FORM 10-QSB



Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act 
of 1934

For the quarterly period ended January 31, 1998

Commission File No. 2-33256


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


          	MISSOURI		                 					     44-0610086
(State or other jurisdiction of 					(I.R.S. Employer Identification No.)
 incorporation or organization)


13402 SOUTH 71 HIGHWAY, GRANDVIEW, MISSOURI  64030
(Address of principal executive offices)


(816) 761-6314
(Issuer's telephone number)


NONE
(Former name, former address and former fiscal year, if change 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 and (2) 
has been subject to such filing requirements for the past 90 days.

Yes    X     No        	


As of March 12, 1998, there were 2,809,364 shares of Common Stock, $.50 Par 
Value, outstanding.


TOROTEL, INC. AND SUBSIDIARIES



INDEX



PART I.      FINANCIAL INFORMATION

	Item 1.   Financial Statements

	          Consolidated Balance Sheet as of January 31, 1998		        		  1

	          Consolidated Statements of Operations for the nine months
	               ended January 31, 1998 and 1997						                     2

	          Consolidated Statements of Operations for the three months
	               ended January 31, 1998 and 1997						                     3

	          Consolidated Statements of Cash Flows for the nine months
	               ended January 31, 1998 and 1997					                   	  4

	          Notes to Consolidated Financial Statements					                5

	Item 2.   Management's Discussion and Analysis or Plan of Operation			   9



PART II.     OTHER INFORMATION

	Item 1.   Legal Proceedings							                                     	13

	Item 4.   Submission of Matters to a Vote of Security Holders	       			13

	Item 6.   Exhibits and Reports on Form 8-K			                        			13



SIGNATURES							                                                    				14


PART I.   FINANCIAL INFORMATION


Item 1.   Financial Statements

CONSOLIDATED BALANCE SHEET (Unaudited)
As of January 31, 1998

<TABLE>
<S>                                                     <C>

ASSETS

Current assets:
Cash		                                              					$    191,000
Accounts receivable, net				                            	   1,322,000
Inventories (Note 2)					                               	   3,065,000
Prepaid expenses and other current assets		            	      168,000
                                                 								   4,746,000

Property, plant and equipment, net				                      1,702,000

Deferred tax asset (Note 3)					                              228,000

Other assets							                                            28,000

                                                  								$ 6,704,000

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
	Short-term revolving credit line (Note 4)	             		$ 1,121,000
Current maturities of long-term debt (Note 5)		               105,000
Current maturity of note payable to former 
       officer (Note 6)	                                         -     
Trade accounts payable				                             	      642,000
Accrued liabilities (Note 6)		                       			      371,000
                                                 								   2,239,000

Long-term debt, less current maturities (Note 5)			         1,511,000

Note and interest payable to former officer (Note 6)		        428,000

Commitments and contingencies (Notes 6 and 7)		               486,000

Stockholders' equity (Note 8):
Common stock, at par value				                              1,440,000
Capital in excess of par value				                          8,672,000
Accumulated deficit	                                					  (7,867,000)
								                                                    2,245,000
Less treasury stock, at cost				                       	      205,000
                                                 								   2,040,000

                                                  								$ 6,704,000
</TABLE>

The accompanying notes are an integral part of these statements.





CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Nine Months Ended January 31,

<TABLE>
<S>                                            <C>             <C>
                                        							      1998     	      1997     	

Net sales	                                 					$  9,119,000   	$11,341,000
Cost of goods sold		                        			    7,006,000	     8,296,000

	Gross profit		                             			    2,113,000	     3,045,000

Operating expenses:
Engineering				                             		       581,000	       570,000
Selling, general and administrative 			            1,773,000	     2,313,000
                                        							    2,354,000	     2,883,000

	Earnings (loss) from operations			                 (241,000)	      162,000

Other income (expense):
	Interest expense				                        	      (204,000)	     (191,000)
Other, net 						                                    (71,000)	      (14,000)
                                       							      (275,000)	     (205,000)

Earnings (loss) before provision for income 
 taxes and cumulative effect of change in 
 method of accounting                    					      (516,000)	      (43,000)

Provision for income taxes (Note 3)			                  -               -     	

Earnings (loss) before cumulative effect of 
 change in method of accounting           				      (516,000)       (43,000)

Cumulative effect of change in method of 
 accounting	                                            -          (506,000)	

Net earnings (loss)	                        				$   (516,000)  	$  (549,000)


Earnings (loss) per common and common 
equivalent share:
    Earnings (loss) before cumulative effect		       $ (.18)	       $ (.02)
    Cumulative effect					                              -  	          (.18)	
                                    							          $ (.18)	       $ (.20)

Weighted average common and common equivalent
	shares outstanding		                       			    2,809,000	      2,801,000

</TABLE>

The accompanying notes are an integral part of these statements.



CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Three Months Ended January 31,

<TABLE>
<S>                                            <C>             <C>
                                         							     1998     	     1997     	

Net sales                                 						$ 2,477,000    	$ 3,506,000
Cost of goods sold		                        			   2,005,000	      2,597,000

	Gross profit					                                  472,000	        909,000

Operating expenses:
Engineering	                             					      185,000	        165,000
Selling, general and administrative 			             608,000	        597,000
                                       							      793,000	        762,000

	Earnings (loss) from operations			                (321,000)	       147,000

Other income (expense):
	Interest expense			                       		       (71,000)	       (64,000)
Other, net 						                                      -     	       (2,000)
                                      							       (71,000)	       (66,000)

	Earnings (loss) before provision for 
     income taxes                                  (392,000)	        81,000

Provision (credit) for income taxes (Note 3)		         -     	         -     	

Net earnings (loss)			                       		$   (392,000)   	$     81,000


Earnings (loss) per common and common 
   equivalent share                               $ (.14)	          $  .03

Weighted average common and common 
equivalent	shares outstanding		              			   2,809,000	      2,820,000

</TABLE>

The accompanying notes are an integral part of these statements.



CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Nine Months Ended January 31,

<TABLE>
<S>                                           <C>             <C>
                                         							     1998     	     1997     	

Cash flows from operating activities:
Net earnings (loss)			                       		$   (516,000)  	$   (549,000)

Adjustments to reconcile net earnings 
   to net cash provided by operations:
	Loss from estimated government penalty	             70,000	           -     
Depreciation and amortization			                    263,000	        245,000
Deferred tax asset				                                 -     	         -     
Increase (decrease) in cash flows from 
    operations resulting from changes in:
Accounts receivable			                              798,000	      1,334,000
Inventories		                               		     (271,000)	      (469,000)
Prepaid expenses and other assets	                  (70,000)	       (84,000)
Trade accounts payable			                          (311,000)	        22,000
Accrued liabilities				                             (89,000)	       (23,000)
                                        						      390,000	      1,025,000

Net cash provided by (used in) operating 
    activities	                                    (126,000)	       476,000

Cash flows from investing activities:
Capital expenditures		                      		     (105,000)	      (249,000)

Net cash used in investing activities		      	     (105,000)	      (249,000)

Cash flows from financing activities:
Borrowings against credit line			                 1,155,000	      4,394,000
Payments against credit line			                    (890,000)	    (4,574,000)
Proceeds from issuance of long-term debt		          451,000	        113,000
Principal payments on long-term debt		             (507,000)	       (87,000)
Payments on capital lease obligations		             (16,000)	        (9,000)
Note and interest payable to former officer		        32,000	            -     
Proceeds from issuance of common stock		               -      	      51,000
Acquisition of treasury stock		           		          1,000	        (50,000)

Net cash provided by (used in) financing 
    activities	                                     226,000	       (162,000)

Net increase (decrease) in cash		            		$     (5,000)	   $    65,000
Cash at beginning of year				                       196,000	        149,000

Cash at end of January		                    			$    191,000   	 $   214,000


Supplemental Disclosures of Cash Flow 
     Information
Cash paid during the period for:
Interest	                                   			$    172,000    	$    225,000
Income taxes		                              			$       -       	$       -     

</TABLE>

The accompanying notes are an integral part of these statements.



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)



Note 1 - Basis of Presentation

	The accompanying unaudited consolidated financial 
statements reflect the normal recurring adjustments which are, in the 
opinion of management, necessary to present fairly the company's 
financial position at January 31, 1998, and the results of operations 
for the three and nine months ended January 31, 1998.
	The financial statements contained herein should be read in 
conjunction with the company's financial statements and related 
notes filed on Form 10-KSB for the year ended April 30, 1997.


Note 2 - Inventories

 The components of inventories are summarized as follows:

<TABLE>
<S>                                                             <C>
 Raw materials, less allowance for obsolescence of $739,000	     $ 1,678,000
 Work in process							                                              963,000
 Finished goods	                                         						      424,000

                                                        									$ 3,065,000
</TABLE>

Note 3 - Income Taxes

	The net deferred tax asset included in the accompanying 
consolidated balance sheet at January 31, 1998, includes the tax 
effects of temporary differences and carryforwards which are the 
source of the deferred asset, less a valuation allowance.
	The components of the net deferred tax asset are 
summarized as follows:

<TABLE>
<S>                                <C>
Net operating loss carryforwards				$ 2,009,000
Inventory valuation reserve					        245,000
Tax credit carryforwards					           406,000
Property, plant and equipment					      188,000
Other								                            60,000
						                           		   2,908,000
Less valuation allowance					         2,680,000

                           								$    228,000
</TABLE>

	The tax credit and operating loss carryforwards expire in 
various amounts in the years 1998 through 2012.


Note 4 - Short-term Revolving Credit Line

	On September 2, 1997, the company renewed its revolving 
credit agreement with Phillipsburg National Bank & Trust Company 
(PNBT).  The credit agreement, which provides a $2,500,000 
revolving credit line, expires August 31, 1998.  Advances under the 
credit line are limited to the sum of 75% of eligible billed receivables 
and 50% of inventories, net of reserves.  The revolving credit line is 
collateralized by trade accounts receivable, inventories, and a third 
lien mortgage on OPT's facility.  Under the terms of the agreement, 
the outstanding balance of the revolving line bears interest at 1/2% 
over the bank's prime lending rate.  As of January 31, 1998, the 
company had utilized $1,121,000 of the revolving credit line and the 
effective borrowing rate was 9%.  The company is required to 
comply with certain covenants including restrictions on the payment 
of cash dividends.


Note 5 - Long-term Debt

	On December 23, 1997, Torotel Products, Inc. executed a 
$451,000 promissory note with PNBT.  Under the terms of the note, 
the outstanding balance bears interest at a fixed rate of 9-1/4% per 
annum through March 18, 2001, thereafter the rate will be adjusted 
annually and will fluctuate at 1/2% over the bank's base lending rate.  
The note requires monthly principal and interest payments of 
$4,678.  The note, which is guaranteed by Torotel, Inc. and OPT 
Industries, Inc., has a maturity date of December 23, 2012, and is 
collateralized by a first mortgage on the land and buildings in 
Grandview, Missouri, and the unimproved land in Kansas City, 
Missouri.  As of January 31, 1998, the outstanding balance on the 
note was $450,000.


Note 6 - Contingency for Estimated Penalty

	On May 6, 1997, Torotel Products, Inc. was accepted into 
the Voluntary Disclosure Program of the United States Department 
of Defense, resulting from its failure to perform some required 
"thermal shock" testing as frequently as required, and inaccurately 
certifying that all required testing had been performed.  As a result 
of the company's investigation into the thermal shock deficiencies, 
which was first reported in November 1996, the company recorded 
an estimated charge of $416,000 against earnings in its fiscal fourth 
quarter ended April 30, 1997.  Because the investigation was 
ongoing, the company subsequently determined that there also were 
some deficiencies in performing some required electrical testing as 
frequently as required.  As a result, the company recorded an 
additional estimated charge of $70,000 against earnings in its fiscal 
first quarter ended July 31, 1997.  The company does not anticipate 
incurring any additional major charges related to the investigation; 
however, the aggregate amount of the estimated penalty is still 
subject to fluctuation as further evidence is investigated.
	At this time, the company is not certain when payment of the 
damage amount will be required; however, the company does not 
anticipate making any payments during the next twelve months.  As 
a result, the entire $486,000 has been classified as a long-term 
liability in the accompanying consolidated balance sheet.
	The company believes that certain of its former officers may 
have been responsible for the misconduct related to the test failures, 
and continues to evaluate ways of recovering the damages.  In the 
meantime, the company has suspended all principal and interest 
payments due under a note payable to a former officer, and does 
not anticipate making any further payments during the next twelve 
months.  As a result, as of January 31, 1998, the aggregate amount 
due of $428,000, which consists of the outstanding principal of 
$384,000 plus the accrued interest of $44,000, has been classified 
as a long-term liability in the accompanying consolidated balance 
sheet.
	The legal fees associated with the DOD investigation have 
amounted to $58,000 during the current fiscal year, and $265,000 in 
aggregate since the investigation started last year.

Note 7 - Other Litigation

	Torotel, Inc. and Torotel Products, Inc. have both been 
named as defendants in a lawsuit brought by Joseph Turner in the 
U.S. District Court for the Western District of Missouri.  The case 
number is 96-0646-CV-W-5 and was filed on June 18, 1996.  
Plaintiff alleges a racially motivated failure to hire and that Torotel 
Products, Inc. has discriminated against minorities in its hiring 
practices.  Plaintiff's motion to have the case certified as a class 
action was approved by the court on September 30, 1997, with the 
court entering an Order Concerning Class Certification.  The court 
certified the case as a class action regarding the liability phase and 
deferred certification of a damage phase.  The case has a trial 
setting on May 4, 1998.  The company believes it has a meritorious 
defense and continues to vigorously defend the case.
	The legal fees associated with this lawsuit have amounted to 
$44,000 during the current fiscal year, and $78,000 in aggregate 
since the lawsuit was filed.

Note 8 - Employee Stock Options

	Employee stock options are accounted for under APB 
Opinion 25, Accounting for Stock Issued to Employees, and related 
interpretations.  The exercise price of each option equals the market 
price of the company's common stock on the date of grant.  
Accordingly, no compensation cost has been recognized.  The 
company chose not to adopt Statement of Financial Accounting 
Standards 123, Accounting for Stock-Based Compensation.  The 
difference in the two methods of accounting for stock options is not 
deemed to have a material effect on the fair value of the options at 
the grant date.
Stock option transactions under the 1994 Incentive 
Compensation Plan for the nine months ended January 31, 1998 
and 1997, are summarized as follows:

<TABLE>
<S>                              <C>        <C>        <C>         <C>
                    					                1998                  1997           	
	                            			 	Weighted	           		Weighted
				                            	 Shares   	 Average  	 Shares		   Average  
			                           		  Under   	 Exercise  	  Under 	   Exercise  
				                           	  Option 	    Price   	  Option 	   Price   	
Outstanding at beginning of year	 150,000	    $1.00	       -          -       
Granted				                          -		        -     	 150,000	    $1.00  
Exercised 				                       -          -          -          -        
Forfeited 				                       -          -          -          -        
Outstanding at end of January  		 150,000	    $1.00   	 150,000	    $1.00  
</TABLE>

<TABLE>
<S>                                     <C>      <C>       <C>      <C>
                           					              1998               1997         	
                                   					Weighted	        		Weighted
                                   					 Shares 	 Average 	 Shares 	 Average  
                                   				  Under 	 Exercise	  Under 	 Exercise  
                                  					  Option    Price    Option 	  Price   	

Options exercisable at end of January	     -         -        -         -       

Weighted average fair value of
     options granted during the year	                -       			        -     	
</TABLE>

The following information applies to options outstanding at January 31, 1998:

<TABLE>
<S>                                           <C>
Number outstanding				                    		   150,000	
Range of exercise prices					                  $1.00	
Weighted average exercise price				              $1.00	
Weighted average remaining contractual life			 7.85 years

</TABLE>


Item 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION



	The discussion and analysis of the results of operations 
includes the operations of Torotel, Inc., and its subsidiaries, Torotel 
Products, Inc. and OPT Industries, Inc.


NINE MONTHS ENDED JANUARY 31, 1998 VERSUS NINE 
MONTHS ENDED JANUARY 31, 1997

	Net sales decreased nearly 20%.  The net sales of Torotel 
Products decreased 7% from $4,693,000 to $4,356,000 due 
primarily to the elimination of some low-margin jobs for non-major 
customers, and production inefficiencies, which contributed to delays 
in the shipment of certain orders.  These decreases were offset 
partially by a $299,000 increase in sales of the potted coil assembly 
for the Hellfire II missile system.  OPT's net sales decreased 28% 
from $6,648,000 to $4,763,000 due primarily to lower sales of power 
supplies to a major customer.  No new orders are expected from this 
customer for several months, which will have a significant adverse 
impact on sales in the next few quarters.  Additionally, due to 
changing prototype requirements and development delays, orders 
for new power supply products are not expected to materialize for 
another few months.  As a result, OPT does not expect any 
significant increases in sales in the fourth fiscal quarter ending April 
30, 1998; however, higher sales are anticipated in fiscal year 1999.
	Gross profit as a percentage of net sales decreased nearly 
4%.  The gross profit percentage of Torotel Products decreased 
nearly 4% due primarily to labor inefficiencies resulting from certain 
design problems and the conversion to a computerized 
Information/MRP System.  The gross profit percentage of OPT 
decreased 4% due primarily to lower sales volume without a 
comparable decrease in fixed production costs.  This percentage 
decrease in the gross profit was offset partially by lower material and 
labor costs attributable to a change in the mix of product shipments.
	Engineering expenses increased 2%.  The engineering 
expenses of Torotel Products decreased 4% from $216,000 to 
$207,000 due primarily to a reduction in clerical personnel.  The 
engineering expenses of OPT increased nearly 6% from $354,000 to 
$374,000 due to a $9,000 increase in depreciation; a $6,000 
increase in operating supplies; and a $5,000 increase in travel costs.
	Selling, general and administrative (SG&A) expenses 
decreased 23%.  The SG&A expenses of Torotel, Inc. decreased 
29% from $252,000 to $178,000 due primarily to a $36,000 
decrease in compensation costs arising from a bonus awarded in 
fiscal 1997; a $19,000 decrease in travel costs; a $13,000 decrease 
in professional fees; and a $6,000 decrease in consulting costs.  The 
SG&A expenses of Torotel Products decreased 32% from 
$1,277,000 to $865,000 due primarily to a $251,000 restructuring 
charge incurred in fiscal 1997; a $75,000 decrease in payroll costs 
due to a reduction in personnel; a $50,000 decrease in professional 
fees; an $18,000 decrease in sales commissions; an $11,000 
decrease in disposal costs for hazardous materials; and a $7,000 
decrease in advertising costs.  The SG&A expenses of OPT 
decreased 7% from $784,000 to $730,000 due primarily to an 
$18,000 decrease in professional fees; a $14,000 decrease in office 
supplies; a $10,000 decrease in sales commissions; a $10,000 
decrease in computer maintenance costs; and a $7,000 decrease in 
bank charges.  These decreases were offset partially by a $5,000 
increase in consulting costs.
	Interest expense increased 7%.  The interest expense of 
Torotel, Inc. remained unchanged at $31,000.  The interest expense 
of Torotel Products increased nearly 43% from $68,000 to $97,000 
due to a higher aggregate borrowing level.  The interest expense of 
OPT decreased 17% from $92,000 to $76,000 due to a lower 
aggregate borrowing level.
	Sundry non-operating expense increased due primarily to a 
$70,000 charge in the current fiscal year for an estimated penalty as 
discussed in Note 6 of Notes to Consolidated Financial Statements.
	For the reasons discussed above, the consolidated pretax 
loss increased from $43,000 to $516,000.  The pretax loss of 
Torotel, Inc. decreased from $284,000 to $209,000.  The pretax loss 
of Torotel Products decreased from $185,000 to $121,000.  The 
pretax earnings of OPT decreased from a profit of $426,000 to a 
loss of $186,000.


THREE MONTHS ENDED JANUARY 31, 1998 VERSUS THREE 
MONTHS ENDED JANUARY 31, 1997

	Net sales decreased 29%.  The net sales of Torotel 
Products decreased 5% from $1,394,000 to $1,322,000 due 
primarily to production inefficiencies, which contributed to delays in 
the shipment of certain orders.  OPT's net sales decreased 45% 
from $2,112,000 to $1,155,000 due primarily to lower sales of power 
supplies to a major customer.  No new orders are expected from this 
customer for several months, which will have a significant adverse 
impact on sales in the next few quarters.  Additionally, due to 
changing prototype requirements and development delays, orders 
for new power supply products are not expected to materialize for 
another few months.  As a result, OPT does not expect any 
significant increases in sales in the fourth fiscal quarter ending April 
30, 1998; however, higher sales are anticipated in fiscal year 1999.
	Gross profit as a percentage of net sales decreased 7%.  
The gross profit percentage of Torotel Products decreased 11% due 
primarily to labor inefficiencies resulting from certain design 
problems and the conversion to a computerized Information/MRP 
System.  The gross profit percentage of OPT decreased 5% due 
primarily to lower sales volume without a comparable decrease in 
fixed production costs.  This percentage decrease in the gross profit 
was offset partially by lower material and labor costs attributable to a 
change in the mix of product shipments.
	Engineering expenses increased 12%.  The engineering 
expenses of Torotel Products increased slightly from $65,000 to 
$66,000.  The engineering expenses of OPT increased 19% from 
$100,000 to $119,000 due primarily to higher costs associated with 
the development of the new power supply products.
	Selling, general and administrative (SG&A) expenses 
increased 2%.  The SG&A expenses of Torotel, Inc. decreased 9% 
from $67,000 to $61,000 due primarily to a $6,000 decrease in 
travel costs.  The SG&A expenses of Torotel Products increased 4% 
from $296,000 to $309,000 due primarily to a $17,000 increase in 
payroll costs and a $5,000 increase in consulting costs.  These 
increases were offset partially by a $9,000 decrease in sales 
commissions.  The SG&A expenses of OPT increased 2% from 
$234,000 to $238,000 due primarily to a $19,000 increase in payroll 
costs; an $11,000 increase in advertising costs; and a $5,000 
increase in consulting costs.  These increases were offset partially 
by a $14,000 decrease in sales commissions; a $10,000 decrease in 
office supplies; and a $7,000 decrease in professional fees.
	Interest expense increased 11%.  The interest expense of 
Torotel, Inc. remained unchanged at $10,000.  The interest expense 
of Torotel Products increased 48% from $25,000 to $37,000 due to a 
higher aggregate borrowing level.  The interest expense of OPT decreased 
17% from $29,000 to $24,000 due to a lower aggregate borrowing 
level.
	For the reasons discussed above, consolidated pretax 
earnings decreased from a profit of $81,000 to a loss of $392,000.  
The pretax loss of Torotel, Inc. decreased from $77,000 to $71,000.  
The pretax earnings of Torotel Products decreased from a profit of 
$58,000 to a loss of $131,000.  The pretax earnings of OPT 
decreased from a profit of $100,000 to a loss of $190,000.


LIQUIDITY AND CAPITAL RESOURCES

	Historically, the company has relied on funds generated 
internally and bank borrowings to meet its normal operating 
requirements and to service bank indebtedness.  For the nine 
months ended January 31, 1998, the company incurred a pretax loss 
of $516,000.  This amount consisted of $344,000 in actual operating 
losses, $172,000 in special legal fees, and another $70,000 for an 
estimated penalty (see Notes 6 and 7 of Notes to Consolidated 
Financial Statements).  While management does anticipate an 
improvement in sales and operating earnings at Torotel Products 
during the next few months, this operation will continue to incur 
substantial legal costs for the class-action discrimination suit 
discussed in Note 7 of Notes to Consolidated Financial Statements.  
In all probability, these legal costs will offset the anticipated 
improvement in operating earnings.  As for OPT, management does 
not anticipate any substantial increase in the present rate of sales 
during the next few months.  As a result, further losses from this 
operation are likely.  As of January 31, 1998, the company is in 
compliance with all financial covenants under the terms of the credit 
agreement with Phillipsburg National Bank & Trust Company 
(PNBT).  However, given the short-term outlook and the ongoing 
legal costs, it is likely that the company will be in violation of one or 
more of the covenants as of April 30, 1998.  If this occurs, and the 
bank does not waive compliance with the subject provisions, one of 
the remedies available to the bank is to demand full payment of all 
outstanding indebtedness, which is $2,670,000 at January 31, 1998.  
While the company may be able to find an alternate source for 
financing, it would likely be short-term in nature, carry substantially 
higher costs and lending rates, and be much more restrictive for 
liquidity purposes.  In any event, regardless of the financing 
arrangements, it is becoming, and will continue to be, increasingly 
difficult for the company to generate positive cash given the cash 
requirements of the ongoing litigation matters.
	During the nine months ended January 31, 1998, the 
company's operating activities used $126,000 in cash flow.  
Corporate related matters used $214,000.  The operations of Torotel 
Products used $313,000 due primarily to increased inventories and 
lower levels of trade payables and other liabilities.  OPT's operations 
provided $401,000 due primarily to a lower level of receivables.
	Investing activities used $105,000 in cash flow for capital 
expenditures for production and engineering equipment.  For the 
balance of the fiscal year, the company anticipates additional 
investments of approximately $15,000 for capital expenditures.
	Financing activities provided $226,000 in cash flow due 
primarily to increases in the revolving credit line.  At January 31, 
1998, the company had used $1,121,000 of its revolving credit line 
and had $1,379,000 available for future cash requirements, based 
on the lender's borrowing base formula and subject to compliance 
with the financial covenants contained in the credit agreement with 
PNBT, as discussed above.
	The company believes that inflation will have only a minimal 
effect on future operations since such effects will be offset by sales 
price increases which are not expected to have a significant effect 
upon demand.


OTHER

	Except for historical information contained herein, certain of 
the matters discussed above are forward-looking statements that are 
subject to certain risks and uncertainties that could cause actual 
results to differ materially from those set forth in the forward-looking 
statements, including the company's dependence on timely 
development, introduction and customer acceptance of new 
products, the impact of competition and price erosion as well as 
supply and manufacturing constraints, and other risks and 
uncertainties (see Notes 6 and 7 of Notes to Consolidated Financial 
Statements, and the Liquidity and Capital Resources section of 
Management's Discussion and Analysis or Plan of Operation).



PART II.   OTHER INFORMATION

Item 1.   Legal Proceedings

	There are two legal proceedings involving the company.  In 
the first matter, Torotel, Inc. and Torotel Products, Inc. have both 
been named as defendants in a lawsuit brought by Joseph Turner in 
the U.S. District Court for the Western District of Missouri.  The case 
number is 96-0646-CV-W-5 and was filed on June 18, 1996.  
Plaintiff alleges a racially motivated failure to hire and that Torotel 
Products, Inc. has discriminated against minorities in its hiring 
practices.  Plaintiff's motion to have the case certified as a class 
action was approved by the court on September 30, 1997, with the 
court entering an Order Concerning Class Certification.  The court 
certified the case as a class action regarding the liability phase and 
deferred certification of a damage phase.  The case has a trial 
setting on May 4, 1998.  The company believes it has a meritorious 
defense and continues to vigorously defend the case.
	In the second matter, on May 6, 1997, Torotel Products, Inc. 
was accepted into the Voluntary Disclosure Program by the 
Inspector General of the United States Department of Defense, 
resulting from its failure to perform some required testing as 
frequently as required, and inaccurately certifying that all required 
testing had been performed.  As a result of the company's 
investigation into the testing deficiencies, the company has recorded 
an estimated charge of $486,000.  The estimated penalty is still 
subject to fluctuation as further evidence is investigated.  The 
company believes that certain of its former officers may have been 
responsible for the misconduct related to the test failures, and is 
evaluating ways of recovering the damages.  In the meantime, the 
company has suspended all payments under a note payable to a 
former officer.

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

The Annual Stockholders' Meeting was held in Kansas City, 
Missouri, on September 15, 1997, to elect a Board of Directors.  At 
the meeting, there were 1,679,603 shares voting in the election, with 
nominees needing 839,803 shares to be elected.  Shareholders 
elected the following individuals to a one-year term on the Board of 
Directors, with the voting results indicated.

<TABLE>
<S>                            <C>           <C>
                                     								   Votes
                                  Votes      	Against or
                                   For       	 Withheld 	
Dale H. Sizemore, Jr.         		1,634,372	     45,231
Ronald L. Benjamin	            	1,623,608	     55,995
Christian T. Hughes           		1,638,051	     41,552
Dr. Thomas L. Lyon, Jr.       		1,636,492	     43,111
Richard A. Sizemore	           	1,634,372	     45,231
</TABLE>

Item 6.   Exhibits and Reports on Form 8-K

	a)	Exhibit 27 -- Financial Data Schedule (electronic filings only)
b) Reports on Form 8-K -- There were no reports filed on Form 8-K during 
the three months ended January 31, 1998.


SIGNATURES



	In accordance with the requirements of the Securities 
Exchange Act of 1934, the Registrant caused this report to be 
signed on its behalf by the undersigned, thereunto duly authorized.


Torotel, Inc.
(Registrant)




Date:       March 16, 1998      				/s/  H. James Serrone                   	
                                  							H. James Serrone
                                  							Vice President of Finance and 
                                  							Chief Financial Officer