Disposal

Telefonica SA
29 September 2000


TELEFONICA, S.A., in accordance with that stated in article 82 of the Spanish
Stock Market Law and that set forth in the Circular Letter 14/1998 of December
28th, hereby informs the Spanish Securities Commission of the following:

                         SIGNIFICANT EVENT

Telefonica, S.A. has sold a share stake of its subsidiary Telefonica Publicidad
e Informacion, S.A. representing 3.1% of the latter's share capital, at a market
price of 9.60 euros including commissions, in accordance with the resolution
undertaken by the Board of Directors of Telefonica, S.A. at its meeting held on
August 30th, 2000 and announced to the Spanish Securities Commission by way of
the corresponding Significant Event.

This operation finalises the process initiated by Telefonica, S.A. by which
Telefonica Publicidad e Informacion, S.A. will sustain its weight on the IBEX 35
index at 100% of its stock market capitalisation.

'Telefonica, S.A.' is, as always, at the entire disposal of the Spanish
Securities Commission to provide it with any further information it should need.

Madrid, September 29th, 2000