UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                 AMENDMENT NO. 2

                                       on

                                   FORM 8-K/A




                                 CURRENT REPORT



                     Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934


        Date of Report (Date of Earliest Event Reported): January 6, 2004


                                    XOMA LTD.
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             (Exact name of registrant as specified in its charter)


                                     BERMUDA
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                 (State or other jurisdiction of incorporation)


              0-14710                                      52-2154066
     (Commission File Number)              (IRS Employer Identification No.)

2910 Seventh Street, Berkeley, California                        94710
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(Address of principal executive offices)                       (Zip code)

Registrant's telephone number, including area code           (510) 204-7200



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          (Former name or former address, if changed since last report)





Item 5. Other Events

     As announced on January 6, 2004, XOMA Ltd. and Diversa Corporation have
entered into a licensing and product development agreement.

     A copy of the licensing and product development agreement is attached
hereto as Exhibit 2 and is incorporated herein by reference.

Item 7.  Exhibits

1.   Press Release dated January 6, 2004.*

2.   License Agreement, dated as of December 29, 2003, by and between Diversa
     Corporation and XOMA Ireland Limited (with certain confidential information
     omitted, which omitted information is the subject of a confidential
     treatment request and has been filed separately with the Securities and
     Exchange Commission).

___________________

*    Previously filed.






                                      -2-

                                    SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

Dated:  March 19, 2004                 XOMA LTD.




                                       By:  /s/  Christopher J. Margolin
                                            --------------------------------
                                            Christopher J. Margolin
                                            Vice President, General
                                            Counsel and Secretary








                                  EXHIBIT INDEX


Number   Description
------   -----------

1.   Press Release dated January 6, 2004. *

2.   License Agreement, dated as of December 29, 2003, by and between Diversa
     Corporation and XOMA Ireland Limited (with certain confidential information
     omitted, which omitted information is the subject of a confidential
     treatment request and has been filed separately with the Securities and
     Exchange Commission).

___________________

*    Previously filed.