                                                                    Exhibit 99.1

FOR IMMEDIATE RELEASE

                               Investor Contacts:          Press Contacts:
                               Pat Barry                   Curtis Hougland
                               CFO, Bluefly, Inc.          RLMpr
                               212- 944-8000 ext. 239      212-741-5106 ext. 220
                               pat@bluefly.com             curtis@RLMpr.com

               BLUEFLY RAISES OVER $7 MILLION IN PRIVATE PLACEMENT

New York, NY, June 27, 2005 - Bluefly, Inc. (NASDAQ SmallCap: BFLY), a leading
online retailer of designer brands, fashion trends and superior value
(www.bluefly.com), announced today that it raised slightly over $7 million in
gross proceeds in a private placement. The company plans to use a majority of
the capital to fund an intensive customer acquisition marketing campaign.

"Over the past eighteen months, Bluefly has achieved impressive growth by
revamping our merchandising strategy and re-setting our margin structure," said
Melissa Payner-Gregor, Bluefly's CEO and President. "As a result of this
success, Bluefly now has the opportunity to accelerate growth by launching a
full scale marketing campaign. Having recently completed a comprehensive
customer and prospect analysis, we are poised to use the capital infusion to
focus firmly on customer acquisition."

The transaction was arranged by HPC Capital Management LLC of Atlanta and
New York, and the investment group participating in the transaction was led by
private equity firm Palisades Master Fund. Eight other private equity funds,
including two funds affiliated with Soros Fund Management LLC - the company's
majority shareholders - also purchased a portion of the new securities. In
connection with the transaction, the new investors also purchased shares of the
Soros funds' Series D preferred stock in the Company with an aggregate
liquidation preference and accrued dividends of $3 million. The new investors
paid the Soros funds $3 million for the Series D preferred stock.

Under the terms of the deal, Bluefly issued $7 million of preferred stock. The
preferred stock is convertible into common stock at $2.32 per share, which
represents approximately a 5% premium to market at the time the deal was signed.
Bluefly also sold the non-Soros investors warrants to purchase approximately
600,000 shares of common stock at any time during the next three years at an
exercise price equal to $2.87 per share. The company received $7 million for the
preferred stock, and an additional $75,000 for the warrants.

Assuming all outstanding equity securities, stock options and warrants of the
company were converted, the stock and warrants issued in this deal would equal
approximately 4.9% of Bluefly's equity, and, following the deal, the Soros funds
ownership would decrease from approximately 71% to approximately 65% of the
company's total equity. The Company has agreed to file a registration statement
with the Securities and Exchange Commission on behalf of the investors as soon
as is practicable, in order to register the common stock underlying the
preferred stock and the warrants.

The securities sold in the private placement have not been registered under the
Securities Act of 1933, as amended (the "Securities Act"), and may not be
offered or sold in the United States unless registered under the Securities Act
or an applicable exemption from registration is available. This press release
does not constitute an offer to sell or the solicitation of an offer to buy, nor
shall there be any sale of these securities in any state in which such offer,
solicitation or sale would be unlawful prior to the registration or
qualification under the securities laws of any such state.

ABOUT BLUEFLY, INC.

Founded in 1998, Bluefly, Inc. (NASDAQ SmallCap: BFLY) is a leading online
retailer of designer brands, fashion trends and superior value. Bluefly is
headquartered at 42 West 39th Street in New York City, in the heart of the
Fashion District. For more information, please call 212-944-8000 or visit
www.bluefly.com.

   This press release may include statements that constitute "forward-looking
   statements," usually containing the words "believe," "project," "expect" or
   similar expressions. These statements are made pursuant to the safe harbor
       provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements inherently involve risks and uncertainties that could
 cause actual results to differ materially from the forward-looking

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    statements. The risks and uncertainties are detailed from time to time in
    reports filed by the company with the Securities and Exchange Commission,
 including Forms 8-K, 10-Q and 10-K. These risks and uncertainties include, but
  are not limited to, the company's ability to execute on, and gain additional
  revenue from, its marketing initiatives; the company's history of losses and
 anticipated future losses; need for additional capital and potential inability
to raise such capital; the potential failure to forecast revenues and/or to make
adjustments to operating plans necessary as a result of any failure to forecast
  accurately; unexpected changes in fashion trends; cyclical variations in the
   apparel and e-commerce market; the availability of merchandise; the need to
  further establish brand name recognition; management of potential growth; and
 risks associated with our ability to handle increased traffic and/or continued
                          improvements to its Web site.
