SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 20549


                        _________________________________


                                    FORM 8-K

                                 CURRENT REPORT

                     PURSUANT TO SECTION 13 OR 15(d) OF THE

                         SECURITIES EXCHANGE ACT OF 1934


                Date of earliest event reported: October 23, 1996


                        PEOPLES TELEPHONE COMPANY, INC. 
             (Exact name of registrant as specified in its charter)


       NEW YORK                    0-16479                   13-2626435   
(State or other juris-          (Commission File            (IRS Employer
diction of incorporation)            Number)                   I.D. No.)


                   2300 N.W. 89th Place, Miami, Florida 33172 
               (Address of principal executive office) (Zip Code)


Registrant's telephone number, including area code: (305) 593-9667






Item 5.        Other Events
 
     The  Company on October 23, 1996  announced  that its common  stock will be
quoted on the Nasdaq  SmallCap  Market rather than the Nasdaq  National  Market,
effective immediately. The Company has been deemed by Nasdaq not to have met the
minimum net tangible asset  requirement of the National Market since the quarter
ending  March 31,  1996.  The Company  has,  however,  been  granted a temporary
exception to the SmallCap Market capital and surplus requirement, subject to the
removal of the  mandatory  redemption  provision  of its $15 million  Cumulative
Convertible  Preferred  Stock.  The  removal of this  provision  will enable the
Cumulative  Convertible  Preferred  Stock  to  be  treated  as  equity  from  an
accounting  standpoint.  The Company is also  required to submit  certain  stock
options (granted during 1991 through 1995) for shareholder  approval at its next
annual  shareholders  meeting.  While there can be no assurance that the Company
will be able  to  satisfy  these  conditions,  the  Company  believes  that  the
conditions can be met. Toward this end, the Company is currently in negotiations
with the holder of its Cumulative Convertible Preferred Stock in connection with
the  removal of the  mandatory  redemption  provision.  For the  duration of the
temporary exception, the Company's Nasdaq symbol will be PTELC.




                                          SIGNATURES


     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. PEOPLES TELEPHONE COMPANY, INC.


Date: October 24, 1996                   /s/ Bonnie S. Biumi                  
                                         Bonnie S. Biumi
                                         Chief Financial Officer