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 June 30, 1997

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

        For the transition period from         to        .

                                   
                    Commission file number: 1-3203

                        CHESAPEAKE CORPORATION

        Incorporated under the                    I.R.S. Employer 
        laws of Virginia                          Identification
                                                  No. 54-0166880


                        1021 East Cary Street
                            P. O. Box 2350
                    Richmond, Virginia 23218-2350
                   Telephone Number (804) 697-1000


Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the Registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.   Yes  X   . 
 No     .

The number of shares outstanding of each of the issuer's classes of
common stock, as of the close of period covered by this report:

           Common stock of $1 par value, 23,555,350 shares.



                                              Page 1 of 24 Pages.




                                 PART I
<TABLE>
Item 1.  Financial Statements.

                  CHESAPEAKE CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED STATEMENT OF INCOME
               FOR THE SECOND QUARTER AND YEAR TO DATE ENDED
                          JUNE 30, 1997 AND 1996 
<CAPTION>
<S>                                <C>        <C>       <C>     <C>
                                   Second Quarter      Year to Date
                                   1997      1996      1997    1996
                                 (In millions, except per share data)

<S>                               <C>       <C>       <C>      <C>          
Net sales                              $264.3    $276.6    $558.8  $554.3
Costs and expenses:
  Cost of products sold                 201.3     203.2     424.9   405.2
  Depreciation and cost 
   of timber harvested                   19.8      21.9      46.5    43.8
  Selling, general and 
   administrative expenses               41.2      37.8      82.5    74.3
  Restructuring/special charges          18.9                 -        18.9       -

    Income (loss) from operations       (16.9)     13.7     (14.0)        31.0

Gain on sale of businesses               86.3    -           86.3  -
Other income and expenses, net            2.1       1.2       3.1          4.1
Interest expense, net                    (6.8)     (8.4)    (16.3)       (16.2)

    Income before taxes and
      extraordinary item                 64.7       6.5      59.1    18.9

Income taxes                             27.6       2.6      25.5     7.1
    Income before extraordinary
      item                               37.1       3.9      33.6         11.8
Extraordinary item, net of income
 tax                                     (2.3)               -     (2.3)     -
                                           
    Net income                          $34.8     $ 3.9     $31.3   $11.8

Per share:
   Earnings before extraordinary
     item                               $1.57     $ .17     $1.42        $ .50
   Extraordinary item, net of 
     income taxes                        (.10)              -       (.10)    -
   Earnings                             $1.47     $ .17     $1.32        $ .50
                                          
Weighted average number of 
  common shares and 
  equivalents outstanding                23.8      23.7      23.7    23.8
                                           
Cash dividends declared per
  share of common stock                 $ .20     $ .20     $ .40        $ .40
      
</TABLE>
                          See accompanying notes.<TABLE>
                  CHESAPEAKE CORPORATION AND SUBSIDIARIES
                        CONSOLIDATED BALANCE SHEET

<CAPTION>
<S>                                     <C>                <C>
                                       June 30, 1997       Dec. 31, 1996
                                                  (In millions)

       ASSETS
<S>                                   <C>                     <C>
Current assets:
    Cash and cash equivalents              $   253.4               $   9.8
    Accounts receivable, less
      allowances for doubtful
      accounts of $5.4 and $4.7                116.3                 153.9
    Inventories, at lower of cost
      or market                                 99.9                 134.4
    Deferred income taxes                       16.5                  16.5
    Other                                        8.8                  11.2

      Total current assets                     494.9                 325.8



Property, plant and equipment, at cost:
    Land, buildings, machinery
      and equipment                            793.3               1,580.0
    Less accumulated depreciation             (332.4)               (756.3)

                                               460.9                 823.7


    Timber and timberlands, net                 39.6                  39.8

  Net property, plant and equipment            500.5                 863.5


Goodwill, net                                   43.8                  58.3


Other assets                                    38.7                  42.6


                                            $1,077.9              $1,290.2


</TABLE>






<TABLE>



<S>                                         <C>             <C>
                                           June 30, 1997   Dec. 31, 1996
                                                   (In millions)

    LIABILITIES AND STOCKHOLDERS' EQUITY
<S>                                        <C>             <C>
Current liabilities:
  Accounts payable and accrued expenses         $  146.9        $  157.6 
  Current maturities of long-term debt                .9             3.9
  Dividends payable                                  4.7             4.7
  Income taxes payable                              85.6             0.6


      Total current liabilities                    238.1           166.8


Long-term debt                                     265.5           499.4

Postretirement benefits other than 
  pensions                                          16.4            28.0

Deferred income taxes                               64.4           126.9
 


Stockholders' equity:
  Preferred stock, $100 par value,
    issuable in series;
    authorized, 500,000 shares;
    issued, none                                      
  Common stock, $1 par value;
    authorized 60,000,000 shares;
    outstanding 23,555,350 and
    23,398,137 shares                               23.6            23.4
  Additional paid-in capital                       100.9            97.2
 Foreign currency translation adjustment            (1.3)         -
  Retained earnings                                370.3           348.5

                                                   493.5           469.1

                                                $1,077.9        $1,290.2

</TABLE>

                          See accompanying notes.



<TABLE>
                     CHESAPEAKE CORPORATION AND SUBSIDIARIES
                       CONSOLIDATED STATEMENT OF CASH FLOWS
                FOR THE YEAR TO DATE ENDED JUNE 30, 1997 AND 1996
<CAPTION>                                                 <C>       <C>  
                                                            1997      1996  
<S>                                                          (In millions)
Operating activities                                     <C>       <C>
  Net income                                               $ 31.3    $ 11.8 
  Adjustments to reconcile net income to net cash
   provided by operating activities:
    Depreciation, cost of timber harvested and
     amortization of intangibles                             48.2      45.2
    Deferred income taxes                                   (62.5)      3.3
    (Gain) on sale of property, plant and equipment          ( .6)     ( .1)
    (Gain) on sale of businesses                            (86.3)      -
    Restructuring/special charges                            18.9       -
    Extraordinary item                                        4.0       -
    Changes in operating assets and liabilities,
     net of acquisitions:
       Accounts receivable                                   (6.1)    ( 2.3)
       Inventories                                           (5.6)      5.0 
       Other assets                                           5.5       - 
       Accounts payable and accrued expenses                 18.6       8.9 
       Income taxes payable                                  78.2      (5.3)
       Other payables                                         2.6       1.3  

  Net cash provided by operating activities                  46.2      67.8

Investing activities
  Purchases of property, plant and equipment                (32.1)    (75.7)
  Acquisitions                                               ( .3)    (30.8)
  Proceeds from sale of property, plant and equipment          .7        .2
  Proceeds from sale of businesses, net of disposition
   expenses                                                 472.7       -
  Other                                                      (2.3)       .9
  
  Net cash provided by (used in) investing activities       438.7    (105.4)

Financing activities
  Net borrowings (payments) on credit lines                (169.0)     62.7    
  Payments on long-term debt                                (63.6)     (4.0)
  Proceeds from long-term debt                                 .1        .3
  Proceeds from issuances of common stock                      .6       -   
  Purchase of outstanding common stock                        -       (12.1)
 Dividends                                                   (9.4)     (9.5)
 
  Net cash provided by (used in) financing activities      (241.3)     37.4

  Increase (decrease) in cash                               243.6      ( .2)

Cash at beginning of period                                   9.8       5.2
  Cash at end of period                                    $253.4     $ 5.0

Supplemental cash flow information:
  Interest payments                                         $21.1     $15.9

  Income tax payments, net of refunds                       $ 1.8     $ 8.9

</TABLE>
                            See accompanying notes.   





                CHESAPEAKE CORPORATION AND SUBSIDIARIES
          NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


1. The condensed consolidated financial statements of Chesapeake
   Corporation and subsidiaries (the "Company") included herein are
   unaudited, except for the December 31, 1996 consolidated balance
   sheet, and have been prepared by the Company pursuant to the rules
   and regulations of the Securities and Exchange Commission. In the
   opinion of management, the condensed consolidated financial
   statements reflect all adjustments, all of a normal recurring
   nature, necessary to present fairly the Company's consolidated
   financial position, results of operations and cash flows. These
   condensed consolidated financial statements should be read in
   conjunction with the consolidated financial statements and the
   notes thereto included or incorporated by reference in the
   Company's latest Annual Report on Form 10-K.  The results of
   operations for the 1997 interim period should not be regarded as
   necessarily indicative of the results that may be expected for the
   entire year. 

   In February, 1997, the Financial Accounting Standards Board issued
   Statement of Financial Accounting Standards No. 128, "Earnings Per
   Share."  This standard, which is effective for financial statements
   issued for periods ending after December 15, 1997, simplifies the
   computation of earnings per share ("EPS") by replacing the
   presentation of primary EPS with a presentation of basic EPS. 
   This standard requires dual presentation of basic and diluted EPS
   by entities with complex capital structures.  Basic EPS includes
   no dilution, while diluted EPS reflects potential dilution of
   securities that could share in the earnings of an entity.  The
   Company does not expect the impact of this standard to be material
   to its financial statements or earnings.

   In February, 1997, the Financial Accounting Standards Board issued
   Statement of Financial Accounting Standards No. 129, "Disclosure of
   Information about Capital Structure."  This standard, which is
   effective for financial statements for periods ending after
   December 15, 1997, establishes standards for disclosing
   information about an entity's capital structure, including rights
   and privileges of the various securities outstanding.  The Company
   does not expect the impact of this statement to be material to its
   financial statements.

    In June, 1997, the Financial Accounting Standards Board issued
    Statement of Financial Accounting Standards No. 130, "Reporting
    Comprehensive Income."  This standard, which is effective for
    fiscal years beginning after December 15, 1997, requires the
    reporting of comprehensive income and its components in a full set
    of general-purpose financial statements in a statement displayed
    with the same prominence as other financial statements.
    Comprehensive income includes all changes in equity during a
    period except those resulting from investment by owners or
    distributions to owners.  This includes items that now bypass the
    income statement and are shown as a separate component of equity. 
    The Company does not expect the impact of this statement to be
    material to its financial statements or earnings.

    In June, 1997, the Financial Accounting Standards Board issued
    Statement of Financial Accounting Standards No. 131, "Disclosure
    about Segments of an Enterprise and Related Information."  This
    standard, which is effective for financial statements for periods
    beginning after December 15, 1997, establishes standards for the
    way that public business enterprises report information about
    operating segments in annual financial statements and requires
    that selected operating segment information be reported in interim
    financial statements.  It also establishes standards for related
    disclosures about products and services, geographic areas, and
    major customers.  Segments are generally required to be reported
    based on the way management internally organizes its segments for
    making operating decisions and assessing performance.  While more
    disclosure and descriptive information will be required regarding
    its operating segments, the Company already uses the "management"
    approach in reporting its segments and includes certain segment
    information with its interim financial statements.
<TABLE>
2.  Inventories:
<CAPTION>                               June 30, 1997   Dec. 31, 1996
                                                (In millions)
<S>                                         <C>             <C>
    Inventories consist of:
       Finished goods                           $ 36.4          $ 44.1
       Work-in-process                            31.9            35.9
       Materials and supplies                     31.6            54.4

          Totals                                $ 99.9          $134.4
</TABLE>                            
3. Commitments:

   At June, 30, 1997, commitments, primarily for capital
   expenditures, approximated $54 million.  These commitments include
   anticipated expenditures of $2 million in 1997 for environmental
   protection related to planned expansions and upgrades primarily at
   the Company's paper mills in Arizona and  Wisconsin.  The
   remaining commitments of $52 million are primarily for various
   capital projects, none of which is individually material.

   Additional non-determinable environmental protection expenditures
   could be required in the future if facilities are expanded or if
   more stringent standards become applicable.  See Note 6.

4. Litigation:

   Wisconsin Tissue ("WT"), a wholly-owned subsidiary of the Company,
   has been identified by the federal government and the state of
   Wisconsin as a potentially responsible party with respect to
   possible natural resource damages in the Fox River and Green Bay
   System.  See Note 6 for further information regarding this notice.

   On May 13, 1997, the Attorney General of Florida filed a civil
   complaint against WT alleging violations of antitrust laws.  The
   complaint also sues nine other commerical and industrial tissue
   manufacturers and seeks compensatory monetary damages, civil
   penalties, and injunctive relief.  At least 27 other private civil
   antitrust class actions have also been filed against WT (or
   against the Company, identifying WT as a "division" of the
   Company), and against the other defendants.  No discovery has been
   conducted to date.  WT and the Company believe that they have
   vaild defenses to the plaintiffs' claims, and they intend to
   defend the actions vigorously.

   The Company is a party to various other legal actions which are ordinary
   and incidental to its business.

   While the outcome of legal actions cannot be predicted with
   certainty, the Company believes the outcome of any of these
   proceedings, or all of them combined, will not have a materially
   adverse effect on its consolidated financial position or results
   of operations.

5. Income Taxes:

   The Company's effective income tax rate was 43.2% for the first
   two quarters of 1997 compared to 37.5% for the first two quarters
   of 1996. The differences between the Company's effective income
   tax rate and the statutory federal income tax rate are primarily
   due to state income taxes and purchase accounting adjustments
   resulting from one-time second quarter dispositions and
   restructuring charges and from acquisitions.

6. Environmental Matters:

   Chesapeake has a strong commitment to protecting the environment. 
   The Company has an environmental audit program to monitor
   compliance with environmental laws and regulations. The Company is
   committed to abiding by the environmental, health and safety
   principles of the American Forest & Paper Association.  Each
   expansion project has been planned to comply with applicable 



   environmental regulations and to enhance environmental protection
   at existing facilities.  The Company faces increasing capital
   expenditures and operating costs to comply with expanding and more
   stringent environmental regulations, although compliance with
   existing environmental regulations is not expected to have a
   materially adverse effect on the Company's earnings, financial
   position, or competitive position. 

   The Comprehensive Environmental Response, Compensation and
   Liability Act ("CERCLA") and similar state "superfund" laws impose
   liability, without regard to fault or to the legality of the
   original action, on certain classes of persons (referred to as
   potentially responsible parties or "PRPs") associated with a
   release or threat of a release of hazardous substances into the
   environment.  Financial responsibility for the clean-up or other 

6. Environmental Matters (continued):

   remediation of contaminated property or for natural resource
   damages can extend to previously owned or used properties,
   waterways, and properties owned by third parties, as well as to
   properties currently owned and used by a company even if
   contamination is attributable entirely to prior owners.  The U.S.
   Environmental Protection Agency ("EPA") has given notice of its
   intent to list the lower Fox River in Wisconsin on the National
   Priorities List under CERCLA and has identified WT as a possible
   PRP.  Except for matters involving the Fox River which are
   discussed below, the Company is not presently named as a PRP at
   any CERCLA-related sites.  However, there can be no assurance that
   the Company will not be named as a PRP at any other sites in the
   future, or that the costs associated with additional sites would
   not be material to the Company's financial position or results of
   operation.

   In June 1994, the FWS, a federal natural resources trustee,  notified
   WT that it had identified WT and four other companies located along the
   lower Fox River in northeast Wisconsin as PRPs for purposes of natural
   resources liability under CERCLA arising from alleged releases of
   polychlorinated biphenyls ("PCBs") in the Fox River and Green Bay System.
   Two other companies subsequently received similar notice from the FWS. The
   FWS and other governmental and tribal entities, including the
   State of Wisconsin, allege that natural resources, including
   endangered species, fish, birds, tribal lands, or lands held by
   the United States in trust for various Indian tribes, have been
   exposed to PCBs that were released from facilities located along
   the lower Fox River.  The FWS is proceeding with a natural
   resource damage assessment with respect to the alleged discharges
   and; on January 31, 1997, the FWS notified WT of its intent to
   file suit, subject to final approval by the Department of Justice,
   against WT to recover alleged  natural resource damages.  WT and
   other PRPs are engaged in discussions with the parties asserting
   federal trusteeship of the natural resources concerning the damage
   assessment and the basis for resolution of the federal natural
   resource damage claims.

   WT and other PRPs are also engaged in discussions with the State
   of Wisconsin with respect to resolving possible state claims
   concerning remediation, restoration, and natural resource damages
   related to the alleged discharge of PCBs into the Fox River and
   Green Bay System.  On January 31, 1997, the PRPs signed an interim
   partial settlement with the State of Wisconsin under which the
   PRPs will provide funds for an interim phase of resource damage
   assessment and restoration work.  WT's obligation under the
   interim settlement would not be material to the Company's
   financial position or results of operations.  

   On June 18, 1997, EPA announced that it was initiating the process
   of listing the lower Fox River on the CERCLA National 
   Priorities List of hazardous waste sites.  EPA identified several 

6. Environmental Matters (continued):

   possible PRP's including WT.  EPA has requested the participation
   of the PRP's in performing a remedial investigation/feasibility
   study of the lower Fox River site.  WT and other PRP's are in the
   process of preparing a response to EPA's request. 

   The ultimate cost to WT, if any, associated with this matter
   cannot be predicted with certainty at this time, due to: the
   inability to determine the outcome of pending settlement
   discussions or, if a settlement cannot be reached, WT's share of
   any multi-party clean-up; the uncertain extent of any
   contamination; the varying costs of alternative restoration
   methods; the evolving nature of clean-up technologies and
   governmental regulations; the lack of controlling legal precedent;
   the extent to which contribution will be available from other
   parties; and the scope of potential recoveries from insurance
   carriers and prior owners of WT.  Based on presently available
   information, the Company believes that there are additional
   parties, some of which may have substantial resources, that may
   also be identified as PRPs with respect to this matter and could
   be expected to participate in any final settlement. The Company
   believes that it is entitled to indemnification from a prior owner
   of WT, pursuant to a stock purchase agreement between the parties,
   with respect to all liabilities related to this matter.  The prior
   owner has reimbursed WT for out-of-pocket costs and attorneys'
   fees related to investigation of the matter.  The Company believes 
   that the prior owner intends to, and has the financial ability 
   to, honor its indemnification obligation under the stock purchase
   agreement.

   In March 1995, the United States Environmental Protection Agency
   ("EPA") issued "Final Guidance" for basin-wide water quality
   standards pursuant to the Great Lakes Water Quality Agreement
   between the U.S. and Canada regarding the development of water
   quality standards for the Great Lakes and their tributaries.  The
   State of Wisconsin is in the process of modifying state
   regulations to comply with the Final Guidance.  Assuming state
   approval, compliance with the modified state regulations will be
   required as early as the third quarter of 1997. Based on the
   regulations as presently proposed by Wisconsin, WT does not
   anticipate significant capital expenditures or additional
   operating costs as a result of complying with the modified
   regulations. 

   The EPA has published draft rules under the Clean Water Act and
   the Clean Air Act which would impose new air and water quality
   standards for pulp and paper mills (the "Cluster Rules").  The
   definitive Cluster Rules, when promulgated, are expected to
   require compliance within three years after the date of adoption.
   Based on the Company's preliminary estimates, if the Cluster Rules
   were adopted in substantially the form currently proposed,
   compliance would require capital expenditures totaling not more
   than approximately $5 to 6 million at the Company's 

6. Environmental Matters (continued):

   largest paper mill located in Menasha, WI. The eventual capital
   expense impact on the Company of compliance with the definitive
   Cluster Rules is not presently determinable and will depend on a
   number of factors, including: the scope of the standards imposed
   and time permitted for compliance; the Company's strategic
   decisions related to compliance, including potential changes in
   product mix and markets; and developments in compliance
   technology.  The additional effect, if any, on the Company's
   business of compliance with the definitive Cluster Rules will
   depend on a number of other factors, including: the domestic and
   international competitive effects of compliance; and the effect of
   evolving consumer demands related to environmental issues on the
   Company and its competitors. 

   Chesapeake operates under, and believes that it is in substantial
   compliance with, the terms of various air emission and water and
   effluent discharge permits and other environmental regulations.

7. Recent Developments:

   On May 23, 1997, Chesapeake Corporation ("Chesapeake") completed
   the sale to St. Laurent Paperboard (U.S.) Inc. ("St. Laurent
   (U.S.)"), a wholly-owned subsidiary of St. Laurent Paperboard Inc. 
   (Toronto and Montreal: SPI), of : (i) the sole membership interest
   in Chesapeake Paper Products Company LLC (successor to Chesapeake
   Paper Products Company), a wholly-owned subsidiary of Chesapeake
   which, as of the closing date, owned and operated Chesapeake's
   kraft products mill located in West Point, VA (the "West Point
   Mill"); (ii) all of the capital stock of Chesapeake Box Company
   which, as of the closing date, owned and operated directly or
   through a subsidiary substantially all of the assets of four of
   Chesapeake's corrugated box plants; and (iii) all of the capital
   stock of Chesapeake Fiber Company which, as of the closing date,
   owned and operated directly or through a subsidiary certain assets
   related to the West Point Mill's wood procurement operations.  The
   four box plants involved in the transaction are located in
   Richmond, VA; Roanoke, VA; Baltimore, MD; and North Tonawanda, NY.

   The purchase price of approximately $500.0 million was paid in
   cash at closing, subject to post-closing adjustment as described
   below.  The transaction resulted in an after-tax gain for
   Chesapeake of $49.1 million, or $2.07 a share, recorded in the
   second quarter of 1997.  Chesapeake used about half of the
   proceeds ($252 million) to reduce debt, and plans to use the
   remainder of the net after tax proceeds to repurchase its common
   stock and finance growth opportunities internally and through
   acquisitions in the packaging and recycled tissue businesses.

   Chesapeake retained ownership of its 326,000 acres of timberlands
   following the transaction, and entered into a 15-year agreement
   with St. Laurent Forest Products Corp., a wholly-owned subsidiary 

7. Recent Developments (continued):

   of St. Laurent (U.S.), to supply the West Point Mill with a
   substantial portion of its virgin fiber requirements at market
   prices.  St. Laurent Paper Products Corp. and St. Laurent
   Packaging Corp., each wholly-owned subsidiaries of St. Laurent
   (U.S.), entered into five-year agreements with Chesapeake to
   supply paper and/or corrugated sheets at market prices to certain
   of Chesapeake's remaining packaging operations.

   In total, the operations sold by Chesapeake employed approximately
   1,750 people as of the closing date and had sales in 1996, after
   intercompany eliminations, of approximately $412 million.

   Chesapeake has agreed to indemnify St. Laurent Paperboard, Inc.
   and St. Laurent (U.S.) against losses incurred by them which are
   attributable to any breach of a representation or warranty or
   covenant made by Chesapeake in the Purchase Agreement, provided
   notice is given to Chesapeake within the applicable survival
   period specified therein. The final purchase price is subject to
   adjustment to reflect changes in certain agreed-upon balance sheet
   items from December 31, 1996, through the closing date. 
   Chesapeake expects that such adjustment will be completed during
   the third quarter of 1997.

   During the second quarter, the Company decided to restructure its
   Specialty Packaging and Merchandising Services business.  The
   restructuring includes management reorganization and the closing
   of the Sandusky, OH, point-of-sale display facility and the
   Buffalo, NY, consumer graphic packaging facility.  The intent of
   these moves is to eliminate redundant overhead and processes,
   improve geographic efficiency and reduce fixed costs.  The plant
   closings resulted in a one-time second quarter charge. See
   Management's Discussion and Analysis of Financial Condition and
   Results of Operations.

   On July 14, 1997, the Company announced the election of Thomas H.
   Johnson as president and chief executive officer and a director of
   the Corporation, effective August 1, 1997.  J. Carter Fox, who has
   served as chief executive officer for almost 17 years, will retire
   as president and chief executive officer on the effective date,
   but will continue to serve as a director and as Chairman of the
   Board of Directors.  Mr. Johnson has held several positions in the
   packaging industry, most recently as president and chief executive
   officer of Riverwood International Corporation which is
   headquartered in Atlanta, Georgia.

   On August 7, 1997, the Company announced that C. Elis Olsson has
   resigned from the Company's board of directors.  He will continue
   as vice president of operations at Chesapeake Display & Packaging
   Company's Pelahatchie, Mississippi, plant.



<TABLE>

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

Results of Operations

BUSINESS SEGMENT HIGHLIGHTS
<CAPTION>                                                               
<S>                    <C>       <C>     <C>              <C>    <C>    Second Quarter First Quarter  Year-to-date
                        1997      1996      1997          1997   1996
Net Sales:
 Tissue                    $102.0    $100.6    $ 94.7         $196.7      $194.4
 Specialty packaging         97.1      78.5      93.8          190.9       156.3
 Forest products/
  land development            9.2       5.9       6.5           15.7        10.9
 Ongoing operations         208.3     185.0     195.0          403.3       361.6
 Divested businesses         56.0      91.6      99.5          155.5       192.7     
                           $264.3    $276.6    $294.5         $558.8      $554.3

EBIT:
 Tissue                     $13.5     $20.1    $ 13.2          $26.7      $ 32.6
 Specialty packaging         (0.6)      4.0      (2.0)          (2.6)        7.1
 Forest products/
  land development            2.9        .6       2.7            5.6         2.7
 Corporate                   (3.4)     (3.3)     (4.0)          (7.4)       (8.0)
 Ongoing operations          12.4      21.4       9.9           22.3        34.4
 Divested businesses         (8.3)     (6.5)     (6.0)         (14.3)         .7
 Gain on sale of 
   businesses                86.3     -        -                86.3      -
 Restructuring/
   special charges          (18.9)    -        -               (18.9)     -
                            $71.5     $14.9      $3.9          $75.4       $35.1
</TABLE>
2nd Quarter 1997 vs. 2nd Quarter 1996

     Net income for the three months ended June 30, 1997, was $34.8
million, or $1.47 a share, compared with 1996 second-quarter net
income of $3.9 million, or $.17 a share.  Results for the second
quarter of 1997 included an after-tax gain of $49.1 million, or $2.07
a share, from the sale of the West Point kraft products mill, certain
wood procurement assets  and four corrugated container plants  to St.
Laurent Paperboard (U.S.) Inc. on May 23, 1997.  The second quarter
results also included restructuring and special charges related to
Chesapeake's tissue and specialty packaging businesses of $18.9
million pre-tax ($10.8 million after tax, or $.45 a share) and an
extraordinary loss of $2.3 million after tax, or $.10 a share,
associated with extinguishment of long-term debt.  The restructuring
and special charges included expected future costs related to the
closing of two specialty packaging facilities (see Note 3), salaried
personnel reductions in the packaging and tissue businesses, and fixed
asset write-downs, litigation accruals and other non-recurring 
charges.

     Net income from ongoing operations on a pro forma basis (after
giving effect to the sale of the West Point mill and related assets as
if it had occurred as of the beginning of the second quarter 1997 and
to the application of the net proceeds to reduce long-term debt and
generate interest income), and excluding the special charges and
extraordinary loss recorded in the second quarter 1997, was $5.4
million, or $.23 a share, for the second quarter of 1997, compared to
pro forma net income of $11.1 million, or $.47 a share, in the second
quarter of 1996.  The decline in net income was due to lower pricing
in the tissue and speciality packaging businesses, start-up costs in
the tissue business, and lower operating rates in the speciality
packaging business.

     Net sales for the three months ended June 30, 1997, were $264.3
million, compared with second-quarter 1996 net sales of $276.6
million.  Second quarter 1997 net sales from ongoing operations were
$208.3 million, up 13% from second-quarter 1996 ongoing net sales of
$185.0 million.  This increase in net sales from ongoing operations
was primarily the result of acquisitions in France and Mexico in the
second half of 1996. 
 
     Net sales for the tissue segment of $102.0 million for the second
quarter 1997 were up 1% from second quarter 1996. Shipments of
converted tissue products were 66,445 tons, a 5% increase over second
quarter last year.  For the quarter, 88% of tissue shipments were
converted products, up from 82% for the second quarter last year. 
EBIT for the tissue segment for the second quarter of 1997 of $13.5
million was down 33% compared to the second quarter of last year.  The
second quarter segment operating margin of 13% was down substantially
from last year's peak of 20%, due primarily to a 3% reduction in
average selling prices and start-up costs associated with increased
converting capacity.  Tissue results were also reduced by the planned
maintenance shut-down of two paper machines for two weeks each during
the second quarter of 1997.  The Company's Mexican tissue operations
acquired in December, 1996, were profitable for the 1997 quarter.

     Net sales from ongoing operations for the specialty packaging
segment for the second quarter of 1997 of $97.1 million were up 24%
compared to the second quarter of 1996 due to 8% growth in unit volume
and the acquisition of Chesapeake Europe which was completed in third
quarter 1996.  The increase was partially offset by lower pricing in
most product lines.  Lower pricing, combined with several facilities
running at low operating rates, resulted in a loss of $.6 million for
this segment in the second quarter of 1997 compared to earnings of
$4.0 million in second quarter 1996.  Restructuring is under way in
this segment to better utilize assets and reduce costs.     

     Reflecting the May 23, 1997, divestiture of a substantial portion
of what was its kraft products segment, the Company has created a new
segment--forest products/land development.  This new segment includes
the Company's forest and building products businesses, all of its
timberlands, and its land development business.  Prior year data has
been reclassified to conform to this current segment presentation. 
Net sales of this segment for the second quarter of 1997 of $9.2
million improved 55% over last year's second quarter, while EBIT was
$2.9 million for the second quarter of 1997 compared to $.6 million
last year.  Improvements were due to a 9% increase in lumber
shipments, higher sales of pulpwood and chips to the West Point mill
and favorable lumber pricing.

     Sales and EBIT results for the second quarter of 1997 for
divested businesses compared unfavorably to the second quarter of 1996
due to extremely weak market pricing in the kraft products business
and the shorter time period in 1997 due to the May 23, 1997 sale date.

2nd Quarter Year-to-date 1997 vs. 2nd Quarter Year-to-date 1996

     Net income for the six months ended June 30, 1997, was $31.3
million, or $1.32 a share, compared with 1996 first-half net income of
$11.8 million, or $.50 a share.  Results for 1997 included the after-tax gain of
$49.1 million, or $2.07 a share, from the sale of the West
Point mill and related assets.   Also included in 1997's results were
the restructuring and special charges of $10.8 million after tax, or
$.45 a share, and the extraordinary loss of $2.3 million after tax, or
$.10 a share.

     Net income from ongoing operations on a pro forma basis (after
giving effect to the sale of the West Point mill and related assets as
if it had occurred as of the beginning of 1997 and to the application
of the net proceeds to reduce long-term debt and generate interest
income), and excluding the special charges and extraordinary loss
recorded in 1997, was $9.1 million, or $.38 a share, for the first six
months of 1997, compared to pro-forma net income of $18.1 million, or
$.76 a share, in the first half of 1996.  The decline in net income
was due to lower pricing in the tissue and speciality packaging
businesses, start-up costs in the tissue business, and lower operating
rates in the speciality packaging business.

     Net sales for the six months ended June 30, 1997, were $558.8
million, compared with  net sales of $554.3 million for the first half
of 1996.  First-half 1997 net sales from ongoing operations were
$403.3 million, up 12% from first-half 1996 ongoing net sales of
$361.6 million.  This increase in net sales from ongoing operations
was primarily the result of acquisitions in France and Mexico in the
second half of 1996.  

     Net sales for the tissue segment of $196.7 million for the first
half of 1997 were up 1% from first-half 1996.  Shipments of converted
tissue products were 128,976 tons, a 9% increase over last year.  
EBIT for the tissue segment for the first six months of 1997 of $26.7
million was down 18% compared to the first half of last year.  Average
selling prices were down 4% from last year.  Tissue results were also
reduced by the planned maintenance shut-down of two paper machines for
two weeks each during the second quarter of 1997.  Also, volume
suffered as several converting machines were dismantled and
transferred from Wisconsin to newer facilities in Arizona and New
York, in connection with strategic initiatives intended to achieve
savings and marketing advantages. The Company's Mexican tissue
operations have been profitable for the first half of the year.

     Net sales from ongoing operations for the specialty packaging
segment for the first half of 1997 were up 22% compared to the first
half of 1996 due to 7% growth in unit volume and the acquisition of
Chesapeake Europe in third quarter 1996.  The increase was partially
offset by lower pricing in most product lines.  Lower pricing,
combined with several facilities running at low operating rates,
resulted in a loss of $2.6 million for this segment in the first six
months of 1997 compared to earnings of $7.1 million the first half of
in 1996. Restructuring is under way in this segment to better utilize
assets and reduce costs.

     Net sales of the forest products/land development segment for the
first two quarters of 1997 of $15.7 million improved 44% over 1996,
while EBIT was $5.6 million compared to $2.7 million last year. 
Improvements were due to a 15% increase in lumber shipments, higher
sales of pulpwood and chips to the West Point mill, favorable lumber
pricing and improvements in sawmill efficiency.

     Sales and EBIT results for the first half of 1997 for divested
businesses compared unfavorably to the second quarter of 1996 due to
extremely weak market pricing in the kraft products business and the
shorter time period in 1997 due to the May 23, 1997 sale date.


2nd Quarter 1997 vs 1st Quarter 1997

     Net income for the second quarter 1997 was $34.8 million, or
$1.47 a share, compared with a 1997 first-quarter net loss of $3.5
million, or $.15 a share.  Results for the second quarter of 1997
included an after-tax gain of $49.1 million, or $2.07 a share, from
the sale of the West Point mill and related assets.  The second
quarter results also included the restructuring and special charges of
$10.8 million after tax, or $.45 a share, and the extraordinary loss
of $2.3 million after tax, or $.10 a share.

     Net income from ongoing operations on a pro forma basis (after
giving effect to the sale of the West Point mill and related assets as
if it had occurred as of the beginning of 1997 and to the application
of the net proceeds to reduce long-term debt and generate interest
income), and excluding the special charges and extraordinary loss
recorded in the second quarter 1997, was $5.4 million, or $.23 a
share, for the second quarter of 1997, compared to pro forma net
income of $3.7 million, or $.15 a share, in the first quarter of 1997.

     Net sales for the three months ended June 30, 1997, were $264.3
million, compared with first-quarter net sales of $294.5 million. 
Second quarter 1997 net sales from ongoing operations were $208.3
million, up 7% from first-quarter 1997 ongoing net sales of $195.0
million.  The first quarter is normally the seasonal low-point for
many of the Company's businesses.

     Net sales for the tissue segment of $102.0 million for the second
quarter 1997 were up $7.3 million, or 8%,  from first quarter 1997. 
Shipments of converted tissue products were up 6%.   EBIT for the
tissue segment for the second quarter of 1997 was up 2% compared to
last quarter.   Average selling prices were flat compared  to the
prior quarter.  Tissue results for the second quarter 1997 were
impacted by the planned maintenance shut-down of two paper machines
for two weeks each and start-up costs associated with increased
converting capacity.  The Company's Mexican tissue operations were
again profitable, but earnings were lower than first quarter 1997 due
to nonrecurring facility consolidation and moving costs incurred
during the second quarter.

     Net sales from ongoing operations for the specialty packaging
segment for the second quarter of 1997 were up 4% compared to the
first quarter of 1997, as volume was up 8%.   The increase was
partially offset by lower pricing in most product lines. This segment
lost $.6 million in the second quarter compared to a loss of $2.0
million in the first quarter.  Low operating rates continued to be a
problem for certain facilities. Restructuring is under way in this
segment to better utilize assets and reduce costs.   

     Net sales of the forest products/land development segment for the
second quarter of 1997 improved $2.7 million, or 42%, over the first
quarter, while EBIT was $2.9 million compared to $2.7 million last
quarter.  Improvements were due to higher sales of pulpwood and chips
to the West Point mill and  favorable lumber pricing.

     Sales and EBIT results for the second quarter of 1997 for
divested businesses compared unfavorably to the first quarter of 1997
due to extremely weak market pricing in the kraft products business
and the shorter time period in the second quarter due to the May 23,
1997 sale date.

Capital Expenditures

     Capital expenditures and acquisitions for the first six months of
1997 totaled $32.4 million and related primarily to strategic
initiatives in the packaging and tissue businesses.  Capital
expenditures and acquisitions in the first half of 1996 totaled $106.5
million and also related primarily to strategic initiatives  in the
packaging and tissue businesses, and included the acquisitions of the
Display Division of Dyment Limited.   Total capital expenditures and
acquisitions for 1997 are expected to be approximate $80 million.  
These initiatives include: new tissue converting equipment at the
Bellemont, AZ, and Greenwich, NY, facilities; and expansion of the
Erlanger, KY, display and packaging plant.  These projects are
consistent with Chesapeake's strategy of expanding the packaging and
tissue businesses, reducing costs and focusing capital spending on
projects that are expected to generate a high return on investment. 
No other 1997 capital project is expected to account for more than 5%
of the total planned spending.  Capital expenditures and acquisitions
for 1997 are expected to be financed with internally generated cash
and proceeds remaining from the sale of the West Point mill and
related assets.

     
Liquidity and Capital Structure

     Working capital increased $70.4 million during the second quarter
of 1997.   The increase was primarily due to the increase in cash and
cash equivalents resulting from the sale of businesses, offset in part
by the reduced accounts receivable, inventories and accounts payable
caused by the divestiture.  Also offsetting the increase was the
higher income taxes payable associated with the gain on the sale.  The
average accounts receivable collection period for the first half of
1997 has improved one day over the first half of  1996.  The inventory
turnover rate for the first half of 1997 was approximately the same as
the first half of last year.  The ratio of current assets to current
liabilities was 2.1 at the end of the second quarter of 1997 compared
to 2.2 at the end of the first quarter of 1997 and 2.0 at year end
1996.

     EBITDA, a measure of internal cash flow combining earnings before
interest and income taxes plus non-cash charges for depreciation, cost
of timber harvested and amortization, was $24.6 million for the second
quarter of 1997, not including the one-time gain on the sale of
businesses, restructuring/special charges, or the extraordinary item. 
This was 35% lower than EBITDA of $37.7 million for the second quarter
of 1996.  Year-to-date EBITDA was $56.2 million, or 30% less than
EBITDA of $80.6 million in the first half of 1996.  Net cash provided
by operating activities for the second quarter was $44.2 million, up
from $36.4 million for the second quarter of 1996. Year-to-date net
cash provided by operating activities was $46.2 million compared to
$67.8 million for the first half of 1996. 

     At the end of the second quarter, long-term debt totaled $265.5
million, or $233.9 million lower than long-term debt at year-end 1996. 
The decrease in borrowings resulted from the use of about half of the
proceeds ($250 million) from the second quarter sale of businesses to
reduce debt.  During the quarter, Chesapeake paid down its bank credit
lines, repaid a term loan that was due in the year 2000, and
repurchased in open market transactions $26 million of its 9.875%
notes due in 2003.  An after-tax extraordinary loss of $2.3 million
was recorded in the second quarter to recognize the premium paid to
extinguish this debt.  The ratio of long-term debt to total capital
was 32% at the end of the second quarter, compared to 47% at the end
of the first quarter of 1997 and 44% at the end of the second quarter
of 1996.  The ratio of long-term debt to stockholders' equity was 54%
at the end of the second quarter of 1997, compared to 112% at the end
of the first quarter of 1997 and 99% at the end of the second quarter
of 1996.  Out of a total of $68.5 million committed and $120 million
uncommitted domestic and foreign credit lines available at the end of
the second quarter of 1997, $9 million of foreign lines were utilized.

     Foreign currency transactions and financial statements of foreign
subsidiaries are translated into U.S. dollars at prevailing or current
rates respectively, except for revenue, costs and expenses, which are
translated at average current rates during each reporting period. 
Gains and losses resulting from foreign currency transactions, other
than transactions used to hedge the value of investments in certain
foreign subsidiaries, are included in income currently.  Gains and
losses resulting from certain hedging transactions and from
translation of financial statements are excluded from the statement of
income and are credited or charged directly to a separate component of
shareholders' equity.  Transaction gains and losses of subsidiaries
operating in hyper-inflationary economies are included in net income
currently.

     "Management's Discussion and Analysis of Financial Condition and
Results of Operations" may include "forward-looking statements" that
are made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995.  Changes in the following
important factors, among others, could cause Chesapeake's actual
results to differ materially from those expressed in the forward-looking
statements: competitive products and pricing; production
costs, particularly for raw materials such as waste paper and
corrugated box and display materials; fluctuations in demand;
governmental policies and regulations affecting the environment;
interest rates; currency translation movements; and the availability
of suitable acquisition candidates. 





      




                               PART II




Item 1.      Legal Proceedings.

             Reference is made to Note 4 of the Notes to Consolidated
             Financial Statements included herein.

Item 5. Other Information.

             During the second quarter of 1997, the Company decided to
             restructure its Speciality Packaging and Merchandising
             Services business.  See Note 7 to the condensed consolidated
             financial statements.

             On July 14, 1997, the Company announced the election of
             Thomas H. Johnson as president and chief executive officer
             and a director of the Corporation, effective August 1, 1997. 
             See Note 7 to the condensed consolidated financial
             statements.

             On August 7, 1997, the Company announced that C. Elis Olsson
             has resigned from the Company's board of directors.  He will
             continue as vice president of operations at Chesapeake
             Display & Packaging Company's Pelahatchie, Mississippi,
             plant.

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

             (a)  Exhibit 11.1 - Computation of Net Income Per Share
                                 of Common Stock

                 Exhibit 27.1 - Financial Data Schedule

            (b)  Reports on Form 8-K

                 Current Report on Form 8-K dated April 2, 1997,
                 reporting, under Item 5, that the Company had
                 reached preliminary agreement in principal with St.
                 Laurent Paperboard Inc. regarding St. Laurent's
                 purchase of Chesapeake's West Point, VA, kraft
                 products mill and related assets.

                      Current Report on Form 8-K dated May 23, 1997,
                      reporting, under Item 2, the disposition of the
                      West Point, VA, kraft products mill and related
                      assets.





                                SIGNATURES

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


                                          CHESAPEAKE CORPORATION
                                               (Registrant)



Date: August 8, 1997               BY:   /s/William T. Tolley            
                                             William T. Tolley
                                          Chief Financial Officer        
                                                                         







                            EXHIBIT INDEX



                                                                 Page

Exhibit 11.1
         Computation of Net Income per Share of
         Common Stock                                             24  
     


                                                              EXHIBIT 11.1

<TABLE>
                     CHESAPEAKE CORPORATION AND SUBSIDIARIES
               COMPUTATION OF NET INCOME PER SHARE OF COMMON STOCK
                     FOR THE SECOND QUARTER AND YEAR TO DATE 
                           ENDED JUNE 30, 1997 AND 1996

             (Share amounts in thousands, dollar amounts in millions,
                          except for per share amounts)
<CAPTION>
                                           Second Quarter     Year to Date
                                          1997       1996     1997     1996
<S>                                      <C>        <C>       <C>     <C>
Primary:
  Weighted average number of common
    shares outstanding                   23,547    23,625    23,490   23,674  
  Net additions to common shares
    assuming exercise of dilutive
    options, determined by treasury
    stock method                            240       113       212      115
  Common shares and equivalents          23,787    23,738    23,702   23,789

  Income before extraordinary item         $ 37.1    $  3.9    $ 33.6   $ 11.8
  Extraordinary item                         (2.3)      -        (2.3)     -

  Net income                               $ 34.8    $  3.9    $ 31.3   $ 11.8
  
  Per share amount:
     Earnings before extraordinary item    $ 1.57     $ .17    $ 1.42    $ .50
     Extraordinary item                      (.10)      -        (.10)    -
     Earnings                              $ 1.47      $ .17   $ 1.32    $ .50

Fully diluted:
  Common shares and equivalents          23,787    23,738    23,702   23,789
  Net additional common shares
    issuable upon exercise of
    dilutive options, determined
    by treasury stock method using
    period end market price, if
    higher than average price                14         -         7       19
   
  Common shares, equivalents and
    other potentially dilutive
    securities                           23,801    23,738    23,709   23,808

  Income before extraordinary item         $ 37.1    $  3.9    $ 33.6   $ 11.8
  Extraordinary item                         (2.3)      -        (2.3)     -

  Net income for fully diluted
    computation                            $ 34.8    $  3.9    $ 31.3   $ 11.8

  Per share amount: (a)
   Earnings before extraordinary item      $ 1.57   $ .17      $ 1.42  $ .50
   Extraordinary item                        (.10)      -        (.10)    -
   Earnings                                $ 1.47      $ .17   $ 1.32    $ .50

</TABLE>
NOTE:   (a) Dilution is less than 3%