SECURITIES AND EXCHANGE COMMISSION
                       Washington, D.C. 10549
                             FORM 10-QSB



(Mark One)

[x]    Quarterly report under Section 13 or 15(D) of the Securities
       Exchange Act of 1934

            For the quarterly period ended June 30, 1999

[ ]    Transition report under Section 13 or 15(D) of the Exchange Act

            For the transition period from _________ to _________


Commission file number 0-15888


                        IGENE Biotechnology, Inc.
  _________________________________________________________________
  (Exact name of Small Business Issuer as Specified in its Charter)


          Maryland                              52-1230461
_______________________________         ___________________________
(State or Other Jurisdiction of         (I.R.S. Employer
 Incorporation or organization)          Identification No.)


         9110 Red Branch Road, Columbia, Maryland 21045-2024
         ___________________________________________________
              (Address of Principal Executive Offices)

                           (410) 997-2599
          ________________________________________________
          (Issuer's Telephone Number, Including Area Code)

                                 None
        ____________________________________________________
        (Former Name, Former Address and Former Fiscal Year,
                    if Changed Since Last Report)



Check whether the Issuer: (1) filed all reports required to be filed
by Section 13 or 15(D) of the Exchange Act during the past 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
	________                ________


State  the  number  of  shares  outstanding of each of  the issuer's
classes of common equity, as of the latest practicable date:
34,427,507 as of July 26, 1999.

Traditional Small Business Disclosure Format (check one):

Yes                      No       x
      ________                ________

                               -Page 1-

                             FORM 10-QSB
                      IGENE Biotechnology, Inc.


                                INDEX



PART I    -    FINANCIAL INFORMATION
                                                                 Page

          Balance Sheets                                         5-6

          Statements of Operations                                 7

          Statements of Stockholder's Deficit                    8-9

          Statements of Cash Flows                             10-11

          Notes to Financial Statements                        12-13

          Management's Discussion and Analysis of Financial
          Conditions and Results of Operations                 14-17

PART II   -    OTHER INFORMATION                                  18

SIGNATURES                                                        19

                              -Page 2-

                      IGENE BIOTECHNOLOGY, INC.

             QUARTERLY REPORT UNDER SECTION 13 OR 15(D)

               OF THE SECURITIES EXCHANGE ACT OF 1934

                              -Page 3-

                               PART I

                        FINANCIAL INFORMATION

                              -Page 4-

<TABLE>
                      IGENE Biotechnology, Inc.
                           Balance Sheets

<CAPTION>
                                            June 30,     June 30,    December 31,
                                               1999         1998            1998
                                         ___________  ___________    ____________
                                         (Unaudited)  (Unaudited)
<S>                                      <C>          <C>            <C>
ASSETS
CURRENT ASSETS

  Cash and cash equivalents              $   63,185   $1,414,683      $  364,796
  Accounts receivable                         8,955      210,275             ---
  Inventory                                 990,320      216,156         870,260
  Supplies                                   10,669        4,710          11,145
  Prepaid expenses                          212,813      354,086          83,933
  Loan receivable, current portion          206,780      261,940         250,783
                                         ___________  ___________    ____________

                                          1,492,722    2,461,850       1,580,917


OTHER ASSETS
  Property and equipment, net               356,404      327,948         370,057
  Loan receivable, net of current portion       ---      116,552             ---
  Debt issue costs                          158,784      211,712         179,956
  Security deposits                           4,875       10,600          10,600
                                         ___________  ___________    ____________

     TOTAL ASSETS                        $2,012,785   $3,128,662      $2,141,530
                                         ===========  ===========    ============

</TABLE>

The accompanying notes are an integral part of the financial statements.


                             -Page 5-

<TABLE>
                    IGENE Biotechnology, Inc.
                         Balance Sheets
                           (continued)

<CAPTION>
                                            June 30,     June 30,    December 31,
                                               1999         1998            1998
                                         ___________  ___________    ____________
                                         (Unaudited)  (Unaudited)
<S>                                      <C>          <C>            <C>
LIABILITIES, REDEEMABLE PREFERED STOCK
  AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
  Accounts payable and accrued expenses  $  186,971   $  521,427      $  228,549
  Debenture interest payable                 45,000       45,000          45,000
                                         ___________  ___________     ___________
     TOTAL CURRENT LIABILITIES              231,971      566,427         273,549

LONG-TERM DEBT
  Notes payable                           6,158,199    6,082,500       6,092,500
  Variable rate subordinated debenture    1,500,000    1,500,000       1,500,000
  Accrued Interest                          608,250          ---         364,950
                                         ___________  ___________     ___________
     TOTAL LIABILITIES                    8,498,420    8,148,927       8,230,999
                                         ___________ ____________     ___________
COMMITMENTS AND CONTINGENCIES

REDEEMABLE PREFERRED STOCK
  Carrying amount of redeemable preferred
     stock, 8% cumulative, convertible,
     voting, series A, $.01 par value per
     share. Redemption value $14.88, $14.24,
     and $14.56, respectively.  Authorized
     1,312,500 shares, issued 29,592, 29,592,
     and 29,592 shares, respectively        440,329      421,390         430,860
                                         ___________ ____________     ___________

STOCKHOLDERS' DEFICIT
  Preferred stock, $.01 par value per share,
     8% cumulative, convertible, voting,
     series A. Authorized, issued and
     outstanding -0-,187,500 and -0- shares.
     Aggregate involuntary liquidation
     value of $-0-, $2,670,000, and
     $-0-, respectively.                        ---        1,875             ---
  Common stock, $.01 par value per share.
     Authorized, 250,000,000 shares;
     issued and outstanding 34,427,507,
     21,441,473, and 21,854,173 shares,
     respectively.                          344,275      214,415         218,542
  Additional paid-in capital             19,442,586   18,659,740      18,738,038
  Deficit                               (26,712,825) (24,317,685)    (25,476,909)
                                        ____________ ____________    ____________
     TOTAL STOCKHOLDERS' DEFICIT         (6,925,964)  (5,441,655)     (6,520,329)
                                        ____________ ____________    ____________
     TOTAL LIABILITIES AND
       STOCKHOLDERS'  DEFICIT            $2,012,785   $3,128,662      $2,141,530
                                        ============ ============    ============

</TABLE>

The accompanying notes are an integral part of the financial statements.

                             -Page 6-

<TABLE>
                    IGENE Biotechnology, Inc.
                    Statements of Operations
                           (Unaudited)

<CAPTION>
                                               Three months ended          Six months ended
                                           _______________________    ________________________
                                              June 30,    June 30,        June 30,     June 30,
                                                 1999        1998            1999         1998
                                           ___________ ___________    ____________ ____________
<S>                                        <C>         <C>            <C>          <C>
Sales                                      $      ---  $  203,675     $       ---  $   203,675
Cost of sales                                  99,409     306,252         119,845      605,051
                                           ___________ ___________    ____________ ____________
  Gross profit (loss)                         (99,409)   (102,577)       (119,845)    (401,376)

Technology licensing income                     2,007         ---           3,174          ---
                                           ___________ ___________    ____________ ____________
  Net revenue                                 (97,402)   (102,577)       (116,671)    (401,376)
                                           ___________ ___________    ____________ ____________
Selling, General & Administrative expenses:
  Marketing and selling                        46,475         300          52,925          689
  Research, development and pilot plant        90,102      90,483         190,400      223,685
  General and administrative                   82,909     180,847         173,720      316,548
  Litigation expenses                         182,757      22,737         358,494      183,698
                                           ___________ ___________    ____________ ____________
     Total operating expenses                 402,243     294,067         775,539      724,620
                                           ___________ ___________    ____________ ____________
     Operating loss                          (499,645)   (396,944)       (892,210)  (1,125,996)
                                           ___________ ___________    ____________ ____________
Other income (expense)
  Interest expense, net of
     interest income of $4,277, $26,231,
     $10,948 and $37,734, respectively       (173,059)   (148,939)       (343,706)    (211,194)
  Loss on disposal of equipment                   ---      (3,280)            ---       (3,280)
                                           ___________ ___________    ____________ ____________
     Net loss                              $ (672,704) $ (549,163)    $(1,235,916) $(1,340,470)
                                           =========== ===========    ============ ============
     Net loss per common share             $    (0.02) $    (0.03)    $     (0.04) $     (0.07)
                                           =========== ===========    ============ ============

</TABLE>

  The accompanying notes are an integral part of the financial
                           statements.

                             -Page 7-
<TABLE>

                    IGENE Biotechnology, Inc.
               Statements of Stockholders' Deficit
                           (Unaudited)


<CAPTION>
                                      Redeemable Preferred Stock          Preferred Stock
                                           (shares/amount)                (shares/amount)
                                      __________________________     __________________________
<S>                                   <C>           <C>              <C>           <C>
Balance at December 31, 1997               29,592   $ 411,920           187,500    $  1,875

Cumulative undeclared dividends
  on redeemable preferred stock               ---       9,470               ---         ---

Issuance of common stock through
  exercise of employee stock options          ---         ---               ---         ---

Issuance of common stock in lieu of
  cash in payment of interest on
  subordinated debenture                      ---         ---               ---         ---

Issuance of common stock in lieu of
  cash in payment of legal fees               ---         ---               ---         ---

Capital contribution - forgiveness of
  interest on promissory notes                ---         ---               ---         ---

Net loss for six months
  ended June 30, 1998                         ---         ---               ---         ---
                                      ____________  ____________     ___________   ___________
Balance at June 30, 1998                   29,592   $ 421,390           187,500    $  1,875
                                      ============  ============     ===========   ===========

Balance at December 31, 1998               29,592   $ 430,860               ---    $    ---

Cumulative undeclared dividends
  on redeemable preferred stock               ---       9,469               ---         ---

Issuance of common stock in lieu of
  cash in payment of interest on
  subordinated debenture                      ---         ---               ---         ---

Issuance of common stock in lieu of
  cash in payment of legal fees               ---         ---               ---         ---

Issuance of shares of common stock
  pursuant to direct purchase of shares
  by certain directors and other
  accredited investors (note 3)               ---         ---               ---         ---

Net loss for six months ended
  June 30, 1999                               ---         ---               ---         ---
                                      ____________  ____________     ___________   ___________
Balance at June 30, 1999                   29,592   $ 440,329               ---    $    ---
                                      ============  ============     ===========   ===========
</TABLE>

The accompanying notes are an integral part of the financial statements.

                             -Page 8-
<TABLE>
                    IGENE Biotechnology, Inc.
               Statements of Stockholders' Deficit
                     (Unaudited - Continued)

<CAPTION>
                                                            Additional                    Total
                                        Common Stock         Paid-in                   Stockholders'
                                       (shares/amount)       Capital       Deficit       Deficit
                                     ____________________  ____________ _____________ _____________
<S>                                  <C>         <C>       <C>          <C>           <C>
Balance at December 31, 1997         19,206,473  $192,065  $18,233,670  $(22,977,215) $(4,549,605)
Cumulative undeclared dividends
   on redeemable preferred stock            ---       ---       (9,470)          ---       (9,470)

Issuance of common stock through
   exercise of employee stock options     5,000        50          200           ---          250

Issuance of common stock in lieu of
   cash in payment of interest on
   subordinated debenture                40,000       400       89,600           ---       90,000

Issuance of common stock in lieu of
   cash in payment of legal fees      2,190,000    21,900      140,100           ---      162,000

Capital contribution - forgiveness of
   interest on promissory notes             ---       ---      205,640           ---      205,640

Net loss for six months ended
   June 30, 1998                            ---       ---          ---    (1,340,470)  (1,340,470)
                                     __________  ________  ____________ _____________ ____________
Balance at June 30, 1998             21,441,473  $214,415  $18,659,740  $(24,317,685) $(5,441,655)
                                     ==========  ========  ============ ============= ============
Balance at December 31, 1998         21,854,173  $218,542  $18,738,038  $(25,476,909) $(6,520,329)

Cumulative undeclared dividends
  on redeemable preferred stock             ---       ---       (9,469)          ---       (9,469)

Issuance of common stock in lieu of
   cash in payment of interest on
   subordinated debenture                40,000       400       89,600           ---       90,000

Issuance of common stock in lieu of
  cash in payment of legal fees         866,667     8,666       41,084           ---       49,750

Issuance of shares of common stock
  pursuant to direct purchase of shares
  by certain directors and other
  accredited investors (note 3)      11,666,760   116,668      583,332           ---      700,000

Net loss for six months ended
  June 30, 1999                             ---       ---          ---    (1,235,916)  (1,235,916)
                                     __________  ________  ____________ _____________ ____________
Balance at June 30, 1999             34,427,600  $344,276  $19,442,585  $(26,712,825) $(6,925,964)
                                     ==========  ========  ============ ============= ============

</TABLE>

The accompanying notes are an integral part of the financial statements.

                            -Page 9-
<TABLE>

                    IGENE Biotechnology, Inc.
                    Statements of Cash Flows
                           (Unaudited)


<CAPTION>
                                                                  Six months ended
                                                              June 30,       June 30,
                                                                 1999           1998
                                                         _____________  _____________
<S>                                                      <C>            <C>
Cash flows from operating activities:
   Net loss                                              $ (1,235,916)  $ (1,340,470)
   Adjustments to reconcile net loss to net cash provided
     By operating activities:
     Depreciation                                              41,600         20,325
     Amortization                                              21,172            ---
     Loss on disposal of equipment                                ---          3,280
     Interest on debenture paid in shares of common stock      90,000         90,000
     Decrease (increase) in:
       Accounts receivable                                     (8,955)      (195,781)
       Inventory                                             (120,060)      (216,156)
       Prepaid expenses and other current assets             (108,404)      (219,086)
     Increase (decrease) in:
       Accounts payable and accrued expenses             $    231,472   $    238,930
                                                         _____________  _____________

       Net cash used in operating activities             $ (1,089,091)  $ (1,618,958)
                                                         _____________  _____________
Cash flows from investing activities:
   Proceeds from disposal of equipment                            460          4,505
   Capital expenditures                                       (28,407)       (59,052)
   Refund of security deposit                                   5,725            ---
   Repayment of principal of loan receivable                   44,003        121,508
                                                         _____________  _____________
       Net cash provided by (used in) investing activities     21,781         66,961
                                                         _____________  _____________
Cash flows from financing activities:
   Repayments from (advances to) stockholders                     ---         28,594
Proceeds from issuance of common stock                        700,000            250
   Issuance of promissory notes                                65,699            ---
   Issuance of demand notes                                       ---        950,000
   Proceeds from rights offering                                  ---      2,438,288
   Repayment of demand notes                                      ---       (475,000)
                                                         _____________  _____________
       Net cash provided by financing activities              765,699      2,942,132
                                                         _____________  _____________
       Net increase (decrease) in cash
         and cash equivalents                                (301,611)     1,390,135

       Cash and cash equivalents
         at beginning of period                               364,796         24,548
                                                         _____________  _____________
                                                         $     63,185   $  1,414,683
                                                         =============  =============

</TABLE>

The accompanying notes are an integral part of the financial statements.

                           -Page 10-

                    IGENE Biotechnology, Inc.
                    Statements of Cash Flows
                     (Unaudited - Continued)

Noncash investing and financing activities:

During  the  six month ended June 30, 1999 and 1998, the  Company
recorded dividends in arrears on 8% redeemable preferred stock at
$.32  per  share  aggregating $ 9,469 and  $9,470,  respectively,
which  has been removed from paid-in capital and included in  the
carrying value of the redeemable preferred stock.

During  the  six  months ended June 30, 1998, the Company  issued
notes   payable   of   $5,000,000  through  a  rights   offering.
Stockholders  purchased  rights, using $1,875,000  in  promissory
notes  and $475,000 of demand notes due to the Company, resulting
in net cash proceeds of $2,438,288 which is after fees associated
with  the  offering of $211,712.  Theses related fees  have  been
capitalized  as debt issue costs and will be amortized  over  the
term of the debt.

During  the six months ended June 30, 1998, the Company cancelled
certain  promissory  notes  and  related  amounts  due   from   a
stockholder   aggregating  $125,000   by   agreement   with   the
stockholder.

During  the  six months ended June 30, 1999 and 1998 the  Company
issued 40,000 shares of common stock in each period in payment of
interest on the variable rate subordinated debenture.  If paid in
cash,  the interest would have been payable at 12% in the  amount
of  $90,000 in each period.  Shares may be issued in lieu of cash
under the terms of the debenture agreement at the higher of $2.25
per  share  or market price per share.  The stock was issued  and
related interest was paid at $2.25 per share, or $90,000, in each
period.

During  the  six  months ended June 30, 1998 the  Company  issued
stock  in  lieu of cash payments for legal services rendered  and
legal  retainers aggregating $162,000, based on the market  price
per share of common stock on the dates of the related agreements.
The  Company  recorded  the issue, on May 20,  1998,  of  190,000
shares  of common stock at $0.142 per share, or $27,000,  per  an
agreement  effective August 27, 1997, by reducing trade  accounts
payable  to the Company's patent counsel by $27,000.  The Company
also recorded the issue, on April 29, 1998 and June 26,1998 of  a
total of 2,000,000 shares of common stock at $.0675 per share, or
$135,000,  per  agreements  effective  February  20,   1998,   by
recording  $135,000  in  prepaid  expenses,  representing   legal
retainers on deposit with litigation counsel.

During  the six months ended June 30, 1999, the Company satisfied
accounts  payable  of  $20,000 and  advanced  $29,750  for  legal
retainers by issuing 866,667 shares of common stock to counsel in
on-going litigation.



The  accompanying  notes  are  an  integral part of the financial
statements.

                            -Page 11-

                    IGENE Biotechnology, Inc.
                  Notes to Financial Statements


(1)  Unaudited financial statements

     The  financial statements presented herein as  of  June  30,
     1999  and 1998 and for the three month and six month periods
     then  ended are unaudited, and in the opinion of management,
     include all adjustments (consisting only of normal recurring
     accruals)  necessary  for a fair presentation  of  financial
     position  and  results of operation and  cash  flows.   Such
     financial  statements do not include all of the  information
     and   footnote  disclosures  normally  included  in  audited
     financial  statements prepared in accordance with  generally
     accepted accounting principles.

(2)  Inventories

     Inventory, stated at lower of cost, on a first-in  first-out
     basis,  or  market value, represents AstaXin(R) manufactured
     and held for sale, as follows:

          Raw materials            $   7,050
          Work-in-process                ---
          Finished goods             983,270
                                   ---------
               Total inventory     $ 990,320
                                   =========

     Inventory has been reduced by $19,463 during the six  months
     ended  June  30,  1999 to reflect the excess  of  cost  over
     market value.

(3)  Stockholders' Equity (Deficit)

     At  June 30, 1999 and 1998, 59,184 shares of authorized  but
     unissued   common  stock  were  reserved  for   issue   upon
     conversion of the Company's outstanding preferred stock.

     As  of  June  30,  1999 approximately 22,000,000  shares  of
     authorized  but  unissued  common stock  were  reserved  for
     exercise  pursuant  to the Company's  1997  and  1986  Stock
     Option Plans.

     As  of  June 30, 1999 and 1998, 200,000 and 280,000  shares,
     respectively, of authorized but unissued common  stock  were
     reserved  for  issuance  for  payment  of  interest  on  the
     variable  rate subordinated debenture and 375,000 shares  of
     authorized  but  unissued  common stock  were  reserved  for
     issuance  upon conversion of the variable rate  subordinated
     debenture.

     As   of  June  30,  1999  and  1998,  13,174,478  shares  of
     authorized but unissued common stock were reserved  for  the
     conversion  of outstanding convertible promissory  notes  in
     the  aggregate amount of $1,082,000 held by directors of the
     Company.

     As  of  June  30, 1999 and 1998, 113,462,178 and 100,964,878
     shares,  respectively,  of authorized  but  unissued  common
     stock   were   reserved  for  the  exercise  of  outstanding
     warrants.

     On  January 25, 1999 the Company issued to certain directors
     and  other  accredited  investors 4,166,667  new  shares  of
     common  stock at $.06 per share, or $250,000, which was  the
     current  market  price of the stock  on  that  date.   These
     investors also committed to purchase an additional 8,333,333
     new shares of common stock at $.06 per share, or $500,000 by
     July  31,  1999.  The total funding to be received  in  this
     transaction  is  $750,000, and a total of 12,500,000  shares
     will  be issued at $.06 per share.  In return for committing
     to  this  funding,  these investors  also  received,  as  of
     January 25, 1999, warrants to purchase 12,500,000 shares  of
     common stock at $.06 per share, expiring in 10 years.

                            -Page 12-

                    IGENE Biotechnology, Inc.
                  Notes to Financial Statements
                           (continued)

(3)  Stockholders' Equity (Deficit) (continued)

     The funds received have been used to continue operations  of
     the  Company and to fund legal expenses associated with  the
     on-going  litigation with  Archer-Daniels Midland, Inc. (See
     note  5).   As  of June 30, 1999, $700,000 of the  committed
     funding  has  been  received from investors  and  11,666,667
     shares have been issued at $.06 per share.

(4)  Net Loss Per Common Share

     Net  loss  per common share for the six-month periods  ended
     June   30,  1999  and  1998  is  based  on  27,751,637   and
     19,636,887, respectively, of weighted average common  shares
     outstanding.  For purposes of computing net loss per  common
     share,  the  amount  of  net  loss  has  been  increased  by
     dividends  declared and cumulative undeclared  dividends  in
     arrears on preferred stock.

(5)  Contingencies and Subsequent Event

     On  July 21, 1997, ADM filed suit against the Company in the
     U.S.  District Court in Baltimore, Maryland alleging  patent
     infringement and requesting a preliminary injunction against
     the Company to cease the  use  of the Company's  astaxanthin
     manufacturing process. On August 24, 1997, the Company filed
     a  $300,450,000  contract  and  trade  secrets  counterclaim
     against  ADM, alleging theft of trade secrets.  The  Company
     is  also  claiming  breach  of contract,  in  regards  to  a
     licensing agreement entered into by the Company and  ADM  in
     1995.   The  Company  contends that  it  complied  with  all
     material terms of this agreement.  On September 10, 1997 the
     District  Court  denied  ADM's  request  for  a  preliminary
     injunction  on  the basis that ADM could not  demonstrate  a
     likelihood   of  success  on  the  merits  of   its   patent
     infringement allegations.  To date, a stay on all  discovery
     has  been  imposed  by  the court, while  a  court-appointed
     expert  analyzed the yeast products of both  parties.   Most
     recently,  and pursuant to an order issued by the  judge  on
     July 16, 1999, both the Company and ADM have communicated to
     the  court their willingness to pursue a mediated settlement
     of  this dispute.  It is management's contention that it  is
     not probable that this dispute will result in an unfavorable
     outcome.   Accordingly, no liability has been  reflected  in
     the accompanying balance sheet.  The Company had expenses of
     $358,494 and $183,698, respectively, in the six months ended
     June 30, 1999 and 1998 relating to this litigation, which is
     on-going.
                            -Page 13-

                    IGENE Biotechnology, Inc.
             Management's Discussion and Analysis of
          Financial Condition and Results of Operations



CAUTIONARY STATEMENT FOR PURPOSES OF "SAFE HARBOR PROVISIONS"  OF
THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995:

EXCEPT  FOR  HISTORICAL  FACTS, ALL  MATTERS  DISCUSSED  IN  THIS
REPORT, WHICH ARE FORWARD LOOKING, INVOLVE A HIGH DEGREE OF RISKS
AND  UNCERTAINTIES.   POTENTIAL RISKS AND UNCERTAINTIES  INCLUDE,
BUT   ARE  NOT  LIMITED  TO,  COMPETITIVE  PRESSURES  FROM  OTHER
COMPANIES AND WITHIN THE BIOTECH INDUSTRY, ECONOMIC CONDITIONS IN
THE  COMPANY'S  PRIMARY MARKETS AND OTHER UNCERTAINTIES  DETAILED
FROM  TIME-TO-TIME  IN  THE  COMPANY'S  SECURITIES  AND  EXCHANGE
COMMISSION FILINGS.


Certain   statements  in  this  report  set  forth   management's
intentions,  plans, beliefs, expectations or predictions  of  the
future  based on current facts and analyses.  Actual results  may
differ materially from those indicated in such statements, due to
a  variety of factors including reduced product demand, increased
competition,  government action, weather  conditions,  and  other
factors.

Results of Operations
                              Sales
During  the  six  months  ended  June 30, 1999, the Company began
large   scale   commercial   trials of  AstaXin(R)  with  several
potential customers in Chile. These trials are expected to result
in  subsequent  and  continuing sales of  AstaXin(R)  to    these
potential customers, during and following the trials,  which  are
expected to last between six months to one  year. However,  there
can be no assurance that  such  sales  will    occur or that they
will be material.  Additional large scale  trails  have also been
started subsequent to June 30, 1999. During the  six months ended
June 30, 1998 the Company  had  $203,860  in sales of AstaXin(R).
This entire amount was  sold to a single distributor.  Subsequent
to June 30, 1998,  and during the six months ended June 30, 1999,
there  were  no sales  of  AstaXin(R),  a  decrease of  $203,860,
since this distributor inventoried this large quantity of product
and has  not yet needed additional product.  The Company  is  now
making substantial marketing efforts on its own behalf  (See also
Marketing  and selling expenses on  page  15  of  this document).

                          Cost of sales
During a successful implementation of certain improvements in the
production  process, which had been developed in the pilot plant,
production was temporarily suspended  during  the  quarter  ended
March 31, 1999.  A resumption of  production during April and May
of 1999 confirmed that the improvements   result   in   increased
efficiency  and  yields  in  the manufacturing  process.  In June
1999, and continuing until the present, production has again been
temporarily suspended   until  sales  volume  warrants additional
production.   The preceding resulted in cost of sales for the six
months  ended   June  30,1999  and 1998 of $119,845 and $605,051,
respectively,  a  decrease  of  $485,206  or  80%.  The   Company
expects to resume production, and  that  production  will achieve
gross profits, as soon as additional sales occur. However,  there
can be no assurance that such gross  profits will  occur or  that
they will be material. The Company expects to incur cost of sales
of  approximately $138,000 per month  when  production   resumes,
which is  expected  to  be  funded  by  product  sales. When, and
if, the  Company  is  producing and selling AstaXin(R) at a gross
profit, management plans to  expand  production  capacity to meet
an  expected  increasing demand for AstaXin(R), which is expected
to  result in  profitable  operations.  However, there can  be no
assurance  that  such  profitable  operations will occur, or that
they will be material.



                            -Page 14-

                    IGENE Biotechnology, Inc.
             Management's Discussion and Analysis of
          Financial Condition and Results of Operations
                           (continued)

Results of Operations (continued)

                   Technology licensing income
Technology licensing income of $2,007 for the  six  months  ended
June  30, 1999  resulted  from  royalties  for  ClandoSan(R), the
Company's  nematicide  soil  treatment  product.    No  royalties
on ClandoSan(R) were earned during the six  months ended June 30,
1998, an increase of $2,007.

                 Marketing and selling expenses
Marketing  expenses   for  AstaXin(R)  have  increased  and   are
expected  to  continue  to  do  so, as the Company continues  and
escalates  its  promotion  of AstaXin(R).  Marketing and  selling
expenses for the six months  ended June 30, 1999  and  1998  were
$52,925 and $689, respectively, an increase of $52,236. Marketing
expenses  for AstaXin(R) had been minimal  prior  to 1999,  since
the  Company's  contract  manufacturer   had  been acting as non-
exclusive  distributor  and  marketer  of AstaXin(R) during 1998.
These increasing expenses are expected  to  be  funded by product
sales.  However, there can be no assurance   that such sales will
occur, or that they will be material.

         Research, development and pilot plant expenses
Research, development and  pilot plant expenses are  expected  to
continue at approximately $30,000 per month which will be used to
increase  the  efficiency  of  the  manufacturing process through
experimentation  in  the  pilot  plant,  development  of   higher
yielding strains of yeast and other improvements in the Company's
AstaXin(R) technology.  However, there can be no  assurance  that
such improvements in efficiency  and  yield  will  occur, or that
they will be material.  These  expenses are expected to be funded
by sales.  However, there  can  be  no  assurance that such sales
will occur, or that they  will be material. Research, development
and pilot plant expenses for the six  months ended June 30,  1999
and  1998  were  $190,400  and $223,685, respectively, a decrease
of  $33,285,  or  15%.  Analytical  testing  and  field  studies,
relating  to the  start of manufacture of AstaXin(R) during 1998,
did  not  recur  in  the  six  months  ended June 30, 1999.  This
resulted   in  a  decrease  in research, development  and   pilot
plant  expenses  for  the  six  months  ended  June  30, 1999  as
compared to  the six month period ended June 30, 1998.

               General and administrative expenses
General and administrative expenses  have  decreased,   primarily
due  to  the  Company's  operating   without   a  designated  CEO
since  mid-1998  (the Company's Board of  Directors  as  a  group
presently  performs  the   functions  of     CEO).   General  and
administrative expenses  for  the  six   months  ended  June  30,
1999  and  1998  were  $173,720  and  $316,548,  respectively,  a
decrease of $142,828, or 45%. General and administrative expenses
are  expected  to continue  at approximately $30,000 per month in
the near term, and are  expected  to be funded by sales. However,
there  can  be  no  assurance that such sales will occur, or that
they  will  be  material.

                       Litigation expenses
Management   expects   to  recover  these   litigation  expenses,
associated  with the suit filed against the Company  by  ADM  and
the   Company's   counterclaim,   through   damage   awards   and
preservation  of  the commercial product  rights  associated with
AstaXin(R).  However, there can be no assurance that  the Company
will receive damage awards or that its rights will be  preserved.
Litigation expenses for the six months ended June  30,  1999  and
1998 were $358,494  and  $183,698,  an  increase  of $174,796, or
95%.  These expenses are expected  to continue, in the near term,
at  levels  based   on    management's  continual  re-assessments
of  the   potential benefits of its litigation efforts.  They are
expected  to  be  funded  by  additional capital contributions or
loans from the Company's  directors and other investors.  At  the
present time, a range of reasonably  possible  losses  from  this
litigation cannot be estimated (See also Note 5 to  the financial
statements on page 13 of this document).

                            -Page 15-

                    IGENE Biotechnology, Inc.
             Management's Discussion and Analysis of
          Financial Condition and Results of Operations
                           (continued)

Results of Operations (continued)

            Interest expense, net of interest income
Interest  expense,  net  of  interest income, for the six  months
ended  June  30,  1999  and  1998   was  $343,706  and  $211,194,
respectively, an increase of  $132,512,  or  63%.   This increase
results  from  $5,000,000  in  notes  issued  during  1998 in the
Company's right's offering.  It is expected that the note holders
will use these notes to exercise  outstanding  warrants issued to
the note holders, when and if  the  Company  achieves  profitable
operations.   However,  there  can  be  no  assurance  that  such
profitable operations will  occur, or that they will be material,
or that the note-holders  will exercise these warrants.

                            Net loss
As a result  of  the foregoing, the Company  reported  net losses
of  $1,235,916  and  $1,340,470,  or $0.04 and $0.07  per  share,
respectively, for the six months ended June 30,  1999  and  1998.
The weighted average number of shares of common stock outstanding
increased to 30,132,254 for the six months ended  June  30,  1999
from 19,636,887 for  the  six  months  ended June 30, 1998.  This
increase of 10,495,367 weighted average  shares  is caused by the
issuance of 80,000 shares of common  stock  in  lieu  of interest
payments  on  the  variable  rate  subordinated   debenture,  the
conversion of  187,500 shares  of  preferred  stock  into 375,000
shares of common  stock,  the issuance of 866,667 shares of stock
in payment of  legal  fees  and  retainers,  and  the issuance of
11,666,667  shares  to  directors and other investors for cash at
$.06 per share, or $700,000, during the twelve month period ended
June 30, 1999  (See  also  note 3 to the  financial statements on
page 12 of this document).

Financial Position

During the six months ended June 30, 1999 and 1998  the following
materially  affected  the  Company's   financial position:

The  Company   began   producing  AstaXin(R)   in  January  1998,
capitalizing inventory of $990,320 and $216,156,  respectively as
of June 30, 1999 and 1998.

The  Company  had sales of $203,675 during May and  June of 1998,
which are included in accounts receivable as of  June   30, 1998.

The  Company paid expense advances and retainers of $330,000  and
$335,000, respectively to its attorneys during the  six    months
ended  June  30,  1999 and  1998,  which  have  been  capitalized
and  are  included  in  prepaid  expenses as of June 30, 1999 and
1998; as reduced by fees billed, and which  will   be  drawn down
against  future costs associated with on-going litigation against
ADM.

During  the  six  months  ended  June 30, 1999 the Company issued
11,666,667  new  shares  of  common  stock to directors and other
investors at $.06 per share, or $700,000.

The  Company issued, on March 31, 1998,  $5,000,000 of  long-term
notes payable pursuant to  its rights  offering  of  February 13,
1998.  The notes mature on March 31, 2003  with interest  payable
at 8% payable either  annually  or  at maturity, at the Company's
option. The Company also  issued warrants  to purchase 50,000,000
shares of common  stock at $0.10  per  share  expiring  March 31,
2008.  Short-term promissory notes of $1,875,000 and demand notes
of $475,000  were  repaid  through  exercise  of  rights  in this
offering,  and   $211,712  of   related  debt  issue  costs  were
capitalized.

                          -Page 16-

                    IGENE Biotechnology, Inc.
             Management's Discussion and Analysis of
          Financial Condition and Results of Operations
                           (continued)

Financial Position (continued)

During  the  six  months ended June 30,  1998, the Company issued
$950,000  in  demand  notes  to  certain  directors, $475,000  of
which were repaid pursuant to the issuance  of   new  debt in the
rights offering, and $475,000 of which were repaid in cash.

During  the  six months ended June 30, 1999 and 1998, the Company
purchased  $28,407  and $59,052,  respectively,  in  research and
development and manufacturing equipment.

During the six  months ended June 30, 1999 and  1998  the Company
received   principal   repayments   of  $44,003   and   $121,508,
respectively   on   its   loan   receivable   from   its contract
manufacturer,  which financed  the  manufacturer's   purchase  of
$500,000 of manufacturing equipment  from  the  Company, at cost.

In  December  of  1988,  the  Company  suspended payment  of  the
quarterly  dividend on its preferred stock.   Resumption  of  the
dividend  will  require  significant improvement  in  cash  flow.
Unpaid  dividends cumulate  for  future  payment  or increase the
liquidation  preference  or  redemption  value  of  the preferred
stock.  As of June 30, 1999 and 1998, total dividends  in arrears
on  the  Company's  preferred  stock  was  $203,593  and  $1,354,
respectively, of which $203,592  ($6.88   per share) and $184,654
($6.24 per share), respectively,   was included  in  the carrying
value  of  the  redeemable  preferred  stock and $-0- and $1,170,
respectively, was included in the  liquidation  preference of the
limited redemption  preferred  stock.   A  reduction in dividends
in arrears resulted  from the  conversion,  in September 1998, of
187,500   shares  of  limited  redemption  preferred  stock  into
375,000  shares  of  common stock.

Liquidity and Capital Resources

Historically, the Company has been  funded  primarily  by  equity
contributions and loans from  stockholders.   As  of    June  30,
1999 and 1998, the Company had working capital  of $1,260,751 and
$1,895,423, respectively.  Working capital decreased  by $634,672
during the twelve month period  ended June 30, 1999.  The Company
had cash and cash equivalents of  $63,185  and  $1,414,683  as of
June  30,  1999  and  1998, respectively. In order to continue to
fund operations in the near  term,  until  profitable  operations
occur, the Company  plans  to  obtain  additional  capitalization
from directors and other investors.

Cash  used  by operations in the six months ended  June  30, 1999
and  1998  amounted  to  $1,089,091 and $1,618,958, respectively.
This decrease in cash used in operations  of  $529,867   resulted
from  reductions   in   research   and   development  and general
and administrative expenses  and a temporary  halt  in production
of AstaXin(R)  during  the  six months ended June 30, 1999.

Cash  provided  by investing activities for the six  months ended
June  30,  1999  and  1998 amounted  to  $21,781  and    $66,961,
respectively.  The decrease  of  $45,180  in  cash    provided by
investing activities resulted primarily  from  a decrease in  the
amount of principal  repayments  on  loan   receivable during the
six months ended June 30, 1999. These repayments by the Company's
contract  manufacturer were suspended  during  the temporary halt
in production which occurred during the six months ended June 30,
1999.

Cash  provided  by financing activities for the  six months ended
June  30,  1999  and 1998 amounted  to  $765,699  and  $2,942,132
respectively, a decrease of $2,176,433, resulting primarily  from
net  proceeds  from  the rights offering of $2,438,288 during the
six months ended June  30, 1998.

                            -Page 17-

                    IGENE Biotechnology, Inc.
                             PART II
                        OTHER INFORMATION

Item 1.  Legal Proceedings

On  July 21, 1997, ADM filed suit against the Company in the U.S.
District   Court   in   Baltimore,   Maryland   alleging   patent
infringement and requesting a preliminary injunction against  the
Company  to  cease  the   use   of   the  Company's   astaxanthin
manufacturing process.  On August 24, 1997, the Company filed   a
$300,450,000 contract and trade secrets counterclaim against ADM,
alleging theft of trade secrets.  The Company  is  also  claiming
breach of contract, in regards  to  a licensing agreement entered
into by the Company and ADM in 1995.  The  Company  contends that
it  complied   with  all   material  terms  of  this   agreement.
On September 10, 1997 the District  Court  denied  ADM's  request
for  a  preliminary injunction  on  the basis  that ADM could not
demonstrate  a likelihood  of  success  on  the  merits  of   its
patent infringement allegations. To date, a stay on all discovery
has  been  imposed  by  the court, while a court-appointed expert
analyzed the yeast products of both  parties.   Most    recently,
and pursuant to an order issued by the  judge  on  July 16, 1999,
both the Company and ADM have communicated to    the  court their
willingness to pursue a mediated settlement of  this dispute.  It
is  management's  contention  that  it  is not probable that this
dispute will result in an unfavorable  outcome.   Accordingly, no
liability has been  reflected  in the accompanying balance sheet.
The Company had expenses of $358,494 and $183,698,  respectively,
in the six months ended  June 30, 1999 and 1998  relating to this
litigation, which is  on-going.

Item 2.  Changes in Securities and Use of Proceeds.

Dividends on Common Stock are currently prohibited because of the
preferential rights of holders of Preferred Stock.The Company has
paid no cash dividends on its Common Stock in the past  and  does
not intend to declare or pay any dividends on its Common stock in
the foreseeable future.

With  respect  to  sales  of  securities not registered under the
Securities  Act,  see Note 3 to the financial statements, at page
12 of this report.

Item 3.  Defaults Upon Senior Securities.

     None

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

     None

Item 5.  Other Information

Pursuant  to an order issued by the judge on July 16, 1999, both
the  Company  and  ADM  have  communicated  to  the  court their
willingness  to  pursue  a  mediated  settlement  of the dispute
underlying  ADM's  suit  against  the  Company and the Company's
counterclaim.

Item 6.  Exhibits and Reports on Form 8-K

     (a)  Exhibits

          27.  Financial Data Schedule

     (b)  Reports on Form 8K - None




                           -Page 18-

                           SIGNATURES

In accordance with the requirements of the Exchange  Act, the
registrant caused this report to be signed on its  behalf  by
the undersigned, thereunto duly authorized.



                          IGENE Biotechnology, Inc.
                          (Registrant)



Date July 30, 1999        /s/Stephen F. Hiu
                          ___________________________________
                          Stephen F. Hiu
                          President and Treasurer
                          (On behalf of the Registrant and as
                          Principal Financial Officer)




                            -Page 19-