SECURITIES AND EXCHANGE COMMISSION

                     WASHINGTON, D. C.  20459

                            FORM   10-Q

       QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE
                     SECURITIES EXCHANGE ACT OF 1934


 For Quarter Ended   December 31, 1995    Commission File Number I-4383  


                  ESPEY MFG. & ELECTRONICS CORP.                 
       
        (Exact name of registrant as specified in charter)        
                                                                  
    

        NEW YORK                                   14-1387171        
       
 (State of Incorporation)                    (I.R.S. Employer's Ident No.)


  P. O. Box 422,  Saratoga Springs,  New York            12866 
         
  (Address of principal executive offices)             (Zip Code)



Registrant's telephone number, include area code     518-584-4100    




Number of shares outstanding of issuer's class of common stock
$.33-1/3 par value as at the end of the period covered by this
report 1,338,046.



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          

  


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                       ESPEY MFG. & ELECTRONICS CORP.

                                I N D E X





PART I FINANCIAL INFORMATION                                                PAGE


       Item 1        Financial Statments:


                     Balance Sheets - December 31, 1995                        1
                     and June 30, 1995                                         


                     Statements of Earnings - Six Months                       3
                     Ended December 31, 1995 and 1994
                                                        

                     Statements of Cash Flows - Six Months                     4
                     and Three Months Ended December 31, 1995
                     and 1994              


                     Notes to Financial Statements                             5
                     December 31, 1995 and 1994                    


       Item 2        Management's Discussion and Analysis of                   7
                     Financial Condition and Results of              
                     Operations.                                        



PART II  OTHER INFORMATION                                                    9 

         SIGNATURES                                                           10

                                                                               


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<TABLE>
<CAPTION>



                                   ESPEY MFG. & ELECTRONICS CORP.

                                            Balance Sheets

                                  December 31, 1995 and June 30, 1995

                                             A S S E T S

                                                                 Unaudited                               
                                                                   1995               1995
                                                                December 31         June 30      
<S>                                                           <C>                   <C>                
CURRENT ASSETS:

       Cash and cash equivelents                               $     846,609        $     231,675
       Short-term investments at cost                          
          (market value December 31, 1995,                               
            $300,235 and June 30, 1995,                                             
              $1,497,681)                                            300,000            1,467,540  
                     Total Cash and Short-term
                            Investments                            1,146,609            1,699,215

       Marketable investment securities - current                  9,469,817           10,454,464

       Trade accounts receivable net of                                     
          $3000 allowance December 31, 1995
          and June 30, 1995                                        2,386,905            1,925,778        
       Other receivables                                             302,313               20,627

                     NET RECEIVABLES                               2,689,218            1,946,405
              
       Inventories:

          Raw materials and supplies                                 309,562              400,778
          Work-in-process                                          1,148,000            1,078,169
          Costs relating to contracts in
              process, net of progress payments
              of $773,800 - December 31, 1995 and
              $2,121,800 - June 30,1995                            9,689,451            8,769,378

                     NET INVENTORIES                              11,147,013           10,248,325
                                                                                     
       Income tax refund receivable                                   277,564             410,467  
       Prepaid expenses and other current assets                     340,356              385,033

                     TOTAL CURRENT ASSETS                         25,070,577           25,143,909

MARKETABLE INVESTMENT SECURITIES                                     100,000              100,000

PROPERTY, PLANT AND EQUIPMENT AT COST                             11,568,602           11,464,636 

       Less: Accumulated depreciation and
             amortization                                         (8,080,521)          (7,868,827)

              NET PROPERTY, PLANT AND EQUIPMENT                    3,488,081            3,595,809

                     TOTAL                                     $  28,658,658        $  28,839,718
                                                                                                 

              
                                             - 1 -                                  (Continued)          
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<CAPTION>






                                ESPEY MFG. & ELECTRONICS CORP.

                                   Balance Sheets, Continued

                              December 31, 1995 and June 30, 1995 

                              LIABILITIES AND STOCKHOLDERS' EQUITY

                                                                 Unaudited
                                                                   1995               1995
                                                                December 31         June 30  
<S>                                                            <C>                  <C>
CURRENT LIABILITIES:

       Accounts Payable                                        $    756,386         $    596,823
       Accrued expenses:
          Salaries, wages and commissions                           314,142              104,269
          Employees' insurance costs                                 46,229               50,293
          ESOP payable                                              213,143                 -
          Other                                                      15,693               14,588
          Payroll and other taxes withheld                                   
              and accrued                                           156,750              141,513
          Dividends payable                                             -                    -    
          Deferred income taxes - current                            40,645               75,915
       
                     TOTAL CURRENT LIABILITIES                    1,542,988              983,401
       
       
Deferred income taxes                                                34,000               30,697

                     TOTAL LIABILITIES                            1,576,988            1,014,098

STOCKHOLDERS' EQUITY:

       Common stock, par value .33-1/3 per
       share.  Authorized 2,250,000 shares;
       issued 1,514,937 shares December 31, 1995
       and June 30, 1995.                                           504,979              504,979

       Capital in excess of par value                            10,496,287           10,496,287

       Retained earnings                                         24,010,498           24,678,208
                                                                 35,011,764           35,679,474

       Less:  Common stock subscribed                           ( 5,027,962)         ( 5,027,962)
               Cost of 176,891 shares on December
               31, 1995 and 171,489 shares on
               June 30, 1995 of common stock in
               treasury                                         ( 2,902,132)         ( 2,825,892)

              TOTAL STOCKHOLDERS' EQUITY                         27,081,670           27,825,620

                            TOTAL                              $ 28,658,658         $ 28,839,718
                                                                                                
<FN>
<F1>
       See accompanying notes to financial statements
</FN>
                                                   - 2 -
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<CAPTION>                                                                  


                                                ESPEY MFG. & ELECTRONICS CORP.

                                                     STATEMENTS OF EARNINGS

                                      Six and Three Months Ended December 31, 1995 and 1994
                                             
                                                              Unaudited                                 Unaudited
                                                            Three Months                                Six Months
                                                      1995              1994                    1995                 1994     
<S>                                              <C>                  <C>                  <C>                   <C>          
Net Sales                                        $  4,434,896         $  2,814,595         $  8,435,701          $  6,976,164

Cost of sales                                       3,947,980            2,520,964            7,544,110             6,068,179

              Gross profit                            486,916              293,631              891,591               907,985

Selling, general and administrative expenses          443,195              386,019              854,730               801,683
              Operating income (loss)                  43,721         (     92,388)              36,861               106,302

Other income
       Interest income and dividends                  166,748              156,725              326,210               303,164
       Sundry income                                      437                1,070                7,275                 3,706
                                                      167,185              157,795              333,485               306,870

Earnings before income taxes                          210,906               65,407              370,346               413,172
  
Provision for income taxes                             85,000               32,000              146,000               205,000


              Net earnings                       $    125,906         $     33,407         $    224,346          $    208,172
                                                                                                                             
Earnings per share:


Net earnings                                        $ .10                 $ .02                 $ .17                $ .15
                                                                                                                               

Average number of shares outstanding                1,338,552            1,347,572            1,339,951             1,348,488
                                                                                                                              

<FN>
<F1>
See accompanying notes to Financical Statements
</FN>
                                                               - 3 -                                                     
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<CAPTION>




                                                  
                        
                                   ESPEY MFG. & ELECTRONICS CORP.
                                     Statements of Cash Flows
                            Six Months Ended December 31, 1995 and 1994
                                                                                  Unaudited
                                                                                 December 31        
                                                                          1995                 1994    
Cash Flows From Operating Activities:
<S>                                                                   <C>                  <C>  
       Net earnings                                                   $     224,346        $    208,172

Adjustments to reconcile net earnings to net
cash provided by operating activities:

       Tax effect of dividends on unallocated ESOP shares                    45,063              50,070  
       Depreciation                                                         211,694             207,039
       Changes in assets and liabilities:
              Decrease (increase) in receivables, net                 (     742,813)       (    850,849) 
              Decrease (increase) in inventories, net                 (     898,688)            168,445  
              Decrease (increase) in other current assets                    44,677        (    134,037)
              Decrease (increase) in income tax refund receivable           132,903              88,999
              Increase (decrease) in accounts payable                       159,563             522,876
              Increase (decrease) in accrued salaries,                      209,873             176,645          
              wages and commissions
              Increase (decrease) in accrued employee                 (       4,064)       (     15,635)
                     insurance costs                                                               
              Increase (decrease) in other accrued expenses                   1,105        (      4,508)  
              Increase (decrease) in payroll & other                         15,237        (     20,464)  
                     taxes withheld and accrued
              Increase (decrease) in income tax payable                         -                  -     
              Decrease in deferred income taxes                       (      31,967)       (     41,527) 
              Increase (decrease) in accrued ESOP contributions             213,143             216,295

                                   Net cash provided by (used in)
                                   operating activities               (     419,928)            571,521

Cash Flows From Investing Activities:

       Additions to property, plant & equipment                       (     103,966)       (    706,340)
       Proceeds from sale of marketable investment securities             4,796,099              -
       Purchases of marketable investment securities                  (   3,811,452)             -                     
                                   Net cash provided by (used in)
                                   investing activities                     880,681        (    706,340)

Cash Flows From Financing Activities:

       Dividends on common stock                                      (     937,119)       (    809,042)
       Purchase of treasury stock                                     (      76,240)       (     54,094)

                                   Net cash used in
                                   financing activities               (   1,013,359)       (    863,136)

Increase (decrease) in cash and short-term investments                (     552,606)       (    997,955)

Cash and short-term investments, beginning of period                      1,699,215          13,469,584

Cash and short-term investments, end of period                        $   1,146,609        $ 12,471,629
                                                                                                       


Income Taxes Paid                                                     $     -              $    116,000
                                                                                                       
<FN>
<F1>
See accompanying notes to financial statements. 
</FN>
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                            ESPEY MFG. & ELECTRONICS CORP.

                            Notes to Financial Statements

                                ___________________

1. In the opinion of management, the accompanying unaudited financial statements
   contain all adjustments (consisting of only normal recurring accruals)
   necessary to present fairly the financial position of the Company as of
   Decmember 31, 1995, and the results of operations for each of the three and
   six month periods ended December 31, 1995 and 1994 and cash flows for the six
   month periods ended December 31, 1995 and 1994.

2. The earnings per share computations for December 31, 1995 were based on
   1,339,951 shares and on 1,348,488 shares for December 31, 1994.  These 
   represent the average number of shares outstanding for each respective
   period.

3. Revenues and other income include interest on Certificates of Deposit and
   Treasury Bills in addition to dividends on preferred stocks.

4. There were no material unusual charges or credits to operations or a
   change in accountants during the most recently completed quarter which
   would require the filing of a Form 8-K.

5. There were no securities sold by the Company during the current quarter which
   were not registered under the Securities Act of 1934 in reliance upon an
   exemption from registration provided in Section 4 (2) of the Act.

6. For purposes of the statements of cash flows, the Company considers all
   liquid debt instruments with original maturities of three months or less to
   be cash equivalents. 

7. In fiscal 1989 the Company established an Employee Stock Ownership Plan
   (ESOP) for eligible non-union employees.  The ESOP used the proceeds of a
   loan from the Company to purchase 316,224 shares of the Company's common
   stock for approximately $8.4 million and the Company contributed
   approximately $400,000 to the ESOP which was used by the ESOP to purchase an
   additional 15,000 shares of the Company's common stock.

   The loan from the Company to the ESOP is repayable in annual installments of
   $1,039,605, including interest, through June 30, 2004. Interest is payable
   at a rate of 9% per annum.  The Company's receivable from the ESOP is
   recorded as common stock subscribed in the accompanying balance sheets.

                                          - 5 -
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   Each year, the Company will make contributions to the ESOP which will be used
   to make loan interest and principal payments. With each loan and interest
   payment, a portion of the common stock will be allocated to participating
   employees.  As of December 31, 1995 there were 118,986 shares allocated to
   participants. 


8. The Company adopted the provisions of Statement of Financial Accounting
   Standards (SFAS) No. 115, "Accounting for Certain Investments in Debt and
   Equity Securities," at July 1, 1994.  Upon adoption of SFAS No. 115, at
   July 1, 1994, all amounts included in short-term investments matured within
   three months of the adoption date.  Therefore no amounts were transferred to
   marketable investment securities upon adoption and there was no cumulative
   effect from this change. 






























                                          - 6 -                                
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                    ESPEY MFG. & ELECTRONICS CORP.

              Management's Discussion and Analysis of

            Financial Condition and Results of Operations
                                                               
 
Sales for the six months ended December 31, 1995 were $8,435,701 as compared to
$6,976,164 for the same period in 1994. Sales volume is largely dependent on
both lead times required for new orders and the specific delivery needs of our
customers.

Net earnings for the six month period were $224,346 or $.17 per share compared
to $208,172 or $.15 per share for the corresponding period of last year.

Most of the contracts shipped during the current six month period reflected
about the same gross profit margin as those shipped in the comparable six month
period last year. Cost of sales for both six month periods was 90%, which is
consistent with the Cost of Sales for the first quarter of this year. We feel
that this is a positive trend, and will continue to strive to increase
profitibility primarily through the introduction of products and services of a
more proprietary nature in both the military and industrial marketplace. The
President's message contained in the 1995 Annual Report addressed some of our
specific areas of concentration.

Selling and G & A expenses increased by about 6% during the current six month
period. The major factor accounting for this was an increase in selling
salaries.  

Although our investment base was somewhat lower during the current period,
Investment Income rose slightly. The Company does not feel that there is any
risk associated with its investment policy, since approximately 90% of our
investments are represented by U.S. Government T-Bills, with the balance
represented by Certificates of Deposit and one preferred stock issue of a major
utility.

Since the debt of the Company's ESOP is not to an outside party, we have
eliminated from the Statements of Earnings the offsetting items of Interest
Income and Interest Expense relating to the ESOP. We have also eliminated the
offsetting accruals from the Balance Sheets.

The Company, when possible, funds all of its operations including Financing
Activities and Investing Activities with cash flows resulting from Operating
Activities. It is felt that in the future, funds from Operating Activities will
continue to be adequate to meet these needs. For the current six month period
capital expenditures were approximately $103,966.

During the six month period ended December 31, 1995, the Company repurchased
5402 shares of its common stock.


                            - 7 -
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Under existing authorizations, as of December 31, 1995, funds in the amount of
$1,007,077 were available for the continuing repurchase of the Company's shares.

The backlog as of December 31, 1994 was $16,666,187. The backlog as of December
31, 1995 was $18,596,016.

A dividend in the amount of $.70 per share was declared payable November 21,
1995 to shareholders of record on October 27, 1995. 

                               













































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                            ESPEY MFG. & ELECTRONICS CORP.

                     PART II:  Other Information and Signatures



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

              None during the quarter.            


Item 5.       Other Information    

              None during the quarter.


Item 6.       Exhibits and Reports on Form 8-K

              None during the quarter. 






























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                            S I G N A T U R E S



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.




                                          ESPEY MFG. & ELECTRONICS CORP.




                                                                         
                                          Sol Pinsley, President



                                                                         
                                          Herbert Potoker, Treasurer and
                                          Chief Financial Officer



               
 13 February 1996     
       Date 



















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