Exhibit No. 10.2

INDEMNIFICATION
AGREEMENT

AGREEMENT, effective as of December
18, 2003, between United Retail Group, Inc., a Delaware corporation (the
Company), and the undersigned (Indemnitee).

WHEREAS, it is essential to the
Company to retain as directors the most capable persons available;

WHEREAS, Indemnitee is currently
serving as a director of the Company;

WHEREAS, both the Company and
Indemnitee recognize the increased risk of litigation and other claims being asserted
against directors of public companies in todays environment;

WHEREAS, basic protection against
undue risk of personal liability of directors heretofore has been provided through
insurance coverage providing reasonable protection at reasonable cost, and Indemnitee has
relied on the availability of such coverage; but as a result of substantial changes in the
marketplace for such insurance it has become increasingly more difficult to obtain such
insurance on terms providing reasonable protection at reasonable cost;

WHEREAS, the By-laws of the Company
require the Company to indemnify and advance expenses to its directors to the full extent
permitted by law and Indemnitee has been serving and continues to serve as a director of
the Company in part in reliance on such By-laws;

WHEREAS, in recognition of
Indemnitees need for substantial protection against personal liability in order to
enhance Indemnitees continued service to the Company in an effective manner, the
increasing difficulty in obtaining satisfactory director liability insurance coverage, and
Indemnitees reliance on the aforesaid By-laws, and in part to provide Indemnitee
with specific contractual assurance that the protection promised by such By-laws will be
available to Indemnitee (regardless of, among other things, any amendment to or revocation
of such By-laws or any change in the composition of the Companys Board of Directors
or acquisition transaction relating to the Company), the Company wishes to provide in this
Agreement for the indemnification of and the advancing of expenses to Indemnitee to the
fullest extent (whether partial or complete) permitted by law and as set forth in this
Agreement, and, to the extent insurance is maintained, for the continued coverage of
Indemnitee under the Companys directors liability insurance policies; and

WHEREAS, this Agreement was approved
by the Companys Board of Directors on December 5, 2003;

NOW, THEREFORE, in consideration of
the premises and of Indemnitee continuing to serve the Company and intending to be legally
bound hereby, the parties hereto agree as follows:

| | 1. | Certain Definitions:
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| | (a) | Change in Control: shall be deemed to have occurred if (i) any
               person (as such term is used in Sections 13(d) and 14(d) of the
               Securities Exchange Act of 1934, as amended), becomes an Acquiring
               Person (as such term is defined in the Rights Agreement dated as of
               September 14, 1999 by and between the Company and Continental Stock Transfer
               & Trust Company, as in effect on the date hereof (the Rights
               Agreement)) or (ii) during any period of two consecutive years,
               individuals who at the beginning of such period constitute the Board of
               Directors of the Company and any new director whose election by the Board of
               Directors or nomination for election by the Companys stockholders was
               approved by a vote of at least two-thirds (2/3) of the directors then still in
               office who either were directors at the beginning of the period or whose
               election or nomination for election was previously so approved, cease for any
               reason to constitute a majority thereof, or (iii) the Company consummates any of
               the transactions set forth in clauses (x), (y) or (z) in Section 13(a) of the
               Rights Agreement.
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| | (b) | Claim: any threatened, pending or completed action, suit or proceeding,
               or any inquiry or investigation, whether instituted by the Company or any other
               party, that Indemnitee in good faith believes might lead to the institution of
               any such action, suit or proceeding, whether civil, criminal, administrative,
               investigative or other.
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| | (c) | Expenses: include attorneys fees and all other costs, expenses and
               obligations paid or incurred in connection with investigating, defending, being
               a witness in or participating in (including on appeal), or preparing to defend,
               be a witness in or participate in, any Claim relating to any Indemnifiable
               Event.
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| | (d) | Indemnifiable Event: any event or occurrence related to the fact that
               Indemnitee is or was a director or by reason of anything done or not done by
               Indemnitee in such capacity.
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| | (e) | Independent Legal Counsel: an attorney or firm of attorneys, selected in
               accordance with the provisions of Section 3, who shall not have otherwise
               performed services for the Company or Indemnitee within the last five years
               (other than with respect to matters concerning the rights of Indemnitee under
               this Agreement, or of other indemnitees under similar indemnity agreements).
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| | (f) | Reviewing Party: any appropriate person or body consisting of a member or
               members of the Companys Board of Directors or any other person or body
               appointed by the Board who is not a party to the particular Claim for which
               Indemnitee is seeking indemnification, or Independent Legal Counsel.
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| | 2. | Basic Indemnification Arrangement.
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(a)       
          In the event Indemnitee was, is or becomes a party to or witness or other
          participant in, or is threatened to be made a party to or witness or other
          participant in, a Claim by reason of (or arising in part out of) an
          Indemnifiable Event, the Company shall indemnify Indemnitee to the fullest
          extent permitted by law as soon as practicable but in any event no later than
          thirty days after written demand is presented to the Company, against any and
          all Expenses, judgments, fines, penalties and amounts paid in settlement
          (including all interest, assessments and other charges paid or payable in
          connection with or in respect of such Expenses, judgments, fines, penalties or
          amounts paid in settlement) of such Claim. If so requested by Indemnitee, the
          Company shall to the fullest extent permitted by law advance (within two
          business days of such request) any and all Expenses to Indemnitee (an
          Expense Advance). Notwithstanding anything in this Agreement to the
          contrary, prior to a Change in Control Indemnitee shall not be entitled to
          indemnification pursuant to this Agreement in connection with any Claim
          initiated by Indemnitee unless the Board of Directors has authorized or
          consented to the initiation of such Claim.

(b)       
          Notwithstanding the foregoing, (i) the obligations of the Company under Section
          2(a) shall be subject to the condition that the Reviewing Party shall not have
          determined (in a written opinion, in any case in which the Independent Legal
          Counsel referred to in Section 3 hereof is involved) that Indemnitee would not
          be permitted to be indemnified under applicable law, and (ii) the obligation of
          the Company to make an Expense Advance pursuant to Section 2(a) shall be subject
          to the condition that, if, when and to the extent that the Reviewing Party
          determines that Indemnitee would not be permitted to be so indemnified under
          applicable law, the Company shall be entitled to be reimbursed by Indemnitee
          (who hereby agrees to reimburse the Company) for all such amounts theretofore
          paid; provided, however, that if Indemnitee has commenced or thereafter
          commences legal proceedings in a court of competent jurisdiction to secure a
          determination that Indemnitee should be indemnified under applicable law, any
          determination made by the Reviewing Party that Indemnitee would not be permitted
          to be indemnified under applicable law shall not be binding and Indemnitee shall
          not be required to reimburse the Company for any Expense Advance until a final
          judicial determination is made with respect thereto (as to which all rights of
          appeal therefrom have been exhausted or lapsed). If there has not been a Change
          in Control, the Reviewing Party shall be selected by the Board of Directors, and
          if there has been a Change in Control, the Reviewing Party shall be the
          Independent Legal Counsel referred to in Section 3 hereof. If there has been no
          determination by the Reviewing Party or if the Reviewing Party determines that
          Indemnitee substantively would not be permitted to be indemnified in whole or in
          part under applicable law, Indemnitee shall have the right to commence
          litigation in any court in the State of Delaware having subject matter
          jurisdiction thereof and in which venue is proper seeking an initial
          determination by the court or challenging any such determination by the
          Reviewing Party or any aspect thereof, including the legal or factual bases
          therefor, and the Company hereby consents to service of process and to appear in
          any such proceeding. Any determination by the Reviewing Party otherwise shall be
          conclusive and binding on the Company and Indemnitee.

3.       
          Change in Control. The Company agrees that if there is a Change in
          Control of the Company then with respect to all matters thereafter arising
          concerning the rights of Indemnitee to indemnity payments and Expense Advances
          under this Agreement or any other agreement or Company By-law now or hereafter
          in effect relating to Claims for Indemnifiable Events, the Company shall seek
          legal advice only from Independent Legal Counsel selected by Indemnitee and
          approved by the Company (which approval shall not be unreasonably withheld).
          Such counsel, among other things, shall render its written opinion to the
          Company and Indemnitee as to whether and to what extent the Indemnitee would be
          permitted to be indemnified under applicable law. The Company agrees to pay the
          reasonable fees of the Independent Legal Counsel referred to above and to
          indemnify fully such counsel against any and all expenses (including
          attorneys fees), claims, liabilities and damages arising out of or
          relating to this Agreement or its engagement pursuant hereto.

| | 4. | Indemnification for Additional Expenses. The Company shall indemnify
                    Indemnitee against any and all expenses (including attorneys fees) and to
                    the fullest extent permitted by law, if requested by Indemnitee, shall (within
                    two business days of such request) advance such expenses to Indemnitee, which
                    are incurred by Indemnitee in connection with any action brought by Indemnitee
                    for (i) indemnification or advance payment of Expenses by the Company under this
                    Agreement or any other agreement or Company By-law now or hereafter in effect
                    relating to Claims for Indemnifiable Events and/or (ii) recovery under any
                    directors liability insurance policies maintained by the Company,
                    regardless of whether Indemnitee ultimately is determined to be entitled to such
                    indemnification, advance expense payment or insurance recovery, as the case may
                    be.
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| | 5. | Partial Indemnity. If Indemnitee is entitled under any provision of this
                    Agreement to indemnification by the Company for some or a portion of the
                    Expenses, judgments, fines, penalties and amounts paid in settlement of a Claim
                    but not, however, for the total amount thereof, the Company shall nevertheless
                    indemnify Indemnitee for the portion thereof to which Indemnitee is entitled.
                    Moreover, notwithstanding any other provision of this Agreement, to the extent
                    that Indemnitee has been successful on the merits or otherwise in defense of any
                    or all Claims relating in whole or in part to an Indemnifiable Event or in
                    defense of any issue or matter therein, including dismissal without prejudice,
                    Indemnitee shall be indemnified against all Expenses incurred in connection
                    therewith.
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| | 6. | Burden of Proof. In connection with any determination by the Reviewing
                    Party or otherwise as to whether Indemnitee is entitled to be indemnified
                    hereunder the burden of proof shall be on the Company to establish that
                    Indemnitee is not so entitled.
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| | 7. | No Presumptions. For purposes of this Agreement, the termination of any
                    claim, action, suit or proceeding, by judgment, order, settlement (whether with
                    or without court approval) or conviction, or upon a plea of nolo contendere, or
                    its equivalent, shall not create a presumption that Indemnitee did not meet any
                    particular standard of conduct or have any particular belief or that a court has
                    determined that indemnification is not permitted by applicable law. In addition,
                    neither the failure of the Reviewing Party to have made a determination as to
                    whether Indemnitee has met any particular standard of conduct or had any
                    particular belief, nor an actual determination by the Reviewing Party that
                    Indemnitee has not met such standard of conduct or did not have such belief,
                    prior to the commencement of legal proceedings by Indemnitee to secure a
                    judicial determination that Indemnitee should be indemnified under applicable
                    law shall be a defense to Indemnitees claim or create a presumption that
                    Indemnitee has not met any particular standard of conduct or did not have any
                    particular belief.
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| | 8. | Nonexclusivity. The rights of the Indemnitee hereunder shall be in
                    addition to any other rights Indemnitee may have under the Companys
                    By-laws or the Delaware General Corporation Law or otherwise. To the extent that
                    a change in the Delaware General Corporation Law (whether by statute or judicial
                    decision) permits greater indemnification by agreement than would be afforded
                    currently under the Companys By-laws and this Agreement, it is the intent
                    of the parties hereto that Indemnitee shall enjoy by this Agreement the greater
                    benefits so afforded by such change.
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| | 9. | Liability Insurance. To the extent the Company maintains an insurance
                    policy or policies providing director liability insurance, Indemnitee shall be
                    covered by such policy or policies, in accordance with its or their terms, to
                    the maximum extent of the coverage available for any Company director. In the
                    event of a Change of Control, the Company shall use reasonable efforts to obtain
                    at least twenty million dollars of insurance (directors
                    insurance) on behalf of the directors and officers of the Company against
                    any liability asserted against any such person and incurred by such person in
                    such capacity by reason of (or arising in whole or in part out of) an
                    Indemnifiable Event, whether or not the Company would have the power to
                    indemnify such person against such liability under the provisions of this
                    Agreement or applicable law. In the event of a Change of Control, if such
                    coverage is reasonably obtainable, the Company shall use reasonable efforts to
                    obtain directors insurance which shall not have any deductible or
                    retainage or any co-insurance. In the event of a Change of Control, if
                    reasonably obtainable, the Company shall use reasonable efforts to obtain
                    directors insurance which shall be maintained on behalf of the directors
                    of the Company for at least 36 months after having ceased to be a director of
                    the Company.
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| | 10. | Period of Limitations. No legal action shall be brought and no cause of
                    action shall be asserted by or in the right of the Company or on its behalf
                    against Indemnitee, Indemnitees spouse, heirs, executors or personal or
                    legal representatives after the expiration of two years from the date of accrual
                    of such cause of action, and any claim or cause of action of the Company shall
                    be extinguished and deemed released unless asserted by the timely filing of a
                    legal action within such two-year period; provided, however, that if any shorter
                    period of limitations is otherwise applicable to any such cause of action such
                    shorter period shall govern.
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| | 11. | Scope.
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| | (a) | In the event of any change, after the date of this Agreement, in any applicable
                    law, statute or rule which expands the right of a Delaware corporation to
                    indemnify a member of its board of directors, such change shall be deemed to be
                    within the purview of Indemnitees rights and the Companys
                    obligations under this Agreement. In the event of any change in any applicable
                    law, statute or rule which narrows the right of a Delaware corporation to
                    indemnify a member of its board of directors, such change, to the extent not
                    otherwise required by such law, statute or rule to be applied to this Agreement,
                    shall have no effect on this Agreement or the parties rights and
                    obligations hereunder.
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| | (b) | The Indemnitees rights hereunder shall apply to claims made against the
                    Indemnitee arising out of alleged acts or omissions which occurred prior to the
                    date hereof as well as those which occur after the date hereof.
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| | 12. | Amendments. No supplement, modification or amendment of this Agreement or
                    waiver of any of the provisions hereof shall be binding unless executed in
                    writing by both of the parties hereto. No waiver of any of the provisions of
                    this Agreement shall be deemed or shall constitute a waiver of any other
                    provisions hereof (whether or not similar) nor shall such waiver constitute a
                    continuing waiver.
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| | 13. | Subrogation. In the event of payment under this Agreement, the Company
                    shall be subrogated to the extent of such payment to all of the rights of
                    recovery of Indemnitee, who shall execute all papers required and shall do
                    everything that may be necessary to secure such rights, including the execution
                    of such documents necessary to enable the Company effectively to bring suit to
                    enforce such rights.
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| | 14. | No Duplication of Payments. The Company shall not be liable under this
                    Agreement to make any payment in connection with any Claim made against
                    Indemnitee to the extent Indemnitee has otherwise actually received payment
                    (under any insurance policy, By-law or otherwise) of the amounts otherwise
                    indemnifiable hereunder.
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| | 15. | Binding Effect.
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| | (a) | This Agreement shall be binding upon and inure to the benefit of and be
                    enforceable by the parties hereto and their respective successors, assigns,
                    including any direct or indirect successor by purchase, merger, consolidation or
                    otherwise to all or substantially all of the business and/or assets of the
                    Company, spouses, heirs, executors and personal and legal representatives.
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| | (b) | This Agreement shall continue in effect regardless of whether Indemnitee
                    continues to serve as a director of the Company.
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| | 16. | Severability. The provisions of this Agreement shall be severable in the
                    event that any of the provisions hereof (including any provision within a single
                    section, paragraph or sentence) are held by a court of competent jurisdiction to
                    be invalid, void or otherwise unenforceable in any respect, and the validity and
                    enforceability of any such provision in every other respect and of the remaining
                    provisions hereof shall not be in any way impaired and shall remain enforceable
                    to the fullest extent permitted by law.
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| | 17. | Governing Law. This Agreement shall be governed by and construed and
                    enforced in accordance with the laws of the State of Delaware applicable to
                    contracts made and to be performed in such state without giving effect to the
                    principles of conflicts of laws.
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| | 18. | Consent to Jurisdiction. The Company and Indemnitee each hereby
                    irrevocably consents to the jurisdiction of the courts of the State of Delaware
                    for all purposes in connection with any proceeding which arises out of or
                    relates to this Agreement.
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| | 19. | Notices. All notices, requests, demands and other communications under
                    this Agreement shall be in writing (including telecopier or similar writing) and
                    shall be deemed to have been given at the time when mailed, enclosed in a
                    registered postpaid envelope, in any general or branch office of the United
                    States Postal Service, return receipt requested, or sent by Federal Express or
                    other similar overnight courier service, addressed to the address of the party
                    as set forth on the signature page of this Agreement (in the case of the
                    Company, to the attention of its Secretary) or to such changed address as such
                    party may have fixed by notice or, in the case of the Company to its registered
                    agent in the state of Delaware, or, if given by telecopier, when such telecopy
                    is transmitted and the appropriate answerback is received.
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| | 20. | Counterparts. This Agreement may be executed in counterparts, each of
                    which shall be deemed to be an original.
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IN WITNESS WHEREOF, the parties
hereto have executed this Agreement this 18th day of December 2003, in the case
of the Company by an officer thereunto duly authorized.

|                                                                                                                                                              | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|UNITED RETAIL GROUP, INC.By: __________Raphael BenaroyaChief Executive OfficerAddress: 365 West Passaic StreetRochelle Park, NJ 07662Telecopy: (201) 845-6309 | 
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|INDEMNITEEBy: Name:Address:Telecopy:                                                                                                                          |