As filed with the Securities and Exchange Commission on July 31, 1997.
                                       
------------------------------------------------------------------------

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

                                    FORM S-8

                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933
                                     ------------------

                               DYNEX CAPITAL, INC.
             (Exact name of registrant as specified in its charter)

        VIRGINIA                                          52-1549373
    (State or other jurisdiction                         (IRS Employer
  of incorporation or organization)                    Identification  No.)
                                               

                          Dynex Capital, Inc.
                    10900 Nuckols Road, Third Floor
                         Glen Allen, VA 23060
               (Address of Principal Executive Offices)

                 Dynex Capital, Inc. 1992 Stock Incentive Plan (as amended)
                            (Full title of the Plan)

                                 Thomas H. Potts
                                    President
                               Dynex Capital, Inc.
                         10900 Nuckols Road, Third Floor
                           Glen Allen, Virginia 23060
                     (Name and address of agent for service)

                                       (804) 217-5800
               (Telephone number, including area code, of agent for service)

                                    Copy to:

                         Elizabeth R. Hughes, Esq.
                      Venable, Baetjer and Howard, LLP
                        1800 Mercantile Bank & Trust
                                   Bldg.
                              2 Hopkins Plaza
                         Baltimore, Maryland 21201
                               (410) 244-7400
                             ------------------

<TABLE>
<CAPTION>

                         CALCULATION OF REGISTRATION FEE

                      Amount to    Proposed maximum    Proposed     Amount of
Title of Securities       be        offering price     maximum     registration
 to be registered     registered      per share*       offering        fee
                                                        price*
================================================================================
  <S>                     <C>            <C>            <C>            <C>
 Common Stock, 
$.01 per share Par    2,400,000       $14.46875      $34,725,000     $11,974
       Value            Shares
================================================================================
<FN>
*Calculated solely for the purpose of computing the registration fee pursuant to
Rules  457(c) and (h),  based upon the average of the high and low prices of the
Common Stock reported on the New York Stock Exchange as of July 29, 1997.
</FN>
</TABLE>

<PAGE>


PART II

Item 3.           Incorporation of Documents by Reference.
                  

            The following documents  previously filed with the Commission by the
Company are incorporated herein by reference: Annual Report on Form 10-K for the
year ended  December  31,  1996;  Quarterly  Report on Form 10-Q for the quarter
ended March 31, 1997;  Current  Report on Form 8-K dated  February 27, 1997; and
the  description  of the  Company's  Common  Stock  contained  in the  Company's
Registration  Statement  on Form 8-A  under  the  Exchange  Act,  including  any
amendment or report filed to update the description.

            All  documents  filed by the Company  pursuant  to  Sections  13(a),
13(c),  14 or 15(d) of the  Exchange  Act  after  the date of this  Registration
Statement and prior to the filing of a post-effective  amendment which indicates
that all securities  offered have been sold or deregisters  all securities  then
remaining  unsold  shall be  deemed  to be  incorporated  by  reference  in this
Registration  Statement  and to be a part hereof from the date of filing of such
documents.

Item 4.           Description of Securities.

                  Not applicable.

Item 5.           Interests of Named Experts and Counsel.

            The validity of the  Securities  will be passed upon for the Company
by Venable, Baetjer and Howard, LLP, Baltimore, Maryland.

            The consolidated financial statements of the Company included in the
Company's  Report on Form 10-K for the year ended  December  31,  1996 have been
audited by KPMG Peat Marwick LLP,  independent  auditors,  as set forth in their
reports included therein,  and incorporated herein by reference.  Such financial
statements  have been  incorporated  by  reference  herein in reliance  upon the
reports of that firm and upon the  authority of that firm as experts in auditing
and accounting.

Item 6.           Indemnification of Directors and Officers.

            Pursuant  to  Section  13.1-698  of the  Corporations  Title  of the
Annotated  Code of Virginia (the  "Corporations  Code"),  unless  limited by its
articles of incorporation,  a corporation must indemnify a director who entirely
prevails in the defense of any  proceeding to which he was a party because he is
or was a director of the corporation against reasonable expenses incurred by him
in connection with the proceeding.

            Indemnification  is  permitted  pursuant to Section  13.1-697 of the
Corporations  Code by a corporation of its present and former  directors,  among
others, against judgments, penalties, fines, settlements and reasonable expenses
actually incurred by them in connection with any proceeding to which they may be
made a party by reason of their services in those or other capacities, unless it
is established  that (a) the director  failed to conduct  himself in good faith;
(b) the  director  did not  believe  (i) in the case of conduct in his  official
capacity with the corporation,  that his conduct was in the  corporation's  best
interests or (ii) in all other cases,  that his conduct was not at least opposed
to its  best  interests;  or (c) in the  case of any  criminal  proceeding,  the
director or officer had reasonable cause to believe that the act or omission was
unlawful.  In addition,  Section 13.1-697 of the Corporations Code prohibits the
indemnification  of a  director  by a  corporation  (y)  in  connection  with  a
proceeding  by or in the  right of the  corporation  in which  the  director  is
adjudged  liable  to the  corporation,  and (z) in  connection  with  any  other
proceeding  charging  improper personal benefit to him, whether or not involving
action in his official  capacity,  in which he was adjudged  liable on the basis
that personal  benefit was  improperly  received by him.  Virginia law permits a
corporation  to  indemnify a present and former  officer to the same extent as a
director.

            Section 13.1-699 of the  Corporations  Code permits a corporation to
pay  or  reimburse,  in  advance  of  the  final  disposition  of a  proceeding,
reasonable expenses (including  attorney's fees) incurred by a present or former
director or officer made a party to the  proceeding  by reason of his service in
that capacity,  provided that the corporation  shall have received (a) a written
affirmation  by the director or officer of his good faith belief that he has met
the standard of conduct necessary for indemnification by the corporation;  (b) a
written  undertaking  by or on behalf of the  officer or  director  to repay the
amount  paid  or  reimbursed  by  the  corporation  if it  shall  ultimately  be
determined that the standard of conduct was not met; and (c) a determination  is
made that the facts  then  known to those  making  the  determination  would not
preclude indemnification.

            Article FIVE of the Registrant's Articles of Incorporation  provides
as follows:

            (1)   In this Article:
                  "applicant"  means the person  seeking  indemnification  pur-
      suant  to this Article.
                  "expenses" includes counsel fees and disbursements.
                  "liability"   means  the   obligation   to  pay  a   judgment,
      settlement,  penalty, fine, including any excise tax assessed with respect
      to an employee benefit plan, or reasonable  expenses incurred with respect
      to a proceeding.
                  "party"  includes an individual  who was, is, or is threatened
      to be made a named defendant or respondent in a proceeding.
                  "proceeding"  means  any  threatened,  pending,  or  completed
      action, suit, or proceeding,  whether civil,  criminal,  administrative or
      investigative and whether formal or informal.
            (2) In any proceeding brought by a shareholder of the Corporation in
      the right of the Corporation or brought by or on behalf of shareholders of
      the Corporation, no director or officer of the Corporation shall be liable
      to the Corporation or its  shareholders  for monetary damages in excess of
      $0.00 with respect to any  transaction,  occurrence  or course of conduct,
      whether prior or subsequent to the effective date of this Article,  except
      for  liability  resulting  from such  person's  having  engaged in willful
      misconduct  or a knowing  violation  of the criminal law or any federal or
      state securities law.
            (3) The  Corporation  shall indemnify (i) any person who was or is a
      party to any proceeding,  including a proceeding  brought by a shareholder
      in the right of the Corporation or brought by or on behalf of shareholders
      of the Corporation, by reason of the fact that he is or was a director, or
      officer of the Corporation,  or (ii) any director or officer who is or was
      serving at the request of the Corporation as a director,  trustee, partner
      or officer of another  corporation,  partnership,  joint  venture,  trust,
      employee benefit plan or other enterprise,  against any liability incurred
      by him in  connection  with such  proceeding  unless he engaged in willful
      misconduct  or a  knowing  violation  of the  criminal  law.  A person  is
      considered  to be serving an employee  benefit  plan at the  Corporation's
      request  if his  duties  to the  Corporation  also  impose  duties  on, or
      otherwise  involve  services by, him to the plan or to  participants in or
      beneficiaries of the plan. The Board of Directors is hereby empowered,  by
      a majority vote of a quorum of  disinterested  Directors,  to enter into a
      contract  to  indemnify   any  Director  or  officer  in  respect  of  any
      proceedings arising from any act or omission,  whether occurring before or
      after the execution of such contract.
            (4) The  provisions  of this  Article  shall  be  applicable  to all
      proceedings commenced after the adoption hereof by the shareholders of the
      Corporation, arising from any act or omission, whether occurring before or
      after such adoption. No amendment or repeal of this Article shall have any
      effect on the rights  provided  under this Article with respect to any act
      or omission  occurring prior to such amendment or repeal.  The Corporation
      shall promptly take all such actions, and make all such determinations, as
      shall be necessary or  appropriate  to comply with its  obligation to make
      any indemnity  under this Article and shall  promptly pay or reimburse all
      reasonable  expenses,  including  attorneys'  fees,  incurred  by any such
      director or officer in connection with such actions and  determinations or
      proceedings of any kind arising therefrom.
            (5)  The   termination  of  any   proceeding  by  judgment,   order,
      settlement,  conviction,  or  upon  a  plea  of  nolo  contendere  or  its
      equivalent,  shall not of itself create a  presumption  that the applicant
      did not meet the  standard of conduct  described  in Section (2) or (3) of
      this Article.
            (6) Any  indemnification  under section (3) of this Article  (unless
      ordered by a court) shall be made by the Corporation only as authorized in
      the  specific  case  upon  a  determination  that  indemnification  of the
      applicant is proper in the circumstances because he has met the applicable
      standard of conduct set forth in section (3).
                  The determination shall be made:
                  (a)   By the Board of Directors by a majority vote of a quorum
      consisting of Directors not at the time parties to the proceeding;
                  (b) If a quorum  cannot be obtained  under  subsection  (a) of
      this section, by majority vote of a committee duly designated by the Board
      of  Directors  (in  which  designation   Directors  who  are  parties  may
      participate),  consisting  solely of two or more Directors not at the time
      parties to the proceeding;
                  (c)   By special legal counsel:
                        (i)   Selected by the Board of  Directors  or its  
      committee in the manner prescribed in subsection (a) or (b) of this 
      section; or
                        (ii) If a quorum  of the  Board of  Directors  cannot be
      obtained under  subsection  (a) of this section and a committee  cannot be
      designated under subsection (b) of this section, selected by majority vote
      of the full  Board of  Directors,  in which  selection  Directors  who are
      parties may participate; or
                  (d) By the  shareholders,  but shares  owned by or voted under
      the control of Directors who are at the time parties to the proceeding may
      not be voted on the determination.
            Any evaluation as to reasonableness of expenses shall be made in the
      same manner as the  determination  that  indemnification  is  appropriate,
      except that if the  determination  is made by special legal counsel,  such
      evaluation  as to  reasonableness  of  expenses  shall  be made  by  those
      entitled under subsection (c) of this section (6) to select counsel.
            Notwithstanding the foregoing,  in the event there has been a change
      in the  composition of a majority of the Board of Directors after the date
      of the alleged act or omission  with respect to which  indemnification  is
      claimed,  any  determination  as to  indemnification  and  advancement  of
      expenses  with respect to any claim for  indemnification  made pursuant to
      this Article  shall be made by special  legal  counsel  agreed upon by the
      Board of Directors  and the  applicant.  If the Board of Directors and the
      applicant are unable to agree upon such special legal counsel the Board of
      Directors and the applicant each shall select a nominee,  and the nominees
      shall select such special legal counsel.
            (7) (a) The  corporation  shall pay for or reimburse the  reasonable
      expenses  incurred  by any  applicant  who is a party to a  proceeding  in
      advance  of final  disposition  of the  proceeding  or the  making  of any
      determination   under   section  (3)  if  the   applicant   furnishes  the
      Corporation:
                        (i)   a written  statement  of his good faith belief 
      that he has met the standard of conduct described in section (3); and
                        (ii) a written  undertaking,  executed  personally or on
      his behalf,  to repay the advance if it is ultimately  determined  that he
      did not meet such standard of conduct.
                  (b) The  undertaking  required by paragraph (ii) of subsection
      (a) of this  section  shall  be an  unlimited  general  obligation  of the
      applicant but need not be secured and may be accepted without reference to
      financial ability to make repayment.
                  (c)  Authorizations  of payments  under this section  shall be
      made by the persons specified in section (6).
            (8) The Board of Directors is hereby empowered,  by majority vote of
      a quorum consisting of disinterested  Directors,  to cause the Corporation
      to indemnify or contract to indemnify  any person not specified in section
      (2) or (3) of this  Article  who  was,  is or may  become  a party  to any
      proceeding,  by reason of the fact that he is or was an  employee or agent
      of the Corporation, or is or was serving at the request of the Corporation
      as  director,   officer,   employee  or  agent  of  another   corporation,
      partnership,   joint  venture,  trust,  employee  benefit  plan  or  other
      enterprise,  to the same extent as if such person were specified as one to
      whom indemnification is granted in section (3). The provisions of sections
      (4) through (7) of this Article shall be applicable to any indemnification
      provided hereafter pursuant to this section (8).
            (9) The Corporation may purchase and maintain insurance to indemnify
      it  against  the whole or any  portion of the  liability  assumed by it in
      accordance  with this  Article  and may also  procure  insurance,  in such
      amounts as the Board of Directors may  determine,  on behalf of any person
      who is or was a director,  officer,  employee or agent of the Corporation,
      or is or was  serving at the  request of the  Corporation  as a  director,
      officer,  employee  or agent of another  corporation,  partnership,  joint
      venture,  trust,  employee benefit plan or other  enterprise,  against any
      liability  asserted  against or  incurred  by him in any such  capacity or
      arising from his status as such, whether or not the Corporation would have
      power to indemnify him against such liability under the provisions of this
      Article.
            (10) Every  reference  herein to directors,  officers,  employees or
      agents shall include former directors,  officers, employees and agents and
      their respective heirs, executors and administrators.  The indemnification
      hereby  provided  and  provided  hereafter  pursuant  to the power  hereby
      conferred by this Article on the Board of Directors shall not be exclusive
      of any other  rights to which any person may be  entitled,  including  any
      right under  policies of insurance that may be purchased and maintained by
      the  Corporation or others,  with respect to claims,  issues or matters in
      relation to which the  Corporation  would not have the power to  indemnify
      such person under the  provisions of this  Article.  Such rights shall not
      prevent or restrict  the power of the  Corporation  to make or provide for
      any further  indemnity,  or provisions  for  determining  entitlements  to
      indemnity, pursuant to one or more indemnification agreements,  bylaws, or
      other arrangements (including, without limitation, creation of trust funds
      or security interests funded by letters of credit or other means) approved
      by the Board of  Directors  (whether  or not any of the  directors  of the
      Corporation  shall be a party to or  beneficiary  of any such  agreements,
      bylaws, or other arrangements ); provided,  however, that any provision of
      such agreements,  bylaws or other  arrangements  shall not be effective if
      and to the extent that it is  determined to be contrary to this Article or
      applicable laws of the Commonwealth of Virginia.
            (11) Each  provision  of this  Article  shall be  severable,  and an
      adverse  determination as to any such provision shall in no way affect the
      validity of any other provision.

Item 7.           Exemption from Registration Claimed.

                  Not applicable.

Item 8.           Exhibits.

   4.1  -   Form of Common Stock Certificate (incorporated herein by reference 
            to Amendment No. 3 of the Company's Registration Statement on Form 
            S-11 (No. 33-19261) dated February 10, 1988

   4.2  -   Articles of Incorporation of the Registrant, as amended, effective
            February 2, 1988 (incorporated herein by reference to Amendment 
            No. 1 of the Company's Registration Statement on Form S-3 
            (No. 333-10783) dated March 21, 1997)

   4.3  -   Amendment to Articles of Incorporation effective December 29, 1989
            (incorporated herein by reference to Amendment No. 1 of the 
            Company's Registration Statement on Form S-3 (No. 333-10783) dated 
            March 21, 1997)

   4.4  -   Amendment to Articles of Incorporation effective August 17, 1992 
            (incorporated herein by reference to Amendment No. 1 of the 
            Company's Registration Statement on Form S-3 (No. 333-10783) dated 
            March 21, 1997)

   4.5  -   Amendment to Articles of Incorporation effective October 19, 1992 
            (incorporated herein by reference to Amendment No. 1 of the 
            Company's Registration Statement on Form S-3 (No. 333-10783) dated 
            March 21, 1997)

   4.6  -   Amendment  to Articles of  Incorporation  effective  June 27, 1995
            (incorporated herein by reference to the Company's Current Report on
            Form 8-K (File No. 1-9819), dated June 26, 1995)

   4.7  -   Amendment to Articles of Incorporation  effective October 23, 1995
            (incorporated herein by reference to the Company's Current Report on
            Form 8-K (File No. 1-9819), dated October 19, 1995)

   4.8  -   Amendment to Articles of Incorporation  effective  October 9, 1996
            (incorporated herein by reference to the Company's Current Report on
            Form 8-K (File No. 1-9819), dated October 15, 1996)

   4.9  -   Amendment to Articles of Incorporation  effective October 10, 1996
            (incorporated herein by reference to the Company's Current Report on
            Form 8-K (File No. 1-9819), dated October 15, 1996)


  4.10  -   Amendment to Articles of  Incorporation  effective  April 25, 1997
            (incorporated  herein by reference to the Company's Quarterly Report
            on Form 10-Q for the period ended March 31, 1997)

  4.11  -   Amendment  to  Articles of  Incorporation  effective  May 5, 1997
            (incorporated  herein by reference to the Company's Quarterly Report
            on Form 10-Q for the period ended March 31, 1997)

  4.12  -   Amended Bylaws of the Company (incorporated herein by reference to
            the Company's Annual Report on Form 10-K for the year ended 
            December 31, 1997)

   5.1  -   Opinion of Venable, Baetjer and Howard, LLP (filed herewith)

  23.1  -   Consent of KPMG Peat Marwick LLP (filed herewith)

  23.2  -   Consent of Venable, Baetjer and Howard, LLP (contained in Exhibit 
            5.1)

  24.1  -   Power of Attorney (included in signature page)


Item 9.           Undertakings.

            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 to include any material
information with respect to the plan of distribution not previously disclosed in
the  registration  statement or any material  change to such  information in the
registration statement;

      (2)  That,  for  the  purpose  of  determining  any  liability  under  the
Securities  Act of 1933,  as  amended,  (the  "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 the registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.

      (4) That, for purposes of determining  any liability  under the Securities
Act of 1993, each filing of the  registrant's  annual report pursuant to Section
13(a) or 15(d) of the Securities  Exchange Act of 1934 (and,  where  applicable,
each filing of an employee  benefit  plan's  annual  report  pursuant to Section
15(d) of the Securities  Exchange Act of 1934) that is incorporated by reference
in the 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."

            Insofar as indemnification for liabilities arising under the 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  Securities  and  Exchange  Commission  such
indemnification  is  against  public  policy  as  expressed  in the  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 of  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  of whether  such  indemnification  by it is against
public  policy  as  expressed  in the Act  and  will be  governed  by the  final
adjudication of such issue.



<PAGE>


                                   SIGNATURES

            Pursuant  to the  requirements  of the  Securities  Act of 1933,  as
amended,  the Registrant,  Dynex Capital,  Inc. 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  Henrico  County  in  the
Commonwealth of Virginia on this 31 day of July, 1997.

                               DYNEX CAPITAL, INC.


                               /s/ Thomas H. Potts
                              ----------------------
                              Thomas H. Potts, President
                              (Principal Executive Officer)


            Each  person  whose  signature   appears  below  does  hereby  make,
constitute  and appoint  Thomas H. Potts and Lynn K.  Geurin,  and each of them,
his/her true and lawful  attorney with the Securities  and Exchange  Commission,
for and on his/her  behalf,  and in his/her  capacity  or  capacities  as stated
below, any amendment (including  post-effective  amendments) to the Registration
Statement  with all exhibits  thereto,  making such changes in the  Registration
Statement as the Registrant deems appropriate.

            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 indicted on July 31, 1997.

<TABLE>
<CAPTION>
<S>                                              <C>
Signature                                    Capacity

/s/ Thomas H. Potts                          President and Director
--------------------------                   (Principal Executive Officer)
Thomas H. Potts

/s/ Lynn K. Geurin                           Executive Vice President,
--------------------------
Lynn K. Geurin                               (Principal Financial and
                                             Accounting Officer)

/s/ J. Sidney Davenport, IV                  Director
--------------------------
J. Sidney Davenport, IV

/s/  Richard C. Leone                        Director
--------------------------
Richard C. Leone

/s/ Paul S. Reid                             Director
--------------------------
Paul S. Reid

/s/ Donald B. Vaden                          Director
--------------------------
Donald B. Vaden

</TABLE>









                                  Exhibit Index


Exhibit Number           Description
5.1                      Opinion of Venable, Baetjer and
                         Howard, LLP

23.1                     Consent of KPMG Peat Marwick LLP
[{"type": "S-8", "sequence": "1", "description": "EMPLOYEE STOCK INCENTIVE PLAN REG.", "secsgml_size_bytes": 28892}]
{"company-data": {"conformed-name": "DYNEX CAPITAL INC", "cik": "0000826675", "assigned-sic": "6798", "irs-number": "521549373", "state-of-incorporation": "VA", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-32663", "film-number": "97650134"}, "business-address": {"street1": "10900 NUCKOLS ROAD", "street2": "SUITE 650", "city": "RICHMOND", "state": "VA", "zip": "23060", "phone": "8049675800"}, "mail-address": {"street1": "10900 NUCKOLS ROAD", "street2": "SUITE 650", "city": "RICHMOND", "state": "VA", "zip": "23060"}, "former-company": [{"former-conformed-name": "RESOURCE MORTGAGE CAPITAL INC/VA", "date-changed": "19930722"}, {"former-conformed-name": "RESOURCE MORTGAGE INVESTMENT CORP", "date-changed": "19930505"}, {"former-conformed-name": "RAC MORTGAGE INVESTMENT CORP /VA/", "date-changed": "19930505"}]}
As filed with the Securities and Exchange Commission on July 31, 1997.
                                       
------------------------------------------------------------------------

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

                                    FORM S-8

                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933
                                     ------------------

                               DYNEX CAPITAL, INC.
             (Exact name of registrant as specified in its charter)

        VIRGINIA                                          52-1549373
    (State or other jurisdiction                         (IRS Employer
  of incorporation or organization)                    Identification  No.)
                                               

                          Dynex Capital, Inc.
                    10900 Nuckols Road, Third Floor
                         Glen Allen, VA 23060
               (Address of Principal Executive Offices)

                 Dynex Capital, Inc. 1992 Stock Incentive Plan (as amended)
                            (Full title of the Plan)

                                 Thomas H. Potts
                                    President
                               Dynex Capital, Inc.
                         10900 Nuckols Road, Third Floor
                           Glen Allen, Virginia 23060
                     (Name and address of agent for service)

                                       (804) 217-5800
               (Telephone number, including area code, of agent for service)

                                    Copy to:

                         Elizabeth R. Hughes, Esq.
                      Venable, Baetjer and Howard, LLP
                        1800 Mercantile Bank & Trust
                                   Bldg.
                              2 Hopkins Plaza
                         Baltimore, Maryland 21201
                               (410) 244-7400
                             ------------------
CALCULATION OF REGISTRATION FEE

                      Amount to    Proposed maximum    Proposed     Amount of
Title of Securities       be        offering price     maximum     registration
 to be registered     registered      per share*       offering        fee
                                                        price*
================================================================================
Common Stock, 
$.01 per share Par    2,400,000       $14.46875      $34,725,000     $11,974
       Value            Shares
================================================================================
*Calculated solely for the purpose of computing the registration fee pursuant to
Rules  457(c) and (h),  based upon the average of the high and low prices of the
Common Stock reported on the New York Stock Exchange as of July 29, 1997.
PART II

Item 3.           Incorporation of Documents by Reference.
                  

            The following documents  previously filed with the Commission by the
Company are incorporated herein by reference: Annual Report on Form 10-K for the
year ended  December  31,  1996;  Quarterly  Report on Form 10-Q for the quarter
ended March 31, 1997;  Current  Report on Form 8-K dated  February 27, 1997; and
the  description  of the  Company's  Common  Stock  contained  in the  Company's
Registration  Statement  on Form 8-A  under  the  Exchange  Act,  including  any
amendment or report filed to update the description.

            All  documents  filed by the Company  pursuant  to  Sections  13(a),
13(c),  14 or 15(d) of the  Exchange  Act  after  the date of this  Registration
Statement and prior to the filing of a post-effective  amendment which indicates
that all securities  offered have been sold or deregisters  all securities  then
remaining  unsold  shall be  deemed  to be  incorporated  by  reference  in this
Registration  Statement  and to be a part hereof from the date of filing of such
documents.

Item 4.           Description of Securities.

                  Not applicable.

Item 5.           Interests of Named Experts and Counsel.

            The validity of the  Securities  will be passed upon for the Company
by Venable, Baetjer and Howard, LLP, Baltimore, Maryland.

            The consolidated financial statements of the Company included in the
Company's  Report on Form 10-K for the year ended  December  31,  1996 have been
audited by KPMG Peat Marwick LLP,  independent  auditors,  as set forth in their
reports included therein,  and incorporated herein by reference.  Such financial
statements  have been  incorporated  by  reference  herein in reliance  upon the
reports of that firm and upon the  authority of that firm as experts in auditing
and accounting.

Item 6.           Indemnification of Directors and Officers.

            Pursuant  to  Section  13.1-698  of the  Corporations  Title  of the
Annotated  Code of Virginia (the  "Corporations  Code"),  unless  limited by its
articles of incorporation,  a corporation must indemnify a director who entirely
prevails in the defense of any  proceeding to which he was a party because he is
or was a director of the corporation against reasonable expenses incurred by him
in connection with the proceeding.

            Indemnification  is  permitted  pursuant to Section  13.1-697 of the
Corporations  Code by a corporation of its present and former  directors,  among
others, against judgments, penalties, fines, settlements and reasonable expenses
actually incurred by them in connection with any proceeding to which they may be
made a party by reason of their services in those or other capacities, unless it
is established  that (a) the director  failed to conduct  himself in good faith;
(b) the  director  did not  believe  (i) in the case of conduct in his  official
capacity with the corporation,  that his conduct was in the  corporation's  best
interests or (ii) in all other cases,  that his conduct was not at least opposed
to its  best  interests;  or (c) in the  case of any  criminal  proceeding,  the
director or officer had reasonable cause to believe that the act or omission was
unlawful.  In addition,  Section 13.1-697 of the Corporations Code prohibits the
indemnification  of a  director  by a  corporation  (y)  in  connection  with  a
proceeding  by or in the  right of the  corporation  in which  the  director  is
adjudged  liable  to the  corporation,  and (z) in  connection  with  any  other
proceeding  charging  improper personal benefit to him, whether or not involving
action in his official  capacity,  in which he was adjudged  liable on the basis
that personal  benefit was  improperly  received by him.  Virginia law permits a
corporation  to  indemnify a present and former  officer to the same extent as a
director.

            Section 13.1-699 of the  Corporations  Code permits a corporation to
pay  or  reimburse,  in  advance  of  the  final  disposition  of a  proceeding,
reasonable expenses (including  attorney's fees) incurred by a present or former
director or officer made a party to the  proceeding  by reason of his service in
that capacity,  provided that the corporation  shall have received (a) a written
affirmation  by the director or officer of his good faith belief that he has met
the standard of conduct necessary for indemnification by the corporation;  (b) a
written  undertaking  by or on behalf of the  officer or  director  to repay the
amount  paid  or  reimbursed  by  the  corporation  if it  shall  ultimately  be
determined that the standard of conduct was not met; and (c) a determination  is
made that the facts  then  known to those  making  the  determination  would not
preclude indemnification.

            Article FIVE of the Registrant's Articles of Incorporation  provides
as follows:

            (1)   In this Article:
                  "applicant"  means the person  seeking  indemnification  pur-
      suant  to this Article.
                  "expenses" includes counsel fees and disbursements.
                  "liability"   means  the   obligation   to  pay  a   judgment,
      settlement,  penalty, fine, including any excise tax assessed with respect
      to an employee benefit plan, or reasonable  expenses incurred with respect
      to a proceeding.
                  "party"  includes an individual  who was, is, or is threatened
      to be made a named defendant or respondent in a proceeding.
                  "proceeding"  means  any  threatened,  pending,  or  completed
      action, suit, or proceeding,  whether civil,  criminal,  administrative or
      investigative and whether formal or informal.
            (2) In any proceeding brought by a shareholder of the Corporation in
      the right of the Corporation or brought by or on behalf of shareholders of
      the Corporation, no director or officer of the Corporation shall be liable
      to the Corporation or its  shareholders  for monetary damages in excess of
      $0.00 with respect to any  transaction,  occurrence  or course of conduct,
      whether prior or subsequent to the effective date of this Article,  except
      for  liability  resulting  from such  person's  having  engaged in willful
      misconduct  or a knowing  violation  of the criminal law or any federal or
      state securities law.
            (3) The  Corporation  shall indemnify (i) any person who was or is a
      party to any proceeding,  including a proceeding  brought by a shareholder
      in the right of the Corporation or brought by or on behalf of shareholders
      of the Corporation, by reason of the fact that he is or was a director, or
      officer of the Corporation,  or (ii) any director or officer who is or was
      serving at the request of the Corporation as a director,  trustee, partner
      or officer of another  corporation,  partnership,  joint  venture,  trust,
      employee benefit plan or other enterprise,  against any liability incurred
      by him in  connection  with such  proceeding  unless he engaged in willful
      misconduct  or a  knowing  violation  of the  criminal  law.  A person  is
      considered  to be serving an employee  benefit  plan at the  Corporation's
      request  if his  duties  to the  Corporation  also  impose  duties  on, or
      otherwise  involve  services by, him to the plan or to  participants in or
      beneficiaries of the plan. The Board of Directors is hereby empowered,  by
      a majority vote of a quorum of  disinterested  Directors,  to enter into a
      contract  to  indemnify   any  Director  or  officer  in  respect  of  any
      proceedings arising from any act or omission,  whether occurring before or
      after the execution of such contract.
            (4) The  provisions  of this  Article  shall  be  applicable  to all
      proceedings commenced after the adoption hereof by the shareholders of the
      Corporation, arising from any act or omission, whether occurring before or
      after such adoption. No amendment or repeal of this Article shall have any
      effect on the rights  provided  under this Article with respect to any act
      or omission  occurring prior to such amendment or repeal.  The Corporation
      shall promptly take all such actions, and make all such determinations, as
      shall be necessary or  appropriate  to comply with its  obligation to make
      any indemnity  under this Article and shall  promptly pay or reimburse all
      reasonable  expenses,  including  attorneys'  fees,  incurred  by any such
      director or officer in connection with such actions and  determinations or
      proceedings of any kind arising therefrom.
            (5)  The   termination  of  any   proceeding  by  judgment,   order,
      settlement,  conviction,  or  upon  a  plea  of  nolo  contendere  or  its
      equivalent,  shall not of itself create a  presumption  that the applicant
      did not meet the  standard of conduct  described  in Section (2) or (3) of
      this Article.
            (6) Any  indemnification  under section (3) of this Article  (unless
      ordered by a court) shall be made by the Corporation only as authorized in
      the  specific  case  upon  a  determination  that  indemnification  of the
      applicant is proper in the circumstances because he has met the applicable
      standard of conduct set forth in section (3).
                  The determination shall be made:
                  (a)   By the Board of Directors by a majority vote of a quorum
      consisting of Directors not at the time parties to the proceeding;
                  (b) If a quorum  cannot be obtained  under  subsection  (a) of
      this section, by majority vote of a committee duly designated by the Board
      of  Directors  (in  which  designation   Directors  who  are  parties  may
      participate),  consisting  solely of two or more Directors not at the time
      parties to the proceeding;
                  (c)   By special legal counsel:
                        (i)   Selected by the Board of  Directors  or its  
      committee in the manner prescribed in subsection (a) or (b) of this 
      section; or
                        (ii) If a quorum  of the  Board of  Directors  cannot be
      obtained under  subsection  (a) of this section and a committee  cannot be
      designated under subsection (b) of this section, selected by majority vote
      of the full  Board of  Directors,  in which  selection  Directors  who are
      parties may participate; or
                  (d) By the  shareholders,  but shares  owned by or voted under
      the control of Directors who are at the time parties to the proceeding may
      not be voted on the determination.
            Any evaluation as to reasonableness of expenses shall be made in the
      same manner as the  determination  that  indemnification  is  appropriate,
      except that if the  determination  is made by special legal counsel,  such
      evaluation  as to  reasonableness  of  expenses  shall  be made  by  those
      entitled under subsection (c) of this section (6) to select counsel.
            Notwithstanding the foregoing,  in the event there has been a change
      in the  composition of a majority of the Board of Directors after the date
      of the alleged act or omission  with respect to which  indemnification  is
      claimed,  any  determination  as to  indemnification  and  advancement  of
      expenses  with respect to any claim for  indemnification  made pursuant to
      this Article  shall be made by special  legal  counsel  agreed upon by the
      Board of Directors  and the  applicant.  If the Board of Directors and the
      applicant are unable to agree upon such special legal counsel the Board of
      Directors and the applicant each shall select a nominee,  and the nominees
      shall select such special legal counsel.
            (7) (a) The  corporation  shall pay for or reimburse the  reasonable
      expenses  incurred  by any  applicant  who is a party to a  proceeding  in
      advance  of final  disposition  of the  proceeding  or the  making  of any
      determination   under   section  (3)  if  the   applicant   furnishes  the
      Corporation:
                        (i)   a written  statement  of his good faith belief 
      that he has met the standard of conduct described in section (3); and
                        (ii) a written  undertaking,  executed  personally or on
      his behalf,  to repay the advance if it is ultimately  determined  that he
      did not meet such standard of conduct.
                  (b) The  undertaking  required by paragraph (ii) of subsection
      (a) of this  section  shall  be an  unlimited  general  obligation  of the
      applicant but need not be secured and may be accepted without reference to
      financial ability to make repayment.
                  (c)  Authorizations  of payments  under this section  shall be
      made by the persons specified in section (6).
            (8) The Board of Directors is hereby empowered,  by majority vote of
      a quorum consisting of disinterested  Directors,  to cause the Corporation
      to indemnify or contract to indemnify  any person not specified in section
      (2) or (3) of this  Article  who  was,  is or may  become  a party  to any
      proceeding,  by reason of the fact that he is or was an  employee or agent
      of the Corporation, or is or was serving at the request of the Corporation
      as  director,   officer,   employee  or  agent  of  another   corporation,
      partnership,   joint  venture,  trust,  employee  benefit  plan  or  other
      enterprise,  to the same extent as if such person were specified as one to
      whom indemnification is granted in section (3). The provisions of sections
      (4) through (7) of this Article shall be applicable to any indemnification
      provided hereafter pursuant to this section (8).
            (9) The Corporation may purchase and maintain insurance to indemnify
      it  against  the whole or any  portion of the  liability  assumed by it in
      accordance  with this  Article  and may also  procure  insurance,  in such
      amounts as the Board of Directors may  determine,  on behalf of any person
      who is or was a director,  officer,  employee or agent of the Corporation,
      or is or was  serving at the  request of the  Corporation  as a  director,
      officer,  employee  or agent of another  corporation,  partnership,  joint
      venture,  trust,  employee benefit plan or other  enterprise,  against any
      liability  asserted  against or  incurred  by him in any such  capacity or
      arising from his status as such, whether or not the Corporation would have
      power to indemnify him against such liability under the provisions of this
      Article.
            (10) Every  reference  herein to directors,  officers,  employees or
      agents shall include former directors,  officers, employees and agents and
      their respective heirs, executors and administrators.  The indemnification
      hereby  provided  and  provided  hereafter  pursuant  to the power  hereby
      conferred by this Article on the Board of Directors shall not be exclusive
      of any other  rights to which any person may be  entitled,  including  any
      right under  policies of insurance that may be purchased and maintained by
      the  Corporation or others,  with respect to claims,  issues or matters in
      relation to which the  Corporation  would not have the power to  indemnify
      such person under the  provisions of this  Article.  Such rights shall not
      prevent or restrict  the power of the  Corporation  to make or provide for
      any further  indemnity,  or provisions  for  determining  entitlements  to
      indemnity, pursuant to one or more indemnification agreements,  bylaws, or
      other arrangements (including, without limitation, creation of trust funds
      or security interests funded by letters of credit or other means) approved
      by the Board of  Directors  (whether  or not any of the  directors  of the
      Corporation  shall be a party to or  beneficiary  of any such  agreements,
      bylaws, or other arrangements ); provided,  however, that any provision of
      such agreements,  bylaws or other  arrangements  shall not be effective if
      and to the extent that it is  determined to be contrary to this Article or
      applicable laws of the Commonwealth of Virginia.
            (11) Each  provision  of this  Article  shall be  severable,  and an
      adverse  determination as to any such provision shall in no way affect the
      validity of any other provision.

Item 7.           Exemption from Registration Claimed.

                  Not applicable.

Item 8.           Exhibits.

   4.1  -   Form of Common Stock Certificate (incorporated herein by reference 
            to Amendment No. 3 of the Company's Registration Statement on Form 
            S-11 (No. 33-19261) dated February 10, 1988

   4.2  -   Articles of Incorporation of the Registrant, as amended, effective
            February 2, 1988 (incorporated herein by reference to Amendment 
            No. 1 of the Company's Registration Statement on Form S-3 
            (No. 333-10783) dated March 21, 1997)

   4.3  -   Amendment to Articles of Incorporation effective December 29, 1989
            (incorporated herein by reference to Amendment No. 1 of the 
            Company's Registration Statement on Form S-3 (No. 333-10783) dated 
            March 21, 1997)

   4.4  -   Amendment to Articles of Incorporation effective August 17, 1992 
            (incorporated herein by reference to Amendment No. 1 of the 
            Company's Registration Statement on Form S-3 (No. 333-10783) dated 
            March 21, 1997)

   4.5  -   Amendment to Articles of Incorporation effective October 19, 1992 
            (incorporated herein by reference to Amendment No. 1 of the 
            Company's Registration Statement on Form S-3 (No. 333-10783) dated 
            March 21, 1997)

   4.6  -   Amendment  to Articles of  Incorporation  effective  June 27, 1995
            (incorporated herein by reference to the Company's Current Report on
            Form 8-K (File No. 1-9819), dated June 26, 1995)

   4.7  -   Amendment to Articles of Incorporation  effective October 23, 1995
            (incorporated herein by reference to the Company's Current Report on
            Form 8-K (File No. 1-9819), dated October 19, 1995)

   4.8  -   Amendment to Articles of Incorporation  effective  October 9, 1996
            (incorporated herein by reference to the Company's Current Report on
            Form 8-K (File No. 1-9819), dated October 15, 1996)

   4.9  -   Amendment to Articles of Incorporation  effective October 10, 1996
            (incorporated herein by reference to the Company's Current Report on
            Form 8-K (File No. 1-9819), dated October 15, 1996)

  4.10  -   Amendment to Articles of  Incorporation  effective  April 25, 1997
            (incorporated  herein by reference to the Company's Quarterly Report
            on Form 10-Q for the period ended March 31, 1997)

  4.11  -   Amendment  to  Articles of  Incorporation  effective  May 5, 1997
            (incorporated  herein by reference to the Company's Quarterly Report
            on Form 10-Q for the period ended March 31, 1997)

  4.12  -   Amended Bylaws of the Company (incorporated herein by reference to
            the Company's Annual Report on Form 10-K for the year ended 
            December 31, 1997)

   5.1  -   Opinion of Venable, Baetjer and Howard, LLP (filed herewith)

  23.1  -   Consent of KPMG Peat Marwick LLP (filed herewith)

  23.2  -   Consent of Venable, Baetjer and Howard, LLP (contained in Exhibit 
            5.1)

  24.1  -   Power of Attorney (included in signature page)

Item 9.           Undertakings.

            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 to include any material
information with respect to the plan of distribution not previously disclosed in
the  registration  statement or any material  change to such  information in the
registration statement;

      (2)  That,  for  the  purpose  of  determining  any  liability  under  the
Securities  Act of 1933,  as  amended,  (the  "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 the registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.

      (4) That, for purposes of determining  any liability  under the Securities
Act of 1993, each filing of the  registrant's  annual report pursuant to Section
13(a) or 15(d) of the Securities  Exchange Act of 1934 (and,  where  applicable,
each filing of an employee  benefit  plan's  annual  report  pursuant to Section
15(d) of the Securities  Exchange Act of 1934) that is incorporated by reference
in the 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."

            Insofar as indemnification for liabilities arising under the 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  Securities  and  Exchange  Commission  such
indemnification  is  against  public  policy  as  expressed  in the  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 of  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  of whether  such  indemnification  by it is against
public  policy  as  expressed  in the Act  and  will be  governed  by the  final
adjudication of such issue.
SIGNATURES

            Pursuant  to the  requirements  of the  Securities  Act of 1933,  as
amended,  the Registrant,  Dynex Capital,  Inc. 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  Henrico  County  in  the
Commonwealth of Virginia on this 31 day of July, 1997.

                               DYNEX CAPITAL, INC.

                               /s/ Thomas H. Potts
                              ----------------------
                              Thomas H. Potts, President
                              (Principal Executive Officer)

            Each  person  whose  signature   appears  below  does  hereby  make,
constitute  and appoint  Thomas H. Potts and Lynn K.  Geurin,  and each of them,
his/her true and lawful  attorney with the Securities  and Exchange  Commission,
for and on his/her  behalf,  and in his/her  capacity  or  capacities  as stated
below, any amendment (including  post-effective  amendments) to the Registration
Statement  with all exhibits  thereto,  making such changes in the  Registration
Statement as the Registrant deems appropriate.

            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 indicted on July 31, 1997.
Signature                                    Capacity

/s/ Thomas H. Potts                          President and Director
--------------------------                   (Principal Executive Officer)
Thomas H. Potts

/s/ Lynn K. Geurin                           Executive Vice President,
--------------------------
Lynn K. Geurin                               (Principal Financial and
                                             Accounting Officer)

/s/ J. Sidney Davenport, IV                  Director
--------------------------
J. Sidney Davenport, IV

/s/  Richard C. Leone                        Director
--------------------------
Richard C. Leone

/s/ Paul S. Reid                             Director
--------------------------
Paul S. Reid

/s/ Donald B. Vaden                          Director
--------------------------
Donald B. Vaden
Exhibit Index

Exhibit Number           Description
5.1                      Opinion of Venable, Baetjer and
                         Howard, LLP

23.1                     Consent of KPMG Peat Marwick LLP