SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                ----------------
                                    FORM 10-Q
(Mark One)

  _X_     QUARTERLY   REPORT  PURSUANT  TO  SECTION  13  OR  15(d)  OF  THE
          SECURITIES EXCHANGE ACT OF 1934.

                 For the quarterly period ending March 31, 1998

                                       OR

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

               For the transition period from ________ to _______

                          Commission file number 1-4719

                             THE DELTONA CORPORATION
             -----------------------------------------------------
             (Exact name of registrant as specified in its charter)


            DELAWARE                                          59-0997584
--------------------------------------------------------------------------------
(State of other jurisdiction of                            (I.R.S. Employer
incorporation or organization)                           Identification Number)

999 BRICKELL AVENUE, SUITE 700, MIAMI, FLORIDA                  33131
--------------------------------------------------------------------------------
(Address of principal executive office)                       (Zip Code)

Registrant's telephone number, including area code          (305) 579-0999
                                                  ------------------------------

     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of  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 No

     Indicate the number of shares outstanding of the issuer's classes of common
stock, as of the latest practicable date:  13,544,277 shares of common stock, $1
par value,  excluding  treasury  stock,  as of March 31, 1998.

<PAGE>

                          PART I FINANCIAL INFORMATION
                          ============================

ITEM 1.   FINANCIAL STATEMENTS


                    THE DELTONA CORPORATION AND SUBSIDIARIES
                    ----------------------------------------
                 UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS
                 -----------------------------------------------
                      MARCH 31, 1998 AND DECEMBER 31, 1997
                      ------------------------------------
                                 ($000 Omitted)

<TABLE>
<CAPTION>
                                                                 March 31,      December 31,
                                                                   1998             1997
                                                                 ---------      ------------
<S>                                                              <C>            <C>

Cash and temporary cash investments,
 including escrow deposits and restricted
 cash of $814 in 1998 and $1293 in 1997.....................     $      918     $   1,397
                                                                 ----------     ---------
Contracts receivable for land sales - net...................          2,640         2,698
                                                                 ----------     ---------
Mortgages and other receivables - net.......................            693         1,291
                                                                 ----------     ---------     

Inventories (b):
 Land and land improvements.................................          7,521         7,449
 Other......................................................             99            99
                                                                 ----------     ---------
     Total inventories......................................          7,620         7,548
                                                                 ----------     ---------     

Property, plant, and equipment at cost - net................            366           374
                                                                 ----------     ---------
Prepaid expenses and other..................................            188           252
                                                                 ----------     ---------
     Total..................................................     $   12,425     $  13,560
                                                                 ==========     =========


                LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
                -------------------------------------------------


Mortgages and similar debt(c):
 Mortgage notes payable....................................      $    6,670     $   6,693
 Other loans ..............................................           2,030         2,294
                                                                 ----------     ---------
   Total mortgages and similar debt........................           8,700         8,987

Accounts payable, accrued expenses,
 customers' deposits.......................................           6,770         6,676
Allowance for Marco permit costs (d).......................               0             0
Deferred revenue...........................................           3,246         3,511
                                                                 ----------     ---------
     Total liabilities.....................................          18,716        19,174
                                                                 ----------     ---------

Commitments and contingencies (d):
 Stockholders' equity (deficiency):
  Common stock, $1 par value - authorized
  15,000,000 shares; outstanding:1998 and
  1997 - 13,544,277  shares and 6,734,939
  shares  (excluding  12,228 shares
  held in treasury in 1998 and 1997).......................          13,544         13,544
 Capital surplus...........................................          51,441         51,495
 Accumulated deficit.......................................         (71,276)       (70,653)
                                                                 ----------     ----------
     Total stockholders' (deficiency)......................          (6,291)        (5,614)
                                                                 ----------     ----------
          Total............................................      $   12,425     $   13,560
                                                                 ==========     ==========
</TABLE>
                                       2
<PAGE>


                    THE DELTONA CORPORATION AND SUBSIDIARIES
                    ----------------------------------------
            UNAUDITED CONDENSED STATEMENTS OF CONSOLIDATED OPERATIONS
            ---------------------------------------------------------
                            FOR THE PERIODS INDICATED
                            -------------------------
                     ($000 Omitted Except Per Share Amounts)

<TABLE>
<CAPTION>
                                                               Three Months Ended
                                                             ------------------------    
                                                             March 31,      March 31,
                                                               1998           1997
                                                             ---------      ---------
<S>                                                         <C>            <C>    
Revenues (a):
 Net land sales......................................       $     644      $   1,129
 House and apartment sales...........................             219            321
 Recognized improvement
  revenue/ prior period
  sales..............................................             266            184
 Interest income.....................................             169            330
 Other revenues......................................              81            108
                                                            ---------      ---------
     Total...........................................           1,379          2,072
                                                            ---------      ---------

Costs and expenses (a):
 Cost of sales and
  improvements.......................................             497            628
 Selling, general and
  administrative and other
  expenses...........................................           1,290          1,417
 Interest expense (c)(e).............................             214            456
                                                            ---------      ---------
     Total...........................................           2,001          2,501
                                                            ---------      ---------

Loss from operations ................................            (622)          (429)
                                                            ---------      ---------
Net Income (Loss)....................................       $    (622)     $    (429)
                                                            =========      =========
Basic earnings (Loss) per common and
 common equivalent shares:
 From operations.....................................            (.05)          (.06)
                                                            ---------      ---------
Net Income (Loss)....................................       $    (.05)     $    (.06)
                                                            =========      =========

Number of common and common
 equivalent shares...................................       13,544,277     6,734,906
                                                            ==========     =========

</TABLE>


No dividends have been paid on Common Stock.
Results  of  operations  for the first  three  months may not be  indicative  of
results  which  may be  expected  for the full  year.  See  Notes  to  Unaudited
Condensed Consolidated Financial Statements.
See Management's Analysis of Quarterly Statements of Operations included herein.
Certain amounts have been reclassified for comparative purposes.


                                       3
<PAGE>


                    THE DELTONA CORPORATION AND SUBSIDIARIES
                    ----------------------------------------
            UNAUDITED CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS
            ---------------------------------------------------------
                           FOR THE THREE MONTHS ENDED
                           --------------------------
                        MARCH 31, 1998 AND MARCH 31, 1997
                        ---------------------------------
                                 ($000 Omitted)

<TABLE>
<CAPTION>
                                                               Three Months Ended
                                                             ------------------------    
                                                             March 31,      March 31,
                                                               1998           1997
                                                             ---------      ---------
<S>                                                         <C>            <C>
Cash flows from operating activities..............          $    (476)     $     (31)
                                                            ---------      ---------
Cash flows from investing activities:
  Proceeds from sale of property, plant
  and equipment...................................                  0              3
 Payment for acquisition and construction
  of property plant and equipment.................                 (3)            (2)
                                                            ---------      ---------
Net cash provided by (used in) investing
 activities.......................................                 (3)             1
                                                            ---------      ---------

Cash flows from financing activities:
  New borrowings..................................                  0              0
  Repayment of borrowings.........................                  0              0
                                                            ---------      ---------

Net cash provided by (used in) financing
 activities.......................................                  0              0
                                                            ---------      ---------
Net increase (decrease) in cash and
 temporary cash investments (including
 escrow deposits and restricted cash).............               (479)           (30)

Cash and temporary cash investments at
 December 31, 1997 and December 31, 1996..........              1,397            907
                                                            ---------      ---------

Cash and temporary cash investments at
 March 31, 1998 and March 31, 1997................          $     918      $     877
                                                            =========      =========
</TABLE>


See Notes to Unaudited Condensed Consolidated Financial Statements.
Certain amounts have been reclassified for comparative purposes.


                                       4
<PAGE>
                    THE DELTONA CORPORATION AND SUBSIDIARIES
                    ----------------------------------------
            UNAUDITED CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS
            ---------------------------------------------------------
                           FOR THE THREE MONTHS ENDED
                           --------------------------
                        MARCH 31, 1998 AND MARCH 31, 1997
                        ---------------------------------
                                 ($000 Omitted)

<TABLE>
<CAPTION>
                                                               Three Months Ended
                                                             ------------------------    
                                                             March 31,      March 31,
                                                               1998           1997
                                                             ---------      ---------
<S>                                                         <C>            <C>

Reconciliation of net income (loss)
 to net cash provided by (used in)
 operating activities:

  Net loss..........................................        $    (622)     $   (429)
                                                            ---------      --------

Adjustments  to reconcile  net loss to net cash
 provided by (used in) operating activities:

  Depreciation and amortization.....................               12            14
  Provision for estimated uncollectible sales-net...              241           412
  Contract valuation discount, net of amortization..               54            74
  Net Gain on sale of property, plant &
    equipment.......................................                0            (3)
  Net change in assets and liabilities..............             (161)          (79)
                                                            ---------      --------
     Total adjustments..............................        $     146      $    398
                                                            ---------      --------

  Net cash provided by (used in) operating
     activities.....................................        $    (476)     $    (31)
                                                            =========      ========

  Supplemental disclosure of non cash
      investing and financing activities:

  Common Stock issued for Marco Settlement.........         $       0      $      1
                                                            =========      ========

  Reduction of debt as a result of the conveyance
     of contracts receivable.......................         $     287      $      0
                                                            =========      ========

</TABLE>
                                       5

<PAGE>


                    THE DELTONA CORPORATION AND SUBSIDIARIES
                    ----------------------------------------
         NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
         --------------------------------------------------------------
                                 MARCH 31, 1998
                                 --------------


(a)  SIGNIFICANT ACCOUNTING POLICIES

     The  condensed  unaudited  financial  statements  of the Company  have been
     prepared  pursuant  to the  rules and  regulations  of the  Securities  and
     Exchange  Commission (the  "Commission").  Certain information and footnote
     disclosures   normally  included  in  financial   statements   prepared  in
     accordance  with  generally  accepted   accounting   principles  have  been
     condensed or omitted  pursuant to  Commission  rules and  regulations.  The
     information  furnished  reflects,  in  the  opinion  of  the  Company,  all
     adjustments (consisting only of normal recurring adjustments) necessary for
     a fair statement of the results for the interim  periods  presented.  These
     condensed  consolidated  financial statements should be read in conjunction
     with  the  financial  statements  and the  notes  thereto  included  in the
     Company's latest Annual Report on Form 10-K.


(b)  INVENTORIES

     Information  with  respect to the  classification  of inventory of land and
     improvements  including  land held for sale or  transfer  is as follows (in
     thousands):

     <TABLE>
     <CAPTION>
                              Land and Improvements
                              ---------------------

                                                            March 31, December 31,
                                                               1998       1997
                                                            --------- ------------
     <S>                                                    <C>       <C>

     Unimproved land...................................     $    420  $    420
     Land in various stages of
      development......................................        2,027     1,888
     Fully improved land...............................        5,074     5,141
                                                            --------  --------
          Total........................................     $  7,521  $  7,449
                                                            ========  ========

     </TABLE>
     Other inventories consists primarily of vacation ownership units completed.


(c)  MORTGAGES AND SIMILAR DEBT

     Indebtedness  under a mortgage and loan  agreements  is  collateralized  by
     substantially  all of the  Company's  assets,  including  stock of  certain
     wholly-owned subsidiaries.

     The  following  table  presents  information  with respect to mortgages and
     similar debt (in thousands):

     <TABLE>
     <CAPTION>
                                                            March 31,      December 31,
                                                              1998            1997
                                                            ---------      ------------
     <S>                                                    <C>            <C>
     Mortgage Notes Payable ............................... $  6,670       $  6,693
     Other Loans...........................................    2,030          2,294
                                                            --------       --------
         Total mortgages and similar debt.................. $  8,700       $  8,987
                                                            ========       ========
     
     </TABLE>
                                        6

     <PAGE>
     Included in Mortgage  Notes  Payable is the Yasawa Loan  ($6,670,000  as of
     March  31,  1998);   included  in  Other  Loans  is  the  Scafholding  Loan
     ($2,030,000  as of March 31, 1998).  The  Scafholding  Loan is secured by a
     first lien on the  Company's  receivables.  The Yasawa Loan is secured by a
     second  lien on the  Company's  receivables  and a  mortgage  on all of the
     Company's  property.  As of March 31, 1998, loans outstanding to Yasawa and
     Scafholding  totaled  $8,700,000.  The terms of repayment of this debt have
     been  restructured  to provided  for a monthly  payment of principal in the
     amount of $100,000 payable monthly in cash or with contracts  receivable at
     100% of face value,  plus interest payable monthly on the declining balance
     of the rate of 9.6% per annum in cash or with  contracts  receivable at 65%
     of face value.


(d)  COMMITMENTS AND CONTINGENCIES

     Homesite  sales  contracts  provide  for the return of all  monies  paid in
     (including  paid-in  interest)  should  the  Company  be unable to meet its
     contractual  obligations after the use of reasonable diligence. If a refund
     is made, the Company will recover the related  homesite and any improvement
     thereto.

     As a result of the delays in completing  the land  improvements  to certain
     property sold in certain of its Central and North Florida communities,  the
     Company  fell  behind  in  meeting  its  contractual   obligations  to  its
     customers. In connection with these delays, the Company, in February, 1980,
     entered into a Consent Order with the Division which provided a program for
     notifying  affected  customers.  The Consent Order,  which was restated and
     amended,  provided  a  program  for  notifying  affected  customers  of the
     anticipated  delays in the completion of  improvements  (or, in the case of
     purchasers of  unbuildable  lots in certain  areas of the  Company's  Sunny
     Hills  community,  the transfer of  development  obligations to core growth
     areas of the community);  various options which may be selected by affected
     purchasers; a schedule for completing certain improvements;  and a deferral
     of the obligation to install water mains until  requested by the purchaser.
     Under an  agreement  with  Topeka,  Topeka's  utility  companies  agreed to
     furnish  utility   service  to  the  future   residents  of  the  Company's
     communities on substantially  the same basis as such services were provided
     by the Company.  The Consent  Order also required the  establishment  of an
     improvement  escrow  account as assurance for completing  such  improvement
     obligations.

     In June,  1992,  the Company  entered into the 1992 Consent  Order with the
     Division,  which  replaced and superseded  the original  Consent Order,  as
     amended  and  restated.   Among  other  things,   the  1992  Consent  Order
     consolidated  the  Company's  development  obligations  and  provided for a
     reduction  in its  required  monthly  escrow  obligation  to $175,000  from
     September,  1992 through December,  1993. Beginning January, 1994 and until
     development is completed or the 1992 Consent Order is amended,  the Company
     was required to deposit $430,000 per month into the escrow account. As part
     of the assurance  program under the 1992 Consent Order, the Company and its
     lenders had granted the Division a lien on certain  receivables  and future
     receivables. The Company defaulted on its obligation to escrow $430,000 per
     month for the period of January,  1994 through November 1997. In accordance
     with the 1992  Consent  Order,  collections  on Division  receivables  were
     escrowed for the benefit of purchasers from March 1, 1994 through April 30,
     1994. In May, 1994 the Company  implemented a program to have customers who
     had  contracted to purchase  property  which is  undeveloped  exchange such
     property for developed property. As of March 31, 1998, approximately 85% of
     such  customers  have  opted  to  exchange  or have  had  their  situations
     otherwise resolved.

     On December 30, 1997, the Division approved the formation of a Lot Exchange
     Trust into which the Company  conveyed  sufficient  exchange  inventory  to
     provide  exchanges to customers with undeveloped  lots.  Concurrently,  the
     Division released its lien on the Company's contracts receivable, satisfied
     its mortgage on the  Company's  property  and approved a settlement  of all
     remaining  issues under the 1992 Deltona  Consent  Order.  The 1992
     Deltona Consent Order was terminated on April 13, 1998.

                                       7

     <PAGE>
     As of March 31, 1998, the Company had estimated development  obligations of
     approximately  $25,000 on sold property,  an estimated liability to provide
     title  insurance  and deeding  costing  $557,000 and an  estimated  cost of
     street  maintenance,  prior  to  assumption  of such  obligations  by local
     governments,  of $429,000,  all of which are included in deferred  revenue.
     The total cost to complete  improvements  at March 31, 1998,  including the
     previously  mentioned  obligations,   was  estimated  to  be  approximately
     $1,011,000.  As of March 31, 1998 the  Company had in escrow  approximately
     $50,000  specifically  for maintenance  and  improvements at certain of its
     Central and North Florida communities. The Company's development obligation
     was  substantially  reduced in 1997 by the  consummation  of the  Agreement
     approved by the stockholders on November 4, 1997.  Approximately $7,400,000
     of the development  obligation at St. Augustine Shores was assumed by Swan.
     In addition,  the creation of a Lot Exchange Trust reduced the  development
     obligation at Marion Oaks and Sunny Hills by approximately $5,800,000.

     The  Company's  continuing  liquidity  problems  have  precluded the timely
     payment of the full amount of certain real estate  taxes.  Delinquent  real
     estate taxes aggregated  approximately  $1,689,000 as of March 31, 1998. On
     properties where customers have contractually assumed the obligation to pay
     into a tax escrow  maintained  by the  Company,  the  Company  has and will
     continue to pay  delinquent  real estate taxes as monies are collected from
     customers. Of the $1,689,000 in delinquent real estate taxes, approximately
     $48,000  relates  to sold  lots on  which  the  customer  has  assumed  the
     obligation to pay but has not done so.

     In addition to the matters  discussed  above and in Note 9 to the Company's
     Consolidated  Financial  Statements included in the Company's Annual Report
     on Form 10-K for the year ended  December 31, 1997,  the Company is a party
     to other  litigation  relating  to the  conduct  of its  business  which is
     routine in nature  and, in the  opinion of the  management,  should have no
     material effect upon the Company's operation.


(e)  CAPITALIZED INTEREST

     The  Company   capitalizes   interest  cost  incurred  during  a  project's
     construction  period.  Of the total  interest cost incurred of $214,000 and
     $456,000,  none was  capitalized  for the three months ended March 31, 1998
     and March 31, 1997, respectively.


(f)  EARNINGS OR LOSS PER SHARE

     Basic earnings (loss) per common and common  equivalent share were computed
     by dividing net income (loss) by the weighted  average  number of shares of
     Common Stock and common stock equivalents  outstanding  during each period.
     The  earnings  (loss) and the average  number of shares of Common Stock and
     common stock equivalents used to calculate earnings per share for the three
     months  ended  March  31,  1998 and  March 31,  1997  were  $(622,000)  and
     $(429,000) and 13,544,277 and 6,734,906, respectively.

                                       8
<PAGE>


ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
          CONDITION AND RESULTS OF OPERATIONS


On November 4, 1997,  at the 1997 Annual  Meeting,  the  Company's  stockholders
approved  an   Agreement   between  the  Company  and  its  lenders  that  would
substantially reduce the Company's  outstanding debt obligation of $25.3 million
(the "Agreement").  The Agreement,  consummated effective December 30, 1997 upon
approval of the Division of Florida Land Sales,  Condominiums  and Mobile Homes,
resulted in a reduction in the Company's outstanding debt obligation through the
conveyance of all remaining land inventory and  obligations in the Company's St.
Augustine  Shores  Subdivision  and the  issuance of  approximately  6.8 million
shares of Common Stock at $1.00 per share (par value). Additionally, the lenders
purchased  $7.5  million in  contracts  receivable  from the Company to generate
working capital and further reduce the debt obligation. Specifically:

     1. Selex sold its remaining debt  ($2,664,736),  including the Empire note,
to Yasawa and the Company owes no further  duty or  obligation  to Selex,  which
provided  the  Company a release.  The debt  purchased  by Yasawa was  satisfied
through  Yasawa's  purchase of  2,664,736  shares of Common  Stock issued by the
Company at a per share conversion price of One Dollar ($1.00), which is equal to
par value.

     2. Swan had  previously  acquired  $5,529,501  of the  Company's  debt from
Selex. This $5,529,501 was satisfied through the Company's  conveyance of all of
the Company's  remaining  land inventory and  obligations  in its St.  Augustine
Shores Subdivision to Swan . The price, based upon appraised value, was adjusted
to take into account the development obligations on sold lots assumed by Swan.


     3.  Scafholding,   purchased   approximately   $7.5  million  in  contracts
receivable  from the Company at  seventy-five  percent  (75%) of face value with
recourse for non-performing  contracts.  This sale generated  approximately $5.6
million,  $1,982,457 of which was used to reduce outstanding debt to Yasawa. The
balance  (of  which  $1  million  is in  the  form  of a  promissory  note  from
Scafholding  to the Company) will be used by the Company to pay a portion of the
delinquent real estate taxes, to implement its marketing  programs,  to initiate
development   of  TimberWalk   and  to  meet  the  Company's   working   capital
requirements.

     4. A  $4,144,602  portion of the  Company's  debt to Yasawa  was  satisfied
through  Yasawa's  purchase of  4,144,602  shares of Common  Stock issued by the
Company at a per share conversion price of One Dollar ($1.00), which is equal to
par value.

As of  March  31,  1998,  the  Company's  outstanding  debt to  Scafholding  was
$2,029,709,  secured by a first lien on the Company's receivables; the Company's
outstanding  debt to  Yasawa  was  $6,670,291  secured  by a second  lien on the
Company's  receivables  and a mortgage on all of the Company's  property.  As of
March 31, 1998, loans outstanding to Yasawa and Scafholding  totaled $8,700,000.
The  terms of  repayment  of this debt have been  restructured  to  provide  for
monthly  payments of principal in the amount of $100,000 payable monthly in cash
or with  contracts  receivable  at 100% of face  value,  plus  interest  payable
monthly on the  declining  balance at the rate of 9.6% per annum in cash or with
contracts receivable at 65% of face value.

In the  future,  if the Company  elects to do so,  Yasawa and  Scafholding  have
agreed to purchase contracts receivable at 65% of face value, with recourse,  to
meet the Company's ongoing capital requirements.

Prior to November 4, 1997 and independent of the Agreement outlined above, Selex
and Yasawa  agreed to forgive  $2,050,818  in accrued  interest on the Company's
debt to them.

                                       9

<PAGE>
Through  Yasawa's  acquisition  of the  6,809,338  shares of Common Stock of the
Company referenced above, Mr. Antony Gram's beneficial  ownership increased from
3,109,703 shares to 9,919,041 shares (73.23% of the outstanding shares of Common
Stock of the Company as of March 20, 1998).

As a consequence of its liquidity position,  the Company has not paid delinquent
real estate taxes which aggregate approximately $1,689,000 as of March 31, 1998;
non-payment  of these  delinquent  taxes  may  adversely  affect  the  financial
condition of the Company.

On March 10, 1998, the Company  entered into a related party agreement with
Swan  Development  Corporation  ("Swan")  whereby  Swan  acquired  approximately
$375,000  in  property  in  Marion  Oaks in  exchange  for their  obligation  to
construct  an  office  building  to house the  Company's  corporate  office  and
TimberWalk  sales  center.  The  sales  price  will  provide  rent  credits  for
approximately four and one-half years to the Company.



RESULTS OF OPERATIONS
---------------------

For the three months ended March 31, 1998 and March 31, 1997.

Revenues
--------

Total  revenues  were  $1,379,000  for the first  quarter  of 1998  compared  to
$2,072,000 for the comparable 1997 period.

Gross land sales were $966,000 for the first  quarter of 1998 versus  $1,682,000
for the first quarter of 1997.  Net land sales (gross land sales less  estimated
uncollectible  installment sales and contract valuation  discount)  decreased to
$644,000 for the first three months of 1998 from  $1,129,000 for the first three
months of 1997.  The decrease in sales  reflects  lower sales from the Company's
independent dealer network.

There were no bulk land sales for the first quarter of 1998 or 1997. In light of
the Company's  diminished bulk land sales  inventory it is anticipated  that the
Company will produce a negligible  volume of bulk land sales. See "Liquidity and
Capital Resources -- Mortgages and Similar Debt".

Housing  revenues  were  $219,000 for the three months ended March 31, 1998
compared to $321,000 for the same period in 1997.  Revenues  are not  recognized
from housing sales until the  completion of  construction  and passage of title.
Housing  revenues  decreased  as of result  of lower  sales  from the  Company's
independent  dealer  network.  The  backlog  of houses  under  construction  was
$1,206,000  and $409,000 for the three months ended March 31, 1998 and March 31,
1997,  respectively.  The Company in the process of developing TimberWalk, a new
housing community in Ocala, Florida, which is anticipated to open in June, 1998.

The  following  table  reflects the  Company's  real estate  product mix for the
periods indicated (in thousands):

<TABLE>
<CAPTION>
                                 Three Months Ended
                                 -------------------
                                 March 31, March 31,
                                  1998        1997
                                 --------- ---------
          <S>                    <C>       <C>
          Gross Land Sales:
          Retail Sales<F1>      $    966  $ 1,682
                                 --------  -------
          Housing Sales:
          Single Family               219      321
                                 --------  -------
               Total Real Estate $  1,185  $ 2,003
                                 ========  =======


                                       10
<PAGE>

<FN>
---------------------

<F1> New retail land sales contracts  entered into,  including  deposit sales on
     which the Company has  received  less than 20% of the sales  price,  net of
     cancellations, for the three months ended March 31, 1998 and March 31, 1997
     were $769,000 and  $1,688,000,  respectively.  The Company had a backlog of
     approximately  $794,000 in  unrecognized  sales as of March 31, 1998.  Such
     contracts  are not  included  in retail  land  sales  until the  applicable
     rescission  period  has  expired  and the  Company  has  received  payments
     totaling 20% of the contract sales price.
</FN>
</TABLE>

Improvement  revenues  result from  recognition of revenues  deferred from prior
period sales.  Recognition occurs as development work proceeds on the previously
sold  property  or  customers  are  exchanged  to a developed  lot.  Improvement
revenues  totaled $265,000 for the first quarter of 1998 as compared to $184,000
for the first quarter of 1997.

Interest  income was  $168,800 for the first three months of 1998 as compared to
$330,000  for the first three  months of 1997.  The  decrease is the result of a
decrease  in the  Company's  contracts  receivable.  Resulting  from the sale of
$7,500,000 in contracts receivable for the fourth quarter 1997.

Other  revenues  were $81,000 as compared to $108,000 for the three months ended
March 31, 1998 and March 31, 1997,  respectively.  Other  revenues are generated
principally  by  the  Company's  title  insurance  and  real  estate   brokerage
subsidiaries.


Costs and Expenses
------------------

Costs and expenses for the first three months of 1998 were  $2,001,000  compared
to $2,501,000  for the same period in 1997.  Cost of sales totaled  $497,000 for
the three months ended March 31, 1998  compared to $628,000 for the three months
ended March 31, 1997.

Commissions,  advertising and other selling  expenses  totaled  $609,000 for the
three  months  ended March 31, 1998  compared to $649,000  for the three  months
ended  March 31,  1997.  The lower  retail  sales  levels  resulting  in reduced
commission  expense however other selling expenses increased to $277,000 for the
three  months  period of 1998 versus  $167,000  for 1997 as a result of start up
costs  incurred  in  preparation  of the  Company's  new  housing  community  in
TimberWalk.  Advertising and promotional  expenditures decreased to $16,000 from
$30,000 for the three month period of 1998 versus 1997.

General and administrative  expenses were $424,000 for the first three months of
1998  compared  to  $462,000  for the first  three  months of 1997.  General and
administrative  expenses  have  remained  constant  from period to period.


Real estate tax expense was $257,000 for the period ended March 31, 1998 as
compared  to $305,000  for the period  ended  March 31,  1997.  Included in real
estate tax expense is interest  and  administrative  fees on  delinquent  taxes,
which accrue interest at 18% per annum.

Interest expense for the first three months of 1998 was $214,000,  compared
to $456,000 for the first three months of 1997. The decrease in interest expense
is the result of a lower  outstanding  debt  resulting  from the debt  reduction
accomplished in the fourth quarter of 1997.

                                       11
<PAGE>


Net Income (Loss)
-----------------

The Company reported a net loss of $622,000 for the three months ended March 31,
1998 as compared to a net loss of $429,000  for the three months ended March 31,
1997.



Regulatory Developments which may affect Future Operations
----------------------------------------------------------

In Florida,  as in many growth areas,  local governments have sought to limit or
control  population  growth in their  communities  through  restrictive  zoning,
density reduction,  the imposition of impact fees and more stringent development
requirements.  Although the Company has taken such factors into consideration in
its master plans,  the  increased  regulation  has  lengthened  the  development
process and added to development costs.

On a statewide  level,  the Florida  Legislature  adopted  and  implemented  the
Florida  Growth  Management  Act of 1985 (the  "Act")  to aid local  governments
efforts to  discourage  uncontrolled  growth in Florida.  The Act  precludes the
issuance  of  development  orders  or  permits  if  public  facilities  such  as
transportation,  water and sewer services will not be available  concurrent with
development.  Development  orders  have been  issued for,  and  development  has
commenced  in,  the  Company's  existing  communities  (with  development  being
virtually completed in certain of these communities). Thus, such communities are
less  likely to be affected by the new growth  management  policies  than future
communities.  Any future  communities  developed by the Company will be strongly
impacted by new growth management  policies.  Since the Act and its implications
are consistently being re-examined by the State, together with local governments
and various state and local  governmental  agencies,  the Company cannot further
predict  the  timing  or the  effect  of new  growth  management  policies,  but
anticipates  that such  policies  may  increase  the  Company's  permitting  and
development costs.

In addition to Florida,  other  jurisdictions in which the Company's  properties
are  offered  for  sale  have   recently   strengthened,   or  are   considering
strengthening,  their regulation of subdividers and subdivided lands in order to
provide  further  assurances  to the  public,  particularly  given  the  adverse
publicity  surrounding  the  industry  which  existed in 1990.  The  Company has
attempted  to take  appropriate  steps to  modify  its  marketing  programs  and
registration  applications  in the face of such  increased  regulation,  but has
incurred  additional  costs  and  delays  in the  marketing  of  certain  of its
properties  in certain  states and  countries.  For  example,  the  Company  has
complied with  regulations of certain states which require that the Company sell
its  properties  to residents  of those  states  pursuant to a deed and mortgage
transaction,  regardless of the amount of the down payment.  The Company intends
to continue to monitor any  changes in  statutes or  regulations  affecting,  or
anticipated  to  affect,  the sale of its  properties  and  intends  to take all
necessary and  reasonable  action to assure that its properties and its proposed
marketing programs are in compliance with such regulations,  but there can be no
assurance  that the Company  will be able to timely  comply with all  regulatory
changes in all  jurisdictions  in which the Company's  properties  are presently
offered for sale to the public.



LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

Mortgages and Similar Debt
--------------------------

Indebtedness   under  a  mortgage  and  loan  agreements  is  collateralized  by
substantially  all  of  the  Company's   assets,   including  stock  of  certain
wholly-owned subsidiaries.


                                       12
<PAGE>

The loan modifications  consummated on December 31, 1997,  satisfied all Company
obligations to Selex and the  outstanding  loans to Scafholding  and Yasawa were
restructured. The following table presents information with respect to mortgages
and similar debt (in thousands):

<TABLE>
<CAPTION>
                                                        Years Ended
                                                  -----------------------
                                                  March 31,  December 31,
                                                     1998       1997
                                                  --------- -------------
          <S>                                     <C>       <C>
          Mortgage Notes Payable........          $  6,670  $  6,693
          Other Loans...................             2,030     2,294
                                                  --------  --------
          Total Mortgages and
          Similar Debt..................          $  8,700  $  8,987
                                                  ========  ========
</TABLE>

Included in Mortgage  Notes Payable is the Yasawa Loan  ($6,670,000  as of March
31, 1997);  included in Other Loans is the  Scafholding  Loan  ($2,030,000 as of
March 31, 1997).


     CONTRACTS AND MORTGAGES RECEIVABLE SALES


In June, 1992 and February,  1990, the Company  completed sales of contracts and
mortgages receivable totaling $13,500,000 and $17,000,000,  respectively,  which
generated approximately $8,000,000 and $13,900,000 respectively, in net proceeds
to the  Company.  The  anticipated  costs of the  June,  1992  transaction  were
included in the  extraordinary  loss from debt  restructuring for 1991 since the
restructuring was dependent on the sale. The Company recorded a loss of $600,000
on the February,  1990 sale. In conjunction with these sales the Company granted
the purchaser a security interest in certain additional  contracts receivable of
approximately  $2,700,000 and conveyed all of its rights,  title and interest in
the property  underlying  such contracts to a collateral  trustee.  In addition,
these  transactions,  among other  things  require  that the Company  replace or
repurchase any receivable  that becomes 90 days  delinquent  upon the request of
the  purchaser.  Such  requirement  can be satisfied from contracts in which the
purchaser holds a security interest (approximately $1,388,000 as of December 31,
1995). The purchaser of these receivables  experienced  financial difficulty and
filed in 1994 for protection under Chapter 11 of the Federal Bankruptcy Code. In
November 1995, the purchaser of these  receivables  sold the portfolio to Finova
Capital  Corporation.  The Company is unable to determine  what effect this will
have, if any, on future  cancellations,  since it is unable to determine how the
bankruptcy or the  subsequent  sale of the portfolio  will impact  servicing and
collection procedures and the customers'  determination to continue to pay under
those  contracts.  The Company has fully reserved for the amount of the holdback
account and the estimated future cancellations based on the Company's historical
experience for receivables the Company services. However, due to the uncertainty
noted  above,  the  Company  does not feel there is  sufficient  information  to
estimate  future  cancellations  and is unable to determine  the adequacy of its
reserves to replace or repurchase  receivables that become delinquent.  In 1996,
the  Company  replaced  $293,000  in  delinquent  receivables.  During the first
quarter of 1998, the Company did not replace any delinquent  receivables.  As of
March  31,  1998  and  1997,  $1,302,000  and  $1,271,000  in  receivables  were
delinquent, respectively.

In December, 1992, as described above, the Company sold $10,800,000 of contracts
and mortgages  receivable to an affiliate of Yasawa at face value,  applying the
proceeds therefrom to reduce the Bank Loan acquired by Yasawa.

In March,  1993, the Company  transferred  $1,600,000 in contracts and mortgages
receivable generating approximately $1,059,000 in proceeds to the Company, which
was used for  working  capital  and the  creation  of a holdback  account in the
amount of $150,000. As of March 31, 1998, the balance of the holdback account as
approximately $121,000.

In December 1997,  Scafholding purchased  approximately  $7,500,000 in contracts
receivable  from the Company at  seventy-five  percent  (75%) of face value with
recourse for non-performing  contracts.  This sale generated  approximately $5.6
million,  $1,982,457 of which was used to reduce outstanding debt to Yasawa. The
balance  (of  which  $1  million

                                       13

<PAGE>

is in the  form  of a  promissory  note  from  Scafholding  to the  Company
expected to be satisfied  by mid-1998)  was used by the Company to pay a portion
of the delinquent  real estate taxes,  to implement its marketing  programs,  to
initiate  development  of TimberWalk and to meet the Company's  working  capital
requirements.

The  Company  was  the  guarantor  of  approximately  $13,673,000  of  contracts
receivable  sold or  transferred  as of March  31,  1997,  for the  transactions
described  above and had $121,000 on deposit with  purchasers of the receivables
as  security to assure  collectibility  as of such date.  A  provision  has been
established for the Company's  obligation under the recourse provisions of which
$3,188,000  remains at March 31, 1998.  The Company has been in compliance  with
all receivable transactions since the consummation of receivable sales.

In the  future,  if the Company  elects to do so,  Yasawa and  Scafholding  have
agreed to purchase contracts receivable at 65% of face value, with recourse,  to
meet the Company's ongoing capital requirements.

     OTHER OBLIGATIONS

As of March 31,  1998,  the Company had  estimated  development  obligations  of
approximately  $25,000 on sold property, an estimated liability to provide title
insurance  and  deeding  costing  $557,000  and  an  estimated  cost  of  street
maintenance,  prior to assumption of such obligations by local  governments,  of
$429,000,  all of which are  included  in  deferred  revenue.  The total cost to
complete  improvements  at March  31,  1998 was  estimated  to be  approximately
$1,011,000. As of March 31, 1998 the Company had in escrow approximately $50,000
specifically  for land  improvements at certain of its Central and North Florida
communities.  The Company's development  obligation was substantially reduced in
1997 by the  consummation  of the  Agreement  approved  by the  stockholders  on
November 4, 1997.  Approximately $7,400,000 of the development obligation at St.
Augustine  Shores was  assumed  by Swan.  In  addition,  the  creation  of a Lot
Exchange Trust reduced the development obligation at Marion Oaks and Sunny Hills
by approximately $ 5,800,000.

The Company's continuing liquidity problems have precluded the timely payment of
the  full  amount  of its  real  estate  taxes.  Delinquent  real  estate  taxes
aggregated  approximately  $1,689,000 as of March 31, 1998. On properties  where
customers  have  contractually  assumed the  obligation to pay into a tax escrow
maintained by the Company,  the Company has and will continue to pay  delinquent
real estate taxes as monies are collected from  customers.  Of the $1,689,000 in
delinquent  real estate  taxes,  approximately  $48,000  relates to sold lots on
which the customer has assumed the obligation to pay but has not done so.

     LIQUIDITY

Retail land sales have  traditionally  produced  negative  cash flow through the
point of sale as a result of the regulatory  requirement to sell fully developed
lots and the additional  requirement to pay marketing and selling expenses prior
to or shortly  after the point of sale. In an effort to offset the negative cash
effects of installment  land sales,  the Company is now attempting to direct its
marketing  efforts  to  selling  homes and lots  together.  The  success of this
direction will be dependent upon the Company's dealer recruiting program and the
availability of funds for an advertising and promotion program.


In December 1997, the Company  announced the start of construction on its newest
housing  development:  TimberWalk.  TimberWalk  will feature a model home center
with models built by three premier central Florida home builders. At TimberWalk,
home  buyers  will  enjoy the  benefits  of  Deltona's  newest  design  concept,
"Everything  Included",  which includes features that are often considered extra
cost   upgrades  and  options  by  other  home  builders  but  are  included  in
TimberWalk's  basic  prices.  Models will range from one to two story homes with
two, three or four bedrooms ranging in size from 1,200 square feet to over 2,200
square feet of living space.

Due to its  liquidity  problems  over the last five years,  the Company has
been forced to delay payment of certain real estate taxes. The Company's ability
to continue retail land sales and  re-establish  itself in the housing  business
will be

                                       14
<PAGE>

substantially  dependent  on its  ability  to  sell  or  otherwise  finance
contracts  receivable  and/or  secure other  financing  sources to meet its cash
requirements. Since 1992, the Company has been largely dependent upon Yasawa and
related parties for financing of its operations. Although Yasawa and Scafholding
have   committed  to  provide  the  Company  with  financing  of  its  contracts
receivables  at the rate of 65% of face value,  with  recourse,  there can be no
guarantee  that the Company will be able to generate  sufficient  receivables to
meet its cash flow requirements.

     YEAR 2000

The  Company  utilizes  a number of  software  systems in  conjunction  with its
community  development,  contract processing and contract servicing  operations.
The Company has and will  continue to make certain  investments  in its software
systems  and  applications  to ensure the  Company is Year 2000  compliant.  The
financial  impact  of  becoming  Year  2000  compliant  has not  been and is not
expected  to be  material  to the  Company's  financial  position  or results of
operations in a given year.



                                       15
<PAGE>


                           PART II - OTHER INFORMATION
                           ===========================



Item 6.   EXHIBITS AND REPORTS ON FORM 8-K.

          (a)  Exhibits

               None.

          (b)  Reports on Form 8-K

               A Report on Form 8-K was filed by the Company on April 7, 1998.

                                       16
<PAGE>


                                    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 thereunto duly authorized.



                                             THE DELTONA CORPORATION



Date: May 15, 1998                           By: /s/Donald O. McNelley
      ------------                               ------------------------------
                                                 Donald O. McNelley
                                                 Treasurer
                                                 (Principal Financial Officer)



                                       17