UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C.  20549
                                 FORM 10-Q
                                     
                                     
           [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                  OF THE SECURITIES EXCHANGE ACT OF 1934
             For the quarterly period ended September 30, 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     Registrant; State of Incorporation;  I.R.S. Employer
File Number    Address; and Telephone Number        Identification No.
___________    ___________________________________  __________________

  1-10628      CIPSCO INCORPORATED                      37-1260920
                    (An Illinois Corporation)
                    607 East Adams Street
                    Springfield, Illinois  62739
                    217-523-3600

  1-3672       CENTRAL ILLINOIS PUBLIC SERVICE COMPANY     37-0211380
                    (An Illinois Corporation)
                    607 East Adams Street
                    Springfield, Illinois  62739
                    217-523-3600

Indicate by check mark whether the Registrants (1) have 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
Registrants were required to file such reports), and (2) have been subject
to such filing requirements for the past 90 days.

                         Yes    X       No
                              _____              _____

Indicate the number of shares outstanding of each of the issuers' classes
of common stock, as of the latest practicable date:

CIPSCO INCORPORATED   Common stock, no par value, 34,069,542 shares
                      outstanding October 31, 1996

CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
                    Common stock, no par value, 25,452,373
                    shares outstanding and held by
                    CIPSCO INCORPORATED at October 31, 1996
                                     
                            CIPSCO INCORPORATED
                                    AND
                  CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
            FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 1996

                                 CONTENTS


                                                            Page No.
                      PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements

         CIPSCO INCORPORATED

           Consolidated Statements of Income                   

           Consolidated Balance Sheets                         

           Consolidated Statements of Cash Flows               

         CENTRAL ILLINOIS PUBLIC SERVICE COMPANY

           Statements of Income                                

           Balance Sheets                                      

           Statements of Cash Flows                            

         CONDENSED NOTES TO FINANCIAL STATEMENTS of
             CIPSCO Incorporated and Central Illinois
             Public Service Company                        

Item 2.  Management's Discussion and Analysis of
           Financial Condition and Results of
           Operations for CIPSCO Incorporated and
           Central Illinois Public Service Company        

                        PART II.  OTHER INFORMATION

Item 5.  Other Information                                

Item 6.  Exhibits and Reports on Form 8-K                      

Signatures                                                 

Exhibit Index                                                  

Exhibit 12                                                     
The unaudited interim financial statements presented herein include the
consolidated statements of CIPSCO Incorporated and Subsidiaries ("Company")
as well as separate financial statements for Central Illinois Public
Service Company ("CIPS").  The unaudited statements have been prepared by
the Company and CIPS, respectively, pursuant to the rules and regulations
of the Securities and Exchange 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 such rules and regulations, although the
Company and CIPS believe the disclosures are adequate to make the
information presented not misleading.  Both the Company's consolidated
financial statements and the CIPS financial statements should be read in
conjunction with the financial statements and notes thereto included in the
combined Annual Report on Form 10-K of CIPSCO Incorporated and CIPS for the
year ended December 31, 1995.

In the opinion of the Company and CIPS, their respective interim financial
statements filed as part of this Form 10-Q reflect all adjustments
necessary to present fairly the results for the respective periods.  Due to
the effect of weather and other factors which are characteristic of CIPS'
utility operations, financial results for the periods ended September 30,
1996 and 1995 are not necessarily indicative of trends for any twelve-month
period.

This financial and other information is not given in connection with any
sale or offer to buy any security.

Part I.  FINANCIAL INFORMATION
Item 1.  Financial Statements.

<TABLE>
         
                   CIPSCO INCORPORATED AND SUBSIDIARIES
                     Consolidated Statements of Income
             For the Periods Ended September 30, 1996 and 1995
                  (in thousands except per share amounts)
                                (unaudited)


                                                        Three Months Ended      Nine Months Ended
                                                           September 30,           September 30,
                                                        _______________________ _______________________

                                                          1996      1995          1996      1995
                                                        ________  ________      ________   ________
<S>                                                     <C>       <C>           <C>        <C>           
Operating Revenues:
  Electric.......................................       $218,978  $228,198      $560,188   $544,886
  Gas............................................         15,921    13,234       101,280     87,523
  Investment.....................................          2,382     2,431         7,464      5,860
                                                        ________  ________      ________   ________
     Total operating revenues....................        237,281   243,863       668,932    638,269
                                                        ________  ________      ________   ________
Operating Expenses:
  Fuel for electric generation...................         58,574    53,373       165,288    144,228
  Purchased power................................         14,803    18,981        39,734     45,219
  Gas costs......................................          7,546     5,253        60,227     48,322
  Other operation................................         38,279    37,361       107,487    113,897
  Maintenance....................................         12,034    16,018        43,005     46,690
  Depreciation and amortization..................         21,680    21,005        64,810     62,280
  Taxes other than income taxes..................         14,121    14,783        43,505     43,133
                                                        ________  ________      ________   ________
     Total operating expenses....................        167,037   166,774       524,056    503,769
                                                        ________  ________      ________   ________
Operating Income.................................         70,244    77,089       144,876    134,500
                                                        ________  ________      ________   ________

Interest and Other Charges:
  Interest on long-term debt of subsidiary.......          8,279     8,285        24,839     24,583
  Other interest charges.........................          2,110       214         3,037        574
  Allowance for funds used during construction...           (271)     (240)         (446)      (649)
  Preferred stock dividends of subsidiary........            931       957         2,794      2,896
  Miscellaneous, net.............................          1,811      (579)        2,874     (1,915)
                                                        ________  ________      ________   ________
Total interest and other charges.................         12,860     8,637        33,098     25,489
                                                        ________  ________      ________   ________

Income Before Income Taxes.......................         57,384    68,452       111,778    109,011
                                                       _________  ________      ________   ________
Income Taxes.....................................         21,966    26,721        43,260     41,826
                                                        ________  ________      ________   ________
Net Income.......................................       $ 35,418  $ 41,731      $ 68,518   $ 67,185
                                                        ========  ========      ========   ========

Average Shares of Common Stock Outstanding.......         34,070    34,070        34,070     34,070

Earnings per Average Share of Common Stock.......       $   1.04  $   1.22      $   2.01   $   1.97



The accompanying condensed notes to financial statements are an integral
part of these statements.
</TABLE>

<TABLE>
                   CIPSCO INCORPORATED AND SUBSIDIARIES
                        Consolidated Balance Sheets
                  September 30,1996 and December 31, 1995
                              (in thousands)


                                                                 September 30,  December 31,
                                                                     1996          1995
                                                                 _____________  ____________
                                                                  (unaudited)
              ASSETS
<S>                                                              <C>            <C>  
Utility Plant, at original cost:
  Electric.....................................................  $2,355,551     $2,296,402
  Gas..........................................................     236,594        229,118
                                                                 __________     __________
                                                                  2,592,145      2,525,520
  Less-Accumulated depreciation................................   1,184,008      1,132,355
                                                                 __________     __________
                                                                  1,408,137      1,393,165
  Construction work in progress................................      61,546         72,490
                                                                 __________     __________
                                                                  1,469,683      1,465,655
                                                                 __________     __________
Current Assets:
  Cash.........................................................       5,771          1,088
  Temporary investments, at cost which approximates market.....       7,303          7,147
  Accounts receivable, net.....................................      82,812         65,267
  Accrued unbilled revenues....................................      19,669         27,234
  Materials and supplies, at average cost......................      39,827         40,246
  Fuel for electric generation, at average cost................      34,223         42,634
  Gas stored underground, at average cost......................      14,219          9,774
  Prepayments..................................................       9,292         10,649
  Other current assets.........................................       8,195          8,197
                                                                 __________     __________
                                                                    221,311        212,236
                                                                 __________     __________

Investments and Other Assets:
  Marketable securities........................................      49,697         45,967
  Leveraged leases and energy investments......................      61,111         59,114
  Other........................................................      50,311         44,939
                                                                 __________     __________
                                                                    161,119        150,020
                                                                 __________     __________
                                                                 $1,852,113     $1,827,911
                                                                 ==========     ==========

    CAPITALIZATION AND LIABILITIES

Capitalization:
  Common shareholders' equity..................................  $  667,790     $  651,532
  Preferred stock of subsidiary................................      80,000         80,000
  Long-term debt of subsidiary.................................     421,152        478,926
                                                                 __________     __________
                                                                  1,168,942      1,210,458
                                                                 __________     __________

Current Liabilities:
  Long-term debt of subsidiary due within one year.............      58,000              -
  Short-term borrowings........................................      53,991         47,921
  Accounts payable.............................................      42,851         60,603
  Accrued wages................................................      10,727          9,335
  Accrued taxes................................................      12,700         11,266
  Accrued interest.............................................       8,785          9,525
  Other........................................................      47,411         33,265
                                                                 __________     __________
                                                                    234,465        171,915
                                                                 __________     __________

Deferred Credits:
  Accumulated deferred income taxes............................     332,042        325,181
  Investment tax credits.......................................      49,722         52,234
  Regulatory liabilities, net..................................      66,942         68,123
                                                                 __________     __________
                                                                    448,706        445,538
                                                                 __________     __________
                                                                 $1,852,113     $1,827,911
                                                                 ==========     ==========


The accompanying condensed notes to financial statements are an integral
part of these statements.
</TABLE>

<TABLE>
                   CIPSCO INCORPORATED AND SUBSIDIARIES
                   Consolidated Statements of Cash Flows
             For the Periods Ended September 30, 1996 and 1995
                              (in thousands)
                                (unaudited)


                                                                       Nine Months Ended
                                                                         September 30,
                                                                    _________________________
                                                                        1996           1995
                                                                    __________     __________
<S>                                                                 <C>            <C>
Operating Activities:
  Net income......................................................... $ 68,518     $   67,185
  Adjustments to reconcile net income to net cash provided:
    Depreciation and amortization....................................   64,810         62,280
    Allowance for equity funds used during construction (AFUDC)......     (196)          (599)
    Deferred income taxes, net.......................................    5,324          9,133
    Investment tax credit amortization...............................   (2,512)        (2,521)
  Cash flows impacted by changes in assets and liabilities:
    Accounts receivable, net and accrued unbilled revenues...........   (9,980)         2,809
    Fuel for electric generation.....................................    8,411         (9,753)
    Other inventories................................................   (4,026)         1,841
    Prepayments......................................................    1,357         (2,505)
    Other assets.....................................................   (5,370)        (9,715)
    Accounts payable and other liabilities...........................   (3,606)        14,656
    Accrued wages, taxes and interest................................    2,086         11,473
  Other..............................................................       65         (6,340)
                                                                    __________     __________
    Net cash provided by operating activities........................  124,881        137,944
                                                                    __________     __________
Investing Activities:
  Utility construction expenditures, excluding AFUDC.................  (67,760)       (66,243)
  Allowance for borrowed funds used during construction..............     (250)           (49)
  Changes in temporary investments...................................     (156)            18
  Long-term marketable securities....................................   (3,285)          (662)
  Long-term leveraged leases and energy investments..................   (1,997)        (8,274)
                                                                    __________     __________
    Net cash used in investing activities............................  (73,448)       (75,210)
                                                                    __________     __________
Financing Activities:
  Common stock dividends paid........................................  (52,808)       (51,786)
  Proceeds from issuance of long-term debt of subsidiary.............        -         20,000
  Repayment of long-term debt of subsidiary..........................        -        (16,000)
  Proceeds from issuance of (repayment of) short-term borrowings.....    6,070        (14,985)
  Issuance expense, discount and premium.............................      (12)          (230)
                                                                    __________     __________
    Net cash used in financing activities............................  (46,750)       (63,001)
                                                                    __________     __________

  Net increase (decrease) in cash....................................    4,683           (267)
  Cash at beginning of period........................................    1,088          1,963
                                                                    __________     __________
  Cash at end of period.............................................. $  5,771     $    1,696
                                                                    ==========     ==========

Supplemental Disclosures of Cash Flow Information:

  Cash paid during the period for:
    Interest, net of amounts capitalized............................. $ 26,935     $   24,245
    Income taxes..................................................... $ 35,685     $   23,432



The accompanying condensed notes to financial statements are an integral
part of these statements.
</TABLE>

<TABLE>
                  CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
                           Statements of Income
             For the Periods Ended September 30, 1996 and 1995
                              (in thousands)
                                (unaudited)



                                                       Three Months Ended   Nine Months Ended
                                                          September 30,       September 30,
                                                       __________________   __________________
                                                         1996      1995      1996      1995
                                                       ________  ________   ________  ________
<S>                                                    <C>       <C>        <C>       <C>
Operating Revenues:
  Electric.......................................      $218,982  $228,213   $560,205  $544,914
  Gas............................................        15,922    13,236    101,283    87,528
                                                       ________  ________   ________  ________
     Total operating revenues....................       234,904   241,449    661,488   632,442
                                                       ________  ________   ________  ________

Operating Expenses:
  Fuel for electric generation...................        58,574    53,373    165,288   144,228
  Purchased power................................        14,803    18,981     39,734    45,219
  Gas costs......................................         7,546     5,253     60,227    48,322
  Other operation................................        37,998    37,050    106,540   112,897
  Maintenance....................................        12,033    16,017     43,002    46,689
  Depreciation and amortization..................        21,593    20,780     64,468    61,814
  Taxes other than income taxes..................        14,114    14,782     43,485    43,107
  Income taxes:
    Current......................................        19,082    21,701     44,568    38,305
    Deferred, net................................         4,716     5,125        968     4,413
    Deferred investment tax credits, net.........          (837)     (840)    (2,511)   (2,521)
                                                       ________  ________   ________  ________
     Total operating expenses....................       189,622   192,222    565,769   542,473
                                                       ________  ________   ________  ________
Operating Income.................................        45,282    49,227     95,719    89,969
                                                       ________  ________   ________  ________

Other Income and Deductions:
  Allowance for equity funds used during
  construction...................................           119       222        196       599
  Nonoperating income taxes......................         1,581      (279)     1,243    (1,099)
  Miscellaneous, net.............................        (1,781)      625     (2,781)    2,325
                                                       ________  ________   ________  ________
     Total other income and deductions...........           (81)      568     (1,342)    1,825
                                                       ________  ________   ________  ________
Income Before Interest Charges...................        45,201    49,795     94,377    91,794
                                                       ________  ________   ________  ________

Interest Charges:
  Interest on long-term debt.....................         8,279     8,285     24,839    24,583
  Other interest charges.........................         2,114       203      3,041       540
  Allowance for borrowed funds used during
  construction...................................          (152)      (18)      (250)      (49)
                                                       ________  ________   ________  ________
      Total interest charges.....................        10,241     8,470     27,630    25,074
                                                       ________  ________   ________  ________

Net Income.......................................        34,960    41,325     66,747    66,720
Preferred Stock Dividends........................           931       957      2,795     2,896
                                                       ________  ________   ________  ________
Earnings for Common Stock........................      $ 34,029  $ 40,368   $ 63,952  $ 63,824
                                                       ========  ========   ========  ========



The accompanying condensed notes to financial statements are an integral
part of these statements.
</TABLE>

<TABLE>
                  CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
                              Balance Sheets
                 September 30, 1996 and December 31, 1995
                              (in thousands)


                                                              September 30,  December 31,
                                                                  1996           1995
                                                              _____________  ____________
                                                               (unaudited)
              ASSETS
<S>                                                           <C>            <C>
Utility Plant, at original cost:
  Electric.....................................................  $2,355,551    $2,296,402
  Gas..........................................................     236,594       229,118
                                                                 __________    __________
                                                                  2,592,145     2,525,520
  Less-Accumulated depreciation................................   1,184,008     1,132,355
                                                                 __________    __________
                                                                  1,408,137     1,393,165
  Construction work in progress................................      61,546        72,490
                                                                 __________    __________
                                                                  1,469,683     1,465,655
                                                                 __________    __________

Current Assets:
  Cash.........................................................       5,716         1,006
  Accounts receivable, net.....................................      82,887        65,574
  Accrued unbilled revenues....................................      19,669        27,234
  Materials and supplies, at average cost......................      39,827        40,246
  Fuel for electric generation, at average cost................      34,223        42,634
  Gas stored underground, at average cost......................      14,219         9,774
  Prepayments..................................................       9,198        10,268
  Other current assets.........................................       8,197         8,226
                                                                 __________    __________
                                                                    213,936       204,962
                                                                 __________    __________
Other Assets...................................................      49,303        44,188
                                                                 __________    __________
                                                                 $1,732,922    $1,714,805
                                                                 ==========    ==========
    CAPITALIZATION AND LIABILITIES

Capitalization:
  Common shareholder's equity..................................  $  584,224    $  570,419
  Preferred stock..............................................      80,000        80,000
  Long-term debt...............................................     421,152       478,926
                                                                 __________    __________
                                                                  1,085,376     1,129,345
                                                                 __________    __________

Current Liabilities:
  Long-term debt due within one year...........................      58,000             -
  Short-term borrowings........................................      53,991        47,921
  Accounts payable.............................................      42,304        60,791
  Accrued wages................................................      10,727         9,320
  Accrued taxes................................................      14,030        11,155
  Accrued interest.............................................       8,785         9,525
  Other........................................................      47,413        33,264
                                                                 __________    __________
                                                                    235,250       171,976
                                                                 __________    __________
Deferred Credits:
  Accumulated deferred income taxes............................     295,632       293,127
  Investment tax credits.......................................      49,722        52,234
  Regulatory liabilities, net..................................      66,942        68,123
                                                                 __________    __________
                                                                    412,296       413,484
                                                                 __________    __________
                                                                 $1,732,922    $1,714,805
                                                                 ==========    ==========


The accompanying condensed notes to financial statements are an integral
part of these statements.
</TABLE>

<TABLE>
                  Central Illinois Public Service Company
                         Statements of Cash Flows
             For the Periods Ended September 30, 1996 and 1995
                              (in thousands)
                                (unaudited)


                                                                       Nine Months Ended
                                                                         September 30,
                                                                     _______________________

                                                                       1996         1995
                                                                     __________   __________
<S>                                                                  <C>          <C>             
Operating Activities:                                                
  Net income......................................................     $ 66,747    $  66,720
  Adjustments to reconcile net income to net cash provided:
    Depreciation and amortization.................................       64,468       61,814
    Allowance for equity funds used during construction (AFUDC)...         (196)        (599)
    Deferred income taxes, net....................................          968        4,413
    Investment tax credit amortization............................       (2,512)      (2,521)
  Cash flows impacted by changes in assets and liabilities:
    Accounts receivable, net and accrued unbilled revenues........       (9,748)       2,387
    Fuel for electric generation..................................        8,411       (9,753)
    Other inventories.............................................       (4,026)       1,841
    Prepayments...................................................        1,070       (2,494)
    Other assets..................................................       (5,086)      (7,697)
    Accounts payable and other liabilities........................       (4,338)      14,229
    Accrued wages, taxes and interest.............................        3,542       11,490
  Other...........................................................          407       (5,874)
                                                                      _________    _________
    Net cash provided by operating activities.....................      119,707      133,956
                                                                      _________    _________

Investing Activities:
  Construction expenditures, excluding AFUDC......................      (67,760)     (66,243)
  Allowance for borrowed funds used during construction...........         (250)         (49)
  Changes in temporary investments................................            -         (701)
                                                                      _________    _________
    Net cash used in investing activities.........................      (68,010)     (66,993)
                                                                      ---------    ---------

Financing Activities:
  Proceeds from issuance of long-term debt........................            -       20,000
  Repayment of long-term debt.....................................            -      (16,000)
  Proceeds from issuance of (repayment of) short-term borrowings..        6,070      (14,985)
  Dividends paid:
    Preferred stock...............................................       (2,795)      (2,896)
    Common stock..................................................      (50,250)     (52,500)
  Issuance expense, discount and premium..........................          (12)        (230)
                                                                      _________    _________
    Net cash used in financing activities.........................      (46,987)     (66,611)
                                                                      _________    _________
  Net increase (decrease) in cash.................................        4,710          352
  Cash at beginning of period.....................................        1,006        1,320
                                                                      _________    _________
  Cash at end of period...........................................    $   5,716    $   1,672
                                                                      =========    =========
Supplemental Disclosures of Cash Flow Information:

  Cash paid during the period for:
    Interest, net of amounts capitalized..........................    $  26,935    $  24,245
    Income taxes..................................................    $  38,052    $  27,622



The accompanying condensed notes to financial statements are an integral
part of these statements.
</TABLE>


                   CIPSCO INCORPORATED AND SUBSIDIARIES
                  CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
                  CONDENSED NOTES TO FINANCIAL STATEMENTS
                            SEPTEMBER 30, 1996
                                (unaudited)




Note 1.  GENERAL
________________

The consolidated financial statements presented herein include the accounts
of CIPSCO INCORPORATED (CIPSCO), CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
(CIPS), and CIPSCO INVESTMENT COMPANY AND SUBSIDIARIES (CIC).  CIPSCO and
Subsidiaries are referred to as the "Company."  CIPSCO has two first-tier
subsidiaries:  CIC, an investment subsidiary, and CIPS, an electric and gas
public utility.

The financial statements of CIPS, a subsidiary of CIPSCO, include only the
accounts of CIPS.  Prior year amounts have been reclassified on a basis
consistent with the September 30, 1996 presentation.


Note 2.  COMMITMENTS AND CONTINGENCIES
______________________________________

ENVIRONMENTAL REMEDIATION COSTS - CIPS has identified 13 former
manufactured gas plant sites (environmental remediation sites) which
contain potentially harmful materials.  In 1990, one site was added to the
United States Environmental Protection Agency (USEPA) Superfund list.  CIPS
is implementing an approved long-term remedial plan for the site.  Costs
and associated legal expenses related to studies and remediation work have
been incurred at other sites.

Over the past several years, CIPS has received cash settlements from
certain of its insurance carriers arising from litigation instituted by
CIPS (which is now concluded) seeking indemnification for, among other
things, costs incurred by CIPS in connection with the sites.  Effective
with April 1993 billings to customers, CIPS began recovery of clean-up
costs associated with the sites through environmental adjustment clause
riders approved by the Illinois Commerce Commission (the "Illinois
commission").  As required by the Illinois commission, the riders provided
for (1) recovery of cleanup costs from ratepayers (with a credit or offset
to the extent such recovered cleanup costs are reimbursed from insurance
carriers or other parties) and (2) a prudence review (including
determination of what constitutes recoverable environmental cleanup costs
and the amount of such expenditures).  The Illinois Supreme Court has ruled
that cleanup costs are recoverable in rates and that use of a rider
mechanism to recover such costs is appropriate.  Through December 31, 1993,
CIPS collected $2.9 million under the riders.  No amounts have been
collected under the riders since January 1994.

The estimated incurred costs relating to studies and remediation at the 13
sites and associated legal expenses are being accrued and deferred pursuant
to the Illinois commission's orders rather than expensed currently, pending
recovery through rates or from other parties.  Through September 30, 1996,
$47.9 million had been deferred representing costs incurred and estimates
of costs of completing studies at various sites and estimates of future
remediation costs to be incurred at the Superfund and other sites.  The
total of the costs deferred, net of recoveries from insurers and through
the rate riders described above, was $10.4 million at September 30, 1996.

The Illinois commission has initiated reconciliation proceedings to review
CIPS' environmental remediation activities for 1993, 1994 and 1995, and to
determine whether the revenues collected under the riders in 1993 were
consistent with the amount of remediation costs prudently incurred.
Amounts found to have been incorrectly included under the riders would be
subject to refund.

Management believes that any costs incurred in connection with the sites
that are not recovered from others will be recovered through the
environmental rate riders.  Accordingly, management believes that costs
incurred in connection with these sites will not have a material adverse
effect on financial position, results of operations, or liquidity of the
Company or CIPS.

FERC ORDERS 888 and 889 - On April 24, 1996, the Federal Energy Regulatory
Commission ("FERC") issued orders 888 and 889 related to its "mega-NOPR"
rulemaking.  Citing a goal of enhancing competition in the wholesale market
for generation sales, Order 888 requires each transmission-owning public
utility, such as CIPS, to provide transmission access and service to others
in a manner similar and comparable to that which the utility has by virtue
of transmission ownership. In its Order 888, the FERC adopted a single pro
forma tariff for use by the utility and its transmission customers in
obtaining transmission service. Order 888 also provides for the recovery of
stranded costs at the wholesale level, based on a revenues lost
calculation, which result from the transition to an open access business
environment.  On July 9, 1996, CIPS filed open access tariffs under Rule
888 for transmission service.  Also, in conjunction with the application at
the FERC regarding the merger of CIPSCO and Union Electric Company ("UE")
(see Part II Item 5.  Other Information), CIPS and UE jointly filed single-
system open access tariffs with FERC.  Because these tariffs were filed
under provisions of the rulemaking prior to the issuance of Order 888,
these tariffs will be revised by November 15, 1996 to comply with the final
rule in Order 888, but will only become effective upon completion of the
merger.

Order 889 sets forth the standards of conduct and information requirements
that must be put in place and observed by transmission-owning public
utilities doing business under the open access rule.  These include the
establishment by each utility of an "open access same-time information
system",or OASIS.  This system will provide all information, on a real time
basis, for the utility and its customers to apply for and obtain
transmission service.  Using OASIS, the utility must obtain transmission
service for its own use in the same manner its customer will obtain
service, thus assuring mitigation of market power through control of
transmission facilities.  CIPS has applied for a waiver from the
requirements of Order 889 pending consummation of the merger.

CLEAN AIR ACT - CIPS' current compliance strategy to meet the requirements
of the Clean Air Act Amendments of 1990 (Amendments) is to rely primarily
on switching to a lower sulfur coal at its generating units rather than
increased scrubbing and use of higher sulfur coal at its Newton Unit 1.
The estimated capital costs of compliance are included in the CIPS five-
year construction forecast.  On June 20, 1996 CIPS and Amax Coal Sales
Company, a Cyprus Amax Minerals Company ("Cyprus Amax"), a coal supplier
for CIPS' Newton Power Station Unit 1, executed a letter of intent which
contemplates that the parties will enter into a modification of their
existing contract.  Under the contract as it is proposed to be modified (the
"Contract Modification") CIPS (1) would make a $70 million payment, plus
interest from November 1, 1996, to Cyprus Amax not later than February 17,
1997, (2) would be able to purchase at market prices low-sulfur, out-of-state
coal (which may be procured from Cyprus Amax, its affiliates or other
providers) in substitution for the high-sulfur Illinois coal CIPS is currently
obligated to purchase from Cyprus Amax, and (3) would receive options for
future purchases of low-sulfur, out-of-state coal from Cyprus Amax or its
affiliates in 1997, 1998 and 1999 at set negotiated prices. Effectiveness of
the Contract Modification is subject to execution of definitive agreements by
the parties.  In addition, CIPS and Cyprus Amax have agreed that for the
remainder of 1996, CIPS will cease taking delivery of high-sulfur coal under
the existing contract and will make certain alternate low-sulfur, out-of-state
coal purchases from Cyprus Amax or its affiliates.  By switching to low-sulfur
coal over the term of the Contract Modification and thereafter CIPS will
avoid the need for substantial renovation to the Newton Unit 1 scrubber.
Under the letter of intent, CIPS would not be required to proceed with the
Contract Modification if CIPS determines that the regulatory treatment of the
transaction is unsatisfactory.  On July 17, 1996, CIPS filed an Application
(Docket 96- 0345) seeking a review by the Illinois commission of certain
matters related to the Contract Modification, including authorization to
recover the $70 million payment (and associated carrying charges) in rates
over a six-year period, approval of a switch to out-of-state coal from
Illinois coal as required by Illinois statutes, recognition of a regulatory
asset in the amount of $44 million relating to the scrubber and the estimated
cost of removing the scrubber from service, and approval of CIPS' proposed
accounting treatment for the transaction.  CIPS cannot predict what action
the Illinois commission will take in this matter. An order is expected in
December 1996.

LABOR ISSUES - The International Union of Operating Engineers Local 148 and
the International Brotherhood of Electrical Workers Local 702 have both
filed unfair labor practice charges with the National Labor Relations Board
(NLRB) relating to the legality of the lockout by CIPS of both unions
during 1993.  The Peoria Regional Office of the NLRB has issued complaints
against CIPS concerning the lockout.  Both unions seek, among other things,
back pay and other benefits for the period of the lockout.  CIPS estimates
the amount of back pay and other benefits for both unions to be less than
$15 million.  An administrative law judge of the NLRB has ruled that the
lockout was unlawful.  On July 23, 1996, the Company appealed to the NLRB.
Management believes the lockout was both lawful and reasonable and that the
final resolution of this matter will not have a material adverse effect on
financial position, results of operations or liquidity of the Company or
CIPS.

OTHER ISSUES - CIPS is involved in other legal and administrative
proceedings before various courts and agencies with respect to rates,
taxes, gas and electric fuel cost reconciliations, service area disputes,
environmental torts and other matters.  Although unable to predict the
outcome of these matters, management believes that appropriate liabilities 
have been established and that final disposition of these actions will not 
have a material adverse effect on financial position, results of operations or 
liquidity of the Company or CIPS.

Note 3.  REGULATORY ASSETS AND LIABILITIES
__________________________________________

Statement of Financial Accounting Standards (SFAS) No. 71, "Accounting for
Effects of Certain Types of Regulation," applies to regulated entities
whose rates are designed to recover the cost of providing service to
customers through the ratemaking process.  SFAS No. 71 allows certain costs
that would normally be reflected in net income to be deferred on the
balance sheet as regulatory assets. These costs are then amortized as the
related amounts are reflected in rates.  Under current accounting
pronouncements, if a loss with respect to such an asset becomes probable,
any unamortized balance, net of tax, would reduce net income.  (See Note
4.)

The Company continually reviews regulatory assets and liabilities.  As
shown below, the Company is in a net regulatory liability position at
September 30, 1996, and currently believes that there would be no material
adverse impact on results of operations, financial position or liquidity if
the Company or CIPS were to discontinue application of SFAS No. 71.

The components of regulatory assets and liabilities at September 30, 1996
are:

                Description                                     Amount
                ___________                                     ______
                                                            (in thousands)

Regulatory Assets:
   Deferred environmental remediation costs                    $ 10,411
   Take-or-Pay costs                                                731
   Unamortized costs related to reacquired debt                  12,505
                                                               ________
        Total Regulatory Assets - in
          Other Assets on Balance Sheet                        $ 23,647
                                                               ========

Regulatory Liabilities:
   Clean Air Act allowances, net                               $  1,365
   SFAS 109 - Income Taxes, net                                  65,577
                                                               ________

      Total Regulatory Liabilities, Net                        $ 66,942
                                                               ========

Regulatory Liabilities Net of Regulatory Assets                $ 43,295
                                                               ========

Note 4.  SFAS NO. 121
_____________________

Statement of Financial Accounting Standards (SFAS) No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to be
Disposed Of," effective January 1, 1996, established accounting standards
for the impairment of long-lived assets.  SFAS No. 121 also required that
regulatory assets which are no longer probable of recovery through future
revenue to be charged to earnings. The adoption of SFAS No. 121 has had no
impact and is not expected to have an impact on the financial position,
results of operations or liquidity of the Company or CIPS.

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

The Company and Union Electric Company entered into a Merger Agreement
dated August 11, 1995 (the "Merger Agreement").  The Merger Agreement was
approved by shareholders of both parties in December 1995. Consummation of
the merger contemplated by the Merger Agreement is conditioned on, among
other things, receipt of regulatory and governmental approvals, including
approval of the Illinois commission, the Missouri Public Service 
Commission (MPSC), FERC, the Nuclear Regulatory Commission and the Securities 
and Exchange Commission under the Public Utility Holding Company Act of 1935.  
The Company cannot predict when all necessary approvals will be obtained but 
expects the merger to be consummated by the end of 1997.  On July 12, 1996, a 
joint agreement was filed with the MPSC that recommends approval of the merger.
Union Electric Company, the MPSC staff, the office of Public Counsel, several
customer groups and others signed the agreement.  On September 25, 1996,
the MPSC ordered that additional information be filed in November 1996 in
connection with the merger proceeding.  The MPSC is expected to issue a
decision on the merger in early 1997.  On November 7, 1996, a Hearing
Examiner for the Illinois commission issued a proposed order recommending
that the merger be approved subject to certain conditions, including (i) that
each of CIPS and Union Electric be required to file a rate case or alternative
regulation plan within one year following the closing of the merger, (ii) that
the ratemaking treatment of merger costs and savings be determined in the rate
case or alternative regulation proceeding and (iii) that the proposed transfer
to CIPS of Union Electric's existing Illinois electric and gas distribution
business and facilities be denied, but that the joint dispatch agreement be 
approved.  CIPSCO cannot predict what action the Illinois commission will take 
in the matter; however, an order from the Illinois commission is expected by 
the end of 1996.  On October 16, 1996, the FERC set the merger for hearing, 
ordering the administrative law judge to issue an initial order no later than 
April 30, 1997.  The FERC is expected to issue a decision on the merger by the 
end of 1997. Certain pro forma financial information is included in Part II, 
Item 5. Other Information of this report.

The following discussion and analysis of financial condition and results of
operations is for CIPSCO Incorporated and Subsidiaries ("Company") unless
otherwise stated.

THE OUTLOOK

CIPS currently estimates that its total construction expenditures for the
1996-2000 period will be about $510 million.  Projected external financing
requirements for the 1996-2000 period are expected to be $258 million which
includes $133 million for scheduled debt retirements and up to $125 million
(less than $100 million in 1996) to fund the construction program and
certain other capital requirements, including the $70 million payment
related to the proposed coal contract modification with Cyprus Amax
discussed in Note 2 to the Notes to Condensed Financial Statements of this
report under "Clean Air Act."  Remaining capital requirements for the 1996-
2000 period are expected to be met through internally generated funds.  The
estimated construction expenditures and other capital requirements as well
as anticipated financing plans take into account the current strategy for
compliance with the Clean Air Act, as amended, and the proposed coal
contract modification described in Note 2 of Condensed Notes to Financial
Statements.

CIPS has an effective shelf registration statement on file with the
Securities and Exchange Commission which permits the issuance of an
aggregate of up to $29 million of first mortgage bonds, medium-term notes
and/or preferred stock and has received approval from the Illinois
commission to issue, through December 31, 1998, up to $200 million of long-
term indebtedness outstanding at any time.

For the first nine months of 1996, CIPS' total capital requirements were
provided from internal sources.

Common stock dividends paid for the twelve months ended September 30, 1996,
resulted in a payout ratio of 96% of the Company's earnings to common
shareholders.  Common stock dividends paid to the Company's common
shareholders equalled 52% of net cash provided by operating activities for
the same period.

In connection with consummation of the merger contemplated by the Merger
Agreement, it is expected that the Company will incur $10.3 million of
transaction costs.  Through September 30, 1996, these transaction costs
totalled $6.7 million.  The Company expects that these costs (which are not
tax deductible) will approximate $2 million or 5 cents per share in 1996
and $3.8 million or 11 cents per share in 1997.

FINANCIAL CONDITION

Financial condition and changes in total Shareholder Equity of the Company
and CIPS for the nine-month periods ended September 30, 1996 and 1995 are
as follows:

                                                 Nine Months Ended
                                                   September 30,
                                             _________________________
                                                  (in thousands)
The Company:                                    1996           1995
                                             _________      _________
  Common Shareholders' Equity

Net income                                   $ 68,518       $ 67,185
Common stock dividends paid                   (52,808)       (51,786)
Other                                             548            (85)
                                             ________       ________
  Change in Shareholders' Equity             $ 16,258       $ 15,314
                                             ========       ========

                                                 Nine Months Ended
                                                   September 30,
                                             _________________________
                                                  (in thousands)
CIPS:                                           1996           1995
                                             _________      _________
  Common Shareholder's Equity

Earnings for common stock                    $ 63,952       $ 63,824
Common stock dividends paid                   (50,250)       (52,500)
Other                                             103            (86)
                                             ________       ________
  Change in Shareholder's Equity             $ 13,805       $ 11,238
                                             ========       ========

OVERVIEW

The Company's earnings per share were $1.04 for the quarter ended September
30, 1996, compared to $1.22 per share earned during the same period in
1995.  The decrease primarily reflects lower kilowatthour sales to
residential and commercial customers due to milder weather in the 1996
period. The Company's earnings per share were $2.01 for the nine months
ended September 30, 1996, compared to $1.97 per share earned during the
same period in 1995. The increase reflects modestly higher sales to CIPS
customers, market gains in non-utility investments and lower other
operation and maintenance expenses in 1996.  The 1995 expenses for the nine
months include $.10 per share for the voluntary workforce reduction program
recorded in February 1995.

The following table summarizes the components of consolidated net income
and CIPS earnings for common stock for the three months and nine month
periods ended September 30, 1996 and 1995 (see Results of Operations for
further discussion).  In this table, electric operating margin equals
electric operating revenues less revenue taxes, fuel for electric
generation and purchased power.  Gas operating margin equals gas operating
revenues less revenue taxes and gas costs.

                                Third Quarter     Nine Months Ended
                              Ended September 30,   September 30,
                              __________________  ___________________
                                1996      1995      1996      1995
                              ________  ________  ________  ________
CIPS
  Electric operating
   margin                     $138,162  $147,944  $336,086  $336,393
  Gas operating margin           7,857     7,471    35,508    34,089
  Other deductions and
   interest expenses          (111,059) (114,090) (304,847) (303,762)

  CIPS preferred stock
   dividends                      (931)     (957)   (2,795)   (2,896)
                              ________  ________  ________  ________
    Total earnings
     for common stock           34,029    40,368    63,952    63,824
                              ________  ________  ________  ________

NON-UTILITY
  Investment revenues            2,350     2,381     7,366     5,440
  Other deductions
   and expenses                   (961)   (1,018)   (2,800)   (2,079)
                              ________  ________  ________  ________
    Total non-utility
     net income                  1,389     1,363     4,566     3,361
                              ________  ________  ________  ________
Consolidated net income       $ 35,418  $ 41,731  $ 68,518  $ 67,185
                              ========  ========  ========  ========

RESULTS OF OPERATIONS

The results of operations of the Company and CIPS for the three months and
nine months ended September 30, 1996, compared to the same periods in 1995
are presented below.

   The Company
                                 Net Income
                               (in thousands)          Earnings Per Share
                           ________________________  ________________________
                           Three Months Nine Months  Three Months Nine Months
                           ____________ ___________  ____________ ___________

     1996                    $35,418     $68,518        $1.04      $2.01
     1995                     41,731      67,185         1.22       1.97
                             _______     _______        _____      _____
     Increase (Decrease)     $(6,313)    $ 1,333        $(.18)     $ .04

     Percent
      Increase (Decrease)        (15)%         2%         (15)%        2%

   CIPS
                                        Earnings for Common Stock
                                             (in thousands)
                                        ___________________________
                                        Three Months   Nine Months
                                        ____________   ___________

     1996                                 $34,029       $63,952
     1995                                  40,368        63,824
                                          _______       _______
     Increase (Decrease)                  $(6,339)      $   128
                                          =======       =======
     Percent
      Increase (Decrease)                     (16)%           - %

OPERATING REVENUES

The changes in electric and gas revenues described below are for the
Company.  The only differences between changes in electric and gas
operating revenues for the Company and for CIPS are intercompany revenues
that are eliminated in the consolidated financial statements.  These
intercompany amounts are immaterial.

Electric revenues declined 4% in the third quarter of 1996 compared to the
third quarter of 1995 reflecting a decline in retail KWH sales due
principally to milder weather conditions in 1996.  KWH sales to residential
and commercial customers decreased 13% and 4%, respectively, due to fewer
cooling degree days in the third quarter of 1996.  Industrial electric
sales were slightly higher in the third quarter of 1996 compared to the
same quarter in 1995. Power supply agreement revenues for the third quarter
of 1996 were 1% below those of the third quarter of 1995 due to a decline
in transportation revenues related to these agreements.  Economy and
emergency interchange sales increased 7% in the third quarter of 1996 over 
the same period in 1995 due to more favorable market conditions in the 
interchange marketplace.  Sales to cooperatives and municipals declined in the 
third quarter of 1996 compared to the same quarter in 1995 due primarily to 
milder weather in 1996.  One cooperative, Soyland Power Cooperative, with 
whom CIPS has a power supply agreement for up to 102 megawatts through 1999, 
is experiencing financial difficulties. These sales are recorded under Power 
Supply Agreements.  As of September 30, 1996, Soyland was current in the 
payment of all of its obligations to CIPS.

Electric revenues increased 3% in the first nine months of 1996 compared to
the same period of 1995 reflecting higher KWH sales due principally to
weather conditions in 1996.  KWH sales to retail customers increased 1%,
while wholesale sales were up 2%.  Power supply agreement revenues for the
nine months ended September 30, 1996, were 3% above those of the same
period in 1995 due to increased transportation revenues related to these
agreements.  Economy and emergency interchange sales increased 6% in the
first nine months of 1996 over the same period in 1995 due to favorable
market conditions in the interchange marketplace.  Sales to cooperatives
and municipals increased in the nine months ended September 30, 1996
compared to the same period in 1995 due primarily to favorable weather
conditions in 1996.

<TABLE>
The changes in electric revenue and KWH sales are shown below:

                                   CHANGES IN ELECTRIC REVENUE AND
                                         KILOWATTHOUR SALES
                                  INCREASE (DECREASE) FROM PRIOR YEAR
                                            (in thousands)
                    ______________________________________    ___________________________________
                              Third Quarter                              Nine Months
                    ______________________________________    ___________________________________
                    Revenue      Rev %      KWH      KWH %    Revenue    Rev %     KWH      KWH %
                    ________     _____   _________   _____    _______    _____   _______    _____
<S>                 <C>          <C>     <C>         <C>      <C>        <C>     <C>        <C>  
Residential         $ (9,511)    (11)%    (113,858)  (13)%    $ (2,257)   (1)%     2,543      - %
Commercial            (1,112)     (2)      (26,395)   (4)        3,458     3      40,885      2
Industrial              (824)     (2)        2,375     -         1,045     1      24,269      1
Public Authorities
 and Other              (280)     (5)          776     2            43     -      (2,956)    (2)
                    ________               _______            ________           _______
  Total Retail      $(11,727)     (7)%    (137,102)   (6)%    $  2,289     1 %    64,741      1 %

Power Supply
 Agreements         $   (109)     (1)%     (78,877)  (16)%    $  1,354     3 %   (65,671)    (6)%
Interchange Sales
 (economy/emergency)   2,881      12        80,939     7        10,913    21     157,581      6
Cooperatives and
 Municipals             (265)     (4)       (8,866)   (6)          746     4       7,714      2
                    ________                _______           ________           _______
  Total Sales for
   Resale           $  2,507       5%       (6,804)    - %    $ 13,013    11 %    99,624      2 %
                    ________                _______           ________           _______
  Total             $ (9,220)     (4)%    (143,906)  (4) %    $ 15,302     3 %   164,365      2 %
                    ========               ========           ========           =======
</TABLE>

Gas revenues increased 20% in the third quarter and 16% in the first nine
months of 1996 compared to the same periods in 1995.  This was primarily
due to higher purchased gas costs which flow through to revenues through
the Purchased Gas Adjustment Clause (PGA).  In addition, colder weather in
1996 caused therm sales to increase in the weather sensitive classes where
residential gas revenues improved 24% for the third quarter and 15% for the
first nine months of 1996 compared to 1995 due to colder weather in 1996
and higher gas costs.  The commercial and industrial gas revenue improved
28% and 16%, respectively, in the third quarter and 19% and 32% in the
first nine months of 1996 over the same periods in 1995 due to both the
increase in gas costs and to more customers buying from CIPS in 1996 rather
than transporting their own gas.  Gas transportation revenues declined 6%
in the third quarter and 2% in the first nine months of 1996 reflecting the
increase in customers buying gas from the CIPS system.

<TABLE>
The changes in gas revenues and therm sales are shown below.

                               CHANGES IN GAS REVENUE AND THERM SALES
                                  INCREASE (DECREASE) FROM PRIOR YEAR
                                            (in thousands)
               _______________________________________    _____________________________________
                             Third Quarter                            Nine Months
               _______________________________________    _____________________________________
               Revenue     Rev %     Therms    Therms     Revenue     Rev %    Therms    Therms
                                                 %                                         %
               ________    _____     ______    ______     ________    _____    ______    ______
<S>            <C>         <C>       <C>       <C>        <C>         <C>      <C>       <C>
Residential    $  1,816     24 %        761      8 %      $  8,385     15 %    15,245      16 %
Commercial          701     28          239      6           3,536     19       6,191      19
Industrial          266     16       (1,789)   (30)          1,908     32       2,992      16
Transportation     (100)    (6)     (10,018)   (28)           (101)    (2)    (11,237)    (11)
Miscellaneous         4     11            -      -              29     10           -       -
               ________              ______               ________             ______
  Total        $  2,687     20 %    (10,807)   (20)%      $ 13,757     16 %    13,191       5 %
               ========              ======               ========             ======
</TABLE>
OPERATIONS
__________

Fuel for electric generation increased 10% in the third quarter and 15% in
the first nine months of 1996 compared to the same periods in 1995.  The
increases correspond to increases in KWH generation of 6% and 12%
respectively.

Purchased power costs declined 22% for the third quarter and 12% for the
first nine months ended September 30, 1996 compared with the same periods
in 1995 reflecting reduced purchases for native load and decreases in
market purchases made for resale to interchange economy and emergency
customers.

Gas costs increased 44% for the third quarter and 25% for the first nine
months of 1996 when compared to the same periods in 1995 due to increased
gas requirements for the CIPS system and because of a higher average cost
per therm for purchased gas.

Other operation expenses increased 2% in the third quarter of 1996 compared
to the same period in 1995 due to increases in customer accounting and
collection expenses between periods.  Other operation expenses declined 6%
in the first nine months of 1996 compared to 1995 primarily due to a $5.8
million charge in February 1995 relating to the cost of a workforce
reduction program.

Maintenance expenses declined 25% for the third quarter of 1996 and 8% for
the first nine months of 1996 compared to the same periods of 1995 due
primarily to the scheduled timing of power plant maintenance projects
between periods.

Depreciation and amortization expense increased 3% in the third quarter and
4% for the first nine months of 1996 when compared to 1995 due to normal
plant additions.

Taxes other than income taxes declined 4% in the third quarter and
increased 1% in the first nine months of 1996 when compared to 1995 due to
changes in revenue taxes which fluctuate according to sales.  These revenue
taxes are collected from customers in gas and electric revenues.

Other interest charges in the third quarter and the first nine months of
1996 includes an interest payment of $1.6 million in settlement of prior
years income tax liability.  Also contributing to the increase in other
interest for 1996 compared to the same periods in 1995 is interest on short-
term borrowings.

Miscellaneous, net is less favorable in both the third quarter and first
nine months of 1996 compared to the same periods in 1995 due to merger-
related expenses.

Significant changes in the balance sheet accounts at September 30, 1996
compared to balances at December 31, 1995 are:

Gas stored underground, at average cost, increased 45% during the first
nine months due to normal summer replenishment of stored gas prior to the
winter heating season.

Accounts payable declined 29% during the nine months principally due to
lower payable balances in purchased gas, fuel and purchased power.

Other current liabilities increased 43% for the first nine months of 1996
due primarily to postretirement medical costs accrued monthly but not
funded until year-end.

                        PART II.  OTHER INFORMATION


Item 5.  Other Information

  (1)    Reference is made to the third full paragraph under Item 1.
         Business - Competition -- Electric Business on page 11 in the
         1995 Form 10-K and to paragraph (2) under Item 5. Other
         Information in Part II on page 21 of the Second Quarter 1996 Form
         10-Q for information regarding proposed "open access" programs
         filed with the Illinois commission by two neighboring electric
         utilities and the approval sought by CIPS.  On March 18, 1996,
         CIPS filed a petition with the Illinois commission seeking
         authorization to participate in the approved experimental "open
         access" programs as a potential supplier.  CIPS received approval
         from the Illinois commission on August 7, 1996.

  (2)    Reference is made to the last paragraph under Item 1. Business -
         Employees on page 23 in the 1995 Form 10-K and to paragraph (3)
         under Item 5. Other Information in Part II on page 21 of the
         Second Quarter 1996 Form 10-Q for information regarding the
         workforce of CIPS, contracts with those employees represented by
         labor unions and labor negotiations.  Management completed
         negotiations with IBEW-702, the labor union which represents
         approximately 900 employees, resulting in a new three-year
         contract ratified by union members to be effective through June
         30, 1999.

  (3)    AMEREN CORPORATION -- Unaudited Pro Forma Combined Condensed
         Financial Information of CIPSCO and Union Electric Company.

          On August 11, 1995, CIPSCO and Union Electric Company ("UE")
          entered into an Agreement and Plan of Merger, which was
          subsequently approved by the shareholders of both parties.  The
          merger ("Merger") is further conditioned on, among other things,
          receipt of regulatory and governmental approvals, and will result 
          in a newly formed holding company, Ameren Corporation. The following
          unaudited pro forma financial information combines the historical 
          balance sheets and statements of income of CIPSCO and Union Electric, 
          including their respective subsidiaries, after giving effect to the 
          Merger.  The unaudited pro forma combined condensed balance sheet at
          September 30, 1996 gives effect to the Merger as if it had
          occurred at September 30, 1996.  The unaudited pro forma combined
          condensed statements of income for the nine-month periods ended
          September 30, 1996 and 1995, and the twelve-month period ended
          September 30, 1996 give effect to the Merger as if it had
          occurred at the beginning of the periods presented.  These
          statements are prepared on the basis of accounting for the Merger
          as a pooling of interests and are based on the assumptions set
          forth in the notes thereto.  In addition, the pro forma financial
          information does not give effect to the expected synergies of the
          transaction.

          The following pro forma financial information has been prepared
          from, and should be read in conjunction with, the historical
          financial statements and related notes thereto of CIPSCO and
          Union Electric.  The following information is not necessarily
          indicative of the financial position or operating results that
          would have occurred had the Merger been consummated on the date,
          or at the beginning of the periods, for which the Merger is being
          given effect nor is it necessarily indicative of future operating
          results or financial position.  In addition, due to the effect of
          weather on sales and other factors which are characteristic of
          public utility operations, financial results for the nine-month
          periods ended September 30, 1996 and 1995 are not necessarily
          indicative of trends for any twelve-month period.

          Also see Part I, Item 2., Management's Discussion and Analysis of
          Financial Condition and Results of Operations.

<TABLE>
                            AMEREN CORPORATION
                  UNAUDITED PRO FORMA COMBINED CONDENSED
                               BALANCE SHEET
                           AT SEPTEMBER 30, 1996
                          (Thousands of Dollars)


                                                          As Reported (Note 1)           Pro Forma
                                                      ___________________________      Adjustments       Pro Forma
                                                          UE             CIPSCO        (Notes 2, 9)       Combined
                                                      ___________      __________      ____________      ___________
<S>                                                   <C>              <C>             <C>               <C>
ASSETS
Property and plant
  Electric                                            $ 8,580,945      $ 2,355,551        $ 374,452      $11,310,948
  Gas                                                     181,899          236,594                -          418,493
  Other                                                    35,959                -                -           35,959
                                                      ___________      ___________      ___________      ___________
                                                        8,798,803        2,592,145          374,452       11,765,400
  Less accumulated depreciation and amortization        3,633,370        1,184,008          265,107        5,082,485
                                                      ___________      ___________      ___________      ___________
                                                        5,165,433        1,408,137          109,345        6,682,915

  Construction work in progress:
    Nuclear fuel in process                               115,960                -                -          115,960
    Other                                                  64,990           61,546            3,922          130,458
                                                      ___________      ___________      ___________      ___________
         Total property and plant, net                  5,346,383        1,469,683          113,267        6,929,333
Regulatory assets:
  Deferred income taxes (Note 6)                          696,852           42,479                -          739,331
  Other                                                   181,855           12,505                -          194,360
                                                      ___________      ___________      ___________      ___________
         Total regulatory assets                          878,707           54,984                -          933,691
Other assets:
  Unamortized debt expense                                 10,721            2,925              608           14,254
  Nuclear decommissioning trust fund                       85,629                -                -           85,629
  Investments in nonregulated activities                        -          110,808                -          110,808
  Other                                                    28,272           34,881           (3,284)          59,869
                                                      ___________      ___________      ___________      ___________
         Total other assets                               124,622          148,614           (2,676)         270,560
Current assets:
  Cash and temporary investments                           19,427           13,074            9,886           42,387
  Accounts receivable, net                                248,862           54,274           16,816          319,952
  Unbilled revenue                                         57,595           19,669                -           77,264
  Materials and supplies, at average cost -
    Fossil fuel                                            67,205           48,442            9,087          124,734
    Other                                                  99,305           39,827            4,540          143,672
  Other                                                    39,312           46,025            3,243           88,580
                                                      ___________      ___________      ___________      ___________
         Total current assets                             531,706          221,311           43,572          796,589
                                                      ___________      ___________      ___________      ___________
Total Assets                                          $ 6,881,418      $ 1,894,592       $  154,163      $ 8,930,173
                                                      ===========      ===========      ===========      ===========

CAPITAL AND LIABILITIES
Capitalization:
  Common stock (Note 2)                               $   510,619      $   356,812       $ (866,059)     $     1,372
  Other stockholders' equity (Note 2)                   1,896,212          310,978          866,059        3,073,249
                                                      ___________      ___________      ___________      ___________
         Total common stockholders' equity              2,406,831          667,790                -        3,074,621
  Preferred stock of subsidiary                           219,121           80,000                -          299,121
  Long-term debt                                        1,727,945          421,152          130,000        2,279,097
                                                      ___________      ___________      ___________      ___________
         Total capitalization                           4,353,897        1,168,942          130,000        5,652,839
Minority interest in consolidated subsidiary                    -                -            3,534            3,534
Accumulated deferred income taxes                       1,322,536          332,042           (6,810)       1,647,768
Accumulated deferred investment tax credits               161,886           49,722                -          211,608
Regulatory liability                                      206,991          109,421                -          316,412
Accumulated provision for nuclear decommissioning          87,302                -                -           87,302
Other deferred credits and liabilities                    152,517           33,210            4,753          190,480
Current liabilities:
  Current maturity of long-term debt                       76,490           58,000                -          134,490
  Short-term debt                                               -           53,991                -           53,991
  Accounts payable                                         73,082           42,851           16,951          132,884
  Wages payable                                            36,908           10,727                -           47,635
  Taxes accrued                                           238,882           12,700                8          251,590
  Interest accrued                                         53,154            8,785            2,864           64,803
  Other                                                   117,773           14,201            2,863          134,837
                                                      ___________      ___________      ___________      ___________
         Total current liabilities                        596,289          201,255           22,686          820,230
                                                      ___________      ___________      ___________      ___________
Total Capital and Liabilities                         $ 6,881,418      $ 1,894,592        $ 154,163      $ 8,930,173
                                                      ===========      ===========      ===========      ===========

See accompanying Notes to Unaudited Pro Forma Combined Condensed Financial
Statements.
</TABLE>

<TABLE>
                            AMEREN CORPORATION
                  UNAUDITED PRO FORMA COMBINED CONDENSED
                           STATEMENTS OF INCOME
                   NINE MONTHS ENDED SEPTEMBER 30, 1996
        (Thousands of Dollars Except Shares and Per Share Amounts)


                                                 UE               CIPSCO           Pro Forma
                                           (As Reported)       (As Reported)       Adjustments        Pro Forma
                                           (Notes 1,4,10)      (Notes 1,4,7)       (Notes 2,9)        Combined
                                            _____________       _____________      ____________      ____________
<S>                                         <C>                 <C>                <C>               <C>
OPERATING REVENUES:
  Electric                                   $  1,716,061        $   560,188       $  130,034        $  2,406,283
  Gas                                              68,277            101,280                -             169,557
  Other                                               341              7,464              971               8,776
                                             ____________        ___________       __________        ____________
       Total operating revenues                 1,784,679            668,932          131,005           2,584,616

OPERATING EXPENSES:
  Operations
    Fuel and purchased power                      387,038            205,023           68,671             660,732
    Gas Costs                                      42,455             60,227                -             102,682
    Other                                         279,714            107,486           13,322             400,522
                                             ____________        ___________       __________        ____________
                                                  709,207            372,736           81,993           1,163,936
  Maintenance                                     159,988             43,005           13,157             216,150
  Depreciation and amortization                   180,101             64,810           11,341             256,252
  Income taxes (Note 7)                           189,546             43,260            6,128             238,934
  Other taxes                                     166,463             43,505            1,503             211,471
                                             ____________        ___________       __________        ____________
       Total operating expenses                 1,405,305            567,316          114,122           2,086,743

OPERATING INCOME                                  379,374            101,616           16,883             497,873

OTHER INCOME AND DEDUCTIONS:
  Allowance for equity funds used during
    construction                                    4,960                196                -               5,156
  Minority interest in consolidated
    subsidiary                                          -                  -           (3,760)             (3,760)
  Miscellaneous, net                                 (361)            (2,874)          (5,528)             (8,763)
                                             ____________        ___________       __________        ____________
       Total other income and deductions,
         net                                        4,599             (2,678)          (9,288)             (7,367)

INCOME BEFORE INTEREST CHARGES
AND PREFERRED DIVIDENDS                           383,973             98,938            7,595             490,506

INTEREST CHARGES AND PREFERRED DIVIDENDS:
  Interest                                        100,589             27,876            7,595             136,060
  Allowance for borrowed funds used during
    construction                                   (5,669)              (250)               -              (5,919)
  Preferred dividends of subsidiaries
   (Note 8)                                         9,936              2,794                -              12,730
                                             ____________        ___________       __________        ____________
    Net interest charges and preferred
      dividends                                   104,856             30,420            7,595             142,871

NET INCOME                                   $    279,117        $    68,518       $        -        $    347,635
                                             ============        ===========       ==========        ============

EARNINGS PER SHARE OF COMMON STOCK
 (BASED ON AVERAGE SHARES OUTSTANDING)              $2.73              $2.01                                $2.53
                                                    =====              =====                                =====

AVERAGE COMMON SHARES OUTSTANDING (Note 2)    102,123,834         34,069,542        1,022,086         137,215,462
                                             ============        ===========       ==========        ============



See accompanying Notes to Unaudited Pro Forma Combined Condensed Financial
Statements.
</TABLE>

<TABLE>
                            AMEREN CORPORATION
                  UNAUDITED PRO FORMA COMBINED CONDENSED
                           STATEMENTS OF INCOME
                   NINE MONTHS ENDED SEPTEMBER 30, 1995
        (Thousands of Dollars Except Shares and Per Share Amounts)


                                                     UE                CIPSCO            Pro Forma
                                                (As Reported)       (As Reported)       Adjustments          Pro Forma
                                                  (Note 1)         (Notes 1,3,7)        (Notes 2,9)          Combined
                                                _____________       _____________       ____________       ____________
<S>                                             <C>                 <C>                 <C>                <C>
OPERATING REVENUES:
  Electric                                      $  1,718,620        $   544,886         $ 115,808          $  2,379,314
  Gas                                                 60,480             87,523                 -               148,003
  Other                                                  318              5,860               244                 6,422
                                                ____________        ___________         __________         ____________
       Total operating revenues                    1,779,418            638,269           116,052             2,533,739
OPERATING EXPENSES:
  Operations
    Fuel and purchased power                         385,740            189,447            51,527               626,714
    Gas costs                                         35,051             48,322                 -                83,373
    Other                                            277,491            113,897            14,452               405,840
                                                ____________        ___________         __________         ____________
                                                     698,282            351,666            65,979             1,115,927
  Maintenance                                        163,342             46,690            14,038               224,070
  Depreciation and amortization                      174,369             62,280            11,866               248,515
  Income taxes (Note 7)                              188,492             41,826             6,208               236,526
  Other taxes                                        166,944             43,133             1,496               211,573
                                                ____________        ___________         __________         ____________
       Total operating expenses                    1,391,429            545,595            99,587             2,036,611

OPERATING INCOME                                     387,989             92,674            16,465               497,128

OTHER INCOME AND DEDUCTIONS:
  Allowance for equity funds used during
    construction                                       4,758                600                 -                 5,358
  Minority interest in consolidated
   subsidiary                                              -                  -            (3,396)               (3,396)
  Miscellaneous, net                                  (8,772)             1,915            (5,153)              (12,010)
                                                ____________        ___________         __________         ____________
       Total other income and deductions,
         net                                          (4,014)             2,515            (8,549)              (10,048)

INCOME BEFORE INTEREST CHARGES
AND PREFERRED DIVIDENDS                              383,975             95,189             7,916               487,080

INTEREST CHARGES AND PREFERRED DIVIDENDS:
  Interest                                           101,770             25,157             7,916               134,843
  Allowance for borrowed funds used during
    construction                                      (4,661)               (49)                -                (4,710)
  Preferred dividends of subsidiaries
    (Note 8)                                           9,938              2,896                 -                12,834
                                                ____________        ___________         __________         ____________
    Net interest charges and preferred
      dividends                                      107,047             28,004             7,916               142,967

NET INCOME                                      $    276,928        $    67,185         $       -          $    344,113
                                                ============        ===========         ==========         ============

EARNINGS PER SHARE OF COMMON STOCK
 (BASED ON AVERAGE SHARES OUTSTANDING)                 $2.71              $1.97                                   $2.51
                                                       =====              =====                                   =====

AVERAGE COMMON SHARES OUTSTANDING (Note 2)       102,123,834         34,069,542          1,022,086          137,215,462
                                                ============        ===========         ==========         ============



See accompanying Notes to Unaudited Pro Forma Combined Condensed Financial
Statements.
</TABLE>

<TABLE>
                            AMEREN CORPORATION
                  UNAUDITED PRO FORMA COMBINED CONDENSED
                           STATEMENTS OF INCOME
                  TWELVE MONTHS ENDED SEPTEMBER 30, 1996
        (Thousands of Dollars Except Shares and Per Share Amounts)


                                                     UE                    CIPSCO               Pro Forma
                                                (As Reported)           (As Reported)           Adjustments           Pro Forma
                                                (Notes 1,4,10)         (Notes 1,3,4,7)          (Notes 2,9)           Combined
                                                _____________          _______________          ____________          ____________
<S>                                             <C>                    <C>                      <C>                   <C>         
OPERATING REVENUES:
  Electric                                      $  2,151,551             $   718,785               $ 170,168          $  3,040,504
  Gas                                                 95,610                 143,363                       -               238,973
  Other                                                  464                  10,777                   1,081                12,322
                                                ____________             ___________            ____________          ____________
       Total operating revenues                    2,247,625                 872,925                 171,249             3,291,799

OPERATING EXPENSES:
  Operations
    Fuel and purchased power                         506,113                 263,801                  88,054               857,968
    Gas costs                                         58,655                  85,959                       -               144,614
    Other                                            370,093                 148,958                  18,018               537,069
                                                ____________             ___________            ____________          ____________
                                                     934,861                 498,718                 106,072             1,539,651
  Maintenance                                        218,255                  64,311                  17,060               299,626
  Depreciation and amortization                      238,969                  85,792                  15,222               339,983
  Income taxes (Note 7)                              210,595                  47,206                   7,778               265,579
  Other taxes                                        211,664                  56,985                   1,918               270,567
                                                ____________             ___________            ____________          ____________
       Total operating expenses                    1,814,344                 753,012                 148,050             2,715,406

OPERATING INCOME                                     433,281                 119,913                  23,199               576,393

OTHER INCOME AND DEDUCTIONS:
  Allowance for equity funds used during
    construction                                       7,028                     486                       -                 7,514
  Minority interest in consolidated
    subsidiary                                             -                       -                  (4,921)               (4,921)
  Miscellaneous, net                                   2,430                  (7,088)                 (8,283)              (12,941)
                                                ____________             ___________             ____________         ____________
       Total other income and deductions,
         net                                           9,458                  (6,602)                (13,204)              (10,348)

INCOME BEFORE INTEREST CHARGES
AND PREFERRED DIVIDENDS                              442,739                 113,311                   9,995               566,045

INTEREST CHARGES AND PREFERRED DIVIDENDS:
  Interest                                           133,559                  36,489                   9,995               180,043
  Allowance for borrowed funds used during
    construction                                      (7,114)                   (274)                      -                (7,388)
  Preferred dividends of subsidiaries
    (Note 8)                                          13,249                   3,748                       -                16,997
                                                ____________             ___________             ___________          ____________
    Net interest charges and preferred
      dividends                                      139,694                  39,963                   9,995               189,652

NET INCOME                                      $    303,045             $    73,348             $         -          $    376,393
                                                ============             ===========             ===========          ============

EARNINGS PER SHARE OF COMMON STOCK
 (BASED ON AVERAGE SHARES OUTSTANDING)                 $2.97                   $2.15                                         $2.74
                                                       =====                   =====                                         =====

AVERAGE COMMON SHARES OUTSTANDING (Note 2)       102,123,834              34,069,542               1,022,086           137,215,462
                                                ============             ===========             ===========          ============



See accompanying Notes to Unaudited Pro Forma Combined Condensed Financial
Statements.
</TABLE>

                           AMEREN CORPORATION

  NOTES TO UNAUDITED PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS



1. Reclassifications have been made to certain "as reported" account
   balances reflected in CIPSCO's and Union Electric's financial statements to
   conform to this reporting presentation (See Notes 6, 7 and 8).  All other
   financial statement presentation and accounting policy differences are
   immaterial and have not been adjusted in the pro forma combined condensed
   financial statements.

2. The pro forma combined condensed financial statements reflect the
   conversion of each share of Union Electric Common Stock ($5 par value)
   outstanding into one share of Ameren Common Stock ($.01 par value) and the
   conversion of each share of CIPSCO Common Stock (no par value) outstanding
   into 1.03 shares of Ameren Common Stock, as provided in the Merger
   Agreement.  The pro forma combined condensed financial statements are
   presented as if the companies were combined during all periods included
   therein.

3. Net income for the twelve months ended September 30, 1996
   includes CIPSCO's pre-tax write-off of $5.7 million of system development
   expenses.  Net income for the nine months ended September 30, 1995
   includes CIPSCO's pre-tax charges of $5.8 million for a voluntary
   separation program.

4. The allocation between Union Electric and CIPSCO and their customers
   of the estimated cost savings resulting from the Merger, net of the costs
   incurred to achieve such savings, will be subject to regulatory review and
   approval.  Merger-related costs (which include transaction costs and costs
   to achieve such savings) are currently estimated to be approximately
   $73 million (including costs for financial advisors, attorneys, accountants,
   consultants, filings, printing, system integration, relocation, etc.).
   None of these estimated cost savings have been reflected in the pro forma
   combined condensed financial statements.  However, net income for the nine
   months and twelve months ended September 30, 1996 included merger-related
   costs of $5.3 million, net of income taxes, for Union Electric and $4.5
   million and $9.3 million, net of income taxes, for CIPSCO, respectively.
   Net income for the nine months ended September 30, 1995 included
   merger-related costs of $9.0 million, net of income taxes, for Union
   Electric.

5. Intercompany transactions (including purchased and exchanged power
   transactions) between Union Electric and CIPSCO during the periods
   presented were not material and, accordingly, no pro forma adjustments were
   made to eliminate such transactions.

6. CIPSCO's regulatory asset related to deferred income taxes was
   reclassified from the regulatory liability account balance to conform to
   this reporting presentation.

7. CIPSCO's income taxes are reflected as operating expenses to conform
   to this reporting presentation.

8. Currently, the Union Electric Preferred Stock is not issued by a
   subsidiary; subsequent to the Merger, the Union Electric Preferred Stock
   will be issued by a subsidiary of Ameren.  As a result, Union Electric's
   preferred dividend requirements have been reclassified to conform to this
   reporting presentation.

9. Pro forma adjustments have been made to consolidate the financial
   results of Electric Energy, Inc. (EEI), which will, in substance, be a 60%
   owned subsidiary of Ameren subsequent to the Merger. Union Electric and
   CIPSCO hold 40% and 20% ownership interests, respectively, in EEI and
   account for these investments under the equity method of accounting.  All
   intercompany transactions between Union Electric, CIPSCO and EEI have been
   eliminated.

10.Net income for the nine months ended September 30, 1995 includes a
   credit to Missouri electric customers which reduced revenues and pre-tax
   income of Union Electric by $30 million.  Net income for the nine and
   twelve months ended September 30, 1996 includes credits for Missouri
   electric customers which reduced revenues and pre-tax income of Union
   Electric by $45 million.

Item 6.  Exhibits and Reports on Form 8-K

  (A)    Exhibits:

    Exhibit 10                      Amendment No. 2 to Form of Excess
                                    Benefit Plan (Filed electronically)

    Exhibit 12                      Computation of Ratio of Earnings to
                                    Fixed Charges and Computation of Ratio
                                    of Earnings to Fixed Charges plus
                                    Preferred Stock Dividend Requirements
                                    Before Income Taxes for CIPS.

    Exhibit 27.1                    Financial Data Schedule for CIPSCO
                                    (required for electronic filing only in
                                    accordance with Item 601(c)(1) of
                                    Regulation S-K).

    Exhibit 27.2                    Financial Data Schedule for CIPS
                                    (required for electronic filing only
                                    in accordance with Item 601(c)(1) of
                                    Regulation S-K).

  (B)    Reports on Form 8-K:

        None.

                               SIGNATURE



Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant, CIPSCO Incorporated, has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.

                               CIPSCO Incorporated




Date:  November 14, 1996        /s/  F. J. Kinsinger
                       _______________________________________
                                   F. J. Kinsinger
                                     Controller
                              (Chief Accounting Officer)

                               SIGNATURE



Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant, Central Illinois Public Service Company, has duly caused this
report to be signed on its behalf by the undersigned thereunto duly
authorized.

                       Central Illinois Public Service Company




Date:  November 14, 1996        /s/  F. J. Kinsinger
                       _______________________________________
                                   F. J. Kinsinger
                                     Controller
                             (Principal Accounting Officer)

                          CIPSCO INCORPORATED AND
                  CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
                        EXHIBIT INDEX TO FORM 10-Q
                 FOR THE QUARTER ENDED SEPTEMBER 30, 1996




Exhibit No.              Description
___________              ___________

   Exhibit 10       Amendment No. 2 to Form of Excess Benefit Plan

   Exhibit 12       Computation of Ratio of Earnings to Fixed Charges and
                    Computation of Ratio of Earnings to Fixed Charges
                    plus Preferred Stock Dividend Requirements Before
                    Income Taxes for CIPS.

   Exhibit 27.1     Financial Data Schedule for CIPSCO

   Exhibit 27.2     Financial Data Schedule for CIPS