U.S. Securities and Exchange Commission
                        	Washington, D.C.  20549
 
                               	FORM 10-QSB

(Mark One)
[X]	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

       For the quarterly period ended         June 30, 1998        


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

       For the transition period from                   to                  

       Commission file number               0-2054                             

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


           Montana                               81-0267738        
(State or other jurisdiction of       (IRS Employer Identification No.)
incorporation or organization)   


            128 Second Street South, Great Falls, Montana   59405  
	                (Address of principal executive offices)


                            (406) 727-2600                              
	                     (Issuer's telephone number)


                           Not Applicable                                      
(Former name, former address and former fiscal year, if changed since last 
report)


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

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

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

                     	APPLICABLE ONLY TO CORPORATE ISSUERS

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

        Class                                Outstanding at June 30, 1998
$.05 Par Value Common Stock                        10,483,142 Shares


Transitional Small Business Disclosure Format (Check One): Yes    ; No  X 

<PAGE>


                              	TSI, INC.
    
                               	INDEX


                            	JUNE 30, 1998
                                                             Page Number
PART I

  Condensed Consolidated Financial Statements:

Balance Sheet
  June 30, 1998                                                    2     

Statements of Income and Comprehensive Income -
  Six Months and Three Months Ended June 30, 1998 and 1997         3     

Statements of Cash Flows -
  Six Months Ended June 30, 1998 and 1997                          4     

Notes to Consolidated Financial Statements		                       5     

  Management's Discussion and Analysis of the
    Statements of Income		                                         6     


PART II

  Other Information		                                              7     

  Signatures		                                                     8     


                                    1
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                                TSI, INC.

                       CONSOLIDATED	BALANCE SHEET

                          	AS OF JUNE 30, 1998

   ASSETS

Current Assets
   Cash                                                      $  13,732,860     
   Marketable & Government Securities, 
      at Fair Value                                              1,953,159      
   Receivables - Net                                               109,220      
           
            Total Current Assets                                15,795,239     

Other Assets                                          	
   Noncurrent Investments, at Fair Value                         8,094,034  
   Other Assets                                                      2,238 

Property, Plant and Equipment, Net	                                899,859  
                                                                    
                        TOTAL ASSETS	                        $  24,791,370     
   	

   LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities
  Accounts Payable and Accrued Liabilities                   $     184,524      
  Deferred Income Taxes	                                            88,100
  Due to Parent Company                                             99,731      

Total Current Liabilities                                          372,355
                          

Provison For Estimated Title and Escrow Losses	                  1,008,655
Minority Interests	                                                332,836
Excess of Fair Value of Net Assets Acquired Over Cost	              52,745
Deferred Income Taxes	                                           1,805,700   

Stockholders' Equity	

  Common Stock - $.05 Par Value,
   30,000,000 shares authorized,
   10,483,142 shares outstanding                                   524,157
  Additional Paid-In Capital	                                    8,665,957 
  Retained Earnings	                                             9,003,368
  Accumulated Other Comprehensive Income                         2,985,597 

             Total Stockholders' Equity	                        21,179,079

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	                   $ 24,791,370     


                	See Notes to Consolidated Financial Statements

                                       2

<PAGE>

                                  	TSI, INC.

                           	STATEMENTS OF INCOME

                          For The Three Months        For The Six Months
                                 Ended                      Ended        
                                June 30,                   June 30,       
                            1998        1997           1998         1997   
Operating Revenues      $1,401,124    $ 816,154     $2,293,649   $7,251,636 

Operating Expenses
   Salaries and Payroll
     Costs                 223,398      190,371        436,499      381,204 
   Depreciation             23,485       30,559         43,957       56,191 
   Other Expenses          731,987      225,150        906,018      918,590 

   Total Expenses          978,870      446,080      1,386,474    1,355,985 

                           422,254      370,074        907,175    5,895,651 


Amortization of
 Deferred Credit             2,055        2,055          4,110        4,110 

Minority Portion of
 (Income)                  (19,308)     (10,338)       (28,039)     (22,549)

Income Tax Expense          18,000      180,000       (162,000)  (2,050,000)

    Net Income             423,001      541,791        721,246    3,827,212 

Other Comprehensive Income
 Increase (Decrease) in
 Unrealized Holding Gains,
 Net of Income Taxes      (508,706)     226,236       (211,862)  (2,534,965)

Comprehensive Income    $  (85,705)   $ 768,027    $   509,384   $1,292,247




                 See Notes to Consolidated Financial Statements 

                                        3                                   

<PAGE>

                                 	TSI, INC.

                    CONSOLIDATED	STATEMENTS OF CASH FLOWS




                                                   For The Six Months Ended 
                                                          June 30,         

                                                    1998              1997    
     CASH FLOWS FROM OPERATING ACTIVITIES

Net Cash Provided (Used) By Operating
 Activities                                     $  591,211       $  (197,506)

     CASH FLOWS FROM INVESTING ACTIVITIES

Capital Expenditures Paid In Cash                  (23,710)          (23,650)  

Proceeds From Sales and Redemptions
  of Property, Plant and Equipment                    -                6,994 

Cash Purchases of Minority Interests                  (343)             (150)

Cash Used for Purchases of Marketable &
   Government Securities Available For Sale        (27,272)         (515,694)

Cash Received Upon Dispositions of Marketable
   Securities Available For Sale                    45,237         5,383,074 

Net Cash Provided (Used)
   By Investing Activities                          (6,088)        4,850,574

     CASH FLOWS FROM FINANCING ACTIVITIES

Cash Provided From Parent Company                   62,801            75,600 

Net Cash Provided By Financing
 Activities                                         62,801            75,600

NET INCREASE IN CASH                               647,924         4,728,668 

CASH - BEGINNING OF PERIOD                      13,084,936         8,525,699

CASH - END OF PERIOD                           $13,732,860       $13,254,367 


               	See Notes to Consolidated Financial Statements
 
                                      4

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                                 TSI, INC.

                  	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                              	June 30, 1998



In the opinion of management, all adjustments necessary (consisting of only 
normal recurring accruals) have been made to the unaudited financial 
statements to present fairly the financial position as of June 30, 1998 and 
the results of the Company's operations for the six months and three months 
ended June 30, 1998 and 1997 and cash flows for the six months ended June 30,
1998 and 1997.  

The results of operations for the six months and three months ended June 30, 
1998 and 1997 are not indicative of the results to be expected for the full 
year.

The consolidated financial statements include the accounts of the company, 
its wholly owned subsidiaries and its majority owned subsidiaries. All 
significant intercompany transactions and balances have been eliminated in 
consolidation.

M Corp owns approximately 92% of the Company's issued and outstanding common 
stock.

The Company adopted the provisions of Statement of Financial Accounting 
Standards No. 115, Accounting for Certain Investments in Debt and Equity 
Securities (SFAS No. 115) effective January 1, 1994.  The Company has 
classified its investments, both current and noncurrent, in debt and equity 
securities as Available-For-Sale, in accordance with the various 
classifications of securities contained in SFAS No. 115.

In accordance with SFAS No. 115, the Company's portfolios, current and 
noncurrent, of Available-For-Sale investments are carried at fair value in 
the Company's balance sheet at June 30, 1998. 

The net unrealized holding gains at June 30, 1998, net of the estimated 
income tax effects and minority interests in the unrealized holding gains, 
is included in Accumulated Other Comprehensive Income at June 30, 1998
in accordance with the provisions of Financial Accounting Standards N0. 130.



                                  5

<PAGE>



                              	TSI, INC.

                 	MANAGEMENT'S DISCUSSION AND ANALYSIS
	                        OF THE INCOME STATEMENT        

                            	JUNE 30, 1998



A summary of the period to period changes in items included in the statements
of income is shown below.


                                          COMPARISON           OF             

                                       THREE MONTHS          SIX MONTHS
                                           ENDED                ENDED
                                          JUNE 30,             JUNE 30, 
                                       1998 AND 1997        1998 AND 1997
                                        INCREASES            (DECREASES)      

Revenues                           $584,970    71.7%    $(4,957,987)  (68.3%)

Expenses                            532,790   119.4%         30,489     2.2%

Net Income                         (118,790)  (21.9%)    (3,105,966)  (81.1%)


Revenues decreased $4,957,987 in the first six months of 1998 as compared 
with the first six months of 1997 due to the gain recognized by the Company 
on the merger of Security Bancorp with and into WesterFed Financial 
Corporation which was completed during the first quarter of 1997. During 
1997, the Company recognized a gain on the merger in the pretax amount of 
approximately $5,351,000. No such gain was recognized during the first six 
months of 1998. During the first six months of 1998 the Company recognized a 
gain on the contribution of assets in kind to a charitable organization in 
the amount of approximately $417,000 as compared with a similar gain 
in the amount of $408,000 recognized during the first six months of 1997. 
The gains recognized during the first six months of 1997 were the primary 
reason for the decrease in revenues and the decrease in net income in 
the first six months of 1998 as compared with the first six months of 1997. 
The provision for income tax expense decreased $1,888,000 (92.1%) in the 
first six months of 1998 as compared with the first six months of 1997 due 
to the decrease in pretax income.



                       
                                      6

<PAGE>



                       
                                 	TSI, INC.

                                  	PART II

                            	OTHER INFORMATION


                              	JUNE 30, 1998


ITEM 1	LEGAL PROCEEDINGS

       None

ITEM 2	CHANGES IN SECURITIES AND USE OF PROCEEDS

       None

ITEM 3	DEFAULTS UPON SENIOR SECURITIES

       None

ITEM 4	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
          
       None

ITEM 5	OTHER INFORMATION

       None

ITEM 6	EXHIBITS AND REPORTS ON FORM 8-K

       None



                                    7

<PAGE>



                               	SIGNATURES


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





                            	 TSI, INC. 
	                            Registrant


Date:  August 7, 1998                  s/K. King          
                                         K. King
                                         Assistant Secretary-Treasurer


Date:  August 7, 1998                  s/Jerry K. Mohland       
                                         Jerry K. Mohland,
                                         Accountant





                                  8


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