<PAGE>   1
    AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 4, 1996
                                                      REGISTRATION NO. 33-
--------------------------------------------------------------------------------

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

                                    FORM S-8
                             REGISTRATION STATEMENT
                                     UNDER
                           THE SECURITIES ACT OF 1933

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

                              SIERRA ON-LINE, INC.
             (Exact name of Registrant as specified in its charter)

<TABLE>
<S>                                                                  <C>
                           DELAWARE                                               77-0164293
(State or other jurisdiction of incorporation or organization)       (I.R.S. Employer Identification No.)
</TABLE>

                       3380 - 146TH PLACE S.E., SUITE 300
                           BELLEVUE, WASHINGTON 98007
          (Address of principal executive offices, including zip code)

                  SIERRA ON-LINE, INC. 1987 STOCK OPTION PLAN
                PAPYRUS DESIGN GROUP INC. 1992 STOCK OPTION PLAN
             SIERRA ON-LINE, INC. 1993 STOCK OPTION GRANT AGREEMENT
             SIERRA ON-LINE, INC. 1994 STOCK OPTION GRANT AGREEMENT
                           (Full titles of the plans)

                               RICHARD K. THUMANN
                                GENERAL COUNSEL
                       3380 - 146TH PLACE S.E., SUITE 300
                           BELLEVUE, WASHINGTON 98007
                                 (206) 649-9800
(Name, address and telephone number, including area code, of agent for service)

                             ----------------------
                                    COPY TO:

                               STEPHEN A. MCKEON
                                DAVID C. CLARKE
                                  PERKINS COIE
                         1201 THIRD AVENUE, 40TH FLOOR
                         SEATTLE, WASHINGTON 98101-3099

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

                        CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
==================================================================================================================================
    TITLE OF SECURITIES                  AMOUNT TO BE        PROPOSED MAXIMUM             PROPOSED MAXIMUM           AMOUNT OF
     TO BE REGISTERED                    REGISTERED(1)  OFFERING PRICE PER SHARE(2)  AGGREGATE OFFERING PRICE(2)  REGISTRATION FEE
----------------------------------------------------------------------------------------------------------------------------------
<S>                                      <C>            <C>                          <C>                          <C>
Common Stock, $.01 par value per share:
   Sierra On-Line, Inc.
     1987 Stock Option Plan                  800,000               $36.4375                 $40,102,894               $13,829
   Papyrus Design Group
     Inc. 1992 Stock                         230,594
     Option Plan
     Sierra On-Line, Inc.
     1993 Stock Option                        40,000
     Grant Agreement
     Sierra On-Line, Inc.
     1994 Stock Option                        30,000
     Grant Agreement
                                           ---------
  TOTAL                                    1,100,594
==================================================================================================================================
</TABLE>

(1)      Together with an indeterminate number of additional shares that may be
         necessary to adjust the number of shares reserved for issuance under
         the Sierra On-Line, Inc. 1987 Stock Option Plan, the Papyrus Design
         Group Inc. 1992 Stock Option Plan, the Sierra On-Line, Inc. 1993 Stock
         Option Grant Agreement and the Sierra On-Line, Inc. 1994 Stock Option
         Grant Agreement as the result of any future stock split, stock dividend
         or similar adjustment of the outstanding Common Stock of the
         Registrant.

(2)      Estimated pursuant to Rule 457(h) under the Securities Act of 1933, as
         amended, solely for the purpose of calculating the registration fee.
<PAGE>   2
                                    PART II

               INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

ITEM 3.  INCORPORATION OF DOCUMENTS BY REFERENCE

         The following documents are hereby incorporated by reference in this
Registration Statement:

                  (a) The Registrant's Annual Report on Form 10-K for the fiscal
year ended March 31, 1995 filed with the Securities and Exchange Commission (the
"Commission") (as amended by the Registrant's Quarterly Report on Form 10-Q for
the quarter ended December 31, 1995);

                  (b) All other reports filed by the Registrant pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), since the end of the fiscal year covered by the Form 10-K
referred to in (a) above; and

                  (c) The description of the Registrant's Common Stock contained
in the Registration Statement on Form 8-A filed with the Commission under
Section 12(g) of the Exchange Act, including any amendment or reports filed for
the purpose of updating such description.

         All documents filed by the Registrant pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act after the date hereof and prior to the
filing of a post-effective amendment, which indicates that the securities
offered hereby have been sold or which deregisters the securities covered hereby
then remaining unsold, shall also be deemed to be incorporated by reference into
this Registration Statement and to be a part hereof commencing on the respective
dates on which such documents are filed.

ITEM 6.  INDEMNIFICATION OF DIRECTORS AND OFFICERS

         Section 145 of the Delaware General Corporation Law provides that a
corporation may indemnify its directors and officers as well as other employees
and individuals against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement in connection with specified actions, suits or
proceedings, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the corporation--a "derivative action"), if
they acted in good faith and in a manner they reasonably believed to be in or
not opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe their conduct
was unlawful. A similar standard is applicable in the case of derivative
actions, except that indemnification only extends to expenses (including
attorneys' fees) incurred in connection with the defense or settlement of such
actions, and the statute requires court approval before there can be any
indemnification where the person seeking indemnification has been found liable
to the corporation. The statute provides that it is not exclusive of other
indemnification that may be granted by a corporation's charter, by-laws,
disinterested director vote, stockholder vote, agreement or otherwise.

         Article VI of the Registrant's By-Laws requires indemnification to the
full extent permitted under Delaware law as from time to time in effect. Subject
to any restrictions imposed by Delaware law, the By-Laws provide an
unconditional right to indemnification for all expenses, liability and loss
(including attorneys' fees, judgments, fines, ERISA excise taxes or penalties
and amounts paid in settlement) actually and reasonably incurred or suffered by
any person in connection with any actual or threatened action, suit or
proceeding, whether civil, criminal, administrative or investigative (including,
to the extent permitted by law, any derivative action) by reason of the fact
that such person is or was serving as a director or officer of the Registrant or
that, being or having been a director or officer or an employee of the
Registrant, such person is or was serving at the request of the Registrant as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, including an employee benefit plan. The
By-Laws also provide that the Registrant may, by action of its Board of
Directors, provide indemnification to its employees and agents with the same
scope and effect as the foregoing indemnification of directors and officers.


                                      II-1
<PAGE>   3
         Section 102(b)(7) of the Delaware General Corporation Law permits a
corporation to provide in its certificate of incorporation that a director of
the corporation shall not be personally liable to the corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability for (i) any breach of the director's duty of loyalty to the
corporation or its stockholders, (ii) acts or omissions not in good faith or
that involve intentional misconduct or a knowing violation of law, (iii)
payments of unlawful dividends or unlawful stock repurchases or redemptions, or
(iv) any transaction from which the director derived an improper personal
benefit.

         Article VII of the Registrant's Certificate of Incorporation provides
that, subject to certain limitations, a director of the Registrant shall not be
liable to the Registrant or its stockholders for monetary damages for breach of
fiduciary duty as a director. Any amendment to or repeal of such Article VII
shall not adversely affect any right or protection of a director of the
Registrant for or with respect to any acts or omissions of such director
occurring prior to such amendment or repeal.

ITEM 8.  EXHIBITS

<TABLE>
<CAPTION>
EXHIBIT
 NUMBER                                                  DESCRIPTION
----------------------------------------------------------------------------------------------
<S>            <C>
  5.1          Opinion of Perkins Coie regarding legality of the Common Stock being registered

 23.1          Consent of Deloitte & Touche LLP

 23.2          Consent of Perkins Coie (included in the opinion filed as Exhibit 5.1)

 24.1          Power of Attorney (see signature page)

 99.1          Sierra On-Line, Inc. 1987 Stock Option Plan (1)

 99.2          Papyrus Design Group Inc. 1992 Stock Option Plan

 99.3          Sierra On-Line, Inc. 1993 Stock Option Grant Agreement

 99.4          Sierra On-Line, Inc. 1994 Stock Option Grant Agreement
</TABLE>

----------

(1)  Incorporated by reference to exhibit filed with the Registrant's Annual
     Report on Form 10-K (File No. 0-17154) filed for the year ended March 31,
     1994.

ITEM 9.  UNDERTAKINGS

A.       The undersigned Registrant hereby undertakes:

         (1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:

                   (i) To include any  prospectus  required by Section 10(a)(3)
of the Securities Act of 1933, as amended (the "Securities Act");

                  (ii) To reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this Registration
Statement; and

                 (iii) To include any material information with respect to the
plan of distribution not previously disclosed in this Registration Statement or
any material change to such information in this Registration Statement;


                                      II-2
<PAGE>   4
provided, however, that paragraphs (1)(i) and (1)(ii) above do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in this Registration Statement.

         (2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.

         (3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.

B. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefits plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in this Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.

C. Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.


                                      II-3
<PAGE>   5
                                   SIGNATURES

         Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Bellevue, State of Washington, on February 29,
1996.

                                       SIERRA ON-LINE, INC.

                                       By: /s/ Michael A. Brochu
                                           -------------------------------------
                                           Michael A. Brochu
                                           President and Chief Operating Officer

                               POWER OF ATTORNEY

         EACH PERSON WHOSE INDIVIDUAL SIGNATURE APPEARS BELOW HEREBY AUTHORIZES
KENNETH A. WILLIAMS AND MICHAEL A. BROCHU AND EACH OF THEM AS ATTORNEYS-IN-FACT,
WITH FULL POWER OF SUBSTITUTION, TO EXECUTE IN THE NAME AND ON BEHALF OF SUCH
PERSON, INDIVIDUALLY AND IN EACH CAPACITY STATED BELOW, AND TO FILE, ANY AND ALL
AMENDMENTS TO THIS REGISTRATION STATEMENT, INCLUDING ANY AND ALL POST-EFFECTIVE
AMENDMENTS WITH THE SECURITIES AND EXCHANGE COMMISSION OR ANY REGULATORY
AUTHORITY.

         Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities indicated on February 29, 1996.

<TABLE>
<CAPTION>
         SIGNATURE                                        TITLE
         ---------                                        -----
<S>                           <C>
  /s/ Kenneth A. Williams     Chairman of the Board and Chief Executive Officer (Principal
---------------------------      Executive Officer)
    Kenneth A. Williams

   /s/ Michael A. Brochu      President and Chief Operating Officer
---------------------------      (Principal Financial Officer)
     Michael A. Brochu

   /s/ Fred Schapelhouman     Chief Accounting Officer
---------------------------
     Fred Schapelhouman

   /s/ Thomas L. Beckman      Director
---------------------------
     Thomas L. Beckman

/s/ Michael G. Berolzheimer   Director
---------------------------
  Michael G. Berolzheimer

                              Director
---------------------------
      Walter A. Forbes

  /s/ Marvin H. Green, Jr.    Director
---------------------------
    Marvin H. Green, Jr.

    /s/ David C. Hodgson      Director
---------------------------
      David C. Hodgson

  /s/ Roberta L. Williams     Director
---------------------------
    Roberta L. Williams
</TABLE>


                                      II-4
<PAGE>   6
                               INDEX TO EXHIBITS

<TABLE>
<CAPTION>
EXHIBIT
 NUMBER                                    DESCRIPTION
-------        -----------------------------------------------------------------
<S>            <C>
   5.1         Opinion of Perkins Coie regarding legality of the Common Stock
               being registered

  23.1         Consent of Deloitte & Touche LLP

  23.2         Consent of Perkins Coie (included in the opinion filed as Exhibit
               5.1)

  24.1         Power of Attorney (see signature page)

  99.1         Sierra On-Line, Inc. 1987 Stock Option Plan (1)

  99.2         Papyrus Design Group Inc. 1992 Stock Option Plan

  99.3         Sierra On-Line, Inc. 1993 Stock Option Grant Agreement

  99.4         Sierra On-Line, Inc. 1994 Stock Option Grant Agreement
</TABLE>

-----------

(1)  Incorporated by reference to exhibit filed with the Registrant's Annual
     Report on Form 10-K (File No. 0-17154) filed for the year ended March 31,
     1994.
[{"type": "S-8", "sequence": "1", "description": "FORM S-8 FOR SIERRA ON-LINE, INC.", "secsgml_size_bytes": 18391}]
{"company-data": {"conformed-name": "SIERRA ON LINE INC", "cik": "0000724991", "assigned-sic": "7372", "irs-number": "770164293", "state-of-incorporation": "DE", "fiscal-year-end": "0331"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-01405", "film-number": "96530709"}, "business-address": {"street1": "3380 146TH PL SE STE 300", "city": "BELLEVUE", "state": "WA", "zip": "98007", "phone": "2066499800"}, "mail-address": {"street1": "3380 1 46TH PLACE SE SUITE 300", "city": "BELLEVUE", "state": "WA", "zip": "98007"}}
1
    AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 4, 1996
                                                      REGISTRATION NO. 33-
--------------------------------------------------------------------------------

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

                                    FORM S-8
                             REGISTRATION STATEMENT
                                     UNDER
                           THE SECURITIES ACT OF 1933

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

                              SIERRA ON-LINE, INC.
             (Exact name of Registrant as specified in its charter)
DELAWARE                                               77-0164293
(State or other jurisdiction of incorporation or organization)       (I.R.S. Employer Identification No.)
3380 - 146TH PLACE S.E., SUITE 300
                           BELLEVUE, WASHINGTON 98007
          (Address of principal executive offices, including zip code)

                  SIERRA ON-LINE, INC. 1987 STOCK OPTION PLAN
                PAPYRUS DESIGN GROUP INC. 1992 STOCK OPTION PLAN
             SIERRA ON-LINE, INC. 1993 STOCK OPTION GRANT AGREEMENT
             SIERRA ON-LINE, INC. 1994 STOCK OPTION GRANT AGREEMENT
                           (Full titles of the plans)

                               RICHARD K. THUMANN
                                GENERAL COUNSEL
                       3380 - 146TH PLACE S.E., SUITE 300
                           BELLEVUE, WASHINGTON 98007
                                 (206) 649-9800
(Name, address and telephone number, including area code, of agent for service)

                             ----------------------
                                    COPY TO:

                               STEPHEN A. MCKEON
                                DAVID C. CLARKE
                                  PERKINS COIE
                         1201 THIRD AVENUE, 40TH FLOOR
                         SEATTLE, WASHINGTON 98101-3099

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

                        CALCULATION OF REGISTRATION FEE
==================================================================================================================================
    TITLE OF SECURITIES                  AMOUNT TO BE        PROPOSED MAXIMUM             PROPOSED MAXIMUM           AMOUNT OF
     TO BE REGISTERED                    REGISTERED(1)  OFFERING PRICE PER SHARE(2)  AGGREGATE OFFERING PRICE(2)  REGISTRATION FEE
----------------------------------------------------------------------------------------------------------------------------------
Common Stock, $.01 par value per share:
   Sierra On-Line, Inc.
     1987 Stock Option Plan                  800,000               $36.4375                 $40,102,894               $13,829
   Papyrus Design Group
     Inc. 1992 Stock                         230,594
     Option Plan
     Sierra On-Line, Inc.
     1993 Stock Option                        40,000
     Grant Agreement
     Sierra On-Line, Inc.
     1994 Stock Option                        30,000
     Grant Agreement
                                           ---------
  TOTAL                                    1,100,594
==================================================================================================================================
(1)      Together with an indeterminate number of additional shares that may be
         necessary to adjust the number of shares reserved for issuance under
         the Sierra On-Line, Inc. 1987 Stock Option Plan, the Papyrus Design
         Group Inc. 1992 Stock Option Plan, the Sierra On-Line, Inc. 1993 Stock
         Option Grant Agreement and the Sierra On-Line, Inc. 1994 Stock Option
         Grant Agreement as the result of any future stock split, stock dividend
         or similar adjustment of the outstanding Common Stock of the
         Registrant.

(2)      Estimated pursuant to Rule 457(h) under the Securities Act of 1933, as
         amended, solely for the purpose of calculating the registration fee.
2
                                    PART II

               INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

ITEM 3.  INCORPORATION OF DOCUMENTS BY REFERENCE

         The following documents are hereby incorporated by reference in this
Registration Statement:

                  (a) The Registrant's Annual Report on Form 10-K for the fiscal
year ended March 31, 1995 filed with the Securities and Exchange Commission (the
"Commission") (as amended by the Registrant's Quarterly Report on Form 10-Q for
the quarter ended December 31, 1995);

                  (b) All other reports filed by the Registrant pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), since the end of the fiscal year covered by the Form 10-K
referred to in (a) above; and

                  (c) The description of the Registrant's Common Stock contained
in the Registration Statement on Form 8-A filed with the Commission under
Section 12(g) of the Exchange Act, including any amendment or reports filed for
the purpose of updating such description.

         All documents filed by the Registrant pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act after the date hereof and prior to the
filing of a post-effective amendment, which indicates that the securities
offered hereby have been sold or which deregisters the securities covered hereby
then remaining unsold, shall also be deemed to be incorporated by reference into
this Registration Statement and to be a part hereof commencing on the respective
dates on which such documents are filed.

ITEM 6.  INDEMNIFICATION OF DIRECTORS AND OFFICERS

         Section 145 of the Delaware General Corporation Law provides that a
corporation may indemnify its directors and officers as well as other employees
and individuals against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement in connection with specified actions, suits or
proceedings, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the corporation--a "derivative action"), if
they acted in good faith and in a manner they reasonably believed to be in or
not opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe their conduct
was unlawful. A similar standard is applicable in the case of derivative
actions, except that indemnification only extends to expenses (including
attorneys' fees) incurred in connection with the defense or settlement of such
actions, and the statute requires court approval before there can be any
indemnification where the person seeking indemnification has been found liable
to the corporation. The statute provides that it is not exclusive of other
indemnification that may be granted by a corporation's charter, by-laws,
disinterested director vote, stockholder vote, agreement or otherwise.

         Article VI of the Registrant's By-Laws requires indemnification to the
full extent permitted under Delaware law as from time to time in effect. Subject
to any restrictions imposed by Delaware law, the By-Laws provide an
unconditional right to indemnification for all expenses, liability and loss
(including attorneys' fees, judgments, fines, ERISA excise taxes or penalties
and amounts paid in settlement) actually and reasonably incurred or suffered by
any person in connection with any actual or threatened action, suit or
proceeding, whether civil, criminal, administrative or investigative (including,
to the extent permitted by law, any derivative action) by reason of the fact
that such person is or was serving as a director or officer of the Registrant or
that, being or having been a director or officer or an employee of the
Registrant, such person is or was serving at the request of the Registrant as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, including an employee benefit plan. The
By-Laws also provide that the Registrant may, by action of its Board of
Directors, provide indemnification to its employees and agents with the same
scope and effect as the foregoing indemnification of directors and officers.

                                      II-1
3
         Section 102(b)(7) of the Delaware General Corporation Law permits a
corporation to provide in its certificate of incorporation that a director of
the corporation shall not be personally liable to the corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability for (i) any breach of the director's duty of loyalty to the
corporation or its stockholders, (ii) acts or omissions not in good faith or
that involve intentional misconduct or a knowing violation of law, (iii)
payments of unlawful dividends or unlawful stock repurchases or redemptions, or
(iv) any transaction from which the director derived an improper personal
benefit.

         Article VII of the Registrant's Certificate of Incorporation provides
that, subject to certain limitations, a director of the Registrant shall not be
liable to the Registrant or its stockholders for monetary damages for breach of
fiduciary duty as a director. Any amendment to or repeal of such Article VII
shall not adversely affect any right or protection of a director of the
Registrant for or with respect to any acts or omissions of such director
occurring prior to such amendment or repeal.

ITEM 8.  EXHIBITS
EXHIBIT
 NUMBER                                                  DESCRIPTION
----------------------------------------------------------------------------------------------
5.1          Opinion of Perkins Coie regarding legality of the Common Stock being registered

 23.1          Consent of Deloitte & Touche LLP

 23.2          Consent of Perkins Coie (included in the opinion filed as Exhibit 5.1)

 24.1          Power of Attorney (see signature page)

 99.1          Sierra On-Line, Inc. 1987 Stock Option Plan (1)

 99.2          Papyrus Design Group Inc. 1992 Stock Option Plan

 99.3          Sierra On-Line, Inc. 1993 Stock Option Grant Agreement

 99.4          Sierra On-Line, Inc. 1994 Stock Option Grant Agreement
----------

(1)  Incorporated by reference to exhibit filed with the Registrant's Annual
     Report on Form 10-K (File No. 0-17154) filed for the year ended March 31,
     1994.

ITEM 9.  UNDERTAKINGS

A.       The undersigned Registrant hereby undertakes:

         (1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:

                   (i) To include any  prospectus  required by Section 10(a)(3)
of the Securities Act of 1933, as amended (the "Securities Act");

                  (ii) To reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this Registration
Statement; and

                 (iii) To include any material information with respect to the
plan of distribution not previously disclosed in this Registration Statement or
any material change to such information in this Registration Statement;

                                      II-2
4
provided, however, that paragraphs (1)(i) and (1)(ii) above do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in this Registration Statement.

         (2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.

         (3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.

B. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefits plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in this Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.

C. Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.

                                      II-3
5
                                   SIGNATURES

         Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Bellevue, State of Washington, on February 29,
1996.

                                       SIERRA ON-LINE, INC.

                                       By: /s/ Michael A. Brochu
                                           -------------------------------------
                                           Michael A. Brochu
                                           President and Chief Operating Officer

                               POWER OF ATTORNEY

         EACH PERSON WHOSE INDIVIDUAL SIGNATURE APPEARS BELOW HEREBY AUTHORIZES
KENNETH A. WILLIAMS AND MICHAEL A. BROCHU AND EACH OF THEM AS ATTORNEYS-IN-FACT,
WITH FULL POWER OF SUBSTITUTION, TO EXECUTE IN THE NAME AND ON BEHALF OF SUCH
PERSON, INDIVIDUALLY AND IN EACH CAPACITY STATED BELOW, AND TO FILE, ANY AND ALL
AMENDMENTS TO THIS REGISTRATION STATEMENT, INCLUDING ANY AND ALL POST-EFFECTIVE
AMENDMENTS WITH THE SECURITIES AND EXCHANGE COMMISSION OR ANY REGULATORY
AUTHORITY.

         Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities indicated on February 29, 1996.
SIGNATURE                                        TITLE
         ---------                                        -----
/s/ Kenneth A. Williams     Chairman of the Board and Chief Executive Officer (Principal
---------------------------      Executive Officer)
    Kenneth A. Williams

   /s/ Michael A. Brochu      President and Chief Operating Officer
---------------------------      (Principal Financial Officer)
     Michael A. Brochu

   /s/ Fred Schapelhouman     Chief Accounting Officer
---------------------------
     Fred Schapelhouman

   /s/ Thomas L. Beckman      Director
---------------------------
     Thomas L. Beckman

/s/ Michael G. Berolzheimer   Director
---------------------------
  Michael G. Berolzheimer

                              Director
---------------------------
      Walter A. Forbes

  /s/ Marvin H. Green, Jr.    Director
---------------------------
    Marvin H. Green, Jr.

    /s/ David C. Hodgson      Director
---------------------------
      David C. Hodgson

  /s/ Roberta L. Williams     Director
---------------------------
    Roberta L. Williams
II-4
6
                               INDEX TO EXHIBITS
EXHIBIT
 NUMBER                                    DESCRIPTION
-------        -----------------------------------------------------------------
5.1         Opinion of Perkins Coie regarding legality of the Common Stock
               being registered

  23.1         Consent of Deloitte & Touche LLP

  23.2         Consent of Perkins Coie (included in the opinion filed as Exhibit
               5.1)

  24.1         Power of Attorney (see signature page)

  99.1         Sierra On-Line, Inc. 1987 Stock Option Plan (1)

  99.2         Papyrus Design Group Inc. 1992 Stock Option Plan

  99.3         Sierra On-Line, Inc. 1993 Stock Option Grant Agreement

  99.4         Sierra On-Line, Inc. 1994 Stock Option Grant Agreement
-----------

(1)  Incorporated by reference to exhibit filed with the Registrant's Annual
     Report on Form 10-K (File No. 0-17154) filed for the year ended March 31,
     1994.