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    September 30, 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                  1-1212
                           --------------------------------------------
                            Driver-Harris Company
 ----------------------------------------------------------------------
          (Exact name of registrant as specified in its charter)

     New Jersey                                    22-0870220
-------------------------                --------------------------
(State or other jurisdiction of               (I.R.S. Employer
incorporation or organization)              Identification No.)

      308 Middlesex Street, Harrison, New Jersey        07029
-------------------------------------------------------------------  
(Address of principal executive offices)             (Zip Code)

Registrant's telephone no., including area code  (973) 483-4802
                                             ------------------

    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 ________

    Indicate the number of shares outstanding of each of the issuer's 
classes of common stock, as of the latest practicable date.

    Common Stock, $0.83 1/3 par value -- 1,343,671 shares as of November 
9, 1998.        
<PAGE>


                        DRIVER-HARRIS COMPANY

                              I N D E X


PART I FINANCIAL INFORMATION                                PAGE
-----------------------------                               ----
Item 1.  Financial Statements

     Condensed Consolidated Balance Sheets
     September 30, 1998 and December 31, 1997. . . . . . . .  3

     Condensed Consolidated Statements of
     Income - Three and Nine Months ended September 30,    
     1998 and September 30, 1997 . . . . . . . . . . . . . . .4

     Condensed Consolidated Statements of Cash Flows -
     Nine Months ended September 30, 1998 and 
     September 30, 1997 . . . . . . . . . . . . . . . . . . . 5

     Notes to Financial Statements. . . . . . . . . . . . . . 6

Item 2.  Management's Discussion and Analysis of
     Financial Condition and Results of Operations . . . . . .6

PART II  OTHER INFORMATION
---------------------------
Item 6.  Exhibits and Reports on Form 8-K.
(a) Exhibits
         Exhibit 27 - Financial Data Schedule
     (b) Reports on Form 8-K
  	    None filed in quarter
     
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . .7
----------


<PAGE>

         DRIVER-HARRIS COMPANY AND SUBSIDIARIES
                CONDENSED CONSOLIDATED BALANCE SHEETS
                       (Amounts in thousands)

                                            September 30,   December 31,
                                                1998         1997
                                            ------------   ------------
<TABLE>
ASSETS                                       (Unaudited)
Current assets:   
<S>                                          <C>           <C>  
Cash                                         $   262       $    848
Accounts receivable - net                      9,549          9,325
Inventories:
     Materials                                   721            536
     Work in process                             245            254
     Finished products                         3,153          3,920
                                               -----         ------
                                               4,119          4,710
Prepaid expenses                                 666            497
                                               -----         ------ 
Total current assets                          14,596         15,380

Other assets                                       6             16
Property, plant & equipment - net              5,373          5,328
                                              ------         ------   	
		                                           $19,975       $ 20,724
                                              ======         ======
LIABILITIES		
Current Liabilities:
     Short-term borrowings                   $ 3,224       $  4,179
     Current portion of long-term debt           575            515
     Accounts payable                          6,016          5,176
     Accrued expenses                          2,049          1,293
     Income taxes payable                         37            108
                                              ------         ------
Total current liabilities                     11,901         11,271 

Long-term debt                                 2,294          2,524
Deferred Grants                                  826            796
Deferred foreign income taxes                    156            147
Postretirement benefit liabilities               554            574
Sundry liabilities 	                        				 121		          149 

Stockholders' equity:
     Common stock                              1,226          1,223
     Additional paid-in capital                2,258          2,228
     Retained earnings                         1,557          3,030 
     Accumulated other comprehensive loss       (918)        (1,218)        
                                              ------          -----
Stockholders' equity                           4,123          5,263
                                               -----          -----
                                             $19,975       $ 20,724
                                              ======         ======
</TABLE>
See accompanying notes.
<PAGE>
                   DRIVER-HARRIS COMPANY AND SUBSIDIARIES
            UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF LOSS
            (Dollar amounts in thousands, except per share data)
                     					  
                             

                            THREE MONTHS ENDED         NINE MONTHS ENDED 
                         					SEPTEMBER 30          		   SEPTEMBER 30
                            1998         1997          1998      1997
                            ----         ----           ----      ----
<TABLE>
<S>                        <C>         <C>            <C>       <C>
Net sales                  $10,972     $ 9,411        $30,082   $30,725
Other revenues                  37          23            134       237
                            ------       -----          -----    ------
Total Revenues              11,009       9,434         30,216    30,962
Cost of sales 	              9,720       8,571         27,003    26,769
 				                       ------      ------         ------    ------
 				                        1,289         863          3,213     4,193
Selling, general and
     administrative expenses 1,491       1,437          4,186     4,712
 				                       ------      ------         ------    ------
                              (202)       (574)          (973)     (519)

Other charges (credits):
Interest                       178         202            541       502
Foreign exchange (gain) loss   (12)         17            (41)     (231)
Gain on sale of interest in
  Australian subsidiary                   (128)                    (128)
                             -----       -----          -----     -----
Loss before income taxes      (368)       (665)        (1,473)     (662)  

Income taxes (credit)            -         (60)             -        21
                             -----       -----          -----     -----
NET LOSS                    $ (368)     $ (605)       $(1,473)   $ (683) 
                             =====       =====          =====     =====


BASIC NET LOSS PER SHARE     $(.28)     $(.45)         $(1.10)   $(.51) 
                   				       ====       ====           ====      ====
DILUTED NET LOSS PER SHARE   $(.27)     $(.45)         $(1.09)   $(.51)
				                        	 ====       ====           ====      ====


Basic earnings per share-
  weighted average shares    1,343,671   1,340,421	1,342,046  1,340,421 
Diluted earnings per share-
  weighted average shares    1,349,044   1,353,817    1,355,220  1,349,880

</TABLE>

See accompanying notes.
<PAGE>







                     DRIVER-HARRIS COMPANY AND SUBSIDIARIES
           UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
                         (Amounts in thousands)

                                                     NINE MONTHS ENDED
                                                       September 30
                                                     ----------------
                                                      1998       1997
                                                      ----       ----	
<TABLE>
	  OPERATING ACTIVITIES
   <S>                                              <C>        <C>
   Net loss                                         $(1,473)   $ (683)
     Adjustments to reconcile net income                     
       to net cash provided:
          Depreciation and amortization                 411       441
          Receivables                                  (224)   (1,096)
          Inventories                                   895    (1,196)
          Accounts payable and accrued expenses       1,198     2,531  
          Sundry                                        (28)      158
                                                    -------    ------
     CASH PROVIDED BY(USED IN) OPERATING ACTIVITIES     779       155

INVESTING ACTIVITIES
         Capital expenditures                          (208)   (1,287)
         Sundry                                          16        34
                                                     ------    ------
                                                                 
     CASH USED IN INVESTING ACTIVITIES                 (192)   (1,253)

FINANCING ACTIVITIES
          Change in deferred grants                     (33)      140 
          Change in short-term debt                  (1,095)      333 
          Issuance of long-term debt                     31     1,039
          Reduction of long-term debt                  (326)     (206)
          Sundry                                         34        30
                                                     ------     -----	
CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES      (1,389)    1,336 

Effect of exchange rate changes on cash                 216         9
                                                     ------     -----
Net change in cash                                     (586)      247 
Cash at beginning of year                               848       402
                                                     ------     -----	
	         
     CASH AT END OF PERIOD                          $   262   $   649
                                                     ======     =====	
	      
</TABLE>
See accompanying notes.                 
<PAGE>





NOTES TO FINANCIAL STATEMENTS

1 - Basis of Presentation
     These financial statements have been prepared in accordance 
with the instructions to Form 10-Q and therefore do not include 
all information, disclosures, and notes necessary for a fair 
presentation of financial position, results of operations, and 
cash flows in conformity with generally accepted accounting 
principles.  Reference should be made to the financial statements 
contained in the Company's Annual Report on Form 10-K for the year 
ended December 31, 1997.  These financial statements include all 
adjustments which are, in the opinion of management, necessary to 
a fair presentation of the results for the interim period.


2 - Investments in Related Company and other subsidiaries
     The Company owns Irish Driver-Harris Co. Ltd.,("IDH"), 
located in Ireland and the U.K.  The Company also owns 50% of 
Harrison Alloys Inc. ("Harrison") which is carried at zero value 
on its balance sheet.  Although Harrison is required to pay to the 
Company license fees and commissions totaling $500,000 per year to 
2003, no payments have been received since December 1996.  Income 
from Harrison will not be recorded until amounts are received.

3 - Comprehensive Income
	As of January 1, 1998, the Company adopted Financial 
Accounting Standard 130, Reporting Comprehensive Income.  
Statement 130 establishes new rules for the reporting and display 
of comprehensive income and its components; however, the adoption 
of this Statement had no impact on the Companys net (loss) income 
or stockholders equity.  Statement 130 requires foreign currency 
translation adjustments, which prior to adoption were reported 
separately in shareholders' equity, to be included in other 
comprehensive income.  Prior year financial statements have been 
reclassified to conform to the requirements of Statement 130.

	The components of comprehensive income for the nine month 
periods ended September 30, 1998 and 1997 are as follows:
<TABLE>
							                      		            1998        	1997
 <S>                                     <C>         <C>
	Net loss              					             $(1,473)    $  (683)
	Foreign currency translation adjustment     300      (1,134)
						                                  			-----     		-----
	Comprehensive loss                      $(1,173)    $(1,817)
</TABLE>

<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
RESULTS OF OPERATIONS

Financial Condition
Harrison continues to restructure its operations and as 
such, the Company does not contemplate that amounts due under the 
license agreements will be paid in the near future.  The Company 
believes it has adequate cash and other options available in the 
foreseeable future should these amounts ultimately not be fully 
collected.

Results of Operations
Although net sales to customers decreased by 2.1% during the 
first nine months of 1998 compared to the same period in 1997, 
1997 included $1,060,000 in sales from the Australian subsidiary, 
which was sold in the third quarter of 1997.  Net sales for the 
quarter increased by 16.6% compared to 1997.  Also, the foreign 
rate impact of the value of the Irish Punt to the U.S. Dollar 
resulted in a 5.5% decrease in translated sales for the nine 
months of 1998 compared to 1997. Units shipped increased by 12.9% 
over the same period in 1997 while the gross profit percentage 
increased to 11.4% compared to 8.9% in 1997.  Pressure on selling 
prices from aggressive competition within the cable industry, 
particularly in the U.K., the Company's primary market, continues 
to impact margins for the nine months of 1998.  Since no fees from 
Harrison have been recorded since the first quarter of 1997, other 
revenues for the nine months are down. Selling, general and 
administrative expenses decreased to 13.9% of net sales in 1998 
compared to 15.2% in the nine months of 1997.  These expenses were 
high in 1997 due to start-up costs at a new production facility in 
Ireland and restructuring costs at the U.K. distribution company.

Income taxes for 1997 result from foreign taxable income at 
the Company's Irish subsidiary. The Company has tax loss 
carryforwards of approximately $6,400,000 available to offset 
future U.S. taxable income, which expire between 1999 and 2010.

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.

                                	DRIVER-HARRIS COMPANY




Date: November 12, 1998                    By:   Thomas J. Carey
---------------------				                 ------------------------ 
                               							    Chief Financial Officer