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


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

          For the quarterly period ended March 31, 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:
31,094,207 as of May 1, 1999.

Transitional 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

          Statement 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
          Condition and Results of Operations                  14-16

PART II   -    OTHER INFORMATION                                  17

SIGNATURES                                                        18

                              -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-

                      IGENE Biotechnology, Inc.
                           Balance Sheets

<TABLE>

<CAPTION>                   
                                            March 31,     March 31,  December 31,
                                                1999          1998          1998
                                          -----------   -----------  ------------
                                          (Unaudited)   (Unaudited)

<S>                                       <C>           <C>          <C>
ASSETS
CURRENT ASSETS
  Cash and cash equivalents               $    68,989   $    59,896  $    364,796
  Accounts receivable                           6,887        14,494           ---
  Inventory                                   870,260       192,522       870,260
  Supplies                                     11,145         4,710        11,145
  Prepaid expenses                            211,255       201,321        83,933
  Due from stockholders                           ---     2,615,000           ---
  Loan receivable                             250,783       255,500       250,783
                                          -----------   -----------  ------------
     TOTAL CURRENT ASSETS                   1,419,319     3,343,443     1,580,917

OTHER ASSETS
  Property and equipment, net                 358,386       287,847       370,057
  Loan receivable, net of current portion         ---       184,003           ---
  Debt issue costs                            169,370       285,000       179,956
  Security deposits                            10,600        10,600        10,600
                                          -----------   -----------  ------------
     TOTAL ASSETS                         $ 1,957,675   $ 4,110,893   $ 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>
                                                March 31,     March 31,  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       $   141,507   $   686,495   $   228,549
  Debenture interest payable                       90,000        90,000        45,000
  Demand notes payable                                ---       475,000           ---
  Promissory notes payable                            ---           ---           ---
                                              -----------   -----------  ------------
     TOTAL CURRENT LIABILITIES                    231,507     1,251,495       273,549

LONG-TERM DEBT
  Promissory notes payable                      6,092,500     6,082,500     6,092,500
  Variable rate subordinated debenture          1,500,000     1,500,000     1,500,000
  Accrued interest                                486,600           ---       364,950
                                              -----------   -----------  ------------
     TOTAL LIABILITIES                          8,310,607     8,833,995     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 $14.72, $14.08,
     and $14.56, respectively. Authorized
     1,312,500 shares, issued 29,592 shares       435,594       416,655       430,860
                                              -----------   -----------  ------------
STOCKHOLDERS' DEFICIT
  Preferred stock, $.01 par value per share,
     8% cumulative, convertible, voting,
     series A.  Authorized, issued and
     outstanding 187,500 shares
     (aggregate Involuntary liquidation
     value of $2,640,000 at March 31, 1998.           ---         1,875           ---
  Common stock, $.01 par value per share.
     Authorized, 250,000,000 shares; issued
     and outstanding 26,887,540, 19,211,473,
     and 21,854,173 shares, respectively.         268,875       192,115       218,542
  Additional paid-in capital                   18,982,720    18,434,775    18,738,038
  Deficit                                     (26,040,121)  (23,768,522)  (25,476,909)
                                              -----------   -----------   ----------- 
     TOTAL STOCKHOLDERS' DEFICIT               (6,788,526)   (5,139,757)   (6,520,329)
                                              -----------   -----------   -----------
     TOTAL LIABILITIES AND
       STOCKHOLDERS'  DEFICIT                 $ 1,957,675   $ 4,110,893   $ 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
                                               -------------------------
                                                March 31,      March 31,
                                                    1999           1998
                                               ----------     ----------
<S>                                            <C>            <C>      
Sales                                          $     ---      $     ---
Cost of sales                                     20,436        298,799
                                               ----------     ----------
  Gross profit (loss)                            (20,436)      (298,799)
                                               ----------     ----------
Technology licensing income                        1,167            ---
                                               ----------     ----------
  Net revenue                                    (19,269)      (298,799)
                                               ==========     ==========
Operating expenses:

  Marketing and selling                            6,450            389
  Research, development and pilot plant          100,298        133,202
  General and administrative                      90,811        135,700
  Litigation expenses                            175,737        160,962
                                               ----------     ----------
     Total operating expenses                    373,296        430,253
                                               ----------     ----------
     Operating loss                             (392,565)      (729,052)
                                               ----------     ----------
Other income (expense)

  Interest expense (net of interest income
     of $6,672 and $11,503)                     (170,647)       (62,255)
                                               ----------     ---------- 
     Net loss                                  $(563,212)     $(791,307)
                                               ==========     ==========
     Net loss per common share                 $   (0.02)     $   (0.04)
                                               ==========     ==========
</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                ---        4,735             ---        ---

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

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

Net loss for quarter ended
  March 31 1998                                ---          ---             ---        ---
                                         ---------    ---------       ---------  --------- 
Balance at March, 1998                      29,592    $ 416,655         187,500  $   1,875
                                         =========    =========       =========  =========

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

Cumulative undeclared dividends
  on redeemable preferred stock                ---        4,734             ---        ---

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 quarter ended
  March 31, 1999                               ---          ---             ---        ---
                                         ---------    ---------       ---------  ---------
Balance at March 31, 1999                   29,592    $ 435,594             ---  $     ---
                                         =========    =========       =========  =========
</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>

                                             Common Stock         Additional                  Total
                                        -----------------------   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                ---          ---        (4,735)          ---         (4,735)

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

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

Net loss for quarter ended
  March 31, 1998                               ---          ---           ---      (791,307)      (791,307)
                                        ----------    ---------   -----------  -------------  -------------
Balance at March 31, 1998               19,211,473    $ 192,115   $18,434,775  $(23,768,522)  $ (5,139,757)
                                        ==========    =========   ===========  =============  =============

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                ---          ---        (4,734)          ---         (4,734)

Issuance of common stock in lieu of
  cash in payment of legal fees            866,667        8,666        41,083           ---         49,749

Issuance of shares of common stock
  pursuant to direct purchase of shares
  by certain directors and other
  accredited investors (note 3)          4,166,700       41,667       208,333           ---        250,000

Net loss for quarter ended
  March 31, 1999                               ---          ---           ---      (563,212)      (563,212)
                                        ----------    ---------   -----------  -------------  -------------
Balance at March 31, 1999               26,887,540    $ 268,875   $18,982,720  $(26,040,121)  $ (6,788,526)
                                        ==========    =========   ===========  =============  =============
</TABLE>

The accompanying notes are an integral part of the financial
statements.
                                
                             -Page 9-
<TABLE>
                    IGENE Biotechnology, Inc.
                    Statements of Cash Flows
                           (Unaudited)

<CAPTION>
                                                                        Three months ended
                                                                   ---------------------------
                                                                     March 31,       March 31,
                                                                         1999            1998
                                                                   -----------       ---------
<S>                                                                <C>             <C>
Cash flows from operating activities:
   Net loss                                                        $ (563,212)     $ (791,307)
   Adjustments to reconcile net loss to net cash provided
     by operating activities:
     Depreciation                                                      14,247           9,503
     Amortization                                                      10,586             ---
     Interest on debenture paid in shares of common stock              45,000          45,000
     Decrease (increase) in:
       Accounts receivable                                             (6,887)            ---
       Inventory                                                          ---        (192,522)
       Prepaid expenses and other current assets                      (97,574)       (201,321)
     Increase (decrease) in:
       Accounts payable and accrued expenses                           54,609         126,998
                                                                   -----------     -----------
       Net cash used in operating activities                         (543,231)     (1,003,649)
                                                                   -----------     -----------
Cash flows from investing activities:
   Proceeds from disposal of equipment                                    460             ---
   Capital expenditures                                                (3,036)           (344)
                                                                   -----------     -----------
       Net cash provided by investing activities                       (2,576)           (344)
                                                                   -----------     -----------
Cash flows from financing activities:
   Advances to stockholders                                               ---          28,594
   Proceeds from issuance of common stock                             250,000             250
   Issuance of demand notes                                               ---         950,000
   Repayment of demand notes                                              ---          60,497
                                                                   -----------     -----------
       Net cash provided by financing activities                      250,000       1,039,341
                                                                   -----------     -----------
       Net increase (decrease) in cash and cash equivalents          (295,807)         35,348

       Cash and cash equivalents at beginning of period               364,796          24,548
                                                                   -----------     -----------
                                                                   $   68,989      $   59,896
                                                                   ===========     ===========
Supplementary disclosure and cash flow information:
   Cash paid during the period for interest                        $       84      $       26
   Cash paid during the period for income taxes                           ---             ---

</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  three  months ended March 31,  1999  and  1998,  the
Company  recorded dividends in arrears on 8% redeemable preferred
stock  at  $.16 per share aggregating $4,735 in each year,  which
has  been  removed  from  paid-in capital  and  included  in  the
carrying value of the redeemable preferred stock.

During  the three months ended March 31, 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.  Net proceeds due  from  the
transfer  agent  and shareholders of $2,615,000, which  is  after
transfer  agent fees of $35,000, are included as a receivable  at
March  31, 1998 and were received in April 1998.  Transfer  agent
fees  of  $35,000  and  legal fees of $250,000  which  have  been
accrued  as of March 31, 1998, have been capitalized as  deferred
debt issue costs.

During  the  three  months  ended March  31,  1998,  the  Company
cancelled  certain promissory notes and the related  amounts  due
from stockholders of $125,000 by agreement with the stockholder.

During  the  three  months  ended March  31,  1999,  the  Company
satisfied  accounts  payable of $20,000 and  advances  for  legal
retainers of $29,749 by issuing 866,667 shares of common stock to
counsel in its 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  March  31,
     1999 and 1998 and for the three 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  operations.  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 of March 31, 1999 as follows:
     
          Raw materials            $         ---
          Work-in-process                    ---
          Finished goods                 870,260
     
               Total inventory     $     870,260

(3)  Stockholders' Equity (Deficit)

     At  March  31,  1998 and 1997,  59,184 and  434,104  shares,
     respectively, of authorized but unissued common  stock  were
     reserved   for  issue  upon  conversion  of  the   Company's
     outstanding preferred stock.
     
     As  of  March  31,  1998  and  1999,  21,410,166  shares  of
     authorized  but  unissued  common stock  were  reserved  for
     exercise of options pursuant to the Company's 1997 and  1986
     Stock Option Plans.

     As  of  March 31, 1999 and 1998, 320,000 and 400,000 shares,
     respectively, of authorized but unissued common  stock  were
     reserved for issuance upon reinvestment 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  March  31  1999 and 1998, 13,174,477 and  12,876,082
     shares, respectively, of common stock were reserved for  the
     conversion of outstanding convertible promissory notes  held
     by directors of the Company.
     
     As  of  March 31, 1999 and 1998, 113,462,177 and  87,464,878
     shares,  respectively,  of authorized  but  unissued  common
     stock   were   reserved  for  the  exercise  of  outstanding
     warrants.
     
     On  January 25, 1998 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.   These  directors  and
     investors  have also purchased, for an additional  $250,000,
     on  April 25, 1999, 4,166,667 additional shares at $.06  per
     share.   They  have also committed to purchase  $250,000  of
     common stock on July 25, 1999 at $.06 per share.  The  total
     of  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 warrants to purchase common stock at
     $.06  per  share, expiring in 10 years.  The funds  will  be
     used   to  continue  operations  of  the  Company  and  fund
     projected  legal  expenses  associated  with  the   on-going
     litigation with Archer-Daniels Midland, Inc. (ADM).
     
     
                            -Page 12-

                    IGENE Biotechnology, Inc.
                  Notes to Financial Statements
                           (Continued)
     
(4)  Net loss per common share

     Net  loss per common share for the three-month periods ended
     March  31,  1999  and  1998  is  based  on  25,322,345   and
     19,210,417,  weighted  average  shares,  respectively.   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

     In  May  1995, the Company signed a non-exclusive  licensing
     agreement  with   ADM   for  the  manufacture  and  sale  of
     AstaXin(R).   On  February 29, 1996 ADM informed the Company
     that  it  had  decided  not  to  utilize  the Technology and
     requested that the Company  return approximately $250,000 in
     payments  under   the  licensing  agreement.   The   Company
     maintains  that  ADM  is  not  entitled  to  the  return  of
     payments  and  that   additional   monies  are owed  to  the
     Company.  On  July  21, 1997, ADM  filed  suit  against  the
     Company in the U.S.  District  Court  in Greenbelt, Maryland
     alleging patent infringement  and  requesting  a preliminary
     injunction  against  the  Company  to  cease  the use of its
     astaxanthin  manufacturing  process.   On  August  4,  1997,
     the Company filed a $300,450,000 contract and trade  secrets
     lawsuit  in  U.S.  District  Court  in  Baltimore,  Maryland
     against ADM, alleging  theft  of  trade secrets. The Company
     is  also  claiming  breach  of  contract, in  regards to the
     licensing  agreement entered into  by  the Company  and  ADM
     in 1995.  The Company  contends  that  it complied  with all
     material terms of this  agreement.  The Company's  claim was
     re-asserted as a counter-claim against ADM and the two cases
     were joined in the District Court in Baltimore,  Maryland on 
     August 24, 1997.  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 case. During 1998 and until this report
     date, a  stay  has been  imposed on both the Company and ADM
     by  the  court  while  a court-appointed expert analyzes the
     yeast  products   of   both  parties.  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 $175,737  and $160,962,
     respectively, in the quarters  ended March 31, 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

During  the  quarters ended march 31, 1999 and 1998, the  Company
had no sales of AstaXin(R). During 1998, the Company had $203,860
of  sales  of  AstaXin(R). The Company is  presently  engaged  in
discussions  with  many potential purchasers  of  AstaXin(R), and
expects to achieve additional sales in the near future.  However,
there can be no assurance that any such sales will occur or  that
they will be material.

During  the quarter ended March 31, 1999, the Company implemented
certain  improvements in the production  process  for AstaXin(R).
During this period, no additional product was produced.  Cost  of
sales  of  $20,436 represent indirect production costs  incurred.
Cost  of  sales  decreased $278,363, or 93% due to  the  halt  in
production  during the quarter ended March 31, 1999.   Production
was  resumed  in April for one month to test the improvements  in
production, but has since been stopped again.  Production will be
resumed  on  an  as-needed  basis to meet  inventory  needs  from
potential  product  sales.   Such  future  production  costs  are
expected  to  be  funded  by sales.  However,  there  can  be  no
assurance  that  such  sales will occur  or  that  they  will  be
material.

During  the  quarter  ended March 31,  1998,  the  Company  began
commercial  production  of  AstaXin(R), its  astaxanthin  pigment
product.  The Company produces the product through the use  of  a
contract  manufacturer in Mexico, Fermic, S.A. de C.V.  (Fermic).
Direct  and indirect production costs totaled $491,321, of  which
$192,522  was  capitalized as inventory, stated at the  lower  of
cost  or  market basis.  The remaining $298,799 has been expensed
as  cost of goods sold.  Initial production runs were inefficient
as  to  production time and product waste.  These  inefficiencies
have  since  been  corrected,  and  are  expected  to  result  in
production  costs on a potentially profitable basis in  the  near
future.   However, there can be no assurance that such profitable
operations will occur or that they will be material.

Technology licensing income for the quarter ended March 31,  1999
resulted   from   royalties   for   ClandoSan(R),  the  Company's
nematacide soil  treatment product.  No royalties on ClandoSan(R)
were  earned during the quarter ended March 31, 1998.

Marketing  and selling costs of $6,450 and $389 for  the  quarter
ended March 31, 1999 and 1998, which is an increase of $6,062  or
1,559%, represent marketing efforts for AstaXin(R).  These  costs
are  expected  to  increase in the near  future  as  the  Company
implements its marketing program for AstaXin(R). These costs  are
expected  to  be  funded  by sales.  However,  there  can  be  no
assurance  that  such  sales 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)

Research  and development and pilot plant expenses were  $100,298
and  $133,202, respectively for the quarters ended March 31, 1999
and  1998, a decrease of $32,904 or 25%.  This decrease is caused
by  additional field studies and analytical testing of AstaXin(R)
during  1998.   These  costs are expected to continue  at  levels
similar  to  the  quarter ended March 31,  1999  as  the  Company
continues research relating to improving production of AstaXin(R)
and  research  and development of other future  products.   These
costs are expected to be funded by sales.  However, there can  be
no  assurance  that such sales will occur, or that they  will  be
material.

General  and administrative expenses for the quarter ended  March
31,  1999  decreased  $44,889  or 33%.   This  savings  primarily
results  from  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  are  expected  to  continue  at  levels
similar to the quarter ended March 31, 1999, 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 of $175,737 and $160,962 during the  quarters
ended  March  31, 1999 and 1998 represent the Company's  expenses
associated  with  its  defense of  the  suit  by  Archer  Daniels
Midland,  Inc. (ADM) and the Company's counter-suit.   Management
expects  to  recover  legal expenses 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.
The  Company  estimates  that the cost of  this  litigation  will
continue  based  on  management's continuing assessments  of  the
potential  costs  and benefits of its litigation  strategies  and
alternatives.   These  expenses are  expected  to  be  funded  by
additional  funding from directors and other investors.   At  the
present  time,  a  range of reasonably possible  loss  from  this
litigation cannot be estimated.

Net  interest expense was $170,647 and $62,255,  respectively for
the  quarters  ended  March 31, 1999 and  1998,  an  increase  of
$108,392  or 174%.  This increase is the result of the  Company's
additional  financing from notes from stockholders  in  1997  and
debt  issued in its rights offering during 1998.  It is  expected
that note holders will convert convertible debt into common stock
and that the Company will pay off other debt, or that it will  be
used  to  exercise outstanding warrants, when and if the  company
achieves  profitable  operations.   However,  there  can  be   no
assurance  that  such  sales will occur, or  that  they  will  be
material.

As  a result of the foregoing the Company reported net losses  of
$563,212 and $791,307, respectively, for the quarters ended March
31,  1999 and 1998, which is a decreased loss of $228,095 or 27%.
This  is  a  loss of $0.02 and $0.04 per share, respectively,  in
1999  and 1998.  The weighted average number of shares of  common
stock outstanding of 25,322,345 and 19,210,417, respectively, for
the  quarter  ended  March 31, 1999 and  1998  has  increased  by
6,111,928  shares.   This resulted from the  issuance  of  80,000
shares   in  1998  in  payment  of  interest  on  a  subordinated
debenture,  the  conversion of 187,500 shares of preferred  stock
into  375,000  shares of common stock in payment  of  legal  fees
during 1998 and 1999, and the issue of 4,166,700 shares of common
stock  to  directors and other accredited investors for  cash  at
$.06 per share, or $250,000, in the quarter ended March 31, 1999.

Financial Position
     
During  the quarters ended March 31, 1999 and 1998 the  following
materially affected the Company's financial position:
     
The Company  began production of AstaXin(R) in January  of  1998,
capitalizing  inventory  of  $192,522  as  of  March  31,   1998.
Inventory increased $677,738 to $870,260 as of March 31, 1999.
     
                            -Page 15-

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

Financial Position (continued)

The  Company paid an advance of $200,000 to its attorneys  during
the  quarter ended March 31, 1998, which was later drawn  against
costs  of  on-going  litigation.  This  amount  was  included  in
prepaid  expenses  as  of  March  31,  1998.   Such  advances  to
litigation counsel amounted to $182,647 as of March 31, 1999.

The Company was due $2,615,000, which is included as a receivable
as  of  March  31,  1998,  from its transfer  agent  and  certain
stockholders  representing  the net  proceeds  of  the  Company's
Rights  Offering of February 13, 1998, which closed on March  31,
1998.  All amounts due were received in April 1998.   The Company
issued  long-term  promissory notes aggregating $5,000,000  which
mature  March 31, 2003 and warrants to purchase 50,000,000 shares
of  common  stock at $0.10 per share expiring March 31,  2008  in
association  with the Rights Offering.  $2,000,000 of  short-term
promissory notes and $475,000 of demand notes were repaid through
exercise  of  Rights in this offering, and $285,000  of  deferred
debt issuance were capitalized.

During  the  quarter  ended March 31,  1998  the  Company  issued
$950,000 in demand notes to certain directors.

In  December 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
March  31  1999  and  1998, total dividends  in  arrears  on  the
Company's   preferred   stock  was   $198,858   and   $1,319,919,
respectively,  of which $198,858 ($6.72 per share)  and  $179,919
($6.08  per  share), respectively, was included in  the  carrying
value  of the redeemable preferred stock and $-0- and $1,140,000,
respectively,  was  included  in the  liquidation  preference  of
preferred stock.  This reduction of dividends in arrears  results
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 March 31, 1999
and  1998  the  Company  had working capital  of  $1,187,812  and
$2,091,948,   respectively.    Working   capital   increased   by
$4,205,522 during the quarter ended March 31, 1998 due  primarily
to  net proceeds receivable from the Company's Rights Offering of
$2,365,000 and the restructuring of $2,000,000 in short-term debt
to  long-term maturity through the Rights Offering.  The  Company
had   cash   and  cash  equivalents  of  $68,989  and    $59,896,
respectively, as of March 31, 1999 and 1998.

Cash used by operations in the quarters ended March 31, 1999  and
1998  amounted  to  $543,231 and $1,003,649, respectively.    The
decrease  of  $460,418  results  primarily  from  the   halt   in
production during the quarter ended March 31, 1999.

Cash  used  by investing activities for the quarters ended  March
31,  1999 and 1998 amounted to $2,576 and $334, respectively,  an
increase  of  $2,232, representing a slight increase  in  capital
expenditures.

Cash  provided  by  financing activities for the  quarters  ended
March  31,  1999  and 1998 amounted to $250,000  and  $1,039,341,
respectively,  a  decrease of $789,341 resulting  primarily  from
loans  from stockholders during the quarter ended March 31,  1998
of  $950,000,  and proceeds of $250,000 from issuance  of  common
stock  to directors and other accredited investors in the quarter
ended March 31, 1999.




                            -Page 16-

                    IGENE Biotechnology, Inc.
                             PART II
                        OTHER INFORMATION
                                
Item 1.   Legal Proceedings.

In  May  1995,  the  Company  signed  a  non-exclusive  licensing
agreement  with  Archer  Daniels Midland Company  (ADM)  for  the
manufacture and sale  of AstaXin(R).  On February  29,  1996  ADM
informed  the  Company that it had decided  not  to  utilize  the
technology  and  requested that the Company return  approximately
$250,000  in  payments made to the Company  under  the  licensing
agreement.  The Company maintains that ADM is not entitled to the
return  of  payments and that additional monies are owed  to  the
Company.  On July 21, 1997, ADM filed suit against IGENE  in  the
U.S.  District  Court  in  Greenbelt,  Maryland  alleging  patent
infringement and requesting a preliminary injunction against  the
Company  to  cease  the  use  of  its  astaxanthin  manufacturing
process.   On  August 4, 1997, the Company filed  a  $300,450,000
contract  and  trade secrets lawsuit in U.S.  District  Court  in
Baltimore, Maryland against ADM, alleging theft of trade secrets.
The  Company is also claiming breach of contract, in  regards  to
the  licensing agreement entered into by the Company and  ADM  in
1995.   The  Company contends that it complied with all  material
terms of this agreement.  The Company's claim was re-asserted  as
a  counter-claim against ADM and the two cases were joined in the
District  Court in Baltimore, Maryland on August  24,  1997.   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  case.
During  1998,  and  until the date of this  report,  a  stay  was
imposed by the court while a court-appointed expert analyzes both
parties' yeast products.  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.

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
tock 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

None.

Item 6.   Exhibits and Reports on Form 8-K

(a)  Exhibits
  
       27.  Financial Data Schedule

(b)  Reports on Form 8-K
     
     None
                           -Page 17-
     
                           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 May 14, 1999        By   /s/Stephen F. Hiu
                              Stephen F. Hiu
                              President and Treasurer
                              (On behalf of the Registrant and as
                              Principal Financial Officer)
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
                                
                                
                                
                            -Page 18-