EXHIBIT 10.8
          AMENDED AND RESTATED EMPLOYMENT AGREEMENT OF PATRICK FARRELL


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                    AMENDED AND RESTATED EMPLOYMENT AGREEMENT

                  THIS  AMENDED  AND   RESTATED   EMPLOYMENT   AGREEMENT   (this
"Agreement"),  effective  as of November 1, 2000,  is entered  into by and among
Patrick  Farrell  ("Employee"),   iParty  Corp.,  a  Delaware  corporation  (the
"Company"),  and  iParty  Retail  Stores  Corp.,  a  Delaware  corporation  (the
"Subsidiary").

                              W I T N E S S E T H :
                              - - - - - - - - - -

                  WHEREAS, the Company and Employee have previously entered into
an  employment  letter  agreement  dated as of March 12,  1999 (the  "Employment
Agreement"); and

                  WHEREAS, the Company and Employee now each desire to amend and
restate in its entirety the Employment Agreement as set forth in this Agreement.

                  NOW,  THEREFORE,  in  consideration  of the mutual  agreements
hereinafter set forth, and intending to be legally bound hereby,  Employee,  the
Company and the Subsidiary have agreed and do hereby agree as follows:

                  1. Duties and Title.  The Company does hereby  employ,  engage
                     ----------------
and hire Employee as President and Chief Financial Officer of the Company and as
President  of the  Subsidiary.  Employee  does  hereby  accept and agree to such
hiring, engagement and employment.  Employee agrees to perform any and all other
duties and to assume any and all  responsibilities  that may be assigned to him.
Employee shall devote his full time (at least forty (40) hours per week), energy
and skill to the performance of his duties for the Company and the Subsidiary.

                  2.       Compensation.
                           -------------

                           (a)      The Company  shall pay Employee and Employee
agrees and  accepts  from the  Company,  in full  payment for his  services  and
promises to the  Company,  a base salary (the "Base  Salary") at the rate of One
Hundred Sixty-Five Thousand Dollars  ($165,000.00) per year, less all applicable
payroll  witholding  taxes and  deductions for insurance  contributions  and the
like.  The Base Salary shall be payable in accordance  with the regular  payroll
practices of the Company, as in effect from time to time.

                           (b)      The Company  also  agrees to pay  Employee a
maximum of Two [Thousand Seven Hundred Fifty Thousand  Dollars  ($2,750.00)] per
month for all reasonable living expenses, properly receipted, including, but not
limited  to,  temporary  housing in Boston and costs  associated  with  Employee
leasing an automobile during the Employment Period (the "Lease").

                  3.       Benefits.  Employee  shall be eligible to participate
                           --------
in any  medical  and dental  plan  adopted by the Company for the benefit of its
employees and Employee  shall  receive such other  benefits as may be granted to
him from time to time by the Board of Directors.

                  4.       Vacation.  Employee  is  entitled  to four (4)  weeks
                           --------
paid vacation per calendar year, with such vacation to be scheduled and taken in
accordance with the Company's standard vacation policies.

                  5.       Relocation Expenses.  The  Company  shall   reimburse
                           -------------------
Employee for all reasonable  relocation expenses including,  but not limited to,
the shipment of furniture and other  household goods from New York to Boston and
broker's fees or agent's commission in association with the rental or leasing of
an apartment.

                  6.       Employment Period.
                           -----------------

                           (a)      The Company  shall employ the Employee for a
period  commencing  as of  November  1, 2000 and ending on October 31, 2001 (the
"Employment Period"), unless sooner terminated in accordance with the provisions
of this Employment Agreement.

                           (b)      At  the  end  of  the   Employment   Period,
provided  that this  Agreement has not been  terminated  in accordance  with the

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provisions of this Employment Agreement,  the Company shall pay Employee a bonus
equal to four and  one-half  (4 1/2) months of his Base  Salary  ("Bonus").  The
Company shall also pay all of  Employee's  reasonable  relocation  expenses from
Boston to New York, including, but not limited to, the shipment of furniture and
other household goods from Boston to New York and temporary  housing in New York
("Relocation  Expenses").  The Bonus and Relocation Expenses shall be payable on
the  first  payroll  disbursement  date for the month  following  the end of the
Employment Period.

                           (c)      At  the  end  of  the   Employment   Period,
provided  that this  Agreement has not been  terminated  in accordance  with the
provisions of this  Employment  Agreement,  Employee  shall have the option (the
"Option") to assume the Lease.  Employee  shall  provide  written  notice to the
Company if he does not wish to exercise the Option.  The Company  agrees that if
Employee  does not  exercise the Option,  the Company  shall assume all costs in
connection with the termination of the Lease.

                  7.       Termination of Employment.
                           -------------------------

                           (a)      Notwithstanding  anything herein  contained,
if on or after the date  hereof and prior to the end of the  Employment  Period,
the Company or  Employee,  as the case may be, shall have the right to terminate
Employee's services under this Agreement.  Termination of Employee's  employment
shall be deemed  termination  for  "cause"  if on  account  of:  (i)  Employee's
voluntary resignation (other than as a result of Employee's death or disability,
or for the reasons set forth in subparagraphs  (x) and (y)); (ii)  intentionally
fail to follow any commercially  reasonable and lawful direction of the Board of
Directors and continue to fail to follow such direction within three (3) days of
written notification of the same; (iii) Employee is charged with a felony crime;
(iv)  Employee  commits any act of fraud  against the Company;  and (v) Employee
commits any act or omits to take any action in bad faith and to the detriment of
the Company.  Cessation of the employment  relationship between Employee and the
Company by reason of  Employee's  death or permanent  disability,  or Employee's
resignation   because  of  (x)  the  assignment  to  him  of  duties  materially
inconsistent with respect to his position as contemplated by this Agreement,  or
(y) any material  failure by the Company to comply with the  provisions  of this
Agreement, shall be deemed termination without "cause."

                           (b)      Termination  because  of  Disabilities.
                                    --------------------------------------
Employee  shall be considered to be "disabled" for purposes of this Section 6 if
Employee is unable to perform his  customary  duties under this  Agreement for a
continuous  period of four (4) months because of physical or mental  impairment,
in which event this  Agreement  shall  terminate  upon thirty (30) days  written
notice to Employee  and no further  compensation  shall be payable to  Employee,
except as may  otherwise  be provided  under any  disability  insurance  policy.
Notwithstanding  anything to the  contrary  above,  if  Employee  is  terminated
pursuant to this  Section  7(b),  he shall be entitled to any accrued but unused
vacation time (the "Unused Vacation Payment"). The Unused Vacation Payment shall
be payable on the first payroll  disbursement  date for the month  following the
date this Agreement terminates.


                           (c)      Effect of Termination Without "Cause".
                                    -------------------------------------
If Employee's  employment is terminated  without "cause," the Company shall give
notice  of  termination  of  Employee's  services  hereunder  as of a date to be
specified  in such  notice and this  Agreement  shall  terminate  on the date so
specified (the "Without  Cause  Termination  Date").  The Company shall also pay
Employee:  (i) the  Bonus,  (ii) the  Relocation  Expenses  and (iii) the Unused
Vacation  Payment.  The Bonus,  Relocation  Expenses and Unused Vacation Payment
shall be payable on the first payroll  disbursement date for the month following
the Without Cause Termination Date.

                           (d)      Effect of Termination  for "Cause".
                                    ----------------------------------
If  Employee's  employment is terminated by the Company for "cause," the Company
shall give notice of termination of Employee's  services  hereunder as of a date
to be specified in such notice and this Agreement shall terminate on the date so
specified (the "Termination  Date").  Employee shall be entitled to receive only
his Base Salary at the rate provided in Section 2(a) to the Termination Date and
Employee shall not be entitled to any other compensation or benefits not already
earned and vested on the Termination Date.

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                           (e)      If  Employee's  employment  is terminated by
Employee's  voluntary  resignation  (other  than for the  reasons  set  forth in
paragraphs  (x) or (y) or paragraph  (a) above)  Employee  agrees to provide the
Company with thirty (30) days' advance  written notice of such  termination  and
this  Agreement  shall  terminate  on the date so  specified  (the  "Resignation
Termination  Date").  If  Employee  resigns,  he shall be entitled to the Unused
Vacation  Payment.  The Unused  Vacation  Payment  shall be payable on the first
payroll  disbursement  date for the month following the Resignation  Termination
Date.

                           (f)      Nothing contained in this Section 6 shall be
deemed  to limit  any  other  right  the  Company  or the  Employee  may have to
terminate Employee's employment hereunder upon any ground permitted by law.

                  8.       Termination of Prior  Agreements.
                           --------------------------------
This  Agreement  terminates  and  supercedes  any and all prior  agreements  and
understandings between the parties with respect to employment or with respect to
the compensation of Employee by the Company.

                  9.       Nondisclosure and Nonuse of Confidential Information.
                           -----------------------------------------------------
Employee  shall not use or disclose to any other  person  (except as required by
applicable  law or for the  proper  performance  of his  duties  hereunder)  any
confidential  information  obtained by him incident to his  employment  or other
associations with the Company and the Subsidiary. Employee understands that this
restriction shall continue to apply after his employment terminates,  regardless
of the reason for such termination.

                  10.      Non-competition.   During    Employee's    employment
                           ---------------
hereunder  and  for a  period  of  one  year  thereafter  (the  "Non-competition
Period"),  Employee shall not, without permission of the Company:  (i) engage in
any activity, whether as owner, partner, investor,  consultant, agent, employee,
co-venturer or otherwise,  that is competitive  with the business of the Company
or the Subsidiary,  or (ii) solicit or do business with, directly or indirectly,
any present or past customer of the Company or the Subsidiary.

                  11.      Enforcement.  The Company and  Employee  agree that a
                           ----------
breach of the  provisions  of  Sections 8 or 9 hereof  would  cause  irreparable
damage to the Company or the  Subsidiary and that recovery by the Company or the
Subsidiary  of money damages  would not  constitute an adequate  remedy for such
breach.  Accordingly,  the Company,  the  Subsidiary and Employee agree that the
provisions of Sections 8 and 9 hereof may be  specifically  enforced in addition
to any other rights or remedies available on account of such breach.

                  12.      Assignment.   This   Agreement  is  personal  in  its
                           ----------
nature and  neither of the  parties  hereto  shall,  without  the consent of the
other, assign or transfer this Agreement or any rights or obligations hereunder;
provided that, in the event of a merger or consolidation of the Company with any
other entity, this Agreement shall, subject to the provisions hereof, be binding
upon and  inure to the  benefit  of such  successor  and  such  successor  shall
discharge and perform all the promises, covenants, duties and obligations of the
Company hereunder.  In addition, the Company or the Subsidiary shall require any
purchaser  of all,  or  substantially  all, of its assets to assume and agree to
perform  this  Agreement  in the same  manner  and to the same  extent  that the
Company  would be  required  to  perform  it if no sale of its  assets had taken
place.

                  13.      Governing Law.  This  Agreement  shall be governed in
                           -------------
all respects, whether as to validity,  construction,  capacity,  performance, or
otherwise, by the laws of the State of New York. Except as otherwise provided in
Section 14 hereof,  no action  involving this Agreement may be brought except in
the  Supreme  Court of the State of New York in the County of New York or United
States District Court for the Southern District of New York.

                  14.      Entire  Agreement.   This   Agreement   embodies  the
                           -----------------
entire  agreement of the parties  respecting  those matters within its scope and
may be modified  only in writing  executed by the Company,  the  Subsidiary  and
Employee.

                  15.      Arbitration.     All  claims,   disputes   and  other
                           -----------
matters  in  question   between  the  parties  arising  out  of  the  employment

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relationship shall be decided by arbitration in accordance with the rules of the
American Arbitration  Association,  unless the parties mutually agree otherwise.
The award by the arbitrator  shall be final, and judgment may be entered upon it
in accordance  with applicable law in the Supreme Court of the State of New York
in the County of New York or the United States  District  Court for the Southern
District of New York.

                  16.      Waiver.    Failure to insist upon  strict  compliance
                           ------
with any of the terms,  covenants  or  conditions  hereof  shall not be deemed a
waiver  of  such  term,   covenant  or  condition,   nor  shall  any  waiver  or
relinquishment  of, or failure to insist upon strict  compliance with, any right
or power hereunder at any one or more times be deemed a waiver or relinquishment
of such right or power at any other time or times.

                  17.      Severability.   In  the   event   that  a  court   of
                           ------------
competent  jurisdiction  determines  that any  portion of this  Agreement  is in
violation  of any  statute  or public  policy,  then only the  portions  of this
Agreement  that  violate such  statute or public  policy shall be stricken.  All
portions of this  Agreement  that do not violate such  statute or public  policy
continue in full force and effect. Further, any court order striking any portion
of this  Agreement  shall  modify the  stricken  terms to give as much effect as
possible to the intentions of the parties under this Agreement.

                  18.  Notices.  Any  notice,  consent,  or other  communication
required or  permitted  to be given  hereunder  shall be in writing and shall be
deemed to have been  given  three (3) days after the date sent if sent by United
States certified mail,  return receipt  requested,  with proper postage thereon,
one (1) day  after  the  date  sent if sent by  overnight  courier  of  national
recognition,  or on the day of delivery if by hand to an officer of the Company.
Notices shall be addressed as follows:

           (a)      If to Employee:           Patrick Farrell

                                              -----------------------

                                              -----------------------

           (b)      If to the Company         iParty Corp.
                    or Subsidiary:            1457 V.F.W. Parkway
                                              West Roxbury, MA  02132
                                              Attn: Sal Perisano

           (c)      With a copy to:           Akin, Gump, Strauss, Hauer & Feld,
                                              L.L.P.
                                              590 Madison Avenue
                                              New York, New York 10022
                                              Attn: Robert S. Matlin, Esq.

or at such other  address or addresses as the party  addressed  may from time to
time designate by written notice.

                  19.      Headings;  Counterparts.   The   headings   in   this
                           -----------------------
Agreement  are solely for the  convenience  of  reference  and shall be given no
effect in the construction or interpretation  of this Agreement.  This Agreement
may be executed in any number of counterparts,  each of which shall be deemed an
original,  but  all  of  which  together  shall  constitute  one  and  the  same
instrument.

                            [SIGNATURE PAGE FOLLOWS]


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                  IN  WITNESS  WHEREOF,   the  undersigned  have  executed  this
Agreement  or cause this  Agreement  to be executed on its behalf as of the date
first written above.

                                                   iPARTY CORP.


                                                   By:  /s/ Sal Perisano
                                                        ------------------------
                                                         Sal Perisano
                                                         Chief Executive Officer

                                                   iPARTY RETAIL STORES CORP.


                                                   By:  /s/ Sal Perisano
                                                        ------------------------
                                                         Sal Perisano
                                                         Chief Executive Officer

                                                   EMPLOYEE


                                                   /s/ Patrick Farrell
                                                   -----------------------------
                                                   Patrick Farrell



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