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

                                   FORM 10-Q
          (Mark  One)
          [  X  ]    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                For the quarterly period ended FEBRUARY 28, 1997

                                       OR
          [      ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                       For the transition period from to

                         Commission file number 0-19623

                             MIAMI SUBS CORPORATION
             (Exact name of registrant as specified in its charter)

        Florida                                               65-0249329
  (State or other jurisdiction of                          (I.R.S. Employer
  incorporation or organization)                           Identification No.)

             6300 N.W. 31st Avenue, Fort Lauderdale, Florida  33309
                    (Address of principal executive offices)
                                   (Zip Code)

                                 (954) 973-0000
              (Registrant's telephone number, including area code)

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

                                Yes    X     No

     Indicate the number of shares outstanding of each of the issuer's classes
of  common  stock,  as  of  the  latest  practicable  date.


      Class                                 Outstanding at April 7,  1997
Common Stock, $.01 par value                         28,244,340


PART  I.    FINANCIAL  INFORMATION
ITEM  1.  FINANCIAL  STATEMENTS.
<TABLE>
<CAPTION>

                                            MIAMI SUBS CORPORATION
                                         CONSOLIDATED BALANCE SHEETS
                                                 (UNAUDITED)



                                                                                   February 28,     May 31,
ASSETS                                                                                 1997           1996
--------------------------------------------------------------------------------  --------------  ------------
<S>                                                                               <C>             <C>

CURRENT ASSETS
Cash and cash equivalents (including unexpended marketing fund contributions of   $   2,339,000   $ 3,103,000 
   $651,000 and $525,000, respectively)
Notes and accounts receivable (net of allowances for uncollectible accounts of        1,924,000     2,250,000 
   $343,000 and $390,000, respectively)
Food and supplies inventories                                                           244,000       381,000 
Other                                                                                   370,000       332,000 
Total Current Assets                                                                  4,877,000     6,066,000 

Notes receivable                                                                      6,542,000     3,778,000 
Property and equipment - net                                                         14,733,000    17,955,000 
Intangible assets - net                                                               7,464,000     8,004,000 
Other                                                                                   482,000       558,000 

TOTAL                                                                             $  34,098,000   $36,361,000 

LIABILITIES AND SHAREHOLDERS' EQUITY
--------------------------------------------------------------------------------  --------------  ------------
CURRENT LIABILITIES
Accounts payable and accrued liabilities                                          $   4,950,000   $ 6,106,000 
Current portion of notes payable and capitalized lease obligations                    1,633,000     1,539,000 
Total Current Liabilities                                                             6,583,000     7,645,000 

Long-term portion of notes payable and capitalized lease obligations                  6,669,000     7,955,000 
Deferred franchise fees and other deferred income                                     1,989,000     1,712,000 
Accrued liabilities and other                                                         1,628,000     2,106,000 

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY
Series A Convertible Preferred Stock, $.01 par value,
   8,000,000 shares authorized; 1,005,500 shares outstanding at
   May 31, 1996, none outstanding at February 28, 1997                                                 10,000 
Common stock, $.01 par value; authorized 50,000,000 shares;
   28,244,340 shares outstanding at February 28, 1997                                   283,000       273,000 
Additional paid-in capital                                                           24,565,000    24,565,000 
Accumulated deficit                                                                  (7,056,000)   (7,342,000)
                                                                                     17,792,000    17,506,000 
Less note receivable from sale of stock                                                (563,000)     (563,000)
Total Shareholders' Equity                                                           17,229,000    16,943,000 

TOTAL                                                                             $  34,098,000   $36,361,000 
--------------------------------------------------------------------------------  --------------  ------------


See accompanying notes to consolidated financial statements.
</TABLE>




<TABLE>
<CAPTION>

                                     MIAMI SUBS CORPORATION
                                CONSOLIDATED STATEMENTS OF INCOME
                                           (UNAUDITED)






                                                               Three Months Ended
                                                               -------------------        
                                                                  February 28,      February 29,
REVENUES                                                              1997              1996
-------------------------------------------------------------  -------------------  -------------
<S>                                                            <C>                  <C>

Restaurant sales                                               $         6,397,000  $   7,424,000
Revenues from franchised restaurants                                     1,116,000      1,158,000
Net gain from sales of restaurants                                         227,000          8,000
Interest income                                                            139,000        103,000
Other revenues                                                             116,000         31,000
-------------------------------------------------------------  -------------------  -------------
Total                                                                    7,995,000      8,724,000
-------------------------------------------------------------  -------------------  -------------

EXPENSES
-------------------------------------------------------------  -------------------  -------------
Restaurant operating costs (including lease costs paid to
   Kavala, Inc. of $21,000 and $39,000, respectively)                    6,041,000      6,517,000
General, administrative and franchise costs                              1,225,000      1,523,000
Depreciation and amortization                                              446,000        477,000
Interest expense - net                                                     221,000        167,000
-------------------------------------------------------------  -------------------  -------------
Total                                                                    7,933,000      8,684,000
-------------------------------------------------------------  -------------------  -------------

Net income                                                     $            62,000  $      40,000
=============================================================  ===================  =============

Net income per common share and common share equivalents       $               .00  $         .00
=============================================================  ===================  =============

Weighted average number of common share and common share
  equivalents outstanding                                               28,248,000     26,907,000
=============================================================  ===================  =============



See accompanying notes to consolidated financial statements.
</TABLE>




<TABLE>
<CAPTION>

                                     MIAMI SUBS CORPORATION
                               CONSOLIDATED STATEMENTS OF INCOME
                                          (UNAUDITED)






                                                               Nine Months Ended
                                                               ------------------        
                                                                  February 28,     February 29,
REVENUES                                                              1997             1996
-------------------------------------------------------------  ------------------  -------------
<S>                                                            <C>                 <C>

Restaurant sales                                               $       22,818,000  $  22,896,000
Revenues from franchised restaurants                                    3,337,000      3,525,000
Net gain from sales of restaurants                                        884,000        110,000
Interest income                                                           395,000        361,000
Other revenues                                                            215,000        199,000
-------------------------------------------------------------  ------------------  -------------
Total                                                                  27,649,000     27,091,000
-------------------------------------------------------------  ------------------  -------------

EXPENSES
-------------------------------------------------------------  ------------------  -------------
Restaurant operating costs (including lease costs paid to
   Kavala, Inc. of $87,000 and $137,000, respectively)                 21,186,000     20,275,000
General, administrative and franchise costs                             4,043,000      4,641,000
Depreciation and amortization                                           1,440,000      1,413,000
Interest expense - net                                                    694,000        529,000
-------------------------------------------------------------  ------------------  -------------
Total                                                                  27,363,000     26,858,000
-------------------------------------------------------------  ------------------  -------------

Net income                                                     $          286,000  $     233,000
=============================================================  ==================  =============

Net income per common share and common share equivalents       $              .01  $         .01
=============================================================  ==================  =============

Weighted average number of common share and common share
  equivalents outstanding                                              28,250,000     26,904,000
=============================================================  ==================  =============



See accompanying notes to consolidated financial statements.
</TABLE>




<TABLE>
<CAPTION>

                                              MIAMI SUBS CORPORATION
                                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                   (UNAUDITED)


                                                                                Nine Months Ended
                                                                               -------------------         
                                                                                  February 28,       February 29,
OPERATING ACTIVITIES:                                                                 1997               1996
-----------------------------------------------------------------------------  -------------------  --------------
<S>                                                                            <C>                  <C>

Net income                                                                     $          286,000   $     233,000 
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization                                                           1,095,000       1,035,000 
Amortization of intangible assets                                                         345,000         378,000 
Net gain from sales of restaurants                                                       (884,000)       (110,000)
Changes in assets and liabilities:
(Increase) in accounts receivable                                                         (68,000)       (312,000)
Decrease in food and supplies inventories                                                 137,000               - 
(Increase) in other current assets                                                        (60,000)        (29,000)
Decrease (increase) in other assets                                                        76,000         (20,000)
(Decrease) in accounts payable and accrued liabilities                                 (1,874,000)        (71,000)
Increase (decrease) in deferred fees and other deferred income                            263,000        (586,000)
-----------------------------------------------------------------------------  -------------------  --------------
Net Cash Provided By (Used For) Operating Activities                                     (684,000)        518,000 
-----------------------------------------------------------------------------  -------------------  --------------

INVESTMENT ACTIVITIES:
Purchase of property and equipment                                                       (534,000)     (2,330,000)
Proceeds from sales of restaurants                                                        807,000         255,000 
Loans to franchisees and other                                                                  -         (29,000)
Payments received on notes receivable                                                     830,000         556,000 
-----------------------------------------------------------------------------  -------------------  --------------
Cash Provided By (Used For) Business Investment Activities                              1,103,000      (1,548,000)
-----------------------------------------------------------------------------  -------------------  --------------

FINANCING ACTIVITIES:
Repayment of debt                                                                      (1,183,000)     (1,242,000)
Proceeds from borrowings                                                                        -         795,000 
Proceeds from exercise of stock options/warrants                                                -          13,000 
-----------------------------------------------------------------------------  -------------------  --------------
Cash (Used For) Financing Activities                                                   (1,183,000)       (434,000)
-----------------------------------------------------------------------------  -------------------  --------------

(DECREASE) IN CASH                                                                       (764,000)     (1,464,000)

CASH AT BEGINNING OF PERIOD                                                             3,103,000       3,145,000 
-----------------------------------------------------------------------------  -------------------  --------------

CASH AT END OF PERIOD                                                          $        2,339,000   $   1,681,000 
=============================================================================  ===================  ==============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest                                                         $          696,000   $     545,000 
=============================================================================  ===================  ==============
Loans to franchisees in connection with sales of restaurants                   $        3,270,000   $     593,000 
=============================================================================  ===================  ==============

See accompanying notes to consolidated financial statements.
</TABLE>




                            MIAMI SUBS CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                 (UNAUDITED)

1.          BASIS  OF  PRESENTATION

In  the  opinion  of  management,  the  accompanying  unaudited  consolidated
financial  statements contain all adjustments, which are of a normal recurring
nature,  necessary for a fair presentation of the Company's financial position
and results of operations for the periods presented.  The financial statements
have been prepared by the Company pursuant to the rules and regulations of the
Securities  and Exchange Commission.  Accordingly, they do not include all the
information  and  footnotes  required  for  annual  financial statements.  The
financial  statements  included  herein should be read in conjunction with the
financial statements presented in the Company's Annual Report on Form 10-K for
the  year  ended  May  31,  1996.

Results  of  operations  reported  for  interim  periods  are  not necessarily
indicative  of  results  for  the  entire  fiscal  year.

     2.          ADOPTION  OF  NEW  ACCOUNTING  STANDARDS

In the first quarter of the current fiscal year, the Company adopted Statement
of  Financial  Accounting  Standards  (SFAS)  No.  121,  "Accounting  For  the
Impairment  of Long-Lived Assets and For Long-Lived Assets to be Disposed Of."
SFAS  No. 121 in general requires that such impaired assets be written down to
a reduced carrying value.  The adoption of SFAS No. 121 by the Company did not
result  in  a  write  down  of  such  assets.

In  the first quarter of the current fiscal year, the Company adopted SFAS No.
123,  "Accounting  For  Stock  Based  Compensation."   SFAS No. 123 in general
permits  stock  compensation  cost  to  be measured using either the intrinsic
value-based method of accounting prescribed by APB Opinion No. 25, "Accounting
for Stock Issued to Employees," or the fair value-based method of accounting. 
The  Company  elected  to  continue to use the intrinsic value-based method of
accounting  and  accordingly  will  provide the expanded pro forma disclosures
required  by  SFAS  No.  123  in  its  annual  financial  statements.

3.          REVENUES  FROM  FRANCHISED  RESTAURANTS

     Revenues  from  franchised  restaurants  consist  of  the  following:
<TABLE>
<CAPTION>



                                                      THREE MONTHS ENDED
                                                      -------------------        
                                                         February 28,      February 29,
                                                             1997              1996
----------------------------------------------------  -------------------  -------------
<S>                                                   <C>                  <C>

Royalties                                             $           896,000  $     947,000
Franchise and development fees                                    220,000        117,000
Net sublease rental income and area termination fees                    -         94,000
----------------------------------------------------  -------------------  -------------
Total                                                 $         1,116,000  $   1,158,000
====================================================  ===================  =============

                                                      NINE MONTHS ENDED
                                                      -------------------               
                                                      February 28,         February 29,
                                                                     1997           1996
----------------------------------------------------  -------------------  -------------
Royalties                                             $         2,796,000  $   2,797,000
Franchise and development fees                                    474,000        409,000
Net sublease rental income and area termination fees               67,000        319,000
----------------------------------------------------  -------------------  -------------
Total                                                 $         3,337,000  $   3,525,000
====================================================  ===================  =============
</TABLE>



     4.          INCOME  TAXES

The  Company  did  not  provide  for income taxes for the three and nine month
periods  ended February 28, 1997 and February 29, 1996 due to the availability
of  net  operating  loss  carry-forwards.

The  Company's  federal income tax returns for fiscal years 1991 through 1995,
inclusive,  have been examined by the Internal Revenue Service and the Company
has  recently received the agent's report of proposed adjustments.  The report
reflects  substantial  proposed  adjustments which the Company and its outside
counsel are currently reviewing.  Based on its preliminary review, the Company
anticipates  that  a  substantial portion of its net operating loss carryovers
may be absorbed by the proposed adjustments, however, the Company is unable at
this  time  to  determine  the  ultimate  potential  impact  of  the  proposed
adjustments  on  its overall tax liability.  The Company, through its counsel,
intends  to  appeal many of the proposed adjustments.  The examining agent has
recently  begun  an  examination  of  the Company's tax return for fiscal year
1996.

     5.          COMMITMENTS  AND  CONTINGENCIES

The  Company and its subsidiaries are parties to various legal actions arising
in the ordinary course of business as described in the Company's Annual Report
on  Form 10-K for the fiscal year ended May 31, 1996.  Other than as described
below,  there  have been no material developments in these legal proceedings. 
The Company is vigorously contesting these actions and currently believes that
the  outcome  of  such  cases  will  not have a material adverse effect on the
Company.

During  January,  1992,  the Company filed a Petition for Declaratory Judgment
against  the  Murray  Family  Trust/Kenneth  Dash  Partnership ("F/D"), in the
Superior  Court  Northern District of Hillsborough County, New Hampshire.  The
Company  sought  to  dissolve an alleged joint venture between the Company and
F/D  to  develop  Miami  Subs  restaurants  in  New  England.  F/D opposed the
dissolution,  counterclaimed, and sought damages arising from amounts expended
in developing new locations and lost profits from the termination of the joint
venture.    A  bench  trail  was completed in April 1995, and in July 1995 the
court  issued  its  ruling  in  favor of the Company on virtually all of F/D's
counterclaims,  except  that  the  court  denied  the  Company's  petition for
declaratory  judgement  and awarded F/D damages in the amount of $241,000 plus
costs and attorney fees allegedly incurred by the joint venture.  The case was
appealed  by  both  the  Company and F/D, and in November 1996, the appeal was
argued before the New Hampshire Supreme Court.  The Court has not yet rendered
a  ruling  on  the  appeal.

In  March  1992,  a  subsidiary of the Company filed an action for declaratory
relief  against  a third party seeking a determination that a letter of intent
executed  by  Miami  Subs,  Inc.  (n/k/a  B&B  Food  Ventures,  Inc.)  did not
constitute  a  binding  agreement  concerning  the  possible  granting  of  an
exclusive  area for development.  As a result of this lawsuit, the third party
filed  a  separate  lawsuit against the Company in which the plaintiffs allege
they  are  entitled  to  damages  for  breach  of  contract,  fraud,  tortious
inducement  to breach a contract and breach of fiduciary duty arising from the
Company's  alleged  failure  to  grant  the  plaintiffs  an  exclusive  area
development  right.    The  plaintiffs claim compensatory damages in excess of
$20.0  million  and punitive damages in excess of $20.0 million.  Discovery is
substantially completed.  The case has been schedule for trial in August 1997.
 The  Company  believes that it had no obligation to proceed to enter into any
agreements  with  the  plaintiffs  and  is  vigorously  contesting the action.

In  October  1996,  a  lawsuit was filed against the Company (Rafaele Cruz, as
Personal  Representative  of  the  Estate of Miguel Angel Rivera, deceased, v.
Miami  Subs  Corporation,  Broward  County  Circuit  Court, Case No. 96-14900)
seeking  damages  in  excess  of  $15,000  relating  to  an  incident  at  a
Company-operated  restaurant.    In addition, there have been inquiries of the
Company  by  counsel  representing  a party in a separate incident involving a
deceased  patron of a franchised restaurant.  The Company expects that both of
these  matters  will  be  handled  by  its  insurance  carrier.

Subsidiaries  of  the  Company  are  the  prime  lessee under various land and
building  leases for restaurants operated by the Company and its franchisees. 
A former Miami Subs restaurant which was sub-leased by a Company subsidiary to
a former franchisee is closed.  The lease currently terminates in 2010 and the
average  annual  base rent for the term is approximately $97,000.  The Company
subsidiary,  which remains obligated on the master lease with the landlord, is
attempting  to  negotiate  an  early  termination  of  the  lease.

6.          SHAREHOLDERS'  EQUITY  AND  EARNINGS  PER  SHARE

In  October  1996,  all shares of the Company's Series A Convertible Preferred
Stock  which  were  then  outstanding  were  automatically  converted  on  a
one-for-one  basis  into  Common  Stock  of  the  Company.

At  February  28, 1997, options and warrants representing a total of 5,180,000
shares  of  common  stock,  at  an  average  exercise  price  of  $2.72,  were
outstanding.

The  net  income  per share amounts are computed based on the weighted average
number  of  common  shares and common share equivalents outstanding during the
period,  computed  using  the treasury stock method.  Common share equivalents
include  convertible  preferred  stock,  options  and  warrants.

7.          RELATED  PARTY  TRANSACTIONS

Effective  January  1, 1997, the Company leased a vacant property to a company
which  is  owned  by  Gus  Boulis,  a director of Miami Subs Corporation.  The
Company believes that the terms of the lease are not materially different than
would  have  been  obtained  from a lease with unaffiliated parties on a stand
alone  basis.



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

INTRODUCTION

The Company's revenues and expenses are derived principally from operating and
franchising  Miami  Subs  Grill  restaurants.    Franchise  revenues  consist
principally  of initial franchise fees, area development fees, monthly royalty
fees,  and  sublease  rentals  (net  of  expense).    In  the normal course of
operations  and in conjunction with the Company's strategic decision to expand
through  franchising,  the  Company  has derived significant revenues from the
sale  of  Company  restaurants  to  franchisees.

Restaurant  operating  costs  include  food and paper costs, direct restaurant
labor and benefits, marketing fees, and all other direct costs associated with
operating the restaurants.  General, administrative and franchise costs relate
both  to  Company  owned restaurants and the Company's franchising operations.

The Company's revenues and expenses are directly affected by the number, sales
volumes, and profitability of its Company operated restaurants.  Revenues, and
to  a  lesser  extent expenses, are also affected by the number, sales volumes
and  profitability  of franchised restaurants.  Initial franchise fees and any
gains  on  sales  of  restaurants  are  directly  affected  by  the  number of
restaurants  opened  and  sold  during  the  period.

The  Company's  fiscal year ends on May 31.  The results of operations for the
three  and  nine months ended February 28, 1997 are not necessarily indicative
of  the  results  that  may  be  expected  for  the  Company's  fiscal  year.

The  Company's  profitability for the three and nine months ended February 28,
1997 resulted from non-recurring gains on the sale of certain Company operated
restaurants.    Although  the  Company  currently  intends  to sell additional
restaurants  in the future, there can be no assurance that any such sales will
be  consummated  or  that  gains  will  be realized.  The Company's ability to
become  and  sustain  profitability on an operating basis will be dependent on
improvement  of  sales  and  operating  margins  in  Company  and  franchised
restaurants,  expansion  of  its  franchise  base,  its  ability to reduce and
control  general  and  administrative  expenses,  and  on  the  success of its
existing  and  future  franchisees.

During  the  nine  months  ended  February 28, 1997, 14 franchised restaurants
opened,  one  Company  and  five  franchised  restaurants  closed,  12 Company
operated  restaurants were sold/transferred to franchisees, and one restaurant
was  reacquired  from  a  franchisee.    At  February 28, 1997, there were 185
restaurants  in  the system, consisting of 25 Company operated restaurants and
160  franchised restaurants.  At February 29, 1996, there were 167 restaurants
in  the  system,  consisting  of  29  Company  operated  restaurants  and  138
franchised  restaurants.

COMPARISON  OF  THREE  MONTHS  ENDED FEBRUARY 28, 1997 TO FEBRUARY 29, 1996

Total  Revenues

Total  Company revenues decreased 8.4% to $8.0 million in the third quarter of
the  current  year,  as  compared to $8.7 million in the third quarter of last
year.   The decrease in total revenues in the current period was primarily due
to  fewer  Company  operated  restaurants,  which  was  in  part  offset  by a
significant  increase  in  net  gains  from  the  sales  of  restaurants.
Restaurant  Sales

The  Company's  total  restaurant  sales decreased approximately 13.8% to $6.4
million in this year's third quarter, as compared to $7.4 million in the third
quarter  of  last  year.  The decline in sales in the current quarter resulted
from  a  net  reduction  in  the  number of Company operated restaurants and a
corresponding  decrease  of  approximately nine percent in weeks of restaurant
operations,  and  a  decline  in  same-store-sales.

At  the  beginning  of  the  current  year  quarter  the  Company  operated 28
restaurants  and  during  the  quarter  the  Company  sold/transferred  four
restaurants  to  franchisees and reacquired one restaurant from a franchisee. 
The Company operated 29 restaurants throughout the prior year's third quarter.

During  the  current  year's  third  quarter the Company continued a marketing
strategy  involving  price  discounting and couponing.  Despite such marketing
efforts,  same-store-sales  in  Company  operated  restaurants  declined  by
approximately 3.8% in the current quarter.  The Company is currently reviewing
its  marketing  programs and anticipates a revision of its strategy, including
reducing  the  prices  of  certain  products,  new  product  introductions and
modifications, and improvements to the level of service and overall operations
in its restaurants.  There can be no assurances that these new strategies will
be  successful.

At  February  28,  1997,  Company operated restaurants were located in Florida
(10),  Texas (6), Georgia (3), North Carolina (4), South Carolina (1), and New
York  (1).   Subsequent to the end of the current quarter, the Company sold to
franchisees  five  of  these  restaurants,  and the Company currently plans on
franchising up to 11 of its remaining Company operated restaurants.  There can
be  no  assurances  that  such  restaurants  will  be  franchised on terms and
conditions  acceptable  to  the  Company.

Revenues  From  Franchised  Restaurants

Revenues from franchised restaurants declined approximately 3.6% to $1,116,000
in  the  third  quarter  of the current year, as compared to $1,158,000 in the
prior  year's  third  quarter.    In the prior year third quarter, the Company
recognized income of $104,000 from the termination and cancellation of certain
area  development  agreements.    No such income was recognized in the current
quarter.

The  marketing strategy adopted by the Company and many of its franchisees has
focused  on  price discounting and couponing.  Despite such marketing efforts,
same-store-sales  in  franchised restaurants declined by approximately 7.0% in
the  current  quarter.    Despite  growth  in  the  franchise base, such sales
declines,  along  with the non-accrual of certain sub-lease income and royalty
fees  from  an  increased number of franchisees, continued to adversely affect
franchise  fee  revenues  in  the  current  quarter.

During the third quarter of the current year, seven new franchised restaurants
opened,  and  four  restaurants  previously  operated  by  the  Company  were
franchised.    Three  franchised restaurants closed during the quarter.  There
were 160 franchised restaurants in operation at February 28, 1997, as compared
to  138  franchised  restaurants  at  February  29,  1996.


System-Wide  Sales

System-wide  sales,  which  includes  sales  from  all  Company  operated  and
franchised  restaurants,  increased  by approximately 3.6% to $36.5 million in
this  year's  third quarter, as compared to $35.2 million in last year's third
quarter,  principally  reflecting the increase in the total number of units in
the system (185 at February 28, 1997 as compared to 167 at February 29, 1996).
 Same-store-sales  for  both  Company  and  franchised  units  in  the  system
decreased  by  approximately  6.5%  in  the  current  quarter.

Net  Gains  From  Sales  of  Restaurants

The  Company  sold four restaurants to franchisees during the third quarter of
the  current  year.    Gains  on  the sale of restaurants are dependent on the
Company's  basis  in  and  the  overall  performance of such units.  Any gains
realized  are  recorded  as  income  when  the sales are consummated and other
conditions  are  met,  including  the  adequacy  of  the  down payment and the
completion by the Company of its obligations under the contracts.  Total gains
recognized  in  the third quarter of the current year amounted to $227,000, as
compared  to $8,000 in the prior year third quarter.  Subsequent to the end of
the current quarter, the Company sold five restaurants to franchisees, with no
significant  gain  being  realized.    Although  the  Company  intends to sell
additional  restaurants, there can be no assurance that any such sales will be
consummated  or  that  gains  will  be  realized.

Other  Revenues

Other revenues increased in the third quarter of the current year primarily as
a  result  of  certain  vendor  revenues  which  were  received in the current
quarter.  However, total other revenues were adversely affected in the current
quarter due to costs associated with a vacant leased property.  The Company is
attempting  to  negotiate a termination of the lease on this property with the
landlord (see note 5. to the accompanying Consolidated Financial Statements).

Restaurant  Operating  Costs

Restaurant  operating  costs  increased  to approximately $6.0 million in this
year's  third  quarter,  as  compared  to  $6.5  million  in last year's third
quarter, and such costs as a percent of restaurant sales increased to 94.4% in
the  current quarter, as compared to 87.8% in the prior year's third quarter. 
The  increase in restaurant operating costs as a percent of sales was a result
of  lower  average  unit  sales and the impact of higher costs associated with
price discounting and couponing promotions offered during the current quarter,
and  higher  direct  operating  costs,  including  cost  of  sales  and labor.

The  Company  is addressing its restaurant operations and marketing strategies
and  anticipates  that the previous discounting and couponing strategy will be
significantly  reduced.  In addition to implementing improvements to the level
of  service  and  overall  operations  in its restaurants, the Company is also
considering  reducing  the  prices  of  certain  products  and  new  product
introductions  and  modifications in order to increase recurring visits by its
core  customers.    There  is  no  assurance that these new strategies will be
successful.

General,  Administrative  and  Franchise  Costs

General,  administrative  and  franchise  costs amounted to approximately $1.2
million or 15.3% of total revenues in the current quarter, as compared to $1.5
million  or  17.5%  of  total revenues in the prior year's third quarter.  The
Company  is  maintaining  strict  cost  controls  in all areas of its business
resulting  in  a  reduction  in  general  and  administrative costs, including
salaries,  general  marketing  and  outside  legal  costs.

Interest  Expense

Interest  expense  increased  to  $221,000  in  this year's third quarter, as
compared to $167,000 in the prior year's third quarter, principally reflecting
additional  debt  outstanding in the current quarter ($8.3 million at February
28,  1997,  as  compared  to  $7.3  million  at  February  29,  1996).

Provision  For  Income  Taxes

A  tax  provision  was  not  provided for in the current or prior year periods
because  of  available  net  operating  loss carryforwards (see Note 4. to the
Consolidated  Financial  Statements).

COMPARISON  OF  NINE  MONTHS  ENDED  FEBRUARY  28, 1997 TO FEBRUARY 29, 1996

Total  Revenues

Total  Company  revenues  increased to $27.6 million in the current nine month
period,  as  compared to $27.1 million in the same period last year.  Although
restaurant  sales  and  franchise  revenues  were lower in the current period,
there  was  a  significant  increase  in  net  gains  from  sales  of  Company
restaurants  resulting  in  the 2.1% increase in total revenues as compared to
the  year  earlier  period.

Restaurant  Sales

The  Company's  total  restaurant  sales decreased approximately 0.3% to $22.8
million  in the current nine month period, as compared to $22.9 million in the
same  period  last  year.    Although  total  sales  from  all  non-comparable
Company-operated  units increased during the current period due to a change in
the  unit  portfolio  and  the  timing  of  unit  dispositions/acquisitions, a
decrease  in  same  store  sales  in  comparable  units  of approximately 3.2%
resulted  in  a  net decrease in total restaurant sales in the current period.

At  the  beginning  of  the  current  fiscal  year,  the  Company  operated 37
restaurants,  and  during  the  current  nine  month  period  the  Company
sold/transferred 12 restaurants to franchisees, reacquired one restaurant from
a  franchisee, and closed one restaurant.  At the beginning of the prior year,
the  Company operated 30 restaurants, and during the period the Company opened
one new restaurant and sold/transferred two restaurants to franchisees.  Total
weeks  of  restaurant  operations  were  up  approximately  two percent in the
current  nine  month  period, as compared to the prior year nine month period.

The  Company  has  attempted  to  improve  sales  and  customer traffic in its
restaurants  with a marketing strategy principally involving price discounting
and  couponing.   Despite these marketing efforts, same-store-sales in Company
operated  restaurants  have  declined  since  the first quarter of the current
year,  resulting  in  a  decrease  in  same store sales in comparable units of
approximately  3.2%  for  the  current  nine  month  period.    The Company is
currently  reviewing  its marketing programs and anticipates a revision of its
strategy,  including  reducing  the  prices  of  certain products, new product
introductions  and modifications, and improvements to the level of service and
overall  operations in its restaurants.  There can be no assurances that these
new  strategies  will  be  successful.

Subsequent  to  February 28, 1997, the Company sold to franchisees five of its
restaurants,  and  the  Company currently plans on franchising up to 11 of its
remaining  Company operated restaurants.  There can be no assurances that such
restaurants  will  be  franchised  on  terms  and conditions acceptable to the
Company.

Revenues  From  Franchised  Restaurants

Revenues  from  franchised  restaurants  declined  approximately  5.3% to $3.3
million  in  the current nine month period, as compared to $3.5 million in the
year  earlier  period.    The  prior year nine month period included income of
$324,000  associated  with the termination of area development agreements with
franchisees.    No  such  income  was  recognized  in  the  current  period.

The  marketing strategy adopted by the Company and many of its franchisees has
focused  on price discounting and couponing.  Despite such marketing programs,
same-store-sales  in  franchised  restaurants  decreased by approximately 3.7%
during  the  current nine month period.  Despite growth in the franchise base,
such  sales  declines,  along with the non-accrual of certain sub-lease income
and  royalty  fees from an increased number of franchisees, adversely affected
franchise  fee  revenues  in  the  current  nine  month  period.

During  the  current  nine  month period, 14 franchised restaurants opened, 12
restaurants  previously  operated  by  the  Company  were franchised, and five
franchised  restaurants  closed.    There  were  160 franchised restaurants in
operation  at  February 28, 1997, as compared to 138 franchised restaurants at
February  29,  1996.

System-Wide  Sales

System-wide  sales,  which  includes  sales  from  all  Company  operated  and
franchised  restaurants,  increased by approximately 6.9% to $112.8 million in
the  current  nine  month  period,  as  compared to $105.6 million in the same
period  last  year, principally reflecting the increase in the total number of
units  in  the system (185 at February 28, 1997 as compared to 167 at February
29,  1996).    Same-store-sales  for  both Company and franchised units in the
system  decreased  by  approximately  3.8%  in  the current nine month period.

Net  Gains  From  Sales  of  Restaurants

The  Company sold/transferred 12 restaurants to franchisees during the current
nine  month  period.    Gains  on the sale of restaurants are dependent on the
Company's  basis  in  and  the  overall  performance of such units.  Any gains
realized  are  recorded  as  income  when  the sales are consummated and other
conditions  are  met,  including  the  adequacy  of  the  down payment and the
completion by the Company of its obligations under the contracts.  Total gains
recognized  in the current nine month period amounted to $884,000, as compared
to  $110,000  in the prior year nine month period.  Subsequent to February 28,
1997,  the  Company  sold  five restaurants to franchisees with no significant
gain  being  realized.    Although  the  Company  intends  to  sell additional
restaurants, there can be no assurance that any such sales will be consummated
or  that  gains  will  be  realized.

Restaurant  Operating  Costs

Restaurant  operating  costs  increased  to approximately $21.2 million in the
current  nine  month  period, as compared to $20.3 million in the year earlier
period.  Such costs as a percent of restaurant sales increased to 92.8% in the
current  nine  month period, as compared to 88.6% in the prior year nine month
period.    The  increase  in  restaurant operating costs was a result of lower
average  unit  sales  and  the  impact  of  higher costs associated with price
discounting  and  couponing  promotions offered during the current period, and
higher  direct  operating  costs,  including  cost  of  sales  and  labor.

The  Company  is addressing its restaurant operations and marketing strategies
and  anticipates  that the previous discounting and couponing strategy will be
significantly  reduced.  In addition to implementing improvements to the level
of  service  and  overall  operations  in its restaurants, the Company is also
considering  reducing  the  prices  of  certain  products  and  new  product
introductions  and  modifications in order to increase recurring visits by its
core  customers.    There  is  no  assurance that these new strategies will be
successful.

General,  Administrative  and  Franchise  Costs

General,  administrative  and  franchise  costs amounted to approximately $4.0
million  or  14.6%  of  total  revenues  in  the current nine month period, as
compared  to  $4.6  million  or 17.1% of total revenues in the prior year nine
month period.  The Company is maintaining strict cost controls in all areas of
its  business  resulting  in  a  reduction  in  administrative costs including
salaries,  general  marketing  and  outside  legal  costs.

Interest  Expense

Interest  expense  increased to $694,000 in the current nine month period, as
compared  to  $529,000  in the prior year nine month period, reflecting higher
average  debt  levels  in  the  current  period.

Provision  For  Income  Taxes

A  tax  provision was not provided for in the current or prior year nine month
periods  because of available net operating loss carryforwards (see Note 4. to
the  Consolidated  Financial  Statements).

LIQUIDITY  AND  CAPITAL  RESOURCES

During  the current nine month period, the Company's principal sources of cash
were  from  earnings before depreciation and amortization and gains from sales
of  restaurants,  totaling approximately $842,000, from the repayment of notes
receivable  totaling  approximately  $830,000  and  proceeds  from  sales  of
restaurants  totaling approximately $807,000.  The Company's principal uses of
cash during the current period were for property additions and improvements of
approximately $534,000, scheduled debt repayments of approximately $1,183,000,
and  a  reduction  in  accounts  payable  and  accrued  liabilities.

Cash  and cash equivalents at February 28, 1997, amounted to $2,339,000 (which
includes  unexpended marketing fund contributions of $651,000), as compared to
$3,103,000  (including $525,000 in unexpended marketing fund contributions) at
the  beginning  of  the year, and $1,681,000 (including $463,000 in unexpended
marketing  fund  contributions)  one  year  ago.    At  February 28, 1997, the
Company's working capital deficiency was $1,706,000, as compared to $1,579,000
at  the beginning of the current fiscal year and $2,006,000 one year ago.  The
Company  has  been  able  to operate with a working capital deficiency because
restaurant  operations are conducted primarily on a cash basis, rapid turnover
and  frequent  deliveries  allow  a  limited  investment  in  inventories, and
accounts payable for food, beverages and supplies usually become due after the
receipt  of  cash  from  the  related  sales.
At  February  28,  1997,  the  Company's  assets  include  a non-recourse note
receivable  in  the  amount  of  approximately  $1,270,000 which is secured by
1,325,000  shares of common stock of the Company.  The note was originally due
on  July  1, 1996 and has been formally extended by the Company to January 31,
1997.  The Company expects that the maturity date of the note will be extended
for an additional period of up to one year, and accordingly, the note has been
classified  as  long-term  at  February  28,  1997.  At February 28, 1997, the
quoted market price of the common stock which is pledged as collateral for the
note  was  approximately  $787,000.

In  September  1996,  the  Company announced a revision of its growth strategy
which  will  focus  on  expanding  the  restaurant  chain  principally through
franchised  restaurants.    In  addition to continuing to expand its franchise
base  through  new traditional and non-traditional franchised restaurants, the
new  strategy  also  involved  the franchising of many of the Company operated
restaurants.    During  the  first  nine months of the current fiscal year, 12
Company  operated  restaurants  were  sold/transferred  to  franchisees  and,
subsequent  to February 28, 1997, five additional Company operated restaurants
were  sold  to  franchisees.    Although  the  Company  believes that this new
strategic  direction  will  help to improve its future operating results, cash
flow,  and  liquidity,  there  are  no  assurances  that  such  plans  will be
successful  or  that  additional  sales  of  restaurants  will be consummated.

In  connection  with  the  planned  sale  of Company operated restaurants, the
Company  typically provides financing for the restaurant and leases/sub-leases
the property to the franchisee.  Accordingly, the Company would be susceptible
to  default  of  the  note  and lease/sub-lease by the franchisee.  During the
first  nine months of the current fiscal year, total new financing provided by
the  Company  to franchisees who acquired restaurants from the Company totaled
approximately  $3.3  million.    One  Company  restaurant  which was sold to a
franchisee  in  June 1996, was reacquired by the Company in February 1997.  If
the  sale of additional restaurants are consummated on terms acceptable to the
Company,  the  Company's  working  capital  position  and restaurant operating
margins  are  expected to improve, royalty and interest income would increase,
while  at  the  same  time  restaurant  sales and total Company revenues would
decrease.    There  can be no assurances however that any future sales will be
consummated.

In  addition to scheduled debt maturities/repayments during the balance of the
current  fiscal year of approximately $313,000 (and approximately $1.7 million
in  fiscal  year  1998), the Company's capital requirements for the balance of
fiscal  year  1997  relate  primarily  to  necessary  capital  improvements to
existing  restaurants  and  possible  further  enhancements  to  corporate and
restaurant  management information systems.  Such expenditures will be made as
required, and will take into consideration the Company's current liquidity and
working  capital  positions  and anticipated future cash flows from operations
and  other  sources.

The  Company expects that competition in the quick-service restaurant industry
will  continue  to  be  intense  and will remain so in the foreseeable future,
resulting  in  continued pressure on sales and margins, and slower development
of  traditional  restaurants  by  franchisees.   Accordingly, emphasis will be
placed  on  continuing  to  franchise  Company  restaurants,  expanding
non-traditional  franchised  restaurants,  improving  operations  in  all
restaurants, developing new products, revising and enhancing the effectiveness
of marketing programs, and overall improvement and possible refinements to the
entire  system.

As  of  February  28,  1997, the Miami Subs restaurant system consisted of 185
restaurants,  of  which  126  of  the  restaurants were located in Florida, 55
restaurants were located in 16 other states, and four restaurants were located
in  Ecuador.    Of  these  restaurants,  25 were Company operated and 160 were
franchised.    The  Company  plans to continue to reduce the current number of
Company  operated  restaurants  by selling certain restaurants to franchisees,
and intends to focus on franchise development, with the objective of expanding
the  franchise  system  in  existing  markets  as  well  as  nationally  and
internationally.   In part due to the limited number of restaurants located in
other  states, the restaurants operating outside of Florida have generally not
been  as successful as the restaurants operating in Florida.  Additionally, as
a  result  of the current concentration of restaurants in Florida, the Company
and  its  Florida  franchisees  could be more severely affected by any adverse
economic  conditions  in  Florida than would a more geographically diversified
company.

At  February  28, 1997, franchisees operated 160 of the 185 restaurants in the
system, and the Company currently plans on franchising up to 16 of its Company
operated restaurants (five of which were franchised subsequent to February 28,
1997).    The  Company  receives  royalty and advertising fees from franchised
restaurants,  and  also receives lease/sub-lease rental income from certain of
these franchised restaurants.  In addition, the Company has guaranteed certain
third  party  equipment  and  real  estate  leases for certain franchisees and
typically  finances  the sale of Company-operated restaurants to franchisees. 
Accordingly,  the  Company's  success  and  future  profitability  will  be
substantially  dependent  on the management skills and success of its existing
and  future  franchisees,  and expansion of the chain will be dependent on the
Company's  ability  to  attract  qualified  franchisees  who  will  be able to
successfully develop and operate restaurants.  Subsidiaries of the Company are
the  prime  lessee  under  various  land  and  building leases for restaurants
operated  by  the  Company and its franchisees.  A Miami Subs restaurant which
was sub-leased by a Company subsidiary to a former franchisee has closed.  The
lease  currently  terminates  in 2010 and the average annual base rent for the
term  is  approximately  $97,000.    The  Company  subsidiary,  which  remains
obligated on the master lease with the landlord, is attempting to negotiate an
early  termination  of  the  lease.

Seasonality

The  Company  does  not  expect  seasonality  to  affect  its  operations in a
materially adverse manner.  However, the Company's restaurant sales during its
first and fourth fiscal quarters have historically been higher than its second
and  third  quarters.

Adoption  of  New  Accounting  Standards

In the first quarter of the current fiscal year, the Company adopted Statement
of  Financial  Accounting  Standards  (SFAS)  No.  121,  "Accounting  For  the
Impairment of Long-Lived Assets and For Long-Lived Assets to be Disposed Of." 
SFAS  No. 121 in general requires that such impaired assets be written down to
a reduced carrying value.  The adoption of SFAS No. 121 by the Company did not
result  in  a  write  down  of  such  assets.

In  the first quarter of the current fiscal year, the Company adopted SFAS No.
123,  "Accounting  For  Stock  Based  Compensation."   SFAS No. 123 in general
permits  stock  compensation  cost  to  be measured using either the intrinsic
value-based method of accounting prescribed by APB Opinion No. 25, "Accounting
for Stock Issued to Employees," or the fair value-based method of accounting. 
The  Company  elected  to  continue to use the intrinsic value-based method of
accounting  and  accordingly  will  provide the expanded pro forma disclosures
required  by  SFAS  No.  123  in  its  annual  financial  statements.

PART  II.    OTHER  INFORMATION
ITEM  L.    LEGAL  PROCEEDINGS

Reference  is  made  to  Part  I,  Item 3, Legal Proceedings, in the Company's
Annual  Report  on  Form
10-K for the fiscal year ended May 31, 1996 for a description of certain legal
proceedings  involving the Company.  Other than as described below, there have
been  no  material  developments  in  these legal proceedings.  The Company is
vigorously contesting these actions and currently believes the outcome of such
cases  will  not  have  a  material  adverse  effect  on  the  Company.

During  January,  1992,  the Company filed a Petition for Declaratory Judgment
against  the  Murray  Family  Trust/Kenneth  Dash  Partnership ("F/D"), in the
Superior  Court  Northern District of Hillsborough County, New Hampshire.  The
Company  sought  to  dissolve an alleged joint venture between the Company and
F/D  to  develop  Miami  Subs  restaurants  in  New  England.  F/D opposed the
dissolution,  counterclaimed, and sought damages arising from amounts expended
in developing new locations and lost profits from the termination of the joint
venture.    A  bench  trail  was completed in April 1995, and in July 1995 the
court  issued  its  ruling  in  favor of the Company on virtually all of F/D's
counterclaims,  except  that  the  court  denied  the  Company's  petition for
declaratory  judgement  and awarded F/D damages in the amount of $241,000 plus
costs and attorney fees allegedly incurred by the joint venture.  The case was
appealed  by  both  the  Company and F/D, and in November 1996, the appeal was
argued before the New Hampshire Supreme Court.  The Court has not yet rendered
a  ruling  on  the  appeal.

In  March  1992,  a  subsidiary of the Company filed an action for declaratory
relief  against  a third party seeking a determination that a letter of intent
executed  by  Miami  Subs,  Inc.  (n/k/a  B&B  Food  Ventures,  Inc.)  did not
constitute  a  binding  agreement  concerning  the  possible  granting  of  an
exclusive  area for development.  As a result of this lawsuit, the third party
filed  a  separate  lawsuit against the Company in which the plaintiffs allege
they  are  entitled  to  damages  for  breach  of  contract,  fraud,  tortious
inducement  to breach a contract and breach of fiduciary duty arising from the
Company's  alleged  failure  to  grant  the  plaintiffs  an  exclusive  area
development  right.    The  plaintiffs claim compensatory damages in excess of
$20.0  million  and punitive damages in excess of $20.0 million.  Discovery is
substantially  completed,  and  the case has been schedule for trial in August
1997.  The Company believes that it had no obligation to proceed to enter into
any  agreements  with  the plaintiffs and is vigorously contesting the action.

In  October  1996,  a  lawsuit was filed against the Company (Rafaele Cruz, as
Personal  Representative  of  the  Estate of Miguel Angel Rivera, deceased, v.
Miami  Subs  Corporation,  Broward  County  Circuit  Court, Case No. 96-14900)
seeking  damages  in  excess  of  $15,000  relating  to  an  incident  at  a
Company-operated  restaurant.    In addition, there have been inquiries of the
Company  by  counsel  representing  a party in a separate incident involving a
deceased  patron of a franchised restaurant.  The Company expects that both of
these  matters  will  be  handled  by  its  insurance  carrier.

ITEM  5.    OTHER  INFORMATION

The  Boards  of  the  Nasdaq  Stock  Market  and  the  National Association of
Securities  Dealers  ("NASD")  have  recently  approved substantial changes to
Nasdaq's  listing qualification standards.  One of the changes approved by the
Boards  was  the  elimination of the alterative to the $1.00 minimum bid price
requirement,  which  would  require  all  Nasdaq-listed issues to trade for at
least  $1.00.  Previously, companies whose stock fell below $1.00 could remain
listed  if  they  met  certain  alternative  tests.   The new listing standard
changes  are  to  be  phased  in  over a six-month period and such changes are
subject  to  approval  by the Securities and Exchange Commission ("SEC").  The
Company  currently  does  not meet the new recommended standard and if the new
standard  is approved by the SEC, the Company's securities would be subject to
de-listing  if  it  is  unable to come into compliance within recommended time
periods.

ITEM  6.    EXHIBITS  AND  REPORTS  ON  FORM  8-K.

(a)        Exhibits.
          Index  to  Exhibits  on  Page  20.

(b)        Reports  on  Form  8-K
     NONE



                                 SIGNATURES


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



                                                  MIAMI  SUBS  CORPORATION



Date:  April  7,  1997                    By:    /s/  Jerry  W.  Woda
                                                 JERRY W. WODA
                                                 Senior Vice President,
                                                 Chief Financial Officer, and
                                                 Pricipal Accounting Officer


<TABLE>
<CAPTION>

                            MIAMI SUBS CORPORATION

                              INDEX TO EXHIBITS


Exhibit
Number                                    Description                Page No.
-------  ----------------------------------------------------------  --------
<C>      <S>                                                         <C>



    10.  Letter Agreement Dated March 13, 1997 Concerning the         21 - 23
            Resignation of Thomas J. Russo as an Officer, Director,
            and Employee of the Company
=======  ==========================================================  ========
</TABLE>