content: SECURITIES AND EXCHANGE COMMISSION
  
                       WASHINGTON, D.C. 20549
  
                                  
  
                              FORM 8-K
  
                           CURRENT REPORT
  
                                  
  
               PURSUANT TO SECTION 13 OR 15 (D) OF THE
  
                   SECURITIES EXCHANGE ACT OF 1934
  
                                  
  
                           Date of Report
        (Date of earliest event reported) September 19, 1996
                                  
  
                            NESTOR, INC.
  
              (Exact name of registrant as specified in charter)
  
                                  
  
                                  
  
  Delaware                      0-12-965        13-3163744
  (State of other jurisdiction  (Commission     IRS employer
  of incorporation)             file number)    identification no.
  
  
  
  
  One Richmond Square, Providence, Rhode Island  02906
       (Address of principal executive offices)
  
  
  Registrant's telephone number, including area code: 401-331-9640
  
                                  
  
                                N/A
  
     (Former name or former address, if changed since last report)
  
  
  
  
  
  
  Item 5.        Other Events.
  
       1) The Corporation entered into a Prism Non-Exclusive
  
  License Agreement dated September 19, 1996, by and between the
  
  Corporation and Applied Communications, Inc. ("ACI") allowing ACI
  
  to integrate the Corporation's PRISM product into ACI's products
  
  and to distribute sublicensed copies.  A copy of such License
  
  Agreement is annexed as an exhibit hereto.
  
  
  
  
  
  
  
                              EXHIBITS
  
  
  The Following exhibit is filed herewith:
  
  Exhibit No.         Description
  
    10.31             Prism Non-Exclusive License Agreement dated 
  
                      as of September 19, 1996 between Nestor, Inc.
  
                      and Applied Communications, Inc.
  
  
  
                                  
                             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.
  
  
  Dated:  October 4, 1996            NESTOR, INC.
  
                                     (Registrant)
  
  
                                     By:
                                        /S/ Herbert S. Meeker
                                        Secretary
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text: SECURITIES AND EXCHANGE COMMISSION
  
                       WASHINGTON, D.C. 20549
  
                                  
  
                              FORM 8-K
  
                           CURRENT REPORT
  
                                  
  
               PURSUANT TO SECTION 13 OR 15 (D) OF THE
  
                   SECURITIES EXCHANGE ACT OF 1934
  
                                  
  
                           Date of Report
        (Date of earliest event reported) September 19, 1996
                                  
  
                            NESTOR, INC.
  
              (Exact name of registrant as specified in charter)
  
                                  
  
                                  
  
  Delaware                      0-12-965        13-3163744
  (State of other jurisdiction  (Commission     IRS employer
  of incorporation)             file number)    identification no.
  
  One Richmond Square, Providence, Rhode Island  02906
       (Address of principal executive offices)
  
  Registrant's telephone number, including area code: 401-331-9640
  
                                  
  
                                N/A
  
     (Former name or former address, if changed since last report)
  
  Item 5.        Other Events.
  
       1) The Corporation entered into a Prism Non-Exclusive
  
  License Agreement dated September 19, 1996, by and between the
  
  Corporation and Applied Communications, Inc. ("ACI") allowing ACI
  
  to integrate the Corporation's PRISM product into ACI's products
  
  and to distribute sublicensed copies.  A copy of such License
  
  Agreement is annexed as an exhibit hereto.
  
                              EXHIBITS
  
  The Following exhibit is filed herewith:
  
  Exhibit No.         Description
  
    10.31             Prism Non-Exclusive License Agreement dated 
  
                      as of September 19, 1996 between Nestor, Inc.
  
                      and Applied Communications, Inc.
  
                                  
                             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.
  
  Dated:  October 4, 1996            NESTOR, INC.
  
                                     (Registrant)
  
                                     By:
                                        /S/ Herbert S. Meeker
                                        Secretary