UNITED  STATES
              SECURITIES  AND  EXCHANGE  COMMISSION
                     Washington, D.C.  20549

                           FORM  10-Q

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

          For the quarterly period ended June 30, 1999

                               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 0-22018

                  CELESTIAL  SEASONINGS,  INC.
     (Exact name of Registrant as specified in its charter)


              Delaware                         84-1097571
   (State or other jurisdiction of          (I.R.S. Employer
   incorporation or organization)         Identification No.)


          4600 Sleepytime Drive, Boulder CO  80301-3292
  (Address of principal executive offices, including zip code)

                         (303) 530-5300
      (Registrant's telephone number, including area code)


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 [ ]

As of July 30, 1999 the Registrant had 8,326,809 shares of Common
Stock,  $0.01  Par Value, outstanding. This report on  Form  10-Q
contains 17 pages.


<PAGE>
                    CELESTIAL  SEASONINGS,  INC.

                                INDEX

PART I - FINANCIAL INFORMATION
------------------------------
                                                PAGE(S)

ITEM 1. FINANCIAL STATEMENTS

        Unaudited consolidated income              3
        statements

        Unaudited consolidated balance sheets      4

        Unaudited consolidated statements of       5
        cash flows

        Notes to unaudited consolidated           6-8
        financial statements

ITEM 2. MANAGEMANT'S DISCUSSION AND ANALYSIS     9-13
        OF FINANCIAL CONDITION AND RESULTS OF
        OPERATIONS

PART II - OTHER INFORMATION
---------------------------

ITEM 1.  LEGAL PROCEEDINGS                        14

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K         14

SIGNATURES                                        15

                            PAGE 2

<PAGE>

                     CELESTIAL SEASONINGS, INC.
                   CONSOLIDATED INCOME STATEMENTS
              (in thousands, except per share amounts)
                             (unaudited)
<TABLE>
<CAPTION>

                                    Three Months Ended  Nine Months Ended
                                         June 30,           June 30,
                                    ------------------  -----------------
                                      1999      1998      1999      1998
                                    --------  --------  --------  -------
<S>                                  <C>       <C>       <C>      <C>
Case volume                            1,229       857     4,858    3,959

Net sales                            $20,737   $19,395   $89,975  $79,124
Cost of goods sold                     8,032     6,822    32,367   28,151
                                     -------   -------   -------  -------
      Gross profit                    12,705    12,573    57,608   50,973

Operating expenses:
      Selling and marketing            8,899    10,371    41,431   35,713
      General and administrative       1,459     1,528     4,437    4,619
      Amortization of intangibles        293       319       909      982
                                     -------   -------   -------  -------
          Total operating expenses    10,651    12,218    46,777   41,314

Operating income                       2,054       355    10,831    9,659
Interest expense                         131       154       559      386
                                     -------   -------   -------  -------
Income before income taxes             1,923       201    10,272    9,273
Income taxes                             721        77     3,852    3,570
                                     -------   -------   -------  -------
Net income                           $ 1,202   $   124   $ 6,420  $ 5,703
                                     =======   =======   =======  =======
Earnings per share-basic:
     Net income per common share     $  0.14   $  0.01   $  0.77  $  0.69
                                     =======   =======   =======  =======
     Weighted average common shares    8,322     8,285     8,314    8,233
                                     =======   =======   =======  =======
Earnings per share-assuming dilution:
     Net income per common share     $  0.14   $  0.01   $  0.72  $  0.65
                                     =======   =======   =======  =======
     Weighted average common shares    8,753     8,898     8,858    8,730
                                     =======   =======   =======  =======
</TABLE>

     See accompanying notes to unaudited consolidated financial statements.

                                PAGE 3


<PAGE>
                    CELESTIAL  SEASONINGS,  INC.
                    CONSOLIDATED  BALANCE  SHEETS
                       (dollars in thousands)
                             (unaudited)

                               ASSETS
<TABLE>
<CAPTION>
                                             June 30,       September 30,
                                               1999             1998
                                             --------       ------------
<S>                                          <C>               <C>
Current assets:
  Cash and cash equivalents                  $   202           $ 2,533
  Accounts receivable, net of allowance
    (June - $659 Sept. - $534)                12,383            15,156
  Inventory                                   17,282            23,185
  Deferred income taxes                          101                93
  Prepaid income taxes                           440               630
  Prepaid expenses                             2,270             2,111
                                             -------           -------
        Total current assets                  32,678            43,708

Property, plant and equipment, net            20,341            19,240
Intangible assets, net                        12,084            12,598
Goodwill, net                                  5,660             5,870
Deferred income taxes                            174               217
Other assets                                   3,826             1,014
                                             -------           -------
Total assets                                 $74,763           $82,647
                                             =======           =======

                LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Accounts payable                           $ 4,521           $ 8,656
  Accrued liabilities and wages                4,382             7,551
  Accrued interest payable                        28                47
  Current portion of long-term debt              350             4,323
                                             -------           -------
      Total current liabilities                9,281            20,577

Long-term debt                                 7,390            10,750

Commitments

Stockholders' equity:
  Common stock, $.01 par value -
   authorized 15,000,000 shares;
   June - issued 8,340,220 shares,
   outstanding 8,322,420 shares;
   Sept. - issued 8,322,528 shares,
   outstanding 8,304,728 shares                   83                83
  Capital surplus                             35,363            35,011
  Retained earnings                           22,821            16,401
  Treasury stock, 17,800 shares of
   common stock at cost                         (175)             (175)
                                             -------           -------
      Total stockholders' equity              58,092            51,320
                                             -------           -------
Total liabilities and stockholders' equity   $74,763           $82,647
                                             =======           =======
</TABLE>

     See accompanying notes to unaudited consolidated financial statements.

                                 PAGE 4

<PAGE>

                     CELESTIAL SEASONINGS, INC.
                CONSOLIDATED STATEMENTS OF CASH FLOWS
                           (in thousands)
                             (unaudited)

<TABLE>
<CAPTION>
                                                       Nine Months Ended
                                                            June 30,
                                                       -----------------
                                                        1999      1998
                                                       -------   -------

<S>                                                    <C>       <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                             $ 6,420   $ 5,703
  Adjustments to reconcile net income to net cash
    provided by (used in) operating activities:
    Depreciation                                         1,270       960
    Amortization of intangibles                            909       982
    Amortization of financing fees                         158       146
    Deferred income taxes                                   35      (334)
    Gain on sale of asset                                 (100)        -
  Changes in operating assets and liabilities:
    Accounts receivable                                  2,773    (4,785)
    Inventory                                            5,903   (15,272)
    Prepaid income taxes                                   190         -
    Prepaid expenses                                      (159)     (405)
    Accounts payable                                    (4,135)    3,397
    Accrued liabilities and wages                       (3,169)    1,736
    Accrued income taxes                                     -       355
    Accrued interest payable                               (19)       36
                                                       -------   -------
Net cash provided by (used in) operating activities     10,076    (7,481)
                                                       -------   -------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Proceeds from sale of asset                              148         -
  Capital expenditures                                  (2,419)   (1,720)
  Increase in intangible assets                           (185)     (300)
  (Increase) decrease in other assets                   (2,970)      575
                                                       -------   -------
Net cash used in investing activities                   (5,426)   (1,445)
                                                       -------   -------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from common stock issuance                      352     1,153
  Increase in long-term debt                             7,035     7,250
  Reduction in long-term debt                          (14,368)     (258)
                                                       -------   -------
Net cash (used in) provided by financing activities     (6,981)    8,145
                                                       -------   -------
NET DECREASE IN CASH AND CASH EQUIVALENTS               (2,331)     (781)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD         2,533     2,829
                                                       -------   -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD             $   202   $ 2,048
                                                       =======   =======
CASH PAID FOR INTEREST                                 $   422   $   179
CASH PAID FOR INCOME TAXES                             $ 3,627   $ 3,549
</TABLE>
See accompanying notes to unaudited consolidated financial statements

                              PAGE 5

<PAGE>

                     CELESTIAL SEASONINGS, INC.
        NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS


1.   GENERAL

      Basis  of Presentation - Each fiscal quarter includes  thirteen
weeks.  The Company's third fiscal quarter ends on the last  Saturday
of June. For presentation purposes, however, the third fiscal quarter
is presented as if it ended on June 30.

      The  unaudited  consolidated financial statements  include  the
accounts  of the Company and its subsidiaries. Intercompany  balances
have been eliminated in consolidation.

      Interim  Financial  Information  -  The  financial  information
contained  herein is unaudited but includes all normal and  recurring
adjustments  which, in the opinion of management,  are  necessary  to
present  fairly the information set forth. The unaudited consolidated
financial  statements  should  be  read  in  conjunction   with   the
consolidated financial statements which are included in the Company's
Annual Report on Form 10-K for the year ended September 30, 1998. The
Company's  business  is  seasonal;  therefore,  results  for  interim
periods are not necessarily indicative of results to be expected  for
the fiscal year of the Company ending September 30, 1999. The Company
believes   that  this  Quarterly  Report  filed  on  Form   10-Q   is
representative of its financial position, its results  of  operations
and  its  cash  flows for the periods ended June 30,  1999  and  1998
covered thereby.

      Earnings  Per Share - In accordance with Statement of Financial
Accounting  Standards No. 128, "Earnings per Share," the increase  in
weighted  average common shares - assuming dilution  is  due  to  the
application  of  the  treasury  share method  for  outstanding  stock
options. The application of the treasury share method resulted in  an
additional 431,000 and 613,000 weighted average shares for the  three
months ended  June 30, 1999 and 1998, respectively, and an additional
544,000 and 497,000 weighted average shares for the nine months ended
June 30, 1999 and 1998 respectively.

      Comprehensive  Income - In June 1997, the Financial  Accounting
Standards  Board  issued Statement of Financial Accounting  Standards
No.  130  ("SFAS  130"), "Reporting Comprehensive Income."  SFAS  130
requires   companies  to  disclose  comprehensive  income   and   its
components. The Company currently has no items of other comprehensive
income and therefore SFAS 130 does not apply.


                               PAGE 6


<PAGE>

      Operating  Segments - Commencing with fiscal 1999, the  Company
redefined  its reportable segments as wellness products and  beverage
products.  The  wellness  segment  includes  the  Company's   dietary
supplements  in  capsule form along with related wellness  teas.  The
beverage segment contains the Company's herb, green, specialty black,
organic and chai teas. The Company believes that its current forms of
advertising  are  designed  to develop an  overall  brand  awareness.
Therefore,  advertising  is  treated  as  a  corporate  expense,  not
directly   attributable  to  any  one  segment.  Trade  and  consumer
promotion expenses for specific product lines are charged directly to
operating segments.
<TABLE>
<CAPTION>
                               Three months ended      Nine months ended
                                    June 30,               June 30,
                               ------------------      -----------------
                                 1999      1998          1999      1998
                               -------   -------       -------   -------
<S>                            <C>       <C>           <C>       <C>
Net sales:
     Beverages                 $17,003   $11,644       $73,639   $62,334
     Wellness                    3,734     7,751        16,336    16,790
                               -------   -------       -------   -------
          Total net sales      $20,737   $19,395       $89,975   $79,124
                               =======   =======       =======   =======
Operating income (loss):
     Beverages                 $ 4,001   $ 2,976       $22,408   $17,763
     Wellness                      (86)    1,246           378     2,662
                               -------   -------       -------   -------
                                 3,915     4,222        22,786    20,425
     Corporate advertising
       expense                    (109)   (2,020)       (6,609)   (5,165)
     General and administrative (1,459)   (1,528)       (4,437)   (4,619)
     Amortization of intangibles  (293)     (319)         (909)     (982)
                               -------   -------       -------   -------
       Total operating income    2,054       355        10,831     9,659
Interest expense                   131       154           559       386
                               -------   -------       -------   -------
Income before income taxes     $ 1,923   $   201       $10,272   $ 9,273
                               =======   =======       =======   =======
<CAPTION>
                                  June 30,       September 30,
                                    1999             1998
                                  --------        -----------
<S>                                <C>               <C>
Assets:
     Beverages                     $57,388           $55,894
     Wellness                       13,336            20,341
     Corporate                       4,039             6,412
                                   -------           -------
            Total assets           $74,763           $82,647
                                   =======           =======
</TABLE>
                                    PAGE 7

<PAGE>

2.   DETAIL OF INVENTORY ACCOUNTS
<TABLE>
<CAPTION>
                                June 30,       September 30,
                                  1999            1998
                                -------         -----------
<S>                             <C>               <C>
Raw materials and supplies      $ 9,860           $10,941
Work in process                   1,774             2,047
Finished goods                    5,915            10,406
                                -------           -------
                                 17,549            23,394
Less inventory reserves             267               209
                                -------           -------
Total                           $17,282           $23,185
                                =======           =======
</TABLE>

3.   LEGAL  PROCEEDINGS

      On May 5, 1995, a purported stockholder of the Company filed  a
lawsuit,  Schwartz  v. Celestial Seasonings, Inc.  et.  al.,  in  the
United  States  District Court for the District  of  Colorado  (Civil
Action  Number:   95-K-1045), in connection with disclosures  by  the
Company concerning the Company's license agreement with Perrier Group
of  America,  Inc.  which  was terminated on  January  1,  1995.   In
addition to the Company, the complaint names as defendants certain of
the Company's present and former directors and officers, PaineWebber,
Inc., Shearson/Lehman Brothers, Inc., and Vestar/Celestial Investment
Limited Partnership.  The complaint, which was pled as a class action
on  behalf  of persons who acquired the Company's common  stock  from
July  12,  1993 through May 18, 1994, sought money damages  from  the
Company and the other defendants for the class in the amount of their
loss  on  their  investment in the Company's common  stock,  punitive
damages,  costs and expenses of the action, and such other relief  as
the court may order.

     On November 6, 1995, the federal district court granted a motion
by  the  Company and the other defendants to dismiss  the  case.   On
September  5,  1997,  however,  the court  of  appeals  reversed  the
decision  of the district court and returned the case to the district
court for further proceedings. The case has been certified as a class
action.  Due to the uncertainties inherent in the litigation process,
the Company is unable to predict the outcome of this matter.

                              PAGE 8

<PAGE>


                    CELESTIAL  SEASONINGS,  INC.
       MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL
               CONDITION  AND  RESULTS  OF OPERATIONS

SEASONALITY

      The Company's business is seasonal and its quarterly results of
operations reflect the results of increased demand for the  Company's
hot  tea  products  in the cooler months of the year.  The  following
table  sets forth selected unaudited quarterly consolidated financial
and operational data for the seven most recent quarters.
<TABLE>
<CAPTION>
                                Quarter Ended
             ------------------------------------------------------------------
                 Fiscal 1999                          Fiscal 1998
             ---------------------------- ------------------------------------
              June 30  Mar. 31  Dec. 31   Sept. 30  June 30  Mar. 31  Dec. 31
              -------  -------  -------   --------  -------  -------  -------
                                   (in thousands)
<S>            <C>      <C>      <C>        <C>      <C>      <C>      <C>
Case volume      1,229    1,733    1,896      1,120      857    1,611    1,491
Net sales      $20,737  $31,576  $37,662    $23,073  $19,395  $32,329  $27,400
Gross profit    12,705   21,244   23,659     14,586   12,573   21,131   17,269
Operating income 2,054    4,367    4,410      1,782      355    5,549    3,755
Operating margin   9.9%    13.8%    11.7%       7.7%     1.8%    17.2%    13.7%
Net income     $ 1,202  $ 2,613  $ 2,605    $ 1,053  $   124  $ 3,341  $ 2,238
Percent of fiscal
 year net sales   N/A      N/A      N/A        22.6%    19.0%    31.6%    26.8%
</TABLE>

     Quarterly fluctuations in sales volume and operating results are
due to a number of factors, including the timing of trade promotions,
advertising,   consumer  promotions,  production   requirements   and
inventory  adjustments by customers. Due to the timing and extent  of
these factors the impact on sales volume and operating results can be
significant.

RESULTS OF OPERATIONS

      The  following  table is derived from the  Company's  unaudited
consolidated income statements for the periods indicated and presents
(i)  the results of operations as a percentage of net sales and  (ii)
the  percentage change in the dollar amounts of each  item  from  the
prior period.
<TABLE>
<CAPTION>
                                                     Period-to-Period
                       Percentage of Net Sales  Percentage Increase/(Decrease)
                       -----------------------  -----------------------------
                      Three Months Nine Months  Three Months   Nine Months
                         Ended       Ended         Ended          Ended
                        June 30,    June 30,      June 30,       June 30,
                      -----------  ----------   -----------    -----------
                      1999   1998   1999  1998   1999 to 1998   1999 to 1998
                      ----   ----   ----  ----   ------------   ------------
<S>                  <C>    <C>    <C>    <C>       <C>             <C>
Net sales            100.0% 100.0% 100.0% 100.0%     6.9%           13.7%
Cost of goods sold    38.7   35.2   36.0   35.6     17.7            15.0
                     -----  -----  -----  -----
Gross profit          61.3   64.8   64.0   64.4      1.0            13.0
Total operating
  expenses            51.4   63.0   52.0   52.2    (12.8)           13.2
                     -----  -----  -----  -----
Operating income       9.9    1.8   12.0   12.2    478.6            12.1
Interest expense       0.6    0.8    0.6    0.5    (14.9)           44.8
                     -----  -----  -----  -----
Income before income
  taxes                9.3    1.0   11.4   11.7    856.7            10.8
Income taxes           3.5    0.4    4.3    4.5    836.4             7.9
                     -----  -----  -----  -----
Net income             5.8%   0.6%   7.1%   7.2%   869.4%           12.6%
                     =====  =====  =====  =====
</TABLE>
                               PAGE 9

<PAGE>

THREE MONTHS ENDED JUNE 30, 1999 COMPARED TO THE THREE MONTHS ENDED
JUNE 30, 1998

      Net  sales. Net sales for the three months ended June 30,  1999
increased 6.9% to $20.7 million from $19.4 million for the comparable
period  in  fiscal  1998. The net sales increase was  the  result  of
increased  sales of the Company's beverage products to $17.0  million
during  the third quarter of fiscal 1999 from $11.6 million  for  the
comparable  period  in 1998. A large portion of the  increased  sales
represents shipments of the Company's hot herb and green tea products
which  were  delayed from the second quarter of fiscal  1999  to  the
third   quarter   due  to  warehouse  transition  issues.   Warehouse
transition issues experienced during the prior quarter were  resolved
during  the  quarter  ended June 30, 1999. The increase  in  beverage
product  sales was partially offset by a 51.8% decrease in  sales  of
the Company's wellness products to $3.7 million from $7.8 million for
the  comparable prior year period. A general softness in the  dietary
supplements  category this year and initial sales to  retailers  last
year  to  establish stocking levels contributed to the  decline.  The
Company  is  currently transitioning from a 30-count  to  a  60-count
dietary supplements line. The new 60-count line has a reduced  number
of  products  and new, more cost effective formulations. The  Company
believes  that  the 60-count line will put it in a  more  competitive
position in the dietary supplements market. Discounts offered on  the
30-count  inventory  in addition to decreased  sales  volume  of  the
Company's  dietary  supplements products  contributed  to  the  sales
decline.  An increase in sales of the Company's wellness tea products
partially offset this decline.

      Gross profit. Gross profit for the three months ended June  30,
1999  increased  1.0%  to $12.7 million from $12.6  million  for  the
comparable  period in fiscal 1998. The Company's gross profit  margin
as  a  percent  of net sales decreased to 61.3% from  64.8%  for  the
comparable  prior  year  period.  The Company  experienced  decreased
margins  in its wellness segment due to discounts offered on  dietary
supplement  products.  Lower margins from its wellness  products  are
expected  to  continue  for  the next few  quarters  as  the  Company
transitions  its customers to the new 60-count line of capsules  from
the  existing  30-count line. The Company is implementing  production
improvements that it believes will permit gross margins to recover to
that of previous levels for capsule products.

      Operating  expenses.  Total operating expenses  for  the  three
months  ended  June  30, 1999 decreased 12.8% to $10.7  million  from
$12.2 million for the comparable period in fiscal 1998, and decreased
as  a  percentage of net sales to 51.4% from 63.0%. The  decrease  in
operating   expenses  was  primarily  due  to  decreased  advertising
expenses,  mostly resulting from differences in timing versus  fiscal
1998.  During  fiscal 1999 most of the Company's  annual  advertising
budget  was  utilized  during the first half of  the  year.  Consumer
promotion  expenses also experienced a significant decrease  for  the
third  quarter  of fiscal 1999 from the comparable period  in  fiscal
1998, primarily due to fiscal 1998 expenses associated with promoting
the  Company's  dietary  supplement products.  These  decreases  were
partially  offset  by  increased trade  promotion  expenses  for  the
Company's beverage products.

       Operating income. Operating income for the three months  ended
June 30, 1999, increased 478.6% to $2.1 million from $0.4 million for
the comparable period in fiscal 1998 and as a percentage of net sales
increased  to  9.9%  from 1.8%, primarily due to decreased  operating
expenses.

                               PAGE 10

<PAGE>

NINE MONTHS ENDED JUNE 30, 1999 COMPARED TO THE NINE MONTHS ENDED
JUNE 30, 1998

      Net  sales. Net sales for the nine months ended June  30,  1999
increased  13.7%  to  $90.0  million  from  $79.1  million  for   the
comparable period in fiscal 1998. Net sales of the Company's beverage
products increased 18.1% to $73.7 million from $62.3 million for  the
comparable  period  in  fiscal 1998. Net  sales  growth  of  beverage
products was primarily the result of increased sales of the Company's
herb   and  green  tea  products.  The  Company's  wellness  products
contributed net sales of approximately $16.3 million during the  nine
months  ended  June 30, 1999, as compared to $16.8  million  for  the
comparable period in 1998, a decrease of 2.7%.

      Gross  profit. Gross profit for the nine months ended June  30,
1999  increased  13.0% to $57.6 million from $51.0  million  for  the
comparable  period in fiscal 1998. The Company's gross profit  margin
as  a  percent of net sales remained relatively unchanged from  1998.
The Company experienced increased margins in its beverage segment due
to  increased  sales  of  its higher margin green  tea  products  and
decreased sales of its lower margin specialty black tea products. The
increase was partially offset by the effect of lower margins realized
on sales of the Company's dietary supplement products.

     Operating expenses. Total operating expenses for the nine months
ended  June  30,  1999 increased 13.2% to $46.8  million  from  $41.3
million for the comparable period in fiscal 1998, and as a percentage
of net sales remained relatively unchanged. The increase in operating
expenses  was  primarily  due to increased trade  promotion  expenses
associated  with  ongoing  development  of  the  Company's   wellness
products  and increased advertising expenses associated with building
its brand awareness.

      Operating  income. Operating income for the nine  months  ended
June 30, 1999, increased 12.1% to $10.8 million from $9.7 million for
the  comparable  period in fiscal 1998, and as a  percentage  of  net
sales remained relatively unchanged. The increase is primarily due to
increased  sales  and  gross  profit  and  was  partially  offset  by
increased operating expenses.

      Interest  expense. Interest expense for the nine  months  ended
June  30,  1999 increased 44.8% from the comparable period in  fiscal
1998  primarily  as  a  result  of  increased  borrowings  under  the
Company's  credit facility in support of inventories of its  wellness
capsule products and accounts receivable.

                               PAGE 11

<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

     The operations of the Company historically have been funded with
a  combination of internally generated funds and external borrowings.
Other  than funding ongoing operations, the Company's principal  uses
of  funds in the future are expected to be the development of new  or
existing  beverage and wellness products and the possible acquisition
of  brands,  product lines or other assets. The Company  expects  its
primary sources of financing for its future business activities  will
be funds from operations plus borrowings under credit facilities. The
Company  currently  believes that funds  from  operations  and  funds
expected  to  be available under the Company's credit facilities  are
likely  to  be  sufficient to meet operating and capital requirements
unless a significant acquisition is made.

      Cash  and cash equivalents decreased $2.3 million for the  nine
months ended June 30, 1999. Cash provided by operating activities was
$10.1  million for the nine months ended June 30, 1999. The Company's
investing   activities  used  cash  of  $5.4  million  and  financing
activities  used cash of $7.0 million for the nine months ended  June
30, 1999.

     The  Company incurred capital expenditures of approximately $2.6
million  during  the nine months ended June 30, 1999, including  $2.4
million  for factory and computer equipment and $0.2 million for  the
design   and  development  of  new  packaging  artwork.  The  Company
currently  anticipates  making  additional  capital  expenditures  of
approximately  $3.0  million during the  remainder  of  fiscal  1999,
primarily  for  the  installation of a new  production  line  at  the
Company's existing facility.

YEAR 2000 COMPLIANCE

     A  number  of  computer programs are written  using  two  digits
rather than four to define the applicable year. As a result, computer
programs that have time-sensitive software may recognize a date using
"00" as the year 1900 rather than the year 2000. This could result in
a   system   failure  or  miscalculations  causing   disruptions   of
operations,  including, among other things, a temporary inability  to
process  transactions,  send invoices, or engage  in  similar  normal
business activities.

     The  Company,  after  an inventory of its business  systems  and
business interactions, has executed a plan to prepare its systems and
business  relationships for the Year 2000. The Company  believes  all
internal  components  of  its systems are Year  2000  compliant.  The
Company  has  developed  a  contingency  plan  which  includes   non-
computerized backup systems and will remain in effect until the  year
2000.

     The  ability of the Company to achieve Year 2000 compliance  is,
however,  highly  dependent upon compliance of  the  systems  of  the
Company's customers, suppliers and other third parties with which the
Company  has business relationships. Through communication  with  key
supply chain partners the Company believes that most, if not all, are
Year 2000 compliant.

     The total cost to the Company of Year 2000 compliance activities
has  not  yet  been, and is not anticipated to be,  material  to  the
Company's  financial position or results of operations in  any  given
year.  These  costs,  and  the Company's  achievement  of  Year  2000
compliance,  are  based  on management's best estimates,  which  were
derived  using  numerous assumptions of future events  including  the
continued availability of certain resources, third party modification
plans  and  other  factors. However, there can be no  guarantee  that
these estimates will be achieved and actual results could differ from
those plans.

                              PAGE 12

<PAGE>

FORWARD LOOKING STATEMENTS

      The  statements contained in this Quarterly Report on Form 10-Q
which  are  not  historical facts, including,  but  not  limited  to,
statements   found  under  the  captions  "Results  of   Operations,"
"Liquidity  and Capital Resources" and "Year 2000 Compliance"  above,
are  forward-looking statements that involve a number  of  risks  and
uncertainties.  The actual results of the future events described  in
such  forward-looking statements could differ materially  from  those
stated  in  such forward-looking statements.  Among the factors  that
could  cause  actual results to differ materially are the  risks  and
uncertainties discussed in this Quarterly Report, including,  without
limitation,   the  portions  of  such  reports  under  the   captions
referenced above, and the uncertainties set forth from time  to  time
in the Company's filings with the Securities and Exchange Commission,
and  other  public statements. Such risks and uncertainties  include,
without  limitation, seasonality, interest in the Company's products,
general  economic  conditions,  consumer  trends,  inventory   levels
maintained by customers, costs and availability of raw materials  and
management information systems, manufacturing processes, competition,
litigation  and  the effect of governmental regulation.  The  Company
disclaims  any  intention or obligation to update any forward-looking
statements, whether as a result of new information, future events  or
otherwise.

                                PAGE 13

<PAGE>

PART II   OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS
--------------------------
The  information  in  Note 3 to the Unaudited Consolidated  Financial
Statements included in Part I is incorporated herein.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
-----------------------------------------
(a)  Exhibits
     --------
Exhibit No.                       Description
----------                        -----------
 23.1        - Report   of   Deloitte  &  Touche  LLP   on   unaudited
               consolidated financial statements


(b) Reports on Form 8-K
    -------------------
     There were no reports on Form 8-K for the quarter ended June 30, 1999.


                                PAGE 14

<PAGE>

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.



                    CELESTIAL SEASONINGS, INC.
                    (Registrant)


     August 6, 1999 By:  /s/ Darrell F. Askey
                        ---------------------
                         Darrell F. Askey
                         Vice President - Finance and Chief Financial
                         Officer
                         (Principal Financial Officer)

                               PAGE 15

<PAGE>


                         INDEX TO EXHIBITS


The following exhibits are filed pursuant to Item 601 of Regulation S-K.

                                                       Sequentially
Exhibit No.                Description                Numbered Pages
-----------                -----------                --------------
  23.1          - Report of Deloitte & Touche LLP on
                  unaudited consolidated financial          17
                  statements

                              PAGE 16