UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                  SCHEDULE 13G

                  Under the Securities and Exchange Act of 1934

                           (Amendment No. __________)*




                              Hills Stores Company
                                (Name of Issuer)

                                  Common Stock
                         (Title of Class of Securities)

                                   431659 10 2
                                 (CUSIP Number)

Check the following box if a fee is being paid with this  statement o. (A fee is
not required  only if the filing  person:  (1) has a previous  statement on file
reporting  beneficial  ownership  of more  than  five  percent  of the  class of
securities  described  in Item 1;  and (2) has  filed  no  amendment  subsequent
thereto  reporting  beneficial  ownership  of  five  percent  of or less of such
class.) (See Rule 13-d-7).

*The  remainder of this cover page shall be filled out for a reporting  person's
initial filing on this form with respect to the subject class of securities, and
for any  subsequent  amendment  containing  information  which  would  alter the
disclosures provided in a prior cover page.

The information required in the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the  Securities  and Exchange Act
of 1934 ("Act") or otherwise  subject to the  liabilities of that section of the
Act but shall be subject to all other  provisions of the Act  (however,  see the
Notes).

   1      NAME OF REPORTING PERSON
          S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
          ML-Lee Acquisition Fund II, L.P.

   2      CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*   (a) |_|
                                                              (b) |X|
   3      SEC USE ONLY


   4      CITIZENSHIP OR PLACE OF ORGANIZATION
          Delaware

                              5           SOLE VOTING POWER
                                          -0-
        NUMBER OF
          SHARES
       BENEFICIALL
        Y OWNED BY
           EACH
        REPORTING
          PERSON
           WITH
                              6          SHARED VOTING POWER
                                         521,048

                              7          SOLE DISPOSITIVE POWER
                                         -0-

                              8          SHARED DISPOSITIVE POWER
                                         521,048

   9      AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
          521,048

   10     CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN
          SHARES
          X

   11     PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9
          5.3%

   12     TYPE OF REPORTING PERSON
          PN

Item 1(a)         Name of Issuer

Hills Stores Company

Item 1(b)         Address of Issuer's principal executive offices

15 Dan Road, Canton, MA  02021-9128

Item 2(a)         Name of person filing

ML-Lee   Acquisition  Fund  II,  L.P.  ("Fund  II"),  ML-Lee   Acquisition  Fund
(Retirement  Accounts) II, L.P. (the "Retirement Fund"),  Thomas H. Lee Advisors
II, L.P.  ("Advisors  II") and T.H. Lee Mezzanine II ("Mezzanine  II"),  each of
whom may be deemed to be beneficial  owners,  for purposes of this Schedule 13G,
of the securities  owned directly by Fund II and the Retirement Fund; and Thomas
H. Lee.

Item 2(b)         Address of principal business office or, if none, residence

Fund II:                   World Financial Center, South Tower,
                           New York, NY  10080

Retirement Fund:           World Financial Center, South Tower,
                           New York, NY  10080

Advisors II:               75 State Street, Boston, MA 02109

Mezzanine II:              75 State Street, Boston, MA 02109

Thomas H. Lee:             75 State Street, Boston, MA 02109

Item 2(c)         Citizenship

Fund II:                   Delaware
Retirement Fund:           Delaware
Advisors II:               Delaware
Mezzanine II:              Delaware
Thomas H. Lee:             United States

Item 2(d)         Title of class of securities

Common Stock

Item 2(e)         CUSIP Number

431659 10 2

Item 3            If Statement filed pursuant to Rule 13d-1(b) or 13d-2(b),
                  check whether the person filing is a

(a)      |_|      Broker or Dealer

(b)      |_|      Bank

(c)      |_|      Insurance Company

(d)      |_|      Investment Company

(e)      |_|      Investment Advisor

(f)      |_|      Employee Benefit Plan, Pension Fund or Endowment Fund

(g)      |_|      Parent Holding Company

(h)      |_|      Group

Item 4            Ownership

(a)      Amounts beneficially owned

As of December 31, 1995,  Fund II directly  owned 521,048 shares of the Issuer's
Common  Stock and the  Retirement  Fund  directly  owned  278,245  shares of the
Issuer's Common Stock.  Due to their existing  relationships  and  arrangements,
each of Fund II, the Retirement  Fund,  Advisors II, the  Investment  Advisor of
each of Fund II and the Retirement  Fund, and Mezzanine II, a general partner of
Advisors  II,  could be deemed to be  beneficial  owners,  for  purposes of this
Schedule  13G, of the shares of Common Stock held by Fund II and the  Retirement
Fund, which in the aggregate is 799,293 shares of Common Stock.

As of December 31, 1995, Mr. Lee  beneficially  owned 950 shares of the Issuer's
Common Stock.  The State Street Bank and Trust Company of Connecticut,  National
Association,  not  personally,  but solely as Trustee  under a Trust  Agreement,
dated as of September 29, 1989, as amended,  and known as the 1989 Thomas H. Lee
Nominee  Trust (the "1989 Thomas H. Lee Nominee  Trust") is the record holder of
shares  listed  above as being  beneficially  owned by Thomas  H. Lee.  The 1989
Thomas H. Lee Nominee Trust is controlled by its sole beneficiary, Mr. Lee.


In addition,  Mr. Lee may be deemed to  beneficially  own (i) 521,048  shares of
Common  Stock as a result of the  relationship  between Mr. Lee and the Fund II;
and (ii) 278,245 shares of Common Stock as a result of the relationship  between
Mr. Lee and the Retirement  Fund.  Mr. Lee is a general  partner of and controls
the  investment  advisors  to the  Fund  II and the  Retirement  Fund.  Mr.  Lee
disclaims such beneficial ownership.

(b)      Percent of class

Each of Fund II, the  Retirement  Fund,  Advisors II and  Mezzanine  II could be
deemed to be  beneficial  owners,  for  purposes  of this  Schedule  13G, of the
799,293  shares  of  Common  Stock  held by Fund  II and  the  Retirement  Fund;
beneficial  ownership of such shares would  constitute  beneficial  ownership of
approximately 8.1% of the Issuer's Common Stock.

Mr. Lee  beneficially  owns 0.0% of the Issuer's Common Stock. In addition,  Mr.
Lee could be deemed to be a beneficial owner, for purposes of this Schedule 13G,
of the 799,293 shares of Common Stock held by Fund II and the  Retirement  Fund;
beneficial  ownership of such shares would  constitute  beneficial  ownership of
approximately 8.1% of the Issuer's Common Stock.

(c)      Number of shares as to which such person has

The power to vote or to dispose of, or to direct the voting or disposal  of, the
799,293  shares of the Issuer's  Common Stock held by Fund II and the Retirement
Fund is vested in Advisors II (the Investment Advisor of each of Fund II and the
Retirement   Fund)  and  Mezzanine  II  (a  general  partner  of  Advisors  II).
Accordingly,  for purposes of this Schedule 13G, Fund II, the  Retirement  Fund,
Advisors II and Mezzanine II may each be deemed to share the power to vote or to
direct  the  voting of and may be deemed  to share  the power to  dispose  or to
direct the disposition of the securities covered by this Statement and therefore
each may be deemed to be a  beneficial  owner with  respect to such  securities.
Fund II and the Retirement Fund each disclaim beneficial ownership of any shares
not directly owned by them, respectively,  and Advisors II and Mezzanine II each
disclaim beneficial ownership of all such shares.

Mr.  Lee has the sole  power to vote or to direct the vote of 950 shares and the
sole  power to  dispose  or to direct  the  disposition  of 950.  As a result of
existing  relationship  with Fund II and the  Retirement  Fund,  Mr.  Lee may be
deemed  to share  the  power to vote of and may be  deemed to share the power to
dispose  or to direct  the  disposition  or to  direct  the  disposition  of the
securities  covered  by this  statement  and  therefore  may be  deemed  to be a
beneficial owner with respect to such securities.  Mr. Lee disclaims  beneficial
ownership of all shares  directly owned by the Fund,  Fund II and the Retirement
Fund.

Item 5            Ownership of 5% or Less of a Class

Not applicable


Item 6            Ownership of more than 5% on behalf of another person

Not applicable

Item 7            Identification and classification of the subsidiary which
                  acquired the security being reported on by the Parent
                  Holding Company

Not applicable

Item 8            Identification and classification of members of the Group

Not applicable

Item 9            Notice of Dissolution of Group

Not applicable

Item 10           Certification

Not applicable


                                   SIGNATURE


         After reasonable  inquiry and to the best of my knowledge and belief, I
certify that the information  set forth in this statement is true,  complete and
correct.




Dated:  February 14, 1996                   ML-Lee Acquisition Fund II, L.P.