FORM 3

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 INITIAL STATEMENT OF BENEFICIAL OWNERSHIP OF SECURITIES Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940

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(Print or Type Responses)

1. Name and Address of Reporting Person *   GASTON DWIGHT 2. Date of Event Requiring Statement (Month/Day/Year) 09/01/2005 3. Issuer Name and Ticker or Trading Symbol BLUE NILE INC [NILE] (Last) (First) (Middle) C/O BLUE NILE, INC., 705 FIFTH AVENUE S, STE 900 4. Relationship of Reporting Person(s) to Issuer (Check all applicable) _____ Director _____ 10% Owner __X__ Officer (give title below) _____ Other (specify below) Senior VP 5. If Amendment, Date Original Filed(Month/Day/Year) (Street) SEATTLE, WA 98104 6. Individual or Joint/Group Filing(Check Applicable Line) _X_ Form filed by One Reporting Person ___ Form filed by More than One Reporting Person (City) (State) (Zip) Table I - Non-Derivative Securities Beneficially Owned

1.Title of Security (Instr. 4) 2. Amount of Securities Beneficially Owned (Instr. 4) 3. Ownership Form: Direct (D) or Indirect (I) (Instr. 5) 4. Nature of Indirect Beneficial Ownership (Instr. 5) Common Stock 22,800 D   Common Stock 2,691 I By Wife

Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.			SEC 1473 (7-02)
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Table II - Derivative Securities Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)

1. Title of Derivative Security (Instr. 4)	2. Date Exercisable and Expiration Date (Month/Day/Year)		3. Title and Amount of Securities Underlying Derivative Security (Instr. 4)		4. Conversion or Exercise Price of Derivative Security	5. Ownership Form of Derivative Security: Direct (D) or Indirect (I) (Instr. 5)	6. Nature of Indirect Beneficial Ownership (Instr. 5)
	Date Exercisable	Expiration Date	Title	Amount or Number of Shares
Option (right to buy)	07/15/2001(1)	02/24/2012	Common Stock	1,600	$ 0.25	D	Â
Option (right to buy)	02/21/2006(2)	07/26/2014	Common Stock	18,000	$ 30	D	Â
Option (right to buy)	05/17/2000(3)	06/25/2009	Common Stock	22,500	$ 0.5	D	Â
Option (right to buy)	08/26/2002(4)	02/24/2012	Common Stock	9,600	$ 0.25	D	Â
Option (right to buy)	08/26/2003(5)	10/14/2012	Common Stock	4,800	$ 0.25	D	Â
Option (right to buy)	08/26/2004(6)	10/08/2013	Common Stock	27,200	$ 8.75	D	Â

Reporting Owners

Reporting Owner Name / Address	Relationships
	Director	10% Owner	Officer	Other
GASTON DWIGHT C/O BLUE NILE, INC. 705 FIFTH AVENUE S, STE 900 SEATTLE, WA 98104	Â	Â	  Senior VP	Â

Signatures

/s/ Dwight Gaston		09/09/2005
**Signature of Reporting Person		Date

Explanation of Responses:

*	If the form is filed by more than one reporting person, see Instruction 5(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).
(1)	25% of the option shares vest one year after July 15, 2000 and one-forty-eighth of the option shares vest in equal monthly installments over the following thirty-six months.
(2)	25% of the option shares vest one year after February 21, 2005 and one-forty-eighth of the option shares vest in equal monthly installments over the following thirty-six months.
(3)	25% of the option shares vest one year after May 17, 1999 and one-forty-eighth of the option shares vest in equal monthly installments over the following thirty-six months.
(4)	25% of the option shares vest one year after August 26, 2001 and one-forty-eighth of the option shares vest in equal monthly installments over the following thirty-six months.
(5)	25% of the option shares vest one year after August 26, 2002 and one-forty-eighth of the option shares vest in equal monthly installments over the following thirty-six months.
(6)	25% of the option shares vest one year after August 26, 2003 and one-forty-eighth of the option shares vest in equal monthly installments over the following thirty-six months.

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