diff --git a/ChangeLog b/ChangeLog
index edc76bca15..78a2d9ef58 100644
--- a/ChangeLog
+++ b/ChangeLog
@@ -1,3 +1,8 @@
+2000-12-11  John Levon  <moz@compsoc.man.ac.uk>
+
+	* README: add mention of broken ghostscript versions, remove
+	reference to non-existent BUGS file
+
 2000-12-11  Jean-Marc Lasgouttes  <Jean-Marc.Lasgouttes@inria.fr>
 
 	* forms/sp_form.fd:
diff --git a/README b/README
index b0a02db146..d316f02aba 100644
--- a/README
+++ b/README
@@ -69,6 +69,9 @@ What do I need to run LyX?
 	A decent LaTeX2e installation (e.g. teTeX or NTeX) not older
 	   than 1995/12/01
 	Optionally ghostscript and ghostview (or compatible)
+		- note that ghostscript versions 6.22 through 6.50 
+		  won't render inline figures in LyX. This is due to
+		  a ghostscript bug.
 	Perl5.002 or later to import LaTeX files into LyX
 
 What's new?
@@ -188,8 +191,6 @@ How do I submit a bug report?
 	Help menu.  You'll find detailed info on submitting bug reports
 	there.
 
-	You should also check the BUGS file in this directory.
-
 	If you can't do that, send details to the LyX Developers mailing
 	list.  Don't forget to mention which version you are having
 	problems with!