[TYPE]  10-QSB
[TEXT]

            U.S. SECURITIES AND EXCHANGE COMMISSION
                    Washington, D.C.  20549

                          FORM 10-QSB

[X]  Quarterly Report Under Section 13 or 15(d) of the Securities
Exchange Act of 1934
    For the quarterly period ended June 30, 1999

Commission File Number 33-6859-D

                        ZEON Corporation
     (Exact name of registrant as specified in its charter)


        Colorado                                 84-0827610
(State or other jurisdiction of              (I.R.S. Employer
 incorporation or organization)            Identification Number)

 1500 Cherry Street           Louisville, CO      80027
(Address of principal executive offices)      (Zip Code)

        (303) 666-9400
(Registrant's telephone number including area code)


(Former  name, former address and former fiscal year  if  changed
since last reported)


Check  whether  the issuer (1) filed all reports required  to  be
filed  by Section 12, 13 or 15(d) of the Securities Exchange  Act
of  1934  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.

                                   [X] Yes      [ ] No

Number of shares of Common Stock Outstanding at June 30, 1999

          Common Stock, No Par Value             348,597
                    (Class)               (Number of Shares)

Transitional Small Business Disclosure Format (check one):
[ ]Yes      [X] No




<PAGE>


                        ZEON Corporation
                             INDEX



                                                            Page

Part I - Financial Information

Balance Sheet June 30, 1999 and December 31, 1998             3

Statement of Operations - Three Months Ended
          June 30, 1999 and 1998                              5

Statement of Operations - Six Months Ended
          June 30, 1999 and 1998                              6

Statements of Cash Flows - Six Months Ended
          June 30, 1999 and 1998                              7

Notes to Financial Statements                                 8

Management's Discussion and Analysis of Financial
     Condition and Results of Operations                     11
Part II - Other Information                                  13

Signature Page                                               14

<PAGE>
<TABLE>


                             ZEON Corporation
                              BALANCE SHEETS
<CAPTION>
                                        June 30, 1999     Dec. 31,1998
                                        (unaudited)
  <S>                                    <C>                <C>
  CURRENT ASSETS
    Cash                                 $ 148,863          $ 169,891
    Trade Receivables, Net of Allowance
     for Doubtful Accounts                  402,477            363,608
    Inventories                             315,367            224,326
    Prepaid Expenses and Other               42,919             62,480

     TOTAL CURRENT ASSETS                   909,626            820,305


    Property and Equipment (net of
     accumulated depreciation and
     amortization)                          170,798            173,390
    Other                                   33,506              25,806

     TOTAL NON-CURRENT ASSETS               204,304            199,196


     TOTAL ASSETS                       $ 1,113,930        $ 1,019,501
                                         -----------         ---------
</TABLE>
<PAGE>
<TABLE>




                             ZEON Corporation
                        BALANCE SHEETS (Continued)
<CAPTION>
                                        June 30, 1999  Dec31,1998
                                          (unaudited)

<S>                                      <C>             <C>
CURRENT LIABILITIES
Accounts Payable                         $ 139,399       $ 95,910
Accrued Expenses                            46,706         65,835
Line of Credit                              72,000           -0-
Current Portion of Long-Term Debt            6,528          6,528
     TOTAL CURRENT LIABILITIES             264,633        168,273

Long-Term Debt (net of current
     portion)                               21,201         24,596

     TOTAL LIABILITIES                     285,834        192,869

Shareholders Equity:
Common stock, no par, $.10 stated
value; authorized 100,000,000;
issued 348,825 and 349,205
June 30, 1999 and December 31, 1998         34,866         34,913

Capital in Excess of Stated Value          936,868        938,297
Deficit                                   (143,638)      (146,578
     TOTAL SHAREHOLDERS EQUITY             828,096        826,632

TOTAL LIABILITIES AND
     SHAREHOLDERS EQUITY               $ 1,113,930     $1,019,501
                                        -----------   -----------
</TABLE>
<PAGE>
<TABLE>
                             ZEON Corporation
                         STATEMENT OF OPERATIONS
                               (UNAUDITED)
<CAPTION>
                          Three Months Ended  Three Months  Ended
                           June 30, 1999       June 30, 1998
<S>                         <C>                  <C>
Net Sales                   $   798,276          $ 780,966
Cost of Sales                   568,737            516,928

Gross Profit                    229,539            264,038

Operating Expenses:
  Selling                        85,888             70,112
  General                       108,476            106,423
  Research & Development         35,735             36,510


                                230,099            213,045

Income (Loss) From Operations     ( 560)            50,993


Other Income (Expenses):
  Interest   Expense             (1,104)                0
  Interest Income                 1,085              1,257
  Other Income (Expenses)         8,199             14,323
                                  8,180             15,580

Income Taxes                        620                -0-

Net   Income                 $    7,000         $   66,573
                               ---------          ---------


Earning per share:
  Net  Income                 $     .02         $      .19
                               ---------          ---------
Weighted Average Common
  Shares Outstanding            348,841            349,205

</TABLE>
<PAGE>
<TABLE>


                             ZEON Corporation
                         STATEMENT OF OPERATIONS
                               (UNAUDITED)
<CAPTION>
                         Six  Months Ended    Six Months  Ended
                            June 30, 1999        June 30, 1998
<S>                         <C>                <C>
Net Sales                   $ 1,409,600        $ 1,564,923
Cost of Sales                   978,900          1,029,256

Gross Profit                    430,700            535,667

Operating Expenses:
  Selling                       153,425            146,783
  General                       220,813            206,340
  Research & Development         72,317             67,978


                                446,555            421,101

Income (Loss) From Operations   (15,855)           114,566


Other Income (Expenses):
   Interest  Expense             (1,534)            (   42)
   Interest Income                2,307              1,661
   Other Income (Expenses)       18,642             22,382
                                 19,415             24,001

Income Taxes                        620                -0-

Net Income                   $    2,940        $   138,567
                               ---------          ---------


Earning per share:
  Net   Income               $      .01        $       .40
                               ---------          ---------
Weighted Average Common
  Shares Outstanding            348,841            349,205

</TABLE>
<PAGE>
<TABLE>




                             ZEON Corporation
                         STATEMENTS OF CASH FLOWS
                               (UNAUDITED)
<CAPTION>
                                     SixMonthsEnded  SixMonthsEnded
                                     June 30, 1999  June 30, 1998
<S>                                       <C>        <C>
Cash Flows From Operating Activities:
     Net Income                           $   2,940  $  138,567
Adjustments to Reconcile Net Income
     to Net Cash Provided By (Used
     In) Operating Activities:
    Depreciation & Amortization              19,845       19,755
    Provisions for Losses on
       Accounts  Receivable                   4,500        5,000
Change in Operating Assets & Liabilities:
    Decrease (Increase) in Accts Receivable (43,369)    (107,215)
    Decrease (Increase) in Inventory        (91,041)      15,745
    Decrease (Increase) in Prepaid Assets    19,561      (23,900
    Increase (Decrease) in Accts Payable     43,489        3,487
    Increase (Decrease) in Accrued Exps     (19,129     (    128)
  TOTAL ADJUSTMENTS:                        (66,144)     (87,256)

  Net Cash Provided By (Used In) Operating
    Activity:                               (63,204)      51,311

  Cash Flows From Investing Activities:
     Proceeds from sale of Fixed Assets       1,300        6,000
     Purchase of Capital Assets            ( 26,253)     (61,263)

  Net Cash Provided by (Used In) Investing
    Activities:                             (24,953)     (55,263)

  Cash Flows From Financing Activities:
     Purchase of Common Stock                (1,476)         -0-
     Debt for Capital Purchases                 -0-       33,207
     Proceeds from Line of Credit            72,000          -0-
     Net Increase (Decrease) of
       Long-term Debt                        (3,395)         -0-

  Net Cash Provided By (Used In) Financing
    Activities:                              67,129       33,207

  Net Increase (Decrease) In Cash:          (21,028)      29,255

  Cash At Beginning of Period:              169,891      181,533

  Cash At End of Period:                  $ 148,863    $ 210,788
                                          ---------    ---------
</TABLE>
<PAGE>

                              ZEON Corporation
                       NOTES TO FINANCIAL STATEMENTS

1.   Summary of significant accounting policies:

     Inventories:
     Inventories are valued at the lower of cost or market.  Cost
     is  determined  at  standard, which  approximates  first-in,
     first-out.

     Property, Equipment and Depreciation:
     Property  and  equipment are stated at cost.  For  financial
     reporting  purposes,  depreciation is calculated  using  the
     straight-line  method  over  the  related  assets  estimated
     useful lives, which approximates five years. For income  tax
     reporting   purposes,  depreciation  is   calculated   using
     accelerated methods.

     Revenue Recognition:
     Sales are recorded in the periods that product is shipped.

     Taxes on Income:
     The Company follows the provisions of Statement of Financial
     Accounting  Standards No.109 - Accounting for  Income  Taxes
     (SFAS  No.109).  Under SFAS No. 109 the Company's policy  is
     to  provide  deferred  income  taxes  related  primarily  to
     depreciation  and  other items that  result  in  differences
     between the financial reporting and tax basis of assets  and
     liabilities.

     Earnings (Loss) Per Share:
     Income  (loss) per common share is computed on the basis  of
     the  weighted  average number of common  shares  outstanding
     during   each   period.   The  average  number   of   shares
     outstanding  was  348,841 and 349,137  during  each  of  the
     periods   ended  June  30,  1999  and  December  31,   1998,
     respectively.

     Reclassifications:
     Certain reclassifications have been made to the accompanying
     financial statements for comparative purposes.

2.   Inventories:

     Inventories consist of the following:
                                              June 30,  Dec. 31,
                                                1999      1998
          Finished Goods                     $  80,743  $  60,891
          Work-in-process                       21,328     19,017
          Raw Materials                        213,296    144,418
                                             $ 315,367  $ 224,326
                                             ---------  ---------
<PAGE>

                        ZEON Corporation
                 NOTES TO FINANCIAL STATEMENTS (CONTINUED)

3.   Notes payable and long-term debt:

     The  Company has a line-of-credit commitment from  its  bank
     for  borrowings  of  up to $100,000, with  interest  on  any
     borrowing at 1% above the bank's reference rate to  be  paid
     monthly.    The   loan   commitment,   if   exercised,    is
     collateralized  by trade receivables, inventories,  property
     and  equipment  and intangibles.  Under  the  terms  of  the
     agreement,  the Company is subject to certain  restrictions,
     which   include,   among  other  things,   restrictions   on
     borrowings  and  dividend payments.  At June  30,  1999  and
     December   31,   1998,  $72,000  and  $  -0-  amounts   were
     outstanding   under   the   line   of   credit   agreements,
     respectively.

     A  Company vehicle was purchased and financed with a $36,000
     loan.   Terms of the debt are five years and an 8 1/4%   interest
     rate.

4.   Commitments and related party transactions:

     In  December  1992,  the Company entered into  an  operating
     lease  to   consolidate  its  primary  manufacturing  and  office
     facilities.   The  property is leased through  January  2003
     from a partnership from which T. Bryan Alu, President and  Chief
     Executive  Officer  of the Company, is a  partner.   The lease
     contains  an  option  to  renew for two  additional five-year
     periods and requires monthly payments of approximately $8,000
     with the Company also responsible for maintenance and operating
     costs.

     The  Company  has  an  operating  lease  agreement  with  an
     unrelated  party  for  additional  manufacturing  facilities
     which  requires  monthly  payments of  approximately  $6,100
     through  December  31, 2000 including renewal  options.  The
     Company  entered into a sublease agreement  for  this  space
     with  an  unrelated party through December 31, 2000  for  an
     initial  monthly  rent of $9,700 and increasing  at  5%  per
     year.

     On  April  29, 1995, The board of directors of  the  Company
     adopted  the ZEON Corporation Stock Option Plan (the "Plan").
     The  Plan was approved by the stockholders at the Company's
     annual shareholders' meeting held on June 21, 1995.  The Plan
     allows the board of directors of the Company to grant both
     incentive stock options and options which do not qualify  as
     incentive  stock  options to employees and directors of the
     Company.  Thirty-five thousand (35,000) shares of the Company's
     common  stock are available for the grant of options pursuant
     to the Plan.  The exercise price for each incentive  stock
     option granted shall be no less than 100% of the fair  market
     value  (110% of the fair  market value for employees owning  more
     than 10% of the Company's common stock) of the common  stock
     on the day the  option is granted.  The exercise price  for
     each  non- qualified stock option granted under the Plan wil be
     the price established by the board of directors which
     normally is expected to  be no less than 100% of the fair
     market value on the date the option is  granted. A total of
     27,000 non-qualified options have been granted under the     plan
     for officers and employees of the Company, which vest ratably
     over Six years based on the Company achieving certain
     predetermined financial targets each fiscal year end.   These
     options were granted on February 27, 1998,at an  exercise
     price of $2.00 per share.  In  February  1999, 9,000 of
     these options had expired because certain predetermined
     financial targets were not met.


<PAGE>

                         ZEON Corporation
                 NOTES TO FINANCIAL STATEMENTS (CONTINUED)


      SFAS  No.  123,  "Accounting for Stock-Based Compensation",
      requires the Company  to  provide  pro  forma   information
      regarding net income (loss) and net earnings (loss) per  share
      as  if  compensation costs for the Company's stock option
      plans and other stock awards had been determined in accordance
      with  fair value based method prescribed in SFAS No. 123.   The
      Company estimates the fair value of each stock award by  using
      the Black-Scholes option-pricing model with the  following
      weighted-average  assumptions used for grants in 1998:  no
      expected  dividend yields for all years; expected volatility  of
      1.0%;  risk-free interest rates of 5.0%; and expected lives  of
      three  years.   The fair value of the options granted  during
      the  year  ended December 31, 1998 was approximately  $.28  per
      option.

      Effective  July  1991  the  Company  adopted  a  directors'
      compensation  plan to allow for the compensation of directors with
      restricted common stock of the Company in exchange for services
      provided.  Under the plan, shares issued are valued based upon
      the  market  value  of the stock as determined by the Company.
      As of June 30, 1999, no shares had been issued under this plan.

5.   Income Taxes:

      Final  payment of income taxes for 1998 was $10,200  versus
      the  $6,200 provided in the December 31, 1998 financials.     The
      difference of $4,000 was recorded in 1999 as a prior year
      adjustment.

<PAGE>

                  MANAGEMENT'S DISCUSSION AND ANALYSIS OF
               FINANCIAL CONDITION AND RESULTS OF OPERATIONS:

Factors That May Affect Operating Results

The  statements contained in this Form 10-QSB that are not purely
historical  are forward looking statements within the meaning  of
federal  securities  laws,  including  statements  regarding  the
Company's expectations, hopes, intentions or strategies regarding
the  future.   All  forward looking statements included  in  this
document are based on information available to the Company on the
date hereof, and the Company assumes no obligation to update  any
such  forward looking statements.  It is important to  note  that
the  Company's actual results could differ materially from  those
in such forward-looking statements.

Financial Condition:

The  liquidity  of  ZEON  Corporation remains  adequate,  with  a
current ratio of 3.4 to 1 as of June 30, 1999, and 5.0 to 1 as of
December  31,  1998.  Despite 1999's first half sales  being  10%
below  last  year's  first half, collection experiences  remained
constant  and  inventory turnover improved  slightly.   Inventory
levels have increased by $91,000 to address the Company's growing
backlog.   Capital  expenditures were $23,000  for  manufacturing
equipment.  Liquidity from on-going operations and the  Company's
line  of  credit  is  considered adequate to meet  the  Company's
immediate cash requirements.

Results of Operations:

Results  of operations for the Three months ending June 30,  1999
and 1998

                                THREE MONTHS ENDED JUNE 30,

                                 1999                 1998

          Sales:             $ 798,276             $ 780,966
          Income:                7,000                66,573


Orders  received for the quarter were $750,000 or $50,000 greater
than  second  quarter  1998.  Although sales  increased  2%  over
1998's  second quarter, gross profit percentage fell 5 points  to
28.8%.   The  hiring  of senior manufacturing  management  (1.2),
extraordinary  airfreight costs (1.8) and unfavorable  product  mix
(2.0)   accounted  for  the  gross  profit  decrease.   Operating
expenses  increased  by $17,000 over last year's  second  quarter
primarily in Selling Expense.

Selling  Expense  increased from $70,000 to $86,000  from  1998's
second  quarter to 1999's second quarter.  All of  this  increase
resulted from additional convention and related travel expenses.

Current  second quarter General and Administrative Expenses  rose
by  $2,000  to $108,000 over same period last year. The  increase
was due to reinstatement of full time Controller and the hiring of
manufacturing manager.  Such increase was partially offset by reduced
payroll for office staff.  (In second quarter 1998, the Controller's
salary was partially allocated to production costs.)

Research  and Development Expense remained constant at a  $36,000
level.

<PAGE>

                  MANAGEMENT'S DISCUSSION AND ANALYSIS OF
               FINANCIAL CONDITION AND RESULTS OF OPERATIONS:



Results of operations for the Six months ending June 30, 1999 and
1998

                                 SIX MONTHS ENDED JUNE 30,

                                 1999                 1998

          Sales:            $1,409,600            $1,564,923
          Income:                2,940               138,567


Sales  for  1999  first  half fell 10% from  1998's  first  half.
Modest  profit made in the second quarter offset first  quarter's
loss, resulting in a net income of $2,940.  Despite the Company having a
soft  year-end  backlog, orders for the first half of 1999 were
$1,618,000  or 11% over 1998's first half.  However, personnel
turnover in  production  assembly and other capacity issues hampered
shipments in the 1999's  first half. This has resulted in an above
average backlog as of June 30, 1999.

Gross  profit margin, as a percentage of sales in the first  half
of  1999, was 31% or down 3.6 points from 1998's first half. This
point  drop  was  due to lower volume/product mix  (2.2  points),
additional  manufacturing manager payroll (.6), and extraordinary
freight (.8).

Selling  expenses increased by 4% percent over first  half  1998.
The  $6,000 increase resulted from convention and related  travel
expenses.

General  and  Administrative expenses increased by  $15,000  over
same period last year.  The additional expenses were salaries related to
reinstatement of full time Controller and the hiring of a manufacturing
manager mid-1998. (In the first half of 1998, the Controller's salary
was partially allocated to production costs.)

Research  and  development  increased  by  $4,000  primarily   in
salaries and prototype supplies.

<PAGE>


                    PART II-OTHER INFORMATION

Item 4.  Submission of matters to a vote of Security-Holders

     The Company had its annual shareholders' meeting on July 30,
1999.   The  following sets forth the matters acted  upon  at
such meeting and the voting results with respect to each
matter:

                                        For       Withheld
          1.) Election of Directors
                    T. Bryan Alu        284,285        77
                    Alan M. Bloom       284,285        77
                    Jay R. Beyer        284,285        77

Item 5.  Other information

               None

Item 6.  Exhibits and Reports on Form 8-K

     Part A.   None

     Part B.   No  reports  on Form 8-K have been filed  for  the
               quarter ended
               June 30, 1999.




<PAGE>



                           SIGNATURES


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




Date:         August  6,  1999                /s/  T.  Bryan  Alu
                                             T. Bryan Alu
                                             President



                                             /s/     R.G.   Routt
                                             R. G. Routt
                                             Corporate Controller