<PAGE> 


                                                



                          SECURITIES AND EXCHANGE COMMISSION
                                  Washington, D. C.
                                        20549

                                   _______________

                                      FORM 10-Q

                   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                        OF THE SECURITIES EXCHANGE ACT OF 1934

                                   _______________

     For the 13 and 39 week periods                 Commission file number 1-777
     ended October 31, 1998

                                J. C. PENNEY COMPANY, INC. 
     ___________________________________________________________________________

                (Exact name of registrant as specified in its charter)

                    Delaware                                     13-5583779    
     ___________________________________________________________________________

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

     6501 Legacy Drive, Plano, Texas                              75024 - 3698 
     ___________________________________________________________________________

     (Address of principal executive offices)                     (Zip Code)


     Registrant's telephone number, including area code         (972) 431-1000 
                                                        ________________________


                                    ___________________

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

     Yes    X   .       No        .  
         _______           _______

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

     254,309,645 shares of Common Stock of 50c par value, as of October 31,
     1998. 
 
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                                        -1-


     PART I - FINANCIAL INFORMATION

     Item 1 - Financial Statements.

     The following interim financial information is unaudited but, in the
     opinion of the Company, includes all adjustments, consisting only of normal
     recurring accruals, necessary for a fair presentation.  Certain prior
     period amounts have been reclassified to conform with the current period
     presentation.  The financial information should be read in conjunction with
     the audited consolidated financial statements included in the Company's
     Annual Report on Form 10-K for the 53 weeks ended January 31, 1998.


     Statements of Income
     (Amounts in millions except per share data)

                                      13 weeks ended         39 weeks ended    
                                   _____________________   _____________________
                                   Oct. 31,    Oct. 25,    Oct. 31,     Oct 25,
                                     1998        1997        1998        1997  
                                   _________   _________   _________   _________

     Retail sales                  $  7,297    $  7,208    $ 20,613    $ 20,109
     Direct marketing revenue           252         233         749         686
                                   ________    ________    ________     _______
     Total revenue                    7,549       7,441      21,362      20,795 
                                   ________    ________    ________     _______

     Costs and expenses
       Cost of goods sold, occupancy, 
        buying,and warehousing costs  5,282       5,171      15,065      14,559
       Selling, general, and 
        administrative expenses       1,618       1,554       4,670       4,539
       Costs and expenses of direct 
        marketing operations            194         182         578         529
       Other                             (6)         (6)         (2)        (35)
       Net interest expense and credit 
         operations                     142         152         350         355 
       Amortization of intangible assets
         and minority interest           15          14          68          72
       Business acquisition and 
         consolidation expenses, net     --         190          --         217 
                                     ______    ________    ________    ________
     Total costs and expenses         7,245       7,257      20,729      20,236 
                                     ______    ________    ________    ________
     Income before income taxes         304         184         633         559
     Income taxes                       118          71         246         217 
                                     ______    ________    ________    ________

     Net income                      $  186    $    113    $    387    $    342 
                                     ======    ========    ========    ========

     Earnings per common share:

     Net income                      $  186    $    113    $    387    $    342
     Less: preferred stock dividend     (10)        (10)        (28)        (30)
                                      ______    ________    ________    ________
     Earnings for Basic EPS             176         103         359         312
     Stock options and convertible
       preferred stock                   10          10          27          28 
                                     _______   ________    ________    ________
     Earnings for Diluted EPS        $  186    $    113    $    386    $    340

     Shares
     Average shares outstanding (used
       for Basic EPS)                   254         250         253         246 
     Common stock equivalents            18          20          19          21 
                                     ______    ________    ________    ________
     Average diluted shares 
      outstanding                       272         270         272         267

     Earnings per share
     Basic                           $ 0.69    $   0.42    $   1.42    $   1.27
     Diluted                           0.68        0.40        1.42        1.25 

<PAGE>
                                         -2-


     Balance Sheets
     (Amounts in millions)

                                        Oct. 31,        Oct. 25,        Jan. 31,
                                          1998            1997            1998  
                                        ________        ________        ________

     ASSETS

     Current assets

       Cash and short term investments
         of $552, $172, and $208        $    552        $    208        $    287

        Retained interest in JCP Master
          Credit Card Trust                1,032             862           1,073

        Receivables, net                   3,573           3,572           3,819

        Merchandise inventory (LIFO reserves
          of $252, $227, and $225)         7,017           7,249           6,162

        Prepaid expenses                     147              78             143
                                        ________        ________        ________


          Total current assets            12,321          12,149          11,484

     Properties, net of accumulated
          depreciation of $3,267, $3,148,
          and $2,945                       5,332           5,130           5,329

     Investments, primarily direct marketing
          operations                       1,896           1,737           1,774

     Deferred direct marketing policy 
          acquisition costs                  810             728             752

     Goodwill and other intangible assets
           net of accumulated amortization
           of $176, $64, and $108          2,923           3,061           2,940

     Other assets                          1,247           1,387           1,214
                                        ________        ________        ________

                                        $ 24,529        $ 24,192        $ 23,493
                                        ========        ========        ========

<PAGE>
                                         -3-
     Balance Sheets
     (Amounts in millions)
                                        Oct. 31,        Oct. 25,        Jan. 31,
                                          1998            1997            1998  
                                        ________        ________        ________
     LIABILITIES AND STOCKHOLDERS' EQUITY
     Current liabilities
       Accounts payable and 
        accrued expenses                 $ 4,000         $ 3,859        $ 4,155
       Short term debt                     2,518           2,218          1,417
       Current maturities of 
        long term debt                       625              --            449
       Deferred taxes                        123              92            116 
                                         _______         _______        _______
         Total current liabilities         7,266           6,169          6,137

     Long term debt                        6,737           7,487          6,986

     Deferred taxes                        1,388           1,500          1,325

     Insurance policy and claims reserves    919             849            872

     Other liabilities                       798             981            816 
                                         _______         _______        _______
         Total liabilities                17,108          16,986         16,136

     Stockholders' equity
       Preferred stock, without par value:
         Authorized, 25 million shares -
         issued, 1 million shares of
         Series B ESOP 
         convertible preferred               483             535            526
       Guaranteed ESOP obligation             --             (96)           (49)
       Common stock, par value 50c:
         Authorized, 1,250 million shares -
         issued, 254, 250, and 251 million
         shares                            2,877           2,727          2,766 
                                         _______         _______        _______
       Total capital stock                 3,360           3,166          3,423 
                                         _______         _______        _______

       Reinvested earnings and other 
         comprehensive income at 
         beginning of year                 4,114           4,110          4,110

       Comprehensive income
         Net income                          387             342            566

         Net unrealized change in debt
         and equity securities, and foreign
         currency translation adjustments,
         net of tax                           (7)              7             11 
                                          ______         _______        _______
       Total comprehensive income            380             349            577

      Common stock dividends declared       (414)           (399)          (533)

       Preferred stock dividends
         declared, net of taxes              (19)            (20)           (40)
                                          ______         _______        _______

       Reinvested earnings and other 
         comprehensive income at 
         end of period                      4,061           4,040          4,114
                                          _______         _______        _______

         Total stockholders' equity         7,421           7,206          7,357
                                          _______         _______        _______

                                          $24,529         $24,192        $23,493
                                          =======         =======        =======

     The accumulated balances for net unrealized changes in debt and equity
     securities were $70, $57, and $66, and for foreign currency translation
     adjustments were ($29), ($14), and ($18) as of the respective dates shown. 

<PAGE>
                                         -4-


     Statements of Cash Flows
     (Amounts in millions)

                                                         39 weeks ended         
                                                   ___________________________

                                                   Oct. 31,           Oct. 25,
                                                     1998               1997    
                                                   ________          _________

     Operating activities

     Net income                                    $    387          $    342
     Gain on the sale of bank assets                     --               (52)
     Depreciation and amortization, including
         intangibles                                    459               410
     Deferred taxes                                      70               177
     Change in cash from:
         Customer receivables                           517               384
         Inventories, net of trade payables            (469)           (1,039)
         Current taxes payable                         (113)               25
         Other assets and liabilities, net             (679)             (587)  
                                                   ________          ________
                                                        172              (340)  
                                                   ________          ________

     Investing activities

     Capital expenditures                              (508)             (581)
     Proceeds from the sale of bank assets, net          --               276 
     Purchases of investment securities                (511)             (339)
     Proceeds from sales of investment securities       382               215
     Changes in Retained Interest in
         JCP Master Credit Card Trust                    41               249   
                                                   ________          ________
                                                       (596)             (180)  
                                                   ________          ________

     Financing activities

     Increase/(decrease) in short term debt           1,101            (1,732)
     Net proceeds from the issuance 
       of long term debt                                 --             2,979
     Payment of long term debt                          (50)             (295)
     Common stock issued, net                           110                82
     Preferred stock retired                            (42)              (33)
     Dividends paid, preferred and common              (430)             (404)  
                                                   ________          ________
                                                        689               597   
                                                   ________          ________

     Net increase/(decrease) in cash and short term
       investments                                      265                77

     Cash and short term investments at beginning
       of year                                          287               131
                                                   ________          ________

     Cash and short term investments at end of
       third quarter                               $    552          $    208
                                                   ========          ========
     Non-cash transaction    
     ____________________

     On February 27, 1997, the Company completed the acquisition of Eckerd
     Corporation through the exchange of 23.2 million shares of JCPenney common
     stock for the remaining 49.9 per cent of the outstanding common stock of 
     Eckerd. The value of the non-cash portion of the acquisition was
     approximately $1.3 billion. 

<PAGE>
                                         -5-


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

     Financial Condition 
     ___________________

     Merchandise inventory for JCPenney department stores and catalog totaled
     $5,112 million at the end of the third quarter, a decline of 1.2 per cent
     compared with $5,174 million at the end of last year's third quarter.
     Eckerd merchandise inventories totaled $2,157 million at the end of the
     third quarter, a 6.3 per cent decline compared with $2,302 million at the
     end of last year's third quarter. Last year's inventory levels were higher
     than normal in anticipation of grand reopenings of converted drugstores in
     the northeastern United States.

     Properties, net of accumulated depreciation, totaled $5,332 million at
     October 31, 1998 compared with $5,130 million a year earlier. As of the end
     of the third quarter, the Company operated 1,165 JCPenney stores comprising
     116.0 million gross square feet compared with 1,220 stores comprising 119.3
     million gross square feet at the end of 1997's third quarter. The decline
     is principally related to the closing of underperforming stores. In
     addition, the Company operated 2,738 Eckerd drugstores at the end of the
     quarter, a net decline from 2,769 at the end of last year's third quarter.
     The net decline in drugstores is primarily related to the conversion of the
     Company's multiple drugstore chains to the Eckerd format. Eckerd's new
     store opening activity continues to be focused on relocating existing
     stores to more productive, free-standing locations. During the first nine
     months of 1998, Eckerd has relocated 121 drugstores compared with the
     relocation of 94 stores in the comparable 1997 period.

     Capital expenditures for the first nine months of 1998 totaled $508 million
     compared with $581 million in the comparable 1997 period. Drugstore
     expenditures accounted for $165 million in 1998 compared with $254 million
     in 1997 which included significant transition related costs.  The balance
     of the spending related primarily to JCPenney stores and catalog. 

     There have been no significant changes in the Company's long term debt
     during the first nine months of fiscal 1998. Long term debt totaled $6,737
     million at the end of the third quarter compared with $6,986 million at the
     end of fiscal 1997 and $7,487 million at the end of third quarter 1997. The
     decrease from both year end and third quarter 1997 balances is comprised of
     the reclassification of certain amounts to current maturities and normal
     debt retirements.


     Results of Operations 
     _____________________

     Consolidated operating results

     Net income for the quarter totaled $186 million or 68 cents per diluted
     share compared with income before business acquisition and consolidation
     expenses, net of tax, of $229 million, or 85 cents per share, and net
     income of $113 million or 40 cents per share, in last year's period. Last
     year's third quarter net income reflected charges of $190 million, or 45
     cents per share, related principally to the Company's early retirement
     program. For the 39 weeks ended October 31, 1998, income before drugstore
     integration charges and business acquisition and consolidation expenses,
     net of tax, totaled $457 million, or $1.67 per share, compared with $474 
     million, or $1.76 per share, in last year's comparable period. Net income
     for the nine months totaled $387 million or $1.42 per diluted share
     compared with $342 million or $1.25 per share last year. Charges in 1998
     were principally related to the Company's drugstore operation 

<PAGE>
                                         -6-

     while 1997 charges were principally related to the Company's early
     retirement program.


     Segment Operating Results

     Department Stores and Catalog 
     _____________________________

                                          13 weeks ended        39 weeks ended  
                                       ___________________    _________________
                                       Oct. 31,   Oct. 25,    Oct. 31,  Oct 25,
                                         1998       1997        1998      1997  
                                       _______   _________    _______  ________
     ($ in millions)
     Retail sales                    $  4,807    $  4,927    $ 13,109  $ 13,213
     Cost of goods sold                (3,299)     (3,358)     (9,055)   (9,133)
     LIFO charge/(credit)                  --          --          --        --
     SG&A expenses                     (1,179)     (1,149)     (3,336)   (3,342)
                                    _________   _________   _________ ________
     Operating profit (1)            $    329    $    420    $    718  $    738


     Sales per cent increase/(decrease)
       Total department stores           (5.0)       (1.5)       (2.1)      2.2
       Comparable stores                 (4.0)       (2.5)       (1.7)      1.2
       Catalog                            8.0         2.6         4.4       2.7
     Ratios as a per cent of sales
       FIFO gross margin                 31.4        31.8        30.9      30.9
       SG&A expenses                     24.5        23.3        25.4      25.3
       FIFO operating profit (1)          6.9         8.5         5.5       5.6
       FIFO EBITDA                        9.7        11.0         9.3       9.1


       (1) Operating profit excludes net interest expense and credit operations,
           amortization of intangible assets and minority interest, business
           acquisition and consolidation expenses, net, and income taxes.


     Sales for department stores were soft throughout the third quarter,
     totaling $3,749 million, a decline of 5.0 per cent from last year's third
     quarter. Sales for comparable stores, those stores open at least a year,
     declined 4.0 per cent. Catalog sales totaled $1,058 million, an 8.0 per
     cent increase from last year. Catalog sales benefitted from the
     participation in coordinated marketing programs with department stores.
     Stores and catalog FIFO gross margin totaled $1,508 million compared with
     $1,569 million in last year's third quarter. Selling, general, and
     administrative (SG&A) expenses increased $30 million, or 2.6 per cent, in
     the quarter from the prior year. Expense increases were principally related
     to advertising. Both the gross margin and SG&A ratios during the quarter
     were negatively impacted by low sales volume in department stores. Gross
     margin declined by 40 basis points in this year's third  quarter, while
     SG&A expenses increased by 120 basis points. Operating profit was $329
     million in the third quarter compared with $420 million in last year's
     period.

     Sales for department stores for the 39 weeks ended October 31, 1998 totaled
     $10,409 million, down approximately two per cent on both a total stores and
     comparable store basis from last year's period. Catalog sales for the nine
     months totaled $2,700 million, an increase of 4.4 per cent from the prior
     year. Stores and catalog FIFO gross margin was $4,054 million for the nine
     months, down slightly from last year as a result of weak sales. SG&A 
     expenses were $3,336 million for the first nine months, a slight decline
     from the comparable period last year. As a per cent of sales, gross margin
     was flat with last year while SG&A expenses were 10 basis points higher
     than last year.  Operating 

<PAGE>
                                         -7-

     profit totaled $718 million compared with $738 million in last year's
     comparable period, and has been negatively impacted by sales volumes in
     department stores, particularly in the second and third quarters.



     Eckerd Drugstores 
     _________________

                                       13 weeks ended         39 weeks ended  
                                     ___________________    _________________
                                     Oct. 31,   Oct. 25,    Oct. 31,  Oct 25,
                                       1998       1997        1998      1997  
                                     _______   _________    _______  ________
     ($ in millions)
     Retail sales                  $  2,490   $  2,281   $  7,504   $  6,896
     Cost of goods sold              (1,973)    (1,805)    (5,983)(1) (5,411)
     LIFO charge                        (10)        (8)       (27)       (15)
     SG&A expenses                     (439)      (405)    (1,334)(1) (1,197) 
                                  _________  _________  _________   ________
     Operating profit (2)          $     68   $     63   $    160   $    273


     Sales per cent increase
       Total drugstores                 9.2       10.6 (3)    8.8       11.7 (3)
       Comparable stores               10.0        7.2        8.9        7.5
     Ratios as a per cent of sales
       FIFO gross margin               20.8       20.9       21.6 (4)   21.6
       SG&A expenses                   17.7       17.8       17.5 (4)   17.4
       FIFO operating profit            3.1        3.1        4.1 (4)    4.2
       FIFO EBITDA                      5.9        5.3        6.7 (4)    6.3

       LIFO gross margin               20.4       20.5       21.2 (4)   21.3
       LIFO operating profit            2.7        2.7        3.7 (4)    3.9
       LIFO EBITDA                      5.5        4.9        6.3 (4)    6.1
                                    
       (1) Cost of goods sold and SG&A expenses include drugstore integration
           charges of $98 million and $16 million, respectively (see discussion 
           on page 8).

       (2) Operating profit excludes net interest expense and credit operations,
           amortization of intangible assets and minority interest, business
           acquisition and consolidation expenses, net, and income taxes.

       (3) The percentage shown has been calculated using 1996 pro forma data,
           assuming the Company's drugstore acquisitions had occurred at
           the beginning of fiscal 1996.

       (4) Excludes the effects of drugstore integration charges. Including
           these charges, 1998 gross margin would have declined by 1.3
           percentage points, SG&A expenses would have increased by 0.2     
           percentage points, and operating profit and EBITDA would have each  
           declined by 1.5 percentage points for the 39 weeks.

     Sales were $2,490 million for the 13 weeks ended October 31, 1998, a 9.2
     per cent increase over third quarter 1997. On a comparable store basis,
     sales increased by 10.0 per cent. Sales for comparable stores improved in
     both pharmacy, which increased by 15.3 per cent during the quarter, and
     non-pharmacy merchandise. FIFO gross margin totaled $517 million compared
     with $476 million in last year's third quarter, an increase of 8.6 per 
     cent. As a per cent of sales, gross margin declined by 10 basis points.
     Margin ratio improvement for non-pharmacy merchandise was offset by the mix
     of sales which continue to shift 

<PAGE>                                 -8-
     toward lower margin pharmacy sales. During the quarter, Eckerd recorded a 
     $10 million LIFO charge compared with an $8 million charge in last year's 
     quarter.  SG&A expenses were well managed during the quarter and improved 
     10 basis points as a per cent of sales. FIFO operating profit for the 
     quarter totaled $78 million compared with $71 million in last year's 
     quarter.

     Sales for the 39 weeks totaled $7,504 million compared with $6,896 million
     in last year's period, an increase of 8.8 per cent; comparable store sales
     increased 8.9 per cent. Sales gains were led by a 14.7 per cent increase in
     pharmacy sales. The balance of the discussion addresses drugstore results
     before the 1998 drugstore charges, net (see below). FIFO gross margin for
     the first nine months totaled $1,619 million compared with $1,485 million
     last year, an increase of 9.0 per cent. FIFO gross margin ratio was flat
     compared with last year and reflects improvement for both pharmacy and
     front-end merchandise; however, sales were more heavily weighted towards
     pharmacy which carries lower margins. Eckerd recorded a LIFO charge of $27
     million in the first nine months of 1998 compared with a $15 million charge
     in last year's comparable period. SG&A expenses were higher than last year
     and as a per cent of sales increased by 10 basis points. FIFO operating
     profit for drugstores totaled $301 million compared with $288 million in
     last year's period, and declined by 10 basis points compared with last
     year.

     During 1998's second quarter, the Company recorded pre-tax charges of $114
     million, net, for its drugstore operation. The charges consisted of $98
     million in gross profit adjustments and $16 million of additional costs
     incurred in support of the drugstore integration activities which were
     reported as SG&A expenses. Gross profit adjustments were principally
     related to higher than anticipated losses on the liquidation of merchandise
     categories that were eliminated or replaced during the integration process
     as well as higher than expected shrinkage rates. 


     Direct Marketing Services 
     _________________________

                                         13 weeks ended         39 weeks ended  
                                       ___________________    _________________
                                       Oct. 31,   Oct. 25,    Oct. 31,  Oct 25,
                                         1998       1997        1998      1997  
                                       _______   _________    _______  ________
     ($ in millions)
     Revenue                           $  252     $  233      $  749    $  686
     Costs and expenses                  (194)      (182)       (578)     (529) 
                                       _______    _______     _______   ______
     Operating profit  (1)             $   58     $   51      $  171    $  157

     Revenue, per cent increase           8.2       12.0         9.2      14.1
     Operating profit as a 
       per cent of revenue               23.0       21.9        22.8      22.9

     (1) Operating profit excludes net interest expense and credit operations,
         amortization of intangible assets and minority interest, business
         acquisition and consolidation expenses, net, and income taxes.

     Revenue increased by 8.2 per cent in the third quarter compared with last
     year's period. Revenue growth was led by non-insurance products, which
     increased by 38.5 per cent, and health insurance products, which increased
     by 8.4 per cent. Operating profit for the period was $58 million, an
     increase of $7 million, or 13.7 per cent. For the nine months, direct
     marketing generated an 8.9 per cent increase in operating profit on a 9.2
     per cent increase in revenue. 

<PAGE>
                                         -9-

     Other Corporate Items

     Net Interest Expense and Credit Operations 
     __________________________________________

     Net interest expense and credit operations for the third quarter was $142
     million compared with $152 million in last year's third quarter. The
     decrease was primarily related to reductions in bad debt. Both bankruptcy
     and delinquency rates continued to show positive trends during the quarter.
     As of October 31, 1998, delinquencies were 3.7 per cent of customer
     receivables compared with 4.8 per cent a year ago. For the first nine
     months, net interest expense and credit operations totaled $350 million
     compared with $355 million in last year's period. The decline was
     principally related to improvement in bad debt expense, which was $26
     million, or 13.5 per cent, better than last year, offset by higher interest
     costs associated with the Eckerd acquisition. Total customer receivables
     serviced at October 31, 1998 totaled $3,893 million, a decline of $482
     million, or 11.0 per cent, from the comparable period last year. The
     decrease is principally related to the continued shift of credit purchases
     to third party credit cards.


     Income Taxes 
     ____________

     The Company's effective income tax rate was 38.8 per cent in the third
     quarter, up 20 basis points from last year. For the first nine months, the
     effective income tax rate was 38.8 per cent compared with 38.9 per cent
     last year.   


     Year 2000 
     _________

     The Year 2000 issue exists because many computer systems store and process
     dates using only the last two digits of the year.  Such systems, if not
     changed, may interpret "00" as "1900" instead of the year "2000."  The
     Company has been working to identify and address Year 2000 issues since
     January 1995.  The scope of this effort includes internally developed
     information technology systems, purchased and leased software, embedded
     systems, and electronic data interchange transaction processing.

     In October 1996, a companywide task force was formed to provide guidance to
     the Company's operating and support departments and to monitor the progress
     of efforts to address Year 2000 issues.  The Company has also consulted
     with various third parties, including, but not limited to, outside
     consultants, outside service providers, infrastructure suppliers, industry
     groups, and other retail companies and associations to develop industrywide
     approaches to the Year 2000 issue, to gain insights to problems, and to
     provide additional perspectives on solutions. It is expected that
     compliance work will be substantially completed by the end of 1998. 
     Beginning in January 1999, all systems critical to the Company's core
     businesses will be retested.  The Company has also focused on the Year 2000
     compliance status of its suppliers, and is participating in a National
     Retail Federation survey of suppliers and service providers to determine
     their Year 2000 readiness. 

     Despite the significant efforts to address Year 2000 concerns, the Company
     could potentially experience disruptions to some of its operations,
     including those resulting from noncompliant systems used by third party
     business and governmental entities.  The Company has developed contingency 
     plans to address potential Year 2000 disruptions.  These plans include
     business continuity plans that address accessibility and functionality of
     Company facilities as well as steps to be taken if an event causes failure
     of a system critical to the Company's core business activities. 

<PAGE>
                                         -10-

     Through October 31, 1998, the Company has incurred approximately $25
     million on a cumulative basis to achieve Year 2000 compliance.  The
     Company's projected cost for Year 2000 remediation is currently estimated
     to be $46 million.  Total costs have not had, and are not expected to have,
     a material impact on the Company's financial results.



     New Accounting Rules 
     ____________________

     The Financial Accounting Standards Board has issued Statement of Financial
     Accounting Standards No. 133, "Accounting for Derivative Instruments and   
                                   __________________________________________
     Hedging Activities", which is effective for quarters beginning after June 
     -------------------
     15, 1999. The Company has a limited exposure to derivative products and
     does not expect these new rules to have a material impact on reported
     results.

     The American Institute of Certified Public Accountants has issued
     Statements of Position (SOP) No. 98-1, "Accounting for the Costs of     
                                             ___________________________
     Computer Software Developed or Obtained for Internal Use" and No. 98-5, 
     __________________________________________________________
     "Reporting on the Costs of Start-Up Activities." The new accounting rules, 
     ________________________________________________
     which have been adopted, did not have a material impact on the Company's
     results of operations.



     Subsequent Events 
     _________________

     On November 23, 1998, the Company entered into a definitive agreement to
     acquire Genovese Drug Stores, Inc. (Genovese). Genovese operates 141
     drugstores in New York, New Jersey, and Connecticut. Under terms of the
     agreement, Genovese shareholders will receive J. C. Penney Company, Inc.
     common stock valued at $30 for each share of Genovese common stock they
     own. The transaction is valued at approximately $432 million, plus the
     assumption of approximately $60 million of Genovese debt. The acquisition,
     which will be accounted for as a purchase, is expected to close during the
     first quarter of 1999. 

     On November 25, 1998, the Company's indirect, wholly owned, special purpose
     subsidiary, JCP Receivables, Inc., completed a public offering of $650
     million principal amount of 5.50 per cent Class A Asset-Backed
     Certificates, Series E issued by the JCP Master Credit Card Trust. Proceeds
     of the offering will be used for general corporate purposes.


      



     The Company's business depends to a great extent on the last quarter of the
     year. Historically, sales for that period have averaged approximately one
     third of annual sales.  Accordingly, the results of operations for the 13
     and 39 weeks ended October 31, 1998 are not necessarily indicative of
     results for the entire year.

<PAGE>
                                         -11-

     Item 3   Quantitative and Qualitative Disclosures About Market Risk

     Not Required.




     This report may contain forward-looking statements within the meaning of   
     the Private Securities Litigation Reform Act of 1995. Such forward-looking 
     statements, which reflect the Company's current views of future events and 
     financial performance, involve known and unknown risks and uncertainties   
     that may cause the Company's actual results to be materially different from
     planned or expected results. Those risks and uncertainties include but are 
     not limited to competition, consumer demand, seasonality, economic
     conditions, government activity, and the year 2000 compliance readiness of
     the Company's suppliers and service providers as well as government     
     agencies. Investors should take such risks and uncertainties into account 
     when making investment decisions. 



     PART II - OTHER INFORMATION


     Item 1 - Legal Proceedings.

          The Company has no material legal proceedings pending against it.


     Item 6 - Exhibits and Reports on Form 8-K.  

          (a)   Exhibits 
                ________

                The following documents are filed as exhibits to this report:

               10     Eckerd Corporation Loan Agreement, dated as of September 
                      28, 1998, between J. C. Penney Company, Inc., as Lender, 
                      and Eckerd Corporation, as Borrower.

               11     Computation of net income per common share.

               12(a)  Computation of ratios of available income to combined 
                      fixed charges and preferred stock dividend requirement.

               12(b)  Computation of ratios of available income to fixed
                      charges.

                27(a) Financial Data Schedule for the nine months ended 
                      October 31, 1998.

                27(b) Restated Financial Data Schedule for the nine months ended
                      October 25, 1997.

          (b)   Reports on Form 8-K 
                ___________________

                None. 

<PAGE>
                                         -12-













                                      SIGNATURES


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











                                          J. C. PENNEY COMPANY, INC.




                                          By     /S/W. J. Alcorn  
                                            _______________________________
                                                    W. J. Alcorn
                                           Vice President and Controller
                                           (Principal Accounting Officer)



     Date:  December 14, 1998