8-K

                       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 (Date of earliest event reported): September 24, 2004

                             PRIME HOSPITALITY CORP.
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             (Exact name of registrant as specified in its charter)

                                                       
           Delaware                       1-6869                 22-2640625
(State or other jurisdiction     (Commission File Number)      (IRS Employer
      of incorporation)                                      Identification No.)



              700 Route 46 East, Fairfield, New Jersey 07004
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                  Address of principal executive offices

       Registrant's telephone number, including area code: (973) 882-1010

                                       N/A
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         (Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):

      [ ]   Written communications pursuant to Rule 425 under the Securities Act
            (17 CFR 230.425)

      [ ]   Soliciting material pursuant to Rule 14a-12 under the Exchange Act
            (17 CFR 240.14a-12)

      [ ]   Pre-commencement communications pursuant to Rule 14d-2(b) under the
            Exchange Act (17 CFR 240.14d-2(b))

      [ ]   Pre-commencement communications pursuant to Rule 13e-4(c) under the
            Exchange Act (17 CFR 240.13e-4(c))

      Item 8.01. Other Events.

      On September 24, 2004, Prime Hospitality Corp. ("Prime") announced that it
and the other defendants have entered into a memorandum of understanding to
settle the purported class action litigation brought in connection with the
acquisition of Prime by an affiliate of The Blackstone Group. In connection
with the settlement, Prime will be mailing to its stockholders a proxy statement
supplement that includes certain additional disclosures. A copy of the press
release issued by Prime on September 24, 2004, announcing the entering of a
memorandum of understanding is attached hereto as Exhibit 99.1 and is
incorporated herein by this reference.

      Item 9.01. Financial Statements and Exhibits.

      (c)   Exhibits



            Exhibit No.   Exhibits
            -----------   --------
                       
            99.1          Press Release of Prime Hospitality Corp. dated
                          September 24, 2004.



                                    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.


                                    PRIME HOSPITALITY CORP.

Date:  September 24, 2004           By: /s/ Richard T. Szymanski
                                        ---------------------------------------
                                        Name:  Richard T. Szymanski
                                        Title: Senior Vice President and
                                               Chief Financial Officer

EX-99.1

                                                                    EXHIBIT 99.1

PRESS RELEASE

            PRIME HOSPITALITY ENTERS INTO MEMORANDUM OF UNDERSTANDING
                        TO SETTLE STOCKHOLDER LITIGATION

Fairfield, New Jersey - September 24, 2004 - Prime Hospitality Corp. (the
"Company") announced today that the Company and the other defendants have
entered into a memorandum of understanding to settle the purported class action
litigation brought in connection with the Company's acquisition by BREP IV
Hotels Holding L.L.C., an affiliate of The Blackstone Group ("Blackstone"). The
litigation was brought in the Court of Chancery of the State of Delaware, New
Castle County, against the Company, the Company's directors and Blackstone.

The settlement will not affect the amount of merger consideration to be paid in
the merger or any other terms of the merger.

In connection with the settlement, the Company has agreed to make certain
additional disclosures to its stockholders, which will be included in a proxy
statement supplement that will be mailed to stockholders of the Company. Subject
to the completion of certain confirmatory discovery by counsel to the
plaintiffs, the memorandum of understanding contemplates that the parties will
enter into a settlement agreement. The settlement agreement will be subject to
customary conditions including court approval following notice to the
stockholders of the Company and consummation of the merger. In the event that
the parties enter into a settlement agreement, a hearing will be scheduled at
which the court will consider the fairness, reasonableness and adequacy of the
settlement which, if finally approved by the court, will resolve all of the
claims that were or could have been brought in the actions being settled,
including all claims relating to the merger, the merger agreement and any
disclosure made in connection therewith.

The defendants deny the allegations made in the purported class action
litigation and have agreed to settle the litigation to avoid the burden and
expense of further litigation and to avoid the risk of delaying the merger.

About Prime Hospitality Corp.

Prime Hospitality Corp., one of the nation's premiere lodging companies, owns,
manages, develops and franchises more than 250 hotels throughout North America.
The Company owns and operates three proprietary brands, AmeriSuites(R) (all
suites), PRIME Hotels & Resorts(R) (full-service) and Wellesley Inns & Suites(R)
(limited service). Also within Prime's portfolio are owned and/or managed hotels
operated under franchise agreements with national hotel chains including Hilton,
Sheraton, Hampton, and Holiday Inn. Prime can be accessed over the Internet at
http://www.primehospitality.com.

About The Blackstone Group

The Blackstone Group, a private investment firm with offices in New York, London
and Hamburg, was founded in 1985. Blackstone's Real Estate Group has raised five
funds, representing over $6 billion in total equity, and has a long track record
of investing in hotels and other commercial properties. In addition to Real
Estate, The Blackstone Group's core businesses include, Private Equity,
Corporate Debt Investing, Marketable Alternative Asset Management, Mergers and
Acquisitions Advisory, and Restructuring and Reorganization Advisory. The
Blackstone Group can be accessed on the Internet at http://www.blackstone.com.

                                                                               2


Certain statements and information included in this press release constitute
"forward-looking statements" within the meaning of the Federal Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors which may cause
the actual results, performance, or achievements of the Company to be materially
different from any future results, performance or achievements expressed or
implied in such forward-looking statements. Additional discussion of factors
that could cause actual results to differ materially from management's
projections, forecasts, estimates and expectations is contained in the Company's
SEC filings.

In connection with the proposed merger, the Company has filed a proxy statement
with the Securities and Exchange Commission. INVESTORS AND SECURITY HOLDERS ARE
ADVISED TO READ THE PROXY STATEMENT BECAUSE IT CONTAINS IMPORTANT INFORMATION.
Investors and security holders may obtain a free copy of the proxy statement and
other documents filed by the Company at the Securities and Exchange Commission's
website at www.sec.gov. The proxy statement and such other documents may also be
obtained for free from the Company by directing such request to the Company,
Attention: Investor Relations, 690 Route 46 East, Fairfield, New Jersey 07004,
with a copy to the attention of the Company's Secretary and General Counsel,
Joseph B. Bernardino, Esq., or by telephone at (973) 882-1010.

The Company and its directors, executive officers and other members of its
management and employees may be deemed to be participants in the solicitation of
proxies from its shareholders in connection with the proposed merger.
Information concerning the interests of Company's participants in the
solicitation is set forth in the Company's proxy statements and Annual Reports
on Form 10-K, previously filed with the Securities and Exchange Commission, and
in the proxy statement relating to the merger.

CONTACTS:

Prime Hospitality Corp.
Rich Szymankski (973) 808-7751

The Blackstone Group
John Ford (212) 583-5559