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FORM 10-Q

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

(Mark One)

X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the quarterly period ended October 25, 2003 Commission file number 1-4947

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the transitional period from ______________ to ________________
Commission File No. ______________

J. C. PENNEY FUNDING CORPORATION
(Exact name of registrant as specified in its charter)

Delaware 51-0101524
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

6501 Legacy Drive, Plano, Texas 75024 - 3698
(Address of principal executive offices)
(Zip Code)

(972) 431-1000
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year,
if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

Yes X No

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).

Yes No X

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

500,000 shares of Common Stock of $100 par value, as of December 3, 2003.

THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H (1) (a)
AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED
DISCLOSURE FORMAT.
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PART I - FINANCIAL INFORMATION

Item 1 - Unaudited Financial Statements

The following interim financial information of J. C. Penney Funding Corporation
("Funding"), a wholly owned subsidiary of J. C. Penney Corporation, Inc.
("JCPenney"), is unaudited; however, in the opinion of Funding, it includes all
adjustments, consisting only of normal recurring accruals, necessary for a fair
presentation. The financial information should be read in conjunction with the
audited financial statements included in Funding's Annual Report on Form 10-K
for the 52 weeks ended January 25, 2003.


Statements of Income and Reinvested Earnings
(Dollars in millions) (Unaudited)




13 weeks ended 39 weeks ended
Oct. 25, Oct. 26, Oct. 25, Oct. 26,
2003 2002 2003 2002
Interest earned from
JCPenney and affiliates $ - $ - $ - $ -

Interest expense - - - -
___ ___ ___ ___
Income before income taxes - - - -

Income taxes - - - -
___ ___ ___ ___
Net income - - - -

Reinvested earnings at 1,093 1,093 1,093 1,093
beginning of period _____ _____ _____ _____
Reinvested earnings at
end of period $1,093 $1,093 $1,093 $1,093
====== ====== ====== ======

The accompanying notes are an integral part of these unaudited Interim Financial
Statements.

2


Balance Sheets
(Dollars in millions) (Unaudited)



Oct. 25, Oct. 26, Jan.25,
2003 2002 2003
ASSETS

Loans to JCPenney and affiliates $1,238 $1,238 $1,238

LIABILITIES AND EQUITY HELD BY JCPENNEY

Liabilities - - -

Equity held by JCPenney:
Common stock (including contributed
capital), par value $100 per share:
Authorized, 750,000 shares
Issued and outstanding, 500,000 shares
145 145 145

Reinvested earnings 1,093 1,093 1,093
_____ _____ _____
Total equity held by JCPenney 1,238 1,238 1,238
_____ _____ _____
Total liabilities and equity held by JCPenney $1,238 $1,238 $1,238
====== ====== ======


The accompanying notes are an integral part of these unaudited Interim Financial
Statements.


3


Consolidated Statements of Cash Flows
(Dollars in millions) (Unaudited)




39 weeks ended
Oct. 25, Oct. 26,
2003 2002
Operating Activities $ - $ -

Financing Activities - -
___ ___

Increase in cash - -

Cash at beginning of year - -
___ ___
Cash at end of third quarter $ - $ -
===== =====

The accompanying notes are an integral part of these unaudited Interim Financial
Statements.

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Notes to the Unaudited Interim Financial Statements

1) Background

Historically, Funding has provided short-term financing for JCPenney.
Principally, Funding issued commercial paper to finance JCPenney's working
capital needs. In 2001, JCPenney sold the assets of J. C. Penney Direct
Marketing Services, Inc. to an unrelated third party. The result of this
transaction coupled with JCPenney's other sources of liquidity eliminated the
need for Funding to issue commercial paper for short-term borrowing
requirements. Therefore, Funding has not produced any revenue or income. In
addition, with Funding's current credit ratings, it is assumed that Funding
would have little or no current access to commercial paper borrowing.



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ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.

Funding derives earnings on loans to JCPenney under the terms of the Loan
Agreement, which provides for unsecured loans to be made by Funding to JCPenney.
Additionally, in order to maintain Funding's income at defined coverage ratios,
Funding's income is supplemented by charges to JCPenney. The income of Funding
is designed to cover Funding's fixed charges (interest expense) at a coverage
ratio mutually agreed upon by Funding and JCPenney. The earnings to fixed
charges coverage ratio has historically been at least one and one-half times.

When applicable, Funding from time to time issues commercial paper through
Credit Suisse First Boston Corporation, J.P. Morgan Securities Inc., Merrill
Lynch Money Markets Inc., and Morgan Stanley Dean Witter to corporate and
institutional investors in the domestic market. The commercial paper is
guaranteed by JCPenney on a subordinated basis. No commercial paper has been
issued or outstanding during 2003 or 2002. The commercial paper program is rated
"Not Prime" by Moody's Investors Service, Inc. and "B" by Fitch Ratings.
Standard & Poor's Rating Services does not rate the program.

Funding had no short-term debt outstanding as of October 25, 2003, nor as of
October 26, 2002.



ITEM 4. Controls and Procedures

Based on their evaluation of Funding's disclosure controls and procedures (as
defined in Rules 13a-14(c) and 15d-14(c) under the Securities Exchange Act of
1934) as of the end of the period covered by this Quarterly Report on Form 10-Q,
Funding's principal executive officer and principal financial officer have
concluded that the design and operation of Funding's disclosure controls and
procedures are effective for the purpose of ensuring that material information
required to be in this Quarterly Report is made known to them by others on a
timely basis. There have not been any changes in Funding's internal control over
financial reporting that occurred during Funding's last fiscal quarter that have
materially affected, or are reasonably likely to materially affect, Funding's
internal control over financial reporting.



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PART II - OTHER INFORMATION


Item 6. Exhibits and Reports on Form 8-K.

(a) Exhibits

31.1 Certification of Michael P. Dastugue Pursuant to ss.302 of
the Sarbanes-Oxley Act of 2002

31.2 Certification of William J. Alcorn Pursuant to ss.302 of the
Sarbanes-Oxley Act of 2002

32.1 Certification of Michael P. Dastugue Pursuant to ss.906 of
the Sarbanes-Oxley Act of 2002

32.2 Certification of William J. Alcorn Pursuant to ss.906 of the
Sarbanes-Oxley Act of 2002

(b) Reports on Form 8-K

None.


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SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.





J. C. PENNEY FUNDING CORPORATION


By: /s/ W. J. Alcorn
-------------------------------
W. J. Alcorn
Vice President and Controller
(Principal Accounting Officer)



Date: December 8, 2003



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Exhibit 31.1

CERTIFICATION
-------------

I, Michael P. Dastugue, Chairman, certify that:

1. I have reviewed this quarterly report on Form 10-Q of J. C. Penney
Funding Corporation;

2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this
report;

4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
registrant and have:

a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made
known to us by others within those entities, particularly during
the period in which this report is being prepared;

b) [Intentionally omitted]

c) Evaluated the effectiveness of the registrant's disclosure
controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure controls
and procedures, as of the end of the period covered by this
report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the
registrant's most recent fiscal quarter (the registrant's fourth
fiscal quarter in the case of an annual report) that has
materially affected, or is reasonably likely to materially
affect, the registrant's internal control over financial
reporting; and

5. The registrant's other certifying officer(s) and I have disclosed,
based on our most recent evaluation of internal control over financial
reporting, to the registrant's auditors and the audit committee of the
registrant's board of directors (or persons performing the equivalent
functions):

a) All significant deficiencies and material weaknesses in the
design or operation of internal control over financial reporting
which are reasonably likely to adversely affect the registrant's
ability to record, process, summarize and report financial
information; and

b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal control over financial reporting.


Date: December 8, 2003. /s/ Michael P. Dastugue
___________________________
Michael P. Dastugue
Chairman of the Board
J. C. Penney Funding Corporation


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Exhibit 31.2

CERTIFICATION
-------------

I, William J. Alcorn, Vice President and Controller, certify that:

1. I have reviewed this quarterly report on Form 10-Q of J. C. Penney
Funding Corporation;

2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this
report;

4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
registrant and have:

a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made
known to us by others within those entities, particularly during
the period in which this report is being prepared;

b) [Intentionally omitted]

c) Evaluated the effectiveness of the registrant's disclosure
controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure controls
and procedures, as of the end of the period covered by this
report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the
registrant's most recent fiscal quarter (the registrant's fourth
fiscal quarter in the case of an annual report) that has
materially affected, or is reasonably likely to materially
affect, the registrant's internal control over financial
reporting; and

5. The registrant's other certifying officer(s) and I have disclosed,
based on our most recent evaluation of internal control over financial
reporting, to the registrant's auditors and the audit committee of the
registrant's board of directors (or persons performing the equivalent
functions):

a) All significant deficiencies and material weaknesses in the
design or operation of internal control over financial reporting
which are reasonably likely to adversely affect the registrant's
ability to record, process, summarize and report financial
information; and

b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal control over financial reporting.


Date: December 8, 2003. /s/ William J. Alcorn
___________________________
William J. Alcorn
Vice President and Controller
J. C. Penney Funding Corporation


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Exhibit 32.1

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


In connection with the Quarterly Report of J. C. Penney Funding Corporation (the
"Company") on Form 10-Q for the period ending October 25, 2003 (the "Report"),
I, Michael P. Dastugue, Chairman of the Board of the Company, certify, pursuant
to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:

(1) the Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations
of the Company.

DATED this 8th day of December 2003.

/s/ Michael P. Dastugue
_________________________
Michael P. Dastugue
Chairman of the Board
J. C. Penney Funding Corporation


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Exhibit 32.2

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


In connection with the Quarterly Report of J. C. Penney Funding Corporation (the
"Company") on Form 10-Q for the period ending October 25, 2003 (the "Report"),
I, William J. Alcorn, Vice President and Controller of the Company, certify,
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:

(1) the Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations
of the Company.

DATED this 8th day of December 2003.

/s/ William J. Alcorn
_________________________
William J. Alcorn
Vice President and Controller
J. C. Penney Funding Corporation



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