U.S. SECURITIES AND EXCHANGE COMMISSION
                        WASHINGTON, D.C. 20549
                               FORM 10-KSB

(Mark One)
[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, 1996  
 
[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES ACT OF 1934 (No Fee Required)
         For the transition period              to              
                                   ------------    -----------
             
                 Commission file number   2-92949-S    

                 ELECTRONIC SYSTEMS TECHNOLOGY, INC.
            (Name of small business issuer in its charter)

            Washington                           91-1238077          
(State or other jurisdiction of    (I.R.S. Employer Identification No.)
  incorporation or organization)

   415 N. Quay St., Kennewick, Washington                99336   
  (Address of principal executive offices)            (Zip Code)

             Issuer's telephone number  (509) 735-9092 

Securities registered under Section 12(b) of the Exchange Act:  None
Securities registered under Section 12(g) of the Exchange Act:  None

  Check whether the issuer (1) filed all reports required 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 [ ]  

  Check if there is no disclosure of delinquent filers in response to 
Item 405 of Regulations S-B is met contained in this form, and no 
disclosure will be contained, to the best of the registrant's 
knowledge, in definitive proxy or information statements incorporated 
by reference in Part III of this Form 10-KSB or any amendment to this 
Form 10-KSB.  [ ]  Not applicable [X]
  
   State issuer's revenues for its most recent fiscal year. $1,443,549.

  On January 21, 1997 the aggregate market value, based on the average 
of the bid and asked Price, of the voting stock held by nonaffiliates 
of the registrant was $1,239,940.

  The number of shares outstanding of the registrant's common stock as 
of January 21, 1997:  4,953,667 shares.







<PAGE>
     DOCUMENTS INCORPORATED BY REFERENCE
   The following documents are incorporated by reference into Parts I, 
II, III, and IV of this report:  (1) Form S-18, effective Nov. 5, 1984, 
Commission File No. 2-92949-S; (2) Form 8-K, filed March 15, 1985, 
Commission File No. 2-92949-S; Forms 8-K dated July 12, 1991, December 
14, 1992, December 10, 1993, Form 8-K/A, dated February 3, 1995, and 
Forms 8-K, dated February 9, 1996 and February 7, 1997.

Transitional Small Business Disclosure Format:  Yes [ ]   No [X]
<PAGE>
                             PART I

                             ITEM 1

FORWARD LOOKING STATEMENTS:

When used in this Annual Report and the documents incorporated 
herein by reference, the words "believes", "anticipates", "expects" 
and similar expressions are intended to identify in certain 
circumstances, forward-looking statements.  Such statements are 
subject to a number of risks and uncertainties that could cause 
actual results to differ materially from those projected, including 
the risks described in this Annual Report.  Given these 
uncertainties, readers are cautioned not to place undue reliance on 
such statements.  The Company also undertakes no obligation to 
update those forward-looking statements.
  
                            BUSINESS  

Electronic Systems Technology, Inc. ("EST" or the "Company") 
specializes in the manufacturing and development of wireless modem 
products.  The Company uses its research and development, 
manufacturing, and marketing efforts to produce and market the 
Company's line of ESTeem (TM) Wireless Modem products and 
accessories.  The Company offers a product line which provide 
innovative communication solutions for applications not served by 
existing conventional communication systems.  The product line is 
offered in the growing markets for process automation in 
commercial, industrial, and government arenas domestically, as well 
as internationally.  The Company's product line is marketed through 
direct sales, sales representatives, Original Equipment 
Manufacturers (OEM's), and domestic, as well as foreign, resellers. 

The Company was incorporated in the State of Washington in 
February, 1984, and was granted a U.S. Patent for the "Wireless 
Computer Modem" in May 1987, and the Canadian patent in October 
1988.  During the past three years, the Company has continually 
refined its product line in response to customer needs, most 
recently developing a new generation of faster, more flexible, 
ESTeem products which were released in the fourth quarter of 1996. 
The Company has continued to expand its customer base, particularly in 
the industrial controls arena with its efforts to team with all 
major programmable logic controller (PLC) hardware vendors.  The 
Company has also been a hardware provider on Government programs 
such as the Core Automated Maintenance System (CAMS) for the U.S. 
Air Force, and Automatic Identification  Technology  (AIT) for the 
U.S. Army.  In 1996, the Company continued to participate in both 
foreign and domestic Supervisory Control and Data Acquisition 
(SCADA) and Industrial Controls marketplaces, as well as in 
Government markets.  
 
                       PRODUCTS AND MARKETS

EST's product line is a family of narrow band, packet burst, VHF & 
UHF FM radio modems provide communication links between computers, 
peripherals, and instrumentation controls using radio frequency 
waves.

<PAGE>
Increasing computer applications in the business and industrial 
environment are continuously placing new requirements on data 
transfer.  Prior to the invention of the ESTeem modem, the majority 
of data transfers used telephone modems or direct cable 
connections.  Both of these alternatives had a costly side effect. 
When utilizing telephone modems, there is a monthly charge for the 
use of telephone lines.  When using direct cable connections the 
cost of installing cable systems will usually cost as much or more 
than the cost of the communication system.  ESTeem wireless modem 
products provide a "Wireless Solution" by eliminating the need for 
conventional hardwiring and leased phone lines. 

All of the ESTeem models  ("ESTeems")  come with the industry 
standard asynchronous communications ports to give the user a new 
dimension to "Local Area Networking".  As many as 253 devices can 
be interfaced on a single frequency.  ESTeem wireless modems have 
over one hundred internal software commands to allow the user to 
easily configure the unit for any application or use.  The ESTeem 
setup parameters are saved in its own non-volatile memory.

ESTeem Modems work on a packet burst communications concept.  
Packet systems, whether hardwired or radio, share the same 
principle of operation: data is taken from a standard RS-232C or 
RS-422 asynchronous port and is transmitted in "Electronic Packets" 
(i.e. electronic packets of information).  The size of the packet 
can be defined by the user from 1 to 1010 bytes of information.  
Once a packet of data is formed, it is transmitted in a "burst," 
from one ESTeem modem to another ESTeem modem, hence the term 
"packet burst communications." ESTeem Modems provide data accuracy 
of greater than one part in 100 million.  The ESTeems have 
frequency agility in the VHF and UHF frequency ranges.  Internal 
Digi-Repeater features allow the user to increase operating range 
by relaying transmission through a maximum of three ESTeems to 
reach the destination ESTeem. An ESTeem can operate as an operating 
node, a repeater node, or both simultaneously, for added 
flexibility.

"Private Data Communications" is provided by the use of the ESTeem 
firmware, Synchronous Data Link Control (SDLC), bit compression, 
and Manchester encoding techniques.  The user can define over four 
different security code and communications parameter groups that 
allow communication access to the "Radio Area Network".  If higher 
security is required, the ESTeem is compatible with asynchronous 
Data Encryption Standard (DES) encryption devices.















<PAGE>
                        PRODUCT APPLICATIONS

Some of the major applications and/or industries for which the 
ESTeem products are being utilized are as follows:

   Water and Waste Water Industry        Transportation
   Industrial Process Control            Overhead Crane Control
   Remote Data Acquisition (SCADA)       Shop Floor Manufacturing
   Law Enforcement/Public Safety         Intra-Office/Building   
                                             Computer Networking

   Petroleum Industry                    Federal
 	  	Oil and Gas Pipeline                  Ground Mobile 
Communications
          Offshore Production              Ship to Shore Communications
          On-shore Production              Flight Line Maintenance
          Tank Farm                        
		
PRODUCT LINES

VHF RADIO MODEM PRODUCTS:  Operating in the mid 60-70 MHz band of 
the VHF RF spectrum.  The ESTeem VHF radio modem products are the 
ESTeem Model 85 and Model 95.  

     The standard production units of the ESTeem Model 85 and 95 
     are configured to operate in the lower 70 MHz spectrum. The 
     frequency and receiver sensitivity of the Model 85 ESTeem is 
     field adjustable via switches on the rear of the unit. The 
     Model 95 ESTeem has the same features as the Model 85 with the 
     following additional technical enhancements: software 
     frequency agility, software selectable receiver sensitivity, 
     and received signal strength option.  Listed below are the 
     major markets for these products:

     Domestic: Industrial control, SCADA, and inventory control.
     International: Telephone by-pass, industrial control, and SCADA.
     Federal: Inventory and command control.

UHF RADIO MODEM PRODUCTS: Operating in the lower 400 MHz federal 
radio band, and the mid to upper 400 MHz  commercial radio band of 
the UHF RF spectrum.  The ESTeem UHF radio modem products are the 
ESTeem Model 192C, 192F, 96F, 98F, and 96C. 

     The UHF radio modem products, ESTeem Models 192C, 192F, 96F, 
     98F, and 96C, have the same features as the VHF radio modem 
     products, but were designed to operate in the lower 400 and 
     upper 400 MHz areas of the UHF RF spectrum. The new product 
     released in 1996 is the ESTeem Model "192 product line".  The 
     192 product line is differentiated from the other UHF radio 
     modem products by having a data rate of 19,200 bits per second 
     (bps). This data rate is four times faster than the data rates 
     of the 96 and 98 product lines.  The 192 product line contains 
     infrared and telephone interfaces which are not available on 
     the 96 and 98 product lines.  The 192C  was designed to 
     operate in business radio bands of upper 400 MHz. The ESTeem 
     Model 192F was designed to operate in U.S. Government radio 
     bands of lower 400 MHz.  The ESTeem Model 96F is designed to 
     operate in the lower 400 MHz United States Federal radio 
     frequency bands.  The ESTeem Model 98F is a variant of the 
     Model 96F designed to operate in extreme vibration 
<PAGE>
     environments, used mainly by the U.S. Federal Government for 
     command control applications.  The ESTeem Model 96C was 
     designed to operate in business radio bands of upper 400 MHz. 
     All of the UHF radio modem products have the additional 
     following technical capabilities: software frequency agility, 
     software selectable receiver sensitivity, and RF output power 
     from two to four watts depending on customer licensing.  
     Listed below are the major markets for these products:

     Domestic: Industrial control, SCADA, and inventory control.
     International: Telephone by-pass, industrial control and SCADA.
     Federal: Inventory and command control.
	
SPECIALTY MODEM PRODUCTS: Network enhancing products using ESTeem 
modem technology.  The ESTeem specialty modem products are the 
ESTeem Model 84SP, 85SP and Port Expansion Module. 

     The ESTeem Models 84SP and 85SP are special purpose versions 
     of the ESTeem Model 85 without radio transceiver circuitry. In 
     place of the transceiver card is a universal interface card 
     that allows the use of a customer's full- or half-duplex radio 
     transceiver, turning it into a packet burst communications 
     device.  The Model 85SP is a lower cost version of the 84SP 
     and contains only the necessary circuitry for interfacing to 
     direct digital modulated radios. The major market for these 
     products are civilian SCADA and public safety applications.

     The ESTeem Port Expansion Module (PEM) is designed to allow a 
     single ESTeem product to have up to eight independent RS-
     232/422 communications ports.  The PEM is designed with 
     interfaces to be cascaded to additional PEM modules to 
     increase the communications ports in multiple groups of eight. 
     The major market for this product is main frame to remote 
     terminal applications in the Domestic, Foreign, and Federal 
     markets.

ADDITIONAL PRODUCTS AND SERVICES 

     The Company also sells various accessories for its EST    
     product lines.  Accessories are purchased from other    
     manufacturers and resold by EST to support the application    
     of ESTeem modems. Antennas, power supplies and cable  
     assemblies are examples of such items.  The Company also 
     provides Factory Services, such as repair and upgrade of 
     ESTeem products.  To assist in the application of ESTeem    
     wireless modems the Company provides professional services, 
     site survey testing, system start-up, and custom 
     engineering, which are billed to customers at a standard 
     rate, plus expenses. 
 
              RESEARCH AND DEVELOPMENT AND NEW PRODUCTS

Due to the rapidly changing technology environment of the 
communications industry, specifically standards and technologies 
are subject to rapid and unexpected changes in the markets in which 
the Company's products compete. This environment results in the 
Company continually being required to update and  enhance its 
existing products, as well as develop new products in order to 
remain competitive.  Research and Development expenditures for new 
<PAGE>
product development and improvements of existing products by the 
Company for 1996 and 1995 were $135,468 and $85,265, respectively. 
None of the Company's research and development expenses are 
directly paid for by any of the Company's customers. In 1996, the 
Company contracted with an independent engineering company 
specializing in radio design, when that expertise is required.  

The Company had under development during 1996, a new generation 
of ESTeem products, the ESTeem 192, which received Federal 
Communication Commission (FCC) Type Acceptance on January 3, 
1997. The ESTeem 192 products were originally scheduled for release
during the second quarter of 1996, but due to delays from third-party
service providers, and orientation and instruction issues surrounding
the use of surface mount technology, the product line was not released
until late in the fourth quarter of 1996.  The new product line is
planned to eventually replace existing product lines in the VHF and UHF 
radio modem product categories.  Development is continuing on a 
line of radio modem products, scheduled for release late 1997.  
These products are targeted for applications within the 
Industrial Control and Federal markets. The Company plans on 
continued research and development expenditures and to undertakes 
new development and improvement projects as they become necessary. 

              MARKETING, CUSTOMERS AND SUPPORT

The majority of the Company's products are sold and distributed 
directly from the Company's facility through direct sales to end 
users of the ESTeem products.  The remainder of the Company's sales 
are through non-exclusive, non-stocking Resellers, and Original 
Equipment Manufacturers (OEM's).  Normally, ninety-five percent of 
the Company's products are distributed through direct sales and 
five percent are through Reseller and OEM entities.  The Company 
carries a minimal amount of backlog, if any.  Customers generally 
place orders on an "as needed basis".  Shipping dates for most 
products are generally within 5 working days after receipt of an 
order.  As of December 31, 1996, the Company had a backlog of 
$89,065, for orders placed late in December.  The majority of these 
orders were shipped within the first two weeks of January, 1997.

During 1996, the Company advertised in trade publications targeted 
at users of control, instrumentation, and automation systems 
worldwide.  The Company's advertising is targeted toward customers 
using Programmable Logic Controllers (PLCs).  There are 
approximately twenty five major PLC manufacturers worldwide.  The 
Company also attends tradeshows each year specifically targeted 
toward the customers and markets in which it sells products.

The Company maintains an Internet web site to provide easy access 
to product and technical information for both present and potential 
customers of the Company's products.  The Company provides 
technical support and service for its products through phone 
support, field technicians, and Internet sources.  The Company 
believes high quality customer and technical support is necessary 
and vital to its business and the markets in which it competes.  To 
maintain this high level of customer support the Company has in the 
past, and will continue in the future, to make investments and 
expenditures in support of its customer service programs. 


<PAGE>
The Company is continuing its Government sales activities which are 
directed towards all branches of the United States Armed Services. 
Examples of projects the Company's products are included in are 
flight-line maintenance for the United States Air Force,  flight-
line lighting for the United States Navy, command and inventory 
control for the United States Marine Corps, and the Automatic 
Identification Technology program for the United States Army.  

For the year ended December 31, 1996, the largest sales 
concentration were to entities of the United States Government, 
which amounted to 22% of total product sales for the year.  Foreign 
sales were 17% of total revenues for 1996.  No other sales to a 
single customer comprised 10% or more of total product sales as of 
December 31, 1996. See "Management's Discussion and Analysis of 
Financial Condition and Results of Operations", and 
"Financial Statements".

The Company has a General Services Administration (GSA) contract to 
sell goods to the U.S. Government.  This contract is a fixed price, 
indefinite quantity and delivery agreement.  The current contract 
runs through March 31, 1997.  A renewal GSA contract is being 
negotiated. 

The Company participates in Government programs with contracts 
administered by UNISYS Corporation and Intermec Corporation.  Both 
contracts are fixed price, indefinite quantity and delivery 
agreement.  The current UNISYS contract expires September 30, 1997 
and the current Intermec contract expires September 30, 1999.

                          COMPETITION

The Company's competition varies according to the market in which 
the Company's products are competing.  All of the markets in which 
the Company's products are sold are highly competitive.  Listed 
below are the markets  the Company's products compete in and 
competition in those markets:

Major Market                      Major Competitors

Remote Data Acquisition,          Aerotron-Repco, Data-Linc, GRE 
Industrial Control, Shop Floor    America, Johnson, Maxon,
Manufacturing, Overhead Crane     Microwave Data Systems,
Control                           Motorola, Metricom, and Proxim

Computer Networking inter and     Aironet Wireless Communications,
intra building.                   Cylink, Digital Wireless,
                                  Metricom, and Proxim

Radio Area Networking of hand     Intermec, LXE, Norand,
held data collection terminals    Symbol/MSI, and Telxon
and bar coding

Federal applications              Data Radio, Datron, Harris,
                                  Lockheed Martin, Magnavox,
                                  Motorola, Siemens, Watkins-
                                  Johnson, and California Microwave



<PAGE>
Management believes the ESTeem products compete favorably in the 
market because of performance, price, and adaptable to a wide range 
of applications.  The Company's major limitation in competing with 
other manufacturers is its limited marketing budget.

        PATENTS, TRADEMARKS, AND PROPRIETARY INFORMATION

EST was granted a United States patent in 1987 for a "Wireless 
Computer Modem".  In 1988, EST was granted a Canadian Patent for a 
"Wireless Computer Modem".  Both patents have lives of 17 years.  
Trademark for the ESTeem Wireless Modem was granted in 1985. 

To protect the Company against unauthorized disclosure of 
proprietary information belonging to the Company, all employees, 
dealers, distributors, original equipment manufacturers, sales 
representatives and other persons having access to confidential 
information regarding Company products or technology are required 
to sign non-disclosure agreements.

                       GOVERNMENT REGULATION

For operation in the United States, the ESTeem RF Modems require 
Federal Communications Commission (FCC) Type Acceptance.  The FCC 
Type Acceptance is granted for devices which demonstrate operation 
within performance criteria mandated, observed, and tested by the 
FCC. All of the Company's products requiring FCC Type Acceptance 
have been granted such acceptance. 

For operation in Canada, the ESTeem RF Modems require Canadian 
Department of Communications (DOC) Type Acceptance.  The DOC Type 
Acceptance is granted for devices which demonstrate operation 
within performance criteria mandated, observed, and tested by the 
DOC.  To date the ESTeem Models 85, 96C, 98F and 192C have applied 
for and have been granted type acceptance in Canada.  

All ESTeem radio modem products require consumer licensing under 
Part 90 of the FCC Rules and Regulations, which must be applied for 
by the end user of the Company's products.  The Company cannot 
guarantee its customers that they will receive FCC consumer 
licenses in the VHF or UHF frequency spectrum for any particular 
application.  The Company provides information to its customers to 
assist in the application for FCC consumer licenses.

At the time of this filing the Company is unaware of any existing 
or proposed FCC regulation that would have an material adverse 
effect on the Company's operations, but there can be no assurance 
that future FCC regulations will not have materially adverse 
effects on the operations of the Company.

                SOURCE OF SUPPLY AND MANUFACTURING

The Company purchases certain components necessary for the 
production of its products from sole suppliers.  Key components for 
the Company's products are supplied by the Motorola Corporation and 
Toko America Inc., as purchased through a number of distributors.  
The components provided by Motorola and Toko could be replaced or 


<PAGE>
substituted by other products, if it became necessary to do so.  If 
this action became necessary, a material interruption of production 
and/or material cost expenditures involved with locating and 
qualifying replacement components could take place. 

For the new generation of products in development, discussed in 
research and development above, the Company has implemented a 
component configuration with surface mount component technology. 
The Company is not experienced with surface mount component 
technology and has, and expects to in the future, to incur expenses 
related to training of its employees and equipping its facility to 
effectively design, produce, and maintain products containing 
surface mount technology components.

Approximately 10% of the inventory at December 31, 1996 consisted 
of parts that have lead times ranging from 16 to 40 weeks.  Some of 
these parts are maintained at high levels to assure their 
availability to meet expected production requirements, and 
accordingly, account for a significant portion of the inventory 
dollar amount.  Based on past experience with component 
availability, current distributor relationships, and current 
inventory levels, the Company foresees no anticipated shortages of 
materials used in production.

The Company contracts with Manufacturing Services, Inc., in 
Kennewick, Washington, for assembly of the Company's products, 
using material purchased by the Company.  By contracting with 
Manufacturing Services, Inc., the Company is able to avoid staff 
fluctuations associated with staffing its own manufacturing 
operation.  The President of Manufacturing Services, Melvin H. 
Brown, is a Director of the Company.  Management believes all 
prices for services, provided by Manufacturing Services, Inc., were 
as favorable as could be obtained from comparable manufacturing 
services companies. See "Management's Discussion and Analysis of 
Financial Condition and  Results of Operations", and 
"Financial Statements".

                             EMPLOYEES

As of December 31, 1996, the Company employed a staff of 11 persons 
on a full time basis, 2 in marketing, 2 in technical support, 5 in 
engineering/manufacturing, and 2 in Finance and Administration.  
The Company's operations are dependent upon key members of its 
Engineering and Management personnel.  In the event services of 
these key individuals were lost to the Company, an adverse effect 
on the Company's operations may be felt.  The Company employs part-
time labor on an "as needed" basis, usually in 
engineering/manufacturing.  At year end 1996 the Company employed 2 
part-time employees.  None of the Company's employees are 
represented by a labor union and the Company believes it has good 
relations with its employees.

                              ITEM 2. 
                            PROPERTIES

EST does not own any real property, plants, mines, or any other 
materially important physical properties.  The Company's 
administrative offices and laboratories are located in leased 
facilities at 415 N. Quay Street, Kennewick, Washington.  The 
<PAGE>
Company leases its office and laboratory space in a  lease 
agreement with The Port of Kennewick in Kennewick, Washington for 
approximately 6,300 square feet of office and laboratory space.  
The total monthly lease cost is $2,265.83, including a leasehold 
tax of $257.83.  The lease covers a period of three years which 
expires November 30, 1999.  

The Company also owns miscellaneous assets, such as computer 
equipment, laboratory equipment, and furnishings.  The Company does 
not have any real estate holdings, nor investments in real estate. 
The Company maintains insurance in such amounts and covering such 
losses, contingencies and occurrences that the Company deems 
adequate to protect its property.  Insurance coverage includes a 
comprehensive liability policy covering legal liability for bodily 
injury or death of persons, and for property owned by, or under the 
control of the Company, as well as damage to the property of 
others.  The Company maintains key man life insurance protecting 
the Company in the event of the death of its President.  The 
Company also maintains fidelity insurance which provides coverage 
to the Company in the event of employee dishonesty.

                            ITEM 3.  
                       LEGAL PROCEEDINGS

No proceedings are identified to proceedings that involve primarily 
a claim for damages as the amounts involved, exclusive of interest 
and costs, which exceed 10% of the current assets of the Company.  
The Company's Form 8-K/A dated February 9, 1996, as filed with the 
Securities and Exchange Commission, is incorporated herein by 
reference. 

The Company was notified on March 8, 1995 that it was included in a 
class action against Piper Jaffray, the manager of the Company's 
marketable securities fund investment which experienced losses as 
described in Note 13 to the financial statements.  This litigation 
was an amended consolidated class action complaint originally filed 
on October 5, 1994, as Civ. File No. 3-94-587, in the United States 
District Court, District of Minnesota.  In February 1996, the 
Company received the first payments pursuant to the settlement of 
this litigation, and as of December 31, 1996 had received 
settlement payments amounting to a total of $11,288. The Company 
expects to receive periodic settlement payments in 1997 and 1998. 

In a related manner , the Company was notified on January 15, 1996 
of a Notice of Pendancy of Class Action against KPMG Peat Marwick, 
LLP, Civ. File No. 3-94-1073, filed in the United States District 
Court, District of Minnesota.  KPMG Peat Marwick was the auditor 
for the Piper Jaffray managed Institutional Government Income 
Portfolio described above.  The Company has decided to remain part 
of the class action against KPMG Peat Marwick at the present time.

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

The Company did not submit any matters for  shareholder approval 
during the fourth quarter of 1996 fiscal year. 

                                                                    

<PAGE>
                              PART II

                              ITEM 5. 

MARKET INFORMATION FOR COMMON EQUITY AND RELATED STOCKHOLDER     
                              MATTERS

There is no established market for trading the Common Stock of the 
Company.  The Common Stock is not regularly quoted in the automated 
quotation system of a registered securities system or association. 
The Common Stock of the Company is traded on the 
"over-the-counter" market and is listed on the electronic bulletin 
board under the symbol of "ELST".  The following table illustrates 
the average high/low price of the Common Stock for the last two (2) 
fiscal years.  The "over-the-counter" quotations do not reflect 
inter-dealer prices, retail mark-ups, commissions or actual 
transactions.
<TABLE>
<CAPTION>
                                    BID                 ASK
                                    ---                 ---          
                                HIGH    LOW         HIGH    LOW
                                -----   ----        -----  -----
<S>                            <C>      <C>       <C>      <C>
Fiscal year ended
     December 31, 1996
    First Quarter               7/16    11/32        1/2    7/16 
    Second Quarter             15/32     1/4         9/16  15/32 
    Third Quarter               7/16     5/16        9/16  15/32 
    Fourth Quarter             11/32     3/16        3/8    5/16

Fiscal year ended 
     December 31, 1995
    First Quarter               5/16     3/32        3/8   11/32
    Second Quarter              9/32     3/32      11/32    9/32
    Third Quarter              13/32     1/8         1/2    9/32
    Fourth Quarter             13/32     1/8      53/100   15/32
</TABLE>
The above data was compiled from information obtained from the 
National Quotation Bureau, Inc. daily quotation service.

The approximate number of record holders of common stock of the 
Registrant as of January 21, 1996 was 672 persons/entities.

Electronic Systems Technology Inc. has never paid a cash dividend 
and the Board of Directors does not anticipate declaring  cash 
dividends in the foreseeable future.  












<PAGE>
                             ITEM 6.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND    
                    RESULTS OF OPERATIONS

Management's discussion and analysis is intended to be read in 
conjunction the Company's audited financial statements the integral 
notes thereto.   The following statements may be forward looking in 
nature and actual results may differ materially.

RESULTS OF OPERATIONS

GENERAL:  The Company is specializes in the manufacturing and 
development of wireless modem products.  The Company offers a 
product line which provide innovative communication solutions for 
applications not served by existing conventional communication 
systems.  The Company offers its product lines in the growing 
markets for process automation in commercial, industrial, and 
government arenas domestically, as well as internationally.  The 
Company markets its products through direct sales, sales 
representatives, Original Equipment Manufacturers (OEM's), and 
domestic, as well as foreign, resellers.  Operations of the Company 
are sustained solely from revenues received through sales of its 
products and services.   

FISCAL YEAR 1996 vs. FISCAL YEAR 1995

GROSS REVENUES:  Total revenues for the fiscal year 1996 were 
$1,443,549 reflecting a 17% decrease from the $1,731,949 total 
revenues for fiscal year 1995.  The decrease is attributable 
primarily to decreased sales in 1996, of   $1,190,304 as compared 
to 1995 sales of $1,535,071, representing a decrease of 22%. 
Throughout 1996 the Company experienced decreases in sales revenues 
in all of the Company's major customer categories; domestic, 
foreign and U.S. Government (See Note 6 to Financial Statements.)  
Management believes the reduction in sales revenues is a result of 
several factors, primarily, increased competition from other types 
of wireless products in the markets in which the Company competes, 
postponements and/or cancellations of customer projects intended to 
employ the Company's products, and uncertainty in purchase 
decisions on the part potential customers due to delays experienced 
in the release of the Company's new product, the ESTeem 192. 

In 1996, a majority of the Company's domestic sales were for 
Supervisory Control and Data Acquisition (SCADA) applications and 
Industrial Controls applications.  An example of a SCADA system is 
a city's water treatment operation.  An example of an Industrial 
Control system is a manufacturer's remote control crane operation. 
It is Management's opinion that these applications will continue 
to provide the largest portion of the Company's revenues in the 
foreseeable future.  

In 1996, the Company had $222,239 in foreign export sales, 
amounting to 17% of total product and service sales for the year. 
For year end 1995, foreign export sales were $223,800, or 15% of 
total product sales for the year.  It is Management's opinion that 
foreign sales did not follow the same percentage reduction in sales 
as other customer categories due to increased use of the Company's 
products in SCADA projects abroad, as well as relatively large, 
unexpected orders to customers in Mexico, Venezuela and the 
<PAGE>
Philippines.  Management believes reduction in sales to Canada is 
due to lack of large site orders which weighted Canadian sales 
performance in 1995 and 1994.  Management believes that reduced 
sales to former Yugoslavian countries will continue as political 
stability returns to the region and normal infrastructures are 
restored, thereby reducing the need for Company's products.  
Products purchased by foreign customers were used primarily for 
Industrial Control applications, although an increase in the use of 
the Company's products in SCADA projects was noted in 1996.  It is 
Management's opinion foreign sales will continue to be strong in 
the Industrial Control arena. Other than sales through foreign 
distributors, management believes a majority of the Company's 
export sales have been obtained as a result of advertisements in 
INDUSTRIAL & CONTROL SYSTEMS magazine.  The geographic composition 
of the Company's foreign export sales for 1996, and 1995 are shown 
in Note 6 to the Financial Statements.  (See Note 6 to Financial 
Statements.)

In 1996 products purchased by U.S. Government agencies or by U.S. 
Government contractors amounted to $262,326 or 22%, of total 
product sales compared with 1995 levels of $396,567, or 20%, of 
total product sales.  Management believes the comparative decrease 
in U.S. Government sales are the result of the following factors:  
1) postponement of a U.S. Marine Corps (USMC) order that was 
originally expected in the fourth quarter of 1996,  2) lack of 
sales under the Company's CAMS subcontract with the Unisys 
Corporation, and 3) high levels of U.S. Government sales 
experienced in 1995 unusually weighted 1995 performance for 
comparative purposes.  Products purchased by the U.S. Government 
were utilized in three primary applications:  Inventory Control, 
PC/PC (Personal Computer) networking, and Command Control.  The 
major application for EST products is in Command Control 
applications, with Inventory Control second and PC/PC networking 
third.  It is Management's opinion that in the future Command 
Control applications will exceed PC/PC networking applications and 
inventory control applications.  Due to the uncertainty of the 
nature of U.S. Government purchasing in general, and specifically 
the AIT, CAMS, and other programs the Company's products are 
involved in, Management does not base liquidity, profitability, or 
material purchase projections on anticipated sales.  

As of December 31, 1996, the Company had a backlog of $89,065, for 
orders placed late in December.  The majority of these orders were 
shipped within the first week of January, 1997.  The Company 
carries a minimal amount of backlog, if any.  Customers generally 
place orders on an "as needed basis".  Shipment for most of the 
Company's products is generally made within 5 working days after 
receipt of customer orders. 

COST OF SALES:  Cost of Sales, as a percentage of gross sales, for 
the years of 1996 and 1995 was 41% and 39%, respectively.  Cost of 
Sales variations that occur are normally attributed to the type of 
product sold and the size of the order.  Larger orders grant lower 
sales prices, reducing the profit margin.





<PAGE>
INVENTORY:  The Company's year-end inventory values for 1996 and 
1995 were as follows:
                                                 
                                  1996         1995
                                 -------     --------
          Parts                 $260,397     $198,487
          Work in Progress        68,555        --0--
          Finished goods          72,353       98,550                 
                                 -------     --------
          TOTAL                 $401,305     $297,037
                                 =======     ========

The majority of the Company's material purchases are handled with 
scheduled purchase orders.  A scheduled purchase order is an order 
where materials are purchased over a time period negotiated with 
the supplier, generally from 2 months to 12 months.  Shipments are 
made monthly or on an as-needed basis.  By using this method, the 
Company is able to obtain volume discounts on purchases and also 
assure that materials will be available when needed.  Volume 
discounts generally provides cost savings of 25% or more.  If the 
Company's sales are less than anticipated, inventory over-stocking 
can occur.  The Company's objective is to keep inventory levels as 
low as possible to provide maximum cash liquidity, while at the 
same time, meet production and delivery requirements.  The Company 
must also take into consideration that significant portion of EST 
component parts have lead times ranging from 16 to 40 weeks. Based 
on past experience with component availability, current distributor 
relationships, and current inventory levels, the Company foresees 
no anticipated shortages of materials used in production.

For year end 1996, purchases and costs allocated to cost of goods 
sold were $595,119 as compared to $475,691 in 1995.  This increase 
is a primary result of the Company increasing specific and 
specialized inventory stocks for the anticipated production of the 
Company's EST 192 product line.  This is also reflected in the 
increase in inventory value at year end 1996 to $401,305 from 1995 
year end levels of $297,037.

OPERATING EXPENSES:  Operating expenses, prior to allocation of 
expenses to Cost of Sales and Engineering Services, increased in 
1996 to $865,162 from 1995 levels of $839,793.  Material  changes 
in expenses is comprised of the following components:   Advertising 
expenses increased to $54,969 in 1996 from 1995 levels of $50,619 
due to the Company expanding its advertising exposure in 
anticipation of the release of the EST 192 product line, as well as 
increases in fees charged by publishing companies for EST's 
advertising.  Sales commissions decreased from 1995 levels of 
$31,974 to $22,972 in 1996 due to decreased sales to the U.S. 
Government. Depreciation expense on the Company's assets increased 
from 1995 levels of $25,379 to $30,303 in 1996 due to increased 
depreciable assets acquired by the Company for manufacturing and 
research and development use.  Supplies and materials expenses 
increased to $26,060 in 1996, from 1995 levels of $12,383 due to 
increased requirements primarily from research/development 
projects.   Printing expenses decreased from 1995 level of $13,104 
to $10,203 at year end 1996, due mainly to the Company producing an 
increased amount of printed material in house instead of 
subcontracting.  Professional services increased from 1995 levels 
of $46,113 to $77,795 at year end 1996 due to increased amounts 
<PAGE>
paid for engineering services to outside third parties for research 
and development projects for the development of the EST 192 product 
line.  Repair and maintenance expenses increased in 1996 to $13,080 
as compared to $6,992 in 1995, due to increased equipment 
calibration costs, and higher than normal necessary repairs on the 
Company's manufacturing and analysis equipment. 

Salaries increased to $413,920 in 1996, an increase from 1995 
levels of $391,826.  This increase is a result of increases in 
wages and benefits costs, as well as higher accrued vacation 
benefits from a more tenured employee base accruing an increased 
amount of vacation benefits in 1996, as compared with figures for 
1995.  Trade show expenses increased from 1995 levels of $8,688 to 
$17,682 in 1996, due to increased trade show attendance on the part 
of the Company.

The Company did not incur bad debt expense during 1996 as compared 
with the $54,474 recognized for amounts owed to the Company by 
Diversified Engineering for 1995.    

FISCAL YEAR 1995 vs. FISCAL YEAR 1994 RESULTS

Total revenues for fiscal year 1995 were $1,731,949 reflecting a 
29% increase from the $1,340,380 total revenues for fiscal year 
1994.  The increase was attributable primarily to increased sales 
in 1995 of $1,535,071 as compared to 1994 sales of $1,197,720. 
Throughout 1995 the Company experienced increases in both customer 
orders of large quantity, and in total customer orders processed.  
Management felt this trend was due in part to increased advertising 
by the Company, increased awareness of wireless technology options 
by potential buyers of the Company's products, and customer 
referrals from the Company's existing customer base. 

Operating expenses, prior to allocation of expenses to Cost of 
Sales and Engineering Services, increased in 1995 to $839,793 from 
1994 levels of $743,816.  Material  changes in operating expenses 
is comprised of the following components:   Advertising expenses 
increased to $50,619 in 1995 from 1994 levels of $35,848 due to the 
Company expanding its advertising exposure, as well as increases in 
fees charged by publishing companies for EST's advertising.  Sales 
commissions increased from 1994 levels of $17,925 to $31,974 in 
1995 due to increased sales to the U.S. Government. Depreciation 
expense on the Company's assets increased from 1994 levels of 
$21,160 to $25,379 in 1995 due to increased depreciable assets 
acquired by the Company for internal networking, manufacturing, and 
research and development use.  Supplies expenses increased to 
$12,383 in 1995, from 1994 levels of $9,601 due to increased 
requirements resulting from elements such as increases in 
production and research/development projects.   Printing expenses 
increased from 1994 level of $6,750 to $13,104 at year end 1995, 
due mainly to increased demand for customer support and marketing 
related material, such as owners manuals, brochures, and technical 
bulletins, as well as increased shareholder mailings.   
Professional services decreased from 1994 levels of $61,338 to 
$46,113 at year end 1995 due to timing differences in amounts paid 
for engineering services to outside third parties.  In 1994, the 
Company had contracted with Remtron, Inc. for these services, 
whereas in 1995, engineering expertise was not required on 
development projects until late in the year.
<PAGE>
Salaries increased to $391,826 in 1995, an increase from 1994 
levels of $381,243.  This increase is a result of increases in 
wages and benefits costs, as well as higher accrued vacation 
benefits from a more tenured employee base, in comparison with 
figures for 1994.  Trade show expenses decreased from 1994 levels 
of $10,017 to $8,688 in 1995, due to discounts on tradeshow fee 
earned by the Company by being a returning participant at the 
attended tradeshows.

Bad Debt expense was recorded, and Accounts Receivable reduced in 
the amount of $57,204 for 1995 for amounts owed to the Company by 
Diversified Engineering, but were unpaid. There was also a downward 
adjustment to the allowance for doubtful accounts to $1,284 for 
1995 due to the Company's prior history of low accounts write-offs, 
leading to a net bad debt expense of $54,474 for 1995. 

LIQUIDITY AND CAPITAL RESOURCES

At December 31, 1996, the Company's working capital was $1,861,527 
compared with $1,723,823 at December 31, 1995. The increase is 
primarily attributable to the Company's 1996 after-tax profit of 
$158,735.  The Company's operations rely solely on the income 
generated from sales.  The Company's major capital resource 
requirement is for maintaining adequate inventory levels.  Long 
lead times for some of the critical components, ranging from 16 to 
40 weeks, force the Company to maintain higher than normal 
inventory levels.  It is Management's opinion that the Company's 
working capital as of December 31, 1996 is adequate for expected 
resource requirements for the next twelve months. 

The Company's current asset to current liability ratio at December 
31, 1996 was 61.5:1 compared to 13.9:1 at December 31, 1995.  The 
ratio change is attributable primarily to the Company having 
reduced trade accounts payable and the absence of a federal income 
tax liability at year end 1996.  

The Company's cash resources at December 31, 1996, including cash 
in the bank and cash equivalent liquid assets, were $1,413,182, 
reflecting an increase from cash resources of $1,162,726 for year 
end 1995.  Cash flows from operating activities were provided by 
net income of $158,735, a decrease in accounts receivable of 
$119,609, depreciation of $30,303.  Cash flows were primarily 
offset by increases in inventory of $104,268, decreasing federal 
income taxes payable of $58,665, and repurchase of the Company's 
common stock in the amount of $23,981 in 1996. 

Cash and short term investments of the Company changed in holding 
amounts from year end 1995 to year end 1996, with the majority of 
the Company's idle cash being invested in commercial paper short 
term investments, certificates of deposit, and money market 
accounts. These  changes in holding amounts are implemented by the 
Company so that the Company's liquid resources may earn improved 
rates of return.

During 1995 the Company held an investment in marketable securities 
in the Piper Jaffray Institutional Government Fund (the "Fund").  
Public information indicates Piper Jaffray suffered losses due to 
derivatives in is Institutional Government Income Portfolio Mutual 
Fund.  Write downs in the value of the Company's investment in this 
<PAGE>
Fund totaling $49,953 in 1995 were realized due to the other than 
temporary decline in value of the investment, treatment for which 
is outlined in paragraph 16 of Statement of Financial Accounting 
Standard (SFAS) 115.  As of March 31, 1996, the Company had 
liquidated its marketable securities investment in the Fund.
  
The Company's trade accounts receivable, adjusted for uncollectible 
accounts, at December 31, 1996 were $38,311, compared to $157,920 
for 1995.  The decrease is attributable to reduced sales in the 
fourth quarter of 1996 which resulted in reduced amounts of 
receivables owed to the Company.  No bad debt expense was recorded 
during 1996. Bad debt expense was recorded in the amount of $57,204 
for 1995 for amounts owed to the Company by Diversified 
Engineering, which were recovered by the Company during the second 
quarter of 1996. Management believes that all of the Company's 
accounts receivable as of December 31, 1996 are collectible.

Aging of accounts receivable, as of December 31, 1996, is as 
follows:

     Category            Amount      Percentage
   -----------         ----------  --------------
   Current              $15,431             39%  	
   1-30  past            10,041             25%
   31-60 past            10,251             26%
   61-90 past             3,581              9%
   91-120 past            - 0 -           - 0 -
   over 120                 290              1% 

The balances in the past due categories are considered to be at 
normal levels for the Company.  The overall percentages are 
considered skewed by the abnormally low amount of accounts 
receivable at year end 1996.  The Company believes it's level of 
risk associated with customer receipts on export sales is minimal. 
Foreign shipments are made only after payment has been received or 
if irrevocable letter of credit terms have been pre-arranged, or on 
Net 30 terms to foreign offices of domestic companies with which 
the Company has an existing relationship.  Foreign orders are 
generally filled as soon as they are received, therefore, foreign 
exchange rate fluctuations do not impact the Company.

On May 31, 1991, the Corporation received a Promissory Note from 
Western Data Com in the amount of $31,491 to cover it's outstanding 
accounts receivable balance.  The Company had received $30,679 from 
Western Data Com prior to April 25, 1996.  On April 25, 1996, the 
Company received $3,656 from Western Data Com in full settlement of 
the outstanding portion of the Promissory Note.

Inventory levels as of December 31, 1996 were $401,305, an increase 
from December 31, 1995 levels of $297,037. This increase is a 
primary result of the Company increasing specific and specialized 
inventory stocks for the anticipated production of the Company's 
ESTeem 192 product line.  

Outlays for capital expenditures during fiscal year 1996 amounted 
to $26,508.  These expenditures were primarily for equipment used 
for research/development and manufacturing.  The Company intends on 
investing in additional capital equipment as it is deemed necessary 
to support development and/or manufacture of the ESTeem Modem.
<PAGE>
As of December 31, 1996, the Company's current liabilities were 
$30,775, a decrease of $102,817 over the 1995 year end levels of 
$133,592.  The decrease is primarily attributable to the absence of 
federal income tax payable by the Company, and decreases in trade 
accounts payable due to low year end purchasing activity.  All of 
the Company's accounts payable at year end were current.

Differences between the provision for income taxes and income taxes 
computed using the Federal income tax rate, resulted in a deferred 
tax asset of $411 at year end 1996, compared with a $5,287 deferred 
tax asset for year end 1995.  The primary components of the 
deferred tax asset were amounts provided by the Company's accrued 
vacation benefits payable and unused capital loss carryforward 
resulting from the Companies realized loss on impaired marketable 
securities during 1995.

The Company's subcontract administered by UNISYS, dated December 
23, 1993, is a five year indefinite delivery, indefinite 
quantity, fixed price contract through September 1997.  Based on 
the terms of the UNISYS contract, and contracts of this type in 
general, Management does not base liquidity, profitability, or 
material purchase projections on anticipated sales.  The 
Company's economic position allows it to respond to UNISYS orders 
on an as needed basis.  There were no sales by the Company to 
UNISYS under the contract in 1996.  It is Management's opinion 
that sales under the UNISYS contract are impossible to predict 
due to the uncertain nature of U.S. Government purchasing. 
 
The Company's AIT subcontract administered by INTERMEC, dated 
July 26, 1994, is a five year indefinite delivery, indefinite 
quantity, fixed price contract through September 1999.  Based on 
the terms of the AIT contract, and contracts of this type in 
general, Management does not base liquidity, profitability, or 
material purchase projections on anticipated sales.  The 
Company's economic position allows it to respond to AIT orders on 
an as needed basis.  Sales under the AIT contract in 1996 were 
$96,144. It is Management's opinion that sales under the AIT 
contract are impossible to predict due to the uncertain nature of 
U.S. Government purchasing. 

The Company has a General Services Administration (GSA) contract to 
sell goods to the U.S. Government.  This contract is a fixed price, 
indefinite quantity and delivery agreement.  The current contract 
runs through March 31, 1997.  A renewal GSA contract is being 
negotiated.  If awarded the new GSA contract period would extend 
through March 31, 1998.  Management expects its GSA contract to be 
renewed.  Based on previous years activity, the Company expects 
the majority of U.S. Government purchases to be placed under the 
Company's GSA contract. Projections regarding liquidity, 
profitability, and material purchases are based on past history 
of annual purchases. Historically, Federal Government sales have 
averaged approximately 18% of annual sales. Due to the uncertain 
nature of Federal Government purchasing, procurement of material 
and production planning is adjusted quarterly based on demand. It 
is Management's opinion that the majority of Federal Government 
purchases in 1997 will be under this GSA contract. 
 
With the possible exception of orders from the Company's UNISYS, 
AIT, or GSA contracts, and the impact of planned research and 
<PAGE>
development expenditures, Management is unaware of any known 
trend which would reasonably be likely to have a material effect 
on the Company's liquidity, results of operations, or financial 
condition. 

The Company's operations were not adversely effected by inflation 
during 1996.  No adverse affect is anticipated during 1997.

FORWARD LOOKING STATEMENTS:  The above discussion may contain 
forward looking statements that involve a number of risks and 
uncertainties.  In addition to the factors discussed above, among 
other factors that could cause actual results to differ materially 
are the following:  competitive factors such as rival wireless 
architectures and price pressures; availability of third party 
component products at reasonable prices; inventory risks due to 
shifts in market demand and/or price erosion of purchased 
components; change in product mix, and risk factors that are listed 
in the Company's reports and registrations statements filed with 
the Securities and Exchange Commission.

                             ITEM 7. 
                       FINANCIAL STATEMENTS

See Exhibit 1, Financial Statements and Financial Statement 
Schedules.  Such Financial Statements and Schedules are 
incorporated herein by reference.

                             ITEM 8.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND 
                    FINANCIAL DISCLOSURE.

                                                                   
                           			NONE


























<PAGE>
                            PART III

                             ITEM 9. 

   DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;      
        COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

IDENTIFICATION OF DIRECTORS:
 
The following table sets forth the names and ages of all directors 
of the Company as of December 31, 1996;  as well as term in office 
and principal occupation of each director. 

  Name of  Director   Term in Office     Age  Principal  Occupation
  -----------------   --------------     ---  ---------------------
  T.L. Kirchner      06/05/93-06/04/99    48  President of the Company

  Melvin H. Brown    06/04/94-06/06/97    66  President of Manufacturing       
                                                 Services,Inc.

  Arthur Leighton    06/04/94-06/06/97    73  Consultant
                                             
  Robert Southworth  06/04/94-06/06/97    53  Patent Attorney for U.S. 
                                                 Dept. of Energy
                                            
  John H. Rector     06/05/93-06/04/99    80  Consultant
                                              
  John L. Schooley   06/02/95-06/05/98    57  President of Remtron, Inc.

Management believes that there are no agreements or understanding 
between the directors and suppliers or contractors of the Company, 
except the agreement with Manufacturing Services, Inc. as described 
elsewhere in this report.

IDENTIFICATION OF EXECUTIVE OFFICERS

The following table sets forth the names and ages of all executive 
officers of the Company as of December 31, 1996; all positions by 
such persons; term of office and the period during which he has 
served as such; and any arrangement or understanding between him 
and any other person(s) pursuant to which he was elected as an 
officer:

  Name of  Officer    Age     Position    Term of Office Period of Service
  ----------------    ---     --------    -------------- ----------------
  T. L. Kirchner      48     President      3 Years      02/10/84-Present

  Robert Southworth   53     Sec/Treas      3 Years      12/11/92-Present

There are no family relationships, whether by blood, marriage, or 
adoption, between any of the Directors or Executive Officers of the 
Company.

The following is a brief description of the business experience 
during the last five years of each director and/or executive 
officer of the Company.



<PAGE>
T.L. KIRCHNER.  Mr. Kirchner is founder, President and a Director 
of the Company.  During the last five years Mr. Kirchner devoted 
100% of his time to the Management of the Company.  His primary 
duties were to oversee the Management and Marketing functions of 
the Company.  Mr. Kirchner does not serve as a director for any 
company registered under the Securities Exchange Act.

MELVIN H. BROWN.  Mr. Brown is a Director of the Company.  During 
the last five years Mr. Brown has been the owner and president of 
Manufacturing Services, Inc.  Manufacturing Services provides 
services in packaging design, printed circuit board layout, 
prototyping, production runs, verification of documentation 
testing, burn-in, quality control, and repetitive volume 
production.  Manufacturing Services provides electronic 
manufacturing and quality control testing services for Electronic 
Systems Technology.  Mr. Brown does not serve as a director for any 
company registered under the Securities Exchange Act.

ROBERT SOUTHWORTH.  Mr. Southworth is a Director and the 
Secretary/Treasurer of the Company.  Since 1980,  Mr. Southworth 
has been employed with the U. S. Department of Energy as a Senior 
Patent Attorney in Richland, Washington.  His primary duties with 
the Department of Energy include the preparation and prosecution of 
domestic and foreign patent applications in such fields as nuclear 
reactors, fuel reprocessing, waste management and energy related 
fields of solar, wind, and fossil fuels.  Mr. Southworth does not 
serve as a director of any company which is registered under the 
Securities Exchange Act.

ARTHUR LEIGHTON.  Mr. Leighton is a Director of the Company.  Mr. 
Leighton served as President of Kraft Industries through mid 1986. 
Since then he has been working as an independent Management 
Consultant.  Mr. Leighton does not serve as director of any  
company which is registered under the Securities Exchange Act.  See 
also the Company's Form 8-K dated March 3, 1997, incorporated 
herein by reference, describing a shooting incident wherein Mr. 
Leighton was wounded.  As of the date of this Annual Report, the 
Company is unsure of the extent or enormity of Mr. Leighton's 
injuries or the effect on his continued ability to serve as a 
Director for the Company.

JOHN H. RECTOR.  Mr. Rector is a Director of the Company.  Mr. 
Rector founded Western Sintering, located in Richland, Washington. 
Western Sintering, a powdered metal parts manufacturer, is an 
Original Equipment Manufacturer (OEM).  Mr. Rector is the former  
President of Western Sintering, Inc.  Mr. Rector recently retired 
as President of Western Sintering, but is still acting in an 
advisory position to its officers and directors.  Mr. Rector does 
not serve as director of any company which is registered under the 
Securities Exchange Act.

JOHN L. SCHOOLEY.  Mr. Schooley is a Director of the Company.  
During the past five years, Mr. Schooley has been the owner and 
President of Remtron, Inc. in San Diego, California.  Remtron, Inc. 
is a manufacturer of advanced radio control and telemetry systems 
for the industrial market.  Remtron, Inc. has provided research and 
development services for Electronic Systems Technology.  Mr. 
Schooley does not serve as director of any other company which is 
registered under the Securities Act.
<PAGE>
                            ITEM 10.  
                      EXECUTIVE COMPENSATION

The Company's named compensated executive officer is T.L. 
Kirchner, President and CEO.  The Company did not have any compensated
executive officers other than the CEO as of December 31, 1996.                 

The information specified concerning the compensation of the named 
executive officers for each of the Registrant's last three 
completed fiscal years is provided in the following Summary Compensation 
Table:
<TABLE>
<CAPTION>
                  	SUMMARY COMPENSATION TABLE

                                              Long Term Compensation
                       Annual Compensation    Awards         Payouts
   (a)            (b)        (c)       (d)         (e)         (f)        (g)       (h)       (i)
                                                                      Securities     
  Name and                                        Other    Restricted   Options               All
  Principal                                      Annual      Stock     Underlying   LTIP     Other
  Position       Year      Salary     Bonus   Compensation   Awards      SARs     Payouts Compensation 
		                          	($)      ($)(1)	    ($)(2)       ($)         (#)        ($)     ($)(3)
-------------------------------------------------------------------------------------------------------
<S>              <C>       <C>        <C>        <C>           <C>      <C>           <C>    <C>    
T. L. Kirchner   1996      74,015     8,748      1,185         0        25,000        0      5,368    
President &      1995      67,800     5,356      1,406         0        25,000        0      5,025
CEO              1994      67,800     8,103        578         0             0        0      6,368
</TABLE>
(1) Includes amounts paid under the Non-qualified Employee Profit Sharing Bonus
(2) Other Annual Compensation includes Accrued Vacation Pay
(3) All Other Compensation consists of premiums paid for Group 
    Health Insurance and Key Man Insurance

The information specified concerning the stock options of the 
named executive officers during the fiscal year ended December 
31, 1996 is provided in the following Option/SAR Grants in the 
Last Fiscal Year Table:
<TABLE>
<CAPTION>
                      OPTION/SAR GRANTS IN LAST FISCAL YEAR

                    					    Individual Grants (4)               
   (a)              (b)           (c)            (d)                 (e)
                 Number of     % of Total
                 Securities   Options/SARs 
     	           Underlying    Granted to        
                Options/SARs  Employees in  Exercise or base     Expiration
  Name          Granted # (4)  Fiscal Year    Price($/Sh)           Date     
 ---------------------------------------------------------------------------
 <S>              <C>            <C>            <C>                <C>
 T.L. Kirchner    25,000         12.5%          0.42               2/8/99
</TABLE>
	
(4)  This table does not include Stock Options granted previously. 
     Form 8-K dated 2/3/95 and 2/9/96, respectively, are incorporated 
     herein by reference.



<PAGE>
The information specified concerning the stock options of the named 
executive officers during the fiscal year ended December 31, 1996 
is provided in the following Aggregated Option/SAR Exercises in 
Last Fiscal Year and Fiscal Year-End Options/SAR Values Table:
<TABLE>
<CAPTION>
          	AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
                	AND FISCAL YEAR END OPTION/SAR VALUES

   (a)               (b)          (c)            (d)             (e)
                                              Number of                
                                             Securities        Value of 
                                             Underlying      Unexercised
                              					  	  	   Unexercised      in-the-money
                               				  	  		  Options/SARs     Options/SARs
                             						  	      at FY-End (#)    at FY-End ($)
                 Number of            
              Shares Acquired    Value      Exercisable/     Exercisable/
  Name          on Exercise     Realized($) Unexercisable    Unexercisable
---------------------------------------------------------------------------
 <S>                  <C>          <C>        <C>                  <C>
 T.L. Kirchner        0            0          50,000               0
</TABLE>
The Company does not currently have a Long-Term Incentive Plan ("LTIP").

Compensation to outside directors is limited to reimbursement of 
out-of-pocket expenses that are incurred in connection with the 
directors duties associated with the Company's business.  There is 
currently no other compensation arrangements for the Company's 
directors.  (See "Security Ownership of Certain Beneficial Owners 
and Management" for Stock Options granted in previous years.)

The Company currently does not hold any Employment Contracts nor 
Change of Control Arrangements with any parties.

                               ITEM 11.
      SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

The following table sets forth, as of December 31, 1996, the amount 
and percentage of the Common Stock of the Company, which according 
to information supplied by the Company, is beneficially owned by 
each person who, to the best knowledge of the Company, is the 
beneficial owner (as defined below) of more than five (5%) of the 
outstanding common stock.
<TABLE>
<CAPTION>                                                                   
                                             Amount &
                                            Nature of
          Title     Name & Address          Beneficial        Percent
            of           of                    of                of
          Class   Beneficial Owner (1)     Ownership (2)       Class 
      ------------------------------------------------------------------
        <S>        <C>                      <C>                 <C>
        Common     T.L. Kirchner            403,488 (3)         8.1%
                   415 N. Quay Street.
                   Kennewick, WA 99336
</TABLE>
<PAGE>
      ------------------------------------------------------------------

(1)	Under Rule 13d-3, issued by the Securities and Exchange 
Commission, a person is, in general, deemed to "Beneficially 
own" any shares if such person directly or indirectly, through 
any contract, arrangement, understanding, relationship or 
otherwise, has or shares (a) voting power, which includes the 
power to vote or to direct the voting of those shares and/or 
(b) investment power, which included the power to dispose, or 
to direct the disposition of those securities.  The foregoing 
table gives effect to shares deemed beneficially owned under 
Rule 13d-3 based on the information supplied to the Company.  
The persons named in the table have sole voting power and 
investment power with respect to all shares of Common Stock 
beneficially owned by them.

(2)	The beneficial owner listed above has stock options giving the 
right to acquire 50,000 shares of Electronic Systems 
Technology, Inc. Common Stock:  Options for 25,000 shares were 
granted February 3, 1995; Options for 25,000 shares were 
granted February 9, 1996; Options for 25,000 shares were 
granted February 7, 1997 Forms 8-K, dated February 3, 1995, 
February 9, 1996, and February 7, 1997 respectively, are 
incorporated herein by reference.

(3)	Does not include options granted.  See footnote (1) above.

SECURITY OWNERSHIP OF MANAGEMENT

The following table sets forth, as of January 15, 1997, amount and 
percentage of the Common Stock of the Company, which according to 
information supplied by the Company, is beneficially owned by 
Management, including officers and directors of the Company.
<TABLE>
<CAPTION>
      Title          Name           Amount & Nature           Percent
        of            of                  of                    of
      Class    Beneficial Owner    Beneficial Ownership        Class  
    -------------------------------------------------------------------
     <S>        <C>                   <C>                       <C> 
     Common     T.L. Kirchner         403,488 (1)               8.1%
                (Officer & Director)

     Common     Robert Southworth       4,000 (1)               0.1%
                (Officer & Director)

     Common     Melvin H. Brown        76,500 (1)               1.5%
                (Director)          

     Common     Arthur Leighton        84,000 (1)               1.7%
                (Director)

     Common     John H. Rector          6,000                   0.1%
                (Director)

     Common     John L. Schooley       10,000                   0.2%
                (Director)
</TABLE>
(1) Does not include stock options.  See below.
<PAGE>
On various dates, the Company's Board of Directors has approved 
Stock Option Bonuses for Directors and Employees.  The following is 
a summary of the Stock Option bonuses currently outstanding:  
Options are exercisable at fixed prices.  Options may not be 
exercised in blocks of less than 5,000 shares.  Options not 
exercised expire three years after approval date or 90 days 
following termination of employment/board membership, whichever 
occurs first.  In the event of acquisition, merger, 
recapitalization or similar events of the Company, the optionee 
will receive equivalent shares or will have a 10-day window in 
which to exercise the options.  Option grants are not transferable 
or assignable except to the optionee's estate in the event of the 
optionee's death.  The Company's Form 8-K/A, dated February 3, 
1995, and Form 8-K, dated December 10, 1993, are incorporated by 
reference.  The information below does not include stock options 
granted in February 1997, see the Company's Form 8-K dated February 
7, 1997.

Recipients of  Stock Options  currently unexpired as of 12/31/96 
were as follows:
                                                     Exercise Price
      Name                  Option Shares              per Share   
   --------------------------------------------------------------------
                             
  	APPROVAL DATE: 2-9-96
     	David B. Strecker         25,000                   0.42
     	Eric P. Marske            25,000                   0.42
     	Jon A. Correio            25,000	                  0.42
    		Alan B. Cook              25,000      	            0.42	
    		Melvin Brown              25,000                   0.42
      Tom Kirchner              25,000                   0.42
     	Arthur Leighton           25,000                   0.42
     	Robert Southworth         25,000                   0.42

  	APPROVAL DATE: 2-3-95

     	George M. Stoltz          25,000                  $0.31
     	David B. Strecker         25,000                   0.31
     	Eric P. Marske            25,000                   0.31
     	Melvin Brown              25,000                   0.31
      Tom Kirchner              25,000                   0.31
     	Arthur Leighton           25,000                   0.31
     	Robert Southworth         25,000                   0.31

Stock options must be exercised within 90 days after termination of 
employment/board membership.  During 1996, no options were 
exercised and 150,000 options expired.  At December 31, 1996 there 
were 375,000 shares reserved for future exercise.











<PAGE>
                                 ITEM 12. 
              CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

TRANSACTIONS WITH MANAGEMENT AND OTHERS

During fiscal year 1996, the Company contracted for services from 
Manufacturing Services, Inc. in the amount of $52,199.  
Manufacturing Services, Inc. is owned and operated by Melvin H. 
Brown, who is a Director of Electronic Systems Technology, Inc.  
Management believes all prices for services, provided by 
Manufacturing Services, Inc., were as favorable as could be 
obtained from comparable manufacturing services companies.

	













































<PAGE>
                                   PART IV

                                   ITEM 13.
                      EXHIBITS AND REPORTS ON FORM 8-K

Exhibits filed as part of the Company's 10KSB report for 1996 are 
listed below.  Certain exhibits have been previously filed with the 
Securities and Exchange Commission and are incorporated by reference.

 EXHIBIT                                                  
 NUMBER    DESCRIPTION
 -------   -----------
   1.   	Report of Independent Certified Public Accountant
	       	Financial Statements/Financial Statement Schedules 
	       	Balance Sheets
		       Statement of Operations
		       Statement of Changes in Stockholders Equity
	       	Statement of Cash Flows
	       	Notes to Financial Statements

   2.   	Reports on Form 8-K 
         2.1  Form 8-K dated October 7, 1996
         2.2  Form 8-K dated November 19, 1996
         2.3  Form 8-K dated December 6, 1996
         2.4  Form 8-K dated December 9, 1996
         2.5  Form 8-K dated December 10, 1996
		       2.6  Form 8-K dated December 18, 1996

  	3.   	Articles of Incorporation and By-Laws filed as Exhibit 2.1 to Form
         S-18, Registration Statement No.	2-92949-S, Exhibit ( c ) to Form 8-K,
         filed March 15, 1985, and Amendments to By-Laws adopted by Shareholders
         on January 14, 1985 are incorporated herein by reference.

 		4.    Instrument defining the rights of security holders including
         indentures.
    	   	Exhibit II Form S-18 Registration Statement No. 2-92949-S is
         incorporated herein by reference. Forms 8-K dated July 12, 1991,
         December 14, 1992, December 10, 1993, February 9, 1996,
         February 7, 1997, and Form 8-K/A dated February 3, 1995, are
         incorporated herein by reference.
		
 	11.   	Statement regarding computation of per share earnings.          
                                               
 	13.   	Annual report to security holders, Form 10-Q or quarterly  
         report to security holders.                                 N/A

 	22.   	Published report regarding matters submitted to vote of 
         security holders.                                           N/A

  24.   	Consents of experts and counsel               
                                      
  27.   	Financial Data Schedule

  99.   	Additional Exhibits 
         Form 8-K/A dated February 9, 1996, is incorporated herein by reference.
     	  	Form 8-K, dated January 17, 1997, is incorporated herein by reference.
  	     	99.1   Form 8-K, dated March 3, 1997


<PAGE>		    	
                             SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the 
Registrant has caused this Report to be signed on its behalf by the 
undersigned, thereunto duly authorized.

ELECTRONIC SYSTEMS TECHNOLOGY, INC.

By:    /s/ T. L. KIRCHNER 

      T.L. Kirchner, Director/President
      (Principal Executive Officer)

Date:  March 12, 1997

In accordance with the Exchange Act, this Report has been signed 
below by the following persons on behalf of the Registrant and in 
the capacities and on the dates indicated.

  Signature                  Title                      Date
  ---------               -----------------      ---------------

  /s/ T. L. KIRCHNER      Director/President       Mar. 12, 1997
T.L. Kirchner


  /s/ ROBERT SOUTHWORTH   Director/Secretary/      Mar. 12, 1997 
Robert Southworth          Treasurer


  /s/ MELVIN H. BROWN     Director                 Mar. 12, 1997
Melvin H. Brown


                          Director                
Arthur Leighton


  /s/ JOHN H. RECTOR      Director                 Mar. 12, 1997 
John H. Rector


  /s/ JOHN L. SCHOOLEY    Director                 Mar. 12, 1997 
John L. Schooley