September 25, 1998



VIA EDGAR

Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, DC 20549

RE:  Cucos Inc. - Commission File No. 0-12701

Gentlemen:

On behalf of Cucos Inc. (the "Company"), there follows herewith
for filing the Company's Annual Report on Form 10-KSB for the
fiscal year ended June 28, 1998, with exhibits.

Very truly yours,

CUCOS INC.


Vincent J. Liuzza, Jr.
Chairman
                                
               SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C. 20549
                                
                           FORM 10-KSB
       (Mark   
       One)
               
        /X/       Annual Report under Section 13 or 15(d) of the
                  Securities Exchange Act of 1934 (Fee Required)
                     for the fiscal year ended June 28, 1998
                                     
       /  /     Transition report under Section 13 or 15(d) of the
                Securities Exchange Act of 1934 (No Fee Required)
                  for the transition period from ____________ to
                                   ___________

Commission file number 0-12701
                           CUCOS INC.
      (Exact name of Small Business Issuer in its charter)
                                
                    Louisiana                         72-0915435
         (State or other jurisdiction of           (I.R.S. Employer
          incorporation or organization)          Identification No.)

          110 Veterans Blvd., Suite 222                  70005
               Metairie, Louisiana                    (Zip Code)
     (Address of principal executive offices)              

           Issuer's telephone number:  (504) 835-0306
   Securities registered under Section 12(b) of the Act:  None
      Securities registered under Section 12(g) of the Act:
                   Common Stock, no par value
                        (Title of Class)
                                
      Check whether the Issuer (1) filed all reports required  to
be  filed  by Section 13 or 15(d) of the Securities Exchange  Act
during  the past 12 months (or for such shorter period  that  the
Issuer  was  required to file such reports),  and  (2)  has  been
subject  to such filing requirements for the past 90 days.    Yes
X     No

      Check  if  there is no disclosure of delinquent  filers  in
response  to Item 405 of Regulation S-B contained in  this  form,
and  no  disclosure will be contained, to the  best  of  issuer's
knowledge,   in   definitive  proxy  or  information   statements
incorporated by reference in Part III of this Form 10-KSB or  any
amendment to this Form 10-KSB. /X/

Issuer's revenues for its most recent fiscal year:  $21,162,000

      Aggregate market value (based on the average bid and  asked
prices  in the over the-counter market) of the voting stock  held
by  non-affiliates  of the Registrant as of September  25,  1998:
approximately $2,411,000.

     Number of shares outstanding of each of the Issuer's Classes
of  common  stock as of September 25, 1998: 2,651,730  shares  of
Common Stock, no par value.

              Documents Incorporated By Reference.
                                
      Portions  of  the definitive Proxy Statement for  the  1998
Annual  Meeting of Shareholders (the "1998 Proxy Statement")  are
incorporated by reference into Part III.

                          INTRODUCTORY

      Definitions.  Except where the context indicated otherwise,
the  following terms have the following respective meanings  when
used  in  this Annual Report:  the "Registrant" means Cucos  Inc.
and  the  "Fiscal Year" means the 52 weeks ended June  28,  1998,
which is the year for which this Annual Report is filed.

      Presentation  and Dates of Information.  The  Item  numbers
appearing  in  this Annual Report correspond with those  used  in
Securities  and  Exchange Commission Form  10-KSB  (and,  to  the
extent that it is incorporated into Form 10-KSB, the letters used
in  the  Commission's Regulation S-B) as effective  on  the  date
hereof,  which specifies the information required to be  included
in  Annual  Reports to the Commission.  The information contained
in  this Annual Report is, unless indicated to be given as  of  a
specified  date or for a specified period, given as of  September
25,  1998.   In  computing  the aggregate  market  value  of  the
Registrant's voting stock held by non-affiliates disclosed on the
cover page to this Annual Report, the following stockholders were
treated  as affiliates:  all executive officers and directors  of
the   Registrant;  any  person  owning  more  than  10%  of   the
Registrant's Common Stock.

                                
                             PART I

Item 1.        Business

           The  Registrant, which was organized in March 1981  by
Vincent J. Liuzza, Jr., Chairman of the Board and Chief Executive
Officer  of  the  Registrant, and other  members  of  the  Liuzza
family,  operates and franchises full-service restaurants serving
moderately  priced  Sonoran and Tex-Mex  Mexican  appetizers  and
entrees  and complementary alcoholic beverages.  The first  Cucos
restaurant opened in a suburb of New Orleans (Metairie)  in  June
1981.   At fiscal year end on June 28, 1998, 20 restaurants  were
operating  under  the Cucos name, 15 of which are  owned  by  the
Registrant  and  5 by franchisees.  During 1998,  two  franchised
restaurants  were  closed  and one company-owned  restaurant  was
closed  and  the  property  sold.  There  were  twenty-two  total
restaurants in operation at the end of fiscal 1997.  In  October,
1997,   the   Company  opened  a  new  restaurant  in   Meridian,
Mississippi.

REGISTRANT-OWNED RESTAURANTS

           General.   Cucos Mexican Restaurants are full  service
restaurants  serving  fresh great tasting  Mexican  cuisine  that
offer only the best quality and taste.  It Tastes Better Our Way!
It  really  does, and there are lots of reasons  why.   Like  our
vegetables.  We use only the finest and freshest available,  such
as  Haas  avocados  for our made from scratch guacamole  that  we
prepare  fresh every day.  We only use fresh, lean  hand  trimmed
choice sirloin and absolutely fresh chicken.  Then there are  the
other shortcuts that we simply won't take.  For example, we  only
use  real  Monterey Jack and Cheddar cheeses and real dairy  sour
cream.   No  imitations.  No substitutions.  Just like it  should
be.   In  fact,  everything that comes  out  of  our  kitchen  is
meticulously  prepared  according to our own  very  secret,  very
special  recipes.  Some of our dishes take hours.   All  of  them
take  effort.  But we don't mind.  Because it tastes  better  our
way!

           We  serve a variety of traditional Mexican dishes  and
appetizers  such  as  our  sizzling  steak,  chicken,  or  shrimp
Fajitas,  Burritos,  Enchiladas, Tamales, and  Chimichangas.   We
also  serve several huge combination dinners.  We have  CucosLite
items  offering items with reduced fat, calories, and cholesterol
without sacrificing taste.  We have delicious Vegetarian items as
well  as  the biggest and best Burger in town.  Let's not  forget
our  famous award winning margaritas.  Cucos' margarita was voted
best Margarita in New Orleans three years in a row.  We were also
Best  Mexican  Restaurant in New Orleans by the  readers  of  New
Orleans Magazine.

           We offer a seasonal menu which changes quarterly.  Our
seasonal  menus feature such items as steak, crawfish enchiladas,
Creole Mex dishes, and our delicious Vegetarian Fajitas.

          Our restaurants are decorated with Mexican antiques and
furniture,  terra-cotta  tile  and hand  painted  large  colorful
murals  which are unique to each Cucos restaurant.   Our  Mexican
pottery, southwestern plants, colorful hand made Mexican  flowers
and  festive  lighting  add more Mexican touches  to  our  casual
restaurants.  During the past fiscal year, we have added colorful
new  Fiesta plateware and serving dishes as well as a new  Cucos'
cactus margarita glass.

          Food sales account for approximately 76% of revenues at
the fifteen Registrant-owned restaurants operated in fiscal 1998,
with  alcoholic  and  other beverages representing  approximately
20%.   Special Luncheon menu items range in price from  $3.99  to
$6.45.  The prices of the specialty and combination dinner  items
range  from  $5.45  to  $9.95.  The  per  person  average  check,
including  beverage, for fiscal 1998 was $9.90  and  the  average
dining time per table was approximately 45 minutes.

           As a result of the continuing decline in guest counts,
the   Registrant  undertook  a  comprehensive   review   of   its
operations.   It  was decided that the intense emphasis  on  cost
reductions  of  the  last  three  years  had  impacted  the  food
presentation and the guest experiences resulting in a decline  in
guest satisfaction.  As a result, it was determined that a change
in  philosophy to focus on customer satisfaction was  needed  and
the  President  was  asked  to  resign.   A  new  Executive  Vice
President   was  hired  to  be  in  charge  of  operations,   and
supervisory  responsibilities were restructured.  His  experience
was with a leading national restaurant concept that placed a high
emphasis   on   customer  satisfaction  and  food   presentation.
Consequently, beginning in late fiscal year 1998, the  Registrant
began  several new programs which are gradually being implemented
in  the  restaurants and should be completely  installed  by  the
second  quarter  of  fiscal year 1999.   The  keystone  of  these
programs   is   to  place  more  responsibility  for   restaurant
operations  with the restaurant general managers by  implementing
the  "GM Empowerment Program".  This change should accelerate the
growth,   development,  and  effectiveness  of   the   restaurant
managers,   which  should  also  enable  them  to  require   less
supervision.  One program is to restore the use  of  garnishments
and to improve the presentation of the food.  Another program  is
to implement the use of new uniforms and redesigned menus.  Also,
the  Registrant added a full time key employee to each restaurant
to  assume  certain duties of the manager to enable  the  him  to
focus more directly on guest satisfaction during meal periods.  A
price  increase of 3% was instituted and a new seasonal menu  was
added.   This  was the first price increase in over three  years,
but   the  prices  still  remain  competitive.   Finally,  a  new
advertising campaign was developed to emphasize the concept  that
the  Registrant provides the "Best Mex", because it has the  best
tasting,  most  flavorful  food served  in  a  friendly,  festive
atmosphere.   All  of these changes are intended to  re-establish
the  Registrant's image with a consistent theme.  In fiscal 1999,
the costs of these programs may exceed $400,000, and there is  no
assurance  that  these  changes will increase  guest  counts  and
thereby  restaurant sales.  Consequently, restaurant profits  may
be adversely affected.

          Restaurant Management and Supervision.  Each restaurant
is   operated  in  accordance  with  uniform  standards  set   by
management  relating to the preparation and service of  food  and
drink,  appearance and conduct of employees, and  cleanliness  of
facilities.   Food and beverage products are periodically  tested
for  quality and uniformity of portions.  In accordance with  the
Registrant's  standards, each restaurant  is  run  by  a  general
manager,  assisted  by  two managers,  a  kitchen  supervisor,  a
service supervisor and a bar supervisor.  At least one manager is
on  duty  during  all  serving  periods.   Each  of  Registrant's
restaurant  general managers receives, in addition to  a  salary,
incentive  compensation calculated as a percentage of  sales  and
profits in excess of a predetermined base level.

           The Registrant's long-term expansion plans require  it
to  develop  additional trained general managers.  The Registrant
requires  candidates for general manager to  undergo  a  thorough
training program designed to familiarize them with all aspects of
the  Registrant's operations.  A candidate serves as an assistant
manager before becoming a general manager.  Persons selected  for
training as general managers normally have several years of  food
service experience.

           Expansion  Program.   During  fiscal  year  1999,  the
Registrant  will  consider acquisition  of  sites  as  they  come
available.  Management intends that the primary growth  in  sales
for  fiscal  1999 be accomplished by increasing comparable  sales
per restaurant through a continuation of existing advertising and
programs to enhance customer satisfaction.

           The  Registrant is planning for expansion of the Cucos
system over the long-term.  In this connection, the Registrant is
currently  studying the population densities,  traffic  patterns,
income  levels,  competition and comparative cost structures  for
other suitable sites.

           The ability of the Registrant to open a new restaurant
will  depend on locating satisfactory sites, the availability  of
bank  and  lease financing at acceptable terms, having sufficient
working capital, obtaining adequate property, casualty and liquor
liability  insurance  coverages at a  reasonable  cost,  securing
appropriate local government permits, licenses and approvals, and
on  the capacity of the Registrant to supervise construction  and
to  recruit  and  train management personnel.  Such  factors  may
cause a delay in the Registrant's planned development schedule.

           The  Registrant believes that its development plan  of
controlled  growth will occur in the Southeastern United  States.
The  Registrant  expects in most cases to locate Registrant-owned
and franchised restaurants in high traffic, high growth areas  of
commercial  or  residential concentration, at  or  near  shopping
centers.   Registrant-owned and franchised restaurant sites  will
be  judged  by  the  Registrant's  executive  management  against
certain criteria as to population density, income levels,  amount
of competition, ingress/egress and traffic patterns.

           The  Registrant believes that there are  a  number  of
existing  restaurant facilities which have either closed  or  are
currently   operating  at  a  loss  or  at  marginal  levels   of
profitability.   The Registrant believes that a number  of  these
units  may  be suitable for conversion to a Cucos restaurant  and
can   be   leased  or  purchased  at  attractive   prices.    The
Registrant's  strategy  for  expansion  (with  respect  to   both
Registrant-owned  and  franchised  restaurants),  therefore,   is
primarily to locate units of this type rather than to follow  the
strategy of most specialty restaurant chains, which has  been  to
construct  new restaurant facilities on land owned or  leased  by
the  chain or to enter build-to-suit arrangements under which new
facilities  are  built to the specifications of  the  chain.   In
addition  to the economic benefits of the Registrant's  strategy,
such strategy may substantially reduce the delay between the site
selection  and the opening of a new restaurant and may allow  the
Registrant  to  gain  entry into densely-populated  suburban  and
urban  markets  in  which land is either not  available  for  the
construction   of   new   restaurants  or,   if   available,   is
prohibitively  expensive.   The Registrant's  expansion  strategy
may,  however, subject it to the same adverse factors that caused
the existing facility to operate marginally or unprofitably prior
to being converted to a Cucos restaurant.  The Registrant intends
to combat these adverse factors by providing food and service, in
renovated facilities, that will appeal to the available  customer
base.

           The  Registrant estimates that the initial  investment
that  will be required in leasing an existing restaurant facility
and  converting it for operation as a Registrant-owned restaurant
will  be  between  $550,000 and $740,000.   A  new  (rather  than
existing)  leased  facility  could involve  substantially  higher
costs for leasehold improvements.

           When a new Registrant-owned restaurant is opened,  the
Registrant temporarily transfers experienced personnel  from  one
or more of its existing restaurants to the new restaurant.  Prior
to  opening,  personnel  at  the new location  undergo  intensive
training, which includes several pre-opening events at which test
meals are served.

           The success of the Registrant's expansion program will
depend on, among other factors, capital availability, whether the
Registrant  is  able to attract and retain sufficient  qualified,
experienced   managers  and  assistant  managers,   and   whether
management  will  be  able  to ensure that  Registrant-owned  and
franchise restaurants operate in accordance with the Registrant's
standards.

            Purchasing.   Management  believes  that  centralized
purchasing  is  advantageous to the Registrant  in  that  it  has
allowed it to take advantage of certain volume discounts.   Fresh
produce, beverages and certain other items are purchased by  each
Registrant-owned   restaurant  from   local   wholesalers.    The
Registrant believes that satisfactory local sources of supply are
generally available for all of the other items it regularly  uses
in its restaurants.

           Insurance.  Insurance costs have risen considerably in
the  restaurant  business, especially for those restaurants  with
liquor  licenses.   The  Registrant  carries  fire  and  casualty
insurance  on  its  Registrant-owned  restaurants  and  liability
insurance in amounts which management feels is adequate  for  its
operations.

           Marketing.   The  Registrant advertises  primarily  by
television  advertising.   Its  advertising  promotes  the   name
"Cucos"  and  emphasizes quality dining using  tasty  food  in  a
festive  atmosphere at moderate prices.  Periodically, print  and
radio advertising are also used.

FRANCHISED RESTAURANTS

           At  the  present time, the Registrant is not  actively
seeking  franchisees, but should the opportunity arise, it  would
offer  a franchise on a very selective basis.  No assurances  can
be  given  as to the number of franchise development  areas  that
will  be  sold  during  the fiscal year 1999  or  the  impact  of
development fee revenues upon the Registrant's profitability  and
cash position during fiscal year 1999.

           The  development  agreements  generally  obligate  the
developer  to  construct a specified number of Cucos  restaurants
within the licensed territory.  The restaurants may be either new
restaurants or conversions of existing restaurants, although  the
Registrant encourages franchisees to convert existing restaurants
whenever  possible (see "Expansion Program").  A  developer  must
open  new  Cucos restaurants within the development territory  in
accordance  with  the  schedule  set  forth  in  the  development
agreement.    If  a  developer  fails  to  open  restaurants   in
accordance with the schedule, generally the Registrant may notify
the  developer  that  it  is  in default  under  the  development
agreement  and may terminate the agreement 30 days thereafter  if
the default has not been cured.

           Generally, a development agreement expires three years
after  the  latest  date  set forth in the development  schedule.
During  the  first  year after completion of  the  schedule,  the
Registrant  is prohibited from either opening a Cucos  restaurant
or  granting  a franchise to someone other than the developer  to
establish  a Cucos restaurant within the licensed territory.   If
during  the  second  and third year after the completion  of  the
schedule,   the   Registrant  desires  to  establish   additional
restaurants within the licensed territory, the developer for that
area  has  a  right  of  first refusal to enter  into  additional
development   agreements   with  respect   to   such   additional
restaurants  so long as the developer is in compliance  with  the
then  existing development agreement.  If the developer exercises
its  right of first refusal, the developer is required to pay the
fees  for  each restaurant then being charged to new  developers.
Upon expiration of the development agreement, the Registrant  may
open  Registrant-owned  restaurants in  the  previously  licensed
territory or grant franchises to other persons to open additional
franchised restaurants in the previously licensed territory.

           Development agreements provide for the payment  of  an
initial  nonrefundable  development fee  by  the  developer  upon
execution of the agreement.  The development fee with respect  to
development agreements is generally $15,000 per restaurant up  to
five  restaurants  and  $10,000 per restaurant  thereafter.   The
Registrant  anticipates that the amount of  the  development  fee
with  respect to future development agreements will be based upon
the  size  and  nature  of the area covered  by  the  development
agreement.

           Prior to the acquisition of a site for a restaurant in
the   licensed  territory,  the  developer  must  submit  to  the
Registrant  certain information concerning the site  and  certain
market information.  Upon the Registrant's approval of the  site,
the  developer is required to enter into a license agreement with
the  Registrant  with respect to the restaurant to  be  developed
under the development agreement.

          The license agreements generally have terms of 20 years
from  the  date  of  their execution.  However,  if  the  license
agreement pertains to a franchised restaurant that is leased, the
license  agreement terminates upon the earlier of 20  years  from
the  commencement  date of the lease or upon the  termination  or
expiration of the primary term of the lease, plus any options  to
renew the lease.

           Generally  franchisees  are required  to  pay  to  the
Registrant  under the license agreement a continuing royalty  fee
equal  to  4% of gross revenues at the restaurant.  In  addition,
franchisees are required to pay a continuing monthly contribution
to  an  advertising materials fund equal to .5% of gross revenues
at  the  restaurant  and  if a national  advertising  fund  or  a
regional  advertising fund applicable to the franchisee's  region
is  established by the Registrant (the Registrant has not done so
to  date),  the  franchisees  must also  pay  to  the  Registrant
continuing monthly contributions, for use by such funds, equal to
amounts  not  to  exceed  1%  and 2% of  gross  revenues  of  the
restaurant,  respectively, for the national  media  fund  or  the
regional  advertising  fund  in  the  franchisee's  region.   The
Registrant has not established a national or regional advertising
fund  and  accordingly  has not required contributions  for  such
funds.

           The  license  agreement provides that the  franchisees
will   comply   strictly   with   the   Registrant's   standards,
specifications,    processes,   procedures,   requirements    and
instructions   regarding  the  operation  of   the   franchisee's
restaurant.   The  Registrant  is obligated  to  provide  initial
training programs for franchisees and to provide personnel for on-
site  assistance  in  opening  each franchised  restaurant.   The
Registrant has the right to approve the person designated by  the
franchisee  to have overall supervisory authority over franchised
restaurant  operations or, if no such overall operations  manager
is designed, to approve each restaurant general manager.

           Franchisees  purchase  food  products  and  restaurant
supplies   conforming   to   Registrant's   specifications   from
independent  suppliers.  Alternate sources  of  these  items  are
generally  readily available.  The Registrant may sell equipment,
food  or supplies to franchisees upon request, but otherwise does
not  intend to do so.  The Registrant continues to sell  a  small
amount  of  proprietary  advertising materials  and  confidential
recipe  spice  packs to franchisees.  The Registrant  anticipates
continuing these sales.

EMPLOYEES

           At  June  28,  1998, the Registrant-owned  restaurants
employed  approximately 784 part-time and full-time  persons,  of
which  58  were managers and assistant managers, all of whom  are
full-time.   In  addition,  23  persons  were  employed  at   the
Registrant's  executive  office.   The  Registrant  endeavors  to
control  its employee turnover rate by offering to all  full-time
restaurant  employees  certain  paid  benefits,  including   life
insurance,   health  insurance  and  vacation.    None   of   the
Registrant's  employees are represented by a  labor  union.   The
Registrant  has  experienced no work  stoppages  attributable  to
labor  disputes  and  considers  its  employee  relations  to  be
satisfactory.

COMPETITION

           The  restaurant business is highly competitive and  is
often  affected by changes in taste and eating habits,  by  local
and  national economic conditions affecting spending habits,  and
by population and traffic patterns.  The Registrant believes that
the quality and price of food products are the principal means of
competition  in the restaurant industry.  Also of importance  are
site  locations,  quality  and  speed  of  service,  cleanliness,
advertising and attractiveness of facilities.

           The  Registrant competes with several national  chains
including  El  Patio,  Chili's,  Applebees,  Olive  Garden,   and
LaFiesta, as well as, several local dining concepts.  Several  of
the  national  chains  have  had  significant  funding  available
provided  by  public stock offerings, which has enabled  them  to
expand significantly in the Registrant's smaller markets.   These
expansions have adversely impacted the Registrant's guest  counts
in  the smaller markets.  These national chains, as well as  some
regional  chains,  operate  more  restaurants  and  have  greater
financial  resources  and  greater  name  recognition  than   the
Registrant.  In addition, gaming operations often offer  food  at
discounted  or  below cost prices which provide a  new  level  of
indirect   competition   in   the  Registrant's   Louisiana   and
Mississippi markets.

GOVERNMENT REGULATION

           The Registrant's franchise operations are subject to a
variety  of laws regulating the marketing of franchises.  Federal
Trade    Commission   regulations   impose   certain   disclosure
requirements  on  persons  engaged in the  business  of  offering
franchises.   States  in which the Registrant  offers  franchises
also may have franchising laws that require registration prior to
the  offering  of  franchises for sale in those  states  or  that
afford  franchisees  substantive rights, including  limiting  the
circumstances under which franchises may be terminated.

           The  Registrant  is also subject  to  the  Fair  Labor
Standards  Act,  which  governs such matters  as  minimum  wages,
overtime, and other working conditions.  Many of the Registrant's
food  service personnel are paid at rates related to the  minimum
wage and, accordingly, increases in the minimum wage increase the
Registrant's labor costs.

           Each  of  the Registrant's restaurants is  subject  to
licensing and regulation by state liquor control boards  and  the
state  police in Louisiana (with respect to video poker), and  by
municipal   health,  sanitation,  safety  and   fire   department
agencies.   The  Registrant expects that liquor sales  and  video
poker  revenues  will account for a significant  portion  of  the
Registrant's revenues.  During 1998 liquor sales and video  poker
revenues  accounted for about 2.4% and 3.1% of food and  beverage
revenues, respectively.

           During  fiscal 1996, the State of Louisiana  passed  a
local  option ordinance on all forms of gambling including  video
poker.   In  November,  1996, all parishes  in  the  state  voted
whether  to  retain  video  poker and other  forms  of  gambling.
Voters in four parishes in which the Registrant operates voted to
end  video poker and other forms of gambling.  The ban  on  video
poker  at  these locations will be effective in fiscal 2000.   In
1998  the  Registrant  recorded video  poker  revenues  at  these
locations of 1.6% of sales of food and beverages. Legislation was
considered in the current session of the Louisiana Legislature to
further  restrict video poker activities.  This  legislation  was
defeated  in  this session; however, future legislative  sessions
may   consider  legislation  that  might  adversely  impact   the
Registrant's remaining video poker activities.

           The  loss of an existing liquor license or video poker
license  or  the  inability to obtain a  liquor  or  video  poker
license   at   a  new  restaurant  would  adversely  affect   the
Registrant's operations at that restaurant.

           The  Registrant is also subject to the  provisions  of
Americans  with Disabilities Act.  The Registrant  has  remodeled
its restaurants to meet these requirements where necessary.

MISCELLANEOUS

           Customers.   No  material  part  of  the  Registrant's
business  is  dependent upon a single customer,  or  a  very  few
customers,  the  loss of any one of which would have  a  material
adverse  effect  on the Registrant.  No single customer  accounts
for as much as 10% of the Registrant's total revenues.

           Seasonality.  The Registrant's results are impacted by
seasonality.   Usually the highest sales periods  occur  in  late
Spring  and Summer, with sales declining in the Fall and  Winter.
This  is  especially  true for the Gulf Coast  restaurants  where
sales are more dependent on tourism.

            Service   Marks,  Trademarks  and  Copyrights.    The
Registrant   is   the  owner  of  United  States   Service   Mark
Registrations  Nos. 1,509,612, dated October 18,  1988,  for  the
mark CUCOS and Design; 1,733,801 dated November 17, 1992, for the
mark  CUCOS BORDER CAFE and DESIGN; and 1,941,214, dated December
12,  1995,  for  the  mark  CUCOS MEXICAN  CAFE  &  DESIGN.   The
Registrant   is  also  the  owner  of  United  States   Trademark
Registrations Nos. 1,405,169, dated August 12, 1986, for the mark
FRESH-ITAS  (Cucos'  version  of fajitas)  and  1,465,729,  dated
November 17, 1987, for the mark FRESH-ITA NACHOS (Cucos'  version
of  fajita  nachos).  The Registrant is also the owner of  United
States Service Mark Registration No. 1,996,748, dated August  27,
1996,  for  the  mark THE TASTE TO MAKE YOU SAY OLE`  and  United
States  Service Mark Registration No. 2,019,308, issued  November
27,  1996,  for  the  mark  IT  TASTES  BETTER  OUR  WAY.   Those
registrations  which issued prior to November 16, 1989,  have  an
effective term of 20 years and those issued on or after  November
16,  1989,  have  an  effective term of 10 years,  unless  sooner
terminated by law, and all may be renewed for successive terms so
long as the marks continue to be used by Registrant in interstate
commerce  for  the specified services or goods.   The  Registrant
also  owns a service mark registration as issued by the State  of
Louisiana,  dated July 14, 1987; a Tennessee State  Registration,
issued  July  2, 1987; a Florida State Registration No.  707,637,
dated  July 17, 1987; an Alabama State Registration No.  103,383,
issued  July  14,  1987;  a Mississippi  State  Registration  No.
1,509,612,  issued  on  July  27, 1987;  and  an  Arkansas  State
Registration No. 181-87, issued on July 8, 1987. for the  service
mark CU-CO's.  These registrations are effective for a term of 10
years  and  may be renewed for successive terms.   All  of  these
registrations are valid and subsisting.  In addition,  Registrant
is  the  owner of Copyright Registration No. TXU 357-784 for  the
Cucos  Power Manual and Copyright Registration No. PAU  1,195,506
for the Video, both dated November 4, 1988.

Item 2.        Properties.

           The  following  table summarizes  certain  information
concerning  Registrant-owned restaurants  located  in  facilities
that are leased from others as of September 1, 1998.

                                                                   Lease
                                     Size       Dining   Lease   Option(s)
Location         Opened/Acquired   (Sq. Ft.)   Capacity Expires   Through
New Orleans -                                                         
 Metairie        June 1981           5138        136      2007      2027
Biloxi, MS       April 1982          5600        159      2002      2032
New Orleans -                                                         
 Westbank        September 1983      4800        147      2001      2010
Monroe, LA       June 1984           4476        146      1999      2019
Slidell, LA      November 1984       5300        139      2008      2018
Alexandria, LA   March 1985          5125        143      2000      2015
New Orleans -                                                         
 Uptown          November 1985       4539        120      2000      2015
Pascagoula, MS   December 1989       5160        130      2011      2021
Hammond, LA      July 1990           6062        130      2001      None
Birmingham, AL   March 1992          4560        150      2006      2012
Houma, LA        September 1992      6000        148      2007      2017
Birmingham, AL   February 1993       5000        160      2006      2026
Montgomery, AL   February 1993       5100        170      2002      2012
Ruston, LA       February 1996       5476        162      2003      2026
Meridian, MS     October 1998        5374        221      2007      2017

          The New Orleans-Westbank location, the Slidell location
and  the second Birmingham and Montgomery, Alabama, locations are
in strip shopping centers.  The Hammond, first Birmingham, Houma,
and  Meridian  locations  are in shopping  malls.   Seven  leased
locations  are  free-standing buildings.  The  restaurant  leases
require  the  Registrant to pay real estate taxes, insurance  and
utilities,  and  to bear repair, maintenance and  other  expenses
normally borne by the lessee under a triple net lease.

           In  addition  to the leases above, the Registrant  has
leases on three restaurant properties that are no longer used  in
its  operations.   The properties have been  subleased  to  other
companies.

Location                  Lease Expires      Sublease Expires
Columbus, GA                  2004                 2004
Cutler Ridge, FL              2005                 2005
Macon, GA                     2011                 2011

Item 3.        Legal Proceedings.

           On  April  11,  1990, a franchisee filed  a  complaint
against  the  Registrant  and certain of  its  officers  alleging
breach  of  contract and misrepresentation and seeks  damages  in
excess  of  $1.6  million.  There has been no  activity  in  this
litigation  for  more  than seven years except  for  a  discovery
request filed in January, 1997, which avoided a dismissal of  the
litigation  for  non-prosecution.  The  Registrant  believes  the
claims are without merit and the likelihood of a loss is remote.

           A  contractor  built a restaurant  for  a  franchisee,
L.B.G., Inc.  The contractor was not paid by L.B.G., Inc. and the
contractor  has sued the Registrant for $65,000.  The  Registrant
believes  the claim against it is without merit and  it  is  more
probable than not that it will prevail in this matter.

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

          No matters were submitted to a vote of the Registrant's
security   holders,  through  the  solicitation  of  proxies   or
otherwise, during the fourth quarter of the Fiscal Year.


                                
                             PART II

Item 5.   Market for the Registrant's Common Stock and Related
          Shareholder Matters.

                     Cucos Inc. - Stock Data

     The Registrant's common stock is traded on The NASDAQ Small-
Cap  Market under the symbol CUCO. The following table sets forth
the  range of the high and low bid and ask prices for each of the
quarters indicated for fiscal 1998 and fiscal 1997.
 
Fiscal 1997                       High Bid-Ask       Low Bid-Ask
1st Quarter ended 10/19/96        1 3/8 - 1 5/8      1 1/4-1 1/4
2nd Quarter ended 1/11/97          1 1/2-1 5/8       1 1/8-1 1/4
3rd Quarter ended 4/5/97           1 3/8-1 5/8      1 1/4-1 5/16
4th Quarter ended 6/29/97          1 3/8-1 1/2      1 3/16-1 1/4
                                                          
Fiscal 1998                       High Bid-Ask       Low Bid-Ask
1st Quarter ended 10/19/97        1 1/2 - 1 7/8     1 1/8 - 1 1/4
2nd Quarter ended 1/11/98         1 1/4 - 1 1/2     1 1/8 - 1/3/8
3rd Quarter ended 4/5/98              1 1/4         23/32 - 1/1/8
4th Quarter ended 6/28/98               1              3/4 - 1

      On  September 17, 1998, the closing bid and ask prices  for
the Registrant's common stock were 1 3/8 bid and 1 3/8 ask.

       The  foregoing  quotations  reflect  inter-dealer  prices,
without  retail  markup,  mark-down or  commission  and  may  not
necessarily represent actual transactions.

      Since becoming a public company, the Registrant has paid no
cash  dividends and has no present intention of paying dividends,
but  rather  will  retain  its  earnings  to  provide  funds  for
expansion of its business and other corporate purposes.

      Approximate  number  of shareholders (including  beneficial
shareholders  through nominee registration) as of  September  15,
1998:  825.  Market makers: Herzog, Heine, Geduld, Inc.,  Paragon
Capital Corp. and Morgan, Keegan & Company.

Item 6.        Management's Discussion and Analysis or Plan of
               Operation.

1998 Compared to 1997

      Sales  of  Food and Beverages declined $302,000  (1.4%)  to
$21,162,000 from $21,464,000.  This decrease was due  to  a  4.7%
decline  in  existing  restaurant sales  resulting  from  a  6.0%
decline  in weekly guest counts at comparable restaurants.   This
decrease in sales occurred primarily in the Registrant's  smaller
markets  and  was  partially  offset  by  the  opening   of   the
Registrant's restaurant in Meridian, Mississippi.

      Commissary  and Other Income increased $33,000 to  $173,000
from $140,000, primarily resulting from the sale of a restaurant.

      Cost of Sales decreased $146,000 (2.9%) to $5,591,000  from
$5,737,000.   This decrease is primarily due to  the  decline  in
sales of food and beverages discussed above.

      Restaurant Labor and Benefits increased $186,000 (2.7%)  to
$7,091,000  from  $6,905,000.  This increase  resulted  from  the
increase  in minimum wage in September, 1997, and the opening  of
the  restaurant in Meridian, offset in part by a 2.0% decline  in
restaurant sales and benefit costs at existing restaurants.

      Other  Operating  Expenses  increased  $203,000  (5.0%)  to
$3,954,000  from  $3,751,000.  This increase  primarily  resulted
from the opening of the restaurant in Meridian.

      Occupancy  Costs increased $124,000 (5.6%)  to  $42,324,000
from  $2,200,000.  This increase was primarily due to the opening
of the restaurant in Meridian.

      Royalties and Franchise Revenues increased $43,000  due  to
the opening of a franchised restaurant in Des Moines, Iowa, and a
decline  in expenses as no new franchise restaurants were  opened
in 1998.

      Operations  Expenses decreased $88,000 (8.3%)  to  $968,000
from  $1,056,000, which primarily related to a decrease in  costs
related  to  subleased restaurant facilities which was  partially
offset by an increase in costs related to hiring new employees.

      Corporate  Expenses increased $72,000 (4.9%) to  $1,533,000
from $1,461,000.  This was primarily the result of an increase in
workmen's  compensation costs and the write-off of deferred  site
costs related to locations no longer being considered as possible
restaurant  locations.  Due to revisions in  its  estimates,  the
Company  provided an additional $178,000 for charges  related  to
closed restaurants.

       Interest  Expense  increased  $64,000  to  $517,000   from
$453,000.  This increase was due to higher average borrowings and
amortization  of debt issuance costs offset in part  by  a  small
decline in the average overall borrowing interest rate.

      Because  of  lower  than  expected revenues  and  earnings,
management increased the valuation allowance for deferred  income
tax assets resulting in income tax expense of $107,000.

      On  October 26, 1997, the Company entered into a new credit
facility  with  a commercial lending institution.  In  connection
with  this refinancing, the Company incurred prepayment penalties
of  $162,000  which have been reported as an extraordinary  loss.
(See Liquidity and Capital Resources.)

Liquidity and Capital Resources

      In  1998  and  1997, despite net losses of  $1,064,000  and
$446,000,  the Company's operating activities provided cash  flow
of   $158,000   and  $881,000,  respectively.    Management   has
implemented certain actions, which are described on page 4, in an
effort  to  improve operating results and cash flows.  Management
believes  it  will continue to generate cash flow from  operating
activities  sufficient to allow it to operate  and  to  meet  its
obligations.   Management  also  believes  there  are   alternate
sources of financing available to allow the Company to meet short-
term  financing needs which may arise.  However, there can be  no
assurance  that  management's plans will be  successful  or  that
alternate sources will be available.

      Working  capital needs have been and will  continue  to  be
financed  from  operations and short-term  borrowings.   Although
none is planned, restaurant expansion and remodeling has been and
will continue to be funded from long term debt, lessor allowances
and leases.  Because of the timing of securing long term debt and
leases,  restaurant expansion and remodeling may  be  temporarily
funded from operations.

     Net cash provided by operations decreased $723,000 from 1997
which primarily resulted from a decline in income from restaurant
operations.   Net  cash  provided  by  investing  activities  was
$195,000 in 1998 compared to cash used of $525,000 in 1997, or an
improvement  of $445,000 and primarily included the  purchase  of
property  and  equipment, offset by the  sale  of  the  Pensacola
property.  Net cash used in financing activities was $150,000  in
1998 and included principal payments on borrowings, debt issuance
costs  and  debt restructuring penalties which were substantially
offset by additional long-term borrowings.

      On  October 26, 1997, the Company entered into a new credit
facility  of  $3,590,000, with a commercial lending  institution.
This  new  credit facility consists of a term loan to be  repaid,
primarily,  in monthly payments over 10 years and is  secured  by
the restaurant operating properties.  The proceeds from this term
loan  has  been used to repay substantially all of  the  existing
long-term  debt  and  short-term  debt  payable  to  banks.    In
connection with this refinancing, the Company incurred  a  charge
to  earnings in the Second Quarter of $162,000 and is related  to
repayment penalties associated with the existing debt. This  loan
is  part  of a pool of loans financed by the lender.  A provision
of  this loan requires the Company to pay additional interest  if
certain  conditions of the loan pool are not met.  This provision
would  require the Company to pay additional interest each  month
if the loan pool conditions are not met.  These monthly payments,
if  required,  may increase the interest costs by  a  maximum  of
$400,000 over the life of the loan.  At year end, the Company had
paid no additional interest.

      The Company's line of credit provides $100,000 which may be
used  for  working capital needs as well as restaurant  expansion
and  remodeling.  The line of credit bears interest at  2.0%  per
annum  above the New York Prime Rate and had $100,000 outstanding
at June 28, 1998.

     In January 1998, the Board of Directors amended the terms of
the  Company's  debentures permitting immediate  conversion.   On
February   19,  1998,  the  debenture  holders  exercised   their
conversion  rights  and  converted the  debentures  into  527,983
shares of common stock.

Impact of Inflation and Changing Prices

      Inflation  in food, labor, construction costs and  interest
rates  can affect the CompanyOs operations. Many of the CompanyOs
employees are paid hourly rates related to the minimum wage.

      Management  reviews its pricing regularly to ensure  it  is
priced  competitively, that it offers outstanding  value  to  its
customers,  and that margins are maintained. Inflation  can  also
affect food costs, rent, taxes, maintenance, and insurance costs.

Seasonality

      The  Company's results are affected by seasonality. Usually
the  highest sales periods occur in late Spring and Summer,  with
sales  declining in the Fall and Winter. This is especially  true
for the Gulf Coast restaurants where sales are more dependent  on
tourism.

Forward-Looking Statements

      Forward-looking  statements regarding management's  present
plans  or  expectations  for new unit openings,  remodels,  other
capital  expenditures, the financing thereof, and disposition  of
impaired units involve risks and uncertainties relative to return
expectations  and related allocation of resources,  and  changing
economic or competitive conditions, as well as the negotiation of
agreements  with third parties, which could cause actual  results
to   differ  from  present  plans  or  expectations,   and   such
differences   could  be  material.   Similarly,   forward-looking
statements   regarding  management's  present  expectations   for
operating  results  involve  risk and uncertainties  relative  to
these  and  other factors, such as advertising effectiveness  and
the  ability  to achieve cost reductions, which also would  cause
actual  results  to differ from present plans.  Such  differences
could  be  material.  Management does not expect to  update  such
forward-looking statements continually as conditions change,  and
readers should consider that such statements speak only as to the
date hereof.

Impact of Year 2000

      Some  of the company's older computer programs were written
using  two digits rather than four to define the applicable year.
As a result, those computer programs have time-sensitive software
that recognize a date using "00" as the year 1900 rather than the
year  2000.  This could cause a system failure or miscalculations
causing disruptions of operations, including, among other things,
a  temporary inability to process transactions, send invoices, or
engage in similar normal business activities.

      The  Company has completed an assessment and will  have  to
modify  or replace hardware and software of its software so  that
its computer systems will function properly with respect to dates
in  the  year 2000 and thereafter.  In 1998, the Company replaced
substantially all of its restaurant point of sales systems.   The
new  systems  do not have any year 2000 issues.  The  total  Year
2000  project cost is estimated at approximately $50,000 for  the
purchase of new software and hardware that will be capitalized.

      The  project  is estimated to be completed not  later  than
December  31, 1999, which is prior to any anticipated  impact  on
its   operating   systems.   The  Company  believes   that   with
modifications  to  existing  software  and  conversions  to   new
software,   the  Year  2000  Issue  will  not  pose   significant
operational problems for its computer systems.  However, if  such
modifications and conversions are not made, or are not  completed
timely, the Year 2000 Issue could have a material impact  on  the
operations of the Company.

      The  costs of the project and the date on which the Company
believes  it will complete the Year 2000 modifications are  based
on  management's  best  estimates, which were  derived  utilizing
numerous  assumptions of future events, including  the  continued
availability  of  certain resources and other factors.   However,
there  can be no guarantee that these estimates will be  achieved
and   actual   results   could  differ  materially   from   those
anticipated.   Specific factors that might  cause  such  material
differences include, but are not limited to, the availability and
cost  of  personnel trained in this area and the availability  of
software and hardware.

      The  Company has initiated communications with all  of  its
significant  suppliers  to determine  the  extent  to  which  the
Company's  interface  systems  are  vulnerable  to  those   third
parties' failure to remediate their own Year 2000 Issues.   There
is  no guarantee that the systems of other companies on which the
Company's  systems rely will be timely converted  and  would  not
have an adverse effect on the Company's systems.

Item 7.        Financial Statements.
                   Balance Sheet - Cucos Inc.
                          June 28, 1998

Assets                                                                  
Current Assets                                                          
  Cash and Cash Equivalents                                     $679,000
  Receivables:                                                          
     Trade                                                       590,000
     Due from Affiliates                                         166,000
     Less Allowance for Doubtful Accounts                        257,000
                                                                 499,000
  Inventories                                                    233,000
  Prepaid Expenses                                               260,000
  Deferred Taxes and Other Current Assets                          5,000
     TOTAL CURRENT ASSETS                                      1,676,000
                                                                        
Deferred Taxes and Noncurrent Assets                             264,000
                                                                        
Property, Equipment and Other                                           
  Equipment                                                    3,774,000
  Leasehold Improvements                                       5,203,000
  Reacquired Franchise Rights                                    529,000
                                                               9,506,000
  Less Accumulated Depreciation and Amortization               4,412,000
                                                               5,094,000
                                                                          
Investment in LaMexiCo, L.L.C.                                   242,000
Deferred Costs, Less Accumulated Amortization of $130,000        397,000
                                                              $7,673,000
Liabilities and Shareholders' Equity                                    
Current Liabilities                                                     
  Short-Term Debt Payable to Banks                              $100,000
  Trade Accounts Payable                                       1,412,000
  Accrued Expenses and Other                                     572,000
  Accrued Payroll                                                215,000
  Current Portion of Long-Term Debt                              387,000
     TOTAL CURRENT LIABILITIES                                 2,686,000
                                                                        
Long-Term Debt, Less Current Portion                           3,452,000
Deferred Revenue and Other                                       262,000
                                                                        
Shareholders' Equity                                                    
  Preferred Stock, No Par Value-1,000,000                               
     Shares Authorized, None Issued or Outstanding                     -
  Common Stock, No Par Value - 20,000,000 Shares                        
     Authorized, 2,651,730 Shares Issued and Outstanding       5,253,000
  Additional Paid-in Capital                                     111,000
  Retained Earnings (Deficit)                                 (4,090,000)
     TOTAL SHAREHOLDERS' EQUITY                                1,273,000
                                                              $7,673,000
See notes to financial statements.

<TABLE>
              Statements of Operations - Cucos Inc.
                                
<CAPTION>
                                                              Fiscal Year Ended
                                                         June 28, 1998   June 29, 1997
                                                                           
<S>
Restaurant Operations                                     <C>             <C>               
  Sales of Food and Beverages                              $21,162,000     $21,464,000
  Restaurant Expenses:                                                                
     Cost of Sales                                           5,591,000       5,737,000
     Restaurant Labor and Benefits                           7,091,000       6,905,000
     Other Operating Expenses                                3,954,000       3,751,000
     Occupancy Costs                                         2,324,000       2,200,000
     Preopening Costs                                           87,000          97,000
       Total Restaurant Expenses                            19,047,000      18,690,000
Income From Restaurant Operations                            2,115,000       2,774,000
                                                                                      
Royalties and Franchise Revenues, net of                                              
     expenses of $23,000 and $96,000                           113,000          70,000
Commissary and Other Income                                    173,000         140,000
                                                             2,401,000       2,984,000
                                                                                      
Operations Supervision Expenses                                968,000       1,056,000
Corporate Expenses                                           1,533,000       1,461,000
Charges Related to Closed Units and Asset Impairment           178,000         460,000
Operating Income (Loss)                                       (278,000)          7,000
Interest Expense                                               517,000         453,000
Loss Before Income Taxes and Extraordinary Item               (795,000)       (446,000)
Income Taxes                                                   107,000               -
Loss Before Extraordinary Item                                (902,000)       (446,000)
Extraordinary Item - Debt Restructuring Penalties             (162,000)              -
Net Loss                                                   $(1,064,000)      $(446,000)
                                                                                      
Weighted Average Number of Common Shares and Common                                     
Share Equivalents Outstanding - Basic and Diluted            2,306,000       2,114,000
                                                                                      
Net Loss Per Share Before Extraordinary Items - Basic           ($0.39)         ($0.21)
      and Diluted
Extraordinary Item - Basic and Diluted                           $0.07            $  -
Net Loss Per Share - Basic and Diluted                          ($0.46)         ($0.21)
</TABLE>

See notes to financial statements.

<TABLE>
              Statements of Cash Flows - Cucos Inc.
<CAPTION>
                                
                                                                      Fiscal Year Ended
                                                                 June 28, 1998  June 29, 1997
Operating Activities                                                                         
                                                                                             
<S>                                                               <C>             <C>
Net Loss                                                           ($1,064,000)     ($446,000)
  Adjustments to Reconcile Net Loss to Net                                                   
     Cash Provided by Operating Activities:
       Deferred income Taxes                                           107,000              -
       Debt Restructuring Penalties                                    162,000              -
       Depreciation and Amortization                                   920,000      1,053,000
       Decrease in Deferred Revenue and Other                         (209,000)       (30,000)
       Gain on Sale of Assets and Other                               (187,000)             -
       Asset Impairment and Rent Reserve                               178,000        460,000
       Accretion of Discount on Convertible Debenture                   21,000         32,000
       Equity in Earnings of Equity Investee,                                                
          Net of Distributions of $44,000 and $17,000                   11,000         (8,000)
       Change in Operating Assets and Liabilities:                                           
          Receivables                                                  105,000        (54,000)
          Inventories                                                   21,000        (10,000)
          Prepaids and Other                                           141,000       (119,000)
          Deferred Costs                                                (5,000)       (16,000)
          Accounts Payable                                            (143,000)        78,000
          Accrued Expenses                                              88,000        (61,000)
          Accrued Payroll                                               12,000          2,000
  NET CASH PROVIDED BY OPERATING ACTIVITIES                            158,000        881,000
                                                                                             
Investing Activities                                                                         
                                                                                             
  Purchases of Property and Equipment                                 (639,000)      (525,000)
  Proceeds From Sale of Assets                                         834,000              -
  NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES                  195,000       (525,000)
                                                                                             
Financing Activities                                                                         
                                                                                             
  Change in Short-Term Debt Payable to Banks                           (50,000)        57,000
  Proceeds From Long-Term Borrowings                                 4,506,000        452,000
  Debt Restructuring Penalties                                        (162,000)             -
  Principal Payments on Borrowings                                  (4,155,000)    (1,170,000)
  Debt Issuance Costs                                                 (289,000)             -
  NET CASH USED IN FINANCING ACTIVITIES                               (150,000)      (661,000)
  INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                     203,000       (305,000)
Cash and Cash Equivalents at Beginning of Year                         476,000        781,000
  CASH AND CASH EQUIVALENTS AT END OF YEAR                            $679,000       $476,000
                                                                                             
Non Cash Financing and Investing Activities                                                  
     Equipment and Leasehold Improvements Financed by 
          Capital Leases                                              $400,000        $29,000
</TABLE>
See notes to financial statements.

<TABLE>
               Statements of Shareholders' Equity
<CAPTION>
                                

                                                     Additional       Retained               
                                    Common Stock        Paid-In       Earnings          Total
                                                        Capital      (Deficit)
                                                                                             
<S>                                  <C>              <C>         <C>              <C>
Balance as of June 30, 1996           $4,746,000       $228,000   $(2,581,000)     $2,393,000
     Net Loss for the year                     -              -      (446,000)       (446,000)
Balance as of June 29, 1997           4,746,0000        228,000    (3,027,000)      1,947,000
     Net Loss for the year                     -                   (1,064,000)     (1,064,000)
     Conversion of Debenture             500,000      (117,000)             -         383,000
     Common Stock for Services             7,000              -             -           7,000
Balance as of June 28, 1998          $5,2536,000       $111,000   ($4,091,000)     $1,273,000
</TABLE>

                           Cucos Inc.
                          June 28, 1998

                  Notes to Financial Statements
                                
                                
Note A - Significant Accounting Policies

      Fiscal  Year:  The  Company uses  a  52/53  week  year  for
financial reporting purposes with its fiscal year ending  on  the
Sunday  closest  to June 30.  1998 and 1997 were  fifty-two  week
years.
      Industry:  The  Company  is  a full-service  casual  dining
restaurant   chain  offering  Mexican  appetizers,  entrees   and
complementing  beverages.  At  year  end,  the  Company  operated
fifteen restaurants and franchised five restaurants.
       Use   of  Estimates:  The  preparation  of  the  financial
statements  in  conformity  with  generally  accepted  accounting
principles  requires management to make estimates and assumptions
that affect the amounts reported in the financial statements  and
accompanying  notes.  Actual  results  could  differ  from  those
estimates.
      Cash and Cash Equivalents: The Company considers all highly
liquid  investments purchased with an original maturity of  three
months or less to be cash equivalents.
      Inventories: Inventories, consisting primarily of food  and
beverages,  are stated at the lower of cost (first-in,  first-out
method) or market.
      Property,  Equipment,  and Other: Property,  Equipment  and
Other   is  stated  on  the  basis  of  cost.  Depreciation   and
amortization  are computed by the straight-line method  over  the
assets'  useful lives or their lease terms, whichever is shorter.
Amortization of assets recorded under capital leases is  included
in  depreciation  expense.  The useful lives of  equipment  range
from  3-10 years; the useful lives of leasehold improvements  are
generally  15 years, and the useful lives of reacquired franchise
rights,  which  represents  the  costs  to  reacquire  franchised
restaurants  in  excess of the tangible assets acquired,  are  15
years.
      Deferred  Costs: Deferred costs represent site costs,  debt
issuance  costs and other, primarily trademarks.   Deferred  site
costs  incurred  in the selection of sites for new  company-owned
restaurants  are  capitalized and amortized  on  a  straight-line
basis  over a 10-year period; costs incurred in the selection  of
sites  for  franchised restaurants are accumulated  and  expensed
when  the related franchise revenue is recognized. If a potential
site  is  abandoned, the deferred costs related to that site  are
charged  to current operations. Deferred debt issuance costs  are
amortized  over  the  life of the related  debt.  Other  deferred
costs,  primarily  trademarks, are amortized on  a  straight-line
basis over 20 years.
       Advertising  Costs:  Advertising  costs  are  expensed  as
incurred.  Advertising expense was $982,000 and $954,000 in  1998
and 1997, respectively.
      Franchise  Fees and Royalties: The Company sells  exclusive
rights  to  develop  Cucos restaurants in designated  territories
(Area  Development Agreements), as well as individual  franchises
for  each restaurant. The Area Development Agreements call for  a
nonrefundable fee paid to the Company in exchange for territorial
exclusivity.  Franchise  development  fee  revenue   from   these
agreements  is deferred and recognized as income on  a  pro  rata
basis as restaurants are developed in the designated territory or
when  the  developer forfeits the development  rights  under  the
agreement.  Franchise  fee  revenue  related  to  the  individual
restaurants is recognized as income when all obligations  of  the
Company  are  substantially  fulfilled,  which  occurs  when  the
franchise restaurant begins operations. Royalty income  is  based
upon  a percentage of franchise sales and is recognized as income
when   earned.   Royalties  and  other  receivables   are   often
collaterized  by personal guarantees and sometimes  by  equipment
owned by the franchisee.
      Investment  in LaMexiCo, L.L.C.:  The Company accounts  for
its  investment  using  the  equity method  of  accounting.   The
difference between the carrying amount of the investment and  the
amount of the underlying equity in the net assets of the investee
($26,000)  is  being  amortized over the term  of  the  franchise
agreement.
      Income  Taxes: The Company accounts for income taxes  using
the  liability method. Under this method deferred tax assets  and
liabilities are determined based on differences between financial
reporting  and  tax  bases  of assets and  liabilities,  and  are
measured  using the enacted tax rates and laws that  will  be  in
effect when the differences are expected to reverse.
      Impairment of Long-Lived Assets:  The Company reviews long-
lived  assets  to  be  held and used in the  business,  including
reacquired  franchise rights, for impairment whenever  events  or
changes in circumstances indicate that the carrying amount of  an
asset  or  a  group of assets may not be recoverable. Assets  are
evaluated  for  impairment at the operating  unit  level.     The
Company considers a history of operating losses to be its primary
indicator  of  potential impairment. An asset  is  deemed  to  be
impaired  if  a  forecast of undiscounted future  operating  cash
flows directly related to the asset, including disposal value  if
any, is less than its carrying amount.  If an asset is determined
to  be impaired, the loss is measured as the amount by which  the
carrying amount of the asset exceeds its fair value.  The Company
generally  estimates fair value by discounting  estimated  future
cash  flows.  Considerable judgment is necessary to estimate cash
flows.   Accordingly,  it  is  reasonably  possible  that  actual
results could vary significantly from such estimates.
     Stock-Based Compensation: The Company accounts for its stock
compensation  arrangements  under  the  provision  of  Accounting
Principles Board (OAPBO) No. 25, OAccounting for Stock Issued  to
EmployeesO.
     Reclassifications: Certain balances in the prior fiscal year
have  been reclassified to conform with the presentation  in  the
current fiscal year.

<TABLE>
Note B - Debt
<CAPTION>

<S>                                                                      <C>    
Note payable to insurance company - fixed interest rate - 9.5% -                 
     monthly payments of $4,000                                            $127,000
Notes payable to commercial lender  - fixed interest rate - 11.6% -              
     monthly payments of $55,000                                          3,340,000
Capital lease obligations - fixed interest rates of 12.11% to 14.2%              
     - monthly payments of $9,000                                           372,000
                                                                          3,839,000
Less current portion                                                        387,000
                                                                         $3,452,000
</TABLE>

      In November 1997, the Company used the proceeds from a loan
by   a  commercial  lending  company  to  refinance  all  of  its
outstanding notes payable to banks and finance companies, capital
lease  obligations, and other long-term debt that was outstanding
at  that time.  This loan is part of a pool of loans financed  by
the lender.  A provision of this loan required the Company to pay
additional  interest if certain conditions of the loan  pool  are
not  met.   This  provision  would require  the  Company  to  pay
additional  interest each month if the loan pool  conditions  are
not  met.  These monthly payments, if required, may increase  the
interest  costs  by a maximum of $400,000 over the  life  of  the
loan.  At year end, the Company had paid no additional interest.
     The Company's debt is collateralized by substantially all of
the  restaurant  equipment and leasehold improvements  and  other
assets and is guaranteed by a company officer.
      Maturities  of  long-term debt for each of  the  next  five
fiscal years are $387,000 in 1999; $435,000 in 2000; $489,000  in
2001;  $425,000  in 2002; and $386,000 in 2003. Interest  expense
approximates interest paid for each of the last two fiscal years.
     The Company has a line-of-credit agreement which provides up
to  $100,000 of short-term financing at prime plus 2%. There were
no  amounts available to borrow under that agreement as  of  year
end. Borrowings under this agreement are unsecured and mature  in
December 1998. At year end the prime rate was approximately 8.5%.
      The  weighted  average  interest  cost  on  the  short-term
borrowings  at  year  end  was 10.25%  and  the  overall  average
interest rate on long term debt was 12.1%.
       Certain  credit  and  long-term  debt  agreements  contain
covenants which include provisions for the maintenance of various
ratios.  At year end the Company was in compliance with all  such
covenants.
      In  July  1996, the Company issued $500,000 of  Zero-Coupon
Convertible   unregistered  debentures.   The   debentures   were
convertible  into  527,983 shares of the Company's  common  stock
beginning  on July 2000.  In January 1998, the Board of Directors
amended   the  terms  of  the  Company's  debentures   permitting
immediate  conversion.   On  February  19,  1998,  the  debenture
holders  exercised  their  conversion rights  and  converted  the
debentures into 527,983 shares of common stock.  At the  time  of
conversion, the debentures were owned by related parties.
      The carrying amounts reported in the balance sheet for debt
approximate fair value, as estimated using discounted  cash  flow
analyses,  based  on the CompanyOs current incremental  borrowing
rates for similar types of borrowing instruments.

Note C - Income Taxes

Significant components of the CompanyOs deferred tax  assets  and
liabilities are as follows:

Deferred tax assets:                                                     
     Net operating loss carryforwards                            $991,000
     Tax credit carryforwards                                     642,000
     Property                                                     335,000
     Other - net                                                  161,000
          Total deferred tax assets                             2,129,000
     Valuation allowance for deferred tax assets                2,016,000
                                                                  113,000
Deferred tax liabilities:                                                
     Prepaid and deferred costs                                   113,000
          Net deferred tax assets                                 $     -

      The  following is a reconciliation of income taxes  at  the
Federal  statutory rate of 34% to income taxes  reported  in  the
statements of operations based on loss before income taxes:
<TABLE>
<CAPTION>
                                                            June 28, 1998    June 29, 1997
<S>                                                            <C>              <C>
Income tax benefit at the Federal statutory rate               $(364,000)       $(152,000)
State taxes, net of Federal deductions                           (47,000)         (24,000)
Tax credits                                                             -        (117,000)
Miscellaneous items not deductible for Federal income                   -          41,000
taxes
Change in valuation allowance                                     828,000         252,000
                                                                                        
Income Taxes                                                    $       -       $      -
</TABLE>

     At year end for federal income tax purposes, the Company had
net  operating loss carryforwards of approximately $2,608,000 and
investment  and  jobs tax credits carryforwards of  approximately
$642,000. These carryforwards expire beginning in 1999.
      The Company has provided a valuation allowance for deferred
tax  assets,  which  may not be realized through  future  taxable
income  and  the  reversals  of  taxable  temporary  differences.
Because  of lower than expected revenues and earnings, management
increased the valuation allowance resulting in income tax expense
of $107,000.

Note D - Leases

      The  Company leases eighteen restaurant facilities and  its
corporate   headquarters  under  noncancelable  operating   lease
agreements  with  initial lease terms expiring between  1999  and
2011.  Eighteen  of the restaurant leases have remaining  renewal
options,  and  fifteen provide for contingent  rentals  based  on
sales  performance  in  excess of specified minimums.  Contingent
rentals  were not material in any year. Some of the  leases  also
have  varying  escalation clauses based either  on  fixed  dollar
increases, a percentage of the previous minimum annual rental, or
the  consumer price index.  Amortization of assets recorded under
capital leases is included in depreciation expense.
      The  Company  subleases three restaurant  facilities  under
noncancelable sublease agreements with lease terms expiring  from
2005-2012.  The Company revised and increased its reserve for the
difference between anticipated sublease income and the  Company's
minimum  commitment  under  these  leases  by  $1,630,000.   This
reserve is included in deferred revenue and other liabilities.
      Future  minimum lease and sublease payments were as follows
at year end:

                              Operating Leases                             
                    Lease        Sublease       Net       Capital Leases
1999              $1,439,000       $231000   $1,128,000         $111,000
2000               1,365,000       233,000    1,056,000          111,000
2001               1,199,000       265,000      854,000          111,000
2002               1,113,000       265,000      767,000          111,000
2003                 865,000       265,000      540,000           55,000
Thereafter         3,402,000     1,048,000    2,354,000                -
                                                                 499,000
                    Less unamortized discount (12.1-14.2%)      (127,000)
                                                                $372,000

      Rent expense for real estate on all the CompanyOs operating
leases was $1,594,000 in 1998 and $1,560,000 in 1997.
     Included in Property, Equipment and Other are assets subject
to capital leases of:
                                                   
Equipment and Leasehold Improvements       $649,000
Accumulated Amortization                   (245,000)
                                           $404,000

Note E - Related Party Transactions

     The Company is affiliated with L.B.G., Inc. ("LBG"), through
common  ownership.  The Company charges LBG  for  accounting  and
administrative services based on the gross sales of each company.
The amounts reimbursed in 1998 and in 1997 were nominal.  At June
28,  1998,  LBG owed the Company $93,000 for food, rent  supplies
and service.
      The  Company  owns  a  31.0% interest in  LaMexiCo,  L.L.C.
("LaMexiCo"),  a  limited  liability  company,  that  operates  a
franchised Cucos in Metairie, Louisiana. The Company also manages
the  restaurant  for LaMexiCo, and receives 4% of  net  sales  as
compensation.  There  was no undistributed income  from  LaMexiCo
included  in  the Company's retained earnings at June  28,  1998.
The  restaurant  opened under the development  rights  previously
owned  by  LBG.  LBG currently owns 25.3% of LaMexiCo.   At  year
end,  LaMexiCo  owed the Company $32,000, which is paid  current,
for management fees, royalties and other expenses.
      The  following summarizes the Company's relationships  with
LaMexiCo.

                                              1998        1997
Royalties received                          $58,000     $54,000
Management fees received                    $77,000     $80,000
Receivable outstanding at year end          $32,000     $17,000
Equity in earnings                          $33,000     $25,000
                                                              
     LaMexiCo summarized financial information (based on the
investee's fiscal year ending April of each year):

                                      1998           1997
Balance Sheet                                     
     Total Liabilities              $259,000       $253,000
     Members Equity                  696,000        777,000
     TOTAL ASSETS                   $955,000     $1,030,000
                                                  
Statement of Income                               
     Revenues                     $2,202,000     $1,834,000
     Net Income                     $133,000       $115,000

      The Company leases the land, building and improvements  for
one  Company-owned restaurant from a director.  The primary  term
of  the  lease is 15 years and expires in 2000 with an option  to
renew  for 15 years.  The Company paid rent of $127,000  in  1998
and 1997.
      The  Company has agreements with Brothers Video,  Inc.,  an
affiliated company, to supply video poker machines in nine  Cucos
restaurants  located in Louisiana. The term of each agreement  is
10  years. The Company has the option to renew each contract  for
two additional years.
      Under the agreements the Company shares in the gross device
revenues  less state franchise fees and receives 70% of  the  net
receipts. The Chairman and Chief Executive Officer of the Company
is the sole stockholder of Brothers Video, Inc. At June 28, 1998,
the  Company  had  a  current accounts receivable  from  Brothers
Video,  Inc.  of  $34,000 for video poker revenues  earned.   The
Company's  share of video poker revenues, included  in  sales  of
food  and  beverages,  was 3.1% and 2.6% of  sales  of  food  and
beverages in 1998 and 1997 respectively.
      Also see Note B for description of issuance of $500,000  of
non  interest  bearing convertible debt to related  parties.   At
various times during 1998 an officer made advances to the Company
totaling $37,000 of which all has been repaid.  The high  balance
outstanding during the year was $57,000.

Note F - Stock Options

     The Company's 1993 Incentive Stock Option Plan (Option Plan)
has  authorized the grant of options to directors and  management
personnel for up to 509,000 shares of the Company's common stock.
The  option price of each incentive stock option granted may  not
be less than 100% of the fair market value of the Common Stock at
date  of grant.  Additionally, the Company may award nonqualified
stock  options under the Option Plan at an exercise price of  not
less  than the fair market value of the Common Stock at the  date
of  grant.  All options granted have 10 year terms and  vest  and
become  exercisable  in four equal annual installments  beginning
one year after the grant date.
     The following table summarizes options outstanding for 1998.
The weighted average contractual life is 8 years.
<TABLE>
<CAPTION>
                                                       1998                          1997
                                                            Weighted                      Weighted
                                               Shares     Avg. Price         Shares     Avg. Price
     <S>                                      <C>        <C>              <C>          <C>
     Outstanding at beginning of year         370,000          $1.40        395,000          $1.67
     Granted                                   81,700          $1.04        244,000          $1.32
     Forfeited                                (7,500)          $1.51      (269,000)          $1.73
     Exercised                                      -              -              -              -
     Outstanding at end of year               444,200          $1.31        370,000          $1.40
     Exercisable at end of year               249,000                       251,000               
     Exercise Price                                      $1.18-$1.94                   $1.18-$1.94
</TABLE>

      The  weighted  average remaining contractual  life  of  the
options  outstanding  is 8.5 years.  The  weighted  average  fair
value  of  options  granted during 1998 and 1997  was  $1.00  per
share.
      Pro forma information regarding net income and earnings per
share  is  required by FASB Statement 123, Accounting  for  Stock
Based  Compensation, which also requires that the information  be
determined as if the Company has accounted for its employee stock
options under the fair value method of that Statement.  The  fair
value  for these options was estimated at the date of grant using
a Black-Scholes option pricing model with the following weighted-
average  assumptions  for 1998 and 1997, respectively:  risk-free
interest rates of 6.3% and 5.9%; no dividends; volatility factors
of the expected market price of the Company's common stock of .54
and .48; and a weighted-average expected life of the options of 5
years.
      The Black-Scholes option valuation model was developed  for
use in estimating the fair value of traded options which have  no
vesting  restrictions and are fully transferable.   In  addition,
option  valuation  models require the input of highly  subjective
assumptions   including  the  expected  stock  price  volatility.
Because the Company's employee stock options have characteristics
significantly different from those of traded options, and because
changes in the subjective input assumptions can materially affect
the  fair  value estimate, in management's opinion, the  existing
models  do  not necessarily provide a reliable single measure  of
the fair value of its employee stock options.
      For  purposes of pro forma disclosures, the estimated  fair
value  of  the options is amortized to expense over the  options'
vesting period.  The Company's pro forma information follows  (in
thousands except for earnings per share information).

                                                        1998         1997
     Pro forma net loss                             ($1,089,000)  ($662,000)
     Pro forma loss per share-Basic and diluted        ($.47)       ($.31)

Note G - Per Share Amounts

      Basic  loss  per  share amounts are based on  the  weighted
average  number  of shares of Common Stock outstanding.   Diluted
per  share  amounts  give  effect to securities  (stock  options)
outstanding,  if any.  Stock options were anti-dilutive  in  1998
and  1997.   The Financial Accounting Standards Board issued  FAS
128, Earnings Per Share, which was effective in the period ending
December 1997.  The adoption of this pronouncement had no  impact
on  the  Company's previously reported 1997 or 1998 reported  per
share amounts.

Note H - Franchise Operations

      In  addition to its company-owned restaurants, the  Company
had  five franchised restaurants in operation at the end of 1998.
During  1998  no franchised restaurants opened and no  franchised
restaurants  closed.   During  1997,  one  franchised  restaurant
opened and none closed.

Note I - Shareholders' Rights Agreement

      In  1989  the Company declared a distribution of rights  to
purchase  the CompanyOs Common Stock at a rate of one  right  for
each  outstanding share of the Company's Common Stock. The rights
were  issued  in  February 1990. The rights are  not  exercisable
until  ten  days following the occurrence of one of the following
events: 1) acquisition by a group or person of 15% or more of the
Company's  Common  Stock, or 2) an announcement  by  a  potential
acquirer of a tender or exchange offer that would result  in  the
ownership  of  15%  or more of the Company's Common  Stock.  Once
exercisable, unless redeemed earlier by the Company,  each  right
entitles  the holder to buy $12 worth of shares of the  CompanyOs
Common  Stock for an exercise price of $6. The Company may redeem
the  rights at $.01 per right at any time until 10 days after 15%
or  more of the Company's Common Stock is acquired by a person or
group. The rights will expire on December 31, 1999.

Note J - Defined Contribution Plan

      The  Company  sponsors a defined contribution savings  plan
which  is  available  to  substantially all  employees.  Eligible
employees  may  contribute up to 20% of their  compensation.  The
Company contributes an additional amount to the plan equal to 15%
of  employee  contributions  up to 5%  of  compensation.  Company
contributions were $15,000 in 1998 and 1997.

Note K - Contingencies

      The  Company has various lawsuits arising from  its  normal
operations.  It is the opinion of management that the outcome  of
these  matters  will not have a material adverse  effect  on  the
Company's financial position or results of operations.


        Report of Ernst & Young LLP, Independent Auditors

Board of Directors and Shareholders
Cucos Inc.

     We have audited the accompanying balance sheet of Cucos Inc.
as  of  June  28, 1998, and the related statements of operations,
shareholders' equity, and cash flows for each of the two years in
the  period  ended June 28, 1998. These financial statements  are
the    responsibility   of   the   Company's   management.    Our
responsibility  is  to  express an  opinion  on  these  financial
statements based on our audits.
      We  conducted  our  audits  in  accordance  with  generally
accepted auditing standards. Those standards require that we plan
and  perform  the  audit  to  obtain reasonable  assurance  about
whether   the   financial  statements  are   free   of   material
misstatement.  An  audit includes examining,  on  a  test  basis,
evidence  supporting the amounts and disclosures in the financial
statements.  An  audit  also includes  assessing  the  accounting
principles used and significant estimates made by management,  as
well  as evaluating the overall financial statement presentation.
We  believe  that our audits provide a reasonable basis  for  our
opinion.
      In  our opinion, the financial statements referred to above
present  fairly, in all material respects, the financial position
of Cucos Inc. at June 28, 1998, and the results of its operations
and  its cash flows for each of the two years in the period ended
June  28,  1998, in conformity with generally accepted accounting
principles.

                                        ERNST & YOUNG LLP

New Orleans, Louisiana
September 25, 1998


Item 8.   Changes  in  and   Disagreements  with  Accountants  on
          Accounting and Financial Disclosure.

          None.

                                
                            PART III
                                
Item 9.   Directors,  Executive Officers, Promoters  and  Control
          Persons;  Compliance with Section 16(a) of the Exchange
          Act of the Registrant.

           Reference  is  made to the information concerning  the
directors  of the Registrant and the nominees for re-election  as
directors appearing under the caption "Election of Directors"  in
the  1998  Proxy  Statement.   Such information  is  incorporated
herein  by reference to the Registrant's 1998 Proxy Statement  to
be  filed with the Securities and Exchange Commission in October,
1998.

           Reference  is  made to the information concerning  the
executive  officers  of  the Registrant  who  are  not  directors
appearing  under the caption "Executive Officers of the  Company"
in  the  1998  Proxy Statement.  Such information is incorporated
herein  by reference to the Registrant's 1998 Proxy Statement  to
be  filed with the Securities and Exchange Commission in October,
1998.

            Reference  is  made  to  the  information  concerning
compliance with Section 16(a) of the Exchange Act appearing under
the   caption  "Section  16A,  Beneficial  Ownership's  Reporting
Compliance"  in  the 1998 Proxy Statement.  Such  information  is
incorporated herein by reference to the Registrant's  1998  Proxy
Statement to be filed with the Securities and Exchange Commission
on October, 1998.

Item 10.  Executive Compensation.

            Reference  is  made  to  the  information  concerning
remuneration   of  directors  and  executive  officers   of   the
Registrant  appearing under the captions "Additional Information-
Executive  Compensation,"  "Additional  Information-Stock  Option
Grants  During  Fiscal  1998," "Additional Information-Aggregated
Stock Option Exercises and Fiscal Year-Ended Option Values,"  and
"Additional Information-Compensation of Directors," in  the  1998
Proxy  Statement.   Such  information is incorporated  herein  by
reference  to the Registrant's 1998 Proxy Statement to  be  filed
with the Securities and Exchange Commission in October, 1998.

Item  11.   Security Ownership of Certain Beneficial  Owners  and
Management.

            Reference  is  made  to  the  information  concerning
beneficial ownership of the Registrant's Common Stock,  which  is
the  only  class of the Registrant's voting securities, appearing
under  the  captions  "Beneficial  Ownership"  and  "Election  of
Directors"  in  the  1998 Proxy Statement.  Such  information  is
incorporated herein by reference to the Registrant's  1998  Proxy
Statement to be filed with the Securities and Exchange Commission
in October, 1998.

Item 12.  Certain Relationships and Related Transactions.

           Reference is made to the information regarding certain
relationships  and  transactions between the Registrant  and  its
directors,   nominees  for  re-election  as  directors   of   the
Registrant, its executive officers, beneficial owners  of  5%  or
more  of its Common Stock and any member of the immediate  family
of  any  of  the foregoing persons, appearing under  the  caption
"Additional   Information-Certain   Relationships   and   Related
Transactions"  in the 1998 Proxy Statement.  Such information  is
incorporated herein by reference to the Registrant's  1998  Proxy
Statement to be filed with the Securities and Exchange Commission
in October, 1998.

Item 13.  Exhibits and Reports on Form 8-K.

          EXHIBITS

           The  following  exhibits are filed  with  this  Annual
Report or are incorporated herein by reference:

Exhibit                              Title
Number                                 
 1 2        -  Joint Agreement of Merger, dated February 23,
               1983, of Cu-Co's of Biloxi, Inc.
               
 1 3-A      -  Copy of Articles of Incorporation of the
               Registrant.
               
 1 3-A-1    -  Copy of Amendment to Articles of Incorporation of
               the Registrant.
               
 1 3-A-2    -  Copy of Amendment to Articles of Incorporation of
               the Registrant.
               
 1 3-A-3    -  Copy of Amendment to Articles of Incorporation of
               the Registrant.
               
 1 3-B      -  Copy of By-Laws of the Registrant.
               
 2 3-B-1    -  Copy of Amendment to By-Laws of Registrant.
               
 9 3-B-2    -  Amended and Restated By-Laws of the Registrant.
               
 3 4-A      -  Rights Agreement, dated as of February 5, 1990,
               between the Registrant and Commercial National
               Bank in Shreveport.
               
 3 4-B      -  Letter, dated February 26, 1991, from Whitney
               National Bank to the Registrant confirming the
               change of Rights Agent from Commercial National
               Bank in Shreveport to Whitney National Bank.
               
 3 4-C      -  Assignment of Rights Agreement, dated August 30,
               1993, among Whitney National Bank, Boatmen's
               National Bank and the Registrant with respect to
               the change of Rights Agent from Whitney National
               Bank to Boatmen's National Bank.
               
 11 4-D     -  Copy of Mortgage and Security Agreement dated
               April 25, 1994, with First National Bank of
               Commerce for $450,000.
               
 11 4-E     -  Copy of Promissory Note dated October 27, 1994,
               with First National Bank of Commerce for
               $200,000.
               
 11 4-F     -  Copy of Promissory Note dated October 27, 1994,
               with First National Bank of Commerce for
               $250,000.
               
 11 4-G     -  Copy of Promissory Note dated October 27, 1994,
               with First National Bank of Commerce for
               $500,000.
               
 10 4-H     -  Note Purchase Agreement (with Exhibits).
               
 10 4-I     -  Amendment No. 1 to Rights Agreement dated March
               12, 1991.
               
 12 4-J     -  Assignment of Rights Agreement dated June 2,
               1997, among Boatman's National Bank, ChaseMellon
               Shareholder Services, L.L.C. and the Registrant
               with respect to the change of Rights Agent to
               ChaseMellon Shareholder Services, L.L.C.
               
    4-K     -  Assignment of Rights Agreement dated September
               21, 1998, among ChaseMellon shareholder Services,
               L.L.C., Registrar and Transfer Company and the
               Registrant with respect to the change of Rights
               Agent to Registrar and Transfer Company.
               
 1 10-A     -  Copy of Registrant's 1983 Stock Option Plan.
               
 1 10-B     -  Copy of letter agreement between the Registrant
               and certain stockholders of the Registrant
               relating to piggyback registration rights.
               
 4 10-C     -  Amendment No. 1 to 1983 Stock Option Plan of
               Cucos Inc.
               
 5 10-D     -  Amendment No. 2 to 1983 Stock Option Plan of
               Cucos Inc.
               
 5 10-E     -  Amendment No. 3 to 1983 Stock Option Plan of
               Cucos Inc.
               
 6 10-F     -  Amendment No. 4 to 1983 Stock Option Plan of
               Cucos Inc.
               
 7 10-G     -  Amendment No. 5 to 1983 Stock Option Plan of
               Cucos Inc.
               
 5 10-H     -  Form of Incentive Stock Option Agreement for 1983
               Stock Option Plan.
               
 5 10-I     -  Form of Non-Qualified (Employee) Stock Option
               Agreement for 1983 Stock Option Plan.
               
 5 10-J     -  Form of Non-Qualified (Director) Stock Option
               Agreement for 1983 Stock Option Plan.
               
 8 10-K     -  Description of Registrant's Bonus Plan.
               
 9 10-L     -  Copy of Registrant's 1993 Stock Option Plan as
               amended.
               
 9 10-M        Form of Non-Qualified Stock Option Agreement for
               1993 Stock Option Plan
               
 9 10-N        Form of Incentive Stock Option Agreement for 1993
               Stock Option Plan
               
    23      -  Consent of Independent Auditors
               
    27      -  Financial Data Schedule

________________________________

1    Filed   as  an  exhibit  to  the  Registrant's  Registration
     Statement  on  Form S-18 (Commission File No. 2-87372A)  and
     incorporated herein by reference.

2    Filed  as an exhibit to Form 10-K for the fiscal year  ended
     July  1, 1984 (Commission File No. 0-12701) and incorporated
     herein by reference.

3    Filed  as  an  exhibit to Form 8-K dated February  23,  1991
     (Commission  File No. 0-12701), as amended by Form  8  dated
     March 12, 1991, and incorporated herein by reference.

4    Filed   as  an  exhibit  to  the  Registrant's  Registration
     Statement  on  Form S-8 (Commission File No.  33-03953)  and
     incorporated herein by reference.

5    Filed   as  an  exhibit  to  the  Registrant's  Registration
     Statement  on  Form S-8 (Commission File No.  33-15785)  and
     incorporated herein by reference.

6    Filed   as  an  exhibit  to  the  Registrant's  Registration
     Statement  on  Form S-8 (Commission File No.  33-26941)  and
     incorporated herein by reference.

7    Filed  as an exhibit to Form 10-K for the fiscal year  ended
     June 28, 1992 (Commission File No. 0-12701) and incorporated
     herein by reference.

8    Filed  as an exhibit to Form 10-K for the fiscal year  ended
     June 28, 1987 (Commission File No. 0-12701) and incorporated
     herein by reference.

9    Filed as an exhibit to Form 10-KSB for the fiscal year ended
     July  3, 1994 (Commission File No. 0-12701) and incorporated
     herein by reference.

10   Filed  as  an  exhibit  to Form 8-K filed  August  11,  1995
     (Commission  File  No. 0-12701) and incorporated  herein  by
     reference.

11   Filed as an exhibit to Form 10-KSB for the fiscal year ended
     July  2, 1995 (Commission File No. 0-12701) and incorporated
     herein by reference.

12   Filed  as  an exhibit to Form 8-A dated September 11,  1998,
     and incorporated herein by reference.

           The  Registrant  is  a  party  to  various  agreements
defining  the  rights  of  holders  of  long-term  debt  of   the
Registrant, but no single agreement authorizes securities  in  an
amount  which exceeds 10% of the total assets of the  Registrant.
Accordingly, such agreements are omitted as exhibits as permitted
by Item 601(b) (4) (ii) of Regulation S-B.

     REPORTS ON FORM 8-K:

           No  reports on Form 8-K were filed during  the  fourth
quarter of Fiscal Year ended June 28, 1998
                                
                   QUALIFICATION BY REFERENCE

           Information contained in this Annual Report as to  the
contents  of  any  contract  or other  document  referred  to  or
evidencing a transaction referred to is necessarily not complete,
and  in  each  instance reference is made to  the  copy  of  such
contract  or  other document filed as an exhibit to  this  Annual
Report  or incorporated herein by reference, all such information
being    qualified   in   its   entirety   by   such   reference.

SIGNATURES



            In  accordance  with  Section  13  or  15(d)  of  the
Securities  Exchange  Act  of 1934, the  Registrant  caused  this
report  to  be signed on its behalf by the undersigned, thereunto
duly authorized.


                                CUCOS INC.


Date:  September 25, 1998       By:/s/ Vincent J. Liuzza, Jr.
                                   Chairman of the Board and
                                   Chief Executive Officer

          In accordance with the Securities Exchange Act of 1934,
this report has been signed below by the following persons on
behalf of the Registrant and in the capacities indicated as of
September 25, 1998.



/s/ Sidney C. Pulitzer          /s/ Thomas J. Grace
Sidney C. Pulitzer, Director        Thomas J. Grace, Director and
                                      Secretary



/s/ Miguel Uria                 /s/ Frank J. Ferrara, Jr.
Miguel Uria, Director           Frank J. Ferrara, Director



/s/ David M. Liuzza             /s/ Vincent J. Liuzza, Jr.
David M. Liuzza, Director       Vincent J. Liuzza, Jr., Chairman
                                of the Board of Directors and
                                Chief Executive Officer

                          EXHIBIT INDEX
                                

Exhibit                             Title
Number                                 
 (1)  2     -  Joint Agreement of Merger, dated February 23,
               1983, of Cu-Co's of Biloxi, Inc.
               
 (1)  3-A   -  Copy of Articles of Incorporation of the
               Registrant.
               
 (1)  3-A-1 -  Copy of Amendment to Articles of Incorporation
               of the Registrant.
               
 (1)  3-A-2 -  Copy of Amendment to Articles of Incorporation
               of the Registrant.
               
 (1)  3-A-3 -  Copy of Amendment to Articles of Incorporation
               of the Registrant.
               
 (1)  3-B   -  Copy of By-Laws of the Registrant.
               
 (2)  3-B-1 -  Copy of Amendment to By-Laws of Registrant.
               
 (9)  3-B-2 -  Amended and Restated By-Laws of the Registrant.
               
 (3)  4-A   -  Rights Agreement, dated as of February 5, 1990,
               between the Registrant and Commercial National
               Bank in Shreveport.
               
 (3)  4-B   -  Letter, dated February 26, 1991, from Whitney
               National Bank to the Registrant confirming the
               change of Rights Agent from Commercial National
               Bank in Shreveport to Whitney National Bank.
               
 (3)  4-C   -  Assignment of Rights Agreement, dated August 30,
               1993, among Whitney National Bank, Boatmen's
               National Bank and the Registrant with respect to
               the change of Rights Agent from Whitney National
               Bank to Boatmen's National Bank.
               
 (11)  4-D  -  Copy of Mortgage and Security Agreement dated
               April 25, 1994, with First National Bank of
               Commerce for $450,000.
               
 (11)  4-E  -  Copy of Promissory Note dated October 27, 1994,
               with First National Bank of Commerce for
               $200,000.
               
 (11)  4-F  -  Copy of Promissory Note dated October 27, 1994,
               with First National Bank of Commerce for
               $250,000.
               
 (11)  4-G  -  Copy of Promissory Note dated October 27, 1994,
               with First National Bank of Commerce for
               $500,000.
               
 (10)  4-H  -  Note Purchase Agreement (with Exhibits).
               
 (10)  4-I  -  Amendment No. 1 to Rights Agreement dated March
               12, 1991.
               
 (12)  4-J  -  Assignment of Rights Agreement dated June 2,
               1998, among Boatman's National Bank, ChaseMellon
               Shareholder Services, L.L.C. and the Registrant
               with respect to the change of Rights Agent to
               ChaseMellon Shareholders Services, L.L.C.
               
               Assignment of Rights Agreement dated September
4-K         -  21, 1998, among ChaseMellon shareholder
               Services, L.L.C., Registrar and Transfer Company
               and the Registrant with respect to the change of
               Rights Agent to Registrar and Transfer Company.
               
 (1)  10-A  -  Copy of Registrant's 1983 Stock Option Plan.
               
 (1)  10-B  -  Copy of letter agreement between the Registrant
               and certain stockholders of the Registrant
               relating to piggyback registration rights.
               
 (4)  10-C  -  Amendment No. 1 to 1983 Stock Option Plan of
               Cucos Inc.
               
 (5)  10-D  -  Amendment No. 2 to 1983 Stock Option Plan of
               Cucos Inc.
               
 (5)  10-E  -  Amendment No. 3 to 1983 Stock Option Plan of
               Cucos Inc.
               
 (6)  10-F  -  Amendment No. 4 to 1983 Stock Option Plan of
               Cucos Inc.
               
 (7)  10-G  -  Amendment No. 5 to 1983 Stock Option Plan of
               Cucos Inc.
               
 (5)  10-H  -  Form of Incentive Stock Option Agreement for
               1983 Stock Option Plan.
               
 (5)  10-I  -  Form of Non-Qualified (Employee) Stock Option
               Agreement for 1983 Stock Option Plan.
               
 (5)  10-J  -  Form of Non-Qualified (Director) Stock Option
               Agreement for 1983 Stock Option Plan.
               
 (8)  10-K  -  Description of Registrant's Bonus Plan.
               
 (9)  10-L  -  Copy of Registrant's 1993 Stock Option Plan as
               amended.
               
 (9)  10-M     Form of Non-Qualified Stock Option Agreement for
               1993 Stock Option Plan
               
 (9)  10-N     Form of Incentive Stock Option Agreement for
               1993 Stock Option Plan
               
    23      -  Consent of Independent Auditors
               
    27      -  Financial Data Schedule

________________________________

(1)  Filed   as  an  exhibit  to  the  Registrant's  Registration
     Statement  on  Form S-18 (Commission File No. 2-87372A)  and
     incorporated herein by reference.

(2)  Filed  as an exhibit to Form 10-K for the fiscal year  ended
     July  1, 1984 (Commission File No. 0-12701) and incorporated
     herein by reference.

(3)  Filed  as  an  exhibit to Form 8-K dated February  23,  1990
     (Commission  File No. 0-12701), as amended by Form  8  dated
     March 12, 1991, and incorporated herein by reference.

(4)  Filed   as  an  exhibit  to  the  Registrant's  Registration
     Statement  on  Form S-8 (Commission File No.  33-03953)  and
     incorporated herein by reference.

(5)  Filed   as  an  exhibit  to  the  Registrant's  Registration
     Statement  on  Form S-8 (Commission File No.  33-15785)  and
     incorporated herein by reference.

(6)  Filed   as  an  exhibit  to  the  Registrant's  Registration
     Statement  on  Form S-8 (Commission File No.  33-26941)  and
     incorporated herein by reference.

(7)  Filed  as an exhibit to Form 10-K for the fiscal year  ended
     June 28, 1992 (Commission File No. 0-12701) and incorporated
     herein by reference.

(8)  Filed  as an exhibit to Form 10-K for the fiscal year  ended
     June 28, 1987 (Commission File No. 0-12701) and incorporated
     herein by reference.

(9)  Filed as an exhibit to Form 10-KSB for the fiscal year ended
     July  3, 1994 (Commission File No. 0-12701) and incorporated
     herein by reference.

(10) Filed  as  an  exhibit  to Form 8-K filed  August  11,  1995
     (Commission  File  No. 0-12701) and incorporated  herein  by
     reference.

(11) Filed as an exhibit to Form 10-KSB for the fiscal year ended
     July  2, 1995 (Commission File No. 0-12701) and incorporated
     herein by reference.

(12) Filed  as  an exhibit to Form 8-A dated September 11,  1998,
     and incorporated herein by reference.