SECURITIES AND EXCHANGE COMMISSION
                          WASHINGTON, D.C.  20549
                    __________________________________

                                FORM 10-Q

(Mark One)

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

For the quarterly period ended June 30, 2004

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

For the transition period from _________ to _________.

                        Commission file number 1-8729


                             UNISYS CORPORATION
            (Exact name of registrant as specified in its charter)

               Delaware                            38-0387840
       (State or other jurisdiction             (I.R.S. Employer
       of incorporation or organization)        Identification No.)

               Unisys Way
        Blue Bell, Pennsylvania                          19424
       (Address of principal executive offices)        (Zip Code)

Registrant's telephone number, including area code:  (215) 986-4011


     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 [X]    NO [ ]

     Number of shares of Common Stock outstanding as of June 30, 2004:
334,846,823.






<PAGE> 2

Part I - FINANCIAL INFORMATION

Item 1.  Financial Statements.

                             UNISYS CORPORATION
                         CONSOLIDATED BALANCE SHEETS
                                 (Millions)
   
                                          
                                           June 30,    
                                            2004       December 31,
                                         (Unaudited)       2003
                                         -----------   ------------
Assets
------
Current assets
Cash and cash equivalents                 $  643.4       $  635.9
Accounts and notes receivable, net           885.2        1,027.8
Inventories
   Parts and finished equipment              112.7          121.7
   Work in process and materials             120.0          116.9
Deferred income taxes                        272.4          270.0
Other current assets                         106.4           85.7
                                          --------       --------
Total                                      2,140.1        2,258.0
                                          --------       --------

Properties                                 1,347.4        1,352.7
Less-Accumulated depreciation
  and amortization                           924.8          928.5
                                          --------       --------
Properties, net                              422.6          424.2
                                          --------       --------
Outsourcing assets, net                      529.9          477.5
Marketable software, net                     329.8          332.2
Investments at equity                        183.3          153.3
Prepaid pension cost                          49.6           55.5
Deferred income taxes                      1,385.7        1,384.6
Goodwill                                     186.6          177.5
Other long-term assets                       189.3          211.8
                                          --------       --------
Total                                     $5,416.9       $5,474.6
                                          ========       ========
Liabilities and stockholders' equity
------------------------------------
Current liabilities
Notes payable                             $   10.4       $   17.7

Current maturities of long-term debt         150.7            2.2
Accounts payable                             429.8          513.8
Other accrued liabilities                  1,240.0        1,305.7
Income taxes payable                         192.2          214.1
                                          --------       --------
Total                                      2,023.1        2,053.5
                                          --------       --------
Long-term debt                               901.8        1,048.3
Accrued pension liabilities                  460.1          433.6
Other long-term liabilities                  539.1          544.0

Stockholders' equity
Common stock, shares issued: 2004, 336.8;
   2003, 333.8                                 3.4            3.3
Accumulated deficit                       (  366.4)      (  414.8)
Other capital                              3,856.9        3,818.6
Accumulated other comprehensive loss      (2,001.1)      (2,011.9)
                                          --------       --------
Stockholders' equity                       1,492.8        1,395.2
                                          --------       --------
Total                                     $5,416.9       $5,474.6
                                          ========       ========

See notes to consolidated financial statements.







<PAGE> 3

                              UNISYS CORPORATION
                CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
                     (Millions, except per share data)


 
                                       Three Months             Six Months
                                       Ended June 30           Ended June 30
                                     -----------------      ------------------
                                       2004      2003         2004      2003
                                     --------  --------     --------  --------
Revenue   
  Services                           $1,158.8  $1,163.4     $2,323.8  $2,270.4 
  Technology                            229.3     261.6        527.2     553.5 
                                     --------  --------     --------  --------
                                      1,388.1   1,425.0      2,851.0   2,823.9 
Costs and expenses
  Cost of revenue: 
    Services                            930.2     906.8      1,855.9   1,789.3 
    Technology                           90.8     126.1        236.5     255.4 
                                     --------  --------     --------  --------
                                      1,021.0   1,032.9      2,092.4   2,044.7 
  Selling, general and
    administrative expenses             272.9     242.4        534.1     486.1 
  Research and development expenses      71.3      63.7        142.8     130.5 
                                     --------  --------     --------  --------
                                      1,365.2   1,339.0      2,769.3   2,661.3 
                                     --------  --------     --------  --------
Operating income                         22.9      86.0         81.7     162.6 

Interest expense                         18.2      18.4         35.2      34.1 
Other income (expense), net              24.0      10.6         24.6       7.2 
                                     --------  --------     --------  --------
Income before income taxes               28.7      78.2         71.1     135.7 
Provision for income taxes                9.3      25.7         22.8      44.7 
                                     --------  --------     --------  --------
Net income                           $   19.4  $   52.5     $   48.3  $   91.0 
                                     ========  ========     ========  ========

Earnings per share
  Basic                              $    .06  $    .16     $    .14  $    .28
                                     ========  ========     ========  ========
  Diluted                            $    .06  $    .16     $    .14  $    .28
                                     ========  ========     ========  ========





See notes to consolidated financial statements.

                                                








<PAGE> 4

                           UNISYS CORPORATION
               CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
                                (Millions)

                                                    Six Months Ended
                                                         June 30
                                                    -----------------
                                                      2004       2003
                                                    --------   -------
                                                      
Cash flows from operating activities
Net income                                         $   48.3   $   91.0         
Add(deduct) items to reconcile net income
   to net cash provided by operating activities:           
Depreciation and amortization of properties and
   outsourcing assets                                 123.1      105.4         
Amortization of marketable software                    62.9       59.9       
(Increase) in deferred income taxes, net             (  2.4)    (  1.5) 
Decrease (increase) in receivables, net               185.3     (  6.6)     
Decrease in inventories                                 6.4       19.5     
(Decrease) in accounts payable and other
   accrued liabilities                               (172.2)    (177.5)    
(Decrease) increase in income taxes payable          ( 21.9)      17.5         
Increase (decrease) in other liabilities                3.5     ( 14.8)       
(Increase) in other assets                           ( 27.8)    ( 39.1)       
Other                                                   8.8     (  5.6)       
                                                    -------     ------
Net cash provided by operating activities             214.0       48.2     
                                                    -------     ------
Cash flows from investing activities
   Proceeds from investments                        2,878.8    2,387.5        
   Purchases of investments                        (2,879.0)  (2,421.7)     
   Investment in marketable software                 ( 60.5)    ( 76.9)     
   Capital additions of properties and
     outsourcing assets                              (143.5)    (112.0)     
   Purchases of businesses                           ( 12.6)    (  2.0)    
                                                    -------     ------
Net cash used for investing activities               (216.8)    (225.1)    
                                                    -------     ------
Cash flows from financing activities
   Net reduction in short-term borrowings             (10.6)    ( 59.6)      
   Proceeds from employee stock plans                  24.0       13.9      
   Payments of long-term debt                        (  1.7)    (  3.0)
   Proceeds from issuance of long-term debt                      293.3      
                                                    -------     ------

Net cash provided by financing activities              11.7      244.6     
                                                    -------     ------
Effect of exchange rate changes on 
   cash and cash equivalents                          ( 1.4)      12.3     
                                                    -------     ------

Increase in cash and cash equivalents                   7.5       80.0   
Cash and cash equivalents, beginning of period        635.9      301.8   
                                                    -------    -------
Cash and cash equivalents, end of period            $ 643.4    $ 381.8  
                                                    =======    =======


See notes to consolidated financial statements.
                                               






<PAGE> 5

UNISYS CORPORATION 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

In the opinion of management, the financial information furnished
herein reflects all adjustments necessary for a fair presentation of
the financial position, results of operations and cash flows for the
interim periods specified.  These adjustments consist only of normal
recurring accruals.  Because of seasonal and other factors, results
for interim periods are not necessarily indicative of the results to
be expected for the full year.

a. The following table shows how earnings per share were computed for the
   three and six months ended June 30, 2004 and 2003 (dollars in millions,
   shares in thousands):
                                  Three Months Ended       Six Months Ended   
                                       June 30                 June 30
                                  ------------------      ------------------ 
                                    2004       2003         2004       2003
                                  -------    -------      -------    -------
    Basic Earnings Per Share
    
    Net income                    $  19.4    $  52.5      $  48.3    $  91.0
                                  =======    =======      =======    =======
    Weighted average shares       334,411    328,783      333,567    327,996  
                                  =======    =======      =======    =======
    Basic earnings per share      $   .06    $   .16      $   .14    $   .28
                                  =======    =======      =======    =======
    Diluted Earnings Per Share
    
    Net income                    $  19.4    $  52.5      $  48.3    $  91.0
                                  =======    =======      =======    =======
    Weighted average shares       334,411    328,783      333,567    327,996  
    Plus incremental shares 
      from assumed exercises
      under employee stock plans    4,356      2,366        4,840      1,991  
                                  -------    -------      -------    -------
    Adjusted weighted average
      shares                      338,767    331,149      338,407    329,987 
                                  =======    =======      =======    =======
    Diluted earnings per share    $   .06    $   .16      $   .14    $   .28
                                  =======    =======      =======    =======

    At June 30, 2004, 25.8 million shares related to employee stock plans were 
    not included in the computation of diluted earnings per share because the 
    option prices are above the average market price of the company's common 
    stock.

b.  The company has two business segments:  Services and Technology.  Revenue
    classifications by segment are as follows:  Services - consulting and   
    systems integration, outsourcing, infrastructure services and core
    maintenance; Technology - enterprise-class servers and specialized 
    technologies.  The accounting policies of each business segment are the same
    as those followed by the company as a whole.  Intersegment sales and 
    transfers are priced as if the sales or transfers were to third parties.  
    Accordingly, the Technology segment recognizes intersegment revenue and 
    manufacturing profit on hardware and software shipments to customers under 
    Services contracts.  The Services segment, in turn, recognizes customer 
    revenue and marketing profits on such shipments of company hardware and 
    software to customers.  The Services segment also includes the sale of 
    hardware and software products sourced from third parties that are sold to 
    customers through the company's Services channels.  In the company's 
    consolidated statements of income, the manufacturing costs of products 
    sourced from the Technology segment and sold to Services customers are 
    reported in cost of revenue for Services.  

    Also included in the Technology segment's sales and operating profit are 
    sales of hardware and software sold to the Services segment for internal use
    in Services engagements.  The amount of such profit included in operating 
    income of the Technology segment for the three and six months ended June 30,
    2004 and 2003 was $1.3 million and $11.5 million, and $2.6 million and $14.6
    million, respectively.  The profit on these transactions is eliminated in 
    Corporate.  



<PAGE> 6

    The company evaluates business segment performance on operating income 
    exclusive of restructuring charges and unusual and nonrecurring items, which
    are included in Corporate.  All other corporate and centrally incurred costs
    are allocated to the business segments based principally on revenue, 
    employees, square footage or usage.

    A summary of the company's operations by business segment for the three and
    six month periods ended June 30, 2004 and 2003 is presented below (in
    millions of dollars):

                              Total    Corporate    Services    Technology
    Three Months Ended        -----    ---------    --------    ----------
      June 30, 2004
    ------------------
    Customer revenue         $1,388.1               $1,158.8     $  229.3   
    Intersegment                        $( 57.3)         4.5         52.8
                             --------   -------     --------     --------
    Total revenue            $1,388.1   $( 57.3)    $1,163.3     $  282.1
                             ========   =======     ========     ========
    Operating income (loss)  $   22.9   $(   .4)    $    8.2     $   15.1
                             ========   =======     ========     ========
    Three Months Ended        
      June 30, 2003
    ------------------
    Customer revenue         $1,425.0               $1,163.4     $  261.6   
    Intersegment                        $( 89.2)         6.3         82.9
                             --------   -------     --------     --------
    Total revenue            $1,425.0   $( 89.2)    $1,169.7     $  344.5
                             ========   =======     ========     ========
    Operating income (loss)  $   86.0   $(  4.9)    $   64.1     $   26.8
                             ========   =======     ========     ========
    Six Months Ended
     June 30, 2004
    ----------------
    Customer revenue         $2,851.0               $2,323.8     $  527.2
    Intersegment                        $(103.0)         9.3         93.7
                             --------   -------     --------     --------
    Total revenue            $2,851.0   $(103.0)    $2,333.1     $  620.9
                             ========   =======     ========     ========
    Operating income (loss)  $   81.7   $    -      $   37.4     $   44.3
                             ========   =======     ========     ========
    Six Months Ended  
     June 30, 2003
    ------------------
    Customer revenue         $2,823.9               $2,270.4     $  553.5
    Intersegment                        $(159.2)        11.9        147.3
                             --------   -------     --------     --------
    Total revenue            $2,823.9   $(159.2)    $2,282.3     $  700.8
                             ========   =======     ========     ========
    Operating income (loss)  $  162.6   $(  2.3)    $   98.5     $   66.4
                             ========   =======     ========     ========

    Presented below is a reconciliation of total business segment operating
    income to consolidated income before taxes (in millions of dollars):

   
                                       Three Months Ended   Six Months Ended
                                             June 30,           June 30,
                                       ------------------   ----------------
                                         2004      2003       2004      2003
                                         ----      ----       ----      ----
   Total segment operating income       $ 23.3    $ 90.9     $ 81.7    $164.9 
   Interest expense                      (18.2)    (18.4)     (35.2)    (34.1)
   Other income (expense), net            24.0      10.6       24.6       7.2 
   Corporate and eliminations            (  .4)    ( 4.9)        -      ( 2.3)
                                        ------    ------     ------    ------
   Total income before income taxes     $ 28.7    $ 78.2     $ 71.1    $135.7 
                                        ======    ======     ======    ======


   




<PAGE> 7

   Customer revenue by classes of similar products or services, by segment, is
   presented below:     
                                     Three Months Ended      Six Months Ended
                                          June 30,                June 30,
                                     ------------------    ------------------
                                        2004       2003        2004      2003
                                        ----       ----        ----      ----
   Services
     Consulting and systems
       integration                    $  413.9  $  386.0    $  791.0  $  742.4 
     Outsourcing                         419.4     421.8       862.4     831.1 
     Infrastructure services             180.0     211.8       379.5     412.6 
     Core maintenance                    145.5     143.8       290.9     284.3 
                                      --------  --------    --------   -------
                                       1,158.8   1,163.4     2,323.8   2,270.4 
   Technology
     Enterprise-class servers            185.5     193.8       387.3     411.6 
     Specialized technologies             43.8      67.8       139.9     141.9 
                                      --------  --------    --------  --------
                                         229.3     261.6       527.2     553.5 
                                      --------  --------    --------  --------
   Total                              $1,388.1  $1,425.0    $2,851.0  $2,823.9 
                                      ========  ========    ========  ========

c. Comprehensive income for the three and six months ended June 30, 2004 and
   2003 includes the following components (in millions of dollars):

                                      Three Months Ended   Six Months Ended
                                             June 30,           June 30,
                                       ------------------   ----------------
                                         2004      2003       2004      2003
                                         ----      ----       ----      ----
   Net income                           $ 19.4    $ 52.5     $ 48.3    $ 91.0 
 
   Other comprehensive income (loss)
    Cash flow hedges
     Income (loss), net of tax of        
      $1.4, $(2.6), $.4, and $(2.6)        2.5      (4.7)        .9      (4.8)
     Reclassification adjustments,
      net of tax of $(.1), $1.0 ,$1.6,     
      and $2.0                             (.2)      1.7        2.9       3.8 
     Foreign currency translation         
       adjustments                       (13.2)     38.6        7.0      30.9 
                                        ------    ------     ------    ------
     Total other comprehensive
       income (loss)                     (10.9)     35.6       10.8      29.9 
                                        ------    ------     ------    ------
     Comprehensive income               $  8.5    $ 88.1     $ 59.1    $120.9 
                                        ======    ======     ======    ======
   

    Accumulated other comprehensive income (loss) as of December 31, 2003 and
    June 30, 2004 is as follows (in millions of dollars):

                                                            Cash    Minimum
                                              Translation   Flow    Pension
                                     Total    Adjustments  Hedges  Liability
                                     -----    -----------  ------  ---------
    Balance at December 31, 2002   $(2,236.9)  $(745.0)   $( 1.5) $(1,490.4)  
    Change during period               225.0      65.3     ( 5.1)     164.8
                                   ---------   -------    ------  ---------
    Balance at December 31, 2003    (2,011.9)   (679.7)    ( 6.6)  (1,325.6) 
    Change during period                10.8       7.0       3.8
                                   ---------   -------    ------  ---------
    Balance at June 30, 2004       $(2,001.1)  $(672.7)   $ (2.8) $(1,325.6)
                                   =========   =======    ======  =========


d.  The amount credited to stockholders' equity for the income tax benefit
    related to the company's stock plans for the six months ended June 30,
    2004 and 2003 was $2.9 million and $1.8 million, respectively. The company
    expects to realize these tax benefits on future Federal income tax returns.



<PAGE> 8

e.  For equipment manufactured by the company, the company warrants that it will
    substantially conform to relevant published specifications for 12 months
    after shipment to the customer.  The company will repair or replace, at its
    option and expense, items of equipment that do not meet this warranty.  For
    company software, the company warrants that it will conform substantially to
    then-current published functional specifications for 90 days from customer's
    receipt.  The company will provide a workaround or correction for material 
    errors in its software that prevents its use in a production environment.

    The company estimates the costs that may be incurred under its warranties
    and records a liability in the amount of such costs at the time revenue is
    recognized.  Factors that affect the company's warranty liability include
    the number of units sold, historical and anticipated rates of warranty
    claims and cost per claim.  The company quarterly assesses the adequacy of
    its recorded warranty liabilities and adjusts the amounts as necessary.
    Presented below is a reconciliation of the aggregate product warranty
    liability (in millions of dollars):
                                         Three Months Ended  Six Months Ended
                                               June 30,         June 30,      
                                         ------------------  ----------------
                                           2004    2003        2004    2003
                                           ----    ----        ----    ----
    Balance at beginning
      of period                           $17.9   $19.3       $20.8   $19.2   
    
    Accruals for warranties issued
      during the period                     2.1     6.8         7.1    11.7  

    Settlements made during the
      period                               (4.2)   (4.4)       (8.9)   (9.1)

    Changes in liability for 
      pre-existing warranties during
      the period, including expirations     (.8)    (.6)       (4.0)    (.7)
                                          -----   -----       -----   -----
    Balance at June 30                    $15.0   $21.1       $15.0   $21.1   
                                          =====   =====       =====   =====

f.  The company applies the recognition and measurement principles of APB
    Opinion No. 25, "Accounting for Stock Issued to Employees," and related
    interpretations in accounting for its stock-based employee compensation
    plans.  For stock options, no compensation expense is reflected in net
    income as all stock options granted had an exercise price equal to or
    greater than the market value of the underlying common stock on the date
    of grant.  In addition, no compensation expense is recognized for common
    stock purchases under the Employee Stock Purchase Plan.  Pro forma
    information regarding net income and earnings per share is required by
    Statement of Financial Accounting Standards ("SFAS") No. 123, "Accounting
    for Stock-Based Compensation," and has been determined as if the company
    had accounted for its stock plans under the fair value method of SFAS No. 
    123.  For purposes of the pro forma disclosures, the estimated fair value of
    the options is amortized to expense over the options' vesting period.  The
    following table illustrates the effect on net income and earnings per share
    if the company had applied the fair value recognition provisions of SFAS No.
    123 (in millions of dollars):
                                       Three Months Ended   Six Months Ended
                                             June 30,           June 30,
                                       ------------------   ----------------
                                         2004      2003       2004      2003
                                         ----      ----       ----      ----
   Net income as reported               $ 19.4    $ 52.5     $ 48.3    $ 91.0 
   Deduct total stock-based employee
     compensation expense determined
     under fair value method for all
     awards, net of tax                  ( 7.7)    (10.3)     (17.7)    (24.8)
                                        ------    ------     ------    ------
   Pro forma net income                 $ 11.7    $ 42.2     $ 30.6    $ 66.2
                                        ======    ======     ======    ======
   Earnings per share
     Basic - as reported                $  .06    $  .16     $  .14    $  .28
     Basic - pro forma                  $  .03    $  .13     $  .09    $  .20
     Diluted - as reported              $  .06    $  .16     $  .14    $  .28
     Diluted - pro forma                $  .03    $  .13     $  .09    $  .20
    

<PAGE> 9

g.  Net periodic pension expense (income) for the three and six months ended 
    June 30, 2004 and 2003 is presented below (in millions of dollars):

                                     Three Months             Three Months
                                 Ended June 30, 2004     Ended June 30, 2003
                                ----------------------   ----------------------
                                        U.S.    Int'l.            U.S.    Int'l.
                                Total   Plans   Plans    Total    Plans   Plans
                                -----   -----   -----    -----    -----   -----

    Service cost               $ 28.6  $ 16.5   $ 12.1  $ 23.5   $ 13.5  $ 10.0
    Interest cost                90.7    66.7     24.0    86.7     66.6    20.1
    Expected return on
      plan assets              (123.3)  (94.7)   (28.6) (125.7)  (101.0)  (24.7)
    Amortization of prior
      service (benefit) cost     (1.6)   (1.9)      .3    (2.5)    (3.0)    0.5
    Recognized net actuarial 
      loss                       30.4    24.3      6.1     8.9      4.9     4.0
    Settlement/curtailment
      loss                                                 1.2              1.2
                                -----   -----   ------   ------   ------  -----
    Net periodic pension
      expense (income)          $24.8  $ 10.9   $ 13.9  $ (7.9)  $ (19.0)$ 11.1 
                                =====  ======   ======  =======   ======  =====

                                     Six Months               Six Months
                                 Ended June 30, 2004       Ended June 30, 2003
                                ----------------------   ----------------------
                                        U.S.    Int'l.            U.S.    Int'l.
                                Total   Plans   Plans    Total    Plans   Plans
                                -----   -----   -----    -----    -----   -----

    Service cost               $ 57.9  $ 33.6   $ 24.3  $ 48.7   $ 29.4  $ 19.3 
    Interest cost               180.2   132.3     47.9   173.4    133.6    39.8
    Expected return on
      plan assets              (246.8) (189.5)   (57.3) (251.1)  (201.8)  (49.3)
    Amortization of prior
      service (benefit) cost     (3.0)   (3.8)      .8    (5.3)    (6.0)    0.7
    Recognized net actuarial 
      loss                       58.7    46.5     12.2    17.8     10.4     7.4
    Settlement/curtailment
      loss                                                2.2               2.2
                                -----   -----   ------   ------   ------  -----
    Net periodic pension
      expense (income)          $47.0   $19.1   $ 27.9  $(14.3)  $(34.4) $ 20.1 
                                =====   =====   ======  =======   ======  =====

    The company currently expects to make cash contributions of approximately 
    $70 million to its worldwide defined benefit pension plans in 2004 compared
    with $62.5 million in 2003.  For the six months ended June 30, 2004 and
    2003, $27.5 million and $22.7 million, respectively of cash contributions 
    have been made.  In accordance with regulations governing contributions to 
    U.S. defined benefit pension plans, the company is not required to fund its 
    U.S. qualified defined benefit pension plan in 2004.

    Net periodic postretirement benefit expense for the three and six months
    ended June 30, 2004 and 2003 is presented below (in millions of dollars):

                                               Three Months    Six Months
                                               Ended June 30,  Ended June 30,
                                               --------------  --------------
                                                 2004    2003   2004    2003
                                                 ----    ----   ----    ----
    Interest cost                               $ 3.5   $ 3.6  $  7.0   $ 7.2
    Amortization of prior service benefit         (.5)    (.5)   (1.0)   (1.0)
    Recognized net actuarial loss                 1.0      .7     2.0     1.4
                                                -----   -----   -----   -----
    Net periodic postretirement benefit   
      expense                                   $ 4.0   $ 3.8   $ 8.0   $ 7.6
                                                =====   =====   =====   =====

    The company expects to make cash contributions of approximately $25 million
    to its postretirement benefit plan in 2004.  For the six months ended
    June 30, 2004, $14 million of cash contributions have been made.

<PAGE> 10


h.  Substantially all of the company's investments at equity consist of Nihon
    Unisys, Ltd., a publicly traded Japanese company ("NUL").  NUL is the 
    exclusive supplier of the company's hardware and software products in Japan.
    The company owns approximately 28% of NUL's outstanding common stock.  Prior
    to January 1, 2004, the company's share of NUL's earnings or losses were 
    recorded semiannually in the second quarter and fourth quarter on a quarter-
    lag basis since NUL's quarterly financial results were not available.  Due
    to recent regulatory changes in Japan, NUL is required to publish its
    earnings quarterly.  Accordingly, effective January 1, 2004, the company has
    begun to record its equity earnings in NUL quarterly on a quarter-lag basis,
    and recorded equity income of $9.1 million and $14.4 million for the three
    and six months ended June 30, 2004, respectively. 
    
i.  Cash paid during the six months ended June 30, 2004 and 2003 for income
    taxes was $35.7 million and $42.2 million, respectively.

    Cash paid during the six months ended June 30, 2004 and 2003 for interest
    was $42.7 million and $33.8 million, respectively.

j.  In November 2003, the company purchased KPMG's Belgian consulting business 
    for approximately $3.3 million of cash plus assumed liabilities.  The 
    preliminary purchase price allocation was completed in December 2003 and 
    assumed that the excess of the purchase price over the assets acquired and 
    liabilities assumed was allocated to goodwill.  An outside appraisal company
    completed its appraisal during the March 2004 quarter.  Approximately $1.5 
    million of amortizable intangibles (principally customer relationships) were
    identified and recorded.  The intangible assets have a weighted average life
    of approximately 5.5 years. The goodwill from this acquisition has been
    assigned to the Services segment.
 
    In April 2004, the company purchased the document services business unit of 
    Interpay Nederlands B.V. ("Interpay") for $5.2 million.  This business unit 
    processes approximately 110 million paper-related payments a year for Dutch 
    banks.  The purchase price was allocated to assets acquired and liabilities 
    assumed based on their estimated fair values, and resulted in goodwill of 
    $3.4 million.  The acquisition provides for the company to make contingent 
    payments to Interpay based on the achievement of certain future revenue 
    levels.  The contingent consideration will be recorded as additional 
    goodwill when the contingencies are resolved and consideration is issued or 
    becomes issuable.  The goodwill from this acquisition has been assigned to 
    the Services segment.

    In June 2004, the company purchased the security services and identity and 
    access management solutions business of ePresence, Inc., whose consultants 
    design and implement enterprise directory and security solutions that enable
    identity management within and across organizations.  The purchase price of
    $10.6 million will be allocated to assets acquired and liabilities assumed 
    based on their estimated fair values.  The preliminary allocation of the 
    purchase price assumes that the excess of the purchase price over the assets
    acquired and liabilities assumed of $8.2 million will be allocated to 
    goodwill.  There can be no assurance that this preliminary allocation will 
    represent the final purchase price allocation.  The purchase price 
    allocation will be completed within the next few months after finalization 
    of appraisals.  The goodwill from this acquisition has been assigned to the 
    Services segment.

k.  In January 2003, the Financial Accounting Standards Board ("FASB") issued
    interpretation No. 46 ("FIN 46"), "Consolidation of Variable Interest
    Entities, an interpretation of ARB 51."  The primary objectives of this
    interpretation are to provide guidance on the identification of entities for
    which control is achieved through means other than through voting rights
    ("variable interest entities") and how to determine when and which business
    enterprise (the "primary beneficiary") should consolidate the variable
    interest entity.  This new model for consolidation applies to an entity in
    which either (i) the equity investors (if any) do not have a controlling
    financial interest, or (ii) the equity investment at risk is insufficient to
    finance that entity's activities without receiving additional subordinated 
    financial support from other parties.  In addition, FIN 46 requires that the
    primary beneficiary, as well as all other enterprises with a significant 
    variable interest in a variable interest entity, make additional 
    disclosures.  Certain disclosure requirements of FIN 46 were effective for 
    financial statements issued after January 31, 2003.  In December 2003, the 
    FASB issued FIN 46 (revised December 2003), "Consolidation of Variable 
    Interest Entities" ("FIN 46-R") to address certain FIN 46 implementation 
    issues.



<PAGE> 11

    The provisions of FIN 46 were applicable for variable interests in entities
    obtained after January 31, 2003.  The adoption of the provisions applicable
    to special purpose entities ("SPE") and all other variable interests 
    obtained after January 31, 2003 did not have a material impact on the
    company's consolidated financial position, consolidated results of 
    operations, or liquidity.

    Effective March 31, 2004, the company adopted the provisions of FIN 46-R
    applicable to Non-SPEs created prior to February 1, 2003.  Adoption of
    FIN 46-R had no impact on the company's consolidated financial position, 
    consolidated results of operations, or liquidity. 


    On May 19, 2004, the FASB issued Staff Position No. FAS 106-2, "Accounting 
    and Disclosure Requirements Related to the Medicare Prescription Drug, 
    Improvement and Modernization Act of 2003", ("FSP No. 106-2").  The above 
    Act introduces a prescription drug benefit under Medicare as well as a 
    federal subsidy to sponsors of retiree health care benefit plans that 
    provide a benefit that is at least actuarially equivalent to Medicare Part 
    D.  FSP No. 106-2 is effective for the first interim period beginning after 
    June 15, 2004 and provides that an employer shall measure the accumulated 
    plan benefit obligation ("APBO") and net periodic postretirement benefit 
    cost taking into account any subsidy received under the Act.  As of June 30,
    2004, the company's measurements of both the APBO and the net postretirement
    benefit cost do not reflect any amounts associated with the subsidy because 
    the company has not yet been able to conclude whether the benefits provided 
    by its postretirement medical plan are actuarially equivalent to Medicare 
    Part D under the Act.









<PAGE> 12



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


Results of Operations
---------------------

The company experienced a slowdown in certain areas of its business, 
particularly in infrastructure services and in enterprise servers in the second 
quarter of 2004.  This resulted in deferrals and delays of some technology 
contracts and services projects late in the quarter, leading to lower-than-
anticipated results for the period.  

For the three months ended June 30, 2004, the company reported net income of 
$19.4 million, or $.06 per share, compared with $52.5 million, or $.16 per 
share, for the three months ended June 30, 2003.

Total revenue for the quarter ended June 30, 2004 was $1.39 billion, down 3% 
from revenue of $1.43 billion for the quarter ended June 30, 2003.  Foreign 
currency translations had a 4% positive impact on revenue in the quarter when 
compared with the year-ago period.  In the current quarter, Services revenue 
was flat and Technology revenue decreased 12% from the prior year.

U.S. revenue decreased 5% in the current quarter compared with the year-ago 
period and revenue in international markets was flat as an increase in Europe 
was offset by declines in other international regions.  On a constant currency 
basis, international revenue declined 8% in the quarter.

Pension expense for the three months ended June 30, 2004 was $24.8 million 
compared with $7.9 million of pension income for the three months ended 
June 30, 2003.  The change was due to the following: (1) a decline in the 
discount rate used for the U.S. pension plan to 6.25% at December 31, 2003 
from 6.75% at December 31, 2002, (2) an increase in amortization of net 
unrecognized losses, (3) lower expected returns on plan assets due to 
amortization of the difference between the calculated value of plan assets and 
the fair value of plan assets, and (4) for international plans, declines in 
discount rates and currency translation.  The company records pension income 
or expense, as well as other employee-related costs such as FICA and medical 
insurance costs, in operating income in the following income statement 
categories: cost of sales; selling, general and administrative expenses; and 
research and development expenses.  The amount allocated to each income 
statement line is based on where the salaries of the active employees are 
charged.  The company currently expects to report pension expense of 
approximately $90 - $95 million in 2004 compared with pension income of $22.6 
million in 2003.

Total gross profit margin was 26.4% in the second quarter of 2004 compared with
27.5% in the year-ago period, the change principally reflected pension expense 
of $17.8 million in the current quarter compared with pension income of $1.5 
million in the year-ago quarter.

For the three months ended June 30, 2004, selling, general and administrative 
expenses were $272.9 million (19.7% of revenue) compared with $242.4 million 
(17.0% of revenue) for the three months ended June 30, 2003.  The increase 
principally reflected pension expense of $4.8 million in the current year 
compared with $2.4 million of pension income in the year-ago period as well as 
the impact of foreign currency exchange rates.

Research and development ("R&D") expense was $71.3 million compared with $63.7 
million a year ago.  The company continues to invest in high-end Cellular 
MultiProcessing server technology and in key programs within its industry 
practices.  R&D in the current period includes $2.2 million of pension expense 
compared with pension income of $4.0 million in the year-ago period.

For the second quarter of 2004, the company reported an operating income 
percent of 1.6% compared with 6.0% for the second quarter of 2003.  The change 
principally reflected pension expense of $24.8 million in the current quarter 
compared with pension income of $7.9 million in the year-ago period as well as 
lower revenue and higher selling, general and administrative expenses.

Interest expense for the three months ended June 30, 2004 was $18.2 million 
compared with $18.4 million for the three months ended June 30, 2003.  



<PAGE> 13

Other income (expense), net was income of $24.0 million in the current quarter 
compared with income of $10.6 million in the year-ago quarter.  The increase 
in income was principally due to foreign currency exchange gains of $1.5 
million in the current quarter compared with exchange losses of $6.9 million 
in the year-ago quarter.

Income before income taxes was $28.7 million in the second quarter of 2004 
compared with $78.2 million last year.  The provision for income taxes was 
$9.3 million in the current period compared with $25.7 million in the year-ago 
period.  The effective tax rate was 32% in 2004 and 33% in 2003.

For the six months ended June 30, 2004, the company reported net income of 
$48.3 million, or $.14 per share, compared with $91.0 million, or $.28 per 
share, for the six months ended June 30, 2003.

Total revenue for the six months ended June 30, 2004 was $2.85 billion, up 1% 
from revenue of $2.82 billion for the six months ended June 30, 2003.  Foreign 
currency translations had a 5% positive impact on revenue in the six months 
when compared with the year-ago period.  In the current six-month period, 
Services revenue increased 2% and Technology revenue decreased 5%.

U.S. revenue decreased 1% in the current six-month period compared with the 
year-ago period and revenue in international markets increased 3% driven by an 
increase in Europe which was partially offset by declines in other 
international regions.  On a constant currency basis, international revenue 
declined 7% in the six months ended June 30, 2004.

Pension expense for the six months ended June 30, 2004 was $47.0 million 
compared with $14.3 million of pension income for the six months ended June 30, 
2003.  

Total gross profit margin was 26.6% in the six months ended June 30, 2004 
compared with 27.6% in the year-ago period.  The change principally reflected 
pension expense of $33.3 million in the current period compared with pension 
income of $2.7 million in the year-ago period.

For the six months ended June 30, 2004, selling, general and administrative 
expenses were $534.1 million (18.7% of revenue) compared with $486.1 million 
(17.2% of revenue) for the six months ended June 30, 2003.

R&D expense for the six months ended June 30, 2004 was $142.8 million compared 
with $130.5  million a year ago.  R&D in the current period includes $4.0 
million of pension expense compared with pension income of $7.2 million in the 
year-ago period.

For the six months ended June 30, 2004, the company reported an operating 
income percent of 2.9% compared with 5.8% for the six months ended June 30, 
2003.  The change principally reflected pension expense of $47.0 million in the
current period compared with pension income of $14.3 million in the year-ago 
period.

Interest expense for the six months ended June 30, 2004 was $35.2 million 
compared with $34.1 million for the six months ended June 30, 2003.  The 
increase in interest expense was due to higher borrowing levels in 2004.  

Other income (expense), net was income of $24.6 million in the current six-
month period compared with income of $7.2 million in the year-ago period.  The 
increase in income was principally due to foreign exchange losses of 
$.7 million in the current year compared with losses of $11.3 million in the 
prior-year period as well as Nihon Unisys Ltd. ("NUL") equity income of $14.4 
million in the current period compared with $10.2 million in the prior-year 
period.

Income before income taxes was $71.1 million in the six months ended June 30, 
2004 compared with $135.7 million last year.  The provision for income taxes 
was $22.8 million in the current period compared with $44.7 million in the year-
ago period.  The effective tax rate was 32% in 2004 and 33% in 2003.





<PAGE> 14

Segment results
---------------

The company has two business segments:  Services and Technology.  Revenue 
classifications are as follows:  Services - consulting and systems integration, 
outsourcing, infrastructure services, and core maintenance; Technology - 
enterprise-class servers and specialized technologies.  The accounting policies 
of each business segment are the same as those followed by the company as a 
whole.  Intersegment sales and transfers are priced as if the sales or 
transfers were to third parties.  Accordingly, the Technology segment recognizes
intersegment revenue and manufacturing profit on hardware and software 
shipments to customers under Services contracts.  The Services segment, in 
turn, recognizes customer revenue and marketing profit on such shipments of 
company hardware and software to customers.  The Services segment also includes 
the sale of hardware and software products sourced from third parties that are 
sold to customers through the company's Services channels.  In the company's 
consolidated statements of income, the manufacturing costs of products sourced 
from the Technology segment and sold to Services customers are reported in cost 
of revenue for Services.  

Also included in the Technology segment's sales and operating profit are sales 
of hardware and software sold to the Services segment for internal use in 
Services engagements.  The amount of such profit included in operating income 
of the Technology segment for the three months ended June 30, 2004 and 2003, 
was $1.3 million and $11.5 million, respectively.  The profit on these 
transactions is eliminated in Corporate.  

The company evaluates business segment performance on operating income 
exclusive of restructuring charges and unusual and nonrecurring items, which 
are included in Corporate.  All other corporate and centrally incurred costs 
are allocated to the business segments based principally on revenue, employees, 
square footage or usage.

Information by business segment is presented below (in millions of dollars):
                                                                     
                                       Elimi-    
                            Total      nations      Services    Technology
                           -------     -------      --------    ----------
Three Months Ended
June 30, 2004
------------------
Customer revenue          $1,388.1                  $1,158.8    $229.3
Intersegment                           $( 57.3)          4.5      52.8 
                          --------     -------      --------    ------      
Total revenue             $1,388.1     $( 57.3)     $1,163.3    $282.1
                          ========     =======      ========    ====== 

Gross profit percent          26.4%                     18.5%     53.3%
                          ========                  ========    ======
Operating income
     percent                   1.6%                       .7%      5.4%
                          ========                  ========    ======
Three Months Ended
June 30, 2003
------------------
Customer revenue          $1,425.0                  $1,163.4    $261.6
Intersegment                           $( 89.2)          6.3      82.9      
                          --------     -------      --------    ------      
Total revenue             $1,425.0     $( 89.2)     $1,169.7    $344.5
                          ========     =======      ========    ====== 
Gross profit percent          27.5%                     20.0%     46.6%
                          ========                  ========    ======
Operating income
     percent                   6.0%                      5.5%      7.8%
                          ========                  ========    ======

Gross profit percent and operating income percent are as a percent of total 
revenue.   
                                 




<PAGE> 15

In the Services segment, customer revenue was $1.16 billion for the three 
months ended June 30, 2004, compared with $1.16 billion for the three months 
ended June 30, 2003.  Foreign currency translations had about a 4% positive 
impact on Services revenue in the quarter when compared with the year-ago 
period.  In Services revenue there was a 7% increase in consulting and systems 
integration  ($414 million in 2004 compared with $386 million in 2003) and a 1% 
increase in core maintenance revenue ($146 million in 2004 compared with $143 
million in 2003).  Offsetting these increases was a decline of 15% in 
infrastructure services revenue ($180 million in 2004 compared with $212 
million in 2003).  Outsourcing revenue was flat ($419 million in 2004 compared 
with $422 million in 2003).  The decline in infrastructure services revenue was 
principally due to less project-based work in the current quarter compared with 
the year-ago quarter.  Services gross profit was 18.5% for the three months 
ended June 30, 2004 compared with 20.0% in the year-ago period.  This change 
was principally due to the impact of pension expense of $17.4 million in the 
current quarter compared with pension income of $.7 million in the year-ago 
period.  Services operating income percent was .7% for the three months ended 
June 30, 2004 compared with 5.5% last year.  This change was principally due 
to the impact of pension expense of $21.1 million in the current quarter 
compared with pension income of $3.2 million in the prior year as well as 
higher selling, and general and administrative expenses in the current quarter.

In the Technology segment, customer revenue was $229 million for the three 
months ended June 30, 2004, down 12% compared with $262 million for the three 
months ended June 30, 2003.  Foreign currency translations had about a 2% 
positive impact on Technology revenue in the quarter when compared with the 
year-ago period.  The decrease in revenue was due to a 35% decrease in sales of 
specialized technology products ($44 million in 2004 compared with $68 million 
in 2003) and a 4% decline in sales of enterprise-class servers ($185 million in 
2004 compared with $194 million in 2003).  The decrease in specialized 
technology revenue was caused by lower sales of semiconductor test systems and 
payment systems.  Sales of these systems can vary significantly from quarter to 
quarter depending on customer needs.  Technology gross profit was 53.3% for the 
three months ended June 30, 2004 compared with 46.6% in the year-ago period, 
and Technology operating income percent was 5.4% for the three months ended 
June 30, 2004 compared with 7.8% last year.  The gross profit increase 
primarily reflected a higher proportion of high-end, higher-margin products 
within the ClearPath product line.  The decline in operating income percent was 
principally due to pension expense of $3.7 million in the current period 
compared with pension income of $4.7 million in the prior-year period.

New Accounting Pronouncements
-----------------------------

In January 2003, the Financial Accounting Standards Board ("FASB") issued 
interpretation No. 46 ("FIN 46"), "Consolidation of Variable Interest Entities, 
an interpretation of ARB 51."  The primary objectives of this interpretation 
are to provide guidance on the identification of entities for which control is 
achieved through means other than through voting rights ("variable interest 
entities") and how to determine when and which business enterprise (the 
"primary beneficiary") should consolidate the variable interest entity.  This 
new model for consolidation applies to an entity in which either (i) the equity 
investors (if any) do not have a controlling financial interest, or (ii) the 
equity investment at risk is insufficient to finance that entity's activities 
without receiving additional subordinated financial support from other parties.
In addition, FIN 46 requires that the primary beneficiary, as well as all other 
enterprises with a significant variable interest in a variable interest entity, 
make additional disclosures. Certain disclosure requirements of FIN 46 were 
effective for financial statements issued after January 31, 2003.  In December 
2003, the FASB issued FIN 46 (revised December 2003), "Consolidation of Variable
Interest Entities" ("FIN 46-R") to address certain FIN 46 implementation issues.

The provisions of FIN 46 were applicable for variable interests in entities 
obtained after January 31, 2003.  The adoption of the provisions applicable to 
special purpose entities ("SPE") and all other variable interests obtained after
January 31, 2003 did not have a material impact on the company's consolidated 
financial position, consolidated results of operations, or liquidity.





<PAGE> 16

Effective March 31, 2004, the company adopted the provisions of FIN 46-R 
applicable to Non-SPEs created prior to February 1, 2003.  Adoption of FIN 46-R 
had no impact on the company's consolidated financial position, consolidated 
results of operations, or liquidity.    
                                                           
Financial Condition
-------------------

Cash and cash equivalents at June 30, 2004 were $643.4 million compared with 
$635.9 million at December 31, 2003.  

During the six months ended June 30, 2004, cash provided by operations was 
$214.0 million compared with $48.2 million for the six months ended June 30, 
2003.  Operating cash flow increased principally due to higher receivable 
collections and lower restructuring expenditures.  Cash expenditures in the six 
months ended June 30, 2004 related to prior-year restructuring charges (which 
are included in operating activities) were approximately $7 million compared 
with $45 million for the prior-year period, and are expected to be approximately
$6 million for the remainder of 2004 and $10 million in total for all subsequent
years, principally for work-force reductions and idle lease costs.  

Cash used for investing activities for the six months ended June 30, 2004 was  
$216.8 million compared with $225.1 million during the six months ended June 30,
2003.  The decrease in cash used was principally due to net purchases of 
investments of $.2 million in the current period compared with net purchases of 
$34.2 million in the prior-year period.  In addition, the current period 
investment in marketable software was $60.5 million compared with $76.9 million 
in the prior-year.  Capital additions were $143.5 million for the six months 
ended June 30, 2004 compared with $112.0 million in the prior-year period.  The 
increase in current year capital expenditures was principally due to additions 
of revenue-generating assets, particularly in the company's outsourcing 
business, as well as expenditures related to the move of the company's Federal 
headquarters into a new facility.  Cash expenditures for purchases of 
businesses was $12.6 million for the six months ended June 30, 2004 compared 
with $2.0 million in the prior year.

Cash provided by financing activities during the six months ended June 30, 2004 
was $11.7 million compared with $244.6 million in the prior year.  The prior 
period includes net proceeds from issuance of long-term debt of $293.3 million 
in connection with the company's issuance in March 2003 of $300 million of 
6 7/8% senior notes due 2010.

At June 30, 2004 and December 31, 2003, total debt was $1.1 billion.

The company has a $500 million credit agreement that expires in May 2006.  As 
of June 30, 2004, there were no borrowings under this facility, and the entire 
$500 million was available for borrowings.   Borrowings under the agreement 
bear interest based on the then-current LIBOR or prime rates and the company's 
credit rating.  The credit agreement contains financial and other covenants, 
including maintenance of certain financial ratios, a minimum level of net worth 
and limitations on certain types of transactions, which could reduce the amount 
the company is able to borrow.  Events of default under the credit agreement 
include failure to perform covenants, material adverse change, change of 
control and default under other debt aggregating at least $25 million.  If an 
event of default were to occur under the credit agreement, the lenders would be 
entitled to declare all amounts borrowed under it immediately due and payable.  
The occurrence of an event of default under the credit agreement could also 
cause the acceleration of obligations under certain other agreements and the 
termination of the company's U.S. trade accounts receivable facility, described 
below. 

In addition, the company and certain international subsidiaries have access to 
certain uncommitted lines of credit from various banks.  Other sources of short-
term funding are operational cash flows, including customer prepayments, and 
the company's U.S. trade accounts receivable facility.  Using this facility, 
the company sells, on an on-going basis, up to $225 million of its eligible 
U.S. trade accounts receivable through a wholly owned subsidiary, Unisys 
Funding Corporation I.  The facility is renewable annually at the purchasers' 
option and expires in December 2006.  At June 30, 2004, the company had sold 
$217 million of eligible receivables compared with $225 million at December 31, 
2003.




<PAGE> 17

At June 30, 2004, the company has met all covenants and conditions under its 
various lending and funding agreements.  Since the company believes that it 
will continue to meet these covenants and conditions, the company believes that 
it has adequate sources and availability of short-term funding to meet its 
expected cash requirements.  

The company may, from time to time, redeem, tender for, or repurchase its 
securities in the open market or in privately negotiated transactions depending 
upon availability, market conditions and other factors.

The company has on file with the Securities and Exchange Commission a 
registration statement covering $1.2 billion of debt or equity securities, 
which enables the company to be prepared for future market opportunities.

At June 30, 2004, the company had deferred tax assets in excess of deferred tax 
liabilities of $2,032 million.  For the reasons cited below, management 
determined that it is more likely than not that $1,586 million of such assets 
will be realized, therefore resulting in a valuation allowance of $446 million.
                                         
The company evaluates quarterly the realizability of its deferred tax assets 
and adjusts the amount of the related valuation allowance, if necessary.  The 
factors used to assess the likelihood of realization are the company's forecast 
of future taxable income, and available tax planning strategies that could be 
implemented to realize deferred tax assets. Approximately $4.8 billion of 
future taxable income (predominantly U.S.) is needed to realize all of the net 
deferred tax assets.  Failure to achieve forecasted taxable income might affect 
the ultimate realization of the net deferred tax assets.  See "Factors That May 
Affect Future Results" below. 

Stockholders' equity increased $97.6 million during the six months ended June 
30, 2004, principally reflecting net income of $48.3 million, $35.4 million for 
issuance of stock under stock option and other plans, $2.9 million of tax 
benefits related to employee stock plans and currency translation of $7.0 
million. 

At December 31 of each year, accounting rules require a company to recognize a 
liability on its balance sheet for each defined benefit pension plan if the 
fair value of the assets of that pension plan is less than the present value of 
the pension obligation (the accumulated benefit obligation, or "ABO").  This 
liability is called a "minimum pension liability."  Concurrently, any existing 
prepaid pension asset for the pension plan must be removed.  These adjustments 
are recorded as a charge in "accumulated other comprehensive income (loss)" in 
stockholders' equity.  If at any future year-end, the fair value of the pension 
plan assets exceeds the ABO, the charge to stockholders' equity would be 
reversed for such plan.  Alternatively, if the fair market value of pension 
plan assets experiences further declines or the discount rate is reduced, 
additional charges to accumulated other comprehensive income (loss) may be 
required at a future year-end.

At December 31, 2002, for all of the company's defined benefit pension plans, 
the ABO exceeded the fair value of pension plan assets.  At December 31, 2003, 
the difference between the ABO and the fair value of pension plan assets 
decreased.  As a result, at December 31, 2003, the company adjusted its minimum 
pension liability as follows:  decreased its pension plan liabilities by 
approximately $300 million, increased its investments at equity by approximately
$6 million relating to the company's share of the change in NUL's minimum 
pension liability, decreased prepaid pension asset by $56 million, and offset 
these changes by a credit to other comprehensive income of approximately $250 
million, or $165 million net of tax.

This accounting has no effect on the company's net income, liquidity or cash 
flows.  Financial ratios and net worth covenants in the company's credit 
agreements and debt securities are unaffected by charges or credits to 
stockholders' equity caused by adjusting a minimum pension liability.

In accordance with regulations governing contributions to U.S. defined benefit 
pension plans, the company is not required to fund its U.S. qualified defined 
benefit plan in 2004.  The company expects to make cash contributions of 
approximately $70 million to its other defined benefit pension plans during 
2004.  





<PAGE> 18

Factors That May Affect Future Results
--------------------------------------

From time to time, the company provides information containing "forward-
looking" statements, as defined in the Private Securities Litigation Reform Act 
of 1995. Forward-looking statements provide current expectations of future 
events and include any statement that does not directly relate to any 
historical or current fact. Words such as "anticipates," "believes," "expects," 
"intends," "plans," "projects" and similar expressions may identify such 
forward-looking statements. All forward-looking statements rely on assumptions 
and are subject to risks, uncertainties and other factors that could cause the 
company's actual results to differ materially from expectations. These other 
factors include, but are not limited to, those discussed below. Any forward-
looking statement speaks only as of the date on which that statement is made. 
The company assumes no obligation to update any forward-looking statement to 
reflect events or circumstances that occur after the date on which the 
statement is made.

The company's business is affected by changes in general economic and business 
conditions. The company continues to face a highly competitive business 
environment and economic weakness in certain geographic regions.  In this 
environment, many organizations are delaying planned purchases of information 
technology products and services. If the level of demand for the company's 
products and services declines in the future, the company's business could be 
adversely affected. The company's business could also be affected by acts of 
war, terrorism or natural disasters. Current world tensions could escalate and 
this could have unpredictable consequences on the world economy and on our 
business.

The information services and technology markets in which the company operates 
include a large number of companies vying for customers and market share both 
domestically and internationally.  The company's competitors include consulting 
and other professional services firms, systems integrators, outsourcing 
providers, infrastructure services providers, computer hardware manufacturers 
and software providers. Some of the company's competitors may develop competing 
products and services that offer better price performance or that reach the
market in advance of the company's offerings. Some competitors also have or may 
develop greater financial and other resources than the company, with enhanced 
ability to compete for market share, in some instances through significant 
economic incentives to secure contracts. Some also may be better able to 
compete for skilled professionals. Any of these factors could have an adverse 
effect on the company's business. Future results will depend on the company's 
ability to mitigate the effects of aggressive competition on revenues, pricing 
and margins and on the company's ability to attract and retain talented people.

The company operates in a highly volatile industry characterized by rapid 
technological change, evolving technology standards, short product life cycles 
and continually changing customer demand patterns. Future success will depend 
in part on the company's ability to anticipate and respond to these market 
trends and to design, develop, introduce, deliver or obtain new and innovative 
products and services on a timely and cost-effective basis. The company may not 
be successful in anticipating or responding to changes in technology, industry 
standards or customer preferences, and the market may not demand or accept its 
services and product offerings. In addition, products and services developed by 
competitors may make the company's offerings less competitive.

The company's future results will depend in part on its ability to grow 
outsourcing and infrastructure services. The company's outsourcing contracts 
are multiyear engagements under which the company takes over management of a 
client's technology operations, business processes or networks. The company 
will need to maintain a strong financial position in order to grow its 
outsourcing business. In a number of these arrangements, the company hires 
certain of its clients' employees and may become responsible for the related 
employee obligations, such as pension and severance commitments.

In addition, system development activity on outsourcing contracts may require 
the company to make significant upfront investments. As long-term relationships,
these outsourcing contracts provide a base of recurring revenue. However, in 
the early phases of these contracts, gross margins may be lower than in later 
years when the work force and facilities have been rationalized for efficient 
operations, and an integrated systems solution has been implemented. Future 
results will depend on the company's ability to effectively complete the 
rationalizations and solution implementations.


<PAGE> 19

Future results will also depend in part on the company's ability to drive 
profitable growth in consulting and systems integration.  The company's ability 
to grow profitably in this business will depend in part on an improvement in 
economic conditions and a pick-up in demand for systems integration projects. 
It will also depend on the success of the actions the company has taken to 
enhance the skills base and management team in this business and to refocus the 
business on integrating best-of-breed, standards-based solutions to solve 
client needs. In addition, profit margins in this business are largely a 
function of the rates the company is able to charge for services and the 
chargeability of its professionals. If the company is unable to maintain the 
rates it charges or appropriate chargeability for its professionals, profit 
margins will suffer.  The rates the company is able to charge for services are 
affected by a number of factors, including clients' perception of the company's 
ability to add value through its services; introduction of new services or 
products by the company or its competitors; pricing policies of competitors; 
and general economic conditions. Chargeability is also affected by a number of 
factors, including the company's ability to transition employees from completed 
projects to new engagements, and its ability to forecast demand for services 
and thereby maintain an appropriate head count.

Future results will also depend, in part, on market acceptance of the company's 
high-end enterprise servers. In its technology business, the company is 
focusing its resources on high-end enterprise servers based on its Cellular 
MultiProcessing (CMP) architecture. The company's CMP servers are designed to 
provide mainframe-class capabilities with compelling price-performance by 
making use of standards-based technologies such as Intel chips and Microsoft 
operating system software. The company has transitioned both its legacy 
ClearPath servers and its Intel-based ES7000s to the CMP platform, creating a 
common platform for all the company's high-end server lines. Future results 
will depend, in part, on customer acceptance of the new CMP-based ClearPath 
Plus systems and the company's ability to maintain its installed base for 
ClearPath and to develop next-generation ClearPath products that are purchased 
by the installed base.  In addition, future results will depend, in part, on 
the company's ability to generate new customers and increase sales of the Intel-
based ES7000 line. The company believes there is significant growth potential 
in the developing market for high-end, Intel-based servers running Microsoft 
operating system software. However, competition in this new market is likely to 
intensify in coming years, and the company's ability to succeed will depend on 
its ability to compete effectively against enterprise server competitors with 
more substantial resources and its ability to achieve market acceptance of the 
ES7000 technology by clients, systems integrators, and independent software 
vendors.

A number of the company's long-term contracts for infrastructure services, 
outsourcing, help desk and similar services do not provide for minimum 
transaction volumes. As a result, revenue levels are not guaranteed. In 
addition, some of these contracts may permit termination or may impose other 
penalties if the company does not meet the performance levels specified in the 
contracts.

Some of the company's systems integration contracts are fixed-priced contracts 
under which the company assumes the risk for delivery of the contracted 
services and products at an agreed-upon fixed price. At times the company has 
experienced problems in performing some of these fixed-price contracts on a 
profitable basis and has provided periodically for adjustments to the estimated 
cost to complete them. Future results will depend on the company's ability to 
perform these services contracts profitably.

The company frequently enters into contracts with governmental entities. Risks 
and uncertainties associated with these government contracts include the 
availability of appropriated funds and contractual provisions that allow 
governmental entities to terminate agreements at their discretion before the 
end of their terms.

The success of the company's business is dependent on strong, long-term client 
relationships and on its reputation for responsiveness and quality. As a 
result, if a client is not satisfied with the company's services or products, 
its reputation could be damaged and its business adversely affected. In 
addition, if the company fails to meet its contractual obligations, it could be 
subject to legal liability, which could adversely affect its business, 
operating results and financial condition.




<PAGE> 20


The company has commercial relationships with suppliers, channel partners and 
other parties that have complementary products, services or skills. Future 
results will depend, in part, on the performance and capabilities of these 
third parties, on the ability of external suppliers to deliver components at 
reasonable prices and in a timely manner, and on the financial condition of, 
and the company's relationship with, distributors and other indirect channel 
partners. 

Approximately 54% of the company's total revenue derives from international 
operations. The risks of doing business internationally include foreign 
currency exchange rate fluctuations, changes in political or economic 
conditions, trade protection measures, import or export licensing requirements, 
multiple and possibly overlapping and conflicting tax laws, and weaker 
intellectual property protections in some jurisdictions.

The company cannot be sure that its services and products do not infringe on 
the intellectual property rights of third parties, and it may have infringement 
claims asserted against it or against its clients. These claims could cost the 
company money, prevent it from offering some services or products, or damage 
its reputation.


I
tem 4.   Controls and Procedures
---------------------------------

The company's management, with the participation of the company's Chief 
Executive Officer and Chief Financial Officer, has evaluated the effectiveness 
of the company's disclosure controls and procedures as of June 30, 2004.  Based 
on this evaluation, the company's Chief Executive Officer and Chief Financial 
Officer concluded that the company's disclosure controls and procedures are 
effective for gathering, analyzing and disclosing the information the company 
is required to disclose in the reports it files under the Securities Exchange 
Act of 1934, within the time periods specified in the SEC's rules and forms.  
Such evaluation did not identify any change in the company's internal control 
over financial reporting that occurred during the quarter ended June 30, 2004 
that has materially affected, or is reasonably likely to materially affect, the 
company's internal control over financial reporting. 









                                                      

<PAGE> 21


Part II - OTHER INFORMATION
-------   -----------------


Item 4.   Submission of Matters to a Vote of Security Holders
-------   ---------------------------------------------------

(a) The company's 2004 Annual Meeting of Stockholders (the "Annual Meeting") 
was held on April 22, 2004 in Philadelphia, Pennsylvania.

(c) The following matter was voted upon at the Annual Meeting and received 
the following votes:

       Election of Directors as follows:

       Henry C. Duques - 293,986,489 votes for; 10,001,384 votes withheld

       Clayton M. Jones - 293,943,825 votes for; 10,044,048 votes withheld

       Theodore E. Martin - 290,945,808 votes for; 13,042,065 votes withheld

       Lawrence A. Weinbach - 295,253,437 votes for; 8,734,436 votes withheld


Item 5    Other Information
---------------------------

On July 22, 2004, the company's Board of Directors elected Matthew J. Espe, 
chairman and chief executive officer of IKON Office Solutions, Inc., as a 
director of Unisys.  Mr. Espe has been named to the Finance Committee of the 
Board.


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

(a)       Exhibits

          See Exhibit Index

(b)       Reports on Form 8-K

          As previously disclosed in the company's Quarterly Report on From 
10-Q for the quarterly period ended March 31, 2004, on April 6, 2004, the 
company filed a Current Report on Form 8-K dated April 6, 2004, to report under 

Items 5 and 7 of that form.  

          On April 15, 2004 the company furnished a Current Report on Form 8-K 
to provide, under Items 7 and 12, the company's earnings release reporting its 
financial results for the quarter ended March 31, 2004.  Such information shall 
not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act 
of 1934.










<PAGE> 22


                               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.

                                              UNISYS CORPORATION

Date: July 22, 2004                         By: /s/ Janet M. Brutschea Haugen
                                                -----------------------------
                                                Janet M. Brutschea Haugen
                                                Senior Vice President and 
                                                Chief Financial Officer 
                                                (Principal Financial Officer)


                                             By: /s/ Carol S. Sabochick
                                                 ----------------------
                                                 Carol S. Sabochick
                                                 Vice President and 
                                                 Corporate Controller
                                                 (Chief Accounting Officer)
 











<PAGE> 23

                             EXHIBIT INDEX

Exhibit
Number                        Description
-------                       -----------

3.1      Restated Certificate of Incorporation of Unisys Corporation 
         (incorporated by reference to Exhibit 3.1 to the registrant's 
         Quarterly Report on Form 10-Q for the quarterly period ended 
         September 30, 1999)

3.2      Bylaws of Unisys Corporation, as amended through April 22, 2004 
         (incorporated by reference to Exhibit 3 to the registrant's Quarterly 
         Report on Form 10-Q for the quarterly period ended March 31, 2004)

10.1     Agreement, dated April 6, 2004, between Lawrence A. Weinbach and 
         Unisys Corporation (incorporated by reference to Exhibit 10 to the 
         registrant's current Report on Form 8-K dated April 6, 2004)

10.2     Deferred Compensation Plan for Directors of Unisys Corporation, 
         as amended and restated effective April 22, 2004

12       Statement of Computation of Ratio of Earnings to Fixed Charges

31.1     Certification of Lawrence A. Weinbach required by Rule 13a-14(a) or 
         Rule 15d-14(a)

31.2     Certification of Janet Brutschea Haugen required by Rule 13a-14(a) or 
         Rule 15d-14(a)

32.1     Certification of Lawrence A. Weinbach required by Rule 13a-14(b) or 
         Rule 15d-14(b) and Section 906 of the Sarbanes-Oxley Act of 2002, 18 
         U.S.C. Section 1350

32.2     Certification of Janet Brutschea Haugen required by Rule 13a-14(b) or 
         Rule 15d-14(b) and Section 906 of the Sarbanes-Oxley Act of 2002, 
         18 U.S.C. Section 1350













                            DEFERRED COMPENSATION
                    PLAN FOR DIRECTORS OF UNISYS CORPORATION

                                 ARTICLE I
                             PURPOSE & AUTHORITY


            1.1   PURPOSE.  The purpose of the Plan is to offer members of the 
Board of Directors who are not employees of the Corporation the opportunity to 
defer receipt of a portion of their Compensation, under terms advantageous to 
both the Director and the Corporation.  

            1.2   EFFECTIVE DATE.  The Board originally approved the Plan on 
November 20, 1981, and the Plan was subsequently amended, effective January 1, 
1994.  This document reflects the Plan as amended and restated effective April 
22, 2004.  The terms of this amended and restated Plan shall apply to all 
Account Balances and elections made pursuant to the Plan prior to its 
amendment.

             1.3   AUTHORITY.  Any decision made or action taken by the 
Corporation and any of its officers or employees involved in the 
administration of this Plan, or any member of the Board or the Committee 
arising out of or in connection with the construction, administration, 
interpretation and effect of the Plan shall be within the absolute discretion 
of all and each of them, as the case may be, and will be conclusive and 
binding on all parties.  No member of the Board and no employee of the 
Corporation shall
 be liable for any act or action hereunder, whether of 
omission or commission, by any other member or employee or by any agent to 
whom duties in connection with the administration of the Plan have been 
delegated or, except in circumstances involving the member's or employee's bad 
faith, for anything done or omitted to be done by himself or herself.


                                 ARTICLE II
                                 DEFINITIONS


            2.1   "Account" means, for any Participant, each memorandum 
account established for the Participant under Section 4.1.  "Stock Units 
Account" means that portion of a Participant's Account attributable to 
Elective and Non-Elective Stock Units.  Effective April 22, 2004, each 
Participant's Account maintained under the Unisys Corporation Director Stock 
Unit Plan will be transferred to this Plan and become part of the 
Participant's Stock Unit Account.

            2.2   "Account Balance" means, for any Participant as of any date, 
the aggregate amount reflected in his or her Account.

            2.3   "Beneficiary" means the person or persons designated from 
time to time in writing by a Participant to receive payments under the Plan 
after the death of such Participant or, in the absence of such designation or 
in the event that such designated person or persons predeceases the 
Participant, the Participant's estate.

            2.4   "Board" means the Board of Directors of the Corporation.

            2.5   "Change in Control" shall have the same meaning as is 
ascribed to that term under the Unisys Corporation 2003 Long-Term Incentive 
and Equity Compensation Plan, or any successor stock option plan.

            2.6   "Committee" means the Compensation Committee of the Board, 
or such other committee as may be appointed by the Board to administer the 
Plan.

            2.7   "Compensation" means amounts payable by the Corporation, 
absent deferral, with respect to services provided by a Participant to the 
Corporation as a Director, including retainer and meeting fees, but shall not 
include Non-Elective Stock Unit amounts credited to a Participant's Account 
hereunder.

            2.8   "Corporation" means Unisys Corporation.

            2.9   "Deferral Election" means an election by an Eligible 
Director to defer a portion of his or her Compensation under the Plan, as 
described in Section 3.1.

            2.10  "Eligible Director" means a member of the Board who is not 
an employee of the Corporation.

            2.11  "Executives' Plan" means the Unisys Corporation Deferred 
Compensation Plan.

            2.12  "Fair Market Value" means, on any date, the sales 
price of a share of Unisys Common Stock as of the official close of the New 
York Stock Exchange at 4:00 p.m. U.S. Eastern Standard Time on such date.

            2.13  "Investment Measurement Option" means any of the 
hypothetical investment alternatives available for determining the additional 
amounts to be credited to a Participant's Account under Section 4.2.  The 
Investment Measurement Options available are all of the investment options 
available to eligible participants under the USP other than the Unisys Common 
Stock Fund.  

            2.14  "Option for Stock Units" means an option, created pursuant 
to a Director's election in accordance with Section 6 that, if exercised by 
the Director, will result in the crediting of Stock Units to the Director's 
Account.

            2.15  "Participant" means an Eligible Director or former Eligible 
Director who has made a Deferral Election and who has not received a 
distribution of his or her entire Account Balance.

            2.16  "Plan" means the Deferred Compensation Plan for Directors of 
Unisys Corporation, as set forth herein and as amended from time to time.

            2.17  "Revised Election" means an election made by a Participant, 
in accordance with Section 5.2, to change the date as of which payment of his 
or her Account Balance is to commence and/or the form in which such payment is 
to be made.

            2.18  "Stock Units" means Unisys common stock-equivalent units, 
which are awarded pursuant to the Unisys Corporation 2003 Long-Term Incentive 
and Equity Compensation Plan as Elective or Non-Elective Stock Units.  
Elective Stock Units are Stock Units awarded as a result of a Participant's 
election to defer the receipt of Compensation in accordance with Section 
4.2(b) of the Plan or the Participant's election to convert an option for 
stock to an Option for Stock Units in accordance with Section 3.2 of the Plan.  
Non-Elective Stock Units are Stock Units awarded to the Participant by the 
Corporation without regard to a deferral election.

            2.19  "USP" means the Unisys Savings Plan.

            2.20  "Valuation Date" means any business day as of which the 
interest of a Participant in each of the Participant's Accounts is valued 
pursuant to the terms of the Plan.


                                 ARTICLE III
                            DEFERRAL OF COMPENSATION


            3.1   DEFERRAL ELECTION.
            (a)   Prior to or during any calendar year, each Eligible Director 
may elect to defer all or a portion of his or her Compensation that, absent 
deferral, would be paid to him or her for services rendered during the 
following calendar year or the remainder of the current calendar year, as 
applicable, by properly completing a Deferral Election form.

            (b)   To be effective, a Deferral Election must be made in writing 
by the Eligible Director on a form furnished by the Secretary of the 
Corporation on or before the date that is (I) no later than the December 31 
prior to the calendar year to which the Deferral Election applies or (II) at 
least three months and one day before the date on which the amounts to be 
deferred, absent deferral, would be paid to the Eligible Director, provided, 
however, that an individual who becomes an Eligible Director after January 1 
of a calendar year may make a Deferral Election with respect to Compensation 
that, absent deferral, would be paid to him or her during the remainder of the 
calendar year in which he or she has become an Eligible Director, by filing 
the required written election on or before the date that is 30 days after the 
date on which he or she becomes an Eligible Director.  

            (c)   Once made, a Deferral Election shall become effective upon 
receipt by the Secretary of the Corporation and is thereafter irrevocable, 
except to the extent otherwise provided in Section 5.2.  

            (d)   An Eligible Director's Deferral Election must specify either 
a percentage or a certain dollar amount of his or her Compensation to be 
deferred under the Plan.  In addition, the Deferral Election must specify the 
date on which payment of the amount deferred and payment in respect of any 
Non-Elective Stock Units that may be credited to the Participant's Account is 
to commence and the manner in which such payment is to be made, as set forth 
below:

                  (1)   Subject to Section 5.1(b) hereof, the Deferral 
Election must specify that such payment is to commence as of:

                        (A)   his or her termination of service as a member of 
the Board (including as a result of disability); or

                        (B)   a specific date (which may be determined by 
reference to the Eligible Director's termination of service) that is at least 
two years after the date on which the initial amounts to be deferred, absent 
deferral, would be paid to the Eligible Director.

                  (2)   The Eligible Director must specify whether payment of 
his or her Account Balance, including any payment in respect of any Non-
Elective Stock Units that may be credited to the Participant's Account, is to 
be made in a single sum or in annual installments.

                  (3)   Notwithstanding the foregoing, an Eligible Director 
may not elect a time of benefit commencement and/or a form of payment to the 
extent that such an election would cause any payments to be made after the 
March 31 first following the date that is 20 years after the date of the 
Eligible Director's termination of service.

            (e)   Deferrals of an Eligible Director's Compensation shall be 
credited to the Plan at the time at which the Compensation, absent deferral, 
would be payable to the Participant.

            (f)   Unless the Deferral Election form specifically provides 
otherwise, a Deferral Election shall expire as of the last day of the calendar 
year that includes the first day on which any amount, absent deferral, would 
be paid to the Eligible Director.

            3.2   OPTIONS FOR STOCK UNITS.  A Director who holds an option for 
Corporation common stock that was awarded to him or her under any plan 
maintained by the Corporation may elect, to the extent permitted under that 
plan or otherwise by the Committee, to convert all or part of that option to 
an Option for Stock Units in accordance with the provisions of this Section 
3.2.

            (a)   ELECTION TO CONVERT OPTION.  A Director can elect to convert 
all or a portion of an outstanding option to an Option for Stock Units by 
providing written notice to the Corporation, which must be received by the 
Corporate Executive Compensation Department, at least six months before the 
expiration date of the option.  The election must specify the number of shares 
of Corporation common stock subject to the option that are to become subject 
to the Option for Stock Units.  The election must also specify the date on 
which the Stock Units to be credited to the Director's Account upon the 
exercise of the Option for Stock Units are to be paid to the Director; such 
date may be (1) the Director's termination of service or (2) a specific date 
(which may be determined by reference to the Director's termination of service 
or by reference to the date of the Director's exercise of the Option for Stock 
Units).  

            (b)   EXERCISE OF OPTIONS FOR STOCK UNITS.  A Director may not 
exercise an Option for Stock Units until the expiration of the six-month 
period beginning on the date on which the Director's option is converted to an 
Option for Stock Units.  Thereafter, but only until the expiration of the 
period during which the option that the Director converted to an Option for 
Stock Units could, in accordance with its original terms be exercised, a 
Director may exercise Options for Stock Units by providing written notice of 
exercise to the place designated by the Committee.  At the time of the 
exercise of an Option for Stock Units, the Director must certify to the 
Corporation or its designee that he or she currently owns shares of 
Corporation common stock sufficient to pay the aggregate option price and, if 
the shares were acquired for services to the Corporation that he or she has 
held those shares for at least six months.

            (c)   EFFECT OF EXERCISE.   

                  (1)   As soon as practicable following receipt of a 
Director's notice of exercise under Section 3.2(b), Stock Units will be 
credited to the Director's Account.  The number of Stock Units to be so 
credited will be equal to (A) the difference between (i) the aggregate fair 
market value on the date of exercise of the shares of Corporation common 
stock relating to the portion of the Option for Stock Units that the Director 
has elected to exercise and (ii) the sum of (a) the aggregate exercise price 
and (b) any Social Security, Medicare or state or local income tax required 
to be withheld with respect to the exercise, divided by (B) the fair market 
value of a share of Corporation common stock on the date of exercise.   For 
purposes of this Section 3.2(c)(1), "fair market value" means, on any date, 
the average of the high and the low sales price of a share of Unisys common 
stock as reported on the New York Stock Exchange for that day, but not later 
than the earlier of the official close of the New York Stock Exchange or 4:00 
p.m. US Eastern Standard Time or Eastern Daylight Time, as the case may be

                  (2)   Notwithstanding a Director's election of a payment 
date under Section 3.2(a), if the Director exercises an Option for Stock 
Units later than two years before the payment date elected, payment in 
respect of the Stock Units credited to his or her Account as a result of the 
exercise will be made as soon as practicable after the second anniversary of 
the date of exercise. 

            (d)   EFFECT OF TERMINATION OF SERVICE.  If a Director 
terminates service before exercising an Option for Stock Units, the Option for 
Stock Units will remain exercisable to the extent that the option that the 
Director converted to the Option for Stock Units would have remained 
exercisable absent conversion.  If, however, the Director (or his or her 
Beneficiary) subsequently exercises the Option for Stock Units after his or 
her Account Balance has been paid or has begun to be paid as a result of his 
or her termination of service, payment in respect of the Stock Units acquired 
upon such exercise will be made immediately.  If the Director (or his or her 
Beneficiary) fails to exercise the Option for Stock Units before the date on 
which the option that the Director converted to an Option for Stock Units 
would have expired or terminated, then the Director's (or Beneficiary's) right 
to exercise the Option for Stock Units will likewise terminate.


                                     ARTICLE IV
                           TREATMENT OF DEFERRED AMOUNTS


            4.1   MEMORANDUM ACCOUNT.  (a)  The Corporation shall establish on 
its books a separate Account for each Participant for each calendar year in 
which the Participant elects to defer Compensation.  Amounts deferred by a 
participant pursuant to a Deferral Election shall be credited to the 
Participant's Account on the date on which the deferred amounts, absent 
deferral, would have been paid to the Participant.  Non-Elective Stock Units 
awarded to the Participant shall be credited to the Participant's Account on 
such dates as are prescribed in the applicable award documents.  In addition, 
as of each Valuation Date, incremental amounts determined in accordance with 
Section 4.2 will be credited or debited to each Participant's Account.  Any 
payments made to or on behalf of the Participant and for his or her 
Beneficiary shall be debited from the Account.  No assets shall be segregated 
or earmarked in respect to any Account and no Participant or Beneficiary shall 
have any right to assign, transfer, pledge or hypothecate his or her interest 
or any portion thereof in his or her Account.  The Plan and the crediting of 
Accounts hereunder shall not constitute a trust or a funded arrangement of any 
sort and shall be merely for the purpose of recording an unsecured contractual 
obligation of the Corporation.
		
            (b)   If the Corporation shall issue a stock dividend on the common 
stock, stock dividend equivalents shall be credited to the Participant's Stock 
Unit Account, as of the dividend payment date, as Stock Units in the same 
amount as the stock dividends to which the Participant would have been 
entitled if the Stock Units were shares of common stock.  Cash dividends, if 
any, shall be credited to the Stock Units Account, as of the dividend payment 
date, in the form of Stock Units based on the Fair Market Value of the Common 
Stock on the dividend payment date.  The Stock Units Account shall be 
appropriately adjusted to reflect splits, reverse splits, or comparable 
changes to the Corporation's common stock.

            4.2   INVESTMENT MEASUREMENT OPTIONS.  

            (a)   Subject to the provisions of this Section 4.2, a 
Participant's Account, excluding his/her Stock Units Account, shall be 
credited or debited with amounts equal to the amounts that would be earned or 
lost with respect to the Participant's Account Balance if amounts equal to 
that Account Balance were actually invested in the Investment Measurement 
Options in the manner specified by the Participant.

            (b)   Each Eligible Director may elect, at the same time as a 
Deferral Election is made, to have one or more of the Investment Measurement 
Options applied to current deferrals, or to have the current deferrals 
credited to his/her Stock Units Account in the form of Elective Stock Units.  
Such election with respect to current deferrals may be changed at any time 
upon appropriate notice to the Corporate Executive Compensation Department; 
provided, however, that an election to have current deferrals credited as 
Elective Stock Units may not be changed at any time during the effective 
period of the Deferral Election.  If a Participant elects to have current 
deferrals credited as Elective Stock Units, the number of Stock Units to be 
credited to the Participant's Stock Unit Account under this Section 4.2(c) 
shall be the quotient of (i) divided by (ii) where (i) equals the amount of 
the current deferral to be credited as Stock Units and (ii) equals the Fair 
Market Value on the date on which the amounts are credited to the 
Participant's Stock Unit Account.

            (c)   Subject to the restrictions described in Subsection (d), a 
Participant may elect to change the manner in which Investment Measurement 
Options apply to existing Account Balances (excluding the Participant's Stock 
Units Account).  In addition, a Participant may elect to have all or any 
portion of his/her existing Account Balances (other than the Stock Units 
Account) credited to his/her Stock Units Account as Elective Stock Units.  
                   (i)   The number of Stock Units to be credited to the 
Participant's Stock Unit Account under this Section 4.2(b) shall 
be the quotient of (x) divided by (y) where (x) equals the amount 
of the current deferral to be credited as Stock Units and (y) 
equals the Fair Market Value on the effective date on which the 
amounts are credited to the Participant's Stock Unit Account.

Any election described in this subsection (c) will be effective upon receipt 
of the appropriate notice to the Corporate Executive Compensation Department.

            (d)   The following rules apply to Investment Measurement Options.

                  (1)   The percentage of a Participant's current deferrals 
and/or Account Balance to which a specified Investment Measurement Option is 
to be applied must be a multiple of one percent (1%).  The Participant may 
change the specified Investment Measurement Options that will apply to his or 
her Account(s) on any business day as of which the Plan's recordkeeper is open 
for business.  Changes in a specified Investment Measurement Option with 
respect to a Participant's Account will be effective as soon as 
administratively practicable following receipt of the Participant's election.

                  (2)   To the extent that a Participant has not specified an 
Investment Measurement Option to apply to all or a portion of his or her 
current deferrals and/or Account Balance, the Insurance Contract Fund or such 
other fund as is designated by the Committee shall be deemed to be the 
applicable Investment Measurement Option.

                  (3)   The chosen Investment Measurement Option or Options 
shall apply to deferred amounts on the date on which such deferred amounts, 
absent deferral, would have been paid to the Participant.

            (e)   The Committee shall have the authority to modify the rules 
and restrictions relating to Investment Measurement Options (including the 
authority to change such Investment Measurement Options prospectively) as it, 
in its discretion, deems necessary and in accord with the investment practices 
in place under the USP.


                                     ARTICLE V
                            PAYMENT OF DEFERRED AMOUNTS


            5.1   FORM AND TIME OF PAYMENT.  The benefits to which a 
Participant or a Beneficiary may be entitled under the Plan shall be paid in 
accordance with this Section 5.1.

            (a)   Payments of a Participant's Account Balances (other than the 
Participant's Stock Units Account) shall be made in cash.  Payments of the 
Participant's Stock Units Account shall be made in shares of Unisys common 
stock and the number of shares of Unisys common stock delivered to the 
Participant shall equal the number of Stock Units held in the Participant's 
Stock Units Account. 

            (b)   Except as otherwise provided in Sections 5.3 and 5.4, 
payment of a Participant's Account Balance shall commence as of the Valuation 
Date next following the date or dates specified in the Participant's Deferral 
Election or Elections or (where applicable) the Participant's Revised Election 
or Elections; provided, however, that where the Participant's Deferral 
Election or Elections or (where applicable) the Participant's Revised Election 
or Elections specify that payments with respect to a Participant's Account 
Balance are to commence as of a specified date or specified dates not 
determined by reference to the Participant's retirement or other termination 
of service and the Participant terminates service with the Corporation prior 
to such date or dates, payment of the portion of the Participant's Account 
Balance that was deferred to such date or dates shall commence as of the 
Valuation Date next following the Participant's termination of service, but in 
the same manner  specified in the Participant's Deferral Election or Elections 
or (where applicable) the Participant's Revised Election or Elections.

            (c)   All payments shall be made in the manner specified in the 
Participant's Deferral Election or Elections or (where applicable) the 
Participant's Revised Election or Elections.

            (d)   To the extent a Participant has not specified the manner or 
time of payment of all or a part of his or her Account Balance, payment of the 
amounts not specified will be made in a single sum as soon as administratively 
practicable, but no later than 90 days, after the first Valuation Date 
following the Participant's termination of service as a Director. 

            (e)   Where a Participant has elected payment in the form of 
annual installments, each installment payment after the initial installment 
payment shall be made on or about March 31 of each year following the year in 
which the first installment was paid.  With respect to each Deferral Election 
made by a Participant, the amount of each annual installment payment to be 
made to a Participant under such Deferral Election shall be determined by 
dividing the portion of the Participant's Account Balance covered by such 
Deferral Election as of the latest Valuation Date preceding the date of 
payment by the number of installments remaining to be paid under such Deferral 
Election.

            (f)   Notwithstanding any Deferral Election made by the 
Participant:

                  (1)   If a Participant terminates service as a Director 
after beginning to receive any portion of an Account Balance that was to be 
paid to the Participant as of a specific date, the remaining Account Balance 
shall be distributed in accordance with the distribution election in effect at 
the time of the Participant's termination of service as a Director.

                  (2)   If the balance in all of a Participant's Accounts is 
less than a minimum amount established by the Committee at the time of a 
Participant's termination of service as a Director, the balance in all the 
Participant's Accounts shall be paid to the Participant in a single sum.

                  (3)   Any portion of a Participant's Account Balance that 
has not been paid to the Participant as of the date of his or her death shall 
be paid to the Participant's Beneficiary in a single sum as soon as 
administratively practicable after the Valuation Date following the date on 
which the Corporation receives notification of the Participant's death.

            5.2   REVISED ELECTION.

            (a)   Pursuant to a Revised Election, a Participant may specify:

                  (1)   a date for the commencement of the payment of the 
Participant's Account Balance that is either the date of the Participant's 
termination of service as a Director or a date at least one year after the 
date specified in the Participant's applicable Deferral Election; and/or 

                  (2)   a manner of payment that calls for a greater number of 
annual installment payments than that specified in the Participant's 
applicable Deferral Election, or a number of annual installment payments where 
the Participant specified a single sum payment in his or her applicable 
Deferral Election.

                  (3)   Notwithstanding the foregoing, a Participant may not 
elect a time of benefit commencement and/or a form of payment to the extent 
that such an election would cause any payments to be made after the March 31 
first following the date that is 20 years after the date of the Eligible 
Executive's termination of service as a Director.

            (b)   A Participant may only make three Revised Elections with 
respect to each of the Participant's Accounts.
 
            (c)   To be effective, a Revised Election must be:

                  (1)   made in writing by the Participant on a form furnished 
for such purpose by the Corporate Executive Compensation Department;

                  (2)   submitted to the Corporate Executive Compensation 
Department on or before the date that is three months and one day before the 
date on which the portion of the Participant's Account Balance that is the 
subject of the Revised Election would, absent the Revised Election, first 
become payable; and 

                  (3)   approved by the Corporate Executive Compensation 
Department.  A Revised Election will be deemed to have been approved by the 
Corporate Executive Compensation Department if it is not disapproved by the 
Corporate Executive Compensation Department within ten days of the date on 
which it is received.

            5.3   SPECIAL PAYMENT.

            (a)   Notwithstanding any other provision of the Plan to the 
Contrary, a Participant may receive payment of all or a portion of his or her 
Account Balance as soon as administratively practicable following the receipt 
by the Secretary of the Corporation of the Participant's written request for 
such payment; provided, however, that a Participant will not be permitted to 
receive any portion of his/her Non-Elective Stock Units under this Section 
5.3(a) prior to termination of service as a Director.

            (b)   As a condition of receiving any payment made pursuant to 
Subsection 5.3(a), a Participant will be subject to, as a penalty, payment to 
the Company of an amount equal to eight percent of the amount of the payment 
made pursuant to Subsection 5.3(a).  The payment to the Company shall 
generally be deducted from the amount otherwise payable to the Participant 
under Subsection 5.3(a).

            (c)   If a Participant receives a payment of less than his or her 
entire Account Balance pursuant to Subsection 5.3(a), the portion of the 
Participant's Account Balance to which each Investment Measurement Option is 
applied shall be reduced proportionately so that the Investment Measurement 
Options apply to the Participant's Account Balance in the same percentage 
immediately before and immediately after the payment.

            (d)   Notwithstanding any provision of the Plan to the contrary, 
in the event the Committee determines that any portion of a Participant's 
Account Balance is the subject of a determination by the Internal Revenue 
Service that such portion is includible in the Participant's taxable income, 
the Participant's Account Balance shall be distributed to the extent it is so 
includible.  Payments made in respect of the Participant's Stock Units Account 
will be made in shares of Unisys common stock.   All income taxes and related 
interest and penalties associated with credits to or distributions from a 
Participant's Account shall be borne by the Participant.

            5.4   ACCELERATION OF PAYMENT.  Notwithstanding any other 
provision of this Plan to the contrary, the Committee in its sole discretion 
may accelerate the payment of Account Balances to all or any group of 
similarly situated Participants or Beneficiaries, whether before or after the 
Participant's termination of service, in response to changes in the tax laws 
or accounting principles.

            5.5   SEC RULE 16b.  If deemed necessary to comply with Rule 16b-3 
under the Securities and Exchange Act of 1934, as amended, the Corporation may 
delay payment of Stock Units until six months following the date on which the 
Stock Units were credited to the Participant's Account.


                                   ARTICLE VI
                                  MISCELLANEOUS


            6.1   AMENDMENT.  The Board may modify or amend, in whole or in 
part, any of or all the provisions of the Plan, or suspend or terminate it 
entirely; provided, however, that any such modification, amendment, suspension 
or termination may not, without the Participant's consent, adversely affect 
any deferred amount credited to him or her for any period prior to the 
effective date of such modification, amendment, suspension or termination.  
The Plan shall remain in effect until terminated pursuant to this provision.

            6.2   ADMINISTRATION.  The Committee shall have the sole authority 
to interpret the Plan and in its discretion to establish and modify 
administrative rules for the Plan.  All expenses and costs in connection with 
the operation of this Plan shall be borne by the Corporation.  The Corporation 
shall have the right to deduct from any payment to be made pursuant to this 
Plan any federal, state or local taxes required by law to be withheld, and any 
associated interest and/or penalties.

            6.3   GOVERNING LAW.  The Plan shall be construed and its 
provisions enforced and administered in accordance with the laws of the 
Commonwealth of Pennsylvania except as such laws may be superseded by the 
federal law.


                                  ARTICLE VII
                          TRANSFER OF ACCOUNT BALANCE


            7.1   TRANSFER OF EXECUTIVES' PLAN ACCOUNTS.  Notwithstanding any 
other provision of the Plan to the contrary, a Director who is a former 
employee of Unisys Corporation and who is a participant in the Executives' 
Plan may elect to transfer any or all of his/her account balance in the 
Executives' Plan into this Plan.  Upon transfer, such amounts shall be subject 
to the terms and conditions of this Plan, provided that all elections 
previously made under the Executives' Plan with respect to such amounts shall 
continue in effect until otherwise modified hereunder.  Notwithstanding the 
payment election provision described in Article V hereof, in no event may a 
Director elect a form of payment with respect to amounts transferred from the 
Executives' Plan that is any more rapid than the form of payment in effect 
under the Executives' Plan at the time of such transfer.


                                  ARTICLE VIII
                                CHANGE IN CONTROL


            8.1   WITHDRAWAL ELECTION.

            (a)   Notwithstanding any other provision of the Plan to the 
contrary, in the event of a Change in Control, each Participant may elect to 
receive a single sum payment of all or any portion of his/her account balance. 
Such election shall only be effective if delivered to the Secretary of the 
Corporation within the ninety-day period immediately following the date of the 
occurrence of the Change in Control.

            (b)   If an election is timely made, the Participant (or 
Beneficiary) will be entitled to receive, as soon as practicable after the 
expiration of the ninety-day period, an amount equal to (1) the full value or 
any portion thereof of the Account Balance minus (2) an early withdrawal 
penalty equal to 8% of the total value of (1).  The Committee, upon advice of 
counsel, may modify the early withdrawal penalty described above in any way it 
deems appropriate and consistent with the purposes of the Plan.

            8.2   LITIGATION EXPENSES.  If litigation is brought by a 
Participant or Beneficiary after a Change in Control to enforce or interpret 
any provision of the Plan, the Corporation to the extent permitted by 
applicable law shall reimburse the Participant (or Beneficiary) for the 
reasonable fees and disbursements of counsel incurred in such litigation.




                                                        Exhibit 12

                             UNISYS CORPORATION
       COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (UNAUDITED)
                               ($ in millions)

                                

                                  Six             
                                  Months     
                                  Ended          Years Ended December 31
                                  June 30, ----------------------------------
                                  2004      2003   2002   2001   2000   1999   
                                  --------  ----   ----   ----   ----   ----   
Fixed charges
Interest expense                  $  35.2  $ 69.6 $ 66.5 $ 70.0 $ 79.8 $127.8  
Interest capitalized during 
  the period                          8.5    14.5   13.9   11.8   11.4    3.6 
Amortization of debt issuance
  expenses                            1.7     3.8    2.6    2.7    3.2    4.1 
Portion of rental expense
  representative of interest         27.6    55.2   53.0   53.9   42.2   46.3  
                                   ------  ------ ------ ------ ------  -----  
    Total Fixed Charges              73.0   143.1  136.0  138.4  136.6  181.8  
                                   ------  ------ ------ ------ ------  -----
Earnings                             
Income (loss) from continuing
 operations before income taxes      71.1   380.5  332.8  (73.0) 348.5  751.7  
Add (deduct) the following:
 Share of loss (income) of
  associated companies              (13.2)  (16.2)  14.2   (8.6) (20.5)   8.9  
 Amortization of capitalized
  interest                            5.6    10.2    8.8    5.4    2.2     -   
                                   ------  ------ ------ ------ ------  -----
    Subtotal                         63.5   374.5  355.8  (76.2) 330.2  760.6  
                                   ------  ------ ------ ------ ------  -----

Fixed charges per above              73.0   143.1  136.0  138.4  136.6  181.8  
Less interest capitalized during
  the period                        ( 8.5)  (14.5) (13.9) (11.8) (11.4)  (3.6) 
                                   ------  ------ ------ ------ ------ ------
Total earnings                     $128.0  $503.1 $477.9 $ 50.4 $455.4 $938.8  
                                   ======  ====== ====== ====== ====== ======

Ratio of earnings to fixed 
  charges                            1.75    3.52   3.51     *    3.33   5.16  
                                   ======  ====== ====== ====== ======  =====

* Earnings for the year ended December 31, 2001 were inadequate to cover fixed 
charges by approximately $88 million.
 




                                                               Exhibit 31.1
                             CERTIFICATION

I, Lawrence A. Weinbach, certify that:

1.  I have reviewed this quarterly report on Form 10-Q of Unisys 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 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. 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; 

c. 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 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 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 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: July 22, 2004                      /s/ Lawrence A. Weinbach 
                                         -------------------------
                                     Name:   Lawrence A. Weinbach
                                     Title:  Chairman of the Board and 
                                             Chief Executive Officer



                                                               Exhibit 31.2
                             CERTIFICATION

I, Janet Brutschea Haugen, certify that:

1.  I have reviewed this quarterly report on Form 10-Q of Unisys 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 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. 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; 

c. 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 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 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 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: July 22, 2004                      /s/ Janet Brutschea Haugen 
                                         -------------------------
                                     Name:   Janet Brutschea Haugen
                                     Title:  Senior Vice President and
                                             Chief Financial Officer



                                                                 Exhibit 32.1



                  CERTIFICATION OF PERIODIC REPORT

I, Lawrence A. Weinbach, Chairman of the Board and Chief Executive 
Officer of Unisys Corporation (the "Company"), certify, pursuant to 
Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, 
that:

(1)   the Quarterly Report on Form 10-Q of the Company for the quarterly 
period ended June 30, 2004 (the "Report") fully complies with the 
requirements of Section 13(a) of the Securities Exchange Act of 1934 
(15 U.S.C. 78m); 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: July 22, 2004

                     
               
/s/ Lawrence A. Weinbach
------------------------
Lawrence A. Weinbach
Chairman of the Board and 
Chief Executive Officer




A signed original of this written statement required by Section 906 has been 
provided to the Company and will be retained by the Company and furnished to 
the Securities and Exchange Commission or its staff upon request.









                                                                   Exhibit 32.2



                     CERTIFICATION OF PERIODIC REPORT

I, Janet Brutschea Haugen, Senior Vice President and Chief Financial 
Officer of Unisys Corporation (the "Company"), certify, pursuant to 
Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, 
that:

(1)   the Quarterly Report on Form 10-Q of the Company for the quarterly 
period ended June 30, 2004 (the "Report") fully complies with the 
requirements of Section 13(a) of the Securities Exchange Act of 1934 
(15 U.S.C. 78m); 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: July 22, 2004

                     
               
/s/ Janet Brutschea Haugen
--------------------------
Janet Brutschea Haugen
Senior Vice President and 
Chief Financial Officer



A signed original of this written statement required by Section 906 has been 
provided to the Company and will be retained by the Company and furnished to 
the Securities and Exchange Commission or its staff upon request.