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


                    			       FORM 10-Q


  X     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
            		 SECURITIES EXCHANGE ACT OF 1934 FOR THE
             		 QUARTERLY PERIOD ENDED OCTOBER 3, 1998

                          				   OR

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

            		       Commission file number 1-416



                     			 SEARS, ROEBUCK AND CO.
	         (Exact name of registrant as specified in its charter)



	New York                                  36-1750680
 (State of Incorporation)            (I.R.S. Employer Identification No.)


3333 Beverly Road, Hoffman Estates, Illinois                    60179
  (Address of principal executive offices)                   (Zip Code)

    Registrant's telephone number, including area code: 847/286-2500



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 and (2) has been subject to such filing requirements for the past
90 days.

		      Yes    X                No ____

As of September 30, 1998, the Registrant had 383,099,143 common shares,
$.75 par value, outstanding.


<PAGE>


			    Sears, Roebuck and Co.
		   Index to Quarterly Report on Form 10-Q
		    13 and 39 Weeks Ended October 3, 1998




                                                         									  Page
Part I - Financial Information.

  Item 1. Financial Statements.

	  Condensed Consolidated Statements of Income (Unaudited) -
	  13 and 39 Weeks Ended October 3, 1998 and September 27, 1997.       1

	  Condensed Consolidated Balance Sheets -
	  October 3, 1998 (Unaudited), September 27, 1997 (Unaudited)
	  and January 3, 1998.                                                2

	  Condensed Consolidated Statements of Cash Flows (Unaudited) -
	  39 Weeks Ended October 3, 1998 and September 27, 1997.              3

	  Notes to Condensed Consolidated Financial Statements (Unaudited).   4

	  Independent Accountants' Review Report.                             8

  Item 2. Management's Discussion and Analysis of Financial Condition,
	  Results of Operations and Liquidity.                                9


Part II - Other Information.

  Item 1. Legal Proceedings.                                                 17

  Item 6. Exhibits and Reports on Form 8-K.                                  18


<PAGE>
<TABLE>

				     -1-


                   			 PART I. FINANCIAL INFORMATION
			                     ITEM I. FINANCIAL STATEMENTS
			                        SEARS, ROEBUCK AND CO.
		              CONDENSED CONSOLIDATED STATEMENTS OF INCOME
				                            (Unaudited)

<CAPTION>

                                          							          13 Weeks Ended            39 Weeks Ended
							                                                   Oct. 3,    Sept. 27,      Oct. 3,     Sept. 27,
(millions, except per share data)                         1998        1997          1998         1997
<S>                                                        <C>        <C>           <C>           <C>

Revenues                                                                                     
  Merchandise and services                               $ 8,646     $ 8,528      $ 25,662     $ 24,618
  Credit revenues                                          1,102       1,254         3,496        3,596
    Total revenues                                         9,748       9,782        29,158       28,214

Costs and expenses
  Cost of sales, buying and occupancy                      6,413       6,335        19,147       18,304
  Selling and administrative                               2,033       1,980         6,016        5,873
  Depreciation and amortization                              204         190           623          573
  Provision for uncollectible accounts                       288         357         1,037          898
  Interest                                                   341         328         1,078        1,021
  Reaffirmation charge                                        -           -             -           475
  Western Auto impairment loss                               296          -            296           -
    Total costs and expenses                               9,575       9,190        28,197       27,144
Operating income                                             173         592           961        1,070
Other income, net                                             15           1            24          137
Income before income taxes, minority interest
    and extraordinary loss                                   188         593           985        1,207
Income taxes                                                (113)       (234)         (428)        (542)

Minority interest                                             (7)         (6)          (20)         (13)

Income before extraordinary loss                              68         353           537          652
Extraordinary loss (net of income tax benefit of $13)        (24)         -            (24)          -
Net income                                               $    44     $   353      $    513     $    652
Net income (loss) consists of:
  Domestic operations                                    $    39     $   346      $    499     $    686
  International operations                                     5           7            14          (34)
Net income                                               $    44     $   353      $    513     $    652

Earnings per share - basic:
  Income before extraordinary loss                       $  0.17     $  0.90      $   1.38     $   1.66
  Extraordinary loss                                       (0.06)         -          (0.06)          -
  Net income                                             $  0.11     $  0.90      $   1.32     $   1.66
Earnings per share - diluted:
  Income before extraordinary loss                       $  0.17     $  0.89      $   1.36     $   1.64
  Extraordinary loss                                       (0.06)         -          (0.06)          -
  Net income                                             $  0.11     $  0.89      $   1.30     $   1.64

Cash dividends declared per share                        $  0.23     $  0.23      $   0.69     $   0.69

Average common and common
 equivalent shares outstanding                             391.4       398.5         393.7        398.3


<FN>
See accompanying notes.
</FN>
</TABLE>

<PAGE>

				      -2-
<TABLE>

                       			     SEARS, ROEBUCK AND CO.
		                       CONDENSED CONSOLIDATED BALANCE SHEETS

<CAPTION>
                      								                                       (Unaudited)
								                                                         Oct. 3,     Sept. 27,      Jan. 3,
(millions)                                                        1998         1997          1998
<S>                                                               <C>          <C>           <C>
Assets
 Current assets
  Cash and cash equivalents                                     $    327      $    247      $    358
  Retained interest in transferred credit card receivables         4,577         3,212         3,316
  Credit card receivables, net                                    16,792        18,307        19,843
  Other receivables                                                  358           287           335
  Merchandise inventories                                          5,864         5,669         5,044
  Prepaid expenses and deferred charges                              577           439           518
  Deferred income taxes                                              806           915           830
   Total current assets                                           29,301        29,076        30,244

Property and equipment, net                                        6,493         6,062         6,414
Deferred income taxes                                                676           798           666
Other assets                                                       1,262           930         1,376
   Total assets                                                 $ 37,732      $ 36,866      $ 38,700

Liabilities
 Current liabilities
  Short-term borrowings                                         $  5,439      $ 3,987       $  5,208
  Current portion of long-term debt and capitalized leases         2,143        2,428          2,561
  Accounts payable and other liabilities                           6,379        7,192          6,637
  Unearned revenues                                                  823          874            830
  Other taxes                                                        419          455            554
   Total current liabilities                                      15,203       14,936         15,790

Long-term debt and capitalized leases                             13,022       12,523         13,071
Postretirement benefits                                            2,432        2,598          2,564
Minority interest and other liabilities                            1,403        1,404          1,413
   Total liabilities                                              32,060       31,461         32,838

Commitments and Contingent Liabilities (note 7)

Shareholders' Equity
 Common shares                                                       323          323            323
 Capital in excess of par value                                    3,587        3,596          3,598
 Retained income (note 2)                                          4,402        3,712          4,158
 Treasury stock - at cost                                         (2,109)      (1,653)        (1,702)
 Minimum pension liability                                          (217)        (277)          (217)
 Deferred ESOP expense                                              (185)        (215)          (204)
 Cumulative translation adjustments                                 (129)         (81)           (94)
   Total shareholders' equity                                      5,672        5,405          5,862

   Total liabilities and shareholders' equity                   $ 37,732     $ 36,866       $ 38,700

   Total common shares outstanding                                 383.1        392.0          390.9

<FN>
See accompanying notes.
</FN>
</TABLE>



<PAGE>
				      -3-

<TABLE>
                     			     SEARS, ROEBUCK AND CO.
		               CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
				                              (Unaudited)


<CAPTION>
                                                          									   39  Weeks Ended
								                                                            Oct. 3,         Sept.27,
(millions)                                                           1998             1997
<S>                                                                   <C>             <C>

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income                                                          $   513         $   652
Adjustments to reconcile net income to net cash
 provided by (used in) operating activities:
   Depreciation, amortization and other noncash items                   675             696
   Extraordinary loss on early extinguishment of debt                    37              -
   Provision for uncollectible accounts                               1,037             898
   Western Auto impairment loss                                         296              -
   Gain on sales of property and investments                            (18)           (118)
   Change in (net of acquisitions):
     Deferred income taxes                                               14              89
     Retained interest in transferred credit card receivables        (1,261)           (952)
     Credit card receivables                                          1,893             (73)
     Merchandise inventories                                           (852)         (1,088)
     Other operating assets                                             (60)            (68)
     Other operating liabilities                                       (360)           (268)
       Net cash provided by (used in) operating activities            1,914            (232)

CASH FLOWS FROM INVESTING ACTIVITIES:

Acquisition of businesses, net of cash acquired                         (34)           (115)
Net proceeds from sales of businesses                                    -              379
Proceeds from sales of property and investments                          23              10
Purchases of property and equipment                                  (1,015)           (803)
       Net cash used in investing activities                         (1,026)           (529)

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from long-term debt                                          2,023           2,473
Repayments of long-term debt                                         (2,516)         (2,464)
Increase in short-term borrowings, primarily 90 days or less            245             613
Repayments of ESOP note receivable                                       23              16
Common shares purchased                                                (522)           (114)
Common shares issued for employee stock plans                           104              95
Dividends paid to shareholders                                         (270)           (269)
       Net cash (used in) provided by financing activities             (913)            350

Effect of exchange rate on cash and invested cash                        (6)             (2)

Net decrease in cash and cash equivalents                               (31)           (413)

Balance at beginning of year                                            358             660

Balance at end of period                                            $   327         $   247


<FN>
See accompanying notes.
</FN>
</TABLE>


<PAGE>
				      -4-


                       			    SEARS, ROEBUCK AND CO.
	               NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               				  (Unaudited)


1.  Condensed Consolidated Financial Statements

    The Condensed Consolidated Balance Sheets as of October 3, 1998 and
    September 27, 1997, the related Condensed Consolidated Statements of
    Income for the 13 and 39 weeks ended October 3, 1998 and September 27,
    1997 and the Condensed Consolidated Statements of Cash Flows for the 39
    week periods ended October 3, 1998 and September 27, 1997 are unaudited.
    The interim financial statements reflect all adjustments (consisting only
    of normal recurring accruals) which are, in the opinion of management,
    necessary for a fair statement of the results for the interim periods
    presented.  The condensed consolidated financial statements should be read
    in conjunction with the consolidated financial statements and notes
    thereto included in the Sears, Roebuck and Co. 1997 Annual Report to
    Shareholders and Annual Report on Form 10-K.  The results of operations
    for the interim periods should not be considered indicative of results
    to be expected for the full year.

    Certain reclassifications have been made in the 1997 financial statements
    to conform with the current year presentation.

2.  Shareholders' Equity and Dividend Restrictions

    Under terms of indentures entered into in 1981 and thereafter, Sears
    (the "Company") cannot take specified actions, including the declaration
    of cash dividends, which would cause its unencumbered assets, as defined,
    to fall below 150% of its liabilities, as defined.  At October 3, 1998,
    approximately $4.2 billion could be paid in dividends to shareholders
    under the most restrictive indentures.

    On February 3, 1998, the Board of Directors extended, for an additional
    two years, the common share repurchase program which is used to acquire
    shares for distribution in connection with the expected exercise of
    stock options, the grant of restricted shares and the exchange of
    deferred shares under the Company's stock plans.  The program authorizes
    the Company to acquire up to 20 million Sears common shares on the open
    market.  Through October 3, 1998, 17.4 million common shares had been
    acquired under the repurchase program.

3.  Earnings Per Share

    The following table sets forth the computations of basic and diluted
    earnings per share:

<TABLE>
<CAPTION>
                                       							            13 Weeks Ended            39 Weeks Ended
						                                                 Oct. 3,      Sept. 27,    Oct. 3,      Sept. 27,
(millions, except per share data)                      1998          1997        1998          1997
<S>                                                    <C>           <C>         <C>           <C>
Basic:
 Net income                                           $    44      $   353      $   513      $   652
 Average shares outstanding                             388.6        391.8        390.4        391.7
 Earnings per share -basic                            $  0.11      $  0.90      $  1.32      $  1.66

Diluted:
 Net income                                           $    44      $   353      $   513      $   652
 Average shares outstanding                             388.6        391.8        390.4        391.7
 Dilutive effect of stock options                         2.8          6.7          3.3          6.6
 Average shares and equivalent shares outstanding       391.4        398.5        393.7        398.3
 Earnings per share -diluted                          $  0.11      $  0.89      $  1.30      $  1.64


</TABLE>
<PAGE>


				      -5-


                  			    SEARS, ROEBUCK AND CO.
	            NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                          				  (Unaudited)


    In each period, certain outstanding options were excluded from the
    computation of diluted earnings per share because they would have
    been antidilutive. As of October 3, 1998, options to purchase 5.8
    million and 5.7 million shares of stock at prices ranging from $50
    to $64 and $54 to $64 per share were excluded from the third quarter
    and year-to-date 1998 calculations, respectively.  As of September 27,
    1997, options to purchase 2.0 million and 2.2 million shares of stock
    at prices ranging from $58 to $64 and $53 to $64 per share were
    excluded from the third quarter and year-to-date 1997 calculations,
    respectively.
  
4.  Effect of New Accounting Standards and Statements

    Effective January 4, 1998, the Company adopted Statement of Financial
    Accounting Standards (SFAS) No. 130, "Reporting Comprehensive Income."
    This statement requires that the Company report the change in its net
    assets during the period from nonowner sources.  For the 13 and 39 weeks
    ended October 3, 1998 and the 13 weeks ended September 27, 1997,
    components of other comprehensive income (loss) include foreign
    currency translation adjustments related to Sears Canada.  For the
    39 weeks ended September 27, 1997, components of other comprehensive
    income primarily related to the foreign currency translation adjustment
    recognized on the sale of Sears Mexico.

<TABLE>
<CAPTION>
                                					  13 Weeks Ended              39 Weeks Ended
				                                  Oct. 3,      Sept. 27,      Oct. 3,       Sept. 27,
(millions)                             1998          1997          1998           1997
<S>                                     <C>           <C>          <C>            <C>
Net income                            $    44       $   353       $   513       $   652

Other comprehensive income (loss)         (22)           (1)          (35)           83

  Total comprehensive income          $    22       $   352       $   478       $   735

</TABLE>

    Effective January 4, 1998, the Company adopted AICPA Statement of
    Position (SOP) 98-1, "Accounting for the Costs of Computer Software
    Developed or Obtained for Internal Use."  SOP 98-1 requires certain
    software development costs to be capitalized.  Generally, once the
    capitalization criteria of the SOP have been met, external direct
    costs of materials and services used in development of internal-use
    software, payroll and payroll related costs for employees directly
    involved in the development of internal-use software, and interest
    costs incurred when developing software for internal use are to be
    capitalized.  The adoption of this SOP did not have a material effect
    on the Company's consolidated financial position, results of operations
    or cash flows for the 13 and 39 weeks ended October 3, 1998.

    In February 1998, the Financial Accounting Standards Board (FASB)
    issued SFAS No. 132, "Employers Disclosures about Pensions and Other
    Postretirement Benefits", which is effective for fiscal years beginning
    after December 15, 1997.  The new statement will change disclosure
    requirements related to pension and other postretirement benefit
    obligations.  The new statement will be implemented in 1998 and will
    not impact the Company's consolidated financial position, results of
    operations or cash flows.  The effect of the new statement will be
    limited to the form and content of disclosures.

    In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
    Instruments and Hedging Activities", which is required to be adopted
    in years beginning after June 15, 1999.  The Company has not yet
    determined the effect this statement will have on the consolidated
    financial position or results of operations of the Company.


<PAGE>

				      -6-


                			      SEARS, ROEBUCK AND CO.
	             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                        				  (Unaudited)


5.  Disposition of Business

    On August 16, 1998, the Company entered into an Agreement and Plan
    of Merger of Western Auto, a wholly-owned subsidiary, and Advance
    Auto Parts whereby Sears would exchange its interest in Western Auto
    for $175 million in cash and approximately 40% equity ownership
    interest in the resulting combined company.  The transaction received
    antitrust clearance in September 1998 and was consummated on November 2,
    1998.  Based upon the terms of the sale, the Company recorded a pre-tax
    charge of $296 million ($225 million after-tax) in the third quarter
    to adjust the carrying value of Western Auto's assets to their estimated
    fair market value, less cost to sell.

6.  Debt Extinguishment

    On October 2, 1998, the Company retired debt with a face value of $300
    million, which was due in May, 2000.  The transaction generated an
    extraordinary loss of $37 million and a related income tax benefit of
    $13 million, resulting in an after tax loss of $24 million.  The loss
    resulted primarily from the write-off of the related unamortized
    discount.  The debt was refinanced with the issuance of commercial
    paper.

7.  Legal Proceedings

    On June 3, 1997, the Company entered into a settlement of the
    consolidated debtor class action lawsuits filed in the United States
    Bankruptcy and District Courts for the District of Massachusetts by
    certain current and former credit card holders of the Company who had
    declared personal bankruptcy (the "Settlement").  These lawsuits alleged
    that the Company had violated the United States Bankruptcy Code and
    consumer protection laws in various states through activities related
    to certain debt reaffirmation agreements.  A federal civil and criminal
    investigation of these matters is ongoing.

    As previously reported, on May 7, 1998, the Supreme Court of the State
    of New York, County of New York, approved the settlement of consolidated
    shareholders' derivative actions filed on behalf of the Company against
    its directors and certain of its officers alleging breach of fiduciary
    duty for failing to prevent the improper handling of certain of the
    Company's debt reaffirmation agreements.  This court-approved settlement
    was subject to satisfactory resolution of several consolidated
    securities class action lawsuits against the Company and one of its
    officers in the United States District Court for the Northern District
    of Illinois.  The class action lawsuits alleged violations of the
    Securities Exchange Act of 1934 for failure to disclose the bankruptcy
    collection practices described above in periodic filings with the
    Securities and Exchange Commission prior to April 10, 1997.  On
    August 10, 1998, the Illinois court entered an order and final judgement
    approving the securities class action settlement.  The entry of this
    final judgement satisfied the condition to the court approved settlement
    of the shareholder derivative actions referred to above.

    The Company recorded a pretax charge of $475 million ($320 million on
    an after-tax basis) in the second quarter of 1997 for the estimated cost
    of the matters referred to above, including other related expenses.
    This estimate is based on management's assumptions as to the ultimate
    outcome of future events and actual results could differ from this
    estimate.  As such, it is possible that additional costs relating to
    the civil and criminal investigation referred to above could be
    incurred.  However, management believes that its current reserves
    adequately provide for the costs relating to the matters referred to
    above and does not expect  such costs to have a material effect on the
    annual results of operations, financial position, liquidity or capital
    resources of the Company.

  

<PAGE>

				      -7-


                			    SEARS, ROEBUCK AND CO.
	           NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                       				  (Unaudited)


    On July 2, 1998, a credit card holder of the Company purporting to
    represent a nationwide class filed a complaint in the United States
    District Court for the Northern District of Illinois against the
    Company and Sears National Bank ("SNB"), an indirect wholly-owned
    subsidiary of the Company, alleging breach of contract claims, state
    statutory consumer fraud and federal Truth in Lending and National
    Bank Act violations in connection with the annual percentage rate
    ("APR") charged on certain credit card balances.  Related cases have
    been filed prior to July 2, 1998 in Illinois and Washington state
    courts against the Company alleging similar claims.  The central
    allegation in each of these actions is that the May 1997 increase
    in the APR charged on balances that pre-dated the transfer of the
    cardholder accounts to SNB was unlawful.  Each of these cases seeks
    injunctive and declaratory relief, unspecified damages and attorneys'
    fees and expenses.  The Company intends to vigorously defend these
    cases.  Management does not expect this matter to have a material
    effect on the annual results of operations, financial position,
    liquidity or capital resources of the Company.

    The Company is subject to various other legal and governmental
    proceedings pending against the Company, many involving routine
    litigation incidental to the businesses.  Other matters contain
    allegations which are nonroutine and involve compensatory, punitive
    or antitrust treble damage claims in very large amounts, as well as
    other types of relief.  The consequences of these matters are not
    presently determinable but, in the opinion of management of the
    Company after consulting with legal counsel, the ultimate liability
    in excess of reserves currently recorded is not expected to have a
    material effect on annual results of operations, financial position,
    liquidity or capital resources of the Company.


<PAGE>
				      -8-


                   			    SEARS, ROEBUCK AND CO.

             		    INDEPENDENT ACCOUNTANTS' REVIEW REPORT



To the Shareholders and Board of Directors
of Sears, Roebuck and Co.

We have reviewed the accompanying Condensed Consolidated Balance Sheets
of Sears, Roebuck and Co. as of October 3, 1998 and September 27, 1997,
and the related Condensed Consolidated Statements of Income for the
13-week and 39-week periods ended October 3, 1998 and September 27, 1997,
and the Condensed Consolidated Statements of Cash Flows for the 39-week
periods ended October 3, 1998 and September 27, 1997.  These financial
statements are the responsibility of the Company's management.

We conducted our reviews in accordance with standards established by
the American Institute of Certified Public Accountants.  A review of
interim financial information consists principally of applying analytical
procedures to financial data and of making inquiries of persons responsible
for financial and accounting matters.  It is substantially less in scope
than an audit conducted in accordance with generally accepted auditing
standards, the objective of which is the expression of an opinion regarding
the financial statements taken as a whole.  Accordingly, we do not express
such an opinion.

Based on our reviews, we are not aware of any material modifications
that should be made to such condensed consolidated financial statements
for them to be in conformity with generally accepted accounting principles.

We have previously audited, in accordance with generally accepted auditing
standards, the Consolidated Balance Sheet of Sears, Roebuck and Co. as of
January 3, 1998, and the related Consolidated Statements of Income,
Shareholders' Equity, and Cash Flows for the year then ended (not presented
herein); and in our report dated February 20, 1998, we expressed an
unqualified opinion on those consolidated financial statements.  In our
opinion, the information set forth in the accompanying Condensed Consolidated
Balance Sheet as of January 3, 1998, is fairly stated, in all material
respects, in relation to the Consolidated Balance Sheet from which it has
been derived.


Deloitte & Touche LLP

Chicago, Illinois
November 5, 1998


<PAGE>

				      -9-


          		       ITEM 2 - SEARS, ROEBUCK AND CO.
		          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
		           CONDITION, RESULTS OF OPERATIONS AND LIQUIDITY
      	 13 AND 39 WEEKS ENDED OCTOBER 3, 1998 AND SEPTEMBER 27, 1997



Operating Results

Domestic operations include the Company's operations in the United States
and Puerto Rico.  Domestic operations are comprised of:

 . Retail - consisting of:                . Credit - which manages Sears Card
      - Full-line stores                            operations
      - Specialty stores (Home stores
     	  and Auto stores)

 . Services - consisting of:              . Corporate - administrative
      - Home Services                                  activities of a
      - Sears Direct (Direct Response                  holding company
       	Marketing and E-Commerce)                      nature, the cost of
						                                                 which are not
						                                                 allocated to the
						                                                 Company's businesses

International operations consist of similar retail, services and credit
operations conducted in Canada through Sears Canada, Inc. ("Sears Canada"),
a 54.7% owned consolidated subsidiary.  International operations were
also conducted through Sears, Roebuck de Mexico, S.A. de C.V. ("Sears
Mexico"), a previously 75.5% owned subsidiary until March 29, 1997.  At
that time, the Company sold 60% of the outstanding shares of Sears Mexico
to Grupo Carso S.A. de C.V.  Thereafter, Sears Mexico's results are no
longer included in the Company's consolidated operations.

For the 13 weeks ended October 3, 1998, net income was $44 million, or
$0.11 per share, as compared to $353 million, or $0.89 per share for the
13 weeks ended September 27, 1997.  The third quarter of 1998 includes an
impairment charge related to the sale of Western Auto, an extraordinary
loss on the early extinguishment of high-cost debt and the impact of
SFAS No. 125 accounting, which in aggregate reduced net income by $254
million, or $0.65 per share.  Significant non-comparable items in the
third quarter of 1997 included a charge for the cost of converting
Western Auto operations to the Parts America format, a one-time gain
for a change in current associates' postretirement life insurance
benefits, and the impact of SFAS No. 125 accounting, which in aggregate
increased net income by $52 million, or $0.13 per share.  Excluding these
non-comparable items, third quarter 1998 net income was $298 million, or
$0.76 per share, a 1.0% decrease from net income of $301 million, or $0.76
per share for the comparable 1997 period.  The slight decrease in net
income, after consideration of non-comparable items, was primarily due to
lower than expected revenue growth in the domestic retail and services
businesses coupled with a decline in credit income, substantially offset
by improvement in other income from property sales and a lower effective
tax rate.  For the 39 week period ended October 3, 1998, net income was
$513 million or $1.30 per share compared to $652 million or $1.64 per
share in 1997.  Excluding non-comparable items, net income was $728
million or $1.84 per share as compared to $791 million or $1.99 per share
in the comparable 1997 period.  The decrease is primarily due to a higher
provision for uncollectible accounts and higher levels of depreciation
expense.

The Company's consolidated effective tax rate in the third quarter of 1998
was 68.2% as compared to 39.3% in the prior year period.  The current year
tax rate was impacted by certain components of the Western Auto impairment
charge which are not tax deductible.  Excluding the impact of the impairment
charge, the Company's consolidated effective tax rate would have been 38.1%
in the third quarter of 1998.  For the 39 weeks ended October 3, 1998,
the consolidated effective tax rate was 43.7% versus 44.7% for the first
39 weeks of 1997.  The current year tax rate was impacted by the Western
Auto impairment loss.  The prior year tax rate was impacted by certain
components of the reaffirmation charge which were not tax deductible and
the tax expense from the first quarter sale of Sears Mexico.  Excluding
these significant items, the consolidated effective tax rate would have
been 38.8% for the first 39 weeks of 1998 and 39.8% for the comparable
1997 period.


<PAGE>

				   -10-


            		       ITEM 2 - SEARS, ROEBUCK AND CO.
	             MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
	               CONDITION, RESULTS OF OPERATIONS AND LIQUIDITY
       13 AND 39 WEEKS ENDED OCTOBER 3, 1998 AND SEPTEMBER 27, 1997


Due to holiday buying patterns, merchandise sales are traditionally higher
in the fourth quarter than other quarterly periods and a disproportionate
share of operating income is typically earned in the fourth quarter.  This
business seasonality results in performance for the 13 and 39 weeks ended
October 3, 1998 which is not necessarily indicative of performance for the
balance of the year.  The Company makes available by phone a recorded
message on the sales performance of its domestic stores.  The message is
updated weekly and can be heard by calling 847/286-6111.


Domestic Operations

Merchandise and services revenues increased 1.6% to $7.93 billion and 4.6%
to $23.53 billion for the 13 and 39 weeks ended October 3, 1998,
respectively, from the comparable 1997 periods.  Merchandise and services
revenues and related information are as follows:

<TABLE>
<CAPTION>

                                					      13 Weeks Ended                      39 Weeks Ended
					                                   Oct. 3,      Sept. 27,                Oct. 3,   Sept. 27,
(millions, except number of stores)      1998          1997       Change       1998       1997      Change
<S>                                      <C>           <C>         <C>         <C>         <C>       <C>
Revenues:
  Full-line stores                     $  5,170      $  5,158      0.2%      $ 15,667  $  14,973     4.6%
  Specialty stores                        1,923         1,823      5.5%         5,547      5,279     5.1%
  Total retail                            7,093         6,981      1.6%        21,214     20,252     4.8%
  Services                                  832           822      1.2%         2,311      2,235     3.4%
    Merchandise and services           $  7,925      $  7,803      1.6%      $ 23,525  $  22,487     4.6%

Number of Full-line stores                                                        838        826

Number of Specialty stores                                                      2,797      2,591

Total retail stores                                                             3,635      3,417


Comparable store sales
  Percentage increase (decrease)         (0.2)%          2.2%                    2.4%       2.4%

</TABLE>


For the 13 week period, Full-line stores revenues increased 0.2% over
the comparable 1997 period.

    . Apparel revenues declined 0.2% during the third quarter after a
      4.6% gain in 1997.  Women's special sizes and cosmetics and
      fragrances posted strong sales increases, while girl's apparel
      and home fashions had solid revenue gains.  These increases were
      offset primarily by decreases in dresses, junior's, men's, boy's
      and infant's apparel and children's hardlines.

    . Hardlines revenues comprised of home electronics, home appliances,
      and home improvement merchandise sales, as well as licensed business
      sales, increased 0.5% in the third quarter of 1998.  Gains in home
      appliances were partially offset by declines in home electronics
      and home improvement.  Home electronics sales were below the prior
      year due to slow sales of home office equipment.

For the 39 week period, Full-line stores revenues increased 4.6% over 1997
as apparel achieved a 3.0% increase and hardlines gained 5.6%.


<PAGE>
				     -11-


                  			ITEM 2 - SEARS, ROEBUCK AND CO.
	               MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
		                CONDITION, RESULTS OF OPERATIONS AND LIQUIDITY
        	 13 AND 39 WEEKS ENDED OCTOBER 3, 1998 AND SEPTEMBER 27, 1997


For the 13 week period, Specialty stores revenues increased 5.5% over the
comparable 1997 period.

    . Home stores revenues increased 15.2% over 1997 due to the addition
      of new stores and strong comparable store sales increases. Hardware
      and Sears Dealer stores had strong revenue increases from a year ago
      benefiting from 106 net new store openings.  The Commercial Sales
      business also produced strong revenue gains over the comparable 1997
      period as expansion continues.  HomeLife furniture stores revenues
      showed a moderate increase while gaining one net new store over last
      year.

    . Auto stores, consisting of the Sears Tire Group and Parts Group,
      experienced a 3.1% decline in revenue from 1997 as the Sears Tire
      Group experienced weak comparable store sales and the Parts Group
      revenue decreased primarily as a result of the change in its store
      format.  The new Parts America format sells automotive merchandise
      and no longer provides repair services.

Specialty stores revenues increased 5.1% for the 39 week period as compared
to 1997, largely due to the new store growth and increases in comparable
store sales in Hardware, HomeLife and Sears Dealer store formats.

Services revenues, which are generated by the Home Services and Sears Direct
businesses, were up 1.2% in the third quarter of 1998 and 3.4% for the first
39 weeks of 1998 versus the comparable 1997 periods.  For the third quarter
of 1998, the revenue increase by Sears Direct was partially offset by an
overall decline in the Home Services business.  For the first 39 weeks of
1998, Sears Direct posted a solid revenue increase, while Home Services
was up slightly from prior year.

Domestic credit revenues decreased 12.3% to $1.04 billion and 2.4% to $3.31
billion for the 13 and 39 weeks ended October 3, 1998, respectively, from
the comparable prior year periods.  The decline in credit revenues was
attributable to reduced late fee income and a lower level of owned credit
card receivables.  A summary of credit information (for the managed
portfolio) is as follows:

<TABLE>
<CAPTION>
                                             							  13 Weeks Ended             39 Weeks Ended
						                                                 Oct. 3,      Sept. 27,     Oct. 3,       Sept. 27,
						                                                 1998          1997         1998           1997
<S>                                                    <C>            <C>          <C>            <C>

Sears Card as a % of sales                               52.8%        56.3%         52.7%         55.8%

Average account balance
 (as of October 3, 1998 and September 27, 1997)       $  1,093     $  1,056      $  1,093      $  1,056

Average managed credit card receivables (millions)    $ 27,597     $ 27,080      $ 27,972      $ 26,871

</TABLE>


The percentage of merchandise sales and services transacted with the Sears
Card in the third quarter of 1998 declined to 52.8% compared to 56.3% a
year ago primarily due to greater preference for the use of cash, checks
and third party credit cards.

Gross margin as a percentage of domestic merchandise and services revenues
for the third quarter was 25.8% versus 25.7% in the comparable prior year
period.  Excluding the charge for Parts America format conversions in the
prior year, margin rate was flat with last year.  During the third quarter
of 1998, increased promotional markdowns were offset by improved physical
inventory results.  For the 39 week period, 1998 domestic gross margin
declined 30 basis points to 25.4%.



<PAGE>


				     -12-


                    		       ITEM 2 - SEARS, ROEBUCK AND CO.
	                  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
		                  CONDITION, RESULTS OF OPERATIONS AND LIQUIDITY
	            13 AND 39 WEEKS ENDED OCTOBER 3, 1998 AND SEPTEMBER 27, 1997


Selling and administrative expense as a percentage of total revenues for
domestic operations was 20.8% in the third quarter of 1998 versus 20.0%
in the comparable prior year period.  The prior year was favorably impacted
by a change in current associates' postretirement life insurance benefits
and the impact of securitization accounting, partially offset by the charge
for converting Western Auto to the Parts America format.  Excluding these
non-comparable items, selling and administrative expense as a percentage
of revenue increased 10 basis points.  The increase was primarily due to
higher expenses within the credit and services businesses, partially offset
by improvement in retail expense leverage.  For the 39 week period, the
selling and administrative expense rate for domestic operations improved
10 basis points to 20.5%.  Excluding non-comparable items, the domestic
selling and administrative rate for the 39 week period improved 50 basis
points to 20.4%.

The domestic provision for uncollectible accounts and related information
is as follows:

<TABLE>
<CAPTION>
	                    						                            13 Weeks Ended            39 Weeks Ended
						                                                	Oct. 3,      Sept. 27,    Oct. 3,     Sept. 27,
(millions)                                               1998          1997        1998         1997
<S>                                                      <C>           <C>          <C>         <C>
Provision for uncollectible accounts                    $   281      $   348      $ 1,016     $   870

Net credit charge-offs as a percentage of
 average managed credit card receivables                  7.20%        6.87%        7.56%       5.84%

Allowance for uncollectible credit card receivables     $ 1,081      $   833      $ 1,081     $   833

Delinquency rates for managed portfolio
 (as of October 3, 1998 and September 27, 1997)           6.82%        6.85%        6.82%       6.85%

</TABLE>

The provision for uncollectible accounts decreased 19.2% to $281 million
for the 13 weeks ended October 3, 1998, from the same period last year.
The decrease was primarily attributable to favorable trends in delinquency
rates, charge-off experience and bankruptcy filings, as well as lower owned
credit card receivable balances.  The allowance for uncollectible credit
card receivables decreased $20 million during the third quarter of 1998.
For the 39 weeks ended October 3, 1998, the provision for uncollectible
accounts increased 16.8% to $1.02 billion.

Domestic operations depreciation and amortization expense was $187 million
in the third quarter and $575 million for the first 39 weeks of 1998, an
increase of $10 million and $46 million, respectively, from the comparable
1997 periods.  The increase reflects the continuation of the Full-line
stores remodeling program and the growth in the number of Full-line and
Specialty stores in operation.

Domestic operations interest expense, as presented on the statements of
income, is combined with the funding costs on receivables sold through
securitizations to represent total funding costs as follows:

<TABLE>
<CAPTION>

                                      						       13 Weeks Ended              39 Weeks Ended
					                                           	Oct. 3,     Sept. 27,      Oct. 3,     Sept. 27,
(millions)                                       1998         1997          1998         1997
<S>                                              <C>          <C>            <C>         <C>
Interest expense                                $   316     $   304        $   999     $   930

Funding cost on securitized receivables (1)         110         102            323         315

Total funding costs                             $   426     $   406        $ 1,322     $ 1,245


<FN>
(1) Funding cost on securitized receivables represents the interest paid
    on securitized receivables.
</FN>
</TABLE>

<PAGE>


				     -13-


                      			ITEM 2 - SEARS, ROEBUCK AND CO.
	                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
	                  	CONDITION, RESULTS OF OPERATIONS AND LIQUIDITY
	          13 AND 39 WEEKS ENDED OCTOBER 3, 1998 AND SEPTEMBER 27, 1997


Total domestic funding costs increased in the third quarter of 1998 compared
to the third quarter of 1997 and increased for the first 39 weeks of 1998
compared to the first 39 weeks of 1997.  Funding costs increased due to the
additional level of debt needed to support a larger managed credit card
receivables portfolio, higher inventory levels, capital spending and the
share repurchases made during the third quarter of 1998.  The interest
expense from the higher debt levels was partially offset by lower effective
funding rates.

Domestic operating income in the third quarter of 1998 was $148 million
compared to $568 million in the comparable 1997 period.  Excluding
non-comparable items, operating income was $452 million, a 6.4% decrease
from operating income of $483 million in the third quarter of 1997.

Domestic operating income by format, excluding non-comparable items,
is as follows:

<TABLE>
<CAPTION>

                                  					       13 Weeks Ended             39 Weeks Ended
					                                      Oct. 3,     Sept. 27,      Oct. 3,     Sept. 27,
(millions)                                   1998         1997          1998         1997
<S>                                           <C>          <C>           <C>         <C>
Retail                                      $    89     $    93        $   228     $   239

Services                                        107         120            284         276

Credit                                          299         315            774         931

Corporate                                       (43)        (45)          (156)       (155)

 Domestic operating income excluding
 non-comparable items                           452         483          1,130       1,291

 Non-comparable items                          (304)         85           (241)       (269)

 Total domestic operating income            $   148     $   568        $   889     $ 1,022

</TABLE>

International Operations

International revenues for the third quarter of 1998 decreased 1.1% from
the same period a year ago.  Sears Canada enjoyed strong retail and catalog
sales performance, but the negative effects of a lower exchange rate offset
the increase when reporting in U.S. dollars.  For the first 39 weeks of
1998, International revenues were $2.33 billion, which is slightly below
the prior year.  The prior year includes revenues of $100 million generated
by Sears Mexico before its sale in the first quarter of 1997.  During the
first 39 weeks of 1998, Sears Canada revenues increased 4.0% despite the
negative impact of the exchange rate.

Gross margin as a percentage of merchandise and services revenues decreased
to 25.9% in the third quarter from 26.4% in 1997, reflecting higher retail
promotional markdowns compared to the prior year.  For the first 39 weeks
of 1998, gross margin rate declined 40 basis points to 25.2%.

Selling and administrative expense as a percentage of total revenues
decreased to 22.0% in 1998 from 23.2% in the third quarter of 1997.  The
improvement was primarily due to leveraging employee-related costs and
marketing expense.  For the first 39 weeks of 1998, the selling and
administrative expense rate improved 130 basis points to 21.8%.


<PAGE>

				     -14-


                   			 ITEM 2 - SEARS, ROEBUCK AND CO.
	            	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
		              CONDITION, RESULTS OF OPERATIONS AND LIQUIDITY
	           13 AND 39 WEEKS ENDED OCTOBER 3, 1998 AND SEPTEMBER 27, 1997



Financial Condition

The consolidated owned net credit card receivables balances of $16.79
billion, $18.31 billion and $19.84 billion as of October 3, 1998,
September 27, 1997 and January 3, 1998, respectively, exclude credit card
receivables transferred to a securitization Master Trust as follows:

<TABLE>
<CAPTION>

(millions)                                        Oct. 3,      Sept. 27,    Jan. 3,
                                          						   1998          1997        1998
<S>                                                <C>           <C>          <C>

Domestic

  Managed credit card receivables                 $ 27,440     $ 27,337     $ 28,945

  Securitized balances sold                         (6,478)      (6,520)      (6,404)

  Retained interest in transferred credit
   card receivables                                 (4,577)      (3,212)      (3,316)

  Other customer receivables                           220          171          161

Domestic owned credit card receivables              16,605       17,776       19,386

International credit card receivables                1,303        1,397        1,570

Consolidated credit card receivables              $ 17,908     $ 19,173     $ 20,956

    Less: Allowance for uncollectible accounts       1,116          866        1,113

    Credit card receivables, net                  $ 16,792     $ 18,307     $ 19,843


</TABLE>

Consolidated credit card receivables (before allowance for uncollectible
accounts) decreased $1.27 billion when comparing the third quarter of
1998 with the third quarter of 1997.  The decrease is primarily due to
accounts being transferred to the securitization Master Trust to be used
in future securitizations.  Managed credit card receivables increased over
third quarter 1997 primarily due to growth in existing account balances.
Compared to 1997 year-end, consolidated credit card receivables (before
allowance for uncollectible accounts) decreased $3.05 billion due to the
normal seasonal nature of the retail industry as well as the aforementioned
transfer of receivables to the securitization Master Trust.

As of October 3, 1998, consolidated merchandise inventories on the
first-in, first-out (FIFO) basis were $6.61 billion, compared with $6.43
billion at September 27, 1997 and $5.76 billion at January 3, 1998.  The
increase in the inventory levels reflects the additional inventory to
support higher sales volume and the addition of new Full-line and Specialty
stores.  Domestic inventories per selling square foot declined slightly from
prior year levels.

Total property and equipment, net of accumulated depreciation, was $6.49
billion at October 3, 1998 compared with $6.06 billion a year earlier.
The increase is primarily due to the net addition of 12 Full-line stores
and 206 Specialty stores, as well as the continuation of the Full-line
stores remodeling program.



<PAGE>

				     -15-


                   			ITEM 2 - SEARS, ROEBUCK AND CO.
	             MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
	               CONDITION, RESULTS OF OPERATIONS AND LIQUIDITY
	        13 AND 39 WEEKS ENDED OCTOBER 3, 1998 AND SEPTEMBER 27, 1997
 


Total funding for the Company at October 3, 1998 was $27.1 billion compared
with $25.5 billion a year earlier.  The increase in funding was used
primarily to support growth in inventory and the managed credit card
receivables portfolio as well as to provide cash for the capital spending
program and share repurchases made during the third quarter.  Total funding
includes debt recorded on the balance sheet and investor certificates
related to credit card receivables sold through securitizations as follows:

<TABLE>
<CAPTION>


(millions)                                          Oct. 3,       Sept. 27,    Jan. 3,
                                          						     1998           1997        1998
<S>                                                   <C>            <C>         <C>

Short-term borrowings                               $  5,439      $  3,987     $  5,208
Long-term debt and capitalized lease obligations      15,165        14,951       15,632
Securitized balances sold                              6,478         6,520        6,404
  Total funding                                     $ 27,082      $ 25,458     $ 27,244

</TABLE>

As of October 3, 1998, the Company has increased both long-term debt and
short-term borrowings in its funding mix compared to the September 27,
1997 levels.  The Company accesses a variety of capital markets to preserve
flexibility and diversify its funding sources.  The primary funding sources
utilized include medium term notes, securitization, senior unsecured debt
and unsecured commercial paper.

Liquidity

Based upon the cash flow expected to be generated from future operations
and the Company's ability to cost-effectively access multiple sources of
funding, the Company believes sufficient resources will be available to
maintain its planned level of operations, capital expenditures and dividends
in the future.

Year 2000

The Company has implemented a comprehensive risk-based plan designed to
make its operations Year 2000 compliant.  The Company has established a
corporate project office, which reports to an executive management team,
to oversee, monitor and coordinate the Company-wide Year 2000 effort.
The Company's plan focuses on three areas - information systems, business
management and vendor relations - and generally covers four stages,
including (i) inventory, (ii) assessment, (iii) remediation and
(iv) testing and certification.  The remediation and testing and
certification stages do not apply to the vendor relations area.  The
Company is utilizing both internal and external resources to complete
its Year 2000 initiatives.

The information systems area includes the Company's proprietary and third
party computer systems and related hardware, software and data and telephone
networks.  The Company's computer, data and voice infrastructure, which
supports merchandise procurement and distribution, inventory control and
point-of-sale information systems, is primarily serviced by a third party.
With respect to the Company's credit business, the Company is in the
process of converting to a third party account processing system and has
obtained assurances from such third party that it expects its system to be
Year 2000 compliant.  Approximately 50% of the Company's information
systems are presently Year 2000 compliant.  Remediation of the majority
of the Company's remaining systems is in process, with substantial
completion anticipated by mid-1999.  The testing and certification stage
for these areas is targeted to be largely completed by mid-1999.
 
The business management area includes equipment and systems that contain
embedded computer technology such as elevators and security systems.
The Company's assessment of these systems is nearing completion.  Based
on assurances from third parties, these systems present little Year 2000
exposure or risk.


<PAGE>

				     -16-


             		       ITEM 2 - SEARS, ROEBUCK AND CO.
		             MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
		               CONDITION, RESULTS OF OPERATIONS AND LIQUIDITY
	         13 AND 39 WEEKS ENDED OCTOBER 3, 1998 AND SEPTEMBER 27, 1997


The Company has surveyed its "mission critical" merchandise and service
provider vendors to determine their Year 2000 status and has either
obtained or is negotiating to obtain appropriate assurances from these
vendors.  In addition, the Company is conducting on-site assessments of
certain of its mission-critical vendors to further assess such vendors'
progress.

The Company is developing contingency plans, such as alternative sourcing,
and identifying what actions would need to be taken if a critical system
or service provider were not Year 2000 compliant.  The Company expects
these plans to be finalized by mid-1999.

Despite the Company's significant efforts to make its systems and
facilities Year 2000 compliant, the ability of third party service
providers, vendors and certain other third parties, including governmental
entities and utility companies to be Year 2000 compliant, is beyond the
Company's control.  Accordingly, the Company can give no assurances that
the systems of other companies on which the Company's systems rely will
be timely converted or compatible with the Company's systems.  The failure
of these entities to comply on a timely basis could have a material adverse
effect on the Company.  At the present time, the Company does not expect
Year 2000 issues to materially affect its products, services, competitive
position or financial performance.
  
Total costs related to the Year 2000 effort are estimated to be
approximately $63 million, of which approximately $26 million have been
incurred by the Company (including Sears Canada) through October 3, 1998.
In addition, the Company has accelerated the planned development of new
systems with improved business functionality to replace systems that were
not Year 2000 compliant.  The cost for these systems will approximate $80
million, of which approximately $41 million has been incurred.  The
Company's Year 2000 costs have been and are expected to be funded with
cash flows from operations.

The foregoing statements as to costs and dates relating to the Year 2000
effort are forward looking and are made in reliance on the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.  They
are based on the Company's best estimates which may be updated as
additional information becomes available.  The Company's forward looking
statements are also based on assumptions about many important factors,
including the technical skills of employees and independent contractors,
the representations and preparedness of third parties, the failure of
vendors to deliver merchandise or perform services required by the Company
and the collateral effects of the Year 2000 issues on the Company's
business partners and customers.  While the Company believes its
assumptions are reasonable, it cautions that it is impossible to predict
the impact of certain factors that could cause actual costs or timetables
to differ materially from the expected results.


<PAGE>

				     -17-


			  PART II.  OTHER INFORMATION


Item 1. Legal Proceedings

	On June 3, 1997, the Company entered into a settlement of the
	consolidated debtor class action lawsuits filed in the United
	States Bankruptcy and District Courts for the District of
	Massachusetts by certain current and former credit card holders
	of the Company who had declared personal bankruptcy (the
	"Settlement").  These lawsuits alleged that the Company had
	violated the United States Bankruptcy Code and consumer protection
	laws in various states through activities related to certain debt
	reaffirmation agreements.  A federal civil and criminal
	investigation of these matters is ongoing.

	As previously reported, on May 7, 1998, the Supreme Court of the
	State of New York, County of New York, approved the settlement of
	consolidated shareholders' derivative actions filed on behalf of
	the Company against its directors and certain of its officers
	alleging breach of fiduciary duty for failing to prevent the
	improper handling of certain of the Company's debt reaffirmation
	agreements.  This court-approved settlement was subject to
	satisfactory resolution of several consolidated securities class
	action lawsuits against the Company and one of its officers in the
	United States District Court for the Northern District of Illinois.
	The class action lawsuits alleged violations of the Securities
	Exchange Act of 1934 for failure to disclose the bankruptcy
	collection practices described above in periodic filings with the
	Securities and Exchange Commission prior to April 10, 1997.  On
	August 10, 1998, the Illinois court entered an order and final
	judgement approving the securities class action settlement.  The
	entry of this final judgement satisfied the condition to the court
	approved settlement of the shareholder derivative actions referred
	to above.

	The Company recorded a pretax charge of $475 million ($320 million
	on an after-tax basis) in the second quarter of 1997 for the
	estimated cost of the matters referred to above, including other
	related expenses.  This estimate is based on management's assumptions
	as to the ultimate outcome of future events and actual results could
	differ from this estimate.  As such, it is possible that additional
	costs relating to the civil and criminal investigation referred to
	above could be incurred.  However, management believes that its
	current reserves adequately provide for the costs relating to the
	matters referred to above and does not expect such costs to have a
	material effect on the annual results of operations, financial
	position, liquidity or capital resources of the Company.

	On July 2, 1998, a credit card holder of the Company purporting to
	represent a nationwide class filed a complaint in the United States
	District Court for the Northern District of Illinois against the
	Company and Sears National Bank ("SNB"), an indirect wholly-owned
	subsidiary of the Company, alleging breach of contract claims, state
	statutory consumer fraud and federal Truth in Lending and National
	Bank Act violations in connection with the annual percentage rate
	("APR") charged on certain credit card balances.  Related cases have
	been filed prior to July 2, 1998 in Illinois and Washington state
	courts against the Company alleging similar claims.  The central
	allegation in each of these actions is that the May 1997 increase
	in the APR charged on balances that pre-dated the transfer of the
	cardholder accounts to SNB was unlawful.  Each of these cases seeks
	injunctive and declaratory relief, unspecified damages and attorneys'
	fees and expenses.  The Company intends to vigorously defend these
	cases. Management does not expect this matter to have a material
	effect on the annual results of operations, financial position,
	liquidity or capital resources of the Company.

	The Company is subject to various other legal and governmental
	proceedings pending against the Company, many involving routine
	litigation incidental to the businesses.  Other matters contain
	allegations which are nonroutine and involve compensatory, punitive
	or antitrust treble damage claims in very large amounts, as well
	as other types of relief.  The consequences of these matters are
	not presently determinable but, in the opinion of management of
	the Company after consulting with legal counsel, the ultimate
	liability in excess of reserves currently recorded is not expected
	to have a material effect on annual results of operations,
	financial position, liquidity or capital resources of the Company.




<PAGE>

				     -18-


                   			  PART II.  OTHER INFORMATION


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

	(a)     Exhibits.

		An Exhibit Index has been filed as part of this Report on
		Page E-1.

	(b)     Reports on Form 8-K.

		None.



<PAGE>
				     -19-


                           				   SIGNATURE

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


                            				       Sears, Roebuck and Co.
					                                        (Registrant)



November 6, 1998                       By /s/ Jeffrey N. Boyer
                                  					Jeffrey N. Boyer
				                                  	Vice President and Controller

                                  					(Principal Accounting
					                                   Officer and duly authorized
                                  					 officer of Registrant)



<PAGE>


				      E-1

                        				 EXHIBIT INDEX
			                      SEARS, ROEBUCK AND CO.
		                 13 AND 39 WEEKS ENDED OCTOBER 3, 1998


Exhibit No.

  3(a).   Restated Certificate of Incorporation as in effect on May 13,
	  1996 (incorporated by reference to Exhibit 3(a) to Registrant's
	  Statement No. 333-8141).

  3(b).   By-laws, as amended to August 12, 1998, filed herewith.

     4.   Registrant hereby agrees to furnish the Commission, upon request,
	  with the instruments defining the rights of holders of each issue
	  of long-term debt of the Registrant and its consolidated
	  subsidiaries.

 12(a).   Computation of ratio of income to fixed charges for Sears, 
	  Roebuck and Co. and consolidated subsidiaries for each of the
	  five years ended January 3, 1998 and for the nine- and twelve-month
	  periods ended October 3, 1998.

 12(b).   Computation of ratio of income to combined fixed charges and
	  preferred share dividends for Sears, Roebuck and Co. and
	  consolidated subsidiaries for each of the four years: 1996, 1995,
	  1994, and 1993.

    15.   Acknowledgement of awareness from Deloitte & Touche LLP, dated
	  November 5, 1998, concerning unaudited interim financial
	  information.

    27.   Financial Data Schedule.