FORM 10-K  

              SECURITIES AND EXCHANGE COMMISSION

                     Washington, DC 20549

[ X ]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
        SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]

For the fiscal year ended   December 31, 1995               

                              OR

[   ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
        SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

For the transition period ended                             

Commission File Number          1-7211                      

                    Ionics, Incorporated                    
     (Exact name of registrant as specified in it charter)

            Massachusetts                    04-2068530     
   State or other jurisdiction of      (I.R.S. Employer 
   incorporation or organization        Identification Number)

 65 Grove Street, Watertown, Massachusetts        02172     
(Address of principal executive offices)        (Zip Code)

Registrant's telephone number, including area code: 617-926-2500


Securities registered pursuant to Section 12(b) of the Act:

   Title of each class         Name of each exchange on which registered

Common Stock, $1 par value              New York Stock Exchange 

       Securities registered pursuant to Section 12(g) of the Act:

                                  None                           
                            (Title of Class)

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 by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's
knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.      [X]
1/



State the aggregate market value of the voting stock held by
non-affiliates of the registrant.  The aggregate market value
shall be computed by reference to the price at which the stock
was sold, or the average bid and asked prices of such stock, as
of a specified date within 60 days prior to the date of filing.
The aggregate market value of the voting stock held by non-
affiliates as of March 15, 1996 was $585,000,113 (14,355,831
shares at $40.75 per share) (includes shares owned by a trust
for the indirect benefit of a non-employee director, and by a
trust for the indirect benefit of a spouse of a non-employee
director).


          (APPLICABLE ONLY TO CORPORATE REGISTRANTS)

     Indicate the number of shares outstanding of each of the
registrant's classes of common stock, as of the latest
practicable date.  As of March 15, 1996, 14,961,285 shares of
Common Stock, $1 par value, were issued and outstanding.

              DOCUMENTS INCORPORATED BY REFERENCE

Portions of 1995 Annual Report to Stockholders     Parts I, II 
                                                        and IV

Portions of Definitive Proxy Statement for 
the Annual Meeting of Stockholders to be held 
on May 2, 1996                                     Part III






















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                            PART I

Item 1.  BUSINESS

     Ionics, Incorporated ("Ionics," the "Company," or the
"Registrant") is a leading water purification company engaged
worldwide in the supply of water and of water treatment
equipment through the use of proprietary separations
technologies and systems.  Ionics' products and services are
used by the Company or its customers to desalt brackish water
and seawater, to purify and supply bottled water, to treat
water in the home, to manufacture and supply water treatment
chemicals and ultrapure water, to process food products,
recycle and reclaim process water and wastewater, and to
measure levels of water-borne contaminants and pollutants.  The
Company's customers include industrial companies, consumers,
municipalities and utilities.

     The Company's business activities are divided into three
segments:  Membranes and Related Equipment, Water, Food and
Chemical Supply, and Consumer Products, which in 1995 accounted
for approximately 52%, 26% and 22% of revenues, respectively.
Approximately 39% of the Company's 1995 revenues were derived
from foreign sales or operations.  Since 1985, the Company has
pursued a strategy of expanding beyond its traditional focus of
selling desalination plants and equipment by owning and
operating its own equipment to produce and sell water, food and
chemicals.  In 1995, the Water, Food and Chemical Supply and
Consumer Products business segments accounted for 63% of the
Company's earnings before interest and taxes.  

     Over forty years ago, the Company pioneered the
development of the ion-exchange membrane and the
electrodialysis process.  Since that time, the Company has
expanded its separations technology base to include a number of
membrane and non-membrane-based separations processes which the
Company refers to as "The Ionics ToolboxSM."  These separations
processes include electrodialysis reversal (EDR), reverse
osmosis (RO), ultrafiltration (UF) and microfiltration (MF),
electrodeionization (EDI), electrolysis, ion-exchange, carbon
adsorption, and thermal processes such as evaporation and
crystallization, as well as solvent extraction and recovery
processes.  The Company believes that it is the world's leading
manufacturer of ion-exchange membranes and of membrane-based
systems for the desalination of water.  

     The Company was incorporated in Massachusetts in 1948.
The Company's principal executive offices are located at 65
Grove Street, Watertown, Massachusetts 02172.

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                              I-1






Financial Information About Business Segments

     The information contained in Note 14 of Notes to
Consolidated Financial Statements contained in the Company's
Annual Report to Stockholders for the year ended December 31,
1995 is incorporated herein by reference.

Membranes and Related Equipment

     The Company's Membranes and Related Equipment business
segment, which accounted for approximately 52% of revenues in
1995 and provides membrane-based and other advanced technology
systems to the municipal and industrial markets, is divided
into three market areas:  desalination and related water
treatment equipment; wastewater treatment equipment; and
ultrapure water equipment.

     1.  Desalination and Related Water Treatment Equipment

     Opportunities for the sale of desalination and related
water treatment equipment arise from changes in the needs of
people and municipalities, from industrial shifts and growth,
and from a need to avert environmental concerns.  With less
than 1% of the total water on the planet fresh and usable,
desalination has played an important role in creating new water
sources.

     The Company sells a wide spectrum of products and systems
to serve this market which utilize technologies including
electrodialysis reversal, ion exchange, electrodeionization,
reverse osmosis, ultrafiltration and carbon adsorption.
Depending on the customers needs, the Company provides
standardized versions of systems utilizing one or more of the
technologies mentioned or can supply complete turnkey plants
that may include standardized models as well as peripheral
water treatment equipment, complete engineering services,
process and equipment design, project engineering,
commissioning, operator training and field service.









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                              I-2





     2. Wastewater Treatment Equipment

     The market for wastewater treatment, recycle and reuse has
shown significant growth as world demand for water of specified
quality continues to increase and as regulations limiting waste
discharges to the environment continue to mount.  The
wastewater market is increasingly driven by the concept of
Total Water ManagementSM, which involves the recognition that
the water streams which enter, leave or become part of a
process can be managed to achieve overall economic
efficiencies.  Ionics services the wastewater market with brine
concentrators and crystallizers, traditional wastewater
treatment equipment, special electrodialysis reversal membrane-
based concentrators for recycle and reuse, and pollution-
monitoring analyzers for measurement of water contaminants.

     The Company designs, engineers and constructs brine
concentrators, evaporators and crystallizers which are used to
clean, recover and recycle wastewater, particularly in zero
liquid discharge industrial uses.  Such systems may also
incorporate electrodialysis reversal membrane systems as
preconcentrators.  Ionics also holds an exclusive license for a
patented solvent extraction technology known as B.E.S.T. (Basic
Extraction Sludge Technology), which separates contaminated
sludges, sediments and soils into oil, water and solids and has
potential use for cleanup of toxic organic materials
at contaminated sites.

     Ionics also designs, engineers and constructs customized
systems for industrial wastewater customers which may include
conventional treatment systems as well as advanced separation
technologies such as electrodialysis reversal, reverse osmosis,
electrolysis and microfiltration.  Typical industrial customers
are power stations, chemical and petrochemical plants, 
metal-working and automobile factories, textile manufacture and
a variety of other industrial applications.  The Company also
provides custom and packaged sewage treatment systems for
municipalities.

     The Company sells instruments to measure water quality for
industrial and government customers.  The products which are
used both in the laboratory and on-line measure total carbon,
total organic carbon, chemical oxygen demand and total oxygen
demand.  The Company also sells instruments for measurement of
dissolved metals which are sensitive to the part-per-billion
range and specific chemical analyzers for ammonia, phosphates,
nitrates and chlorine.



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                              I-3






     3. Ultrapure Water Equipment

     Ultrapure water, which has been purified by a series of
processes to the degree that remaining impurities are measured
in parts per billion or trillion, is required by the
semiconductor industry and for other specialized industrial
uses.  The demand for technologically advanced ultrapure water
equipment and systems has increased as the industries which use
ultrapure water have become more knowledgeable about their
quality requirements.  The semiconductor industry in particular
has increasingly demanded higher purity water as the circuits
on silicon wafers have become more densely packed.

     The recent increasing worldwide demand for computer chips
has sparked a worldwide boom in the construction of fabrication
facilities and the associated need for ultrapure water
equipment.  The Company supplies sophisticated ultrapure water
systems to the semiconductor, electronics and power industries
which utilize a combination of electrodialysis reversal, ion
exchange, electrodeionization, reverse osmosis and 
ultrafiltration technologies.  These systems are either
trailer-mounted or land-based and vary from standardized
modules to large multimillion dollar systems depending on the
customer's requirements.

Water, Food and Chemical Supply

     The Water, Food and Chemical Supply business segment
accounted in 1995 for approximately 26% of the Company's
revenues (commencing in 1994, revenues from the sale of bleach
and bleach-based cleaning products for the consumer market have
been moved from this segment to the Consumer Products segment.
As a result, certain prior year amounts in the financial
statements have been reclassified to conform to the current
year's presentation).  The Company's strategy is to sell, where
appropriate, water, food products and chemicals produced by its
membrane-based equipment, rather than selling the equipment
itself.  The water, food and chemical supply business segment
can be divided into four market areas:  ultrapure water supply;
municipal water supply; chemical supply; and food processing. 









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                              I-4



     1. Ultrapure Water Supply

     In industries such as power generation, semiconductors,
pharmaceuticals and biotechnology, ultrapure water (water in
which the impurities have been reduced to concentrations as low
as several parts per billion) is critical to product quality
and yield.  In the electric power industry, ultrapure boiler
feedwater minimizes corrosion, inefficiency and downtime in
steam boilers and turbines.  Depending on the composition and
quantity of the impurities to be removed or treated, any one of
several membrane separations methods can be utilized to provide
ultrapure water to the customer.  Ionics has pioneered in the
application of three membrane technologies (EDR, RO and UF)
combined together in a mobile system called the "triple
membrane" trailer, which the Company believes to be the most
advanced technology used in the commercial processing of
ultrapure water.  Ionics provides ultrapure water services and
the production and sale of ultrapure water from trailer-mounted
units at the customer sites.

     Ionics has also commercially implemented its new
electrodeionization (EDI) technology in the production of
ultrapure water.  EDI is a continuous, electrically driven,
membrane-based water purification process which produces
ultrapure water without the use of the strong chemical
regenerants, such as sulfuric acid and caustic soda, which are
commonly required.  The Company's new TMT-II trailers utilize a
combination of EDI, RO and UF technologies to produce ultrapure
water.

     At the end of 1995, the Company had a total capacity,
installed or under construction, of approximately 9,000 gallons
per minute for the production of ultrapure water under long-
term contracts with various industries.

     In January 1996, the Company acquired Apollo Ultrapure
Water Systems, Inc., based in Pico Rivera, California, just
outside of Los Angeles.  This acquisition will permit the
Company to provide additional resources to service the growing
Southern California ultrapure water market.

     The Company serves the ultrapure water market from its
headquarters facilities in Watertown, Massachusetts, through
the Ionics Pure Solutions division in Phoenix, Arizona, the
Ionics Ahlfinger Water Company division in Dallas, Texas; and
through the following subsidiaries:  Ionics Apollo Ultrapure
Water Systems, Inc., Pico Rivera, California; Ionics Ultrapure
Water Corporation, Campbell, California; Ionics (U.K.) Limited,
London, England; Ionics Italba, S.p.A., Milan, Italy; and Eau
et Industrie, Paris, France.


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                              I-5




     2. Municipal Water Supply  

     Ionics' position in water supply as a seller of purified
or treated water has evolved from its traditional role as a
supplier of water treatment equipment.  In certain situations,
opportunities are available for the Company to provide a
complete service package involving financing, construction,
operation and maintenance of water treatment facilities.

     Ionics, through its wholly owned subsidiary, Ionics
Iberica, S.A., owns and operates a 5.5 million gallon per day
capacity brackish water EDR facility and an RO seawater
facility on Grand Canary Island, Spain.  Under long-term
contracts, the Company is selling the desalted water from both
facilities to the local water utility for distribution.  In
1995, the Company contracted with the water utility to expand
its seawater RO facility from a capacity of approximately 2.2
million gallons per day to approximately 3.6 million gallons
per day.

     The Company's wholly owned subsidiary, Ionics (Bermuda)
Ltd., owns and operates a 600,000 gallon per day EDR brackish
water desalting plant on the island of Bermuda.  This plant
supplies fresh water under a long-term contract with Watlington
Waterworks Ltd., a  Bermuda corporation partially owned by
Ionics.

     The Company financed, constructed, owns and operates a
seawater RO desalination facility in Santa Barbara, California.
The facility began operation in March 1992, has the capacity to
produce 7,500 acre-feet per year (approximately 6.7 million
gallons per day) of desalinated water, and is expandable to
10,000 acre-feet per year.  Under the terms of the Company's
contract with the City, the City can either purchase water from
the Company or, under conditions in which the City deems it
unnecessary to purchase water, pay the Company a "stand-by fee"
during the contract's five-year term and, if the City elects to
continue, a five-year extension term.  The City has placed the
facility on "stand-by" status because of the alleviation of the
area's drought.  At the end of the initial five-year term, the
City will have the right to renew the contract for another
five-year term, purchase the facility from the Company, or
direct the Company to remove the facility (most of which is
housed in trailers) from its site.  In the event the City
purchases the facility, the City must reimburse the Company for
all costs not previously recovered from operations, plus a
factor to cover general and administrative expenses and profit.
In 1994, the City approved a two-year extension of the
Company's current operation and maintenance contract into 1997.


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                              I-6



     3. Chemical Supply

     In the chemical supply area, the Company uses its
CloromatR technology to produce sodium hypochlorite and related
chlor-alkali chemicals for industrial, commercial and other
non-consumer applications, utilizing a membrane-based process.
The Company's wholly owned Australian subsidiary, Elite
Chemicals Pty. Ltd., utilizes Cloromat systems to produce
sodium hypochlorite on-site in Brisbane for industrial,
commercial and janitorial supply of bleach products.  In 1994,
the Australian subsidiary signed a five-year contract to supply
sodium hypochlorite to treat the City of Brisbane's drinking
water supply, and in 1995 expanded its bleach-manufacturing
capacity by one-third.

     The Company's wholly owned English subsidiary, Ionics
(U.K.) Limited, engages in bulk bleach sales at a Cloromat
facility in Bridgwater, England.  A large portion of the
facility's output is being sold to an English manufacturer for
use in cellophane manufacture, and the balance is being sold to
the regional market.  In 1995, a second major Cloromat facility
in England owned and operated by Ionics (U.K.) Limited
commenced bulk bleach sales to a leading English manufacturer
of household cleaning products and to the regional market being
served by the plant.

     4. Food Processing

     In 1994, the Company commenced operations under an
agreement with a major U.S. dairy cooperative overseeing whey
processing activities at two plants owned by the cooperative.
Included in the equipment being utilized by the Company at
these plants are its ElectromatR electrodialysis systems.  The
Company receives a processing fee based on the production of
demineralized whey for its services.  In 1995, the cooperative
authorized the Company to increase the amount of demineralized
whey being produced at the two plants.

Consumer Products

     Ionics' consumer products business segment accounted for
approximately 22% of the Company's revenues in 1995.  The
Company's consumer products serve the bottled water, home water
purification and consumer bleach products market areas. 

     1. Aqua CoolR Pure Bottled Water

     Ionics entered the bottled water business in 1984.  The
Company's strategy is to utilize its proprietary desalination
and purification technology to create a brand of drinking
water, named Aqua Cool Pure Bottled Water, which can be  
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                              I-7





reproduced with uniform consistency and high quality at
numerous locations around the world.  Distribution operations
have been established to serve the areas in and around London,
Manchester, Birmingham, Bristol and Leeds, England; a number of
metropolitan areas in the eastern, southeastern and central
United States; and, through joint ventures, in Bahrain, Kuwait
and Saudi Arabia.  The Company's business focuses on the sale
of Aqua Cool in five-gallon bottles to a variety of commercial
and residential customers.  The Company also manufactures
coolers in a wide variety of colors which offer options for
hot, cold and room temperature water.

     At the end of 1995, there were a total of 25 Aqua Cool
distribution centers in the United States and overseas,
supplied with Aqua Cool by six regional water purification and
bottling facilities, supplying a customer base of approximately
80,000.

     2. Home Water Purification Systems  

        Point-of-Use Devices

     The Company participates in the "point-of-use" market for
over and under-the-sink water purifiers through the manufacture
and sale of HYgeneR, a proprietary, EPA-registered, silver-
impregnated activated carbon filtering media, and through the
sale of reverse osmosis and activated carbon-based filtering
devices.  The Company incorporates HYgene, which is designed to
prevent bacterial build-up while providing the capability of
removing undesirable tastes and odors from the water supply,
into its own bacteriostatic water conditioners and also sells
HYgene to manufacturers of household point-of-use water
filters.

        Point of Entry Devices 

     Ionics' point-of-entry water products include ion-exchange
water conditioners to "soften" hard water, and chemicals and
media for filtration and treatment.  The Company sells its
products, under the General Ionics and other brands, through
both independent distributorships and wholly owned sales and
service dealerships.  The Company recently introduced new
marketing assistance programs, including retail financing, to
its independent distributors, and also increased its base of
independent distributors.





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                              I-8




     3. Bleach-Based Consumer Products

     The Company's Elite Chemicals New England division
operates a Cloromat facility to produce and distribute bleach-
based products for the consumer market, primarily one-gallon
bleach products under private label or under the Company's own
"EliteR", "Super ValueTM" and "UltraPureTM" brands, and methanol-
based automobile windshield wash solution.  In 1994, to expand these
operations, the Company purchased a 129,000 square foot
manufacturing facility, located in Ludlow, Massachusetts, which
has now commenced operations.  In 1995, the Company purchased a
facility in Elkton, Maryland, to serve as the Mid-Atlantic
regional manufacturing and distribution center for bleach-based
and related consumer products.

Raw Materials and Sources of Supply

     All raw materials essential to the business of the Company
can normally be obtained from more than one source.  In those
few instances where raw materials are being supplied by only
one source, the current supplier has given the Company a lead
time for cancellation, which the Company believes is sufficient
to enable it to obtain other suppliers.  In addition, the
Company maintains inventories of single source items which it
believes are adequate under the circumstances.

     The Company produces the membranes required for its
equipment and systems that use the ED, EDR, MF, UF and EDI
processes.  Membranes used for the RO process are purchased
from outside suppliers, and are normally available from
multiple sources.

Patents and Trademarks

     The Company believes that its products, know-how,
servicing network and marketing skills are more significant to
its business than trademark or patent protection of its
technology.  Nevertheless, the Company has a policy of applying
for patents both in the United States and abroad on inventions
made in the course of its research and development work for
which a commercial use is considered likely.  The Company owns
numerous United States and foreign patents and trademarks and
has issued licenses thereunder, and currently has additional
pending patent applications.  Of the 92 active U.S. patents
held by the Company, a substantial portion involves membranes,
membrane technology and related separations processes such as
electrodialysis and electrodialysis reversal, reverse osmosis,
ultrafiltration and electrodeionization.  The Company believes
that none of its individual patents or groups of related
patents, nor any of its trademarks, is of sufficient importance  

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                              I-9




for its termination or abandonment, or cancellation of licenses
extending rights thereunder, to have a material adverse effect
on the Company.


Seasonality

     The activities of the Company's businesses are not of a
seasonal nature, other than certain activities of the Consumer
Products segment.  Bottled water sales and bleach products for
swimming pool use tend to increase during the summer months.
Also, sales levels for automobile windshield wash solution
increase in the winter months.


Customers

     The nature of the Company's business is such that it
frequently has in progress large contracts with one or more
customers for specific projects; however, there is no one
customer whose purchases account for 10% or more of the
Company's consolidated revenues and whose loss would have a
material adverse effect on the Company and its subsidiaries
taken as a whole.

Backlog

     The Company's backlog of firm orders was $173,734,000 at
December 31, 1995 and $152,340,000 at December 31, 1994.  For
multi-year contracts, the Company includes in reported backlog
the revenues associated with the first five years of the
contract.  For multi-year contracts which are not otherwise
included in backlog, the Company includes in backlog up to one
year of revenues.  Ionics expects to fill approximately 74% of
its December 31, 1995 backlog during 1996.  The Company does
not believe that there are any seasonal aspects to these
backlog figures.

Government Contracts

     The Company does not believe that any of its sales under
U.S. Government contracts or subcontracts during 1995 are
subject to renegotiation.  The Company has not had adjustments
to its negotiated contract prices, nor are any proceedings
pending for such adjustments.






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                             I-10




Research and Development

     Since the development of the ion-exchange membrane and the
EDR process, Ionics has continued its commitment to research
and development directed toward products for use in water
purification, processing and measurement, and separations
technology.  The Company's research and development expenses
were approximately $3,432,000 in 1995, $3,372,000 in 1994 and
$3,678,000 in 1993.

Competition

     The Company experiences competition from a variety of
sources with respect to virtually all of its products, systems
and services, although the Company knows of no single entity
that competes with it across the full range of its products and
services.  Competition in the markets served by the Company is
based on a number of factors, which may include price,
technology, applications experience, know-how, availability of
financing, reputation, product warranties, reliability, service
and distribution.

     With respect to the Company's Membranes and Related
Equipment business segment, there are a number of companies,
including several sizable chemical companies, that manufacture
membranes, but not equipment.  There are numerous smaller
companies, primarily fabricators, that build water treatment
and desalination equipment, but which generally do not have
their own proprietary membrane technology.  A limited number of
companies manufacture both membranes and equipment.  The
Company has numerous competitors in its conventional water
treatment, instruments and fabricated products business lines.

     In 1994, the International Desalination Association
released a report providing data regarding the manufacturers of
desalination equipment.  According to the report, which covered
land-based water desalination plants delivered or under
construction as of December 1993, with a capacity to produce
100 cubic meters (approximately 25,000 gallons) or more of
fresh water daily, Ionics ranked first in terms of the
cumulative number of such plants sold, having sold 1,244 plants
of such capacity, more than the next three manufacturers
combined.  When compared only to manufacturers of membrane-type
desalination equipment, Ionics ranked first in both number of
units sold and the total capacity of units sold.






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                             I-11






     With respect to the Water, Food and Chemical Supply
business segment, the Company competes with regional suppliers
of ultrapure water services, and with other manufacturers of
membrane-related equipment.  In the chemical supply activity,
the Company competes with manufacturers and distributors of
sodium hypochlorite and water treatment chemicals.

     With respect to the Company's Consumer Products business
segment, there are numerous bottled water companies which
compete with the Company, including several which are much
larger than the Company.  Most of the Company's competitors in
point-of-entry and point-of use products for the home are small
assemblers, serving local or regional markets.  However, there
are also several large companies competing nationally in these
markets.  In the case of its silver-impregnated activated
carbon product lines, the Company knows of two competitors with
which it competes on a national basis.

     The Company competes with many suppliers of bleach and
bleach-based cleaning products and automobile windshield wash
for the consumer market, a number of which are much larger than
the Company.

     The Company is unable to state with certainty its relative
market position in all aspects of its business.  Many of its
competitors have financial and other resources greater than
those of the Company.

Environmental Matters

     Continued compliance by the Company or by its subsidiaries
with federal, state and local provisions regulating the
discharge of materials into the environment or otherwise
relating to the protection of the environment is expected to
have no material effect upon capital expenditures, earnings or
the competitive position of the Company or any of its
subsidiaries.

     The Company is one of approximately 1,000 PRP's at a
Superfund site at Solvent Recovery Source of New England in
Southington, Connecticut (the "SRS Site").  The Company's
volumetric ranking in comparison to the total volume of wastes
treated on the SRS Site is approximately 0.522%.  A non-time
critical removal action, consisting of containment, pumping, 





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                             I-12





and treatment of the most heavily contaminated non-bedrock
groundwater, was commenced in 1995.  The Company's share of the
total cost of this action, which is estimated at $7.75 million
including operation and maintenance through 1997, will be
$40,400, of which $30,384 has been paid to date.

     The PRP Group will conduct a second non-time critical
removal action which will cause the installation of an asphalt
cap on the site and bedrock groundwater wells to contain, pump
and treat the bedrock groundwater.  The Company's share of the
total cost for this work, which is estimated to be $5.55
million, will be approximately $29,000.  

     It is too soon to predict the scope and cost of the final
clean-up remedy that the EPA will select.  However, based on
its small volumetric ranking and the identities of the larger
PRP's, which include many substantial companies, the Company
believes that its liability in this matter will not have a
material effect on the Company or its financial position.

     The Company has never had a product liability claim
grounded in environmental liability, and believes that the
nature of its products and business makes such a claim
unlikely.

Employees

     The Company and its consolidated subsidiaries employ
approximately 1,350 full-time persons, none of whom are
represented by unions except for the employees of the Company's
Australian subsidiary and certain employees of the Company's
Spanish subsidiary.  The Company considers its relations with
its employees to be good.

Foreign Operations

     The Company's sales to customers in foreign countries
primarily involve desalination systems, water and wastewater
treatment systems, sodium hypochlorite, Cloromat systems,
related products and services, and bottled water.  The Company seeks to 
minimize financial risks relating to its international operations.
Wherever possible, the Company obtains letters of credit or
similar payment assurances denominated in dollars.  If dollar
payments cannot be secured, the Company, where appropriate,
enters into foreign currency hedging transactions.  The Company 





15/


                             I-13






also uses foreign sources for equipment parts and may borrow
funds in local (foreign) currency to offset the asset risk of
foreign currency devaluation.  Net foreign currency transaction
gains included in income before taxes totalled $58,000 in 1995,
$23,000 in 1994 and $157,000 in 1993.

     Ionics engages in certain foreign operations both directly
and through the following wholly owned subsidiaries:  Ionics
(Bermuda) Ltd.; Ionics Iberica, S.A.; Ionics (U.K.) Limited;
Ionics Italba, S.p.A.; Ionics Nederland B.V.; Global Water
Services, S.A.; Elite Chemicals Pty. Ltd.; Eau et Industrie;
Resources Conservation Co. International; and Ionics Foreign
Sales Corporation Limited.  In early 1996, Ionics acquired a
number of entities incorporated in various Caribbean
jurisdictions which are engaged in seawater desalination
operations.

     The Company engages in various foreign operations through
investments in affiliated companies and joint venture
relationships.  The activities include the production, sale and
distribution of bottled water through a 40% owned affiliate in
Bahrain, a 40% owned affiliate in Saudi Arabia and a 49% owned
affiliate in Kuwait.

  In addition, the Company has a 23% ownership interest in
Watlington Waterworks Ltd. in Bermuda.  Watlington collects,
treats and distributes water throughout Bermuda for both
potable and non-potable uses.  The Company also has a 50%
ownership interest in Yuasa-Ionics Co., Ltd., Tokyo, Japan,
which among its other activities serves as a distributor of
certain of the Company's products in Japan; and a 49% ownership
interest in Ionics-Mega s.r.o, a limited liability company of
the Czech Republic established to pursue water treatment
opportunities in that country.

     Further geographical and financial information concerning
the Company's foreign operations appears in Notes 1, 5, 8, 12,
and 14 to the Company's Consolidated Financial Statements
included as part of the Company's 1995 Annual Report to the
Stockholders, which Notes are incorporated herein by reference.









16/


                             I-14



Financial Information About Foreign and 
Domestic Operations and Export Sales

     The information contained in Note 14 of Notes to
Consolidated Financial Statements contained in the Company's
Annual Report to Stockholders for the year ended December 31,
1995 is incorporated herein by reference.

Item 2.  PROPERTIES

     The Company owns or leases and occupies various
manufacturing and office facilities in the United States and
abroad.  The principal facilities owned by the Company include
two buildings in Watertown, Massachusetts, containing
approximately 250,000 square feet and housing executive
offices, laboratories and manufacturing and assembly
operations; a 234,000 square foot facility in Elkton, Maryland
which will be  utilized primarily for consumer bleach-based
product manufacturing, and distribution; a 129,000 square foot
facility in Ludlow, Massachusetts which is utilized primarily
for consumer bleach-based product manufacturing; two buildings
in Bridgeville, Pennsylvania containing approximately 77,000
square feet and housing manufacturing operations for home water
treatment equipment and fabricated products; and other
facilities in Phoenix, Arizona; Pico Rivera, California;
Lorton, Virginia; Union, New Jersey; Fairfield, Ohio; London,
England; Thetford, England;  Brisbane, Australia; and Milan,
Italy, for various operations relating to the business of the
Company.

     The Company makes use primarily of leased facilities for
its Aqua Cool bottled water distribution center at 25 locations
in the U.S. and overseas.

     The Company considers the business facilities that it
utilizes to be adequate for the uses to which they are being
put.


Item 3.  LEGAL PROCEEDINGS

     The Company is involved in the normal course of its
business in various litigation matters.  Although the Company's
counsel is unable to determine at the present time whether the
Company will have any liability in any of the pending matters,
some of which are in the early stages of pretrial discovery,
the Company believes it has meritorious defenses and that none
of the pending matters will have an outcome material to the
financial condition or business of the Company.


Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     No matters were submitted to a vote of security holders
during the fourth quarter of the fiscal year covered by this
report.

17/






                             I-15



                            PART II


Item 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND
         RELATED STOCKHOLDER MATTERS

     Reference is made to the Company's Annual Report to
Stockholders for the year ended December 31, 1995.  The
information set forth on page 32 entitled "Common Stock Price
Range" and the inside back cover of such Annual Report is
hereby incorporated by reference.


Item 6.  SELECTED FINANCIAL DATA

     Reference is made to the Company's Annual Report to
Stockholders for the year ended December 31, 1995.  The
information set forth on page 32 of such Annual Report entitled
"Selected Quarterly Financial Data (unaudited)" is hereby
incorporated by reference.


Item 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS

     Reference is made to the Company's Annual Report to
Stockholders for the year ended December 31, 1995.  The
information set forth on pages 16 through 18 of such Annual
Report entitled "Management's Discussion and Analysis of
Results of Operations and Financial Condition" is hereby
incorporated by reference.


Item 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     Reference is made to the Company's Annual Report to
Stockholders for the year ended December 31, 1995.  The
consolidated balance sheets of the Registrant as of December
31, 1995 and 1994, the related consolidated statements of
operations, cash flows and stockholders' equity for the years
ended December 31, 1995, 1994 and 1993, and the related notes
with the opinion thereon of Coopers & Lybrand L.L.P.,
independent accountants, on pages 19 through 31, and Selected
Quarterly Financial Data (unaudited) on page 32, are hereby
incorporated by reference.


Item 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON 
         ACCOUNTING AND FINANCIAL DISCLOSURE

     This item is not applicable to the Company.

18/


                             II-1




                           PART III

Item 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The information required by Item 10 with respect to
Directors is hereby incorporated by reference from the
Company's definitive proxy statement for the Annual Meeting of
Stockholders to be held May 2, 1996 to be filed with the
Securities and Exchange Commission on or about March 29, 1996.

     The information regarding executive officers is as
follows:
<TABLE>
<CAPTION>
                      Age as of     Positions
Name                 March 1, 1996  Presently Held
<S>                  <C>            <C>
Executive Officers:

Arthur L. Goldstein*      60        President, Chief Executive Officer
                                     and Director since 1971; Chairman
                                     of the Board since 1990
Kachig Kachadurian        46        Executive Vice President since 1994,
                                     Senior Vice President from 1991 to
                                     1994 and Vice President from 1983 to
                                     1991; Director since 1986
William E. Katz           71        Executive Vice President since 1983;
                                     Director since 1961
Robert J. Halliday        41        Vice President, Finance and Accounting
                                     since December 1990; Chief Financial
                                     Officer since August 1992
Stephen Korn              50        Vice President, General Counsel
                                     and Clerk since September 1989
Theodore G. Papastavros   62        Vice President since 1975 (currently
                                     Vice President, Strategic Planning)
                                     and Treasurer since February 1990
___________________
* Member of Executive Committee
</TABLE>
     There are no family relationships between any of the
officers or directors.  Officers of the Company are elected each
year at the annual meeting of Directors.

     All of the above executive officers have been employed by
the Company in various capacities for more than five years.

Item 11.  EXECUTIVE COMPENSATION

     The information required by Item 11 is hereby incorporated
by reference from the Company's definitive proxy statement for
the Annual Meeting of Stockholders to be held May 2, 1996 to be
filed with the Securities and Exchange Commission on or about
March 29, 1996.
19/

                             III-1




Item 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
          AND MANAGEMENT

     The information required by Item 12 is hereby incorporated
by reference from the Company's definitive proxy statement for
the Annual Meeting of Stockholders to be held May 2, 1996 to be
filed with the Securities and Exchange Commission on or about
March 29, 1996.


Item 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The information required by Item 13 is hereby incorporated
by reference from the Company's definitive proxy statement for
the Annual Meeting of Stockholders to be held May 2, 1996 to be
filed with the Securities and Exchange Commission on or about
March 29, 1996.


































20/

                             III-2



                            PART IV

Item 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND
          REPORTS ON FORM 8-K

(a)  1.   Financial Statements

          See Index to Financial Statements and Financial
          Statement Schedules on page IV-7.  The Financial
          Statement Schedules are filed as part of this Annual
          Report on Form 10-K.

     2.   Financial Statement Schedules

          See Index to Financial Statements and Financial
          Statement Schedules on page IV-7.

     3.   Exhibits
<TABLE>
<CAPTION>
     Exhibit
       No.    Description
     <S>      <C>
     3.0      Articles of Organization and By-Laws

              3.1     Restated Articles of Organization (filed              *
                      as Exhibit 3(a) to Form 10-K for year 
                      ended December 31, 1986).

              3.1(a)  Amendment to the Restated Articles of                 *
                      Organization (filed as Exhibit 3(b) to 
                      Form 10-K for year ended December 31, 1987).

              3.1(b)  Amendment to Restated Articles of                     *
                      Organization (filed as Exhibit 3.1(b) to 
                      Registration Statement No. 33-38290 on
                      Form S-2 effective January 24, 1991).

              3.2     By-Laws, as amended (filed as Exhibit 19 to           *
                      Form 10-Q for the quarter ended September 30,
                      1989).

     4.0      Instruments defining the rights of security holders,
              including indentures

              4.1     Agreement for a loan payable by a consolidated       **
                      subsidiary to a bank in Australia in the principal
                      amount of 725,000 Australian dollars guaranteed
                      by Registrant, and related documents.

              4.2     Rights Agreement, dated as of December 22, 1987,     *
                      as amended and restated as of August 15, 1989,
                      between Registrant and The First National Bank 
                      of Boston (filed as Exhibit 1 to Registrant's
                      Current Report on Form 8-K dated August 30, 1989).

21/





                             IV-1




              4.3     Indenture, dated as of December 22, 1987, between    *
                      Registrant and The First National Bank of Boston,
                      relating to Rights Agreement (filed as Exhibit 2 
                      to Registrant's Current Report on Form 8-K dated
                      December 22, 1987).

              4.4     Form of Common Stock Certificate (filed as Exhibit   *
                      4.10 to Registrant's Annual Report on Form 10-K 
                      for the year ended December 31, 1990).

     10.      Material Contracts

              10.1    1979 Stock Option Plan, as amended through          
                      February 22, 1996.                                  

              10.2    1986 Stock Option Plan for Non-Employee Directors,   
                      as amended through August 22, 1995.

              10.3    Amended and Restated Credit Agreement between        * 
                      Registrant and the First National Bank of Boston
                      dated as of December 31, 1992 (filed as Exhibit
                      10.3 to Registrant's Annual Report on Form 10-K
                      for the year ended December 31, 1992).

              10.3(1) Amendment Agreement No. 1, dated as of              
                      December 31, 1995, to Amended and Restated
                      Credit Agreement between Registrant and The
                      First National Bank of Boston.

              10.4    Operating Agreement dated as of September 27,        *
                      1989 between Registrant and Aqua Cool
                      Enterprises, Inc. (filed as Exhibit 10.4 to 
                      Registrant's Annual Report on Form 10-K for the
                      year ended December 31, 1989).

              10.5    Term Lease Master Agreement dated as of              *
                      September 27, 1989 between Registrant and
                      Aqua Cool Enterprises, Inc. (filed as Exhibit
                      10.5 to Registrant's Annual Report on Form 10-K
                      for the year ended December 31, 1989).

              10.6    Option Agreement dated as of September 27, 1989      *
                      among Registrant, Aqua Cool Enterprises, Inc.
                      and the other parties named therein (filed as
                      Exhibit 10.6 to Registrant's registration 
                      statement on Form S-2, No. 33-38290, 
                      effective January 24, 1991).

              10.7    Agreement for Privatization of Water Supplies        *
                      dated as of September 18, 1990 between the 
                      Company and the City of Santa Barbara, 
                      California (filed as Exhibit 10.7 to 
                      Registrant's registration statement on Form S-2,
                      No. 33-38290, effective January 24, 1991).

              10.8    Amendment No. 1, dated as of January 3, 1992, to     *
                      Agreement for Privatization of Water Supplies 
                      dated as of September 18, 1990 between the Company

22/



                             IV-2




                      and the City of Santa Barbara, California (filed as
                      Exhibit 10.8 to Registrant's annual report on 
                      Form 10-K for the year ended December 31, 1991).

              10.9    Amendment No. 2, dated as of January 19, 1993,       *
                      to Agreement for Privatization of Water Supplies
                      dated as of September 18, 1990 between the Company
                      and the City of Santa Barbara, California (filed as 
                      Exhibit 10.9 to the Registrant's annual report on
                      Form 10-K for the year ended December 31, 1992).

              10.10   Amendment No. 3, dated June 28, 1994, to Agreement   * 
                      for Privatization of Water Supplies dated as of
                      September 18, 1990, between the Company and the City
                      of Santa Barbara, California (filed electronically as
                      Exhibit 10.1 to the Registrant's Form 10-Q for the
                      period ended June 30, 1994).

              10.11   Asset Purchase Agreement among the Company,          *     
                      Resources Conservation Company, Resources
                      Conservation Co. International and Halliburton 
                      NUS Corporation dated December 30, 1993 (filed as 
                      Exhibit 2 to Registrant's current report on
                      Form 8-K dated February 7, 1994, and filed
                      electronically on the same date).
 
              10.12   1994 Restricted Stock Plan (filed as Exhibit 10.12   *
                      to Registrant's Annual Report on Form 10-K dated
                      March 30, 1995 and filed electronically on the
                      same date).

     11.      Statement re Computation of Earnings Per Share.              

     13.      Annual Report to Stockholders of the Registrant for          
              the year ended December 31, 1995 (only pages 16 
              through 32 and the inside back cover constitute an 
              exhibit to this report).

     21.      Subsidiaries of the Registrant.                              

     23.      Consents

              23.1    Consent of Coopers & Lybrand L.L.P. to incorporation
                      by reference of that firm's report dated 
                      February 20, 1996, which is included on page 31 of 
                      the Registrant's Annual Report to Stockholders 
                      for the year ended December 31, 1995.

     24.      Power of Attorney.

     27.      Financial Data Schedule                                     ***
________________________________
     *   incorporated herein by reference

     **  copies of which will be filed by Registrant with the
         Securities and Exchange Commission upon its request

     *** for electronic purposes only
</TABLE>
23/


                             IV-3






(b)  Reports on Form 8-K

     No reports on Form 8-K were filed by the Registrant during
     the last quarter of fiscal 1995.

     Undertaking

     For purposes of complying with the amendments to the rules
     governing Form S-8 effective July 13, 1990 under the
     Securities Act of 1933, the undersigned hereby undertakes as
     follows, which undertaking shall be incorporated by
     reference into Registrant's registration statements on Form
     S-8 Nos. 33-14194, 33-5814, 33-2092, 2-72936, 2-82780, 2-
     64255, 33-41598, 33-54293, 33-59051 and 33-54400.

     Insofar as indemnification for liabilities arising under the
     Securities Act of 1933 may be permitted to directors,
     officers and controlling persons of the registrant pursuant
     to the foregoing provisions, or otherwise, the registrant
     has been advised that in the opinion of the Securities and
     Exchange Commission such indemnification is against public
     policy as expressed in the Act and is, therefore,
     unenforceable.  In the event that a claim for
     indemnification against such liabilities (other than the
     payment by the registrant of expenses incurred or paid by a
     director, officer or controlling person of the registrant in
     the successful defense of any action, suit or proceeding) is
     asserted by such director, officer or controlling person in
     connection with the securities being registered, the
     registrant will, unless in the opinion of its counsel the
     matter has been settled by controlling precedent, submit to
     a court of appropriate jurisdiction the question whether
     such indemnification by it is against public policy as
     expressed in the Act and will be governed by the final
     adjudication of such issue.















24/



                             IV-4







                        SIGNATURES



     Pursuant to the requirements of Section 13 or 15(d) 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.

                             IONICS, INCORPORATED
                             (Registrant)



                             By/s/Arthur L. Goldstein     
                                  Arthur L. Goldstein,
                                  Chairman of the Board,
                                  President and Chief
                                  Executive Officer
          
                             Date:    March 29, 1996      



     Pursuant to the requirements of 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 and on the dates indicated.



Date: March 29, 1996         By/s/Arthur L. Goldstein    
                                  Arthur L. Goldstein,
                                  Chairman of the Board,
                                  President and
                                  Chief Executive Officer
                                  (principal executive
                                   officer) and Director



Date: March 29, 1996         By/s/Robert J. Halliday     
                                  Robert J. Halliday, 
                                  Vice President, Finance
                                  and Accounting and Chief
                                  Financial Officer
                                  (principal financial and
                                   accounting officer)

25/


                             IV-5











Date: March 29, 1996         By/s/William L. Brown             
                                  William L. Brown, Director


Date: March 29, 1996         By/s/Arnaud de Vitry d'Avaucourt  
                                  Arnaud de Vitry d'Avaucourt,
                                  Director


Date: March 29, 1996         By/s/Lawrence E. Fouraker         
                                  Lawrence E. Fouraker, Director


Date: March 29, 1996         By/s/Samuel A. Goldblith          
                                  Samuel A. Goldblith, Director


Date: March 29, 1996         By/s/Kachig Kachadurian           
                                  Kachig Kachadurian, Director


Date: March 29, 1996         By/s/William E. Katz              
                                  William E. Katz, Director


Date: March 29, 1996         By/s/Robert B. Luick______________
                                  Robert B. Luick, Director


Date: March 29, 1996         By/s/John J. Shields              
                                  John J. Shields, Director


Date: March 29, 1996         By/s/Carl S. Sloane               
                                  Carl S. Sloane, Director


DATE: March 29, 1996         By/s/Mark S. Wrighton             
                                  Mark S. Wrighton, Director


Date: March 29, 1996         By/s/Allen S. Wyett               
                                  Allen S. Wyett, Director


26/


                             IV-6




                     IONICS, INCORPORATED
INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES

                                                         PAGES

Report of Independent Accountants                          31*

Financial Statements:

     Consolidated Statements of Operations for the
     Years Ended December 31, 1995, 1994 and 1993          19*

     Consolidated Balance Sheets as of
     December 31, 1995 and 1994                            20*

     Consolidated Statements of Cash Flows for the 
     Years Ended December 31, 1995, 1994 and 1993          21*

     Consolidated Statements of Stockholders' Equity for
     the Years Ended December 31, 1995, 1994 and 1993      22*

     Notes to Consolidated Financial Statements           23-31* 


Supporting Financial Statement Schedules for the years Ended
December 31, 1995, 1994 and 1993:

     Schedule II - Valuation and Qualifying Accounts     IV-8
          

Report of Independent Accountants on Financial Statement 
Statement Schedule                                       IV-9

__________________

All other schedules are omitted because the amounts are
immaterial, the schedules are not applicable or the required
information is shown in the financial statements or the notes
thereto.

*  Page references are to the Annual Report to Stockholders of
   the Company for the year ended December 31, 1995, which pages
   are incorporated herein by reference.









27/


                             IV-7



<TABLE>
                             IONICS, INCORPORATED

                SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

                                                        

<CAPTION>


                                      Additions    Additions
                         Balance at   Charged to     Due to
                         Beginning    Costs and     Acquired                      Balance at
Description                of Year     Expenses    Businesses(A)  Deductions(B)   End of Year
<S>                      <C>          <C>          <C>            <C>             <C>
Allowance for doubtful
accounts and uncollectible
notes receivable:

     Years ended:

     December 31, 1995   $2,197,170   $563,458     $       0      $  371,272      $2,389,356

     December 31, 1994   $2,022,068   $535,200     $       0      $  360,098      $2,197,170

     December 31, 1993   $2,694,200   $390,489     $(124,000)     $  938,621      $2,022,068

<FN1>
(A)  1993 amount includes reductions of $413,000 resulting from the consolidation of ACE.
<FN2>
(B)  Deductions result primarily from the write-off of accounts.

</TABLE>




















28/


                             IV-8




               REPORT OF INDEPENDENT ACCOUNTANTS


To the Board of Directors and Stockholders of Ionics,
Incorporated:

     Our report on the consolidated financial statements of
Ionics, Incorporated as of December 31, 1995 and 1994 and for
each of the three years in the period ended December 31, 1995
has been incorporated by reference in this Form 10-K from page
31 of the 1995 Annual Report to Stockholders of Ionics,
Incorporated.  In connection with our audits of such financial
statements, we have also audited the related financial statement
schedule listed in the Index on page IV-7 of this Form 10-K.

     In our opinion, the financial statement schedule referred
to above, when considered in relation to the basic financial
statements taken as a whole, presents fairly, in all material
respects, the information required to be included therein.



                                       /S/COOPERS & LYBRAND L.L.P.



Boston, Massachusetts
February 20, 1996























29/


                             IV-9




<TABLE>
                           EXHIBIT INDEX
<CAPTION>
                                                                     Sequentially
     Exhibit                                                           Numbered
       No.    Description                                              Page No.   
     <S>      <C>     <C>                                            <C>
     3.0      Articles of Organization and By-Laws                         

              3.1     Restated Articles of Organization (filed             *
                      as Exhibit 3(a) to Form 10-K for year 
                      ended December 31, 1986).

              3.1(a)  Amendment to the Restated Articles of                *
                      Organization (filed as Exhibit 3(b) to 
                      Form 10-K for year ended December 31, 1987).

              3.1(b)  Amendment to Restated Articles of                    *
                      Organization (filed as Exhibit 3.1(b) to 
                      Registration Statement No. 33-38290 on
                      Form S-2 effective January 24, 1991).

              3.2     By-Laws, as amended (filed as Exhibit 19 to          *
                      Form 10-Q for the quarter ended September 30,
                      1989).

     4.0      Instruments defining the rights of security holders,
              including indentures

              4.2     Rights Agreement, dated as of December 22, 1987,     * 
                      as amended and restated as of August 15, 1989,
                      between Registrant and The First National Bank 
                      of Boston (filed as Exhibit 1 to Registrant's
                      current Report on Form 8-K dated August 30, 1989).

              4.3     Indenture, dated as of December 22, 1987, between    *
                      Registrant and The First National Bank of Boston,
                      relating to Rights Agreement (filed as Exhibit 2 
                      to Registrant's Current Report on Form 8-K dated
                      December 22, 1987).

              4.4     Form of Common Stock Certificate (filed as Exhibit   *
                      4.10 to Registrant's Annual Report on Form 10-K 
                      for the year ended December 31, 1990).

     10.      Material Contracts

              10.1    1979 Stock Option Plan, as amended through         33
                      February 22, 1996.

              10.2    1986 Stock Option Plan for Non-Employee Directors, 49
                      as amended through February 18, 1992 as amended
                      through August 22, 1995.

30/






              10.3    Amended and Restated Credit Agreement between        *
                      Registrant and The First National Bank of Boston
                      dated as of December 31, 1992 (filed as Exhibit
                      10.3 to Registrant's Annual Report on Form 10-K
                      for the year ended December 31, 1992).

              10.3(1) Amendment Agreement No. 1, dated as of             59
                      December 31, 1995, to Amended and Restated
                      Credit Agreement between Registrant and The
                      First National Bank of Boston.

              10.4    Operating Agreement dated as of September 27,        *
                      1989 between Registrant and Aqua Cool
                      Enterprises, Inc. (filed as Exhibit 10.4 to 
                      Registrant's Annual Report on Form 10-K for the
                      year ended December 31, 1989).

              10.5    Term Lease Master Agreement dated as of              *
                      September 27, 1989 between Registrant and
                      Aqua Cool Enterprises, Inc. (filed as Exhibit
                      10.5 to Registrant's Annual Report on Form 10-K
                      for the year ended December 31, 1989).

              10.6    Option Agreement dated as of September 27, 1989      *
                      among Registrant, Aqua Cool Enterprises, Inc.
                      and the other parties named therein (filed as
                      Exhibit 10.6 to Registrant's registration 
                      statement on Form S-2, No. 33-38290, 
                      effective January 24, 1991).

              10.7    Agreement for Privatization of Water Supplies        *
                      dated as of September 18, 1990 between the 
                      Company and the City of Santa Barbara, 
                      California (filed as Exhibit 10.7 to 
                      Registrant's registration statement on Form S-2,
                      No. 33-38290, effective January 24, 1991).

              10.8    Amendment No. 1, dated as of January 3, 1992, to      *
                      Agreement for Privatization of Water Supplies 
                      dated as of September 18, 1990 between the Company
                      and the City of Santa Barbara, California (filed as
                      Exhibit 10.8 to Registrant's annual report on 
                      Form 10-K for the year ended December 31, 1991).

              10.9    Amendment No. 2, dated as of January 19, 1993,       *
                      to Agreement for Privatization of Water Supplies
                      dated as of September 18, 1990 between the Company
                      and the City of Santa Barbara, California (filed as
                      Exhibit 10.9 to the Registrant's annual report on
                      Form 10-K for the year ended December 31, 1992).


31/






              10.10   Amendment No. 3, dated June 28, 1994, to Agreement   *
                      for Privatization of Water Supplies dated as of 
                      September 18, 1990 between the Company and the City
                      of Santa Barbara, California (filed electronically 
                      as Exhibit 10.1 to the Registrant's Form 10-Q 
                      for the period ended June 30, 1994).

              10.11   Asset Purchase Agreement among the Company,          *
                      Resources Conservation Company, Resources
                      Conservation Co. International and Halliburton
                      NUS Corporation dated December 30, 1993 (filed
                      as Exhibit 2 to Registrant's current report on
                      Form 8-K dated February 7, 1994 and filed
                      electronically on the same date).

              10.12   1994 Restricted Stock Plan (filed as Exhibit         *
                      10.12 to Registrant's Annual Report on Form 10-K 
                      dated March 30, 1995 and filed electronically 
                      on the same date).

     11.      Statement re Computation of Earnings Per Share.            65

     13.      Annual Report to Stockholders of the Registrant for        66
              the year ended December 31, 1995 (only pages 16 
              through 32 and the inside back cover constitute an 
              exhibit to this report).

     21.      Subsidiaries of the Registrant.                            99

     23.1     Consent of Coopers & Lybrand L.L.P. to incorporation      100
              by reference of that firm's report dated 
              February 20, 1996, which is included on page 31 of 
              the Registrant's Annual Report to Stockholders 
              for the year ended December 31, 1995.

     24.      Power of Attorney.                                        101

     27.      Financial Data Schedule                          (for electronic
                                                                purposes only)


                               
* incorporated herein by reference


</TABLE>






32/