<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0202</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2007-07-05</periodOfReport>

    <notSubjectToSection16>0</notSubjectToSection16>

    <issuer>
        <issuerCik>0000833795</issuerCik>
        <issuerName>HOMEFED CORP</issuerName>
        <issuerTradingSymbol>HOFD</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001251284</rptOwnerCik>
            <rptOwnerName>LOBATZ MICHAEL A</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>1903 WRIGHT PLACE STE 220</rptOwnerStreet1>
            <rptOwnerStreet2></rptOwnerStreet2>
            <rptOwnerCity>CARLSBAD</rptOwnerCity>
            <rptOwnerState>CA</rptOwnerState>
            <rptOwnerZipCode>92008</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>1</isDirector>
            <isOfficer>0</isOfficer>
            <isTenPercentOwner>0</isTenPercentOwner>
            <isOther>0</isOther>
        </reportingOwnerRelationship>
    </reportingOwner>

    <nonDerivativeTable>
        <nonDerivativeTransaction>
            <securityTitle>
                <value>Common Stock, Par Value $.01</value>
            </securityTitle>
            <transactionDate>
                <value>2007-07-05</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>M</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>100</value>
                </transactionShares>
                <transactionPricePerShare>
                    <value>9.50</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>1300</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </nonDerivativeTransaction>
    </nonDerivativeTable>

    <derivativeTable>
        <derivativeTransaction>
            <securityTitle>
                <value>Stock Options (Right to Buy)</value>
            </securityTitle>
            <conversionOrExercisePrice>
                <value>9.50</value>
            </conversionOrExercisePrice>
            <transactionDate>
                <value>2007-07-05</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>M</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>100</value>
                </transactionShares>
                <transactionPricePerShare>
                    <footnoteId id="F2"/>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>D</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <exerciseDate>
                <footnoteId id="F1"/>
            </exerciseDate>
            <expirationDate>
                <value>2007-07-10</value>
            </expirationDate>
            <underlyingSecurity>
                <underlyingSecurityTitle>
                    <value>Common Stock</value>
                </underlyingSecurityTitle>
                <underlyingSecurityShares>
                    <value>100</value>
                </underlyingSecurityShares>
            </underlyingSecurity>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>0</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </derivativeTransaction>
    </derivativeTable>

    <footnotes>
        <footnote id="F1">The stock options were granted on July 10, 2002.  Pursuant to their terms these options became exercisable at the rate of 25%
 per year commencing one year after the grant date.</footnote>
        <footnote id="F2">Not applicable.</footnote>
    </footnotes>

    <ownerSignature>
        <signatureName>/s/ Michael A. Lobatz</signatureName>
        <signatureDate>2007-07-05</signatureDate>
    </ownerSignature>
</ownershipDocument>
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X0202
4
2007-07-05
0
0000833795
HOMEFED CORP
HOFD
0001251284
LOBATZ MICHAEL A
1903 WRIGHT PLACE STE 220
CARLSBAD
CA
92008
1
0
0
0
Common Stock, Par Value $.01
2007-07-05
4
M
0
100
9.50
A
1300
D
Stock Options (Right to Buy)
9.50
2007-07-05
4
M
0
100
D
2007-07-10
Common Stock
100
0
D
The stock options were granted on July 10, 2002.  Pursuant to their terms these options became exercisable at the rate of 25%
 per year commencing one year after the grant date.
Not applicable.
/s/ Michael A. Lobatz
2007-07-05