EXHIBIT (13b-1)



REPORT OF INDEPENDENT AUDITORS



The Board of Directors and Shareholders of Unifi, Inc.

          We have audited the accompanying consolidated balance
sheets of Unifi, Inc. as of June 30, 1996, and June 25, 1995, and
the related consolidated statements of income, changes in
shareholders' equity, and cash flows for each of the three years
in the period ended June 30, 1996.  These financial statements
are the responsibility of the Company's management.  Our
responsibility is to express an opinion on these financial
statements based on our audits.

          We conducted our audits in accordance with generally
accepted auditing standards.  Those standards require that we
plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting
principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. 
We believe that our audits provide a reasonable basis for our
opinion.

          In our opinion the financial statements referred to
above present fairly, in all material respects, the consolidated
financial position of Unifi, Inc. at June 30, 1996, and June 25,
1995, and the consolidated results of its operations and its cash
flows for each of the three years in the period ended June 30,
1996, in conformity with generally accepted accounting
principles.

ERNST & YOUNG LLP

Greensboro, North Carolina
July 16, 1996



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