FORM 10-Q

                                              SECURITIES AND EXCHANGE COMMISSION
                                                    Washington, D.C. 20549

(Mark One)

[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
	OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 1997

OR

[ ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
	OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from	N/A to	N/A
Commission file number 0-12984

                                                ADVANCED TOBACCO PRODUCTS, INC.
                                    (Exact name of registrant as specified in
                                       its charter)

	TEXAS								74-2285214
(State or other jurisdiction				(I.R.S. Employer
of incorporation or organization)			Identification No.)

                                    16607 Blanco Road, Suite 1504, San Antonio,
                                            Texas 78232
                                      (Address of principal executive offices)
                                             (Zip Code)
                                                        (210) 408-7077
                                     (Registrant's telephone number, including
                                               area code)
                                                              N/A
                               (Former name, former address and former fiscal
                                 year, if changed  since last report)

	Indicate by check mark whether the registrant (1) has filed all reports
 required to be filed by Section 13 or 15(d) of the Securities Exchange Act
 of 1934 during the preceding 12 months (or for such shorter period that the
 registrant was required to file such reports), and (2) has been subject to
 such filing requirements for the past 90 days.

Yes 	X	No

                       APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                          PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

	Indicate by check mark whether the registrant has filed all documents and
 reports required to be filed by Sections 12, 13 or 15(d) of the Securities
 Exchange Act of 1934 subsequent to the distribution of securities under a
 plan confirmed by a court.

Yes	No	N/A

                             APPLICABLE ONLY TO CORPORATE ISSUERS:

	Indicate the number of shares outstanding of each of the issuer's classes of
 common stock, as of the latest practicable date:
                                           8,092,136 as of March 31, 1997

							PART I - FINANCIAL INFORMATION

							Item 1:  Financial Statements



ADVANCED TOBACCO PRODUCTS, INC.
dba ADVANCED THERAPEUTIC PRODUCTS, INC.
BALANCE SHEETS
                                            								(Unaudited)	(Audited)
								                                             March 31    June 30
			                                           					     1997		  1996

ASSETS:

CURRENT ASSETS:
    Cash & cash equivalents			                    $   72,018	$   84,918
    Investments					                                 348,933	   237,434
    Accrued Royalty					                              57,000	   -0-    
    Accounts receivable				                              539	   -0-    
		
    Total current assets:		                      	   478,490	   322,352
		
LICENSE AGREEMENTS, Net:		                      		   157,675	   154,809

INVESTMENTS:                                						   952,332	 1,007,837
		
    TOTAL ASSETS:			                            		$1,588,497	$1,484,998
		
LIABILITIES AND SHAREHOLDERS' EQUITY:		
		
LIABILITIES:		
    Accounts payable                          			$   10,557	 $   3,528
		
    TOTAL LIABILITIES:			                       	    10,557	     3,528

SHAREHOLDER'S EQUITY:
    Common stock, $.01 par value;
    30,000,000 shares authorized;
    8,092,136 and 7,952,136 shares
    outstanding as of March 1997,
    and June 1996, respectively	                	    80,922	    79,522
    Additional paid-in-capital		                 12,544,878	12,528,778
    Accumulated deficit			                     	(11,047,860)(11,126,830)
		
    TOTAL STOCKHOLDERS' EQUITY:		                 1,577,940	 1,481,470
		
    TOTAL LIABILITIES AND STOCKHOLDERS'
    EQUITY:                                						$1,588,497	$1,484,998

ADVANCED TOBACCO PRODUCTS, INC.
dba ADVANCED THERAPEUTIC PRODUCTS, INC.
STATEMENT OF INCOME 
                                        							     (Unaudited)
		                                  					   Three Months Ended March 31
							                                           1997       1996

REVENUES: 
    Royalty Income		                      		$   57,000	$     -0-  
          Total operating revenue:	             57,000	      -0-  
		
EXPENSES:
    General and Administrative	                 27,018	     18,176
     Total operating expenses:	                 27,018	     18,176
		
INCOME (LOSS) FROM OPERATIONS:             	    29,982	     (18,176) 
		
OTHER INCOME :		
    Interest Income				                         17,791	     19,011  
          Total other income 		                 17,791	     19,011  
		
NET INCOME:			                            		$   47,773  $      835  
		
WEIGHTED AVERAGED NUMBER OF SHARES
  OF COMMON STOCK OUTSTANDING:	              8,092,136	  7,792,136  

EARNINGS PER COMMON SHARE:		                $    .005	        NIL  
		
		                                  					         (Unaudited)
				                               			    Nine Months Ended March 31
							                                     1997            1996

REVENUES:	
    Royalty Income	                       		$  135,200	$     -0-   	
          Total operating revenue:	            135,200	      -0-   
		
Expenses:	
    General and Administrative	                114,537	    76,097  
          Total Expenses:	                     114,537	    76,097  

INCOME (LOSS) FROM OPERATIONS:	                 20,663	    (76,097) 
		
OTHER INCOME:		
    Interest Income				                         58,308	    58,143  
          Total other income		                  58,308	    58,143  
		
NET INCOME (LOSS):		                      		$   78,971	$  (17,954) 
		
WEIGHTED AVERAGED NUMBER OF SHARES
    OF COMMON STOCK OUTSTANDING:           	 8,092,136	 7,792,136  
		
EARNINGS (LOSS) PER COMMON SHARE:	          $      .01	$    (.002) 

ADVANCED TOBACCO PRODUCTS, INC.
dba ADVANCED THERAPEUTIC PRODUCTS, INC.
STATEMENTS OF CASH FLOWS


                                       									(Unaudited)
							                                		Nine Months Ended March 31
                                         					 1997        	1996

CASH FLOWS FROM OPERATING ACTIVITIES:
    Net income (loss):				                 $   78,971	$  (17,954)
    Adjustments to reconcile net income
     (loss) to net cash:
       Amortization	                      					 5,010		     5,010  
       Accounts receivable		                 		  (539) 		    -0-  
       Accrued royalty				                    (57,000)	
       Accounts payable and accrued
                 liabilities               				 7,029		     3,946  
		
     Net cash provided by operations:		        33,471		    (8,998) 
		
CASH FLOWS FROM INVESTING ACTIVITIES:		
    Capital expenses of license agreements	    (7,875)	   (28,633) 

    Net cash provided by investments:	        	(7,875)	   (28,633) 

CASH FLOWS FROM FINANCING ACTIVITIES:		
    Exercise of Stock Option 			              	17,500		     -0-    

    Net cash provided by financing:          		17,500		     -0-    
		
NET INCREASE  (DECREASE) IN CASH:			           43,096		   (37,631) 
		
CASH & INVESTMENTS AT BEGINNING 
     OF PERIOD:					                        1,330,189	  1,363,058  
CASH & INVESTMENTS AT END OF PERIOD:	      $1,373,285	 $1,325,427  
		

NOTES TO FINANCIAL STATEMENTS

     The condensed financial statements included herein were prepared by the
 Company without audit.  Certain information and footnote disclosures
 normally included in financial statements have been omitted.  The condensed
 financial statements should be read in conjunction with the financial
 statements and the notes thereto included in the Company's Annual Report on
 Form 10-K as of June 30, 1996.

	Item 2:  Management's Discussion and Analysis of Financial
           Condition and Results of Operation

RESULTS OF OPERATIONS

     In 1987, the Company sold nicotine technology to an entity which is now
 owned or controlled by Pharmacia & Upjohn, Inc. ("Pharmacia & Upjohn"), a
 worldwide pharmaceutical company that manufactures the Nicorette Chewing
 Gum, the Nicotrol/Nicorette Patch and the Nicotrol/Nicorette Nasal Spray and
 the Nicotrol/Nicorette Inhaler.

     Based upon nicotine technology acquired from the Company, Pharmacia &
 Upjohn developed their Nicotrol/Nicorette Inhaler for use in the nicotine
 replacement therapy ("NRT") market. ATP will receive product payments of 3%
 of sales of the Inhaler to wholesale distributors.  Pharmacia & Upjohn
 launched its Inhaler commercially in Denmark in September 1996, in Sweden
 in December 1996, and in Italy in February 1997, under the trade name of
 the Nicorette Inhaler and for the nine-month period ended March 31, 1997, the
 Company recognized $83,974 in revenue as a result of these initial European
 sales.  Additional worldwide launches are planned by Pharmacia & Upjohn to 
occur as regulatory approvals are granted.

     The Inhaler was recently approved for sale as a prescription product by
 the United States Food and Drug Administration, and the Company anticipates
 that the Inhaler will be launched in the U.S. later this year as the
 Nicotrol Inhaler by McNeil Consumer Products, a Johnson & Johnson company.
  The U.S. represents approximately 50% of the world NRT market.

     Outside the U.S., the Inhaler is marketed by Pharmacia & Upjohn as the
 Nicorette Inhaler.  The Inhaler has been approved as a prescription product
 in the Netherlands and applications are pending in ten other countries,
 including the United Kingdom.

     The Inhaler is the only NRT to help smokers quit by addressing the
 hand-to-mouth motions of smokers, as well as providing a sensation in the
 back of the throat similar to the feeling of inhaling smoke.

     Effective as of October 1993, the Company has an agreement with
 Pharmacia & Upjohn under which, among other matters, the Company has the
 right to receive a royalty equal to .1% of net revenues received by
 Pharmacia & Upjohn from the sale of any product using a nicotine
 impermeable copolymer technology covered by, and subsequent to, the 
issuance of a patent in March 1996.  Under the terms of the agreement,
 for the nine-month period ended March 31, 1997, the Company recognized
 $51,226 in revenue as the result of sales of the Nicotrol/Nicorette Patch.

     In order to create future growth opportunities and take advantage of
 emerging technologies, the Company licensed a dry powder nicotine inhaler
 technology from Duke University in 1992 and has had several U.S. patent
 filings subsequently approved.  The Company is continuing to seek a
 strategic partner to further develop this technology.

LIQUIDITY AND CAPITAL RESOURCES

     Cash resources, including investments, available on March 31, 1997,
 were approximately $1,375,000, as compared to approximately $1,325,000,
 for March 31, 1996.

COMPARISON OF SELECTED FINANCIAL DATA

     Operating Revenues for the nine-month period ended March 31, 1997,
 increased to $135,200, as compared to $-O- for the nine-month period
 ended March 31, 1996.  This increase is due to the recognition of income
 from the Inhaler and the nicotine impermeable copolymer technology.

     Interest income for the nine-month period ended March 31, 1997,
 increased to $58,308, as compared to $58,143 for the nine-month period
 ended March 31, 1996.  This increase is primarily due to minor interest
 rate fluctuations.

     Net income for the nine-month period ended March 31, 1997, increased to
 $78,971, as compared to a net loss of $17,954 for the nine-month period
 ended March 31, 1996.  This increase is due to the recognition of income
 from the Inhaler and the nicotine impermeable copolymer technology.

     General and administrative expenses for the nine-month period ended
 March 31, 1997, increased to $114,537, as compared to $76,097 for the 
nine-month period ended March 31, 1996.  This increase is primarily due to
 the award of a one-time bonus in the amount of $17,500 to a consultant and
 a Director of the Company and to the costs associated with press releases
 and mailings to shareholders as a result of the Inhaler marketing
 introduction.

PART II - OTHER INFORMATION

	Item 1:  Legal Proceedings

		    	None

	Item 2:  Changes in Securities

				None

	Item 3:  Defaults Upon Senior Securities

				None

	Item 4:  Submission of Matters to a Vote of Security Holders
		
				None

	Item 5:  Other Information

				None

	Item 6:  Exhibits and Reports on Form 8-K

				None

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 thereunto duly authorized.

					ADVANCED TOBACCO PRODUCTS, INC.
				         	       (Registrant)


Dated: May 12, 1997
					By:/s/ J. W. Linehan          
					   J. W. Linehan, President
					   Chief Executive Officer and
					   Chief Accounting Officer

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