UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C.  20549
                       ----------------------------------

                                    FORM 10-Q
     (Mark One)

     [X]   QUARTERLY report pursuant to Section 13 or 15(d) of the
           Securities Exchange Act of 1934

           For the quarterly period ended March 31, 1999

                                       OR

     [ ]   TRANSITION report pursuant to Section 13 or 15(d) of the
           Securities Exchange Act of 1934

            For the transition period from          to
                                            --------    --------
                         Commission file number 0-26420
                                                -------

                       AMBASSADORS INTERNATIONAL, INC.
                       -------------------------------
             (Exact name of registrant as specified in its charter)

                 Delaware                             91-1688605
     -------------------------------              ------------------
     (State or other jurisdiction of               (I.R.S. Employer
     incorporation of organization)               Identification No.)

     Dwight D. Eisenhower Building
        110 South Ferrall Street
           Spokane, Washington                          99202
     -------------------------------              -----------------
          (Address of principal                       (Zip code)
            executive offices)

     Registrant's telephone number, including area code: (509) 534-6200

     Indicate by check mark whether the registrant (1) has filed all reports
     required to be filed by Section 13 or 15(d) of the Securities Exchange
     Act of 1934 during the preceding 12 months (or for such shorter period
     that the registrant was required to file such reports), and (2) has
     been subject to such filing requirements for the past 90 days.  
     Yes  X    No      
         ---      ---

     Indicate number of shares outstanding of each of the issuer's classes
     of common stock, as of the latest practical date:

            Common shares outstanding as of April 30, 1999: 9,652,060
     <PAGE>
     AMBASSADORS INTERNATIONAL, INC.
     FORM 10-Q QUARTERLY REPORT

     Table of Contents



     PART I   FINANCIAL INFORMATION

     Item 1.  Consolidated Financial Statements (unaudited)

                Consolidated Balance Sheets
                Consolidated Statements of Operations
                Consolidated Statements of Comprehensive Loss
                Consolidated Statements of Cash Flows
                Notes to Consolidated Financial Statements

     Item 2.  Management's Discussion and Analysis of Financial
              Condition and Results of Operations


     PART II  OTHER INFORMATION

     Item 6.  Exhibits and Reports on Form 8-K


     SIGNATURES
     <PAGE>
     AMBASSADORS INTERNATIONAL, INC.
     CONSOLIDATED BALANCE SHEETS (UNAUDITED)
     March 31, 1999 and December 31, 1998


                                               March 31,      December 31,
                                               1999           1998
                                               ------------   ------------
                   ASSETS

     Current assets:
       Cash and cash equivalents               $ 57,688,581   $ 55,289,580
       Restricted cash equivalents                  152,000        152,000
       Investments                               49,130,499     37,659,994
       Accounts receivable                        6,130,294      4,371,898
       Prepaid program costs and expenses         8,756,849      4,637,121
       Other assets                                  88,730        159,158
                                               ------------   ------------
           Total current assets                 121,946,953    102,269,751

     Property and equipment, net                  4,497,789      4,199,889
     Other investments                            3,156,806        462,500
     Goodwill, net of $1,532,584 and 
       $1,285,950 of accumulated amortization    20,130,824     20,401,794
     Covenants-not-to-compete, net of
       $423,239 and $370,047 of accumu-
       lated amortization                           251,761        254,953
     Other assets                                   141,717        142,897
                                               ------------   ------------
           Total assets                        $150,125,850   $127,731,784
                                               ============   ============

     The accompanying notes are an integral part of the consolidated
       financial statements.

     <PAGE>
     AMBASSADORS INTERNATIONAL, INC.
     CONSOLIDATED BALANCE SHEETS (UNAUDITED), CONTINUED
     March 31, 1999 and December 31, 1998


                                               March 31,      December 31,
                                               1999           1998
                                               ------------   ------------
     LIABILITIES AND STOCKOLDERS' EQUITY

     Current liabilities:
       Accounts payable                        $  4,561,202   $  2,348,759
       Accrued expenses                           1,252,471        942,047
       Participants' deposits                    40,242,209     15,742,697
       Customer advances                            691,824        744,077
       Note payable, current portion                188,826        185,851
       Foreign currency exchange contracts          461,003        289,322
       Deferred income taxes                        224,500        284,957
                                               ------------   ------------
           Total current liabilities             47,622,035     20,537,710

     Note payable due after one year                136,434        145,243
                                               ------------   ------------
           Total liabilities                     47,758,469     20,682,953
                                               ------------   ------------
     Stockholders' equity:
       Preferred stock, $.01 par value; 
         2,000,000 shares authorized; 
         none issued and outstanding                     --             --
       Common stock, $.01 par value; 
         authorized, 20,000,000 shares;
         issued and outstanding, 9,690,521
         and 9,915,534 shares                        96,905         99,155
       Additional paid-in capital                86,657,036     90,043,060
       Retained earnings                         15,906,498     17,088,888
       Accumulated other comprehensive loss        (293,058)      (182,272)
                                               ------------   ------------
           Total stockholders' equity           102,367,381    107,048,831
                                               ------------   ------------
           Total liabilities and stock-
             holders' equity                   $150,125,850   $127,731,784
                                               ============   ============


     The accompanying notes are an integral part of the consolidated 
       financial statements.
     <PAGE>
     AMBASSADORS INTERNATIONAL, INC.
     CONSOLIDATED STATEMENTS OF OPERATIONS(UNAUDITED)
     for the three months ended March 31, 1999 and 1998


                                                1999          1998
                                                -----------   -----------
     Revenues                                   $ 4,980,000   $ 3,020,714
                                                -----------   -----------
     Operating expenses:
       Selling and tour promotion                 3,942,474     2,745,125
       General and administrative                 4,406,807     2,806,352
                                                -----------   -----------
                                                  8,349,281     5,551,477
                                                -----------   -----------
     Operating loss                              (3,369,281)   (2,530,763)
                                                -----------   -----------
     Other income (expense):
       Interest expense                                (323)       (5,367)
       Interest and dividend income                 954,981       315,372
       Realized and unrealized gain
         (loss) on investments                       (1,251)      162,817
       Other, net                                   594,010           747
                                               ------------   -----------
                                                  1,547,417       473,569
                                                -----------   -----------
     Loss before income taxes                    (1,821,864)   (2,057,194)
     Income tax benefit                             639,474       761,162
                                                -----------   -----------
     Net loss                                   $(1,182,390)  $(1,296,032)
                                                ===========   ===========
     Net loss per share - basic and diluted     $     (0.12)  $     (0.19)
                                                ===========   ===========
     Weighted-average common shares out-
       standing - basic and diluted               9,830,833     6,888,501
                                                ===========   ===========


     The accompanying notes are an integral part of the consolidated
       financial statements.
     <PAGE>
     AMBASSADORS INTERNATIONAL, INC.
     CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
     for the three months ended March 31, 1999 and 1998


                                                1999          1998
                                                -----------   -----------
     Net loss                                   $(1,182,390)  $(1,296,032)

     Unrealized losses on available-for-
       sale investments                            (110,786)           --
                                                -----------   -----------
     Comprehensive loss                         $(1,293,176)  $(1,296,032)
                                                ===========   ===========

     The accompanying notes are an integral part of the consolidated
       financial statements.
     <PAGE>
     AMBASSADORS INTERNATIONAL, INC.
     CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
     for the three months ended March 31, 1999 and 1998


                                                1999          1998
                                                -----------   -----------
     Cash flows from operating activities:
       Net loss                                 $(1,182,390)  $(1,296,032)
       Adjustments to reconcile net loss
         to net cash provided by operating 
         activities:
           Depreciation and amortization            616,762       343,815
           (Gain) loss on investments                 1,251      (162,817)
           Loss on disposal of property and
             equipment                               20,035            --
           Change in assets and liabilities,
             net of effects of purchases of
             subsidiaries:
               Accounts receivable               (1,758,396)      959,819
               Prepaid program costs and 
                expenses                         (4,119,728)   (2,980,567)
               Other assets                          70,428        (4,292)
               Accounts payable and accrued 
                expenses                          2,522,867      (547,395)
               Participants' deposits            24,499,512    16,556,626
               Customer advances                    (52,253)      (88,692)
                                                -----------   -----------
                 Net cash provided by 
                  operating activities           20,618,088    12,780,465
                                                -----------   -----------
     Cash flows from investing activities:
       Purchase of property and equipment          (634,871)     (162,960)
       Purchase of available-for-sale 
         securities                             (17,789,281)           --
       Proceeds from sale of available-for-
         sale securities                          6,317,963
       Purchase of other investments             (2,655,035)           --
       Net cash paid for acquisition of 
         subsidiaries                              (273,607)   (5,375,264)
       Payment for covenant-not-to-compete
         agreement                                  (50,000)      (50,000)
       Change in other assets                         1,180            --
                                                -----------   -----------
                 Net cash used in investing
                  activities                    (15,083,651)   (5,588,224)
                                                -----------   -----------
     <PAGE>
     AMBASSADORS INTERNATIONAL, INC.
     CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED), CONTINUED
     for the three months ended March 31, 1999 and 1998


                                                1999          1998
                                                -----------   -----------
     Cash flows from financing activities:
       Payments on long-term debt               $    (5,834)  $   (48,872)
       Proceeds from exercise of stock
         options                                     62,898        13,751
       Purchase and retirement of common
         stock                                   (3,192,500)           --
                                                -----------   -----------
               Net cash used in financing
                activities                       (3,135,436)      (35,121)
                                                -----------   -----------
     Net increase in cash and cash 
       equivalents                                2,399,001     7,157,120
     Cash and cash equivalents, beginning 
       of period                                 55,289,580    22,870,546
                                                -----------   -----------
     Cash and cash equivalents, end of 
       period                                   $57,688,581   $30,027,666
                                                ===========   ===========

     Noncash investing and financing 
       activities:
         Estimated market value of common 
          shares issued for acquisition of 
          subsidiaries                          $        --   $ 3,443,438


     The accompanying notes are an integral part of the consolidated
       financial statements.
     <PAGE>
     AMBASSADORS INTERNATIONAL, INC.
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     1.  BASIS OF PRESENTATION

         The consolidated financial statements included herein have been
         prepared by Ambassadors International, Inc. (the Company), without
         audit, pursuant to the rules and regulations of the Securities and
         Exchange Commission.  Certain information and footnote
         disclosures, normally included in financial statements prepared in
         accordance with generally accepted accounting principles, have
         been condensed or omitted as permitted by such rules and
         regulations.  The Company believes the disclosures included herein
         are adequate; however, these consolidated statements should be
         read in conjunction with the financial statements and the notes
         thereto for the year ended December 31, 1998 previously filed with
         the Securities and Exchange Commission on Form 10-K.

         In the opinion of management, these unaudited, consolidated
         financial statements contain all of the adjustments (normal and
         recurring in nature) necessary to present fairly the consolidated
         financial position of the Company at March 31, 1999 and the
         consolidated results of operations, comprehensive loss and cash
         flows for the three-month periods ended March 31, 1999 and 1998. 
         The results of operations for the periods presented may not be
         indicative of those which may be expected for the full year.


     2.  PRINCIPLES OF CONSOLIDATION

         The Company was founded in 1967 and was reincorporated in Delaware
         in 1995.  The Company's Education Group represented the entire
         operations of the Company until 1996 when the Performance Group
         commenced operations.

         The consolidated financial statements include the accounts of
         Ambassadors International, Inc. (the Company) and its
         subsidiaries.  All significant intercompany accounts and
         transactions are eliminated in consolidation.


     3.  INCOME TAXES

         For the three months ended March 31, 1999 and 1998, the Company
         recorded an income tax benefit of approximately $639,000 and
         $761,000, respectively, to reflect the benefit of the net
         operating loss at the estimated effective income tax rate.  
     <PAGE>
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

     4.  LOSS PER SHARE:

         Net loss per share - basic is computed by dividing net loss by the
         weighted-average number of common shares outstanding during the
         period.  Net loss per share - diluted is computed by increasing
         the weighted-average number of common shares outstanding by the
         additional common shares that would have been outstanding if the
         dilutive potential common shares had been issued.

         The following table presents a reconciliation of basic and diluted
         earnings per share (EPS) computations and the number of dilutive
         securities (stock options) that were not included in the dilutive
         EPS computation because they were antidilutive.

                                                 March 31,
                                                 -------------------------
                                                 1999          1998
                                                 -----------   -----------
           Numerator:
             Net loss for basic and diluted
               earnings per share                $(1,182,390)  $(1,296,032)
                                                 ===========   ===========
           Denominator:
             Weighted-average shares outstanding -
               basic                               9,830,833     6,888,501
             Effect of dilutive common stock
               options                                   (A)           (A)
                                                 -----------   -----------
             Weighted-average shares outstanding -
               diluted                             9,830,833     6,888,501
                                                 ===========   ===========
           Net loss per share - basic and 
             diluted                             $     (0.12)  $     (0.19)
                                                 ===========   ===========

           (A) For the three months ended March 31, 1999 and 1998,
               respectively, the effects of 111,388 and 224,859 stock
               options have been excluded from the calculation of diluted
               loss per share because their effects would be anti-dilutive.


     5.  BUSINESS SEGMENTS:

         The Company operates the Education Group segment and the
         Performance Group segment.  Corporate and other consists of
         general corporate and other activities which are not directly
         related to the Education or Performance Groups.  Selected
         financial information related to these segments is as follows:
     <PAGE>
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED

     5.  BUSINESS SEGMENTS, CONTINUED:

     <TABLE>
     <CAPTION>

                                         Education      Performance    Corporate
                                         Group          Group          and Other      Total
                                          ----------    -----------    -----------    ----------
           <S>                           <C>            <C>            <C>            <C>
             March 31, 1999
             -------------------
             Revenue                     $   259,160    $ 4,698,814    $    22,026    $ 4,980,000
                                         ===========    ===========    ===========    ===========
             Operating income (loss)     $(2,935,821)   $   309,238    $  (742,698)   $(3,369,281)
                                         ===========    ===========    ===========    ===========
             March 31, 1998
             -------------------
             Revenue                     $   801,556    $ 2,219,158    $        --    $ 3,020,714
                                         ===========    ===========    ===========    ===========
             Operating income (loss)     $(1,985,697)   $    15,249    $  (560,315)   $(2,530,763)
                                         ===========    ===========    ===========    ===========
      </TABLE>
      <PAGE>
      Item 2.  Management's Discussion and Analysis of Financial
              Condition and Results of Operations

     This Quarterly Report on Form 10-Q contains forward-looking
     statements.  A forward-looking statement may contain words such as
     "will continue to be," "will be," "continue to," "expect to,"
     "anticipates that," "to be" or "can impact." Management cautions that
     forward-looking statements are subject to risks and uncertainties that
     could cause the Company's actual results to differ materially from
     those projected in forward-looking statements.

     COMPARISON OF THREE MONTHS ENDED MARCH 31, 1999 TO THE THREE MONTHS
     ENDED MARCH 31, 1998

     In 1998, the Company acquired five companies.  In February 1998,
     Ambassadors Performance Group (APG or the Performance Group) acquired
     certain of the assets of Rogal America Co. and also merged with Travel
     Incentives, Inc.  APG and Incentive Associates, Inc. merged in April
     1998, and APG also acquired the assets of Destination, Inc. in July
     1998.  All of these acquisitions were included in the Performance
     Group's results of operations as of their respective dates of
     acquisition.

     In May 1998, Ambassadors Specialty Group acquired the assets of
     International Golf Safaris and included the acquisition in the
     Company's results of operations as of the date of acquisition.

     GROSS PROGRAM RECEIPTS
     ----------------------
     Gross program receipts increased to $16.5 million in the first quarter
     of 1999 from $9.4 million in the first quarter of 1998.  This $7.1
     million increase is the result of a number of acquisitions the
     Performance Group made in 1998.  This resulted in a number of new
     customers and programs, which lead to this higher volume of sales.

     NET REVENUE
     -----------
     Net revenue increased to $5.0 million in the first quarter of 1999
     from $3.0 million in 1998.  This $2.0 million increase is due to the
     effect of increased programs and revenue from the Company's
     acquisitions during 1998, combined with maintaining consistently
     strong gross margins of 30% of net revenues.

     SELLING AND TOUR PROMOTION EXPENSES
     -----------------------------------
     The Company's policy is to expense all selling and tour promotion
     costs as they are incurred.

     Selling and tour promotion expenses increased to $3.9 million in the
     quarter ended March 31, 1999 from $2.7 million in the comparable
     quarter of 1998.  This increase is the result of the 1998 acquisitions
     and the assumption of the marketing and selling expenses of those
     companies to support an increased customer and revenue base.
     <PAGE>
     GENERAL AND ADMINISTRATIVE EXPENSES
     -----------------------------------
     General and administrative expenses increased to $4.4 million in the
     first quarter of 1999 from $2.8 million during the quarter ended
     March 31, 1998.  This increase is primarily due to the acquisitions in 
     1998 and the assumption of the related general and administrative
     expenses associated with supporting an increased number of programs.

     OTHER INCOME/EXPENSE
     --------------------
     Other income in 1999 consisted primarily of interest income generated
     by cash and cash equivalents.  As of March 31, 1999, the Company had
     $106.8 million in cash, cash equivalents and short term investments. 
     These interest earning assets are primarily attributable to the
     Company's secondary offering of common stock in April 1998, in which
     the Company realized net proceeds of $70.3 million.  As a result, the
     Company realized interest income of $0.9 million in the first quarter
     of 1999, compared to $0.3 million in the comparable quarter of 1998,
     an increase of $0.6 million.

     Other income also included unrealized foreign currency gains or losses
     during 1998.  The Company enters into forward foreign exchange
     contracts and foreign currency option contracts to offset certain
     operational exposures from changes in foreign currency exchange rates. 
     These foreign exchange contracts and options are entered into to
     support normal recurring purchases, and accordingly are not entered
     into for speculative purposes.  Forward foreign exchange contracts are
     utilized to manage the risk associated with currency fluctuations on
     certain purchase commitments.  Beginning July 1, 1998, the Company
     adopted the provisions of Statement of Financial Accounting Standards
     No. 133 (SFAS 133), "Accounting for Derivative Instruments and Hedging
     Activities."  Therefore, the effective portion of any unrealized gains
     or losses on foreign exchange contracts are no longer recorded in
     other income, but are recorded as other comprehensive income and are
     accumulated as a component of stockholders' equity.  Realized gains
     and losses on these contracts are recorded as a cost of the related
     travel program when the contracts mature and are utilized.  Prior to
     July 1, 1998, all unrealized gains and losses on foreign exchange
     contracts and options were recorded in the statement of operations as
     other income or expense.

     In the first quarter of 1999, the Company purchased a minority
     interest in connection with the acquisition by a group of investors of
     all of the capital stock of Scheduled Airlines Traffic Offices, Inc. 
     The Company received a consulting fee related to this transaction. 
     The Company also entered into a management agreement as part of this
     purchase, whereby the Company receives quarterly management consulting
     fees.  The consulting fee and quarterly management consulting fee have
     been included in other income.
     <PAGE>
     INCOME TAXES
     ------------
     The Company has recorded an income tax benefit of approximately $0.6
     million for the quarter ended March 31, 1999 in comparison to a $0.8
     million tax benefit for the quarter ended March 31, 1998.  Income tax
     benefits have been recorded based upon the estimated effective income
     tax rate applied to the pre-tax loss.

     SEASONALITY
     -----------
     Due to the seasonality of Ambassadors Education Group's (AEG's or the
     Education Group's) business, the first quarter of the fiscal year has
     significantly fewer programs traveling than the other quarters of the
     year.  Thus, the Company budgeted and incurred a net loss of
     approximately $1.2 million or $0.12 per share in the first quarter of
     1999 compared to a $1.3 million net loss or $0.19 per share in the
     comparable 1998 quarter.

     LIQUIDITY AND CAPITAL RESOURCES
     -------------------------------
     The Company's business is not capital intensive.  However, the Company
     does retain funds for operating purposes in order to conduct sales and
     marketing efforts for future programs and to facilitate acquisitions
     of other companies.

     Net cash provided by operations for the quarters ended March 31, 1999
     and 1998 was approximately $20.6 million and $12.8 million,
     respectively.  The increase in operating cash flows from 1998 to 1999
     can be attributed to the advanced timing and increased volume of cash
     receipts from Education Group participants and the increase in program
     participation from companies which the Performance Group acquired in
     1998.

     Net cash used in investing activities for the quarters ended March 31,
     1999 and 1998 was $15.1 million and $5.6 million, respectively.  The
     net cash used in investing activities increased in 1999 primarily due
     to the net increase in investments.  The Company does not have any
     material capital expenditure commitments for 1999.  However, the terms
     of the Company's acquisitions of certain businesses include contingent
     consideration.  Additionally, the Company is continuing to pursue
     further acquisitions of related travel and performance improvement
     businesses that may require the use of cash and cash equivalents.  No
     such acquisitions are currently pending and no assurance can be given
     that definitive agreements for any such acquisitions will be entered
     into, or, if they are entered into, that they will be on terms
     favorable to the Company.

     The Company has a credit facility available with Seafirst Bank, with a
     current limit of up to $50.0 million for foreign currency purchases
     and forward contracts.  This credit facility is renewable annually.
     <PAGE>
     In November 1998, the Board of Directors of the Company authorized the
     repurchase of the Company's common stock (up to an approved amount) in
     the open market or through private transactions.  This repurchase
     program is ongoing.  The Company does not believe that any such
     repurchases will have a significant impact on the Company's liquidity.

     At March 31, 1999, the Company had approximately $57.7 million of cash
     and cash equivalents, including program participant funds of $40.2
     million.  Under the Company's cancellation policy, a program
     participant may be entitled to a refund of a portion of his or her
     deposit, less certain fees, depending on the time of cancellation. 
     Management believes that existing cash and cash equivalents and cash
     flows from operations will be sufficient to fund the Company's
     anticipated operating needs, capital expenditures, stock repurchases
     and acquisitions at least for the ensuing year.

     FOREIGN CURRENCY; HEDGING POLICY
     ---------------------------------
     The substantial majority of the Company's travel programs take place
     outside the United States and most foreign suppliers require payment
     in currency other than the U.S. dollar.  Accordingly, the Company is
     exposed to foreign currency risk relative to changes in foreign
     currency exchange rates between those currencies and the U.S. dollar.
     The Company has a program to provide a hedge against certain of these
     foreign currency risks.  The Company uses forward contracts which
     allow the Company to acquire the foreign currency at a fixed price for
     a specified period of time.  Additionally, the Company uses foreign
     currency call options which provide the Company with the option to
     acquire certain foreign currencies at a fixed exchange rate and time
     period.  Concurrently with the purchase of a foreign currency call
     option, the Company sells a foreign currency put option to minimize
     the net premium paid for the call option.  The strike prices on these
     options generally straddle the exchange rate at the time the options
     are purchased.  The Company also purchases futures contracts to
     similarly hedge its foreign currency risk.  The Company is exposed to
     credit risk under the foreign currency contracts and options to the
     extent that the counterparty is unable to perform under the agreement.
     The fair value of foreign currency exchange contracts is based on
     quoted market prices and the spot rate of the foreign currencies
     subject to contracts at year end.  The fair value of the foreign
     currency options is based on the estimated amount to terminate the put
     and call contracts with the counterparties at period end.

     YEAR 2000 COMPLIANCE
     --------------------
     The Company has a comprehensive Year 2000 project designed to identify
     and assess the risks associated with its information systems,
     products, operations and infrastructure, suppliers, and customers that
     are not Year 2000 compliant, and to develop, implement, and test
     remediation and contingency plans to mitigate these risks.  The
     project comprises four phases: (1) identification of risks, (2)
     assessment of risks, (3) development of remediation and contingency
     <PAGE>
     plans, and (4) implementation and testing.  The Company's Year 2000
     project is currently in the development of remediation and remediation
     phases.  The Company has been storing years as a four-digit field in
     all mission critical databases since 1995 and believes that its
     internal master records are Year 2000 compliant.  Most of the software
     which the Company uses, including all of its finance software, has
     been certified as Year 2000 compliant.  In addition, the Company is in
     the process of obtaining Year 2000 compliance statements from the
     manufacturers of the Company's hardware and software products.  These
     compliance statements are expected to be obtained by September 1999. 
     AEG's internally generated client databases are Year 2000 compliant. 

     APG's hardware, operating systems, applications software and
     internally-generated data requires additional assessment and
     remediation for Year 2000 compliance.  The assessment phase has been
     completed.  It is expected that APG's remediation efforts will be
     greater than those required by AEG, including the replacement of
     certain APG hardware,operating system upgrades and a small amount of
     applications software upgrades.  This remediation is expected to be
     completed by June 1999.  The Company's voicemail software is not Year
     2000 complaint.  The Company intends to upgrade this software to a
     Year 2000 compliant version by the end of 1999.  The cost of this
     upgrade is not expected to be material.

     The Company believes that its greatest potential risks are associated
     with (i) its information systems and systems embedded in its
     operations and infrastructure; and (ii) its reliance on Year 2000
     compliance by the Company's vendors and suppliers.  The Company is at
     the beginning stage of assessments for its operations and
     infrastructure and cannot predict whether significant problems will be
     identified.  The Company is asking its vendors and suppliers to
     complete a Year 2000 survey by the end of May 1999, to assess the
     status of their compliance in order to assess the effect it could have
     on the Company.  The Company has not yet determined the full extent of
     contingency planning that may be required.  Based on the status of the
     assessments made and remediation plans developed to date, the Company
     is not in a position to state the total costs of remediation of all
     Year 2000 issues.  Costs identified to date have not been material. 
     The Company does not currently expect costs to be material, and it
     expects to be able to fund the total costs through operating cash
     flows.  However, the Company has not yet completed its assessments,
     developed remediation for all problems, developed any contingency
     plans, or completely implemented or tested any of its remediation
     plans.

     Based on the Company's current analysis and assessment of the state of
     its Year 2000 compliance, the Company's reasonably likely worst case
     scenario involves booking delays of AEG and APG programs that would
     take place later in 2000, and the more remote possibility of travel
     interruptions for a small number of adult program participants
     actually travelling on AEG millennium programs on and immediately
     <PAGE>
     after January 1, 2000.  Both of these types of delays and
     interruptions would arise as a result of third-party Year 2000
     noncompliance (e.g., computerized airline and hotel booking systems),
     rather than because of the Company's internal Year 2000 compliance.

     As the Year 2000 project continues, the Company may discover
     additional Year 2000 problems, may not be able to develop, implement,
     or test remediation or contingency plans, or may find that the costs
     of these activities exceed current expectations and become material. 
     In many cases, the Company is relying on assurances from suppliers
     that new and upgraded information systems and other products will be
     Year 2000 compliant.  The Company plans to test such third-party
     products by June 30, 1999, but cannot be sure that its tests will be
     adequate or that, if problems are identified, they will be addressed
     in a timely and satisfactory way.  Because the Company uses a variety
     of informational systems and has additional systems embedded in its
     operations and infrastructure, the Company cannot be sure that all of
     its systems will work together in a Year 2000 compliant fashion. 
     Furthermore, the Company cannot be sure that it will not suffer
     business interruptions, either because of its own Year 2000 problems
     or those of its customers or suppliers whose Year 2000 problems may
     make it difficult or impossible for them to fulfill their commitments
     to the Company.  If the Company fails to satisfactorily resolve the
     Year 2000 issues related to its products in a timely manner, it could
     be exposed to liability to third parties.  The Company is continuing
     to evaluate Year 2000-related risks and will take such further
     corrective actions as may be required. 


     PART II - OTHER INFORMATION

     Items 1, 2, 3, 4 and 5 are not presented as they are not applicable.

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

             (a)  Exhibits: 27 - Financial Data Schedule

             (b)  Reports on Form 8-K:

                  No reports on Form 8-K were filed for the three months
                  ended March 31, 1999.
     <PAGE>
     SIGNATURES


     Pursuant to the requirements of the Securities Exchange Act of 1934,
     the registrant has duly caused this report to be signed on its behalf
     by the undersigned thereunto duly authorized.


     AMBASSADORS INTERNATIONAL, INC.


     Date:  May 14, 1999  By: /s/Jeffrey D. Thomas
                                ------------------------------------
                                Jeffrey D. Thomas, 
                                Chief Financial Officer
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