FORM 10-Q

                         SECURITIES AND EXCHANGE COMMISSION
                               Washington, D.C. 20549



     (Mark one)

     [X]     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE 
             SECURITIES EXCHANGE ACT OF 1934
             For the quarterly period ended September 30, 1996 or
                                            ------------------

     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES
     EXCHANGE ACT OF 1934
     For the transition period from              to             
                                    -----------     -----------

     Commission file number I-91
                            ----

                          Furniture Brands International, Inc.             
     ----------------------------------------------------------------------
                (Exact name of registrant as specified in its charter)

                 Delaware                                43-0337683        
     ----------------------------------          -------------------------
      (State or other jurisdiction of               (I.R.S. Employer
       incorporation or organization)                Identification No.)

      101 South Hanley Road, St. Louis, Missouri              63105      
     -------------------------------------------          ----------------
     (Address of principal executive offices)                (Zip Code)

     Registrant's telephone number, including area code    (314) 863-1100
                                                          ---------------- 

     --------------------------------------------------------------------- 
     Former name, former address and former fiscal year, if changed since
     last report

          Indicate by check mark whether the registrant (1) has filed all
     reports required to be filed by Section 13 or 15(d) of the Securities
     Exchange Act of 1934 during the preceding 12 months (or for such
     shorter period that the registrant was required to file such reports),
     and (2) has been subject to such filing requirement for the past 90
     days.

                                             Yes  X      No     
                                             ----------  ---------<PAGE>





                   APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                      PROCEEDINGS DURING THE PRECEDING FIVE YEARS

          Indicate by check mark whether the registrant has filed all
     documents and reports required to be filed by Sections 12, 13 or 15(d)
     of the Securities Exchange Act of 1934 subsequent to the distribution
     of securities under a plan confirmed by a court. 

                                             Yes  X      No       
                                             ----------  ----------
       

                        APPLICABLE ONLY TO CORPORATE ISSUERS

     Indicate the number of shares outstanding of each of the issuer's
     classes of common stock, as of the latest practicable date.

                      61,426,281 Shares as of September 30, 1996
                      ------------------------------------------<PAGE>





                            PART I FINANCIAL INFORMATION
                            ----------------------------


     Item 1.  Financial Statements

     Consolidated Financial Statements for the quarter ended September 30,
     1996.

          Consolidated Balance Sheets

          Consolidated Statements of Operations:

               Three Months Ended September 30, 1996
               Three Months Ended September 30, 1995

               Nine Months Ended September 30, 1996
               Nine Months Ended September 30, 1995

          Consolidated Statements of Cash Flows:

               Nine Months Ended September 30, 1996
               Nine Months Ended September 30, 1995

          Notes to Consolidated Financial Statements

     Separate financial statements and other disclosures with respect to
     the Company's subsidiaries are omitted as such separate financial
     statements and other disclosures are not deemed material to investors.

     The financial statements are unaudited, but include all adjustments
     (consisting of normal recurring adjustments) which the management of
     the Company considers necessary for a fair presentation of the results
     of the period.  The results for the three months and nine months ended
     September 30, 1996 are not necessarily indicative of the results to be
     expected for the full year.<PAGE>


<TABLE>
<CAPTION>


                        FURNITURE BRANDS INTERNATIONAL, INC.
                             CONSOLIDATED BALANCE SHEETS
                                (Dollars in thousands)
                                     (Unaudited)
                                                         <C>           <C>


                                                         September 30, December 31,
                                                                 1996         1995
      ASSETS                                             ------------  -----------

      Current assets:
        Cash and cash equivalents....................... $     21,456  $    26,412
        Receivables, less allowances of $25,349                     
          ($20,724 at December 31, 1995)................      292,669      276,116
        Inventories...........................(Note 3)..      280,977      269,677
        Prepaid expenses and other current assets.......       17,608       17,888
                                                         ------------  -----------
          Total current assets..........................      612,710      590,093
                                                         ------------  -----------
      Property, plant and equipment.....................      410,553      389,429
        Less accumulated depreciation...................      114,763       83,023
                                                         ------------  -----------
          Net property, plant and equipment.............      295,790      306,406
                                                         ------------  -----------
      Intangible assets, net............................      345,383      370,307
      Other assets......................................       14,682       24,933
                                                         ------------  -----------
                                                         $  1,268,565  $ 1,291,739
                                                         ============  ===========
      LIABILITIES AND SHAREHOLDERS' EQUITY
      Current liabilities:
        Current maturities of long-term debt............ $        -    $    18,639
        Accrued interest expense........................        2,461        1,304
        Accounts payable and other accrued expenses.....      150,937      115,114
                                                         ------------  ----------- 
          Total current liabilities.....................      153,398      135,057
                                                         ------------  -----------
      Long-term debt, less current maturities.(Notes 4
        and 6)..........................................      578,600      705,040
      Other long-term liabilities.......................      133,626      150,486
      Shareholders' equity:
        Preferred stock, authorized 10,000,000 
          shares, no par value - issued none............          -            -
        Common stock, authorized 100,000,000 shares,        
          $1.00 stated value - issued 61,426,281 
          shares at September 30, 1996 and 50,120,079 
          shares at December 31, 1995.........(Note 4)..       61,426       50,120
        Paid-in capital.................................      279,273      218,156
        Retained earnings...............................       62,242       32,880
                                                         ------------  -----------
        Total shareholders' equity....................        402,941      301,156
                                                         ------------  -----------
                                                         $  1,268,565  $ 1,291,739
                                                         ============  ===========<PAGE>





      See accompanying notes to consolidated financial statements.

</TABLE>
<PAGE>
<TABLE>
<CAPTION>
 

                        FURNITURE BRANDS INTERNATIONAL, INC.
                        CONSOLIDATED STATEMENTS OF OPERATIONS
                     (Dollars in thousands except per share data)
                                     (Unaudited)
        <S>          <C>                                <C>           <C>

                                                      Three Months  Three Months
                                                             Ended         Ended
                                                      September 30, September 30,
                                                              1996          1995
                                                      ------------  ------------
      Net sales...................................... $    417,921  $    258,626

      Costs and expenses:                                         
        Cost of operations...........................      301,667       182,349
                                                                  
        Selling, general and administrative expenses.       69,266        49,721

        Depreciation and amortization................       13,353         9,049
                                                      ------------  ------------
      Earnings from operations.......................       33,635        17,507

      Interest expense...............................       10,592         8,212

      Other income, net..............................          566         1,081 
                                                      ------------  ------------
      Earnings before income tax expense and                      
        extraordinary item...........................       23,609        10,376

      Income tax expense.............................        9,284         4,180 
                                                      ------------- ------------
      Net earnings before extraordinary item.........       14,325         6,196

      Extraordinary item - early extinguishment of
        debt, net of tax benefit....(Note 7).........       (7,417)          -  
                                                      ------------  ------------
      Net earnings................................... $      6,908  $      6,196
                                                      ============  ============
      Net earnings per common share - primary:
        Net earnings before extraordinary item.......       $ 0.22        $ 0.12
        Extraordinary item - early extinguishment
          of debt....................................        (0.11)          -  
                                                            ------        ------
      Net earnings per common share - primary........       $ 0.11        $ 0.12
                                                            ======        ======
      Net earnings per common share - fully diluted:
        Net earnings before extraordinary item.......       $ 0.22        $ 0.12
        Extraordinary item - early extinguishment
          of debt....................................        (0.11)          -  
                                                             -----        ------
      Net earnings per common share - fully diluted..       $ 0.11        $ 0.12
                                                            ======        ======
      Weighted average common and common equivalent
        shares outstanding:
        Primary......................................   64,093,194    50,597,623
                                                      ============  ============
        Fully diluted................................   64,754,201    51,403,855
                                                      ============  ============

      See accompanying notes to consolidated financial statements.
</TABLE>

<PAGE>
<TABLE>
<CAPTION>
                        FURNITURE BRANDS INTERNATIONAL, INC.
                       CONSOLIDATED STATEMENTS OF OPERATIONS
                   (Dollars in thousands except per share data)
                                (Unaudited)
                                                      <C>           <C>

                                                       Nine Months   Nine Months
                                                             Ended         Ended
                                                      September 30, September 30,
                                                              1996          1995
                                                      ------------  ------------
      Net sales...................................... $  1,262,610  $    794,866

      Costs and expenses:                                         
        Cost of operations...........................      913,207       562,479
                                                                  
        Selling, general and administrative expenses.      214,038       149,101

        Depreciation and amortization................       41,411        28,387
                                                      ------------  ------------
      Earnings from operations.......................       93,954        54,899

      Interest expense...............................       35,672        25,409

      Other income, net..............................        1,978         3,352 
                                                      ------------  ------------
      Earnings before income tax expense and
        extraordinary item...........................       60,260        32,842
                                                                  
      Income tax expense.............................       23,467        13,416 
                                                      ------------  ------------
      Net earnings before extraordinary item.........       36,793        19,426

      Extraordinary item - early extinguishment
        of debt, net of tax benefit..(Note 7)........       (7,417)          -  
                                                      ------------  ------------
      Net earnings................................... $     29,376  $     19,426
                                                      ============  ============
      Net earnings per common share - primary:
        Net earnings before extraordinary item.......       $ 0.60        $ 0.38
        Extraordinary item - early extinguishment
          of debt....................................        (0.12)          -  
                                                            ------        ------
      Net earnings per common share - primary........       $ 0.48        $ 0.38
                                                            ======        ======
      Net earnings per common share - fully diluted:
        Net earnings before extraordinary item.......       $ 0.59        $ 0.38
        Extraordinary item - early extinguishment
          of debt....................................        (0.12)          -  
                                                            ------        ------
      Net earnings per common share - fully diluted..       $ 0.47        $ 0.38
                                                            ======        ======
      Weighted average common and common 
        equivalent shares outstanding:
        Primary......................................   61,227,139    50,597,623
                                                      ============  ============
        Fully diluted................................   62,764,804    51,403,855
                                                      ============  ============


      See accompanying notes to consolidated financial statements.

</TABLE>
<PAGE>
<TABLE>
<CAPTION>

                         FURNITURE BRANDS INTERNATIONAL, INC.
                        CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (Dollars in thousands)
                                 (Unaudited)


                                             <C>                <C>

                                              Nine Months      Nine Months
                                                    Ended            Ended
                                             September 30,    September 30,
                                                     1996             1995
                                             ------------     ------------

      Cash Flows from Operating Activities:
       Net earnings....................     $     29,376     $     19,426 
       Adjustments to reconcile net 
        earnings to net cash provided by 
        operating activities:
          Net loss on early extinguishment 
            of debt....................            7,417               -   
           Depreciation of property, plant 
             and equipment..............           32,406           21,087 
           Amortization of intangible and 
             other assets...............            9,005            7,300 
           Noncash interest expense.....            1,756            1,670 
           Increase in receivables......          (16,553)          (4,085)
           Increase in inventories......          (11,300)          (2,386)
           Decrease in prepaid expenses 
            and intangible and other assets..      17,179            2,783 
           Increase in accounts payable, 
            accrued interest expense and other 
            accrued expenses.................      42,502           25,250 
           Decrease in net deferred tax 
            liabilities......................        (605)          (3,173)
           Decrease in other long-term 
            liabilities......................     (16,010)             (13)
                                              -----------       ----------
        Net cash provided by operating 
         activities..........................      95,173           67,859
                                              -----------       ---------- 

      Cash Flows from Investing Activities:
       Proceeds from the disposal of 
         assets.............................        2,140              147 
       Additions to property, plant 
          and equipment.....................      (23,930)         (12,311)
                                              -----------       ----------
       Net cash used by investing activities.     (21,790)         (12,164)
                                              -----------       ----------

      Cash Flows from Financing Activities:
       Payments for debt issuance costs......      (4,630)             -   
       Additions to long-term debt...........     380,000              -    
       Payments of long-term debt............    (524,279)         (23,875)
       Proceeds from the sale of common stock      81,292              -   
       Proceeds from the issuance of common
         stock...............................       9,239              199 
       Payments for the repurchase of common 
         stock warrants......................     (19,961)          (2,789)
                                             ------------       ----------
       Net cash used by financing activities      (78,339)         (26,465)<PAGE>
                                             ------------       ----------
      Net increase (decrease) in cash and 
        cash equivalents....................       (4,956)          29,230
      Cash and cash equivalents at beginning 
        of period...........................       26,412           32,145 
                                             ------------       ----------
      Cash and cash equivalents at end 
        of period........................... $     21,456       $   61,375 
                                             ============       ==========

      Supplemental Disclosure:
       Cash payments for income taxes, net.  $     20,225       $    6,549 
                                             ============       ==========
       Cash payments for interest expense..  $     32,834       $   22,548
                                             ============       ==========


      See accompanying notes to consolidated financial statements.
</TABLE>


<PAGE>





     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
     (Unaudited)



     (1)   The financial statements are unaudited but include all
           adjustments (consisting of normal recurring adjustments) which
           the management of the Company considers necessary for a fair
           presentation of the results of the period.  The results for the
           three months and nine months ended September 30, 1996 are not
           necessarily indicative of the results to be expected for the
           full year.

     (2)   In October 1995, the Financial Accounting Standards Board issued
           SFAS No. 123, "Accounting for Stock-Based Compensation" ("SFAS
           No. 123").  Under SFAS No. 123, companies can either measure the
           compensation cost of equity instruments issued under employee
           compensation plans using a fair value based method, or can
           continue to recognize compensation cost under the provisions of
           Accounting Principles Board Opinion No. 25 ("Opinion No. 25")
           with pro forma disclosures of net income and earnings per share
           as if the fair value method had been applied.  The Company
           adopted SFAS No. 123 as of January 1, 1996 and has elected to,
           as permitted under the statement, continue recognition of
           compensation costs under the provisions of Opinion No. 25 with
           appropriate disclosure, if material.  The effect on net earnings
           for the three-month and nine-month period ended September 30,
           1996 is not material and, accordingly, no disclosure has been
           made.  Further, based on current and anticipated use of stock
           options for the foreseeable future, it is not envisioned that
           the impact of the pronouncement would be material in subsequent
           periods.

     (3)   Inventories are summarized as follows, in thousands:

                                            September 30,    December 31,
                                                    1996            1995
                                            ------------     -----------

               Finished products            $    124,094     $   114,857
               Work-in-process                    54,017          51,259
               Raw materials                     102,866         103,561
                                            ------------     -----------
                                            $    280,977     $   269,677
                                            ============     ===========


     (4)   On March 1, 1996, the Company completed its offering of ten
           million common shares generating net cash proceeds of $81.3
           million which were used to repay long-term debt.  This long-term
           debt payment was applied in reverse order of maturity to the
           term loan "C" facility of the Company's secured credit
           agreement.<PAGE>


     (5)   In February 1996, the Company entered into interest rate swap
           agreements with two financial institutions to reduce the impact
           of changes in interest rates on its floating rate long-term
           debt.  The two agreements, having a total notional principal
           amount of $300.0 million, mature in three years.  The swap
           agreements effectively convert a portion of the Company's
           floating rate long-term debt to a fixed rate.  The Company pays
           the counterparties a fixed rate of 5.14% per annum and receives
           payments based upon the floating three month London interbank
           offered rate (LIBOR). The Company is exposed to credit loss in
           the event of nonperformance by the counterparties; however, the 
           Company does not anticipate nonperformance by the counterparties.

     (6)   On September 6, 1996, the Company refinanced its secured credit
           agreement.  The new secured credit agreement is a five-year,
           reducing revolving credit facility with an initial commitment
           totaling $475.0 million.  The revolving credit facility has no
           mandatory principal payments; however, the commitment is reduced
           to $400.0 million on September 30, 1999, $300.0 million on
           September 29, 2000, with remaining commitment maturing on
           September 15, 2001.

           The revolving credit facility allows for issuance of letters of
           credit and cash borrowings.  Letter of credit outstandings are
           limited to no more than $60.0 million, with cash borrowings
           limited only by the facility's maximum availability less letters
           of credit outstanding.  On September 30, 1996, $365.0 million in
           cash borrowings were outstanding under the revolving credit
           facility.

           Cash borrowings under the revolving credit facility bear
           interest at a base rate or at an adjusted Eurodollar rate plus
           an applicable margin which varies, depending upon the type of
           loan the Company executes.  The applicable margin over the base
           rate and Eurodollar rate is subject to adjustment based upon
           certain financial performance ratios.  At September 30, 1996,
           all cash borrowings were Eurodollar loans having an interest
           rate of 6.375%, which included an applicable margin of 0.875%.

     (7)   In conjunction with the September 6, 1996 refinancing of the
           secured credit agreement, the Company charged to results of
           operations $7.4 million, net of taxes of $4.5 million,
           representing the deferred financing fees and expenses pertaining
           to such credit facilities.  The charge was recorded as an
           extraordinary item.

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

     RESULTS OF OPERATIONS

     Furniture Brands International, Inc. (the "Company") is a major
     manufacturer of residential furniture.  The Company has three primary
     operating subsidiaries; Broyhill Furniture Industries, Inc., The Lane
     Company, Incorporated and Thomasville Furniture Industries, Inc.<PAGE>

     On December 29, 1995, the Company acquired Thomasville Furniture
     Industries, Inc. ("Thomasville").  The transaction was accounted for
     as a purchase and, since the acquisition occurred as of the last
     business day of 1995, has been reflected in the Company's consolidated
     balance sheet as of December 31, 1995.  The Company's results of
     operations for 1995 do not include any of the operations of
     Thomasville.

     Comparison of Three Months and Nine Months Ended September 30, 1996
     -------------------------------------------------------------------
     and 1995
     --------

     Selected financial information for the three months and nine months
     ended September 30, 1996 and 1995 is presented below:

     ($ in millions, except per share data)

                                             Three Months Ended            
                                  -----------------------------------------
                                  September 30, 1996     September 30, 1995
                                  ------------------     ------------------
                                               % of                   % of
                                  Dollars   Net Sales    Dollars  Net Sales
                                  -------   ---------    -------  ---------
     Net sales                    $417.9      100.0%     $258.6     100.0%
     Cost of operations            301.7       72.2       182.4      70.5 
     Selling, general and
      administrative expenses       69.3       16.6        49.7      19.2 
     Depreciation and amortization  13.3        3.2         9.0       3.5 
                                  ------      -----      ------     -----
     Earnings from operations       33.6        8.0        17.5       6.8 
     Interest expense               10.6        2.5         8.2       3.2 
     Other income, net               0.6        0.1         1.1       0.4 
                                  ------      -----      ------     -----
     Earnings before income tax
       expense and extraordinary 
        item                        23.6        5.6        10.4       4.0 
     Income tax expense              9.3        2.2         4.2       1.6 
                                  ------      -----      ------     -----
     Net earnings before 
      extraordinary item          $ 14.3        3.4%     $  6.2       2.4%
                                  ======      =====      ======     =====

     Gross Profit (1)             $107.1       25.6%     $ 70.5      27.3%
     EBITDA (2)                     46.9       11.2        26.5      10.2 <PAGE>



                                              Nine Months Ended            
                                  -----------------------------------------
                                   September 30, 1996    September 30, 1995
                                  -------------------    ------------------
                                               % of                 % of
                                  Dollars   Net Sales    Dollars  Net Sales
                                  --------  ---------    -------  ---------
     Net sales                    $1,262.6    100.0%      $794.9    100.0%
     Cost of operations             913.2      72.3        562.5     70.8 
     Selling, general and
      administrative expenses       214.0      17.0        149.1     18.7 
     Depreciation and amortization   41.4       3.3         28.4      3.6 
                                  -------    ------       ------    -----
     Earnings from operations        94.0       7.4         54.9      6.9 
     Interest expense                35.7       2.8         25.4      3.2 
     Other income, net                2.0       0.2          3.3      0.4 
                                  -------    ------       ------    -----
     Earnings before income tax
      expense and extraordinary 
      item                           60.3       4.8         32.8      4.1 
     Income tax expense              23.5       1.9         13.4      1.7 
                                  -------    ------       ------    -----
     Net earnings before 
      extraordinary item          $  36.8       2.9%      $ 19.4      2.4%
                                  =======    ======       ======    =====
     Gross Profit (1)             $ 320.8      25.4%      $214.3     27.0%
     EBITDA (2)                     135.4      10.7         83.3     10.5 


     (1)   The Company believes that gross profit provides useful
           information regarding a company's financial performance.  Gross
           profit should not be considered in isolation or as an
           alternative to net earnings, an indicator of the Company's
           operating performance, or an alternative to the Company's cash
           flow from operating activities as a measure of liquidity.  Gross
           profit has been calculated by subtracting cost of operations and
           the portion of depreciation associated with cost of goods sold
           from net sales.

                                Three Months Ended       Nine Months Ended
                                      September 30,           September 30,
                                ------------------       ----------------- 
                                  1996      1995           1996      1995 
                                -------    -------       -------    ------
     Net sales                  $417.9     $258.6        $1,262.6   $794.9
     Cost of operations          301.7      182.4           913.2    562.5 
     Depreciation (associated
      with cost of good sold)      9.1        5.7            28.6     18.1 
                                ------     ------        --------   ------ 
     Gross Profit               $107.1     $ 70.5        $  320.8   $214.3 
                                ======     ======        ========   ====== 

     (2)   EBITDA is defined as caring from operations before depreciation and 
           amortization and therefore does not include other income, net, EBITDA
           is not intended to represent cash flows for the period as measured 
           in accordance with generally accepted accounting principles.  Nor 
           has it been presented as an alternative to net income from 
           operations as an indicator of operating performance, and it should
           not be considered in isolation or as a substitute for measures of
           performance prepared in accordance with generally accepted 
           accounting principles.  EBITDA is presented solely as supplemental
           disclosure because the Company believes that it is a good measure
           of the operating cash flow generated by the Company to enable it 
           to make capital expenditures and meet its other obligations.  
           The Company believes that EBITDA may be a better indicator for this 
           purpose than earnings from operations because of the significant
           fresh-start depreciation and amortization charges described 
           herein.  Because all companies and analysts do not calculate
           EBITDA in an identical manner, EBITDA as presented above may not
           necessarily be comparable to similarly-titled measures of other
           companies.


     Three Months Ended September 30, 1996 Compared to Three Months Ended
     --------------------------------------------------------------------
     September 30, 1995
     ------------------

     Net sales for the three months ended September 30, 1996 increased to
     $417.9 million from $258.6 million for the three months ended
     September 30, 1995.  The improved sales performance resulted primarily
     from the acquisition of Thomasville.  Had Thomasville been acquired at
     the beginning of 1995, net sales for the three months ended September
     30, 1996 would have increased 6.7% over those for the three months
     ended September 30, 1995.

     Cost of operations for the three months ended September 30, 1996 was
     $301.7 million, compared to $182.4 million for the three months ended
     September 30, 1995.  The large increase was a result of the Company's
     acquisition of Thomasville.  Cost of operations as a percentage of net
     sales increased from 70.5% for the three months ended September 30,
     1995 to 72.2% for the three months ended September 30, 1996.  This
     increase was due to the acquisition of Thomasville which had higher
     cost of operations as a percentage of net sales than the Company's
     other operating subsidiaries.  Had Thomasville been included on a pro
     forma basis for the three months ended September 30, 1995, cost of
     operations as a percentage of net sales would have been 73.4%.

     Selling, general and administrative expenses increased to $69.3
     million for the three months ended September 30, 1996 from $49.7
     million for the three months ended September 30, 1995.  The large
     increase was a result of the Company's acquisition of Thomasville.  As
     a percentage of net sales, selling, general and administrative
     expenses were 16.6% for the three months ended September 30, 1996
     compared to 19.2% for the three months ended September 30, 1995,
     reflecting the Company's acquisition of Thomasville.

     Depreciation and amortization for the three months ended September 30,
     1996 was $13.3 million, compared to $9.0 million for the three months
     ended September 30, 1995.  The large increase was a result of the
     Company's acquisition of Thomasville.  The amount of depreciation and
     amortization attributable to the "fresh-start" reporting was $3.9
     million and $3.7 million for the three months ended September 30, 1996
     and September 30, 1995, respectively.

     Interest expense for the three months ended September 30, 1996 totaled
     $10.6 million, compared to $8.2 million for the prior year comparable
     period.  The increase in interest expense reflects additional debt
     incurred for the acquisition of Thomasville.<PAGE>






     Other income, net for the three months ended September 30, 1996,
     totaled $0.6 million compared to $1.1 million for the three months
     ended September 30, 1995.  For the three months ended September 30,
     1996, other income consisted of interest on short term investments of
     $0.3 million and other miscellaneous income and (expense) items
     totaling $0.3 million.

     For the three months ended September 30, 1996, the Company provided
     for income taxes totaling $9.3 million on earnings before income tax
     expense and extraordinary item, producing an effective tax rate of
     39.3% compared to an effective tax rate for the prior year comparable
     period of 40.3%.  The effective tax rates for such periods were
     adversely impacted by certain nondeductible expenses incurred and
     provisions for state and local income taxes.

     Net earnings per common share before extraordinary item on a fully
     diluted basis were $0.22 for the three months ended September 30, 1996
     compared with $0.12 for the prior year comparable period.  Weighted
     average shares outstanding used in the calculation of net earnings per
     common share on a primary and fully diluted basis were 64,093,000 and
     64,754,000 in 1996, respectively, and 50,598,000 and 51,404,000 in
     1995, respectively.

     Gross profit for the three months ended September 30, 1996 was $107.1
     million, representing an increase of 51.9% over gross profit for the
     prior year comparable period of $70.5 million.  The increase resulted
     primarily from the acquisition of Thomasville.  The decrease in gross
     profit margin to 25.6% for the three months ended September 30, 1996
     from 27.3% for the comparable period for the prior year was due to the
     acquisition of Thomasville, which had lower gross profit margins than
     the Company's other operating subsidiaries.  Had Thomasville been
     included on a pro forma basis in 1995, gross profit margin would have
     been 24.4% for the three months ended September 30, 1995.

     EBITDA for the three months ended September 30, 1996 was $46.9
     million, representing an increase of 76.9% over EBITDA of $26.5
     million for the comparable period of the prior year.  This increase
     resulted primarily from the acquisition of Thomasville.  EBITDA as a
     percentage of net sales increased to 11.2% for the three months ended
     September 30, 1996 from 10.2% for the comparable period for the prior
     year.  Had Thomasville been included on a pro forma basis for the 1995
     period, EBITDA as a percentage of net sales would have been 9.5% for
     the three months ended September 30, 1995.  This increase in EBITDA
     margin reflects efficient manufacturing activity as well as the
     Company's continuing efforts to enhance profitability.

     Nine Months Ended September 30, 1996 Compared to Nine Months Ended
     -------------------------------------------------------------------
     September 30, 1995
     ------------------

     Net sales for the nine months ended September 30, 1996 increased to
     $1,262.6 million from $794.9 million for the nine months ended
     September 30, 1995.  The improved sales performance resulted primarily<PAGE>





     from the acquisition of Thomasville.  Had Thomasville been acquired at
     the beginning of 1995, net sales for the nine months ended September
     30, 1996 would have increased 4.9% over those for the nine months
     ended September 30, 1995.

     Cost of operations for the nine months ended September 30, 1996 was
     $913.2 million, compared to $562.5 million for the nine months ended
     September 30, 1995.  The large increase was a result of the Company's
     acquisition of Thomasville.  Cost of operations as a percentage of net
     sales increased from 70.8% for the nine months ended September 30,
     1995 to 72.3% for the nine months ended September 30, 1996.  This
     increase was due to the acquisition of Thomasville which had higher
     cost of operations as a percentage of net sales than the Company's
     other operating subsidiaries.  Had Thomasville been included on a pro
     forma basis for the nine months ended September 30, 1995, cost of
     operations as a percentage of net sales would have been 73.3%.

     Selling, general and administrative expenses increased to $214.0
     million for the nine months ended September 30, 1996 from $149.1
     million for the nine months ended September 30, 1995.  The large
     increase was a result of the Company's acquisition of Thomasville.  As
     a percentage of net sales, selling, general and administrative
     expenses were 17.0% for the nine months ended September 30, 1996
     compared to 18.7% for the nine months ended September 30, 1995,
     reflecting the Company's acquisition of Thomasville.

     Depreciation and amortization for the nine months ended September 30,
     1996 was $41.4 million, compared to $28.4 million for the nine months
     ended September 30, 1995.  The large increase was a result of the
     Company's acquisition of Thomasville.  The amount of depreciation and
     amortization attributable to the "fresh-start" reporting was $12.3
     million and $11.8 million for the nine months ended September 30, 1996
     and September 30, 1995, respectively.

     Interest expense for the nine months ended September 30, 1996 totaled
     $35.7 million, compared to $25.4 million for the prior year comparable
     period.  The increase in interest expense reflects additional debt
     incurred for the acquisition of Thomasville.

     Other income, net for the nine months ended September 30, 1996,
     totaled $2.0 million compared to $3.3 million for the nine months
     ended September 30, 1995.  For the nine months ended September 30,
     1996, other income consisted of interest on short term investments of
     $1.1 million and other miscellaneous income and (expense) items
     totaling $0.9 million.

     For the nine months ended September 30, 1996, the Company provided for
     income taxes totaling $23.5 million on earnings before income tax
     expense and extraordinary item, producing an effective tax rate of
     38.9% compared to an effective tax rate for the prior year comparable
     period of 40.9%.  The effective tax rates for such periods were
     adversely impacted by certain nondeductible expenses incurred and
     provisions for state and local income taxes.<PAGE>





     Net earnings per common share before extraordinary item on a fully
     diluted basis were $0.59 for the nine months ended September 30, 1996
     compared with $0.38 for the prior year comparable period.  Weighted
     average shares outstanding used in the calculation of net earnings per
     common share on a primary and fully diluted basis were 61,227,000 and
     62,765,000 in 1996, respectively, and 50,598,000 and 51,404,000 in
     1995, respectively.

     Gross profit for the nine months ended September 30, 1996 was $320.8
     million, representing an increase of 49.7% over gross profit for the
     prior year comparable period of $214.3 million.  The increase resulted
     primarily from the acquisition of Thomasville.  The decrease in gross
     profit margin to 25.4% for the nine months ended September 30, 1996
     from 27.0% for the comparable period for the prior year was due to the
     acquisition of Thomasville, which had lower gross profit margins than
     the Company's other operating subsidiaries.  Had Thomasville been
     included on a pro forma basis in 1995, gross profit margin would have
     been 24.5% for the nine months ended September 30, 1995.

     EBITDA for the nine months ended September 30, 1996 was $135.4
     million, representing an increase of 62.5% over EBITDA of $83.3
     million for the comparable period of the prior year.  This increase
     resulted primarily from the acquisition of Thomasville.  EBITDA as a
     percentage of net sales increased to 10.7% for the nine months ended
     September 30, 1996 from 10.5% for the comparable period for the prior
     year.  Had Thomasville been included on a pro forma basis for the 1995
     period, EBITDA as a percentage of net sales would have been 9.8% for
     the nine months ended September 30, 1995.  This increase in EBITDA
     margin reflects efficient manufacturing activity as well as the
     Company's continuing efforts to enhance profitability.


     FINANCIAL CONDITION AND LIQUIDITY

     Liquidity.  Cash and cash equivalents at September 30, 1996 totaled
     $21.5 million, compared to $26.4 million at December 31, 1995.  For
     the nine months ended September 30, 1996, net cash from operating
     activities totaled $95.2 million.  Net cash used in investing
     activities totaled $21.8 million.  Net cash used in financing
     activities totaled $78.3 million, including the net repayment of
     $144.3 million of long-term debt, the receipt of $81.3 million of net
     proceeds from the sale of common stock pursuant to the March 1, 1996
     equity offering (1996 Company Equity Sale), the receipt of $9.2
     million from the exercise of warrants to purchase shares of common
     stock, $19.9 million for the repurchase of warrants and $4.6 million
     in debt issuance costs associated with the 1996 Refinancing.

     Working capital was $459.3 million at September 30, 1996, compared to
     $455.0 million at December 31, 1995.  The current ratio was 4.0 to 1
     at September 30, 1996, compared to 4.4 to 1 at December 31, 1995.  The
     modest increase in working capital was due to the Company's focus on
     efficient management of individual working capital components.

     As of September 30, 1996, long-term debt, including current<PAGE>





     maturities, totaled $579.4 million compared to $723.7 million at
     December 31, 1995.  This reduction of indebtedness of $144.3 million
     was funded by $81.3 million from the 1996 Company Equity Sale with the
     remainder funded by cash flow from operations and warrant exercise
     proceeds.

     Financing Arrangements.  On September 6, 1996, the Company refinanced
     its Secured Credit Agreement and modified its Receivables
     Securitization Facility (1996 Refinancing).  The Secured Credit
     Agreement replaces a secured credit agreement that had been entered
     into in connection with the acquisition of Thomasville.  The 1996
     Refinancing will result in a substantial reduction in interest
     expense, which at current debt levels will favorably impact annual
     results by approximately $3.7 million, or $0.05 to $0.06 per share. 
     Had the 1996 Refinancing, the 1996 Company Equity Sale and the Series
     1 Warrant repurchases been completed at the beginning of 1996,
     earnings for the nine months ended September 30, 1996 would have
     increased by $0.04 per share.

     The Secured Credit Agreement is a $475.0 million reducing revolving
     credit facility.  The interest rate on borrowings is based on selected
     credit ratios set forth in the Secured Credit Agreement and as of
     September 30, 1996 was 6.375%.  The Secured Credit Agreement allows
     for both the issuance of letters of credit and cash borrowings. 
     Letters of credit are limited to no more than $60.0 million.  Cash
     borrowings are limited to the facility's maximum availability less
     letters of credit outstanding.  As of September 30, 1996 the Company
     had $365.0 million of cash borrowings drawn under the Secured Credit
     Agreement and had excess availability of approximately $84.0 million.
     The Secured Credit Agreement contains customary covenants including
     financial covenants with respect to the Company's leverage and 
     interest coverage.  The leverage (a ratio of net debt to cash flows)
     and interest coverage (a ratio of cash flows to interest expense)
     covenants are the most restrictive covenants contained in the 
     Secured Credit Agreement.  The Company is currently and expects to
     continue to be in compliance with all restrictive covenants in the
     Secured Credit Agreement.

     The Receivables Securitization Facility is a $225.0 million facility
     pursuant to which the Company sells interests in the trade receivables
     of its operating companies to a third party financial institution. 
     The Company accounts for the Receivables Securitization Facility as
     long-term debt.  The Company's cost of borrowing is based on a
     commercial paper index rate plus a program fee and as of September 30,
     1996 was 6.045%.  At September 30, 1996 the Company had approximately
     $17.0 million of excess availability under the Receivables
     Securitization Facility.

     In February 1996, in order to reduce the impact of changes in interest
     rates on its floating rate long-term debt, the Company entered into
     three-year interest rate swap agreements having a total notional
     amount of $300 million.

     The Company believes that the Secured Credit Agreement and the
     Receivables Securitization Facility, together with cash generated from
     operations, will be adequate to meet liquidity requirements for the
     foreseeable future.

     Capital Expenditures.  The Company maintains a significant capital
     expenditure program focusing on increasing manufacturing efficiency
     and expanding capacity as required.  The Company's total capital
     expenditures were $23.9 million, $35.6 million, $21.1 million and<PAGE>





     $30.2 million for the nine months ended September 30, 1996 and the
     years ended December 31, 1995, 1994 and 1993, respectively.  The
     annual figures do not include the capital expenditures of Thomasville
     ($15.2 million, $14.1 million and $10.0 million for the years ended
     December 31, 1995, 1994 and 1993, respectively).  The Company
     estimates that total capital expenditures will be approximately $40.0
     million in both 1996 and 1997.  Significant new projects during the
     past three years included a new upholstery manufacturing facility at
     Action Industries to meet the increased demand for the Company's
     recliners, motion furniture and sleep sofas and a state-of-the-art
     flat line finishing system at Lane.  The capital expenditures for 1995
     include $18.2 million to construct a new state-of-the-art
     particleboard manufacturing facility at Broyhill, which was funded by
     proceeds from an insurance settlement, to replace the Company's
     facility that was destroyed by fire in November 1994.  The Company
     believes that as a result of the availability of excess capacity in
     the Lane and Thomasville manufacturing facilities, the Company will be
     able to pursue its growth strategy over the next several years without
     the necessity of making significant additional capital expenditures to
     expand capacity.<PAGE>





                      PART II OTHER INFORMATION
                      -------------------------


     Item 5.  Other Information

             On September 26, 1996, the Company announced that Wilbert G.
             (Mickey) Holliman, Jr. was elected a director and to the
             office of President and Chief Executive Officer effective
             October 1, 1996.

     Item 6.   Exhibits and Reports on Form 8-K

          (a)  3(a)   Restated Certificate of Incorporation, as amended.

               3(b)   By-Laws of the Company revised and amended to April 
                      23, 1996.

               4(a)   Credit Agreement, dated as of November 17, 1994, as
                      amended and restated as of December 29, 1995, and
                      further amended and restated as of September 6, 1996,
                      among the Company, Broyhill Furniture Industries,
                      Inc., The Lane Company, Incorporated, Thomasville
                      Furniture Industries, Inc., Various Banks, Credit
                      Lyonnais New York Branch, as Documentation Agent,
                      Nationsbank, N.A., as Syndication Agent, and Bankers
                      Trust Company, as Administration Agent.

                4(b)  Amendment No. 1, dated as of June 27, 1996, to the
                      Purchase and Contribution Agreement, dated as of
                      November 15, 1994, as amended and restated as of
                      December 29, 1995, among The Lane Company,
                      Incorporated, Action Industries, Inc., Broyhill
                      Furniture Industries, Inc. and Thomasville Furniture
                      Industries, Inc. as Sellers and Interco Receivables
                      Corp. as Purchaser.

                4(c)  Amendment No. 2, dated as of September 6, 1996, to
                      the Purchase and Contribution Agreement, dated as of
                      November 15, 1994, as amended and restated as of
                      December 29, 1995, and further amended as of June 27,
                      1996, among The Lane Company, Incorporated, Action
                      Industries, Inc., Broyhill Furniture Industries, Inc.
                      and Thomasville Furniture Industries, Inc. as Sellers
                      and Interco Receivables Corp. as Purchaser.

                4(d)  Amendment No. 1, dated as of June 27, 1996, to the
                      Receivables Purchase Agreement, dated as of November
                      15, 1994, as amended and restated as of December 29,
                      1995, among Interco Receivables Corp. as Seller,
                      Atlantic Asset Securitization Corp., as Issuer, and
                      Credit Lyonnais New York Branch, as Agent for the
                      Investors.<PAGE>





                4(e)  Amendment No. 2, dated as of September 6, 1996, to
                      the Receivables Purchase Agreement, dated as of
                      November 15, 1994, as amended and restated as of
                      December 29, 1995, and further amended as of June 27,
                      1996, among Interco Receivables Corp. as Seller,
                      Atlantic Asset Securitization Corp. as Issuer, and
                      Credit Lyonnais New York Branch, as Agent for the
                      Investors.

               10(a)  Employment Agreement, dated as of August 1, 1996,
                      between Action Industries, Inc. and Wilbert G.
                      Holliman, Jr.

               10(b)  Written description of employment agreement between
                      the Company and Wilbert G. Holliman, Jr.

               10(c)  Employment Agreement, dated as of August 1, 1996,
                      between the Company and Lynn Chipperfield.

               10(d)  Employment Agreement, dated as of August 1, 1996,
                      between the Company and David P. Howard.

               10(e)  Employment Agreement, dated as of August 1, 1996,
                      between Broyhill Furniture Industries, Inc. and Brent
                      B. Kincaid.

               10(f)  Employment Agreement, dated as of August 1, 1996,
                      between Thomasville Furniture Industries, Inc. and
                      Frederick B. Starr.

               10(g)  Employment Agreement, dated as of August 1, 1996,
                      between The Lane Company, Incorporated and K. Scott
                      Tyler, Jr.

               11.    Statement re Computation of Net Earnings Per Common
                      Share.

               27.    Financial Data Schedule.

          (b)  A form 8-K was filed on October 18, 1996 containing the
               Company's Press Release of the same date reporting the
               Company's third quarter results.<PAGE>





                                    SIGNATURE


     Pursuant to the requirements of the Securities Exchange Act of 1934,
     the registrant has duly caused this report to be signed on its behalf
     by the undersigned thereunto duly authorized.


                                Furniture Brands International, Inc.
                                          (Registrant)


                                By Steven W. Alstadt                
                                  ----------------------------------
                                   Steven W. Alstadt
                                   Controller and 
                                   Chief Accounting Officer




     Date:  November 6, 1996<PAGE>