UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                          Washington, D. C. 20549
                                     
                                 FORM 10-Q
                                     
     (Mark One)
  (X) Quarterly Report Under Section 13 or 15(D) of The Securities Exchange
      Act of 1934 For Quarter Ended September 30, 1996

                       OR

  ( ) Transition Report Pursuant to Section 13 or 15(d) of The  Securities
      Exchange Act of 1934


                       Commission File Number 0-275


                              Allen Organ Company
          (Exact name of registrant as specified in its charter)



     Pennsylvania                       23-1263194
  (State of Incorporation)      (I.R.S. Employer Identification No.)



  150 Locust Street, P. O. Box 36, Macungie, Pennsylvania      18062-0036
  (Address of principal executive offices)                     (Zip Code)



Registrant's telephone number, including area code           610-966-2200


Indicate  by  check mark whether the registrant (1) has filed  all  reports
required to be filed by Section 13 or 15(d) of the Securities Exchange  Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject  to
such filing requirements for the past 90 days.

                         Yes    X        No _____
                                     
Number of shares outstanding of each of the issuer's classes of common
stock, as of October 29, 1996:

                    Class A - Voting          84,984 shares
                    Class B - Non-voting   1,243,333 shares
<PAGE>                            
                            ALLEN ORGAN COMPANY
                                  INDEX

Part I  Financial Information

   Item 1.Financial Statements

          Consolidated Condensed Statements of Income for the nine months
          ended September 30, 1996 and 1995                         

          Consolidated Condensed Balance Sheets at September 30, 1996 
          and December 31, 1995               

          Consolidated Condensed Statements of Cash Flows for the nine
          months ended September 30, 1996 and 1995                       

          Notes to Consolidated Condensed Financial Statements        

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

Part II    Other Information

   Item 6.Exhibits and Reports on Form 8-K                           

   Signatures                                                        

   Exhibit                                                           
<PAGE>
PART I  FINANCIAL INFORMATION
   ITEM 1.FINANCIAL STATEMENTS

                      ALLEN ORGAN COMPANY AND SUBSIDIARIES
                                        
                   CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                                   (Unaudited)
                                        
                                        
                          For the 3 Months Ended:   For the 9 Months Ended:
                           9/30/96       9/30/95      9/30/96      9/30/95

Net Sales                $8,985,238    $7,694,648   $26,363,056  $21,677,748
                                                                 
Cost and expenses                                                
 Costs of sales           6,138,645     5,230,489    17,193,168   14,657,845
 Selling, general and     
  administrative          1,474,311     1,198,548     4,509,307    3,298,596
 Research and development   632,148       410,738     1,975,991      729,420
  Total Costs and         
   Expenses               8,245,104     6,839,775    23,678,466   18,685,861

Income from operations      740,134       854,873     2,684,590    2,991,887

Other Income and (Expense)
 Interest and other         
  income                    397,752       466,511     1,441,245    1,482,385
 Interest expense            (1,706)      (17,404)      (10,309)     (17,404)
 Minority interests in                                           
  net loss of consolidated    
  subsidiaries               27,780        16,363        82,391       16,363
 Total Other Income and    
  Expense                   423,826       465,470     1,513,327    1,481,344

Income before taxes on    
 income                   1,163,960     1,320,343     4,197,917    4,473,231

Provision for taxes on     
 income                     400,000       442,000     1,447,000    1,592,000

Net Income                 $763,960      $878,343    $2,750,917   $2,881,231

Earnings per share            $0.58         $0.64         $2.05        $2.11

Shares used in per share  
 calculation              1,344,314     1,367,068     1,344,314    1,367,068
                                                                           
                                                                           
Dividends per share-Cash      $0.13         $0.13         $0.39        $0.39
                                        
                             See accompanying notes.
<PAGE>                      
                      ALLEN ORGAN COMPANY AND SUBSIDIARIES
                      CONSOLIDATED CONDENSED BALANCE SHEETS
                                                September 30,   Dec 31,
                     ASSETS                          1996        1995
                                                 (Unaudited)   (Audited)
Current Assets                                                
  Cash                                            $1,173,752   $ 196,100
  Investments Including Accrued Interest          28,154,682  30,766,266
  Accounts Receivable                              5,448,372   4,431,499
  Inventories:                                                
     Raw Materials                                 6,462,220   6,788,504
     Work in Process                               6,043,347   5,658,610
     Finished Goods                                1,524,490     981,471
     Total Inventories                            14,030,057  13,428,585
  Prepaid Income Taxes                                48,914     856,630
  Prepaid Expenses                                   255,503     103,420
     Total Current Assets                         49,111,280  49,782,500
Property, Plant and Equipment                     17,404,334  17,057,373
  Less Accumulated Depreciation                   (9,742,918) (9,278,875)
     Total Property, Plant and Equipment           7,661,416   7,778,498
Other Assets                                                  
  Prepaid Pension Costs                              951,312   1,021,517
  Inventory Held for Future Service                1,241,949   1,219,872
  Note Receivable                                    163,148     122,586
  Cash Value of Life Insurance                       851,611     629,481
  Intangible and Other Assets                      3,776,803   4,744,972
     Total Other Assets                            6,984,823   7,738,428
     Total Assets                                $63,757,519 $65,299,426
                  LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Current Liabilities                                           
  Current Portion of Long Term Debt                $   --      $ 347,000
  Accounts Payable                                   579,965     535,276
  Deferred Income Taxes                               64,322      64,322
  Other Accrued Expenses                             620,530   1,691,328
  Customer Deposits                                  962,730     463,019
     Total Current Liabilities                     2,227,547   3,100,945
Noncurrent Liabilities                                        
  Deferred Liabilities                               835,433     841,687
  Long Term Debt, Net of Current Portion               --      1,388,000
     Total Noncurrent Liabilities                    835,433   2,229,687
     Total Liabilities                             3,062,980   5,330,632
STOCKHOLDERS' EQUITY                                          
  Common Stock   1996              1995                          
     Class A   128,104 shares;   128,104 shares      128,104     128,104
     Class B 1,409,889 shares; 1,409,889 shares    1,409,889   1,409,889
  Capital in Excess of Par Value                  12,758,610  12,758,610
  Retained Earnings                                           
     Balance, Beginning                           49,786,163  46,524,142
     Net Income                                    2,750,917   4,015,105
     Dividends - Cash 1996 and 1995                 (524,454)   (753,084)
     Balance, End                                 52,012,626  49,786,163
  Unrealized Gain (Loss) on Investments               93,218      94,136
  Minority Interest                                  126,177     313,941
  Treasury Stock                                              
   1996 - 43,120 Class A shares
         166,556 Class B shares                   (5,834,085)      --
   1995 - 43,120 Class A shares
         131,835 Class B shares                       --      (4,522,049)
  Total Stockholders' Equity                      60,694,539  59,968,794
  Total Liabilities and Stockholders' Equity     $63,757,519 $65,299,426
                                                              
                             See accompanying notes.
<PAGE>
                      ALLEN ORGAN COMPANY AND SUBSIDIARIES
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                      For the 3 Months       For the 9 Months
                                           Ended:                  Ended:
                                     9/30/96   9/30/95     9/30/96    9/30/95
CASH FLOWS FROM OPERATING 
ACTIVITIES
Net income                          $763,960   $878,343  $2,750,917  $2,881,231
Adjustments to reconcile net                                           
income to net cash provided by
operating activities
 Depreciation and amortization       204,938    163,057     617,181     426,415
 Minority interest in net loss       
  of consolidated subsidiaries       (27,780)   (16,363)    (82,391)    (16,363)
 Change in assets and liabilities                                       
   (Increase) Decrease in 
     accounts receivable          (1,033,598)   126,182  (1,016,873)    124,542
   (Increase) Decrease in            
     inventories                    (149,733)  (588,337) (1,254,434) (1,335,624)
   (Increase) Decrease in prepaid  
     income taxes                    (48,914)   (78,330)    807,716     198,250
   (Increase) Decrease in prepaid     
     expenses                        (34,385)    94,600    (152,083)    (87,721)
   (Increase) Decrease in prepaid      
     pension costs                    62,625       --        70,205        --
   (Increase) Decrease in deferred     
     income tax benefits                --         --          --        67,420
   (Decrease) Increase in accounts    
     payable                         (53,933)  (299,992)     44,689    (214,512)
   (Decrease) Increase in accrued    
     taxes                           (62,190)  (144,934)       --          --
   (Decrease) Increase in accrued   
     expenses                       (193,329)  (116,405) (1,397,263)   (167,348)
   (Decrease) Increase in customer    
     deposits                         42,480    109,641     499,711     183,773
   (Decrease) Increase in other       
     noncurrent liabilities           53,522    162,545      (6,254)    271,643
      Net Cash Provided by (Used    
       in) Operating Activities     
       Activities                   (476,337)   290,007     881,121   2,331,706
                                                                        
CASH FLOW FROM INVESTING                                                
ACTIVITIES
   Payment for acquisition, net 
   of cash acquired                    --    (3,639,338)      --     (3,639,338)
   Increase in other assets            --      (393,888)      --       (393,888)
   Net additions to plant and       
    equipment                       (121,770)  (306,168)   (396,221)   (473,549)
   Increase in cash value of life   
    insurance                       (222,130)  (215,849)   (222,130)   (215,849)
   Increase in note receivable       (40,562)   (40,731)    (40,562)    (40,731)
   Purchase of minority               
    shareholders' interest in                                   
    subsidiary                         --          --       (20,000)       --
   Net sale (or purchase) of       
    investments                    1,838,013  4,642,134   2,610,666   4,514,360
    Net Cash Provided by (Used in) 
     Investing Activities          1,453,551     46,160   1,931,753    (248,995)
                                                                        
CASH FLOWS FROM FINANCING                                               
ACTIVITIES
Reacquired Class B common shares    (297,375)(1,006,613) (1,312,036) (1,054,278)
Dividends paid in cash              (172,691)  (180,386)   (524,454)   (534,975)
Subsidiary company stock issued     
to minority shareholders               --         --          4,840       --
Subsidiary company stock           
reacquired from minority              
shareholders                          (3,572)     --         (3,572)      --
  Net Cash Used In Financing        
   Activities                       (473,638)(1,186,999) (1,835,222) (1,589,253)
                                                                        
NET INCREASE (DECREASE) IN CASH      503,576   (850,832)    977,652     493,458
                                                                        
CASH, BEGINNING                      670,176  1,449,357     196,100     105,067
                                                                        
CASH, ENDING                      $1,173,752   $598,525  $1,173,752    $598,525
                                                            
               SUPPLEMENTAL DISCLOSURES OF CASH FLOWS INFORMATION
Cash paid for:                                                         
   Income Taxes                     $530,000    $642,000   $823,338  $1,397,682
   Interest                         $  1,706    $   --     $ 53,322  $     --
     SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES
 Liability incurred to purchase                                        
  inventory in connection with      
  acquisition                       $   --    $1,243,601   $   --    $1,243,601
 Long term debt incurred in         
  connection with asset                                                 
  acquisition                       $   --    $1,735,000   $   --    $1,735,000
 Purchase price adjustment of                                          
  August 1, 1995 acquisition
   Decrease of accrued liability    
    incurred to purchase inventory  $   --    $     --     $630,885  $     --
   Decrease in long term debt           --          --    1,735,000        --
   Decrease in minority interest        --          --       86,641        --
   Decrease in inventory                --          --     (630,885)       --
   Decrease in intangible assets       
    (Goodwill)                          --          --     (864,291)       --
   Increase in current accrued           
    liabilities                         --          --     (957,350)       --
    Total                          $    --     $    --     $   --    $     --
                                        
                             See accompanying notes.
<PAGE>                     
                     ALLEN ORGAN COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Interim Financial Statements

   The  results  of  operations for the interim  periods  shown  in  this
   report  are  not necessarily indicative of results to be expected  for
   the  fiscal  year.   In  the  opinion of management,  the  information
   contained  herein  reflects  all adjustments  necessary  to  make  the
   results  of  operations for the interim periods a  fair  statement  of
   such  operations.   All  such adjustments are of  a  normal  recurring
   nature.

   Certain  notes  and other information have been condensed  or  omitted
   from  the  interim  financial statements presented  in  the  Quarterly
   Report on Form 10-Q.  Therefore, these financial statements should  be
   read in conjunction with the company's 1995 Annual Report on Form 10-K.


2. Purchase Price Adjustment of August 1, 1995 Acquisition
   On  May 10, 1996, the Company entered into an agreement with the seller  of
   the  three  data communications companies acquired on August  1,  1995,  to
   settle  an  indemnity  claim against the seller by adjusting  the  purchase
   price and payment terms for the acquired companies.
   
   The  terms  of the agreement provided for the $880,885 balance due  on  the
   obligation  incurred to purchase some of the inventory to be  satisfied  by
   the  payment  of $250,000.  Further, the Note Payable of $1,735,000  issued
   as  part  of the purchase price has been canceled in exchange for a current
   payment  of  $900,000  and  a contingent annual  payment  for  five  years,
   effective  January 1, 1996, of 4.5% of the acquired companies annual  sales
   exceeding  $7,000,000  (the  acquired companies  proforma  net  sales  were
   $7,397,472  and $5,208,003 in 1995 and 1994 respectively).   The  agreement
   provides  that  the  total  of the contingent  payments  shall  not  exceed
   $2,000,000.   The  employment  agreement  between  VIR  and  its  President
   (majority  owner  of the selling companies) has been modified  so  that  he
   shall  now  be  a consultant to the companies, with payment  based  on  the
   number of hours worked at the request of the companies.


3. Pro Forma Financial Information
   The  following  pro  forma financial information has been  prepared  giving
   effect  to  the acquisition of VIR, ERI, and LSC as if the transaction  had
   taken  place  at  the beginning of the applicable period.   The  pro  forma
   financial  information  is not necessarily indicative  of  the  results  of
   operations  which  would  have  been attained  had  the  acquisitions  been
   consummated on any of the foregoing dates or which may be attained  in  the
   future.

                            For the 3 Months Ended    For the 9 Months Ended
                                   9/30/95                   9/30/95
       Net Sales                $ 8,083,216               $26,413,358
       Net Income                   951,658                 3,189,364
       Net Income Per Share           $0.70                     $2.33

ITEM 2:  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND
RESULTS OF OPERATIONS.

Sales and Operating Income
                           For the 3 Months Ended     For the 9 Months Ended   
                             9/30/96      9/30/95       9/30/96      9/30/95
  Net Sales                                                         
   Musical Instruments     $6,065,251   $5,764,615   $17,920,842  $18,059,265
   Data Communications      2,111,289    1,041,653     5,605,243    1,041,653
   Electronic Assemblies      808,698      888,380     2,836,971    2,576,830
    Total                  $8,985,238   $7,694,648   $26,363,056  $21,677,748
    
  Income (loss) from operations
   Musical Instruments       $635,556     $676,251    $2,304,267   $2,572,327
   Data Communications        (10,777)      49,171       (26,335)      49,171
   Electronic Assemblies      115,355      129,451       406,658      370,389
    Total                    $740,134     $854,873    $2,684,590   $2,991,887

Musical Instruments Segment
   Sales increased $300,636 for the three months ended September 30, 1996 when
compared  to the same period in 1995 due to a increase in incoming orders  and
change in the product mix of instruments shipped. Sales for the 9 months ended
September 30, 1996 have remained relatively equal to the same period in  1995.
New  orders  have increased over 1995 and the musical instruments  backlog  is
higher  when compared to the same period in 1995.  The gross profit percentage
decreased to 31% in the first nine months of 1996 compared to 33% in the  same
period  last  year.   The  current quarter gross  profit  percentage  was  27%
compared  to  30% in the second quarter of 1995.  These declines  are  due  to
increases  in direct costs and indirect overhead costs.  Selling, general  and
administrative expenses for the three and nine months ended September 30, 1996
remained approximately the same as the same period in 1995.

Data Communications Segment
    Sales  increased  from  the preceding quarter ended  June  30,  1996  from
increased order volume.  This increase is attributable to the increased  sales
and  marketing  effort initiated since the acquisition.  Gross profit  margins
decreased  to  51% of sales from 55% in the preceding quarter ended  June  30,
1996  from  variations  in product mix.  Selling, general  and  administrative
expenses  increased slightly from the preceding quarter ended  June  30,  1996
primarily  due to higher sales and marketing costs.  Research and  development
expenses were $1,399,814 for the nine months ended September 30, 1996.   These
expenditures,  which the company plans to continue at a similar or  increasing
rate in the future, reflect the segments commitment to new product development
and  support.  For information pertaining to an agreement affecting  the  data
communications  segments, see note 2 to the Consolidated  Condensed  Financial
Statements.

Electronic Assemblies Segment
    Sales  for the 9 month period ended September 30, 1996 increased  $260,141
when  compared  to  the  same  period in 1995  from  increased  order  volume.
Operating  income increased proportionally with the increase in sales  volume.
Sales  and operating income for the current quarter declined when compared  to
the same period in 1995 due to lower shipments.

Other Income and Expense

   Interest and other income for the three and nine months ended September 30,
1996 declined when compared to the same period in 1995 due to lower levels  of
invested funds and lower rates of return available on those funds.


PART II    OTHER INFORMATION
   
   Item 6.     Exhibits  and Reports on Form 8-K
   
   (a)   Exhibits
           Exhibit No.           Description
              10            Executive  Incentive  Plan  (Supercedes the 
                            Officers Bonus Plan as amended December 2, 1991)
   
   (b)   No  reports  on  form  8-K were filed during the  quarter  ended
          September 30, 1996.

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.

                                    Allen Organ Company
                                       (Registrant)

Date: October 30, 1996              STEVEN MARKOWITZ
                                    Steven Markowitz, President and
                                    Chief Executive Officer

Date: October 30, 1996              LEONARD W. HELFRICH
                                    Leonard W. Helfrich, Vice President-
                                    Finance and Principal Accounting Officer