(212) 455-2000




                                                                January 12, 2000




Dillard Asset Funding Company
c/o Chase Manhattan Bank Delaware
1202 Market Street
Wilmington, DE  19801

                       Re:    Dillard Credit Card Master Trust
                              Asset-Backed Certificates

Ladies and Gentlemen:

         We have acted as counsel for Dillard Asset Funding Company, a Delaware
business trust (the "Company") and Dillard National Bank, a national banking
association ("DNB") in connection with the filing by the Company, on behalf of
the Dillard Credit Card Master Trust (the "Master Trust"), with the Securities
and Exchange Commission under the Securities Act of 1933, as amended, of a
Registration Statement on Form S-3, Registration No. 333-67855 (the
"Registration Statement"), registering asset-backed certificates representing
undivided interests in certain assets of the Master Trust (the "Certificates").
The Certificates of a particular series will be issued pursuant to an Amended
and Restated Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement") between the Company, DNB as Servicer (the "Servicer") and The Chase
Manhattan Bank, as Trustee (the "Trustee"), substantially in the form filed as
Exhibit 4.1 to the Registration Statement, and a related Series Supplement to
the Pooling and Servicing Agreement (a "Series Supplement") between the Company,
the Servicer and the Trustee, substantially in the form filed as Exhibit 4.2 to
the Registration Statement.

         We have examined the Registration Statement, the form of Pooling and
Servicing Agreement and the form of Series Supplement. We also have examined the
originals, or duplicates or certified or conformed copies, of such records,
agreements, instruments and other documents and have made such other and further
investigations as we have deemed relevant and necessary in connection with the
opinions expressed herein. As to








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questions of fact material to this opinion, we have relied upon certificates of
public officials and of officers and representatives of the Company and DNB.

         In rendering the opinions set forth below, we have assumed the
genuineness of all signatures, the legal capacity of natural persons, the
authenticity of all documents submitted to us as originals, the conformity to
original documents of all documents submitted to us as duplicates or certified
or conformed copies, and the authenticity of the originals of such latter
documents.

         Based upon the foregoing, and subject to the qualifications and
limitations set forth herein, we are of the opinion that:

         1.          When the Pooling and Servicing Agreement has been duly
         authorized, executed and delivered by each of the Company and DNB and
         the Trustee, such Pooling and Servicing Agreement will constitute a
         binding obligation of the Company and DNB.

         2.          When the Series Supplement relating to a particular series
         of Certificates has been duly authorized, executed and delivered by
         each of the Company and DNB and the Trustee, such Series Supplement
         will constitute a binding obligation of the Company and DNB.

         3.          When the Certificates of a particular series have been duly
         authorized by the Company, when such Certificates have been duly
         executed and authenticated in accordance with the terms of the Pooling
         and Servicing Agreement and the related Series Supplement and when such
         Certificates have been delivered and sold as contemplated by the
         Registration Statement, such Certificates will be validly issued, fully
         paid and nonassessable and outstanding and entitled to the benefits
         provided for by the Pooling and Servicing Agreement and such Series
         Supplement.

         Our opinions set forth above in paragraphs 1 and 2 are subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally and general equitable principles (whether considered in a proceeding
in equity or at law).


         The statements set forth in the Prospectus included in the Registration
Statement (the "Prospectus") under the caption "Federal Income Tax Consequences"
insofar as they purport to constitute summaries of matters of United States
federal income tax law and regulations or legal conclusions with respect
thereto, constitute accurate summaries of the matters described therein in all
material respects. We hereby confirm and adopt as our opinion as to the material
federal income tax consequences of the purchase, ownership and disposition of









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the certificates that which is stated as our opinion under the caption
"Federal Income Tax Consequences" in the Prospectus.


         We are members of the Bar of the State of New York, and we do not
express any opinion herein concerning any law other than the law of the State of
New York and the Federal law of the United States.

         We hereby consent to the filing of this opinion letter as Exhibit 5.1
and Exhibit 8.1 to the Registration Statement and the use of our name under the
captions "Legal Matters" and "Federal Income Tax Consequences" in the
Prospectus.


                                             Very truly yours,

                                             /s/ Simpson Thacher & Bartlett

                                             SIMPSON THACHER & BARTLETT