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 June 30, 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 1-4169

                  TEXAS GAS TRANSMISSION CORPORATION
         (Exact name of registrant as specified in its charter)

           Delaware                           61-0405152
     (State or other jurisdiction of        (I.R.S. Employer
     incorporation or organization)         Identification No.)


     3800 Frederica Street, Owensboro, Kentucky    42301
     (Address of principal executive offices)    (Zip Code)

   Registrant's telephone number, including area code: (502)926-8686


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.
1,000 shares as of August 8, 1997

REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTIONS
H(1)(a)  and (b) OF FORM 10-Q AND IS THEREFORE FILING  THIS  FORM
WITH THE REDUCED DISCLOSURE FORMAT.
<PAGE>

        TEXAS GAS TRANSMISSION CORPORATION AND SUBSIDIARY

                              INDEX



                                                          Page
                                                         Number

Part I.  Financial Information

Item 1.  Financial Statements .........................     3

Consolidated Balance Sheets at
  June 30, 1997 and December 31, 1996 .................   3-4

Consolidated Statements of Income
  Three Months Ended June 30, 1997 and 1996 ...........     5
  Six Months Ended June 30, 1997 and 1996..............     6

Consolidated Statements of Cash Flows
  Six Months Ended June 30, 1997 and 1996 .............     7

Condensed Notes to Consolidated Financial Statements ..  8-11

Item 2.  Management's Narrative Analysis of
         the Results of Operations .................... 12-13

Part II.  Other Information

Item 6.Exhibits and Reports on Form 8-K ...............    14

Signature .............................................    15

<PAGE>
Item 1.   Financial Statements

        TEXAS GAS TRANSMISSION CORPORATION AND SUBSIDIARY
                                
                   CONSOLIDATED BALANCE SHEETS
                     (Thousands of Dollars)
                           (Unaudited)
<TABLE>
<CAPTION>
                                             June 30,    December 31,
                                               1997         1996
               ASSETS
<S>                                        <C>          <C>
Current Assets:
 Cash and temporary cash investments        $      509   $      115
 Receivables:
   Trade                                         3,263        8,415
   Affiliates                                      128        1,409
   Other                                           675        1,418
 Advances to affiliates                        110,036      147,144
 Transportation and exchange gas receivable        727          718
 Costs recoverable from customers:
   Gas supply realignment                        1,414        8,640
   Other                                        14,030       17,980
 Inventories                                    16,780       15,081
 Deferred income taxes                           6,491        4,945
 Gas stored underground                         11,115       11,115
 Other                                           1,074        1,311
   Total current assets                        166,242      218,291

Advances to Affiliates                          25,000       25,000

Investments, at Cost                             1,322        1,339

Property, Plant and Equipment:
 Natural gas transmission plant, at cost       986,923      958,896
 Less -- Accumulated depreciation and
   amortization                                 83,574       65,265
   Property, plant and equipment, net          903,349      893,631

Other Assets:
 Gas stored underground                        103,869      100,709
 Costs recoverable from customers               49,329       54,817
 Other                                          14,871       13,313
   Total other assets                          168,069      168,839

   Total Assets                             $1,263,982   $1,307,100
</TABLE>
 The accompanying condensed notes are an integral part of these
               consolidated financial statements.
<PAGE>
        TEXAS GAS TRANSMISSION CORPORATION AND SUBSIDIARY
                                
                   CONSOLIDATED BALANCE SHEETS
                     (Thousands of Dollars)
                           (Unaudited)
<TABLE>
<CAPTION>
                                
                                                  June 30,    December 31,
LIABILITIES AND STOCKHOLDER'S EQUITY                1997         1996
<S>                                             <C>          <C>
Current Liabilities:
 Payables:
   Trade                                         $    2,613   $    4,850
   Affiliates                                        26,657       41,954
   Other                                              6,292        9,252
 Transportation and exchange gas payable              3,465        3,306
 Accrued liabilities                                 74,759       68,784
 Accrued gas supply realignment costs                 3,833        3,833
 Costs refundable to customers                        1,398        1,626
   Total current liabilities                        119,017      133,605

Long-Term Debt                                      252,599      253,611

Other Liabilities and Deferred Credits:
 Deferred income taxes                              144,421      143,288
 Postretirement benefits other than pensions         39,738       43,765
 Other                                               46,931       47,951
   Total other liabilities and deferred credits     231,090      235,004

Contingent Liabilities and Commitments                 -            -

Stockholder's Equity:
 Common stock, $1.00 par value, 1,000 shares
   authorized, issued and outstanding                     1            1
 Premium on capital stock and other paid-in
   capital                                          661,146      678,146
 Retained earnings                                      129        6,733
   Total stockholder's equity                       661,276      684,880

   Total Liabilities and Stockholder's Equity    $1,263,982   $1,307,100

</TABLE>

      The accompanying condensed notes are an integral part of these
                    consolidated financial statements.
<PAGE>

        TEXAS GAS TRANSMISSION CORPORATION AND SUBSIDIARY
                                
                CONSOLIDATED STATEMENTS OF INCOME
                     (Thousands of Dollars)
                           (Unaudited)
<TABLE>
<CAPTION>

                                        Three Months Ended June 30,
                                          1997           1996
<S>                                    <C>            <C>
Operating Revenues:
 Gas sales                              $  3,643       $ 12,852
 Gas transportation                       59,873         61,757
 Other                                        99            515
   Total operating revenues               63,615         75,124

Operating Costs and Expenses:
 Cost of gas sold                          3,732         12,708
 Cost of gas transportation                9,297          6,788
 Operation and maintenance                15,362         15,533
 Administrative and general               13,153         15,149
 Depreciation and amortization            10,669         10,347
 Taxes other than income taxes             3,630          3,744
   Total operating costs and expenses     55,843         64,269

Operating Income                           7,772         10,855

Other (Income) Deductions:
 Interest expense                          5,009          5,281
 Interest income                          (2,268)        (3,380)
 Miscellaneous other (income) deductions    (107)           291
   Total other deductions                  2,634          2,192

Income Before Income Taxes                 5,138          8,663

Provision for Income Taxes                 2,048          3,328

Net Income                              $  3,090       $  5,335

</TABLE>                        
                                                                
    The accompanying condensed notes are an integral part of these
                  consolidated financial statements.
<PAGE>

        TEXAS GAS TRANSMISSION CORPORATION AND SUBSIDIARY
                                
                CONSOLIDATED STATEMENTS OF INCOME
                     (Thousands of Dollars)
                           (Unaudited)
<TABLE>
<CAPTION>

                                            Six Months Ended June 30,
                                              1997           1996
<S>                                        <C>            <C>
Operating Revenues:
 Gas sales                                  $ 14,363       $ 34,624
 Gas transportation                          156,263        162,452
 Other                                           928          1,018
   Total operating revenues                  171,554        198,094

Operating Costs and Expenses:
 Cost of gas sold                             14,521         34,493
 Cost of gas transportation                   19,756         23,390
 Operation and maintenance                    29,695         29,219
 Administrative and general                   28,367         31,343
 Depreciation and amortization                21,187         21,076
 Taxes other than income taxes                 7,821          7,655
   Total operating costs and expenses        121,347        147,176

Operating Income                              50,207         50,918

Other (Income) Deductions:
 Interest expense                             10,024         10,598
 Interest income                              (4,627)        (6,934)
 Miscellaneous other (income) deductions        (168)           592
   Total other deductions                      5,229          4,256

Income Before Income Taxes                    44,978         46,662

Provision for Income Taxes                    17,898         18,385

Net Income                                  $ 27,080       $ 28,277

</TABLE>                                
                                                                
 The accompanying condensed notes are an integral part of these
               consolidated financial statements.
<PAGE>

        TEXAS GAS TRANSMISSION CORPORATION AND SUBSIDIARY
              CONSOLIDATED STATEMENTS OF CASH FLOWS
                      (Thousands of Dollars)
                           (Unaudited)
<TABLE>
<CAPTION>

                                                 Six Months Ended June 30,
                                                   1997            1996
<S>                                             <C>             <C>
OPERATING ACTIVITIES:
 Net income                                      $ 27,080        $ 28,277
 Adjustments to reconcile to cash provided
  from operations:
   Depreciation and depletion                      21,187          21,076
   Provision for deferred income taxes               (412)          6,135
   Changes in receivables sold                     (8,500)        (11,600)
   Changes in receivables                          14,386           4,220
   Changes in inventories                          (1,699)         (1,289)
   Changes in other current assets                 13,118          11,564
   Changes in accounts payable                     (5,197)        (16,456)
   Changes in accrued liabilities                   5,584         (30,713)
   Other, including changes in noncurrent 
     assets and liabilities                       (20,554)         15,563
      Net cash provided by operating
        activities                                 44,993          26,777

FINANCING ACTIVITIES:
 Dividends and returns of capital                 (50,684)        (40,000)
      Net cash (used in) financing activities     (50,684)        (40,000)

INVESTING ACTIVITIES:
 Property, plant and equipment:
   Capital expenditures, net of AFUDC             (31,091)        (14,723)
   Proceeds from sales and salvage values,
      net of costs of removal                          68            (504)
 Advances to affiliates, net                       37,108          28,439
      Net cash provided by investing activities     6,085          13,212

Increase (Decrease) in Cash and Cash Equivalents      394             (11)

Cash and Cash Equivalents at Beginning of Period      115             206

Cash and Cash Equivalents at End of Period       $    509        $    195

Supplemental Disclosure of Cash Flow Information:
 Cash paid during the period for:
   Interest (net of amount capitalized)          $ 10,863        $ 12,389
   Income taxes, net                               16,682           8,706
                                
</TABLE>                                
                                                                
 The accompanying condensed notes are an integral part of these
               consolidated financial statements.
<PAGE>

        TEXAS GAS TRANSMISSION CORPORATION AND SUBSIDIARY
      CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           (Unaudited)
                                

A.  Corporate Structure and Control, Nature of Operations and
    Basis of Presentation

    Corporate Structure and Control

    Effective May 1, 1997, Texas Gas Transmission Corporation and
its    wholly   owned   subsidiary,   TGT   Enterprises,    Inc.,
(collectively, the Company) became a wholly owned  subsidiary  of
Williams Interstate Natural Gas Systems, Inc., which is a  wholly
owned  subsidiary  of  The Williams Companies,  Inc.  (Williams).
Prior  to  May 1, 1997, the Company was a wholly owned subsidiary
of Williams.

 Seasonal Variation

    Operating income may vary by quarter.  Based on current  rate
structure, the Company experiences lower operating income in  the
second  and  third quarters as compared to the first  and  fourth
quarters.

  Basis of Presentation

    The consolidated financial statements have been prepared from
the  books and records of the Company without audit, pursuant  to
the   rules  and  regulations  of  the  Securities  and  Exchange
Commission  (SEC).  Certain information and footnote  disclosures
normally  included in consolidated financial statements  prepared
in  accordance with generally accepted accounting principles have
been   condensed   or   omitted.   The   accompanying   unaudited
consolidated  financial statements include all adjustments,  both
normal  recurring  and  others, which,  in  the  opinion  of  the
Company's  management,  are  necessary  to  present  fairly   its
financial  position  at  June 30, 1997  and  December  31,  1996;
results  of  operations and cash flows for the six  months  ended
June  30, 1997 and 1996; and results of operations for the  three
months   ended  June  30,  1997  and  1996.   These  consolidated
financial  statements  should be read  in  conjunction  with  the
financial  statements,  notes thereto and management's  narrative
analysis contained in the Company's 1996 Annual Report on Form 10-
K and the Company's 1997 First Quarter Report on Form 10-Q.

    The  Company  was  acquired  in 1995  by  Williams,  and  the
acquisition  was  accounted  for using  the  purchase  method  of
accounting.  Accordingly, an allocation of the purchase price was
assigned  to the assets and liabilities of the Company, based  on
their   estimated  fair  values.  The  accompanying  consolidated
financial  statements reflect the pushdown of the purchase  price
allocation  (amounts  in excess of book value)  to  the  Company.
Included in property, plant and equipment at June 30, 1997 is  an
aggregate  of  approximately $430 million related to  amounts  in
excess  of  the  original cost of the regulated facilities  as  a
result  of the Williams' and prior acquisitions.  This amount  is
being  amortized  over 40 years, the estimated  useful  lives  of
these  assets  at  the date of acquisition, at approximately  $11
million  per year.  Current Federal Energy Regulatory  Commission
(FERC) policy does not permit the Company to recover through  its
rates amounts in excess of original cost.
<PAGE>
   Certain reclassifications have been made in the 1996 financial
statements to conform to the 1997 presentation.

B.  Contingent Liabilities and Commitments

  Regulatory and Rate Matters and Related Litigation

   FERC Order 636

    Effective  November  1,  1993, the Company  restructured  its
business  to  implement the provisions of FERC Order 636,  which,
among other things, required pipelines to unbundle their merchant
role  from  their transportation services.  FERC Order  636  also
provides  that  pipelines should be allowed  the  opportunity  to
recover  all prudently incurred transition costs which,  for  the
Company,  are  primarily related to Gas Supply Realignment  (GSR)
costs  and  unrecovered purchased gas costs.  Certain aspects  of
the Company's FERC Order 636 restructuring are under appeal.

    On  July 16, 1996, the United States Court of Appeals for the
District  of Columbia issued an order which in part affirmed  and
in  part  remanded FERC Order 636.  On February  27,  1997,  FERC
issued  Order  636-C in response to the court's remand  affirming
that  pipelines may recover all of their GSR costs, but requiring
pipelines to individually propose the percentage of such costs to
be allocated to interruptible transportation services, instead of
a  uniform  10  percent allocation.  However, the  Company's  GSR
settlement, discussed below, is not subject to appeal and  should
be  unaffected  by  this  Order.  The  Order  also  prospectively
relaxed  the  eligibility  requirements for  receiving  no-notice
service  and  reduced the right of first refusal matching  period
from  20  years to five years.  FERC Order 636-C is still subject
to potential rehearing at the FERC.

    In  September 1995, the Company received FERC approval  of  a
settlement  agreement  which resolves all  issues  regarding  the
Company's  recovery of GSR costs.  The settlement  provides  that
the  Company will recover 100 percent of its GSR costs up to  $50
million, will share in costs incurred between $50 million and $80
million  and will absorb any GSR costs above $80 million.   Under
the settlement, all challenges to these costs, on the grounds  of
imprudence  or  otherwise,  will  be  withdrawn  and  no   future
challenges will be filed.  Ninety percent of the cost recovery is
being  collected through demand surcharges on the Company's  firm
transportation  rates;  the  remaining  10  percent   should   be
recovered from its interruptible transportation service.

    Through June 30, 1997, the Company has paid $76.2 million and
expects  to  pay  no  more  than $80.0  million  for  GSR  costs,
primarily as a result of contract terminations.  The Company  has
recovered  approximately $65.8 million,  plus  interest,  in  GSR
costs  and has recorded a regulatory asset of approximately  $1.4
million for the estimated future recovery of its GSR costs,  most
of  which will be collected from customers prior to December  31,
1997.
<PAGE>
   General Rate Issues

    On  April  30,  1997, the Company filed a general  rate  case
(Docket  No. RP97-344) which will be effective November 1,  1997,
subject  to  refund.   This new rate case  reflects  a  requested
annual revenue increase of approximately $70.9 million, based  on
filed  rates, primarily attributable to increases in the  utility
rate  base,  operating expenses and rate of  return  and  related
taxes.

1  Royalty Claims and Producer Litigation

    In  connection  with the Company's renegotiations  of  supply
contracts  with  producers  to  resolve  take-or-pay  and   other
contract claims, the Company has entered into certain settlements
which  may require the indemnification by the Company of  certain
claims for royalties which a producer may be required to pay as a
result  of such settlements.  The Company has been made aware  of
demands  on  producers for additional royalties and  may  receive
other  demands which could result in claims against  the  Company
pursuant  to  the  indemnification provision in its  settlements.
Indemnification for royalties will depend on, among other things,
the specific lease provisions between the producer and the lessor
and  the  terms  of the settlement between the producer  and  the
Company.  The Company may file to recover 75 percent of any  such
amounts  it  may  be required to pay pursuant to indemnifications
for  royalties  under  the provisions of  FERC  Order  528.   The
Company has provided reserves for the estimated settlement  costs
of its royalty claims and litigation.

   Other Litigation

    On July 18, 1996, an individual filed a lawsuit in the United
States District Court for the District of Columbia (D.C. District
Court)  against 70 natural gas pipelines and other gas purchasers
or  former gas purchasers.  All of Williams' natural gas pipeline
subsidiaries, including the Company, were named as defendants  in
the  lawsuit.   The plaintiff claimed, on behalf  of  the  United
States  under  the  False  Claims Act, that  the  pipelines  have
incorrectly measured the heating value or volume of gas purchased
by  the defendants.  The plaintiff claimed that the United States
had  lost  royalty payments as a result of these practices.   The
D.C.   District  Court  recently  dismissed  the  claims  against
Williams'  natural  gas  pipeline  subsidiaries,  including   the
Company, and most of the other defendants.

   Environmental Matters

     As  of  June  30,  1997,  the  Company  had  a  reserve   of
approximately  $3.5 million for estimated costs  associated  with
environmental assessment and remediation.  This estimate  depends
upon  a number of assumptions concerning the scope of remediation
that  will  be  required at certain locations  and  the  cost  of
remedial measures to be undertaken.  The Company is continuing to
conduct  environmental assessments and is implementing a  variety
of remedial measures that may result in increases or decreases in
the total estimated costs.

    The  Company used lubricating oils containing polychlorinated
biphenyls  (PCBs)  and,     although the use  of  such  oils  was
discontinued   in  the  1970's,  has  discovered   residual   PCB
contamination  in equipment and soils at certain  gas  compressor
station sites.  The Company continues to work closely with the U.
S.  Environmental  Protection Agency (EPA) and  state  regulatory
<PAGE>
authorities regarding PCB issues and has programs to  assess  and
remediate  such conditions where they exist, the costs  of  which
are a significant portion of the reserve discussed above.

    The  Company  currently  is either  named  as  a  potentially
responsible   party  or  has  received  an  information   request
regarding  its  potential involvement at  certain  Superfund  and
state  waste disposal sites.  The anticipated remediation  costs,
if  any,  associated with these sites have been included  in  the
reserve discussed above.

   The Company considers environmental assessment and remediation
costs  and  costs  associated with compliance with  environmental
standards  to be recoverable through rates, as they  are  prudent
costs  incurred in the ordinary course of business.   The  actual
costs  incurred will depend on the actual amount  and  extent  of
contamination discovered, the final cleanup standards mandated by
the  EPA  or  other governmental authorities, and other  factors.
The  Company's current rate design incorporates the  recovery  of
anticipated  environmental costs, and it is the Company's  intent
to  continue  seeking  recovery of such  costs,  as  anticipated,
through  rate  filings.  Therefore, the estimated  recoveries  of
environmental assessment and remediation costs have been recorded
as regulatory assets in the accompanying balance sheets.

   Summary of Contingent Liabilities and Commitments

   While no assurances may be given, the Company does not believe
that the ultimate resolution of the foregoing matters, taken as a
whole  and  after  consideration of  amounts  accrued,  insurance
coverage,   potential   recovery   from   customers   or    other
indemnification  arrangements, will  have  a  materially  adverse
effect  on  the Company's future financial position,  results  of
operations or cash flow requirements.


C.  Adoption of Accounting Standard

    The  Financial Accounting Standards Board (FASB)  has  issued
Statement  of  Financial  Accounting Standards  (SFAS)  No.  125,
"Accounting for Transfers and Servicing of Financial  Assets  and
Extinguishments  of  Liabilities,"  effective  for   transactions
occurring after December 31, 1996.  The adoption of this standard
has  not  had  a  material  impact  on  the  Company's  financial
position, results of operations or cash flow requirements.

D. Financing

    The Company filed a Form S-3 Registration Statement with  the
SEC  on May 16, 1997, to register debt securities of $200 million
to be offered for sale on a delayed or continuous basis.  On July
15,  1997, the Company sold $100 million of 7.25% Debentures  due
July  15, 2027.  The Debentures have no sinking funds and may  be
called at any time, at the Company's option, in whole or in part,
at a specified redemption price, plus accrued and unpaid interest
to  the  date  of  redemption.  Proceeds from  the  sale  of  the
Debentures were used to retire the Company's 9 5/8% Notes,  which
matured on July 15, 1997.
<PAGE>

Item  2.   Management's  Narrative Analysis  of  the  Results  of
           Operations
               (Filed Pursuant to General Instruction H)

                Financial Analysis of Operations
           Six Months Ended June 30, 1997 Compared to
                 Six Months Ended June 30, 1996


    The Company's gas sales result from requirements to meet  its
pre-Order  636  gas  purchase commitments, substantially  all  of
which  are  managed  by  the Company's gas  marketing  affiliate,
Williams  Energy  Service  Company, as exclusive  agent  for  the
Company.   Although the sales and purchase commitments remain  in
the Company's name, their management and any associated profit or
loss  is solely the responsibility of the agent.  Therefore,  the
resulting  sales  and purchases have no impact on  the  Company's
results of operations.

   Operating income was $1 million lower for the six months ended
June  30, 1997, than for the six months ended June 30, 1996,  due
primarily to favorable 1996 rate refund accrual adjustments and a
change in the mix of transportation volumes under different  rate
structures, largely offset by the favorable resolution in 1997 of
certain contractual issues.  Compared to 1996, net income was  $1
million lower primarily due to the same reasons discussed above.

     Operating   revenues   decreased   $27   million   primarily
attributable  to  lower  costs passed  through  to  customers  as
provided in the Company's rates. Total deliveries were 402.6 TBtu
and 414.4 TBtu for the six months of 1997 and 1996, respectively.

       Operating   expenses  decreased  $26   million   primarily
attributable  to lower costs of gas sold and lower costs  of  gas
transportation, both of which are passed through to customers.

                                
                Financial Condition and Liquidity

    Williams  intends  to maintain and expand the  existing  core
business  of  the  Company and to promptly  pursue  new  business
opportunities made available to the Company.  Through the  years,
the  Company  has consistently maintained its financial  strength
and  experienced strong operational results.  Williams' ownership
of  the  Company  further enhances its financial and  operational
strength, as well as allows the Company to take advantage of  new
opportunities  for growth.  The Company expects to access  public
and  private  capital markets, as needed, to finance its  capital
requirements.

    The Company is a participant with other Williams subsidiaries
in  a  $1  billion credit agreement under which the  Company  may
borrow  up  to  $200  million, subject  to  borrowings  by  other
affiliated  companies.  Interest rates vary with  current  market
conditions.   To date, the Company has had no amounts outstanding
under this facility.

    The Company filed a Form S-3 Registration Statement with  the
SEC  on May 16, 1997, to register debt securities of $200 million
to be offered for sale on a delayed or continuous basis.  On July
15,  1997, the Company sold $100 million of 7.25% Debentures  due
<PAGE>
July  15, 2027.  The Debentures have no sinking funds and may  be
called at any time, at the Company's option, in whole or in part,
at a specified redemption price, plus accrued and unpaid interest
to  the  date  of  redemption.  Proceeds from  the  sale  of  the
Debentures were used to retire the Company's 9 5/8% Notes,  which
matured on July 15, 1997.

    The  Company  is  a participant in Williams' cash  management
program.    The   advances  due  the  Company  by  Williams   are
represented  by  demand  notes payable. Those  amounts  that  the
Company anticipates Williams will repay in the next twelve months
are  classified  as  current  assets,  while  the  remainder  are
classified  as  noncurrent.  The interest  rate  on  intercompany
demand  notes is the London Interbank Offered Rate on  the  first
day of the month plus 0.35%.

      The Company's capital expenditures for the first six months
of  1997 and 1996 were $31 million and $15 million, respectively.
Capital  expenditures for 1997 are expected  to  approximate  $66
million.    The   Company's  debt  as  a  percentage   of   total
capitalization at June 30, 1997 and December 31, 1996  was  27.6%
and 27.0%, respectively.

    On  July 21, 1997, the Company filed an application with  the
FERC  to authorize construction, installation and operation of  a
4,600  horsepower compressor engine and associated facilities  at
its  Haughton  Compressor Station in Louisiana.  The  project  is
expected  to cost $6 million.  The Company proposes to  have  the
facilities in service by November 1, 1998.

    On  April  30,  1997, the Company filed a general  rate  case
(Docket  No. RP97-344) which will be effective November 1,  1997,
subject  to  refund.   This new rate case  reflects  a  requested
annual revenue increase of approximately $70.9 million, based  on
filed  rates, primarily attributable to increases in the  utility
rate  base,  operating expenses and rate of  return  and  related
taxes.

    The  FERC  recently  issued orders  addressing,  among  other
things,  the  authorized  rates of  return  for  several  of  the
Company's    interstate   natural   gas    pipeline    affiliates
(Affiliates).  In the orders, the FERC continued its practice  of
utilizing  a  methodology for calculating rates  of  return  that
incorporate  a  long-term growth rate component.   The  long-term
growth  rate  component used by the FERC is now a  projection  of
United  States  gross domestic product growth rates.   Generally,
calculating  rates  of  return  utilizing  a  methodology   which
includes  a long-term growth rate component results in  rates  of
return  that are lower than they would be if the long-term growth
rate  component  were  not  included  in  the  methodology.   The
Affiliates plan to challenge their respective FERC orders  in  an
effort  to  have the FERC change its rate of return  methodology.
Similar  issues may arise in the Company's new rate case,  to  be
effective  November 1, but would have no effect on the  Company's
current settled rates.

<PAGE>


                   PART II - OTHER INFORMATION



Item 6. Exhibits and Reports on Form 8-K

        (a)  Exhibits
               
             None

        (b)  Reports on Form 8-K

             None




<PAGE>






                        S I G N A T U R E


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.

                               TEXAS GAS TRANSMISSION CORPORATION



DATE: August 11, 1997             BY:/s/ N. A. Bacile

                                         N. A. Bacile
                                    Vice President and Chief
                                       Financial Officer