<ARTICLE>                                           7
<LEGEND>
     THIS SCHEDULE  CONTAINS SUMMARY  FINANCIAL  INFORMATION  EXTRACTED FROM THE
QUARTERLY  PERIOD ENDED  SEPTEMBER  30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK>                         0000225648
<NAME>                        DANIELSON HOLDING CORPORATION
<MULTIPLIER>                                   1,000
       
                             
<PERIOD-TYPE>                   9-MOS
<FISCAL-YEAR-END>                              DEC-31-1996
<PERIOD-START>                                 JAN-01-1996
<PERIOD-END>                                   SEP-30-1996
<DEBT-HELD-FOR-SALE>                           147,703
<DEBT-CARRYING-VALUE>                          0
<DEBT-MARKET-VALUE>                            0
<EQUITIES>                                     561
<MORTGAGE>                                     0
<REAL-ESTATE>                                  0
<TOTAL-INVEST>                                 150,454
<CASH>                                         900
<RECOVER-REINSURE>                             25,598<F1>
<DEFERRED-ACQUISITION>                         904
<TOTAL-ASSETS>                                 196,974
<POLICY-LOSSES>                                114,946
<UNEARNED-PREMIUMS>                            8,150
<POLICY-OTHER>                                 0
<POLICY-HOLDER-FUNDS>                          4,561
<NOTES-PAYABLE>                                0
<PREFERRED-MANDATORY>                          0
<PREFERRED>                                    0
<COMMON>                                       1,537
<OTHER-SE>                                     59,178<F2>
<TOTAL-LIABILITY-AND-EQUITY>                   196,974
<PREMIUMS>                                     26,900
<INVESTMENT-INCOME>                            8,083
<INVESTMENT-GAINS>                             66
<OTHER-INCOME>                                 710
<BENEFITS>                                     19,992
<UNDERWRITING-AMORTIZATION>                    4,682
<UNDERWRITING-OTHER>                           11,997<F3>
<INCOME-PRETAX>                                (1,000)
<INCOME-TAX>                                   36
<INCOME-CONTINUING>                            (1,036)
<DISCONTINUED>                                 (1,905)<F4>
<EXTRAORDINARY>                                0
<CHANGES>                                      0
<NET-INCOME>                                   (2,941)
<EPS-PRIMARY>                                  (0.19)
<EPS-DILUTED>                                  (0.19)
<RESERVE-OPEN>                                 116,294
<PROVISION-CURRENT>                            19,992
<PROVISION-PRIOR>                              0
<PAYMENTS-CURRENT>                             7,193
<PAYMENTS-PRIOR>                               37,458
<RESERVE-CLOSE>                                92,486<F5>
<CUMULATIVE-DEFICIENCY>                        (3,123)
<FN> 
<F1> Included in this caption are reinsurance recoverables on unpaid losses
of 22,460 and reinsurance recoverables on paid losses of 3,138. 
<F2> Included in Stockholders' Equity-Other is treasury stock of 66.
<F3>  Included in this caption are expenses in connection  with  terminated
proposed acquisition of 1,849 and nonrecurring  compensation of 1,272. 
<F4> Lossfrom discontinued  operations is comprised of loss from operations
of 243 and loss on disposal of the segment of 1,662.
<F5> Includes reserves of 851 of Valor Insurance Co. which
was acquired on June 24, 1996.
</FN>