


                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  SCHEDULE 13D
                                 (Rule 13d-101)

             INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
            TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
                                  RULE 13d-2(a)

                                (Amendment No. )*

                                  BLUEFLY, INC.
                             ______________________
                                (Name of Issuer)

                     Common Stock, Par Value $0.01 Per Share
                  _________________________________________________
                         (Title of Class of Securities)

                                    096227103
                                 ______________
                                 (CUSIP Number)

                              Stephen M. Vine, Esq.
                    Akin, Gump, Strauss, Hauer & Feld, L.L.P.
                               590 Madison Avenue
                            New York, New York 10022
                                 (212) 872-1000
              _____________________________________________________
                  (Name, Address and Telephone Number of Person
                Authorized to Receive Notices and Communications)

                                  July 27, 1999
                     _______________________________________
                      (Date of Event which Requires Filing
                               of this Statement)

If the filing person has previously  filed a statement on Schedule 13G to report
the  acquisition  that is the subject of this  Schedule  13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box
|_|.

Note.  Schedules  filed in paper format shall include a signed original and five
copies of the  schedule,  including  all  exhibits.  See Rule 13d-7(b) for other
parties to whom copies are to be sent.

*The  remainder of this cover page shall be filled out for a reporting  person's
initial filing on this form with respect to the subject class of securities, and
for  any  subsequent   amendment   containing   information  which  would  alter
disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the  Securities  Exchange  Act of
1934 or  otherwise  subject to the  liabilities  of that  section of the Act but
shall be subject to all other provisions of the Act (however, see the Notes).

                         Continued on following page(s)
                               Page 1 of 79 Pages
                             Exhibit Index: Page 19


<PAGE>


                                                              Page 2 of 79 Pages

                                  SCHEDULE 13D

CUSIP No. 096227103

1        Name of Reporting Person
         S.S. or I.R.S. Identification No. of Above Person

                  QUANTUM INDUSTRIAL PARTNERS LDC

2        Check the Appropriate Box If a Member of a Group*
                                                     a.  [ ]
                                                     b.  [x]

3        SEC Use Only

4        Source of Funds*

                  WC

5        Check Box If Disclosure of Legal  Proceedings  Is Required  Pursuant to
         Items 2(d) or 2(e)        [ ]

6        Citizenship or Place of Organization

                  Cayman Islands

                           7        Sole Voting Power
  Number of                                 442,643
   Shares
Beneficially               8        Shared Voting Power
  Owned By                                  0
    Each
  Reporting                9        Sole Dispositive Power
   Person                                   442,643
    With
                           10       Shared Dispositive Power
                                            0

11       Aggregate Amount Beneficially Owned by Each Reporting Person

                                            442,643 /1/

12       Check Box If the Aggregate Amount in Row (11) Excludes Certain
         Shares*                                           [x]

13       Percent of Class Represented By Amount in Row (11)

                                    8.29%

14       Type of Reporting Person*

                  OO; IV

____________________
/1/ Excludes certain shares.  See Item 5.


                      *SEE INSTRUCTIONS BEFORE FILLING OUT!


<PAGE>


                                                              Page 3 of 79 Pages

                                  SCHEDULE 13D

CUSIP No. 096227103

1        Name of Reporting Person
         S.S. or I.R.S. Identification No. of Above Person

                  QIH MANAGEMENT INVESTOR, L.P.

2        Check the Appropriate Box If a Member of a Group*
                                                     a.  [ ]
                                                     b.  [x]

3        SEC Use Only

4        Source of Funds*

                  AF

5        Check Box If Disclosure of Legal  Proceedings  Is Required  Pursuant to
         Items 2(d) or 2(e)             [ ]

6        Citizenship or Place of Organization

                  Delaware

                           7        Sole Voting Power
  Number of                                 442,643
   Shares
Beneficially               8        Shared Voting Power
  Owned By                                  0
   Each
  Reporting                9        Sole Dispositive Power
   Person                                   442,643
    With
                           10       Shared Dispositive Power
                                            0

11       Aggregate Amount Beneficially Owned by Each Reporting Person

                                            442,643 /1/

12       Check Box If the Aggregate Amount in Row (11) Excludes Certain
         Shares*                                            [x]

13       Percent of Class Represented By Amount in Row (11)

                                    8.29%
14       Type of Reporting Person*

                  PN; IA

____________________
/1/ Excludes certain shares.  See Item 5.


                      *SEE INSTRUCTIONS BEFORE FILLING OUT!


<PAGE>


                                                              Page 4 of 79 Pages

                                  SCHEDULE 13D

CUSIP No. 096227103

1        Name of Reporting Person
         S.S. or I.R.S. Identification No. of Above Person

                  QIH MANAGEMENT, INC.

2        Check the Appropriate Box If a Member of a Group*
                                                     a.  [ ]
                                                     b.  [x]

3        SEC Use Only

4        Source of Funds*

                  AF

5        Check Box If Disclosure of Legal  Proceedings  Is Required  Pursuant to
         Items 2(d) or 2(e)             [ ]

6        Citizenship or Place of Organization

                  Delaware

                           7        Sole Voting Power
  Number of                                 442,643
   Shares
Beneficially               8        Shared Voting Power
  Owned By                                  0
   Each
  Reporting                9        Sole Dispositive Power
   Person                                   442,643
    With
                           10       Shared Dispositive Power
                                            0

11       Aggregate Amount Beneficially Owned by Each Reporting Person

                                            442,643 /1/

12       Check Box If the Aggregate Amount in Row (11) Excludes Certain
         Shares*                                             [x]

13       Percent of Class Represented By Amount in Row (11)

                                    8.29%

14       Type of Reporting Person*

                  CO

____________________
/1/ Excludes certain shares.  See Item 5.

                      *SEE INSTRUCTIONS BEFORE FILLING OUT!


<PAGE>


                                                              Page 5 of 79 Pages

                                  SCHEDULE 13D

CUSIP No. 096227103

1        Name of Reporting Person
         S.S. or I.R.S. Identification No. of Above Person

                  SOROS FUND MANAGEMENT LLC

2        Check the Appropriate Box If a Member of a Group*
                                                     a.  [ ]
                                                     b.  [x]

3        SEC Use Only

4        Source of Funds*

                  AF

5        Check Box If Disclosure of Legal  Proceedings  Is Required  Pursuant to
         Items 2(d) or 2(e)             [ ]

6        Citizenship or Place of Organization

                  Delaware

                           7        Sole Voting Power
  Number of                                 442,643
   Shares
Beneficially               8        Shared Voting Power
  Owned By                                  0
    Each
  Reporting                9        Sole Dispositive Power
   Person                                   442,643
    With
                           10       Shared Dispositive Power
                                            0

11       Aggregate Amount Beneficially Owned by Each Reporting Person

                                            442,643 /1/

12       Check Box If the Aggregate Amount in Row (11) Excludes Certain
         Shares*                                              [x]

13       Percent of Class Represented By Amount in Row (11)

                                    8.29%

14       Type of Reporting Person*

                  OO; IA


____________________
/1/ Excludes certain shares.  See Item 5.


                      *SEE INSTRUCTIONS BEFORE FILLING OUT!


<PAGE>


                                                              Page 6 of 79 Pages

                                  SCHEDULE 13D

CUSIP No. 096227103

1        Name of Reporting Person
         S.S. or I.R.S. Identification No. of Above Person

                  GEORGE SOROS (in the capacity described herein)

2        Check the Appropriate Box If a Member of a Group*
                                                     a.  [ ]
                                                     b.  [x]

3        SEC Use Only

4        Source of Funds*

                  AF

5        Check Box If Disclosure of Legal  Proceedings  Is Required  Pursuant to
         Items 2(d) or 2(e)                   [ ]

6        Citizenship or Place of Organization

                  United States

                           7        Sole Voting Power
  Number of                                  14,499
   Shares
Beneficially               8        Shared Voting Power
  Owned By                                  442,643
    Each
  Reporting                9        Sole Dispositive Power
   Person                                    14,449
    With
                           10       Shared Dispositive Power
                                            442,643

11       Aggregate Amount Beneficially Owned by Each Reporting Person

                                            457,142 /1/

12       Check Box If the Aggregate Amount in Row (11) Excludes Certain
         Shares*                                            [ ]

13       Percent of Class Represented By Amount in Row (11)

                                    8.54%

14       Type of Reporting Person*

                  IA


____________________
/1/ Excludes certain shares. See Item 5.


                      *SEE INSTRUCTIONS BEFORE FILLING OUT!


<PAGE>


                                                              Page 7 of 79 Pages

                                  SCHEDULE 13D

CUSIP No. 096227103

1        Name of Reporting Person
         S.S. or I.R.S. Identification No. of Above Person

                  STANLEY F. DRUCKENMILLER (in the capacity described herein)

2        Check the Appropriate Box If a Member of a Group*
                                                     a.  [ ]
                                                     b.  [x]

3        SEC Use Only

4        Source of Funds*

                  AF

5        Check Box If Disclosure of Legal  Proceedings  Is Required  Pursuant to
         Items 2(d) or 2(e)             [ ]

6        Citizenship or Place of Organization

                  United States

                           7        Sole Voting Power
  Number of                                 0
   Shares
Beneficially               8        Shared Voting Power
  Owned By                                  442,643
    Each
  Reporting                9        Sole Dispositive Power
   Person                                   0
    With
                           10       Shared Dispositive Power
                                            442,643

11       Aggregate Amount Beneficially Owned by Each Reporting Person

                                            442,643 /1/

12       Check Box If the Aggregate Amount in Row (11) Excludes Certain
         Shares*                                             [x]

13       Percent of Class Represented By Amount in Row (11)

                                    8.29%

14       Type of Reporting Person*

                  IA

____________________
/1/ Excludes certain shares.  See Item 5


                      *SEE INSTRUCTIONS BEFORE FILLING OUT!


<PAGE>


                                                              Page 8 of 79 Pages

                  This  Statement  on  Schedule  13D relates to shares of Common
Stock,  $0.01  par value  per  share  (the  "Shares"),  of  Bluefly,  Inc.  (the
"Issuer").  This  Statement is being filed by the Reporting  Persons (as defined
herein)  to  report  the  recent   acquisition  of  securities  of  the  Issuer,
convertible  into  Shares,  as a result of which the  Reporting  Persons  may be
deemed to be the beneficial owners of more than 5% of the outstanding  Shares of
the Issuer.

Item 1.  Security and Issuer.

                  This  Statement  relates  to the  Shares.  The  address of the
principal  executive office of the Issuer is 42 West 39th Street, 9th Floor, New
York, New York 10018.

Item 2.  Identity and Background.

         This  Statement  is being  filed  on  behalf  of each of the  following
persons (collectively, the "Reporting Persons"):

         i)       Quantum Industrial Partners LDC ("QIP");

         ii)      QIH Management Investor, L.P. ("QIHMI");

         iii)     QIH Management, Inc. ("QIH Management");

         iv)      Soros Fund Management LLC ("SFM LLC");

         v)       Mr. George Soros ("Mr. Soros"); and

         vi)      Mr. Stanley F. Druckenmiller ("Mr. Druckenmiller").

         This  Statement  relates to the Shares held for the accounts of QIP and
SFM Domestic Investments LLC ("SFM Domestic Investments").

                              The Reporting Persons

QIP, QIHMI and QIH Management

                  QIP is a Cayman Islands exempted limited duration company with
its principal  address at Kaya  Flamboyan 9,  Willemstad,  Curacao,  Netherlands
Antilles.  The principal  business of QIP is investment in  securities.  Current
information concerning the identity and background of the directors and officers
of QIP is set forth in Annex A hereto,  which is  incorporated  by  reference in
response to this Item 2.

                  QIHMI,  an investment  advisory  firm  organized as a Delaware
limited partnership,  is a minority shareholder of, and (pursuant to constituent
documents  of QIP) is vested  with  investment  discretion  with  respect to the
portfolio  assets held for the account of, QIP. The principal  business of QIHMI
is to provide  management  and advisory  services to, and to invest in, QIP. QIH
Management,  a Delaware  corporation of which Mr. Soros is the sole shareholder,
is the sole general partner of QIHMI.  The principal  business of QIH Management
is to serve as the sole general partner of QIHMI. Current information concerning
the identity and backround of the  directors  and officers of QIH  Management is
set forth in Annex A hereto,  which is  incorporated by reference in response to
this Item 2.  QIHMI and QIH  Management  have  their  principal  offices  at 888
Seventh Avenue,  33rd Floor,  New York, New York 10106.  QIHMI, by reason of its
investment  discretion over the securities owned by QIP, and QIH Management,  as
the sole general  partner of QIHMI,  may each be deemed the beneficial  owner of
the Shares  held for the  account of QIP for  purposes  of Section  13(d) of the
Securities Exchange Act of 1934, as amended (the "Act").



<PAGE>


                                                              Page 9 of 79 Pages

                  Mr. Soros has entered into an agreement dated as of January 1,
1997 with SFM LLC pursuant to which Mr. Soros has, among other things, agreed to
use his best efforts to cause QIH  Management,  as the general partner of QIHMI,
to act at the direction of SFM LLC,  which  agreement to so act shall  terminate
upon the earlier of (a) the  assignment  to SFM LLC of the legal and  beneficial
ownership  interest in QIH  Management  and (b) the assignment to SFM LLC of the
general partnership interest in QIHMI (the "QIP Contract").


SFM LLC, Mr. Soros and Mr. Druckenmiller


                  The  business  of SFM  LLC is  managed  through  a  Management
Committee (the "Management Committee") comprised of Mr. Soros, Mr. Druckenmiller
and Mr. Gary Gladstein.  SFM LLC, a Delaware limited liability company,  has its
principal  office at 888 Seventh Avenue,  33rd Floor,  New York, New York 10106.
Its  principal  business is to serve,  pursuant to  contract,  as the  principal
investment manager to several foreign investment  companies (the "SFM Clients").
Mr.  Soros,  as  Chairman of SFM LLC,  has the ability to direct the  investment
decisions  of SFM LLC and as such may be  deemed to have  investment  discretion
over the securities held for the accounts of the SFM Clients. Mr. Druckenmiller,
as Lead  Portfolio  Manager of SFM LLC, has the ability to direct the investment
decisions  of SFM LLC and as such may be  deemed to have  investment  discretion
over the securities held for the accounts of the SFM Clients. Set forth in Annex
B hereto and incorporated by reference in response to this Item 2, and elsewhere
in this Schedule 13D as applicable,  is a list of the Managing  Directors of SFM
LLC.

                  The  principal  occupation  of  Mr.  Soros,  a  United  States
citizen,  is his direction of the activities of SFM LLC, which is carried out in
his capacity as Chairman of SFM LLC at SFM LLC's principal office.

                  The principal occupation of Mr. Druckenmiller, a United States
citizen,  is  his  position  as  Lead  Portfolio  Manager  and a  Member  of the
Management  Committee  of SFM LLC,  which is carried out at SFM LLC's  principal
office.

                  Pursuant to regulations promulgated under Section 13(d) of the
Act, SFM LLC, pursuant to the provisions of the QIP Contract,  Mr. Soros, in his
capacity as Chairman of SFM LLC, and Mr. Druckenmiller,  in his capacity as Lead
Portfolio  Manager  of SFM LLC,  each may be  deemed a  beneficial  owner of the
Shares held for the account of QIP.

                  Mr. Soros,  by virtue of his position as a managing  member of
SFM Domestic  Investments,  may also be deemed a beneficial  owner of the Shares
held for the account of SFM Domestic Investments.  SFM Domestic Investments is a
Delaware  limited  liability  company with its principal  address at 888 Seventh
Avenue,  33rd Floor,  New York,  New York 10106.  The principal  business of SFM
Domestic Investments is investment in securities.

                  During the past five years, none of the Reporting Persons and,
to the best of the Reporting Persons'  knowledge,  no other person identified in
response to this Item 2 has been (a) convicted in a criminal proceeding or (b) a
party to any civil  proceeding as a result of which it or he has been subject to
a judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, federal or state securities laws, or finding
any violation with respect to such laws.

Item 3.   Source and Amount of Funds or Other Consideration.

                  QIP expended  approximately  $4,647,760 of its working capital
to purchase  the  securities  reported  herein as being  acquired in the last 60
days. SFM Domestic  Investments expended  approximately  $152,240 of its working
capital to purchase the securities reported herein as being acquired in the last
60 days.


<PAGE>


                                                             Page 10 of 79 Pages


                  The  securities  held for the accounts of QIP and SFM Domestic
Investments may be held through margin accounts  maintained with brokers,  which
extend margin  credit as and when  required to open or carry  positions in their
margin  accounts,  subject  to  applicable  federal  margin  regulations,  stock
exchange rules and such firms' credit policies.  The positions which may be held
in the margin accounts, including the Shares, are pledged as collateral security
for the repayment of debit balances in the respective accounts.

Item 4.  Purpose of Transaction.

                  All of the securities  reported herein as having been acquired
for or disposed of from the accounts of QIP and/or SFM Domestic Investments were
acquired or disposed of for investment  purposes.  Neither the Reporting Persons
nor, to the best of their  knowledge,  any of the other  persons  identified  in
response to Item 2, has any plans or proposals that relate to or would result in
any of the transactions  described in subparagraphs (a) through (j) of Item 4 of
Schedule 13D.

                  The Reporting  Persons reserve the right to acquire,  or cause
to be acquired,  additional securities of the Issuer, to dispose of, or cause to
be disposed,  such securities at any time or to formulate other purposes,  plans
or proposals regarding the Issuer or any of its securities, to the extent deemed
advisable in light of general  investment and trading  policies of the Reporting
Persons, market conditions or other factors.

Item 5.  Interest in Securities of the Issuer.

                           (a)      (i)     Each of QIP, QIHMI,  QIH Management,
SFM LLC and Mr.  Druckenmiller may be deemed the beneficial owner of the 442,643
Shares  (approximately  8.29% of the  total  number  of  Shares  which  would be
outstanding) assuming the conversion of all of the Series A Preferred Shares (as
defined herein) held for the account of QIP. This number includes 442,643 Shares
issuable  upon  conversion  of 232,388  Series A  Preferred  Shares held for the
account of QIP.

                                    (ii)    Mr.   Soros   may  be   deemed   the
beneficial owner of 457,142 Shares  (approximately 8.54 % of the total number of
Shares which would be outstanding assuming the conversion of all of the Series A
Preferred  Shares held for the  accounts of QIP and SFM  Domestic  Investments).
This number  includes (A) 442,643  Shares  issuable  upon  conversion of 232,388
Series A  Preferred  Shares  held for the  account of QIP and (B) 14,499  Shares
issuable upon conversion of 7,612 Series A Preferred Shares held for the account
of SFM Domestic Investments.

                           (b)      (i)     Each of QIP,  QIHMI,  QIH Management
and SFM LLC (by virtue of the QIP contract) may be deemed to have the sole power
to direct the voting and  disposition of the 442,643 Shares held for the account
of QIP (assuming the conversion of all of the Series A Preferred Shares held for
the account of QIP).

                                    (ii)    Mr. Soros and Mr. Druckenmiller as a
result of their positions with SFM LLC may be deemed to have the shared power to
direct the voting and  disposition of the 442,643 Shares held for the account of
QIP  (assuming the  conversion of all of the Series A Preferred  Shares held for
the account of QIP).

                                    (iii)   Mr.  Soros  in  his  capacity  as  a
managing member of SFM Domestic Investments may be deemed to have the sole power
to direct the voting and  disposition  of the 14,499 Shares held for the account
of SFM Domestic  Investments  (assuming  the  conversion  of all of the Series A
Preferred Shares held for the account of SFM Domestic Investments).

                           (c)      Except for the transactions  listed on Annex
C hereto,  there have been no  transactions  effected with respect to the Shares
since June 7, 1999 (60 days prior to the date hereof) by any of


<PAGE>


                                                             Page 11 of 79 Pages

the Reporting Persons.

                           (d)      (i)     The  shareholders of QIP,  including
Quantum  Industrial  Holdings,  Ltd.,  a British  Virgin  Islands  international
business  company,  have the right to  participate  in the receipt of  dividends
from,  or  proceeds  from the sale of, the Shares held for the account of QIP in
accordance with their ownership interests in QIP.

                                    (ii)    Certain   members  of  SFM  Domestic
Investments  have the right to participate in the receipt of dividends  from, or
proceeds  from the sale of, the  Shares  held for the  account  of SFM  Domestic
Investments.

                           (e)      Not applicable.

                  In addition,  pursuant to the Investment Agreement (as defined
herein) QIP and SFM Domestic Investments have the obligation, to the extent that
the  shares  are not  purchased  by third  parties,  to  purchase  up to 250,000
additional  Series A Preferred Shares (as defined herein) for an aggregate price
of $5,000,000 on August 24, 1999. Such shares, if acquired, would be convertible
into 476,190 additional Shares.

Item 6.  Contracts,  Arrangements,  Understandings or Relationships with Respect
         to Securities of the Issuer.

                  On July 27,  1999,  each of QIP and SFM  Domestic  Investments
entered into an  Investment  Agreement  (the  "Investment  Agreement")  with the
Issuer (a copy of which is attached hereto as Exhibit E and incorporated  herein
by  reference  in response to this Item 6) pursuant to which they  purchased  an
aggregate of 240,000 shares of Series A Convertible  Preferred  Stock ("Series A
Preferred Shares").

                  Pursuant  to Section  2.3 and  Section  2.4 of the  Investment
Agreement,  QIP and SFM Domestic Investments have the obligation,  to the extent
that such shares are not purchased by third  parties,  to purchase up to 250,000
additional  Series A Preferred  Shares for an aggregate  price of  $5,000,000 on
August 24, 1999.

                  Pursuant to Section 9.2 of the Investment  Agreement,  QIP and
SFM Domestic  Investments  were granted certain rights relating to their ability
to demand that the Issuer register under the Securities Act of 1933 unregistered
securities of the Issuer held by QIP or SFM Domestic Investments.

                  Pursuant to Section 9.3 of the Investment  Agreement,  QIP and
SFM Domestic  Investments were granted certain piggy-back  registration  rights,
which, if exercised,  entitle QIP and SFM Domestic Investments to participate in
registered offerings by the Issuer.

                  Pursuant  to  Section  9.4 of the  Investment  Agreement,  the
Issuer,  QIP and SFM Domestic  Investments  agreed to certain  holdback  rights,
which, if exercised, permit each of the Issuer, QIP and SFM Domestic Investments
to curtail a public sale of securities of the Issuer for a period of time.

                  Pursuant to Section 9.5(b) of the Investment  Agreement,  each
of QIP and SFM Domestic Investments will be required to discontinue  disposition
of the  Issuer's  securities  upon  receiving  notice  from the Issuer  that the
Issuer's  prospectus contains an untrue statement of a material fact or omits to
state a material fact required to be stated therein.

                  The foregoing description of the Investment Agreement does not
purport to be complete  and is  qualified  in its  entirety by  reference to the
Investment Agreement (attached as Exhibit E to this Initial Statement), which is
incorporated herein by reference.


<PAGE>


                                                             Page 12 of 79 Pages


                  The  Issuer   executed  a  Certificate  of  Amendment  of  the
Certificate of Incorporation  (the  "Certificate of Amendment") (a copy of which
is attached hereto as Exhibit F and incorporated herein by reference in response
to this Item 6) on July 27, 1999.

                  Pursuant to Section 5(a) of the Certificate of Amendment,  the
Issuer may take  certain  actions  only with the  approval  of a majority of the
directors,  which must include the Class A Director  (as defined  herein) to the
extent that the holders of the Series A Preferred Shares are entitled to appoint
a Class A Director.

                  Pursuant to Section 5(c) of the  Certificate of Amendment,  so
long  as the  Purchasers  (as  defined  in the  Investment  Agreement)  maintain
beneficial  ownership  of at least 50% of the  Series A  Preferred  Shares,  the
holders of Series A Preferred Shares, voting separately as a class, are entitled
to elect one director to the Board of Directors (the "Class A Director")  upon a
vote of a majority of the outstanding Series A Preferred Shares.

                  Pursuant to Section 7 of the Certificate of Amendment,  upon a
change in  control  of the Issuer  that will  result in the  holders of Series A
Preferred Shares receiving cash or marketable securities with an aggregate value
less than a certain  amount,  the holders of Series A Preferred  Shares have the
right to require  the Issuer to redeem or  repurchase  their  Series A Preferred
Shares for a certain amount.

                  Pursuant to Section 8(b) of the Certificate of Amendment,  the
holders of Series A Preferred Shares have certain preemptive rights in instances
where the Issuer issues any Shares or other securities convertible into Shares.

                  The foregoing description of the Certificate of Amendment does
not purport to be complete  and is qualified in its entirety by reference to the
Certificate  of Amendment  (attached  as Exhibit F to this  Initial  Statement),
which is incorporated herein by reference.

                  From  time to time,  each of the  Reporting  Persons  may lend
portfolio securities to brokers,  banks or other financial  institutions.  These
loans  typically  obligate  the borrower to return the  securities,  or an equal
amount of securities of the same class, to the lender and typically provide that
the  borrower  is entitled to  exercise  voting  rights and to retain  dividends
during  the term of the loan.  From time to time,  to the  extent  permitted  by
applicable laws, each of the Reporting Persons may borrow securities,  including
the  Shares,  for  the  purpose  of  effecting,   and  may  effect,  short  sale
transactions,  and may purchase  securities for the purpose of closing out short
positions in such securities.

                  Except as described above,  the Reporting  Persons do not have
any contracts, arrangements, understandings or relationships with respect to any
securities of the Issuer.


Item 7.  Material to be Filed as Exhibits.

                  A. Power of Attorney dated as of January 1,1997 granted by Mr.
Soros in favor of Mr. Sean C. Warren and Mr. Michael C. Neus.

                  B. Power of  Attorney  dated as of January 1, 1997  granted by
Mr. Druckenmiller in favor of Mr. Sean C. Warren and Mr. Michael C. Neus.

                  C. Joint  Filing  Agreement  dated August 6, 1999 by and among
QIP, QIHMI, QIH Management, SFM LLC, Mr. Soros and Mr. Druckenmiller.

                  D. Power of Attorney dated May 23,1996 granted by QIP in favor
of Mr. Gary Gladstein, Mr. Sean Warren and Mr. Michael Neus.


<PAGE>


                                                             Page 13 of 79 Pages



                  E. Investment  Agreement dated July 27, 1999 among the Issuer,
QIP, SFM Domestic Investments and Pilot Capital Corp.

                  F. Certificate of Amendment of the Issuer dated July 27, 1999.





<PAGE>


                                                             Page 14 of 79 Pages


                                   SIGNATURES

         After  reasonable  inquiry and to the best of my knowledge  and belief,
the  undersigned  certifies that the  information set forth in this Statement is
true, complete and correct.

Date: August 6, 1999

                                   QUANTUM INDUSTRIAL PARTNERS LDC


                                   By:  /S/ MICHAEL C. NEUS
                                        ----------------------------------------
                                        Michael C. Neus
                                        Attorney-in-Fact


                                   QIH MANAGEMENT INVESTOR, L.P.

                                   By:  QIH Management, Inc.,
                                        its General Partner


                                        By:  /S/ MICHAEL C. NEUS
                                             -----------------------------------
                                             Michael C. Neus
                                             Vice President


                                   QIH MANAGEMENT, INC.


                                   By:  /S/ MICHAEL C. NEUS
                                        ----------------------------------------
                                        Michael C. Neus
                                        Vice President


                                   SOROS FUND MANAGEMENT LLC


                                   By:  /S/ MICHAEL C. NEUS
                                        ----------------------------------------
                                        Michael C. Neus
                                        Assistant General Counsel


                                   GEORGE SOROS


                                   By:  /S/ MICHAEL C. NEUS
                                        ----------------------------------------
                                        Michael C. Neus
                                        Attorney-in-Fact





<PAGE>


                                                             Page 15 of 79 Pages



                                    STANLEY F. DRUCKENMILLER


                                   By:  /S/ MICHAEL C. NEUS
                                        ----------------------------------------
                                        Michael C. Neus
                                        Attorney-in-Fact



<PAGE>


                                                             Page 16 of 79 Pages


                                     ANNEX A

            Directors and Officers of Quantum Industrial Partners LDC

Name/Title/Citizenship      Principal Occupation          Business Address
----------------------      --------------------          ----------------


Curacao Corporation         Managing Director of          Kaya Flamboyan 9
Company N.V.                Netherlands Antilles          Willemstad
  Managing Director         corporations                  Curacao,
  (Netherlands Antilles)                                  Netherlands Antilles



Inter Caribbean             Administrative services       Citco Building
Services Limited                                          Wickhams Cay
  Secretary                                               Road Town
  (British Virgin Islands)                                Tortola
                                                          British Virgin Islands



                 Directors and Officers of QIH Management, Inc.

Name/Title/Citizenship      Principal Occupation          Business Address
----------------------      --------------------          ----------------

Gary Gladstein              Managing Director of SFM      888 Seventh Avenue
Director and President      LLC                           33rd Floor
(United States)                                           New York, NY  10106

Sean C. Warren              Managing Director of SFM      888 Seventh Avenue
Director, Vice President    LLC                           33rd Floor
and Secretary                                             New York, NY  10106
(United States)

Peter Streinger             Chief Financial Officer of    888 Seventh Avenue
Treasurer                   SFM LLC                       33rd Floor
(United States)                                           New York, NY  10106

Michael C. Neus             Assistant General Counsel of  888 Seventh Avenue
Vice President and          SFM LLC                       33rd Floor
Assistant Secretary                                       New York, NY  10106
(United States)






         To the best of the Reporting Persons' knowledge /1/:

                  (a) None of the above persons hold any Shares. /1/

                  (b) None of the above persons has any contracts, arrangements,
understandings or relationships with respect to the Shares. /1/

____________________
/1/ Certain persons may have an interest in SFM Domestic Investments.


<PAGE>


                                                             Page 17 of 79 Pages


                                     ANNEX B


                  The  following  is a list of all of the  persons  (other  than
Stanley Druckenmiller) who serve as Managing Directors of SFM LLC. /1/


Scott K. H. Bessent
Walter Burlock
Brian J. Corvese
L. Kevin Dann
Gary Gladstein
Ron Hiram
Robert K. Jermain
Sheldon Kasowitz
David N. Kowitz
Carson Levit
Alexander C. McAree
Paul McNulty
Steven Okin
Frank Sica
Sean C. Warren

         Each of the  above-listed  persons  is a United  States  citizen  whose
principal  occupation is serving as Managing Director of SFM LLC, and each has a
business address c/o Soros Fund Management LLC, 888 Seventh Avenue,  33rd Floor,
New York, New York 10106.

         To the best of the Reporting Persons' knowledge:

                  (a) None of the above persons hold any Shares. /1/

                  (b) None of the above persons has any contracts, arrangements,
understandings or relationships with respect to the Shares. /1/












____________________
/1/ Certain persons may have an interest in SFM Domestic Investments.


<PAGE>


                                                             Page 18 of 79 Pages


<TABLE>
<CAPTION>

                                     ANNEX C

                    RECENT TRANSACTIONS IN THE SECURITIES OF
                                  BLUEFLY, INC.

<S>                         <C>            <C>            <C>            <C>

                              Date of       Nature of      Number of
For the Account of          Transaction    Transaction    Securities     Price
------------------          -----------    -----------    ----------     -----
QIP                         7/27/99        PURCHASE       232,388/1/       /2/

SFM Domestic Investments    7/27/99        PURCHASE         7,612/1/       /3/



</TABLE>

____________________
/1/ Shares of Series A Preferred Stock.
/2/ Total consideration  of $4,647,760 was paid for  the securities purchased by
    QIP.
/3/ Total consideration of $152,240 was paid for the securities purchased by SFM
    Domestic Investments.


<PAGE>


                                                             Page 19 of 79 Pages

                                  EXHIBIT INDEX

                                                                        Page No.
                                                                        --------


A.       Power of Attorney dated as of January 1, 1997 granted by
         Mr.  George Soros in favor of Mr. Sean C. Warren and Mr.
         Michael C. Neus.........................................             20

B.       Power of Attorney dated as of January 1, 1997 granted by
         Mr.  Stanley F.  Druckenmiller  in favor of Mr.  Sean C.
         Warren and Mr. Michael C. Neus..........................             21

C.       Joint Filing Agreement dated August 6, 1999 by and among
         Quantum   Industrial   Partners   LDC,  QIH   Management
         Investor,   L.P.,  QIH  Management,   Inc.,  Soros  Fund
         Management  LLC,  Mr.  George  Soros and Mr.  Stanley F.
         Druckenmiller...........................................             22

D.       Power of Attorney  dated May 23, 1996 granted by Quantum
         Industrial  Partners LDC in favor of Mr. Gary Gladstein,
         Mr. Sean Warren and Mr. Michael Neus....................             24

E.       Investment  Agreement  dated July 27,  1999 by and among
         Bluefly,  Inc.,  Quantum  Industrial  Partners  LDC, SFM
         Domestic Investments LLC and Pilot Capital Corp.........             25

F.       Certificate   of   Amendment  of  the   Certificate   of
         Incorporation of Bluefly, Inc. dated July 27, 1999......             67




