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                                                                         1996
                      SECURITIES AND EXCHANGE COMMISSION
                           WASHINGTON, D. C.  20549

                                 F O R M  10-K
(Mark One)
/X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996

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

                        COMMISSION FILE NUMBER 1-1941

            B E T H L E H E M   S T E E L   C O R P O R A T I O N
            (Exact name of registrant as specified in its charter)

              DELAWARE                        24-0526133
      (State of Incorporation)   (I.R.S. Employer Identification No.)

          1170 EIGHTH AVENUE
       BETHLEHEM, PENNSYLVANIA                   18016-7699
(Address of principal executive offices)         (Zip Code)

     REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:  (610) 694-2424

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

                                              Name of each exchange on
    Title of each class                          which registered
    -------------------                       ------------------------
Common Stock--$1 par value per share          New York Stock Exchange
                                              Chicago Stock Exchange
Preference Stock Purchase Rights              New York Stock Exchange
                                              Chicago Stock Exchange
Preferred Stock -- $1 par value per share
  $5.00 Cumulative Convertible                New York Stock Exchange
  (stated value $50.00 per share)
  $2.50 Cumulative Convertible                New York Stock Exchange
  (stated value $25.00 per share)
6-7/8% Debentures.  Due March 1, 1999         New York Stock Exchange
8-3/8% Debentures.  Due March 1, 2001         New York Stock Exchange
8.45% Debentures.  Due March 1, 2005          New York Stock Exchange

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
                                 None
                           (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.    /X/


Aggregate Market Value of Voting Stock held by Non-Affiliates:  919,398,299
    The amount shown is based on the closing price of Bethlehem Common Stock on
the New York Stock Exchange Composite Tape on March 21, 1996.  Voting stock
held by directors and executive officers of Bethlehem is not included in the
computation.  However, Bethlehem has made no determination that such
individuals are "affiliates" within the meaning of Rule 405 under the
Securities Act of 1933.

Number of Shares of Common Stock outstanding as of March 21, 1997: 112,061,570

DOCUMENTS INCORPORATED BY REFERENCE:

    Selected portions of the 1996 Annual Report to Stockholders of Bethlehem
Steel Corporation are incorporated by reference into Part II of this Report on
Form 10-K.

    Selected portions of the 1997 Proxy Statement of Bethlehem Steel
Corporation are incorporated by reference into Part III of this Report on
Form 10-K.


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                                  PART I
ITEM 1.   BUSINESS.

    Bethlehem(1) is the second largest steel producer in the United States and
primarily manufactures and sells a wide variety of steel mill products.
Bethlehem also produces and sells coke, coal and iron ore.

    For financial reporting purposes, Bethlehem reports the results of its
operations and other financial information in two segments, Basic Steel
Operations and Steel Related Operations.  Note B to the Consolidated Financial
Statements contains financial information relating to Bethlehem's industry
segments for 1996, 1995 and 1994.  The table below shows the percentage
contribution to Bethlehem's net sales of each segment and of major classes of
products for each of the years 1994 through 1996:


                                                1996    1995    1994
                                                ----    ----    ----
BASIC STEEL OPERATIONS
  Steel mill products:
     Hot rolled sheets . . . . . . . . . .      14.7%   15.9%   16.6%
     Cold rolled sheets. . . . . . . . . .      16.0    14.4    17.0
     Coated sheets . . . . . . . . . . . .      32.0    29.7    25.9
     Tin mill products . . . . . . . . . .       7.0     6.1     6.6
     Plates. . . . . . . . . . . . . . . .      15.3    15.1    14.0
     Structural shapes and piling. . . . .       3.8     6.7     6.7
     Rail products . . . . . . . . . . . .       3.5     3.2     2.8
     Other steel mill products . . . . . .       1.6     2.7     2.5
  Other products and services
    (including raw materials).                   3.6     4.2     5.5
                                               ------  ------  ------
                                                97.5    98.0    97.6
STEEL RELATED OPERATIONS . . . . . . . .         2.5     2.0     2.4
                                               ------  ------  ------
                                               100.0%  100.0%  100.0%
                                               ======  ======  ======

BASIC STEEL OPERATIONS

OPERATIONS

    Bethlehem's Basic Steel Operations produces a wide variety of steel mill
products, including hot rolled, cold rolled and coated sheets and strip,
plates, tin mill products, specialty blooms, carbon and alloy bars, rail and
large-diameter pipe.  Basic Steel Operations includes the following Business
Units:  the Burns Harbor Division, the Sparrows Point Division and Pennsylvania
Steel Technologies, Inc.  Basic Steel Operations also includes Bethlehem
Structural Products Corporation which produced structural shapes and special
sections.  See "ITEM 1.  BUSINESS--Restructuring Activities" of this Report for
a discussion of Bethlehem Structural Products Corporation.  Also included in
Basic Steel Operations are iron ore and coal operations (which provide raw
materials to Bethlehem's steelmaking facilities or sell such materials to trade
customers), railroad and trucking operations (which primarily transport raw
materials and semifinished steel products within various Bethlehem operations)
and lake shipping operations (which primarily transport raw materials to the
Burns Harbor Division).  See "ITEM 2.  PROPERTIES" of this Report for a
description of the facilities of these business units and operations.

    As reported by the American Iron and Steel Institute ("AISI"), the domestic
steel industry's raw steel production capability for 1996 was 116 million tons,
and the preliminary average rate of industry utilization of that capability was
90 percent, compared with 112 million tons and 93 percent for 1995 and 108
million tons and 93 percent for 1994.  Bethlehem's raw steel production
capability was 10.5 million tons for 1996 compared with 11.5 million tons for
1995 and 1994.  Its average rate of utilization of that capability was 90
percent for 1996, 91 percent for 1995 and 85 percent for 1994.

----------
(1) "Bethlehem" when used in this Report means Bethlehem Steel Corporation, a
    Delaware corporation, and where applicable includes its consolidated
    subsidiaries.  Bethlehem was incorporated in Delaware in 1919.

                                 - 1 -

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    The following table shows, for each of the years indicated, the raw steel
production of Bethlehem and of the entire domestic steel industry:

                                               Raw Steel Production
                                    ------------------------------------------
                                                    Domestic    Bethlehem as a
                                                     Steel      % of Domestic
                                    Bethlehem       Industry*   Steel Industry
                                    ---------       ---------   --------------
                                    (millions of net tons)
     1996. . . . . . . . . . . . .     9.4            104.4**        9.1**
     1995. . . . . . . . . . . . .    10.4            104.9         10.0
     1994. . . . . . . . . . . . .     9.8            100.6          9.7

-----------------
 * The figures are as reported by the AISI.
** Based on preliminary AISI figures.

    Of Bethlehem's 1996 raw steel production, 92 percent was produced by basic
oxygen furnaces and 8 percent by electric furnaces.  Bethlehem's three
continuous slab casters for light flat rolled products and plates produced
about 81 percent of the slabs needed for these products in 1996 compared with
84 percent in 1995 and 78 percent in 1994.

    Bethlehem's operations are subject to planned and unplanned outages due to
required maintenance, equipment malfunctions, work stoppages, various hazards
(including explosions, fires and severe weather conditions) and the
availability of raw materials, supplies, utilities and other items needed for
the production of steel.  These outages could result in reduced production and
increased costs.


MARKETS

    The following table shows, for each of the years indicated, the percentage
of the total net tons of steel mill products shipped by Bethlehem's Basic Steel
Operations to each of its principal markets, including shipments to its own
manufacturing operations:

                                              1996        1995        1994
                                              ----        ----        ----
 Service Centers, Distributors, Processors
   and Converters (including semifinished     45.2%       41.0%       45.9%
   customers)
 Transportation (including automotive) .      26.0        24.8        24.2
 Construction. . . . . . . . . . . . . .      12.6        14.2        14.7
 Containers. . . . . . . . . . . . . . .       5.2         5.2         5.7
 Machinery . . . . . . . . . . . . . . .       5.1         5.2         4.9
 Other . . . . . . . . . . . . . . . . .       5.9         9.6         4.6
                                             ------      ------      ------
                                             100.0%      100.0%      100.0%
                                             ======      ======      ======

    Many of the markets Bethlehem supplies, such as automotive, machinery and
construction, are highly cyclical and subject to downturns in the U.S.
economy.  Also, many of Bethlehem's customers and suppliers are subject to
collective bargaining agreements and their ability to operate could be impacted
by a strike or work stoppage.

    Bethlehem distributes steel products principally through its own sales
organization, which has sales offices at various locations in the United States
and Mexico, and through foreign sales agents.  In addition to selling to
customers who consume steel products directly, Bethlehem sells steel products
to steel service centers, distributors, processors and converters.  Export
sales for this segment were 3 percent of total sales in 1996, 5 percent in 1995
and 2 percent in 1994.

    Trade orders on hand for Basic Steel Operations at December 31, 1996 and
1995 were about $1.2 billion and $1.3 billion, respectively.  Substantially all
of the orders on hand at December 31, 1996, are expected to be filled in 1997.

                                  - 2 -

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STEEL PRICE SENSITIVITY

    Bethlehem's results are significantly affected by relatively small (on a
percentage basis) variations in the realized prices for its products.
Bethlehem shipped 8.8 million net tons of steel products and recorded sales of
$4.7 billion during 1996, implying an average realized price per ton of about
$530.  A one percent increase or decrease in this implied average realized
price during 1996 could, on a pro forma basis, have resulted in an increase or
decrease in net sales and pre-tax income of about $47 million.  Competitive
pressures in the steel industry are severe.  These pressures could limit
Bethlehem's ability to obtain price increases or could lead to a decline in
prices, which could have a material adverse effect upon Bethlehem.


CYCLICALITY

    The domestic steel industry is highly cyclical in nature.  Domestic
integrated producers suffered substantial losses in the first half of the
1980s.  During the second half of the 1980s, domestic steel producers benefited
from improved industry conditions and in 1988 domestic industry earnings
reached record levels.  Steel demand and pricing declined between 1989 and 1992
and the domestic industry reported substantial losses.  Since 1993, there has
been a recovery in steel markets and domestic steel producers have reported
improved results.  Although Bethlehem believes that domestic steel markets will
be relatively good in 1997, there can be no assurance as to the extent of any
future improvement in domestic industry earnings.


COMPETITION

    The domestic steel industry is highly competitive.  This competition
affects the prices that Bethlehem can charge for its products, the utilization
of its production facilities, its ability to sell higher value products and
ultimately the profitability of Bethlehem.

    CAPICITY.  There is excess world capacity for many of the products produced
by Basic Steel Operations.  Many foreign steel producers are owned, controlled
or subsidized by their governments.  Decisions by these foreign producers to
continue marginal facilities may be influenced to a greater degree by political
and economic policy considerations than by prevailing market conditions.
Overcapacity has also been perpetuated by the continued operation,
modernization and upgrading of marginal domestic facilities through bankruptcy
reorganization proceedings and by the sale by integrated producers of marginal
domestic facilities to new owners, which operate such facilities with a lower
cost structure.  Over the next several years, construction of additional flat
rolled production facilities could result in increased domestic capability of
up to 10 million tons over 1996 levels.

    MINI-MILLS.  Domestic integrated producers, such as Bethlehem, have lost
market share in recent years to domestic mini-mills.  Mini-mills provide
significant competition in certain product lines, including hot rolled sheet
products.  Mini-mills, which are less expensive to build than integrated
facilities, are relatively efficient, low-cost producers that produce steel
from scrap in electric furnaces, have low employment and environmental costs
and target regional markets.  Through the use of iron substitutes and thin slab
casting technology, mini-mill competitors are increasingly able to compete
directly with producers of higher value products, including cold rolled and
coated sheets.  Most of the previously mentioned new flat rolled facilities
that will be constructed over the next several years will be mini-mills.

    IMPORTS.  Domestic steel producers also face significant competition from
foreign producers and have been adversely affected by unfairly traded imports.
In many cases, foreign producers are pricing their products below their
production costs.  Imports of finished steel products accounted for about 18
percent of the domestic market in 1996 and 1995 and 20 percent in 1994.

                                - 3 -

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<PAGE> 5

    The following table, which is based on data reported by the AISI, shows the
percentage of the domestic apparent consumption of steel mill products supplied
by imports for various classes of products.

                                                1996*   1995    1994
                                                -----   ----    ----
Structural shapes and piling.  .  .  .  .  .     16%     11%     13%
Bars, rods, tool steel and semifinished .  .     36      31      35
Plates .  .  .  .  .  .  .  .  .  .  .  .  .     26      22      23
Sheets, strip and tin mill products  .  .  .     16      16      19
Rail.  .  .  .  .  .  .  .  .  .  .  .  .  .     26      28      30
All products**  .  .  .  .  .  .  .  .  .  .     23      21      25

----------
* Preliminary
** Excludes steel imported in the form of manufactured goods, such as
   automobiles, but includes semifinished steel.

    Excluding semifinished steel, imports of steel mill products were about
21.6 million tons in 1996, 19.2 million tons in 1995 and 22.1 million tons in
1994.

    Antidumping and countervailing duty orders covering imports of corrosion
resistant sheet from 6 countries, cold rolled sheet from 3 countries and plates
from 11 countries, which resulted from unfair trade cases filed by Bethlehem
and 11 other companies in 1992, remain in place.  Imports of flat rolled steel
from countries not subject to orders, including particularly the Commonwealth
of Independent States (formerly the USSR), eastern European countries and the
People's Republic of China, have increased significantly.  New antidumping
investigations are currently pending with respect to imports of cut-to-length
plate from the People's Republic of China, Russia, the Ukraine and South
Africa.

    The major restructuring of the domestic steel industry, which began in the
late 1970s and early 1980s, has removed the steelmaking capacity that once
existed to meet market demand during peak periods.  During the last few years,
domestic producers have met a portion of the demand that exceeded steelmaking
capacity by importing semifinished slabs for rolling into finished products in
their own mills.  Increased imports of finished products met the remaining
demand, which could not be met by domestic rolling mills.

    SUBSTITUTE MATERIALS.  For many steel products, there is substantial
competition from manufacturers of products other than steel, including
plastics, aluminum, ceramics, glass, wood and concrete.  Changes to the
relative competitiveness of these substitute materials and the emergence of
additional substitute materials could adversely affect future prices and demand
for Bethlehem's products.


STEEL RELATED OPERATIONS

    Bethlehem's Steel Related Operations includes BethForge, Inc.  and CENTEC
Roll Corporation.  BethForge manufactures and fabricates forged products,
including forged rolls for the metalworking industry.  CENTEC produces
centrifugally cast rolls for the metalworking industry.  The operations of
BethForge and CENTEC are located in Bethlehem, Pennsylvania.

    Steel Related Operations also includes BethShip, Inc., which repairs and
services ships and fabricates industrial products.  The facilities of BethShip
consist of a ship repair yard at Sparrows Point, Maryland.

    Trade orders on hand for Bethlehem's Steel Related Operations at December
31, 1996 and 1995, were about $59 million and $43 million,
respectively.  Substantially all the orders on hand at December 31, 1996, are
expected to be filled in 1997.

    See "ITEM 1.  BUSINESS--Restructuring Activities" of this Report for a
discussion of the status of Bethlehem's Steel Related Operations.

                               - 4 -
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GENERAL

CAPITAL EXPENDITURES

    Capital expenditures were $259 million in 1996 compared with $267 million
in 1995 and $445 million in 1994.  Capital expenditures for 1997 are currently
estimated to be about $280 million.

    Major projects during 1996 included the upgrade of the 160-inch plate mill
and the modernization of the hot strip mill at the Burns Harbor Division.

    About $280 million of additional capital expenditures were authorized in
1996.  At December 31, 1996, the estimated cost of completing authorized
capital expenditures was about $386 million compared with $400 million at
December 31, 1995.  Such authorized capital expenditures are expected to be
completed during the 1997-1999 period.

    The domestic integrated steel industry is very capital intensive.  As
discussed under "ITEM 2.  PROPERTIES--General" of this Report, Bethlehem's
principal operations and facilities are of varying ages, technologies and
operating efficiencies.  Bethlehem will need to continue to make significant
capital expenditures in the future to improve and maintain the competitiveness
of its operations and facilities.


ENVIRONMENTAL CONTROL AND REMEDIATION EXPENDITURES

    Bethlehem is subject to various federal, state and local environmental laws
and regulations concerning, among other things, air emissions, waste water
discharges and solid and hazardous waste disposal.  During the five years ended
December 31, 1996, Bethlehem spent about $160 million for environmental control
equipment.  Expenditures for new environmental control equipment totaled about
$29 million in 1996, $36 million in 1995 and $44 million in 1994.  The costs
incurred in 1996 to operate and maintain existing environmental control
equipment were about $115 million (excluding interest costs but including
depreciation charges of $19 million) compared with $120 million in 1995 and
$115 million in 1994.  In addition, Bethlehem has been required to pay various
fines and penalties relating to violations or alleged violations of laws and
regulations in the environmental control area.  Bethlehem paid about $160,000
in 1996, $5.9 million in 1995 and $3.9 million in 1994 for such fines and
penalties.

    Under the Clean Air Act, as amended, coke-making facilities will have to
meet progressively more stringent standards over the next 25 years.  Bethlehem
currently operates coke-making facilities in Bethlehem, Pennsylvania; Burns
Harbor, Indiana; and Lackawanna, New York.  While Bethlehem continues to
evaluate the impact future emission control regulations will have on these
operations, it believes that these operations will be able to comply.

    Negotiations between Bethlehem and federal and state regulatory agencies
are being conducted to resolve differences in interpretation of certain
environmental control requirements.  In some instances, those negotiations are
being held in connection with the resolution of pending environmental
proceedings.  Bethlehem believes there will not be any significant curtailment
or interruptions of any of its important operations as a result of these
proceedings and negotiations.

    Bethlehem cannot predict future specific environmental control
requirements.  Based on existing and anticipated regulations promulgated under
presently enacted legislation, Bethlehem estimates that capital expenditures
for new environmental control equipment will average about $30 million per year
over the next two years.  However, estimates of future capital expenditures and
operating costs required for environmental compliance are subject to numerous
uncertainties, including the evolving nature of regulations, possible
imposition of more stringent requirements, availability of new technologies and
the timing of expenditures.

    Under the Resource Conservation and Recovery Act, as amended ("RCRA"), the
owners of certain facilities that managed hazardous waste after 1980 are
required to investigate and, if appropriate, remediate

                                  - 5 -

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certain historic environmental contamination found at the facility.  All of
Bethlehem's major facilities may be subject to this "Corrective Action
Program", and Bethlehem has implemented or is currently implementing the
program at its facilities located in Steelton, Pennsylvania; Lackawanna, New
York; Burns Harbor, Indiana; and Sparrows Point, Maryland.  At Steelton,
Bethlehem has completed a RCRA Facility Investigation ("RFI"), a Corrective
Measures Study ("CMS") and a remediation program, which program received formal
approval of the United States Environmental Protection Agency (the "EPA") and
was completed in 1994.  At Lackawanna, Bethlehem is conducting an RFI which is
expected to be completed later this year.  At Burns Harbor, Bethlehem has
recently received EPA approval of its proposed scope of work for an RFI which
will require several years to complete.  At Sparrows Point, Bethlehem, the EPA
and the Maryland Department of the Environment have agreed to a phased RFI as
part of a comprehensive multimedia pollution prevention agreement which was
lodged in the U.  S.  District Court for Maryland as a proposed consent decree
on February 25, 1997.  The potential costs for possible remediation activities,
if any, at Lackawanna, Burns Harbor and Sparrows Point and the timeframe for
implementation of these activities cannot be reasonably estimated until the
RFIs, and possibly the CMSs, have been completed and approved.

    Under the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended ("CERCLA", also known as "Superfund"), the EPA has
authority to impose liability for site remediation on generators and
transporters of waste, as well as past and present owners and operators of the
sites where the waste was disposed of regardless of, fault or the legality of
the disposal activities.  Bethlehem is actively involved at a total of 25 sites
where it has been advised that it may be considered a potentially responsible
party under CERCLA or the corresponding State Superfund legislation.  Based on
its experience regarding site remediation and its knowledge of and extent of
involvement in such sites, Bethlehem expects that its share of the costs for
remediation of these sites will not be material.

    Although it is possible that Bethlehem's future quarterly or annual results
of operations could be materially affected by the future costs of environmental
compliance, Bethlehem believes that the future costs of environmental
compliance will not have a material adverse effect on its consolidated
financial position or on its competitive position with respect to other
integrated domestic steelmakers that are subject to the same environmental
requirements.  To the extent that competitors are not required to undertake
equivalent costs, Bethlehem's competitive position could be adversely affected.

    Since 1946, Bethlehem has had a formal program of environmental control.
Bethlehem was one of the first industrial companies in the United States to
recognize its obligation to its communities, the citizens of its communities
and the environment.  Bethlehem continues to expand its commitment to the
environment through the development and implementation of progressive
environmental programs consistent with the goals identified in its Corporate
Environmental Policy and the CERES Principles which Bethlehem first endorsed
last year.  During 1996, Bethlehem published its first environmental progress
report and CERES report based upon its environmental accomplishments and
activities for the preceding year.


PURCHASED MATERIALS AND SERVICES

    Bethlehem purchases about $3 billion per year of raw materials, energy,
equipment, goods and services from commercial sources.  Difficulties in
obtaining these items and the prices paid by Bethlehem could affect Bethlehem's
profitability.  Bethlehem has made significant progress in 1996 through its
Strategic Sourcing initiatives and expects further progress in 1997.  The
objectives of Strategic Sourcing are to forge a strong, competitive base of
supply partners who share Bethlehem's commitment to deliver superior value to
customers; to realize significant, immediate and sustainable improvements in
the total cost, quality and value of purchased goods and services; and to
establish mutual commitments to continuous improvement.  See "ITEM 2.
PROPERTIES--Properties Relating to the Basic Steel Operations Segment--Raw
Material Properties and Interests" of this Report for a further description of
the sources of iron ore, coal, limestone and other raw materials essential to
Bethlehem's steelmaking business.

                               - 6 -

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RESEARCH AND DEVELOPMENT

    Bethlehem engages in its own research activities for the improvement of
existing products and the development of new products and more efficient
operating processes.  During 1996, 1995 and 1994, Bethlehem spent about $25
million, $25 million and $24 million, respectively, in its research and
development activities.  Bethlehem owns a number of United States and
corresponding foreign patents that relate to a wide variety of products and
processes, has pending various patent applications and is licensed under a
number of patents.  Bethlehem also licenses its patents to others, producing
royalties.  During 1996, six United States patents covering a variety of new
developments were awarded to Bethlehem.  However, Bethlehem believes that no
single patent or license, which expires from time to time, or any group of
patents or licenses relating to a particular product or process is of material
importance in its overall business.  Bethlehem also owns registered trademarks
for certain of its products and service marks for certain of its services
which, unlike patents and licenses, are renewable so long as they are continued
in use and properly protected.

    In 1994, Bethlehem and U.  S.  Steel Group, a unit of USX Corporation,
entered into a Cooperative Research and Development Agreement.  During 1996,
Bethlehem and U.  S.  Steel Group continued to conduct joint research and
development activities under the Agreement in the field of basic ironmaking and
steelmaking technologies and processes, such as primary iron and steel process
development, finishing process development and process instrumentation
development.  Bethlehem believes that the joint research and development
activities are helping to meet the Agreement's goals, including expediting
technological developments and improvements, enhancing Bethlehem's domestic and
worldwide competitiveness and reducing research and development costs and time
periods.  Bethlehem, therefore, intends to continue the joint research and
development activities in 1997.  Notices in connection with the Agreement have
been filed in accordance with the National Cooperative Research and Development
Act of 1993.


EMPLOYEES AND EMPLOYMENT COSTS

    At the end of 1996, Bethlehem had about 17,500 employees compared with
about 18,300 employees at the end of 1995 and 19,900 employees at the end of
1994.  About 13,000 Bethlehem employees are covered by collective bargaining
agreements with the United Steelworkers of America ("USWA").  The agreement
applicable to a majority of Bethlehem's USWA represented employees includes a
guarantee of minimum hours of work which limits Bethlehem's ability to reduce
costs during economic downturns.

    Under the terms of Bethlehem's 1993 labor agreements with the USWA, most
employees at its steel operations received a bonus in 1996 of $.50 per hour
worked (maximum payment of $1,000) based on Bethlehem having achieved the
required level of 1995 adjusted consolidated pre-tax income.  Also, profit
sharing of 8 percent of adjusted consolidated annual income before taxes,
unusual items and expenses applicable to the plan plus 2 percent of adjusted
profits of certain operations is paid to USWA represented employees in the
following year.  Profit sharing is also paid to non-represented employees based
on specific Corporate and Business Unit plans and performance.  Bethlehem paid
about $75 million in 1996 and expects to pay about $45 million for income
related bonus, profit-sharing and shortfall amounts in early 1997.

    The 1993 labor agreements provided for Reopener Negotiations in March 1996
for certain wage and benefit provisions (excluding pensions and health care
benefits) with changes effective August 1, 1996, and continuing through the
expiration of the labor agreement on August 1, 1999.  Bethlehem did not reach a
settlement with the USWA and the parties submitted unresolved issues to
arbitration.  The Arbitrator selected Bethlehem's final offer which included
three wage increases totaling $1.00 per hour, lump sums totaling up to $2,000
per employee (one-half depends on achieving certain levels of profits in 1997
and 1998) and continuing one floating holiday each year for the next three
years.  As a result of the Arbitrator's decision, most employees at steel
operations received a $.50 per hour wage increase on August 1, 1996, and will
receive a $.25 per hour wage increase on August 1, 1997 and 1998.  The
Arbitrator's decision will not have a material adverse effect on Bethlehem's
future profitability.

                                    - 7 -

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<PAGE> 9

    Under other provisions of the labor agreements, Bethlehem is required to
pay "shortfall amounts" each year up to 10 percent of the first $100 million
and 20 percent in excess of $100 million of consolidated income before taxes,
unusual items and expenses applicable to the shortfall plan.  Shortfall amounts
arise when employees terminate employment and ESOP Preference Stock, held in
trust for employees in reimbursement for wage and benefit reductions in prior
years, is converted into Common Stock and sold for amounts less than the stated
value of the Preference Stock ($32 for Series A and $40 for Series B).
Bethlehem issued about 61,000 shares of Series B Preference Stock in 1996 and
about 40,800 shares in 1995 to a trustee for the benefit of employees for 1995
and 1994, respectively, and expects to issue about 35,000 shares in early 1997
for the 1996 plan year.

    Bethlehem's ability to operate could be impacted by a strike or work
stoppage if it is unable to negotiate a new agreement with its represented
employees when the existing agreement expires in 1999.  Also, Bethlehem's
profitability could be adversely affected if increased costs associated with
any future contract are not recoverable through productivity improvements or
price increases.

    For further information with regard to Bethlehem's employment costs, see
"Employment Cost Summary--All Employees" under "Financial Review and Operating
Analysis" in Bethlehem's 1996 Annual Report to Stockholders.  As set forth on
page 16 of this Report, such discussion is incorporated herein by reference.


EMPLOYEE POSTRETIREMENT OBLIGATIONS

    Bethlehem has substantial financial obligations related to its employee
postretirement plans for pensions and health care.  Also, due to the excess of
projected benefit obligations over pension fund assets, Bethlehem's annual
pension expense is substantially higher on a per ton basis than that of most
other domestic steel producers.  This pension expense, combined with
postretirement health care expense, puts Bethlehem at a competitive
disadvantage with respect to such costs compared to most other domestic steel
producers.  As of December 31, 1996, Bethlehem's consolidated balance sheet
reflects liabilities of $870 million and $1,595 million for the actuarial
present value of unfunded accumulated benefit obligations ("ABO") for pensions
and postretirement benefits other than pensions, respectively.  The calculation
of the actuarial present value of the ABOs for active employees assumes
continued employment with projections for retirements, deaths, resignations and
discharges.  If the actual retirement of active employees is significantly
earlier than projected (for plant closings or other reasons), the ABOs would
increase substantially.  The charges for employees terminated as a result of
plant shutdowns or restructurings vary depending upon the demographics of the
work force, but could be $100,000 per employee.  The recording of these charges
could result in a material adverse impact on Bethlehem's financial condition
because of the increase in recorded liabilities, decrease in stockholders'
equity and increases in required contributions to the pension fund and retiree
health care payments.

    During 1996, long-term interest rates increased.  As a result, Bethlehem
increased the discount rate used to calculate the actuarial present value of
its ABO for pensions from the 7.25 percent used at December 31, 1995, to 7.75
percent at November 30, 1996.  This increase in the discount rate reduced
Bethlehem's ABO for pensions and restored $67 million to additional paid-in
capital as required by generally accepted accounting principles.  For each 25
basis point change in the future discount rate, Bethlehem's ABO for pensions
changes by about $100 million.  A decrease in interest rates at November 30,
1997, from November 30, 1996, would require Bethlehem to increase the actuarial
present value of its ABO for pensions and might again require Bethlehem to
reduce additional paid-in capital depending on the market value of Bethlehem's
pension trust fund assets (which at November 30, 1996, was $4.2 billion).  For
postretirement benefits other than pensions, principally health care and life
insurance, the same increase in the discount rate as of November 30, 1996, and
potential future changes also apply to the actuarial present value of
Bethlehem's ABO.  However, because different accounting principles apply, there
is no immediate change in the recorded liability or potential charge to equity.

    Bethlehem has contributed amounts to its pension fund substantially in
excess of amounts required under current law and regulations.  As a result,
Bethlehem currently has a funding standard credit balance which would allow it
under current law and regulations to defer all pension funding for about two
years, although it presently has no plans to do so.

                                   - 8 -
<PAGE>
<PAGE> 10

RESTRUCTURING ACTIVITIES

    As part of Bethlehem's efforts to make its business and operations more
competitive, Bethlehem has implemented, and will continue to consider, a wide
range of restructuring alternatives.

    JOINT VENTURES, PARTNERSHIPS, FACILITY SHARING ARRANGEMENTS AND MERGERS.
Bethlehem has considered, and discussed with others, various opportunities for
joint ventures, partnerships, facility sharing arrangements and mergers of all
or part of Bethlehem.  Bethlehem will continue to explore such opportunities.
See "ITEM 2.  PROPERTIES." of this Report for a description of joint ventures
in which Bethlehem participates.

    FACILITY SHUTDOWNS AND RESTRUCTURINGS.  During the last five years,
Bethlehem has shut down or restructured facilities and operations and has
reduced its annual steelmaking capability from 16.0 million tons in 1992 to
10.5 million tons in 1996.  Bethlehem has recorded charges of $815 million in
connection with these actions, including a $465 million restructuring charge
($382 million after-tax) in 1996.  See Note C to the Consolidated Financial
Statements.  On October 30, 1996, Bethlehem announced a restructuring plan to
improve its financial performance and stockholder value.  Planned actions
include the sale or shutdown of Bethlehem Structural Products Corporation,
BethForge, CENTEC and BethShip.  It also included the write-off of the assets
of its Coke Division located in Bethlehem, Pennsylvania, as an impaired asset
in accordance with generally accepted accounting principles, although Bethlehem
will continue to operate this facility.  Bethlehem is currently negotiating
with qualified buyers for the sale of BethForge, CENTEC and BethShip.  Efforts
to sell Bethlehem Structural as an ongoing business have been unsuccessful and
operations ceased during the first quarter of 1997.  Although Bethlehem has
no current plans to do so, if it becomes necessary for Bethlehem to shut down
or restructure additional businesses and operations in the future, it could
incur substantial additional charges in the process.  The recording of
these charges could have a material adverse impact on Bethlehem's financial
condition because of the increase in recorded liabilities and decrease in
stockholders' equity.

    ASSET SALES.  Since early 1986, Bethlehem has implemented an extensive
program of asset sales.  About 35 businesses have been sold since the program
began.  Upon the completion of Bethlehem's most recent restructuring plan
discussed above, Bethlehem believes that its remaining core steel businesses
(Burns Harbor, Sparrows Point and PST) will provide a solid base on which to
build the company and add value for its stockholders.  Bethlehem does not
anticipate raising substantial cash in the future from asset sales.

 CAPITAL STRUCTURE

    As of December 31, 1996, Bethlehem's capital structure was highly leveraged
reflecting its significant recorded liability for pensions and other
post-retirement obligations.  Although Bethlehem believes it has sufficient
access to funds for the operation of its business, its existing obligations and
below investment grade credit rating may limit its ability to raise capital in
the future.


FORWARD-LOOKING STATEMENTS

    Bethlehem and its representatives may from time to time make
forward-looking statements in reports filed with the Securities and Exchange
Commission, reports to stockholders, press releases, other written documents
and oral presentations.  These forward-looking statements may include, among
others, statements concerning projected levels of sales, shipments and income,
pricing trends, cost-reduction strategies, product mix, anticipated capital
expenditures and other future plans and strategies.

    As permitted by the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995, Bethlehem is identifying in this Report
important factors that could cause Bethlehem's actual results to differ
materially from those projected in these forward-looking statements.  These
factors include, but are not necessarily limited to:

(bullet) the effect of planned and unplanned outages on Bethlehem's operations;

                                 - 9 -
<PAGE>
<PAGE> 11

(bullet) the highly cyclical nature of the domestic steel industry and many of
         the markets supplied by Bethlehem and the effect of that cyclicality
         on prices and volume;

(bullet) the potential impact of strikes or work stoppages at facilities of
         Bethlehem's customers and suppliers;

(bullet) the sensitivity of Bethlehem's results to relatively small changes in
         the prices obtained by Bethlehem for its products;

(bullet) intense competition due to world steel overcapacity, new domestic
         capacity over the next several years, low-cost mini-mills, imports and
         substitute materials;

(bullet) the high capital requirements associated with integrated steel
         facilities;

(bullet) the significant costs associated with environmental controls and
         remediation expenditures and the uncertainty of future environmental
         control requirements;

(bullet) availability and prices associated with raw materials, supplies,
         utilities and other services and items required by Bethlehem's
         operations;

(bullet) employment matters, including costs and uncertainties associated with
         Bethlehem's collective bargaining agreements, and employee
         post-retirement obligations, including the impact of changes in the
         interest rate assumptions applicable in determining employee
         postretirement obligations and health care costs for retirees and
         their families;

(bullet) the effect of possible future restructuring activities;

(bullet) Bethlehem's highly leveraged capital structure; and

(bullet) the effect of existing and possible future lawsuits filed against
         Bethlehem.

The discussion of these factors is contained elsewhere in "ITEM 1.  BUSINESS"
and in "ITEM 3.  LEGAL PROCEEDINGS" of this Report and are incorporated by
reference into this section.  Bethlehem does not undertake to update any
forward-looking statements that may be made from time to time by Bethlehem or
its representatives.


ITEM 2.   PROPERTIES.

PROPERTIES RELATING TO THE BASIC STEEL OPERATIONS SEGMENT

BURNS HARBOR DIVISION

    The principal operations of the Burns Harbor Division are located in
Indiana on Lake Michigan, about 50 miles southeast of Chicago, Illinois.  Burns
Harbor produces hot rolled sheet, cold rolled sheet, corrosion-resistant coated
sheet and plates.  It is a major supplier of sheet and plate products to the
automotive, service center, construction, machinery and appliance markets.
Principal facilities include a sintering plant, two coke oven batteries, two
blast furnaces, including new coal injection facilities, three basic oxygen
furnaces with a combined annual raw steel production capability of about 5.6
million tons, a vacuum degassing facility, two continuous slab casters with a
combined annual production capability of about 4.0 million tons, a 50 x 90-inch
slabbing mill, two sheared plate mills (110-inch and 160-inch), an 80-inch
hot-strip mill, two continuous pickling lines, an 80-inch five-stand cold
reducing mill, sheet finishing mills, a continuous heat treating line, batch
annealing facilities, a 48-inch continuous electrogalvanizing line and a
72-inch hot-dip galvanizing line.  Burns Harbor operates a cold reducing mill,
a continuous pickling line, a galvanizing line and two coke oven batteries in
Lackawanna, New York.  About 80 percent of the steel produced at Burns Harbor
is continuously cast; the remaining 20 percent is ingot cast.  Ingot cast slabs
are used primarily to make steel plates.

    Burns Harbor's utilization of raw steel production capability was 92
percent during 1996.

                               - 10 -

<PAGE>
<PAGE> 12

SPARROWS POINT DIVISION

    The operations of the Sparrows Point Division are located on the Chesapeake
Bay near Baltimore, Maryland.  Sparrows Point produces hot rolled sheet, cold
rolled sheet, corrosion resistant coated sheet (e.g., galvanized sheet,
Galvalume sheet), tin mill products and steel plate.  Its principal markets
include construction, containers and service centers.  Principal facilities
include a sintering plant, a large blast furnace, two basic oxygen furnaces
with an annual raw steel production capability of about 3.6 million tons, a
two-strand continuous slab caster with an annual production capability of about
3.6 million tons, a 160-inch sheared plate mill, a 68-inch hot- strip mill,
three continuous pickling lines, three cold reducing mills (66-inch, 56-inch
and 48- inch), continuous and batch annealing facilities, two galvanizing
lines, a Galvalume line, a 48- inch hot-dip galvanizing/Galvalume line and tin
mill facilities that include tin and chrome plating lines.  Sparrows Point
continuously casts essentially 100 percent of its total production volume.

    Sparrows Point's utilization of raw steel production capability was 98
percent during 1996.


PENNSYLVANIA STEEL TECHNOLOGIES, INC. ("PST")

    Located in Steelton, Pennsylvania, south of Harrisburg, Pennsylvania, PST
uses electric furnace steelmaking and a continuous caster in the production of
railroad rails, specialty blooms and flat bars.  It is one of only two rail
producers in the United States.  PST also produces large- diameter pipe for the
oil and gas industries.  Principal facilities include a DC electric arc furnace
with an annual raw steel production capability of about 1.3 million tons, a
ladle furnace, a vacuum degassing facility, a continuous bloom caster, a
44-inch blooming mill, a 28-inch rail mill, in-line rail head-hardening
facilities, finishing and shipping facilities for long-length (80-foot) rails,
a 20-inch bar mill and an electric fusion welded pipe mill.

    PST's utilization of raw steel production capability was 59 percent during
1996.


JOINT VENTURES

    Bethlehem participates in a joint venture, known as Double G Coatings
Company, L.P., which operates a 270,000 ton per year sheet coating line near
Jackson, Mississippi.  The line produces galvanized and Galvalume coated sheets
primarily for the construction market.  The Sparrows Point Division provides
cold rolled coils for about half of Double G's annual capacity and is
responsible for marketing its share of the finished product.

    Bethlehem also participates in a joint venture which owns and operates a
400,000 ton per year electrogalvanizing line at Walbridge, Ohio.  This facility
produces corrosion-resistant sheet steel primarily for the automobile industry
and other consumer durables markets.  The Burns Harbor Division provides cold
rolled coils for 75 percent of Walbridge's annual capacity and is responsible
for marketing its share of the finished product.

    Bethlehem also participates in two joint ventures with facilities located
adjacent to the Burns Harbor operations:  Indiana Pickling and Processing
Company that operates a pickling line and Chicago Cold Rolling, L.L.C.  that
operates a reversing cold mill complex.

    Bethlehem also has indirect equity interests in various iron ore
properties.  See "Raw Material Properties and Interests" below.


RAW MATERIAL PROPERTIES AND INTERESTS

    IRON ORE.  Bethlehem has indirect equity interests in various iron ore
operating properties, which (excluding tonnages applicable to interests owned
by others) it estimates contained recoverable reserves at December 31, 1996,
sufficient to produce at least 9 million tons of direct shipping iron ore from
properties located in Brazil and 475 million tons of iron ore concentrates and
pellets, of which 206 million tons are from properties located in Minnesota and
269 million tons are from properties located in Canada.  As previously
announced, Bethlehem has signed an agreement for the sale of its equity
interest in the Iron Ore Company of

                                  - 11 -

<PAGE>
<PAGE> 13

Canada ("IOC").  Upon completion of the sale, which is subject to governmental
approvals and IOC shareholder consent, Bethlehem will continue its relationship
as a customer of IOC and will purchase iron ore at market prices.  In addition
to the estimated reserves at operating properties, Bethlehem also has indirect
equity interests in undeveloped or nonoperating iron ore properties, which
(excluding tonnages applicable to interests owned by others) it estimates
contained recoverable reserves at December 31, 1996, sufficient to produce at
least 16 million tons of direct shipping iron ore from properties located in
Brazil and 126 million tons of iron ore pellets from properties located in
Minnesota.

    The iron ore operating properties in which Bethlehem has interests have
mining and processing facilities capable of supplying the major portion of
Bethlehem's current annual iron ore requirements.  However, because of the
location of Bethlehem's steel operations and the iron ore products best suited
to these facilities, Bethlehem engages in iron ore sales and exchanges with
other consumers and purchases a portion of its iron ore requirements.  These
purchases have been from various sources, including sources in which it has
ownership interests, under a variety of contractual arrangements extending over
varying periods of time.

    Bethlehem's share of the annual iron ore production by enterprises in which
it has ownership interests, for Bethlehem's use or sale to trade customers, was
13.9 million tons in 1996 and 14.7 million tons in 1995.  In addition to these
sources, Bethlehem purchased 1.7 million tons of iron ore in each of 1996 and
1995 from sources in which it had no ownership interests.  In 1996, Bethlehem
obtained about 86 percent of its iron ore requirements from operations in which
it had ownership interests compared with 85 percent in 1995.

    Bethlehem had trade sales of iron ore in 1996 and 1995 of 1.2 million tons
and .6 million tons, respectively.  Additional iron ore trade sales commitments
through December 31, 1997, presently aggregate .3 million tons.  No iron ore
trade sales commitments exist beyond 1997.

    The interests in foreign iron ore properties described above are subject to
the risks associated with investments in foreign countries, including the risk
of nationalization.

    COAL AND COKE.  Bethlehem owns and leases coal operating properties in West
Virginia, which it estimates contained recoverable reserves at December 31,
1996, sufficient to produce at least 23 million tons of steam coal.

    In addition to the estimated reserves at operating properties, Bethlehem
also owns and leases undeveloped or nonoperating coal properties in
Pennsylvania and West Virginia, which it estimates contained recoverable
reserves at December 31, 1996, sufficient to produce at least 167 million tons
of coal, of which about 89 percent and 11 percent, respectively, are
metallurgical and steam coal.

    Bethlehem's coal operations produced 1.9 million tons of coal in 1996 and
3.3 million tons in 1995.  Trade shipments of coal were 1.2 million tons in
1996 compared with 2.2 million tons in 1995.  During 1996, Bethlehem sold and
leased its Eagle Nest coal operations and sold other coal reserves located in
Boone County, West Virginia.

    In 1996, Bethlehem obtained about 13 percent of its coal requirements from
its own mines, compared with 19 percent in 1995.  The balance of Bethlehem's
requirements was purchased from commercial sources.  Through December 31, 2005,
Bethlehem is committed to satisfy certain of its coal requirements from a
single supplier.

    Bethlehem continues to operate coke-making facilities at Bethlehem,
Pennsylvania; Burns Harbor, Indiana; and Lackawanna, New York.

    OTHER RAW MATERIALS.  Bethlehem purchases its other raw material
requirements from commercial sources.

                                   - 12 -

<PAGE>
<PAGE> 14

TRANSPORTATION

    Bethlehem owns five subsidiary shortline railroads which transport raw
materials and semifinished steel products within various Bethlehem operations
and serve other customers on their lines.  Bethlehem manages an owner-operated
interstate trucking company serving Bethlehem's operations and other
facilities.

    The Burns Harbor Division operates two 1,000 foot ore vessels (one owned
and one under long-term charter), which are used for the transportation of iron
ore on the Great Lakes.

PROPERTIES RELATING TO THE STEEL RELATED OPERATIONS SEGMENT

    As discussed under "ITEM 1.  BUSINESS--Facility Shutdowns and
Restructurings", all of the properties of the Steel Related Operations Segment
will either be sold or shut down.


GENERAL

    While Bethlehem's principal operations and facilities are adequately
maintained, they are of varying ages, technologies and operating efficiencies.
Bethlehem believes that most of its operations and facilities currently are
competitive with the operations and facilities of its principal competitors.
Bethlehem will continue to make capital expenditures to improve and maintain
the competitiveness of its operations and facilities.  See "ITEM 1.
BUSINESS--General--Capital Expenditures" of this Report for a discussion of
Bethlehem's capital expenditures.

    All principal operations and facilities are owned in fee by Bethlehem
except for two continuous casters at the Sparrows Point Division and the Burns
Harbor Division which are being leased.  Bethlehem capitalized the expenditures
related to the leases for two continuous casters and financed the construction
of two new hot-dip galvanizing lines at its Burns Harbor and Sparrows Point
Divisions.  These two facilities are pledged as collateral for the borrowings.


ITEM 3.   LEGAL PROCEEDINGS.

    Bethlehem is a party to numerous legal proceedings incurred in the ordinary
course of its business, including the matters specifically discussed below.

    On October 4, 1990, the State of Maryland Department of Environment (the
"MDE") filed a civil action against Bethlehem in the Circuit Court of Baltimore
County, Maryland seeking civil penalties for alleged violations of the Maryland
air pollution regulations arising out of exceedances of the visible emissions
standards established for various sources at the Sparrows Point Division by an
October 1987 Consent Order, as amended in June 1989.  On April 30, 1991, the
MDE filed a complaint in intervention in a civil action filed on April 25,
1991, by the Justice Department on behalf of the United States Environmental
Protection Agency (the "EPA") against Bethlehem, alleging violations of the
Clean Air Act resulting from alleged violations of Maryland air pollution
regulations at the Sparrows Point Division.  The complaint in intervention,
which was approved by the Court on June 14, 1991, incorporated all of the
violations alleged in the MDE complaint.  On May 1, 1992, a settlement between
the parties to the EPA action was memorialized in a Consent Decree, which was
entered by the Court on July 1, 1992.  The Consent Decree resolved all of the
issues in both the federal and state actions except for a single count in the
MDE action dealing with alleged violations from the basic oxygen furnace.  The
parties have agreed to resolve that count with a civil penalty payment of
$350,000 as part of a comprehensive multimedia pollution prevention agreement
which was lodged in the U.  S.  District Court for Maryland as a proposed
consent decree on February 25, 1997.

    On June 9, 1994, the EPA issued an administrative Complaint and Notice of
Opportunity for Hearing alleging several violations of the polychlorinated
biphenyl (PCB) regulations under the Toxic Substance Control Act by Bethlehem
at the Sparrows Point Division.  The Complaint sets forth a proposed civil
penalty of $145,500.  On June 30, 1994, Bethlehem filed its Answer and Request
for Hearing.  Settlement discussions have been

                                   - 13 -

<PAGE>
<PAGE> 15
initiated between Bethlehem and the EPA.  If such discussions do not succeed,
Bethlehem believes it has meritorious defenses and will vigorously defend the
action.

    On December 6, 1995, the Pennsylvania Department of Environmental
Protection (the "DEP") issued a notice alleging violations by Bethlehem of the
Pennsylvania Air Pollution Control Act based on sulfur dioxide emissions
exceeding plan approval limits for new steelmaking facilities at Pennsylvania
Steel Technologies, Inc.  The parties have negotiated a consent order which
required Bethlehem to pay a civil penalty of $95,000 by October 31, 1996, to
install additional control equipment by March 31, 1998, and to make additional
civil penalty payments of $5,400 for each month from July 1996 until the
earlier of March 1998 or the start-up of a proposed sulfur dioxide scrubber.
Bethlehem is in full compliance with the consent order.

    On March 29, 1996, the U.  S.  Department of Justice, on behalf of the EPA,
brought a civil action against Bethlehem in the U.  S.  District Court for the
Northern District of Indiana for alleged violations of the Clean Water Act and
the Safe Drinking Water Act at the Burns Harbor Division.  The Complaint
alleges that, from November 1992 to April 1994, the Division discharged
pollutants from its dock wall without a permit as required by the Clean Water
Act and failed to meet certain requirements of an underground injection well
permit.  Settlement negotiations were initiated prior to the filing of the
Complaint and the government has suggested settlement for total civil penalties
of $441,300 and appropriate injunctive relief.  If settlement negotiations are
unsuccessful, Bethlehem believes it has meritorious defenses and will
vigorously defend the action.

    On July 31, 1996, the EPA issued an Administrative Complaint alleging that
Bethlehem violated the Comprehensive Environmental Response, Compensation and
Liability Act by failing to report until January 31, 1995, releases in excess
of the reportable quantity of sodium nitrite at the Burns Harbor Division on
each of 20 days in January 1995.  The Complaint sets forth a proposed civil
penalty of $148,500.  Bethlehem filed an answer and request for hearing on
August 19, 1996, and has requested a settlement conference.  If settlement
discussions are unsuccessful, Bethlehem believes it has meritorious defenses
and will vigorously defend the action.

    On February 14, 1997, the EPA issued a notice alleging violations by
Bethlehem Structural Products Corporation (BSPC) of the Clean Air Act, based on
emissions from Coke Oven Battery A at BSPC on various days in 1996 exceeding
those allowed under the Pennsylvania State Implementation Plan (the "SIP").
Settlement negotiations have been initiated among BSPC, the EPA and the DEP to
resolve Battery A compliance issues under the National Emissions Standards for
coke oven emissions as well as under the SIP.  The EPA has initially proposed a
civil penalty of $322,500 as part of the consent decree.  If settlement
discussions do not succeed, Bethlehem believes it has meritorious defenses and
will vigorously defend the action.

    See "ITEM 1.  BUSINESS--General--Environmental Control and Remediation
Expenditures" of this Report for a discussion of Bethlehem's potential
responsibilities for environmental cleanup at certain sites under RCRA and
CERCLA.

    Bethlehem cannot predict with any certainty the outcome of any legal
proceedings to which it is a party.  However, in the opinion of Bethlehem's
management, adequate reserves have been recorded for losses which are likely to
result from these proceedings.  To the extent that such reserves prove to be
inadequate, Bethlehem would incur a charge to earnings which could be material
to its future results of operations in particular quarterly or annual periods.
The outcome of these proceedings, however, is not currently expected to have a
material adverse effect on Bethlehem's consolidated financial position.


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

    There were no matters submitted to a vote of security holders during the
fourth quarter of 1996.

                                - 14 -

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<PAGE> 16

Executive Officers of the Registrant.

    The executive officers of Bethlehem as of March 21, 1997, are as follows:

          Name                    Age             Position
          ----                    ---             --------
   Curtis H. Barnette             62      Chairman (Chief Executive
                                           Officer)

   Roger P. Penny                 60      President (Chief Operating
                                           Officer)

   Gary L. Millenbruch            59      Executive Vice President (Chief
                                           Financial Officer) and Treasurer

   John A. Jordan, Jr.            61      Senior Vice President
                                           (Administration)

   David P. Post                  63      Senior Vice President (Commercial)

   Lonnie A. Arnett               51      Vice President (Accounting) and
                                           Controller

   Dr. Walter N. Bargeron         54      President, Burns Harbor Division

   Stephen G. Donches             51      Vice President (Public Affairs)

   Duane R. Dunham                55      President, Sparrows Point Division

   Andrew R. Futchko              54      President, Pennsylvania Steel
                                           Technologies, Inc.

   William H. Graham              51      Vice President (Law),
                                           General Counsel and Secretary

   John L. Kluttz                 54      Vice President (Union Relations)

   Dr. Carl F. Meitzner           57      Vice President (Planning)

   Dr. Augustine E. Moffitt, Jr.  51      Vice President (Safety, Health
                                           and Environment)

   Gregory F. Paolini             64      President, Bethlehem Structural
                                           Products Corporation, BethForge,
                                           Inc., and CENTEC Roll Corporation

   Dr. Malcolm J. Roberts         54      Vice President (Technology) and
                                           Chief Technology Officer

   Robert A. Rudzki               43      Vice President (Purchasing and
                                           Transportation) and
                                           Chief Procurement Officer

   Dorothy L. Stephenson          47      Vice President (Human Resources)


    All of the executive officers have held responsible management or
professional positions with Bethlehem or its subsidiaries for more than the
past five years.

    The By-laws of Bethlehem provide that the officers shall be chosen annually
by the Board of Directors and that each officer shall hold office until his
successor shall have been elected and shall qualify or until his earlier death
or his earlier resignation or removal in the manner provided in the By-laws.

                                 - 15 -

<PAGE>
<PAGE> 17

                                  PART II

ITEM 5.   MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED
          SECURITY HOLDER MATTERS.

    As of March 21, 1997, there were 112,061,570 shares of Bethlehem Common
Stock outstanding held by about 36,600 stockholders of record.  The principal
market for Bethlehem Common Stock is the New York Stock Exchange.  Bethlehem
Common Stock is also listed on the Chicago Stock Exchange.  Dividends on
Bethlehem Common Stock are paid quarterly when declared by Bethlehem's Board of
Directors.

    Under the provisions of Bethlehem's 10-3/8% Senior Notes due 2003,
Bethlehem's ability to pay dividends on its Common Stock is restricted.  See
Note K to the Consolidated Financial Statements.  At December 31, 1996, about
$450 million was available for the payment of Common Stock dividends under
these provisions.

    Bethlehem has not paid a dividend on its Common Stock since the fourth
quarter of 1991.  In accordance with Bethlehem's policy, future dividends will
be determined by the Board of Directors (subject to any applicable
restrictions) on the basis of attained results and the business outlook.

    The following table sets forth, for the periods indicated, the high and low
sales prices of Bethlehem Common Stock as reported in the consolidated
transaction reporting system.  The closing sale price of Bethlehem Common Stock
on March 21, 1997, as reported in the consolidated transaction reporting
system, was $8.250.

                      1996                        1995
                      ----                        ----
                   Sales Prices               Sales Prices
                   ------------               ------------
   Period          High     Low               High     Low
   ------          ----     ---               ----     ---
First Quarter    $15.875  $13.125           $19.125  $14.125
Second Quarter    14.500   11.500            16.375   13.625
Third Quarter     12.000    9.250            18.250   13.750
Fourth Quarter    10.313    7.625            14.750   12.625


ITEM 6.   SELECTED FINANCIAL DATA.

    The information required by this Item is incorporated by reference from
page 26 of Bethlehem's 1996 Annual Report to Stockholders.  With the exception
of the information specifically incorporated by reference, the 1996 Annual
Report to Stockholders is not to be deemed filed as part of this Report for
purposes of this Item.


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

    The information required by this Item is incorporated by reference from
pages 1 to 5 and 8 to 11, inclusive, of Bethlehem's 1996 Annual Report to
Stockholders.  With the exception of the information specifically incorporated
by reference, the 1996 Annual Report to Stockholders is not to be deemed filed
as part of this Report for purposes of this Item.


ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

    The information required by this Item is incorporated by reference from
pages 12 to 23, inclusive, of Bethlehem's 1996 Annual Report to Stockholders.
With the exception of the information specifically incorporated by reference,
the 1996 Annual Report to Stockholders is not to be deemed filed as part of
this Report for purposes of this Item.


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

     None.

                                - 16 -
<PAGE>
<PAGE> 18

                                 PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

    In addition to the information set forth under the caption "Executive
Officers of the Registrant" in Part I of this Report, the information required
by this Item is incorporated by reference from pages 2 to 6, inclusive, of
Bethlehem's Proxy Statement for the 1997 Annual Meeting of Stockholders.  With
the exception of the information specifically incorporated by reference,
Bethlehem's Proxy Statement is not to be deemed filed as part of this Report
for purposes of this Item.


ITEM 11.  EXECUTIVE COMPENSATION.

    The information required by this Item is incorporated by reference from
pages 9 to 14, inclusive, of Bethlehem's Proxy Statement for the 1997 Annual
Meeting of Stockholders.  With the exception of the information specifically
incorporated by reference, Bethlehem's Proxy Statement is not to be deemed
filed as part of this Report for purposes of this Item.


ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
          MANAGEMENT.

    The information required by this Item is incorporated by reference from
pages 7 and 15 of Bethlehem's Proxy Statement for the 1997 Annual Meeting of
Stockholders.  With the exception of the information specifically incorporated
by reference, Bethlehem's Proxy Statement is not to be deemed filed as part of
this Report for purposes of this Item.


ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

    The information required by this Item is incorporated by reference from the
material appearing under the heading "Certain Business Relationships" appearing
on page 8 and the heading "Indemnification Assurance Agreements" appearing on
page 15 of Bethlehem's Proxy Statement for the 1997 Annual Meeting of
Stockholders.  With the exception of the information specifically incorporated
by reference, Bethlehem's Proxy Statement is not to be deemed filed as part of
this Report for purposes of this Item.




                                  - 17 -

<PAGE>
<PAGE> 19

                                    PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
          FORM 8-K.

(a) DOCUMENTS FILED AS PART OF THIS REPORT:

    The following is an index of the financial statements, schedules and
exhibits included in this Report or incorporated herein by reference.


     (1)  Financial Statements.

         BETHLEHEM STEEL CORPORATION AND CONSOLIDATED SUBSIDIARIES

                                                                       Page
                                                                       ----
 Consolidated Statements of Income for the years 1996, 1995 and 1994.    *
 Consolidated Balance Sheets as of December 31, 1996
    and 1995. . . . . . . . . . . . . . . . . . . . . . . . . . . .      *
 Consolidated Statements of Cash Flows for the years 1996
    1995 and 1994 . . . . . . . . . . . . . . . . . . . . . . . . .      *
 Notes to Consolidated Financial Statements
    (Including Quarterly Financial Data). . . . . . . . . . . . . .      *

 (2)  CONSOLIDATED FINANCIAL STATEMENT SCHEDULES.

 Report of Independent Auditors On Consolidated Financial
    Statement Schedules . . . . . . . . . . . . . . . . . . . . . .    F-1

 Schedules:

    II --  Valuation and Qualifying Accounts and Reserves, years
              ended December 31, 1996, 1995 and 1994. . . . . . . .    F-3

---------------
    * Incorporated in this Report by reference from pages 12 to 23, inclusive,
      of Bethlehem's 1996 Annual Report to Stockholders referred to below.

    The Consolidated Financial Statements, together with the report thereon of
Price Waterhouse LLP dated January 29, 1997, appearing on pages 12 to 24,
inclusive, of the 1996 Annual Report to Stockholders are incorporated by
reference in this Form 10-K Annual Report.  With the exception of those pages,
the 1996 Annual Report to Stockholders is not to be deemed filed as part of
this Report for purposes of this Item.  The Schedules listed above should be
read in conjunction with the consolidated financial statements in such 1996
Annual Report to Stockholders.

    Schedules not included have been omitted because they are not applicable or
the required information is shown in the consolidated financial statements or
notes thereto.

    Separate financial statements of subsidiaries not consolidated and 50
percent or less owned persons accounted for by the equity method have been
omitted because considered in the aggregate as a single subsidiary they do not
constitute a significant subsidiary.

(3)  EXHIBITS.

    The following is an index of the exhibits included in this Report or
incorporated herein by reference.

 (3)(a)  Second Restated Certificate of Incorporation (Incorporated by
         reference from Exhibit 3 to Bethlehem's quarterly report on Form 10-Q
         for the quarter ended March 31, 1994).

    (b)  Amendment to Second Restated Certificate of Incorporation
         (Incorporated by reference from Exhibit 3(i) to Bethlehem's quarterly
         report on Form 10-Q for the quarter ended June 30, 1995).

    (c)  By-laws of Bethlehem Steel Corporation, as amended October 1, 1988
         (Incorporated by reference from Exhibit (3)(b) to Bethlehem's Annual
         Report on Form 10-K for the fiscal year ended December 31, 1993).

 (4)(a)  Rights Agreement, dated as of September 28, 1988, between Bethlehem
         Steel Corporation and Morgan Shareholder Services Trust Company
         (Incorporated by reference from Exhibit (4)(a) to Bethlehem's Annual
         Report on Form 10-K for the fiscal year ended December 31, 1993).

                                       - 18 -

<PAGE>
<PAGE> 20

     (b) Amendment to Rights Agreement, dated as of November 1, 1995, between
         Bethlehem Steel Corporation and First Chicago Trust Company of New
         York (formerly Morgan Shareholder Services Trust Company)
         (Incorporated by reference from Exhibit 4(a) to Bethlehem's Annual
         Report on Form 10-K for the fiscal year ended December 31, 1995).

     (c) Bethlehem is a party to certain long-term debt agreements where the
         amount involved does not exceed 10% of Bethlehem's total consolidated
         assets.  Bethlehem agrees to furnish a copy of any such agreement to
         the Commission upon request.

*(10)(a) Excess Benefit Plan of Bethlehem Steel Corporation and Subsidiary
         Companies, as amended July 29, 1992 (Incorporated by reference from
         Exhibit 10(a) to Bethlehem's quarterly report on Form 10-Q for the
         quarter ended June 30, 1992).

    *(b) 1988 Stock Incentive Plan of Bethlehem Steel Corporation (Incorporated
         by reference from Exhibit 10(b) to Bethlehem's Annual Report on Form
         10-K for the fiscal year ended December 31, 1992).

    *(c) 1994 Stock Incentive Plan of Bethlehem Steel Corporation (Incorporated
         by reference from Exhibit 1 to Bethlehem's Proxy Statement in
         connection with its Annual Meeting of Shareholders held on April 26,
         1994).

    *(d) 1994 Non-Employee Directors Stock Plan of Bethlehem Steel Corporation
         (Incorporated by reference from Exhibit 2 to Bethlehem's Proxy
         Statement in connection with its Annual Meeting of Shareholders held
         on April 26, 1994).

    *(e) Special Incentive Compensation Plan of Bethlehem Steel Corporation,
         which is contained in Article Seven of the Second Restated Certificate
         of Incorporation referred to in Exhibit 3(a) to this Report.

    *(f) Supplemental Benefits Plan of Bethlehem Steel Corporation and
         Subsidiary Companies, as amended July 29, 1992 (Incorporated by
         reference from Exhibit 10(b) to Bethlehem's quarterly report on Form
         10-Q for the quarter ended June 30, 1992).

    *(g) Post-Retirement Retainer Plan for Non-Officer Directors (Incorporated
         by reference from Exhibit (10)(o) to Bethlehem's Annual Report on Form
         10-K for the fiscal year ended December 31, 1992).

     (h) Form of Indemnification Assurance Agreement between Bethlehem Steel
         Corporation and each of its directors and executive officers listed on
         Schedule A thereto.

 (11)    Statement regarding computation of earnings per share.

 (13)    Those portions of the 1996 Annual Report to Stockholders of Bethlehem
         Steel Corporation which are incorporated by reference into this Form
         10-K Annual Report.

 (23)    Consent of Independent Auditors (included on page F-2 of this Report).

 (27)    Financial Data Schedule.

------------------
* Compensatory plans in which Bethlehem's directors and executive officers
  participate.


(b) REPORTS ON FORM 8-K.

     During the quarter ended December 31, 1996, no reports on Form 8-K were
     filed by Bethlehem.

                                  - 19 -


<PAGE>
<PAGE> 21

                                    SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, Bethlehem Steel Corporation has duly caused
this Report to be signed on its behalf by the undersigned, thereunto duly
authorized, on the 26th day of March, 1997.

                              BETHLEHEM STEEL CORPORATION,
                              by  /s/ Lonnie A. Arnett
                                 --------------------------
                                   Lonnie A. Arnett
                                   Vice President and Controller

         Pursuant to the requirements of the Securities Exchange Act of 1934,
as amended, this Report has been signed below by the following persons on
behalf of Bethlehem Steel Corporation and in the capacities indicated on the
26th day of March, 1997.
<TABLE>
<CAPTION>

     <S>                                        <C>

     /s/ Curtis H. Barnette                     /s/ Thomas L. Holton
     ------------------------------             ------------------------------
       Curtis H. Barnette                         Thomas L. Holton
       Chairman and Director                      Director
       (principal executive officer)


     /s/ Gary L. Millenbruch                    /s/ Lewis B. Kaden
     ------------------------------             ------------------------------
       Gary L. Millenbruch                        Lewis B. Kaden
       Executive Vice President, Treasurer        Director
       and Director
       (principal financial officer)


     /s/ Lonnie A. Arnett                       /s/ Harry P. Kamen
     ------------------------------             ------------------------------
       Lonnie A. Arnett                           Harry P. Kamen
       Vice President and Controller              Director
       (principal accounting officer)


     /s/ Benjamin R. Civiletti                  /s/ Winthrop Knowlton
     ------------------------------             ------------------------------
       Benjamin R. Civiletti                      Winthrop Knowlton
       Director                                   Director


     /s/ Worley H. Clark                        /s/ Robert McClements, Jr.
     ------------------------------             ------------------------------
       Worley H. Clark                            Robert McClements, Jr.
       Director                                   Director


     /s/ John B. Curcio                         /s/ Roger P. Penny
     ------------------------------             ------------------------------
       John B. Curcio                             Roger P. Penny
       Director                                   Director



     /s/ Shirley D. Peterson                    /s/ William A. Pogue
     ------------------------------             ------------------------------
       Shirley D. Peterson                        William A. Pogue
       Director                                   Director



     /s/ Dean P. Phypers                        /s/ John F. Ruffle
     ------------------------------             ------------------------------
       Dean P. Phypers                            John F. Ruffle
       Director                                   Director






</TABLE>


                                  - 20 -

<PAGE> 22
                        REPORT OF INDEPENDENT AUDITORS
                       ON FINANCIAL STATEMENT SCHEDULES

To the Board of Directors
of Bethlehem Steel Corporation


Our audits of the consolidated financial statements referred to in our report
dated January 29, 1997 appearing on page 24 of the 1996 Annual Report to
Stockholders of Bethlehem Steel Corporation (which report and consolidated
financial statements are incorporated by reference in this Annual Report on
Form 10-K) also included an audit of the Financial Statement Schedules listed
in Item 14(a)(2) of this Form 10-K.  In our opinion, these Financial Statement
Schedules present fairly, in all material respects, the informtion set forth
therein when read in conjunction with the related consolidated financial
statements.



/s/ Price Waterhouse LLP


1177 Avenue of the Americas
New York, NY   10036
January 29, 1997


                                      F-1

<PAGE>
<PAGE> 23

                        CONSENT OF INDEPENDENT AUDITORS


We hereby consent to the incorporation by reference in the Registration
Statements on Form S-8 (No. 2-90795, No. 2-71699, No. 2-53880, No. 2-90796,
No. 2-67314, No. 33-23516, No. 33-23688, No. 33-52267, No. 33-58019, No.
33-58021 and No. 33-60507) of Bethlehem Steel Corporation of our report dated
January 29, 1997 appearing on page 24 of the 1996 Annual Report to Stockholders
which is incorporated in this Annual Report on Form 10-K.  We also consent to
the incorporation by reference of our report on the Financial Statement
Schedules, which appears on page F-1 of this Form 10-K.



/s/ Price Waterhouse LLP


1177 Avenue of the Americas
New York, NY  10036
March 26, 1997



                                 F-2



<PAGE>
<PAGE> 24

                           BETHLEHEM STEEL CORPORATION


                                 10-K SCHEDULE II
                  VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
                                 ($ in Millions)

<TABLE>
<CAPTION>
                                                CHARGED
                                   BALANCE AT  (CREDITED)                          BALANCE AT
                                   12/31/95    TO INCOME   DEDUCTIONS   OTHER      12/31/96
                                   ----------  ----------  ----------  --------    ----------
<S>                                <C>         <C>         <C>         <C>         <C>
CLASSIFICATION
  Doubtful Receivables & Returns     $19.5       $0.1       $1.2 (a)      -          $20.8
  Long-term Receivables                4.5       (0.1)         -          -            4.4
  Deferred Income Tax Asset          360.2       67.0          -       (17.2)(b)     410.0



                                                CHARGED
                                   BALANCE AT  (CREDITED)                          BALANCE AT
                                   12/31/94    TO INCOME   DEDUCTIONS   OTHER      12/31/95
                                   ----------  ----------  ----------  --------    ----------
CLASSIFICATION
  Doubtful Receivables & Returns     $18.6       $1.2      ($0.3)(a)      -          $19.5
  Long-term Receivables                4.5         -          -           -            4.5
  Deferred Income Tax Asset          383.2      (37.0)        -         14.0 (c)     360.2



                                                CHARGED
                                   BALANCE AT  (CREDITED)                          BALANCE AT
                                   12/31/93    TO INCOME   DEDUCTIONS   OTHER      12/31/94
                                   ----------  ----------  ----------  --------    ----------
CLASSIFICATION
  Doubtful Receivables & Returns     $16.3       $2.4      ($0.1)(a)      -          $18.6
  Long-term Receivables                4.5         -          -           -            4.5
  Deferred Income Tax Asset          406.7      (13.0)        -        (10.5)(d)     383.2

</TABLE>
(a) Amounts written-off less collections and reinstatements.
(b) Represents eliminating the valuation allowance recorded for a $82 million
    ($67 million after-tax) adjustment to equity at December 31, 1995 required
    to recognize the minimum pension liability.  See Notes G and K to the
    Consolidated Financial Statements.
(c) Represents the valuation allowance for a $82 million ($67 million
    after-tax) charge to equity required to recognize the minimum pension
    liability.  See Notes G and K to the Consolidated Financial Statements.
(d) Represents eliminating the valuation allowance recorded for a $60 million
    ($50 million after-tax) adjustment to equity at December 31, 1993 required
    to recognize the minimum pension liability.  See Notes G and K to the
    Consolidated Financial Statements.


                                      F-3

<PAGE>
<PAGE> 25


                               EXHIBIT INDEX


EXHIBIT NO.         DESCRIPTION


  (3)(a)  Second Restated Certificate of Incorporation (Incorporated by
          reference from Exhibit 3 to Bethlehem's quarterly report on Form 10-Q
          for the quarter ended March 31, 1994).

     (b)  Amendment to Second Restated Certificate of Incorporation
          (Incorporated by reference from Exhibit 3(i) to Bethlehem's quarterly
           report on Form 10-Q for the quarter ended June 30, 1995).

     (c)  By-laws of Bethlehem Steel Corporation, as amended October 1, 1988
          (Incorporated by reference from Exhibit (3)(b) to Bethlehem's Annual
          Report on Form 10-K for the fiscal year ended December 31, 1993).

  (4)(a)  Rights Agreement, dated as of September 28, 1988, between Bethlehem
          Steel Corporation and Morgan Shareholder Services Trust Company
          (Incorporated by reference from Exhibit (4)(a) to Bethlehem's Annual
          Report on Form 10-K for the fiscal year ended December 31, 1993).

     (b)  Amendment to Rights Agreement, dated as of November 1, 1995, between
          Bethlehem Steel Corporation and First Chicago Trust Company of New
          York (formerly Morgan Shareholder Services Trust Company).
          (Incorporated by reference from Exhibit 4(a) to Bethlehem's Annual
          Report on Form 10-K for the fiscal year ended December 31, 1995).

     (c)  Bethlehem is a party to certain long-term debt agreements where the
          amount involved does not exceed 10% of Bethlehem's total consolidated
          assets.  Bethlehem agrees to furnish a copy of any such agreement to
          the Commission upon request.

*(10)(a)  Excess Benefit Plan of Bethlehem Steel Corporation and Subsidiary
          Companies, as amended July 29, 1992 (Incorporated by reference from
          Exhibit 10(a) to Bethlehem's quarterly report on Form 10-Q for the
          quarter ended June 30, 1992).

    *(b)  1988 Stock Incentive Plan of Bethlehem Steel Corporation (Incorporated
          by reference from Exhibit 10(b) to Bethlehem's Annual Report on Form
          10-K for the fiscal year ended December 31, 1992).


------------
*  Compensatory plans in which Bethlehem's directors and executive officers
participate.



<PAGE>
<PAGE> 26


    *(c) 1994 Stock Incentive Plan of Bethlehem Steel Corporation (Incorporated
         by reference from Exhibit 1 to Bethlehem's Proxy Statement in
         connection with its Annual Meeting of Shareholders held on April 26,
         1994).

    *(d) 1994 Non-Employee Directors Stock Plan of Bethlehem Steel Corporation
         (Incorporated by reference from Exhibit 2 to Bethlehem's Proxy
         Statement in connection with its Annual Meeting of Shareholders held
         on April 26, 1994).

    *(e) Special Incentive Compensation Plan of Bethlehem Steel Corporation,
         which is contained in Article Seven of the Second Restated Certificate
         of Incorporation referred to in Exhibit 3(a) to this Report.

    *(f) Supplemental Benefits Plan of Bethlehem Steel Corporation and
         Subsidiary Companies, as amended July 29, 1992 (Incorporated by
         reference from Exhibit 10(b) to Bethlehem's quarterly report on Form
         10- Q for the quarter ended June 30, 1992).

    *(g) Post-Retirement Retainer Plan for Non-Officer Directors (Incorporated
         by reference from Exhibit (10)(o) to Bethlehem's Annual Report on Form
         10-K for the fiscal year ended December 31, 1992).

     (h) Form of Indemnification Assurance Agreement between Bethlehem Steel
         Corporation and each of its directors and executive officers listed on
         Schedule A thereto.

    (11) Statement regarding computation of per share earnings.

    (13) Those portions of the 1996 Annual Report to Stockholders of Bethlehem
         Steel Corporation which are incorporated by reference into this Form
         10- K Annual Report.

    (23) Consent of Independent Auditors (included on page F-2 of this Report).

    (27) Financial Data Schedule.

---------------
*  Compensatory plans in which Bethlehem's directors and executive officers
   participate.


<PAGE>
<PAGE> 27
                                                             Exhibit 10(h)


                FORM OF INDEMNIFICATION ASSURANCE AGREEMENT


                       [Bethlehem Steel Corporation]




[Name and Address of
Director or Officer]

Dear                :

         This letter will confirm the agreement and understanding between
Bethlehem Steel Corporation (the "Company") and you regarding your service as a
[Director/Officer] of the Company.

         It is and has been the policy of the Company to indemnify its officers
and directors against any costs, expenses and other liabilities to which they
may become subject by reason of their service to the Company, and to insure its
directors and officers against such liabilities, as and to the extent permitted
by applicable law and in accordance with the principles of good corporate
governance.  In this regard, the Company's By-laws (Article IX) require that
the Company indemnify and advance costs and expenses to (collectively,
"indemnify") its directors and officers as permitted by Delaware law.  A copy
of the relevant provisions of the Company's By-laws, as amended, is attached
hereto.

         In consideration of your service as a [Director/Officer] of the
Company, the Company shall indemnify you, and hereby confirms its agreement to
indemnify you, to the full extent provided by applicable law and the By-laws of
the Company as currently in effect.  In particular, as provided by the By-laws,
the Company shall make any necessary determination as to your entitlement to
indemnification in respect of any liability within 60 days of receiving a
written request from you for indemnification against such liability.  You have
agreed to provide the Company with such information or documentation as the
Company may reasonably request to evidence the liabilities against which
indemnification is sought or as may be necessary to permit the Company to
submit a claim in respect thereof under any applicable directors and officers
liability insurance or other liability insurance policy.  You have further
agreed to cooperate with the Company in the making of any determination
regarding your entitlement to indemnification.  If the Company does not make a
determination within the required 60- day period, a favorable determination
will be deemed to be made, and you shall be entitled to payment, subject only
to your written agreement to refund such payment if a contrary determination is
later made and the delay was by reason of the inability of the Company to make
such determination within the 60-day period.  In the event the


<PAGE>
<PAGE> 28

Company shall determine that you are not entitled to indemnification, the
Company shall give you written notice thereof specifying the reason therefor,
including any determinations of fact or conclusions of law relied upon in
reaching such determination.  Notwithstanding any determination made by the
Company that you are not entitled to indemnification, you shall be entitled to
seek a de novo judicial determination of your right to indemnification under
the By-laws and this agreement by commencing an appropriate action therefor
within 180 days after the Company shall notify you of its determination.  The
Company shall not oppose any such action by reason of any prior determination
made by it as to your right to indemnification or, except in good faith, raise
any objection not specifically relating to the merits of your indemnification
claim or not considered by the Company in making its own determination.  In any
such proceeding, the Company shall bear the burden of proof in showing that
your conduct did not meet the applicable standard of conduct required by the
By-laws or applicable law for indemnification.  It is understood that, as
provided in Section 4 of Article IX of the By- laws, any expenses incurred by
you in any investigation or proceeding by the Company or before any court
commenced for the purpose of making any such determination shall be reimbursed
by the Company.  No future amendment of the By-laws shall diminish your rights
under this agreement, unless you shall have consented to such amendment.

         Your right to indemnification as aforesaid shall be in addition to any
right to remuneration to which you may from time to time be entitled as a
[Director/Officer].

         It is understood and agreed that your right to indemnification shall
not entitle you to continue in your present position with the Company or any
future position to which you may be appointed or elected and that you shall be
entitled to indemnification under the By-laws only in respect to liabilities
arising out of acts or omissions or alleged acts or omissions by you as a
[Director/Officer] or as otherwise provided by the By-laws, but you shall be
entitled to such indemnification with respect to any such liability, whether
incurred or arising during or after your service as a [Director/Officer] and
whether before or after the date of this letter, in respect of any claim,
cause, action, proceeding or investigation, whether commenced, accruing or
arising during or after your service as a [Director/Officer] and whether before
or after the date of this letter.

         In further consideration of your service as a [Director/Officer] of
the Company, the Company in connection with its indemnification policy has
arranged for the issuance of, and you shall be entitled to the benefits of, an
"Irrevocable Straight Standby Letter of Credit" issued by Morgan Guaranty Trust
Company of New York.  Said letter of credit has been arranged for the purpose
of assuring payment to you, certain other current and former directors and
officers of the Company and future directors, officers and employees of the
Company and its affiliates designated by the Board of Directors of the Company
("Indemnitees") of any amounts to which you and they may become entitled as

                                      - 2 -


<PAGE>
<PAGE> 29

indemnification pursuant to the By-laws in the event that, for any reason, the
Company shall fail promptly to pay to you, upon written request therefor, any
such indemnification, said assurance for all Indemnitees being limited at any
time to $5,000,000 in aggregate amount.  The Company understands that there has
been established an irrevocable trust, the Bethlehem Indemnification Trust, for
which First Valley Bank, Bethlehem, Pennsylvania, acts as trustee, for the
purpose, among other things, of administering the respective interests of the
Indemnitees in said letter of credit, and the Company has consented to the
issuance and delivery of said letter of credit to the Bethlehem Indemnification
Trust.  Unless renewed or replaced by a comparable letter of credit in the
amount of $5,000,000, the full undrawn amount of said letter of credit may be
drawn upon prior to the expiration thereof.  Drawings on said letter of credit
may be arranged through the Bethlehem Indemnification Trust, as provided by the
trust agreement therefor, by contacting the First Valley Bank, One Bethlehem
Plaza, Bethlehem, Pennsylvania 18018.  You have agreed to repay to the
Bethlehem Indemnification Trust any amount paid to you by such trust (i) if it
shall ultimately be determined (by the Company and upon expiration of the
180-day period for commencement of a judicial proceeding for a de novo
determination or by a final judicial determination) that you are not entitled
under this agreement or otherwise to indemnification from Bethlehem in respect
of the liability for which you shall have received payment or (ii) if you shall
subsequently receive payment in respect of such liability from any liability
insurer or from Bethlehem or any successor thereto.  It is agreed that, in
addition to the rights of any other person to do so, the Company shall have the
right to compel any repayment to the Bethlehem Indemnification Trust so
required.

         This agreement shall terminate upon the later of (i) the tenth
anniversary of the date on which you shall cease to be a director or officer of
the Company or (ii) the final termination or resolution of all actions, suits,
proceedings or investigations commenced within such ten-year period and
relating to the Company or any of its affiliates or your services thereto to
which you may be or become a party and of all claims for indemnification by you
under this agreement or against the Bethlehem Indemnification Trust asserted
within such ten-year period.

         This agreement supersedes any and all prior agreements between the
Company and you relating to the subject matter hereof.  It is understood and
agreed that this agreement is binding upon the Company and its successors and
shall inure to your benefit and that of your heirs, distributees and legal
representatives.  This agreement, and the interpretation and enforcement
hereof, shall be governed by the laws of the State of Delaware.  In
confirmation of the provisions of the Company's By-laws, the Company hereby
agrees to pay, and you shall be held harmless from and indemnified against, any
costs and expenses (including attorneys' fees) which you may reasonably incur
in connection with any challenge to the validity of, or the performance and
enforcement of,

                                   - 3 -

<PAGE>
<PAGE> 30

this agreement, in the same manner as provided by the Company's By-laws.

         If the foregoing is in accordance with your understanding of our
agreement, kindly countersign the enclosed copies of this letter, whereupon
this letter shall become a binding agreement in accordance with the laws of the
State of Delaware.

                                   Very truly yours,

                                   BETHLEHEM STEEL CORPORATION


                                   By: -----------------------------





-------------------------------
[Signature of Director/Officer]



                                - 4 -

<PAGE>
<PAGE> 31
                                                              Schedule A



1.   Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Curtis H. Barnette.

2.   Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Silas S. Cathcart.

3.   Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and George P. Jenkins.

4.   Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Reginald H. Jones.

5.   Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Winthrop Knowlton.

6.   Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Russell E. Palmer.

7.   Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Ellmore C. Patterson.

8.   Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Dean P. Phypers.

9.   Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and William W. Scranton.

10.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Donald H. Trautlein.

11.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Walter F. Williams.

12.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Lonnie A. Arnett.

13.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and D. Sheldon Arnot.

14.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Robert W. Cooney.



<PAGE>
<PAGE> 32

15.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Frank S. Dickerson, III.

16.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and George T. Fugere.

17.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and John A. Jordan, Jr.

18.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and James F. Kegg.

19.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and David H. Klinges.

20.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Edward H. Kottcamp, Jr.

21.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and James H. Leonard.

22.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Gary L. Millenbruch.

23.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and C. Adams Moore.

24.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Reynold Nebel.

25.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and James C. Van Vliet.

26.  Indemnification Assurance Agreement dated August 22, 1986 between
     Bethlehem Steel Corporation and Robert C. Wilkins.

27.  Indemnification Assurance Agreement dated December 29, 1986 between
     Bethlehem Steel Corporation and Larry L. Adams.

28.  Indemnification Assurance Agreement dated December 29, 1986 between
     Bethlehem Steel Corporation and Benjamin C. Boylston.

                               - 2 -
<PAGE>
<PAGE> 33

29.  Indemnification Assurance Agreement dated January 28, 1987 between
     Bethlehem Steel Corporation and Herman E. Collier.

30.  Indemnification Assurance Agreement dated January 28, 1987 between
     Bethlehem Steel Corporation and Edwin A. Gee.

31.  Indemnification Assurance Agreement dated January 28, 1987 between
     Bethlehem Steel Corporation and Thomas L. Holton.

32.  Indemnification Assurance Agreement dated March 1, 1987 between Bethlehem
     Steel Corporation and Roger P. Penny.

33.  Indemnification Assurance Agreement dated May 27, 1987 between Bethlehem
     Steel Corporation and Andrew M. Weller.

34.  Indemnification Assurance Agreement dated January 27, 1988 between
     Bethlehem Steel Corporation and John B. Curcio.

35.  Indemnification Assurance Agreement dated January 27, 1988 between
     Bethlehem Steel Corporation and William C. Hittinger.

36.  Indemnification Assurance Agreement dated January 27, 1988 between
     Bethlehem Steel Corporation and William A. Pogue.

37.  Indemnification Assurance Agreement dated September 27, 1989 between
     Bethlehem Steel Corporation and Robert McClements, Jr.

38.  Indemnification Assurance Agreement dated September 27, 1989 between
     Bethlehem Steel Corporation and John L. Kluttz.

39.  Indemnification Assurance Agreement dated June 27, 1990 between Bethlehem
     Steel Corporation and Duane R. Dunham.

40.  Indemnification Assurance Agreement dated September 26, 1990 between
     Bethlehem Steel Corporation and John F. Ruffle.

41.  Indemnification Assurance Agreement dated May 1, 1991 between Bethlehem
     Steel Corporation and Carl F. Meitzner.

42.  Indemnification Assurance Agreement dated July 1, 1991 between Bethlehem
     Steel Corporation and Walter N. Bargeron.

                                 - 3 -
<PAGE>
<PAGE> 34

43.  Indemnification Assurance Agreement dated March 1, 1992 between Bethlehem
     Steel Corporation and David P. Post.

44.  Indemnification Assurance Agreement dated November 1, 1992 between
     Bethlehem Steel Corporation and Stephen G. Donches.

45.  Indemnification Assurance Agreement dated November 1, 1992 between
     Bethlehem Steel Corporation and William H. Graham.

46.  Indemnification Assurance Agreement dated November 1, 1992 between
     Bethlehem Steel Corporation and G. Penn Holsenbeck.

47.  Indemnification Assurance Agreement dated March 1, 1993 between Bethlehem
     Steel Corporation and Benjamin R. Civiletti.

48.  Indemnification Assurance Agreement dated March 1, 1993 between Bethlehem
     Steel Corporation and Worley H. Clark.

49.  Indemnification Assurance Agreement dated March 1, 1993 between Bethlehem
     Steel Corporation and Harry P. Kamen.

50.  Indemnification Assurance Agreement dated April 28, 1993 between Bethlehem
     Steel Corporation and Joseph F. Emig.

51.  Indemnification Assurance Agreement dated April 28, 1993 between Bethlehem
     Steel Corporation and Andrew R. Futchko.

52.  Indemnification Assurance Agreement dated April 28, 1993 between Bethlehem
     Steel Corporation and Timothy Lewis.

53.  Indemnification Assurance Agreement dated April 28, 1993 between Bethlehem
     Steel Corporation and William E. Wickert, Jr.

54.  Indemnification Assurance Agreement dated March 1, 1994 between Bethlehem
     Steel Corporation and Augustine E. Moffitt, Jr.

55.  Indemnification Assurance Agreement dated March 16, 1994 between Bethlehem
     Steel Corporation and Lewis B. Kaden.

56.  Indemnification Assurance Agreement dated January 31, 1996 between
     Bethlehem Steel Corporation and Shirley D. Peterson.

                                   - 4 -
<PAGE>
<PAGE> 35

57.  Indemnification Assurance Agreement dated May 1, 1996 between Bethlehem
     Steel Corporation and Gregory F. Paolini.

58.  Indemnification Assurance Agreement dated May 1, 1996 between Bethlehem
     Steel Corporation and Malcolm J. Roberts.

59.  Indemnification Assurance Agreement dated May 1, 1996 between Bethlehem
     Steel Corporation and Robert A. Rudzki.

60.  Indemnification Assurance Agreement dated May 1, 1996 between Bethlehem
     Steel Corporation and Dorothy L. Stephenson.


                                     - 5 -

<PAGE>
<PAGE> 36

                                                                   EXHIBIT (11)
                              BETHLEHEM STEEL CORPORATION


               STATEMENT REGARDING COMPUTATION OF EARNINGS PER SHARE
       (dollars in millions and shares in thousands, except per share data)
<TABLE>
<CAPTION>

                                                                  YEAR ENDED DECEMBER 31
                                                              ------------------------------
               PRIMARY EARNINGS PER SHARE                       1996       1995      1994
   --------------------------------------------------         --------   --------   --------
<S>                                                           <C>         <C>         <C>
NET INCOME (LOSS)                                             ($308.8)    $179.6      $80.5
LESS DIVIDEND REQUIREMENTS:
   $2.50 Preferred Dividend-Cash                                (10.0)     (10.0)     (10.0)
   $5.00 Preferred Dividend-Cash                                (12.5)     (12.5)     (12.5)
   $3.50 Preferred Dividend-Cash                                (17.9)     (17.9)     (17.9)
   5% Preference Dividend-Stock                                  (1.5)      (2.0)      (2.7)
                                                              --------   --------   --------
       TOTAL PREFERRED AND PREFERENCE DIVIDENDS                 (41.9)     (42.4)     (43.1)
                                                              --------   --------   --------
NET INCOME (LOSS) APPLICABLE TO COMMON STOCK                  ($350.7)    $137.2      $37.4
                                                              ========   ========   ========

AVERAGE SHARES OF COMMON STOCK AND
EQUIVALENTS OUTSTANDING:
   Common Stock                                               111,286    110,311    105,826
   Stock Options                                                    2         13        227
                                                              --------   --------   --------
           TOTAL                                              111,288    110,324    106,053
                                                              ========   ========   ========
PRIMARY EARNINGS PER SHARE                                     ($3.15)     $1.24      $0.35
                                                              ========   ========   ========
            FULLY DILUTED EARNINGS PER SHARE
NET INCOME (LOSS)                                             ($308.8)    $179.6      $80.5
LESS DIVIDEND REQUIREMENTS:
   $2.50 Preferred Dividend                                     (10.0)     (10.0)     (10.0)
   $5.00 Preferred Dividend                                     (12.5)     (12.5)     (12.5)
   $3.50 Preferred Dividend                                     (17.9)     (17.9)     (17.9)
   5% Preference Dividend                                        (1.5)       -         (2.7)
                                                              --------   --------   --------
NET INCOME (LOSS) APPLICABLE TO COMMON STOCK                  ($350.7)    $139.2      $37.4
                                                              ========   ========   ========

AVERAGE SHARES OF COMMON STOCK AND EQUIVALENTS AND
OTHER POTENTIALLY DILUTIVE SECURITIES OUTSTANDING:
   Common Stock                                               111,286    110,311    105,826
   Stock Options                                                    2         13        227
   $2.50 Preferred Stock                                           *          *          *
   $5.00 Preferred Stock                                           *          *          *
   $3.50 Preferred Stock                                           *          *          *
   5% Preference Stock                                             *       2,588         *
                                                              --------   --------   --------
           TOTAL                                              111,288    112,912    106,053
                                                              ========   ========   ========
FULLY DILUTED EARNINGS PER SHARE                               ($3.15)     $1.23      $0.35
                                                              ========   ========   ========
</TABLE>

 * Antidilutive