SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549
                  -------------------------------------------
                                   FORM 10-K
   (mark one)
   [ X ] Annual Report Pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934 for the fiscal year ended December 28, 1996

   [   ] Transition Report Pursuant to Section 13 or 15(d) of the
         Securities Exchange Act of 1934

                         Commission file number 1-12137

                              THERMO FIBERGEN INC.
             (Exact name of Registrant as specified in its charter)

   Delaware                                                       04-3311544
   (State or other jurisdiction of                          (I.R.S. Employer
   incorporation or organization)                        Identification No.)

   8 Alfred Circle
   Bedford, Massachusetts                                              01730
   (Address of principal executive offices)                       (Zip Code)
       Registrant's telephone number, including area code: (617) 622-1000

          Securities registered pursuant to Section 12(b) of the Act:
       Title of each class        Name of each exchange on which registered
   ----------------------------   -----------------------------------------
   Common Stock, $.01 par value             American Stock Exchange
   Redemption Rights
   Units

          Securities registered pursuant to Section 12(g) of the Act:
                                      None
   Indicate by check mark whether the Registrant (1) has filed all reports
   required to be filed by Section 13 or 15(d) of the Securities Exchange
   Act of 1934 during the preceding 12 months (or for such shorter period
   that the Registrant was required to file such reports), and (2) has been
   subject to the filing requirements for at least the past 90 days. 
   Yes [ X ] No [   ]

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

   The aggregate market value of the voting stock held by nonaffiliates of
   the Registrant as of January 24, 1997, was approximately $42,291,000.

   As of January 24, 1997, the Registrant had 14,715,000 shares of Common
   Stock outstanding.
                      DOCUMENTS INCORPORATED BY REFERENCE
   Portions of the Registrant's Annual Report to Shareholders for the year
   ended December 28, 1996, are incorporated by reference into Parts I and
   II.

   Portions of the Registrant's definitive Proxy Statement for the Annual
   Meeting of Shareholders to be held on June 2, 1997, are incorporated by
   reference into Part III.
PAGE
<PAGE>
                                     PART I

    Item 1.  Business

    (a)  General Development of Business

        Thermo Fibergen Inc. (the Company or the Registrant) was established
    as a subsidiary of Thermo Fibertek Inc. (Thermo Fibertek) to develop and
    commercialize equipment and systems to recover materials from papermaking
    sludge generated by plants that produce virgin and recycled pulp and
    paper. The Company intends to finance, build, own, and operate recovery
    plants on sites at, or immediately adjacent to, virgin and recycled pulp
    mills. Employing a proprietary process, the Company's plants will recover
    and clean long cellulose fibers for sale to paper mills, clarify water
    for reuse by mills, and process the remaining recoverable components of
    papermaking sludge, such as short fibers, fines, and minerals, into
    commercial products. In July 1996, the Company's wholly owned subsidiary
    GranTek Inc. (GranTek), acquired substantially all of the assets, subject
    to certain liabilities, of Granulation Technology, Inc. (Granulation
    Technology) and Biodac, a division of Edward Lowe Industries, Inc., for
    approximately $12.1 million in cash. GranTek employs patented technology
    to produce absorbing granules from papermaking sludge. These granules,
    marketed under the trade name BIODAC(R), are currently used as a carrier
    to deliver agricultural chemicals for professional turf, home lawn and
    garden, and mosquito control applications. Prior to its July 1996
    acquisition of Granulation Technology and Biodac, the Company was in the
    development stage.

        The Company's strategy is to generate revenues from several sources.
    First, the Company will seek to enter into long-term contracts with pulp
    and paper mills under which the Company will charge the customer a fee to
    accept the customer's papermaking sludge. Second, the Company intends to
    sell much of the clean long fibers it recovers directly back to the
    customer for use in the papermaking process. Third, the Company will
    apply existing technologies, such as its granulation process, and expects
    to develop new technologies to maximize the value of the other
    recoverable components of the papermaking sludge for sale into other
    markets.

        The Company is actively developing a process to recover long fibers
    from papermaking sludge, and has completed the construction of a mobile
    pilot recovery system, which the Company is using for initial mill
    demonstrations of its fiber-recovery process. The Company's strategy is
    to target the United States and European virgin and recycling mills that
    have the highest papermaking sludge-disposal costs, enter into long-term
    contracts with these mills, and construct plants that feature the
    Company's granulation technology, its fiber-recovery technology, or both.

        The Company was incorporated in Delaware in February 1996 as a wholly
    owned subsidiary of Thermo Fibertek. In September 1996 the Company sold
    4,715,000 units, each unit consisting of one share of Company common
    stock and one redemption right, in an initial public offering at $12.75
    per unit for net proceeds of approximately $55.8 million. The common
    stock and redemption rights began trading separately on December 13,
    1996. Holders of a redemption right have the option to require the

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    Company to redeem, in September 2000 and 2001, one share of Thermo
    Fibergen common stock at $12.75 per share. The redemption rights carry
    terms that generally provide for their expiration if the closing price of
    the Company's common stock exceeds $19 1/8 for 20 of any 30 consecutive
    trading days prior to September 2001. The redemption rights are
    guaranteed, on a subordinated basis, by Thermo Electron Corporation
    (Thermo Electron). As of December 28, 1996, Thermo Fibertek owned
    10,000,000 shares of the Company's common stock, representing 68% of such
    stock outstanding.

         A publicly traded subsidiary of Thermo Electron, Thermo Fibertek
    develops, manufactures, and markets a range of equipment and products for
    the paper and paper-recycling industries. Thermo Electron is a world
    leader in environmental monitoring and analysis instruments, biomedical
    products such as heart-assist devices and mammography systems,
    papermaking and paper-recycling equipment, biomass electric power
    generation, and other specialized products and technologies. Thermo
    Electron also provides a range of services related to environmental
    quality.

    Forward-looking Statements
        Forward-looking statements, within the meaning of Section 21E of the
    Securities Exchange Act of 1934, are made throughout this Annual Report
    on Form 10-K. For this purpose, any statements contained herein that are
    not statements of historical fact may be deemed to be forward-looking
    statements. Without limiting the foregoing, the words "believes,"
    "anticipates," "plans," "expects," "seeks," "estimates," and similar
    expressions are intended to identify forward-looking statements. There
    are a number of important factors that could cause the results of the
    Company to differ materially from those indicated by such forward-looking
    statements, including those detailed under the caption "Forward-looking
    Statements" in the Registrant's 1996* Annual Report to Shareholders
    incorporated herein by reference.

    (b) Information About Industry Segments

        The Company is engaged in one business segment.

    (c) Description of Business

        (i)  Principal Products and Services

        The Company currently produces BIODAC, an agricultural carrier that
    is virtually dust-free and is uniform in particle size, absorptivity, and
    bulk density. BIODAC is chemically neutral to a range of pesticides and
    breaks down into elements naturally occurring in the soil. BIODAC is sold
    in bulk to chemical companies for use as a carrier to deliver
    agricultural chemicals for professional turf, home lawn and garden, and
    mosquito control applications. The Company intends to further develop
    GranTek's technology to produce granules for the oil- and
    grease-absorption and the cat-box filler markets.


    *References to 1996, 1995, and 1994 herein are for the fiscal years
     ended December 28, 1996, December 30, 1995, and December 31, 1994,
     respectively.
                                        3PAGE
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        (ii) and (xi)  New Products; Research and Development

        The Company is developing a proprietary process to recover long
    cellulose fibers from papermaking sludge and has completed the
    construction of a mobile pilot recovery system that the Company is using
    for initial mill demonstrations of its fiber-recovery process. During
    this period, the Company will continue to modify its technology and will
    also determine where to build its first permanent facilities. However,
    until the Company obtains meaningful data from commercial operations, it
    will not be in a position to determine exactly what modifications may be
    necessary.

        The Company's research and development efforts are currently focused
    on developing and improving its fiber-recovery process. Modifications to
    existing equipment are also under consideration to improve washing and
    de-inking capabilities. The Company is also exploring cost-effective
    processes to produce higher-value products from papermaking sludge.

        GranTek operates a manufacturing plant in Green Bay, Wisconsin, at
    which it processes sludge provided by a nearby paper mill into BIODAC. A
    pilot plant is located within GranTek's main manufacturing plant. This
    pilot plant is permitted to process 24 tons of material per day, and has
    been used to develop many of the innovations implemented in GranTek's
    main plant. The Company believes that this pilot plant will give the
    Company the ability to process waste streams from other paper mills under
    operating conditions and in quantities sufficient to determine final
    product and operating characteristics and costs, as well as to develop
    new technologies.

        GranTek is presently engaged in research and development of absorbing
    granular products that, if successful, would provide an opportunity to
    enter the oil- and grease-absorption and cat-box filler markets.

        The Company currently intends to limit the pace and amount of its
    research and development on both its fiber-recovery system and on new
    products, if any, that may be developed so that its internally funded
    research and development expenditures will be approximately equivalent to
    the interest or dividend income earned on its cash balances, plus the
    Company's operating earnings, if any.

        Research and development expenses for the Company were $1,300,000,
    $601,000, and $128,000 in 1996, 1995, and 1994, respectively.

        (iii)  Raw Materials

        Under GranTek's contract with a paper mill, the mill has the
    exclusive right to supply papermaking sludge to GranTek's commercial
    plant. In exchange, the mill is required to use its best efforts to
    provide GranTek with up to a maximum of 250 tons of sludge per day,
    required for the recovery process. The contract terminates on December
    26, 1997, subject to successive mutual two-year extensions.

        The inability of the Company to obtain papermaking sludge from this
    paper mill would have a material adverse effect upon the Company's
    operations.

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        (iv)  Patents, Licenses, and Trademarks

        The Company currently holds several issued U.S. patents, expiring at
    various dates ranging from 2004 to 2012, relating to various aspects of
    the processing of cellulose-based granular materials and the use of such
    materials in the agricultural, general absorption, oil- and
    grease-absorption, and cat-box filler markets. The Company also has
    foreign counterparts to its U.S. patents in Canada and in various
    European countries, and has additional patents pending in three European
    countries. In addition, Thermo Fibertek holds two U.S. patents, expiring
    in 2011 and 2014, respectively, and expects to file additional U.S.
    patent applications relating to the "scalping" technology that is a key
    component of the Company's fiber-recovery system. Although the Company
    has licensed the technology covered by Thermo Fibertek's patents for use
    in pulp and paper industry applications, the Company does not itself hold
    any patents or patent applications with respect to its pilot
    fiber-recovery system.

        GranTek has granted two companies nonexclusive licenses under two of
    its patents to sell cellulose-based granules produced at an existing site
    for sale in the oil- and grease-absorption and cat-box filler markets.

        The Company believes that its technology, services, products, and
    other proprietary rights do not infringe on the proprietary rights of
    third parties. There can be no assurance, however, that third parties
    will not assert infringement claims in the future. 

        (v)  Seasonal Influences

        In 1996, the Company's sales were exclusively in the agricultural-
    carrier market. The Company's primary customers in this market, chemical
    formulators, typically purchase carriers during the winter and spring for
    the cultivation and planting season. As a result, the Company expects to
    earn a disproportionately high share of its revenues for its
    agricultural- carrier products during the first two quarters of the year.
    The Company believes that its planned entrance into the oil and grease
    absorption and cat box filler markets if successful, may mitigate the
    seasonality of the Company's sales.

        (vi)  Working Capital Requirements

        There are no special inventory requirements or credit terms extended
    to customers that would have a material adverse effect on the Company's
    working capital.

        (vii)  Dependency on a Single Customer

        The Company derived 56% and 21% of its revenues during 1996 from
    Monsanto Solaris Group and Rhone-Poulenc AG Company, respectively.

        (viii)  Backlog

        The Company's backlog of firm orders was $106,000 as of December 28,
    1996. The Company had no backlog of firm orders as of December 30, 1995.


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    The Company believes that substantially all of the backlog at December
    28, 1996, will be shipped or completed during the next twelve months. The
    Company does not believe that the size of its backlog is necessarily
    indicative of intermediate or long-term trends in its business.

        (xi)  Government Contracts

        Not applicable.

        (x)  Competition

        The Company expects that its principal competitors for access to
    papermaking sludge will be landfills, which currently have a collective
    70% market share in North America, and approximately 40% market share in
    Europe. The Company believes, however, that landfill costs will tend to
    increase over time and that regulations governing landfills will become
    more strict, particularly in Europe and Japan. The balance of the
    papermaking sludge produced in the U.S. and Europe is currently
    incinerated or used to manufacture composting materials, egg cartons, and
    other low-value industrial products.

        Several large waste-management companies have increased their
    marketing activities to provide landfill disposal services to the pulp
    and paper industry. Although the Company does not believe that these
    companies are able to provide a sludge processing capability, the Company
    can expect that if its technology is successful, others will seek to
    develop similar technologies and products that may be superior to those
    of the Company. As other companies attempt to provide landfill services,
    sludge processing capability to the pulp and paper industry, or both, the
    Company expects to encounter increasing competition.

        The Company believes that its approach to the management of
    environmental problems associated with papermaking sludge and its ability
    to take advantage of Thermo Fibertek's name recognition, financial
    strength, and experience constitute significant competitive advantages.

        The Company believes that GranTek is currently the only producer of
    cellulose-based agricultural carriers. GranTek's principal competitors in
    the U.S. are producers of clay-based agricultural carriers for row crops
    and professional turf protection, including Oil-Dri Corporation of
    America, Floridin/Engelhard, Aimcor, and American Colloid, and producers
    of corncob granules traditionally used in the home, lawn and garden, and
    professional turf markets, including The Andersons, Mt. Pulaski, Green
    Products, Independence Cob, and Junior Weisner. GranTek's principal
    competitive advantages are that BIODAC contains virtually no dust and is
    more uniform in absorptivity and particle-size distribution than are
    clay-based and corncob granular carriers, and is chemically neutral,
    requiring little or no chemical deactivation.

        As the Company attempts to develop new markets for the components of
    the papermaking sludge it processes, the Company will encounter
    competition from established companies within those markets. Some of
    these competitors may have substantially greater financial, marketing,
    and other resources than those of the Company, and the Company expects
    that such competition may be intense. The Company believes that the

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    absorbing-products industry considers price to be a significant
    competitive factor and therefore, expects that the demand for the
    Company's products in such markets will be significantly influenced by
    the Company's prices for such products.

        (xii)  Environmental Protection Regulations

        The Company's operations are subject to significant government
    regulation, including stringent environmental laws and regulations. Among
    other things, these laws and regulations impose requirements to control
    air, soil, and water pollution, and regulate health, safety, zoning, and
    land use, as well as the handling and transportation of industrial
    byproducts and waste materials. These requirements may also be required
    as conditions of operating permits or licenses that are subject to
    renewal, modification, or revocation. This regulatory framework imposes
    significant compliance burdens and costs on the Company. Notwithstanding
    the burdens of this compliance, the Company believes that its business
    prospects are enhanced by the enforcement of environmental laws and
    regulations by government agencies.

        Among the principal laws governing the Company's operations are the
    federal Comprehensive Environmental Response, Compensation and Liability
    Act (CERCLA) and its similar state equivalents, the Federal Toxic
    Substances Control Act (TSCA), and the Resource Conservation and Recovery
    Act of 1976 (RCRA). TSCA imposes limitations on the presence in
    commercial products of polychlorinated biphenyls (PCBs), and on the
    generation, handling, storage, and disposal of PCB-containing materials
    and wastes. CERCLA imposes joint and several liability for the costs of
    remediation and natural resource damages on the owner or operator of a
    facility from which there is a release, or a threat of a release, of a
    hazardous substance into the environment, and on the generators and
    transporters of those hazardous substances. RCRA provides a comprehensive
    framework for the regulation of the generation, transportation,
    treatment, storage, and disposal of hazardous waste. Under TSCA, RCRA,
    and equivalent state laws, regulatory authorities may require, pursuant
    to administrative order or as a condition of an operating permit, that
    the owner or operator of a regulated facility take corrective action with
    respect to contamination resulting from past or present operations. The
    intent of RCRA is to control hazardous wastes from the time they are
    generated until they are properly recycled or treated and disposed. Such
    laws also require that the owner or operator of regulated facilities
    provide assurance that funds will be available for the closure and
    post-closure care of its facilities. Because Subtitle D of RCRA imposes
    strict requirements on landfills, such as the requirement that new
    landfills must be lined, RCRA creates an incentive for pulp mills to use
    sludge-management technologies such as those offered by the Company.

        GranTek currently uses papermaking sludge from a nearby mill in Green
    Bay, Wisconsin, to make its granules. The papermaking sludge GranTek
    receives from the mill contains trace amounts of PCBs, dioxins, and
    furans, as well as residual amounts of other regulated compounds. During
    the granulation process, GranTek evaporates approximately 95 percent of
    the water contained in the papermaking sludge. Approximately 1.6 pounds
    per year of PCBs, as well as other compounds such as formaldehyde,
    benzene, and volatile organic compounds (VOCs), are thus emitted into the

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    atmosphere from its Green Bay facility. Applicable Wisconsin regulations
    limit PCB emissions to de minimis amounts unless the generator can
    demonstrate that it is using the best available control technology to
    limit emissions. GranTek has been issued an air operating permit by the
    Wisconsin Department of Natural Resources (the WDNR). GranTek's current
    operating permit and its application for a new Title V operating permit
    each require GranTek to reduce PCB and VOC emissions, and to file
    bi-annual reports on the amounts of PCBs being emitted. In August 1995,
    GranTek submitted materials to the WDNR requesting that GranTek be
    relieved of its obligation to reduce emissions, asserting that there are
    presently no technologically or economically feasible methods to reduce
    PCB or VOC emissions from its facility that can be implemented. GranTek
    has received no response from the WDNR to date. Although the Company
    believes that the WDNR will accept GranTek's findings, and although
    GranTek's facility is currently fully permitted by Wisconsin regulatory
    authorities, no assurance can be given that the WDNR will not require
    GranTek to reduce or eliminate its emissions, that such compliance will
    not require the Company to make significant expenditures, or that such
    compliance will be technologically or economically feasible. Such
    compliance may have material adverse effects on the Company's capital
    expenditures, earnings, and/or competitive position.

        GranTek's BIODAC agricultural carrier is subject to regulation under
    the Federal Insecticide, Fungicide, and Rodenticide Act, which, among
    other things, empowers the U.S. Environmental Protection Agency (EPA) to
    establish and enforce acceptable tolerance levels for agricultural
    chemicals. In 1989, however, at GranTek's request, the EPA granted an
    exemption from the requirement that a tolerance level be established for
    de-inked paper fiber used as a carrier in pesticide formulations applied
    to growing crops.

        The governmental regulatory process requires the Company to obtain
    and retain numerous approvals, licenses, and permits to conduct its
    operations, any of which may be subject to revocation, modification, or
    denial. Operating permits need to be renewed periodically and may be
    subject to revocation, modification, denial, or nonrenewal for various
    reasons, including failure of the Company to satisfy regulatory concerns.
    Adverse decisions by governmental authorities on permit applications
    submitted by the Company may result in abandonment or delay of projects,
    substantially increased operating costs or capital expenditures, and
    premature closure of facilities or restriction of operations, all of
    which could have a material adverse effect on the Company's business and
    prospects.

        (xiii)  Number of Employees

        As of December 28, 1996, the Company employed 34 people. None of the
    Company's employees is represented by a union. The Company believes that
    relations with its employees are good.

    (d) Financial Information About Exports by Domestic Operations and About
        Foreign Operations

        Not applicable.


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    (e) Executive Officers of the Registrant

                                       Present Title 
    Name                        Age    (Year First Became Executive Officer)
    ------------------------    ---    -------------------------------------
    Dr. Yiannis A. Monovoukas   36     President, Chief Executive Officer,
                                         and Director (1996)
    John N. Hatsopoulos         62     Vice President, Chief Financial
                                         Officer, and Director (1996)
    Paul F. Kelleher            54     Chief Accounting Officer (1996)

        Each executive officer serves until his successor is chosen or
    appointed by the Board of Directors and qualified or until his earlier
    resignation, death, or removal. Messrs. Hatsopoulos and Kelleher have
    held comparable positions for at least five years with Thermo Fibertek
    and Thermo Electron. Dr. Monovoukas has been President, Chief Executive
    Officer, and Director of the Company since its incorporation in February
    1996. Dr. Monovoukas was a Corporate Business Analyst at Thermo Electron
    from July 1995 through February 1996. From 1993 through June 1995, Dr.
    Monovoukas was a graduate student at the Harvard Business School. From
    1990 until 1993, he was a staff scientist and engineer with Raychem
    Corporation, a materials science company, which he joined upon completion
    of a Ph.D. program in chemical engineering at Stanford University.
    Messrs. Hatsopoulos and Kelleher are full-time employees of Thermo
    Electron, but devote such time to the affairs of the Company as the
    Company's needs reasonably require.


    Item 2.  Properties

        The Company leases a 6,000-square foot, stand-alone building in
    Bedford, Massachusetts, which holds its administrative offices and
    research laboratory. This lease expires in April 2001, subject to the
    Company's option to extend the lease for two three-year terms. The
    Company also has the right to terminate the lease without penalty in
    April 1999.

        GranTek owns approximately 3.3 acres of land in Green Bay, Wisconsin,
    on which its 26,000 square foot processing plant is situated.

        The Company believes that these facilities are adequate for its
    current operations.


    Item 3.  Legal Proceedings

        Not applicable.


    Item 4.  Submission of Matters to a Vote of Security Holders

        Not applicable.


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                                     PART II

    Item 5.  Market for Registrant's Common Equity and Related Stockholder
             Matters

        Information concerning the market and market price for the
    Registrant's common equity securities and redemption rights and dividend
    policy is included under the sections labeled "Common Stock Market
    Information" and "Dividend Policy" in the Registrant's 1996 Annual Report
    to Shareholders and is incorporated herein by reference.


    Item 6.  Selected Financial Data

        The information required under this item is included under the
    sections labeled "Selected Financial Information" and "Dividend Policy"
    in the Registrant's 1996 Annual Report to Shareholders and is
    incorporated herein by reference.


    Item 7.  Management's Discussion and Analysis of Financial Condition and
             Results of Operations

        The information required under this item is included under the
    heading "Management's Discussion and Analysis of Financial Condition and
    Results of Operations" in the Registrant's 1996 Annual Report to
    Shareholders and is incorporated herein by reference.


    Item 8.  Financial Statements and Supplementary Data

        The Registrant's Consolidated Financial Statements and Supplementary
    Data are included in the Registrant's 1996 Annual Report to Shareholders
    and are incorporated herein by reference.


    Item 9.  Changes in and Disagreements with Accountants on Accounting and
             Financial Disclosure

        Not applicable.









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                                    PART III

    Item 10.  Directors and Executive Officers of the Registrant

        The information concerning directors required under this item is
    incorporated herein by reference from the material contained under the
    caption "Election of Directors" in the Registrant's definitive proxy
    statement to be filed with the Securities and Exchange Commission
    pursuant to Regulation 14A, not later than 120 days after the close of
    the fiscal year. The information concerning delinquent filers pursuant to
    Item 405 of Regulation S-K is incorporated herein by reference from the
    material contained under the heading "Section 16(a) Beneficial Ownership
    Reporting Compliance" in the Registrant's definitive proxy statement to
    be filed with the Securities and Exchange Commission pursuant to
    Regulation 14A, not later than 120 days after the close of the fiscal
    year.

    Item 11.  Executive Compensation

        The information required under this item is incorporated herein by
    reference from the material contained under the caption "Executive
    Compensation" in the Registrant's definitive proxy statement to be filed
    with the Securities and Exchange Commission pursuant to Regulation 14A,
    not later than 120 days after the close of the fiscal year.


    Item 12.  Security Ownership of Certain Beneficial Owners and Management

        The information required under this item is incorporated herein by
    reference from the material contained under the caption "Stock Ownership"
    in the Registrant's definitive proxy statement to be filed with the
    Securities and Exchange Commission pursuant to Regulation 14A, not later
    than 120 days after the close of the fiscal year.


    Item 13.  Certain Relationships and Related Transactions

        The information required under this item is incorporated herein by
    reference from the material contained under the caption "Relationship
    with Affiliates" in the Registrant's definitive proxy statement to be
    filed with the Securities and Exchange Commission pursuant to Regulation
    14A, not later than 120 days after the close of the fiscal year.





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                                     PART IV

    Item 14.Exhibits, Financial Statement Schedules, and Reports on Form 8-K

    (a,d)   Financial Statements and Schedules

            (1)The consolidated financial statements set forth in the list
               below are filed as part of this Report.

            (2)The consolidated financial statement schedule set forth in
               the list below is filed as part of this Report.

            (3)Exhibits filed herewith or incorporated herein by reference
               are set forth in Item 14(c) below.

            List of Financial Statements and Schedules Referenced in this
            Item 14

            Information incorporated by reference from Exhibit 13 filed
            herewith:

               Consolidated Statement of Operations
               Consolidated Balance Sheet
               Consolidated Statement of Cash Flows
               Consolidated Statement of Shareholders' Investment
               Notes to Consolidated Financial Statements
               Report of Independent Public Accountants

            Financial Statement Schedules filed herewith:

               Schedule II: Valuation and Qualifying Accounts

            All other schedules are omitted because they are not applicable
            or not required, or because the required information is shown
            either in the financial statements or in the notes thereto.


      (b)   Reports on Form 8-K

            During the Company's quarter ended December 28, 1996, the
            Company was not required to file, and did not file, any Current
            Report on Form 8-K.


      (c)   Exhibits

            See Exhibit Index on the page immediately preceding exhibits.




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                                   SIGNATURES


        Pursuant to the requirements of Section 13 or 15(d) of the Securities
    Exchange Act of 1934, the Registrant has duly caused this report to be
    signed on its behalf by the undersigned, thereunto duly authorized.

    Date: March 12, 1997           THERMO FIBERGEN INC.



                                   By: Yiannis A. Monovoukas
                                       -------------------------------
                                       Yiannis A. Monovoukas
                                       President and Chief Executive Officer

        Pursuant to the requirements of the Securities Exchange Act of 1934,
    this report has been signed below by the following persons on behalf of
    the Registrant and in the capacities indicated below, as of March 12,
    1997.

    Signature                          Title
    ---------                          -----


    By: Dr. Yiannis A. Monovoukas      President, Chief Executive Officer,
        -------------------------
        Dr. Yiannis A. Monovoukas       and Director


    By: John N. Hatsopoulos            Vice President, Chief Financial
        -------------------------
        John N. Hatsopoulos             Officer, and Director


    By: Paul F. Kelleher               Chief Accounting Officer
        -------------------------
        Paul F. Kelleher


    By: William A Rainville            Chairman of the Board and Director
        -------------------------
        William A Rainville


    By  Anne T. Barrett                Director
        -------------------------
        Anne T. Barrett


    By  Jonathan W. Painter            Director
        -------------------------
        Jonathan W. Painter




                                       13PAGE
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                    Report of Independent Public Accountants
                    ----------------------------------------


    To the Shareholders and Board of Directors of Thermo Fibergen Inc.:

        We have audited, in accordance with generally accepted auditing
    standards, the consolidated financial statements included in Thermo
    Fibergen Inc.'s Annual Report to Shareholders incorporated by reference
    in this Form 10-K, and have issued our report thereon dated February 3,
    1997. Our audits were made for the purpose of forming an opinion on those
    statements taken as a whole. The schedule listed in Item 14 on page 12 is
    the responsibility of the Company's management and is presented for
    purposes of complying with the Securities and Exchange Commission's rules
    and is not part of the basic consolidated financial statements. This
    schedule has been subjected to the auditing procedures applied in the
    audits of the basic consolidated financial statements and, in our
    opinion, fairly states in all material respects the consolidated
    financial data required to be set forth therein in relation to the basic
    consolidated financial statements taken as a whole.



                                            Arthur Andersen LLP



    Boston, Massachusetts
    February 3, 1997






                                       14PAGE
<PAGE>
    SCHEDULE II



                              THERMO FIBERGEN INC.

                        VALUATION AND QUALIFYING ACCOUNTS
                                 (In thousands)


                                                 Accounts
                                     Provision  Recovered
                        Balance at     Charged        and            Balance
                         Beginning          to    Written             at End
                           of Year     Expense        Off  Other(a)  of Year
                        ----------  ----------  ---------  -------- --------
    Year Ended
    December 28, 1996

     Allowance for 
      Doubtful Accounts      $  -        $  -      $   -     $ 30       $ 30



    (a)Allowance of business acquired during the year as described in Note 2
       to Consolidated Financial Statements in the Registrant's 1996 Annual
       Report to Shareholders.

















                                       15PAGE
<PAGE>
                                  EXHIBIT INDEX

    Exhibit
    Number       Description of Exhibit
    ------------------------------------------------------------------------

      3.1        Certificate of Incorporation of the Company, as amended
                 (filed as Exhibit 3.1 to the Registrant's Registration
                 Statement on Form S-1 [Reg. No. 333-07585] and incorporated
                 herein by reference).

      3.2        By-Laws of the Company (filed as Exhibit 3.2 to the
                 Registrant's Registration Statement on Form S-1 [Reg. No.
                 333-07585] and incorporated herein by reference).

      4.1        Form of Guarantee of Thermo Electron (filed as Exhibit 4.1
                 to the Registrant's Registration Statement on Form S-1
                 [Reg. No. 333-07585] and incorporated herein by reference).

      4.2        Guarantee Agreement among the Company, Thermo Electron, and
                 the Representatives of the Underwriters (filed as Exhibit
                 4.2 to the Registrant's Registration Statement on Form S-1
                 [Reg. No. 333-07585] and incorporated herein by reference).

      4.3        Form of Common Stock Certificate (filed as Exhibit 4.3 to
                 the Registrant's Registration Statement on Form S-1 [Reg.
                 No. 333-07585] and incorporated herein by reference).

      4.4        Form of Redemption Right Certificate (filed as Exhibit 4.4
                 to the Registrant's Registration Statement on Form S-1
                 [Reg. No. 333-07585] and incorporated herein by reference).

     10.1        Asset Transfer Agreement dated as of July 2, 1996, between
                 Thermo Fibertek Inc. and the Company (filed as Exhibit 10.1
                 to the Registrant's Registration Statement on Form S-1
                 [Reg. No. 333-07585] and incorporated herein by reference).

     10.2        License and Supply Agreement dated as of July 2, 1996,
                 between Thermo Fibertek and the Company (filed as Exhibit
                 10.2 to the Registrant's Registration Statement on Form S-1
                 [Reg. No. 333-07585] and incorporated herein by reference).

     10.3        Corporate Services Agreement dated July 2, 1996, between
                 Thermo Electron and the Company (filed as Exhibit 10.3 to
                 the Registrant's Registration Statement on Form S-1 [Reg.
                 No. 333-07585] and incorporated herein by reference).

     10.4        Thermo Electron Corporate Charter, as amended and restated
                 effective January 3, 1993 (filed as Exhibit 10.1 to Thermo
                 Electron's Annual Report on Form 10-K for the fiscal year
                 ended January 2, 1993 [File No. 1-8002] and incorporated
                 herein by reference).


                                       16PAGE
<PAGE>
                                  EXHIBIT INDEX

    Exhibit
    Number       Description of Exhibit
    ------------------------------------------------------------------------

     10.5        Tax Allocation Agreement dated as of July 2, 1996, between
                 Thermo Fibertek and the Company (filed as Exhibit 10.5 to
                 the Registrant's Registration Statement on Form S-1 [Reg.
                 No. 333-07585] and incorporated herein by reference).

     10.6        Amended and Restated Master Repurchase Agreement dated as
                 of December 28, 1996, between Thermo Electron and the
                 Company.

     10.7        Master Guarantee Reimbursement Agreement dated as of July
                 2, 1996, among Thermo Electron, Thermo Fibertek, and the
                 Company (filed as Exhibit 10.7 to the Registrant's
                 Registration Statement on Form S-1 [Reg. No. 333-07585] and
                 incorporated herein by reference).

     10.8        Master Guarantee Reimbursement Agreement dated as of July
                 2, 1996, between Thermo Fibertek and the Company (filed as
                 Exhibit 10.8 to the Registrant's Registration Statement on
                 Form S-1 [Reg. No. 333-07585] and incorporated herein by
                 reference).

     10.9        Lease dated as of April 12, 1996, by and between Al and Lee
                 Realty and the Company (filed as Exhibit 10.9 to the
                 Registrant's Registration Statement on Form S-1 [Reg. No.
                 333-07585] and incorporated herein by reference).

     10.10       Equity Incentive Plan of the Company (filed as Exhibit
                 10.11 to the Registrant's Registration Statement on Form
                 S-1 [Reg. No. 333-07585] and incorporated herein by
                 reference).

     10.11       Deferred Compensation Plan for Directors of the Company
                 (filed as Exhibit 10.12 to the Registrant's Registration
                 Statement on Form S-1 [Reg. No. 333-07585] and incorporated
                 herein by reference).

     10.12       Directors Stock Option Plan of the Company (filed as
                 Exhibit 10.13 to the Registrant's Registration Statement on
                 Form S-1 [Reg. No. 333-07585] and incorporated herein by
                 reference).

     10.13       Form of Indemnification Agreement for Officers and
                 Directors of the Company (filed as Exhibit 10.14 to the
                 Registrant's Registration Statement on Form S-1 [Reg. No.
                 333-07585] and incorporated herein by reference).



                                       17PAGE
<PAGE>
                                  EXHIBIT INDEX

    Exhibit
    Number       Description of Exhibit
    ------------------------------------------------------------------------

                 In addition to the stock-based compensation plans of the
                 Registrant, the executive officers of the Registrant may be
                 granted awards under stock-based compensation plans of
                 Thermo Electron and Thermo Fibertek Inc. for services
                 rendered to the Registrant or to such affiliated
                 corporations. Thermo Electron's plans were filed as
                 Exhibits 10.21 through 10.44 to the Annual Report on Form
                 10-K of Thermo Electron for the year ended December 30,
                 1995 [File No. 1-8002] and as Exhibit 10.19 to the Annual
                 Report on Form 10-K of Trex Medical Corporation for the
                 fiscal year ended September 28, 1996 [File No. 1-11827] and
                 Thermo Fibertek's plans were filed as Exhibits 10.19
                 through 10.24 to the Annual Report on Form 10-K of Thermo
                 Fibertek for the fiscal year ended December 28, 1996 [File
                 No. 1-11406] and are incorporated herein by reference.

     11          Statement re: Computation of Loss per Share.

     13          Annual Report to Shareholders for the year ended
                 December 28, 1996 (only those portions incorporated
                 herein by reference).

     21          Subsidiaries of the Registrant.

     23          Consent of Arthur Andersen LLP.

     27          Financial Data Schedule.