SCHEDULE 14A
(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No.__________)

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
[X] Definitive Proxy Statement Commission Only (as permitted by
[ ] Definitive Additional Materials Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12

Books-A-Million, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:

[ ] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.

(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:

2
May 1, 2001

Dear Stockholder:

You are cordially invited to attend the 2001 Annual Meeting of
Stockholders of Books-A-Million, Inc., which will be held at 10:00 a.m. on
Thursday, June 7, 2001 at The Harbert Center, 2019 Fourth Avenue North,
Birmingham, Alabama 35203.

The principal business of the meeting will be (i) to elect a class of
directors to serve a three-year term expiring in 2004; (ii) to approve an
amendment to the Company's Stock Option Plan that will increase the number of
shares of Common Stock reserved for grants of options under the Plan from
3,300,000 to 3,800,000 and (iii) to ratify the appointment by the Audit
Committee of the Board of Directors of Arthur Andersen LLP to serve as the
Company's independent auditor for the fiscal year ending February 2, 2002.
During the meeting, we will also review the results of the past fiscal year and
report on significant aspects of our operations during the first quarter of
fiscal 2002.

Whether or not you plan to attend the Annual Meeting, please complete,
sign, date and return the enclosed proxy card in the postage-prepaid envelope
provided so that your shares will be voted at the meeting. If you decide to
attend the meeting, you may, of course, revoke your proxy and personally cast
your votes.

Sincerely yours,

/s/Clyde B. Anderson
Clyde B. Anderson
Chairman and Chief Executive Officer

BOOKS-A-MILLION, INC.
402 INDUSTRIAL LANE
BIRMINGHAM, ALABAMA 35211

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

(1) To elect a class of directors for a three-year term expiring
in 2004;

(2) To approve an amendment to the Company's Stock Option Plan
that will increase the number of shares of Common Stock
reserved for grants of options under the Plan from 3,300,000
to 3,800,000;

(3) To ratify the appointment by the Audit Committee of the Board
of Directors of Arthur Andersen LLP to serve as the Company's
independent auditor for the fiscal year ending February 2,
2002; and

(3) To transact such other business as may properly come before
the meeting.

The Board of Directors has fixed the close of business on April 17,
2001 as the record date for the purpose of determining the stockholders who are
entitled to notice of and to vote at the meeting and any adjournment or
postponement thereof.

By Order of the Board of Directors,

/s/Sandra B. Cochran
Sandra B. Cochran
President and Secretary

May 1, 2001
Birmingham, Alabama

IF YOU ARE UNABLE TO BE PRESENT AT THE MEETING, YOU ARE REQUESTED TO
COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD SO THAT YOUR SHARES WILL
BE REPRESENTED.

BOOKS-A-MILLION, INC.
402 INDUSTRIAL LANE
BIRMINGHAM, ALABAMA 35211

PROXY STATEMENT

This Proxy Statement is furnished by and on behalf of the Board of
Directors of Books-A-Million, Inc. (the "Company") in connection with the
solicitation of proxies for use at the Annual Meeting of Stockholders of the
Company to be held at 10:00 a.m. on Thursday, June 7, 2001 at The Harbert
Center, 2019 Fourth Avenue North, Birmingham, Alabama 35203 and at any
adjournments or postponements thereof (the "Annual Meeting"). This Proxy
Statement and the enclosed proxy card will be first mailed on or about May 1,
2001 to the Company's stockholders of record on the Record Date, as defined
below.

THE BOARD OF DIRECTORS URGES YOU TO COMPLETE, SIGN, DATE AND RETURN THE
ENCLOSED PROXY CARD IN THE POSTAGE-PREPAID ENVELOPE PROVIDED.

SHARES ENTITLED TO VOTE

Proxies will be voted as specified by the stockholder or stockholders
granting the proxy. Unless contrary instructions are specified, if the enclosed
proxy card is executed and returned (and not revoked) prior to the Annual
Meeting, the shares of common stock, $.01 par value per share (the "Common
Stock"), of the Company represented thereby will be voted (i) FOR the election
as directors of the nominees listed in this Proxy Statement; (ii) FOR the
amendment to the Company's Stock Option Plan ("the Stock Option Plan") that will
increase the number of shares of Common Stock reserved for grants of options
under the Plan from 3,300,000 to 3,800,000 and (iii) FOR ratification of the
appointment by the Audit Committee of the Board of Directors of Arthur Andersen
LLP to serve as the Company's independent auditor for the Company's fiscal year
ending February 2, 2002 ("fiscal 2002"). The submission of a signed proxy will
not affect a stockholder's right to attend and to vote in person at the Annual
Meeting. A stockholder who executes a proxy may revoke it at any time before it
is voted by filing with the Secretary of the Company either a written revocation
or an executed proxy bearing a later date or by attending and voting in person
at the Annual Meeting.

Only holders of record of Common Stock as of the close of business on
April 17, 2001 (the "Record Date") will be entitled to vote at the Annual
Meeting. As of the close of business on the Record Date, there were 17,179,257
shares of Common Stock (the "Shares") outstanding. Holders of Shares authorized
to vote are entitled to cast one vote per Share on all matters. The holders of a
majority of the Shares entitled to vote must be present or represented by proxy
to constitute a quorum. Shares as to which authority to vote is withheld and
abstentions are counted in determining whether a quorum exists.

Under Delaware law, directors are elected by the affirmative vote, in
person or by proxy, of a plurality of the shares entitled to vote in the
election at a meeting at which a quorum is present. Only

votes actually cast will be counted for the purpose of determining whether a
particular nominee received more votes than the persons, if any, nominated for
the same seat on the Board of Directors.

Approval of the proposals to amend the Company's Stock Option Plan, to
ratify the appointment of Arthur Andersen LLP as the Company's independent
auditor for fiscal 2002 and any other matters that may properly come before the
Annual Meeting, requires the affirmative vote of a majority of the Shares
represented in person or by proxy and entitled to vote on such matter at a
meeting at which a quorum is present. Abstentions will be counted in determining
the minimum number of votes required for approval and will, therefore, have the
effect of votes against such proposal. Broker non-votes, meaning those Shares
held by a broker or nominee as to which such broker or nominee does not have
discretionary voting power, will not be counted as votes for or against approval
of such matters.

With respect to any other matters that may come before the Annual
Meeting, if proxies are executed and returned, such proxies will be voted in a
manner deemed by the proxy representatives named therein to be in the best
interests of the Company and its stockholders.

PROPOSAL I - ELECTION OF DIRECTORS

The Board of Directors of the Company is divided into three classes of
directors serving staggered terms of office. Upon the expiration of the term of
office of a class of directors, the nominee or nominees for that class are
elected for a term of three years to serve until the election and qualification
of their successors. The current term of Mr. Charles C. Anderson, Dr. J. Barry
Mason and Mr. William H. Rogers, Jr. expires upon the election and qualification
of the directors to be elected at this Annual Meeting. The Board of Directors
has nominated Mr. Anderson, Dr. Mason and Mr. Rogers for re-election to the
Board of Directors at the Annual Meeting, to serve until the 2004 annual meeting
of stockholders and until their successors are duly elected and qualified.

All Shares represented by properly executed proxies received in
response to this solicitation will be voted for the election of the directors as
specified therein by the stockholders. Unless otherwise specified in the proxy,
it is the intention of the persons named on the enclosed proxy card to vote FOR
the election of Mr. Charles C. Anderson, Dr. J. Barry Mason and Mr. William H.
Rogers, Jr. to the Board of Directors. Mr. Anderson, Dr. Mason and Mr. Rogers
have each consented to serve as a director of the Company if elected. If at the
time of the Annual Meeting, Mr. Anderson, Dr. Mason or Mr. Rogers is unable or
declines to serve as a director, the discretionary authority provided in the
enclosed proxy card will be exercised to vote for a substitute candidate
designated by the Board of Directors. The Board of Directors has no reason to
believe that Mr. Anderson, Dr. Mason or Mr. Rogers will be unable or will
decline to serve as a director.

Stockholders may withhold their votes from a nominee by so indicating
in the space provided on the enclosed proxy card.

Set forth below is certain information furnished to the Company by Mr.
Charles C. Anderson, Dr. J. Barry Mason and Mr. William H. Rogers, Jr. and by
each of the incumbent directors whose terms will continue following the Annual
Meeting.

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NOMINEES FOR ELECTION - TERM EXPIRING 2004

CHARLES C. ANDERSON
Age: 66

Charles C. Anderson served as the Chairman of the Board of the Company
for more than 28 years. He also served as the Chief Executive Officer of the
Company from 1964 to July 1992. Mr. Anderson is the father of Clyde B. Anderson,
the Company's Chief Executive Officer and Chairman of the Board of Directors,
and Terry C. Anderson, a member of the Company's Board of Directors.

J. BARRY MASON
Age: 60

J. Barry Mason has served as a director of the Company since April
1998. Dr. Mason has held the positions of Dean and Thomas D. Russell Professor
of Business at Culverhouse College of Commerce, The University of Alabama since
1988.

WILLIAM H. ROGERS, JR.
Age: 43

William H. Rogers, Jr. has served as a director of the Company since
November 2000. Mr. Rogers serves as Executive Vice President, Private Client
Services for SunTrust Banks, Incorporated and has held various other positions
with SunTrust since 1980.

THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS
VOTE FOR THE ELECTION AS DIRECTOR OF THE NOMINEES NAMED ABOVE.

INCUMBENT DIRECTOR - TERM EXPIRING 2002

TERRY C. ANDERSON
Age: 43

Terry C. Anderson has served as a director of the Company since April
1998. Mr. Anderson serves as the President and Chief Executive Officer of
American Promotional Events, Inc., an importer and wholesaler of pyrotechnics,
since July 1988. Mr. Anderson is the son of Charles C. Anderson, a member of
Company's Board of Directors, and the brother of Clyde B. Anderson, the
Company's Chief Executive Officer and Chairman of the Company's Board of
Directors.

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INCUMBENT DIRECTORS - TERM EXPIRING 2003

CLYDE B. ANDERSON
Age: 40

Clyde B. Anderson has served as a director of the Company since August
1987. Mr. Anderson has served as the Chairman of the Board of the Company since
January 2000 and the Chief Executive Officer of the Company since July 1992. Mr.
Anderson served as the President of the Company from November 1987 to August
1999. From November 1987 to March 1994, Mr. Anderson also served as the
Company's Chief Operating Officer. Mr. Anderson serves on the Board of Directors
and the Compensation Committee of Hibbett Sporting Goods, Inc., a sporting goods
retailer. Mr. Anderson is the son of Charles C. Anderson and the brother of
Terry C. Anderson, both members of the Company's Board of Directors.

RONALD G. BRUNO
Age: 49

Ronald G. Bruno has served as the President of Bruno Capital Management
Corporation, an investment company, since September 1995 and has served as a
director of the Company since September 1992. Formerly, Mr. Bruno served as the
Chairman and Chief Executive Officer of Bruno's Supermarkets, Inc., a
supermarket retailing chain, for over five years. Mr. Bruno is a director of
Bruno's Supermarkets, Inc., Russell Corporation, a sports apparel manufacturing
company, and Southtrust Bank of Alabama, N.A.

INFORMATION CONCERNING THE BOARD OF DIRECTORS

The Company's Board of Directors held eight meetings during the
Company's fiscal year ended February 3, 2001 ("fiscal 2001"). The Board has an
Executive Committee, an Audit Committee and a Compensation Committee, but does
not have a Nominating Committee. Each director attended all of the meetings of
the Board and the committees of the Board on which he served.

Committees of the Board of Directors. The Executive Committee consists
of Messrs. Charles C. Anderson, Chairman of the Committee, Clyde B. Anderson and
Ronald G. Bruno. The Executive Committee is authorized to exercise all of the
power and authority of the Board of Directors in the management of the business
and affairs of the Company, including, without limitation, the power and
authority to declare a dividend, to authorize the issuance of stock and to adopt
a certificate of ownership and merger pursuant to Section 253 of the Delaware
General Corporation Law. The authority of the Executive Committee does not
extend to certain fundamental corporate transactions. The Executive Committee
does not hold regularly scheduled meetings but meets when necessary. The
Executive Committee did not hold any meetings in fiscal 2001.

The Audit Committee consists of Messrs. J. Barry Mason, Chairman of the
Committee, Ronald G. Bruno and William H. Rogers, Jr. The responsibilities of
the Audit Committee include, in addition to such other duties as the Board may
specify, recommending independent auditors, reviewing with the independent
auditors the scope and results of the audit engagement, monitoring

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the Company's financial policies and control procedures and reviewing and
monitoring the provision of non-audit services by the Company's auditors. The
Audit Committee held two meetings in fiscal 2001.

The Board of Directors has determined that the members of the Audit
Committee are independent directors, as defined by the Audit Committee Charter.
The Audit Committee acts under a written charter first adopted in 1992 and
updated in November 2000. The updated charter is attached as Appendix A to this
Proxy Statement.

Audit Fee Summary. During fiscal 2001 Arthur Andersen LLP billed the
Company $77,000, including out-of-pocket expenses, for professional services
rendered in connection with the audit of the Company's financial statements for
the most recent fiscal year and the reviews of the financial statements included
in each of the Company's Quarterly Reports on Form 10-Q during the fiscal year
ended February 3, 2001.

Financial Information Systems Design and Implementation Fees. Arthur
Andersen LLP did not provide any services related to financial information
systems design and implementation during fiscal 2001.

All Other Fees. Arthur Andersen LLP also billed the Company $23,000,
including out-of-pocket expenses, for other services rendered to the Company for
the fiscal year ended February 3, 2001, primarily related to employee benefit
plan audits.

The Audit Committee has considered whether the provision of non-audit
services by the Company's independent auditor is compatible with maintaining
auditor independence, and believes that the provision of such services is
compatible.

Report of the Audit Committee. The Audit Committee has:

- Reviewed and discussed with management the Company's
audited financial statements for the fiscal year
ended February 3, 2001;

- Discussed with Arthur Andersen LLP, the Company's
independent auditor, the matters required to be
discussed by Statement on Accounting Standards 61,
Communication with Audit Committees, as amended, by
the Auditing Standards Board of the American
Institute of Certified Public Accountants;

- Received and reviewed the written disclosures and the
letter from the independent auditor required by
Independence Standard No. 1, Independence Standards
Board, and discussed with the auditors the auditors'
independence; and

- Based on the review and discussions referred to
above, recommended to the Board of Directors that the
financial statements referred to above be included in
the Company's Annual Report on Form 10-K for the year
ended February 3, 2001 for filing with the Securities
and Exchange Commission.

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By the Audit Committee of the Board of Directors:

J. Barry Mason, Chairman
Ronald G. Bruno
William H. Rogers, Jr.

The Compensation Committee consists of Messrs. Ronald G. Bruno,
Chairman of the Committee, J. Barry Mason and William H. Rogers, Jr. The
responsibilities of the Compensation Committee include, in addition to such
other duties as the Board may specify, establishing salaries, bonuses and other
compensation for the Company's executive officers and administering the
Company's Stock Option Plan, Employee Stock Purchase Plan and Executive
Incentive Plan. The Compensation Committee held three meetings in fiscal 2001.

Compensation of Directors. Directors who are not employees of the
Company ("Non Employee Directors") receive an annual retainer fee of $15,000 and
an attendance fee of $1,000 for each Board and committee meeting attended, as
well as reimbursement of all out-of-pocket expenses incurred in attending all
such meetings. In addition, the Company's non-employee directors are eligible to
receive formula grants of stock options under the Company's Stock Option Plan.

Under the Company's Stock Option Plan, each director who is not an
employee of the Company or its subsidiary shall, on the first day he serves as a
director, be automatically granted options to purchase 10,000 shares of Common
Stock from the Company at the "fair market value" (as defined in the Stock
Option Plan) of such Common Stock on such date. Further, each such director who
is serving as a director on the last business day of each calendar year and who
has served as a director for more than one year shall automatically be granted
options to purchase 6,000 shares of Common Stock from the Company at the fair
market value of the Common Stock on such date. Accordingly, each of Messrs.
Charles C. Anderson, Terry C. Anderson, Ronald G. Bruno and J. Barry Mason
received a grant of options to purchase 6,000 shares of Common Stock at an
exercise price of $1.39 per share on December 29, 2000. William H. Rogers, Jr.,
upon his appointment to the Company's Board of Directors, received a grant of
options to purchase 10,000 shares of Common Stock at an exercise price of $2.39
on November 15, 2000. Prior to January 9, 2001, all options granted to directors
expired on the sixth anniversary of the date of grant. On January 9, 2001, the
Compensation Committee approved an amendment to the Stock Option Plan that
allows all options granted after that date to expire on the tenth anniversary of
the date of the grant. Each of these options granted to directors of the Company
are immediately exercisable and all of the current outstanding options granted
to directors expire on the earlier of the sixth anniversary of the date of grant
or 90 days after such individual ceases to be a director of the Company.

Compliance with Section 16(a) of the Securities Exchange Act of 1934.
Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange Act")
requires the Company's directors, executive officers and persons who own
beneficially more than 10% of the Company's Common Stock to file reports of
ownership and changes in ownership of such stock with the Securities and
Exchange

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Commission (the "SEC") and the Nasdaq Stock Market, Inc. Directors, executive
officers and greater than 10% stockholders are required by SEC regulations to
furnish the Company with copies of all such forms they file. To the Company's
knowledge, based solely on a review of the copies of such reports furnished to
the Company and written representations that no other reports were required, its
directors, executive officers and greater than 10% stockholders complied during
fiscal 2001 with all applicable Section 16(a) filing requirements.

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BENEFICIAL OWNERSHIP OF COMMON STOCK

The following table sets forth information concerning the beneficial
ownership of Common Stock of the Company of (i) those persons known by
management of the Company to own beneficially more than 5% of the Company's
outstanding Common Stock, (ii) the directors of the Company, (iii) the executive
officers named in the Summary Compensation Table included elsewhere herein and
(iv) all current directors and executive officers as a group. Such information
is provided as of April 11, 2001. According to rules adopted by the SEC, a
person is the "beneficial owner" of securities if he or she has or shares the
power to vote them or to direct their investment or has the right to acquire
beneficial ownership of such securities within 60 days through the exercise of
an option, warrant, right of conversion of a security or otherwise. Except as
otherwise noted, the indicated owners have sole voting and investment power with
respect to shares beneficially owned. An asterisk in the percent of class column
indicates beneficial ownership of less than 1% percent of the outstanding Common
Stock.

Amount and Nature of Percent of
Name of Beneficial Owner Beneficial Ownership Class
- ------------------------ -------------------- ----------

Charles C. Anderson 1/ 2,498,873 2/ 14.5%

Joel R. Anderson 1/ 1,782,440 3/ 10.4

Clyde B. Anderson 4/ 1,705,167 5/ 9.9

Dimensional Fund Advisors, Inc. 6/ 1,337,200 7.8

Terry C. Anderson 453,272 7/ 2.6

Sandra B. Cochran 131,927 8/ *

Terrance G. Finley 91,739 9/ *

Ronald G. Bruno 61,000 10/ *

J. Barry Mason 30,000 11/ *

Richard S. Wallington 18,886 12/ *

William H. Rogers, Jr. 10,000 13/ *

All current directors and executive
officers as a group (9 persons) 4,917,864 14/ 29.0%

- ---------------

1/ The business address of Mr. Charles C. Anderson and Mr. Joel R.
Anderson is 202 North Court Street, Florence, Alabama 35630. Mr.
Charles C. Anderson serves on the Company's Board of Directors. His
brother, Mr. Joel R. Anderson, does not serve as an officer or director
of the Company.

2/ Includes 83,000 shares held by a charitable foundation of which Mr.
Charles C. Anderson is the Chairman of the Board of Directors, and
6,000 shares subject to options exercisable on or before June 10, 2001.

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12

3/ Includes 83,000 shares held by a charitable foundation of which Mr.
Joel R. Anderson is the Chairman of the Board of Directors.

4/ Mr. Clyde B. Anderson's business address is 402 Industrial Lane,
Birmingham, Alabama 35211.

5/ Includes 83,000 shares and 50,000 shares held by charitable foundations
of which Mr. Clyde B. Anderson is a member of the Board of Directors
and the Chairman of the Board of Directors, respectively. This number
also includes 148,000 shares subject to options exercisable on or
before June 10, 2001.

6/ Dimensional Fund Advisors, Inc. is an investment advisor to a group of
four investment companies. Its business address is 1299 Ocean Avenue,
11th Floor, Santa Monica, California 90401.

7/ Includes 18,000 shares subject to options exercisable on or before June
10, 2001.

8/ Includes 129,500 shares subject to options exercisable on or before
June 10, 2001.

9/ Includes 88,000 shares subject to options exercisable on or before June
10, 2001.

10/ Includes 24,000 shares subject to options exercisable on or before June
10, 2001.

11/ Includes 28,000 shares subject to options exercisable on or before June
10, 2001.

12/ Includes 14,600 shares subject to options exercisable on or before June
10, 2001.

13/ Represents options exercisable on or before June 10, 2001.

14/ Includes 466,100 shares subject to options exercisable on or before
June 10, 2001.

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EXECUTIVE COMPENSATION

Pursuant to SEC rules for Proxy Statement disclosure of executive
compensation, the Compensation Committee of the Board of Directors of the
Company has prepared the following Report on Executive Compensation. The
Committee intends that this report clearly describe the current executive
compensation program of the Company, including the underlying philosophy of the
program and the specific performance criteria on which executive compensation is
based. This report also discusses in detail the compensation paid to the
Company's Chief Executive Officer, Mr. Clyde B. Anderson, during fiscal 2001.

REPORT ON EXECUTIVE COMPENSATION

The Compensation Committee, which consists of Messrs. Ronald G. Bruno
(who served as Chairman throughout fiscal 2001), J. Barry Mason and William H.
Rogers, Jr., was responsible for establishing salaries, bonuses and other
compensation for the Company's executive officers for fiscal 2001, as well as
for administering the Company's Stock Option Plan, Employee Stock Purchase Plan
and Executive Incentive Plan. Each member of the Compensation Committee is a
non-employee director.

Compensation Policy. The Company's executive compensation policy is
designed to provide levels of compensation that integrate compensation with the
Company's annual and long-term performance goals and reward above-average
corporate performance, thereby allowing the Company to attract and retain
qualified executives. Specifically, the Company's executive compensation policy
is intended to:

- Provide compensation levels that are consistent with the
Company's business plan, financial objectives and operating
performance;

- Reward performance that facilitates the achievement of the
Company's business plan;

- Motivate executives to achieve strategic operating objectives;
and

- Align the interests of executives with those of stockholders
and the long-term interest of the Company by providing
long-term incentive compensation in the form of stock options.

In light of the Company's compensation policy, the components of its
executive compensation program for fiscal 2001 were base salaries, cash bonuses
and stock options.

Base Salary. Each executive officer's base salary (including the Chief
Executive Officer's base salary) is based upon a number of factors, including
the responsibilities borne by the executive officer and his or her length of
service to the Company. Each executive officer's base salary is reviewed
annually and generally adjusted to account for inflation, the Company's
financial performance, any change in the executive officer's responsibilities
and the executive officer's overall performance. Factors considered in
evaluating performance include financial results such as increases in sales, net
income before taxes and earnings per share, as well as non-financial measures
such as

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14

improvements in service and relationships with customers, suppliers and
employees, employee safety and leadership and management development. These
non-financial measures are subjective in nature. No particular weight is given
by the Compensation Committee to any particular factor.

Cash Bonuses. Each executive officer, including the Chief Executive
Officer, is eligible to receive an annual cash bonus of up to 70% of his or her
base salary at the time of the award. Cash bonuses generally are paid pursuant
to a bonus program established at the beginning of a fiscal year in connection
with the preparation of the Company's annual operating budget for such year.
Under this bonus program, an executive officer (including the Chief Executive
Officer) is eligible to receive a bonus upon the Company achieving certain net
income goals and the executive officer accomplishing certain individual
performance goals related to his or her job functions.

Stock Options. In September 1992, the Company adopted a Stock Option
Plan under which executive officers, including the Chief Executive Officer, are
eligible to receive stock options. In general, stock option awards are granted
on an annual basis if warranted by the Company's growth and profitability. The
Compensation Committee evaluates the Company's performance against
pre-determined target levels of sales, net income and earnings per share in
determining whether option grants are warranted and the aggregate amount of such
grants. Under the Stock Option Plan, all stock options granted have had exercise
prices no less than the fair market value (generally, the closing sale price of
a share) of the Company's Common Stock on the date of grant. Prior to January 9,
2001, all options granted to employees become exercisable in equal annual
increments over a five-year period and expired on the sixth anniversary of the
date of grant. On January 9, 2001, the Compensation Committee approved an
amendment to the Stock Option Plan that allows all options granted after that
date to vest in equal annual increments over a three-year period and expire on
the tenth anniversary of the date of the grant. The Compensation Committee
believes that these features serve to align the interests of executives with
those of stockholders and the long-term interests of the Company. Options to
purchase 320,000 shares of Common Stock were granted to a total of four
executive officers in fiscal 2001. The amount of each executive officer's grant
of stock options was based upon an evaluation of such executive officer's
responsibilities and performance, the desirability of long-term service from the
particular executive officer, the aggregate amount of prior stock option awards
to the particular executive officer and the Company's overall financial
performance. While the Compensation Committee has not established a target level
of stock ownership by the Company's executive officers, it does encourage such
ownership and intends to gradually increase the ownership of the Company's
Common Stock by executive officers and other key employees.

Executive Incentive Plan. During fiscal 1995, the Company adopted the
Books-A-Million, Inc. Executive Incentive Plan (the "Incentive Plan"). The
Incentive Plan provides for awards to certain executive officers of cash, shares
of restricted stock or both, based on the achievement of specific
pre-established performance goals during a three consecutive fiscal year
performance period. No awards were made under the Incentive Plan during fiscal
2001.

Compensation of Chief Executive Officer. During fiscal 2001, the
Company's Chief Executive Officer, Mr. Clyde B. Anderson, earned compensation
comprised of each of the base salary and stock option components of the
Company's executive compensation program described above. The Compensation
Committee established his compensation after reviewing the compensation

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packages of other chief executive officers of publicly-traded retailers (as
reported in such companies' proxy statements). The Compensation Committee
considered the size, location, revenues, earnings and capital structure of the
retailers whose chief executive officers' compensation packages were reviewed,
and attempted to provide Mr. Anderson with comparable compensation based upon
the Committee's subjective comparison of the size, location, revenues, earnings
and capital structure of the Company. During fiscal 2001, Mr. Anderson also
received options to purchase 125,000 shares of Common Stock at an exercise price
of $1.69 per share. Mr. Anderson's options have an exercise price equal to the
fair market value (generally, the closing sale price of a share) of the
Company's Common Stock on the date of grant and vest in equal annual increments
over three years, as do the options granted to other executive officers of the
Company.

Limitations on Deductibility of Compensation. Under the 1993 Omnibus
Budget Reconciliation Act, a portion of annual compensation payable after 1993
to any of the Company's five highest paid executive officers would not be
deductible by the Company for federal income tax purposes to the extent such
officer's overall compensation exceeds $1,000,000. Qualifying performance-based
incentive compensation, however, would be both deductible and excluded for
purposes of calculating the $1,000,000 limit. Although the Compensation
Committee does not presently intend to award compensation in excess of the
$1,000,000 limit, it will continue to address this issue when formulating
compensation arrangements for the Company's executive officers.

Mr. Ronald G. Bruno (Chairman)
Dr. J. Barry Mason
Mr. William H. Rogers, Jr.

The Report on Executive Compensation of the Compensation Committee of
the Board of Directors shall not be deemed to be incorporated by reference as a
result of any general incorporation by reference of this Proxy Statement or any
part hereof in the Company's Annual Report to Stockholders or its Annual Report
on Form 10-K.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

Interlocks. As indicated above, the Compensation Committee of the Board
of Directors consists of Messrs. Ronald G. Bruno, J. Barry Mason and William H.
Rogers, Jr.. During fiscal 2001, Charles C. Anderson, Clyde B. Anderson and
Terry C. Anderson served as executive officers or directors of a total of nine
companies owned or controlled by the Anderson family (the "Other Companies"),
with which there is an "interlock" relationship, as defined by the SEC, arising
from the concurrent participation of (i) Charles C. Anderson and Clyde B.
Anderson, both as executive officers of the Company and as members of the boards
of directors (and/or the compensation committees) of certain of the Other
Companies and (ii) Charles C. Anderson and Terry C. Anderson, both as executive
officers of certain of the Other Companies and as members of the Board of
Directors of the Company.

Certain Transactions. During fiscal 2001, the Company entered into
certain transactions in the ordinary course of business with certain entities
affiliated with Messrs. Charles C. Anderson, Terry C. Anderson and Clyde B.
Anderson. The Board of Directors of the Company believes that all

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such transactions were on terms no less favorable to the Company than terms
available from unrelated parties for comparable transactions. Significant
activities with these entities are discussed in the following paragraphs.

The Company and American Wholesale Book Company ("American Wholesale")
purchase certain of their collectibles and books from Treat Entertainment, Inc.
("Treat"), which is wholly-owned by members of the Anderson family. During
fiscal 2001, such purchases from Treat totaled $3,176,664. The Company and
American Wholesale also purchase certain of their paperback books, newspapers
and a substantial portion of their magazines and music from Anderson News
Corporation ("Anderson News"), virtually all of the outstanding stock of which
is owned by members of the Anderson family. During fiscal 2001, purchases of
these items from Anderson News totaled $30,951,594. During fiscal 2001, the
Company and American Wholesale sold books to Treat and Anderson News in the
amounts of $366,125 and $3,574,067, respectively. The Company and American
Wholesale utilize logistics services from a transportation company, which is
majority-owned by members of the Anderson family. During fiscal 2001, such
services provided by the transportation company totaled $250,070.

The Company leases its principal executive offices from a trust, which
was established for the benefit of the grandchildren of Mr. Charles C. Anderson.
The lease extends to January 31, 2006. During fiscal 2001, the Company paid rent
of $119,294 to the trust under this lease. Anderson & Anderson LLC ("A&A"),
which is wholly owned by members of the Anderson family, also leases three
buildings to the Company. During fiscal 2001, the Company paid A&A a total of
$538,955 in connection with such leases.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

See "Compensation Committee Interlocks and Insider Participation -
Certain Transactions" above for a description of certain transactions and
relationships between the Company (or American Wholesale) and other entities
affiliated with certain of its executive officers.

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EXECUTIVE OFFICER COMPENSATION

This section of the Proxy Statement discloses the compensation awarded,
paid to or earned by, the Company's Chief Executive Officer and its three most
highly compensated officers other than the Chief Executive Officer during fiscal
2001. Such executive officers are hereinafter referred to as the Company's
"Named Executive Officers."

TABLE I - SUMMARY COMPENSATION TABLE

The following table presents the total compensation of the Company's
Named Executive Officers during each of the fiscal years set forth below.

TABLE I - SUMMARY COMPENSATION TABLE

Annual Compensation Long-Term Compensation
------------------------------ ---------------------------
Fiscal Salary Bonus Number of Securities All Other
Name Year $ $ 1/ Underlying Options(#) 1/ 2/ Compensation($)
---- ------ ------ ------ --------------------------- ---------------

Clyde B. Anderson 2001 400,000 65,000 125,000 71,088 3/
Chairman and Chief Executive Officer 2000 336,000 262,500 75,000 20,257 4/
1999 310,000 0 55,000 1,447,855 5/

Sandra B. Cochran 2001 300,000 37,500 90,000 6,000 3/
President and Secretary 2000 217,000 237,500 160,000 9,633 4/
1999 193,000 87,250 45,000 914,695 5/

Terrance G. Finley 2001 225,000 135,000 75,000 5,820 3/
President, American Internet Services 2000 173,000 100,000 70,000 5,489 4/
1999 147,000 45,500 35,000 584,457 5/

Richard S. Wallington 2001 140,000 12,500 30,000 3,076 3/
Chief Financial Officer 2000 114,000 45,000 20,000 20,809 4/
1999 102,000 25,000 7,000 83,328 5/

1/ In fiscal 1995, the Company's Board of Directors adopted the
Books-A-Million, Inc. Executive Incentive Plan and authorized Sandra B.
Cochran and Terrance G. Finley to participate in such plan. However,
because no awards were made under the Executive Incentive Plan during
fiscal 2001, no amounts are included in the table with respect to such
plan.

2/ All of the options granted to the Company's Named Executive Officers
prior to January 9, 2001 become exercisable in equal increments over
five years and expire six years from the date of the grant (or earlier
if the optionee dies or ceases to be employed full-time by the
Company). Options granted after January 9, 2001 become exercisable in
equal increments on the first, second and third anniversaries of the
date of grant and expire ten years from the date of grant (or earlier
if the optionee dies or ceases to be employed full-time by the
Company).

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3/ For fiscal 2001, the amounts shown include (i) matching contributions
by the Company to the Company's 401(k) savings plan ("Matching
Contributions") of $5,100 on behalf of each of Clyde B. Anderson,
Sandra B. Cochran and Terrance G. Finley and $2,800 on behalf of
Richard S. Wallington and (ii) life insurance premiums of $540 on
behalf of each of Clyde B. Anderson and Sandra B. Cochran, and $720 and
$276 on behalf of Terrance G. Finley and Richard S. Wallington,
respectively.

4/ For fiscal 2000, the amounts shown include (i) matching contributions
by the Company to the Company's 401(k) savings plan ("Matching
Contributions") of $4,800 on behalf of each of Clyde B. Anderson and
Sandra B. Cochran, $4,435 on behalf of Terrance G. Finley and $2,255 on
behalf of Richard S. Wallington, (ii) life insurance premiums of
$1,080, $834, $676 and $355 paid by the Company on behalf of Clyde B.
Anderson, Sandra B. Cochran, Terrance G. Finley and Richard S.
Wallington, respectively and (iii) gain on stock options exercised of
$18,199 for Richard S. Wallington.

5/ For fiscal 1999, the amounts shown include (i) matching contributions
by the Company to the Company's 401(k) savings plan ("Matching
Contributions") of $4,800 on behalf of each of Clyde B. Anderson and
Sandra B. Cochran, $4,435 on behalf of Terrance G. Finley and $2,248 on
behalf of Richard S. Wallington, (ii) life insurance premiums of $890,
$645, $503 and $159 paid by the Company on behalf of Clyde B. Anderson,
Sandra B. Cochran, Terrance G. Finley and Richard S. Wallington,
respectively and (iii) gain on stock options exercised of $1,442,165,
$909,250, $579,519 and $80,921 for Clyde B. Anderson, Sandra B.
Cochran, Terrance G. Finley and Richard S. Wallington, respectively.

STOCK OPTION INFORMATION

The Company maintains the Books-A-Million, Inc. Stock Option Plan. A
total of 3,300,000 shares of Common Stock are authorized to be made available
for issuance under the Plan. Options granted under the Plan are either incentive
stock options or nonqualified options. The Plan contains certain limitations
with respect to incentive stock options that are intended to satisfy applicable
Internal Revenue Code requirements. Under the Plan, the Company is authorized to
issue options to certain officers, employees, consultants and directors of the
Company and its subsidiaries. Of the 3,300,000 shares of Common Stock reserved
for issuance under the Plan, as of April 11, 2001, 514,380 shares were available
for issuance upon the exercise of outstanding options granted under the Plan.

The Company also maintains separate stock option plans for four of its
subsidiaries: American Internet Services, Inc., Booksamillion.com, Inc.,
NetCentral, Inc. and FaithPoint, Inc. A total of 10,000 shares of Common Stock
are authorized to be made available for issuance under each of the subsidiary
plans. Options granted under each subsidiary plan are either incentive stock
options or nonqualified options. Each subsidiary plan contains certain
limitations with respect to incentive stock options that are intended to satisfy
applicable Internal Revenue Code requirements. Under each subsidiary plan, the
Company is authorized to issue options to certain officers, employees,
consultants and directors of the Company and its subsidiaries. Of the 10,000
shares of Common Stock reserved for issuance under each subsidiary plan, as of
April 11, 2001, all of the shares were available for issuance.

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19

TABLE II - OPTION GRANTS IN FISCAL 2001

This table presents information regarding options granted to the
Company's Named Executive Officers during fiscal 2001 to purchase shares of the
Company's Common Stock. The Company has no outstanding stock appreciation rights
("SARs") and granted no SARs during fiscal 2001. In accordance with SEC rules,
the table shows the hypothetical "gains" or "option spreads" that would exist
for the respective options based on assumed rates of annual compound stock price
appreciation of 5% and 10% from the date the options were granted over the full
option term.

TABLE II - OPTION GRANTS IN FISCAL 2001

Individual Grants Realizable Value
------------------------------------------------------------ At Assumed Annual
Number of Rates of Stock Price
Securities Percent of Appreciation for
Underlying Total Options Exercise Option Term
Options Granted to Price Expiration ----------------------
Name Granted 1/ Employees Per Share Date 5% 10%
- ---- ----------- ------------- -------------- ---------- -------- --------

Clyde B. Anderson 125,000 15.2% $1.69 1/10/11 $132,854 $336,678
Sandra B. Cochran 90,000 11.0% $1.69 1/10/11 $95,655 $242,408
Terrance G. Finley 75,000 9.1% $1.69 1/10/11 $79,712 $202,007
Richard S. Wallington 30,000 3.7% $1.69 1/10/11 $31,885 $80,803

1/ All of the options granted to the Company's Named Executive Officers
become exercisable in equal increments on the first, second and third
anniversaries of the date of grant and expire ten years from the date
of grant or earlier if the optionee dies or ceases to be employed
full-time by the Company.

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TABLE III - OPTION EXERCISES IN FISCAL 2001 AND FISCAL 2001 YEAR-END OPTION
VALUES

None of the Company's Named Executive Officers exercised any options
during fiscal 2001. The following table shows the number of shares of Common
Stock subject to exercisable and unexercisable stock options held by each of the
Named Executive Officers as of February 3, 2001. The table also reflects the
values of such options based on the positive spread between the exercise price
of such options and $2.13, which was the closing sale price of a share of Common
Stock reported in the Nasdaq National Market February 2, 2001 (the last trading
day prior to the end of the Company's fiscal year).

TABLE III - FISCAL 2001 YEAR-END OPTION VALUES

Number of Shares Subject to Value of Unexercised
Unexercised Options at In-the-Money Options
February 3, 2001 at February 3, 2001
Name Exercisable/Unexercisable Exercisable/Unexercisable
- ---- --------------------------- -------------------------

Clyde B. Anderson 148,000/263,000 $0/$54,375
Sandra B. Cochran 129,500/279,000 $0/$39,150
Terrance G. Finley 88,000/178,000 $0/$32,625
Richard S. Wallington 14,600/54,000 $0/$13,050

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PERFORMANCE GRAPH

The following indexed line graph indicates the Company's total return
to stockholders from February 2, 1996 to February 2, 2001, the last trading day
prior to the Company's 2001 fiscal year end, as compared to the total return for
the Nasdaq Composite Index and the Nasdaq Retail Trade Stock Index for the same
period.

[GRAPH]

FEB. 2, 1996 JAN. 31, 1997 JAN. 30, 1998 JAN. 29, 1999 JAN. 28, 2000 FEB. 2, 2001
------------ ------------- ------------- ------------- ------------- ------------

Books-A-Million, Inc. $100 $ 65 $ 65 $123 $ 85 $ 24
NASDAQ Composite Index $100 $130 $152 $240 $370 $252
NASDAQ Retail Trade Stocks $100 $123 $143 $175 $140 $108

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PROPOSAL 2 - AMENDMENT TO THE COMPANY'S STOCK OPTION PLAN

The purpose of the Stock Option Plan is to promote the interests of the
Company and its stockholders by providing additional incentives to employees and
non-employee directors to increase the value of the Company's stock and to
provide employees and non-employee directors with a stake in the future of the
Company that corresponds to the stake of each of the Company's stockholders. The
Board of Directors feels that the Stock Option Plan has proved to be of
substantial value in stimulating the efforts of employees and non-employee
directors by increasing their ownership stake in the Company.

In light of the Company's continued growth, the number of shares
remaining for issuance under the Stock Option Plan is insufficient to provide
adequately for the continued participation of employees and non-employee
directors in the Stock Option Plan in future years. The Stock Option Plan
currently provides for options to purchase up to 3,300,000 shares of Common
Stock to be granted to full-time employees, including executive officers, and to
non-employee directors of the Company. As of April 11, 2001, options to purchase
2,785,620 shares (net of forfeitures) had been granted under the Stock Option
Plan, leaving only 514,380 shares available for future grants. For this reason,
the Board of Directors has adopted an amendment to the Stock Option Plan to
increase the number of shares available for issuance under the Stock Option Plan
by an additional 500,000 shares of Common Stock.

THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS
VOTE IN FAVOR OF THE AMENDMENT TO THE COMPANY'S STOCK
OPTION PLAN.

PROPOSAL 3 - RATIFICATION OF INDEPENDENT PUBLIC AUDITOR

The Audit Committee of the Company's Board of Directors has appointed
Arthur Andersen LLP to serve as the Company's independent auditor for its
current fiscal year (fiscal 2002). A representative of this firm is expected to
attend the Annual Meeting to respond to questions from stockholders and to make
a statement if he or she so desires.

The Board of Directors believes it is in the Company's interest for the
stockholders to have a role in ratifying the Audit Committee's selection of
independent auditor. If the stockholders were to vote against ratification of
Arthur Andersen LLP as the Company's independent auditor, the Audit Committee
may select another independent auditing firm.

THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS
VOTE IN FAVOR OF THE RATIFICATION OF ARTHUR ANDERSEN LLP
AS THE COMPANY'S INDEPENDENT PUBLIC AUDITOR

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OTHER MATTERS

The Board of Directors knows of no other matters to be brought before
the Annual Meeting. However, if any other matters are properly brought before
the Annual Meeting, the persons appointed in the accompanying proxy intend to
vote the Shares represented thereby in accordance with their best judgment.

SOLICITATION OF PROXIES

The cost of the solicitation of proxies on behalf of the Company will
be borne by the Company. In addition, directors, officers and other employees of
the Company may, without additional compensation except reimbursement for actual
expenses, solicit proxies by mail, in person or by telecommunication. The
Company will reimburse brokers, fiduciaries, custodians and other nominees for
out-of-pocket expenses incurred in sending the Company's proxy materials to, and
obtaining instructions relating to such materials from, beneficial owners.

STOCKHOLDER PROPOSALS FOR 2002 ANNUAL MEETING

Any proposal that a stockholder may desire to have included in the
Company's proxy material for presentation at the 2002 annual meeting must be
received by the Company at its executive offices at 402 Industrial Lane,
Birmingham, Alabama 35211, Attention: Mr. Clyde B. Anderson, on or prior to
December 28, 2001. Any such proposal received after March 15, 2002 will be
considered untimely for purposes of the 2002 annual meeting, and proxies
delivered for the 2002 annual meeting will confer discretionary authority to
vote on any such matters.

ANNUAL REPORT

The Company's Annual Report to Stockholders for fiscal 2001 (which is
not part of the Company's proxy soliciting material) is being mailed to the
Company's stockholders with this proxy statement.

May 1, 2001
Birmingham, Alabama

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APPENDIX A

AUDIT COMMITTEE CHARTER

PURPOSE

The Audit Committee is a committee of the Board of Directors. It's primary
function is to assist the board in fulfilling its oversight responsibilities by
reviewing the financial information which will be provided to the shareholders
and others, the systems of internal controls which Management and the Board of
Directors have established, and the audit process. In doing so, it is the
responsibility of the Audit Committee to provide an open avenue of communication
between the Board of Directors, Management, internal audit and the independent
accountants.

ORGANIZATION

- - The Audit Committee shall be appointed annually by the Board of
Directors.
- - The Audit Committee shall consist of at least two members and shall on
and after June 1, 2001, consist of not less than three members.
- - A minimum of two members of the Audit Committee must be independent.
The third member may be non-independent. The independence of a director
is defined by the requirements of the NASDAQ Stock Market, Inc. If a
non-independent member exists, the appropriate disclosures must be made
in the annual proxy statement.
- - At least one member of the Committee shall have a background in
financial reporting, accounting or auditing (however, the lack of any
such member shall not invalidate or otherwise affect the actions taken
by the Committee).
- - The Board shall appoint one of the members of the Audit Committee as
Chairperson. It is the responsibility of the Chairperson to schedule
all meetings of the Committee and to provide the Committee with the
written agenda.

In meeting its responsibilities, the Committee shall:

GENERAL

- Have the power to conduct or authorize investigations into any
matters within the Committee's scope of responsibilities. The
Committee shall have unrestricted access to members of
Management and relevant information. The Committee may retain
independent counsel, accountants or others to assist it in the
conduct of any investigation.
- Meet two times per year or more frequently as circumstances
require.

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25

- Report Committee actions to the Board of Directors with
recommendations, as the Committee may deem appropriate.
- Review annually and update the Committee's formal charter as
well as file the charter with the annual proxy statement as
required.
- Meet at least annually with the independent accountants,
internal audit and Management in separate sessions to discuss
any matters that the Committee believes should be discussed
privately with the Audit Committee.
- Provide for inclusion in the Company's proxy statement or
other SEC filings of any report from the Audit Committee
required by applicable laws and regulations and stating among
other things whether the Audit Committee has:
- Reviewed and discussed the audited financial statements with
management.
- Discussed with the independent auditors the matters required
to be discussed by SAS 61.

- Received disclosures from the auditors regarding the
auditor's independence as required by Independence
Standards Board Standard No. 1 and discussed with the
auditors their independence.
- Recommend to the Board of Directors that the audited
financial statements be included in the Company's
Annual Report on Form 10-K.

INTERNAL CONTROLS AND RISK ASSESSMENT

- - Review and evaluate the effectiveness of the Company's process for
assessing significant risks or exposures and the steps Management has
taken to monitor and control such risks to the Company.
- - Consider and review with Management, internal audit and the independent
accountants:
- The effectiveness of or weaknesses in the Company's internal
controls.
- Any related significant findings and recommendations of the
independent accountants and the internal auditors together
with Management's responses including the timetable for
implementation of recommendations to correct weaknesses in the
internal controls.
- - Receive periodic information from the independent accountant regarding
the independence of the independent accountants, discuss such
information with the independent accountant, and, if so determined by
the Audit Committee, recommend that the Board take appropriate actions
to satisfy itself of the independent accountant's independence.
- - Instruct the independent accountants to communicate directly to the
Audit Committee any serious difficulties or disputes with Management.
The independent accountant is ultimately responsible to the Board of
Directors and Audit Committee of the Company.

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26

INTERNAL AUDIT FUNCTION

- - Evaluate the internal audit process for establishing the annual
internal audit plan and the focus on risk.
- - Evaluate the audit scope and role of internal audit.
- - Consider and review with Management:

- Significant findings and Management's response
including the timetable for implementation to correct
weaknesses.

- Any difficulties encountered in the course of their
audit such as restrictions on the scope of their work or
access to information.

- Any changes required in the planned scope of their
audit plan.

- The internal audit budget.

FINANCIAL REPORTING

- - Advise management based upon its review and discussion whether anything
has come to the Audit Committee's attention that causes it to believe
that the audited financial statements included in the Company's Form
10-K contain an untrue statement of material fact or omit to state a
necessary material fact.
- - Review with Management and the independent accountants at the
completion of the annual examination:
- The Company's annual financial statements and related
footnotes.
- The independent accountant's audit of the financial
statements and their report.
- Any significant changes required in the independent
accountant's audit plan.
- Any difficulties or disputes with Management
encountered during the audit.
- The quality of the Company's accounting principles.
- Other matters related to conduct, which should be
communicated to the Committee under generally
accepted auditing standards.

EXTERNAL AUDITOR

- - Recommend to the Board of Directors the independent accountants to be
nominated, approve compensation of the independent accountants and
review and approve the discharge of the independent accountants.
- - Review the scope and approach of the annual audit with the independent
accountants.
- - Assess the external auditor's process for identifying and responding to
key audit and internal control risks.

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COMPLIANCE WITH CODES OF ETHICAL CONDUCT

- - Review and monitor, as appropriate with the independent accountants the
administration of and compliance with, the Company's code of conduct
and the Foreign Corrupt Practices Act.

While the Audit Committee has the responsibilities and the powers set forth in
this Charter, it is not the duty of the Audit Committee to plan or conduct
audits or to determine that the Company's financial statements are complete and
accurate and are in accordance with generally accepted accounting principles.
This is the responsibility of management and the independent accountants. Nor is
it the duty of the Audit Committee to conduct investigations, to resolve
disagreements, if any, between management and the independent accountants or to
assume compliance with laws and regulations and the Company's code of conduct.

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THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS OF
BOOKS-A-MILLION, INC.

The undersigned stockholder(s) of Books-A-Million, Inc., a Delaware
corporation (the "Company"), hereby acknowledge(s) receipt of the Notice of
Annual Meeting of Stockholders and Proxy Statement, each dated May 1, 2001, and
hereby appoints Clyde B. Anderson and Sandra B. Cochran, or either of them,
proxies and attorneys-in-fact, with full power of substitution, on behalf and in
the name of the undersigned to represent the undersigned at the 2001 Annual
Meeting of Stockholders of the Company to be held at 10:00 a.m. on Thursday,
June 7, 2001 at The Harbert Center, 2019 Fourth Avenue North, Birmingham,
Alabama, 35203 and at any adjournment(s) thereof, and to vote all shares of
Common Stock which the undersigned would be entitled to vote if then and there
personally present, on the matters set forth below.

This Proxy, when properly executed, will be voted in accordance with
the directions given by the undersigned stockholder (s). If no direction is
made, it will be voted FOR Proposals 1, 2 and 3 on the reverse side and as the
proxies deem advisable on such other matters which may properly come before the
meeting (Proposal 4).

(1) To elect the nominees listed below to serve as a director of the Company for
a three-year term expiring in 2004:

Charles C. Anderson J. Barry Mason William H. Rogers, Jr.

[ ] FOR the nominees listed above, [ ] WITHHOLD authority to vote
except as indicated below. for all of the nominees listed above.

* To withhold authority for any individual nominee, mark "FOR"
above and write the name of the nominee as to whom you wish
to withhold authority in the space below:

(2) To approve an amendment to the Company's Stock Option Plan that will
increase the number of shares of Common Stock reserved for grants of options
under the Plan from 3,300,000 to 3,800,000.

[ ] FOR [ ] AGAINST [ ] ABSTAIN

(3) To ratify the appointment by the Audit Committee of the Board of Directors
of Arthur Andersen LLP to serve as the Company's independent auditor for the
fiscal year 2002.

[ ] FOR [ ] AGAINST [ ] ABSTAIN

(4) In their discretion, upon such other matter or matters which may properly
come before the meeting or any adjournment(s) thereof.

PLEASE COMPLETE, DATE, SIGN AND RETURN THIS PROXY PROMPTLY.

Dated , 2001
------------------

-----------------------------------
Signature

-----------------------------------
Signature (if held jointly)
Title or authority (if
applicable)

NOTE: Please sign exactly as
name appears hereon. If
shares are registered in more
than one name, the signature
of all such persons are
required. A corporation
should sign in its full
corporate name by a duly
authorized officer, stating
his or her title. Trustees,
guardians, executors and
administrators should sign in
their official capacity,
giving their full title as
each. If a partnership,
please sign in the
partnership name by an
authorized person.