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



                         DATE OF REPORT:  MARCH 4, 1997
                        (DATE OF EARLIEST EVENT REPORTED)


                             -----------------------


                           FEDERAL EXPRESS CORPORATION
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)




                                    DELAWARE
                            (STATE OF INCORPORATION)


         1-7806                                           71-0427007
(COMMISSION FILE NUMBER)                       (IRS EMPLOYER IDENTIFICATION NO.)



                 2005 CORPORATE AVENUE, MEMPHIS, TENNESSEE 38132
                    (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)



               REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:
                                 (901) 369-3600



ITEM 5.  OTHER EVENTS

     In its Current Reports on Form 8-K dated April 30, 1996, June 7, 1996 and
August 16, 1996, Federal Express Corporation (the "Company" and the
"Registrant") reported the filing by customers of the Company of four separate
class-action lawsuits generally alleging that the Company has breached its
contract with the plaintiffs in transporting packages shipped by them by
continuing to collect a 6.25% federal excise tax on the transportation of
property shipped by air after the tax expired on December 31, 1995, and until it
was reinstated in August of 1996.  Three of those cases were consolidated in
Minnesota Federal District Court.  That court has currently stayed the
consolidated cases in favor of a case filed in state court in Alabama which has
been removed to Federal District Court in Alabama.

     A new class-action lawsuit was filed against the Company on March 4, 1997
in the Supreme Court of New York.  The lawsuit was officially served on the
Company's agent for service of process on April 11 and received by the Company
on April 16.  In the lawsuit, the plaintiff alleges that the Company continued
to collect the 6.25% federal excise tax on the transportation of property
shipped by air after the tax expired on December 31, 1996.  The lawsuit alleges
fraud, violation of New York's deceptive business practices statute, unjust
enrichment, and conversion.  The plaintiff seeks certification as a class
action, damages (including treble damages under one count of the complaint) and
an award of attorneys fees and costs.

     The air transportation excise tax expired on December 31, 1995, was
reenacted by Congress effective August 27, 1996, and expired again on
December 31, 1996.  The excise tax was then reenacted by Congress effective
March 7, 1997, and is scheduled to expire on September 30, 1997.  The expiration
of the tax relieved the Company of its obligation to pay the tax during the
periods of its expiration. 

     The Company intends to vigorously defend itself in these cases.  No amount
has been reserved for these contingencies.


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                                    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 hereunto duly authorized.


                                        FEDERAL EXPRESS CORPORATION



                                        By:  /s/ Michael W. Hillard
                                            -------------------------------
                                             Michael W. Hillard
                                             Vice President & Controller
                                             (PRINCIPAL ACCOUNTING OFFICER)



Dated:  April 21, 1997


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