UNITED STATES
                     SECURITIES AND EXCHANGE COMMISSION
                           Washington, D.C. 20549

                                 Form 10-QSB

X  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
 OF 1934.   For the quarterly period ended March 31, 2000

    TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
ACT

          For the transition period from       to

            Commission file number  33-40799

                 TIMBERLINE BANCSHARES, INC.
(Exact name of small business issuer as specified in its charter)

          California                        68-0269988
(State or other jurisdiction of    (IRS Employer Identification No.)
of incorporation or organization)

         123 N. Main Street   P. O. Box 1087, Yreka, Ca 96097
               Address of principal executive offices)

                          ( 530 )842-4200
                     (Issuer's telephone number)


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

Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Exchange Act during the past
12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.  Yes X   No   .

        APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
           PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant filed all documents and report required to
be filed by Section 12, 13 or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by a court.  Yes    No

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date:
1,006,860







PART 1 - FINANCIAL INFORMATION

Item 1. Financial Statements
      "TIMBERLINE BANCSHARES, INC."
      CONSOLIDATED INCOME STATEMENT
          Periods Indicated

                                             Q 03/31/00     Q 3/31/99
INTEREST AND FEES ON LOANS                      1,337         1,241
INTEREST AND DIVIDENDS ON INVESTMENT
 SECURITIES
     HELD FOR SALE                                243           180
     HELD TO MATURITY                              40            66
TRADING ACCOUNT INTEREST                            -             -
OTHER INTEREST                                     74           138
TOTAL INTEREST INCOME                           1,694         1,625
INTEREST ON DEPOSITS                              585           570
INTEREST ON SHORT TERM BORROWING                    -             -
INTEREST ON LONG TERM DEBT                          -             -
TOTAL INTEREST EXPENSE                            585           570
NET INTEREST INCOME                             1,109         1,055
PROVISION FOR LOAN LOSSES                          21            30
NET INTEREST INCOME AFTER ALLOWANCE
FOR LOAN LOSSES                                 1,088         1,025
OTHER INCOME                                      100           105
OTHER EXPENSES                                    922           923
INCOME BEFORE TAX                                 266           207
INCOME TAX EXPENSE                                 74            63
INCOME BEFORE EXTRAORDINARY ITEMS                 192           144
EXTRAORDINARY ITEM NET OF TAX                       -             -
CUMULATIVE EFFECT OF ACCOUNTING
CHANGES                                             -             -
NET INCOME                                        192           144
EARNINGS PER SHARE                               0.19          0.14


Note 1:  The financial statements in this report are unaudited but, in
The opinion of management of the Corporation reflect all adjustments
(consisting only of normal recurring adjustments) necessary for a fair
presentation of financial position, results of operations, and changes
in financial position for the periods presented.














TIMBERLINE BANCSHARES, INC.
                             CONSOLIDATED BALANCE SHEET
                                       3/31/00


                                             3/31/00        3/31/99
             ASSETS
CASH & DUE FROM BANKS                         $7,415         $6,476
INTEREST BEARING DEPOSITS IN OTHER               100            100
FED FUNDS & RESALE SECURITY AGREE              1,500         10,000
TRADING ACCOUNT ASSETS                             0              0
OTHER SHORT TERM                                   0          1,378
INVESTMENT SECURITIES
   HELD FOR SALE                              17,244         13,835
   MATURITY                                    3,018          4,956
LOANS TOTAL                                   59,312         51,867
   ALLOWANCE FOR LOAN LOSSES                    (384)          (385)
   UNEARNED INCOME                              (101)          (100)
PREMISES & EQUIPMENT                           1,830          1,977
DUE FROM CUSTOMERS, ACCEPTANCES                    0              0
OTHER ASSETS                                   4,020          1,846
     TOTAL                                   $93,954        $91,950

            LIABILITIES
DEPOSITS, NON-INTREST BEARING                $18,411        $16,451
          INTEREST BEARING                    66,746         66,809
SHORT TERM BORROWING                               0              0
BANK ACCEPTANCES                                   0              0
OTHER LIABILITIES                                839            707
LONG TERM DEBT                                     0              0
COMMITMENTS & CONTINGENT LIABILITY                 0              0
MINORITY INTERESTS                                 0              0

           SHAREHOLDER EQUITY
PERFERED STOCK                                     0              0
COMMON STOCK                                   2,993          2,993
OTHER S/H EQUITY                               4,965          4,990
    TOTAL                                    $93,954        $91,950


Note: Held for Sell amount includes unrealized loss of $417




















TIMBERLINE BANCSHARES, INC.
                      CONSOLIDATED CASH FLOWS


CASH FLOW FROM OPERATING ACT             YTD 3/31/00       YTD 3/31/99
   NET INCOME                                  192               144
   NON-CASH
     DEPRECIATION                               54                52
     NET CHANGE BAD DEBTS PROV                  12                 7
     CUMU EFFECT ACCTG CH
   (INCREASE) DECREASE IN
     OTHER ASSETS                               14              (114)
   INCREASE (DECREASE) IN
     ACCRUED EXPENSES                           73                52

CASH PROVIDED BY OPS                           345               141


CASH FROM INVESTING
    INCREASE (DECREASE) IN
     DEPOSITS                                2,006             1,261
    (INCREASE) DECREASE IN
     SHORT  TERM INVESTMENTS                     0               (17)
     SECURITIES: FOR SALE                      (46)             (570)
                          HOLD                 154               582
     FED FUNDS                                (700)             (200)
     LOANS                                  (1,285)              515
     (PURCHASE) SALE OF F.A.                   (10)              (22)


CASH (USED) PROVIDED                           119             1,549


CASH FROM FINANCING
    DIVIDENDS PAID                               0                 0
    ADDITIONAL PD IN CAP                         0                 0


CASH(APPLIED) PROVIDED                           0                 0

NET CHANGE                                     464             1,690

OPEN                                         6,951             4,886

CLOSE                                        7,415             6,576








            3-

Item 2.  Management's Discussion

(a) Plan of Operation

Timberline Bancshares management is an ?overlay? of its wholly
owned subsidiary, Timberline Community Bank, and therefore shares
the same concepts regarding growth of the institution, protection
and preservation of assets, shareholder enhancement, and
fulfilling the joint mission statement to assist the communities
which we serve.

Timberline's plans are to increase it's market share in the areas
it serves, continue to upgrade services to it's customers,
continue to offer loans to the customers in it?s service area, to
enhance earnings, to control costs, and to enhance the
shareholders' value.



(b) Management's Discussion and Analysis of Financial condition
and Results of Operations


Net interest income in the first quarter of 2000 exceeds that of
the first quarter of 1999 as a result of the recent rises in prime
rate and an increase in loans outstanding and a slight decrease
in interest bearing deposits coupled with a slower rise in
interest paid to depositors.

While economic indicators report the nation's unemployment rate
at 4.7% Siskiyou County has a current unemployment rate of 11.6%.
The county has been in an economic downturn for years as it's main
economy was based on timber products and services. In view of
those economic conditions , the Bank has accelerated its program
of buying participations from other financial institutions outside
its normal lending area.  Through this program, the bank has
increased the loan to deposit ratio somewhat and expects an
increase in income from lending for the remainder of the year.

As a relatively small bank in a sparsely populated county, the
bank does not offer mutual funds or insurance as an avenue of
enhancing income.  Nor has the bank greatly increased service fees
to its customers, but has relied on the traditional banking
revenue sources; i.e. income from lending.  With a loan
delinquency of less than one per cent, the Bank has reduced the
amount set aside in loan loss reserves while still maintaining an
adequate reserve.  Other expenses have gone down slightly as the
Bank is no longer investing funds in last year's Y2K readiness.

In addition, the Bank has continued its dividend program and will
be paying a $.25 per share cash dividend to shareholders of record
in the second quarter of the year.




                  -4-

PART 11 - OTHER INFORMATION

Item 1. Legal Proceedings

There are no legal proceedings pending other than those in the
normal course of doing business that may have a material impact on
the bank.

Item 2.  Changes in Securities

None

Item 3.  Defaults Upon Senior Securities

None

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

None

Item 5.  Other Information

None

Item 6.  Exhibits and Reports on Form 8-K

None






SIGNATURES

In accordance with the requirements of the Exchange Act, the
registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


TIMBERLINE BANCSHARES, INC.




//ss John A. Linton                               Date   4/21/2000
     John A. Linton,  President




//ss Helen L. Gaulden                             Date   4/21/2000
     Helen L. Gaulden, Sr. V. P. & Treasurer