UNITED STATES
                   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 ended December 31, 1996 

                                  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:  0-8125


                      ----------------------------


                        DETECTION SYSTEMS, INC.
         (Exact name of registrant as specified in its charter)


State of New York                                16-0958589
(State or other jurisdiction                     (I.R.S. Employer
of incorporation or organization)                Identification No.)

130 Perinton Parkway, Fairport, New York         14450
(Address of principal executive offices)         (Zip Code)

(716) 223-4060
       (Registrant's telephone number, including area code)

                     ----------------------------


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
the filing requirements for the past 90 days.    Yes __X__    No _____


As of February 7, 1997, there were outstanding 4,467,380 shares of the
registrant's common stock, par value $.05 per share.


PART I FINANCIAL INFORMATION
DETECTION SYSTEMS, INC. AND SUBSIDIARIES
Consolidated Balance Sheet (Unaudited)

              <TABLE>
<S>                                       <C>            <C>
ASSETS                                    Dec. 31, 1996  Mar. 31, 1996
Current Assets:                           -------------  -------------
   Cash & cash equivalents               $ 889,982  $   913,716
   Short-term investments, at cost, 
    which approximates market value          16,626       16,296
   Accounts receivable, less allowance
    for doubtful accounts of $100,000    14,704,990   10,482,660
   Inventories                           24,243,171   14,065,843
   Income tax receivable                    435,471      532,895
   Deferred income tax charges            1,554,900    1,554,900
   Prepaid expenses and other assets      1,149,485      860,018
                                        -----------  -----------
 Total Current Assets                    42,994,625   28,426,328

Fixed assets at cost                     19,130,237   16,767,326
  Less accumulated depreciation          11,485,272    9,681,969
                                        -----------  -----------
                                          7,644,965    7,085,357

Property under capital lease              4,714,854    4,760,810
  Less accumulated depreciation           2,367,276    2,269,335
                                        -----------  -----------
                                          2,347,578    2,491,475

Deferred Income Taxes                     3,983,200    3,983,200
Goodwill and other intangibles            4,140,438    3,762,327
Other assets                                636,878      148,891
                                        -----------  -----------
Total Assets                             61,747,684   45,897,578

LIABILITIES
Current Liabilities
 Current portion of long-term debt
   and capital lease obligations            123,924      559,860
 Accounts payable                        11,332,659    6,231,737
 Accrued payroll & benefits               2,921,187    1,566,777
 Short term borrowings                    6,441,450    1,183,750
 Other accrued liabilities                2,923,237    3,171,914
                                        -----------  -----------
 Total Current Liabilities               23,742,457   12,714,038

Obligations under capital leases             94,618      186,471
Other long term liabilities               1,931,900    1,931,900
Long term debt                           17,750,000   17,750,000
Deferred compensation                     1,729,217    1,745,886
Shareholders' Equity
Common stock, par value $.05 per share
  Authorized 12,000,000 shares
  Issued 4,456,430 shares at 12/31/96
  and 2,811,361 shares at 3/31/96           222,869      140,568
Capital in excess of par value            9,338,306    6,964,570
Retained earnings                         7,361,705    4,869,022
                                         ----------   ----------
                                         16,922,880   11,974,160
Less: Treasury stock, 2,487 at 12/31/96 
  at cost and 2,207 shares at 3/31/96       (38,777)     (12,363)
  at cost)
Notes receivable for stock purchases       (384,611)    (392,514)
                                          ----------  -----------
                                         16,499,492   11,569,283
                                        -----------  -----------
Total Liabilities & Shareholders' 
     Equity                             $61,747,684  $45,897,578
                                        ===========  ===========
                                    
            See accompanying notes to financial information.
                                    
</TABLE>
                                    
                DETECTION SYSTEMS, INC. AND SUBSIDIARIES
                Consolidated Income Statement (Unaudited)
                                                                         
<TABLE>
<S>                           <C>           <C>
For the Three Months Ended:    Dec. 31, 1996 Dec. 31, 1995
                              (Current Year) (Preceding Year)
                              -------------- ---------------
Gross sales less discounts,
         returns and allowances  $26,441,837  $ 8,563,799
Other revenue                         54,270       38,228
                                  ----------   ----------
Total revenue                     26,496,107    8,602,027

Costs and expenses:
         Production               17,366,386    5,991,708
         Development               2,046,418    1,094,505
         Marketing, admin. & gen.  5,165,390    2,164,194
         Interest expenses           464,645       42,435
                                  ----------   ----------
Total costs and expenses          25,042,839    9,292,842

Income (loss) before taxes         1,453,268    (690,815)

Provision for (benefit from) taxes   379,000     (95,000)
                                  ----------   ----------
Net (loss) income                  1,074,268    (595,815)

Retained earnings at beginning 
  of period                       $6,287,437  $12,821,776

Dividends                               none         none

Retained earnings at end 
   of period                      $7,361,705  $12,225,961

  Net Income (Loss) Per Share          $0.22      ($0.14)
                                       =====       =====
          (See accompanying notes to financial information)

</TABLE>
<TABLE>
                DETECTION SYSTEMS, INC. AND SUBSIDIARIES
                Consolidated Income Statement (Unaudited)

<S>                           <C>             <C>
For the Nine Months Ended:     Dec. 31, 1996  Dec. 31, 1995
                              (Current Year)  (Preceding Year)
                              --------------  --------------
Gross sales less discounts,
         returns and allowances  $74,485,802  $26,654,524
Other revenue                        106,039      204,735
                                  ----------   ----------
Total revenue                     74,591,841   26,859,259

Costs and expenses:
         Production               49,309,576   17,134,401
         Development               5,803,833    3,091,647
         Marketing, admin. & gen. 14,635,291    6,660,589
         Interest expenses         1,332,458      139,926
                                  ----------   ----------

Total costs and expenses          71,081,158   27,026,563

Income (loss) before taxes         3,510,683    (167,304)

Provision for taxes                1,018,000      331,000
                                  ----------   ----------
Net income (loss)                  2,492,683    (498,304)

Retained earnings at beg.
   of period                     $ 4,869,022  $12,724,265

Dividends                               none         none

Retained earnings at end of period $7,361,705  $12,225,961
                                   ==========   ==========

Net Income (Loss) Per Share            $0.52       ($0.10)
                                         ====        ==== 
                                    
            (See accompanying notes to financial information)

</TABLE>

<TABLE>
                DETECTION SYSTEMS, INC. AND SUBSIDIARIES
            Consolidated Statement of Cash Flows (Unaudited)
<S>                                     <C>          <C>
For the Nine Months Ended December 31,  1996         1995
                                        ----         ----
Cash Flows from Operating Activities:
Net (loss) Income                       $2,492,683   ($498,304)

Adjustments to reconcile net income
   to net cash provided by operating
   activities:
   Depreciation and amortization         1,901,244    1,196,270
   Fixed asset retirements                       0        2,682
         Change in obsolescence reserve     50,000            0
         Deferred compensation            (16,669)      194,633
Change in assets and liabilities:
         Accounts receivable           (4,222,330)  (1,018,931)
         Inventories                  (10,227,328)  (3,108,333)
         Income tax receivable              97,424    (749,440)
         Prepaid expenses and other 
           assets                        (289,467)    (196,544)
         Accounts payable                5,100,922      887,662
         Accrued payroll and benefits    1,354,410    (377,721)
         Other accrued liabilities       (248,677)       23,388
         Deferred income taxes                   0     (73,900)
         Goodwill and other assets       (866,098)            0
                                        ----------   ----------
         Total adjustments             (7,366,569)  (3,220,234)
                                        ----------   ----------
Net cash used in operating 
         activities                    (4,873,886)  (3,718,538)

Cash flows from investing activities: 
         Capital expenditures          (2,316,955)  (2,872,006)
         Short-term investments              (330)    2,437,842
                                        ----------   ----------
Net cash used in investing activities  (2,317,285)    (434,164)

Cash flows from financing activities:
  Proceeds from short term borrowings    5,257,700      850,000
  Proceeds from private equity placement 2,000,005            0
  Principal payments on long-term debt and
  capital lease obligations              (527,789)    (341,925)  
Common stock transactions                  437,521      215,686
                                        ----------   ----------
Net cash provided by financing 
     activities                          7,167,437      723,761

Net increase(decrease) in cash and 
         cash equivalents                 (23,734)  (3,428,941)

Cash and cash equivalents at beginning 
         of period                         913,716    4,580,751
                                        ----------   ----------
Cash and cash equivalents at end
         of period                        $889,982   $1,151,810
                                        ==========   ==========
Cash paid during the period for:
         Interest                          976,235       36,216
         Income taxes                      585,155    1,090,327

Noncash transactions:
The Company considers all highly liquid investments with a maturity of three
months or less to be cash equivalents.

            See accompanying notes to financial information.
                                    
</TABLE>

                DETECTION SYSTEMS, INC. AND SUBSIDIARIES
                     NOTES TO FINANCIAL STATEMENTS
                        NINE-MONTH PERIOD ENDED
                           December 31, 1996
                              (Unaudited)
                                    

BASIS OF PRESENTATION:

The accompanying unaudited financial statements have been prepared in
accordance with the instructions to Form 10-Q and, therefore, do not include
all information and footnotes which are normally included in Form 10-K and
the annual report to shareholders.  The financial statements reflect all
adjustments which, in the opinion of management, are necessary for a fair
statement of results for the interim periods.


INVENTORIES

         Major classifications of inventory follow:

                          Dec. 31 1996  March 31, 1996
                         -------------  --------------
Component Parts             15,299,612       6,408,670
Work In Process                798,250         705,473
Finished Products            8,145,309       6,951,700
---------                    ---------
                            24,243,171      14,065,843
                            ==========       =========


                DETECTION SYSTEMS, INC. AND SUBSIDIARIES
             MANAGEMENT'S DISCUSSION OF FINANCIAL CONDITION
                       AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

Late in fiscal 1995, the Company launched a major initiative to extend its
market reach on a world wide basis.  Since that time sales offices have been
opened in Australia, France, Hong Kong, China and the United Kingdom, in
addition to the establishment of distribution arrangements in over 25
additional countries.  As part of an effort to expand its product catalog,
Detection Systems purchased Radionics for approximately $18 million in
February 1996.  This acquisition had a significant impact on the comparative
information for the three and nine month periods ended December 31, 1996
versus the same periods ended December 31, 1995, both for the results of
operations as well as for asset and liability balances.

Net sales for the three and nine month periods ended December 31, 1996
increased $17.9 million and $47.8 million, respectively, as compared to the
same periods one year ago.  Net sales for the three and nine month periods
ended December 31, 1995 as compared to the same periods ended December 31,
1994, decreased $.9 million and increased $.4 million, respectively. The
addition of Radionics and the growth of sales since the acquisition
accounted for $13.7 million and $38.6 million, respectively, of the 1996
increases.  International sales increased substantially for the three and
nine month periods ended December 31, 1996, as compared with the same
periods a year ago.  Sales have also benefited from the Company's broader
customer base and the synergies associated with the combined companies.  The
decrease in net sales for the three month period ended December 31, 1995
versus the three month period ended December 31, 1994 was due to a change in
national account sales activity.  The increase for the nine months ended
December 31, 1995 versus the same period ended December 31, 1994 was
attributable to the growing international business.  

Gross profit margins on sales improved for the three month period ended
December 31, 1996 as compared with the three month period ended December 31,
1995.  This reflected cost savings associated with the transitioning of a
portion of Detection Systems' and Radionics' product manufacturing to the
Company's Southeast Asia facility.  Additional savings resulted from the
Company's increased purchasing base. Gross profit margins declined in the
nine month period ended December 31, 1996 compared to the equivalent year
ago period.  This resulted from expenses associated with the start up of the
Southeast Asia manufacturing facility. The Company believes gross profit
margins should continue to improve as a result of the more efficient use of
its Southeast Asia facility.  Margins should also be positively impacted by
several negotiated cost improvements which took effect late in the second
quarter.  Gross profit margins on sales for the three and nine month periods
ended December 31, 1995 versus the same periods ended December 31, 1994
declined because of expenses associated with the startup of the Southeast
Asia facility.

Other income increased slightly for the three month period ended December
31, 1996 and declined by 48.2% for the nine month period ended December 31,
1996 as compared to the prior year ago periods.  The increase was
attributable to the timing of investments during the quarter.  The decrease
represents the Company's reduction in amounts available for investments. 
Other income also decreased for the three and nine month periods ended
December 31, 1995 as compared with the equivalent year ago periods, due to
decreases in funds available for investment.

Production expenses increased $11.4 million and $32.2 million for the three
and nine month periods ended December 31, 1996 as compared to the three and
nine month periods ended December 31, 1995.  These increases were primarily
attributable to Radionics' cost of sales and other manufacturing costs.  The
transitioning of manufacturing among the Company's manufacturing facilities
in New York, California and Southeast Asia has continued to increase total
production costs.  However, these costs should diminish as the transitioning
is completed.  Production expenses for the three and nine month periods
ended December 31, 1995 increased 5.9% and 7.5% as compared with the
equivalent year ago periods.  These increases were primarily attributable to
the start up of the Southeast Asia manufacturing facility.

Development expenses increased $1.0 million and $2.7 million for the three
and nine month periods ended December 31, 1996 as compared with the same
periods in the prior year.  These increases were primarily attributable to
the Company's acquisition of Radionics and the associated expansion of the
Company's research and development efforts.  The increases also include the
cost of transitioning Radionics' California-based engineering function to
the Company's New York, facility.  The Company expects to spend between $7.5
million and $8.0 million on research and development efforts in fiscal 1997. 
Development expenses for the three and nine months ended December 31, 1995
remained consistent with those for the prior year periods.

Marketing, administrative and general expenses for the three and nine month
periods ended December 31, 1996 versus the comparable periods ended December
31, 1995, increased by $3.0 million and $8.0 million, respectively.  These
increases were primarily due to the acquisition of Radionics.  They were
impacted to a lesser extent by the Company's international sales initiative. 
The increases of $.4 million and $1.6 million for the three and nine months
periods ended December 31, 1995 versus the comparable year ago periods were
also primarily due to the Company's international start up.

Interest expense increased approximately $.4 million and $1.2 million for
the three and nine months ended December 31, 1996 compared to the equivalent
periods one year ago.  These increases were due to the debt financing of the
Radionics' acquisition.  In addition, the Company has increased its
inventory levels during the third fiscal quarter of this year to meet
customer demand which was partially financed through borrowings from the
Company's line of credit.  Interest expense increased slightly for the three
and nine month periods ended December 31, 1995 versus the same periods ended
December 31, 1994.  These increases were due to temporary working capital
borrowings utilized during the year.

Income before taxes was $1,453,000, -$691,000 and $912,000 for the three
month periods ended December 31, 1996, 1995 and 1994, respectively.  For the
nine month periods ended December 31, 1996, 1995 and 1994, income before
taxes was $3,511,000, -$167,000 and $2,362,000.  Results in 1996 improved
compared to 1995 due to higher sales volumes and reduced costs associated
with international operations.  Results in 1995 as compared to 1994
decreased due to the full expensing of the Company's international start-up
costs.

The Company's effective tax rates for the three and nine month periods ended
December 31, 1996 were 26.1% and 29.0%, respectively.  The lower tax rates
reflect the utilization of loss carryforwards for last fiscal year on losses
derived on international operations as well as more favorable tax rates
associated with the Company's Southeast Asia operations.  The comparative
effective tax rates for the three and nine months ended December 31, 1995
were 13.8% and 197.8%, respectively.  These higher rates are reflective of
the Company's inability to utilize certain subsidiary losses during
consolidation.  The Company's effective tax rates for the three and nine
months ended December 31, 1994 were 37.6% and 37.0%, respectively.  These
rates were reflective of the statutory rates in effect for the Company's
domestic operations.


FINANCIAL CONDITION

At December 31, 1996, the Company had net working capital of $19.3 million,
including approximately $.9 million in cash, cash equivalents and short term
investments.  This compares to net working capital of approximately $15.7
million including $.9 million in cash, cash equivalents and short term
investments at March 31, 1996.  Operations for the nine month period ended
December 31, 1996 used net cash of approximately $4.9 million.

The Company had a $6.5 million bank commitment for a revolving line of
credit facility that extends into fiscal 1999.  This commitment includes an
interest rate based on the London Interbank Offered Rate plus applicable
points based on the Company's performance.  The balance becomes fully due
and payable on May 31, 1998.  At December 31, 1996, the Company had short
term borrowings of $6.4 million from this line of credit.  Effective January
27, 1997, the Company's line of credit was increased to $11.5 million.  The
Company secured an additional $5.5 million revolving line of credit which
mirrors the provisions and covenants of the initial $6.5 million facility. 
The Company believes that current levels of cash, cash equivalents and short
term investments, together with its available line of credit, will meet its
foreseeable working capital needs.

In October of 1996, the Company sold approximately 114,000 shares of its
common stock for $2.0 million to five corporate pension funds.  The proceeds
from this private placement were used for working capital to fund the
Company's current growth. 

The Company expects to continue expenditures on the development of new
products and markets.  These expenditures will include continued investment
in security detection, fire detection, access control and CCTV products. 
The Company's effort to market its products internationally will continue as
well.

To meet customer demand for its products, the Company added a third
production line to its Southeast Asia manufacturing facility in October of
1996 and expects to have a fourth production line operational by the end of
February 1997.  Funding for these expenditures have and will be financed
through the Company's revolving line of credit facility.

At December 31, 1996, accounts receivable increased 40.3% from the March 31,
1996 level.  This increase was attributable to the higher sales volume
achieved during the third fiscal quarter.  The Company's standard credit
terms are net 30 days, with variations depending on volume, pricing and
prepayment discounts.

Inventories increased 72.4% at December 31, 1996 as compared to March 31,
1996.  This increase was primarily attributable to the transition of
manufacturing to the Company's Southeast Asia facility, while maintaining
production capability in the Company's domestic manufacturing facilities in
Fairport, NY, and Salinas, CA.  In addition, the Company has initiated an
inventory build up plan to allow it to better meet its customers increasing
product needs.

Prepaid expenses and other assets increased by approximately $289,000 from
the March 31, 1996 level.  This increase was attributable to prepayment of
premiums for certain benefits.

At December 31, 1996, accounts payable increased 81.9% as compared to the
March 31, 1996 level.  This increase is the result of a tighter cash
management program and payment terms more reflective of the industry
average.

Accrued payroll and benefits increased by $1,354,000 at December 31, 1996
versus the March 31, 1996 level.  This increase was attributable to the
accrual of performance bonuses for fiscal 1997.

Other accrued liabilities at December 31, 1996, remained consistent with the
March 31, 1996 level.

On November 8, 1996, the Company announced a 3 for 2 stock split.  The stock
distribution was made on December 17, 1996 to shareholders of record as of
November 27, 1996.  Fractional shares were paid in cash.  After the split,
approximately 4,450,000 shares of common stock were outstanding. 
                                    
                       PART II OTHER INFORMATION
                                    
                                    
Item 1.  Legal Proceedings

         Not applicable

Item 4.  Submission of Matters to a Vote of Security Holders.

         Not applicable
         

Item 5.  Other matters

In October of 1996, the Company sold approximately 114,000 common
shares for $2.0 million to five corporate pension funds.  The proceeds
of this private placement will be used for working capital.  A Form S-
3 registration statement was subsequently filed with respect to the
registration of these shares.
         
In consideration for services rendered in conjunction with the above
private placement, the Company granted a 1,500 share warrant (post-
split) on November 7, 1996 to purchase its common stock at a per share
price that approximated fair market value on the date of award.  Said
shares are exercisable in full or in part over a 5-year period upon
payment of the purchase price.  These securities have been been
registered with the Securities and Exchange Commission in reliance
upon exemption by Section 4(2) of the Securities Act of 1933.  The
total cost for the warrant was $20,250.   

On November 7, 1996, the Company's Board of Directors approved a 3 for
2 stock split in the form of a stock distribution of one share for
every two shares owned.  The stock distribution will be made on
December 17, 1996 to shareholders of record as of November 27, 1996. 
Fractional shares were paid in cash.  After the split, approximately
4,450,000 shares of common stock were outstanding. 

Item 6.  Exhibits and Reports for Form 8-K.

         A. Exhibits

              See Exhibit Index

         B.   Reports on Form 8-K

              No reports on Form 8-K were filed during the quarter ended 
              December 31, 1996.

SIGNATURES

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.

                                       DETECTION SYSTEMS, INC.
                                       Registrant

DATE:  February 14, 1997               By: /s/ Karl H. Kostusiak
                                       Karl H. Kostusiak, President


                                       By: /s/ Frank J. Ryan
                                       Frank J. Ryan, Vice President,
                                       Secretary and Treasurer
                                  (Chief Financial & Accounting Officer)


EXHIBIT INDEX
    
    (3i) Text of the Certification of Incorporation, as amended.
              Incorporated by reference to Exhibit 3a to the registrants
              Form 10-K dated June 25, 1993.

    (3i) Certificate of Amendment of Certificate of Incorporation
              as filed with New York Secretary of State.  Incorporated
              by reference to Exhibit 3a to the registrants Form 10-K
              dated June 25, 1993.

    (3ii)     The text of the registrant's By-laws, as amended, are
              incorporated by reference to Exhibit 3b to the Company's
              Report on Form 10-K dated June 25, 1993.

    (10) Executive Employment Agreements are incorporated by
              reference to Exhibit 10 of the registrant's Report on Form
              10-K/A dated July 12, 1996.

    (11) Statement regarding computation of per share earnings. 
              See Exhibit 11.
    
    (27) Financial data schedule.  Included as Exhibit 27 to
              electronic Edgar filing only.
    
<TABLE>
Exhi                                     bit 11

DETE              CTION SYSTEMS, INC. AND SUBSIDIARIES

            Consolidated Computation of Net Income Per Common 
                         And Common Equivalent Share

<S>                              <C>            <C>
For the Three Months Ended:      Dec. 31, 1996  Dec. 31, 1995

Net Income                          $1,074,268  ($595,815)
ADD - Interest on deferred 
    compensation                        17,319      15,550
                                       -------    --------
Adjusted net income applicable to 
         common stock               $1,091,587  ($580,265)

Number of Shares:
Weighted average number of shares    4,451,985   4,208,081
    Common Stock equivalent due to       
    assumed exercise of stock options
    and warrants and deferred compensation
    plan shares                        582,297           0
                                     ---------   ---------
                                     5,034,282   4,208,081

Net Income per Common and Common
Equivalent share                         $0.22     ($0.14)




For the Nine Months Ended:        Dec. 31,1996  Dec. 31,1995

Net Income                          $2,492,683  ($498,304)
ADD - Interest on deferred
    compensation                        49,845     50,692
                                       -------   ---------
Adjusted net income applicable to 
         common stock               $2,542,528  ($447,612)

Number of Shares:
Weighted average number of shares    4,323,032   4,208,081
         Common Stock equivalent due to
         assumed exercise of stock options
         and warrants and deferred compensation
         plan shares                   563,242     118,057
                                     ---------   ---------
                                     4,886,274   4,326,138

Net Income per Common and Common
Equivalent share                         $0.52     ($0.10)



</TABLE>