Ownership Submission
FORM 4
Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940
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(Print or Type Responses)
1. Name and Address of Reporting Person *
PAYNER MELISSA
   2. Issuer Name and Ticker or Trading Symbol
BLUEFLY INC [BFLY] 		5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
__X__ Director _____ 10% Owner
__X__ Officer (give title below) _____ Other (specify below)
Chief Executive Officer
(Last)
(First)
(Middle)
C/O BLUEFLY, INC., 42 WEST 39TH STREET,9TH FLOOR		 3. Date of Earliest Transaction (Month/Day/Year)
11/13/2006
(Street)

NEW YORK,, NY 10018		 4. If Amendment, Date Original Filed(Month/Day/Year)
 6. Individual or Joint/Group Filing(Check Applicable Line)
_X_ Form filed by One Reporting Person
___ Form filed by More than One Reporting Person
(City)
(State)
(Zip)
Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1.Title of Security
(Instr. 3)		 2. Transaction Date (Month/Day/Year) 2A. Deemed Execution Date, if any (Month/Day/Year) 3. Transaction Code
(Instr. 8)		 4. Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4 and 5)		 5. Amount of Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 3 and 4)		 6. Ownership Form: Direct (D) or Indirect (I)
(Instr. 4)		 7. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V Amount (A) or (D) Price
Common Stock 11/13/2006   A   591,256 (1) A (2) 591,256 D  

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Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned
(e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security
(Instr. 3)		 2. Conversion or Exercise Price of Derivative Security 3. Transaction Date (Month/Day/Year) 3A. Deemed Execution Date, if any (Month/Day/Year) 4. Transaction Code
(Instr. 8)		 5. Number of Derivative Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4, and 5)		 6. Date Exercisable and Expiration Date
(Month/Day/Year)		 7. Title and Amount of Underlying Securities
(Instr. 3 and 4)		 8. Price of Derivative Security
(Instr. 5)		 9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 4)		 10. Ownership Form of Derivative Security: Direct (D) or Indirect (I)
(Instr. 4)		 11. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares
Deferred Stock Units $ 0 11/13/2006   A   126,904     (3)   (3) Common Stock 126,904 (4) 126,904 D  
Deferred Stock Units $ 0 11/13/2006   A   4,201,832 (5)     (6)   (6) Common Stock 4,201,832 $ 0 4,201,832 D  
Options $ 1.56 11/13/2006   D   1,300,000     (7)   (7) Common Stock 1,300,000 (7) 0 D  
Options $ 2.08 11/13/2006   D   500,000     (7)   (7) Common Stock 500,000 (7) 0 D  
Options $ 2.49 11/13/2006   D   100,000     (7)   (7) Common Stock 100,000 (7) 0 D  

Reporting Owners

Reporting Owner Name / Address Relationships
 Director  10% Owner  Officer  Other
PAYNER MELISSA
C/O BLUEFLY, INC.
42 WEST 39TH STREET,9TH FLOOR
NEW YORK,, NY 10018		   X     Chief Executive Officer  

Signatures

 /s/ Melissa Payner-Gregor   11/15/2006
**Signature of Reporting Person Date

Explanation of Responses:

* If the form is filed by more than one reporting person, see Instruction 4(b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1) Represents 591,256 shares of restricted stock, which vest in full on January 1, 2007.
(2) Restricted stock granted to the reporting person in exchange for the reporting person forfeiting her right to certain fully vested options that would have been exercisable to purchase an aggregate of 1,665,220 shares of common stock.
(3) The deferred stock units vest in eight equal quarterly installments commencing on October 1, 2006. There is no expiration date.
(4) Deferred stock units granted to the reporting person in exchange for the reporting person forfeiting her right to certain unvested options that would have been exerciable to purchase an aggregate of 234,780 shares of common stock.
(5) The grant of the deferred stock units is subject to shareholder approval of certain amendments to the Company's 2005 Stock Incentive Plan.
(6) The deferred stock units vest as follows: (i) one-third vest in four equal quarterly installments commencing on October 1, 2006, (ii) one-third vest in eight equal quarterly installments commencing on October 1, 2006 and (iii) one-third vest in twelve equal quarterly installments commencing on October 1, 2006. There is no expiration date.
(7) Disposed of pursuant to the reporting person's forfeiture of options as described in footnotes 2 and 4.

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