SECURITIES AND EXCHANGE COMMISSION

                          Washington, DC 20549

                              FORM 10-Q

             QUARTERLY REPORT UNDER SECTIONS 13 OR 15(d)

               OF THE SECURITIES EXCHANGE ACT OF 1934

     For the Quarter Ended June 30, 1999  Commission File Number 0-13071

                       INTERPHASE CORPORATION
       (Exact name of registrant as specified in its charter)

             Texas                                  75-1549797
    (State of incorporation)            (IRS Employer Identification No.)


                  13800 Senlac, Dallas, Texas 75234
              (Address of principal executive offices)

                              (214)-654-5000
        (Registrant's telephone number, including area code)

_______________________________________________________________________
Indicate by check mark  whether the registrant (1)  has filed all  reports
required by Section  13 or 15(d)  of the Securities  Exchange Act of  1934
during the preceding  12 months  (or for a  much shorter  period that  the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.      Yes    X       No
_______________________________________________________________________
Indicate the  number  of shares  outstanding  of each  of  the  issuer's
classes of common stock, as of the latest practicable date.

            Class                         Outstanding at August 2, 1999
  Common Stock, No par value                        5,678,185

<PAGE>

                          INTERPHASE CORPORATION

                                  INDEX


  Part I -Financial Information

       Item 1.   Consolidated Interim Financial Statements

                 Consolidated Balance Sheets as of June 30, 1999
                  and December 31, 1998                                  3

                 Consolidated Statements of Operations for the three
                  months and six months ended June 30, 1999 and 1998     4

                 Consolidated Statements of Cash Flows for the six
                  months ended June 30, 1999 and 1998                    5

                 Notes to Consolidated Interim Financial Statements      6

       Item 2.   Management's Discussion and Analysis of
                  Financial Condition and Results of Operations         10

  Part II- Other Information

       Item 4.   Submission of Matters to a Vote of Security Holders    14

       Item 6.   Reports on Form 8-K and Exhibits                       14

                 Signature                                              15

<PAGE>
<TABLE>
  INTERPHASE CORPORATION
  CONSOLIDATED BALANCE SHEETS
  (in thousands)
<CAPTION>
                                              (unaudited)
                                                June 30,     Dec 31,
  ASSETS                                          1999         1998
                                               ---------------------
  <S>                                          <C>         <C>
  Cash and cash equivalents                    $   2,848   $   4,531
  Marketable securities                            3,449       3,430
  Trade accounts receivable, less allowances
   for uncollectible accounts of $208 and
   $164, respectively                             13,319      13,716
  Inventories, net                                13,628      13,488
  Prepaid expenses and other current assets        1,443         856
  Deferred income taxes, net                         516         516
                                               ---------------------
       Total current assets                       35,203      36,537
                                               ---------------------
  Machinery and equipment                         10,463      10,135
  Leasehold improvements                           3,049       2,909
  Furniture and fixtures                             549         515
                                               ---------------------
                                                  14,061      13,559
                                               ---------------------
  Less-accumulated depreciation and
   amortization                                  (10,852)    (10,339)
                                               ---------------------
       Total property and equipment, net           3,209       3,220

  Capitalized software, net                          819         773
  Deferred income taxes, net                       1,376       1,376
  Acquired developed technology, net               2,824       3,365
  Goodwill, net                                    2,950       3,070
  Other assets                                     2,133       1,947
                                               ---------------------
       Total assets                            $  48,514   $  50,288
                                               =====================
<PAGE>

  LIABILITIES AND SHAREHOLDERS'EQUITY
  Accounts payable                             $   2,603   $   2,883
  Accrued liabilities                              1,591       1,639
  Accrued compensation                             1,595       2,041
  Income taxes payable                               337       1,408
  Current portion of debt                          2,218       2,252
                                               ---------------------
       Total current liabilities                   8,344      10,223

  Other liabilities                                  658         873
  Long term debt                                   6,265       7,367
                                               ---------------------
       Total liabilities                          15,267      18,463
  Commitments and contingencies
  Common stock redeemable                          3,304       3,813
  SHAREHOLDERS' EQUITY
  Common stock, no par value                      32,366      31,221
  Retained deficit                                (2,273)     (3,217)
  Cumulative other comprehensive income             (150)          8
                                               ---------------------
       Total shareholders' equity                 29,943      28,012
                                               ---------------------
  Total liabilities and shareholders' equity   $  48,514   $  50,288
                                               =====================

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

  INTERPHASE CORPORATION
  CONSOLIDATED STATEMENTS OF OPERATIONS
  (in thousands except
  per share amounts)
  (unaudited)


   Three Months Ended                                Six Months Ended
  30-Jun-99  30-Jun-98                              30-Jun-99  30-Jun-98
   ------------------                              --------------------
   <C>       <C>         <S>                       <C>        <C>
   $ 17,818  $ 16,087    Revenues                  $ 35,164   $  33,676
      9,521     8,007    Cost of sales               19,052      17,453
   ------------------                              --------------------
      8,297     8,080    Gross profit                16,112      16,223

      3,070     2,640    Research and development     6,031       5,506
      3,109     2,617    Sales and marketing          5,774       5,003
      1,405     1,500    General and administrative   2,605       2,829
   ------------------                              --------------------
      7,584     6,757     Total operating expenses   14,410      13,338
   ------------------                              --------------------
        713     1,323    Operating income             1,702       2,885
   ------------------                              --------------------

         63        60    Interest income                195         143
       (127)     (286)   Interest expense              (369)       (526)
         74      (220)   Other, net                    (150)       (445)
   ------------------                              --------------------
        723       877    Income before income taxes   1,378       2,057

        203       367    Provision for income taxes     434         839
   ------------------                              --------------------
   $    520  $    510     Net income               $    944   $   1,218
   ==================                              ====================

                         Net income per share
   $   0.10  $   0.09        Basic EPS             $   0.17   $    0.22
   ------------------                              --------------------
   $   0.09  $   0.09        Diluted EPS           $   0.17   $    0.21
   ------------------                              --------------------

                         Weighted average common
      5,422     5,517    shares                       5,418       5,517
   ------------------                              --------------------
                         Weighted average common
      5,801     5,682    and dilutive shares          5,698       5,674
   --------------------------------------------------------------------

  The accompanying notes are an integral part of these consolidated
                          financial statements.
</TABLE>
<PAGE>
<TABLE>
  INTERPHASE CORPORATION
  CONSOLIDATED STATEMENTS OF CASH FLOWS
  (in thousands)
  (unaudited)                                     Six Months ended
                                               30-Jun-99      30-Jun-98
                                               ------------------------
  <S>                                          <C>              <C>
  Cash flow from operating activities:
    Net income                                 $   944          $ 1,218
    Adjustment to reconcile net income to net
     cash provided by operating activities:
    Depreciation and amortization                1,978            1,909
    Change in assets and liabilities:
         Trade accounts receivable                 397                2
         Inventories                              (140)           1,430
         Prepaid expenses and other
          current assets                          (587)             105
         Accounts payable and accrued
          liabilities                             (328)          (1,707)
         Accrued compensation                     (446)             (15)
         Income taxes payable                   (1,071)             405
                                               ------------------------
     Net adjustments                              (197)           2,129
                                               ------------------------
    Net cash provided by operating activities      747            3,347
  Cash flows from investing activities:
    Additions to property, equipment,
     leasehold improvements and
     capitalized software                       (1,352)            (873)
    Decrease in other assets                      (186)              10
     (Increase) decrease in marketable
     securities                                    (19)              91
                                               ------------------------
    Net cash (used) by investing activities     (1,557)            (772)
  Cash flows from financing activities:
     Payments on debt                           (1,136)          (1,189)
     Other long term liabilities                  (215)             (66)
     Change in comprehensive income               (158)              35
     Purchase of redeemable common stock          (509)               -
     Proceeds from the exercise of
      stock options                              1,145                8
                                               ------------------------
   Net cash (used) by financing activities        (873)          (1,212)
                                               ------------------------
  Net increase (decrease) in cash and
   cash equivalents                             (1,683)           1,363
  Cash and cash equivalents at beginning
   of period                                     4,531            2,247
                                               ------------------------
  Cash and cash equivalents at end of period   $ 2,848          $ 3,610
                                               ========================
  Supplemental Disclosure of Cash
   Flow Information:
  Income taxes paid                              1,509              432
  Interest paid                                    364              494

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

            NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS


  1.   BASIS OF PRESENTATION

  The accompanying consolidated interim financial statements include the
  accounts of Interphase Corporation  and its wholly owned  subsidiaries
  (the "Company").  Significant  intercompany accounts and  transactions
  have been eliminated.

  While the  accompanying interim  financial statements  are  unaudited,
  they have  been prepared  by the  Company pursuant  to the  rules  and
  regulations of the Securities and Exchange Commission. In the  opinion
  of the Company, all material adjustments and disclosures necessary  to
  fairly present the results  of such periods have  been made.   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 the rules  and
  regulations  of  the  Securities  and  Exchange  Commission.     These
  financial  statements  should   be  read  in   conjunction  with   the
  consolidated financial statements and notes thereto for the year ended
  December 31, 1998.


  2.   NET INCOME PER COMMON AND COMMON DILUTIVE SHARE

  The following table shows the  calculations of the Company's  weighted
  average  common  and  dilutive   equivalent  shares  outstanding   (in
  thousands):
<TABLE>

                                Three months ended:   Six  months ended:
                                Jun 30,     Jun 30,    June 30,  June 30,
                                 1999        1998        1999      1998
                                -----       -----       -----     -----
  <S>                           <C>         <C>         <C>       <C>
  Weighted average
  shares outstanding            5,422       5,517       5,418     5,517

  Dilutive impact of
  stock options                   379         165         280       157
                                -----       -----       -----     -----
  Total weighted
  average common and
  common equivalent
  shares outstanding            5,801       5,682       5,698     5,674
                                ---------------------------------------
  Anti-Dilutive
  Weighted Shares
  Excluded from shares
  outstanding                     202         960         246       956

</TABLE>
<PAGE>
  3.   CREDIT FACILITY

  The Company maintains a  credit facility with  BankOne Texas NA  which
  consists  of  an  $8,500,000  acquisition  term  loan,  a   $2,500,000
  equipment  financing  facility  and  a  $5,000,000  revolving   credit
  facility.   The facility is a two-year facility with an annual renewal
  provision, and  bears  interest at  the  bank's base  rate  (currently
  8.5%).  The term  loan is payable in  equal quarterly installments  of
  $548,000 plus accrued interest   with final  payment due November  30,
  2001.  The Company has the  ability to satisfy the quarterly  payments
  on the  term  notes  through borrowings  under  the  revolving  credit
  component of the credit facility.   The revolving portion of the  loan
  has been renewed and  is due June  30, 2001.   The credit facility  is
  collateralized  by  marketable  securities,  assignment  of   accounts
  receivable and  equipment.    The  credit  facility  includes  certain
  restrictive financial covenants including, among others, tangible  net
  worth, total  liabilities to  tangible net  worth, interest  coverage,
  quick ratio, debt service coverage, and is subject to a borrowing base
  calculation.  At  June  30,  1999,  the  Company  had  borrowings   of
  $8,452,000 and  remaining  availability  under  the  revolving  credit
  facility was $1,500,000.


  4.   COMPREHENSIVE INCOME

<TABLE>
  The following table shows the Company's comprehensive income (in thousands):

                                Three months ended:   Six months ended:
                               June 30,    June 30,   June 30,  June 30,
                                 1999        1998       1999      1998
                                 ----        ----       ----     -----
  <S>                             <C>         <C>        <C>     <C>
  Net income                      520         510        944     1,218
  Other comprehensive income
   Unrealized holding gains
   (losses) arising during
   period, net of tax             (77)          0        (77)        0
  Foreign currency
   translation adjustment         (34)         79        (81)       35
                                 ----        ----       ----     -----
  Comprehensive income            409         589        786     1,253
                                 ====        ====       ====     =====
</TABLE>
<PAGE>
  5.   STOCK REPURCHASE

  Effective October  1998,  the  Company  approved  a  stock  repurchase
  agreement with Motorola, Inc. to purchase  all of the shares owned  by
  Motorola for  $4,125,000,  ratably from  October  1998 to  July  2002.
  Under the terms  of the agreement,  Motorola retains the  right as  an
  equity owner and has assigned its  voting rights to the Company.   The
  Company plans to cancel the stock upon each repurchase.  Prior to  the
  repurchase  agreement,  Motorola  owned   approximately  12%  of   the
  Company's outstanding common stock.  The future scheduled payments are
  classified as redeemable common stock in the accompanying consolidated
  Balance Sheet.    As  of  June 30,  1999,  131,334  shares  have  been
  repurchased for $820,837 and retired.


  6.   DISPOSISTION OF ASSETS

  Effective June 30, 1999  the Company sold an  80% interest in part  of
  its VOIP  business, Quescom,  for $1,172,000  to the  former owner  of
  Interphases's Paris  Operation.    The  sales  proceeds  consisted  of
  $300,000 due at closing with a  $872,000 technology license fee.   The
  license fee is payable based on capital availability of the  purchaser
  or based on 5%  of the purchaser's revenues,  beginning July 1,  2000.
  The sales agreement also contains purchasing and manufacturing  rights
  for the Purchaser of certain Interphase technology, as well as certain
  rights of  first  refusal for  Interphase  with respect  to  executive
  salaries, disposition of assets, and merger and acquisitions.  Due  to
  the uncertainty of payment on the  remaining license fee, the  Company
  will recognize the  income as  payment is received.   As  of June  30,
  1999, $300,000 had been  received and is included  in other income  in
  the Statement  of  Operations.   The  Company  will  account  for  its
  remaining 20% investment in the new company using the equity method of
  accounting.  This investment is included in other assets.

<PAGE>

  7.   SEGMENT DATA

  The Company manages its business segments  on an industry basis.   The
  Company's  reportable  segments  are  composed  of  high   performance
  networking/storage adapters and  voice over  Internet Protocol  (VOIP)
  products and services.  The Company  evaluates the performance of  its
  segments based  on revenue  and operating  profits. Segment  operating
  income (loss) excludes general and administrative expenses.   (Amounts
  in thousands $):

<TABLE>
  Segment Data:  Three months ended June 30:

                      Three months ended           Three months ended
                         June 30, 1999               June 30, 1998
                  Networking   VOIP    Total   Networking   VOIP  Total
                  --------------------------   -------------------------
  <S>               <C>        <C>    <C>        <C>        <C>   <C>
  Revenues          17,657      161   17,818     16,087       -   16,087

  Operating income   2,809     (691)   2,118      2,823       -    2,823

  Fixed assets       3,367      661    4,028      3,295       -    3,295


  Reconciliation of segment operating income to consolidated operating
  income:

                                          Three months ended
                                     June 30, 1999  June 30, 1998
                                     ----------------------------
  <S>                                     <C>            <C>
  Networking                               2,809          2,823
  VOIP                                      (691)             -
  General and Administrative              (1,405)        (1,500)
  Consolidated Operating Income              713          1,323



  Segment Data:  Six-month period ended June 30:

                    Six-month period ended      Six-month period ended
                         June 30, 1999                June 30, 1998
                   Networking  VOIP   Total    Networking   VOIP    Total
                   -------------------------   --------------------------
  <S>                <C>     <C>      <C>         <C>        <C>   <C>
  Revenues           34,826     338   35,164      33,676      -    33,676

  Operating income    5,826  (1,519)   4,307       5,714      -     5,714

</TABLE>
<PAGE>

  Reconciliation of segment operating income to consolidated operating
  income:
<TABLE>
                                        Six-month period ended
                                     June 30, 1999  June 30, 1998
                                     ----------------------------
  <S>                                    <C>            <C>
  Networking                              5,826          5,714
  VOIP                                   (1,519)             -
  General and Administrative             (2,605)        (2,829)
  Consolidated Operating Income           1,702          2,885



  Fixed Assets and Capitalized Software by Segment:

                          June 30, 1999    Dec 31, 1998
                          -------------    ------------
  <S>                         <C>               <C>
  Networking                  3,367             3,241
  VOIP                          661               752
  Total                        4028             3,993


  Segment Data: Geographic:

  Revenue related to North American and other foreign countries for  the
  three month and six-month period ended  June 30, 1999 and 1998 are  as
  follows. (Amounts in thousands $)

                         Three months ended:          Six months ended:
  Revenue           June 30, 1999  June 30, 1998 June 30, 1999 June 30, 1998
                    -------------  ------------- ------------- -------------
  <S>                    <C>            <C>           <C>           <C>
  North America          14,490         13,248        27,559        25,580
  Europe                  3,006          2,596         7,125         7,046
  Pac Rim                   322            243           480         1,050
                         ------         ------        ------        ------
  Total                  17,818         16,087        35,164        33,676
                         ======         ======        ======        ======

  Long  lived  assets  related  to  North  American  and  other  foreign
  countries for the period ended June 30, 1999 and December 31, 1998 are
  as follows. (Amounts in thousands $)

  Long lived assets      June 30, 1999   Dec 31, 1998
                         -------------   ------------
  <S>                         <C>           <C>
  North America               3,815         3,701
  Europe                        213           292
  Pac Rim                         0             0
                              -----         -----
  Total                       4,028         3,993
                              =====         =====
</TABLE>
<PAGE>

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

  RESULTS OF OPERATIONS

  Revenues for the three  months ended June 30,  1999  ("second  quarter
  1999") were  $17,818,000.    Revenues for  the  same  period  in  1998
  ("comparative period") were $16,087,000.    The 11% increase in  total
  revenue from the second  quarter of 1999 to  the comparable period  is
  attributable to increases in Fibre  Channel and ATM product  revenues,
  partially offset by decreases in  FDDI, SCSI, Ethernet, Fast  Ethernet
  and WAN   product revenues.   During the  second quarter,  one of  the
  Company's distributors asked to return certain products totaling  $1.5
  million.   This  request  was the  result  of  an  unexpected  product
  specification change and production delays of one of the distributor's
  customers.  The Company  evaluated this request  based upon the  long-
  term business prospects with the distributor and its customer, as well
  as the Company's ability to use the returned product to fulfill  other
  customers' current and  future orders.   Based on  this analysis,  the
  Company agreed to accept the return.

  LAN product  revenues,  consisting of  FDDI,  Ethernet, ATM  and  Fast
  Ethernet, represented 49%  of total  revenues for  the second  quarter
  1999, as compared  to 61% for  the comparative period.   FDDI  product
  revenues declined  5%, Ethernet  product  revenues declined  63%,  ATM
  product revenues  increased 107%  and Fast  Ethernet product  revenues
  declined 30% as compared to the comparative period.   FDDI,  Ethernet,
  ATM and Fast Ethernet  product revenues represented  16%, 4%, 12%  and
  20% of total revenues, respectively for the second quarter 1999.

  Mass storage product  revenues, consisting of  SCSI and Fibre  Channel
  adapter cards,  represented  43%  of total  revenues  for  the  second
  quarter 1999, as  compared to 22%  for the comparative  period.   SCSI
  product revenues  declined 22%  while Fibre  Channel product  revenues
  increased 163% over the comparative period.

  WAN product revenues comprised 5% of  revenues for the second  quarter
  1999, as compared  to 15%  for the  comparative period.   WAN  product
  revenues decreased 64% as compared to the comparative period.

  Geographically, North America revenues  comprised 81% of  consolidated
  revenues in the second quarter 1999 compared to 82% in the comparative
  period.  European revenues comprised  17% of consolidated revenues  in
  the second quarter 1999 and 16% in the comparative period. Pacific Rim
  revenues comprised 2% of consolidated  revenues in the second  quarter
  1999 and 2% in the comparative period.

  Revenues  for  the  six  month  period  ended  June   30,  1999   were
  $35,164,000 as compared to $33,676,000 for the six month period  ended
  June 30, 1998.  Revenues from LAN, Mass Storage and WAN products  were
  48%, 37% and  12% of total  revenues respectively, for  the six  month
  period ended June 30 1999.

  The  Company's  current  marketing  strategy  is  to  increase  market
  penetration through  sales  to major  OEM  customers.   One  of  these
  customers accounted for approximately 52% of the Company's revenue for
  the second quarter of 1999 and 39% in the comparable period.
<PAGE>
  The gross margin percentage  for the second quarter  1999 was 47%  and
  50% for the comparable  period.  The gross  margin percentage for  the
  six-month period  ended  June  30,  1999 and  1998  was  46%  and  48%
  respectively.  The decrease in gross margin  is due to a shift in  the
  product sales mix.

  Operating expenses  for the  second quarter  1999 were  $7,584,000  as
  compared to $6,757,000  for the comparable  period.   The increase  in
  operating expenses is due  to expenses relating  to the Company's  new
  subsidiaries Zirca.com and  Quescom.  Operating  expenses for the  six
  month period  ended June  30, 1999  were  $14,410,000 as  compared  to
  $13,338,000 for the six-month period ended June 30, 1998.

  Other expense for the second quarter included a gain of $300,000  that
  represents an initial license payment due to the restructuring of  the
  Company's subsidiary, Quescom.  The Company transferred the assets  of
  its Quescom subsidiary to a new company, T2PCom in exchange for a  20-
  percent equity  interest  in the  company  and a  license  payment  of
  $1,172,000 for previously developed technology.


  LIQUIDITY AND CAPITAL RESOURCES

  The  Company's  cash,  cash  equivalents  and  marketable   securities
  aggregated $6,297,000 at June 30, 1999, and $7,961,000 at December 31,
  1998.  The Company's decreased cash  position is primarily due to  the
  purchase of fixed assets, payment on  debt, tax payments and  purchase
  of common stock.  In the  next twelve months, scheduled debt  payments
  on the Company's credit facility are approximately $2,192,000.

  Effective October  1998,  the  Company  approved  a  stock  repurchase
  agreement with Motorola, Inc. to purchase  all of the shares owned  by
  Motorola for  $4,125,000,  ratably from  October  1998 to  July  2002.
  Under the terms  of the agreement,  Motorola retains the  right as  an
  equity owner and has  assigned it voting rights  to the Company.   The
  Company plans to cancel the stock upon each repurchase.  Prior to  the
  repurchase  agreement,  Motorola  owned   approximately  12%  of   the
  Company's outstanding common stock.  The future scheduled payments are
  classified as redeemable common stock in the accompanying consolidated
  Balance Sheet.    As  of  June 30,  1999,  131,334  shares  have  been
  repurchased for $820,837 and retired.

  The Company  expects  that  its  cash,  cash  equivalents,  marketable
  securities and proceeds from its credit  facility will be adequate  to
  meet foreseeable cash needs for the next 12 months.
<PAGE>
  Year 2000

  The Company has recognized the need to ensure that its operations  and
  relationships with  vendors  and  other  third  parties  will  not  be
  adversely impacted  by software  processing  errors arising  from  the
  calculations using the Year 2000 ("Y2K") and beyond.

  The Company  has  created a  company-wide  Y2K team  to  identify  and
  resolve Y2K issues associated with the Company's internal  information
  systems, internal non-information  systems, the products  sold by  the
  Company, and its major suppliers of products and services. The Company
  established a Y2K  program coordinator  to ensure  these programs  are
  implemented across  the Company.  The  coordinator provides  a  single
  point of reference, both internal, and external, for the Company.  The
  products that  the Company  sells are  Y2K compliant.   The  Company's
  internal reporting  system  is being  replaced  with a  Y2K  compliant
  Enterprise Reporting Planning  (ERP) system  that is  scheduled to  go
  into operation the third quarter of 1999.  In addition, the Company is
  communicating with  its suppliers,  customers, vendors  and  financial
  service organizations  regarding  their  Year 2000  compliance.    The
  Company anticipates that  its full Year  2000 review, new  information
  system implementation, and other necessary remediation actions will be
  substantially complete  by  the end  of  the third  quarter  of  1999.
  Direct expenditures in 1999  are expected to  be between $850,000  and
  $900,000. The Company will fund these expenditures through its  normal
  operating budget,  and as  required by  generally accepted  accounting
  principles, these costs are being expensed as incurred, excluding  the
  capitalization  of  application  software.    The  capitalization  for
  software will be approximately $300,000.  The Company does not believe
  that the  costs associated  with such  actions  will have  a  material
  adverse effect on  the Company's  results of  operations or  financial
  condition.  However the costs of such actions may vary from quarter to
  quarter, and there is no assurance that  there will not be a delay  in
  the Company's implementation  or increased costs  associated with  the
  implementation of such changes.  Failure to achieve Y2K readiness  for
  the Company could delay its ability  to manufacture and ship  products
  and deliver  services.    The Company's  inability  to  perform  these
  functions could have an adverse effect on future results of operations
  or financial condition.

  Non-IT systems include, but are not limited to, telephone/PBX systems;
  fax machines; facilities  systems regulating  alarms, building  access
  and sprinklers;  manufacturing, assembly  and distribution  equipment;
  and other miscellaneous systems and processes. Y2K readiness for these
  internal non-IT systems  is the  responsibility of  the Company's  Y2K
  coordinator.   It  is anticipated  that  all Non-IT  systems  will  be
  compliant if they are  not already compliant by  the end of the  third
  quarter of 1999.

  The  Company  regularly  reviews  and  monitors  the  suppliers'   Y2K
  readiness  plans  and  performance.   Based  on  the  Company's   risk
  assessment, selective  on-site  reviews may  be  performed.   In  some
  cases, to meet Y2K  readiness, the Company  has replaced suppliers  or
  eliminated suppliers from consideration for new business. The  Company
  has also contracted with multiple transportation companies to  provide
  product delivery alternatives.
<PAGE>
  While the  Company has  contingency plans  in  place to  address  most
  issues under its  control, an  infrastructure problem  outside of  its
  control could result in a delay in product shipments depending on  the
  nature and severity  of the problems.  The Company  would expect  that
  most utilities and service providers would be able to restore  service
  within days although more pervasive system problems involving multiple
  providers could  last two  to  four weeks  or  more depending  on  the
  complexity of the systems and  the effectiveness of their  contingency
  plans.  Although  the  Company  is  dedicating  substantial  resources
  towards attaining  Y2K readiness,  there is  no assurance  it will  be
  successful in its efforts to identify and address all Y2K issues. Even
  if the  Company  acts  in a  timely  manner  to complete  all  of  its
  assessments; identifies,  develops  and implements  remediation  plans
  believed to be adequate; and develops contingency plans believed to be
  adequate, some problems may not be identified or corrected in time  to
  prevent material adverse consequences  to the Company. The  discussion
  above     regarding      estimated completion dates, costs, risks  and
  other  forward-looking  statements  regarding  Y2K  is  based  on  the
  Company's best estimates given information that is currently available
  and is subject to  change. As the Company  continues to progress  with
  its Y2K initiatives, it may discover  that actual results will  differ
  materially from these estimates.

  Use of Forward-Looking Statements:    Certain statements contained  in
  MD&A are  forward-looking,  including statements  concerning  expected
  expenses, Year  2000  readiness, and  the  adequacy of  the  Company's
  sources of cash to finance its current and future operations.  Factors
  which  could   cause  actual   results  to   materially  differ   from
  management's expectations  include the  following:   general  economic
  conditions and growth in the  high tech industry; competitive  factors
  and pricing pressures; changes in product mix; the timely  development
  and acceptance  of new  products; inventory  risks  due to  shifts  in
  market domain; Year 2000 readiness of the Company's suppliers, and the
  risks described from time to time in the Company's SEC filings.

<PAGE>
                                 PART II

  OTHER INFORMATION

  Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

  On May 5, 1999, the Annual meeting of Shareholders of Interphase
  Corporation was held.  The following matter was voted upon and
  approved at the meeting.

  An election of directors of the Company to serve until the next annual
  meeting for the Company was held.  The following seven individuals
  were elected as Directors of the Company:

<TABLE>

  Nominee:               Votes Cast For      Votes Withheld
  --------               --------------      --------------
  <S>                      <C>                   <C>
  James F. Halpin          5,074,822             203,780
  Paul N. Hug              5,097,822             180,780
  Gregory B. Kalush        5,074,822             203,780
  R. Stephen Polley        5,073.289             205,313
  David H. Segrest         5,074,822             203,780
  S. Thomas Thawley        5,097,822             180,780
  William Voss             5,097,822             180,780

</TABLE>

  To be elected a director each individual must have received a
  plurality of all votes cast at the meeting of election of directors.



  Item 6.   Reports on form 8-K

            None

            Exhibits

  Exhibit 27     Financial Data Schedule


<PAGE>

  SIGNATURE

  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.


                                          INTERPHASE CORPORATION
                                          (Registrant)
  Date:  August 13, 1999

                                          /s/ Steven P. Kovac
                                          --------------------
                                          Steven P. Kovac
                                          Chief Financial Officer,
                                          Vice President of Finance
                                          and Treasurer
                                          (Principal Financial and
                                          Accounting officer)