SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                                  FORM 10-K

      XAnnual  Report  pursuant  to  Section  13 or 15(d) of the Securities
Exchange Act of 1934 (No Fee Required) For Fiscal Year Ended December 31, 1996
     or
Transition  Report pursuant to Section 13 or 15 (d) of the Securities Exchange
Act of 1934 (No Fee Required) For the transition period from ______ to ______
Commission File No. 0-20712

                             CASINO MAGIC CORP.

            (Exact name of Registrant as specified in its charter)

           Minnesota                                 64-0817483
      (State or other jurisdiction of                   (I.R.S. Employer
    incorporation or organization)                  Identification Number)

            711 Casino Magic Drive, Bay Saint Louis, MS    39520
           (Address of principal executive offices)     (Zip Code)

      Registrant's telephone number, including area code: (601) 466-8000

         Securities registered pursuant to Section 12(b) of the Act:

                                    None
         Securities registered pursuant to Section 12(g) of the Act:

                                Common Stock
                               (Title of Class)

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 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 [  ]

The  aggregate  market value of the voting stock held by non-affiliates of the
Registrant was as of March 21, 1997.  As of the close of business
, there wereshares of the Registrant's common stock outstanding.

<PAGE>
DOCUMENTS INCORPORATED BY REFERENCE

The following documents are incorporated herein by reference:

The  discussions  under  the  sections  captioned  ELECTION  OF  DIRECTORS,"
"EXECUTIVE  COMPENSATION," "CERTAIN TRANSACTIONS" and "PRINCIPAL SHAREHOLDERS"
to be included in the Registrant's definitive proxy statement to be filed with
the  Securities  and  Exchange  Commission  and  delivered to the Registrant's
shareholders  pursuant  to  Regulation  14A  promulgated  under the Securities
Exchange  Act of 1934, with respect to the 1997 annual meeting of shareholders
of  the Registrant are incorporated herein in response to Items 10, 11, 12 and
13 of Part III hereof, respectively.







































                                      ii

<PAGE>
                                    INDEX
                                                                          Page
                                    PART I
Item 1. - BUSINESS...................................................      1
Item 2. - PROPERTIES.................................................     23
Item 3. - LEGAL PROCEEDINGS..........................................     26
Item 4. - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS........     27
                                   PART II
Item 5. - MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
          STOCKHOLDER MATTERS........................................     27
Item 6. - SELECTED FINANCIAL DATA....................................     29
Item 7. - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
          CONDITION AND RESULTS OF OPERATIONS........................     30
Item 8. - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA................     40
Item 9. - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
          ON ACCOUNTING AND FINANCIAL DISCLOSURE.....................     40
                                   PART III
Item 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Item 11 - EXECUTIVE COMPENSATION
Item 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Item 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Items  10,  11,  12 and 13 ARE INCORPORATED BY REFERENCE TO THE COMPANY'S 1997
DEFINITIVE PROXY STATEMENT
                                   PART IV
Item 14 - EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
           FORM 8-K .................................................     41
CONSOLIDATED FINANCIAL STATEMENTS....................................     F-1
EXHIBITS











                                     iii

<PAGE>
                                   PART I.

ITEM 1.     BUSINESS

GENERAL

Casino  Magic  Corp., through its wholly owned subsidiaries, owns and operates
casinos  and  related  amenities  primarily in the southeastern United States,
including  two  dockside  facilities  on the Mississippi Gulf Coast at Bay St.
Louis  and  Biloxi,  Mississippi,  and  one dockside facility in Bossier City,
Louisiana,  which  opened  on  October  4,  1996.  In addition to its domestic
operations,  a Casino Magic Corp., through wholly owned subsidiaries, owns and
operates two  casinos in Neuqu n and San Mart n de los Andes, Argentina.

The  following is a tabulation of the Company's operating casino properties at
December 31, 1996:

                      Date          Casino
                   Commenced        Square          Slot     Table     Hotel
                    Business        Footage       Machines   Games     Rooms
                   ---------        -------       --------   -----    ------
Bay Saint Louis       9/92          39,500         1,101       44        201
Biloxi                6/93          47,700         1,196       36        --
Bossier City         10/96          30,000           986       44        --
Argentina             1/95          29,000           395       54        --
                                   -------        ------      ---       ----
Total                              146,200         3,678      178       201
                                   =======        ======      ===       ====

In  May 1995, the Company opened a gaming facility in Porto Carras, Greece, in
which  the  Company  had  a  49%  equity  ownership.    In addition, since its
inception  in 1992, the Company owned and operated a small hotel and casino in
Deadwood,  South  Dakota.   In 1996, the Company sold its gaming facilities in
Deadwood,  South  Dakota,  and its 49% ownership in a gaming facility in Porto
Carras, Greece, primarily because of poor operating performance.  In addition,
during 1996, the Company terminated all management agreements in Greece.

Unless  the context requires otherwise, reference in this Annual Report to the
"Company"  means  Casino  Magic  Corp.  and  its  relevant  subsidiaries,  and
reference  to  "Casino  Magic"  means  Casino  Magic  Corp.   Casino Magic was
incorporated  under the laws of the State of Minnesota on April 17, 1992.  The
Company's  principal  executive  and administrative offices are located at 711
Casino  Magic  Drive,  Bay  Saint  Louis,  Mississippi  39520.   The Company's
telephone number is (601) 466-8000.

INDUSTRY BACKGROUND
Until  approximately  1988,  legalized  casino gaming in the United States was
restricted substantially to the State of Nevada and the City of Atlantic City,
New  Jersey.    Since then, legalized casino gaming has significantly expanded
throughout  the  United  States.    Numerous  states  have  legalized  either
land-based,  riverboat  or  dockside  gaming.    At  least  35  states sponsor
lotteries, and several states sponsor the use of video poker, video blackjack,
or  video  lottery  machines  in  connection  with their lotteries.  Riverboat
gaming is

                                      1

<PAGE>
conducted  on  vessels  which  by  law are required to leave their mooring and
cruise  during gaming operations.  The laws generally require cruises to be of
a  certain  duration,  and  will  permit dockside gaming shortly preceding and
following  the  cruise  period.   While dockside gaming must be conducted on a
vessel  in  a body of water, the vessel is not required to leave its moorings,
and  customers  may  come  and  go at will.  Dockside gaming was authorized in
Mississippi  in June 1990, but gaming operations did not commence until August
1992,  with  the  opening  of three dockside casinos in Biloxi.  Riverboat and
dockside  gaming was legalized in Louisiana in 1991, but gaming operations did
not  begin  until  October  1993.  Some  states limit the amount that a gaming
customer may bet or lose, which is referred to as "limited stakes gaming," and
prohibit  the  issuance  of  house credit.  The gaming laws of Mississippi and
Louisiana   permit 24-hour unlimited stakes gaming, and permit the issuance of
house credit.

Since  the  passage  of  the  1988 Indian Gaming Regulatory Act, a significant
number  of  North  American  Indian  tribes  have established gaming on Indian
reservations.    Gaming  on  Indian  lands  is  subject to compacts that North
American  Indian tribes are required to enter into with the state in which the
gaming  takes  place,  which  may  or  may not limit the nature of the tribe's
gaming activity.
The  expansion  of gaming has also occurred in countries other than the United
States.    Numerous  countries,  including Argentina, have either adopted laws
which permit gaming, or expanded such legislation to allow private enterprises
to  operate  casinos.    As  in  the  United  States, a significant motive for
allowing  or  expanding  gaming  operations  is the revenues generated for the
government of the country in which the gaming activity is located.

FINANCIAL INFORMATION REGARDING SEGMENTS

See "Item 6.-SELECTED FINANCIAL DATA," "Item 14.-EXHIBITS, FINANCIAL STATEMENT
SCHEDULES,  AND  REPORTS  ON  FORM  8-K"  and  the  Consolidated Statements of
Operations,  page  F-3  in  the 1996 Financial Statements which accompany this
report.

DOMESTIC OPERATIONS

  CASINO MAGIC-BSL

The  casino  at  Bay  Saint  Louis, Mississippi (referred to herein as "Casino
Magic-BSL")  commenced operations on September 30, 1992, as the first dockside
casino  in  Mississippi  to  operate  on  a  barge  rather  than a traditional
riverboat.    The  casino  is  located  in  a 17-acre marina that is part of a
591-acre  Company-owned  site  located  1.5  miles  north  of U.S. Highway 90,
approximately  nine  miles  south of Interstate 10, and approximately 51 miles
east  of  New  Orleans,  Louisiana.   Casino Magic-BSL consists primarily of a
76,520  square  foot  facility with approximately 39,500 square feet of gaming
space offering 1,101 slot machines,  44 table games and poker and keno.  Other
amenities within the facility include a 330-seat buffet restaurant, an 80-seat
fine  dining  restaurant,  a  snack  bar,  a gift shop, a lounge area for live
entertainment, a customer service center and office space.  The Company owns



                                      2

<PAGE>
and  operates  the  201-room  "Casino  Magic  Inn"  at  Casino Magic-BSL which
includes  four  deluxe  suites,  20  junior  suites,  177  standard  and
handicapped-accessible  rooms, 1,500 square feet of banquet and meeting space,
2,000  square  feet  of  outdoor  terrace,  and  an  outdoor swimming pool and
Jacuzzi.  Included  at the Casino Magic-BSL complex is a 97-space recreational
vechicle  park and an 18-hole Arnold Palmer designed Championship Golf Course,
which hosts an Arnold Palmer Golf Academy.

The Company has preliminary plans for further development of Casino Magic-BSL.
These  plans include the expansion and improvement of the existing casino, and
the  construction of a second hotel with such amenities as restaurants, shops,
a  swimming pool and convention space.  There is no assurance that these plans
for further development will be implemented or completed, or that the required
funds  will  be  available  to the Company or, if available, on terms that are
acceptable to the Company.

  CASINO MAGIC-BILOXI

The  casino  at Biloxi, Mississippi (referred herein as "Casino Magic-Biloxi")
is  located  on the Gulf Coast south of and adjacent to U.S. Highway 90 in the
middle  of  a  four-casino  strip.    Biloxi is approximately 54 miles west of
Mobile,  Alabama  and  27  miles east of Bay Saint Louis, Mississippi.  Casino
Magic-Biloxi  encompasses  11 acres of land. Casino Magic-Biloxi, which opened
in  June  1993,  consists  of a 117,600 square foot facility, which contains a
47,700  square  foot,  three-level  gaming area.  The casino offers 1,196 slot
machines  and  36  table  games.  Other amenities include a 360-seat buffet, a
fine  dining  restaurant,  a  McDonald's  restaurant  operated by a franchisee
unaffiliated  with  the Company, two bars, a 250-seat lounge and entertainment
area,  a  customer  service area,  a gift shop and office space.  The property
has  an  adjacent  700-space,  eight-floor parking garage, 250 surface parking
spaces and parking for approximately 30 tour buses across U.S. Highway 90.  In
addition,  the  Company  shares  an  immediately  adjacent  430-space  parking
facility with a neighboring casino.

In December 1996, the Company commenced construction of a 378-room hotel tower
atop  its  existing parking garage at Casino Magic-Biloxi. When completed, the
hotel  is  expected  to  be  one of the tallest buildings in Biloxi. The hotel
tower  will  have  amenities  such as a swimming pool and conference space and
will include 86 suites.

Two  additional  major  casino-hotels  are  expected  to be added to the eight
casinos currently operating in Biloxi within the next year.  As competition in
the  Gulf  Coast  market  intensifies,  management believes the addition of an
on-site  hotel at Casino Magic-Biloxi will complement its central location and
strengthen its competitive position.







                                      3

<PAGE>
Although  the  Company  is taking steps to minimize the potential construction
disruption  on its existing operations at Casino Magic-Biloxi during the hotel
construction, some disruption is expected.  The Company has made provisions to
maintain  adequate  parking throughout the construction process.  Construction
of  the  hotel  is  expected  to  be  completed  in the first quarter of 1998,
although  unexpected  construction difficulties or lack of funding could delay
such completion.

  CASINO MAGIC-BOSSIER CITY
The  Company's  dockside casino at Bossier City, Louisiana (referred to herein
as  "Casino  Magic-Bossier  City"), is located on  23 acres of land on the Red
River, and is within one mile of Interstate 20.  Bossier City is approximately
180-miles east of the Dallas/Fort Worth.
In  May  1996,  Casino  Magic,  through its wholly-owned subsidiary, Jefferson
Casino  Corp.  ("Jefferson  Corp.")  acquired  Crescent  City  Development
Corporation,  ("Crescent  City")  for $50 million plus the assumption of up to
$5.7  million  in  equipment  liabilities.  Jefferson Corp paid $15 million in
cash  at  closing  and  caused  Crescent  City  to  issue $35 million of 11.5%
secured,  three  year  notes.    Crescent  City,  was the subject of a plan of
reorganization under Chapter 11 of the U.S. Bankruptcy Code in 1996, and owned
the  Crescent  City  Queen  ("Crescent  City Riverboat"), a cruising riverboat
outfitted  for  gaming.  In addition, Crescent City owned a license to conduct
riverboat  gaming operations in Louisiana, as well as gaming, surveillance and
other  gaming  related  equipment.    When  Crescent  City  emerged  from  the
bankruptcy  proceedings  in  May  1996, it was acquired by Jefferson Corp. and
renamed    Casino  Magic of Louisiana, Corp. (referred to herein as "Louisiana
Corp.")    Although Jefferson Corp. was required to purchase the Crescent City
Riverboat  to obtain the Louisiana gaming license, the Crescent City Riverboat
is one of the largest riverboats in the United States and could not be used at
Casino  Magic-Bossier  City  because  of  its  width.   Therefore, the Company
purchased  a  casino  riverboat  (the  "Bossier  Riverboat") for use at Casino
Magic-Bossier  City for $20 million.  The Company intends to sell the Crescent
City  Riverboat, and use the proceeds of such sale to assist in the funding of
the  further development of Casino Magic-Bossier City. The Company can give no
assurances  that  it  will  be  able  to  sell  the Crescent City Riverboat on
acceptable  terms or in a timely manner.  The gaming, surveillance and related
equipment  acquired  in  the  acquisition  by Jefferson Corp. is being used at
Casino  Magic-Bossier  City.    To  fund  the  initial  development  of Casino
Magic-Bossier  City,  on  August 22, 1996, Louisiana Corp. sold $115.0 million
aggregate principal amount of 13% First Mortgage Notes due in 2003.  (See Item
7  "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS - LIQUIDITY AND CAPITAL RESOURCES.")


                                      4

<PAGE>

The  Company  opened  Casino  Magic-Bossier  City  on  October 4, 1996 using a
temporary  boarding  facility,  and on December 31, 1996, opened the permanent
facility.    The  Company's  plans for the development of Casino Magic-Bossier
City  are  divided  into  two phases.  The first phase (which was completed on
December  31,  1996)  included construction of the existing 30,000 square foot
floating  dockside  casino,  a  37,000  square  foot  entertainment,  food and
beverage  pavilion,  a  four  story  1,500  space  parking garage, and surface
parking  for  400  cars.  The second phase plans include the construction of a
60,000  square  foot  entertainment facility and a 400-room convention hotel.
The  hotel  is  expected  to  house  restaurants,  banquet space, a theater, a
swimming  pool,  a health club and a child-care facility.  The development and
construction  of  the  second  phase  improvements  are largely dependent upon
receipt  of  proceeds  from  a  future sale of the Crescent City Riverboat and
future  operating  cash  flow  of  Casino  Magic-Bossier  City.    There is no
assurance that such funds will become available or that such hotel and related
facilities will ever be developed.

  GOLDIGGERS SALE

On  June  13,  1996,  the  Company  sold the capital stock of Atlantic-Pacific
Corp.,  which  operates  "Goldiggers," a small casino-hotel in Deadwood, South
Dakota,  with  approximately  8,500  square feet of gaming area and nine hotel
rooms.    Management's  decision to sale Goldiggers was based on its continued
disappointing  operating  results  and negative cash flow.  At the date of the
sale, June 13, 1996, Goldiggers had accumulated losses of $1.8 million.

  CASINO MAGIC-NORTH DAKOTA

The  Company,  through  a  wholly-owned  subsidiary, entered into a consulting
agreement  with  the  Sisseton-Wahpeton  Dakota Nation ("Sisseton") to provide
consulting  services to Sisseton concerning the operation of a casino facility
on  Tribal  land  located  adjacent to Interstate 29, 75 miles north of Fargo,
North  Dakota.    The  Company began providing these services in November 1996
after  the  opening  of a temporary casino facility. Under this agreement, the
Company  will  provide consulting services to Sisseton for a minimum period of
two  years.    The  fee  for  these services is based on gross revenues of the
casino facility.

It  is  anticipated  that Sisseton will contruct a permanent casino which will
consist  of  approximately  25,000  square  feet  of  gaming space housed in a
facility totaling approximately 60,000 square feet.  Casino Magic-North Dakota
is  operates approximately 1,000 gaming positions, including 600 slot machines
and  40  table  games,  including  poker,  blackjack,  craps,  mini-baccarat,
Caribbean  Stud  Poker  ,  and other popular games.  Casino Magic-North Dakota
plans  for  the  future  a  live keno parlor, a race book and a limited sports
book.    Future  plans  also  include a construction of a 200-room hotel and a
recreational  vehicle park.  Development of the project is subject to Sisseton
obtaining additional financing.





                                      5

<PAGE>

  INTERNATIONAL OPERATIONS.

The  Company  has  in  the  past  pursued  the management and the operation of
casinos  and  related  entertainment facilities outside of the United States.
With  the  shift  of  the  Company's  focus,  the  Company does not anticipate
pursuing  similar  arrangements in the foreseeable future.  The following is a
summary  of  the  Company's  current  and  recently  terminated  international
operations.

  CASINO MAGIC-ARGENTINA

In  December  1994,  the  Company, through its wholly-owned subsidiary, Casino
Magic Neuqu n S.A., began gaming operations in the Argentine cities of Neuqu n
and  San  Mart  n  de  los  Andes.  The largest casino, located in the city of
Neuquen,  has approximately 27,000 square feet of gaming space and contains 40
table  games,  342  slot  machines and a 384-seat bingo facility.  The smaller
casino  in  San  Mart  n  de  los  Andes,  a  ski town approximately 200 miles
southwest of Neuquen City has approximately 2,000 square feet of gaming space,
53  slots  and 14 table games. The Company has unrestricted rights to increase
the number of gaming positions at both locations although the Company does not
anticipate significant additional investment in Casino Magic-Argentina.  Prior
to  December  1994,  the  two  casinos were operated by the Neuquen provincial
government.

  CASINO MAGIC-PORTO CARRAS SALE

At September 30, 1996, management determined that its 49% equity investment in
Porto  Carras Casino S.A.("Porto Carras, S.A."), was impaired. Because of this
impairment, management wrote off its equity investment in Porto Carras, S.A.,
including  all  unpaid  notes  and  receivables  from  Porto  Carras,  S.A..
Management's  decision  was  based  on   results from Porto Carras, S.A. after
Hyatt  Corporation  opened  a  new  casino  in  September  1996 in the City of
Thessaloniki,  Porto  Carras's  primary  market.  The Greek Government allowed
Hyatt  Corporation  to  charge an $8 admission tax compared to a $20 admission
tax  required  to  be  paid  by  Porto  Carras,  S.A.    Although  the Company
anticipated  some  revenue  loss as a result of this increased competition and
admission  fee  differential,  the  actual  effects  were  much  greater  than
anticipated  and  resulted  in  an  approximate $2.0 million operating loss at
Porto  Carras  for the month of September 1996. Despite new marketing and cost
containment  efforts,  these  losses continued.  Furthermore, the 51% owner of
Porto  Carras  was unwilling or unable to advance any funds to the operation.
Additionally,  the majority owner  informed the Company that it did not intend
to  operate  a substantial portion of the Porto Carras resort area, consisting
of  two  hotels  and  amenities, during the 1997 season.  These factors, among
others,  led the Company to the decision to divest itself of its investment in
Porto Carras Casino S.A. in December 1996.
In  addition  to  management's  decision  to sale Porto Carras, all management
agreements  in  effect  to  operate other casinos in Greece were terminated in
December 1996.




                                      6

<PAGE>

FUTURE DEVELOPMENT

  INDIANA

Casino  Magic,  through  its  wholly owned subsidiary, Crawford County Casino,
Corp. (" Indiana Corp.") is one of two applicants for the tenth gaming license
expected  to  be  issued  in the State of Indiana.  If successful in obtaining
this  gaming  license,  the  Company  plans  to develop a riverboat casino and
entertainment  facility  at  a  160-acre  site  on  the Ohio River in Crawford
County,  Indiana.   As part of the development, it is anticipated that Indiana
Corp.  would purchase the Crescent City Riverboat from Louisiana Corp. for use
at its Indiana gaming operation and move the boat to the Crawford County site.
 The  Crescent  City  Riverboat is one of the largest gaming riverboats in the
U.S.,  measuring  approximately  430  feet  by  100 feet, with a total area of
88,000 square feet on three decks.  The Company estimates that it will require
approximately $60 million to develop, contruct and equip a land-based facility
to support the riverboat casino, including a 250-room hotel, a restaurant, and
entertainment and parking facilities.  The Company can give no assurances that
a  gaming  license will be obtained in Indiana, or if obtained that sufficient
capital to fund the Indiana project will be available.

  NEW HAMPSHIRE

In  May  1995,  the  Company  entered  into  an  agreement with Lakes Regional
Greyhound Park ("LRGP").  Under the terms of the Agreement, the parties intend
to  form  an entity to pursue a gaming development at LRGP's pari-mutual track
in  Belmont,  New  Hampshire,  if  gaming  is legalized in New Hampshire.  The
entity  will  be  equally  owned by the Company and LRGP, and the Company will
manage  gaming  operations.    Under  the  agreement with LRGP, the Company is
obligated  to  provide  up  to  $4  million in funding, $3 million of which is
subject  to  certain  contingencies  including  the  passage  of  legislation
permitting  gaming at racetracks in New Hampshire.  There is no assurance that
the Company will have the funds to pursue such gaming opportunity.
  OTHER

The  Company  has  purchased land and acquired options to lease land in states
which  have  not legalized gaming activities.  There can be no assurances that
gaming  will  be  legalized  in  these  states.  The  cost of options and land
deposits  are being amortized over the life of the option or deposit. However,
if  a  determination  is  made  that  a permanent impairment has occurred, the
option or deposit is written down to its net realizable value.










                                      7

<PAGE>
  MARKETS AND MARKETING

  CASINO MAGIC-BSL AND CASINO MAGIC-BILOXI MARKETS

Casino  Magic-BSL  and  Casino  Magic-Biloxi  are  two  of  the ten casinos in
operation  in  the  Mississippi  Gulf  Coast market.  Approximately 70% of the
customers of these two casinos reside within 150 miles of the two sites.  This
primary  market  area  includes  a  population  of  an  estimated  4.5 million
residents.    New  Orleans is approximately 51 miles west of Casino Magic-BSL,
and  Mobile,  Alabama  is approximately 54 miles east of Casino Magic-Biloxi.
Previously, the market range was limited due to the lack of overnight, on-site
accommodations  on  the  Mississippi  Gulf Coast.  The opening of the 201-room
Casino  Magic  Inn  at  Casino Magic-BSL has allowed the Company to expand its
market  range  beyond  the traditional 150-mile range.  With the completion of
the  golf  course  in  Casino  Magic-BSL  (opened  February  19, 1997) and the
anticipated  completion  in 1998 of the Casino Magic-Biloxi hotel, the Company
expects to draw additional visitors from areas outside the 150-mile radius.

The  major  market  for Casino Magic-BSL is approximately 51 miles away in the
greater  New  Orleans metropolitan area where over 1.5 million adults reside.
In  addition  to  local residents, Casino Magic-Biloxi attracts customers from
Mobile,  Alabama, and Pensacola, Florida.  The Mobile-Pensacola region is home
to  over  1,000,000  adult.  Mobile and the Florida Panhandle area account for
nearly  half  of  Casino  Magic-Biloxi's  customers.    In  addition,  Casino
Magic-Biloxi's location in the middle of the Biloxi Strip better enables it to
attract  customers  from surrounding casinos.  Local gaming industry marketing
surveys  have  indicated  the  typical  non-resident gaming customer visits an
average of three casinos.

CASINO MAGIC-BOSSIER CITY MARKET

Casino  Magic-Bossier  City  is  one  of  our  four  casinos  operating in the
Shreveport/Bossier  City,  Louisiana  metropolitan area.  Casino Magic-Bossier
City's  primary market is  the 6.8 million adults residing within 200 miles of
Bossier  City, including persons residing in the Dallas-Forth Worth area which
is  located approximately 180 miles west of Casino Magic-Bossier City.  Casino
Magic-Bossier City's location will provide customers from the Dallas-FortWorth
market  easy and direct access from Interstate Highway 20, the major east-west
artery  connecting Dallas-Fort Worth to Bossier City.  Other cities within 200
miles  of  Casino  Magic-Bossier  City  include  Longview,  Texas, and Monroe,
Louisiana.




                                      8

<PAGE>

  DOMESTIC MARKETING

The  Company's  marketing programs consist of a variety of advertising, direct
mail  and promotional programs intended to encourage more repeat visits to the
Company's  facilities.    The  Company's  domestic  marketing  efforts include
newspaper  and  direct  mail  advertising  of  its  Magic Money Player's Club,
special  promotions, events and entertainment, and a motor coach program.  The
Magic  Money Players Club is the most important marketing tool utilized by the
Company.    Like  a  frequent  flier airline card or cash back credit card, it
promotes  customer  loyalty  and frequent use.  Guests who enroll in this free
club  complete  a  questionnaire  that  provides  the  Company  with  useful
demographic  information.    Specific  groups  can be targeted for direct-mail
offers  and  promotions,  and  each  member  of  the  Magic Money Players Club
receives  a bi-monthly newsletter that includes upcoming events, entertainment
schedules, current membership incentives and photos of recent winning patrons.
 The  Magic  Money Players Club also provides benefits to the customer such as
cash  rewards,  club  perquisites  and  a  sense of belonging.  Because gaming
members earn points that are redeemable for cash, the Magic Money Players Club
provides  an  effective way to give back to loyal customers a portion of their
play.    The  reward  levels  are viewed as goals for the member and therefore
increase  length  of  stay  and frequency of visits.  Active members with high
play  levels  are  also  rewarded  with  complimentary entertainment and event
tickets  as  well  as free dining and lodging.  Since other commpeting casinos
have  similar  "clubs",  the  preceived  quality of such clubs is an important
marketing factor.

The  Company  schedules  mid-week  gaming  promotions  to add to the Company's
customer base, generate more frequent visits from its existing customers base,
and  increase the length of customer stay and play levels.  In addition Casino
Magic-BSL  normally  hosts four nationally televised boxing events per year to
increase  national  exposure.  Local  advertising  and direct mail are used to
target  the  player  base  and  the  general  public  for  large  promotions.
Additional  direct-mail  offers, including gaming packages, car drawings, free
buffets,  event  tickets and party invitations, are sent to high-end players.
Every  promotion  is  monitored  through the Magic Money Players Club for cost
effectiveness.    The  success  of  each  promotion not only depends on player
appeal, but also the level of internal and external advertising related to the
promotion.

Casino  Magic-BSL  and  Casino  Magic-Biloxi  also actively promote motorcoach
group  package  programs.  The "Magic Bus" program is available Sunday through
Thursday  and  includes  a  free bus trip to the property, a free breakfast or
lunch  and  other  benefits.    Intended  to  maintain  customer volume during
traditionally  non-peak times, Magic Bus programs originate at locations 50 to
150  miles  from  the  properties,  are completed in one day and are generally
organized  by  one  of  the  participants.  Professional  tour  operators also
organize  bus  trips which originate at locations more than 250 miles from the
coast.    These motorcoach groups will typically spend one or more nights away
from  home.   Currently, Casino Magic-BSL and Casino Magic-Biloxi welcome over
10,000  motorcoach  passengers  each month.  The motorcoach program experience
that  the  Company  has  gained  in  Mississippi  will  be  beneficial for the
development of a similar program at Casino Magic-Bossier City.


                                      9

<PAGE>

The  Mississippi  Gulf  Coast provides 35 miles of sandy beaches, and the area
offers  a  variety of outdoor activities, including boating, sport fishing and
golf. The Company's advertising, coupled with other casinos' marketing efforts
and  marketing campaigns by local tourism promotion agencies, promote the area
as  a  desirable  recreational  and  gaming  location.  It is hoped that these
activities  will  have the affect of increasing the volume of compensating for
future  expansion  of  existing  and  new  gaming  facilities  in Mississippi,
Louisiana  and neighboring states.


The Company recently established a new marketing research and analysis program
 to  provide  the  Company  with objective information related to competition,
market  potential,  program  profitability, customer attitudes and advertising
effectiveness.    The  department  is responsible for conducting  monthly exit
surveys  to measure customer satisfaction, analyze the appeal of casino events
and  promotions,  evaluate  current  competitive  factors  and  measure  the
effectiveness of various advertising and promotional efforts.

CASINO MAGIC-ARGENTINA

The two casinos comprising Casino Magic-Neuquen are in the Province of Neuqu n
located  in  west-central Argentina.  The population within a 150-miles radius
of  those  two cities is approximately 900,000.  The cities of Neuqu n and San
Mart n de los Andes are located near a number of Argentine tourist attractions
including  national  parks,  ski  resorts  and  a  wide  variety  of  outdoor
activities.    The  two  cities have a combined total of more than 5,000 hotel
rooms.    The  San  Mart n de los Andes casino was moved in December 1995 to a
location  in  the  heart of the city.  The Company believes that this move has
resulted in an increase in business.

SEASONALITY

The  Company's  current gaming operations on the Mississippi Gulf Coast and in
Bossier  City,  Louisiana,  are subject to seasonal variation. Gaming revenues
typically  decline  during  the  third  and  fourth  quarters of the year. The
operations  of  Casino  Magic-Argentina,  also  experience  similar  seasonal
variation due to reliance on tourism.

COMPETITION

  GENERAL

The  Company  has  experienced intense competition due primarily to the recent
and  significant  expansion  of gaming on the Mississippi Gulf Coast.  Many of
the  Company's  competitors  have  greater  name  recognition,  marketing
capabilities  and  financial resources.  In attempting to attract customers to
its  casinos,  the Company faces, or may face, increasing competition from new
casinos developed on the Mississippi Gulf Coast, in Northwest Louisiana and in
surrounding market areas, and from established gaming centers such as those in
Nevada and Atlantic City, New Jersey.  The Company also faces competition from
other  forms  of  lawful  gaming,  such as state-sponsored lotteries and video
lottery  terminals,  pari-mutuel  betting  on  horse and dog racing, and bingo
parlors  as  well  as  from other forms of entertainment.  It is possible that
increased competition could have a material adverse effect on the Company.
                                     10

<PAGE>

  CASINO MAGIC-BSL AND CASINO MAGIC-BILOXI

The  Mississippi  gaming  market is highly competitive.  The Company's current
Mississippi  operations  compete  primarily  with  nine  other dockside gaming
casinos  on  the  Mississippi  Gulf Coast, all of which have been opened since
August  1992.    Seven  competing facilities are located in Biloxi and two are
located  in  Gulfport,  approximately  10 miles from Biloxi.  In addition, the
Company  believes  that  many  of  its  competitors  will add or enhance their
existing  amenities  and  competitors  will  enter  the Mississippi Gulf Coast
market.    Mirage  Resorts,  Inc.  has  begun construction and has  received a
gaming  license  to  open  a  casino and resort complex in Biloxi in 1998.  In
addition,  the  "Imperial  Palace"  casino  is  currently scheduled to open in
Biloxi  in  July 1997.  Both such developments include substantial hotels with
1,000  or  more  rooms  each.  Both Circus Circus and Hilton are attempting to
develop casino resorts off of Interstate 10 in Bay Saint Louis just across the
bay  and  north  of Casino Magic-BSL.  Both casinos, if developed, may be more
easily  accessed  by customers coming from New Orleans, than Casino Magic-BSL.
Intense  competition  on  the  Mississippi  Gulf  Coast has contributed to the
closure  of  two  gaming  facilities  in that area, and one other is operating
under  bankruptcy  protection.  Mississippi  law  does not limit the number of
gaming  licenses  that  may  be granted.  Any increase in the number of gaming
facilities along the Mississippi Gulf Coast and surrounding areas could have a
material adverse effect on the Company.

  CASINO MAGIC-BOSSIER CITY

There  are currently fourteen riverboat casinos operating in Louisiana, all of
which  have opened since September 1993.  Of these fourteen riverboat casinos,
four  are currently licensed and operate in the Bossier City/Shreveport market
and  offer substantially similar gaming facilities.  Casino Magic-Bossier City
faces  competition  from those existing operations, particularly to the extent
that  they  add  to  or  enhance  existing  amenities.   For example, Binion's
Horseshoe Casino has begun construction  of a 606-room all suites hotel at its
riverboat  casino  location in Bossier City.  In addition, one riverboat owned
by  Hilton  Corporation  currently  operating  in  the  New Orleans market has
received  approval  to  relocate to the Bossier City market in late 1997 and a
sixth  gaming  company,  Hollywood  Casino,  has received approval to obtain a
license  to operate a dockside riverboat casino in the Bossier City/Shreveport
area thus increasing competition in this area.

  TEXAS AND ALABAMA LEGALIZATION RISKS

Casino  gaming  is  currently  prohibited in several jurisdictions adjacent to
Louisiana  and  Mississippi.    As a result, residents of these jurisdictions,
principally Texas and Alabama, comprise a significant portion of the customers
of Casino Magic-BSL, Casino Magic-Biloxi and Casino Magic-Bossier City.




                                      11

<PAGE>

Although  casino  gaming  is  not  currently  permitted in Texas and the Texas
Attorney  General  has issued an opinion that gaming in Texas would require an
amendment  to  the  Texas  Constitution,  the Texas Legislature has considered
various  proposals  to  authorize  casino  gaming.   No gaming legislation was
enacted  in  the  most  recent  legislative  session  ended  May  29, 1995.  A
constitutional  amendment would require a two-thirds vote of those present and
voting  in  each house of the Texas Legislature and approval by the electorate
in  a  referendum.  The legalization of casino gaming in Texas and the opening
of  one or more casinos in the Dallas/Fort Worth area, which is a major market
for  Bossier  City/Shreveport gaming operations, would have a material adverse
effect on Casino Magic-Bossier City operations.

Casino  gaming  is  currently  illegal  in  Alabama  due  to  a constitutional
prohibition  against  lotteries.    Several  attempts have been made to pass a
resolution  of the Alabama Legislature providing for a statewide referendum on
the  repeal  of  the pertinent section of the Alabama Constitution prohibiting
lotteries (and thereby gaming).  This action would require a three-fifths vote
of each house of the legislature followed by a statewide referendum.  Both the
Governor  and  the Attorney General of Alabama have stated their opposition to
the  legalized  casino  gaming  even  though  pari-mutuel wagering and limited
charitable bingo exist within the state.  The legalization of casino gaming in
Alabama  would  have  a  material  adverse effect on the Company's Mississippi
operations,  particularly  Casino  Magic-Biloxi,  both  because  the  Mobile
metropolitan  area  is  a  major  market for the Company's Casino Magic-Biloxi
operation  and  because  a  substantial portion of the Company's customers are
residents of areas east of Mobile including Florida and Georgia.

     ARGENTINA

The  Company's  two  casinos in the Province of Neuqu n, Argentina, located in
the  cities  of  Neuqu  n  and  San Mart n de los Andes are currently the only
operating  casinos  in  the  Province  of  Neuqu  n.    There are, however, 44
government-operated  casino  operations  throughout  the  country, including a
casino  in Chipolletti, across the Rio Negro River from the City of Neuquen in
Rio  Negro Province, and a casino in Rio Negro Province approximately 30 miles
southeast  of  the city of Neuqu n.  The Company's exclusive concession in the
Province of Neuqu n is the second out of 12 which have been or will be awarded
under the Argentine government's casino privatization program.

GOVERNMENT REGULATION

  DOMESTIC

The  ownership  and  operation  of  a casino gaming business within the United
States  and  other  jurisdictions in which the Company operates are subject to
extensive and complex governmental regulation and control under federal, state
or  local  laws  and  regulations.   These laws and regulations are subject to
change  including  the  repeal  of  laws which permit gaming.  The Company and
certain  of  its  officers,  directors,  key employees, shareholders and other
affiliates  ("Regulated  Persons")  are subject to strict legal and regulatory
requirements,  including  mandatory  licensing  and  approval  requirements,
suitability  requirements,  and  ongoing  regulatory oversight with respect to
such  gaming operations.  Such legal and regulatory requirements and oversight
will  be  administered  and  exercised  by  the  relevant regulatory agency or
agencies in each jurisdiction.
                                      12
<PAGE>

The  Company  and  the  Regulated  Persons will need to satisfy the licensing,
approval  and  suitability  requirements  of  each  jurisdiction  in which the
Company seeks to become involved in gaming operations.  Such requirements vary
from  jurisdiction  to jurisdiction, but generally concern the responsibility,
financial  stability  and  character  of  the  owners  and  managers of gaming
operations,  as  well  as  persons  financially  interested  or  involved  in
operations.    In  general,  the procedures for gaming licensing, approval and
findings  of suitability require that the Company and each Regulated Person to
submit  detailed  background  and  financial  information and that the Company
demonstrate  that  the  proposed  gaming  operation  has  adequate  financial
resources  generated  from  suitable sources and adequate procedures to comply
with  the operating controls and requirements imposed by law and regulation in
each  jurisdiction.    This  submission  is  normally  followed  by a thorough
investigation  by  the  regulatory  authorities. An application for any gaming
license,  approval  or finding of suitability may be denied for any cause that
the  regulatory  authorities  deem reasonable.  There can be no assurance that
the  Company  or  the  Regulated  Persons  will  obtain or maintain all of the
necessary  licenses,  approvals  and  findings  of  suitability  to permit the
Company  to  continue  its  development  plans.  Once a license or approval is
obtained,  the  Company  will  be  required  to  periodically  submit detailed
financial  and operating reports to regulatory authorities.  Such licenses and
approvals  may  be  subject  to  periodic  renewal  and  generally  are  not
transferable.    The  regulatory  authorities may at any time revoke, suspend,
condition,  limit  or  restrict a license, approval, or finding of suitability
for  any  cause  they  deem  reasonable.    Fines for violations may be levied
against  the  holder  of  a license and in some jurisdictions gaming operation
revenues can be forfeited to the state under certain circumstances.  The laws,
regulations  and  procedures  pertaining  to  gaming  are  subject  to  the
interpretation  of the regulatory authorities and may be amended.  Any changes
in  such  laws  or regulations, or their current interpretations, could have a
material adverse effect on the Company.

  MISSISSIPPI GAMING REGULATIONS
In  1990,  the  State  of  Mississippi  legalized  dockside  casino gaming for
counties along the Mississippi River and the Gulf Coast.  The legislation gave
each  of  those  counties  the  opportunity to hold a referendum on whether to
allow  dockside  casino gaming within its boundaries.  Mississippi law permits
gaming licensees to offer unlimited stakes gaming on a 24-hour basis.  The law
does  not  restrict  the amount or percentage of space on a vessel that may be
utilized  for  gaming.    The  legislation  also  does not limit the number of
licenses that the Mississippi Gaming Commission (the "Mississippi Commission")
can  grant  a  particular  area  and  does  not impose different conditions on
different licensees.

The  ownership  and  operation  of casino gaming facilities in Mississippi are
subject  to  extensive  state  and local regulation.  The Company, through its
subsidiaries,  holds  licenses  for  Casino  Magic-Biloxi and Casino Magic-BSL
under  the  Mississippi  Gaming  Control  Act  (the  "Mississippi Act").  Each
license  is  site  specific.    The  Company's  current  and  proposed  gaming
operations  are  subject  to  the  licensing  and  regulatory  control  of the
Mississippi  Commission and various federal, state, county and city regulatory
agencies.    The  Mississippi Commission adopted regulations in furtherance of
the  Mississippi  Act.   These regulations have been amended from time to time
since that date.
                                      13

<PAGE>
The  Company  is  required  to  submit detailed financial, operating and other
reports to the Mississippi Commission.  Substantially all loans, leases, sales
of  securities  and similar financing transactions entered into by the Company
must be reported to or approved by the Mississippi Commission.  The Company is
also  required to periodically submit detailed financial and operating reports
to  the  Mississippi  Commission  and  furnish any other information which the
Mississippi Commission may require.

Each  of  the directors, officers and certain key employees of the Company who
are  actively  and  directly  engaged  in the administration or supervision of
gaming,  or  who have any other significant influence on the activities of the
Company, must be found suitable therefor and may be required to be licensed by
the  Mississippi  Commission.    In  practice,  a finding of suitability of an
individual  is  considered the same as licensing that individual.  The finding
of  suitability requires submission of detailed personal financial information
followed by a thorough investigation.  Although certain current members of the
Company's management have been found suitable in connection with the licensing
of  the  Casino  Magic-Biloxi  and Casino Magic-BSL, there can be no assurance
that  additional key personnel or management persons who may be recruited from
time  to  time  by  the  Company  will  be  found  suitable by the Mississippi
Commission,  if  the Mississipi Commission were to find a director, officer or
key  employee  unsuitable  for  licensing  or  unsuitable to continue having a
relationship  with the Company, the Company would have to suspend, dismiss and
sever  all  relationships  with  such  person.  The Company would have similar
obligations  with  regard  to  any  person  who  refuses  to  file appropriate
applications.    Each  gaming  employee  must  obtain  a  work  permit.    The
Mississippi  Commission may refuse to issue a work permit to a gaming employee
for  various  grounds  enumerated  in  the  Mississippi  Act, including if the
employee  has committed larceny, embezzlement or any crime of moral turpitude,
or  knowingly  violated the Mississippi Act or Mississippi regulations, or for
any  other  reasonable  cause.    Denial  of a work permit is mandatory if the
applicant has committed, attempted or conspired to commit a felony.

The  licenses  obtained  by  the  Company  have terms of two years and are not
transferable.    New  licenses  must  be  obtained at the end of each two-year
period.    There  can  be no assurance that new licenses can be obtained.  The
Mississippi  Commission  has  the  power to deny, limit, condition, revoke and
suspend  any  license, finding of suitability or registration, and to fine any
person  as  it  deems  reasonable  and  in  the public interest, subject to an
opportunity  for  a hearing.  The Mississippi Commission may fine any licensee
or  other person who is subject to the Mississippi Act up to $100,000 for each
violation  of  the  Mississippi  Act,  which  is  the  subject  of  an initial
complaint,  and up to $250,000 for each such violation which is the subject of
any  subsequent complaint. The Mississippi Act provides for judicial review of
certain  decisions  of the Mississippi Commission by petition to a Mississippi
circuit  court,  but the filing of such petition does not necessarily stay any
such  action  taken  by  the  Mississippi Commission pending a decision by the
circuit court.







                                      14

<PAGE>
Any  individual  who  is found to have a material relationship to, or material
involvement  with, the Company or, in the discretion of the Gaming Commission,
any other person associated with a gaming establishment of the Company, may be
required to be investigated in order to be found suitable or to be licensed as
a  business  associate  of the Company.  Key employees, controlling persons or
others  who  exercise  significant influence upon the management or affairs of
the Company may also be deemed to have such a relationship or involvement.

The  Mississippi  Act  requires  that owners of more than 10% of the Company's
voting  securities  be  found  suitable  by  the  Mississippi Commission.  The
statutes  and  regulations also give the Mississippi Commission the discretion
to  require  a  suitability  finding  with  respect to anyone who acquires any
security  of  the  Company  regardless  of  the  percentage of ownership.  The
current policy of the Mississippi Commission is to require anyone acquiring 5%
or more of any voting securities to be found suitable.  If the owner of voting
securities  who is required to be found suitable is a corporation, partnership
or trust, it must submit detailed business and financial information including
a  list  of  beneficial owners.  The applicant is required to pay all costs of
investigation.

Any owner of voting securities who is found unsuitable and who holds, directly
or  indirectly,  any  beneficial  ownership of equity interests in the Company
beyond  such period of time as may be prescribed by the Mississippi Commission
may be guilty of a misdemeanor.  Additionally, any person who fails or refuses
to  apply for a finding of suitability or a license within 30 days after being
ordered  to  do so by such Commission may be found unsuitable.  The Company is
subject  to  disciplinary action if, after it receives notice that a person is
unsuitable  to  have  any  relationship  with  it,  the  Company  (i) pays the
unsuitable  person  any  distributions  or interest upon any securities of the
Company  or  any  payments  or  distribution  of  any  kind  whatsoever,  (ii)
recognizes  the  exercise, directly or indirectly, of any voting rights in its
securities  by  the unsuitable person, or (iii) pays the unsuitable person any
remuneration in any form for services rendered or otherwise, except in certain
limited and specific circumstances.

The  Company  will be required to maintain current equity ownership ledgers in
the  State  of Mississippi which may be examined by the Mississippi Commission
at any time.  If any securities are held in trust by an agent or by a nominee,
the  record  holder may be required to disclose the identity of the beneficial
owner to the Mississippi Commission.  A failure to make such disclosure may be
grounds  for  finding  the  record  holder  unsuitable.    The Company also is
required  to  render  maximum  assistance  in  determining the identity of the
beneficial owner.

The  Mississippi Act requires that certificates representing equity securities
of  the  Company  bear  a legend to the general effect that the securities are
subject to the Mississippi Act and regulations of the Mississippi Commission.
The Mississippi Commission has the authority to grant a waiver from the legend
requirement,  which  the Company has obtained.  The Mississippi Commission has
the  power  to  impose additional restrictions on the holders of the Company's
securities at any time through its power to regulate licenses.




                                      15

<PAGE>
The  regulations provide that a change in control of the Company may not occur
without  the  prior  approval  of the Mississippi Commission.  Mississippi law
prohibits  the Company from making a public offering of its securities without
the  approval of the Mississippi Commission if any part of the proceeds of the
offering  is  to be used to finance the construction, acquisition or operation
of  gaming  facilities  in  Mississippi,  or  to  retire or extend obligations
incurred for one or more of such purposes.

The  Mississippi  Commission  has  enacted  regulations  requiring  that, as a
condition  to  licensure  or renewal licensure, an applicant provide a plan to
develop "infrastructure facilities" amounting to 25% of the cost of the casino
and  a  parking  facility  capable of accommodating 500 cars.  "Infrastructure
facilities"  include  any of the following: a 250-room hotel, theme park, golf
course,  marina,  tennis  complex,  or  any  other  facilities approved by the
Mississippi  Commission,  but  such  team does not include parking facilities,
roads,  sewage  and  water  systems  or  civic  facilities.    The Mississippi
Commission  may  reduce  the  number of rooms required in a hotel, where it is
shown  to the satisfaction of the Mississippi Commission that sufficient rooms
are available to accommodate the anticipated number of visitors.

The Company's future gaming operations outside of Mississippi are also subject
to approval by the Mississippi Commission.

  LOUISIANA GAMING REGULATIONS

In 1991 the Louisiana legislature enacted the Louisiana Riverboat Economic and
Gaming  Control  Act,  LSA-R.S. 4:501, et. seq. (the "Louisiana Gaming Act").
The  Louisiana  Gaming  Act authorized the licensing of up to 15 riverboats to
conduct  gaming on designated rivers and waterways.  Pursuant to the Louisiana
Gaming  Act, the Riverboat Gaming Commission (the "Louisiana Commission"), was
created  within  the Department of Public Safety and Corrections for the State
of  Louisiana.    Additionally, a riverboat gaming regulatory group within the
Louisiana  State  Police was created.  The Louisiana Gaming Commission and the
State  Police  were  authorized  to  and did promulgate the existing rules and
regulations governing the licensing and operations of riverboats.

The  Louisiana  legislature  in the First Extraordinary Session, 1996, enacted
new  legislation  (the "Louisiana Board Act") which transferred the regulatory
oversight  of most gaming operations in Louisiana, including riverboat gaming,
to  the  Gaming  Control Board (the "Louisiana Board"), effective as of May 1,
1996.    The  Louisiana  Commission  was  abolished as of that same date.  The
Louisiana  Board  will  consist  of  nine members appointed by the Governor of
Louisiana.    As  of  December  31, 1996, the chairman and five members of the
Louisiana  Board have been appointed, which constitutes a quorum necessary for
the  Louisiana  Board  to  conduct  business.    At  the  first meeting of the
Louisiana  Board, which was held on July 19, 1996, the Louisiana Board adopted
an  internal  board  policy,  a travel policy, a declaration of emergency, and
emergency  rules  101  through  104.    Rule  101  provides definitions of the
Louisiana  Board, the Chairman of the Louisiana Board (the "Chairman") and the
Department  of  Public  Safety  (the  "Department").   Rule 102 authorizes the
Department  to  issue  to qualified applicants non-key gaming employee permits
and  non-gaming  vendor  licenses  and  to renew licenses for the operation of
video poker devices at facilities with no more than three video poker devices.


                                      16

<PAGE>
Rule  102  further  authorizes  the  Department  to  determine  an applicant's
qualifications  in  accordance with the current laws.  Rule 103 put in place a
procedure for appeals by applicants whose renewals have been denied.  Finally,
Rule  104  is  a  general  delegation of power to the Chairman to exercise all
posers and authority of the Louisiana Board, except the Chairman shall not:

1.     enter into contracts in excess of $100,000;
2.     adopt rules:
3.     enter into the casino operating contract on behalf of the Louisiana
       Board;
4.     issue a riverboat gaming operator license, provided that the Chairman
       may determine that conditions imposed on a conditionally licensed
       riverboat gaming operator have been met;
5.     approve changes of the berth or design specifications of a riverboat;
       or
6.     approve transfers of ownership interests in a riverboat gaming operator
       licensee, the casino gaming operator, or a qualified video-poker
       truck-stop facility.

The  Louisiana  Board is empowered to regulate four forms of gaming activities
and  operations in the state: riverboat, video poker, the land-based casino in
New  Orleans,  and all state regulated aspects of Indian gaming.  (Excluded is
the  regulation and oversight of horse racing and off-track betting, the state
lottery,  and  charitable  gaming.)   Accordingly, the Louisiana Board has all
regulatory  authority,  control,  and  jurisdiction,  including investigation,
licensing,  and enforcement, and all power incidental to or necessary for such
regulatory  authority,  control  and  jurisdiction, over all aspects of gaming
activities  and  operations  as  authorized  pursuant to the provisions of the
Louisiana  Gaming  Act,  the  Louisiana  Economic  Development  and  Gaming
Corporation  Act  (Land-Based Casino in New Orleans), and the Video Draw Poker
Devices Control Act.

The Louisiana Board has been authorized to promulgate rules and regulations to
govern the aforesaid types of gaming in Louisiana; however, all administrative
rules  and  regulations  promulgated  by  entities  whose  powers  have  been
transferred  to  the  Louisiana Board are to be considered valid and remain in
effect until repealed by the Louisiana Board.

The construction, ownership and operation of riverboat gaming vessels will now
be  subject  to  regulation by the Louisiana Board.  The independent authority
previously  granted  to  the State Police by the Louisiana Gaming Act has been
significantly  reduced  by  the Louisiana Control Board Act.  The State Police
will  now  conduct  investigations  and audits regarding the qualifications of
applicants  for  licenses  or  permits  requiring  suitability determinations,
submit  all  investigative  reports  to the Louisiana Board, conduct audits to
assist  the  Louisiana Board, issue certain licenses and permits in accordance
with  rules  adopted  by the Louisiana Board, and perform all other duties and
functions  necessary  for the efficient and thorough regulation and control of
gaming activities and operations under the Louisiana Board's jurisdiction.






                                      17

<PAGE>
The  Louisiana Board Act did not repeal the Louisiana Gaming Act, the original
1991  statute authorizing riverboat gaming in Louisiana, but rather amended it
to  transfer  licensing and regulatory authority to the Louisiana Board and to
redefine  the  authority  of the State Police.  Otherwise the Louisiana Gaming
Act  remains  in  effect.   Accordingly, the Louisiana Gaming Act continues to
authorize  up  to 15 licenses to conduct gaming activities on riverboats, with
no  more  than  six  licenses to be granted to riverboats operating in any one
parish.

Local  regulation  remains restricted to the imposition of an admission fee of
up  to  $2.50  per  passenger  ($3.00  per passenger in Shreveport and Bossier
City).

On  November  5,  1996,  voters  in both Caddo and Bossier parishes approved a
continuation  of  riverboat  gaming  in  such  parishes.   Voters in all other
Louisiana  parishes  in  which  riverboat  gaming  is currently conducted also
approved  a continuation of that form of gaming in their respective parishes.
Current  Louisiana  law  limits the number of riverboat casino licenses in the
state  to  15, all of which have been awarded, and limits the concentration of
riverboat  casino  licenses  in  any one parish to six.  Six of those licenses
(including  the  Company's,  another recently approved relocation from the New
Orleans  market) have been granted in the Bossier City/Shreveport market which
encompasses  both  the  Caddo  and  Bossier parishes.  The relative success of
gaming  operations in the Bossier City/Shreveport market, as compared to other
Louisiana  markets, may increase the possibility that existing licenses may be
relocated  to  the Bossier City/Shreveport market.  However, the relocation of
existing  licenses  to  another parish or of riverboats within the same parish
will be restricted by the Constitutional Amendment which requires, among other
things,  a  local  parish-wide  election  to  approve,  by  majority vote, the
licensing  of  any  additional  riverboats  in a parish with existing licensed
riverboats  or  the relocation of any operating riverboat to a different berth
in the same parish.

During  September,  1996,  in a statewide election, a Constitutional Amendment
was  approved  by  voters  statewide, which requires local option elections in
parishes  before  new  forms  of  gaming  may  be  conducted therein or before
existing  forms  of  gaming  may  be conducted in new areas.  For example, the
Constitutional  Amendment  requires  a  local  option  referendum  before  an
additional  riverboat  could  move  into  a parish, regardless of whether such
parish  had  authorized the continuation of riverboat gaming in such parish in
the  Louisiana  Referendum.    In this respect, (i.e., relocation of riverboat
gaming  vessels to new locations) the Constitutional Amendment would appear to
be more restrictive than the legislation requiring the Louisiana Referendum.

Licenses  may  be and have been issued for dockside riverboat gaming along the
Red  River  in the Shreveport/Bossier City area.  Dockside gaming is presently
prohibited at other locations in the state.  A riverboat gaming license has an
initial  term  of  five  years,  with  subsequent annual renewals thereafter.
Pursuant  to  the  decision of the State Police at a hearing held on April 30,
1996,  the  Louisiana  riverboat gaming license acquired by the Company has an
unexpired  term  of  five  years  less  the  sixty-five days that the previous
licensee conducted riverboat gaming operations.  The unexpired term of



                                      18

<PAGE>
the  license  recommenced  on  October 4, 1996 the date that the Company began
riverboat  gaming  operations  in  Bossier  City.  The application for renewal
consists  of  a  sworn  statement  of  all  changes  in information, including
financial information, provided in any previous applications.  The transfer of
a  license is prohibited.  The Louisiana Board may restrict, suspend or revoke
a  license or permit.  Suspension or revocation of any license or permit would
have a material adverse effect upon the business of the Company.

Pursuant  to the existing laws, rules and regulations, the Company must submit
detailed  financial,  operating  and  other  reports  to  the  Louisiana Board
periodically.    Substantially all loans, leases, private sales of securities,
extensions of credit and similar financing transactions entered into by any of
the  Regulated  Persons,  including  the sale and issuance of the Senior Notes
offered  hereby,  must  be  reported to the Louisiana Board within thirty days
after  the  consummation  of  any  such  transactions.  The Louisiana Board is
required  to  investigate  all  reported loans or extensions of credit, and to
either  approve  or  disapprove  same.   If disapproved, the pertinent loan or
extension  of  credit  must be rescinded by the appropriate Regulated Person.
The  Company  is  also  required to periodically submit detailed financial and
operating  reports  to  the  Louisiana Board and furnish any other information
which the Louisiana Board may require.

The  applicant  for  a gaming license, its directors, officers, key personnel,
partners,  and  persons holding a 5% or greater interest in the applicant will
be  required  to  be found suitable by the Louisiana Board.  This requires the
filing of an extensive application to the Louisiana Board disclosing personal,
financial,  criminal,  business  and  other  information.    The  applicant is
required  to  pay  all costs of investigation.  There can be no assurance that
such person will be found suitable by the Louisiana Board.  An application for
licensing  of  an  individual may be denied for any cause deemed reasonable by
the  Louisiana  Board.    Any  individual  who  is  found  to  have a material
relationship to or a material involvement with, the Company may be required to
be  investigated  in  order  to be found suitable or be licensed as a business
associate  of  an applicant.  Key employees, controlling persons or others who
exercise  significant  influence upon the management or affairs of the Company
may also be deemed to have such a relationship or involvement.

If  the  Louisiana  Board  were  to  find  a director, officer or key employee
unsuitable  for licensing or unsuitable to continue having a relationship with
an  applicant,  the  applicant  would  have  to suspend, dismiss and sever all
relationships  with such person.  The applicant would have similar obligations
with  regard to any person who refuses to file appropriate applications.  Each
gaming employee must obtain a gaming employee permit which may be revoked upon
the occurrence of certain specified events.

The  sale,  assignment,  transfer,  pledge  or disposition of securities which
represent  5%  of  more  of the total outstanding shares issued by a corporate
licensee  is subject to Louisiana Board approval.  After a license is granted,
any  person  acquiring  an  economic  interest of 5% or more in a license must
obtain  the  Louisiana Board's prior approval for the transaction.  Failure to
obtain  that approval is grounds for license revocation.  A security issued by
a corporate license must generally disclose these restrictions.



                                      19

<PAGE>
If  the  Louisiana  Board  finds  that  an  individual  holder  of a corporate
licensee's  securities  or  a  director,  partner,  officer  or manager of the
licensee  is  not  qualified  pursuant  to  the  existing  laws,  rules  and
regulations,  and  if  as  a  result  the  licensee  is no longer qualified to
continue  as a licensee, it can propose action necessary to protect the public
interest,  including  the suspension or revocation of a license or permit.  It
may  also  issue,  under  penalty  of  revocation  of  license, a condition of
disqualification  naming the person and declaring that such person may not (a)
receive  dividends or interest on securities of the licensee, (b) exercise any
right conferred by securities of the licensee, (c) receive remuneration or any
other  economic  benefit  from  the  licensee  or  continue in an ownership or
economic  interest  in the licensee or remain as a director, partner, officer,
or manager of the licensee.

  FOREIGN

The Provincial Government of Neuqu n, Argentina enacted a casino privatization
program  to  issue 12-year exclusive concession agreements to operate existing
casinos.    The  Company's two casinos are the only casinos in the province of
Neuqu  n,  in  west central Argentina, and are located in Neuqu n City and San
Mart  n  de  los  Andes.    The  casinos  had  previously been operated by the
provincial  government.    The  Ministry of Finance of Argentina has adopted a
modified  regulatory  system  for  casinos,  based  on  the  regulatory system
utilized  by  the  State  of  Nevada,  and  such  regulatory  system  is being
administered  by  the  Provincial  Government  of Neuqu n.  The Company cannot
predict what effect the enactment of other laws, regulations or pronouncements
relating  to  casino  operations  may  have  on  the  operations of the Casino
Magic-Argentina.

  NATIVE AMERICAN GAMING REGULATION

Gaming  on  Native  American  land  is  regulated by federal, state and tribal
governments.    The  operation  of  Native  American  gaming facilities may be
subject  to regulation by the Bureau of Indian affairs, National Indian Gaming
Commission  and  the Tribal Gaming Commission.  The regulations and guidelines
pursuant  to  which  governmental  bodies  will administer gaming statutes and
regulations  are  incomplete  and evolving.  Such statutes and regulations are
subject  to  interpretation  and  may  be  subject to judicial and legislative
clarification or amendment.

The  Sisseton-Whapeton  Dakota Nation has entered into a compact for class III
gaming  with  the  State  of  North  Dakota,  which  has  been approved by the
Secretary  of the Interior.  Under that compact, no person may wager more than
$50  in  any  single  betting  transaction.    Games authorized in the compact
include reel slots, video poker, video keno, black jack, poker, pai gow poker,
Caribbean  Stud Poker, craps, pari-mutuel and simulcast betting and sports and
Calcutta pools, among others.








                                      20

<PAGE>
   NON-GAMING REGULATION

The  Company  is subject to certain federal, state and local safety and health
laws,  regulations  and  ordinances  that  apply  to  non-gaming  businesses
generally, such as the Clean Air Act, Clean Water Act, Occupational Safety and
Health  Act,  Resource  Conservation  Recovery  Act  and  the  Comprehensive
Environmental  Response,  Compensation and Liability Act.  The Company has not
made,  and  does  not anticipate making, material expenditures with respect to
such  environmental laws and regulations.  However, the coverage and attendant
compliance  costs  associated  with  such laws, regulations and ordinances may
result  in  future additional costs to the Company's operations.  For example,
in  1990  the  U.S.  Congress enacted the Oil Pollution Act to consolidate and
rationalize  mechanisms under various oil spill response laws.  The Department
of  Transportation  has proposed regulations requiring owners and operators of
certain  vessels  to  establish  through  the  U.S.  Coast  Guard  evidence of
financial  responsibility  in  the  amount of $5.5 million for clean-up of oil
pollution.    This  requirement would be satisfied by either proof of adequate
insurance  (including  self-insurance)  or  the  posting  of  a surety bond or
guaranty.

Traditional  riverboats  capable  of  cruising,  including  those that are not
required  to cruise, must comply with U.S. Coast Guard requirements as to boat
design,  on-board  facilities,  equipment, personnel and safety.  Each of them
must  hold  a Certificate of Seaworthiness or must be approved by the American
Bureau  of  Shipping ("ABS") Building Code.  The U.S. Coast Guard requirements
establish  design  standards,  set  limits on the operation of the vessels and
require  individual  licensing of all personnel involved with the operation of
the  vessels.  Loss of a vessel's Certificate of Seaworthiness or ABS approval
would preclude its use as a floating casino.

All shipboard employees of the Company, even those who have nothing to do with
the  actual  operation  of  the  vessel, such as dealers, waiters and security
personnel,  may be subject to the Jones Act which, among other things, exempts
those employees from state limits on workers' compensation awards.

   COMPANY LICENSES AND APPLICATIONS

To  date,  other  than  in  Mississippi,  Louisiana,  South Dakota, Greece and
Argentina,  no gaming licenses, approvals or findings of suitability have been
obtained  or,  other than in Indiana, applied for by the Company.  The Company
may  apply  for  additional  gaming  licenses  in  domestic  and international
jurisdictions.   The loss or suspension of any such license, or the failure to
obtain  any  license  for properties upon which the Company plans to operate a
gaming  casino  in  the  future,  would  have a material adverse affect on the
Company's business.

  INFORMATION REGARDING FOREIGN OPERATIONS

The Company operates casinos in Argentina.  Although a number of the Company's
employees  have  experience  in the operation of casinos outside of the United
States,  the  Company's executive officers have had limited experience in such
operations.    The  distance  of  the  operations from the Company's executive
offices, the stability of the relevant government, regulations imposed by the


                                      21

<PAGE>
foreign  government,  tax  issues, and the acceptance of American-style gaming
are  all  risks  associated  with a foreign operation with which the Company's
management  has  had limited previous experience.  Additionally, the Company's
operations  in  foreign  jurisdictions  are  subject  to risks associated with
currency  exchange  rate fluctuations and the repatriation of funds.  See Note
16  regarding  the geographical distribution of operations in the accompanying
Consolidated Financial Statements.

SERVICE MARKS

Casino  Magic  is the owner of U.S. service mark registrations for the service
marks "Casino Magic ", "A Cut Above " and "Casino Magic GetawaysSM" granted by
the  U.S.  Patent  and  Trademark  Office on July 13, 1993, June 21, 1994, and
October  18, 1994, respectively.  Casino Magic is also the owner of a Canadian
service mark registration for "Casino Magic " service mark granted on March 3,
1995.    The  Company has filed service mark registration applications for the
"Casino  Magic" service mark in Greece and Mexico.  A service mark application
with  respect to the service mark "Magic MoneySM" has been filed with the U.S.
Patent  and  Trademark  Office,  and  an  opposition  proceeding  is currently
underway  in  connection  with  such  application.   The Company also uses and
claims  rights  to  several  additional  service  marks.    The  effect of the
Company's  service marks is to provide an identity between the Company and its
services.   U.S. service mark registrations provide protection for a period of
10  years  from  the  date of registration and may be renewed indefinitely for
successive  10-year  periods.  While prior use of a service mark may establish
an  exclusive  right  to  its use in connection with the sale of services in a
particular  market  area,  registration  with  the  U.S.  Patent and Trademark
Office, or similar government agencies in foreign jurisdictions, provides such
right  throughout  the  United  States  or  the  foreign  jurisdiction  and  a
presumption  of damage to the Company should the mark be infringed.  There are
no  assurances  that  any of the service marks used by the Company, whether or
not  registered,  will be free from future challenge by others as to prior use
or as otherwise being unprotectable.

PERSONNEL

As  of January 1, 1997, the Company had approximately 2025 full-time employees
and  240  part-time employees in the United States.  Of the employees, six are
executive  officers  of  the  Company.    The  Company  has  approximately 265
full-time  employees  at  two  foreign  locations  that  the  Company  owns or
operates.    The  Company's management believes that its relationship with its
employees is good.  With the expansion of gaming in the Mississippi Gulf Coast
region and Northwest Louisiana, new competitors are likely to actively recruit
the  Company's management and casino personnel, many of whom have been trained
at  the expense of the Company.  None of the Company's employees are currently
presented by a labor union.

      FORWARD LOOKING STATEMENTS
The  discussions  regarding  proposed  Company  developments  and  operations
included  in  "Item  1  -  BUSINESS"  contain  forward looking statements that
involve  a  number  of  risks  and  uncertainties.  In addition to the factors
discussed  above,    other  factors  that could cause actual results to differ
materially  are  the  following:  business conditions and growth in the gaming
industry and the general economy; existing and future development by gaming
                                      22

<PAGE>
operators  competing  with  the  Company;  obtaining  and  retaining necessary
licenses or regulatory approvals; acquiring or generating funding necessary to
undertake  and  complete development plans; and other risks detailed from time
to  time  in  the  Company's  reports  filed  with the Securities and Exchange
Commission.

ITEM 2.     PROPERTIES
The  Company's  principal  executive and administrative offices are located in
approximately  6,000  square  feet  of  office  space  in the Casino Magic-BSL
support  building  at  711  Casino  Magic  Drive, Bay Saint Louis, Mississippi
39520.

In  all,  the  Company owns, leases or has contracts to acquire the properties
described  below, each of which either currently has gaming facilities or, the
Company's  management  believes,  is  potentially  suitable  for future gaming
operations.

  CASINO MAGIC-BSL PROPERTY
Casino  Magic-BSL  is located on property owned by the Company, which consists
of  approximately 591 acres of land, including a 17-acre marina and an 18 hole
golf  course  located in Bay Saint Louis, Mississippi, on the Gulf of Mexico.
The 591-acre  property secures the $135,000,000 First Mortgage Notes issued in
October 1993.

  CASINO MAGIC-BILOXI PROPERTY
The  Casino  Magic-Biloxi  property  consists  of  approximately  9.0 acres of
contiguous  land  in  Biloxi, Mississippi, on the Gulf of Mexico.  The Company
leases  approximately  3.8  acres  of  the  Biloxi property for current annual
rental  payments  of  approximately  $450,000.   The primary term of the lease
commenced  on  January  4,  1993.  The Company has 17 renewal options for five
years each at an annual base rent of $550,000, plus an additional amount based
upon increases in the Consumer Price Index.  In addition, the Company acquired
approximately  1.3 acres of land contiguous with and to the east of the Biloxi
property.    The  Company  leases  approximately  1.5  acres from the State of
Mississippi  for  an  amount  equal  to  the ad valorem tax which currently is
approximately  $6,500.  This lease is for approximately 80 years.  The Company
owns  approximately 2.5 acres of land north of the Biloxi property across from
Highway  90.    The  Company  also  leases  the  water  area  under the Casino
Magic-Biloxi  barge  from the State of Mississippi pursuant to a 10-year lease
at  an  annual  rent of $595,000 during the first year, increasing annually to
$775,000 at the end of the fifth year and thereafter increasing at rates based
on rules published by the Secretary of State of the State of Mississippi.  The
Company  has  a  renewal  option  for  five  years  at  an annual base rent of
$775,000.

On  May  26,  1995, the Company acquired 4.1 acres of additional adjacent land
through  the  issuance  of  2,125,000  shares  of its Common Stock and thereby
acquired  all  of  the  outstanding  stock  of  Casino  One  Corporation,  a
developmental  stage  company.    Through  such purchase, the Company acquired
assets  with  a  fair  value of approximately $17.0 million, allocated between
land  ($15.8  million)  and  barges  ($1.2 million) and assumed liabilities of
approximately  $4.4  million,  consisting of notes payable, capital leases and
long-term  debt.    The  purchased land is adjacent to the Casino Magic-Biloxi
property.
                                      23

<PAGE>
BOSSIER CITY PROPERTY

In  October  1995,  the Company acquired approximately 20 acres of land on the
Red  River  in  Bossier  City, Louisiana, in exchange for a total of 1,085,000
shares  of  the  Company's  Common  Stock  through  the  acquisition  of  two
corporations,  C-M  of Louisiana, Inc. and Coastal Land of Florida, Inc. which
merged  with the surviving entity becoming Louisiana Corp.  The Company issued
787,500  of these shares to Belle Cherri Land Co., the sole shareholder of C-M
of  Louisiana,  Inc.  and  fee owner of the acquired property, in exchange for
100% of the capital stock of C-M of Louisiana, Inc., and issued 297,500 shares
to  Mark G. George, the sole shareholder of Coastal Land of Florida, Inc., the
holder  of  a 99-year leasehold interest in the property, in exchange for 100%
of  the  capital  stock  of  Coastal  Land of Florida, Inc.  In July 1996, the
Company  acquired 3 additional acres of land contiguous the above mentioned 20
acres for $900,000.

OTHER PROPERTIES

The  Company owns approximately nine acres of land with approximately 370 feet
of  shoreline in Bay Saint Louis, Mississippi on U.S. Highway 90 approximately
2.5  miles  from  Casino  Magic-BSL.   This site, which was acquired in August
1992,  has  been approved as a gaming site by the Mississippi Commission.  The
Company does not currently intend to develop this site for gaming.

The  Company  purchased  approximately 25.6 acres of land on which two private
residences  are  located.    This property is on the Jordan River, immediately
west  of  the Company's gaming operation in Bay Saint Louis, Mississippi.  The
Company purchased the property to provide additional land for future expansion
and  to prevent potential competition from acquiring a possible gaming site in
immediate  proximity to Casino Magic-BSL.  The Company has no plans to develop
the property in the near future.

On  July  13,  1993,  the Company executed three 12 month option agreements to
acquire  certain  parcels of land in Mobile, Alabama which may be suitable for
casino gaming.  The total price to exercise the option is $15.0 million and is
subject  to  an  escalation  index.    In  July 1994, the Company extended the
options  for an additional year at a cost of approximately $196,000.   In July
1995,  the  Company  extended  the  options through the year 2000 at a cost of
approximately  $1.3 million, 4.9% of income before income taxes of all casinos
and  related business conducted by the Company on the optioned property for 10
years  and  an  option to purchase 200,000 shares of the Company's stock at an
exercise price of $5.8125 per share.

In  1993  and  1994,  the Company acquired two parcels of land in downtown St.
Louis,  Missouri  in  anticipation  of obtaining a gaming license in that city
through  a  joint  venture  with  Caesars  World, Inc.  One 3.5 acre parcel of
unimproved  land was purchased at a cost of approximately $3.6 million, and is
included  in the Company's Financial Statements at December 31, 1996, property
held for sale, with a book value of approximately $4.0 million

The  other  0.2  acre  parcel  of  land  was purchased for $0.8 million and is
included  in  the  Company's  financial  statements  at  December 31, 1996, as
property held for sale having a book value of approximately $820,000.


                                      24

<PAGE>
On  December  11, 1993, the Company entered into an agreement for an option to
lease  certain property in Indiana. The agreement requires advance payments of
$500,000  in each of four years, and upon exercise, would allow the Company to
lease  the  subject  property  at  $1,000,000  per  year  for twenty years. At
December  31,  1996, aggregate payments of $2,000,000 under this agreement are
included in options and land deposits.

On  January  11,  1994,  the Company executed two $20,000 option agreements to
acquire  land  in  Indiana  at  a  cost of $6,000 per acre on approximately 40
acres,  and  $7,000  per  acre  on  approximately  119  acres, or $240,000 and
$833,000,  respectively, less the option payments.  The options expire (i) one
year  from the date of the agreements or (ii) on the date the Company receives
a gaming license from the Indiana Gaming Commission, whichever term is longer.
 In  February  1995, the Company paid $6,000 for a two-year option to purchase
additional  land  in  Indiana at a cost of $7,000 per acre on approximately 35
acres  ($245,000), less the option payment.  Aggregate payments of $46,000 are
included  in  options  and land deposits at December 31, 1996, with respect to
the Indiana options.

On March 12, 1994, a wholly-owned subsidiary of the Company acquired an option
to  purchase  certain  property  located  in  Boston, Massachusetts, for $60.0
million.  In December 1995, the Company abandoned all efforts to pursue gaming
at  this  site.    The  option  agreement required that the Company pay a $5.0
million  option  payment  in  March  1994  and a second option payment of $5.0
million  in  January  1996.    In  January 1996, the Company renegotiated this
option  and  obtained significant cost reductions in the second option payment
under  the  agreement.  The renegotiated option agreement requires payments of
$2.9  million  in February 1996, $500,000 in January 1997, $500,000 in January
1998  and  $475,000 in January 1999, and extends the option through 2003.  The
agreement  escalates the purchase price by $10.0 million per year through 1998
and  requires  the  land  owner  to  pay  all taxes on the optioned property.
Although the new option agreement extends the option through 2003, the Company
does  not  intend  to  pursue  gaming  at  this site and in December 1995, the
Company  expensed  approximately  $9.0  million  in costs associated with this
property.  This includes the discounted value of future option payments.

In  June  1994, the Company purchased property in Pennsylvania at a total cost
of  approximately  $2.0  million  which is included in the Company's financial
statement  as property held for development at December 31, 1996 and 1995.  In
addition  to  the  basic purchase price of the property, the agreement of sale
requires  the  Company to pay the seller $5.0 million if the Company obtains a
license  to  operate a casino operation on the premises at any time before May
31, 1999.

ARGENTINA LEASED PREMISES

The  Company,  through  its  wholly-owned subsidiary, Casino Magic-Neuqu n SA,
leases  the  existing casino premises for one of its casinos.  Included in the
annual  cannon  fee  are  monthly  fees  of  $40,000 for the use of space in a
building  near  the  airport in the City of Neuqu n.  At the Company's option,
the  current  operations can be relocated at any time, thereby eliminating the
monthly  fees.    See  "Item  1-Business-Existing  Operations-Casino
Magic-Argentina".

See Item 1 - "Business-Future Development".
                                      25

<PAGE>
ITEM 3.     LEGAL PROCEEDINGS

ONGOING LEGAL PROCEEDINGS

A  class  action  lawsuit  was  filed  on April 26, 1994, in the United States
District  Court,  Middle District of Florida (the "Poulos Lawsuit"), naming as
defendants  41 manufacturers, distributors and casino operators of video poker
and electronic slot machines, including the Company.  The lawsuit alleges that
such  defendants have engaged in a course of fraudulent and misleading conduct
intended  to  induce  people  to  play  such  games  based  on  a false belief
concerning  the  operation  of  the  gaming machines, as well as the extent to
which  there  is  an  opportunity  to win.  The suit alleges violations of the
Racketeer Influenced and Corrupt Organization Act, as well as claims of common
law  fraud,  unjust  enrichment  and  negligent  misrepresentation,  and seeks
damages  in  excess  of  $6  billion.   On May 10, 1994, a second class action
lawsuit  was  filed  in  the  United States District Court, Middle District of
Florida  (the  "Ahern  Lawsuit"), naming as defendants the same defendants who
were  named  in  the  Poulos  Lawsuit  and  adding as defendants the owners of
certain  casino  operations in Puerto Rico and the Bahamas, who were not named
as  defendants  in  the  Poulos  Lawsuit.  The claims in the Ahern Lawsuit are
identical  to  the claims in the Poulos Lawsuit.  Because of the similarity of
parties  and  claims,  the  Poulos  Lawsuit  and  Ahern  Lawsuit have now been
consolidated  into  one  case file in the United States District Court, Middle
District  of  Florida.    On December 9, 1994 defendants' motion for change of
venue  was granted, transferring the case to the U.S. District Court, District
of  Nevada,  in  Las  Vegas.  In response to a motion to dismiss the Complaint
brought  by the Company and other defendants, the United States District Court
for the District of Nevada entered an Order dated April 17, 1996, granting the
motions  and  dismissing the complaint without prejudice.  The plaintiffs then
filed  an  amended  Complaint  on May 31, 1996, in which the plaintiffs sought
damages  against  the Company and other defendants in excess of $1 billion and
punitive  damages  for  violations  of  the  Racketeer  Influenced and Corrupt
Organizations Act and for state common law claims for fraud, unjust enrichment
and  negligent misrepresentation.  The Company and other defendants have moved
to  dismiss  the  amended Complaint.  The Company believes that the claims are
without  merit  and  does  not  expect  that  the lawsuit will have a material
adverse  effect  on  the  financial  condition or results of operations of the
Company.

On  October 20, 1994, International Gaming Network, Inc., commenced litigation
in  Federal  Court  against  Casino Magic Corp. by filing a Complaint with the
U.S.  District Court, District of South Dakota, Southern Division.  Plaintiff,
in  that  litigation,  has  alleged,  among  other  things,  that  the Company
intentionally  and  improperly  interfered  with  Plaintiff's  existing  and
perspective  contractual,  economic  or  business  relationship  with  the
Sisseton-Wahpeton  Sioux  Tribe,  and  seeks damages of $28,292,102.  In April
1994,  the  Company  entered  into  an agreement with the Tribe to develop and
manage  a  gaming  casino  on tribal lands in northeastern South Dakota.  (The
Company  has  since  canceled  the  management  agreement  and  entered into a
consulting  agreement  with  the  Tribe.)    On  November 9, 1994, the Company
interposed  an  answer  denying  the  allegations  contained  in  Plaintiff's
estimated  range  or  potential  loss,  if  any, which may be sustained by the
Company  in  connection  with  this  litigation,  but  believes the lawsuit is
meritless and intends to vigorously defend the claim.


                                      26

<PAGE>
The  United  States  District  Court,  on October 7, 1996, filed a Judgment of
Dismissal,  dismissing  all  of  Plaintiff's  claims, pursuant to a Motion for
Summary Judgment which had been brought by Casino Magic.  Pursuant to a Notice
of  Appeal dated November 5, 1996, the Plaintiff has appealed the dismissal of
its  claims  to the United States Court of Appeals for the Eight Circuit.  The
Company  can  furnish  no  opinion  at  this  time  concerning likelihood of a
favorable  outcome or an estimation range or potential loss, if any, which may
be  sustained  by the Company in connection with this litigation, but believes
the lawsuit is meritless and intends to vigorously defend the claim.

TERMINATED LEGAL PROCEEDINGS

None

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

No  matters  were submitted to a vote of the Company's security holders during
the fourth quarter of the year ended December 31, 1996.

PART II

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

The  Company's  common stock is traded over-the-counter and has been quoted on
the NASDAQ National Market since October 23, 1992, under the symbol CMAG.  The
following  table  sets  forth  for  the periods indicated the high and low per
share  bid  prices  for  the  Company's  common  stock as quoted on the NASDAQ
National Market.  The information set forth below was obtained from the NASDAQ
National Market.

           1995              High       Low

         Quarter 1         $ 7.500     $ 4.875
         Quarter 2         $ 7.625     $ 5.313
         Quarter 3         $ 6.500     $ 5.125
         Quarter 4         $ 5.500     $ 3.000


           1996

         Quarter 1         $ 4.063     $ 2.750
         Quarter 2         $ 7.063     $ 3.875
         Quarter 3         $ 5.875     $ 3.625
         Quarter 4         $ 4.125     $ 2.156


           1997

         Quarter 1*        $ 1.844     $ 1.625

______________________
* As of the close of business on March 21, 1997.


                                      27

<PAGE>
The  last  sales  price for the Company's common stock as quoted on the NASDAQ
National  Market  as of the close of business on March 21, 1997 was $1.625 per
share.    The  over-the-counter  quotations above reflect inter-dealer prices,
without  retail  markup, markdown or commissions, and may not represent actual
transactions.    There  were  approximately  1,318  shareholders  owning  the
Company's common stock of record as of the close of business March 21, 1997.

The  Company has not paid any cash dividends with respect to its common stock,
and  does  not  anticipate  doing  so  in the foreseeable future.  The Company
intends  to  retain  all  earnings  for  the  foreseeable  future  to fund the
operation  and expansion of its business.  The payment of any future dividends
will  be  determined  by  its  Board  of Directors in light of conditions then
existing,  including  the  Company's  earnings,  financial  condition  and
requirements,  restrictions  in  financing agreements, business conditions and
other  factors.    The  indenture  agreements covering both outstanding  first
mortgage  notes  in  the  aggregate  principal amount of $250,000,000 million,
contain limitations on the Company's ability to pay dividends.





































                                      28

<PAGE>
ITEM 6.      SELECTED FINANCIAL DATA

Presented  below  are the selected consolidated financial data of Casino Magic
and its subsidiaries for the five years ended December 31, 1996 which has been
derived from the audited consolidated financial statements of Casino Magic and
its  subsidiaries.    This  data  has  not  been  examined  by  the  Company's
independent  auditors,  Arthur  Andersen  LLP.    The  selected  consolidated
financial  data  should be read in conjunction with the consolidated financial
statements,  related  notes and other financial information included elsewhere
in this Annual Report.
(IN THOUSANDS
 EXCEPT PER
 SHARE DATA)                     YEAR ENDED DECEMBER 31,

Statements of
 operations
 data                   1996(5)     1995(4)    1994(3)      1993(2)
1992(1)

Revenue            $180,278     $177,723   $185,018     $202,404   $27,139
Costs and
Expenses            171,435      172,952    173,786      136,996    17,419

Income (loss)
 from Operations      8,843        4,771     11,232       65,408     9,720

Other Expenses       45,109       18,294     14,450        5,677     1,762

Net Income (loss)   (31,589)     (10,292)    (3,030)      38,506     5,046

Net Income (loss)
 Per Share             (.88)        (.30)     (0.10)        1.32      0.30

(IN THOUSANDS)                       DECEMBER 31,

Balance  Sheet Data     1996(5)     1995(4)     1994(3)     1993(2)
1992(1)

Working Capital
 (deficiency)       $ (6,492)     $  15,910   $ 20,847   $ 50,021    $(13,926)

Total Assets         370,602        268,473    252,623    222,892      61,293

Current Liabilities
 (including con-
 struction Payables)  48,449         32,171     25,139     21,553      23,757

Long-term Debt, Net
 of Current
 Maturities          258,261        136,840    135,643    131,984      12,605

Shareholders'
 Equity               63,625         95,179     79,577     66,858      24,932




                                      29

<PAGE>

(1)  Includes full years operations of Casino Magic-South Dakota and 91 days
     of operations of Casino Magic-BSL.
(2)  Includes full years operations of, Casino Magic-BSL, Casino Magic-South
     Dakota and approximately  seven months of operations of Casino Magic-
     Biloxi.
(3)  Includes full years, operations of, Casino Magic-BSL and Casino Magic-
     Biloxi, Casino Magic-South Dakota.
(4)  Includes full years, operations of, Casino Magic-BSL, Casino Magic-
     Biloxi and Casino Magic-Neuqu n, Casino Magic-South Dakota seven and
     one half months of operations for Casino Magic-Porto Carras a 49%
     equity interest of Casino Magic.
(5)  Includes full years, operations of Casino Magic-BSL, Casino Magic-Biloxi,
     Casino Magic-Neuquen, 87 days of operations of Casino Magic-Bossier City,
     six and one half months of operations of Casino Magic-South Dakota and
     nine months of operations for Casino Magic-Porto Carras a 49% equity
interest of Casino Magic.

ITEM 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
           RESULTS OF OPERATIONS

GENERAL

The Company commenced operations on the Gulf Coast of Mississippi in September
1992  at Casino Magic-BSL.  In 1993 the Company opened Casino Magic-Biloxi; in
1995  the  Company opened a gaming facility in Porto Carras, Greece, (in which
the Company had a 49% equity ownership): in 1995 the Company opened two gaming
facilities  in  the  Province  of  Neuquen  Argentina; and in 1996 the Company
opened Casino Magic-Bossier City.  Since its organization in 1992, the Company
owned and operated a casino in Deadwood, South Dakota, which was immaterial to
the  Company's  business.   Because of poor operating performance, in 1996 the
Company  sold  its  gaming  facilities in Deadwood, South Dakota, and its' 49%
ownership  in  the  gaming facility in Porto Carras, Greece.  In addition, the
Company terminated all management operating agreements in Greece.





















                                      30

<PAGE>
RESULTS OF OPERATIONS

The  following  table  sets  forth for the periods indicated certain operating
information  for  the  Company  on  a  consolidated basis and for its existing
properties  as  of  December  31,  1996.  The principal operating entities are
Casino  Magic-BSL  and Casino Magic-Biloxi, both dockside casinos operating on
the  Gulf  Coast  of Mississippi, Casino Magic-Bossier City, a dockside casino
which  commenced  gaming  operations in Northwest Louisiana on October 4, 1996
using  a  temporary  facility and Casino Magic-Neuqu n, which commenced gaming
operations  at  its  two  casinos  in  Neuqu  n  and  San Mart n de los Andes,
Argentina,  on  January  1,  1995.   The revenues, costs and expenses of Porto
Carras  are  not  included  below,  as Porto Carras is accounted for under the
equity method of accounting.

                                           FISCAL YEAR ENDED DECEMBER 31,
                                                   (In Thousands)
                                           1996                1995
1994
Revenues:
  Casino Magic-BSL         (1)          $ 83,924       $ 87,534   $107,547
  Casino Magic-Biloxi      (2)            63,876         72,737     75,095
  Casino Magic-Bossier City(3)            12,738             --         --
  Casino Magic-Neuqu n     (4)            15,885         13,084         --
  Corporate  and  Other         (5)             3,855          4,368
2,376
Total Revenues:                         $180,278       $177,723   $185,018

Costs and Expenses:
Casino Magic-BSL          (1)          $ 67,356      S 71,356    $80,361
Casino Magic-Biloxi       (2)            56,983        59,882     65,471
Casino Magic-Bossier City (3)            20,060            --         --
Casino Magic-Neuqu n      (4)            12,553        11,424         --
Corporate and Other       (5)            14,483        30,290     27,954
Total Costs and Expenses:              $171,435      $172,952   $173,786

Income (Loss) From Operations:
Casino Magic-BSL          (1)          $ 16,568      $ 16,178    $27,186
Casino Magic-Biloxi       (2)             6,893        12,855      9,624
Casino Magic-Bossier City (3)            (7,322)           --         --
Casino Magic-Neuqu n      (4)             3,332         1,660         --
Corporate  and  Other              (5)            ($10,628)     ($25,922)
($25,578)
Total Income From
  Operations:                           $ 8,843       $ 4,771    $11,232

(1)     Began operations September 30, 1992; expanded casino capacity December
31, 1992.
(2)    Began  operations  June  5, 1993; expanded casino capacity December 16,
1993.
(3)    Began operations October 4, 1996; opened permanent facility on December
31, 1996.
(4)   Began operations January 1, 1995.
(5)    Includes management fees and royalty fees from Porto Carras which began
operations  May  18,  1995. Equity in earnings with respect to Porto Carras is
reported  as  non-operating  income.   The Company ceased recording management
fees and royalty fees from Porto Carras on October 1, 1996.

                                      31

<PAGE>
YEAR ENDED DECEMBER 31, 1996 COMPARED TO YEAR ENDED DECEMBER 31, 1995
Consolidated  revenues  increased  $2.6  million,  or  1.4%, to $180.3 in 1996
compared  to  $177.7  in  1995.  The increase in 1996 consolidated revenues is
attributable  to  $12.7  million  in revenues from the Company's new facility,
Casino  Magic-Bossier City, which opened using a temporary facility on October
4,  1996  and increased revenues from Casino Magic-Neuqu n of $2.8 million, or
21.4%.  The  majority  of  the increase at Casino Magic-Neuquen in revenues is
attributable  to  the  increased slot revenues of $3.4 million.  Slot revenues
increased  in  1996  compared to the same period in 1995 due to an increase in
the  number  of  slots  at  Casino  Magic-Neuquen from 89 to 400 in May 1995.
Additional  increases  resulted  from  increased  customer  counts  and  their
influence  on  food  and  beverage  revenues.   These increases in revenues at
Casino  Magic-Neuquen  were  offset  by  declining  table games revenues.  The
increase  in  consolidated revenues where offset by reduced revenues at Casino
Magic-BSL,  Casino  Magic-Biloxi  and  the  loss  of  approximately six months
revenues  from  the sale of a gaming facility in Deadwood, South Dakota, which
the  Company  sold  in  June 1996.  Casino Magic-Biloxi revenues declined $8.9
million, or 12.2%, from 1995 to 1996.  This decline is primarily the result of
adjacent  hotel/casino  operations  on both sides of Casino Magic-Biloxi which
have  significantly  greater  amenities  than  Casino  Magic-Biloxi.    While
competitive  pressures  will  likely  continue  to  adversely  effect  Casino
Magic-Biloxi's  revenues  and  operating margins, management believes that the
hotel  currently under construction at Casino Magic-Biloxi will help offset or
reverse  these  declines  in  revenues.    Completion  of  the hotel at Casino
Magic-Biloxi  is  expected in the first quarter of 1998.  Additionally, Casino
Magic-Biloxi  may  experience reduced revenues in 1997 during the construction
of  the  hotel due to customer inconveniences during the construction phase of
the  casino  and  hotel  entrance  areas.  However, Management is preparing to
minimize  the  impact of the construction on the customer.  The combination of
construction  disruption caused by the development of a new buffet and kitchen
and  increased  overall competition in the Gulf Coast and New Orleans markets,
both  of which Casino Magic-BSL competes in, caused the $3.6 million, or 4.1%,
decline  in  revenues  at  Casino  Magic-BSL.    The  loss  of $1.4 million in
Corporate  and  other revenues is due to the sale of a gaming facility located
in Deadwood, South Dakota, ("Goldiggers") which the Company sold in June 1996.
 Although  royalty  and  management fee revenues increased by $0.9 million, or
39.3%,  to  $3.1  million  in  1996,  the  Company  has divested itself of all
operations  in  Greece  during  1996  where  the majority of all royalties and
management fee revenues where generated.

Total  operating  costs  and expenses were down $1.5 million, or 1.0%, in 1996
compared to 1995.  Casino expenses increased $5.3 million, or 7.6%, during the
same  period  principally  as  a  result  of  the Company opening a new gaming
facility in Bossier City, Louisiana, which had $7.1 million in casino expenses
in  1996.    This increase in casino expenses relating to Casino Magic-Bossier
City  was  offset  by  reduced  expenses at Casino Magic-Biloxi as a result of
reduced  revenues,  and the sale of the Company's gaming facility at Deadwood,
South Dakota in June 1996.  Food and beverage costs increased $0.6 million, or
8.1%,  as  a  result  of  increased customer traffic at Casino Magic-Neuquen.
Casino  Magic-Neuquen relies on its food and beverage facilities at the casino
to  promote  casino operations.   Other operating costs and expenses increased
$1.5  million,  or  110.5%,  to  $2.8  million in 1996 compared to 1995.  This
increase  is the result of additions to amenities at Casino Magic-BSL, and the
transfer  of  the  gift  shop  operations  at  Casino  Magic-BSL  and  Casino
Magic-Biloxi from a third party to the Company.  During 1996, Casino Magic-BSL
added
                                      32

<PAGE>
amenities  relating to the Arnold Palmer designed golf course, such as the pro
shop, the Arnold Palmer Golf Academy and the groundskeeping department.  These
costs  will increase in 1997 since the golf course became fully operational in
February  1997.    In  addition, Casino Magic-BSL began operating a child-care
facility  for  casino  patrons  in  1996.   Advertising and marketing expenses
decreased  by  $5.0  million,  or  19.2%,  in  1996 as compared to 1995.  This
decrease  is  the  result  of  several  factors: a reduction in the use of air
charters  to  attract  customers;  the  use  of more cost efficient promotions
concerning  give-aways  through  the  Magic  Money  Players  Club Card; and an
overall  reduction  in  marketing  and  advertising  costs  during 1996.  This
decrease  was  offset  by  the  opening  of the Company's new facility, Casino
Magic-Bossier  City,  in  October  1996.   As a result of the opening of this
third  major  gaming facility, marketing and advertising costs are expected to
increase  during  1997.  General  and  administrative  expenses decreased $4.3
million,  or  15.0%,  in  1996  as  compared  to the same period of 1995.  The
decline  is  a  result  of  cost reduction measures implemented in early 1996,
including  the  elimination  of several corporate officer positions. In future
periods, this reduction will be partially offset due to additions in July 1996
to  the  Company's  management  of two key executive officer positions, a Vice
President/Chief  Operating  Officer  and  a  Vice  President/Construction  and
Development.    Additionally, general and administrative costs are expected to
increase  in  1997  as a result of the opening of Casino Magic-Bossier City in
1996.    Property  operation,  maintenance  and  energy  costs  increased $3.4
million,  or  83.2%, in 1996 as compared to 1995 as the result of the addition
of  Casino Magic-Bossier City, the continued aging of the gaming facilities at
Casino Magic-BSL and Casino Magic-Biloxi which required more maintenance costs
in  1996,  and the addition of the golf facility at Casino Magic-BSL in 1996.
This  expense  category  is anticipated to increase in 1997 as a result of the
continued  maintenance  of  Casino  Magic-BSL  (including  the golf facility),
Casino  Magic-Biloxi and Casino Magic-Bossier City.  Rents, property taxes and
insurance  costs  increased  by $1.7 million, or 38.9%, in 1996 as compared to
1995.    The  increase  is  in  part  a  result  of  the  addition  of  Casino
Magic-Bossier  City.  Depreciation and amortization increased $2.6 million, or
16.3%,  in  1996 as compared to the same period in 1995.  This increase is due
to  the  addition  of  tangible  depreciable property, the amortization of the
investment  costs  in  excess of equity interest in the 49% owned Greek gaming
facility  which  was  amortized  for  105 days in  1995 and for nine months in
1996,  and  a change in 1996 in the method used to amortize the Company's land
option deposits over the life of the option.  After September 1996, management
wrote-off  the  excess  of  equity  interest  in  the  Greek gaming facility.
Furthermore,  the addition of Casino Magic-Bossier City increased depreciation
expense,  while  the  divesting  of the Company's gaming facility in Deadwood,
South  Dakota,  decreased  depreciation  expense.    In 1997, depreciation and
amortization  will  increase due to the addition of Casino Magic-Bossier City.
Preopening  costs  increased  by  $4.7 million, or 260.0%, in 1996 from 1995.
This is a result of the opening of Casino Magic-Bossier City in October 1996.
In  1995  the  Company  opened the Greek gaming facility in which it had a 49%
ownership.






                                      33

<PAGE>
Consolidated  income from operations increased $4.0 million, or 83.3%, to $8.8
million  in  1996 compared to $4.8 million in 1995.  Operating margins (income
from  operations  as a percentage of revenues) grew from 2.7% to 4.9% over the
comparative  periods.   Casino Magic-BSL's operating margin grew from 18.5% to
19.7%,  Casino  Magic-Biloxi's  operating margin decreased from 17.6% to 10.8%
and  Casino  Magic-Neuqu  n's operating margin increased from 12.7% to 21.0%.
The  increased  margin  at  Casino  Magic-BSL is primarily due to cost-cutting
measures,  the  decline  in  Casino  Magic-Biloxi's  margin  is  due  to  the
significant decline in revenues from the loss of market share along the Biloxi
Strip,  and  Casino  Magic-Neuqu  n's  increased margin is attributable to the
increase  in  the number of slot machines and the low cost revenues associated
with slots as opposed to table games.
Consolidated  other  (income)  expense  (non-operating  income  and  expenses)
increased  $26.8  million from a net expense of $18.3 million to a net expense
of  $45.1  million  over  the  comparative  periods.   Of this increase, $26.1
million,  is  due  to  the Company's decision to write off its investment in a
gaming  facility  in  Porto Carras, Greece, ("Porto Carras") where the Company
had  a  49%  equity  interest.  Management's decision was based on the results
from  the  Company's  Greek gaming facilities after the opening of a competing
casino.   In September 1996, Hyatt Corporation opened a new casino in the City
of  Thessaloniki,  Porto Carras's primary market, and was allowed to charge an
$8  admission  fee  compared to Porto Carras' $20 admission fee.  Although the
Company  anticipated  some  revenue  loss  as  a  result  of  this  increased
competition  and  admission  fee differential, the actual effects were greater
than  anticipated  and  resulted in a $2.0 million loss in operations at Porto
Carras  for  the  month  of  September  1996.   Despite new marketing and cost
containment  efforts, these losses continued.  Furthermore, the majority owner
in  Porto  Carras  venture was unwilling or unable to advance any funds to the
operation.   Additionally, the majority owner informed the Company that it did
not  intend  to operate a substantial portion of the Porto Carras resort area,
consisting  of  two  hotels  and  amenities,  during  the  1997 season.  These
factors,  among  others,  led  to  the  Company's  decision  to  write off its
investment  in  Porto  Carras  and led to the sale of Porto Carras in December
1996  for  a  nominal  amount.    Net  interest expense (interest expense less
capitalized  interest and interest income) increased $2.1 million from 1995 to
1996.    The  increase  reflects the cost of funding the development of Casino
Magic-Bossier  City.    In  August  1996,  the Company, through a wholly owned
subsidiary,  issued  $115  million  in  first  mortgage  notes  to fund Casino
Magic-Bossier  City.  In 1997, net interest expense will increase based on the
issuance  of  these  first  mortgage  notes.    In  1995, the Company expensed
capitalized costs relating to development joint ventures in the amount of $2.2
million.  In 1996, no such expense was incurred.
The  Company's  effective  tax  rate  for 1996 of approximately (13.0%) is the
result  of  an  allowance  against  deferred  tax assets of approximately $8.3
million.    This  valuation  allowance  was  recorded  in  recognition  of the
Company's  recent  operating  results.    The  effective  tax rate for 1995 of
(24.0%) is due to significant permanent tax differences.







                                      34

<PAGE>
The  Company had a net loss of ($31.6) million, or a loss of ($0.88) per share
in  1996  as compared to net loss of ($10.3) million, or a loss of ($0.30) per
share  in  1995.    The  increase  in  the net loss is attributable to several
factors; the write off of the Company's investment in Porto Carras Casino S.A.
of $26.1 million; the preopening cost relating to Casino Magic-Bossier City of
$6.6  million;  to  a  lesser extent, decreased revenues at the Company's Gulf
Coast  operations  which  resulted in part from intensified competition on the
Gulf  Coast  over  comparative  periods;  as  well  as  the recording of a tax
valuation allowance of $8.3 million.  These 1996 increases are somewhat offset
by  1995 write-offs relating to terminated development efforts with respect to
specific properties and jurisdictions of $13.6 million.

YEAR ENDED DECEMBER 31, 1995 COMPARED TO YEAR ENDED DECEMBER 31, 1994

Consolidated  revenues  decreased $7.3 million, or 3.9%, to $ 177.7 million in
1995,  compared  to  $185.0  million in 1994.  The 1995 revenues include $13.1
million  of  revenues  from  Casino  Magic-Neuqu  n,  a wholly-owned Argentina
subsidiary  of  Casino Magic Corp.. Gaming revenues were $12.3 million less in
1995  compared  to  the  prior year.  The decrease was made up of a decline in
gaming  revenues  at  Casino  Magic-BSL  of  $22.0  million  which  was offset
partially  by  the  gaming revenues at Casino Magic-Neuqu n of $12.2 million.
The  decrease  in  revenues  at  Casino  Magic-BSL  reflects  the  continued
competition  from  casinos operating in Southern Louisiana, including Harrah's
temporary  land-based  casino  in  New  Orleans  which opened in May, 1995 and
closed  in  November,  1995.  The  New  Orleans  metropolitan  area  is Casino
Magic-BSL's  primary  market  area.  Food and beverage revenues increased $0.7
million,  of  which  $0.8 million was generated by Casino Magic-Neuqu n.  Room
revenues  increased  approximately $2.1 million as a result of the addition of
the 201 room inn at Casino Magic-BSL which began operations in December, 1994.
 The  1995  revenue  also  reflects $2.2 million of Royalty and Management Fee
income  with  respect to Porto Carras.  The Porto Carras casino opened May 18,
1995 and is accounted for under the equity method of accounting.

Total  operating  costs  and expenses were down $0.8 million, or 0.5%, in 1995
compared  to  1994.    Casino  expenses decreased $3.64.5 million, or 4.96.3%,
during  the  same  period, principally as a result of lower operating costs of
$11.1 million, or 16%, at Casino Magic-BSL and Casino Magic-Biloxi.  The lower
operating  costs  were  partially  offset  by  the addition of $6.7 million of
casino expenses at Casino Magic-Neuqu n.  Rooms expense increased $1.0 million
over  the  comparative  year  as a result of the addition of the Inn at Casino
Magic-BSL.    Advertising and marketing expenses, as a percentage of revenues,
increased  to  146.6% compared to 13.65% in 1994.  The increase in advertising
and  marketing  expenses  is  in  response  to  increased  competition  at the
Company's  Gulf  Coast  operations.  However, in June 1995 the Company reduced
its  reliance  on  its  air charter program resulting in a decrease in the air
charter program costs.  This decrease was offset by an increase in advertising
and  promotion  costs, some of which relates to Casino Magic-Neuqu n.  General
and administrative expenses were down $1.3 million or 4.3% in 1995 compared to
1994.  General and administrative expenses in the current year reflects a $0.9
million  reduction  of  payroll  and  benefit  costs related to canceled stock
options  and grants previously expensed to deferred compensation expense.  The
overall  decrease  in  general  and administrative costs in 1995 was partially
offset by the addition of Casino Magic-Neuqu n  which increased general and


                                      35

<PAGE>
administrative  cost  by  $1.9  million in the current year.  Depreciation and
amortization  increased  $5.1  million  in 1995 due to (i) amortization of the
cost  of the concession agreement with the government of Argentina relating to
Casino  Magic-Neuqu  n,  (ii)  amortization  of  investment costs in excess of
equity  interest  in  Porto Carras, (iii) an entire year's depreciation on the
Inn  at  Casino  Magic-BSL,  (iv)  amortization of land options and (v) a $1.0
million write down of the Goldiggers property.  Development expenses decreased
approximately  $8.0  million,  to  $2.2  million  in  1995  as a result of the
Company's decision to scale back development activities in 1995.

The  Company  incurred  special  charges in 1995 and 1994 of $14.5 million and
$5.5  million,  respectively,  due  to  the  Company's  decision  to terminate
development  efforts  with  respect to specific properties and jurisdictions.
Because  of  this  determination,  significant capitalized amounts relating to
land,  land options, joint ventures and construction projects were written-off
or  revalued.    The  write-offs  are recorded under "Write-off of capitalized
costs relating to inactive developments" and "Depreciation and amortization".
Income  from  operations  (excluding  the  special  charges  in 1995 and 1994)
increased  $0.4  million to $17.1 million in 1995 compared to $16.7 million in
1994.  Operating margins (income from operations -- excluding special charges,
as  a percentage of revenues) increased from 9.0% to 9.6% over the comparative
periods.   A portion of this improvement is a result of royalty and management
fees  generated  from  Porto Carras which was generated at substantially lower
costs  than  owned  properties.  Casino Magic-BSL's operating margin fell from
25.9%  to  18.5% reflecting the continued decline in revenues resulting mostly
from  competition  in  the New Orleans regional market.  Casino Magic-Biloxi's
operating margin increased from 14.1% to 17.7% principally due to decreases in
operating costs.

<PAGE>

Loss  from  unconsolidated subsidiaries primarily reflects the Company's share
in  the  losses  generated  by  a  joint  venture  parking  garage adjacent to
Casino-Magic  Biloxi  which  is  partially  offset by the Company's 49% equity
interest  in Porto Carras.  Other income and expense (non-operating income and
expense) for 1995 includes amortization of $1.3 million of loan guarantee fees
with respect to the proposed purchase of the majority interest of Porto Carras
and  certain  operating  assets.   Net interest expense (interest expense less
capitalized  interest and interest income) increased $1.8 million from 1994 to
1995.    The  increased interest expense is due to the financing of new gaming
equipment at Casino Magic-BSL, and the addition of a $3.0 million bank loan in
December of 1994, and lower interest income, as cash and marketable securities
were applied to new developments.

The Company had a net loss of $10.3 million or $.30 per share in 1995 compared
to  a  net  loss of $3.0 million or $.10 per share in the preceding year.  The
decreased  earnings were a result of the significant write-offs related to the
Company's  decision  to terminate development efforts with respect to specific
properties  and jurisdictions and to a lesser extent decreased revenues at the
Company's  Gulf  Coast  operations.   The decrease in revenues was due in part
from  intensified  competition  on the Gulf Coast during 1995, particularly in
the  more  populous areas of southern Louisiana.  The decreases were partially
offset  by  earnings  with  respect  to  Porto Carras and Casino Magic-Neuqu n
coupled with lower costs and expenses in the current period.



                                      36

<PAGE>
LIQUIDITY AND CAPITAL RESOURCES

At  December  31,  1996,  the  Company  had  unrestricted  cash and marketable
securities  of  $17.6  million  compared  to cash and marketable securities of
$30.8 million at December 31, 1995. In addition, the Company had $17.0 million
in  restricted  cash  relating  to  the  $115,000,000  First  Mortgage  Notes
("Louisiana  First  Mortgage Notes") issued to fund the construction of Casino
Magic-Bossier  City  (see  discussion  of offering below).  For the year ended
December  31,  1996,  the  Company  generated  $26.0 million of cash flow from
operating  activities  and  received  $121.0  million  of  proceeds  from  the
incurrence  of  long  term  debt.    The  Company spent $70.0 million for the
acquisition  of  property,  equipment  and other long-term assets, and reduced
long term debt by $48.6 million.

The  Company  expended  approximately $17.2 million in capital improvements at
its  Gulf Coast properties and $54.0 million in capital improvements at Casino
Magic-Bossier  City  during 1996.  The Company plans additional investments in
1997  at  its  Gulf  Coast  properties  and Casino Magic-Bossier City, much of
which  is  subject  to the availability of financing.  The Company is pursuing
gaming  opportunities  outside  of  Mississippi  and  Louisiana  primarily  in
Indiana,  which  would  also  require  additional  investment.    There are no
assurances  that  such  gaming  opportunities  will  develop  or that adequate
funding will be available for these planned investments.

In May 1996, Casino Magic, through its wholly-owned subsidiary, Jefferson Corp
acquired  Crescent  City,  for  $50  million plus the assumption of up to $5.7
million  in equipment liabilities.  Jefferson Corp paid $15 million in cash at
closing  and caused Crescent City to issue $35 million of 11.5% secured, three
year notes .  Crescent City, which was the subject of a plan of reorganization
under  Chapter  11  of the U.S. Bankruptcy Code, owned the Crescent City Queen
Riverboat  ("Crescent  City  Riverboat"),  gaming  and  related  equipment and
surveillance equipment and a license to conduct riverboat gaming operations in
Louisiana.    Crescent  City emerged from the Bankruptcy proceedings as Casino
Magic  of Louisiana, Corp. ("Louisiana Corp.")  The Company is using Louisiana
Corp.'s  gaming  license in Bossier City, Louisiana, where it owns 23 acres of
land  and  has  developed Casino Magic-Bossier City.  Although Jefferson Corp.
was  required  to purchase the Crescent City Riverboat to obtain the Louisiana
gaming  license,  the Crescent City Riverboat is one of the largest riverboats
in  the  United  States and could not be used at the Casino Magic-Bossier City
because  of  the  Crescent  City  Riverboat's  width.   Therefore, the Company
acquired  a  casino  riverboat  (the  "Bossier  Riverboat")  for use at Casino
Magic-Bossier City for $20 million.  It is the Company's intention to sell the
Crescent  City  Riverboat  and  use  the  proceeds to assist in the funding of
Casino  Magic-Bossier  City  casino  entertainment facilities or a hotel.  The
Company can give no assurances that it will be able to dispose of the Crescent
City  Riverboat on acceptable terms or in a timely manner. However, management
is  proceeding  with  options to sell the Crescent City Riverboat.  The assets
acquired  as  a  part  of  the  acquisition of Louisiana Corp., which included
gaming, surveillance and related equipment, are being used at the Bossier City
gaming site.



                                      37

<PAGE>
On  August  22,  1996, Louisiana Corp. sold $115.0 million aggregate principal
amount  of  13%  Louisiana  First  Mortgage  Notes due in 2003 with Contingent
Interest.  Interest at the rate of 13% plus Contingent Interest, is payable on
the  remaining  balance  of  the Louisiana First Mortgage Notes semi-annually,
February  15  and  August 15.  Contingent Interest is an amount equal to 5% of
the Casino Magic-Bossier City's Adjusted Consolidated Cash Flow (as defined in
the  Louisiana  Indenture)  for  the  six-month  period  ending  on June 30 or
December  31  most  recently  completed  prior  to such interest payment date,
provided  that  no  Contingent  Interest  shall be payable with respect to any
period  prior  to  the  Commencement  Date  (a  defined  term in the Louisiana
Indenture).  Payment  of  all  or  a  portion of any installment of Contingent
Interest  may  be  deferred,  at the option of the Company if, and only to the
extent that, (i) the payment of such portion of Contingent Interest will cause
the  Casino  Magic-Bossier  City's  Adjusted  Fixed  Charge  Coverage Ratio (a
defined  term  in the Louisiana Indenture) for the Casino Magic-Bossier City's
most  recently  completed Reference Period prior to such interest payment date
to  be  less  than  1.5 to 1.0 on a pro forma basis after giving effect to the
assumed  payment  of such Contingent Interest and (ii) the principal amount of
the  Louisiana  First Mortgage Notes corresponding to such Contingent Interest
has  not  then  matured  and  become due and payable (at stated maturity, upon
acceleration,  upon  redemption,  upon  maturity of a repurchase obligation or
otherwise).  The  aggregate  amount  of  Contingent  Interest  payable  in any
semiannual  period  will be reduced pro rata for reductions in the outstanding
principal  amount  of  Louisiana  First  Mortgage  Notes prior to the close of
business  on  the record date immediately preceding such payment of Contingent
Interest.
The  Louisiana  First  Mortgage  Notes  are  governed  by  an  indenture ("the
Louisiana  Indenture")  pursuant  to  which the Louisiana First Mortgage Notes
have  been  issued.    The Louisiana Indenture contains certain covenants that
limit  the  ability  of  Louisiana  Corp. and its subsidiaries to, among other
things,  incur  additional  indebtedness  and  issue  preferred  stock,  pay
dividends,  make  investments  or make other restricted payments, incur liens,
enter  into mergers or consolidations, enter into transactions with affiliates
or sell assets.
Excluding  amounts  expended  in May 1996 in connection with Jefferson Corp.'s
acquisition  of  Louisiana  Corp.  (formerly Crescent City), the total project
cost  for  Casino  Magic-Bossier  City  is estimated to be $72.6 million which
includes:  (i) approximately $13.6 million expended for the acquisition of the
23-acre  site,  (ii) $20.0 million expended for the acquisition of the Bossier
Riverboat,  and  (iii)  $39.07.8 million for the construction of buildings and
other  improvements at Casino Magic-Bossier City (including approximately $8.4
million of preopening costs, opening bankroll and additional gaming equipment,
but  excluding  estimated  fees and expenses and $10.4 million in reserves for
completion, operating expenses and fixed interest).

The  Company  opened  Casino  Magic-Bossier  City  on October 4, 1996, using a
temporary  boarding  facility,  and on December 31, 1996, opened the permanent
facility.    The  Company's  plans for the development of Casino Magic-Bossier
City  are  divided  into  two phases.  The first phase (which was completed on
December  31,  1996)  includes  a  30,000 square foot floating dockside casino
space,  with  986 slots and 44 table games; a 37,000 square foot entertainment
and


                                      38

<PAGE>
food  and  beverage  pavilion,  with  1,550 covered parking spaces and surface
parking  spaces for 400 cars.  The second phase plans include the construction
of a 60,000 square foot entertainment facility and a 400-room convention hotel
and  related  amenities,  including  restaurants,  banquet space, a theater, a
swimming  pool,  a health club and a child-care facility.  The development and
construction  of  the  second  phase  improvements  are largely dependent upon
receipt  of  proceeds  from  a  future sale of the Crescent City Riverboat and
future operating cash flow of Casino Magic-Bossier City.  No assurances can be
given  that  such  funds  will become available or that such hotel and related
facilities will ever be developed.

The  Company  is  currently constructing a hotel tower at Casino Magic-Biloxi
atop of the eight-story parking garage adjacent to the casino.  The hotel will
consist  of  approximately  378  rooms,  including approximately 86 suites and
standard  amenities  such as a swimming pool and modest conference space.  The
hotel  structure,  when  completed,  is  expected  to  be  one  of the tallest
buildings  in  Biloxi.   Construction on the hotel commenced in December 1996,
and  completion  is  estimated  for  the  first  quarter  of  1998.  The hotel
construction  costs  are  being  funded  solely out of the cash flow of Casino
Magic-BSL and Casino Magic-Biloxi.

In  early 1996, the Company, through a wholly-owned subsidiary, entered into a
consulting agreement with Sisseton-Wahpeton Dakota Nation ("Sisseton").  Under
the  agreement,  the  Company  began providing consulting services to Sisseton
relating  to  the  development and opening of the temporary casino facility on
Tribal  land.    Sisseton  opened  a  temporary  casino in November 1996.  The
agreement  also  specifies  that  the  Company  provide consulting services to
Sisseton after the opening of the temporary facility for a period of two years
and  includes  unlimited  one  year extensions.  The fee for these services is
based  on gross revenues of the  casino facility.  This agreement replaces all
previous agreements entered into between the Company and Sisseton.

In  June  1996,  Sisseton received a $17,500,000 loan ("Sisseton Loan")for the
construction  of  its planned  casino development from a consortium of lenders
of  which  the Company, through a wholly-owned subsidiary, participated in the
loan  for  up to $5 million, or a 28.6%, participation.  On July 11, 1996, the
Company  received  payment  in  full  of all outstanding amounts under a prior
bridge loan agreement with Sisseton and participated in the first draw down of
the  Sisseton  loan.    The  Company's participation in the $17.5 million loan
through  December  31,  1996, is approximately $4.9 million.  First payment of
principal and interest on this loan was received in February 1997.

In February 1997, the Company engaged an investment banking firm to assist the
Company  in  exploring  alternatives  of  a merger, joint venture or strategic
alliance  with  a  third  party  to  facilitate  the  Company  in  the  future
development  of  the  Company's  gaming  facilities,  specifically  with  the
Company's Gulf Coast properties.

The  Company  commenced  operations in 1995 outside the United States becoming
subject  to certain risks including foreign currency exchange, repatriation of
earnings  and  profits,  and  adverse foreign tax treatment.  In addition, the
Company  will  incur  the  general  business risk associated with operating in
foreign  countries where culture and business practices may vary significantly
from  that  in  the United States.  Such risks could have a material impact on
the operating results and liquidity of the Company.
                                      39

<PAGE>
At September 30, 1996, management determined that its 49% equity investment in
Porto Carras Casino S.A. and notes and accounts receivables relating to unpaid
management  fees  and royalties had been impaired. Because of this impairment,
management  wrote  off its investment in the gaming facility in Porto Carras.
In  December  1996 the Company sold its shares of common stock in Porto Carras
in December 1996 for a nominal amount.

The  Company will have a significant need for cash in 1997 and beyond in order
to  continue  its  planned  pursuit  of gaming opportunities and the continued
development  of  its  existing properties.  The Company believes that cash and
marketable securities at December 31, 1996, cash flows from operations will be
sufficient  to service its operating and debt service requirements, as well as
the  planned  1997 construction activities relating to the Casino Magic-Biloxi
hotel,  through  at  least  the  next twelve months, but are not sufficient to
engage  in  any other development activities without additional debt or equity
financing.   Under the terms of the indenture associated with the $135,000,000
First  Mortgage  Notes,  Casino  Magic  Corp., Mardi Gras Casino Corp., Biloxi
Casino Corp. and Casino Magic Finance Corp. have certain restrictions relative
to  additional  borrowings and guarantees.  Jefferson Corp and Louisiana Corp.
have  certain  restrictions  relative  to  additional borrowings and cash flow
under the terms of the Louisiana Indenture associated with the Louisiana First
Mortgage Notes.

ITEM 8.     FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The consolidated financial statements of Casino Magic and subsidiaries and the
notes  thereto  are  attached  to  this  Annual Report and are incorporated by
reference in response to this Item 8.

ITEM 9.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
            FINANCIAL DISCLOSURE
None.




                                     40

<PAGE>
                                   PART III

ITEM 10.     DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The  discussion  under  the  section  captioned  "Proposal No. 1 - ELECTION OF
DIRECTORS" to be included in the Registrant's definitive proxy statement to be
filed with the Securities and Exchange Commission ("SEC") and delivered to the
Registrant's  shareholders  pursuant  to  Regulation 14A promulgated under the
Securities  Exchange  Act of 1934, as amended ("Regulation 14A"), with respect
to  the  1996  annual  meeting  of  shareholders  of  the  Registrant  ("1996
Shareholders  Meeting")  is incorporated by reference in response to this Item
10.

ITEM 11.     EXECUTIVE COMPENSATION
The  discussion  under  the  section  captioned  "EXECUTIVE  COMPENSATION" but
excluding  the  discussions  contained in the subsections captioned "EXECUTIVE
COMPENSATION  -  Compensation  Committee Report on Executive Compensation" and
"EXECUTIVE  COMPENSATION  -  Performance  Graph",  to  be  included  in  the
Registrant's definitive proxy statement to be filed with the SEC and delivered
to  the  Registrant's  shareholders pursuant to Regulation 14A with respect to
the 1996 Shareholders Meeting is incorporated by reference in response to Item
11.

ITEM 12.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The  discussion  under  the  section  captioned "PRINCIPAL SHAREHOLDERS" to be
included  in  the Registrant's definitive proxy statement to be filed with the
SEC  and delivered to the Registrant's shareholders pursuant to Regulation 14A
with  respect to the 1996 Shareholders Meeting is incorporated by reference in
response to Item 12.

ITEM 13.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The  discussion  under  the  section  captioned  "CERTAIN  TRANSACTIONS" to be
included  in  the Registrant's definitive proxy statement to be filed with the
SEC  and delivered to the Registrant's shareholders pursuant to Regulation 14A
with  respect to the 1996 Shareholders Meeting is incorporated by reference in
response to Item 13.
                                   PART IV

ITEM 14.     EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(A) 1.   FINANCIAL STATEMENTS OF CASINO MAGIC CORP. AND ITS SUBSIDIARIEs

     Independent Auditors' Report of Arthur Andersen LLP.

    Consolidated Balance Sheets as of December 31, 1996 and 1995.

    Consolidated Statements of Operations - years ended December 31, 1996,
    1995, and 1994.

    Consolidated Statements of Shareholders' Equity - years ended December 31,
    1996, 1995, and 1994.

    Consolidated Statements of Cash Flows - years ended December 31, 1996,
    1995, and 1994.

Notes to Consolidated Financial Statements.

                                      41

<PAGE>
2.  FINANCIAL STATEMENT SCHEDULES OF CASINO MAGIC CORP. AND ITS SUBSIDIARIEs

All schedules are omitted because they are not applicable, or not required, or
the information is included in the Consolidated Financial Statements of Casino
Magic Corp. and its subsidiaries.

(B) REPORTS ON FORM 8-K
No  reports  on Form 8-K have been filed during the fourth quarter of the year
ended December 31, 1996.

(C) EXHIBITs

3(i)(a)(1)               Articles of Incorporation of Casino Magic Corp.
3(i)(b)(2)               Articles of Amendment to Articles of Incorporation of
Casino Magic Corp.
3(ii)(a)(1)        By-Laws of Casino Magic Corp. as amended.
3(ii)(b)(10)      Amendment dated April 4, 1995 to the By-Laws of Casino Magic
Corp.
3(ii)(c)       Amendment dated August 11, 1995 to the By-Laws of  Casino Magic
Corp.
4.1(5) Form of Certificate for Common Stock of Casino Magic Corp.
4.2(4 )Form of 11.5% First Mortgage Note due 2001 Series B.
4.3(2)  Indenture  Dated  October  14,  1993 among Casino Magic Finance Corp.,
Casino Magic Corp., and IBJ Schroder Bank & Trust Company (Without Exhibits).
     4.4     Deleted
     4.5    Deleted
4.6(6)  Form  of  Warrant  issued to Summit Investment Corporation and related
persons for the purchase of an aggregate of 1,110,000 shares of Common Stock.
    4.7(19)  Indenture  dated  as  of may 13, 1996, $35,000,000 11 1/2% Senior
Secured Notes
         due 1999.
4.8(18)    Form  of  Casino  Magic of Louisiana Corp.'s ("Louisiana Corp") 13%
First  Mortgage  Notes  due  2003  with  Contingent  Interest in the aggregate
principal amount of $115,000,000.
    4.9(18)    Form of Guarantee issued on August 22, 1996 by Jefferson Casino
Corporation.
4.10(18)  Indenture  dated  as of August 22, 1996 by and among Louisiana Corp,
First Union Bank of Connecticut, as Trustee, and the Guarantors named therein,
for  Louisiana  Corp.'s $115,000,000 of 13% First Mortgage Notes due 2003 with
Contingent Interest.
                                             42
<PAGE>

4.11(18)  Registration  Rights  Agreement  dated  as of August 22, 1996 by and
among  Louisiana Corp, the Guarantors named therein and the Initial Purchasers
named therein.
4.12(18)  Cash  Collateral and Disbursement Agreement dated August 22, 1996 by
and  among  Louisiana  Corp,  First Union Bank of Connecticut, as Trustee, and
First National Bank of Commerce, as disbursement agent.
4.13(18)  Security  Agreement dated as of August 12, 1996 by and between First
Union Bank of Commecticut, as Trustee, and Louisiana Corp, as Guarantor.
4.14(18)  Stock  Pledge dated as of August 22, 1996 by and between First Union
Bank of Connecticut, as Trustee, and Jefferson Casino Corporation, as Pledgor.
4.15(18)  Security Agreements dated as of August 22, 1996 by and between First
Union Bank of Connecticut, as Trustee, and Jefferson Casino Corporation.
4.16(18)  First  Preferred Ship Mortgages dated as of August 22, 1996 executed
in favor of First Union Bank of Connecticut, as Trustee, by Louisiana Corp.
4.17(18)  First  Preferred Ship Mortgages dated as of August 22, 1996 executed
in favor of First Union Bank of Connecticut, as Trustee, by Louisiana Corp.
4.18(18)  Mortgage  of Louisiana Corp. dated as of August 22, 1996 executed in
favor of First Union Bank of Connecticut, as Trustee.
4.19(18) Cash Collateral and Disbursement Agreement.
4.20(18) Form of Accounts Pledge Agreement.
4.21(18) Note Purchase Agreement dated August 16, 1996.
4.22(18) Collateral Assignment dated August 22, 1996.
10.1(1)*  Employment  Agreement  dated June 1, 1992 between Marlin F. Torguson
and Casino Magic Corp., and Amendment No. 1 thereto dated August 26, 1992.
10.2(9)* Amendment No. 2 dated August 26, 1994 to Employment Agreement between
Marlin F. Torguson and Casino Magic Corp.
     10.3  Deleted
     10.4  Deleted
     10.5  Deleted
10.6(a)(1)* Incentive Stock Option Plan.
                                      43
<PAGE>

10.6(b)(2)* Amendment adopted on May 13, 1993 to Incentive Stock Option Plan.
10.6(c)(2)* Amendment adopted on May 14, 1993 to Incentive Stock Option Plan.
10.7(1)  Lease  Agreement  dated April 4, 1992 between G & W Enterprises, Inc.
and Biloxi Casino Corp.
     10.8  Deleted
     10.11  Deleted
10.12(2) Public Trust Tidelands Lease dated May 27, 1993 between Biloxi Casino
Corp. and the State of Mississippi.
10.13(2)  Lease  Agreement dated November 23, 1992 between Gary Gollott, Tommy
Gollott and Tyrone Gollott, and Biloxi Casino Corp.
10.14(2)  Promissory  Note  dated  October  14,  1993  in the principal sum of
$67,500,000 issued by Mardi Gras Casino Corp. in favor of Casino Magic Finance
Corp.
10.15(2)  Promissory  Note  dated  October  14,  1993  in the principal sum of
$67,500,000  issued  by  Biloxi  Casino Corp. in favor of Casino Magic Finance
Corp.
10.16(2)  Guaranty dated October 14, 1993 by Mardi Gras Casino Corp. of Biloxi
Casino Corp. Note.
10.17(2)  Guaranty dated October 14, 1993 by Biloxi Casino Corp. of Mardi Gras
Casino Corp. Note.
10.18(2)  First and Second Deeds of Trust dated October 14, 1993 by Mardi Gras
Casino Corp. in favor of Casino Magic Finance Corp.
10.19(2)  First  and  Second  Deeds  of Trust dated October 14, 1993 by Biloxi
Casino Corp. in favor of Casino Magic Finance Corp.
10.20(2)  First and Second Leasehold Deeds of Trust dated October 14, 1993 for
G&W Lease.
10.21(2)  First and Second Leasehold Deeds of Trust dated October 14, 1993 for
Gollott Lease.
10.22(2)First  and  Second Leasehold Deeds of Trust dated October 14, 1993 for
State of Mississippi Lease.
10.23(2) Assignments of Deeds of Trust dated October 14, 1993.
10.24(2)  Pledge and Security Agreement I & II dated October 14, 1993 of Mardi
Gras Casino Corp.
                                      44
<PAGE>

10.25(2) Pledge and Security Agreement I & II dated October 14, 1993 of Biloxi
Casino Corp.
10.26(2)  Assignment  and  Pledge  Agreement  dated October 14, 1993 of Casino
Magic Finance Corp.
     10.27    Deleted
     10.28    Deleted
     10.29    Deleted
     10.30    Deleted
     10.31    Deleted
10.32(5)Option Agreement dated March 2, 1994 between Anthony's Hawthorne, Inc.
and Boston Casino Corp.
10.33(5)Option  Mortgage  dated  March 2, 1994 by Anthony's Hawthorne, Inc. in
favor of Boston Casino Corp.
10.34(5)Guaranty  dated  March  2,  1994  by  Casino  Magic  Corp. in favor of
Anthony's Hawthorne, Inc.
10.35(5)Option  Agreement  dated  July 2, 1993 between Atlantic Land Corp. and
Casino Magic Corp. to acquire real estate located in Mobile, Alabama.
10.36(5)Option  Agreement  dated  July 13, 1993 between Marshall J. Demouy and
Edward  F.  Murray,  Jr.,  as  Trustees and Casino Magic Corp. to acquire real
estate located in Mobile, Alabama.
  10.37(5)Option Agreement dated July 13, 1993 between Marshall J. Demouy and
   Edward F. Murray, Jr., as Trustees and Casino Magic Corp. to acquire real
                      estate located in Mobile, Alabama.
10.38(5)Option  to  Lease  Real  Estate  dated  December  11,  1993  between
Opportunity  Options, Inc. and Casino Magic Corp. to lease real estate located
in Crawford County, Indiana.
    10.39     Deleted
    10.40     Deleted
    10.41     Deleted
    10.42     Deleted
    10.43     Deleted
10.44(8)*Employment  Agreement  dated  September  1,  1994  between  Robert A.
Callaway and Casino Magic Corp.
    10.45     Deleted
    10.46     Deleted
    10.47     Deleted
                                      45
<PAGE>

    10.48(9)  Deleted
10.49(9)Agreement  (architectural  and  design  services)  dated April 1, 1993
between Mardi Gras Casino Corp. and Palmer Course Design Company.
10.50(9)Concession  Contract  for  the  Management, Operation, Maintenance and
Related  Services  of the Gaming Houses of the Provincial Casino in the Cities
of  Neuqu  n  and  San Martin De Los Andes dated December 21, 1994 between the
Province of Neuqu n and Casino Magic Neuqu n, S.A. (English translation).
 10.51(9)Option  Agreement dated May 25, 1994 among Camptown Greyhound Racing,
Inc.,  the Racing Association of Kansas Southeast, and Kansas Gaming Partners,
L.L.C., as amended.
10.52(9)Option Agreement dated February 14, 1995 among Estate of
Janice Small, Ronald W. Brewer, executor, and Casino Magic Corp.
10.53(9)Option  Agreement dated January 11, 1994 between Terry Roser and Eddie
P. Roser (collectively) and Casino Magic Corp.
     10.54   Deleted
10.55(9)Agreement  of  Sale  dated June 10, 1994 between Township of Bensalem,
Bucks County, Pennsylvania and Bucks County Casino Corp.
10.56(9)Consulting  Agreement  between  Casino Magic Corp. and National Gaming
Consultants, Inc. dated January 15, 1994.
     10.57  Deleted
     10.58  Deleted
10.59(9)Operating  Agreement  of Kansas Gaming Partners, L.L.C. dated November
23, 1994
10.60(9)  Operating  Agreement  of  Kansas  Financial  Partners,  L.L.C. dated
November 23, 1994
10.61(9)  Promissory  Note  dated  November  28,  1994 in the principal sum of
$3,205,000  issued  by  Camptown  Greyhound Racing, Inc. in favor of Boatmen's
First National Bank of Kansas City.
10.62(9)  Guaranty  dated  November  28,  1994  executed  by  Kansas Financial
Partners, L.L.C.
10.63(9)  Certificate  of  Deposit  Pledge  and  Security  Agreement of Kansas
Financial Partners, L.L.C. dated November 28, 1994.
10.64(9)  Option Agreement dated January 11, 1994 between Tower Orchards, Inc.
and Casino Magic Corp.
     10.65  Deleted
     10.66  Deleted
                                      46

<PAGE>
     10.67  Deleted
10.68  Deleted
10.69(13)Stock  Exchange  Agreement  between  Casino  Magic  Corp.  and Gaming
Corporation of America dated May 10, 1995 (without exhibits or schedules)
10.70(11)Memorandum  of  Agreement  among Touristiki Georgiki Exagogiki, S.A.,
Parral  Compania  Naviera,  S.A. and Casino Magic (Europe) B.V. dated June 21,
1995.
10.71(11)Management  Agreement  between Agrotiki, Viomichaniki Macedonias S.A.
and Casino Magic (Europe) B.V. dated May 31, 1995.
10.72(11)Management  Agreement between Koinopraxia, Casino Doiranis and Casino
Magic (Europe) B.V. dated June 22, 1995.
10.73(11)Amendment  Number One dated April 29, 1995 to Joint Venture Agreement
among  Touristiki  Georgiki  Exagogiki,  S.A.,  Parral Compania Naviera, S.A.,
Casino  Magic (Europe) B.V., Casino Management Services Corp. and Casino Magic
Corp.
10.74(11)Management Agreement dated April 29, 1995 between Porto Carras Casino
S.A. and Casino Magic (Europe) B.V.
10.75(11)Agreement  dated  April 29, 1995 among Touristiki Georgiki Exagogiki,
S.A.,  Parral  Compania  Naviera,  S.A.,  Casino  Magic  (Europe) B.V., Casino
Management Services Corp. and Casino Magic Corp. relating to the Joint Venture
Agreement.
10.76(11)Management Fee Agreement dated April 29, 1995 between Parral Companis
Naviera, S.A. and Casino Magic (Europe) B.V.
10.77(11)Extension of Exclusive Option to Purchase dated June 26, 1995 between
Atlantic  Land  Corp. and Casino Magic Corp. to acquire real estate located in
Mobile, Alabama.
10.78(11)Registration  Agreement  dated  June  26,  1995 between Atlantic Land
Corp. and Casino Magic Corp.
10.79(11)Stock  Option  Agreement  dated  June  26, 1995 between Atlantic Land
Corp. and Casino Magic Corp.
10.80(11)*Separation  Agreement  dated April 17, 1995 between Allen J. Kokesch
and Casino Magic Corp.
10.81(12)*Employment  Agreement  dated October 2, 1995 between the Company and
Jay  S. Osman
10.82(12)Lease  Agreement dated September 29, 1995 between the Company and the
State of  Mississippi
10.83(12)Memorandum  of  Understanding dated May, 1995 between the Company and
Lakes Region  Greyhound Park.
                                      47

<PAGE>
10.84(12)Stock  Exchange Agreement dated October 26, 1995 between Casino Magic
Corp. and Mark G. George.
10.85(12)Registration Agreement dated October 26, 1995 between the Company and
Mark G. George.
10.86(13)Stock Exchange Agreement dated May 10, 1995 between the Company,  and
Gaming Corporation of America.
10.87(12)Registration Agreement dated October 26, 1995 between the Company and
Belle Cherri Land Co.
10.88(13)Registration  Agreement  between  Casino  Magic  Corp.  and  Gaming
Corporation of America dated May 26, 1995.
10.89(14)Stock  Exchange Agreement among Casino Magic Corp., Belle Cherri Land
Co. and Cherryll Young Arnold dated September 13, 1995.  (Excluding exhibits).
10.90(14)      Stock Exchange Agreement between Casino Magic Corp. and Mark G.
George dated October 26, 1995 (Excluding exhibits).
10.91(15)Consulting  Agreement  between  Casino  Magic  American Corp. and the
Sisseton-Wahpeton Sioux Tribe dated March 13, 1996.
10.92(15)Employment  Agreement  between  Casino Magic Corp. and James E. Ernst
dated December 20, 1995.
10.93(15)*  Promissory  Note evidencing indebtedness owed by James E. Ernst to
Casino Magic Corp. dated December 20, 1995.
10.94(15)* Termination Agreement between Casino Magic Corp. and Dual B. Cooper
dated December 18, 1995.
10.95(15)Purchase  Agreement  between  Casino  Magic  Corp.,  Jefferson Casino
Corporation,  C-M  of  Louisiana,  Inc. and Capital Gaming International, Inc.
dated February 21, 1996. [Crescent City].
10.96(15)Amendment  to  an  option  agreement  between Boston Casino Corp. and
Anthony's Hawthorne, Inc. dated January 22, 1996.
10.97  Deleted
10.98(15)Non-Statutory  Stock Option Agreement dated December 20, 1995 between
James E. Ernst and Casino Magic Corp.
10.99(16)   Agreement dated May 3, 1996 between Mark G. George, Stuart Capital
Corporation,  Southeast  Gaming Corporation, Casino Magic Corp., and Jefferson
Casino Corp. for purchase of Gaming Fee and Option Agreement.
     10.100(16)  Promissory  Note  dated  May 3, 1996 between Jefferson Casino
Corporation,
          C-M of Louisiana, Inc. and Mark G. George.
     10.101(16)  Release dated May 3, 1996 by Mark G. George of Gaming Fee and
Option
         Agreement.
                                      48
<PAGE>

     10.102(16)  Subordination  Agreement  dated May 3, 1996 between Jefferson
Casino
        Corporation, C-M of Louisiana, Inc. and Mark G. George.
10.103(17) Loan Participation Agreement dated June 28, 1996 by and between BNC
National Bank and Casino Magic American Corp.
10.104*  Employment  Agreement  dated  June  25,  1996 between Ken Schultz and
Casino Magic Corp.
10.105*  Employment  Agreement  dated  July  2,  1996 between Juris Basens and
Casino Magic Corp.
10.106*  Employment  Agreement  dated  July 11, 1992 between David Paltzik and
Casino Magic Corp
10.107  Agreement dated December 12, 1996 among Touristiki Georgiki Exagogiki,
S.A.,  Parral Compania Naviera, S.A., Casino Magic (Europe) B.V., Casino Magic
Hellas  Management  Services  S.A.  and  Casino  Magic  Corp.  relating to the
termination  of  Joint  Venture Agreement and the Management Agreement between
the parties.
10.108  Agreement dated December 12, 1996 among Touristiki Georgiki Exagogiki,
S.A.,  Parral Compania Naviera, S.A., Casino Magic (Europe) B.V., Casino Magic
Hellas  Management Services S.A., Casino Magic Corp.  and Murbec Inc. relating
to the purchase of Porto Carras Casino S.A.
10.109  Admendment  to  Operating  Agreement of Kansas Gaming Partners, L.L.C.
dated January 22, 1997.
18.        Letter  from  Arthur  Andersen  LLP  regarding change in accounting
principal or practice.
21.1   Subsidiaries of Casino Magic Corp.
23.1   Consent of Independent Public Accountants.
24.1   Power of Attorney (contained on the signature page).
     27.    Financial Data Schedule (filed electronically only).
* Indicates management contracts and compensatory plans and arrangements.
(1)  Incorporated by reference to the Registrant's Registration Statement (No.
33-51438) on Form S-1 dated August 28, 1992.
(2)  Incorporated by reference to the Registrant's Registration Statement (No.
33-71572) on Form S-4 dated November 12, 1993.
(3)    Incorporated  by  reference  to  Amendment  No.  1  to the Registrant's
Registration Statement (No. 33-71572) on Form S-4 dated December 22, 1993.
(4)    Incorporated  by  reference  to  Amendment  No.  2  to the Registrant's
Registration Statement (No. 33-71572) on Form S-4 dated February 3, 1994.
(5)   Incorporated by reference to the Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1993.
                                      49
<PAGE>

(6)    Incorporated  by  reference  to  Amendment  No.  3  to the Registrant's
Registration Statement (No. 33-51438) on Form S-1 dated October 21, 1992.
(7)    Incorporated  by reference to the Registrant's Quarterly Report on Form
10-Q for the period ended March 31, 1994.
(8)    Incorporated  by reference to the Registrant's Quarterly Report on Form
10-Q for the period ended September 30, 1994.
(9)   Incorporated by reference to the Registrant's Annual Report on Form 10-K
for the Fiscal Year ended December 31, 1994.
(10)    Incorporated by reference to the Registrant's Quarterly Report on Form
10-Q for the period ended March 31, 1995.
(11)    Incorporated by reference to the Registrant's Quarterly Report on Form
10-Q for the period ended June 30, 1995.
(12)    Incorporated by reference to the Registrant's Quarterly Report on Form
10-Q for the period ended September 30, 1995.
(13)   Incorporated by reference to a Registration Statement (No. 33-93650) of
Casino Magic Corp. filed on June 19, 1995.
(14)   Incorporated by reference to a Registration Statement (No. 33-99248) of
Casino Magic Corp. on Form S-3 filed November 9, 1995.
(15)    Incorporated  by reference to Registrant's Annual Report on  Form 10-K
for the period ended December 31, 1995.
(16)   Incorporated by reference to Registrant's Quarterly Report on Form 10-Q
for the period ended March 31, 1996.
(17)   Incorporated by reference to Registrant's Quarterly Report on Form 10-Q
for the period ended June 30, 1996.
(18)    Incorporated  by  reference  to  Casino  Magic  of  Louisiana  Corp.
Registration Statement (No. 333-14535) on Form S-4 dated October 21, 1996.
(19)    Incorporated  by  reference  to the Registrants Form 8-K filed May 28,
1996.
(D)    Financial Statements required by Regulation S-X which are excluded from
the Annual Report to Shareholders.
       None.

                                      50

<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 Report to be signed on its
behalf by the undersigned, thereunto duly authorized.

                                             CASINO MAGIC CORP.

Dated:  March 25, 1997                         By: /s/ James E. Ernst
                                                   James E. Ernst., President
                                                   and Chief Executive Officer
POWER OF ATTORNEY

KNOW  ALL  PERSONS BY THESE PRESENTS, that each person whose signature appears
below  constitutes  and  appoints  Marlin  F.  Torguson and James E. Ernst, or
either  of  them, as his true and lawful attorney-in-fact and agent, with full
power of substitution and resubstitution, for him and in his name, place and
stead,  in  any  and  all  capacities,  to sign any and all amendments to this
Annual  Report  on Form 10-K, and to file the same, with all exhibits thereto,
and  other documents in connection therewith, with the Securities and Exchange
Commission,  granting  unto  said  attorney-in-fact  and  agent full power and
authority  to  do  and  perform  each  and  every  act and thing requisite and
necessary  to  be  done  in  connection therewith, as fully to all intents and
purposes  as  he  might or could do in person, hereby ratifying and confirming
all  that  said  attorney-in-fact and agent, or his substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.

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

Signature                                Title
Date


/s/  Marlin  F.  Torguson              Chairman of the Board       March 25,
1997
Marlin F. Torguson


/s/  James  E.  Ernst                  President and Chief         March 25,
1997
James E. Ernst                      Executive Officer
                                    (principal executive officer)


/s/  Jay  S.  Osman                    Chief Financial             March 25,
1997
Jay S. Osman                        Officer and Treasurer (principal
                                    financial and accounting officer)


/s/  Roger  H.  Frommelt               Director                    March 25,
1997
Roger H. Frommelt


/s/E.  Thomas  Welch                   Director                    March 25,
1997
E. Thomas Welch
                                     51

<PAGE>
                              CASINO MAGIC CORP.
       ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 1996

                             INDEX TO EXHIBITS

Exhibit
Number
Page
------------------------------------------------------------------------------
10.99* Employment Agreement dated June 25, 1996 between Ken Schultz and Casino
Magic Corp.
10.100*  Employment  Agreement  dated  July  2,  1996 between Juris Basens and
Casino Magic Corp.
10.101*  Employment  Agreement  dated  July 11, 1992 between David Paltzik and
Casino Magic Corp
10.102  Agreement dated December 12, 1996 among Touristiki Georgiki Exagogiki,
S.A.,  Parral Compania Naviera, S.A., Casino Magic (Europe) B.V., Casino Magic
Hellas  Management  Services  S.A.  and  Casino  Magic  Corp.  relating to the
termination  of  Joint  Venture Agreement and the Management Agreement between
the parties.
10.103  Agreement dated December 12, 1996 among Touristiki Georgiki Exagogiki,
S.A.,  Parral Compania Naviera, S.A., Casino Magic (Europe) B.V., Casino Magic
Hellas  Management Services S.A., Casino Magic Corp.  and Murbec Inc. relating
to the purchase of Porto Carras Casino S.A.
10.104  Admendment  to  Operating  Agreement of Kansas Gaming Partners, L.L.C.
dated January 22, 1997.
21.1  Subsidiaries of Casino Magic Corp.

23.1  Consent of Independent Public Accountants.

24.1  Power of Attorney (contained on the signature page).



















                                      52

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


                                                                         PAGE

Report of Independent Public Accountants                                 F-2

Consolidated Statements of Operations                                    F-3

Consolidated Balance Sheets - Assets                                     F-4

Consolidated Balance Sheets - Liabilities and Shareholders' Equity       F-5

Consolidated Statements of Shareholders' Equity                          F-6

Consolidated Statements of Cash Flows                                    F-8

Notes to Consolidated Financial Statements                               F-11

<PAGE>
                   REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To the Board of Directors of Casino Magic Corp.:

       We  have audited the accompanying consolidated balance sheets of Casino
Magic  Corp.  (a  Minnesota  corporation) and subsidiaries (the Company) as of
December  31,  1996  and  1995,  and  the  related  consolidated statements of
operations, shareholders' equity and cash flows for each of the three years in
the  period  ended  December 31, 1996. These consolidated financial statements
are  the responsibility of the Company's management.  Our responsibility is to
express  an  opinion  on  these consolidated financial statements based on our
audits.

         We  conducted  our  audits  in  accordance  with  generally  accepted
auditing standards. 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 Casino Magic Corp.
and  subsidiaries  as  of December 31, 1996 and 1995, and the results of their
operations  and  their  cash  flows  for each of the three years in the period
ended  December  31,  1996  in  conformity  with generally accepted accounting
principles.




ARTHUR ANDERSEN LLP


New Orleans, Louisiana
February 28, 1997
















                                     F-2

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                    CONSOLIDATED STATEMENTS OF OPERATIONS

                                      YEARS ENDED DECEMBER  31,
                                    1996         1995          1994
REVENUES:
  Casino                        167,153,012    165,997,836    178,336,647
  Food and beverage and rooms     8,080,067      8,392,529      5,625,703
 Royalty and management fees     3,099,407       2,224,351             --
  Other  operating  revenues                1,945,357      1,108,049
1,056,125
                                180,277,843        177,722,765
185,018,475
COSTS AND EXPENSES:
  Casino                         74,943,304     69,654,888     73,212,895
  Food and beverage               7,351,838      6,795,164      6,412,264
  Rooms                           1,039,081      1,224,685        198,112
 Other operating costs and
  expenses                        2,807,038      1,333,183      1,601,792
  Advertising and marketing      20,901,821     25,873,832     25,097,126
  General and administrative     24,216,613     28,501,308     29,765,041
 Property operation, maintenance
  and energy cost                 7,433,262      4,057,144      7,632,034
 Rents, property taxes and
  insurance                       5,991,261       4,314,355      3,475,089
  Depreciation and amortization  18,346,202      15,768,546     10,668,770
  Preopening costs                6,554,535       1,818,715             --
  Development expenses            1,849,583       2,228,549     10,244,317
  Write-off of capitalized costs
  relating to inactive
    developments                                  --      11,381,945
5,479,164
                                171,434,538     172,952,314    173,786,604
INCOME  FROM  OPERATIONS                    8,843,305       4,770,451
11,231,871
OTHER (INCOME) EXPENSE:
  Interest expense               25,071,767      17,436,904     16,645,963
  Interest capitalized           (5,717,494)       (867,236)    (1,306,476)
  Interest income                (1,436,468)       (803,624)    (1,403,692)
  Loss from unconsolidated
    subsidiaries                 26,501,808         112,250        407,787
  Write-off of capitalized costs
    primarily   relating to
    joint ventures                        --      2,210,219             --
  Other                                     689,221        204,981
106,779
                                           45,108,834     18,293,494
14,450,361
LOSS BEFORE INCOME TAXES         (36,265,529)   (13,523,043)    (3,218,490)

INCOME  TAX  BENEFIT                      (4,676,182)    (3,230,864)
(188,039)
NET  LOSS                                 $(31,589,347)  $(10,292,179)  $
(3,030,451)
NET LOSS PER COMMON SHARE:
   PRIMARY                          $      (0.88)  $       (.30)  $
(.10)
   FULLY-DILUTED                $(0.89)  $       (.31)  $       (.11)
AVERAGE SHARES AND EQUIVALENTS OUTSTANDING:
   PRIMARY                                  36,039,909    34,179,842
28,934,185
   FULLY-DILUTED                            35,448,068    33,260,904
27,314,172

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
                                     F-3

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                         CONSOLIDATED BALANCE SHEETS

                                    ASSETS
                                                        DECEMBER 31,
                                                     1996         1995

CURRENT ASSETS:
     Cash and cash equivalents                    $ 17,561,512   $ 30,755,698
     Restricted Cash                                16,984,654             --
Income tax receivable                             802,174      4,225,047
Prepaid expenses                                2,844,995      2,671,210
     Notes and accounts receivable, net              2,889,486      6,879,080
     Deferred income taxes                               --         2,923,171
     Other  current  assets                                  873,676
626,846

      Total current assets                       41,956,497     48,081,052

PROPERTY AND EQUIPMENT, NET                     243,692,571    169,791,757

OTHER LONG-TERM ASSETS:
  Notes Receivable                                4,119,700             --
  Investments in unconsolidated subsidiaries        957,831     18,574,859
  Options and land deposits                       2,282,244      3,211,562
  Foreign casino concession agreement, net of
    accumulated amortization of $1,897,790 in
    1996 and $948,895 in 1995                     9,488,950     10,437,845
  Deferred gaming license cost, net of
    accumulated amortization of $395,489
    in 1996                                      38,337,333             --
  Property held for development                   3,040,357      3,540,357
  Property held for sale                         15,108,541      5,118,740
  Debt issuance costs, net of accumulated
    amortization of $1,160,478 in 1996 and
    $994,350 in 1995                             10,195,688      5,936,591
  Deposits and other                              1,421,979      3,738,079

      Total  other  long-term  assets                        84,952,623
50,558,033

                                                             $370,601,691
$268,430,842


SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.









                                     F-4

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                   CONSOLIDATED BALANCE SHEETS (CONTINUED)

                    LIABILITIES AND SHAREHOLDERS' EQUITY

                                                          DECEMBER 31,
                                                     1996          1995
CURRENT LIABILITIES:
  Notes and contracts payable                   $  4,708,603   $   964,174
  Current maturities of long-term debt             4,648,638     3,595,745
  Accounts payable                                 7,945,068     4,098,992
  Accrued expenses                                11,320,101    10,853,261
  Accrued interest                                 8,830,040     3,476,947
  Accrued payroll and related benefits             8,341,720     7,150,253
  Accrued progressive gaming liabilities           1,121,623     1,071,760
  Other current liabilities                        1,533,192       959,609

      Total current liabilities                   48,448,985    32,170,741

DEFERRED INCOME TAXES                                266,761     3,991,325

OTHER LONG-TERM LIABILITIES                               --       250,000

LONG-TERM DEBT, NET OF CURRENT MATURITIES        258,261,231   136,840,010

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY:
  Common stock, $0.01 par, 50,000,000 shares,
    authorized 35,637,083 issued and outstanding
    in 1996 and 35,279,564 issued and outstanding
    in 1995                                          356,371       352,796
  Undesignated stock, 2,500,000 shares
    authorized, None issued                               --            --
  Additional paid-in capital                      67,123,702    66,087,413
  Retained earnings (deficit)                     (2,513,062)   29,076,285
  Cumulative foreign currency translation
    adjustment                                            --      (224,195)
  Unrealized holding loss on securities             (850,156)           --
  Less  unearned  compensation                                (492,141)
(113,533)

      Total  shareholders'  equity                            63,624,714
95,178,766

                                                              $370,601,691
$268,430,842
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.








                                     F-5

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES
                CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
                                                                     Foreign
                                  Common Stock       Additional      currency
                                          Shares     Amount   paid-in capital
adjustment
BALANCE AT DECEMBER 31, 1993  25,215,000    $252,150   $25,005,578         --
Amortization of unearned
  compensation                        --          --            --         --
Stock options granted to
  executive officers                  --          --     1,190,625         --
Net proceeds from exercise of
  warrants                     2,873,500      28,735     4,352,685         --
Net proceeds from exercise of
  employee stock options         155,250       1,553       227,835         --
Net proceeds from common stock
  issued pursuant to
  Regulation S                 1,700,000      17,000    10,156,000         --
Stock issued for consultants
  compensation                     18,000         180       194,445        --
Net  loss                                --          --            --
--
BALANCE AT DECEMBER 31, 1994   29,961,750    $299,618   $41,127,168        --
Amortization of unearned
  compensation                         --          --            --        --
Write-off of unearned
  compensation                         --          --    (1,642,886)       --
Stock options to executive officers    --          --       101,563        --
Vested stock grants to
  executive officers               16,250          162         (162)       --
Net proceeds from exercise of
  stock options                   308,564        3,086      376,726        --
Net proceeds from common stock
issued pursuant to Regulation S 1,771,000       17,710    8,303,095        --
Stock issued for consultants'
  compensation                    12,000          120       63,632         --
Stock issued for land          3,210,000       32,100   17,758,277         --
Foreign currency translation          --           --           --   (224,195)
Net  loss                               --           --           --
--
BALANCE  AT  DECEMBER  31,  1995    35,279,564         $352,796  $66,087,413
($224,195)
Amortization of unearned
  compensation                        --           --           --         --
Stock options granted to
  executive officers                  --           --      567,188         --
Net proceeds from exercise
  of warrants                         --           --          500         --
Net proceeds from exercise of
  employee and non-employee
  director stock options         357,519        3,575      453,654         --
Casino One Corp. acquisition          --           --       14,947         --
Unrealized Holding Loss on
  Securities Available for Sale       --           --           --         --
Foreign currency translation
  adjustment                          --           --           --    224,195
Net  loss                                --           --           --
--
BALANCE AT DECEMBER 31, 1996  35,637,083     $356,371  $67,123,702  $
    --
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
                                     F-6

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES
         CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (CONTINUED)
                    UNREALIZED HOLDING     RETAINED       LESS
                     loss on securites    (deficit)     unearned
                          available for sale    earnings     compensation
Total
BALANCE  AT  DECEMBER  31,  1993  $          --    $42,398,915     $(798,306)
$66,858,337
Amortization of unearned
  compensation                     --            --       770,180     770,180
Stock options granted to
  executive officers               --            --    (1,190,625)         --
Net proceeds from exercise of
  warrants                         --            --            --   4,381,420
Net proceeds from exercise of
  employee stock options           --            --            --     229,388
Net proceeds from common stock
  issued pursuant to
  Regulation S                     --            --            --  10,173,000
Stock issued for consultants
  compensation                     --            --            --     194,625
Net  loss                                     --    (3,030,451)           --
(3,030,451)
BALANCE AT DECEMBER 31, 1994 $     --   $39,368,464  $(1,218,751) $79,576,499
Amortization of unearned
  compensation                         --          --      470,962     470,962
Write-off of unearned
  compensation                         --          --      735,819   (907,067)
Stock options to executive officers    --          --     (101,563)         --
Vested stock grants to
  executive officers                   --          --          --          --
Net proceeds from exercise of
  stock options                        --          --          --      379,812
Net proceeds from common stock
issued pursuant to Regulation S        --          --          --    8,320,805
Stock issued for consultants'
  compensation                         --          --          --       63,752
Stock issued for land                  --          --          --   17,790,377
Foreign currency translation          --           --           --   (224,195)
Net  loss                                         --  (10,292,179)         --
(10,292,179)
BALANCE  AT  DECEMBER  31,  1995           --  $29,076,285 $ (113,533)
$95,178,766
Amortization of unearned
  compensation                        --           --     188,580      188,580
Stock options granted to
  executive officers                  --           --    (567,188)          --
Net proceeds from exercise
  of warrants                         --           --         --           500
Net proceeds from exercise of
  employee and non-employee
  director stock options              --           --        --        457,229
Casino One Corp. acquisition          --           --        --         14,947
Unrealized Holding Loss on
  Securities Available for Sale (850,156)          --        --      (850,156)
Foreign currency translation
  adjustment                          --           --        --       224,195
Net  loss                                         --  (31,589,347)       --
(31,589,347)
BALANCE  AT  DECEMBER  31,  1996    $(850,156) $(2,513,062)  $(492,141)
$63,624,714
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
                                     F-7



                     CASINO MAGIC CORP. AND SUBSIDIARIES

                    CONSOLIDATED STATEMENTS OF CASH FLOWS

                                              YEARS ENDED DECEMBER 31,
                                              1996            1995
1994

CASH FLOWS FROM OPERATING ACTIVITIES:
 Net  income  (loss)                               $(31,589,347) $(10,292,179)
$(3,030,451)
 Adjustments to reconcile net
   income loss to
 (loss) to net cash provided by
  operating
  activities:
 Depreciation                                        and amortization
16,263,2708,346,202    13,387,3455,768,546   10,668,77029,455
 Amortization                            2,082,932     2,381,201      39,315
 Loss on disposal of property and
  equipment                                339,9056       466,712           --
 Amortization of original issue
  discount and deferred debt
  issuance costs                         1,496,259       954,351     844,818
 Amortization of unearned stock
  compensation, net of recoveries           188,580      (436,105)   770,180
 Consultants' compensation recognized
  on  issuance  of  stock                              --(0)        63,752
103,125
 Gain  on  contract settlement                    --(0)      (855,000)
--
 Write-off of preopening costs,
  development project cost, land
  options and deposits & property
  held for development                   7,054,5325    12,104,212    4,340,543
 Loss on investment in unconsolidated
  subsidiaries                          22,436,241       112,250      407,787
 (Increase) decrease in income tax
  receivable                             3,422,873     1,899,459   (3,560,970)
 (Increase) decrease in prepaid
  expenses                                  88,861     1,634,019      558,795
 Increase in notes and accounts
  receivable, net                         (147,705)   (4,753,232)  (1,032,162)
 Decrease in deferred income taxes-
  current                               2,923,171      (720,628)    (130,182)
 Increase in other current assets         (277,793)     (129,225)     (17,881)
 Increase (decrease) in deferred income
  taxes-non current                      (4,173,197)  (1,063,610)   2,558,240
 Increase (decrease) in accounts
  payable                                 2,924,820      (389,241)     973,784
 Increase (decrease) in accrued
  expenses                              (4,278,518)   (2,026,436)   2,704,726
 Increase (decrease) in accrued
  interest                               3,487,883       208,449      (15,472)
 Increase (decrease) in accrued
  payroll and related benefits           1,255,364     2,236,447     (281,652)
 Increase (decrease) in accrued
  progressive gaming liabilities            55,376      (393,866)    (166,442)
 Increase  in  contractual  obligations                 --(0)            --
2,210,000
 Increase (decrease) in income taxes
  payable                                  573,583       959,609
 --
NET CASH PROVIDED BY OPERATING
ACTIVITIES                                     24,126,2416,011,855)
15,348,284   17,905,556
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.(CONTINUED)
                                     F-8

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

              CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

                                                 YEARS ENDED DECEMBER 31,
                                              1996            1995
1994

CASH FLOWS FROM INVESTING ACTIVITIES:
   Proceeds from sale of property and
   equipment                             1,436,821       173,389           --
   Acquisitions of property and
     equipment                         (67,850,010)  (11,396,332) (27,444,563)
     Payments for Aacquisition of gaming
     license                           (15,250,000)          --           --
   Acquisitions of property held for
     development                                         --(0)           --
(2,315,588)
   Acquisitions of property held for
     sale                                   40,437           --      (742,921)
   Investments in unconsolidated
     subsidiaries                         (651,206)  (6,117,636)  (11,997,139)
   Expenditures for organizational and
     acquisition cost                         (359)     (80,788)           --
   Expenditures for land options and
     deposits                             (480,000)  (1,326,130)   (7,162,277)
   Acquisition of foreign gaming
     concession                                           --(0)           --
(11,386,740)
   Expenditures for development and
     preopening costs                   (6,554,535)    (130,794)   (2,897,440)
   Acquisitions of deposits and other
     long-term assets                    2,530,873   (1,898,786)   (1,474,772)
  (Increase) decrease in marketable
    securities                                         --  10,244,233
8,950,988
   Issuance of short-term note                   --          --
 --
      NET CASH USED IN INVESTING
   ACTIVITIES                                    (86,777,9799,392,474)
(10,532,844)  (56,470,452)

CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from issuance of debt or notes
   payable                             121,043,749      202,011     3,000,000
  Payments of debt issuance costs       (5,419,575)      (2,000)     (198,093)
  Principal payments on notes payable   (1,010,180)  (1,185,342)     (114,658)
  Principal payments on long-term debt (48,644,469)  (2,261,096)   (1,025,811)
  Net proceeds from sale of common stock    14,947    8,320,805    10,173,000
  Net proceeds from sale or exercise of
  warrants                                      --           --     4,381,420
  Net proceeds from exercise of employee
  stock  options                               457,734      379,812
229,388
  NET CASH PROVIDED BY FINANCING
  ACTIVITIES                                  66,442,2064    5,454,190
16,445,246

NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS                                    3,790,468810,871   10,269,630
(22,119,650)

CASH AND CASH EQUIVALENTS, BEGINNING
   OF  PERIOD                                   30,755,698   20,486,068
42,605,718

CASH AND CASH EQUIVALENTS, INCLUDING
RESTRICTED CASH, END OF PERIOD         $34,546,166566,569  $30,755,698
  $20,486,068

                                     F-9

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

SUPPLEMENTAL CASH FLOW INFORMATION
                                                   YEARS ENDED DECEMBER 31,
                                                    1996       1995
1994
Interest paid, net of amount capitalized    12,379,128 15,406,868 $14,510,141
Income taxes paid, net of refunds           (7,604,043)(4,236,206)  1,741,370

SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING
  AND FINANCING ACTIVITIES:

Property and equipment and other asset
acquisitions
  financed  with  short-term  notes  payable                --  0    850,208
1,300,000
Property and equipment and other asset
  acquisitions
  included in accounts and construction
  payable and accrued expenses               5,455,469     177,091     952,506
Gaming license acquisition financed with
  long-term debt                            21,617,612          --          --
Land acquired through the issuance
  of  common stock                                   -- 0  22,140,969
--
Property and equipment under capital
  leases                                        81,114      63,632     131,221
Property and equipment and property
  held for sale financed with long-
  term debt                                 30,728,879          --   2,774,527
Land held for development financed with
  short-term  notes  and  long-term  debt                  -- 0         --
700,000
Consulting services performed for common
  stock                                                   -- 0     63,752
91,500
Common stock granted to officers                567,188    101,563   1,190,625
Commitment  for  land  option                                -- 0   (156,725)
5,000,000
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.

















                                     F-10
<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

ORGANIZATION AND BASIS OF PRESENTATION:

Casino Magic Corp. and Subsidiaries (the "Company") is an international gaming
company  with operations in Bay Saint Louis, Mississippi, Biloxi, Mississippi,
Bossier  City,  Louisiana, and the Argentina Province of Neuqu n in the cities
of  Neuqu  n  City and San Mart n de los Andes.  The Company also is  pursuing
gaming opportunities in other jurisdictions.

The  consolidated  financial statements of the Company include the accounts of
Casino  Magic  Corp.  ("Casino  Magic") and its wholly-owned subsidiaries (the
"Subsidiaries") which are Mardi Gras Casino Corp. ("Casino Magic-BSL"), Biloxi
Casino Corp. ("Casino Magic-Biloxi"), Casino Magic of Louisiana Corp. ("Casino
Magic-Bossier  City"),  Atlantic-Pacific  Corp.  ("Atlantic-Pacific"),  Casino
Magic  Neuqu  n  SA,  ("Casino  Magic-Neuqu  n"),  Casino  Magic (Europe) B.V.
("Europe"),  Casino  One  Corporation,  Casino  Magic Finance Corp., St. Louis
Casino  Corp.,  Bucks County Casino Corp., Casino Magic American Corp., Boston
Casino Corp. and Kansas Magic Corp.  Other subsidiaries are either inactive or
have  insignificant  operating or development activity as of the date of these
financial statements.

All significant intercompany accounts and transactions have been eliminated.

PRINCIPAL ACTIVITIES OF THE COMPANY:

Casino  Magic-BSL  operates  a  bi-level  dockside  casino in Bay Saint Louis,
Mississippi.    The casino began operations on September 30, 1992.  The casino
facility  includes  a 330 seat buffet, a fine dining restaurant, fast food and
entertainment  areas;  and  surface parking for approximately 2,000 cars.  The
casino is located on a site that occupies approximately 591 acres, including a
201  room  inn, marina and recreational vehicle park. Construction of the golf
course  began in October 1995 and wasas completed in February  1997.  Proposed
additions to Casino Magic-BSL include a hotel and associated amenities.

Casino  Magic-Biloxi  operates  a  three-level  dockside  casino  in  Biloxi,
Mississippi.  The casino began operations on June 5, 1993. The casino facility
includes  a  360  seat buffet, a fine dining restaurant,  fast food and lounge
and  entertainment  areas.   Parking facilities include an eight-story parking
garage containing 695 parking spaces, a shared parking garage with 204 parking
spaces  and  221  additional  surface  parking  spaces.  Construction  of  an
approximately 380 room hotel tower atop the parking garage began in 1997.

Casino  Magic-Bossier  City  operates a three-level dockside casino in Bossier
City, Louisiana.  Casino Magic-Bossier City opened on October 4, 1996, using a
temporary  facility,  and opened the permanent facility on December 31, 1996.
The  permanent  facility has been developed on a 23 acre site and includes:; a
37,000  square  foot  land based pavilion, which includes a 350 seat buffet, a
fine  dining  restaurant,  fast food and entertainment areas; a parking garage
for approximately 1,550 cars and surface parking for another approximately 400
cars.
                                     F-11

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

Atlantic-Pacific  Corp.  leaseds  and  operateds  a  limited  stakes  gaming
establishment  in  Deadwood,  South Dakota, under the name of Goldiggers.  The
establishment  consists  of  94  slot  and  video lottery machines, four table
games,  restaurant and bar, and a nine-room hotel.  Operations commenced April
11, 1991.  Casino Magic sold Atlantic-Pacific Corp. in June 1996.

Casino Magic-Neuqu n operates two casinos in the Argentina Province of Neuqu n
in the cities of Neuqu n City and San Mart n de los Andes. The casinos include
approximately 29,000 square feet of gaming space including 54 table games, 395
slot machines and a bingo facility. The casinos began operations on January 1,
1995.

Europe  owneds a 49% interest in Porto Carras Casino S.A., ("Porto Carras"), a
Greek  company  which  operates  an American-style casino in northern Greece.
Equity  in the income of Porto Carras is accounted for using the equity method
of accounting and is included in loss from unconsolidated subsidiaries. Casino
Magic sold its interest in Porto Carras in December 1996.

Casino One Corporation holds title to land in Biloxi, Mississippi, adjacent to
the  property  on  which  the  Company  conducts  gaming operations in Biloxi,
Mississippi.

Casino  Magic  Finance  Corp.  is  a special purpose finance subsidiary formed
specifically  to  issue  $135,000,000 First Mortgage Notes ("Mississippi First
Mortgage  Notes").    Casino Magic Finance Corp. is 50% owned by each of Mardi
Gras Casino Corp. and Biloxi Casino Corp.

St.  Louis Casino Corp. holds title to real estate in St. Louis, Missouri.  It
is the Company's intention to sell  this property .

Bucks  County  Casino  Corp.  holds  title  to  real estate and has options to
purchase  additional  real  estate  in  Bucks County, Pennsylvania.  It is the
Company's intention to use this property in connection with the development of
a proposed casino, if, and when, legislation is passed allowing such activity.

Casino  Magic  American  Corp.  is  a  wholly-owned  subsidiary of the Company
through  which  the  Company manages or provides consulting services to Native
American gaming operations.

Boston  Casino  Corp. has an  option on real estate.  During 1995, the Company
abandoned  all  efforts  to  pursue  gaming  at  this  site  and  all  amounts
capitalized relating to this option were expensed.

Kansas  Magic  Corp. is a wholly-owned subsidiary of the Company through which
the Company is a 50% member of each of two limited liability companies, Kansas
Gaming Partners, L.L.C. ("KGP") and Kansas Financial Partners, L.L.C. ("KFP").
 During 1995, the Company expensed its recorded investment due to a bankruptcy
proceeding as discussed in Note 910.

                                     F-12

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

      CASINO REVENUES AND COMPLIMENTARIES:

In  accordance  with  common industry practice, casino revenues are the net of
gaming  wins  less losses.  Revenues exclude the retail value of complimentary
rooms,  food  and  beverage furnished gratuitously to customers. The estimated
departmental  costs  of  providing rooms is not significant, and the estimated
departmental  costs  of  providing  food and beverage services are included in
casino expense as follows:
                           YEARS ENDED DECEMBER 31,
                        1996         1995         1994
                    $13,838,000  $12,072,000  $14,750,000

       CASH AND CASH EQUIVALENTS:
For  purposes of the consolidated balance sheets and statements of cash flows,
the Company considers all highly liquid investments purchased with an original
maturity of three months or less to be cash equivalents.

       RESTRICTED CASH:
At  the  closing  of  the  Louisiana  First  Mortgage  Notes  (See  Note  6),
approximately  $45.2  million  of  the  net proceeds thereof were deposited in
collateral  accounts  (the "Cash Collateral Accounts") to be disbursed only in
accordance with the Cash Collateral and Disbursement Agreement executed at the
closing  of  the  Louisiana  First Mortgage Notes Offering.  The balances that
remain  in  these  collateral  accounts  at  December  31,  1996, are shown as
restricted cash.
       MARKETABLE SECURITIES:
Marketable  securities were short-term investments in government securities or
low-risk  financial  instruments  recorded  at  cost which approximates market
value.


       PROPERTY AND EQUIPMENT:
Property  and  equipment  are  stated  at  cost.    Depreciation,  including
amortization  of  capital leases and leasehold improvements, is computed using
the  straight-line  method.  Estimated useful lives for property and equipment
are  15  - 31  years for barges and buildings, life of the lease for leasehold
improvements and 5-7 years for furniture and equipment.

Normal  repairs  and  maintenance  are  charged  to  expense  when  incurred.
Expenditures  which  materially  extend  the useful life of capital assets are
capitalized.

       INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES:
Investments  in  unconsolidated  subsidiaries  where  the  Company  exercises
significant influence are accounted for under the equity method.








                                     F-13

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

      AMORTIZATION OF INTANGIBLES:
Deferred  charges relating to debt issuance costs and original issue discounts
on  long-term debt instruments are amortized over the life of the related debt
using the effective interest rate method to provide a constant yield.

Deferred  charges relating to debt issuance costs and original issue discounts
on long-term debt instruments are  amortized over the life of the related debt
using the effective interest rate method to provide a constant yield.

Included  under  other  long  term  assets  is "Deferred gaming license cost."
Deferred  gaming  license  cost  represents  the  estimated  fair value of the
Louisiana  gaming  license, an asset acquired in conjunction with the purchase
of  Crescent  City Development Corporation ("Crescent City") see Note 4.  This
cost  is  being amortized on a straight-line basis over twenty-five years, the
estimated  period  to  be benefited by the license which commenced at the time
gaming operations began at Bossier City.


      FOREIGN CASINO CONCESSION AGREEMENT:
The  costs  capitalized to acquire the foreign casino concession agreement are
being  amortized  on  a  straight-line  basis over the twelve year life of the
agreement.

      DEVELOPMENT AND PREOPENING COSTS:
All  internal salary and related costs of the Company's development activities
are  expensed  as  incurred.  Amounts  paid  for  outside  consultants  and
professional  fees  are  expensed  until  gaming  has  been  legalized  in the
jurisdiction,  the  Company  has  an  approved  site and there is a reasonable
likelihood that the Company will be granted a gaming license.  From this point
forward,  outside  and  incremental  development  costs  are  capitalized.
Capitalized  development costs of $2,055,509 were included in development and
expenses  as  of  December 31, 1994.  As discussed in Note 9, during 1995, the
Company modified its agreements with the Sisseton-Wahpeton Dakota Nation. As a
result  of this, the amounts previously capitalized were expensed.  Preopening
costs  are  capitalized  then  expensed  when  the  related business commences
operations.

       OPTIONS AND LAND DEPOSITS:
The  costs  of  options  and  land deposits are amortized over the life of the
option  or  deposit  until  such time as the option or deposit is exercised or
abandoned.

       INCOME TAXES:
Income  taxes  are accounted for in accordance with provisions of Statement of
Financial  Accounting Standards No. 109, "Accounting for Income Taxes."  Under
the  asset  and liability method of Statement No. 109, deferred tax assets and
liabilities  are  recognized  for  future  tax  consequences  attributable  to
differences  between  the  financial  statement  carrying  amounts of existing
assets  and  liabilities  and their respective tax bases.  Deferred tax assets
and  liabilities  are  measured  using  enacted tax rates expected to apply to
taxable  income in the years in which those temporary differences are expected
to  be  recovered or settled.  Under Statement No. 109, the effect on deferred
tax assets and liabilities of a change in tax rates is recognized in income in
the period that includes the enactment date.
                                     F-14

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

       FOREIGN CURRENCY TRANSLATION:
The  functional  currency  for certain foreign subsidiaries and unconsolidated
companies is the applicable local currency.  The translation of the applicable
local  currencies  into  U.S.  dollars is performed for balance sheet accounts
using  the  current exchange rates in effect at the balance sheet date and for
revenue  and expense accounts using weighted average exchange rates during the
period.    The  gains  and  losses  resulting  from  the balance sheet account
translations,  net  of  deferred  income  taxes, are included in shareholders'
equity.    Some  transactions  of the Company and its subsidiaries are made in
currencies different from their own.  Gains and losses from these transactions
are included in the consolidated statements of operations as they occur.
Foreign  currency  transaction  gains  or  losses included in the consolidated
statement of operations have not been material.

       NET INCOME (LOSS) PER COMMON SHARE:
Net  income  (loss) per common and common equivalent share is calculated using
the  weighted  average  number  of  common shares outstanding increased by the
additional  number  of  shares  which  would  be issuable upon the exercise of
warrants and stock options, including options granted under the Company's 1992
Incentive  Stock  Option  Plan.  In the calculation, as required under Opinion
No.  15  of  the Accounting Principles Board ("APB 15"), an assumption is made
that  the  Company used the exercise proceeds to purchase additional shares at
the  average  market price and applied any excess proceeds under the "modified
treasury  stock  method."    As  further  required  by  APB  15, proceeds were
calculated to include the exercise proceeds of the issuances, average unearned
compensation  for  future  services,  and  the tax benefit associated with the
increase in market price of certain stock options granted outside the Plan.

CERTAIN SIGNIFICANT RISKS AND UNCERTAINTIES:

GAMING REGULATION LICENSING.   The Company has gaming operations in the United
States  and abroad that depend on the continued licensability or qualification
of  the  Company  and  subsidiaries  that  hold  gaming  licenses  in  various
jurisdictions.  Such licensing and qualifications are reviewed periodically by
the gaming authorities in those jurisdictions.

COMPETITION.    The  gaming  industry is extremely competitive and the Company
faces  competition  from  new  developments  in  both  the  United  States,
specifically on the Mississippi Gulf Coast and in Louisiana, and abroad.

FOREIGN  OPERATIONS.    The  Company  has  investments  and  net  assets  of
approximately  $16  million  in gaming operations outside of the United States
which  are  subject  to  risks  associated  with  the distance of these casino
facilities from the Company's executive offices, the stability of the relevant
government,  regulations imposed by foreign governments, the continued ability
to repatriate cash, and currency exchange issues.




                                     F-15

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
CAPITALIZED  COSTS.    At  December  31,  1996, the accompanying balance sheet
reflects  assets  related  to  options and land deposits and property held for
development  in  states where the Company does not presently have a license to
conduct  gaming  or gaming is not presently allowed by law.  If the Company is
not  successful  in  acquiring  licenses  or  gaming  is not legalized in such
states,  future  adjustments  to  the  carrying  value  of these assets may be
required.

SEVERE  WEATHER.    The  Mississippi  Gulf Coast is subject to severe weather,
including hurricanes.  Severe weather could cause damage to one or both of the
Company's  Mississippi  casino  facilities.    The Company maintains insurance
against  casualty  losses  resulting  from severe weather and against business
interruption.  Such  insurance  may  not adequately compensate the Company for
loss of profits resulting from severe weather.

START-UP  OF  OPERATIONS.  Initial operations of the Casino Magic-Bossier City
casino  were  adversely affected by high water which forced the closure of the
casino  for  15  days  during  1996,  as well as beginning operations before a
substantial  portion  of  the  Casino's  amenities  were  completed.    It  is
anticipated  that  these  difficulties incurred during start-up operation will
negatively impact operations during the early part of 1997.

PERVASIVENESS  OF  ESTIMATES.    The  preparation  of  financial statements in
conformity  with  generally accepted accounting principles 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.

RECLASSIFICATIONS:
Certain  reclassifications  have  been  made  to  the 1995 and 1994 amounts to
conform with the December 31, 1996 presentation.

















                                     F-16

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

2. NOTES AND ACCOUNTS RECEIVABLENOTES AND ACCOUNTS RECEIVABLE:

   Notes and accounts receivable consist of the following:

                                                   DECEMBER 31,
                                              1996              1995
Current:
Notes receivable - from affiliate        $       --         $2,000,000
Notes receivable                            790,228                 --
Accounts receivable - air charter           548,239            570,540
Accounts receivable - trade               2,505,463          1,653,912
Accounts receivable - from affiliate             -- 0          3,211,588
Other                                       606,631            846,909
                                         $4,450,561         $8,282,949
Less allowance for doubtful accounts      1,561,075          1,403,869
Total Notes and Accounts Receivable
(current)                                $2,889,486         $6,879,080
Noncurrent:
Notes receivable                          4,119,700-- 0
Total Notes and Accounts Receivable      $7,009,186         $6,879,080

Included  in  notes  receivable  is  a  commercial  loan in which the Company,
through  a  wholly-owned  subsidiary,  participated.   The amount of Company's
participation  is $5 million.  The entire loan amount in which the Company, is
participating is $17,500,000.  The loan was made by a consortium of lenders to
the  Sisseton-Wahpeton  Dakota  Nation,  a  Native  American  Tribe,  for  the
construction  of  a  casino  facility  on  Tribal land. The Company, through a
wholly-owned  subsidiary,  has a consulting agreement with the Native American
Tribe  to  assist  in  the  operations  of  the casino facility.  The loan was
converted  from a construction loan to a term loan in February 1997.  The term
loan is repayable over a sixty month period payable in monthly installments of
$105,230  including  principal and interest at a fixed rate of 10.375% through
February 2002.

3.  PROPERTY AND EQUIPMENTPROPERTY AND EQUIPMENT:
     Property and equipment consists of the following:
                                                    DECEMBER 31,
                                              1996               1995

Land and improvements                     $ 67,658,624      $ 58,018,386
Buildings and improvements                  44,554,665        41,672,748
Barges and improvements                     55,203,063        35,973,068
Leasehold improvements                         382,907         1,362,141
Furniture and equipment                     69,663,192        54,916,169
Construction in progress                    48,549,525         8,424,425
                                           286,011,976       200,366,937
Less accumulated depreciation
   and amortization                        (42,319,405)      (30,575,180)
                                          $243,692,571      $169,791,757


                                    F-17

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

4. STOCK ACQUISITIONS:

In  May  1996,  Casino  Magic,  through its wholly-owned subsidiary, Jefferson
Casino  Corporation  ("Jefferson  Corp")  acquired  Crescent  City  Capital
Development  Corp.("Crescent  City") for $50 million plus the assumption of up
to  $5.7 million in equipment liabilities.  Jefferson Corp paid $15 million in
cash  at  closing  and  caused  Crescent  City  to  issue $35 million of 11.5%
secured,  three year notes . Crescent City, which was the subject of a plan of
reorganization  under  Chapter  11  of  the  U.S.  Bankruptcy  Code, owned the
Crescent  City Queen riverboat ("Crescent City Riverboat"), gaming and related
equipment and surveillance equipment and a license to conduct riverboat gaming
operations  in  Louisiana.    Crescent  City  emerged  from  the  Bankruptcy
proceedings  as Casino Magic of Louisiana Corp. ("Casino Magic-Bossier City").
The  Company  is  using  Casino Magic-Bossier City's gaming license in Bossier
City, Louisiana, where it currently owns 23 acres of land.  Although Jefferson
Corp.  was  required  to  purchase  the  Crescent City Riverboat to obtain the
Louisiana  gaming  license,  the Crescent City Riverboat is one of the largest
riverboats  in the United States and could not be used at Casino Magic-Bossier
City  because  of  Crescent  City  Riverboat's  width.  Therefore, the Company
purchased  a  casino  riverboat  (the  "Bossier  Riverboat") for use at Casino
Magic-Bossier  City  for $20 million.  The Crescent City Riverboat, classified
as  property held for sale, with a carrying value of $10.1 million at December
31,1996,  will  be sold and the proceeds will be used to assist in the funding
of the hotel at Bossier City.  The Company can give no assurances that it will
be  able to dispose of the Crescent City Riverboat on acceptable terms or in a
timely  manner.    The  assets acquired as a part of the acquisition of Casino
Magic-Bossier  City  which included gaming, surveillance and related equipment
are being used at Casino Magic-Bossier City's gaming site.

5. DISPOSITIONS
On  June  13,  1996,  the  Company  sold the capital stock of Atlantic-Pacific
Corp.,  which  operates  "Goldiggers," a small casino-hotel in Deadwood, South
Dakota,  to  Royal  Casino  Group,  Inc.  ("RCG"), an unaffiliated party whose
common stock trades on the NASDAQ market (ticker symbol WINZ).  Goldiggers had
not  been  regarded  by  the Company as material to its operations for several
years.    In  consideration  for  the sale of such stock, the Company received
shares  of  RCG  Series  A Convertible Preferred Stock and warrants to acquire
shares of RCG common stock.  The Indenture (See Note 7) required that at least
85% of the consideration received by the Company in respect of such asset sale
be  in  the form of cash.  By selling such securities for cash to a subsidiary
that  is not subject to the investment covenants of such Indenture, management
has taken steps which it believes are sufficient to cure such violation.










                                     F-18

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

5. DISPOSITIONS (CONTINUED)
At September 30, 1996, management determined that its 49% equity investment in
Porto Carras Casino S.A., and notes and accounts receivable relating to unpaid
management  fees  and  royalties  were  impaired.  Because of this impairment,
management wrote off its investment in such gaming facilities in Porto Carras,
Greece, ("Porto Carras") and all unpaid notes and receivables related thereto.
 The total charge recorded relating to the write off of Porto Carras was $26.1
million.    Management's  decision  was  based, primarily, on the results from
Porto  Carras  after  the  opening  of a competing casino.  In September 1996,
Hyatt  Corporation  opened  a  new  casino  in the City of Thessaloniki, Porto
Carras's  primary market and was required by the Greek Government to charge an
$8  admission  tax  compared to Porto Carras' $20 admission tax.  Although the
Company  anticipated  some  revenue  loss  as  a  result  of  this  increased
competition  and  admission  fee  differential,  the  actual effects were much
greater  than  anticipated and resulted in a $2.0 million loss from operations
at  Porto  Carras  for the month of September 1996.  Despite new marketing and
cost  containment  efforts, these losses  continued; furthermore, the majority
owner  in Porto Carras venture was unwilling or unable to advance any funds to
the  operation.  Additionally, the majority owner informed the Company that it
did  not  intend  to  operate a substantial portion of the Porto Carras resort
area,  consisting  of two hotels and amenities, during the 1997 season.  These
factors,  among  others,  led  to  the  Company's  decision  to  write off its
investment  in  Porto  Carras  and led to the sale of Porto Carras in December
1996.

6.  NOTES AND CONTRACTS PAYABLENOTES AND CONTRACTS PAYABLE:

Short-term notes and contracts payable consist of the following:

                                                        December 31,
                                                   1996              1995

Construction contracts (a)                      $ 4,540,434       $ 113,966
Other  (b)(c)                                               168,169
850,208
                                                $  4,708,603              $
964,174

(a)  Consists  of  various  payables  relating  to  both  fixed  and cost plus
contracts.
(b)  In  1996,  the  balance  consisted of three notes payable.  The detail of
these  notes  is  as  follows:    (i) $161,939 uncollaterized note, payable in
monthly installments of $27,585 including interest at 7.5%, through June 1997.
 (ii)  $1,837  note  collateralized  by  office  equipment, payable in monthly
installments  of  $157.    (iii) $4,393 note collateralized by golf equipment,
payable in monthly installments of $290.
(c)  In  1995,  the  balance  consisted  of an uncollaterized note, payable in
variable  monthly  installments  including  interest  at prime plus 5% through
September 1996.





                                     F-19

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

7.     LONG-TERM DEBTLONG-TERM DEBT:

Long-term  debt,  including  capital  lease  obligations,  consists  of  the
following:

                                                DECEMBER 31,
                                          1996                1995

Notes payable, bank (a)             $  9,585,130        $  2,765,423
Equipment contracts (b)                  622,274                  --
Notes payable, land (c)                3,470,415           4,102,507
Capital lease obligations (Note 9)       308,514             259,557
Other (d)                              1,207,986             928,500
Louisiana First Mortgage Notes (e)   115,000,000                  --
First Mortgage Notes (f)             135,000,000         135,000,000
   Unamortized original
   issue discount                     (2,284,450)         (2,620,232)
                                    $262,909,869        $140,435,755
Less current maturities             $ (4,648,638)       $ (3,595,745)
                                    $258,261,231        $136,840,010

(a)  Consists of four notes payable to banks.  The detail of these notes is as
follows:  (i)$3,000,000  uncollateralized  promissory note, payable in monthly
installments  of  interest  only  through July 1996; thereafter, principal and
interest  based  on  a  60  month  amortization  through  February  2000.  The
promissory  note  bears interest at prime plus 1% (9.25% at December 31, 1996)
throughout  the  life of the note with a final balloon payment due in February
2000.    (ii)  $1,700,000  note collateralized by gaming equipment.  The first
payment  is  due  120  days  following  the  opening  of Bossier City's gaming
facility.    The note is payable in thirty-six monthly payments of $53,463.49,
including  interest  at  prime  plus  1/4% (8.5% at December 31, 1996).  (iii)
$1,343,749  assumed  note  collateralized  by the company jet.   This note was
paid  off  subsequent to year end when the jet sold. The note is payable in 34
remaining  monthly  payments  of  $35,000, including interest at prime plus 1%
(9.25%  at  December  31,  1996)  throughout the life of the note with a final
balloon  payment  due  October 1999.  (iv) $4,575,740 collateralized by gaming
equipment.  The first payment is due 120 days following the opening of Bossier
City's gaming facility.  The note is payable in thirty-six monthly payments of
$135,788.17, including interest at prime plus 1% (9.25% at December 31, 1996).

(b)    Consists  of  two  notes payable collateralized by golf equipment.  The
detail  of these notes is as follows: (i) $482,365 note payable in forty-three
remaining  monthly  payments of $12,150.80, including interest at 9.64%.  (ii)
$182,049  note  collaterized by golf equipment, payable in forty-one remaining
monthly payments of $4,540.68, including interest at 9.12%.






                                     F-20

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

7.     LONG-TERM DEBT (CONTINUED)LONG-TERM DEBT:
(c)  Consists of three notes payable for land acquisitions.  The detail of the
three  notes  is as follows:  (i)$471,614 note payable in monthly installments
of  $14,920.34  including  interest  at  prime plus 2% (10.25% at December 31,
1996),  through April 1999.  (ii)$870,942 note payable in monthly installments
of  $12,134  including interest at 8% through July 2003.  (iii)$3,000,000 note
payable  in  monthly    installments  of  $111,699 including interest at 8.75%
through November 1998.

(d)   Consists of various collateralized notes payable through the year 2004.
The interest rates on these notes vary from 7.9% to 10% fixed rates.

(e)    On  August  22,  1996, a wholly owned subsidiary of the Company, Casino
Magic-Bossier City, sold $115,000,000 aggregate principal amount of 13%, First
Mortgage  Notes  securities  due  in  2003  ("Series A Notes") with contingent
interest.  Casino Magic-Bossier City is required to offer to exchange up to an
aggregate  of  $115,000,000  principal  amount  of 13% Series B First Mortgage
Notes  due  2003  with Contingent Interest (the "Series B Notes" and, together
with the Series A Notes, the "Louisiana First Mortgage Notes") for such Series
A  Notes.  The Series B Notes will be identical to the Series A Notes but will
be registered with the Securities and Exchange Commission.
Contingent  Interest is payable on the Louisiana First Mortgage Notes, on each
interest  payment  date,  in  an  aggregate  amount  equal  to  5%  of  Casino
Magic-Bossier  City's  Adjusted  Consolidated  Cash  Flow  (as  defined in the
Louisiana  First  Mortgage  Notes  Indenture  ("Louisiana  Indenture") for the
Accrual  Period  (as  defined  in the Louisiana Indenture, but generally a six
month  period)  last  completed  prior to such interest payment date; provided
that no Contingent Interest is payable with respect to any period prior to the
Commencement  Date (as defined in the Louisiana Indenture).  Payment of all or
a  portion  of  any installment of Contingent Interest may be deferred, at the
option  of Casino Magic-Bossier City, if, and only to the extent that, (i) the
payment of such portion of Contingent Interest will cause Casino Magic-Bossier
City's  Adjusted  Fixed  Charge  Coverage  Ratio  (as defined in the Louisiana
Indenture)  for  Casino Magic-Bossier City's most recently completed Reference
Period prior to such interest payment date to be less than 1.5 to 1.0 on a pro
forma  basis  after  giving  effect  to the assumed payment of such Contingent
Interest  and  (ii) the principal amount of the Louisiana First Mortgage Notes
corresponding  to such Contingent Interest has not then matured and become due
and  payable  (at  stated  maturity,  upon acceleration, upon redemption, upon
maturity  of  a  repurchase obligation or otherwise).  The aggregate amount of
Contingent  Interest payable in any Semiannual Period will be reduced pro rata
for reductions in the outstanding principal amount of notes prior to the close
of  business  on  the  record  date  immediately  preceding  such  payment  of
Contingent Interest.

The Series A Notes were issued to consolidate the funding necessary to develop
Casino  Magic-Bossier  City  project.    This  included  the  repayment of the
Louisiana Land Note and the Louisiana Notes.




                                     F-21

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

7.     LONG-TERM DEBT (CONTINUED)LONG-TERM DEBT:
The  Louisiana  First  Mortgage Notes are secured by a first priority security
interest, subject to permitted liens, in substantially all of the existing and
future  assets  of  Bossier  City,  including  the  Bossier  Riverboat  and
substantially  all  of  the  other  assets that comprise  Casino Magic-Bossier
City,  the  Crescent  City  Riverboat,  and  an assignment of the construction
contracts  pursuant to which Casino Magic-Bossier City was being constructed.
The  Jefferson  Guarantee  will  be  secured by a pledge of all of the capital
stock of Jefferson Casino Corp., a wholly owned subsidiary of the Company.
Casino  Magic-Bossier  City  has contractually committed to apply net proceeds
from  an  asset  sale  of  the  Crescent City Riverboat to the construction of
Casino  Magic-Bossier  City  which  improvements  shall  be  owned  by  Casino
Magic-Bossier  City  or  such  Subsidiary  and  be used by or useful to Casino
Magic-Bossier City or such Subsidiary in any line of business in which Bossier
City  or  such  Subsidiary is permitted to be engaged pursuant to the covenant
described  under  "Certain  Covenants  Line  of  Business  as  defined  in the
Indenture;" provided, however, that the Net Proceeds from an asset sale of the
Crescent  City  Riverboat  may  be  applied  only  to  the making of a capital
expenditure or the acquisition of long-term assets or the payment of the costs
of  construction  of  real  property  improvements, in any case, to be used by
Casino  Magic-Bossier  City  ator  the  Casino  Magic-Bossier  as  a  casino
entertainment facility or  hotel.
The  Louisiana  First  Mortgage Notes are governed by the Louisiana Indenture.
The  Louisiana  Indenture pursuant to which the Louisiana First Mortgage Notes
have  been  issued  contains  certain covenants that will limit the ability of
Casino  Magic-Bossier  City and its subsidiaries to, among other things, incur
additional  indebtedness  and  issue  preferred  stock,  pay  dividends,  make
investments or make other restricted payments, incur liens, enter into mergers
or consolidations, enter into transactions with affiliates or sell assets.
(f)  On  October  14, 1993, a wholly owned indirect subsidiary of the Company,
Casino  Magic  Finance Corp. ("Finance Corp."), sold $135,000,000 in aggregate
principal  amount  of  11 1/2% First Mortgage Notes due in 2001 (the " Finance
Notes")  and  warrants to purchase 810,000 shares of Casino Magic Corp. common
stock.   Proceeds from the Notes were allocated by the underwriter between the
Finance  Corp. and the Company based on the estimated fair market value at the
time  of  issuance  of  the  Finance  Notes and the warrants in the amounts of
$131,760,000  and $3,240,000 ($4 per warrant), respectively.  The value of the
warrants  is  treated  as  original  issue  discount  for  financial statement
purposes,  and  is  reflected  in  the balance sheet net of amortization as an
adjustment  to  the  carrying  value of long-term debt.  The Finance Notes are
governed  by  an  Indenture  (the  "Indenture")  entered into on the same date
between  Finance  Corp.,  the Company and IBJ Schroder Bank & Trust Company as
the  Trustee.    Under Section 4.10 of the Indenture, the Company's ability to
pay  dividends  on  its  common  stock  is  restricted  to  an amount which is
determined under a formula based primarily on the Company's future income, and
is precluded upon the occurrence of an "Event of Default" as defined under the
Indenture.   Events of Default include, among other things, the failure to pay
the interest or principal due on the Finance Notes, the entry of a judgment in




                                     F-22

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

7.     LONG-TERM DEBT (CONTINUED)LONG-TERM DEBT:

excess  of $10,000,000 against the Company or its material subsidiaries, which
is  not  discharged within 60 days after entry, and the default by the Company
or  its  material  subsidiaries  under indebtedness due to third parties.  The
Indenture  also  contains certain covenants that restrict, among other things,
the  making  of  certain  investments,  payments  of  dividends  and  other
distributions, the incurrence of additional indebtedness and future guarantees
of  indebtedness,  certain  transactions  with  shareholders  and  affiliates,
certain  mergers  and  consolidations, certain asset sales and the creation of
certain  liens.   Additionally, in Mississippi, where certain of the Company's
subsidiaries are incorporated, laws exist which prohibit payments of dividends
if  such  payments would create negative equity on a fair market value basis.
The  Finance  Notes are secured by a pledge of the stock of Finance Corp., Bay
Saint  Louis  and  Biloxi  along  with  the  accounts receivable, inventories,
property  and  equipment, property held for development and deposits of Casino
Magic-BSL  and Casino Magic-Biloxi.  The book basis of these pledged assets is
approximately  $150,000,000 at December 31, 1996.  The effective interest rate
of  the  Notes  is  13.06%.   The proceeds from the Notes were used to pay off
substantially all outstanding obligations at October 14, 1993.

Maturities  of  the  Company's  long-term  debt,  including  capital  lease
obligations, as of December 31, 1996, are as follows:

     YEAR ENDING DECEMBER 31,
     1997                             $  4,648,638
     1998                                4,985,055
     1999                                3,891,168
     2000                                  937,205
     2001                              135,245,043
     Thereafter                         115,487,210
                                       265,194,319
     Unamortized original issue
     discount                           (2,284,450)
                                     $262,909,869

8.     LEASE COMMITMENTS:

   The  Company has long-term lease agreements for land for the site of Casino
Magic-Biloxi and additional land at Casino Magic-BSL.  The Casino Magic-Biloxi
land  is classified as an operating lease.  The annual rental payments for the
initial  five-year  term  of  the Casino Magic-Biloxi land lease began June 5,
1993,  and  are  $550,000,  $250,000,  $450,000, $450,000 and $200,000 for the
first  through  fifth  year.    The  land  lease contains seventeen, five-year
renewal  options  at  contractually higher rentals, plus inflation adjustments
not to exceed 4.5% per year.





                                     F-23

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

8.     LEASE COMMITMENTS (CONTINUED):
On June 4, 1993, the Company entered into a long-term agreement with the State
of  Mississippi  to  lease 283,217 square feet of submerged lands or tidelands
for  Casino Magic-Biloxi.  The initial lease term expires May 31, 2003, but is
cancelable  by  the  Company  in  May 1998.  Annual rental payments are due in
advance  on  the  first  of  June  in  the  amount of $595,000, plus an annual
increase of $45,000 for the first five years.

   The  following  is  a schedule of future minimum lease payments for capital
and  operating  leases (with initial or remaining terms in excess of one year)
as of December 31, 1996:

Year ending December 31,
                                                Capital        Operating
                                                 Leases         Leases

      1997                                         $351,565       $1,866,404$
462,032
      1998                                                      211,342
1,323,4472,664,093
      1999                                                      155,279
1,112,7092,341,394
      2000                                                       27,185
1,063,3061,139,168
      2001                                                     21,488
952,0001,141,025
      Thereafter                                 45,5722,070,5001,039,000
Total  minimum  lease  payments                                  812,431
$8,388,366786,712
Less amount representing interest (8% to 13%)   131,974
Present value of net minimum capital lease
payments                                       $680,457

      Rent  expense  for  all non-cancelable operating leases was $1,800,000,
$3,048,000,  and  $3,254,000  for  the years ended December 31, 1996, 1995 and
1994, respectively.

9.  OTHER COMMITMENTS AND CONTINGENCIES

ONGOING LEGAL PROCEEDINGS:

A  class  action  lawsuit  was  filed  on April 26, 1994, in the United States
District  Court,  Middle District of Florida (the "Poulos Lawsuit"), naming as
defendants  41 manufacturers, distributors and casino operators of video poker
and electronic slot machines, including the Company.  The lawsuit alleges that
such  defendants have engaged in a course of fraudulent and misleading conduct
intended  to  induce  people  to  play  such  games  based  on  a false belief
concerning  the  operation  of  the  gaming machines, as well as the extent to
which  there  is  an  opportunity  to win.  The suit alleges violations of the
Racketeer Influenced and Corrupt Organization Act, as well as claims of common
law  fraud,  unjust  enrichment  and  negligent  misrepresentation,  and seeks
damages  in  excess  of  $6  billion.   On May 10, 1994, a second class action
lawsuit  was  filed  in  the  United States District Court, Middle District of
Florida  (the  "Ahern  Lawsuit"), naming as defendants the same defendants who
were  named  in  the  Poulos  Lawsuit  and  adding as defendants the owners of
certain  casino  operations in Puerto Rico and the Bahamas, who were not named
as defendants in the Poulos Lawsuit.  The claims in the Ahern Lawsuit are



                                     F-24

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

9.  OTHER COMMITMENTS AND CONTINGENCIES (CONTINUED):
identical  to  the claims in the Poulos Lawsuit.  Because of the similarity of
parties  and  claims,  the  Poulos  Lawsuit  and  Ahern  Lawsuit have now been
consolidated  into  one  case file in the United States District Court, Middle
District  of  Florida.    On December 9, 1994 defendants' motion for change of
venue  was granted, transferring the case to the U.S. District Court, District
of  Nevada,  in  Las  Vegas.  In response to a motion to dismiss the Complaint
brought  by the Company and other defendants, the United States District Court
for the District of Nevada entered an Order dated April 17, 1996, granting the
motions  and  dismissing the complaint without prejudice.  The plaintiffs then
filed  an  amended  Complaint  on May 31, 1996, in which the plaintiffs sought
damages  against  the Company and other defendants in excess of $1 billion and
punitive  damages  for  violations  of  the  Racketeer  Influenced and Corrupt
Organizations Act and for state common law claims for fraud, unjust enrichment
and  negligent misrepresentation.  The Company and other defendants have moved
to  dismiss  the  amended Complaint.  The Company believes that the claims are
without  merit  and  does  not  expect  that  the lawsuit will have a material
adverse  effect  on  the  financial  condition or results of operations of the
Company.

On  October 20, 1994, International Gaming Network, Inc., commenced litigation
in  Federal  Court  against  Casino Magic Corp. by filing a Complaint with the
U.S.  District Court, District of South Dakota, Southern Division.  Plaintiff,
in  that  litigation,  has  alleged,  among  other  things,  that  the Company
intentionally  and  improperly  interfered  with  Plaintiff's  existing  and
perspective  contractual,  economic  or  business  relationship  with  the
Sisseton-Wahpeton  Sioux  Tribe,  and  seeks damages of $28,292,102.  In April
1994,  the  Company  entered  into  an agreement with the Tribe to develop and
manage  a  gaming  casino  on tribal lands in northeastern South Dakota.  (The
Company  has  since  canceled  the  management  agreement  and  entered into a
consulting  agreement  with  the  Tribe.)    On  November 9, 1994, the Company
interposed  an  answer  denying  the  allegations  contained  in  Plaintiff's
estimated  range  or  potential  loss,  if  any, which may be sustained by the
Company  in  connection  with  this  litigation,  but  believes the lawsuit is
meritless  and  intends  to  vigorously  defend  the claim.  The United States
District  Court, on October 7, 1996, filed a Judgment of Dismissal, dismissing
all of Plaintiff's claims, pursuant to a Motion for Summary Judgment which had
been  brought  by Casino Magic.  Pursuant to a Notice of Appeal dated November
5,  1996, the Plaintiff has appealed the dismissal of its claims to the United
States  Court  of Appeals for the Eighth Circuit.  Company management believes
that  the  outcome  of the litigation discussed above will not have a material
adverse effect on the Company's financial position or results of operations.

In  addition, the Company is a litigant in legal matters arising in the normal
course  of  business.    In  the opinion of management, all such pending legal
matters  are  either  adequately covered by insurance, or if not insured, will
not  have  a  material  adverse effect on the financial position or results of
operations of the Company.



                                     F-25

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

9.  OTHER COMMITMENTS AND CONTINGENCIES (CONTINUED):
CONTRACTUAL AGREEMENTS:

ARGENTINA.      In  December  1994,  the  Company,  through  its  wholly-owned
subsidiary,  Casino Magic-Neuqu n, entered into a 12-year concession agreement
with  the  Province  of  Neuqu  n, Argentina. Casino Magic-Neuqu n which began
operations  in January 1995 operates two casinos in the Province of Neuqu n in
the  cities  of  Neuqu  n  City  and  San Mart n de los Andes. The Company has
unrestricted  rights  to  increase  the  number  of  gaming  positions at both
locations.

CAMPTOWN  GREYHOUND  RACING,  INC.   On July 7, 1994, the Company and Alliance
Gaming  Corp.  (formerly  United  Gaming) formed two joint ventures ("KGP" and
"KFP") to loan Camptown Greyhound Racing, Inc. ("Camptown') approximately $3.2
million.    On  October 28, 1994, KFP executed a loan agreement with Boatmen's
Bank  of  Kansas  City  ("Boatmen's") whereby Boatmen's loaned $3.2 million to
Camptown.   KFP had collateralized the loan with a $3.1 million certificate of
deposit (one-half funded by each party to the joint venture) and, in addition,
guaranteed  the  repayment  of  the loan.  In January 1996, Camptown filed for
protection  under  Chapter  11 of U.S. Bankruptcy Code.  KFP has satisfied its
obligation  under  the guarantee, and now owns a second mortgage on Camptown's
facility  in  Frontense,  Kansas  in  the  amount  of $3,205,000, plus accrued
interest.  The Company has taken steps to protect its investment and rights to
operate gaming devices at the Camptown facility, if and when such operation is
legalized.    The  Company's  $1,580,000  share of the amount loaned by KFP to
Camptown was expensed in 1995.

In January 1997, the Company transferred all of its interest in KGP and KFP to
Alliance  Gaming  Corp.,  an  unrelated  third  party,  except  for  a
deminimusdiminimums interest.  The consideration for the transfer was Alliance
Gaming  Corp.'s  agreement to assume certain current financial obligations and
to  repay the Company all of its cost in the project if they are successful in
commencing gaming operations at Camptown.

LAKES  REGIONAL  GREYHOUND  PARK.  In  May  1995,  the Company entered into an
agreement with Lakes Regional Greyhound Park ("LRGP").  Under the terms of the
Agreement, the parties intend to form an entity to pursue a gaming development
at  LRGP's  pari-mutual  track  in Belmont, New Hampshire.  The entity will be
equally  owned  by  the  Company  and  LRGP and the Company will manage gaming
operations.   Under the agreement the Company is obligated to provide up to $4
million in funding to the entity of which the payment of $3 million is subject
to  certain  contingencies  including  the  passage  of legislation permitting
gaming at racetracks in New Hampshire.  There is no assurance that the Company
will have the funds to pursue such gaming opportunity.







                                     F-26

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

9.  OTHER COMMITMENTS AND CONTINGENCIES (CONTINUED):
PROMOTIONAL  SERVICES.    In April 1993, the Company entered into an agreement
with  Casino  Magic  Vacations  ("CMV"),  an  unrelated  company,  to  provide
promotional  services primarily related to customer travel arrangements to the
Company's Gulf Coast properties.  The Company's costs consisted of air charter
fees,  CMV  commissions,  compensation,  and  monthly  operating  expense
reimbursements  as  provided  for  under  the agreement.  The Company incurred
promotional  costs  under  the  agreement  of  approximately  $12,000,000  and
$6,100,000  for  the years ended December 31, 1994 and 1993, respectively.  In
October  1994,  the  Company  notified  CMV  of  its intent to reduce costs by
running  the air charter promotion in-house and began negotiations with CMV to
terminate the agreement.  The Company filed suit against CMV in December 1994.
 In August 1995, the Company was awarded $2.2 million, of which $1 million has
been paid.  There is no assurance that the Company will collect the balance of
this award; accordingly, this receivable has been fully reserved.

GREECE  MANAGEMENT  AGREEMENTS  In June 1994, the Company negotiated the terms
of  definitive agreements pursuant to which it would acquire a 49% interest in
a  proposed  gaming casino, Porto Carras, Porto Carras is located at the Porto
Carras  resort in northeastern Greece.  The Company invested approximately $20
million  for  its  49%  interest.    The  remaining 51% is owned by Touristiki
Georgiki  Exagogiki,  a  Greek  company  ("TGE").    Under  the  terms  of the
agreement, the Company managed the hotel and casino for a fee equal to 2.5% of
hotel  gross revenues and 10% of casino net operating income. The Company also
received  a  royalty  of  2%  of  casino  gross revenues. In December 1996 the
Company  sold  its  interest in Porto Carras and terminated all management and
royalty agreements associated with Porto Carras.

In  1995,  the  Company  entered  into an agreement with a consortium of Greek
companies  to manage and operate an American-style casino to be constructed in
Xanthi,  in the Thrace region of Northeastern Greece which is located near the
borders  of Bulgaria and Turkey.  The Tourism Ministry of Greece has awarded a
license  to  build  and  operate the casino to members of the consortium.  The
initial phase of the casino operation opened on December 1, 1995.  The Company
terminated this agreement in December 1996.
















                                     F-27

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

9.  OTHER COMMITMENTS AND CONTINGENCIES (CONTINUED):
LAND ACQUISITIONS.
The Company has acquired land and options to purchase land in order to enhance
the  Company's  developmental  and  licensing procurement potential in various
States.    However,  the  Company's  ability  to  develop  additional  gaming
properties  will  be subject to its ability to raise additional debt or equity
financing.    While the Company believes that such arrangements can, and will,
be made, there are no assurances that the Company will be able to procure such
licensing,  nor  be  able  to  raise  additional  debt  or equity financing on
acceptable terms.

On  July  13,  1993, the Company executed an option agreement, though the year
2000,  to acquire certain parcels of land in Alabama which may be suitable for
casino  gaming.   The total price to exercise the option is $15,000,000 and is
subject to an escalation index.  The option includes provisions to pay 4.9% of
income  before  income  taxes of all casinos and related business conducted by
the  Company  on  the optioned property for 10 years and an option to purchase
200,000  shares  of    the Company's stock at an exercise price of $5.8125 per
share.  Aggregate payments made of $1,210,000 are included in options and land
deposits at December 31, 1996.

On  August  31,  1993,  the  Company  assigned to the Company's Chairman (then
President  and  Chief Executive Officer) the Company's rights under a purchase
agreement for the acquisition of approximately 3.5 acres of unimproved land in
downtown  St. Louis, Missouri.  The purchase agreement was entered into by the
Company  on  June  16, 1993 and provided the Company the right to purchase the
land  at a price of $3,550,000.  In consideration for the Company's assignment
of  its  rights to purchase the land, the Company's Chairman acquired the land
and  granted to the Company an option to repurchase the land.  On November 30,
1993  the  Company  exercised  its  option  to  purchase the land at a cost of
$3,633,176.    No  gain or loss was recognized on the sale to the Company.  At
December  31, 1996, approximately $4,000,000 is included in  property held for
sale related to this transaction.

In  December  1993,  the  Company  obtained  an option at a cost of $77,500 to
purchase  additional  land  and  real  estate  located  in Downtown St. Louis,
Missouri  at a cost of $812,500, less the option price.  In February 1994, the
Company  exercised  its  option  and purchased the property in March 1994.  At
December  31,  1996, $820,421 is included in property held for sale related to
this transaction.





                                     F-28

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

9.  OTHER COMMITMENTS AND CONTINGENCIES (CONTINUED):
LAND ACQUISITIONS (CONTINUED).
On  January  11,  1994, the Company executed two, $20,000 option agreements to
acquire  land  in  Indiana  at  a  cost of $6,000 per acre on approximately 40
acres,  and  $7,000  per  acre  on  approximately  119  acres, or $240,000 and
$833,000,  respectively, less the option payments.  The options expire (i) one
year  from the date of the agreements or (ii) on the date the Company receives
a gaming license from the Indiana Gaming Commission, whichever term is longer.
 In  February  1995, the Company paid $6,000 for a two-year option to purchase
additional  land  in  Indiana at a cost of $7,000 per acre on approximately 35
acres or $245,000, less the option payment.  Aggregate payments of $46,000 are
included in options and land deposits at December 31, 1996 with respect to the
Indiana options.

On February 7, 1994, the Company paid $150,000 for a 90-day option to purchase
property  in  Pennsylvania  at  a  cost  of  $2,200,000.  Under the agreement,
additional  land  may  be  conveyed  at  $40,000  per  acre in addition to the
original  purchase price. The option was extended for eleven additional 90-day
periods  at  $50,000 for two 90-day periods, $62,500 for three 90-day periods,
$75,000  for  three  90-day  periods,  and  $87,500 for three 90-day periods.
Aggregate  payments  of  $512,500  previously made under this option agreement
were expensed in 1996 and the options were cancelled.

On March 12, 1994, a wholly-owned subsidiary of the Company acquired an option
to purchase certain property located in Boston, Massachusetts for $60,000,000.
In  December  1995, the Company abandoned all efforts to pursue gaming at this
site  and  expensed  $8,986,722  in costs associated with this property.  This
includes  the  discounted value of future option payments to be made until the
year 1999.

In  June  1994, the Company purchased property in Pennsylvania at a total cost
of approximately $2,000,000 which is included in property held for development
at December 31, 1996 and 1995.  In addition to the basic purchase price of the
property,  the  agreement  of  sale  requires  the  Company  to pay the seller
$5,000,000  if  the  Company  obtains  a  license to operate a casino gambling
operation on the premises at any time before May 31, 1999.





                                     F-29

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

9.  OTHER COMMITMENTS AND CONTINGENCIES (CONTINUED):
OPTION  TO  LEASE REAL ESTATE.  On December 11, 1993, the Company entered into
an  agreement  for  an  option  to  lease  certain  property  in Indiana.  The
agreement  requires  advance  payments  of $500,000 in each of four years, and
upon  exercise,  would  allow  the  Company  to  lease the subject property at
$1,000,000  per  year  for  twenty  years.    At  December 31, 1996, aggregate
payments  of  $2,000,000 under this agreement are included in options and land
deposits.

GULF  COAST DEVELOPMENT.  Future renewals of Casino Magic-Biloxi's Mississippi
gaming  license  are conditioned upon the completion of a hotel on or near the
premises,  or in the alternative, the completion of a hotel and golf course at
Casino Magic-BSL.  Both projects are included in the Company's plan for future
capital projects.
CONSULTING AGREEMENTS:

SISSETON-WAHPETON  DAKOTA  NATION.      In  early 1996, the Company, through a
wholly-owned  subsidiary  entered  into  a  consulting  agreement  with
Sisseton-Wahpeton Dakota Nation ("Sisseton").  The Company provided consulting
services  to Sisseton during the development and opening of a temporary casino
facility, on Tribal land, for a fee of $350,000.  The agreement also specifies
that  the Company provide consulting services to Sisseton after the opening of
the  temporary  facility for a period of two years and includes unlimited  one
year  extensions.   The fee for these services is based upon gross revenues of
the  hotel  and casino facility and can range from $0 to $4,500,000 per year.
No  fees  were  earned  in  1996  after  the  opening  of the temporary casino
facility. (See Note 2 for related note receivable.)

10.  SHAREHOLDERS' EQUITY:

RESTRICTED SHARES
Prior  to  the initial public offering, the Company sold an additional 900,000
shares  of  common  stock to outside investors at $1.17 per share.  Concurrent
with  the  sale, 450,000 shares of common stock held by the Company's Chairman
and  principal shareholder and an employee of the Company were returned to the
Company  for  cancellation.    The  net  effect  of  these transactions was an
increase of 450,000 shares outstanding.

In  August and September 1994, the Company sold a total of 1,700,000 shares of
common  stock  to  foreign  investors.    The  shares  were issued pursuant to
Regulation  "S"  as  an  exemption  to  the provisions under the United States
Securities  Act  of 1933, as amended (the "Act").  Aggregate proceeds from the
issuance, net of offering costs of $727,750, were $10,173,000.








                                     F-30

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

10.  SHAREHOLDERS' EQUITY:(CONTINUED):

UNDESIGNATED SHARES:

In  January  and  February  1995,  the  Company sold an aggregate of 1,771,000
shares of common stock to foreign investors which were also issued pursuant to
Regulation  "S"  as  an  exemption to the provisions under the Act.  Aggregate
proceeds  from  the  issuance,  net  of  offering  costs  of  $534,195,  were
$8,320,805.

Approximately  12,450,000  of the Company's outstanding shares of common stock
were  restricted  as  to  the  length  of  time the shares must be held before
divestment and the quantities that can be traded when sold.  Substantially all
of the shares currently held became eligible for trading in limited quantities
commencing after May 1994.

UNDESIGNATED SHARES:

The  Board  of  Directors  is  authorized  to  determine,  without shareholder
approval,  the rights, preferences and privileges of 2,500,000 authorized, but
unused, undesignated shares.  Accordingly, the dividend and liquidation rights
of  the shareholders of common stock may be subordinate to those of holders of
undesignated shares, if and when such shares are designated and issued.

WARRANT REGISTRATION:

The  Company  registered  up to 2,743,500 shares of common stock for offer and
sale  to  the  holders  of  outstanding warrants of the Company exercisable at
$1.50  per share, and up to 1,110,000 shares of common stock to the holders of
outstanding  warrants  of  the  Company  exercisable  at  $2.75  per share. In
February  1995,  the  Company  filed a post effective amendment to remove from
registration  980,000  remaining shares of common stock issuable to holders of
the  foregoing  outstanding  warrants,  at  an  exercise price of $2.75. As of
December  31,  1995,  2,873,500 warrants were exercised resulting in aggregate
proceeds of $4,381,420, net of registration costs and expenses  of $91,330.













                                     F-31

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

11.  STOCK AND EMPLOYEE BENEFIT PLANS:

In  October  1995, the FASB issued Statement of Financial Accounting Standards
No. 123 ("SFAS 123"), "Accounting for Stock-Based Compensation," effective for
the  Company  for  1996.   Under SFAS 123, companies can either record expense
based  on the fair value of stock based compensation upon issuance or elect to
remain  under  the current "APB Opinion No. 25" method whereby no compensation
cost is recognized upon grant if certain requirements are met.  The Company is
continuing to account for its stock-based compensation plans under APB Opinion
No.  25.    However,  pro forma disclosures as if the Company adopted the cost
recognition requirements under SFAS 123 are presented below.

INCENTIVE STOCK OPTION PLAN:

In  1992,  the  Company adopted an incentive stock option plan (the "Plan") in
which  directors, officers, and key employees of the Company participate.  The
Company  has  registered  3,700,000  shares  of  the  Company's  common  stock
currently  authorized  for issuance under the Plan pursuant to stock options.
Under  the  Plan, options may be granted for a term of up to ten years, except
for  options  granted  to  owners  of 10% or more of the Company's outstanding
common  stock,  which  must  be  exercised within five years from the date the
option  is granted.  Vesting of all options granted is contingent on continued
employment with the Company prior to the exercise date.  The option prices are
determined  by  a  stock  option committee composed of members of the Board of
Directors  (the  "Stock Option Committee") and cannot be less than the greater
of  (i)  the fair market value of the shares on the date the option is granted
or (ii) the average of the closing sales prices for the Company's common stock
for  the  thirty  (30)  consecutive  trading  days  commencing forty-five (45)
trading  days prior to the date of grant, or less than 110% of the fair market
value  of the shares in the case of 10% or more shareholders.  Under the plan,
options  to  purchase a total of 1,502,600, 1,799,730, and 2,191,420 shares of
common  stock  were  outstanding  as  of  December  31,  1996,  1995 and 1994,
respectively.    As  of December 31, 1996, 867,564 incentive stock options had
been  exercised  for  an  aggregate  proceeds  of  $1,086,283.  The plan has a
provision which provides for employees to exchange existing stock held for the
exercise  price  of  the  option  5.  Under this provision, exercies of 66,231
shares  in  1996  are  shown in the table below which are not reflected in the
statement  of shareholder's equity as the exchange resulted in no net increase
in common shares outstanding.

REPRICING OF OPTIONS:

Upon  consideration  of recommendations of the Company's management, the Stock
Option Committee and the Board of Directors determined that it was in the best
interests  of  the  Company  to  reduce  the exercise price of incentive stock
options,  as well as options granted outside of the Plan, so that the exercise
price  would  more  closely  reflect the current market price of the Company's
common stock and therefore assist in retaining the interest of such employees,
officers  and  consultants  in  the  advancement of the Company's business and
rewarding  them  should  such  advancement  enhance  the  market  value of the
Company's common stock.  On July 25, 1996, on January 18, 1994 and on July 27,
1994,  the  Stock  Option  Committee  and  the  Board of Directors reduced the
exercise  price  of  incentive stock options and nonincentive stock options to
$3.63, $14.75 and $7.20 per share, respectively.

                                     F-32

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

11.  STOCK AND EMPLOYEE BENEFIT PLANS (CONTINUED):
OPTIONS GRANTED OUTSIDE OF THE PLAN:

During  February  and March 1994, the Company granted options outside the plan
for  44,000  shares of common stock, to each of three executive officers, that
vest  over  a  period of four years, at exercise prices ranging from $14.25 to
$15.75 per share.  These options were repriced to $7.20 per share in July 1994
and  have been canceled as of December 1995 due to the officers not fulfilling
their obligations under the option agreements.

In April 1994, the Company granted options outside the Plan for 200,000 shares
of  common  stock  to  the Sisseton-Wahpeton Dakota Nation (the "Tribe") at an
exercise  price  of  $15.30  per share.  The options are exercisable in annual
increments  of  20,000  shares  each  commencing  on April 21, 1995 subject to
approvals  and  the  continuation  of  gaming  as contemplated by a consulting
agreement between the Tribe and a wholly-owned subsidiary of the Company.

In  July  1994,  the  Company  granted options outside the Plan for 15,000 and
75,000 shares, respectively to each of two outside directors, exercisable at a
price  of  $7.20 per share.  The options are exercisable in the same manner as
those  previously  granted  to the other directors. In March 1994, the Company
granted  25,000  restricted shares of common stock, to each of three executive
officers,  that  vest  over  a period of four years.  Unearned compensation of
$1,190,625  had  been  computed  at $15.875 per share, the market value at the
date  of  grant.    During  1995,  16,250 shares were vested and the remaining
58,750  have  been  canceled  as  a  result  of  officers not fulfilling their
obligations  under  the related agreements.  As a result of this cancellation,
the  Company  reversed  into  income  amortization of unearned compensation of
$146,072 recognized in 1994.

In  June 1995, the Company granted options outside the Plan for 200,000 shares
of  common  stock  to Atlantic Land Corp. ("Atlantic") at an exercise price of
$5.8125 per share.  These options were granted as partial compensation for the
exclusive  option  to purchase land.  The options were fully exercisable as of
June 26, 1995.

In  November  1995,  the  Company  granted  25,000 restricted shares of common
stock,  to  an  executive  officer,  that  vest  over a period of four years.
Unearned  compensation  of $101,563 has been computed at $4.063 per share, the
market  value  at  the  date  of grant, and will be amortized through November
1999.

In  December  1995,  the  Company granted options outside the plan for 490,000
shares  of  common  stock  to an executive officer, that vest over a period of
five years, at an exercise price of $4.75 per share.  The options were granted
at above market prices.

In  May 1996, the Company granted 25,000 restricted shares of common stock, to
an  executive  officer,  that  vest  over  a  period  of four years.  Unearned
compensation  of  $135,938  has  been computed at $5.438 per share, the market
value at the date of grant, and will be amortized through May 2000.

                                     F-33

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

11.  STOCK AND EMPLOYEE BENEFIT PLANS (CONTINUED):
ADDITIONAL INFORMATION RELATING TO OPTION ACTIVITY (CONTINUED):

On  December 31, 1996, 532,850 of a total of 1,345,000 options granted outside
the Plan were exercisable, and 20,000 options have been exercised to date.

On  December 31, 1996, 1,091,785 of a total of 2,841,080 options granted under
the  Plan  were  exercisable,  and  1,310,900 shares were available for future
grants under the Plan.

Total  compensation  expense  (income),  net  of  recoveries,  of  $188,580,
($436,571), and $770,180 was recognized for the years ended December 31, 1996,
1995 and 1994, respectively.  Compensation expense for the year ended December
31,  1995  consisted of $65,017 of compensation expense reduced by $501,588 of
compensation  expense recoveries from prior years as a result of optionees not
fulfilling their obligations under the related agreements.

A summary of the status of the Company's stock options, non-qualified options,
and  warrants  as  of  December 31, 1996 and 1995 and changes during the years
ended on those dates is presented below (shares in thousands):
                                            December 31,
                                      1996                1995         .
                                         Wgtd. Avg.           Wgtd. Avg.
                                Shares   Exer. Price Shares  Exer. Price
Outstanding at beginning
  of year                       5,108      $7.60      4,943    $7.42
Granted                         1,695       3.63        950     5.06
Exercised                        (424)      1.72       (344)    1.43
Canceled                       (2,482)     12.00       (441)    4.61

Outstanding at end
  of year                       3,897      $3.74      5,108    $7.60

Options exercisable at
  end of year                   2,655      $3.11      3,072    $9.12

Options available for
  future grant under the plan   1,311                 1,583

Weighted average fair
  value of options granted
  during the year               $1.11                 $1.28

The  fair  value  of  each  option  granted  during  the  periods presented is
estimated  on  the  date of grant using the Black-Scholes option-pricing model
with  the  following  assumptions:  (1)  dividend  yield  of  0%, (2) expected
volatility  of  20%,  (3)  risk-free  interest rates of 5.2%, 5.26%, 5.47% and
5.5%, and (4) expected life of 2.25, 4.5, 6.75, and 9 years.

The  following  table  summarizes information about stock options and warrants
outstanding at December 31, 1996:

                                     F-34

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

11.  STOCK AND EMPLOYEE BENEFIT PLANS (CONTINUED):
               Options Outstanding                 Options Exercisable
Range of    Number      Wgtd. Avg.   Wgtd. Avg. Number        Wgtd. Avg.
Exercise    Outstanding Remaining    Exercise   Exercisable   Exercise
Prices      at 12/31/96 Contr. Life  Price      at 12/31/96   Price
$0.00- $1.17     86,000   0.58        $1.17        39,750       $1.17
 1.42-  1.42    600,000   0.49         1.42       600,000        1.42
 1.67-  1.67    220,000   0.76         1.67       220,000        1.67
 2.75-  2.75    980,000   0.81         2.75       980,000        2.75
 2.83-  2.83     48,000   0.58         2.83        34,500        2.83
 3.63-  3.63  1,393,600   4.35         3.63       407,785        3.63
 5.81-  5.81    200,000   5.48         5.81       200,000        5.81
 7.20-  7.20    119,100   3.67         7.20        82,600        7.20
 7.35-  7.35     50,000   2.88         7.35        50,000        7.35
15.30- 15.30    200,000   7.30        15.30        40,000       15.30
$0.00-$15.30  3,896,700   2.75        $3.74     2,654,635       $3.11

Had  compensation  cost for the Company's 1996 and 1995 grants for stock-based
compensation plans been determined consistent with SFAS 123, the Company's net
income  and  net earnings (loss) per common share for the years ended December
31, 1996 and 1995 would approximate the pro forma amounts below (in thousands,
except per share data):
                                         December 31,
                                1996                     1995
                     As Reported    Pro Forma   As Reported  Pro Forma
Net Income (Loss)    $(31,589)      $(32,344)    $(10,292)    $(11,131)
Earnings per common share
   Primary             $(0.88)      $(0.90)       $(0.30)        $(0.33)
   Fully diluted       $(0.89)      $(0.91)       $(0.31)        $(0.33)

The  effects  of  applying  SFAS  123  in  this  pro  forma disclosure are not
indicative  of  future  amounts.    SFAS 123 does not apply to awards prior to
1995, and additional awards in future years are anticipated.

PENSIONS AND OTHER BENEFITS:
        The  Company  currently sponsors no post-retirement or post-employment
employee benefit plans.

CASINO MAGIC CORP. 401(K) PLAN:
      In  July  1993,  the  Company adopted The Casino Magic Corp. 401(k) Plan
(the  "401(k)  Plan"),  a  defined  contribution  plan  covering  all eligible
employees  of  the Company who have one year of service and are age twenty-one
or  older.    The  401(k)  Plan  is  subject to the provisions of the Employee
Retirement  Income  Security Act of 1974 (ERISA).  Each year, participants may
contribute  up  to 15% of pretax annual compensation, as defined in the 401(k)
Plan.    The  Company's  matching  and/or  additional  contributions  may  be
contributed  at  the  discretion  of  the  Company's  Board of Directors.  The
Company's  contributions  to  the  401(k)  Plan  are  allocated  to  employed
participants'  accounts  as  of the last day of the plan year.  Total employer
contributions  to  the  401(k)  Plan  at December 31, 1996, 1995 and 1994 were
approximately $176,000, $177,000 and $145,000, respectively.

                                     F-35

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


       INCENTIVE  STOCK  OPTION PLAN:In 1992, the Company adopted an incentive
stock  option plan (the "Plan") in which directors, officers and key employees
of  the  Company participate.  The Company has  registered 3,700,000 shares of
the  Company's  common  stock currently authorized for issuance under the Plan
pursuant  to stock options.  Under the Plan, options may be granted for a term
of up to ten years, except for options granted to owners of 10% or more of the
Company's  outstanding common stock, which must be exercised within five years
from  the  date  the  option  is  granted.   Vesting of all options granted is
contingent  on  continued  employment  with  the Company prior to the exercise
date.    The option prices are determined by a stock option committee composed
of members of the Board of Directors (the "Stock Option Committee") and cannot
be  less  than  the  greater of (i) the fair market value of the shares on the
date the option is granted or (ii) the average of the closing sales prices for
the  Company's  common  stock  for  the  thirty  (30) consecutive trading days
commencing  forty-five  (45)  trading days prior to the date of grant, or less
than  110%  of  the fair market value of the shares in the case of 10% or more
shareholders.    Under  the  plan,  options  to purchase a total of 1,799,730,
2,191,420 and 2,138,250 shares of common stock were outstanding as of December
31,  1995,  1994  and  1993,  respectively.   As of December 31, 1995, 443,814
incentive  stock  options  had  been  exercised  for  an aggregate proceeds of
$626,216.

In May 1993, vesting schedules for some of the Plan participants were modified
to  allow the aggregate fair market value (determined at the time of the grant
of  the  option)  of  the number of shares of common stock purchasable for the
first  time  during  any  calendar  year not to exceed the $100,000 limitation
imposed by Section 422(d) of the Internal Revenue Code.

OPTIONS GRANTED OUTSIDE OF THE PLAN:

On  May  14,  1993,  the  Company  granted options outside the Plan for 60,000
shares  of common stock to an outside Director and for 60,000 shares of common
stock  to  a consultant currently exercisable at $7.20 per share (market value
at  date  of  reprice,  originally  granted  at $20.83 per share).  The 60,000
options granted to the director are exercisable in increments of 12,000 shares
each  after the first, second, third and fourth years following  this election
as  director,  so  long as he consents to serve in such capacity.  The options
will terminate at the end of the fifth year following  his initial election as
a  member  of  the  Board  of  Directors.    The 60,000 options granted to the
consultant are fully exercisable, and will terminate in May 1997.

On  April  21,  1993,  the Company granted options outside the Plan for 60,000
shares  of  common  stock  to  each  of  two consultants in connection with an
agreement  to  develop,  administer and operate air charter services performed
under  the  name  "Casino  Magic  Vacations."  The options were exercisable at
$8.33  per  share  over  a  four-year  period  through October 1997.  Unearned
compensation of $670,000 had been computed as the difference between the $8.33
per  share exercise price and the $13.92 per share market value at the date of
the  grant.    These  options were canceled in 1995 due to the consultants not
fulfilling their obligations under the option agreements.  As a result of this
cancellation,  in  1995  the  Company  reversed  into  income  amortization of
unearned  compensation  of  $265,208  and $72,584 recognized in 1994 and 1993,
respectively.
During  February  and March 1994, the Company granted options outside the plan
for  44,000  shares of common stock, to each of three executive officers, that
vest  over  a  period of four years, at exercise prices ranging from $14.25 to
$15.75 per share.  These options were repriced to $7.20 per share in July 1994
and  have been canceled as of December 1995 due to the officers not fulfilling
their obligations under the option agreements.

In April 1994, the Company granted options outside the Plan for 200,000 shares
of  common  stock  to  the Sisseton-Wahpeton Dakota Nation (the "Tribe") at an
exercise  price  of  $15.30  per share.  The options are exercisable in annual
increments  of  20,000  shares  each  commencing  on April 21, 1995 subject to
approvals  and  the  continuation  of  gaming  as contemplated by a consulting
agreement between the Tribe and a wholly-owned subsidiary of the Company.

In  July  1994,  the  Company  granted options outside the Plan for 15,000 and
75,000,  respectively to each of two outside directors, exercisable at a price
of  $7.20  per share.  The options are exercisable in the same manner as those
previously granted to the other directors.

In  March  1994, the Company granted 25,000 restricted shares of common stock,
to  each  of three executive officers, that vest over a period of four years.
Unearned  compensation  of  $1,190,625 had been computed at $15.875 per share,
the market value at the date of grant.  During 1995, 16,250 shares were vested
and  the  remaining  58,750  have  been  canceled  as a result of officers not
fulfilling  their  obligations  under  the related agreements.  As a result of
this  cancellation,  the Company reversed into income amortization of unearned
compensation of $146,072 recognized in 1994.

In  June 1995, the Company granted options outside the Plan for 200,000 shares
of  common  stock  to Atlantic Land Corp. ("Atlantic") at an exercise price of
$5.8125 per share.  These options were granted as partial compensation for the
exclusive  option  to  purchase land.  The options are fully exercisable as of
June 26, 1995.

In  November  1995,  the  Company  granted  25,000 restricted shares of common
stock,  to  an  executive  officer,  that  vest  over a period of four years.
Unearned  compensation  of $101,563 has been computed at $4.063 per share, the
market  value  at  the  date  of grant, and will be amortized through November
1999.

OPTIONS GRANTED OUTSIDE OF THE PLAN:

In  December  1995,  the  Company granted options outside the plan for 490,000
shares  of  common  stock  to an executive officer, that vest over a period of
five years, at an exercise price of $4.75 per share.  The options were granted
at above market prices.

       REPRICING OF OPTIONS:

Upon  consideration  of recommendations of the Company's management, the Stock
Option Committee and the Board of Directors determined that it was in the best
interests  of  the  Company  to  reduce  the exercise price of incentive stock
options,  as well as options granted outside of the Plan, so that the exercise
price  would  more  closely  reflect the current market price of the Company's
common stock and therefore assist in retaining the interest of such employees,
officers  and  consultants  in  the  advancement of the Company's business and
rewarding  them  should  such  advancement  enhance  the  market  value of the
Company's  common  stock.  On January 18, 1994 and on July 27, 1994, the Stock
Option  Committee  and  the  Board  of Directors reduced the exercise price of
incentive stock options and nonincentive stock options to $14.75 and $7.20 per
share, respectively.

       ADDITIONAL INFORMATION RELATING TO OPTION ACTIVITY (CONTINUED):

At  December 31, 1995, 246,000 of a total of 1,320,000 options granted outside
the Plan were exercisable, and 20,000 options have been exercised to date.

At  December  31,  1995, 652,790 of a total of 1,795,980 options granted under
the  Plan  were  exercisable,  and  1,904,020 shares were available for future
grants under the Plan.

Unearned  compensation,  originally in the amount of $457,500, computed as the
difference  between  the  exercise price of the options and the initial public
offering price (market value at the date of grant), is being amortized through
July 1996.

Total  compensation  expense  (income),  net  of  recoveries,  of  ($436,571),
$770,180  and  $238,437  was recognized for the years ended December 31, 1995,
1994 and 1993, respectively.  Compensation expense for the year ended December
31,  1995  consisted of $65,017 of compensation expense reduced by $501,588 of
compensation  expense recoveries from prior years as a result of optionees not
fulfilling their option agreements.


       ADDITIONAL INFORMATION RELATING TO OPTION ACTIVITY (CONTINUED):

                                              Option price    Proceeds
                                     Options    per share  on exercise

Outstanding at December 31, 1992   1,950,000                  $ 3,072,500
Granted:
Officers and key employees           441,000  $6.83 -$20.83     6,548,750
Consultants                          180,000  $8.33 -$20.83     2,250,000
Non-employee Directors                60,000     $20.83         1,250,000
Canceled or expired:
Officers and key employees           (12,750)     $1.67           (21,250)

Outstanding at December 31, 1993   2,618,250                   13,100,000
Granted:
Officers and key employees         1,484,800  $7.20 -$16.00    16,302,229
Consultants                          120,000  $7.20 -$14.75     1,317,000
Non-employee Directors               210,000  $7.20 -$14.75     1,965,000
Others (Sisseton-Wahpeton)           200,000     $15.30         3,060,000
Canceled or expired:
Officers and key employees        (1,144,380) $1.17 -$20.83   (17,128,217)
Consultants                         (120,000)$14.75 -$20.83    (2,135,000)
Non-employee Directors              (120,000)$14.75 -$20.83    (2,135,000)
Exercised:
Officers and key employees          (155,250) $1.17 -$2.83       (259,000)

Outstanding at December 31, 1994   3,093,420                   14,087,012
Granted:
Officers and key employees           725,000  $4.75 -$5.30      3,518,000
Others (Atlantic Land Corp.)         200,000      $5.81         1,162,600
Canceled or expired:
Officers and key employees          (473,876) $1.17 -$7.20     (2,639,303)
Consultants                         (120,000)     $8.33          (999,960)
Exercised:
Officers and key employees          (288,564) $1.17 -$2.83       (345,966)
Non-employee Directors               (20,000)     $1.67           (33,333)

Outstanding at December 31, 1995   3,115,980                 $ 14,749,050


         PENSIONS AND OTHER BENEFITS:
The  Company currently sponsors no post-retirement or post-employment employee
benefit plans.

        CASINO MAGIC CORP. 401(K) PLAN:

In  July  1993,  the  Company  adopted The Casino Magic Corp. 401(k) Plan (the
"401(k) Plan"), a defined contribution plan covering all eligible employees of
the Company who have one year of service and are age twenty-one or older.  The
401(k)  Plan  is  subject  to the provisions of the Employee Retirement Income
Security  Act  of  1974 (ERISA).  Each year, participants may contribute up to
15%  of  pretax  annual  compensation,  as  defined  in  the 401(k) Plan.  The
Company's  matching  and/or additional contributions may be contributed at the
discretion  of  the Company's Board of Directors.  The Company's contributions
to  the 401(k) Plan are allocated to employed participants' accounts as of the
last day of the plan year.  Total employer contributions to the 401(k) Plan at
December  31,  1996,  1995  and 1994 were approximately $176,000, $177,000 and
$145,000, respectively.

In  October  1995,  the FASB issued Staement of Financial Accounting Standards
No. 123 ("SFAS 123"), "Accounting for Stock-Based Compensation," effective for
the  Company  for  1996.   Under SFAS 123, companies can either record expense
based  on the fair value of stock based compensation upon issuance or elect to
remain  under  the current "APB Opinion No. 25" method whereby no compensation
cost is recognized upon grant if certain requirements are met.  The Company is
continuing to account for its stock-based compensation plans under APB Opinion
No.  25.    However,  pro forma disclosures as if the Company adopted the cost
recognition requirements under SFAS 123 are presented below.

In  1992,  the  Company adopted an incentive stock option plan (the "Plan") in
which  directors, officers, and key employees of the Company participate.  The
Company  has  registered  3,700,000  shares  of  the  Company's  common  stock
currently  authorized  for issuance under the Plan pursuant to stock options.
Under  the  Plan, options may be granted for a term of up to ten years, except
for  options  granted  to  owners  of 10% or more of the Company's outstanding
common  stock,  which  must  be  exercised within five years from the date the
option  is granted.  Vesting of all options granted is contingent on continued
employment with the Company prior to the exercise date.  The option prices are
determined  by  a  stock  option committee composed of members of the Board of
Directors  (the  "Stock Option Committee") and cannot be less than the greater
of  (i)  the fair market value of the shares on the date the option is granted
or (ii) the average of the closing sales prices for the Company's common stock
for  the  thirty  (30)  consecutive  trading  days commen cing forty-five (45)
trading  days prior to the date of grant, or less than 110% of the fair market
value of the shares in the case of 10% or more shareholders.

A  summary  of  the  status  of the Company's stock options as of December 31,
1996,  1995,  and  1994  and  changes during the years ended on those dates is
presented below (shares in thousands):

                                      1996                1995
                                         Wgtd. Avg.          Wgtd. Avg.
                                Shares   Exer. Price Shares  Exer. Price
Outstanding at beginning
  of year                       5,106      $7.60      4,943    $7.42
Granted                         1,695       3.63        950     5.06
Exercised                        (424)      1.72       (344)    1.43
Canceled                       (2,482)     12.00       (442)    4.61

Outstanding at end
  of year                       3,897      $3.74      5,108    $7.60

Options exercisable at
  year-end                      2,655                 3,072

Options available for
  future grant

Weighted average fair
  value of options granted
  during the year

The  fair  value  of  each  option  granted  during  the  periods presented is
estimated  on  the  date of grant using the Black-Scholes option-pricing model
with  the  following  assumptions:  (1)  dividend  yield  of  0%, (2) expected
volatility  of 20%, (3) risk-free interest rate of 5.5%, and (4) expected life
of 9 years.

The  following table summarizes information about stock options outstanding at
December 31, 1996:


               Options Outstanding                 Options Exercisable
Range of    Number      Wgtd. Avg.   Wgtd. Avg. Number        Wgtd. Avg.
Exercise    Outstanding Remaining    Exercise   Exercisable   Exercise
Prices      at 12/31/96 Contr. Life  Price      at 12/31/96   Price

$0   - $1.42    636,000  0.50       $1.40       636,000     $1.40
 1.67-  1.67    220,000  0.76        1.67       220,000      1.67
 2.75-  2.75    980,000  0.81        2.75       980,000      2.75
 2.83-  2.83     48,000  0.58        2.83        34,500      2.83
 3.63-  3.63  1,393,600  4.35        3.63       407,785      3.63
 5.81- 15.30    569,100  5.52        9.57       372,600      7.35

$0   -$15.30  3,846,700  2.75       $3.74     2,650,885     $3.11



Had  compensation  cost for the Company's 1996 and 1995 grants for stock-based
compensation plans been determined consistent with SFAS 123, the Company's net
income  and  net earnings (loss) per common share for the years ended December
31, 1996 and 1995 would approximate the pro forma amounts below (in thousands,
except per share data):

                                       December 31,
                                1996                     1995
                     As Reported    Pro Forma   As Reported  Pro Forma
Net Income (Loss)    $(31,859)      $(32,344)    $(10,292)    $(10,189)

Earnings per common share
   Primary             $(0.88)      $(0.90)       $(0.30)        $(0.30)
   Fully diluted       $(0.89)      $(0.91)       $(0.31)        $(0.31)

The  effects  of  applying  SFAS  123  in  this  pro  forma disclosure are not
indicative  of  future  amounts.    SFAS 123 does not apply to awards prior to
1995, and additional awards in future years are anticipated.

12. WRITE-OFF OF CAPITALIZED COSTS RELATING TO INACTIVE DEVELOPMENTS
In  1995  and  1994  the Company decided to terminate development efforts with
respect  to  specific  properties  and  jurisdictions.    Because  of  this
determination, significant capitalized amounts relating to land, land options,
joint  ventures  and  construction  projects were written-off or revalued.  In
addition,  certain  consulting  agreements  that  were  entered into to pursue
gaming  opportunities  in  new  jurisdictions  were  terminated.   The amounts
expensed  in  the  fourth  quarter  of  1995  and  1994  were  $14,542,164 and
$5,479,164 respectively.

13. ADVERTISING
The company expenses all production and communication costs of advertising
as incurred.  Advertising expense was approximately $5,470,000, $4,472,000,
and  $2,650,000  for  years  ended  December  31,  1996,  1995,  and  1994,
respectively.

14. RELATED PARTY TRANSACTIONS:
During the years ended December 31, 1996, 1995, and 1994, the Company incurred
$1,346,861,  $353,888,  and  $1,874,747,  respectively,  for architectural and
design  services  provided by an architectural firm that is wholly-owned by an
outside director and shareholder of the Company.

During the years ended December 31, 1996, 1995, and 1994, the Company incurred
$154,028, $388,944, and $566,072, respectively, for legal services provided by
a law firm in which an outside director of the Company is a shareholder.

During  the  year  ended  December  31,  1996  and  1995, the Company incurred
$219,800,  and $387,422, respectively, for charter plane rentals provided by a
company that is wholly owned by the Company's Chairman.
The  Company  purchased  a  jet  airplane  in February 1996 from the Company's
Chairman.    The Company paid $1.7 million for the airplane which approximated
fair value at the date of purchase.

15. INCOME TAXES:
Pretax financial income (loss) generated from domestic and foreign sources was
as follows:
                                                   DECEMBER 31,
                                      1996             1995         1994
Domestic                        $ (15,322,992)  $ (15,336,975)  $ (3,218,490)
Foreign                             (20,942,537)    1,813,932
--
Total  pretax  loss                     $ (36,265,529)  $ (13,523,043)  $
(3,218,490)

Provision  (benefit)  for  income taxes for the years ended December 31, 1996,
1995 and 1994 are as follows:
                                                   DECEMBER 31,
                                                1996         1995
1994
Federal and state current       $ (4,253,704)  $ (2,546,443)   $ (2,616,095)
Foreign current                       827,548      1,099,816              --
Federal deferred                   1,250,026     (1,221,514)      2,428,056
Foreign deferred                           --       (562,723)
--
Total  provision                      $  (4,676,182)  $ (3,230,864)   $
(188,039)

                                    F-36

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

15. INCOME TAXES (CONTINUED):
Components of deferred tax liabilities (assets) are as follows:

                                                         DECEMBER 31,
                                                     1996           1995
Depreciation and amortization                     $ 9,535,121   $ 9,123,061
Foreign  sourced  income                                 257,949
--
Gross  deferred  tax  liabilities                            9,793,070
9,123,061
Write-off of preopening costs                      (2,493,074)   (1,087,058)
Tax benefits related to non-statutory stock
   Options                                           (504,000)     (504,000)
Accrued employee benefits and liabilities          (1,433,067)   (1,589,378)
Abandoned development projects                    (10,229,821)   (3,804,589)
Foreign sourced income                                     --      (562,723)
Net operating loss carryforward                    (2,269,344)           --
Other                                                         (798,293)
(507,159)
Gross  deferred  tax  assets                                  (17,727,599)
(8,054,907)
Less  valuation  allowance                           $ 8,201,290   $
--
Net  deferred  tax  liabilities                             $   266,761   $
1,068,154

The  provision  for  income  taxes  differs  from  the  amount  of  income tax
determined  by  applying the applicable U.S. statutory federal income tax rate
to  pre-tax  income  from  continuing  operations as a result of the following
differences:

                                                     DECEMBER 31,
                                               1996          1995
1994
Statutory U.S. tax rate (35%)        $(12,692,935) $ (4,733,065) $ (1,126,472)
Increase (decrease) in rates resulting
from:
Expenses which were non-deductible for
   tax purposes                           357,805       733,876       985,816
Foreign taxes                             827,548     1,099,816            --
Valuation allowance                     8,201,290           --             --
State tax benefit                        (802,174)          --             --
Other                                        (577,716)     (331,491)
(47,383)
Effective tax rate
   ((13%), (24%) and (6%),
    respectively)                         $ (4,676,182)  $(3,230,864)  $
(188,039)

The  valuation  allowance  against  deferred  tax  assets  was  recorded  in
recognition  of  operating  losses  incurred by the Company for the last three
years.

Mississippi  State  taxes  were  offset by a tax credit for state gaming taxes
based on gross revenues realized by Casino Magic-BSL and Casino Magic-Biloxi.
The  credit  is  the lesser of the annual total gaming taxes paid or the state
income tax.  Credit carry-forwards are not permitted.
Louisiana  State  taxes do not allow for an offset of state gaming taxes based
on gross revenues realized by  Louisiana.
                                     F-37

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

16.  GEOGRAPHICAL DISTRIBUTION OF OPERATIONS:
      The following represents the geographical distribution of the Company:

                                                 (IN THOUSANDS)
                                     1996             1995           1994
Revenues:
  United States                    $161,292         162,415         185,018
  Europe                              1,910           1,479              --
  South America                      15,885          13,084              --
  General Corporate and
     non-operating  companies          1,191             745
--
                                   $180,278               177,723
185,018

Net Income (Loss):
  United States                    $  8,999          17,478          23,623
  Europe (1)                        (12,753)         (1,254)            104
  South America                       2,409           1,219              --
  General Corporate and
     non-operating  companies  (2)        (30,244)         (27,735)
(26,757)
                                   $(31,589)             (10,292)
(3,030)

Identifiable Assets:
  United States                     $315,153        172,746         168,681
  Europe                                 221         21,963          17,452
  South America                       12,641         15,498          13,289
  General Corporate and
     non-operating  companies              45,836         58,224
53,201
                                    $373,851               268,431
252,623

     (1)  Includes equity income (loss) from Porto Carras Casino SA.
     (2)  Includes total interest expense on bonds issued by Casino Magic
          Finance Corp.


















                                     F-38

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
17.   FAIR VALUE OF FINANCIAL INSTRUMENTS

Statement  of  Financial  Accounting Standards No. 107, "Disclosure about Fair
Value of Financial Instruments" requires disclosure of an estimate of the fair
value  of certain financial instruments.  The carrying amounts and fair values
of the Company's financial instruments at December 31, 1996 are as follows:
                                              CARRYING       FAIR
(IN THOUSANDS)                                AMOUNT      VALUE
Cash and cash equivalents (Including
  restricted cash)                            34,546        34,546
Accounts receivable, trade, aircharter,
   other, net                                  2,099         2,099
Notes receivable                               4,910         4,910
Notes payable and current maturities of
  long-term debt and long-term debt          262,910       277,910

The  following  methods and assumptions were used by the Company in estimating
its fair value disclosure:

Cash and cash equivalents, accounts receivable, trade, aircharter, other, net.
 The  carrying  amount reported on the consolidated balance sheet approximates
its fair value because of the short naturematurity of these instruments.

Notes  receivable.  This is a long-term note recievable from an Indian Tribe.
The  fair  value  of  the note approximates market value based on the interest
rate of the note and the collateral securing the note.

Notes  payable  and  current maturities of long-term debt and long-term debt.
The fair value of the Company's debt either approximates its carrying value or
is  based upon the market price of the debt instruments.

Fair  value  estimates are made at a specific point in time, based on relevant
market  information  and  information  about  the financial instrument.  These
estimates  are  subjective  in nature and involve uncertainties and matters of
significant  judgment  and  therefore  cannot  be  determined with precision.
Changes in assumptions could significantly affect the estimates.


















                                     F-39

<PAGE>
                     CASINO MAGIC CORP. AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

18.  SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED):

YEAR ENDED DECEMBER 31, 1996

(in thousands, except
per share amounts)     1st Quarter  2nd Quarter   3rd Quarter    4th Quarter
 Totals

Revenue                   $43,125      $42,368       $43,271        $51,514
$180,278

Income from operations     5,565        6,473         5,355         (8,550)
  8,843

Income  (loss) before tax   2,352        2,456       (26,024)       (15,050)
(36,266)

Net  income (loss)          1,644        1,660       (20,683)       (14,210)
(31,589)

Earnings (loss) per share:
Primary                     0.05         0.05         (0.57)         (0.40)
 (0.88)

Fully-diluted               0.05         0.05         (0.57)         (0.40)
 (0.89)

YEAR ENDED DECEMBER 31, 1995
(in thousands, except
per share amounts)    1st Quarter    2nd Quarter   3rd Quarter   4th Quarter
 Totals

Revenue                     $43,169       $45,185      $47,518       $41,851
$177,723

Income from operations      4,755         2,654        8,225       (10,863)
 4,771

Income  (loss) before tax      666        (2,258)       5,452       (17,383)
(13,523)

Net  income (loss)             322        (1,597)       3,402       (12,419)
(10,292)

Earnings (loss) per share:
Primary                      0.01         (0.05)       0.10          (0.36)
 (0.30)

Fully-diluted                0.01         (0.05)       0.10          (0.36)
 (0.31)

NOTE:  Earnings (loss) per share totals will note necessarily agree to the sum
of the quarterly information.
                                     F-40