses).

     US Airways' Operating Expenses include the line item "US 
Airways Express capacity purchases." These expenses, which are 
eliminated during the consolidation of the Company's results of 
operations, are discussed under Operating Revenues above.

Other Income (Expense):

Equity in Earnings of Affiliates/Gains on Sales of Interests in 
Affiliates-See quarter-over-quarter comparison above.

Other, Net-Results for the first nine months of 1997 include gains 
totaling $18.0 million related to US Airways' sale of eleven B737-
200 and one F28-4000 aircraft. Results for the first nine months 
of 1996 included losses totaling $10.5 million related to US 
Airways' sale of four DC-9 aircraft and its only owned BAe-146 
aircraft and a $9.8 million expense related to US Airways' 
settlement of litigation involving travel agencies.

                                  24
<PAGE>
Provision for Income Taxes-Increased due primarily to increased 
income and an increase in the Company's effective tax rate as a 
result of the Company's projected utilization of all remaining 
alternative minimum tax net operating loss carryforwards during 
1997.

Income per Common Share-During the third quarter of 1997, most of 
the Series B Preferred Stock was converted into 10.6 million 
shares of Common Stock. During the second quarter of 1997, most of 
the Series F Preferred Stock was converted into 14.5 million 
shares of Common Stock. On a weighted average basis, these 
transactions had the effect of increasing Common Stock shares 
outstanding by approximately 8.4 million shares for the first nine 
months of 1997.

<TABLE>
                                             SELECT US AIRWAYS 
                            OPERATING AND FINANCIAL STATISTICS (SEE NOTE 1 BELOW)

<CAPTION>
                                                Three Months                     Nine Months
                                             Ended September 30,   Increase    Ended September 30,   Increase
                                               1997      1996     (Decrease)    1997      1996      (Decrease)
                                               ----      ----      --------     ----      ----       --------
<S>                                           <C>       <C>         <C>        <C>       <C>         <C>
Revenue passengers (thousands)*               15,080    14,329       5.2 %     44,480    42,228       5.3%
Total RPMs (millions) (Note 2)                10,979    10,267       6.9%      31,930    29,186       9.4%
RPMs (millions)*                              10,940    10,201       7.2%      31,793    28,955       9.8%
Total ASMs (millions) (Note 3)                14,957    14,685       1.9%      44,418    42,491       4.5%
ASMs (millions)*                              14,908    14,610       2.0%      44,254    42,225       4.8%
Passenger load factor* (Note 4)                 73.4%     69.8%      3.6 pts.    71.8%     68.6%      3.2 pts.
Break-even load factor (Note 5)                 70.0%     68.8%      1.2 pts.    66.7%     67.6%     (0.9)pts.
Yield* (Note 6)                                16.16c    17.05c     (5.2)%      16.91c    17.59c     (3.9)%
Passenger revenue per ASM* (Note 7)            11.86c    11.90c     (0.3)%      12.15c    12.06c      0.7%
Revenue per ASM (Note 8)                       13.13c    13.10c      0.2 %      13.42c    13.28c      1.1%
Cost per ASM (Note 9)                          12.27c    12.44c     (1.4)%      12.23c    12.66c     (3.4)%
Average passenger journey (miles)*               726       712       2.0 %        715       686       4.2%
Average stage length (miles)*                    599       584       2.6 %        592       578       2.4%
Revenue aircraft miles (millions)*               111       109       1.8 %        330       317       4.1%
Cost of aviation fuel per gallon (Note 10)     63.96c    69.57c     (8.1)%      68.15c    67.63c      0.8%
Cost of aviation fuel per gallon (Note 11)     58.23c    63.21c     (7.9)%      61.95c    61.28c      1.1%
Gallons of aviation fuel consumed (millions)     287       282       1.8 %        857       824       4.0%
Operating aircraft at period-end                 377       391      (3.6)%        377       391      (3.6)%
Full-time equivalent employees at period-end  39,857    40,047      (0.5)%     39,857    40,047      (0.5)%

*   Scheduled service only (excludes charter service).
c   cents.

Note 1.  Operating statistics include free frequent travelers and the related miles flown. Operating statistics  exclude 
flights operated by US Airways under a wet lease arrangement with British Airways (the "wet lease arrangement," which 
ended May 31, 1996). Financial statistics exclude the effects of nonrecurring items and the revenues and expenses 
associated with the US Airways Express capacity purchase program and the wet lease arrangement. Net nonrecurring expenses 
of $72.3 million and $99.1 million have been excluded from the financial results for third quarter 1997 and the first nine 
months of 1997, respectively, and net nonrecurring expense credits of $29.5 million have been excluded from the financial 
results for the first nine months of 1996 for purposes of calculating financial statistics. Revenues of $12.6 million and 
expenses of $12.6 million associated with the wet lease arrangement have also been excluded from the financial results for 
the first nine months of 1996 for purposes of calculating financial statistics. In addition, the calculation of break-even 
load factor excludes Gains on sales of interests in affiliates.
Note 2.  Revenue Passenger Miles ("RPMs") - revenue passengers multiplied by the number of miles they flew.
Note 3.  Seats available multiplied by the number of miles flown (a measure of capacity).
Note 4.  Percentage of aircraft seating capacity that is actually utilized (RPMs/ASMs).

                                                     (Notes to the table are continued on the following page)

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<PAGE>
Note 5.  Percentage of aircraft seating capacity utilized that equates to US Airways breaking-even at the pre-tax income 
level.
Note 6.  Passenger transportation revenue divided by RPMs.
Note 7.  Passenger transportation revenue divided by ASMs (a measure of unit revenue).
Note 8.  Total Operating Revenues divided by ASMs (a measure of unit revenue).
Note 9.  Total Operating Expenses divided by ASMs (a measure of unit cost).
Note 10. Includes the base cost of aviation fuel, fuel taxes and transportation charges.
Note 11. Includes the base cost of aviation fuel and transportation charges (excludes fuel taxes).
</TABLE>


     US Airways' traffic levels continue to be bolstered by 
favorable domestic economic conditions. US Airways' yield 
decreased for both the third quarter of 1997 and first nine months 
of 1997 versus the comparable periods in 1996. The yield decreases 
are primarily attributable to increased competitive pressures (see 
"Update on US Airways' Competitive Position" above) and the 
effects of the ticket tax. The ticket tax expired on January 1, 
1996, was reinstated on August 27, 1996, expired again on January 
1, 1997 and once again reinstated effective March 7, 1997. As 
discussed under "Other Information" above, the ticket tax was 
modified and extended during August 1997. Also negatively 
affecting yield, US Airways' average passenger journey increased 
for both the third quarter and first nine months of 1997. US 
Airways selectively increased fares in certain markets up to 5% 
during September 1997.

     Unit costs (cost per ASM) decreased slightly versus 1996 
levels on both a quarter-over-quarter and year-over-year basis. 
Changes in certain operating expenses are discussed above in the 
comparisons of financial results. US Airways' expects its unit 
costs to decrease approximately 1% - 2% for fourth quarter 1997 as 
compared to fourth quarter 1996.

     Capacity (ASMs) increased for both periods in 1997 primarily 
as the result of higher aircraft utilization rates during 1997. 
Aircraft utilization was adversely affected by inclement weather 
during both the first and third quarters of 1996. ASMs increased 
4.5% for the first nine months of 1997 as compared to the same 
period in 1996, but only 1.9% for the third quarter of 1997 as 
compared to the third quarter of 1996 due primarily to schedule 
changes implemented during the third quarter of 1997 and aircraft 
retirements (see also "Efficiency Measures" above). US Airways 
expects capacity to decrease approximately 4% for fourth quarter 
1997 as compared to fourth quarter 1996. As compared to capacity 
for full year 1997, US Airways' capacity for 1998 is expected to 
decrease less than the 3 1/2% - 4% decrease previously announced.

     As discussed above under "Pilots Ratify New Labor Contract" 
and "Affirmation of Airbus Order" and elsewhere in this report, 
recent events may have a significant impact on US Airways' future 
operating and financial statistics.

LIQUIDITY AND CAPITAL RESOURCES

     As of September 30, 1997, the Company's Cash and cash 
equivalents and Short-term investments totaled $2.08 billion. As 
indicated in the Company's Condensed Consolidated Statements of 
Cash Flows (which are also contained in Part I, Item 1A of this 
report), net cash provided by operating activities during the 
first nine months of 1997 was $669.2 million, due primarily to the 
effects of factors discussed above under "Results of Operations." 
The Company is unable to predict the impact of recent events 
involving US Airways' labor costs and agreements to purchase new 
aircraft and jet engines on its operating cash flows (see "Pilots 
Ratify New Labor Contract" and "Affirmation of Airbus Order" 
above). The Company expects decreases in certain future operating 
cash outflows as US Airways replaces several older, diverse 
aircraft types with newer, more efficient aircraft, but may 
experience increases in certain other future operating cash 
outflows as the result of US Airways' growth plans (see "Update on 
US Airways' Competitive Position" above).

                                  26
<PAGE>
     With the reinstatement of the ticket tax during March 1997, 
the Company resumed ticket tax remittances to the federal 
government. The ticket tax was not in effect during the periods 
January 1, 1996-August 27, 1996 and January 1, 1997-March 7, 1997. 
The Company also made profit sharing payments to employees 
totaling $129.1 million during first quarter 1997. These payments 
ended the Company's obligation for profit sharing under its 1992 
Salary Reduction Plan (the related expenses were recognized by the 
Company during 1996 and earlier periods). USAM received 
distributions totaling $17.4 million from its CRS investments 
during the first nine months of 1997, as reflected in the Other 
operating adjustments category (see also "USAM Investments" 
above).

     SAR exercises resulted in cash outflows of $47.4 million 
during the first nine months of 1997. As of September 30, 1997, 
approximately 435,000 SARs granted under the 1992 Stock Option 
Plan were outstanding (4.2 million SARs were outstanding as of 
December 31, 1996).

     Investing activities during the first nine months of 1997 
included cash outflows of $134.7 million for the acquisition of 
assets and cash inflows of $54.3 million related to asset 
dispositions. US Airways' cash outflows related to asset 
acquisitions include $79.7 million for aircraft and aircraft-
related assets, $15.6 million for computer equipment, $14.1 
million for third-party maintenance performed on certain subleased 
aircraft and $6.0 million to purchase slots at Washington National 
Airport. Asset dispositions included cash inflows related to US 
Airways' sale of eleven B737-200, one F28-4000 and one Bae-146 
aircraft. Short-term investments increased $222.8 million from the 
year-end 1996 level due primarily to cash flows generated from 
operations exceeding immediate operational needs, particularly 
during the third quarter of 1997. The net cash used for investing 
activities during the first nine months of 1997 was $56.1 million.

     As discussed under "USAM Investments" above, during July 1997 
USAM received proceeds of $162.0 million in connection with the 
sale of its interest in ATS and proceeds of $62.2 million related 
to the sell-down of its interest in Galileo.

     As of September 30, 1997, current maturities of long-term 
debt had increased to $186.6 million, from $84.3 million at the 
end of 1996. The increase is due mainly to reclassifying the first 
series of US Airways' 1993-A Pass Through Trusts, $75.0 million, 
from long-term to short-term status. US Airways currently expects 
to settle this obligation, which becomes payable on September 1, 
1998, from cash on hand. 

     The Company currently estimates that contributions to its 
defined benefit plans for full-year 1997 will total approximately 
$110 million. The Company estimates it will need to contribute 
less than $20 million to these plans in 1998 in order to meet 
statutory minimum pension funding requirements due primarily to 
favorable returns on assets held by these plans and certain 
changes in assumptions underlying the Company's calculations of 
the funding minimums. The Company's estimates of future pension 
plan contributions are subject to change, including the 
possibility of the Company contributing to these plans in excess 
of minimum funding requirements. As mentioned above under "Pilots 
Ratify New Labor Contract," US Airways' new labor contract with 
its pilots includes a provision for early retirement for up to 325 
pilots which could result in the Company funding certain pilot 
pension plans in excess of funding minimums.

     US Airways is currently reviewing the extent and timing of 
its "aircraft interior standardization program" in light of 
affirming its aircraft and jet engine acquisition agreements and 
its decision to retire its DC-9 aircraft. US Airways is currently 
unable to estimate any reduction in the cost or scope of this 
program as a result of these recent events. 

     Net cash used for financing activities during the first nine 
months of 1997 was $339.7 million. The Company paid dividends 
totaling $172.4 million to holders of its preferred stock during 
the first nine months of 1997 and repurchased the Series T 
Preferred Stock and 1,940.636 shares of Series F Preferred Stock 
during May 1997 for a combined $126.2 million. As discussed above, 

                                  27
<PAGE>
British Airways converted the remaining Series F shares into 
Common Stock and subsequently sold those shares to third parties. 
During August 1997, and also discussed above, the Company 
exercised its right to redeem all of its outstanding Series B 
Preferred Stock-all but approximately 6,000 depositary shares were 
converted into Common Stock prior to the redemption date (for 
which the related cash outflows were $0.3 million). With the 
retirement of the Series B, Series F and Series T Preferred Stock, 
the Company's annual preferred stock dividend burden has been 
reduced by approximately $46 million. Issuances of Common Stock 
related to the exercise of stock options resulted in proceeds of 
$30.5 million. The Company's subsidiaries made scheduled debt 
repayments of approximately $63.1 million and US Airways prepaid 
early capital lease obligations of $9.2 million associated with 
three DC-9 aircraft (and assumed title of the aircraft) during the 
first nine months of 1997.

     The Company expects to satisfy all of its short-term 
liquidity requirements through a combination of cash on hand and 
cash generated from operations. However, the Company remains 
highly leveraged. The Company and US Airways require substantial 
working capital in order to meet scheduled debt and lease payments 
and to finance day-to-day operations. The Company currently does 
not have in place a short-term credit or receivable sale 
facilities. In addition, as discussed previously, US Airways has 
entered into agreements to acquire up to 400 new aircraft and jet 
engines to power these aircraft. These agreements will increase US 
Airways' financing needs and will result in a significant increase 
in its financial obligations and debt burden (see related 
discussion below). Changes in certain factors that are generally 
outside the Company's control, such as an economic downturn, 
additional government regulation, intensified competition from 
lower cost air carriers or operations and increases in the cost of 
aviation fuel, could have a material adverse effect on the 
Company's liquidity, financial condition and results of 
operations. Until US Airways is able to establish a competitive 
cost structure, the Company's results of operations and financial 
condition will be particularly susceptible to adverse changes in 
general economic and market conditions.

     As discussed under "Affirmation of Airbus Order" above, the 
Company has entered into agreements for the acquisition of up to 
400 new aircraft and accompanying jet engines. The minimum 
determinable payments associated with the Company's agreements 
with AVSA and CFMI (including progress payments, payments at 
delivery, buyer-furnished equipment, spares, capitalized interest, 
penalty payments, cancellation fees and/or nonrefundable deposits) 
are currently estimated at $92 million during the fourth quarter 
of 1997, $261 million in 1998, $701 million in 1999, $1.06 billion 
in 2000 and $212 million in 2001. If the Company takes delivery of 
all of the Airbus aircraft it currently has on firm order, the 
aggregate payments for aircraft and related expenditures in 
connection with the acquisition of the aircraft could approximate 
$4.75 billion. The Company anticipates using cash on hand for 
purchase deposits due within the next year and currently plans on 
financing a substantial portion of the remaining commitment. The 
Company has commitments or letters of intent which it believes 
will provide financing for at least 25% of the anticipated 
purchase price of such aircraft. However, further financing or 
internally-generated funds will be needed to satisfy the Company's 
capital commitments for the balance of the aircraft purchase price  
and for other aircraft-related expenditures. Other capital 
expenditures, such as for rotables and other aircraft components, 
are also expected to increase in conjunction with the acquisition 
of the new aircraft and jet engines. There can be no assurance 
that sufficient financing will be available for all aircraft and 
other capital expenditures not covered by committed financing.  

     As discussed under "US Airways Shuttle" above, the Company is 
investigating the purchase of Shuttle, Inc., the owner of the US 
Airways Shuttle. The Company's purchase of Shuttle, Inc. would 
result in a material capital expenditure.

     On October 1, 1997, Standard & Poor's ("S&P") placed the 
credit ratings of US Airways Group and US Airways on CreditWatch 
with positive implications. During July 1997, S&P raised its 
ratings outlook on US Airways Group and US Airways to "Positive" 
from "Developing." Credit
                                  28
<PAGE>
ratings issued by such credit rating agencies can have an effect 
on a company's ability to issue debt or equity securities and the 
effective rate at which such financings are undertaken.

     As of September 30, 1997, the Company's ratio of current 
assets to current liabilities was approximately 1.05 to 1 and the 
Company's debt to equity ratio was 9.31 or 10.68 if the Series H 
Preferred Stock is included in the calculation as debt (the Series 
H Preferred Stock is mandatorily redeemable, but convertible into 
Common Stock).


PART II.  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

     As previously disclosed, The Boeing Company ("Boeing") has 
filed suit against US Airways, Inc. ("US Airways")  in state court 
in King County, Washington seeking unspecified damages for alleged 
breach of two aircraft purchase agreements concerning, 
respectively, eight B757-200 aircraft and 40 B737-Series aircraft. 
On October 31, 1997, US Airways filed an answer and counterclaim 
to Boeing's complaint denying liability and seeking recovery from 
Boeing of approximately $45 million in equipment purchase deposits 
and past overcharges.

     US Airways intends to vigorously defend against Boeing's 
lawsuit and to prosecute its counterclaim. US Airways cannot 
predict the outcome of the lawsuit or whether US Airways' results 
of operations and financial condition would be materially affected 
as a result of the lawsuit.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

A.  EXHIBITS

DESIGNATION                            DESCRIPTION

4     Certificate of Designation of the Series H Senior
      Cumulative Preferred Stock.

10.1  Purchase Agreement dated October 31, 1997 between
      US Airways Group, Inc. and AVSA, S.A.R.L, an affiliate of
      aircraft manufacturer Airbus Industrie G.I.E. (US Airways
      Group, Inc. has applied for confidential treatment for
      portions of this exhibit).

10.2  Employment agreement between US Airways, Inc. and its Chief
      Financial Officer.

11    Computation of Primary and Fully Diluted Income (Loss) Per
      Common Share for the three months and nine months ended
      September 30, 1997 for US Airways Group, Inc.

27.1  Financial Data Schedule - US Airways Group, Inc.

27.2  Financial Data Schedule - US Airways, Inc.


B.  REPORTS ON FORM 8-K

DATE OF REPORT                  SUBJECT OF REPORT

October 22, 1997      News release dated October 22, 1997 of 
                      US Airways Group, Inc. and US Airways, Inc.
                      with consolidated statements of operations
                      for both companies for the three months and
                      nine months ended September 30,

                                29
<PAGE>
                      1997, and select operating and financial
                      statistics for US Airways, Inc. US Airways
                      Group, Inc. also announced that it had
                      reached an agreement with CFM International
                      Inc. ("CFMI") for the purchase of CFM56
                      engines for up to 400 Airbus Industrie G.I.E
                      ("Airbus") 320 family aircraft. In addition,
                      General Electric Company ("GE"), joint owner 
                      of CFMI, will provide US Airways, Inc. with
                      delivery positions for nine Airbus aircraft 
                      scheduled for delivery to GE Capital 
                      Aviation Services, Inc., a wholly-owned 
                      subsidiary of GE, in the years 1999 and 
                      2000.

October 1, 1997       News release announcing that US Airways, 
                      Inc. had reached a tentative agreement on a 
                      competitive contract with the Air Line 
                      Pilots Association.

September 11, 1997    US Airways Group, Inc. disclosed that The 
                      Boeing Company had filed suit against US 
                      Airways, Inc. in the Superior Court of the 
                      State of Washington for King County 
                      alleging, among other things, that US 
                      Airways, Inc. had breached aircraft purchase 
                      agreements for eight B757-200 and 40 
                      B737-Series aircraft.

August 18, 1997       US Airways Group, Inc. announced that it was 
                      exercising its right to redeem all of its 
                      outstanding Series B preferred stock at 
                      $51.75 per depositary share plus accrued 
                      dividends of approximately 36.46 cents as of
                      the redemption date, September 15, 1997.

                             SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act 
of 1934, the registrants have duly caused this report to be signed 
on their behalf by the undersigned thereunto duly authorized.


                              US Airways Group, Inc.  (Registrant)

Date:  November 12, 1997         By:     /s/ James A. Hultquist
                                         ----------------------
                                             James A. Hultquist
                                                Controller
                                        (Chief Accounting Officer)


                               US Airways, Inc.  (Registrant)

Date:  November 12, 1997         By:     /s/ James A. Hultquist
                                         ----------------------
                                             James A. Hultquist
                                                Controller
                                        (Chief Accounting Officer)







                  (this space intentionally left blank)



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