SEC Form 5

FORM 5		UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ANNUAL STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934 or Section 30(h) of the Investment Company Act of 1940	OMB APPROVAL OMB Number: 3235-0362 Estimated average burden hours per response: 1.0
	Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).
	Form 3 Holdings Reported.
	Form 4 Transactions Reported.

1. Name and Address of Reporting Person* MACDONALD MICHAEL C (Last) (First) (Middle) 800 LONG RIDGE ROAD P. O. BOX 1600 (Street) STAMFORD CT 06904 (City) (State) (Zip)	2. Issuer Name and Ticker or Trading Symbol XEROX CORP [ XRX ]	5. Relationship of Reporting Person(s) to Issuer (Check all applicable) Director 10% Owner X Officer (give title below) Other (specify below) Senior Vice President
	3. Statement for Issuer's Fiscal Year Ended (Month/Day/Year) 12/31/2005
	4. If Amendment, Date of 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

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 at end of Issuer's Fiscal Year (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
				Amount	(A) or (D)	Price
Common Stock							58,307	D
Common Stock							4,228.78	I	Employee Stock Ownership Plan
Common Stock							45	I	Children
Incentive Stock Rights							55,000	D
Xerox Stock Fund	02/28/2005		J(3)	141.21	A	$0(1)	10,659.39	I	Xerox Stock Fund
Xerox Stock Fund	04/30/2005		J(3)	656.2	A	$0(1)	11,315.59	I	Xerox Stock Fund
Xerox Stock Fund	05/31/2005		C(3)	311.18	A	$0(1)	11,626.77	I	Xerox Stock Fund(3)

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 Securities Underlying Derivative Security (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: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
					(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares
Stock Option	$5.14						10/14/2007	12/31/2011	Common Stock	50,000		50,000	D
Stock Option	$7.885						01/01/2004(2)	12/31/2012	Common Stock	149,600		149,600	D
Stock Option	$10.365						01/01/2003(2)	12/31/2011	Common Stock	93,500		93,500	D
Stock Option	$21.7812						01/01/2005(2)	12/31/2009	Common Stock	30,000		30,000	D
Stock Option	$46.875						01/01/1999(2)	12/31/2008	Common Stock	17,166		17,166	D
Stock Option	$47.5						03/01/2003	12/31/2009	Common Stock	6,282		6,282	D
Stock Option	$59.4375						01/01/2000(2)	12/31/2006	Common Stock	1,184		1,184	D
Deferred Comp	$0.00(1)						08/08/1988(1)	08/08/1988(1)	Common Stock	$58,628		$58,628	D
Stock Option	$13.685						01/01/2005(2)	12/31/2011	Common Stock	77,000		77,000	D
Stock Option	$15.205						01/01/2005(2)	12/31/2011	Common Stock	15,000		15,000	D

Explanation of Responses:

1. Not Applicable

2. Options vest over three years, 33.3% per year beginning in year shown.

3. Units purchased in Xerox Stock Fund under Xerox Savings Plan. Amount does not represent shares of stock, but dollars invested divided by unit value.

	K.W. Fizer, Attorney-In-Fact	01/31/2006
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* 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).
Note: File three copies of this Form, one of which must be manually signed. If space is insufficient, see Instruction 6 for procedure.
Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB Number.

9149250145	p.2
M~i 21 03 03:33p	MacDonald
POWER OF ATTORNEY

The undersigned hereby constitutes and appoints each of J. M. Farren, K. W. Fizer and S. K. Lee,
as the undersigned's true and lawful attorney's-in-fact, with full powers to act alone, to execute
and file with the Securities and Exchange Commission and any stock exchange or similar authority one
or more beneficial ownership reports and any and all amendments thereto, together with any and all
exhibits relating thereto including this Power of Attorney, in the name and on behalf of the undersigned,
disclosing the undersigned's beneficial ownership of securities of Xerox Corporation, in connection with
Section 16 and any other provisions of the Securities Exchange Act of 1934, as amended, and the rules
promulgated thereunder (the "SEC Rules"), which reports, amendments and exhibits shall contain such
information as any of J. Michael Farren, K. W. Fizer, and S. K. Lee deems appropriate.  The undersigned
hereby grants to each such Attorney-in-fact full power and authority to do and perform each and every act
and thing whatsoever that said attorney or attorneys may deem necessary or advisable to carry out fully the
intent of the foregoing  as the undersigned might or could do personally.  The undersigned acknowledges that
none of the foregoing attorneys-in-fact, in serving in such capacity, which the undersigned acknowledges is
at the request of the undersigned, is assuming, nor is Xerox Corporation assuming, any of the undersigned's
responsibilities to comply with the SEC Rules.  This power of attorney shall remain in full force and effect
with respect to each of the foregoing attorneys-in-fact until the undersigned is no longer required to file
any of the aforementioned reports under the SEC Rules, unless earlier revoked by the undersigned in a signed
writing delivered to the applicable attorney-in-fact.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as of the
18th day of July, 2005.
/s/Michael C. MacDonald