August 2,
2005


Mail Stop 4561

Andrew Jacobs
8401 North Central Expressway, Suite 800
Dallas, TX  75225

      Re:	Capstead Mortgage Corporation
		Form 10-K for the year ended December 31, 2004
		File No. 001-08896

Dear Mr. Jacobs:

      We have reviewed your filing and have the following
comments.
We have limited our review to only the issues addressed below and
will make no further review of your documents.  As such, all
persons
who are responsible for the adequacy and accuracy of the
disclosure
are urged to be certain that they have included all information
required pursuant to the Securities Exchange Act of 1934.

      Where indicated, we think you should revise your document in
response to these comments.  If you disagree, we will consider
your
explanation as to why our comment is inapplicable or a revision is
unnecessary.  Please be as detailed as necessary in your
explanation.
In some of our comments, we may ask you to provide us information
so
we may better understand your disclosure.  After reviewing this
information, we may or may not raise additional comments.

	Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or on any other
aspect
of our review.  Feel free to call us at the telephone numbers
listed
at the end of this letter.

Form 10-K

Exhibit 13

Report of Independent Registered Public Accounting Firm on Audit
of
Management`s Assessment of Internal Control Over Financial
Reporting,
page 4
1. We noted that the auditor`s report on management`s assessment
of
internal control over financial reporting was not signed.  Tell us
how you considered Item 302 of Regulation S-T.  Confirm that a
manually signed audit opinion has been received from the
independent
registered public accounting firm.

Report of Independent Registered Public Accounting Firm on Audit
of
the Consolidated Financial Statements, page 5
2. We noted that your report of the independent registered public
accounting firm was not signed.  Tell us how you considered Item
302
of Regulation S-T.  Confirm that a manually signed audit opinion
has
been received from the independent registered public accounting
firm.

Note 13 - Employee and Director Benefit Plans, page 26
3. We note that you cancelled all existing options and replaced
them
with new option grants at a reduced exercise price.  Please advise
us
how you considered EITF 00-23 in determining this transaction was
not
a repricing triggering variable plan accounting.

Management`s Discussion and Analysis of Financial Condition and
Results of Operations, page 31

Results of Operations, page 38
4. Reference is made to your disclosure of operating income and
operating income per common share as a non-GAAP measure.  Tell us
what consideration was given to the disclosure requirements of
Item
10(e) of Regulation S-K specifically as it relates to:
a. Avoiding titles that are the same or confusingly similar to
GAAP
financial measures;
b. Clarifying why you believe this measure is used to evaluate
performance rather than your liquidity based on the manner in
which
this measure is used (i.e. used by the Board to determine the
funds
available for dividends).  Note, per share measures of liquidity
are
prohibited; and
c. Demonstrating the usefulness of excluding recurring items.
Reference is made to Questions 8 and 9 in the Commission`s
Frequently
Asked Questions Regarding the Use of Non-GAAP Financial Measures.
In addition, tell us what consideration was given to including a
reference to where the investor can find the quantitative
reconciliation for this non-GAAP measure and disclosing this
information in a section clearly labeled as "Other Data."

*    *    *    *

      As appropriate, please respond to these comments within 10
business days or tell us when you will provide us with a response.
Detailed cover letters greatly facilitate our review.  Please file
your cover letter on EDGAR.  Please understand that we may have
additional comments after reviewing your responses to our
comments.

	We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be
certain that they have provided all information investors require
for
an informed decision.  Since the company and its management are in
possession of all facts relating to a company`s disclosure, they
are
responsible for the accuracy and adequacy of the disclosures they
have made.

	In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that

* the company is responsible for the adequacy and accuracy of the
disclosure in the filings;

* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filings; and

* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.

      In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filings or
in
response to our comments on your filings.


      You may contact Yolanda Crittendon, Staff Accountant, at
(202)
551-3472 or the undersigned at (202) 551-3413 if you have
questions.




							Sincerely,



      Cicely Luckey
      Branch Chief


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Mr. Andrew Jacobs
Capstead Mortgage Corporation
August 2, 2005
Page 1