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CORRESP
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May 31, 2005

Mr. Mike Moran

Accounting Branch Chief

Division of Corporation Finance

Mail Stop 0308

United States Securities and Exchange Commission

Washington, D.C. 20549

  RE:

  The Neiman Marcus Group, Inc.

  Form 10-K for the Fiscal Year ended July 31,
  2004

  Form 10-Q for the Quarter Ended January 29, 2005

  File No. 1-9659

Dear Mr. Moran:

Reference is made to the
letter, dated March 31, 2005 (the “Comment Letter”), from the staff (the “Staff”)
of the Division of Corporation Finance of the Securities and Exchange
Commission (the “Commission”) to The Neiman Marcus Group, Inc. (the “Company”)
regarding the Company’s Annual Report on Form 10-K for the year
ended July 31, 2004 (the “Form 10-K”) and the Company’s
Quarterly Report on Form 10-Q for the quarter ended January 29,
2005.

As the Company disclosed in its
Current Report on Form 8-K filed with the Commission on April 19,
2005, the Company is filing an amendment (the “Form 10-K/A”) to its Form 10-K
and to its Form 10-Q filings for each of the quarters ended October 30,
2004 and January 29, 2005 in order to restate its financial statements to
correct an error related to the classification of construction allowances in
its balance sheets and statement of cash flows.
In addition, the Company is also restating its statements of cash flows
to include the changes in the interests retained by the Company in connection
with its revolving credit card securitization facility in the determination of
cash flows from operating activities.
Previously, the changes in the retained interests were included in the
determination of cash flows from investing activities.

In connection with the filing
of the Form 10-K/A to reflect the restatements, the Company has
taken the opportunity in the Form 10-K/A 1) to give retroactive
application to the immaterial change in classification in the costs of its
loyalty program made as of the beginning of the first quarter of fiscal year
2005 and as previously disclosed in its Form 10-Q filings for each
of the quarters ended October 30, 2004 and January 29, 2005 and 2) to
respond to the Staff’s comments contained in the Comment Letter.  The Form

10-K/A and Form 10-Q/A for the quarter ended October 30, 2004 and Form 10-Q/A
for the quarter ended January 29, 2005 were filed with the Commission on May
31, 2005.

Set forth below are the Company’s
responses to the Staff’s comments contained in the Comment Letter.  For convenience of reference, the text of the
Staff’s comments has been reproduced in bold herein, and each of the Company’s
responses follows the text of the comment to which it relates.  Page numbers in the text of this letter
correspond to the pages of the Form 10-K/A, unless otherwise
indicated.

Form 10-K for the Year Ended July 31, 2004

General

1.                                      Unless
otherwise indicated, where a comment below requests additional disclosures or
other revisions to be made, please include the additional disclosures and revisions in your future filings.

The Company has noted those instances in which the revised disclosures
referred to herein will be included in future filings.

Item 1. Business

2.                                      Please disclose for each of the last three years the percentage or
amounts of revenues contributed by classes of your products that accounted for
10% or more of revenues in any of the last three years as required by Item 101(c)(i) of Regulation

S-K.

We will disclose revenues by merchandise category for each of the years
presented in future applicable filings and in our Form 10-K/A; see page 4
for the changes.

Item 5. Market for the Registrant’s Common Equity and
Related Shareholder Matters

3.                                      Please
include a description of the nature of stock repurchase transactions that were
not made under publicly announced repurchase plans or programs as required by
Item 703 of Regulation S-K.

All of the stock repurchase transactions were made under
publicly-announced repurchase plans or programs.  The table included in Item 5 of the Form 10-K
mistakenly included our stock repurchases of 10,450 shares during the period
commencing on July 4, 2004 and ending on July 31, 2004 only in the
first column of such table.  The 10,450
shares were repurchased as part of a publicly-announced plan and therefore
should also have been included in the third column (“Total Number of Shares
Purchased as Part of Publicly Announced Plans or Programs”) of such
table.  The table has been revised as
part of the Form 10-K/A; see page 9 for the changes.

2

Item 6. Selected Financial Data

4.                                      Please
disclose cash dividends declared per common share as required by Instruction 2
to Item 301 of Regulation S-K.

We will disclose cash dividends declared per common share in the
Selected Financial Data included in future applicable filings, as well as in
our Form 10-K/A; see page 10 for the changes.

Item 7. Management’s Discussion and Analysis of Financial
Condition and Results of Operations

Operating Results, page 12

General

5.                                      Please
include a tabular presentation of net sales revenues by product category for
the periods presented and provide a narrative discussion of the extent to which
material changes are attributable to
pricing, mix or volume of goods sold.
Please refer to SEC Release No. 33-8350 and Item 303(a)(3)(iii) of Regulation S-K.

Substantially all of our revenues are derived from the sales of luxury
goods to our affluent customer base.
While the items we sell span a variety of merchandise categories, the
mix of merchandise sold is not a significant cause of variations in the Company’s
revenues or gross margins between periods.
Should changes in merchandise mix, pricing or volume of goods sold have
a significant impact on our revenues or gross margins in future periods, we
will disclose the effects of such factors in such periods
in future applicable filings.

6.                                      In circumstances where you describe more than one business
reason for a significant change between periods in key financial data or
indicators, please quantify, to
the extent possible, the incremental
impact of each individual business reason on the overall change.  For example, in your comparison of operating results, you
should quantify, in terms of dollars, the:

•                  changes in
comparable store revenues;

The changes in comparable revenues, both in
dollars and on a percentage basis, are disclosed in the Form 10-K/A;
see pages 15 and 17 for the changes.

•                  changes in sales
attributable to stores opened and closed and excluded from comparable store
revenues;

In 2004, we opened no new stores and closed
two Neiman Marcus Galleries stores in the second
quarter.  The two Neiman Marcus Galleries
stores generated revenues of $3.4 million in 2004 prior to their closure and
$6.4 million in 2003.  Due to the
immateriality of such amounts to our consolidated revenues, we concluded that
additional disclosures were not necessary.

3

•                  changes in sales of
brand development companies;

The dollar value of sales for our Brand
Development Companies is disclosed, in the aggregate, in the revenue table on page 14
of the Form 10-K/A.  The
percentage changes in comparable revenues for both of the Brand Development
Companies are disclosed on pages 15 and 17 of the Form 10-K/A.

•                  increase in cost of sales from changes in product mix;

As stated in response to comment 5 above, we
do not believe that changes in the mix of merchandise sold in either 2004 or
2003 had a significant impact on either our revenues or gross margins in such
periods.

•                  changes in occupancy and buying costs, including payroll expenses, rent
and related occupancy expenses;

The impacts of changes in buying and
occupancy costs (including payroll, rent and related occupancy expenses) are
disclosed, as percentages of revenues, in the Form 10-K/A; see page 15
and 17 for the changes.

•                  increases and decreases in margins from changes in markdowns;

The impacts of changes in markdowns incurred,
as percentages of revenues, are disclosed in the Form 10-K/A; see page 15
and 17 for the changes.

•                  impact of changes
in vendor allowances;

The impact of the decrease in vendor
allowances, as a percentage of revenues, is disclosed in the Form 10-K/A;
see page 15 for the change.

•                  increase in depreciation expense;

The impact of the increase in depreciation
expense, as a percentage of revenues, is disclosed in the Form 10-K/A;
see page 15 for the change.

•                  reduction in pre-opening expenses; and

The impact of the reduction in pre-opening
costs, as a percentage of revenues, is disclosed in the Form 10-K/A;
see page 16 for the change.

•                  changes in
individual expenses included in selling, general and administrative expenses,
including incentive compensation and income from your credit card portfolio.

The impacts of changes in individual expenses
included in SG&A expenses (including incentive
compensation and income from our credit card portfolio) are disclosed, as
percentages of revenues, in the Form 10-K/A; see pages 16 and
18 for the changes.

4

In those circumstances where you describe and
quantify a change between periods, please also provide an analysis of the
business reasons underlying the change. For example, in your analysis you
should explain why:

•                  sales of brand
development companies increased; and

Sales of the Brand Development Companies
represented less than 3% of our consolidated revenues in each of 2004, 2003 and
2002.  We do not consider additional
disclosures to be necessary in order to understand changes in our consolidated
revenues.

•                  you recognized
an impairment charge related to the Chef’s catalog tradename
intangible asset.

Additional disclosure related to the
impairment charge is made in the Form 10-K/A; see page 16 for
the change.

7.                                      Please provide an analysis of the operating earnings of your other
operating segment for the periods presented.
In doing so, please quantify and discuss the changes in the operating
results of brand development
companies and corporate expenses.

The other category in our operating segments disclosure will be changed
to show the results of operations of our brand development companies separate
from the corporate expenses not allocated to our business segments.  These disclosures will be made in future
applicable filings and in our Form 10-K/A; see page 14 for the
changes.

As disclosed in the Form 10-K/A, the revenues of the brand
development companies represented approximately 2.4% to 2.9% of our
consolidated revenues in 2002, 2003 and 2004.
In addition, the operating earnings of the brand development companies
represented approximately 2.7% to 4.0% of our consolidated operating profits in
2002, 2003 and 2004.   In light of the
relative magnitude of the revenues and operating profits of the brand
development companies to our consolidated revenues and operating profits, we do
not believe additional analysis of the operating results of the brand
development companies would enhance the analysis of our consolidated operating
results.

As to corporate expenses, such expenses are included in selling,
general and administrative expenses in our consolidated statements of
earnings.  As a result, significant
year-over-year changes in corporate expenses are included in our discussion of
selling, general and administrative expenses in our MD&A.

Financing
Structure, page 20

8.                                      Please identify any significant covenants of your unsecured senior
notes and debentures.  Also, disclose the repercussions of not
meeting significant covenants of your credit agreement and unsecured senior
notes and debentures and the existence of any cross-default provisions.  These disclosures should also be included in
the notes to your financial statements.

5

We will provide the disclosures related to significant covenants and
events of default of our unsecured senior notes and debentures and credit
agreement and the repercussions of noncompliance with these covenants or events
of default in both MD&A and the notes to the
financial statements.  These disclosures
will be made in future applicable filings and in our Form 10-K/A;
see pages 20-21 and page F-18 for the changes.

Contractual
Obligations and Commitments, page 21

9.                                      Please
include other long-term liabilities reflected on your balance sheet.  If an obligation does not have a due date and
is excluded from the table, disclose the amount of the excluded obligation and why it is not possible to estimate a
payment date.  Please see Item 303(a)(5) of Regulation S-K.

We will address the Staff’s comments related to the inclusion of all
long-term liabilities reflected on our balance sheet in the contractual
obligations and commitments table. These disclosures will be made in future
applicable filings and in our Form 10-K/A; see page 22 for the
changes.

Critical
Accounting Policies, page 24

10.                               Please
disclose the amounts of estimates that materially affected your reported
earnings and the amounts of the related valuation allowances for each period
presented.  For example, disclose your provisions for product returns and
doubtful accounts, your estimates related to impairment of long-lived assets,
and the related valuation allowances where applicable.  Please also provide an analysis of material
changes in each of your critical accounting estimates, including changes in
depreciable lives, on revenues, operating expenses and gross profit for the
periods presented.  In addition, discuss
to the extent material how accurate your estimates and assumptions have been in
the past and whether the estimates are reasonably likely to change in the
future.  Further, provide a sensitivity
analysis of the potential impact of using different assumptions.  Please refer to SEC Release No. 33-8350.

We will address the Staff’s comments related to material estimates and
the resulting valuation allowances and reserves in the discussion of our
critical accounting policies.  These
disclosures will be made in future applicable filings and in our Form 10-K/A;
see pages 25-28 and pages F-7 to F-11 for the
changes.

As to the impact of material changes in our critical accounting
estimates, we believe that, for the periods covered by our Form 10-K,
we have complied with the provisions of SEC Release No. 33-8350
related to the disclosure of changes in accounting estimates that have had a
significant impact on our results of operations. For example, we disclosed (i) the $3.7 million tax benefit recorded in the second
quarter of 2004 as a result of conclusions of certain sales tax and unclaimed
property examinations for which the agreed-on settlements were less than the
amounts previously estimated and (ii) the $7.5 million income tax benefit
recognized in the second quarter of 2004 related to favorable settlements
associated with previous state tax filings.

6

We believe that the estimates and assumptions we have made in the past
have been materially accurate and, based on information currently known and
available, we do not believe such estimates are reasonably likely to change in
the future or that changes in such estimates will have a material impact on our
future operating results.  See pages 25 and F-7 to the Form 10-K/A for
changes.

In our 2004 Form 10-K, we provided sensitivity analysis of
the impact of significant assumptions related to our pension plan.  We will continue to make such disclosures in
future filings and to provide additional sensitivity analysis related to the
impacts of different a