SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549


                                   FORM 8-K

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

                                January 23, 1997
                ________________________________________________
                Date of report (Date of earliest event reported)

                         Petrie Stores Liquidating Trust
             ______________________________________________________
               (Exact Name of Registrant as Specified in Charter)

            New York              0-3777             22-6679945
          ______________    _____________________  __________________
          (State of         (Commission File No.)   (IRS Employer
         Incorporation)                            Identification No.)

                            70 Enterprise Avenue
                        Secaucus, New Jersey  07094
        ____________________________________________________________
           (Address of Principal Executive Offices and Zip Code)

                               (201) 422-0496
            ____________________________________________________
            (Registrant's telephone number, including area code)

                                    N/A
       _____________________________________________________________
       (Former Name or Former Address, if Changed Since Last Report)



          Item 5.   Other Events.

          A.   Settlement with the Internal Revenue Service.

                    As previously disclosed, in connection with an
          audit being conducted by the Internal Revenue Service
          (the "IRS"), the agent examining the federal tax return
          of Petrie Stores Corporation ("Petrie") for its fiscal
          year ended January 28, 1989 had raised an issue regarding
          the manner pursuant to which Petrie computed the basis of
          its shares of Toys "R" Us, Inc. common stock, par value
          $.10 per share ("Toys 'R' Us Common Stock"), transferred
          in connection with the exchange of certain of its
          exchangeable subordinated debentures.  The examining
          agent had proposed an adjustment to Petrie's taxable
          income for its 1989 fiscal year which would have resulted
          in additional federal tax liability, including interest,
          of approximately $53 million.

                    On March 14, 1997, a settlement agreement was
          entered into with the IRS pursuant to which the IRS and
          the Petrie Stores Liquidating Trust (the "Liquidating
          Trust") agreed to an adjustment to Petrie's taxable
          income for its 1989 fiscal year which resulted in the
          Liquidating Trust incurring additional federal tax
          liability, including interest, of approximately $11.3
          million.  

          B.   Sale of 1,000,000 Shares of Toys "R" Us, Inc. 
               Common Stock                                        

                    Between January 23, 1997 and February 5, 1997,
          the Liquidating Trust sold an aggregate of 1,000,000
          shares of Toys 'R' Us Common Stock or approximately 19.8%
          of the Toys "R" Us Common Stock held by the Liquidating
          Trust.  The aggregate consideration (after commissions)
          received by the Liquidating Trust in connection with the
          sale of Toys "R" Us Common Stock (the "Sale") was
          approximately $25.5 million.  The Sale was made in order
          for the Liquidating Trust to diversify its assets.



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

          Dated:  March 17, 1997

                                 PETRIE STORES LIQUIDATING TRUST

                                 By: /s/ Stephanie R. Joseph
                                    --------------------------
                                   Stephanie R. Joseph
                                   Manager and Chief Executive
                                     Officer