Exhibit 99.1

        Pier 1 Imports, Inc. Announces Reduction in Workforce

                  Focus is on Restoring Profitability

    FORT WORTH, Texas--(BUSINESS WIRE)--March 29, 2007--Pier 1
Imports, Inc. (NYSE:PIR) announced today that the Company has reduced
its workforce by approximately 175 positions. The reorganization will
simplify the administrative structure in the field as well as
consolidate support functions in the home office. This reduction will
eliminate approximately 75 field administration positions and reduce
the home office work force by approximately 100.

    Alex Smith, Pier 1's President and Chief Executive Officer
commented, "We know we can return our company to profitability and to
that end, we have established clear business priorities. One of those
priorities is to make the organization leaner, simpler and more
efficient in every way. The realignment of our field and home office
administrative functions will create a more responsive, cost-effective
structure that will improve long-term operating efficiency as well as
provide savings that can be reinvested into key areas of our business.
We regret that the reduction in workforce is a necessary step toward
achieving our objectives and we are assisting those individuals who
have been affected by today's events."

    During the first quarter of fiscal 2008, the Company expects to
incur severance and outplacement costs related to this realignment of
approximately $5 million. The Company estimates that this move will
generate annualized savings of approximately $17 million.

    Any forward-looking projections or statements made in this press
release should be considered in conjunction with the cautionary
statements contained in the Company's most recently filed quarterly
report on Form 10-Q. Management's expectations and assumptions
regarding planned store openings, financing of Company obligations
from operations, results from its new marketing, merchandising and
store operations strategies, and other future results are subject to
risks, uncertainties and other factors that could cause actual results
to differ materially from the anticipated results or other
expectations expressed in the forward-looking statements. Risks and
uncertainties that may affect Company operations and performance
include, among others, the effects of terrorist attacks or other acts
of war, conflicts or war involving the United States or its allies or
trading partners, labor strikes, weather conditions or natural
disasters that may affect sales, volatility of fuel and utility costs,
the general strength of the economy and levels of consumer spending,
consumer confidence, the availability of appropriate sites for
locating stores and distribution centers, availability of a qualified
labor force and management, the availability and proper functioning of
technology and communications systems supporting the Company's key
business processes, the ability of the Company to import merchandise
from foreign countries without significantly restrictive tariffs,
duties or quotas and the ability of the Company to source, ship and
deliver items from foreign countries to its U.S. distribution centers
at reasonable prices and rates and in a timely fashion.

    Refer to the Company's most recent SEC filings for discussion of
these and other risks and uncertainties that may affect the Company's
operations and performance. The Company assumes no obligation to
update or revise its forward-looking statements even if experience or
future changes make it clear that any projected results expressed or
implied will not be realized.

    Pier 1 Imports, Inc. is North America's largest specialty retailer
of imported decorative home furnishings and gifts with Pier 1
Imports(R) stores in 49 states, Puerto Rico, Canada, and Mexico and
Pier 1 Kids(R) stores in the United States. Information about the
Company is available on www.pier1.com.

    CONTACT: Pier 1 Imports, Inc.
             Cary Turner, 817-252-8400