SecProbe.io

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Luby's, Inc.

13111 Northwest Freeway
Suite 600
Houston, Texas 77040
(713) 329-6800
Toll-Free (877) 570-7500

                                  April 8, 2005

United States Securities and Exchange Commission
450 Fifth Street N. W.
Washington D.C. 20549

          Attention: Ms. Linda Cvrkel
                     Branch Chief

Ladies and Gentlemen:

     Set forth below are the responses of Luby's, Inc. (the "Company") to the
comments of the Staff with respect to the Company's Annual Report on Form 10-K
for the fiscal year ended August 25, 2004, Form 10-Q for the quarterly period
ended November 17, 2004, and related matters contained in a letter from Linda
Cvrkel to Ernest Pekmezaris, Chief Financial Officer of the Company, dated March
28, 2005.

     For ease of reference, we have set forth the Company's responses in bold
type and have also set forth each comment before the related response. The
comments are numbered to correspond to the comment number of Ms. Cvrkel's
comment letter. The heading references refer to the headings in Ms. Cvrkel's
comment letter.

     The Company has recently amended its Form 10-K for the fiscal year ended
August 25, 2004 and its Form 10-Q for the fiscal quarter ended November 17, 2004
to correct many of the issues raised in Ms. Cvrkel's letter.

Form 10-K for the Fiscal Year Ended August 25, 2004
---------------------------------------------------

Item 7: Management's Discussion and Analysis of Financial Condition and Results
-------------------------------------------------------------------------------
of Operations
-------------

EBITDA
------

                                       1
<PAGE>

     1.   We note your presentation of the non-GAAP measure, EBITDA. You state
          that you present this measure because you believe it is useful as an
          operating performance measure. Item 10(e) of Regulation S-K prohibits
          excluding charges or liabilities that require cash settlement or
          excluding items that are reasonably expected to recur within two years
          or had similar charges in the prior two years. It appears from your
          discussion that you use an Adjusted EBITDA measure as defined by your
          debt agreements. In this regard, you can present such measure to the
          extent you provide a discussion indicating the materiality of the
          covenant and agreement, the amount or limit required for compliance
          with the covenant, and the actual or reasonably likely effects of
          compliance or noncompliance with the covenant on your financial
          condition, results of operations and liquidity. Please revise your
          presentation of EBITDA accordingly. Refer to the guidance provided in
          our release titled "Frequently Asked Questions Regarding the Use of
          Non-GAAP Financial Measures", specifically question 10.

RESPONSE: In future filings, the Company intends to continue to include a
presentation of EBITDA, but will include the following discussion in connection
with its presentation: EBITDA, as defined identically in both the senior line of
credit and term loan debt agreements, is the denominator used in determining all
of the financial covenant ratios that are measured against predefined limits for
compliance under those agreements. (See Note 7 to the Company's consolidated
financial statements). Noncompliance with any of the financial covenants would
constitute an event of default under both agreements, requiring the Company to
obtain replacement financing to repay amounts owed under these agreements and to
meet future working capital requirements. Management believes that such
replacement financing would be available and that the cost of such financing
would not have a significant effect on the Company's liquidity or results of
operations.

Liquidity and Capital Resources
-------------------------------

     2.   In lieu of the fact that you have currently identified 26 restaurants
          as held for sale, in accordance with your previously announced
          business plan, please expand to discuss the anticipated effect of the
          sales of these restaurants on your future results of operations and
          liquidity.

RESPONSE: In future filings, the Company shall add the following language, as
applicable, to its discussion: When sold, proceeds from property that have been
identified as held for sale, shall be used to reduce outstanding debt. All
property held for sale consists of already-closed restaurant properties.
Property held for sale is valued at the lower of net depreciable value or net
realizable value. The Company's results of operations will be affected to the
extent proceeds from the sale of these assets exceed or are less than net book
value.

Financial Statements
--------------------

Consolidated Statements of Operations
-------------------------------------

                                       2
<PAGE>

     3.   Rule 5-03(b)(3) of Regulation S-X requires that any material operating
          costs and expenses that are not captured under the classification of
          costs and expenses applicable to sales and revenues be separately
          stated. Please tell us supplementally why you believe it is
          appropriate to present on a combined basis occupancy costs and other
          operating expenses. It appears that occupancy costs would be
          significant enough to be separately stated. Also, consider separately
          stating other costs included within other operating expenses based
          upon their significance. Please revise or advise.

RESPONSE: Occupancy costs (i.e. rent, common area maintenance, property taxes,
and property tax services) currently reported within occupancy and other
expenses, are less than 5% of revenues and therefore, are not considered
significant enough to require being separately stated. Further, included in
occupancy and other operating expenses are several items (occupancy,
advertising, insurance, managers' incentive compensation, etc.) each of which
historically may be material in certain periods, but not consistently across all
periods. Consequently, the Company combines these items for consistency of
presentation. The Company believes that its current presentation is consistent
with other restaurant company registrants.

     4.   Based upon your MD & A discussion, it appears that you have included
          gains on the sales of assets within "Other income, net" on your
          Consolidated Statements of Operations. Gains and losses recognized on
          the sale of long-lived assets that are not a component of an entity
          should be included in income from continuing operations. Please
          reclassify your gains and losses recognized on the sale of long-lived
          assets, accordingly. Refer to the guidance in Paragraph 45 of SFAS
          144.

RESPONSE: Prior to adopting SFAS 144 in fiscal year 2003, the Company initiated
disposal activities for several stores ("pre-144 stores") and accounted for
these disposal activities in accordance with SFAS 121. As such, the pre-144
stores were classified as property held for sale. Applicable impairments were
charged to, and subsequent gains on disposals (to the extent of previously
recognized impairments) were credited against, "Provision for asset impairments
and restaurant closings." Gains in excess of impairments were classified as
non-operating and included in "Other income, net." Under the transition guidance
provided in Paragraph 51 of SFAS 144, "...long-lived assets classified as held
for disposal as a result of disposal activities that were initiated prior to
this Statement's initial application shall continue to be accounted for in
accordance with the prior pronouncement." Accordingly, gains on asset sales
reflected in "Other income, net" represent gains in excess of impairments
recognized for the pre-144 stores, in accordance with SFAS 121. The Company will
review its MD & A discussion to ensure that these concepts are adequately
described, to the extent they are relevant to the MD & A discussion as a whole.

Consolidated Statements of Cash Flows
-------------------------------------

     5.   Revise to present purchases of short-term investments and
          redemptions/proceeds from short-term investments separately within
          investing activities or tell us why these investments qualify for net
          reporting under paragraph13 of SFAS 95. Refer to the guidance in
          Paragraph 18 of SFAS 95.

                                       3
<PAGE>

RESPONSE: On a prospective basis, the Company intends to revise its Consolidated
Statements of Cash Flows in future filings to present purchases of short-term
investments and redemption/proceeds from short-term investments separately
within investing activities.

Notes to Consolidated Financial Statements
------------------------------------------
Note 1: Nature of Operations and Significant Accounting Policies
----------------------------------------------------------------
-Self-Insurance Accruals
------------------------

     6.   We note from your disclosure in MD&A that you revised the method used
          to estimate your workers' compensation and employee claims reserve. It
          appears that the change in methodology of developing these estimates
          resulted from the use of more comparable Texas nonsubscriber work
          injury loss history by your actuary. We further note from footnote 16
          that you increased your accrual for estimated workers' compensation
          and employee injury costs by $1 million in the fourth quarter of 2004.
          Tell us supplementally and disclose your policy for recognizing
          liabilities for workers' compensation and employee injury claims prior
          to and subsequent to adopting your new methodology. Also, revise to
          clearly discuss in your critical accounting policies section of MD&A
          the significant assumptions and estimates used in your methodology to
          determine your liability for incurred claims, both reported and not
          reported.

RESPONSE: As reported in prior filings, in 2001, the Company chose to exit the
Texas Worker's Compensation Insurance Program, and instead, administer its own
private employee injury plan, which it is free to do in Texas. Prior to 2004,
the Company recognized its estimated liability based upon estimates provided in
part by its internal Risk Management personnel, and in part by its third-party
actuary. The Company did this due to the fact that it did not wish to rely
wholly on the actuarial data, since such data used the Company's claims history
from the period prior to departure from the Texas Worker's Compensation program.
After its third-party actuary started utilizing data from more comparable Texas
Non-subscriber employee injuries, the Company increased its reliance on the
third-party actuarial data in estimating its liability.

In future filings, the Company shall prospectively add the following to its
discussion of Critical Accounting Policies Related to Insurance Accruals to
clarify assumptions and estimates used in the Company's methodology to determine
the estimated liability for incurred claims, both reported and not yet reported:
Accrued liabilities have been recorded based upon analysis of historical data
and actuarial estimates, and is reviewed by the Company on a quarterly basis to
ensure that the liability is appropriate.

                                       4
<PAGE>

-Depreciation and Amortization
------------------------------

     7.   You state that leasehold improvements are amortized over the related
          lease lives, which are in some cases shorter than the estimated useful
          lives of the improvements. This appears to imply that you amortize the
          cost of leasehold improvements over the term of the lease, even in
          cases in which the lease term is longer than the estimated useful life
          of the improvement. Leasehold improvements should be amortized over
          the shorter of the lease term as defined in paragraph 5 (f) of SFAS 13
          or their estimated useful life. If you amortize your leasehold
          improvements over the shorter of the improvement's estimated useful
          life and the term of the lease, please revise your policy to state
          this fact; otherwise, please tell us supplementally how your current
          policy is in accordance with GAAP. Refer to guidance in SFAS 13.

RESPONSE: The Company has changed the wording of its leasehold depreciation
policy. The restated 10 K/A shows the correct wording on page 31 under the
paragraph labeled "Depreciation and Amortization" as follows: "The Company
depreciates the cost of plant and equipment over their estimated useful lives
using the straight-line method. Leasehold improvements are amortized over the
lesser of their estimated useful lives or the related lease lives. Depreciation
of buildings is provided on a straight-line basis over the estimated useful
lives (generally 20 to 33 years, not to exceed 25 years for buildings located on
leased properties.)" The Company believes its revised policy is in accordance
with GAAP.

Note 6: Debt
------------

-Subordinated Notes
-------------------

     8.   We note that the terms of your convertible subordinated notes which
          had been issued to your CEO, Christopher J. Pappas, and COO, Harris J.
          Pappas, were amended in the fourth quarter of 2004. The amendment
          changed the related interest rate from LIBOR plus 2.0% to prime plus
          5.0% or 4.0%, depending upon the amount of senior debt outstanding.
          You state that the modification of the notes resulted in the net
          effect of $125,000 financial benefit in the fourth quarter of fiscal
          2004. Tell us supplementally, in detail, how you accounted for the
          modification of the convertible subordinated notes under GAAP. We may
          have further comment based upon your response.

RESPONSE: Per the Emerging Issues Task Force (EITF) No. 96-19, the modification
of the convertible subordinated notes qualifies as an extinguishment of debt for
accounting purposes. As such, the $125,000 net financial benefit recognized was
the result of a $1,135,000 acceleration of the unamortized discount on the
original debt, offset by a gain on the extinguishment resulting from the
allocation of a portion ($1,260,000) of the proceeds from the new convertible
securities to additional paid in capital. This allocation, based on guidance
from EITF No. 98-5, represented the repurchase of the old beneficial conversion
feature, which was "in the money" at the commitment date.

                                       5
<PAGE>

     9.   In regards to the amended subordinated note agreements, tell us
          supplementally why you reflected in your Statements of Shareholders'
          Equity a "net change in value of beneficial conversion feature on the
          convertible subordinated notes" of $6.9 million when you disclose that
          the beneficial conversion feature was $8.2 million. We note that the
          beneficial conversion feature recorded on the original issuance of the
          subordinated notes was $4.7 million. Also, tell us and revise to
          disclose the convertible features of the notes, specifically when the
          notes are convertible by the holder. We may have further comment based
          on your response.

RESPONSE: As discussed in Note 6 and supplemented by the Company's response to
Comment #8 above, the $6.9 million change reflected in the Consolidated
Statement of Shareholders' Equity represents the intrinsic value of the new $8.2
million beneficial conversion feature, net of the $1.3 million allocated under
EI