FORM 10-Q


                      SECURITIES AND EXCHANGE COMMISSION

                            WASHINGTON, DC  20549


                  Quarterly Report under Section 13 or 15(d)

                    of the Securities Exchange Act of 1934


For Quarter Ended September 30, 1995            Commission File Number 2-36877


                               IREX CORPORATION


     Pennsylvania                                          23-1712949         

     120 North Lime Street, Lancaster                           17603         

     Registrant's Telephone Number, Including Area Code, (717) 397-3633




     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       


               Common Shares Outstanding (Single Class) 395,515
<PAGE>
                      IREX CORPORATION AND SUBSIDIARIES




                       PART I.   FINANCIAL INFORMATION



Item 1.   Financial Statements.

     The condensed financial statements included herein have been
     prepared by Irex Corporation (the "Company"), without audit,
     pursuant to the rules and regulations of the Securities and
     Exchange Commission.  Certain information and footnote disclo-
     sures normally included in financial statements prepared in
     accordance with generally accepted accounting principles have
     been condensed or omitted pursuant to such rules and regula-
     tions.

     The financial information presented herein reflects all adjust-
     ments (consisting only of normal recurring adjustments) which
     are, in the opinion of management, necessary for a fair presen-
     tation of the results for the interim periods presented. 
     Certain prior period amounts have been reclassified to conform
     with the current presentation.  The results for interim periods
     are not necessarily indicative of the results to be expected for
     the full year.



                                    - 1 -
<PAGE>
                      IREX CORPORATION AND SUBSIDIARIES                       
                      CONSOLIDATED STATEMENTS OF INCOME  
                                 (Unaudited)
<TABLE>
<CAPTION>
                                     Third Quarter         Ended September 30   
                                   1995          1994       1995         1994   
                         (Dollars in Thousands Except Per Common Share Amounts) 
<S>                            <C>           <C>        <C>          <C>
Contracting Revenues           $ 31,546      $ 37,319   $ 98,661     $106,586 

Distribution and Other Revenues  28,552        25,826     80,723       67,470 

       Total Revenues            60,098        63,145    179,384      174,056 

Cost of Revenues                 47,513        49,351    140,807      136,257 

       Gross Profit              12,585        13,794     38,577       37,799 

Selling, General and 
   Administrative Expenses       12,301        11,852     37,375       34,644 

       Operating Income             284         1,942      1,202        3,155 

Interest Expense, Net               436           664      1,355        1,826 

       Income (Loss)
         Before Income Taxes       (152)        1,278       (153)       1,329 

Income Tax Provision (Benefit)      (64)          556        (79)         578 

Income (Loss) Before Cumulative Effect
       of Accounting Change         (88)          722        (74)         751 

Cumulative Effect of Accounting Change,
       Net of Income Taxes            -             -      1,377            -  

Net Income (Loss)             $     (88)    $     722  $   1,303   $      751 

       Less:Dividend Requirements
         for Preferred Stock       (245)         (245)      (735)        (735)

NET INCOME (LOSS) APPLICABLE
       TO COMMON STOCK       $     (333)    $     477  $     568   $       16 

Avg. Common Shares Outstanding  396,400       400,506    397,645      401,718 

Per Common Share Amounts

Income (Loss) Before Cumulative 
     Effect of Acctg. Change $    (0.84)    $    1.19  $   (2.03)  $     0.04 

Cumulative Effect of Acctg. Chg.      -             -       3.46            -   

Net Income (Loss)            $    (0.84)    $    1.19  $     1.43  $     0.04 
</TABLE>

                                     - 2 -
<PAGE>
                       IREX CORPORATION AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS    
                                  (Unaudited)
<TABLE>
<CAPTION>
                                           September 30       December 31 
                                              1995              1994      
                                                  (In Thousands)              
<S>                                         <C>            <C>
       ASSETS

Cash and Cash Equivalents                   $      628      $      1,564
Receivables, Net                                50,419            51,758
Inventories                                     12,503            10,887
Deferred Income Taxes                            7,925             8,896
Prepaid Expenses                                   589             1,027
Excess of Cost and Estimated Contract 
       Revenue over Actual Billings              5,503             4,563

       Total Current Assets                     77,567            78,695

Property and Equipment, Net                      3,224             3,481
Other Assets                                       161               384

           TOTAL ASSETS                     $   80,952        $   82,560

LIABILITIES AND SHAREHOLDERS' INVESTMENT

Notes Payable                                $   7,029         $   6,007 
Current Portion of Long-Term Debt                1,454             1,580 
Accounts Payable                                 8,994             8,268 
Excess of Actual Billings Over Cost and 
       Estimated Contract Revenue                2,974             2,381 
Accrued Liabilities                             25,043            28,807 

       Total Current Liabilities                45,494            47,043 

Long-Term Debt (Less Current Portion)           15,100            15,800 

Redeemable Preferred Stock                      10,496            10,496 

Capital Stock                                    1,028             1,028 
Paid-in Surplus                                    466               472 
Retained Earnings                               26,987            26,419 
Cumulative Translation Adjustments                (139)             (190)
Treasury Stock at Cost                         (18,425)          (18,347)
ESOP Shares Financed with Debt                     (55)             (161)

       Total Shareholders' Investment            9,862             9,221 

       TOTAL LIABILITIES AND 
       SHAREHOLDERS' INVESTMENT             $   80,952        $   82,560 
</TABLE>


                                     - 3 -
<PAGE>
                       IREX CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   Unaudited
<TABLE>
<CAPTION>
                                          Nine Months Ended September 30  
                                              1995              1994    
<S>                                        <C>                <C>
       (In Thousands)                    
Cash Flows from Operating Activities

Net Income                                  $    1,303         $     751 
Non-cash items included in net income
       Depreciation and Amortization               905             1,274 
       Deferred Income Taxes                       971                 5 
       Stock Contr. to Employee Benefit Plans      (84)              (86)     
       Provision for Bad Debts                     291               243 

(Increase) decrease in current assets
       Receivables                               1,048            (2,148)
       Inventories                              (1,616)           (1,790)
       Prepaid expenses                            438               (19)
       Excess of Cost and Estimated Contract                 
         Earnings Over Actual Billings (Net)      (347)              141 

(Decrease) increase in current liabilities
       Accounts Payable                            726              (373)
       Other accrued liabilities                (3,764)            1,684 

       Net cash used in operating activities      (129)             (318)

Cash Flows from Investing Activities

       Net additions to property and equipment    (648)           (1,016)
       Decrease in other assets                    223               379 
       Exchange rate changes                        51              (381)

       Net cash used in investing activities      (374)           (1,018)

Cash Flows from Financing Activities

       Increase in notes payable                 1,022             3,734 
       Payment on debt                            (720)             (728)
       Dividend payments                          (735)             (735)

       Net cash (used in) provided by
         financing activities                     (433)            2,271 

Net (decr) incr in Cash and Cash Equivalents      (936)              935 

Cash and Cash Equivalents at Begin. of Period    1,564             1,068 

Cash and Cash Equivalents at End of Period  $      628        $    2,003 
</TABLE>



                                     - 4 -
<PAGE>
                       IREX CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (Unaudited)



(1)    The consolidated financial statements include the accounts of Irex 
       Corporation ( "the Company" ) and its subsidiaries, all of which are
       wholly owned.  All significant intercompany accounts and transactions
       have been eliminated in consolidation.

       The Company is primarily engaged in the business of thermal insulation 
       contracting throughout the United States and Canada.  Allied activities 
       include the direct sale of insulation and acoustical materials, the
       fabrication of insulation materials, and interior contracting.

(2)    During 1992, the Company offered to exchange one share of preferred stock
       with a par value of $1.00 per share for each share of the Company's 
       outstanding common stock up to a maximum of 350,000 common shares.  
       A total of 349,864 common shares were exchanged in December 1992 for the
       redeemable preferred stock.  The common shares exchanged were placed in 
       Treasury stock.  Dividends on the preferred stock accrue at an annual
       rate of $2.80 per share.  Such dividends are cumulative and payable 
       quarterly in arrears.

       The Company has authorization for 2,000,000 shares of its common stock 
       with a par value of $1.00 per share.  At September 30, 1995, 1,028,633 
       shares were issued, 395,515 shares were outstanding and 633,118 shares
       were held, at cost, in Treasury stock.

(3)    All highly liquid investments with a maturity of three months or less at
       the time of purchase are considered to be cash equivalents.  Certain 
       funding of the Company's defined contribution savings incentive and
       employee stock ownership plans are treated as non-cash financing 
       activities in the consolidated statements of cash flows.  The Company's 
       income tax and interest payments for the first nine months of 1995 and
       1994 were:

                                       1995                          1994     

             Income Taxes:         $ 1,205,000                   $   349,000
                 Interest:         $   984,000                   $ 1,249,000

(4)    The Company is self-insured against a portion of its workers' 
       compensation and other insurance risks.  The process of determining 
       reserve requirements for losses within its self-insured retention limits
       utilizes historical trends, involves an evaluation of claim frequency, 
       severity and other factors and also includes the effect of future 
       inflation.


                                     - 5 -
<PAGE>

   Effective January 1, 1995, the Company changed its method of measuring the 
   astimated liability for workers' compensation claims.  The new method employs
   actuarial assumptions to discount to present value the estimated future 
   payments for these claims, using a risk-free interest rate.  The Company
   believes this method is preferable because it more accurately reflects the 
   current impact on it's financial condition of the future cash outflows.  The 
   cumulative effect of this accounting change was $1,377,000 ($2,276,000 less 
   the related tax effect of $899,000) and was included in net income for the 
   nine months ended September 30, 1995.  The impact of this change, exclusive 
   of the cumulative effect , on operating results in the first nine months of 
   1995 was not significant nor is it expected to have a significant impact on 
   future results of operations.

   At January 1, 1995, the estimated undiscounted liability for workers' 
   compensation claims was $13,310,000.  The present value of such claims was 
   $11,034,000, using a weighted average discount rate of 7.4%.

   The expected future payments as of January 1, 1995, on an undiscounted basis,
   were as follows:

                   1995                     $3,597,000
                   1996                      2,242,000
                   1997                      1,676,000
                   1998                      1,323,000
                   1999                        994,000
                   2000 and Thereafter       3,478,000
                                           $13,310,000



                                     - 6 -
<PAGE>
                       IREX CORPORATION AND SUBSIDIARIES
                          September 30, 1995 and 1994

                    Management's Discussion and Analysis of
                 Financial Condition and Results of Operations





Results of Operations

   Operating income for the third quarter of 1995 was $284,000.  The similar 
period for 1994 resulted in income of $1,942,000.  For the nine months ended 
September 30, 1995, operating income was $1,202,000 as compared to $3,155,000
for nine months ended September 30, 1994.  Although profitable, the reduction
in operating income is mainly a result of continuing competitive pressures and 
limited execution problems experienced by the Company's contracting operations.

   After the preferred stock dividend requirement, net losses applicable to 
common shareholders was ($333,000) or ($0.84) per share for the third quarter of
1995.  The comparable period of 1994 indicated net income of $477,000 or $1.19
per share.  For the nine-month period ending September 30, 1995, a loss after
the preferred stock dividend requirement of ($809,000) was incurred versus a 
profit of $16,000 for the first nine months of 1994.  The recognition of an 
accounting change in the first quarter of 1995 of $1,377,000, net of income
taxes, produces net income for September year-to-date results of $568,000.  
There were no accounting change effects for 1994 results.  For the nine-month
period, earnings per common share were $1.43 for 1995 compared to $0.04 
for 1994.

   The following table presents, for the periods indicated, certain items in the
Company's consolidated statements of income as a percentage of total revenue:
<TABLE>
<CAPTION>
                                Three Months Ended        Nine Months Ended
                                    September 30            September 30    
                                  1995       1994          1995       1994
<S>                              <C>       <C>           <C>        <C>
Contracting Revenues              52.5%      59.1%         55.0%      61.2%
Distribution & Other Revenues     47.5%      40.9%         45.0%      38.8%
                                 100.0%     100.0%        100.0%     100.0%

Gross Profit Margin               20.9%      21.8%         21.5%      21.7%
Income from Operations             0.5%       3.1%          0.7%       1.8%
Net Income (Loss) Before          (0.1%)      1.1%         (0.1%)      0.4%
   Accounting Change
</TABLE>



                                     - 7 -
<PAGE>

Revenues

   Contracting revenues are down significantly (15.5%) from the third quarter of
last year .  Year-to-date contracting revenues were $98,661,000, which are down 
7.4% from prior-year revenues of the same period that amounted to $106,586,000.

   Distribution revenues continue on a record pace at levels significantly 
exceeding prior yesr periods for both the quarter and nine months ended 
September 30.  For the quarter ended September 30, 1995, distribution revenues
were $28,552,000 which is a 10.6% increase over revenues of $25,826,000 reported
for the same period of 1994.  For the nine-month period ended September 30, 1995
distribution revenues were 19.6% over prior year levels.  Distribution revenues 
amounted to $80,723,000 for 1995 versus $67,470,000 for 1994 .


Gross Profit

   For the third quarter ended September 30, 1995, gross profit was $12,585,000,
down 7.8% from the 13,794,000 reported for prior year third quarter.  Gross 
profit margins were 20.9% and 21.8% for the respective periods.  In addition 
to competitive conditions, the previously mentioned execution problems in the
contracting businesses had a negative impact on these results.  For nine months
ended September 30 , gross profit margins are similar totaling 21.5% for 1995 
and 21.7% for 1994.  Through the aforementioned growth of the distribution 
activities, gross profit dollars have increased 2.1% to $38,577,000 for the nine
months of 1995 versus $37,799,000 for the same period of 1994.


Selling, General and Administrative Expenses

   Operating expenses amounted to $12,301,000 for the quarter ended 
September 30, 1995, an increase of 3.8% for the period.  Prior year expenses for
the similar period totaled $11,852,000.  For the nine-month period , expenses
$37,375,000 for 1995 and $34,644,000 for 1994.  This increase is reflective of
the additional distribution locations that have been added since the first 
quarter of 1995.  Distribution has added six additional branches which 
resulted in an increase of 16 full-time salaried positions.  Year-to-date 
expenses as a percentage of sales has risen slightly to 20.8% in 1995 from 19.9%
in 1994.


Financial Condition and Liquidity

   Significant improvements over prior year-end results continue.  Accounts 
receivable have declined over $1.0 million.  The Company at September 30, 1995, 
had working capital of $32.1 million and shareholders' equity (excluding 
preferred stock) of $9.9 million.  Working capital at December 31, 1994,
was $31.7 million and shareholders' equity was $9.2 million.

   Total short-term lines of credit of $22.8 million at September 30, 1995, 
remain adequate to provide sufficient liquidity for operations.  Outstanding 
balances under these unsecured lines of credit at September 30, 1995, were
$7.0 million, an increase of $1.0 million from December 31, 1994.  Long-term 
debt , excluding the current portion, is $15.1 million at September 30, 1995.


                                     - 8 -
<PAGE>
                          PART II.  OTHER INFORMATION


Item 1.  Legal Proceedings

The Company's principal subsidiary, ACandS, Inc., is one of a number of 
defendants in pending lawsuits filed by approximately 86,000 individual 
claimants seeking damages for injuries allegedly caused by exposure to asbestos
fibers in insulation products used at one time by ACandS in its business.  
ACandS has defenses to these actions, including defenses based on the fact it is
primarily a contracting company in the business of installing products 
manufactured by others.  During the first three quarters of 1995, ACandS was
served with cases involving approximately 29,419 individual plaintiffs.  There 
wer 18,122 new plaintiffs in 1994; 20,542 new plaintiffs in 1993; 13,875 new 
plaintiffs in 1992; 10,090 new plaintiffs in 1991; and 13,214 new plaintiffs
in 1990.  Of the 1993 filings, over 4,000 were dismissed against ACandS
shortly after filing.  Based on the information currently available to it, 
ACandS beleives that the increased number of filings in 1995 is largely 
attributable to temporary factors, including efforts by plaintiffs to file 
claims before the effective date of tort reform statutes in Texas and other 
jurisdictions.

It is the pattern in this litigation for suits to be filed as the result of mass
screenings of individuals employed at a particular facility, through a 
particular union local, or by a particular employer.  It is ACandS's experience
that such suits are often filed with little investigation as to whether the 
claiment ever had any causative exposure to asbestos-containing products 
associated with the various named defendants.  As a result , historically, 
about half of the cases filed against ACandS have been closed without payment.

Cases pending against ACandS are now being handled by the Aetna Casualty and 
Surety Co. with the participation of other insurers that wrote coverage for 
ACandS.  Virtually all of ACandS's liability and defense costs for thes cases 
are being paid by Aetna and other insurance carriers.

Since the beginning of 1981, approximately 84,000 individual claims against 
ACandS have been settled, dismissed or otherwise resolved.  Although payments in
individual cases have varied considerably, ACandS's percentage of the 
aggregate liability payments for those cases has been small.  As a result, 
ACandS's average resolution cost for closed cases is very low.  The resolution 
cost per closed case in recent years has been consistent with long-term
averages.  Historically, payments on behalf of ACandS to resolve consolidated
proceedings in jurisdictions which have been difficult for all defendants have 
exceeded average costs.  ACandS anticipates that it will continue to face such 
proceedings in the future.


Beginning in the early 1980's, a number of companies who had been significant 
defendants in asbestos cases have filed for bankruptcy.  These companies are 
principally among the manufacturing defendants that traditionally have been the
principal targets in the litigation.  The large number of bankruptcy proceedings
involving former manufacturers of asbestos-containing products has significantly
reduced the number of viable defendants in many cases.  The bankruptcy of 
manufacturers whose products ACandS handled does pose increased risks to ACandS
in certain cases.  However, the bankruptcies to date have not significantly
increased the cost of resolving cases, and ACandS does not expect that they   
will do so.



                                     - 9 -
<PAGE>
                           PART II.  OTHER INFORMATION


Item 1.  Legal Proceedings  (Continued)


On July 29, 1991, the Judicial Panel on Multidistrict Litigation ordered that 
all asbestos related bodily-injury cases pending in the Federal trial courts 
and not then in trial should be transferred to Judge Charles R. Weiner in the
United States District Court for the Eastern District of Pennsylvania for 
coordinated or consolidated pretrial proceedings.  These proceedings involved 
less than one-fourth of the cases then pending against ACandS.  Judge Weiner
has expressed a desire to achieve a global, or comprehensive, resolution
of the asbestos-related bodily injury cases in these proceedings.  To date, 
however , the proceedings have achieved only the settlement of some 
individual actions and a portion of cases brought by selected plaintiffs'
counsel.  It is unclear how the Judicial Panel's order and the proceedings 
before Judge Weiner will ultimately affect the litigation of asbestos-related 
claims.

On January 15, 1993, certain plaintiffs' counsel and the members of the Center 
for Claims Resolution (an organization of 20 asbestos litigation defendants) 
filed a class action complaint, answer and settlement agreement involving all
previously unasserted claims by individuals who have been occupationally exposed
to asbestos fibers.  The action was filed in the United States District Court 
for the eastern district of Pennsylvania and was assigned to Judge Weiner as 
related to the Multidistrict Litigation proceedings.  Judge Weiner , in turn,
assigned certain aspects of the proceedings to Judge Lowell A. Reed.  In an 
order dated August 16, 1994, Judge Reed approved the settlement.  Judge Reed's 
approval remains subject to appeal.  Due to the complexity of the action and the
issues involved, it currently is uncertain what, if any, effect it will have 
on asbestos-related bodily injury litigation.

Although the large number of pending cases, the continued efforts of certain 
courts to clear dockets through consolidated or class proceedings, the 
bankruptcy filings by defendants, efforts toward national solutions, the 
transfer of federal cases to the United States District Court for the Eastern 
District of Pennsylvania, and the Center for Claims Resolution class action 
render prediction uncertain, ACandS expects that its percentage of liability
payments will continue to be relatively small.

ACandS has secured the commitment through final settlement agreements of a large
percentage of the very substantial insurance coverage applicable to its 
asbestos-related bodily injury claims.  ACandS believes it will secure 
significant additional coverage, if needed, from those insurers which have not 
to date settled with ACandS .

Given the number of currently pending cases and the rate of new filings, it is 
anticipated that the aggregate amount to be paid by all defendants  for 
asbestos-related bodily injury claims will be very large.  Nevertheless, as 
noted, ACandS's percentage of aggregate liability payments is expected to remain
small.  Management, therefore, believes that ACandS's insurance coverage is 
adequate to ensure that these actions will not have a material adverse effect
on the long-term business or financial position of the Company.  







                                     - 10 -
<PAGE>
                          PART II.  OTHER INFORMATION


Item 1.  Legal Proceedings  (Continued)


ACandS is also one of a number of defendants in eight actions by the owners of 
schools and other buildings seeking to recover costs associated with the 
replacement or treatment of installed asbestos-containing products. These cases 
involve school buildings, public buildings, and office buildings.  One of the 
cases is an alleged class action.

ACandS has substantial defenses to the actions, including defenses based upon 
the character of its operations and the fact that ACandS did not manufacture 
the asbestos-containing products involved.  Moreover, ACandS potentially has 
ACandS potentially has indemnification and/or contribution claims against the 
product manufacturers. To date, ACandS has been dismissed from 101 cases, 
largely on the basis it had no connection with the products at issue in the
claimants' buildings, and has agreed to settle 14 claims.  The aggregate amount
paid has been very small in the context of this litigation.  ACandS was not 
served with any new building-related case in the first three quarters of 1995.
Since 1990, only three new building related cases have been served on
ACandS.

ACandS's primary insurance carriers, the Aetna Casualty and Surety Co. and the 
Travelers Insurance Companies, are currently providing ACandS with a defense 
in these building cases, as well as paying settlements when necessary .
Travelers is providing coverage  pursuant to a settlement agreement, but Aetna
has asserted reservations of rights to later contest both the availability and 
the amount of coverage.  Aetna, nevertheless, continues to make its required 
payments.  

Decisions in litigation involving insurance coverage available for other 
defendants in asbestos building cases have thus far varied widely.  The 
appellate rulings which have fully considered coverage issues for asbestos
building claims to date provide significant coverage for policyholders.  The 
decisions are consistant with ACandS's view that the trend in the courts is 
to provide broad coverage for asbestos building cases.

Although the availability of coverage for existing and future suits is not 
resolved, and the aggregate potential loss from these suits may be significant, 
management believes that ACandS's defenses, potential indemnification and/or
contribution rights and insurance coverage are adequate to ensure that these 
actions will not have a material adverse effect on the long-term business or 
financial position of the Company.

From time to time, the Company and its subsidiaries are also parties as both 
plaintiff and defendant to various claims and litigation arising in  the 
normal course of business, including claims concerning work performed under
various contracts.  In the opinion of management, the outcome of such claims and
litigation will not materially affect the Company's long-term business, 
financial position or results of operations.



                                     - 11 -
<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.


                                             IREX CORPORATION



Date     November 14, 1995                      J. P. Farrell          
                                                J. P. Farrell
                                                 Controller
                                             Duly Authorized Signer



                                     - 12 -
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