The mytable is closed because you're openning mytable2 in the same work area as mytable. Add 'IN 0' clause to the USE command to open table in the first available work area.
USE c:\mydir\mytable2.dbf ALIAS mytable2 IN 0

>Hi all,
>
>I have the following code
>

>IF !USED("mytable")
>    USE c:\mydir\mytable.dbf ALIAS mytable
>ENDIF
>SELECT mytable
>GO TOP
>DO WHILE !EOF()
>   IF !USED("mytable2")
>       USE c:\mydir\mytable2.dbf ALIAS mytable2
>   ENDIF
>   REPLACE mytable.field1 WITH mytable2.field1
>   SELECT mytable
>   IF !EOF()
>      SKIP
>   ENDIF
>ENDDO

>But as soon as I open mytable2 the ALIAS mytable cannot be found.
>
>Why is this ?