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                                                                  RULE 424(B)(3)
                                                              FILE NO. 333-27367

 
                         FIRST SUPPLEMENT TO PROSPECTUS
 
                             GREYHOUND LINES, INC.
      2,400,000 SHARES OF 8 1/2% CONVERTIBLE EXCHANGEABLE PREFERRED STOCK
                             ---------------------
 
     This First Supplement to Prospectus amends and supplements the Prospectus,
dated June 30, 1997 (the "Prospectus"), of Greyhound Lines, Inc. (the "Company")
relating to the offering from time to time by certain selling stockholders (the
"Selling Securityholders") of (i) up to 2,400,000 shares (the "Shares") of
8 1/2% Convertible Exchangeable Preferred Stock, liquidation preference $25.00
per share (the "Preferred Stock"), of Greyhound Lines, Inc. (the "Company"),
(ii) up to $60.0 million aggregate principal amount of 8 1/2% Convertible
Subordinated Notes due 2009 (the "Exchange Debentures") of the Company, issuable
upon exchange of the Preferred Stock and (iii) up to 12,307,692 shares (subject
to adjustment) of Common Stock, par value $.01 per share (the "Common Stock"),
of the Company, issuable upon conversion of the Preferred Stock or the Exchange
Debentures.
 
CHANGE IN SELLING SECURITYHOLDER INFORMATION
 
     The following table sets forth the name of each Selling Securityholder and
the relationship, if any, of each Selling Securityholder with the Company and
(i) the number of shares of Preferred Stock owned by each Selling Securityholder
(assuming no shares have been sold since the date on which such securityholder
provided such information to the Company) and (ii) the number of shares of
Preferred Stock which may be offered for the account of such Selling
Securityholder under this Prospectus.
 


                                             NUMBER OF          NUMBER OF
                                             SHARES OF          SHARES OF
                                          PREFERRED STOCK    PREFERRED STOCK
     NAME OF SELLING SECURITYHOLDER            OWNED         OFFERED HEREBY
     ------------------------------       ---------------    ---------------
                                                       
Snyder Capital Management(1)............       606,500            606,500
Shepherd Investments International
  Ltd...................................       212,500            212,500
Stark International.....................       212,500            212,500
Camden Asset Management LP..............        80,000             80,000
Primerica Life Insurance Company........        61,000             61,000
The Travelers Indemnity Company.........        61,000             61,000
Bear Stearns Security Corp.(2)..........        65,300             65,300
Delaware Group Dividend and Income Fund,
  Inc...................................        53,500             53,500
Millennium Trading Co. L.P..............        45,000             45,000
JMG Capital Partners L.P................        40,000             40,000
BTR Capital Management, Inc.............        30,000             30,000
Delaware Group Global Dividend and
  Income Fund, Inc......................        26,500             26,500
Gulf Insurance Company..................        26,500             26,500
KA Trading L.P..........................        26,400             26,400
GP2 Trading.............................        25,000             25,000
Fortis Benefits Insurance Company.......        20,000             20,000
Baird, Patrick & Co. Inc................        17,500             17,500
The Travelers Insurance Company.........        15,000             15,000
Triton Capital Investments..............        15,000             15,000
KA Management Limited...................        13,600             13,600
National Benefit Life Insurance
  Company...............................        13,600             13,600
Swiss Bank Corporation (London).........        12,000             12,000
Mega Life & Health Insurance............        10,000             10,000
Palladin Partners, L.P..................         8,000              8,000
Colonial Penn Life Insurance Co.........         8,000              8,000
Colonial Penn Insurance Co..............         8,000              8,000
Glen Eagles Fund Ltd....................         8,000              8,000
Ramius Fund, Ltd........................         8,000              8,000
Maxwell Gluck Foundation................         8,000              8,000
American Health & Life Insurance Company
  of Maryland...........................         6,500              6,500
South Ferry #2, L.P.....................         6,200              6,200
Chesed Congregation.....................         2,000              2,000
Strategic Restructuring Fund............         1,000              1,000
Mirala Investments......................         1,000              1,000
Hempshire Associates....................         1,000              1,000
Andy Warhol Foundation..................           800                800
RBC Dominion Securities Inc.(3).........           350                350
                                             ---------          ---------
          Subtotal......................     1,755,250          1,755,250
Unnamed holders of Preferred Stock or
  any future transferees, pledgees,
  donees or successors of or from such
  unnamed holders(4)....................       644,750            644,750
                                             ---------          ---------
          Total.........................     2,400,000          2,400,000
                                             =========          =========

 
      THE DATE OF THIS FIRST SUPPLEMENT TO PROSPECTUS IS SEPTEMBER 5, 1997
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(1) Represents shares beneficially owned by the following accounts for which
    Snyder Capital Management acts as investment advisor: CBBB Cotenancy (6,200
    shares); East Bay Community Foundation (6,200 shares); East Oakland Youth
    Development Foundation (3,800 shares); Horowitz Limited Partnership I (3,600
    shares); Donald G. Linker, M.D. (700 shares); Albert L. Luce, Jr. (3,400
    shares); Melinda E. Maxfield Trust (900 shares); John Robert Maytag (3,300
    shares); Radiology Group of New Brunswick Pension Plan (1,700 shares);
    Radiology Group of New Brunswick Profit Sharing Plan (1,800 shares); OS
    Ventures (2,900 shares); Radiology Associates Employee Benefit Plan, Little
    Rock (5,700 shares); Ridgeway/Floum Profit Sharing Plans (3,000 shares);
    Christine Russell Revocable Trust (11,500 shares); Jeffrey Rymer (800
    shares); Milton J. Schwartz Revocable Family Trust (2,700 shares); Stirling
    Partners (30,100 shares); Stoel Rives Boley Jones & Grey (9,000 shares);
    Clorox Co. Foundation (3,300 shares); Corlon Associates, I (8,900 shares);
    S&J Partners (2,900 shares); American Stores Retirement Portfolio (29,600
    shares); Associated Jewish Charities of Baltimore (8,600 shares); Barbara K.
    Brown, Trustee of Trust A (3,500 shares); Clorox Co. Employee Benefits
    (10,000 shares); Cowles Investment Partnership (4,400 shares); Southwest
    Franciscan Missions, Inc. (3,600 shares); Guide Dogs for the Blind (12,300
    shares); N.B. Giustina Trust (4,100 shares); The Trustees of Hamilton
    College (20,600 shares); Jicarilla Apache Tribe (41,800 shares); Peyton
    Anderson Foundation (6,200 shares); Radiology Medical Group Profit
    Sharing -- San Diego (1,100 shares); Western Cancer Center Medical Group P/S
    (1,500 shares); Riverside Church (16,200 shares); Ronald Family Trust A
    (22,200 shares); Zellerbach Family Fund (5,700 shares); University of Oregon
    Foundation (5,900 shares); Michigan State University (9,500 shares);
    Metropolitan Museum of Art (19,200 shares); Cheyne Walk Trust (17,400
    shares); James Irvine Foundation (22,600 shares); The Henry J. Kaiser Family
    Foundation (13,800 shares); Citibank, et al. Employees Retirement Plan
    (74,600 shares); Duke University Employees R.P. (5,000 shares); Duke
    University Long Term Pool (24,700 shares); Alsam Foundation (3,700 shares);
    JMB Children's Holding Co. (14,700 shares); S.C. Johnson Retirement Plan
    (6,100 shares); Southern Methodist University (6,100 shares); University of
    North Carolina at Chapel Hill Investment Fund (12,800 shares); University of
    Washington Endowment Fund (9,500 shares); Discovery Group of Funds (6,700
    shares); Skaggs Family Foundation (2,800 shares); Glaxo Welcome Benefits
    Plan (16,500 shares); Cogen Technologies Financial Partnership (8,600
    shares); Indiana University Foundation (13,000 shares); Beth Israel
    Deaconess Medical Center R.P. (1,900 shares); BTC Partners, LLP (7,600
    shares).
 
(2) Bear, Stearns & Co. Inc., an affiliate of Bear Stearns Securities Corp.,
    acted as initial purchaser for the Offerings and has performed other
    investment services for the Company for which it has received customary
    fees.
 
(3) Represents shares held for the account of Mrs. Rhoda Lindzon.
 
(4) No such holder may offer Preferred Stock pursuant to this Prospectus until
    such holder is included as a Selling Securityholder in a supplement to this
    Prospectus.