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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K
    FOR ANNUAL AND TRANSITION REPORTS PURSUANT TO SECTIONS 13 OR 15(D) OF THE
                        SECURITIES EXCHANGE ACT OF 1934

        [X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                        SECURITIES EXCHANGE ACT OF 1934
                  FOR THE FISCAL YEAR ENDED DECEMBER 31, 2003
                                       OR
        [ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                        SECURITIES EXCHANGE ACT OF 1934

                         Commission file number 1-11735

                              99 CENTS ONLY STORES

             (Exact name of registrant as specified in its charter)

             CALIFORNIA                                  95-2411605

  (State or other Jurisdiction of           (I.R.S. Employer Identification No.)
   Incorporation or Organization)

      4000 UNION PACIFIC AVENUE,                           90023
     CITY OF COMMERCE, CALIFORNIA                        (zip code)
(Address of Principal Executive Offices)


       Registrant's telephone number, including area code: (323) 980-8145
          Securities registered pursuant to Section 12(b) of the Act:

         TITLE OF EACH CLASS       NAME OF EXCHANGE ON WHICH REGISTERED
         -------------------       ------------------------------------
      COMMON STOCK, NO PAR VALUE          NEW YORK STOCK EXCHANGE

        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 Security 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
requirements  for  the  last  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  Registrant's  knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form  10-K. [X]

     Indicate  by  check mark whether the registrant is an accelerated filer (as
defined  in  Exchange  Act  Rule  12b-2).  Yes [X]  No [ ]

     The  aggregate  market  value of Common Stock held by non-affiliates of the
Registrant  on  June 30, 2003 was $2,447,473,692 based on a $34.32 closing price
for  the  Common  Stock  on  such  date.  For  purposes of this computation, all
executive  officers  and  directors  have  been  deemed  to  be affiliates. Such
determination  should  not  be  deemed  to  be  an admission that such executive
officers  and  directors  are,  in  fact,  affiliates  of  the  Registrant.

  Indicate the number of shares outstanding of each of the issuer's classes of
                    stock as of the latest practicable date.
       Common Stock, No Par Value, 72,426,655 Shares as of March 12, 2004

     Portions  of  Part  III  of this report have been incorporated by reference
from  the  Company's  Proxy  Statement for the 2004 Annual Shareholders meeting.

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<PAGE>
<TABLE>
<CAPTION>
                                           TABLE OF CONTENTS


                                                Part I                                               Page
                                                                                                     ----
<S>       <C>                                                                                         <C>
Item 1.   Business                                                                                      3
Item 2.   Properties                                                                                    9
Item 3.   Legal Proceedings                                                                             9
Item 4.   Submission of Matters to a Vote of Security Holders                                          10

                                                Part II

Item 5.   Market for Registrant's Common Stock and Related Stockholder Matters                         11
Item 6.   Selected Financial Data                                                                      11
Item 7.   Management's Discussion and Analysis of Financial Condition and Results of Operations        14
Item 7A.  Quantitative and Qualitative Disclosures About Market Risk                                   22
Item 8.   Financial Statements and Supplementary Data                                                  23
Item 9.   Changes in and Disagreements with Accountants on Accounting and Financial Disclosure         38
Item 9A.  Controls and Procedures                                                                      39

                                                Part III

Item 10.  Directors and Executive Officers of the Registrant                                           39
Item 11.  Executive Compensation                                                                       39
Item 12.  Security Ownership of Certain Beneficial Owners and Management                               39
Item 13.  Certain Relationships and Related Transactions                                               39
Item 14.  Principal Accountant Fees and Services                                                       39

                                                Part IV

Item 15.  Exhibits, Financial Statement Schedules and Reports on Form 8-K                              40
</TABLE>


                                       2
<PAGE>
SPECIAL  NOTE  REGARDING  FORWARD-LOOKING  INFORMATION

     This  Report  contains  statements  that  constitute  "forward-looking
statements"  within  the  meaning of Section 21E of the Exchange Act and Section
27A  of  the  Securities  Act.  The  words  "expect,"  "estimate," "anticipate,"
"predict," "believe" and similar expressions and variations thereof are intended
to  identify  forward-looking  statements. Such statements appear in a number of
places  in  this  filing  and include statements regarding the intent, belief or
current  expectations of 99 Cents Only Stores (the " Company"), its directors or
officers  with respect to, among other things (a) trends affecting the financial
condition  or  results  of  operations  of  the Company and (b) the business and
growth  strategies of the Company. The shareholders of the Company are cautioned
not  to  put  undue  reliance  on  such  forward-looking  statements.  Such
forward-looking  statements are not guarantees of future performance and involve
risks  and  uncertainties,  and  actual results may differ materially from those
projected  in  this  Report,  for  the  reasons,  among others, discussed in the
Section  -  "Management's  Discussion  and  Analysis  of Financial Condition and
Results  of  Operations"  (including  but  not limited to those discussed in the
subsection  titled  "Risk  Factors").  The  Company  undertakes no obligation to
publicly  revise  these  forward-looking  statements  to  reflect  events  or
circumstances  that arise after the date hereof. Readers should carefully review
the  risk factors described in this report and other documents the Company files
from  time  to  time  with the Securities and Exchange Commission, including the
Quarterly  Reports on Form 10-Q and any Current Reports on Form 8-K filed by the
Company.

                                     PART I

ITEM  1.  BUSINESS

     99 Cents Only Stores (the "Company") is a leading deep-discount retailer of
primarily  name-brand  and  consumable general merchandise. The Company's stores
offer a wide assortment of regularly available consumer goods as well as a broad
variety  of  first-quality,  close-out  merchandise.  In 2003, a majority of the
Company's  product  offerings  were  comprised  of  recognizable  name-brand
merchandise  and were regularly available for reorder. As of March 12, 2004, the
Company  operated  194  retail stores with 150 in California, 19 in Texas, 15 in
Arizona  and  10  in  Nevada. These stores have an average size of approximately
21,500  square  feet.  The  Company's 99 Cents Only Stores generated average net
sales  per estimated saleable square foot of $308, which the Company believes is
among  the  highest in the deep-discount convenience store industry, and average
net  sales  per  store  of  $4.9  million for stores open the full year in 2003.

     The  Company opened its first 99 Cents Only Store in 1982 and believes that
it  operates the nation's oldest existing single price point general merchandise
chain.  The Company competes in the deep-discount industry, which it believes is
one of the fastest growing retail sectors in the United States. In line with the
Company's business strategy, the Company has significantly increased the rate of
store  expansion  over  the last eight fiscal years. The Company expanded its 99
Cents  Only  Stores from 36 stores and 332,100 estimated saleable square feet at
December  31, 1995 to 189 stores and 3,190,528 estimated saleable square feet at
December  31,  2003,  representing a compound annual growth rate ("CAGR") of 23%
and  33%,  respectively.  Historically,  the Company's 99 Cents Only Stores have
been  profitable  within  their first year of operation. Through March 12, 2004,
the  Company had opened 6 new stores and closed one store. It also plans to open
an  additional 42 new stores during the remainder of the year. The Company plans
to continue its store square footage expansion in 2004 at a targeted growth rate
of  25%  per year. The Company estimates that the California, Texas, Arizona and
Nevada  markets  have  the  potential  for  over  425, 99 Cents Only Stores. The
Company  intends  to continue to expand in California, Texas, Arizona and Nevada
in  2004  and  2005.  See "Growth Strategy" for further discussion of geographic
expansion  plans.

     The  Company  also sells merchandise through its Bargain Wholesale division
at prices generally below normal wholesale levels to retailers, distributors and
exporters.  Bargain  Wholesale  complements  the  Company's retail operations by
allowing the Company to purchase in larger volumes at more favorable pricing, to
be  exposed  to  a  broader  selection  of  opportunistic  buys  and to generate
additional  sales  with  relatively  small  incremental  increases  in operating
expenses,  contributing  to  strong  overall  operating margins for the Company.
Bargain Wholesale represented 5.3% of the Company's net sales in 2003.

INDUSTRY

     The  Company  participates  primarily in the deep-discount retail industry,
with  its 99 Cents Only Stores. Deep-discount retail is distinguished from other
retail  formats  by  the  purchase  of  close-out  and  other  special-situation
merchandise  at  prices  substantially  below  original  wholesale cost, and the
subsequent  sale  of  this  merchandise  at  prices  significantly below regular
retail.  This  results in a continually changing selection of specific brands of
products.  The Company believes that the deep-discount retail industry is one of
the  fastest  growing  retail  sectors  in  the  United  States.

     The sale of close-out or special-situation merchandise develops in response
to  the  need of manufacturers, wholesalers and others to distribute merchandise
outside  their  normal  channels.  Close-out  or  special-situation  merchandise
becomes  available  for  a  variety  of  reasons,  including  a  manufacturer's
over-production,  discontinuance  due  to  a  change  in  style,  color,  size,
formulation  or packaging, the inability to move merchandise effectively through
regular  channels,  reduction  of  excess seasonal inventory, discontinuation of
test-marketed  items  and  the  financial  needs  of  the  manufacturer.

     Many  deep-discount  retailers  also sell merchandise that can be purchased
from  a manufacturer or wholesaler on a regular basis. Although this merchandise
can  usually  be purchased at less than original wholesale and sold below normal
retail, the discount, if any, is generally less than with close-out merchandise.
Deep-discount  retailers sell regularly available merchandise to ensure a degree
of  consistency  in  their  product  offerings  and to establish themselves as a
reliable  source  of  basic  goods.


                                       3
<PAGE>
BUSINESS  STRATEGY

     The  Company's  goal  is  to  continue  to provide significant value to its
customers  on  a  wide  variety  of  consumable merchandise in an exciting store
environment.  The  Company's  strategies  to  achieve  this  goal  include  the
following:

     Focus  on  "Name-Brand"  Consumables.  The  Company  strives  to exceed its
customers'  expectations  of  the  range  and  quality  of name-brand consumable
merchandise  that  can  be  purchased  for  99  cents.  During 2003, the Company
purchased merchandise from more than 999 suppliers, including Colgate-Palmolive,
Eveready  Battery,  General  Electric,  General  Mills, Gerber Products, Hershey
Foods,  Johnson  &  Johnson,  Kellogg's,  Kraft,  Mattel, Mead, Nabisco, Nestle,
Procter  &  Gamble,  Revlon,  SmithKline  Beecham  and  Unilever.

     Broad  Selection  of  Regularly Available Merchandise. The Company's retail
stores  offer consumer items in each of the following staple product categories:
food  (including  frozen  and  deli  items),  beverages, health and beauty aids,
household  products (including cleaning supplies, paper goods, etc.), housewares
(including  glassware,  kitchen  items,  etc.),  hardware,  stationary and party
goods,  seasonal  goods,  baby  products  and  toys,  giftware, pet products and
clothing.  The Company supplements its name-brand merchandise with private-label
items.  By  consistently offering a wide selection of basic household consumable
items,  the  Company  attempts  to encourage customers to shop at the stores for
their  everyday  household  needs,  which  the  Company believes leads to a high
frequency  of  customer  visits.

     Attractively  Merchandised  and Well-Maintained Stores. The Company strives
to  provide  its  customers  an  exciting  shopping  experience  in
customer-service-oriented  stores, which are attractively merchandised, brightly
lit and well-maintained. The Company's stores are merchandised and laid out in a
"supermarket"  format  with  items  in  the  same  category grouped together. In
addition,  the  shelves  are  restocked  as  needed  during the day. By offering
merchandise  in  an attractive, convenient and familiar environment, the Company
believes  its  stores  appeal  to  a  wide  demographic  of  customers.

     Strong  Long-Term  Supplier Relationships. The Company believes that it has
developed  a  reputation  as a leading purchaser of name-brand, re-orderable and
close-out  merchandise  at discount prices through its ability to make immediate
buying  decisions, experienced buying staff, willingness to take on large volume
purchases and take possession of merchandise immediately, ability to pay cash or
accept  abbreviated  credit  terms, reputation for prompt payment, commitment to
honor  all  issued  purchase orders and willingness to purchase goods close to a
target season or out of season. The Company's relationship with its suppliers is
further  enhanced  by  its  ability  to  minimize  channel  conflict  for  the
manufacturer  by quickly selling name-brand merchandise without, if requested by
the  supplier,  advertising  or  wholesaling the item. Additionally, the Company
believes  it  has  well-maintained,  attractively  merchandised stores that have
contributed  to  a  reputation among suppliers for protecting their brand image.

     Complementary  Bargain  Wholesale  Operation. Bargain Wholesale complements
the  Company's  retail  operations by allowing the Company to purchase in larger
volumes  at  more  favorable  pricing,  to  be exposed to a broader selection of
opportunistic  buys  and  to  generate  additional  sales  with relatively small
incremental  increases  in  operating  expenses,  contributing to strong overall
operating  margins for the Company. Net sales in the Company's Bargain Wholesale
division  were  $46.0 million in 2003. The growth strategy for Bargain Wholesale
is  to focus on large domestic and international accounts and expansion into new
geographic markets. The Company maintains showrooms in New York City and Chicago
to  support  its  Bargain  Wholesale  operation,  which is based in Los Angeles.

     Adherence  to  Disciplined  Cost Controls and Savvy Purchasing. The Company
believes  it  is  able  to  provide  its  customers with significant value while
maintaining  strong operating margins through an adherence to a disciplined cost
control  program.  The Company purchases merchandise at substantially discounted
prices  as a result of its buyers' knowledge, experience and negotiating ability
and  its  established  reputation  among its suppliers. The Company applies this
same  approach to its relationships with other vendors and strives to maintain a
lean  operating  environment  focused  on  increasing  net  income.

     Focus on Larger Stores in Convenient Locations. The Company's 99 Cents Only
Stores are conveniently located in freestanding buildings, neighborhood shopping
centers  (anchored  by  99  Cents  Only Stores or co-anchored with a supermarket
and/or  a  drug  store),  regional shopping centers or downtown central business
districts  where  the  Company  believes  consumers  are more likely to do their
regular  household  shopping.  The  Company's 194 existing 99 Cents Only Stores,
average  approximately  21,450  gross  square feet. From January 1, 1999 through
December  31,  2003,  the  Company  has opened 130 new stores with an average of
approximately 23,500 gross square feet and currently targets new store locations
between  18,000 and 28,000 gross square feet. The Company's larger 99 Cents Only
Stores  allow  a  more  effective  display of a wider assortment of merchandise,
carry  deeper  stock  positions  and  provide customers with a more inviting and
convenient  environment  that  the Company believes encourages customers to shop
longer  and buy more. The Company's decision to target larger stores is based in
part  on  the  higher  average  annual  net sales per store and operating income
typically  achieved  by  these  stores.  In the past, as part of its strategy to
expand  retail  operations, the Company has at times opened larger new stores in
close  proximity  to existing stores where the Company determined that the trade
area  could  support  a  larger  store. In some of these situations, the Company
retained  its  existing  store so long as it continued to contribute store-level
operating  income.  While  this  strategy  was designed to increase revenues and
store-level  operating  income, it has had a negative impact on comparable store
net  sales  as some customers migrated from the existing store to the larger new
store.  The  Company  believes  that  this  strategy has impacted its historical
comparable  sales  growth.

     Experienced  Management  Team and Depth of Employee Option Grants. 99 Cents
Only  Stores'  management  team  has  many  years  of  retail experience and has
demonstrated  its skills through a proven track record of financial performance.
The  Company's  management  strongly  believes  that  employee  ownership of the
Company's  stock  helps  build employee pride in the stores, which significantly
contributes  to  the success of the Company and its operations. Accordingly, all
members  of the Company's management (other than David Gold, the Company's Chief
Executive  Officer,  Howard  Gold,  Senior  Vice President of Distribution, Jeff
Gold,  Senior  Vice  President  of  Real  Estate  and  Information Systems, Eric
Schiffer,  President  and Karen Schiffer, Senior Buyer) and almost all employees
with  tenure of more than six months with the Company receive an annual


                                       4
<PAGE>
grant  of  stock  options. As of December 31, 2003, the Company's employees held
options  to  purchase an aggregate of 4,428,672 shares, or 6.1% of the shares of
Common  Stock  on  a  fully  diluted  basis.

GROWTH  STRATEGY

     Management believes that future growth will primarily result from new store
openings  facilitated  by  the  following:

     Growth in Existing Territories. As of March 12, 2004 the Company has 194 99
Cents  Only Stores. There are 150 stores located in California, 19 in Texas, and
15  in  Arizona  and  10 in Nevada. By continuing to develop store growth in its
current  markets,  the  Company  believes it can leverage its brand awareness in
these  regions  and  take  advantage  of its existing warehouse and distribution
facilities,  regional  advertising  and  other  management  and  operating
efficiencies.  The Company plans to open 48 new 99 Cents Only Stores in 2004. Of
the  48  planned  new  stores,  approximately  15  new stores will be located in
California,  26  in  Texas,  six  in  Arizona and one in Nevada. The Company had
opened  6  new  stores  and  closed one California store through March 12, 2004.
Three  stores  were  in  California, 2 were in Texas and one was in Arizona. The
Company  plans  to  continue  its  store  square  footage expansion in 2004 at a
targeted  rate  of  25%  per  year.  The  Company  estimates that the markets in
California,  Texas,  Arizona and Nevada have the potential for over 425 99 Cents
Only  Stores.

     Continued  Expansion  into Texas. On February 4, 2003 the Company announced
the  purchase of a 741,000 square foot modern distribution center in the Houston
area,  to  service  its  store  expansion  in  Texas,  started  in mid 2003. The
distribution  facility  was  acquired for $23 million cash and came fully racked
including  an  automated  pick  to  belt  conveyor  system.  It  also  contained
refrigerated  and  frozen  storage  space. The Company installed the "High Jump"
supply  chain management system in this warehouse and opened the first stores in
Houston  Texas on June 19, 2003. As of March 12, 2004, the Company had opened 18
new  stores  in  the  Houston  area  and one in Dallas. The Texas stores average
21,400  sellable  square  feet, which is similar in size to new stores opened in
Northern California. Since January 1999 new stores opened average 18,500 salable
square  feet.  The Company believes Texas has the potential for over 150 stores.
The Company plans to add approximately 26 new stores in Texas in 2004.

     Portable Format Facilitates Geographic Expansion. The Company believes that
its  concept  of  consistently  offering  a  broad  selection  of  name-brand
consumables,  at value pricing, in a convenient store format is portable to most
other  densely  populated  areas  of  the country. In November 1999, the Company
opened  its  first  99  Cents Only Stores outside the state of California in Las
Vegas,  Nevada  and now has a total of 10 stores in Nevada, 15 in Arizona and 19
in  Texas.

     Acquisitions.  The  Company  considers  lease  acquisition  or  purchase
opportunities as they become known to the Company and may make acquisitions of a
chain,  or  chains,  of  clustered  retail  sites  in densely populated regions,
primarily  for  the  purpose  of  acquiring  favorable  locations.

RETAIL  OPERATIONS

     The  Company's retail stores offer customers a wide assortment of regularly
available consumer goods, as well as a broad variety of first-quality, close-out
merchandise,  generally  at  a  significant  discount  from  normal  retail. All
merchandise  sold  in the Company's 99 Cents Only Stores retail stores sells for
99  cents  per  item  or  99  cents  for  two  or  more  items.

     The  following  table  sets  forth relevant information with respect to the
growth of the Company's existing 99 Cents Only Stores operations (dollar amounts
in  thousands,  except  sales  per  square  foot):

<TABLE>
<CAPTION>
                                                                                  YEAR ENDED DECEMBER 31,
                                                             ---------------------------------------------------------------
                                                                   1999         2000         2001         2002         2003
                                                             -----------  -----------  -----------  -----------  -----------
<S>                                                          <C>          <C>          <C>          <C>          <C>

99 Cents Only Stores net retail sales                        $  312,306   $  402,071   $  522,019   $  663,983   $  816,348
99 Cents Only Stores annual net sales growth rate                  30.7%        28.7%        29.8%        27.2%        22.9%
99 Cents Only Stores store count at beginning of year                64           78           98          123          151
New stores                                                           18           20           26           28           38
Stores closed                                                       4(a)           -          1(a)           -            -
                                                             -----------  -----------  -----------  -----------  -----------
Total store count at year-end                                        78           98          123          151          189
Average 99 Cents Only Stores net sales per store open the
full year(b)                                                 $    4,433   $    4,487   $    4,647   $    4,750   $    4,906
Estimated saleable square footage at year-end for 99 Cents
Only Stores                                                   1,102,369    1,424,280    1,892,949    2,428,681    3,190,528
Average net sales per estimated saleable square foot(b)      $      332   $      318   $      319   $      309   $      308
Change in comparable 99 Cents Only Stores net sales                 6.1%         2.0%         5.9%         3.2%         5.4%
<FN>
(a)  Stores closed due to relocation to a larger nearby site.

(b)  For stores open for the entire fiscal year.
</TABLE>

     Merchandising.  All  of  the  Company's  stores  offer  a  broad variety of
first-quality,  name-brand  and  other  close-out  merchandise as well as a wide
assortment  of  regularly  available  consumer goods. The Company also carries a
line  of  private  label consumer products made exclusively for the Company. The
Company  believes  that  the  success of its 99 Cents Only Stores concept arises
from  the  value  inherent  in selling primarily name-brand


                                       5
<PAGE>
consumables,  most  of  which  retail elsewhere from $1.19 to $9.99, for only 99
cents per item or group of items. Each store typically carries over six thousand
different  stock  keeping  units  (SKU).

     Although  a  majority  of  the  merchandise  purchased  by  the  Company is
available  for  reorder,  the  mix  of specific brands of merchandise frequently
changes,  depending  upon  the  availability  of  close-out  and  other
special-situation  merchandise at suitable prices. Since commencing its closeout
purchasing  strategy  in  1976,  the  Company  has not experienced difficulty in
obtaining name brand closeouts as well as re-orderable merchandise at attractive
prices.  Management  believes  that  continuously  changing specific name-brands
found  in  its  stores  from  one week to the next encourages impulse and larger
volume  purchases,  results  in  customers shopping more frequently and helps to
create  a  sense  of  urgency,  awareness  and  excitement. Unlike many discount
retailers,  the  Company  rarely imposes limitations on the quantity of specific
items  that  may  be  purchased  by  a  single  consumer.

     The  Company  targets  value-conscious  consumers  from  a  wide  range  of
socio-economic  backgrounds  with diverse demographic characteristics. Purchases
are  by cash, credit or debit card. The Company's stores do not accept checks or
manufacturers'  coupons.  The  Company's  stores are open every day with opening
hours  designated  to  meet  the  needs  of  family  consumers.

     Store  Size,  Layout  and  Locations. As of March 12, 2004, the Company had
194,  99  Cents  Only  Stores  averaging approximately 21,500 gross square feet.
Since January 1, 1999, the Company has opened 130 new stores that average 23,500
gross  square  feet and currently targets new store locations between 18,000 and
28,000  gross square feet. The Company's larger 99 Cents Only Stores allow it to
more  effectively  display a wider assortment of merchandise, carry deeper stock
positions  and provide customers with a more, what management believes, inviting
and  convenient  environment  that  encourages  customers to shop longer and buy
more.  The Company's decision to target larger stores is based in part on higher
average  annual store revenues typically achieved by these stores.

     The  Company's  stores  are conveniently located in freestanding buildings,
neighborhood  shopping  centers (anchored by 99 Cents Only Stores, a supermarket
and/or  a  drug  store),  regional shopping centers or downtown central business
districts  where  the  Company  believes  consumers  are more likely to do their
regular  household  shopping.

     The  Company  strives to provide stores that are attractively merchandised,
brightly  lit,  well-maintained,  "destination" locations. The layout of each of
the  Company's  stores is customized to the actual size and configuration of the
individual location. The interior of each store is, however, designed to reflect
a  uniform  format,  featuring  attractively  displayed  products  in  windows,
consistent  merchandise  display  techniques,  bright  lighting,  lower shelving
height  that  allows  unobstructed  visibility throughout the store, distinctive
color  scheme,  interior and exterior signage and customized check-out counters,
floors,  price  tags, shopping carts and shopping bags. The Company emphasizes a
strong  visual presentation in all key traffic areas of the store. Merchandising
displays  are  maintained  throughout  the  day,  change  frequently  and  often
incorporate  seasonal  themes. The Company believes that due to the continuously
changing  brand-names,  the  lower  shelving  height  and  the  absence of aisle
description  signs,  the  typical  customer  tends  to  shop  the  whole  store.

     As  of  December  31, 2003 the Company leased 159 of its 189, 99 Cents Only
Stores  retail  locations  and  owned  30 store locations. The Company typically
seeks  leases  with  an  initial five-year to ten-year term and with one or more
five-year  renewal  options.  See  "Item  2  Properties." The Company identifies
potential  sites  through  a  network  of contacts within the brokerage and real
estate communities, information provided by vendors, customers and employees and
through  other  efforts  of  the Company's real estate department. Except for 10
relocations  to  larger stores, and one store closed due to a fire and one other
store  closed  due to eminent domain, the Company has never closed any of its 99
Cents  Only  Stores.

     Store  Management.  The  Company  employs  32  district  managers and three
regional managers responsible for store operations. The regional managers report
to  the  Company's vice president of retail operations. Each district manager is
responsible for up to seven stores with the store managers reporting to district
managers.  Also,  reporting  to  each  district  manager  is  one  merchandising
supervisor. Typically the Company's stores are staffed with a manager and two or
three  assistant  managers.  Store  managers  and assistant managers train store
employees  and  implement  Company policy. District managers visit each store in
their  district  periodically  and  focus  ensuring store management is properly
implementing  the  Company's  policies, operations and merchandising philosophy.
District  managers  also  help  train  store  management.  Additionally the Vice
President  of retail store administration supervises a group of manager trainers
as  well  as  a  management  training  school located at the Company's corporate
offices.

     Advertising.  Advertising  expenditures were $3.4 million, $3.1 million and
$3.8  million  for  2001, 2002 and 2003, respectively, or 0.6%, 0.4% and 0.4% of
net  sales,  respectively.  The  Company  manages  its  advertising  without the
assistance  of  an  outside  agency.  The  Company allocates the majority of its
advertising budget to newspaper and radio advertising. The Company's advertising
strategy  emphasizes  the  offering  of  nationally  recognized,  name-brand
merchandise  at  significant  savings.  The  Company  minimizes  its advertising
expenditures  by an efficient implementation of its advertising program combined
with  word-of-mouth  publicity,  locations  with  good  visibility and efficient
signage.  Because  of  the  Company's  distinctive  grand  opening  promotional
campaign,  which  includes the sale of nine televisions for 99 cents each, grand
openings  often  attract long lines of customers and receive media coverage. The
Company  believes  that  one  of  its  biggest challenges is attracting affluent
customers  to  shop  its  stores.  The  Company  occasionally uses a direct mail
campaign  for  new  customers  who  own  homes  in  more  upscale neighborhoods.

BARGAIN  WHOLESALE

     Bargain  Wholesale  conducts  its  wholesale  operations through its 15,000
square foot product showroom located at the Company's warehouse and distribution
facility.  The  Company's  showrooms  in  New  York and Chicago also continue to
support  Bargain  Wholesale's  operations.  In  2003,  Bargain  Wholesale  sold
merchandise  to  other  wholesalers,  small  local retailers, large regional and
national  retailers  and  exporters.  During


                                       6
<PAGE>
2003, no single customer accounted for more than 4.0% of Bargain Wholesale's net
sales.  The Company advertises its wholesale operations primarily through direct
mail.  The  Company  plans to expand its wholesale operations by focusing on the
needs  of  large  domestic  and  international  accounts,  expansion  into  new
geographic  markets,  increasing  its  marketing  and  promotional  programs,
increasing  the  number  of  trade  shows  at which it exhibits, focusing on its
showrooms  in  Chicago  and  New  York  City,  enhancing  customer  service  and
aggressively  contacting  its  customers  on  a  more  frequent  basis  through
telephone,  facsimile  and  mail.

     The Company's wholesale product line is substantially similar to its retail
product  line.  Bargain  Wholesale  provides  merchandise  for  the  "dollar"
promotional  aisles  of  certain supermarkets and drugstores. The Company offers
15-day  payment  terms to its Bargain Wholesale customers who meet the Company's
credit  standards. Customers located abroad, certain smaller customers or others
who  do  not  meet  the  Company's credit standards must pay cash upon pickup or
before  shipment  of  merchandise.

     Bargain  Wholesale  complements the Company's retail operations by allowing
the  Company  to  purchase  in  larger  volumes at more favorable pricing, to be
exposed  to a broader selection of opportunistic buys and to generate additional
net  sales  with  relatively  small  incremental increases in operating expenses
contributing  to  strong overall margins for the Company. Bargain Wholesale also
allows  the  Company to purchase goods which it would not otherwise purchase for
distribution  through  its  99 Cents Only Stores and provides the Company with a
channel by which it may distribute merchandise at prices other than 99 cents. In
2004,  the  Company  plans  to  open  a showroom in its Katy, Texas distribution
center.

PURCHASING

     The  Company's purchasing department staff consists of 13 buyers managed by
the  Company's  Vice  President  of  Purchasing.  The  Company's Chief Executive
Officer  also participates in the Company's purchasing activities. The Company's
buyers  purchase  for  99  Cents  Only Stores and Bargain Wholesale. The Company
believes a primary factor contributing to its success is its ability to identify
and  take  advantage of opportunities to purchase merchandise with high customer
interest  at  lower than regular wholesale prices. The Company purchases most of
its  merchandise  directly from the manufacturer. The Company's other sources of
merchandise  include  wholesalers,  manufacturers'  representatives,  importers,
barter  companies,  auctions,  professional  finders  and  other  retailers. The
Company  develops  new  sources  of  merchandise primarily by attending industry
trade  shows,  advertising,  marketing  brochures  and  referrals.

     The Company has no continuing contracts for the purchase of merchandise and
must continuously seek out buying opportunities from both its existing suppliers
and  new  sources.  No  single  supplier  accounted  for  more  than 2.3% of the
Company's  total  purchases  in  2003.  During  2003,  the  Company  purchased
merchandise  from  more  than  999 suppliers, including Colgate-Palmolive, Dial,
Eveready  Battery,  General  Electric,  General  Mills, Gerber Products, Hershey
Foods,  Johnson  &  Johnson,  Kellogg's,  Kraft,  Mattel, Mead, Nabisco, Nestle,
Pfizer,  Procter  & Gamble, Revlon, and SmithKline Beecham and Unilever. Many of
these  companies have been supplying products to the Company in excess of twenty
years.

     A  significant  portion of the merchandise purchased by the Company in 2003
was close-out or special-situation merchandise. The Company has developed strong
relationships  with many manufacturers and distributors who recognize that their
special-situation  merchandise can be moved quickly through the Company's retail
and  wholesale  distribution channels. The sale of closeout or special-situation
merchandise  develops  in response to the need of manufacturers, wholesalers and
others  to  distribute  merchandise outside their normal channels. The Company's
buyers search continuously for close-out opportunities. The Company's experience
and expertise in buying merchandise has enabled it to develop relationships with
many  manufacturers  that often offer some or all of their close-out merchandise
to  the  Company  prior to attempting to sell it through other channels. The key
elements  to  these  supplier relationships include the Company's (i) ability to
make  immediate  buy decisions, (ii) experienced buying staff, (iii) willingness
to  take  on  large  volume  purchases  and  take  possession  of  merchandise
immediately,  (iv)  ability  to pay cash or accept abbreviated credit terms, (v)
reputation  for  prompt  payment,  (vi)  commitment to honor all issued purchase
orders  and  (vii) willingness to purchase goods close to a target season or out
of  season.  The Company believes the relationship with its suppliers is further
enhanced  by  its  ability  to minimize channel conflict for the manufacturer by
quickly  selling  name-brand  merchandise without, if requested by the supplier,
advertising  or  wholesaling  the  item.

     In 2003, re-orderable merchandise accounted for a majority of the Company's
purchases.  The  Company's  strong  relationships  with  many  manufacturers and
distributors,  along  with its ability to purchase in large volumes, also enable
the  Company  to  purchase re-orderable name-brand goods at discounted wholesale
prices.  The  Company  focuses  its  purchases  of re-orderable merchandise on a
limited  number  of  SKUs,  which  allows the Company to make purchases in large
volumes.

     The  Company is continuously developing new private label consumer products
to  broaden  the  assortment  of merchandise that is consistently available. The
Company  also  has  an  in-house  import  operation,  which  primarily purchases
re-orderable  merchandise.  The  Company imports products from various European,
South American and Asian countries. Merchandise directly imported by the Company
accounted  for  approximately  2.3%  of total merchandise purchased in 2003. The
Company  primarily  imports  merchandise in product categories which the Company
believes  are  not  brand  sensitive  to  consumers,  such  as  kitchen  items,
house-wares,  toys,  seasonal  products,  pet-care  and  hardware.

WAREHOUSING  AND  DISTRIBUTION

     The  Company  owns  an  880,000  square  foot,  single  level warehouse and
distribution facility located on approximately 23 acres in the City of Commerce,
California. The Company's headquarters are located in this facility. The Company
also  leases an additional 180,000 square foot of warehouse storage space almost
adjacent  to  its main distribution facility. In 2003, the Company purchased two
additional  distributions centers. (i) on January 28, 2003 the Company completed
its  purchase of a 741,000 square foot distribution center in the Houston, Texas
area, to  service  its  planned store expansion in Texas in 2003 and beyond. The
facility was acquired for $23 million in cash and contains built in refrigerated
and  frozen  storage space. (ii) on December 31, 2003, the Company completed the
purchase  of  a 66,000 square foot deli & frozen distribution center in the City
of  Commerce.  The  facility  was acquired for $8.4 million in cash. Most of the
Company's  merchandise is shipped by truck directly from manufacturers and other


                                       7
<PAGE>
suppliers  to the Company's warehousing and distribution facilities. The Company
maintains  a fleet of vehicles, which are used to deliver merchandise to many of
its  Southern  California  stores (both  by  Company  employed truck drivers and
contract employees). Full truck deliveries are made from its distribution center
to  each  store  typically three or more times a week. Product is delivered to a
store the day after the store places a scheduled order. The Company utilizes its
internal  fleet  and  outside  carriers  and  contracted or owner operated truck
drivers  by a combination of filling outbound trucks to capacity and instituting
a  backhaul program whenever possible. The Company also uses outside carriers to
pick  up  shipments  at  local  ports  and rail yards. The size of the Company's
distribution  centers  and  warehouses allows storage of bulk one-time close-out
purchases  and seasonal or holiday items without incurring additional costs. The
Company  also  uses common carriers to deliver to all stores outside of Southern
California  including  its  stores  in  Texas,  Arizona  and Nevada. The Company
believes  that its current warehouse and distribution facilities will be able to
support  distribution to approximately 225 stores within an approximate 500 mile
radius.  There  can  be no assurance that the Company's existing warehouses will
provide adequate storage space for the Company's long-term storage needs.

INFORMATION  SYSTEMS

     In  2003,  the  Company completed the installation of Highjump's "Warehouse
Advantage"  Warehouse  Management System in its Katy, Texas Distribution Center.
The Highjump system utilizes radio frequency technology including Voice Directed
Picking  from  Voxware,  which increases picking accuracy and delivers real time
inventory  to  the  Company's  Unix based Inventory system. The Company plans to
begin  installation  of the Highjump Warehouse Management System in its Commerce
facility in 2004. The Company operates financial, accounting, human resource and
payroll system using Lawson Software's Financial and Human Resource Suites on an
INFORMIX  database  running  on  an  IBM UNIX operating system. The Company also
operates  a separate IBM UNIX based inventory control system developed in house.
The  Company's proprietary store ordering system, which utilizes radio frequency
hand held scanning devices in each store, was upgraded in 2003. This system also
has  improved  the  overall  order  processing  turn  around time as well as the
inventory  availability  in  the  stores and is processed using a back office PC
system  at  each retail location. The Company utilizes a Wide Area Network (WAN)
for  voice  and  data  communications  among  the  stores, the warehouse and the
administrative  functions. The Company's Point of Sale System (POS) continued to
be  upgraded  in  2003  as well. The system has expedited the customer check out
process and provided product category sales data necessary to better service the
Company's customers by improving the information about the in-stock inventory at
the  individual store level. The Company's information systems staffing consists
of  21  employees.  The Company believes that its management information systems
and inventory control systems along with future initiatives to upgrade warehouse
management  systems will be adequate to support the Company's current needs. The
Company intends to continue to enhance its systems to support its future planned
store  growth  and  to  take  advantage  of  new  proven  technology.

COMPETITION

     The Company faces competition in both the acquisition of inventory and sale
of  merchandise  from  other  wholesalers,  discount  stores, single price point
merchandisers,  mass  merchandisers,  food markets, drug chains, club stores and
other  retailers.  Industry competitors for acquiring close-out merchandise also
include  a  large  number  of  privately held companies and individuals. In some
instances  these  competitors  are  also  customers  of  the  Company's  Bargain
Wholesale  division.  There is increasing competition with other wholesalers and
retailers,  including other deep-discount retailers, for the purchase of quality
close-out  and  other  special-situation  merchandise. Some of these competitors
have  substantially  greater  financial  resources  and  buying  power  than the
Company.  The Company's ability to compete will depend on many factors including
the  success of its purchase and resale of such merchandise at lower prices than
the competition. The Company may face intense competition in the future from new
entrants  in the deep-discount retail industry, among others, that could have an
adverse effect on the Company's business and results of operations.

EMPLOYEES

     At  December 31, 2003, the Company had 7,620 employees: 6,828 in its retail
operation,  554 in its warehouse and distribution facility, 224 in its corporate
offices  and  14  in  its  Bargain  Wholesale  division.  None  of the Company's
employees  is  party  to  a  collective bargaining agreement (although the truck
drivers  in the Company's main California warehouse (approximately 56 employees)
recently  elected to be represented by a union). The Company considers relations
with  its  employees  to be good. The Company offers certain benefits, including
health  insurance,  employee discount purchase plan, 401(k) benefits to its full
time  employees  and  an  executive  deferred  compensation plan. All members of
management (other than David Gold, the Company's Chief Executive Officer, Howard
Gold, Senior Vice President of Distribution, Jeff Gold, Senior Vice President of
Real  Estate  and  Information  Systems,  Eric  Schiffer,  President  and  Karen
Schiffer,  Senior  Buyer)  and almost all full-time employees with tenure of six
months,  receive  an  annual  grant  of  stock  options.

TRADEMARKS  AND  SERVICE  MARKS

     "99  Cents  Only  Stores",  "99  Cents", "Rinso" and "Halsa" are registered
trademarks  of  the  Company  and  are  listed  on  the United States Patent and
Trademark  Office Principal Register. "Bargain Wholesale" is a service mark used
by the Company. Management believes that the Company's trademarks, service marks
and  trade  names  are  an  important  but not critical element of the Company's
merchandising  strategy.

ENVIRONMENTAL  MATTERS

     Under  various federal, state and local environmental laws and regulations,
a  current  or previous owner or occupant of real property may become liable for
the  costs  of  removal  or  remediation  of  hazardous  substances at such real
property.  Such  laws  and  regulations often impose liability without regard to
fault.  As  of  March 12, 2004 the Company leased 164 of its 194 existing stores
and  the  Company  owned its main California warehouse and distribution facility
(where  its  executive  offices  are  located).  The  Company  owns  three other
warehouses  (i)  a  warehouse  and  distribution  center  in Katy, Texas with an
ammonia based refrigeration system in part of the facility, (ii) a deli & frozen
warehouse  and distribution center in the City of Commerce, California and (iii)
the Company also owns a warehouse facility in Eagan, Minnesota that is currently
being  marketed  for  lease  or  sale.  In  connection with such properties, the
Company  could  be held liable for the costs of remedial actions with respect to
hazardous  substances.  In addition, the Company operates one underground diesel
storage  tank  and  several  above-ground  propane  tanks  at  its warehouse and
distribution  facilities.  Although the Company has not been notified of, and is
not  otherwise  aware of, any specific current environmental liability, claim or
non-compliance,  there  can  be  no  assurance  that  the


                                       8
<PAGE>
Company  will  not be required to incur remediation or other costs in the future
in  connection  with its leased properties or its storage tanks or otherwise. In
the  ordinary  course  of its business, the Company from time to time handles or
disposes  of  ordinary  household  products  that  are  classified  as hazardous
materials  under  various  federal,  state  and  local  environmental  laws  and
regulations.  The  Company  has  adopted  policies  regarding  the  handling and
disposal of these products, and has implemented a training program for employees
on hazardous material handling and disposal. There can be no assurance, however,
that  such  policies  or training will be successful in assisting the Company in
avoiding  violations  of  environmental  laws  and  regulations  relating to the
handling  and  disposal  of  such  products  in  the  future.

AVAILABLE  INFORMATION

     The  Company makes available free of charge its annual report on Form 10-K,
quarterly  reports  on  Form  10-Q  and  current  reports  on Form 8-K through a
hyperlink  from the "Investor Relations" portion of its website, www.99only.com,
                                                                 --------------
to  the  Securities and Exchange Commission's website, www.sec.gov. Such reports
                                                       -----------
should  be  available on the same day that they are electronically filed with or
furnished to the Securities and Exchange Commission by the Company.

ITEM 2. PROPERTIES

     As  of March 12, 2004, the Company owned 30 and leased 164 of its 194 store
locations. The Company also has escrow deposits on five additional locations for
future  openings.  The Company currently leases 12 store locations and a parking
lot  associated with one of these stores from the Gold Family. Our annual rental
expense  for  these  facilities totaled approximately $1.9 million, $2.2 million
and $2.1 million in 2001, 2002 and 2003, respectively. We believe that our lease
terms are just as favorable to us as they would be for an unrelated party. Under
our  current  policy, we enter into real estate transactions with our affiliates
only  for  the renewal or modification of existing leases and on occasions where
we  determine  that  such  transactions are in our best interests. Moreover, the
independent  members of our Board of Directors must unanimously approve all real
estate transactions between us and our affiliates. They must also determine that
such transactions are equivalent to a negotiated arm's-length transaction with a
third  party.  We  cannot  guarantee that we will reach agreements with the Gold
family  on  renewal terms for the properties we currently lease from them. Also,
even  if  we  agree  to  such  terms,  we cannot be certain that our independent
directors  will  approve them. If we fail to renew one of these leases, we could
be  forced to relocate or close the leased store. Any relocations or closures we
experience  will  be  costly and could adversely affect our business. One of our
outside directors, Ben Schwartz, is a trustee of a trust that owns a property on
which  a  single  99  Cents Only Stores is located. Management believes that the
Company's  stable  operating  history,  excellent  credit history and ability to
generate substantial customer traffic give the Company significant leverage when
negotiating  lease  terms. Most of the Company's leases provide for fixed rents,
subject  to  periodic adjustments. Certain of the Company's store leases contain
provisions  that  grant  the  Company  a  right  of first refusal to acquire the
subject  site.

     The  following  table  sets  forth,  as  of  December 31, 2003, information
relating  to  the  expiration  dates  of  the  Company's  current stores leases:

            EXPIRING    EXPIRING      EXPIRING        EXPIRING
              2004     2005-2007     2008-2010     2011 AND BEYOND
              ----     ---------     ---------     ---------------

               15(a)       57           42               40


(a)  Includes three stores leased on a month-to-month basis.

     The Company purchased its main warehouse, distribution and executive office
facility,  located in the City of Commerce, California in 2000. The Company also
leases  an  additional  180,000  square  feet  of warehouse storage space almost
adjacent  to  its  main  distribution  facility.

     On  January  28, 2003 the Company purchased a 741,000 square feet warehouse
and  distribution  center  in Houston, to service its planned store expansion in
Texas  in  2003  and  beyond.  See  "Growth  Strategy  -  Expansion  in  Texas."

     On  December  31, 2003, the Company purchased a 66,000 square feet deli and
frozen  warehouse  and  distribution  center  located  in  the City of Commerce,
California.

     Also,  the Company is in escrow to purchase a 180,000 square foot warehouse
facility  that  is  currently  being  leased  by  the  Company.

ITEM  3.  LEGAL  PROCEEDINGS

Melgoza  vs.  99  Cents  Only  Stores  (Los  Angeles Superior Court; Case No. BC
295342)

     On  May  7,  2003,  the plaintiff, a former Store Manager, filed a putative
class  action  on  behalf  of  himself  and  others similarly situated. The suit
alleges  that  the Company improperly classified Store Managers in the Company's
California stores as exempt from overtime requirements as well as meals and rest
period  requirements  under  California  law. Each store typically had one Store
Manager  and  two  or three Assistant Store Managers. Pursuant to the California
Labor  Code,  the  suit seeks to recover unpaid overtime compensation, penalties
for  failure to provide meal and rest periods, waiting time penalties for former
employees,  interest,  attorney fees, and costs. The suit also charges, pursuant
to  California's  Business  and Professions Code section 17200, that the Company
engaged in unfair business practices by failing to make such payments, and seeks
payment  of all such wages (in the form of restitution) for the four-year period
preceding  the  filing of the case through the present. Plaintiff is now seeking
leave  to  file  an amended complaint that would (1) expand the class to include
not  only  all current and former Store Managers who worked for the Company from
May  7,  1999  but also all current and former Assistant Managers who worked for
the  Company  during the same period; and (2) claims for additional penalties on
behalf  of all purported class members under California's new Labor Code Private
Attorney  General  Act  of 2004. The Company is vigorously asserting defenses to
the  various  claims.

     In  view  of  the  inherent  difficulty  of predicting the outcome of legal
matters,  the  Company cannot state with confidence what the eventual outcome of
this  matter  will  be.  However, based on current knowledge, this matter is not
presently  expected to have a material adverse effect on the Company's financial
condition or overall liquidity, although it could have a material adverse effect
on  the Company's results of operations for the accounting period in which it is
resolved.


                                       9
<PAGE>
Others:

     The  Company is named as a defendant in various other legal matters arising
in  the  normal course of business. In management's opinion, none of these other
matters will have a material effect on the Company's financial position, results
of  operations  or  overall  liquidity.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

  None.


                                       10
<PAGE>
                                     PART II



ITEM  5.  MARKET  FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     The  Company's  Common Stock is traded on the New York Stock Exchange under
the  symbol  "NDN."  The  following  table  sets forth, for the calendar periods
indicated,  the  high  and  low  closing prices per share of the Common Stock as
reported  by  the  New  York  Stock  Exchange.

<TABLE>
<CAPTION>
                                                          Price Range
                                                          -----------
                                                       High           Low
                                                     ------         ------
<S>                                                  <C>            <C>

     2002:
     -----
     First Quarter. . . . . . . . . . . . . . . . .  $28.75         $24.86
     Second Quarter . . . . . . . . . . . . . . . .   32.60          24.91
     Third Quarter. . . . . . . . . . . . . . . . .   25.49          20.70
     Fourth Quarter . . . . . . . . . . . . . . . .   29.80          20.31
     2003:
     -----
     First Quarter. . . . . . . . . . . . . . . . .  $28.48         $20.83
     Second Quarter . . . . . . . . . . . . . . . .   35.09          25.66
     Third Quarter. . . . . . . . . . . . . . . . .   36.02          31.74
     Fourth Quarter . . . . . . . . . . . . . . . .   33.79          24.87
     2004:
     -----
     First Quarter through March 12, 2004            $29.65         $25.20
</TABLE>


     As  of  March 12, 2004, the Company had approximately 30,849 holders of the
Common  Stock  and  an  additional  528  shareholders  of  record.

     The  Company  has  not  paid  any cash dividends with respect to the Common
Stock.  The  Company  presently intends to retain future earnings to finance its
development  and  expansion and therefore does not anticipate the payment of any
cash  dividends  in the foreseeable future. Payment of future dividends, if any,
will  depend  upon  future  earnings and capital requirements of the Company and
other  factors,  which  the  Board  of  Directors  considers  appropriate.

     The  Company  has  one  stock  option  plan (the 1996 Stock Option Plan, as
amended).  The  plan  is  a  fixed  plan,  which  provides  for  the granting of
non-qualified  and  incentive  options  to  purchase  up to 17,000,000 shares of
common  stock of which 5,268,045 are available for future option grants. Options
may  be granted to officers, employees, directors and consultants. Grants may be
at  fair  market  value  at  the  date  of grant or at a price determined by the
compensation  committee  consisting  of  four  outside  members  of the board of
directors  (the  "Committee").  Options vest over a three-year period, one-third
one  year  from  the  date  of  grant and one third per year thereafter. Options
expire  ten  years  from  the  date of grant. The Company accounts for its stock
option  plan  under APB Opinion No. 25 under which no compensation cost has been
recognized  in  fiscal  2001,  2002  and  2003.

ITEM  6.  SELECTED  FINANCIAL  DATA

     The  following  table  sets forth, selected financial and operating data of
the Company for the periods indicated. The Consolidated Financial Statements for
years 1999 through 2001 were audited by Arthur Andersen LLP (Andersen) which has
ceased  operations.  A  copy  of the report previously issued by Andersen on our
financial  statements as of December 31, 2000 and 2001 and for each of the three
years  in  the period ended December 31, 2001 is included elsewhere in this Form
10-K.  Such  report has not been reissued by Andersen. The following information
should be read in conjunction with "Item 7. Management's Discussion and Analysis
of  Financial  Condition  and  Results  of  Operations"  and  "Item 8. Financial
Statements  and  Supplementary  Data"  of the Company and notes thereto included
elsewhere  in  this  Form  10-K.

<TABLE>
<CAPTION>
                                                               YEAR ENDED DECEMBER 31
                                          -----------------------------------------------------------------
                                             (Amounts in thousands, except per share and operating data)
<S>                                         <C>          <C>          <C>          <C>          <C>
Statements of Income Data:                        1999         2000         2001         2002         2003
                                          -------------  -----------  -----------  -----------  -----------
Net sales:
  99 Cents Only Stores. . . . . . . . .     $  312,306   $  402,071   $  522,019   $  663,983   $  816,348
  Bargain Wholesale (e) . . . . . . . .         47,652       49,876       56,250       49,959       46,112
                                          -------------  -----------  -----------  -----------  -----------
     Total sales. . . . . . . . . . . .        359,958      451,947      578,269      713,942      862,460
Cost of sales . . . . . . . . . . . . .        218,496      275,395      350,421      427,356      516,686
                                          -------------  -----------  -----------  -----------  -----------
Gross profit. . . . . . . . . . . . . .        141,462      176,552      227,848      286,586      345,774
Selling, general and administrative
expenses:
  Operating expenses. . . . . . . . . .         80,089      107,981      141,544      178,374      234,626
  Depreciation and amortization.. . . .          5,927        8,666       12,354       17,711       23,763
                                          -------------  -----------  -----------  -----------  -----------
     Total operating expenses . . . . .         86,016      116,647      153,898      196,085      258,389
Operating income. . . . . . . . . . . .         55,446       59,905       73,950       90,501       87,384
Other (income) net. . . . . . . . . . .         (1,059)      (3,617)      (5,931)      (4,847)      (4,457)
                                          -------------  -----------  -----------  -----------  -----------
</TABLE>


                                       11
<PAGE>
<TABLE>
<CAPTION>
                                       (CONTINUED FROM PREVIOUS PAGE)

                                                                 AS OF DECEMBER 31
                                                                 -----------------
                                              (Amounts in thousands, except per share and operating data)

                                               1999         2000         2001         2002         2003
                                            -----------  -----------  -----------  -----------  -----------
<S>                                         <C>          <C>          <C>          <C>          <C>
Income from continuing operations
before provision
for income taxes . . . . . . . . . . . . .      56,505       63,522       79,881       95,348       91,842
Provision for income taxes . . . . . . . .      22,367       24,664       31,438       36,374       35,313
                                            -----------  -----------  -----------  -----------  -----------
Income from continuing operations. . . . .  $   34,138   $   38,858   $   48,443   $   58,974   $   56,529
                                            -----------  -----------  -----------  -----------  -----------
Income (loss) from discontinued
  operations net of income tax benefit of
  2,111 and $700 in 1999 and
  2000 respectively. . . . . . . . . . . .      (3,167)      (1,050)           -            -            -

(Loss) on disposal of discontinued
  operations including a provision of
  1,200 for operating losses during
  phase-out period, net of income tax
  benefit of $2,613. . . . . . . . . . . .      (9,000)           -            -            -            -
                                            -----------  -----------  -----------  -----------  -----------

Net income . . . . . . . . . . . . . . . .  $   21,971   $   37,808   $   48,443   $   58,974   $   56,529
                                            ===========  ===========  ===========  ===========  ===========
Earnings per common share from
continuing
operations:
  Basic. . . . . . . . . . . . . . . . . .  $     0.51   $     0.58   $     0.70   $     0.84   $     0.79
  Diluted. . . . . . . . . . . . . . . . .  $     0.50   $     0.56   $     0.69   $     0.83   $     0.78
(Loss) per common share from
discontinued operations:
  Basic. . . . . . . . . . . . . . . . . .      ($0.05)      ($0.02)           -            -            -
  Diluted. . . . . . . . . . . . . . . . .      ($0.05)      ($0.02)           -            -            -
(Loss) per common share from disposal
of discontinued operations:
  Basic. . . . . . . . . . . . . . . . . .      ($0.13)           -            -            -            -
  Diluted. . . . . . . . . . . . . . . . .      ($0.13)           -            -            -            -
Earnings per common share:
  Basic. . . . . . . . . . . . . . . . . .  $     0.33   $     0.56   $     0.70   $     0.84   $     0.79
  Diluted. . . . . . . . . . . . . . . . .  $     0.32   $     0.55   $     0.69   $     0.83   $     0.78
Weighted average number of common
shares outstanding:
  Basic. . . . . . . . . . . . . . . . . .      66,487       67,650       68,815       69,938       71,348
  Diluted. . . . . . . . . . . . . . . . .      67,954       68,945       70,009       71,181       72,412

COMPANY OPERATING DATA:
-----------------------
Sales Growth
  99 Cents Only Stores . . . . . . . . . .        30.7%        28.7%        29.8%        27.2%        23.0%
  Bargain Wholesale. . . . . . . . . . . .      (10.4)%         4.7%        12.8%      (11.2)%       (7.7)%
  Total Company sales. . . . . . . . . . .        23.2%        25.6%        28.0%        23.5%        20.8%
Gross margin . . . . . . . . . . . . . . .        39.3%        39.1%        39.4%        40.1%        40.1%
Operating margin . . . . . . . . . . . . .        15.4%        13.3%        12.8%        12.7%        10.1%
Income from continuing operations: . . . .         9.5%         8.6%         8.4%         8.3%         6.6%

RETAIL OPERATING DATA (A):
--------------------------
99 Cents Only Stores at end of period. . .          78           98          123          151          189
Change in comparable stores
Net sales (b). . . . . . . . . . . . . . .         6.1%         2.0%         5.9%         3.6%         4.8%
Average net sales per store open the
full year. . . . . . . . . . . . . . . . .  $    4,433   $    4,487   $    4,647   $    4,750   $    4,929
Average net sales per estimated saleable
square foot (c). . . . . . . . . . . . . .  $      332   $      318   $      319   $      309   $      308
Estimated saleable square footage at
year end . . . . . . . . . . . . . . . . .   1,102,369    1,424,280    1,892,949    2,428,681    3,190,528

Balance Sheet Data:
  Working capital. . . . . . . . . . . . .  $  105,637   $  166,779   $  194,302   $  215,747   $  217,902
  Total assets . . . . . . . . . . . . . .     224,015      277,285      352,158      442,576      553,238
  Capital lease obligation, including
  current portion. . . . . . . . . . . . .       7,251            -        1,677        1,637        1,593
  Total shareholders' equity . . . . . . .  $  195,540   $  253,533   $  319,643   $  396,615   $  489,886
<FN>
(a)  Includes retail operating data solely for the Company's 99 Cents Only
     Stores.
(b)  Change in comparable stores net sales compares net sales for all stores
     open at least 15 months.
(c)  Computed based upon estimated total saleable square footage of stores open
     for the entire period.
</TABLE>


                                       13
<PAGE>
ITEM  7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF  OPERATIONS.

     The  following  management's  discussion  and  analysis  should  be read in
connection  with  "Item  6.  Selected  Financial  Data,"  and "Item 8. Financial
Statements  and  Supplementary  Data."

GENERAL

     99  Cents  Only Stores increased its net sales, operating income and income
from  continuing  operations  in  each year from 1999 to 2002. In 2003, 99 Cents
Only  Stores  had net sales of $862.5 million, operating income of $87.4 million
and  net  income  of  $56.5  million. Sales increased 20.8% over 2002. Operating
income  and net income decreased 3.4% and 4.1% respectively from 2002. From 1999
through  2003,  the  Company  had  a  compound  annual growth rate in net sales,
operating  income  and  net  income  of  21.7%,  14.4%  and 16.2%, respectively.

     During  the  three years ending December 31, 2003, average annual net sales
per  estimated  saleable square foot (computed for 99 Cents Only Stores open for
the  full year) declined from $318 per square foot to $308 per square foot. This
trend  reflects  the  Company's determination to target larger locations for new
store  development.  Existing  stores  average approximately 21,500 gross square
feet.  From January 1, 2001 through December 31, 2003, the Company opened 92 new
stores  (including  one  relocation  in  2001) that average approximately 24,700
gross  square  feet.  The  Company currently targets new store locations between
18,000  and  28,000  gross  square feet. Although it is the Company's experience
that  larger  stores generally have lower average net sales per square foot than
smaller  stores,  larger  stores  generally  achieve higher average annual store
revenues  and operating income. During the three years ending December 31, 2003,
average  annual  net sales per store (computed for 99 Cents Only Stores open for
the  full  year)  increased  from  $4.5  million  to  $4.9  million.

     The  Company's management believes that future growth will primarily result
from  new  store  openings facilitated by growth in our existing territories and
expansion  into  new  territories.  The Company has now expanded into Texas, and
expects to continue to open new stores in Texas as well as in California, Nevada
and  Arizona.  The  Company believes that its concept of consistently offering a
broad  selection  of  name-brand  consumables, at value pricing, in a convenient
store  format  is portable to most other densely populated areas of the country.
The  Company  considers  lease  acquisitions  or  purchase opportunities as they
become  known to the Company and may make acquisitions of a chain, or chains, of
clustered  retail  sites in densely populated regions, primarily for the purpose
of  acquiring  favorable  store locations. See "Growth Strategy" and Risk Factor
"We  Depend  on  New  Store  Openings  for  Future  Growth."

CRITICAL  ACCOUNTING  POLICIES  AND  ESTIMATES

     The  preparation  of  financial  statements  requires  management  to  make
estimates  and  assumptions  that  affect reported earnings. These estimates and
assumptions  are  evaluated  on  an  on-going  basis and are based on historical
experience  and  on  other  factors  that  management  believes  are reasonable.
Estimates and assumptions include, but are not limited to, the areas of customer
receivables,  inventories,  self-insurance  reserves,  and  commitments  and
contingencies.

     The  Company  believes  that  the  following represent the areas where more
critical  estimates and assumptions are used in the preparation of the financial
statements:

     Investments:  The  Company  records  its  investments,  which are comprised
primarily  of investment grade federal and municipal bonds and commercial paper,
at  fair  value.  Any  premium  or  discount  recognized  in connection with the
purchase  of  an  investment  is  amortized over the term of the investment. The
Company accounts for its investments in marketable securities in accordance with
Financial  Accounting  Standards  Board  No.  115  as  trading  securities.

     Long-lived  asset  impairment:  The  Company  records  impairments when the
carrying  amounts  of  long-lived  assets  are determined not to be recoverable.
Impairment is assessed and measured by an estimate of future cash flows expected
to  result  from  the  use of the asset and its eventual disposition. Changes in
market  conditions  can  impact  estimated  future  cash flows from use of these
assets  and  additional  impairments  may be required should such changes occur.

     Self-insurance  reserves:  The  Company  is  self-insured  in  relation  to
worker's  compensation claims in California.  The Company provides for losses of
estimated  known and incurred but not reported insurance claims. These estimates
are based on reported claims and actuarial valuations.   Should a greater amount
of  claims  occur  compared  to  the  estimates,  reserves  recorded  may not be
sufficient and additional expenses, which may be significant, could be incurred.
The  Company  does not discount for the time value of money its projected future
cash  outlays  for  its  existing  workers  compensation  claims.


Universal  International  (Discontinued  Operations)

     In  December 1999, the Company determined it would be in its best interest,
and that of its shareholders, to focus its efforts on increasing the growth rate
of  99  Cents  Only Stores. In conjunction with its revised growth strategy, the
Company  decided  to  sell  its Universal International, Inc. and Odd's-n-End's,
Inc. subsidiaries (together "Universal"). Universal operated a multi-price point
variety  chain, with 65 stores located in the Midwest, Texas and New York, under
the  trade names Only Deals and Odd's-N-End's. Among other factors at that time,
the  Company considered its successful opening of its first 99 Cents Only Stores
outside  of  Southern California, in Las Vegas, Nevada. Given the success of the
Las  Vegas,  Nevada  stores,  the Company believed that the 99 Cents Only Stores
concept  was  portable to areas outside of Southern California. As a result, the
Company  has focused greater management resources to increasing its store growth
rate  and  expanding  aggressively  into  Nevada,  Arizona  and  in 2003, Texas.


                                       14
<PAGE>
     The Company adopted a definitive plan to sell Universal within one year, as
set forth by guidelines for the accounting treatment of discontinued operations.
The  Company  engaged  an  investment-banking  firm  to  evaluate  and  identify
potential  buyers  for  the  Universal  business  and expected to sell Universal
within  the  one-year time frame from when the Company classified Universal as a
discontinued  operation. The investment banking firm's marketing process focused
upon  selling  the  business  as  a going concern. From June 2000 through August
2000,  sales presentations were delivered to both strategic buyers and financial
buyers. This process did not generate the expected interest level from potential
buyers  that  had been anticipated. The highest offer for the Universal business
was  significantly  less  than  the  Company's  expectations. As a result of the
difficulties  encountered  in  trying  to  sell  Universal  and the necessity to
complete  the  process  by  December  31,  2000,  it was decided by the Board of
Directors  to  be  in  the Company's and the shareholders' best interest to sell
Universal  for  the  Company's  carrying  value  as  of the close of business on
September  30,  2000 to Universal Deals, Inc. and Universal Odd's-n-End's, Inc.,
both  of  which  are  owned  100%  by  David  and  Sherry Gold, both significant
shareholders  of  99  Cents Only Stores. Mr. Gold is also Chairman and CEO of 99
Cents  Only  Stores.  The  sale  was  effective  as  of the close of business on
September  30,  2000.  The purchase price for Universal was paid in cash and was
equal  to  the  Company's  carrying  book  value  of  the assets of Universal at
September  30,  2000  or  $33.9  million.  The  net assets at September 30, 2000
included  $29.2  million in inventory, net fixed assets of $7.6 million and $0.6
million  of  other  assets. These assets were offset by $3.5 million of accounts
payable,  accrued and other liabilities. In connection with this transaction, 99
Cents  Only Stores provided certain ongoing administrative services to Universal
in  2000  and 2001 pursuant to a service agreement for a management fee of 6% of
Universal  sales  revenues.  During  fiscal  year  2000, the Company recorded an
additional  net  loss  from  discontinued operations of $1.1 million, net of tax
benefit of $0.7 million, for operating losses incurred through the date of sale,
in  excess  of the amounts originally provided in 1999. In the fourth quarter of
2000,  the  Company  received  $1.3 million in management fees under the service
agreement  with  Universal.  The  Company  also  received  $0.4 million in lease
payments  for  rental  of a distribution facility to Universal. During 2001, the
Company  received $3.7 million in fees under the service agreement, $1.4 million
in lease payments and sold $4.7 million in merchandise at a 10% mark-up. In 2002
the Company received $1.5 million in management fees under the service agreement
from  Universal  and  $1.4  million  in  lease  payments. It also purchased $0.4
million  of  closeout inventory from Universal. During 2003 the Company received
$1.4  million  in management fees under the service agreement from Universal and
$1.4  million in lease payments. The service and lease agreements with Universal
culminated  as of December 15, 2003 and there are no remaining amounts due to or
from  Universal  under these  agreements.

     The  following table sets forth for the periods indicated, certain selected
income  statement  data,  including  such  data  as  a  percentage of net sales:

<TABLE>
<CAPTION>
                                                                 YEARS ENDED DECEMBER 31
                                             ---------------------------------------------------------------
                                                                 (Amounts in thousands)

                                                   2001                  2002                  2003
                                             ----------  -------  -----------  -------  -----------  -------
<S>                                            <C>        <C>        <C>        <C>        <C>        <C>
Net Sales:
99 Cents Only Stores. . . . . . . . . . . .    $522,019    90.3%     $663,983    93.0%     $816,348    94.7%
Bargain Wholesale . . . . . . . . . . . . .      56,250     9.7        49,959     7.0        46,112     5.3
                                             ----------  -------  -----------  -------  -----------  -------
Total . . . . . . . . . . . . . . . . . . .     578,269   100.0       713,942   100.0       862,460   100.0
Cost of sales . . . . . . . . . . . . . . .     350,421    60.6       427,356    59.9       516,686    59.9
                                             ----------  -------  -----------  -------  -----------  -------
Gross profit. . . . . . . . . . . . . . . .     227,848    39.4       286,586    40.1       345,774    40.1
Selling, general and administrative expenses:
Operating expenses. . . . . . . . . . . . .     141,544    24.5       178,374    24.9       234,626    27.2
Depreciation and amortization . . . . . . .      12,354     2.1        17,711     2.5        23,763     2.8
                                             ----------  -------  -----------  -------  -----------  -------
Total . . . . . . . . . . . . . . . . . . .     153,898    26.6       196,085    27.4       258,389    30.0
Operating income. . . . . . . . . . . . . .      73,950    12.8        90,501    12.7        87,384    10.1
Other (income) expense, net . . . . . . . .      (5,931)   (1.0)       (4,847)   (0.7)       (4,457)   (0.5)
                                             ----------  -------  -----------  -------  -----------  -------
Income before provision for income taxes. .      79,881    13.8        95,348    13.4        91,842    10.6
Provision for income taxes. . . . . . . . .      31,438     5.4        36,374     5.1        35,313     4.1
                                             ----------  -------  -----------  -------  -----------  -------
Net income. . . . . . . . . . . . . . . . .    $ 48,443     8.4%     $ 58,974     8.3%     $ 56,529     6.5%
                                             ==========  =======  ===========  =======  ===========  =======
</TABLE>

YEAR  ENDED  DECEMBER  31,  2003  COMPARED  TO  YEAR  ENDED  DECEMBER  31,  2002

     Net  Sales. Total net sales increased $148.5 million, or 20.8%, from $713.9
million  in  2002  to  $862.5  million  in  2003. 99 Cents Only Stores net sales
increased  $152.3  million,  or  22.9%,  from  $664.0  million in 2002 to $816.3
million  in  2003.  Bargain Wholesale net sales decreased $3.8 million, or 7.7%,
from  $50.0  million  in 2002 to $46.1 million in 2003. The net effect of 38 new
stores  opened in 2003 increased 99 Cents Only Stores net sales by $67.3 million
and  the  full  year  effect  of 28 net stores opened in 2002 increased sales by
$56.0  million. Comparable stores net sales increased 4.8% in 2003. The decrease
in  Bargain  Wholesale  net  sales  was  primarily attributed to the competitive
pricing  environment  in  the  wholesale  business, a decline in sales to export
brokers  and  a  greater  focus  on the growth of the Company's retail business.

     Gross profit. Gross profit, which consists of total net sales, less cost of
sales,  increased $59.2 million, or 20.7%, from $286.6 million in 2002 to $345.8
million  in  2003.  The  increase  in  gross profit dollars was primarily due to
higher  sales  volume.  As  a percentage of net sales, gross profit was 40.1% in
2003  and  2002.  The  retail  gross  margin decreased to 41.2% of sales in 2003
versus  41.7% in 2002. This percentage variance was due to a 35.2% growth in the
grocery  product sales, which have a lower margin than other product categories.
Margins  on  closeouts  vary  widely  depending  on circumstances giving rise to
product  availability.  See Risk Factor "We depend on our relationships with our
suppliers  and the availability of close-out and special-situation merchandise."
The wholesale margin was 19.8% in 2003 versus 20.1% in 2002. Wholesale margin is
generally  driven  by  local competitive pricing factors, which results in lower
sales  prices.

     Operating  Expenses. Operating expenses, increased $56.3 million, or 31.5%,
from  $178.4  million  in  2002  to  $234.6  million  in  2003. The 38 new store
additions  in  2003  increased operating expenses by $33.2 million. Distribution
costs  increased  $11.6  million.  This  includes  transportation  costs,  which
increased $3.5 million due to the addition of new stores in Northern California,
Nevada,  Arizona  and  Texas.  The  addition


                                       15
<PAGE>
of  the new Texas distribution center increased distribution costs $2.0 million,
warehouse  cost  increased  $6.1  million due to overall increase in labor cost.
Increases  in  administrative  costs  include  an increase in California workers
compensation  expense  of  $11.6  million  based  on  store  and labor growth in
California.  Other  administrative  cost increases of $4.4 million, include $1.1
million  of  start  up  costs  in  Texas.  Additional  key  administrative staff
positions  were  filled in information systems, real estate, distribution, human
resources,  finance,  strategic planning and buying. Operating costs were offset
by  $1.4  million in management fees from Universal (see Universal International
above).

     Depreciation  and Amortization. Depreciation increased $6.1 million. The 38
new  store  additions  increased  depreciation by $4.1 million and the new Texas
distribution  center increased depreciation $0.5 million. Other increases result
from amortization of information systems costs and depreciation costs of the Los
Angeles  distribution  center.

     Operating  income.  Operating  income decreased $3.1 million, or 3.4%, from
$90.5 million in 2002 to $87.4 million in 2003. Operating income as a percentage
of  net  sales was 10.1% in 2003 and 12.7% in 2002 primarily due to the increase
in  the  operating  costs  discussed  above.

     Other  (income)  expense.  Other  (income) expense relates primarily to the
interest  income on the Company's marketable securities, net of interest expense
on  the  Company's capitalized leases. Interest expense was $0.1 million in 2002
and  in  2003. The Company had no bank debt during 2002 or 2003. Interest income
earned  on the Company's marketable securities was $3.1 million in 2003 and $3.5
million  in  2002.  At  December  31,  2003,  the Company held $145.7 million in
short-term investments and $52.8 million in long-term investments. The Company's
short-term  investments  are comprised primarily of investment grade federal and
municipal  bonds  and  commercial  paper,  all  with  short-term maturities. The
Company  generally  holds investments until maturity. Also included in both 2003
and  2002 is $1.4 million of income under a lease agreement with Universal for a
distribution  facility.  This  agreement  ended  on  December  15,  2003.

     Provision  for  income  taxes.  The  provision for income taxes in 2003 was
$35.3  million,  or 4.1% of net sales, compared to $36.4 million, or 5.1% of net
sales  in  2002. The effective combined federal and state rates of the provision
for  income  taxes  were  38.4%  and  38.2%  in 2003 and 2002, respectively. The
effective combined federal and state tax rates are less than the statutory rates
in  each  period and were calculated to reflect estimated tax rates after giving
effect  for  tax  credits  and  the  estimated  versus  the  actual  tax  rate
differential.  See  Note  7  of  "Notes  to  Financial  Statements."

     Net  Income. As a result of the items discussed above, net income decreased
$2.4  million, or 4.1%, from $59.0 million in 2002 to $56.5 million in 2003. Net
income  as  a  percentage  of  net  sales  was  6.5%  in  2003 and 8.3% in 2002.

YEAR ENDED DECEMBER 31, 2002 COMPARED TO YEAR ENDED DECEMBER 31, 2001

     Net  Sales. Total net sales increased $135.7 million, or 23.5%, from $578.3
million  in  2001  to  $713.9  million  in  2002. 99 Cents Only Stores net sales
increased  $142.0  million,  or  27.2%,  from  $522.0  million in 2001 to $664.0
million  in  2002. Bargain Wholesale net sales decreased $6.3 million, or 11.2%,
from  $56.3  million  in 2001 to $50.0 million in 2002. 99 Cents Only Stores net
sales  increased  $79.7  million from the 28 new stores opened in 2002. The full
year effect of 25 net stores opened in 2001 was $49.2 million. Comparable stores
net  sales  increased  3.6% from 2001 to 2002. The decrease in Bargain Wholesale
net  sales  was primarily attributed to the absence of sales to Universal, which
were  $4.7  million  in  2001.

     Gross profit. Gross profit, which consists of total net sales, less cost of
sales,  increased $58.7 million, or 25.8%, from $227.8 million in 2001 to $286.6
million  in  2002.  The  increase  in  gross profit dollars was primarily due to
higher  sales  volume.  As  a percentage of net sales, gross profit was 40.1% in
2002  versus  39.4%  in 2001. This 0.7% variation results from the change in the
ratio  of  retail  versus  wholesale sales. The retail gross margin increased 10
basis  points to 41.7% of sales in 2002 versus 41.6% in 2001, this was due sales
growth  in  houseplant  and  counter items. Gross margins will vary from time to
time  because  of the closeout nature of the business. Margins on closeouts vary
widely  depending on circumstances giving rise to product availability. See Risk
Factor  "We  depend on our relationships with our suppliers and the availability
of  close-out and special-situation merchandise". The wholesale margin was 20.1%
in  2002 versus 19.3% in 2001. The wholesale margin increased as a result of the
loss of $4.7 million in sales to Universal in 2001, which carried a lower margin
of  10%.

     Operating  Expenses. Operating expenses, increased $36.8 million, or 26.0%,
from  $141.5 million in 2001 to $178.4 million in 2002. The 28 new stores opened
in  2002  increased operating expenses $25.3 million. Approximately $4.3 million
in  cost  increases  were attributable to utility cost increases associated with
the  retrofitting  of  older  stores  with  expanded frozen and deli selling and
storage  space.  Minimum  wage  cost  increases  were  $5.1  million.  Growth in
corporate  staff  positions  and field rep staff positions were $1.2 million and
there  were other cost increases of $1.0 million. Operating costs were offset by
$1.5  million  in  management  fees  from Universal (see Universal International
above).

     Depreciation.  Depreciation  increased  $5.4 million in 2002 over 2001. New
store  additions  accounted  for $4.2 of this increase, $1.0 was attributable to
increases in depreciation of computer hardware and software and $0.2 million was
an  increase  in  depreciation  of  distribution  equipment.

     Operating  income. Operating income increased $16.6 million, or 22.4%, from
$74.0 million in 2001 to $90.5 million in 2002. Operating income as a percentage
of  net  sales was 12.8% in 2001 and 12.7% in 2002 primarily due to the increase
in  the  operating  costs  discussed  above.

     Other  (income)  expense.  Other  (income) expense relates primarily to the
interest  income on the Company's marketable securities, net of interest expense
on  the  Company's capitalized leases. Interest expense was $0.1 million in 2001
and  in  2002. The Company had no bank debt during 2002 or 2001. Interest income
earned  on the Company's marketable securities was $3.5 million in 2002 and $4.6
million  in  2001.  At  December  31,  2002,  the Company held $146.9 million in
short-term investments and $37.2 million in long-term investments. The Company's
short-term  investments  are comprised primarily of investment grade federal and
municipal  bonds  and  commercial  paper,  all  with  short-term maturities. The
Company  generally  holds investments until maturity. Also included in both 2002
and  2001 is $1.4 million of income under a lease agreement with Universal for a
distribution  facility.


                                       16
<PAGE>
     Provision  for  income  taxes.  The  provision for income taxes in 2002 was
$36.4  million,  or 5.1% of net sales, compared to $31.4 million, or 5.4% of net
sales  in  2001. The effective combined federal and state rates of the provision
for  income  taxes  were  39.3%  and  38.1%  in 2001 and 2002, respectively. The
effective combined federal and state tax rates are less than the statutory rates
in  each  period and were calculated to reflect estimated tax rates after giving
effect  for  tax  credits  and  the  estimated  versus  the  actual  tax  rate
differential.  See  Note  7  of  "Notes  to  Financial  Statements."

     Net  Income. As a result of the items discussed above, net income increased
$10.5  million,  or  21.7%, from $48.4 million in 2001 to $59.0 million in 2002.
Net  income  as  a  percentage  of  net sales was 8.3% in 2002 and 8.4% in 2001.

LIQUIDITY  AND  CAPITAL  RESOURCES

     Since  inception,  the  Company  has funded its operations principally from
cash  provided by operations, and has not generally relied upon external sources
of financing. The Company's capital requirements result primarily from purchases
of  inventory,  expenditures  related  to new store openings and working capital
requirements  for  new  and  existing  stores.  The  Company  takes advantage of
close-out  and other special-situation opportunities, which frequently result in
large  volume  purchases,  and  as  a consequence, its cash requirements are not
constant  or  predictable  during the year and can be affected by the timing and
size  of  its  purchases.

     Net  cash  provided  by operations during 2002 and 2003 was $72.3 and $79.5
million,  respectively,  consisting primarily of $75.7 million and $87.3 million
of  net  income  adjusted for non-cash items. The Company provided $12.2 million
and  $10.5  million  respectively,  in working capital and other activities. Net
cash  used  in  working  capital  and  other  activities  primarily reflects the
increases  in  inventories  in  the amount of $16.6 million and $24.2 million in
2002  and  2003,  respectively.

     Net  cash  used  in investing activities during 2002 and 2003 was $77.5 and
$112.2  million.  In  2002,  the  Company used $41.6 million for the purchase of
property  and  equipment  including  $19.6  million used for the purchase of new
store locations, $0.1 million in investments in two partnerships for the purpose
of obtaining leases on two store locations and $36.0 million for the purchase of
short-term  investments.  The Company did not repurchase any of its shares under
its  stock  repurchase  program in 2001, which expired during 2002. In 2003, the
Company  used $97.3 million for the purchase of property and equipment including
$23.0  million  for  the  purchase  of  a modern distribution center in Houston,
Texas,  $8.3  million  for  a  frozen and refrigerated warehouse in Los Angeles,
$39.7  million  for  new  and existing stores, $12.1 million for construction in
progress  on  future  store openings $1.5 million for distribution and warehouse
equipment  and  $0.6  million for information systems and other corporate needs.
The  company also invested $14.4 million for the purchase of short and long-term
investments.

     Net  cash  provided  by financing activities during 2002 and 2003 was $12.9
and  $25.7  million,  which  represents  the  proceeds  from  the  exercise  of
non-qualified stock options. The Company does not maintain any credit facilities
with  any  bank.

     The  Company plans to open 48 new 99 Cents Only Stores in 2004. The average
investment  per  new  store  opened  in  2003, including leasehold improvements,
furniture,  fixtures  and  equipment,  inventory  and  pre-opening expenses, was
approximately  $1,100,000 and includes 6 stores that were purchased. The Company
does not capitalize pre-opening expenses. The Company's cash needs for new store
openings including acquired properties are expected to total approximately $54.0
million  in  2004.  The Company's total planned capital expenditures in 2004 for
additions  to  fixtures and leasehold improvements of existing stores as well as
for  distribution  and  transportation equipment, information systems, expansion
and  replacement  will be approximately $26.0 million. The Company believes that
its  total  capital expenditure requirements (including new store openings) will
approximate  $80.0  million  in  2004. The Company intends to fund its liquidity
requirements  in  2004  out  of  net  cash  provided  by  operations, short-term
investments  and  cash  on  hand.

CONTRACTUAL OBLIGATIONS

     The following table summarizes our consolidated contractual obligations (in
thousands)  as  of  December  31, 2003. These should be read in conjunction with
"Note  8.  Commitments  and  Contingencies"

<TABLE>
<CAPTION>
                                                        LESS THAN     1-3      3-5    MORE THAN
CONTRACTUAL OBLIGATIONS                        TOTAL      1 YEAR     YEARS    YEARS    5 YEARS
<S>                                           <C>       <C>         <C>      <C>      <C>

Capital Lease Obligations                     $  2,551  $       40  $   490  $   398  $    1,623

Operating Lease Obligations                    153,778      26,834   46,174   34,408      46,362

Other Long-Term Liabilities reflected on the
Company's Balance Sheet under GAAP               2,114           -        -        -       2,114

Total                                         $158,443  $   26,874  $46,664  $34,806  $   50,099
</TABLE>


LEASE  COMMITMENTS

     The  Company  leases  various  facilities under operating leases except for
two,  which  were  classified as capital leases and will expire at various dates
through  2018.  Some  of  the  lease  agreements  contain renewal options and/or
provide  for scheduled increases or increases based on the Consumer Price Index.
Total  minimum  lease  payments  under each of these lease agreements, including
scheduled increases, are charged to operations on a straight-line basis over the
life  of  each  respective lease. Certain leases require the payment of property
taxes,  maintenance and insurance. Rental expense charged to operations in 2000,
2001  and 2002 was approximately $15.6 million, $19.4 million and $24.9 million,
respectively.  The  Company  typically seeks leases with an initial five-year to
ten-year  term  and  with  one  or  more five-year renewal options. See "Item 2.
Properties."  Most  leases have renewal options ranging from three to ten years.


                                       17
<PAGE>
SEASONALITY  AND  QUARTERLY  FLUCTUATIONS

     The  Company  has  historically  experienced  and  expects  to  continue to
experience some seasonal fluctuations in its net sales, operating income and net
income.  The  highest  sales  periods  for  the  Company  are  the Christmas and
Halloween seasons. A greater amount of the Company's net sales and operating and
net  income  is  generally  realized  during  the  fourth quarter. The Company's
quarterly  results of operations may also fluctuate significantly as a result of
a  variety  of  other  factors,  including the timing of certain holidays (e.g.,
Easter)  and  the  timing  of  new  store  openings  and  the  merchandise  mix.

SUPPLEMENTARY  FINANCIAL  INFORMATION

     The  following table sets forth certain unaudited results of operations for
each  quarter  during 2002 and 2003. The unaudited information has been prepared
on  the  same  basis  as the audited financial statements appearing elsewhere in
this  report  and includes all adjustments, which management considers necessary
for  a fair statement of the financial data shown. The operating results for any
quarter  are  not  necessarily  indicative of the results to be attained for any
future  period.

<TABLE>
<CAPTION>
                                 YEAR ENDED DECEMBER 31, 2002                     YEAR ENDED DECEMBER 31, 2003
                                 ----------------------------                     ----------------------------
                                                 (Amounts in thousands except per share data)

                             1ST          2ND        3RD        4TH         1ST         2ND        3RD         4TH
                           QUARTER      QUARTER    QUARTER    QUARTER     QUARTER     QUARTER    QUARTER     QUARTER
                           -------      -------    -------    -------     -------     -------    -------     -------
<S>                        <C>          <C>        <C>        <C>         <C>         <C>        <C>         <C>
Net sales:
   99 Cents Only
   Stores. . . . . . . .   $149,647     $155,436   $160,424   $198,476    $184,713    $195,052   $200,567   $236,016
   Bargain Wholesale . .     13,457       12,426     11,839     12,237      11,710      11,981     10,969     11,452
     Total . . . . . . .    163,104      167,862    172,263    210,713     196,423     207,033    211,536    247,468
Gross profit . . . . . .     64,242       67,564     68,755     86,025      79,398      82,803     82,877    100,695
Operating income . . . .     19,320       21,024     20,607     29,550      22,915      23,069     18,123     23,278
Net income . . . . . . .   $ 12,470     $ 13,519   $ 13,255   $ 19,730    $ 14,609    $ 14,836   $ 12,102   $ 14,982

Earnings per
common share:
   Basic . . . . . . . .   $   0.18     $   0.19   $   0.19   $   0.28    $   0.21    $   0.21   $   0.17   $   0.21
   Diluted . . . . . . .   $   0.18     $   0.19   $   0.19   $   0.28    $   0.20    $   0.21   $   0.17   $   0.21
Shares outstanding:
   Basic . . . . . . . .     69,558       69,888     70,043     70,278      70,469      71,038     71,929     72,044
   Diluted . . . . . . .     70,925       71,275     71,217     71,362      71,536      72,346     73,033     72,779

Percent of net sales:
Net sales:
   99 Cents Only
   Stores. . . . . . . .       91.7%         92.6%      93.1%      94.2%         94.0%        94.2%      94.8%      95.4%
   Bargain Wholesale . .        8.3           7.4        6.9        5.8           6.0          5.8        5.2        4.6
      Total. . . . . . .      100.0         100.0      100.0      100.0         100.0        100.0      100.0      100.0
Gross profit . . . . . .       39.4          40.2       39.9       40.8          40.4         40.0       39.2       40.7
Operating income . . . .       11.8          12.5       12.0       14.0          11.7         11.1        8.6        9.4
Net income . . . . . . .        7.6%          8.1%       7.7%       9.4%          7.4%         7.2%       5.7%       6.1%
</TABLE>

NEW AUTHORITATIVE PRONOUNCEMENTS

     In  November  2002,  the  Financial  Accounting Standards Board issued FASB
Interpretation  No.  45, "Guarantor's Accounting and Disclosure Requirements for
Guarantees, Including Indirect Guarantees of Indebtedness of Others" ("FIN 45").
FIN  45  requires  a  guarantor  to  recognize a liability at the inception of a
guarantee equal to the fair value of the obligation undertaken and elaborates on
the disclosures to be made by the guarantor.  The disclosure requirements of FIN
45  are  required  for the fiscal year ended December 31, 2002.  The recognition
and  measurement provisions of FIN 45 are effective, on a prospective basis, for
guarantees  issued by the Company beginning in fiscal 2003.  The adoption of FIN
45 is not expected to have a material impact on the Company's financial position
or  results  of  operations.

     In  January  2003,  the  FASB issued FIN No. 46, "Consolidation of Variable
Interest  Entities."  FIN 46 establishes a new and far-researching consolidation
accounting  model.  Although  FIN No 46 was initially focused on special purpose
entities,  the applicability of FIN No 46 goes beyond such entities and can have
applicability  to  franchise arrangements, regardless of whether the Company has
voting  or  ownership  control  of  such  franchisee. In response to a number of
comment  letters  and implementation questions, in December 2003 the FASB issued
FIN  No.  46R, which delays the effective date of FIN No 46 for certain entities
until  March  31,  2004,  as  well  as  provides  clarification  regarding other
implementation  issues.  The  Company will adopt Fin No 46 in its quarter ending
March  31,  2004.  Adoption  of Fin No. 46 is not expected to have a significant
impact  on the Company's financial position, results of operations or liquidity.


                                       18
<PAGE>
RISK  FACTORS

INFLATION MAY AFFECT OUR ABILITY TO SELL MERCHANDISE AT THE 99 CENTS PRICE POINT

     Our  ability  to provide quality merchandise at the 99 cents price point is
subject  to  certain  economic  factors, which are beyond our control, including
inflation.  Inflation  could  have a material adverse effect on our business and
results  of  operations, especially given the constraints on our ability to pass
on  any  incremental  costs  due to price increases or other factors. We believe
that  we  will  be  able  to  respond to ordinary price increases resulting from
inflationary pressures by adjusting the number of items sold at the single price
point  (e.g., two items for 99 cents instead of three items for 99 cents) and by
changing  our  selection  of  merchandise.  Nevertheless,  a  sustained trend of
significantly  increased  inflationary  pressure could require us to abandon our
single  price  point  of  99 cents per item, which could have a material adverse
effect on our business and results of operations. See also "We are vulnerable to
uncertain  economic  factors,  changes  in  the  minimum  wage  and  workers'
compensation"  for  a  discussion  of additional risks attendant to inflationary
conditions.

WE DEPEND MAINLY ON NEW STORE OPENINGS OUTSIDE OF OUR TRADITIONAL CORE MARKET OF
SOUTHERN  CALIFORNIA  FOR  FUTURE  GROWTH

     Our sales and operating income growth results depend largely on our ability
to  open  and  operate  new  stores  outside  of  our traditional core market of
Southern  California successfully and to manage a larger business profitably. In
2002  and  2003, we opened 28 and 38 99 Cents Only Stores, respectively. We also
plan  to grow retail square footage at a rate of approximately 25% per year. Our
strategy  depends  on  many  factors, including our ability to identify suitable
markets  and  sites  for our new stores, negotiate leases with acceptable terms,
refurbish  stores,  successfully  compete against local competition, upgrade our
financial  and  management  information  systems  and  controls  and  manage our
operating  expenses.  In  addition,  we must be able to continue to hire, train,
motivate  and  retain  competent  managers  and  store  personnel. Many of these
factors  are  beyond our control. As a result, we cannot assure you that we will
be  able  to  achieve  our  expansion  goals.  Any  failure by us to achieve our
expansion  goals  on  a  timely  basis, obtain acceptance in markets in which we
currently  have  limited or no presence, attract and retain management and other
qualified  personnel,  appropriately  upgrade  our  financial  and  management
information  systems  and  controls or manage operating expenses could adversely
affect  our  future  operating  results  and our ability to execute our business
strategy.

     We  also  cannot  assure you that we will improve our results of operations
when  we  open new stores. A variety of factors, including store location, store
size,  rental  terms,  competition,  the  level  of store sales and the level of
initial  advertising  influence if and when a store becomes profitable. Assuming
that  our planned expansion occurs as anticipated, our store base will include a
relatively  high proportion of stores with relatively short operating histories.
We  cannot  assure  you  that our new stores will achieve the sales per saleable
square foot and store-level operating margins currently achieved at our existing
stores.  If our new stores on average fail to achieve these results, our planned
expansion could produce a decrease in our overall sales per saleable square foot
and  store-level  operating  margins.  Increases in the level of advertising and
pre-opening  expenses  associated  with  the  opening  of  new stores could also
contribute  to  a decrease in our operating margins. Finally, the opening of new
stores  in  existing markets has in the past and may in the future reduce retail
sales of existing stores in those markets, negatively affecting comparable store
sales.

OUR  OPERATIONS  ARE  CONCENTRATED  IN  CALIFORNIA

     Currently,  all  but  44  of  our  194, 99 Cents Only Stores are located in
California.  We operate 10 stores in Las Vegas, Nevada, 15 stores in Arizona and
19  stores in Houston, Texas. We expect that we will continue to open additional
stores  in California, as well as in Nevada, Arizona and Texas. Accordingly, our
results  of operations and financial condition largely depend upon trends in the
California  economy. If retail spending declines due to an economic slow-down or
recession  in  California,  we cannot assure you that our operations will not be
negatively  impacted.

          In  addition,  California  historically has been vulnerable to certain
natural  disasters and other risks, such as earthquakes, fires, floods and civil
disturbance.  At  times,  these  events  have disrupted the local economy. These
events  could  also  pose  physical  risks  to  our  properties.

WE COULD EXPERIENCE DISRUPTIONS IN RECEIVING AND DISTRIBUTION

     Our  success  depends upon whether our receiving and shipment schedules are
organized  and  well  managed.  As  we  continue to grow, we may face unexpected
demands  on  our  warehouse  operations,  as  well  as unexpected demands on our
transportation  network,  which could cause delays in delivery of merchandise to
or  from  our  warehouses to our stores. A fire, earthquake or other disaster at
our  warehouses  could  hurt  our  business,  financial condition and results of
operations,  particularly  because much of our merchandise consists of closeouts
and  other  irreplaceable  products.  Although we maintain standard property and
business  interruption  insurance,  we  do  not have earthquake insurance on our
properties.  Although  we try to limit our risk of exposure to potential product
liability  claims,  we  do  not  know  if  the limitations in our agreements are
enforceable.  We maintain insurance covering damage from use of our products. If
any  product  liability claim is successful and large enough, our business could
suffer.

WE  DEPEND  UPON  OUR  RELATIONSHIPS  WITH OUR SUPPLIERS AND THE AVAILABILITY OF
CLOSE-OUT  AND  SPECIAL-SITUATION  MERCHANDISE

     Our  success  depends  in  large part on our ability to locate and purchase
quality  close-out  and special-situation merchandise at attractive prices. This
helps  us  maintain  a  mix  of name-brand and other merchandise at the 99 Cents
price  point.  We  cannot  be  certain that such merchandise will continue to be
available  in  the  future  at  a  price that will be consistent with historical
costs.  Further,  we  may  not  be  able  to  find  and  purchase merchandise in
quantities  necessary  to  accommodate  our  growth. Additionally, our suppliers
sometimes  restrict  the  advertising,  promotion  and method of distribution of
their  merchandise. These restrictions in turn may make it more difficult for us
to  quickly  sell  these  items  from  our  inventory.  Although  we believe our
relationships  with  our suppliers are good, we do not have long-term agreements
with  any  supplier.  As  a  result,  we  must  continuously  seek  out  buying
opportunities  from  our existing suppliers and from new sources. We compete for
these  opportunities  with  other  wholesalers  and  retailers,  discount  and
deep-discount chains, mass merchandisers, food markets, drug chains, club stores
and  various privately-held companies and individuals. Although we do not depend
on  any  single  supplier  or group of suppliers and believe we can successfully
compete  in  seeking  out  new  suppliers,  a  disruption in the availability of
merchandise  at  attractive  prices  could  impair  our  business.


                                       19
<PAGE>
WE  PURCHASE  IN  LARGE  VOLUMES  AND  OUR  INVENTORY  IS  HIGHLY  CONCENTRATED

     To obtain inventory at attractive prices, we take advantage of large volume
purchases,  close-outs  and other special situations. As a result, our inventory
levels  are generally higher than other discount retailers. At December 31, 2002
and  2003,  we recorded net inventory value of $83.2 million and $105.6 million,
respectively.  We  periodically review the net realizable value of our inventory
and  make  adjustments  to  its  carrying  value  when  appropriate. The current
carrying value of our inventory reflects our belief that we will realize the net
values  recorded  on our balance sheet. However, we may not be able to do so. If
we  sell  large  portions  of  our inventory at amounts less than their carrying
value  or  if  we  write  down  a significant part of our inventory, our cost of
sales, gross profit, operating income and net income could suffer greatly during
the period in which such event or events occur. Margins could also be negatively
affected  should the grocery category sales continue to expand in importance and
become  a  larger  percentage  of  total  sales  in  the  future.

WE  FACE  STRONG  COMPETITION

     We  compete  in  both  the acquisition of inventory and sale of merchandise
with  other  wholesalers,  discount and deep-discount stores, single price point
merchandisers,  mass  merchandisers,  food markets, drug chains, club stores and
other  retailers.  In the future, new companies may also enter the deep-discount
retail  industry. Additionally, we currently face increasing competition for the
purchase  of  quality close-out and other special-situation merchandise. Some of
our  competitors have substantially greater financial resources and buying power
than  us.  Our  capability  to compete will depend on many factors including our
ability to successfully purchase and resell merchandise at lower prices than our
competitors.  We  cannot assure you that we will be able to compete successfully
against  our  current  and  future  competitors.

WE ARE VULNERABLE TO UNCERTAIN ECONOMIC FACTORS, CHANGES IN THE MINIMUM WAGE AND
WORKERS'  COMPENSATION  AND  HEALTHCARE  COSTS

     Our  ability  to  provide  quality  merchandise at our 99 Cents price point
could  be hindered by certain economic factors beyond our control, including but
not  limited  to:

- increases in inflation;
- increases in operating costs;
- increases in employee healthcare costs;
- increases in workers' compensation benefits;
- increases in prevailing wage levels;
- increases in legal costs;
- increases in government regulatory cost and
- decreases in consumer confidence levels.

     In  January  2001,  California enacted a minimum wage increase of $0.50 per
hour  with  an  additional  $0.50 increase required in January 2002. In 2001 and
2002, annual payroll expenses as a percentage of sales increased less than 1.0%.
Self-insured  workers'  compensation  reserves are subject to actuarial reviews,
which could increase the overall cost of workers' compensation benefits. Because
we  provide  consumers  with  merchandise  at  a  99 cents fixed price point, we
typically  cannot  pass  on  cost  increases  to  our  customers.

WE  FACE  RISKS  ASSOCIATED  WITH  INTERNATIONAL  SALES  AND  PURCHASES

     Although  international  sales  historically have not been important to our
overall  net  sales,  they  have  contributed  to  historical  growth in Bargain
Wholesale's  net  sales.  In  addition,  some  of  the  inventory we purchase is
manufactured  outside  the  United  States. There are many risks associated with
doing business internationally. Our international transactions may be subject to
risks  such  as:

- political instability;
- currency  fluctuations;
- exchange  rate  controls;
- changes  in  import  and  export  regulations;  and
- changes  in  tariff  and  freight  rates.

     The  United  States and other countries have also proposed various forms of
protectionist  trade  legislation.  Any  resulting  changes  in  current  tariff
structures or other trade policies could lead to fewer purchases of our products
and  could  adversely  affect  our  international  operations.

WE  COULD  ENCOUNTER  RISKS  RELATED  TO  TRANSACTIONS  WITH  OUR  AFFILIATES

     We currently lease 12 of our 99 Cents Only Stores and a parking lot for one
of  these  stores  from certain members of the Gold family and their affiliates.
Our  annual  rental  expense for these facilities totaled approximately $2.2 and
$2.1  million  in  each of 2001 and 2002. In addition, one of our directors, Ben
Schwartz,  is  a  trustee  of  a trust that owns a property on which a single 99
Cents  Only  Store  is  located.  We  believe  that  our lease terms are just as
favorable  to  us  as  they  would  be for an unrelated party. Under our current
policy,  we enter into real estate transactions with our affiliates only for the
renewal  or  modification of existing leases and on occasions where we determine
that  such  transactions  are  in  our best interests. Moreover, the independent
members  of  our  Board  of  Directors  must unanimously approve all real estate
transactions  between  the  Company and our affiliates. They must also determine
that  such  transactions are equivalent to a negotiated arm's-length transaction
with  a  third party. We cannot guarantee that we will reach agreements with the
Gold  family  on  renewal terms for the properties we currently lease from them.
Also,  even if we agree to such terms, we cannot be certain that our independent
directors  will  approve them. If we fail to renew one of these leases, we could
be  forced to relocate or close the leased store. Any relocations or closures we
experience  will  be  costly  and  could  adversely  affect  our  business.


                                       20
<PAGE>
WE  RELY  HEAVILY  ON  OUR  MANAGEMENT  TEAM

     Our  success  depends  substantially  on  David Gold and Eric Schiffer, our
Chief  Executive  Officer  and  President,  respectively.  We  also  rely on the
continued  service  of  our executive officers and other key management. We have
not entered into employment agreements with any of our executive officers and we
do  not  maintain key person life insurance on them. As we continue to grow, our
success will depend on our ability to identify, attract, hire, train, retain and
motivate  other  highly  skilled  management  personnel.  Competition  for  such
personnel is intense, and we may not be able to successfully attract, assimilate
or  retain  sufficiently  qualified  candidates.

OUR  OPERATING  RESULTS  MAY  FLUCTUATE  AND  MAY BE AFFECTED BY SEASONAL BUYING
PATTERNS

     Historically,  our  highest  net  sales  and operating income have occurred
during  the  fourth  quarter, which includes the Christmas and Halloween selling
seasons.  During  2002  and  2003,  we  generated approximately 29.5% and 28.7%,
respectively,  of  our net sales and approximately 32.7% and 26.6% respectively,
of  our  operating  income  during  the  fourth  quarter.  If for any reason the
Company's  net sales were to fall below norms during the fourth quarter it could
have an adverse impact on our profitability and impair our results of operations
for  the entire year. Adverse weather conditions or other disruptions during the
peak  holiday  season  could also affect our net sales and profitability for the
year.

     In  addition  to  seasonality,  many other factors may cause our results of
operations  to vary significantly from quarter to quarter. Some of these factors
are  beyond  our  control.  These  factors  include:

- the number of new stores and timing of new store openings;
- the level of advertising and pre-opening expenses associated with new stores;
- the integration of new stores into our operations;
- general economic health of the deep-discount retail industry;
- changes in the mix of products sold;
- unexpected increases in shipping costs;
- ability to successfully manage our inventory levels;
- changes in our personnel;
- fluctuations in the amount of consumer spending;
- the amount and timing of operating costs and capital expenditures relating to
  the growth of our business.

WE  ARE  SUBJECT  TO  ENVIRONMENTAL  REGULATIONS

     Under  various federal, state and local environmental laws and regulations,
current  or  previous  owners or occupants of property may become liable for the
costs of removing any hazardous substances found on the property. These laws and
regulations  often  impose liability without regard to fault. As of December 31,
2003,  we leased all but 30 of our stores and own three distribution facilities.
However,  in  the  future  we  may  be  required  to incur substantial costs for
preventive  or  remedial  measures  associated  with  the  presence of hazardous
materials.  In  addition, we operate one underground diesel storage tank and one
above-ground propane storage tank at our Southern California warehouse. Although
we  have  not  been notified of, and are not aware of, any current environmental
liability,  claim  or non-compliance, we could incur costs in the future related
to  our  leased  properties and our storage tanks. In the ordinary course of our
business,  we sometimes handle or dispose of commonplace household products that
are  classified  as  hazardous  materials  under  various environmental laws and
regulations.  We  have  adopted  policies regarding the handling and disposal of
these products, and we train our employees on how to handle and dispose of them.
We  cannot  assure  you that our policies and training will successfully help us
avoid  potential  violations  of these environmental laws and regulations in the
future.

ANTI-TAKEOVER  EFFECT;  CONCENTRATION  OF OWNERSHIP BY OUR EXISTING OFFICERS AND
PRINCIPAL  STOCKHOLDERS

     In  addition  to some governing provisions in our Articles of Incorporation
and Bylaws, we are also subject to certain California laws and regulations which
could  delay,  discourage  or prevent others from initiating a potential merger,
takeover  or other change in our control, even if such actions would benefit our
shareholders  and  us.  Moreover  David  Gold,  our Chairman and Chief Executive
Officer,  and  members  of  his immediate family and certain of their affiliates
beneficially  own  as  of  December  31,  2003,  22,736,242  or  31.9% of shares
outstanding.  As  a  result,  they  have  the  ability  to influence all matters
requiring  the vote of our shareholders, including the election of our directors
and  most  of  our  corporate  actions.  They  can also control our policies and
potentially  prevent  a  change  in our control. This could adversely affect the
voting  and  other rights of our other shareholders and could depress the market
price  of  our  common  stock.

OUR  STOCK  PRICE  COULD  FLUCTUATE  WIDELY

     The  market  price  of  our  common stock has risen substantially since our
initial  public  offering  on  May 23, 1996. Trading prices for our common stock
could  fluctuate  significantly  due  to  many  factors,  including:

- the  depth  of  the  market  for  our  common  stock;
- changes  in  expectations  of  our  future  financial  performance, including
  financial  estimates  by  securities  analysts  and  investors;
- variations  in  our  operating  results;
- conditions  or trends in our industry or industries of any of our significant
  clients;
- the  conditions  of  the  market  generally;
- additions  or  departures  of  key  personnel;  and
- future  sales  of  our  common  stock.


                                       21
<PAGE>
RISKS  COULD  ARISE  DUE  TO  OUR  USE OF ARTHUR ANDERSEN LLP AS OUR INDEPENDENT
AUDITORS

     There may be no effective remedy against Arthur Andersen LLP, which audited
our  financial  statements  for  the  years ended December 31, 2000 and 2001, in
connection  with  a  material  misstatement  or  omission  in  those  financial
statements,  or in connection with any other claim arising from its provision of
auditing  and  other  services to us. On September 15, 2002, Arthur Andersen was
convicted  of  obstructing  justice  in  connection with investigations of their
former  client  Enron  Corp.  Arthur  Andersen  ceased practicing before the SEC
effective  August  31,  2002.  Our  inability  to include in future registration
statements  or  reports  financial  statements  for one or more years audited by
Arthur  Andersen LLP or to obtain Arthur Andersen LLP's consent to the inclusion
of  their report on our 2000 and 2001 financial statements may impede our access
to the capital markets. Should we seek to access the public capital markets, SEC
rules  will  require us to include or incorporate by reference in any prospectus
three  years  of  audited  financial  statements.  Until  our  audited financial
statements  for  the  fiscal year ending December 31, 2004 become available, the
SEC's current rules would require us to present audited financial statements for
one  or more fiscal years audited by Arthur Andersen LLP. Prior to that time the
SEC  may cease accepting financial statements audited by Arthur Andersen LLP, in
which  case  we  would  be  unable  to  access the public capital markets unless
PricewaterhouseCoopers  LLP, our current independent accounting firm, or another
independent  accounting  firm,  is  able  to  audit  the  financial  statements
originally  audited  by  Arthur  Andersen  LLP.  In addition, as a result of the
departure  of  our  former  engagement  team  leaders, Arthur Andersen LLP is no
longer  in  a position to consent to the inclusion or incorporation by reference
in  any  prospectus  of their report on our audited financial statements for the
year  ended  December  31,  2000  and  December  31,  2001, and investors in any
subsequent offerings for which we use their audit report will not be entitled to
recovery  against  them  under  Section 11 of the Securities Act of 1933 for any
material misstatements or omissions in those financial statements. Consequently,
our  financing costs may increase or we may miss attractive market opportunities
if  either  our  annual financial statements for 2000 and 2001 audited by Arthur
Andersen  LLP should cease to satisfy the SEC's requirements or those statements
are  used in a prospectus but investors are not entitled to recovery against our
auditors  for  material  misstatements  or  omissions  in  them.

ITEM  7A.     QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT  MARKET  RISK

     The  Company  is  exposed  to  interest  rate  risk  for its investments in
marketable  securities,  but  management  believes  the risk is not material. At
December  31, 2003, the Company had $199.0 million in marketable securities with
most  of the securities maturing at various dates through November 2009 with one
security  with  market  value  of  $4.5  million  maturing  in June 2018 and one
security  with  market  value  of  $0.5  million  maturing  in October 2028. The
Company's  investments  are  comprised primarily of investment grade federal and
municipal  bonds  and  commercial paper. The Company generally holds investments
until  maturity,  and  therefore  should not bear any interest risk due to early
disposition.  We  do  not  enter  into  any  derivative or interest rate hedging
transactions.  Any  premium  or  discount  recognized  upon  the  purchase of an
investment. At December 31, 2003, the fair value of investments approximated the
carrying  value.


                                       22
<PAGE>
ITEM  8.  FINANCIAL  STATEMENTS  AND  SUPPLEMENTARY  DATA

                          INDEX TO FINANCIAL STATEMENTS
                              99 CENTS ONLY STORES


Reports of Independent Public Auditors. . . . . . . . . . . . . . . . . .  24-25

Balance Sheets as of December 31, 2002 and 2003 . . . . . . . . . . . . .  26-27

Statements of Income for the years ended
December 31, 2001, 2002 and 2003. . . . . . . . . . . . . . . . . . . . .     28

Statements of Shareholders' Equity  for the years ended
December 31, 2001, 2002 and 2003. . . . . . . . . . . . . . . . . . . . .     29

Statements of Cash Flows for the years ended
December 31, 2001, 2002 and 2003. . . . . . . . . . . . . . . . . . . . .     30

Notes to Financial Statements . . . . . . . . . . . . . . . . . . . . . .  31-38


                                       23
<PAGE>
REPORT  OF  INDEPENDENT  PUBLIC  AUDITORS

To Board of Directors and Shareholders of 99 Cents Only Stores:

     In  our  opinion,  the  consolidated  financial  statements  listed  in the
accompanying  index  present  fairly, in all material respects, the consolidated
financial  position  of  99 Cents Only Stores and its subsidiary at December 31,
2003  and  2002 and the results of its operations and its cash flows for each of
the  two  years  in  the  period  ended  December  31,  2003  in conformity with
accounting  principles generally accepted in the United States of America. These
financial  statements  are  the  responsibility of the Company's management; our
responsibility  is  to express an opinion on these financial statements based on
our  audits.  We  conducted  our  audits  of these statements in accordance with
auditing  standards  generally  accepted  in the United States of America, which
require  that we plan and perform the audit to obtain reasonable assurance about
whether  the  financial  statements  are free of material misstatement. An audit
includes  examining,  on  a  test  basis,  evidence  supporting  the amounts and
disclosures  in  the  financial  statements, assessing the accounting principles
used  and  significant  estimates made by management, and evaluating the overall
financial  statement  presentation.  We  believe  that  our  audits  provide  a
reasonable  basis  for  our  opinion.  The financial statements of 99 Cents Only
Stores  for  the year ended December 31, 2001, were audited by other independent
accountants  who have ceased operations. Those independent accountants expressed
an  unqualified  opinion  on  those  financial  statements in their report dated
February  20,  2002.

PricewaterhouseCoopers LLP
Los Angeles, California
February 27, 2004


                                       24
<PAGE>
REPORT OF FORMER INDEPENDENT PUBLIC ACCOUNTANTS

THE  FOLLOWING REPORT IS A COPY OF A REPORT PREVIOUSLY ISSUED BY ARTHUR ANDERSEN
LLP  (ANDERSEN).  THIS REPORT HAS NOT BEEN REISSUED BY ANDERSEN AND ANDERSEN DID
NOT  CONSENT  TO  THE  INCORPORATION BY REFERENCE OF THIS REPORT (AS INCLUDED IN
THIS  FORM  10-K)  INTO  ANY  OF  THE  COMPANY'S  REGISTRATION  STATEMENTS.

TO THE SHAREHOLDERS AND BOARD OF DIRECTORS OF 99 CENTS ONLY STORES:

     We  have audited the accompanying balance sheets of 99 Cents Only Stores (a
California  Corporation)  as  of  December  31,  2000  and  2001 and the related
statements  of income, shareholders' equity and cash flows for each of the three
years  in the period ended December 31, 2001. These financial statements are the
responsibility  of the Company's management. Our responsibility is to express an
opinion  on  these  financial  statements  based  on  our  audits.

     We  conducted  our  audits  in accordance with auditing standards generally
accepted  in the United States. Those standards require that we plan and perform
the  audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence  supporting the amounts and disclosures in the financial statements. An
audit  also  includes  assessing  the accounting principles used and significant
estimates  made  by  management,  as  well  as  evaluating the overall financial
statement  presentation.  We  believe that our audits provide a reasonable basis
for  our  opinion.

     In  our opinion, the financial statements referred to above present fairly,
in  all  material respects, the financial position of 99 Cents Only Stores as of
December 31, 2000 and 2001, and the results of its operations and its cash flows
for  each of the three years in the period ended December 31, 2001 in conformity
with  accounting  principles  generally  accepted  in  the  United  States.

ARTHUR  ANDERSEN  LLP

Los Angeles, California
February 20, 2002
(Except for the matters discussed
in Note 13, as to which date is
March 9, 2002)


                                       25
<PAGE>
<TABLE>
<CAPTION>
                              99 CENTS ONLY STORES
                                 BALANCE SHEETS
                        AS OF DECEMBER 31, 2002 AND 2003

                    (AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

                                     ASSETS


                                                                    2002      2003
                                                                 --------  --------
<S>                                                              <C>       <C>

CURRENT ASSETS:
Cash. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    7,985       318
Short-term investments. . . . . . . . . . . . . . . . . . . . .  146,857   145,670
Accounts receivable, net of allowance for doubtful accounts of
  $149 and $143 as of December 31, 2002 and 2003, respectively.    2,753     2,245
Due from shareholder. . . . . . . . . . . . . . . . . . . . . .    1,232         -
Income tax receivable . . . . . . . . . . . . . . . . . . . . .        -       841
Deferred income taxes . . . . . . . . . . . . . . . . . . . . .   11,927    15,927
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . .   83,176   107,409
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    2,869     2,717
                                                                 --------  --------
  Total current assets. . . . . . . . . . . . . . . . . . . . .  256,799   275,127
PROPERTY AND EQUIPMENT, at cost:
Land. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   26,779    35,680
Building and improvements . . . . . . . . . . . . . . . . . . .   29,216    53,590
Leasehold improvements. . . . . . . . . . . . . . . . . . . . .   70,887   100,666
Fixtures and equipment. . . . . . . . . . . . . . . . . . . . .   42,018    56,124
Transportation equipment. . . . . . . . . . . . . . . . . . . .    3,045     3,217
Construction in progress. . . . . . . . . . . . . . . . . . . .   14,105    35,279
                                                                 --------  --------
  Total properties, fixtures and equipment. . . . . . . . . . .  186,050   284,556
Accumulated depreciation and amortization . . . . . . . . . . .  (58,490)  (81,991)
                                                                 --------  --------
  Total net property and equipment. . . . . . . . . . . . . . .  127,560   202,565

OTHER ASSETS:
Long term deferred income taxes . . . . . . . . . . . . . . . .    9,817     9,717
Long term investments in marketable securities. . . . . . . . .   37,223    52,789
Long term investments in partnerships . . . . . . . . . . . . .    4,565     4,366
Deposits other assets . . . . . . . . . . . . . . . . . . . . .    6,612     8,674
                                                                 --------  --------
   Total other assets . . . . . . . . . . . . . . . . . . . . .   58,217    75,546
                                                                 --------  --------
TOTAL ASSETS. . . . . . . . . . . . . . . . . . . . . . . . . .  442,576   553,238
                                                                 ========  ========
</TABLE>


   THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.


                                       26
<PAGE>
<TABLE>
<CAPTION>
                              99 CENTS ONLY STORES
                                 BALANCE SHEETS
                        AS OF DECEMBER 31, 2002 AND 2003

                    (AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

                      LIABILITIES AND SHAREHOLDERS' EQUITY


                                                                 2002      2003
                                                               --------  --------
<S>                                                            <C>       <C>
CURRENT LIABILITIES:
Current portion of capital lease obligation . . . . . . . . .  $     40  $     40
Accounts payable. . . . . . . . . . . . . . . . . . . . . . .    16,946    27,903
Accrued expenses:
   Payroll and payroll-related. . . . . . . . . . . . . . . .     3,652     3,592
   Sales tax. . . . . . . . . . . . . . . . . . . . . . . . .     4,329     4,749
   Other. . . . . . . . . . . . . . . . . . . . . . . . . . .     2,176     4,622
   Workers' compensation. . . . . . . . . . . . . . . . . . .     7,725    16,319
   Income taxes payable . . . . . . . . . . . . . . . . . . .     6,184         -
                                                               --------  --------
      Total current liabilities . . . . . . . . . . . . . . .    41,052    57,225

LONG-TERM LIABILITIES:
Deferred rent . . . . . . . . . . . . . . . . . . . . . . . .     2,210     2,460
Deferred compensation liability . . . . . . . . . . . . . . .     1,102     2,114
Capital lease obligation, net of current portion. . . . . . .     1,597     1,553
                                                               --------  --------
      Total non-current liabilities . . . . . . . . . . . . .     4,909     6,127

COMMITMENTS AND CONTINGENCIES: (Note 9) . . . . . . . . . . .         -         -

SHAREHOLDERS' EQUITY:
Preferred stock, no par value
      Authorized-1,000,000 shares
      Issued and outstanding-none . . . . . . . . . . . . . .         -         -
Common stock, no par value
      Authorized-100,000,000 shares
      Issued and outstanding 70,369,178 at December 31, 2002
         and 72,032,788 at December 31, 2003. . . . . . . . .   174,152   210,893
      Retained earnings . . . . . . . . . . . . . . . . . . .   222,463   278,993
                                                               --------  --------
   Total shareholders' equity . . . . . . . . . . . . . . . .   396,615   489,886
                                                               --------  --------
   Total liabilities and shareholders' equity . . . . . . . .  $442,576  $553,238
                                                               ========  ========
</TABLE>


   THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.


                                       27
<PAGE>
<TABLE>
<CAPTION>
                                  99 CENTS ONLY STORES
                                  STATEMENTS OF INCOME
                      YEARS ENDED DECEMBER 31, 2001, 2002 AND 2003
                     (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)


                                                          2001       2002       2003
                                                        ---------  ---------  ---------
<S>                                                     <C>        <C>        <C>
NET SALES:
   99 Cents Only Stores. . . . . . . . . . . . . . . .  $522,019   $663,983   $816,348
   Bargain Wholesale . . . . . . . . . . . . . . . . .    56,250     49,959     46,112
                                                        ---------  ---------  ---------
     Total sales . . . . . . . . . . . . . . . . . . .   578,269    713,942    862,460
COST OF SALES. . . . . . . . . . . . . . . . . . . . .   350,421    427,356    516,686
                                                        ---------  ---------  ---------
   Gross profit. . . . . . . . . . . . . . . . . . . .   227,848    286,586    345,774
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES:
   Operating expenses. . . . . . . . . . . . . . . . .   141,544    178,374    234,626
   Depreciation and amortization . . . . . . . . . . .    12,354     17,711     23,763
                                                        ---------  ---------  ---------
     Total SG&A. . . . . . . . . . . . . . . . . . . .   153,898    196,085    258,389
   Operating income. . . . . . . . . . . . . . . . . .    73,950     90,501     87,385
OTHER (INCOME) EXPENSE:
   Interest income . . . . . . . . . . . . . . . . . .    (4,583)    (3,535)    (3,105)
   Interest expense. . . . . . . . . . . . . . . . . .        92        128        125
   Other . . . . . . . . . . . . . . . . . . . . . . .    (1,440)    (1,440)    (1,477)
                                                        ---------  ---------  ---------
     Total other (income). . . . . . . . . . . . . . .    (5,931)    (4,847)    (4,457)
                                                        ---------  ---------  ---------
   Income before provision for income tax. . . . . . .    79,881     95,348     91,842
Provision for income taxes . . . . . . . . . . . . . .    31,438     36,374     35,313
                                                        ---------  ---------  ---------
NET INCOME . . . . . . . . . . . . . . . . . . . . . .  $ 48,443   $ 58,974   $ 56,529
                                                        ---------  ---------  ---------


EARNINGS PER COMMON SHARE:
   Basic . . . . . . . . . . . . . . . . . . . . . . .  $   0.70   $   0.84   $   0.79
   Diluted . . . . . . . . . . . . . . . . . . . . . .  $   0.69   $   0.83   $   0.78

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
   Basic . . . . . . . . . . . . . . . . . . . . . . .    68,815     69,938     71,348
   Diluted . . . . . . . . . . . . . . . . . . . . . .    70,009     71,181     72,412
</TABLE>


   THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.


                                       28
<PAGE>
<TABLE>
<CAPTION>
                              99 CENTS ONLY STORES
                       STATEMENTS OF SHAREHOLDERS' EQUITY
                  YEARS ENDED DECEMBER 31, 2001, 2002 AND 2003
                             (AMOUNTS IN THOUSANDS)


                                                COMMON STOCK     RETAINED
                                               SHARES   AMOUNT   EARNINGS
                                               ------  --------  ---------
<S>                                            <C>     <C>       <C>
BALANCE, December 31, 2000. . . . . . . . . .  68,408  $138,487  $ 115,046
   Net income . . . . . . . . . . . . . . . .       -         -     48,443
   Tax benefit from exercise of stock options       -     6,205          -
   Proceeds from exercise of stock options. .   1,098    11,462          -
                                               ------  --------  ---------
BALANCE, December 31, 2001. . . . . . . . . .  69,506  $156,154  $ 163,489
   Net income . . . . . . . . . . . . . . . .       -         -     58,974
   Tax benefit from exercise of stock options       -     5,053          -
   Proceeds from exercise of stock options. .     863    12,945          -
                                               ------  --------  ---------
BALANCE, December 31, 2002. . . . . . . . . .  70,369  $174,152  $ 222,464
                                               ------  --------  ---------
   Net income                                                       56,529
   Tax benefit from exercise of stock options            11,041          -
   Proceeds from exercise of stock options. .   1,664    25,700          -
                                               ------  --------  ---------
BALANCE, December 31, 2003. . . . . . . . . .  72,033  $210,893  $ 278,993
                                               ======  ========  =========
</TABLE>


   THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.


                                       29
<PAGE>
<TABLE>
<CAPTION>
                                                99 CENTS ONLY STORES
                                              STATEMENTS OF CASH FLOWS
                                    YEARS ENDED DECEMBER 31, 2001, 2002 AND 2003
                                               (AMOUNTS IN THOUSANDS)


                                                                                     2001      2002        2003
                                                                                   --------  ---------  ----------
<S>                                                                                <C>       <C>        <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   48,443     58,974      56,529
Adjustments to reconcile net income to net cash provided by operating activities:
   Depreciation and amortization. . . . . . . . . . . . . . . . . . . . . . . . .   12,354     17,711      23,643
    Tax benefit from exercise of non qualified employee stock options . . . . . .    6,205      5,053      11,041
   Benefit from deferred income taxes . . . . . . . . . . . . . . . . . . . . . .   (2,847)    (6,056)     (3,900)
Changes in asset and liabilities associated with operating activities:
   Accounts receivable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       46        770         507
   Inventories. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (2,835)   (16,648)    (24,233)
   Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       74        134        (777)
   Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       12       (150)        (89)
   Due to shareholders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    1,655     (2,887)      1,232
   Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    2,622      3,538      10,956
   Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      672      1,977       2,808
   Accrued workers' compensation. . . . . . . . . . . . . . . . . . . . . . . . .    2,770      2,191       8,594
   Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   (1,936)     7,567      (7,025)
   Deferred rent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      (81)       149         250
                                                                                   --------  ---------  ----------
     Net cash provided by operating activities. . . . . . . . . . . . . . . . . .   67,154     72,323      79,536
CASH FLOWS FROM INVESTING ACTIVITIES:
   Purchases of property and equipment. . . . . . . . . . . . . . . . . . . . . .  (46,888)   (41,631)    (98,648)
   Purchases of short-term investments. . . . . . . . . . . . . . . . . . . . . .  (35,802)   (35,981)    (14,378)
   Investments in partnerships. . . . . . . . . . . . . . . . . . . . . . . . . .   (4,702)       137         166
                                                                                   --------  ---------  ----------
     Net cash used in investing activities. . . . . . . . . . . . . . . . . . . .  (87,392)   (77,475)   (112,860)
CASH FLOWS FROM FINANCING ACTIVITIES:
   Payments of capital lease obligation . . . . . . . . . . . . . . . . . . . . .      (26)       (40)        (44)
   Proceeds from exercise of stock options. . . . . . . . . . . . . . . . . . . .   11,462     12,945      25,701
                                                                                   --------  ---------  ----------
     Net cash provided by financing activities. . . . . . . . . . . . . . . . . .   11,436     12,905      25,657
NET INCREASE (DECREASE) IN CASH . . . . . . . . . . . . . . . . . . . . . . . . .   (8,802)     7,753      (7,667)
CASH, beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    9,034        232       7,985
                                                                                   --------  ---------  ----------
CASH, end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      232      7,985         318
                                                                                   ========  =========  ==========

NON CASH INVESTING AND FINANCING ACTIVITIES
   Asset acquired under capital lease . . . . . . . . . . . . . . . . . . . . . .    1,703   $      -   $       -
                                                                                   ========  =========  ==========
</TABLE>


   THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.


                                       30
<PAGE>
                              99 CENTS ONLY STORES
                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2003

1.   LINE OF BUSINESS

     99  Cents  Only  Stores  (the  Company)  is  incorporated  in  the State of
California.  The Company retails various consumable products through its 151 and
189  stores  at  December 31, 2002 and 2003, respectively. The Company is also a
wholesale  distributor  of  various  consumable  products.

2.   CONCENTRATION OF OPERATIONS IN CALIFORNIA

     All but 41 of our 99 Cents Only Stores at December 31, 2003 were located in
California. The Company operates 10 stores in Las Vegas, Nevada and 14 stores in
Arizona. The Company also opened 17 stores in Texas in 2003. The Company expects
that  it  will  continue  to  open additional stores in California as well as in
Nevada,  Arizona,  and  Texas.

3.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

CASH  AND  CASH  EQUIVALENTS

     The  Statements of Cash Flows classify changes in cash and cash equivalents
(short  term,  highly  liquid  investments readily convertible into cash with an
original  maturity  at  date  of  purchase of three months or less) according to
operating,  investing  or  financing activities. At times, cash balances held at
financial  institutions  are  in excess of federally insured limits. The Company
places  its  temporary  cash  investments  with  high  credit, quality financial
institutions  and  limits  the  amount  of  credit exposure to any one financial
institution.  The  Company  believes no significant concentration of credit risk
exists  with  respect  to  these  cash  investments.

USE  OF  ESTIMATES

     The  preparation  of the financial statements in conformity with accounting
principles  generally  accepted  in  the  United  States  of  America  requires
management to make estimates and assumptions that affect the reported amounts of
assets  and  liabilities  and disclosure of contingent assets and liabilities at
the  date  of  the financial statements and the reported amounts of revenues and
expenses  during  the  reporting  period. Actual results could differ from those
estimates.  Significant  estimates  include  self-insured  workers' compensation
reserves  and  inventory  reserves.

INVENTORIES

     Inventories  are  priced  at  the  lower  of  cost (first in, first out) or
market.  Valuation  allowances  are  recorded to properly state inventory at the
lower  of  cost  or  market.

DEPRECIATION  AND  AMORTIZATION

     Property  and  equipment  are  amortized and depreciated on a straight-line
basis  over  the  following  useful  lives  of  the  assets:

     Building and improvements . . .  27.5 - 30 years
     Leasehold improvements. . . . .  Lesser of 5 years or remaining lease term
     Fixtures and equipment. . . . .  5 years
     Transportation equipment. . . .  3 years

     The Company follows the policy of capitalizing expenditures that materially
increase asset lives and charging ordinary repairs and maintenance to operations
as  incurred.

IMPAIRMENT  OF  LONG-LIVED  ASSETS

     The Company reviews its long-lived assets for impairment whenever events or
changes indicate that the carrying amount of an asset or group of assets may not
be  recoverable.  In  evaluating whether an asset has been impaired, the Company
compares  the  anticipated undiscounted future cash flows to be generated by the
asset  to the asset's carrying value. If the sum of the undiscounted future cash
flows  is  less  than  the  carrying  amount of the asset, an impairment loss is
recognized.  No  losses  were recorded during the three years ended December 31,
2003.

LEASE  ACQUISITION  COSTS

     The  Company follows the policy of capitalizing expenditures that relate to
the  acquisition  and  signing  of  its  retail  store  leases.  These costs are
amortized  on  a  straight  line basis over the initial term of the lease, which
ranges  from  5  to  10  years.


                                       31
<PAGE>
EARNINGS  PER  SHARE

     "Basic"  earnings  per  share  is  computed  by  dividing net income by the
weighted  average  number of shares outstanding for the year. "Diluted" earnings
per  share  is  computed  by  dividing  net  income by the total of the weighted
average  number  of  shares  outstanding plus the dilutive effect of outstanding
stock  options  (applying  the  treasury  stock  method).

     A reconciliation of the basic weighted average number of shares outstanding
and  the  diluted  weighted average number of shares outstanding for each of the
three  years  in  the  period  ended  December  31,  2003  follows:

<TABLE>
<CAPTION>
                                                                 YEARS ENDED DECEMBER 31,
                                                              ------------------------------
                                                                  (Amounts in thousands)
                                                              ------------------------------
                                                                2001      2002       2003
                                                              --------  ---------  ---------
<S>                                                           <C>       <C>        <C>
Weighted average number of common shares
  Outstanding-Basic. . . . . . . . . . . . . . . . . . . . . .  68,815     69,938     71,348
Dilutive effect of outstanding stock options . . . . . . . . .   1,194      1,243      1,064
                                                              --------  ---------  ---------
Weighted average number of common shares outstanding-Diluted .  70,009     71,181     72,412
                                                              --------  ---------  ---------
</TABLE>

     1,989  thousand shares of common stock equivalents were excluded from this
calculation  as  they  were  anti-dilutive.

     The  Company  has  elected  to  continue  to  measure  compensation  costs
associated with its stock option plan under APB 25, "Accounting for Stock Issued
to  Employees"  and  accordingly, under SFAS No. 123 as amended by SFAS No. 148,
had  the Company applied the fair value based method of accounting, which is not
required,  to  all  grants  of  stock  options,  the Company would have recorded
additional  compensation expense and pro forma net income and earnings per share
amounts as follows for the years ended December 31, 2001, 2002 and 2003 (amounts
in  thousands,  except  for  per  share  data):

<TABLE>
<CAPTION>
                                                   DECEMBER 31,
                                 ------------------------------------------------
                                    AMOUNTS IN THOUSANDS EXCEPT PER SHARE DATA
                                 ------------------------------------------------
                                      2001            2002             2003
                                 --------------  ---------------  ---------------
<S>                              <C>             <C>              <C>
Net income, as reported. . . . . $       48,443  $        58,974  $        56,529
Additional compensation expense.          9,818            8,427            8,931
                                 --------------  ---------------  ---------------
Pro forma net income . . . . . . $       38,625  $        50,547  $        47,598
                                 ==============  ===============  ===============
Earnings per share:
Basic-as reported. . . . . . . . $         0.70  $          0.84  $          0.79
Basic-pro forma. . . . . . . . . $         0.56  $          0.72  $          0.67
Diluted-as reported. . . . . . . $         0.69  $          0.83  $          0.78
Diluted-pro forma. . . . . . . . $         0.55  $          0.71  $          0.66
</TABLE>

These  pro  forma  amounts  were determined by estimating the fair value of each
option  on  its grant date using the Black-Scholes option-pricing model with the
following  assumptions:

<TABLE>
<CAPTION>
                                            DECEMBER 31,
                                 --------------------------------
                                   2001       2002        2003
                                 ---------  ---------  ----------
<S>                              <C>        <C>        <C>
Risk free interest rate. . . . .     5.44%      1.90%       3.37%
Expected life. . . . . . . . . . 10 Years   10 Years   5.2 Years
Expected stock price volatility.       49%        51%         51%
Expected dividend yield. . . . .     None       None        None
</TABLE>

DEFERRED  RENT

     Certain  of the Company's operating leases for its retail locations include
scheduled  increases  in  monthly  payments. The Company has accounted for these
leases  to  provide  straight-line  charges  to operations over the lives of the
leases.

REVENUE  RECOGNITION

     Revenue  is  recognized  at  the  point of sale for retail sales. Wholesale
sales  revenue  is  recognized  on the date shipped. Wholesale sales are shipped
free  on board shipping point.  A reserve is maintained for incidental claims or
damages.  There  are  no  contingencies  or  wholesale  rights  of  return.

PRE-OPENING  COSTS

     The  Company  expenses,  as  incurred, all pre-opening costs related to the
opening  of  new  retail  stores.


                                       32
<PAGE>
ADVERTISING

     The  Company  expenses  advertising costs as incurred. Advertising expenses
were  $3.4  million,  $3.1  million  and  $3.8  million for 2001, 2002 and 2003,
respectively.

STATEMENTS  OF  CASH  FLOWS

     Cash  payments  for  income  taxes  were  $25,260,000,  $29,852,000  and
$35,200,000  in  2001,  2002  and  2003, respectively. Interest payments totaled
approximately  $92,000,  $128,000  and $125,000 for the years December 31, 2001,
2002  and  2003,  respectively.

FAIR  VALUE  OF  FINANCIAL  INSTRUMENTS

     The  Company's  financial  instruments  consist  of  cash,  short-term  and
long-term  investments,  short-term trade receivables and payables. The carrying
value  for  all such instruments approximate fair value at December 31, 2002 and
2003.

RECLASSIFICATIONS

     Certain reclassifications have been made to the prior year to confirm with
current  year  presentation.

NEW  AUTHORITATIVE  PRONOUNCEMENTS

     In  November 2002, the FASB issued FASB Interpretation No. 45, "Guarantor's
Accounting  and  Disclosure  Requirements  for  Guarantees,  Including  Indirect
Guarantees  of  Indebtedness of Others" ("FIN 45").  FIN 45 requires a guarantor
to recognize a liability at the inception of a guarantee equal to the fair value
of the obligation undertaken and elaborates on the disclosures to be made by the
guarantor.  The  disclosure  requirements  of FIN 45 are required for the fiscal
year ended December 31, 2002.  The recognition and measurement provisions of FIN
45  are  effective, on a prospective basis, for guarantees issued by the Company
beginning  in fiscal 2003.  The adoption of FIN 45 did not have an impact on the
Company's  financial  position  or  results  of  operations.

     In  January  2003,  the  FASB issued FIN No. 46, "Consolidation of Variable
Interest  Entities."  FIN 46 establishes a new and far-researching consolidation
accounting  model.  Although  FIN No 46 was initially focused on special purpose
entities,  the applicability of FIN No 46 goes beyond such entities and can have
applicability  to  franchise arrangements, regardless of whether the Company has
voting  or  ownership  control  of  such  franchisee. In response to a number of
comment  letters  and implementation questions, in December 2003 the FASB issued
FIN  No.  46R, which delays the effective date of FIN No 46 for certain entities
until  March  31,  2004,  as  well  as  provides  clarification  regarding other
implementation  issues.  The  Company will adopt Fin No 46 in its quarter ending
March  31,  2004.  Adoption  of FIN No. 46 is not expected to have a significant
impact  on the Company's financial position, results of operations or liquidity.

4.   INVESTMENTS

     Investments  in debt and equity securities are recorded as required by SFAS
No.  115,  "Accounting for Certain Investments in Debt and Equity Securities" as
trading  securities.  The  Company's  investments  are  comprised  primarily  of
investment  grade  federal  and  municipal  bonds  and  commercial  paper. As of
December  31,  2002  and  2003,  the  fair value of investments approximated the
carrying values and were invested as follows:

<TABLE>
<CAPTION>
                                            YEARS ENDED DECEMBER 31,
                      ------------------------------------------------------------------
                                             (AMOUNTS IN THOUSANDS)
                                 MATURITY                          MATURITY
                                 WITHIN 1   1 YEAR OR              WITHIN 1   1 YEAR OR
                        2002       YEAR        MORE       2003       YEAR        MORE
                      --------  ----------  ----------  ---------  ---------  ----------
<S>                   <C>       <C>         <C>         <C>        <C>        <C>
Municipal bonds       $119,798  $   99,180  $   20,618  $  89,010  $  59,271  $   29,739
Corporate securities    40,373      40,373           -     39,451     16,401      23,050
Commercial paper        23,909       7,304      16,605     69,998     69,998           -
                      --------  ----------  ----------  ---------  ---------  ----------
                      $184,080  $  146,857  $   37,223  $ 198,459  $ 145,670  $   52,789
                      ========  ==========  ==========  =========  =========  ==========
</TABLE>

5.   LONG-TERM  INVESTMENT  IN  PARTNERSHIPS

     The  Company formed long-term partnerships in two instances for the purpose
of acquiring and managing particular store sites, which were to be leased to the
Company.  No  such  arrangements  exist in any of the other store sites owned or
leased  by  the  Company,  and  the  Company  does  not anticipate entering into
partnerships  such  as  these  in  the  future  unless  the  circumstances  are
compelling.

The  Company  currently  accounts for these partnerships under the equity method
and  its  total  investment  is  approximately  $3  million.

The  Company  plans to consolidate the partnerships pursuant to the requirements
of  FIN No. 46 in future periods. The assets of the partnerships consist of real
estate  with  a  carrying  value  of  approximately  $3  million and there is no
mortgage  debt  or  other  significant liabilities associated with the entities,
other  than  a  note  payable  to  the  Company.  The  balance  sheet  effect of
consolidating  these  entities  will  be  a  $3  million  reclassification  from
investments  to property, plant and equipment and no corresponding impact on the
Company's  recorded  liabilities.


                                       33
<PAGE>
6.   PURCHASE OF DISTRIBUTION FACILITIES

       In  2003, the Company purchased two distributions centers. (i) On January
28,  2003  the  Company  completed  the  purchase  of  a  741,000  square  foot
distribution  center in Houston, to service its planned store expansion in Texas
in  2003  and  beyond.  The  facility was acquired for $23.0 million in cash and
contains  built  in  refrigerated and frozen storage space. (ii) On December 30,
2003,  the  Company completed the purchase of a 66,000 square foot deli & frozen
distribution  center in the City of Commerce. The facility was acquired for $8.4
million  in  cash.

7.   INCOME  TAX  PROVISION

     The provisions for income taxes for the three years ended December 31, 2003
are  as  follows:

<TABLE>
<CAPTION>
                             YEARS ENDED DECEMBER 31,
                            ---------------------------
                              (Amounts in thousands)
                             2001      2002      2003
                            -------  --------  --------
<S>                         <C>      <C>       <C>
Current:
 Federal. . . . . . . . . . $29,340   $32,237   $33,329
 State. . . . . . . . . . .   7,558     7,527     7,258
                            -------  --------  --------
                             36,898    39,764    40,587
Deferred federal and state.  (5,460)   (3,390)   (5,274)
                            -------  --------  --------
Provision for income tax. . $31,438   $36,374   $35,313
                            =======  ========  ========
</TABLE>

Differences  between  the  provisions  for  income taxes and income taxes at the
statutory  federal  income  tax rate for the three years ended December 31, 2003
are  as  follows:

<TABLE>
<CAPTION>
                                                                           YEAR ENDED DECEMBER 31,
                                                      ---------------------------------------------------------------
                                                                            (AMOUNTS IN THOUSANDS)
                                                             2001                     2002                2003
                                                      --------------------  ---------------------  ------------------
                                                       AMOUNT    PERCENT      AMOUNT     PERCENT    AMOUNT   PERCENT
                                                      --------  ----------  -----------  --------  --------  --------
<S>                                                   <C>       <C>         <C>          <C>       <C>       <C>
Income tax at statutory federal rate. . . . . . . . . $27,959        35.0%  $   33,372      35.0%  $32,145      35.0%

State income taxes, net of federal income tax effect.   4,258         5.3        5,206       5.5     4,656       5.1
Effect of permanent differences . . . . . . . . . . .    (404)       (0.5)        (631)     (0.7)     (418)     (0.5)
Other, including valuation allowance. . . . . . . . .       -           -       (1,200)     (1.2)     (812)     (0.8)
Welfare to work, LARZ and other job credits . . . . .    (375)       (0.4)        (373)     (0.4)     (258)     (0.3)
                                                      --------  ----------  -----------  --------  --------  --------
                                                      $31,438        39.4%  $   36,374      38.2%  $35,313      38.5
                                                      ========  ==========  ===========  ========  ========  ========
</TABLE>

A  detail  of  the Company's net deferred tax assets as of December 31, 2002 and
2003  is  as  follows:

<TABLE>
<CAPTION>
                                      YEAR ENDED DECEMBER 31,
                                   -------------  --------------
                                      (AMOUNTS IN THOUSANDS)
                                       2002            2003
                                   -------------  --------------
<S>                                <C>            <C>
Inventory                          $        617   $         732
Uniform inventory capitalization          3,042           3,120
Depreciation and amortization             6,633           7,804
Liability for accrued expenses              911             934
Workers' compensation                     3,353           6,984
Deferred rent                               959           1,053
State taxes                               2,688           2,197
Other, net                                 (314)           (609)
Net operating loss carry-forwards         7,755           7,329
                                   -------------  --------------
                                   $     25,644   $      29,544
Valuation allowance                      (3,900)         (3,900)
                                   -------------  --------------
                                   $     21,744   $      25,644
                                   =============  ==============
</TABLE>

     In  connection  with  the  acquisition and subsequent sale of Universal and
Odd's-N-End's,  the  Company  has  remaining  federal  net  operating  loss
carry-forwards  of approximately $20.9 million which it can use to offset future
taxable  income.  Future  use  of  these  loss carry-forwards may be limited and
expire  at  various dates through 2017. Due to the uncertainty of the future use
of  such  loss  carry-forwards,  the  Company has recorded a valuation allowance
equal  to  the tax effect of the loss carry-forward that may not be realizable.

8.   RELATED-PARTY TRANSACTIONS

     The  Company  leases  certain  retail  facilities  from  its  principal
shareholders.  Rental  expense  for  these  facilities  was  approximately  $1.9
million, $2.2 million, and $2.2 million in 2001, 2002 and 2003, respectively. In
addition,  one  of  the Company's outside directors is a trustee of a trust that
owns  a  property on which a single 99 Cents Only Store is located. Rent expense
on  this  store  amounted  to  $0.3  million  in  each  of  2001, 2002 and 2003.


                                       34
<PAGE>
     Effective  September 30, 2000, the Company sold its discontinued operation,
Universal  International,  Inc. to a company owned 100% by Dave and Sherry Gold,
both  significant  shareholders  of 99 Cents Only Stores (see Note 13). The sale
price  consisted  of  $33.9  million in cash and was collected at closing. These
proceeds  were  invested  in the Company's investment accounts. Mr. Gold is also
CEO  and  Chairman  of  99  Cents  Only  Stores.  In connection with this sale a
management  services  and lease agreement was entered into between Universal and
the  Company.  The  service agreement provided for the Company to render certain
administrative  services to Universal, including information technology support,
accounting,  buying  and human resource functions. The Company charged Universal
management  fees  for  these services. The lease agreement involved the property
that  served  as  Universal's  primary  warehouse and distribution facility. The
lease  was  structured on a triple net basis and provided for rental payments of
$120,000  per  month.  Resolution  of  Universal  post  closing  business issues
required  the  extension  of the service agreement and lease arrangement with 99
Cents  Only  Stores  to  December  2003.

     The  following  is  a  summary  of the transactions between the Company and
Universal  for  2001,  2002 and 2003 and a reconciliation of amounts due to/from
shareholder  resulting  from  such  transactions  (amounts  in  thousands):

<TABLE>
<CAPTION>
                                                                                         BALANCE (TO) FROM
      MANAGEMENT   RENTAL   INVENTORY SALES TO   INVENTORY PURCHASES FROM    PAYMENTS    SHAREHOLDER END OF
YEAR     FEES      INCOME        UNIVERSAL               UNIVERSAL           RECEIVED          PERIOD
<S>   <C>          <C>      <C>                  <C>                        <C>         <C>
2001  $     3,695  $ 1,440  $             4,693                         -    ($11,483)              ($1,655)
2002  $     1,500  $ 1,440                    -                     ($460)  $     407   $             1,232
2003  $     1,440  $ 1,380                    -                         -     ($4,052)                    -
</TABLE>

9.   COMMITMENTS AND CONTINGENCIES

CREDIT  FACILITY

     The  Company  does  not  maintain  any  credit  facilities  with any bank.

LEASE  COMMITMENTS

     The  Company  leases  various  facilities under operating leases except for
two,  which were classified as capital leases, expiring at various dates through
2017.  Some  of  the lease agreements contain renewal options and/or provide for
scheduled  increases  or  increases  based  on  the  Consumer Price Index. Total
minimum lease payments under each of these lease agreements, including scheduled
increases,  are  charged to operations on a straight-line basis over the life of
each  respective  lease.  Certain  leases require the payment of property taxes,
maintenance  and  insurance.  Rental expense charged to operations in 2000, 2001
and  2002  was  approximately  $15.6  million,  $19.4 million and $24.9 million,
respectively.  As of December 31, 2003, the minimum annual rentals payable under
all  non-cancelable  operating  leases were as follows: (Amounts in thousands):

<TABLE>
<CAPTION>
                YEAR ENDING DECEMBER 31:          OPERATING LEASES    CAPITAL LEASES
          --------------------------------------  -----------------  ----------------
<S>                                               <C>                <C>
          2004. . . . . . . . . . . . . . . . . . $          26,834  $           169
          2005. . . . . . . . . . . . . . . . . .            24,523              169
          2006. . . . . . . . . . . . . . . . . .            21,651              192
          2007. . . . . . . . . . . . . . . . . .            17,792              199
          2008. . . . . . . . . . . . . . . . . .            16,616              199
          Thereafter. . . . . . . . . . . . . . .            46,362            1,623
                                                  -----------------  ----------------
          Future minimum lease payments . . . . . $         153,778  $         2,551
                                                  =================
          Less amount representing interest . . .                               (958)
                                                                     ----------------
          Present value of future lease payments.                    $         1,593
                                                                     ================
</TABLE>

WORKERS'  COMPENSATION

     Effective  August  11, 1993, the Company became self-insured as to workers'
compensation  claims.  The  Company  provides  for losses of estimated known and
incurred  but  not  reported  insurance  claims.  Known claims are estimated and
accrued  when  reported.  At December 31, 2002 and 2003, the Company had accrued
approximately  $7.7  million  and  $16.3  million,  respectively,  for estimated
workers'  compensation  claims. The Company recorded an adjustment in the fourth
quarter  of  2003  in  the amount of $7.9 million to adjust its accrued workers'
compensation  liability  to  the  amount determined by its most recent actuarial
study.

LEGAL  MATTERS

GILLETTE  COMPANY  LAWSUIT:

     A  lawsuit  is  pending, filed by the Gillette Company against the Company,
arising  out  of  a  dispute  over  the interpretation of a contract between the
parties.  Gillette,  which  is  suing  for  breach of contract, alleges that the
Company  owes Gillette an additional principal sum of approximately $2.1 million
(apart  from  the approximately $1 million already paid to Gillette), plus fees,
costs  and  interest.  Also  pending is a cross-complaint by the Company against
Gillette, alleging breach of contract, fraud and unfair business acts.  Trial is
anticipated  to  commence  in  late  March,  2004  or  early  April,  2004.


                                       35
<PAGE>
MELGOZA  LAWSUIT:

     On  May  7,  2003,  the plaintiff, a former Store Manager, filed a putative
class  action  on  behalf  of  himself  and  others similarly situated. The suit
alleges  that  the Company improperly classified Store Managers in the Company's
California stores as exempt from overtime requirements as well as meals and rest
period  requirements  under  California  law. Each store typically has one Store
Manager  and  two  or three Assistant Store Managers. Pursuant to the California
Labor  Code,  the  suit seeks to recover unpaid overtime compensation, penalties
for  failure to provide meal and rest periods, waiting time penalties for former
employees,  interest,  attorney fees, and costs. The suit also charges, pursuant
to  California's  Business  and Professions Code section 17200, that the Company
engaged in unfair business practices by failing to make such payments, and seeks
payment  of all such wages (in the form of restitution) for the four-year period
preceding  the  filing of the case through the present. Plaintiff is now seeking
leave  to  file  an amended complaint that would (1) expand the class to include
not  only  all current and former Store Managers who worked for the Company from
May  7,  1999  but also all current and former Assistant Managers who worked for
the  Company  during the same period; and (2) claims for additional penalties on
behalf  of all purported class members under California's new Labor Code Private
Attorney  General  Act  of 2004. The Company is vigorously asserting defenses to
the  various  claims.

     In  view  of  the  inherent  difficulty  of predicting the outcome of legal
matters,  the  Company cannot state with confidence what the eventual outcome of
this  matter  will  be.  However, based on current knowledge, this matter is not
presently  expected to have a material adverse effect on the Company's financial
condition or overall liquidity, although it could have a material adverse effect
on  the Company's results of operations for the accounting period in which it is
resolved.

OTHERS:

     The  Company is named as a defendant in various other legal matters arising
in  the  normal course of business. In management's opinion, none of these other
matters will have a material effect on the Company's financial position, results
of  operations  or  overall  liquidity.

10.  STOCK-BASED COMPENSATION PLANS

     The  Company  has  one  stock  option  plan (the 1996 Stock Option Plan, as
amended).  The  plan  is  a  fixed  plan,  which  provides  for  the granting of
non-qualified  and  incentive  options  to  purchase  up to 17,000,000 shares of
common  stock of which 5,268,045 are available for future option grants. Options
may  be granted to officers, employees, directors and consultants. Grants may be
at  fair  market  value  at  the  date  of grant or at a price determined by the
compensation  committee  consisting  of  four  outside  members  of the board of
directors  (the  "Committee").  Options vest over a three-year period, one-third
one  year  from  the  date  of  grant and one third per year thereafter. Options
expire  ten  years  from  the date of grant.  The Company accounts for its stock
option  plan  under  Accounting  Principles  Bulletin  Opinion No. 25 ("APB 25")
"Accounting  for Stock Issued to Employees" under which no compensation cost has
been  recognized  in  fiscal 2001, 2002 and 2003. The following table summarizes
stock  options  available  for  grant:

<TABLE>
<CAPTION>
                                       YEAR ENDED DECEMBER 31,
                            -------------------------------------------

                                  2001             2002         2003
                            -----------------  -----------  -----------
<S>                         <C>                <C>          <C>
Beginning balance. . . . . .       3,478,532    2,463,061    6,199,566
Authorized . . . . . . . . .               -    4,665,633            -
Granted. . . . . . . . . . .      (1,178,491)  (1,030,521)  (1,074,579)
Cancelled. . . . . . . . . .         163,020      101,393      143,058
                            -----------------  -----------  -----------
Available for future grant .       2,463,061    6,199,566    5,268,045
                            =================  ===========  ===========
</TABLE>


                                       36
<PAGE>
A summary of the status of the Company's stock option plan at December 31, 2001,
2002  and 2003 and changes during the years then ended is presented in the table
and  narrative  below:

<TABLE>
<CAPTION>
                                                                       YEAR ENDED DECEMBER 31,
                                                --------------------------------------------------------------------

                                                          2001                   2002                    2003
                                                ----------------------  ---------------------  ---------------------
                                                             WGHT AVG               WGHT AVG                WGHT AVG
                                                  SHARES     EX PRICE     SHARES    EX PRICE     SHARES     EX PRICE
                                                -----------  ---------  ----------  ---------  -----------  --------
<S>                                             <C>          <C>        <C>         <C>        <C>          <C>
Outstanding at the beginning of the year . . .   5,277,176   $   13.06  5,194,729   $   15.00   5,260,782      17.86
Granted. . . . . . . . . . . . . . . . . . . .   1,178,491       20.40  1,030,521       29.60   1,074,579      29.37
Exercised. . . . . . . . . . . . . . . . . . .  (1,097,918)      10.89   (863,075)      14.50  (1,763,631)     15.47
Cancelled. . . . . . . . . . . . . . . . . . .    (163,020)      18.88   (101,393)      19.87    (143,058)     26.20
Outstanding at the end of the year . . . . . .   5,194,729       15.00  5,260,782       17.86   4,428,672      21.12
Exercisable at the end of the year . . . . . .   2,587,947       11.36  3,046,933       13.44   2,467,004      15.68
Weighted average fair value of options granted
                                                             $   13.80              $   17.86                  21.12
</TABLE>

The  following  table  summarized information about stock options outstanding at
December  31,  2003:

<TABLE>
<CAPTION>
                                   WEIGHTED      WEIGHTED                WEIGHTED
                                   AVERAGE        AVERAGE                 AVERAGE
RANGE OF            OPTIONS       REMAINING      EXERCISE     OPTIONS    EXERCISE
EXERCISE PRICES   OUTSTANDING  CONTRACTUAL LIFE    PRICE    EXERCISABLE    PRICE
----------------  -----------  ----------------  ---------  -----------  ---------
<S>               <C>          <C>               <C>        <C>          <C>
  2.64 - $5.50        498,457               2.9  $    4.14      498,509  $    4.14
  5.51 - $8.70          1,635               3.6  $    6.82        1,635  $    6.82
  8.71 - 15.75        322,949               4.3  $   11.38      318,483  $   11.36
15.76 - $22.50      1,707,021               6.3  $   18.61    1,384,369  $   18.17
 22.51 - 35.00      1,898,610               8.9  $   29.50      264,008  $   29.66
                  -----------  ----------------  ---------  -----------  ---------
                    4,428,672               6.9  $   21.12    2,467,004  $   15.68
                  ===========  ================  =========  ===========  =========
</TABLE>

11.  OPERATING SEGMENTS

     The  Company  has  two  business  segments, retail operations and wholesale
distribution.  The  majority  of  the  product  offerings  include  recognized
brand-name  consumable  merchandise,  regularly  available  for reorder. Bargain
Wholesale  sells the same merchandise at prices generally below normal wholesale
levels  to  local,  regional  and  national  distributors  and  exporters.

     The  accounting  policies  of  the segments are the same as those described
above  in  the summary of significant accounting policies. The Company evaluates
segment  performance  based  on  the net sales and gross profit of each segment.
Management  does  not  track  segment  data  or  evaluate segment performance on
additional  financial information. As such, there are no separately identifiable
segment assets or separately identifiable statements of income data (below gross
profit)  to  be  disclosed.  The Company accounts for inter-segment transfers at
cost  through  its  inventory  accounts.

     The  Company  had  no  customers  representing  more than 10 percent of net
sales. Substantially all of the Company's net sales were to customers located in
the  United  States. Reportable segment information for the years ended December
31,  2001,  2002  and  2003  follows  (amounts  in  thousands):

<TABLE>
<CAPTION>
                         RETAIL   WHOLESALE    TOTAL
                        --------  ----------  --------
<S>                     <C>       <C>         <C>

          2001
          ----
          Net sales. .  $522,019  $   56,250  $578,269
          Gross Margin   217,015      10,833   227,848

          2002
          ----
          Net sales. .  $663,983  $   49,959  $713,942
          Gross Margin   276,560      10,026   286,586

          2003
          ----
          Net sales. .  $816,348  $   46,112  $862,460
          Gross Margin   478,943      36,980   515,923
</TABLE>


                                       37
<PAGE>
12.  401(K) PLAN

     In  1998  the  Company  adopted  a  401(k)  Plan  (the Plan). All full-time
employees are eligible to participate in the plan after 3 months of service. The
Company  does  not match employee contributions. The Company may elect to make a
discretionary  contribution  to the Plan. For the years ended December 31, 2001,
2002  and  2003,  no  discretionary  contributions  were  made.

13.  DISCONTINUED OPERATIONS

     On  March  4,  2000,  the  Board  of  Directors approved the disposition of
Universal  International,  Inc.  and  Odd's-n-End's,  Inc.,  which comprises the
retail  operations  of  Odds-n-Ends,  Inc.  and  Only  Deals,  Inc.

     The  Company  engaged  an investment-banking firm in April 2000 to evaluate
and  identify  potential  buyers for the Universal business and expected to sell
Universal  within  the  one-year  time  frame  from  when the Company classified
Universal  as  a  discontinued business. The investment banking firm's marketing
process  focused upon selling the business as a going concern. During the summer
of  2000,  sales  presentations  were  delivered  to  both  strategic buyers and
financial buyers. This process did not generate the expected interest level from
potential  buyers that had been anticipated. The highest offer for the Universal
business  was significantly less than the Company's expectations. As a result of
the  difficulties  encountered  in trying to sell Universal and the necessity to
complete  the  process  by  December  31,  2000  it  was decided by the Board of
Directors  to  be  in  the Company's and the shareholders' best interest to sell
Universal  for  the  Company's  carrying  value  as  of the close of business on
September  30,  2000 to Universal Deals, Inc., a limited liability company owned
100%  by  David  and Sherry Gold, both significant shareholders of 99 Cents Only
Stores.  Mr.  Gold  is  also Chairman and CEO of 99 Cents Only Stores. The sales
price for Universal was the Company's carrying value as of the close of business
on  September 30, 2000, which was $33.9 million. The net assets at September 30,
2000  included  $29.2 million in inventory, net fixed assets of $7.6 million and
$0.6  million  of  other  assets.  These  assets  were offset by $3.5 million of
accounts  payable,  accrued  and  other  liabilities.  In  connection  with this
transaction 99 Cents Only Stores has provided certain ongoing administrative and
other  services  to  Universal  pursuant  to  a  services  agreement  and  other
arrangements.  See  note 8 for a summary of transactions between the Company and
Universal for the years ended December 31, 2001, 2002 and 2003.

14.  STOCK SPLIT

     On  March  9,  2002,  the  Company's  Board  of  Directors  approved  a
four-for-three  stock  split  distributed  on  April  3, 2002 to shareholders of
record  on  March  25,  2002.  Also on February 17, 2001, the Company's Board of
Directors  approved a three-for-two stock split distributed on March 20, 2001 to
shareholders  of  record  on May 14, 2001. All share and per share data has been
restated  to  reflect  these  stock  splits.

ITEM  9.  CHANGES  IN  AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING AND
FINANCIAL  DISCLOSURE

     As  of June 13, 2002, upon the recommendation of the Audit Committee of the
Company,  the  Board  of Directors dismissed Arthur Andersen LLP ("Andersen") as
the  Company's independent auditors. Arthur Andersen had served as the Company's
independent  auditors  since  1989.

     Andersen's  reports on the consolidated financial statements of the Company
and  its  subsidiaries for the two most recent years ended December 31, 2001 did
not  contain any adverse opinion or disclaimer of opinion, nor were such reports
qualified  or  modified as to uncertainty, audit scope or accounting principles.
During  the  Company's  two most recent fiscal years ended December 31, 2001 and
the  subsequent  interim  period  through  June  13,  2002,  there  were: (i) no
disagreements  between  the  Company  and  Andersen on any matters of accounting
principles  or  practices,  financial statement disclosure, or auditing scope or
procedure  which,  if not resolved to Andersen's satisfaction, would have caused
them  to  make reference to the subject matter of the disagreement in connection
with  their  reports on the Company's consolidated financial statements for such
years;  and  (ii)  no  "reportable events" as defined in item 304 (a) (1) (v) of
Regulation  S-K.  The  Company  provided  Andersen  with a copy of the foregoing
disclosures,  and  Andersen  delivered a letter to the SEC, dated June 13, 2002,
stating  its  agreement  with  such  statements.

     On June 13, 2002, the Company engaged PricewaterhouseCoopers LLP ("PwC") as
its  independent  auditors to audit its financial statements for the year ending
December  31,  2002. The decision to engage PwC was recommended by the Company's
Audit Committee and approved by its Board of Directors. During the Company's two
most  recent years ended December 31, 2001 and subsequent interim period through
June  13,  2002,  the  Company  did  not  consult  with  PwC with respect to the
application  of  accounting  principles  to  a  specified  transaction,  either
completed  or  proposed,  or the type of audit opinion that might be rendered on
the  Company's  consolidated  financial  statements  or  any  other  matters  or
reportable  events  as set forth in Items 304 (a) (2) (i) and (ii) of Regulation
S-K.


                                       38
<PAGE>
ITEM 9A. CONTROLS AND PROCEDURES

EVALUATION  OF  DISCLOSURE  CONTROLS  AND  PROCEDURES

     We  carried  out  an  evaluation  under  the  supervision  and  with  the
participation  of  our management, including our Chief Executive Officer ("CEO")
and  Chief  Financial  Officer  ("CFO"),  of the effectiveness of the design and
operation  of  our disclosure controls and procedures ("Disclosure Controls") as
of  December  31, 2003 pursuant to Rule 13a-15 of the Securities Exchange Act of
1934. Based upon that evaluation, our CEO and our CFO concluded that, subject to
the  limitations  noted  below,  our  Disclosure  Controls  and  procedures  are
effective  in  timely  alerting  them  to  material  information  required to be
included  in  our  periodic  SEC  filings.

CHANGES  IN  INTERNAL  CONTROLS  AND  PROCEDURES

     There  were  no  changes  in  our internal control over financial reporting
during our fourth quarter that have materially affected or are reasonably likely
to  materially  affect  our  internal  control  over  financial  reporting.

LIMITATIONS  ON  THE  EFFECTIVENESS  OF  CONTROLS

     Our  management,  including  our  CEO  and  CFO,  does  not expect that our
disclosure  controls  and internal control over financial reporting will prevent
all  error  and  fraud.  A  control  system,  no  matter  how well conceived and
operated,  can  provide  only  reasonable,  not  absolute,  assurance  that  the
objectives  of  the  control system can be met. Further, the design of a control
system  must  reflect  the  fact  that  there  are resource constraints, and the
benefits  of controls must be considered relative to their costs. Because of the
inherent  limitations  in  all  control  systems,  no evaluation of controls can
provide  absolute  assurance  that all control issues and instances of fraud, if
any,  within  the Company have been detected. These inherent limitations include
the  realities  that  judgements  in  decision-making  can  be  faulty, and that
breakdowns  can occur because of simple error or mistake. Additionally, controls
can  be circumvented by the individual acts of some persons, by collusion of two
or  more  people,  or  by  management  override  of  the  control.

                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     Information  regarding  Directors  and Executive Officers of the registrant
required  by  Item 401 of Regulation S-K and information regarding Directors and
Executive  Officers  of the registrant required by Item 405 of Regulation S-K is
presented  under  the  captions  "Election of Directors," "Management," "Code of
Ethics,"  "Nominations,"  and  "Section  16(a)  Beneficial  Ownership  Reporting
Compliance"  in  the  definitive  Proxy  Statement for the Company's 2004 Annual
Meeting  of  Shareholders,  and  is  incorporated  herein  by  reference.

ITEM 11.  EXECUTIVE COMPENSATION

     The  information  required by Item 402 of Regulation S-K is presented under
the  caption  "Executive Compensation" in the definitive Proxy Statement for the
Company's  2004  Annual  Meeting  of Shareholders, and is incorporated herein by
reference.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The  information  required by Item 403 of Regulation S-K is presented under
the captions "Principal Shareholders" and "Equity Compensation Plan Information"
in  the  definitive  Proxy  Statement  for  the Company's 2004 Annual Meeting of
Shareholders,  and  is  incorporated  herein  by  reference.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The  information  required by Item 404 of Regulation S-K is presented under
the  caption  "Certain  Relationships" in the definitive Proxy Statement for the
Company's  2004  Annual  Meeting  of Shareholders, and is incorporated herein by
reference.

ITEM  14.  PRINCIPAL  ACCOUNTANT  FEES  AND  SERVICES

     The  information  required  by Item 9(a) of Schedule 14A is presented under
the  caption  "Independent Public Accountants" in the definitive Proxy Statement
for  the  Company's  2004  Annual  Meeting  of Shareholders, and is incorporated
herein  by  reference.


                                       39
<PAGE>
                                     PART IV

ITEM 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

1.   Financial  Statements.  Reference  is  made  to  the Index to the Financial
     Statements  set  forth  in  item  8  on  page  21  of  this  Form  10-K.

2.   Financial Statement Schedules. All Schedules for which provision is made in
     the  applicable  accounting  regulations  of  the  Securities  and Exchange
     Commission  are  included  herein.

3.   The Exhibits listed on the accompanying Index to Exhibits are filed as part
     of,  or  incorporated  by  reference  into,  this  report.

4    Reports  on  Form 8-K. The Company furnished two reports on form 8-K during
     the  fourth  quarter  of  2003.  One,  reporting  Item  12 information, was
     furnished  on  October  9,  2003  and  the  second,  also reporting Item 12
     information,  was furnished on October 21, 2003. An amendment to the second
     8-K  was  furnished  on  October  24,  2003.


                                       40
<PAGE>
SIGNATURES

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

Dated:   March 12, 2004                  99 Cents Only Stores


                                         /s/  Eric Schiffer
                                         ----------------------------
                                         By:  Eric Schiffer
                                         President

     Pursuant  to  the  requirements of the Securities Exchange Act of 1934 this
Annual  Report  on  Form  10K  has been signed below by the following persons on
behalf  of  the  Registrant  and  in  the capacities and on the dates indicated.

<TABLE>
<CAPTION>
SIGNATURE                                  TITLE                           DATE
<S>                    <C>                                            <C>

/s/ David Gold
---------------------
David Gold             Chairman of the Board and Chief Executive      March 12, 2004
                       Officer

/s/ Howard Gold                                                       March 12, 2004
---------------------
Howard Gold            Senior Vice President of Distribution and
                       Director

/s/ Jeff Gold
---------------------
Jeff Gold              Senior Vice President of Real Estate and       March 12, 2004
                       Information Systems and Director

/s/ Eric Schiffer
---------------------
Eric Schiffer          President and Director                         March 12, 2004

/s/ Andrew Farina
---------------------
Andrew Farina          Chief Financial Officer (Principal financial   March 12, 2004
                       officer and principal accounting officer)

/s/ William Christy
---------------------
William Christy        Director                                       March 12, 2004

/s/ Lawrence Glascott
---------------------
Lawrence Glascott      Director                                       March 12, 2004

/s/ Marvin L. Holen
---------------------
Marvin L. Holen        Director                                       March 12, 2004

/s/ Ben Schwartz
---------------------
Ben Schwartz           Director                                       March 12, 2004

/s/ John Shields
---------------------
John Shields           Director                                       March 12, 2004
</TABLE>


                                       41
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
PART I. FINANCIAL STATEMENT SCHEDULE

To the Board of Directors Of 99 Cents Only Stores:

Our  audits  of  the consolidated financial statements referred to in our report
dated  February  27, 2004 appearing in the 2003 Annual Report to Shareholders of
99  Cents Only Stores also included an audit of the financial statement schedule
listed  in  Item  15(a)(2)  of  this  Form  10-K. In our opinion, this financial
statement  schedule  presents  fairly, in all material respects, the information
set  forth  therein  when  read  in  conjunction  with  the related consolidated
financial  statements.

PricewaterhouseCoopers LLP
Los Angeles, CA
February 27, 2004


<PAGE>
<TABLE>
<CAPTION>
                                        99 CENTS ONLY STORES
                           SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                  FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED DECEMBER 31, 2003

                                       (AMOUNTS IN THOUSANDS)



                                       BEGINNING OF YEAR   ADDITION  REDUCTION   OTHER  END OF YEAR
                                       ------------------  --------  ----------  -----  ------------
<S>                                    <C>                 <C>       <C>         <C>    <C>
For the year ended December 31, 2003
  Allowance for doubtful accounts      $              149         -  $        6      -  $        143
  Inventory reserve                    $            1,522       189           -      -  $      1,711
For the year ended December 31, 2002
  Allowance for doubtful accounts      $              165         -          16      -  $        149
  Inventory reserve                    $            1,224       298           -      -  $      1,522
For the year ended December 31, 2001:
  Allowance for doubtful accounts      $              113       177         125      -  $        165
 Inventory reserve                     $            1,279       179         234      -  $      1,224
</TABLE>


<PAGE>
Exhibit Index

Exhibit Description

3.1     Amended and Restated Articles of Incorporation of the Registrant.(2)

3.2     Amended and Restated Bylaws of the Registrant.(1)

4.1     Specimen certificate evidencing Common Stock of the Registrant.(1)

10.1    Form of Indemnification Agreement and Schedule of Indemnified
        Parties.(1)

10.2    [Reserved]

10.3    Form of Tax Indemnification Agreement, between and among the
        Registrant and the Existing Shareholders.(1)

10.4    1996 Stock Option Plan.(1)

10.5    Lease for 730 West Foothill Boulevard, Azusa, California, dated as of
        December 1, 1995, by and between the Registrant as Tenant and HKJ Gold,
        Inc. as Landlord, as amended(1).

10.6    Lease for 13023 Hawthorne Boulevard, Hawthorne, California, dated April
        1 1994, by and between the Registrant as Tenant and HKJ Gold, Inc. as
        Landlord, as amended.(1)

10.7    Lease for 6161 Atlantic Boulevard, Maywood, California, dated November
        11, 1985, by and between the Registrant as Lessee and David and Sherry
        Gold, among others, as Lessors.(1)

10.8    Lease for 14139 Paramount Boulevard, Paramount, California, dated as of
        March 1 1996, by and between the Registrant as Tenant and 14139
        Paramount Properties as Landlord, as amended.(1)

10.9    Release Agreement, dated March 25, 1996, regarding 11382 Beach
        Boulevard, Stanton, California, by and between the Registrant and 11382
        Beach Partnership.(1)

10.10   Lease for 6124 Pacific Boulevard, Huntington Park, California, dated
        January 31, 1991, by and between the Registrant as Tenant and David and
        Sherry Gold as the Landlord, as amended.(1)

10.11   Lease for 14901 Hawthorne Boulevard, Lawndale, California, dated
        November 1, 1991, by and between Howard Gold, Karen Schiffer and Jeff
        Gold, dba 14901 Hawthorne Boulevard Partnership as Landlord and the
        Registrant as Tenant, as amended.(1)

10.12   Lease for 5599 Atlantic Avenue, North Long Beach, California, dated
        August 13, 1992, by and between the Registrant as Tenant and HKJ Gold,
        Inc. as Landlord, as amended.(1)

10.13   Lease for 1514 North Main Street, Santa Ana, California, dated as of
        November 12, 1993, by and between the Registrant as Tenant and Howard
        Gold, Jeff Gold, Eric J. Schiffer and Karen R. Schiffer as Landlord, as
        amended.(1)


<PAGE>
10.14   Lease for 6121 Wilshire Boulevard, Los Angeles, California, dated as of
        July 1, 1993, by and between the Registrant as Tenant and HKJ Gold, Inc.
        as Landlord, as amended; and lease for 6101 Wilshire Boulevard, Los
        Angeles, California, dated as of December 1, 1995, by and between the
        Registrant as Tenant and David and Sherry Gold as Landlord, as
        amended.(1)

10.15   Lease for 8625 Woodman Avenue, Arleta, California, dated as of July 8,
        1993, by and between the Registrant as Tenant and David and Sherry Gold
        as Landlord, as amended.(1)

10.16   Lease for 2566 East Florence Avenue, Walnut Park, California, dated as
        of April 18, 1994, by and between HKJ Gold, Inc. as Landlord and the
        Registrant as Tenant, as amended.(1)

10.17   Lease for 3420 West Lincoln Avenue, Anaheim, California, dated as of
        March 1, 1996, by and between the Registrant as Tenant and HKJ Gold,
        Inc. as Landlord, as amended.(1)

10.18   Master Lease for 4000 East Union Pacific Avenue, City of Commerce,
        California ("Warehouse and Distribution Facility Lease"), dated as of
        December 20, 1993, by and between the Registrant as Lessee and TBC
        Realty II Corporation ("TBC") as Lessor, together with Lease Guaranty
        ("Lease Guaranty"), dated December 20, 1993, by and between Sherry and
        David Gold and TBC with respect thereto and Letter Agreement, dated
        December 15, 1993, among Registrant, The Mead Corporation, TBC and
        Citicorp Leasing, Inc. with respect to the Lease Guaranty.(1)

10.19   Hawaiian Gardens Indemnity Agreement, dated as of March 25, 1996, by and
        between the Registrant and HKJ Gold, Inc.(1)

10.20   North Broadway Indemnity Agreement, dated as of May 1, 1996, by and
        between HKJ Gold, Inc. and the Registrant.(1)

10.21   Lease for 2606 North Broadway, Los Angeles, California, dated as of May
        1, 1996, by and between HKJ Gold, Inc. as Landlord and the Registrant as
        Tenant.(1)

10.22   Grant Deed concerning 8625 Woodman Avenue, Arleta, California, dated May
        2, 1996, made by David Gold and Sherry Gold in favor of Au Zone
        Investments #2, L.P., a California limited partnership.(1)

10.23   Grant Deed concerning 6101 Wilshire Boulevard, Los Angeles, California,
        dated May 2, 1996, made by David Gold and Sherry Gold in favor of Au
        Zone Investments #2, L.P., a California limited partnership.(1)

10.24   Grant Deed concerning 6124 Pacific Boulevard, Huntington Park,
        California, dated May 2, 1996, made by David Gold and Sherry Gold in
        favor of Au Zone Investments #2, L.P., a California limited
        partnership.(1)

10.25   Grant Deed concerning 14901 Hawthorne Boulevard, Lawndale, California,
        dated May 2, 1996, made by Howard Gold, Karen Schiffer and Jeff Gold in
        favor of Au Zone Investments #2, L.P., a California limited
        partnership.(1)


<PAGE>
10.26   Services Agreement, dated as of December 28, 2000, by and between
        Universal International, Inc. and the registrant.(3)

10.27   Lease for 955 West Sepulveda, Los Angeles, California, dated as of
        July 17, 1995, by and between Schwartz Investment Co., as successor to
        VAT Partners II, as Landlord and the Company as Tenant.(2)

23.1    Consent of PriceWaterhouseCoopers LLP.*

31(a)   Certification of Chief Executive Officer pursuant to Section 302 of
        the Sarbanes-Oxley Act of 2002.*

31(b)   Certification of Chief Financial Officer pursuant to Section 302 of
        the Sarbanes-Oxley Act of 2002.*

32(a)   Certification of Chief Executive Officer pursuant to section 906 of
        the Sarbanes-Oxley Act of 2002.*

32(b)   Certification of Chief Financial Officer pursuant to section 906 of
        the Sarbanes-Oxley Act of 2002.*




* Filed herewith

(1) Incorporated by reference from the Company's Registration Statement on
    Form S-1 as filed with the Securities and Exchange Commission on May 21,
    1996.

(2) Incorporated by reference from the Company's 2002 Annual Report on Form 10-K
    as filed with the Securities and Exchange Commission on March 31, 2003.

(3) Incorporated by reference from the Company's Current Report on Form 8-K as
    filed with the Securities and Exchange Commission on January 12, 2001.




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