UNITED STATES
                   SECURITIES AND EXCHANGE COMMISSIONPRIVATE
                             WASHINGTON, D.C. 20549

                                  FORM 10-QSB


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

                 For the quarterly period ended April 19, 1998

                                       OR

[ ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE ACT
     OF 1934

                  For the transition period from ____ to ____

                        Commission File Number: 33-95796

                         HARVEST RESTAURANT GROUP, INC.
             (Exact name of registrant as specified in its charter)


              Texas                                           76-0406417
(State or other jurisdiction of                              (IRS Employer
incorporation or organization)                               Identification No.)


                         1250 N.E. Loop 410, Suite 335
                            San Antonio, Texas 78209
          (Address of principal executive offices, including zip Code)

                                 (210) 824-2496
                         (Registrant's telephone number)

--------------------------------------------------------------------------------

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

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock as of the latest  practicable date:
                      3,014,030 shares as of May 31, 1998


<PAGE>



                         HARVEST RESTAURANT GROUP, INC.

                                      INDEX





PART I. FINANCIAL INFORMATION                                           PAGE NO.
                                                                        --------

     ITEM 1. Financial Statements

             Consolidated Balance Sheets -
             April 19, 1998 and December 28, 1997                            3

             Consolidated Statements of Operations -
             16 Weeks Ended
             April 19,1998 and April 20, 1997                                4

             Consolidated Statements of Cash Flows -
             16 Weeks Ended
             April 19, 1998 and April 20, 1997                               5


             Notes to Financial Statements                                   6


     ITEM 2. Managements Discussion and Analysis of
             Financial Condition and Results of Operations                   8


PART II. OTHER INFORMATION

         NONE

      SIGNATURES                                                            10


<PAGE>
<TABLE>
<CAPTION>


                            HARVEST RESTAURANT GROUP, INC.
                             Consolidated Balance Sheets


                                                           April 19,      December 28,
                                                             1998            1997
                                                         ------------    -------------
                                                         (Unaudited)
ASSETS
Current Assets
<S>                                                      <C>             <C>         
        Cash                                             $     69,405    $    774,674
        Cash, restricted                                      100,000         300,000
        Inventories                                             3,967          15,345
        Other current assets                                     --            17,400
                                                         ------------    ------------
                Total Current Assets                          173,372       1,107,419

Property and Equipment, net                                 1,902,416       2,039,052

Other Assets
        Intangible property rights, net of accumulated
           amortization of $287,519 in 1998 and
           $237,750 in 1997                                   111,981         161,750
        Deposits                                               49,718          70,978
        Other assets                                           60,389         110,406
                                                         ------------    ------------
                                                              222,088         343,134
                                                         ------------    ------------
                                                         $  2,297,876    $  3,489,605
                                                         ============    ============

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
        Accounts payable, trade                          $    362,077    $    652,817
        Accrued liabilities                                   950,716         956,460
        Current portion of long-term debt                     186,573         211,779
                                                         ------------    ------------
                Total Current Liabilities                   1,499,366       1,821,056

Long-term debt, less current portion                           37,546          41,963

Stockholders Equity
        Preferred stock                                       515,150         515,150
        Common stock - $.01 par value, authorized
           20,000,000, issued 2,774,030 in 1998
           and 2,698,630 in 1997                               27,740          26,986
        Additional paid-in capital                         11,901,319      11,902,073
        Accumulated deficit                               (11,683,245)    (10,817,623)
                                                         ------------    ------------
          Total Stockholders Equity                           760,964       1,626,586
                                                         ------------    ------------
                                                         $  2,297,876    $  3,489,605
                                                         ============    ============



See notes to financial statements (unaudited).

                                          3
</TABLE>

<PAGE>


                         HARVEST RESTAURANT GROUP, INC.
               Consolidated Statements of Operations (Unaudited)




                                                           16 Weeks Ended 
                                                     --------------------------
                                                       April 19,      April 20,
                                                         1998           1997
                                                     -----------    -----------

Revenues                                             $   222,101    $   446,994

Costs and Expenses
        Cost of food and paper                           118,481        230,248
        Salaries and benefits                            107,220        234,685
        Occupancy and related expenses                    46,140         65,012
        Other operating expenses                          78,675        140,219
        Preopening expenses                               42,156         86,314
        General and administrative expenses              534,929        436,505
        Depreciation and amortization                    157,454         60,635
                                                     -----------    -----------
          Total costs and expenses                     1,085,055      1,253,618
                                                     -----------    -----------

Loss from operations                                    (862,954)      (806,624)

Other income (expense)
        Interest income                                    4,736         16,882
        Interest and debt discount expense                (7,404)        (7,816)
                                                     -----------    -----------
                                                          (2,668)         9,066
                                                     -----------    -----------

Net Loss                                             $  (865,622)   $  (797,558)
                                                     ===========    ===========



Preferred stock dividends                               (154,500)          --
Net loss applicable to common stock                   (1,020,122)          --

Basic loss per common share                          $      (.38)   $      (.34)
                                                     ===========    ===========
Basic weighted average common shares outstanding       2,711,353      2,316,279
                                                     ===========    ===========


See notes to financial statements (unaudited).

                                       4

<PAGE>
<TABLE>
<CAPTION>


                               HARVEST RESTAURANT GROUP, INC.
                     Consolidated Statements of Cash Flows (Unaudited)


                                                                        16 Weeks Ended
                                                                  --------------------------
                                                                    April 19,      April 20,
                                                                      1998           1997
                                                                  -----------    -----------
Operating Activities:
<S>                                                               <C>            <C>         
        Net loss for the period                                   $  (865,622)   $  (797,558)
        Adjustments to reconcile net loss
         to net cash used in operating activities:
           Depreciation and amortization                              157,454         60,635
           Write-off of deposits                                       93,678
           Changes in operating assets and liabilities:
                Inventories                                            11,378        (15,125)
                Other current assets                                   17,400        (29,056)
                Accounts payable and accrued expenses                (296,484)       209,651
                                                                  -----------    -----------
                        Net cash (used) in operating activities      (882,196)      (571,453)

Investing Activities:
        Purchase of property and equipment                                          (555,021)
        Additions to deposits                                         (18,450)      (212,522)
        Refunds of deposits                                            25,000           --   
                                                                  -----------    -----------
Net cash (used) in investing activities                                 6,550       (767,543)

Financing Activities:
        Proceeds from sale of common stock and warrants                              568,875
        Proceeds from borrowings                                      173,686           --
        Cash restricted for bank obligations                          200,000         20,000
        Repayments of bank borrowings                                (203,309)        (4,136)
                                                                  -----------    -----------
Net cash provided by financing activities                             170,377        584,739
                                                                  -----------    -----------

Net increase (decrease) in cash                                      (705,269)      (754,257)
Cash at beginning of year                                             774,674      1,271,443
                                                                  -----------    -----------

Cash at end of period                                             $    69,405    $   517,186
                                                                  ===========    ===========



Supplemental disclosure of cash flow information:
          Interest paid                                           $     7,404    $   130,243
                                                                  ===========    ===========
          Federal income taxes paid                               $      --      $      --
                                                                  ===========    ===========



See notes to financial statements (unaudited).

                                             5
</TABLE>

<PAGE>


                         HARVEST RESTAURANT GROUP, INC.
                   Notes to Financial Statements (Unaudited)



NOTE A - ORGANIZATION AND BASIS OF PRESENTATION

Organization

Harvest  Restaurant Group,  Inc.  ("Harvest or the "Company") is an operator and
developer of quick service  restaurant  concepts operated under the name Harvest
Rotisserie  and most recently  Harvest Food Court.  At December 28, 1997,  there
were fourteen Harvest  Rotisserie  restaurants in operation,  consisting of four
company-owned  restaurants and ten franchised restaurants.  In January 1998, the
Company began to  concentrate  its efforts on the  development,  operations  and
franchising of Harvest Food Court  restaurants in Texas. In the first quarter of
1988,  the  Company  significantly  curtailed  its  operations  and  closed  one
company-owned  Harvest  Rotisserie  restaurant and the Companys area  developers
closed  nine  franchised  Harvest  Rotisserie  restaurants.   Subsequently,  two
additional  company-owned  restaurants  have closed and the  Company  opened its
first Harvest Food Court restaurant in May 1998.

Basis of Presentation

The accompanying  unaudited consolidated financial statements have been prepared
by the Company in accordance with the instructions to Form 10-QSB.  Accordingly,
certain  information  and  footnote  disclosures  normally  included  in  annual
financial  statements  prepared in accordance with generally accepted accounting
principles  have been omitted.  In the opinion of  management,  all  adjustments
(consisting of normal recurring accruals and adjustments)  considered  necessary
for a fair  presentation  have been made. The statements are subject to year-end
adjustment.  The consolidated results of operations for the 16 weeks ended April
19, 1998 may not be  indicative  of the results  for the full fiscal  year.  For
further information, refer to the Companys audited financial statements as filed
with the Securities and Exchange  Commission in the Companys Form 10-KSB for the
year ended December 28, 1997.

The accompanying  unaudited consolidated financial statements have been prepared
assuming the Company will continue as a going concern.  The Company has incurred
operating  losses since  inception,  and as of April 19, 1998 had an accumulated
deficit of $11,683,245 and a working capital deficit of $1,325,994. In addition,
the Company lacks the financial  resources to develop additional  restaurants or
maintain its existing  operations.  These factors raise  substantial doubt about
the Companys  ability to continue as a going concern.  In order to continue as a
going concern,  the Company will have to obtain additional funds through debt or
equity offerings to maintain its operations,  pay its existing obligations,  and
fund the development of additional  restaurants and a franchising  program until
profitable  operations are achieved.  The Company  estimates that such financing
will be required to be received  within the next two months or the Company  will
be forced to further curtail or terminate its operations.
                                .
For a further  discussion of the Companys  liquidity  and capital  resources see
Managements  Discussion  and  Analysis  of  Financial  Condition  and Results of
Operations.


                                       6
<PAGE>



NOTE C - FISCAL YEAR

The Company has  adopted a  52/53-week  fiscal year ending on the last Sunday in
December.  The fiscal year is divided into thirteen four-week periods. The first
quarter  consists  of four  periods  and each of the  remaining  three  quarters
consists of three periods,  with the first,  second and third quarters ending 16
weeks, 28 weeks and 40 weeks respectively, into the fiscal year.


NOTE D - CONTINGENCIES

The Company is in default under certain  long-term real estate leases for closed
company-owned  restaurants  and as guarantor  for similar  leases for its closed
franchised  locations.  The Company is also in default as guarantor  for certain
promissory notes and equipment leases  associated with franchised  locations and
has been named as a defendant in four  separate  lawsuits in Florida  seeking to
foreclose on these promissory  notes and a mortgage note. The Company  continues
to negotiate with each of the lessors and lenders in order to obtain  settlement
agreements. The Company has estimated a net real estate disposition liability of
$747,048 as of April 19, 1998 which is included in other accrued liabilities.



                                       7
<PAGE>


ITEM 2. Managements  Discussion and Analysis of Financial  Condition and Results
        of Operations

Forward-looking Statements

Except for the historical information contained herein, the matters set forth in
this  report are  forward-looking  statements  within  the  meaning of the "safe
harbor"  provisions  of the Private  Securities  Litigation  Reform Act of 1995.
These forward-looking statements are subject to risks and uncertainties that may
cause  actual  results to differ  materially.  These  risks are  detailed in the
Company's  various  reports filed with the Securities  and Exchange  Commission.
These  forward-looking  statements speak only as of the date hereof. The Company
disclaims any intent or obligation to update these forward-looking statements.

General

At the end of the Companys  fiscal year on December  28,  1997,  the Company had
fourteen  Harvest  Rotisserie  restaurants  in  operation,  four of  which  were
company-owned  restaurants  and ten operated as  franchised  stores.  In January
1998,  the  Company  began  to  concentrate  its  efforts  on  the  development,
operations  and  franchising  of Harvest Food Court  restaurant  in Texas.  This
decision was made in part due to the trend of declining sales experienced in the
home-meal  segment of the market and  Harvest  Rotisserie  restaurants,  and the
Companys  limited  financial  resources and the lower per unit  development  and
operating costs for a Harvest Food Court restaurant.  Consistent with the change
in strategy,  the Company  streamlined its overhead  structure and significantly
curtailed  its  operations  and  closed  one  company-owned  Harvest  Rotisserie
restaurant and nine franchised Harvest Rotisserie restaurants were closed during
the first quarter of 1998.  Subsequently,  two additional  company-owned Harvest
Rotisserie  restaurants  have  closed and the  Company  intends to close the one
remaining  company-owned Harvest Rotisserie restaurant during the second quarter
of 1998, which would leave only one franchised Harvest Rotisserie  restaurant in
operation. In May 1998, the Company began initial operation of its first Harvest
Food Court restaurant with a second restaurant expected to open in June 1998.


Results of Operations - For the 16-week  period ended April 19, 1998 compared to
the 16-week period ended April 20, 1997.

     Revenues.  Total  revenues for the 16 weeks ended April 19, 1998  decreased
$224,893   or   approximately   50.3%  as  compared  to  same  period  in  1997.
Approximately  30% of the decline  was due to the  closing of one  Company-owned
restaurant  during the period and the  remainder  due to a decline in same store
sales during the period.

     Costs and Expenses. Cost of food and paper was 53.3% of restaurant revenues
for the  16-week  period  ended April 19, 1998 as compared to 51.5% for the same
period in 1997, which were higher than average for both periods.  Food and paper
cost for the first quarter of 1998 was negatively  affected by higher amounts of
wasted food caused by the lower sales volumes.  The high food and paper costs in
the prior period was due to the opening of new  restaurants in the first quarter
of 1997,  which  generally  have higher  costs due to  increased  food usage for
opening promotions and inefficiencies caused by less experience employees.

Salaries,   benefits,   occupancy  and  operating  expenses  include  all  other
restaurant  level operating  expenses,  the major components of which are direct
and indirect  labor,  payroll  taxes and  benefits,  operating  supplies,  rent,
advertising, repairs and maintenance,  utilities, and other occupancy costs. The
combined  total of these expenses was 104%  restaurant  revenues for the 16-week
period ended April 19, 1998, as compared to 98% for the same  comparable  period
in 1997.  Substantial  portions of these costs are fixed or indirectly variable.
These costs were  disproportionate to revenues for both periods due to low sales
volumes.


                                       8
<PAGE>


General and  administrative  expenses  increased  $98,424 or 22% for the 16-week
period ended April 19, 1998 as compared to the same period in 1997. Although the
Company  reduced its  ongoing  general and  administrative  expenses  during the
quarter,  the increase was primarily due to higher  non-recurring legal expenses
incurred in  responding  to  allegations  made by Business  Week  concerning  an
article  which  appeared in December 1997 and for  professional  fees related to
proposed acquisitions,  which offset reductions made in other corporate expenses
during the  period.  In the first  quarter  of 1988,  these  expenses  included:
salaries and benefits (43%);  professional  fees (37%);  travel related expenses
(3%),  advertising  and promotion  (2%);  and other  general and  administrative
expenses (15%).

Preopening  expenses in 1998 relate to lease costs  associated with  maintaining
one leased  site for a future  restaurant,  while  preopening  expenses  in 1997
related primarily to two new restaurants opened during that period.

Depreciation  and  amortization  increased  $96,819 for the 16-week period ended
April 19, 1998 as compared to the same period in 1997.  The  increase was due to
the  additional  restaurants  opened  in 1997 and a  reduction  in the  recovery
periods for some of the Companys assets.

Net Loss.  The Company  incurred a net loss of $865,622  for the 16-week  period
ended April 19, 1998 as  compared to $797,558  for the same period in 1997.  The
increase in net loss was primarily due to  non-recurring  professional  fees and
higher  depreciation and amortization  expenses which offset reductions in other
general and administrative  expenses and improved store operations.  The Company
expects to incur losses in future periods until it generates sufficient revenues
from an expanded base of restaurants to offset ongoing operating,  financing and
expansion  costs.  The Company lacks the funds  necessary to develop  additional
restaurants  and maintain its  operations and requires  additional  financing to
continue as a going concern.



Liquidity and Capital Resources

     Operating Activities. The Company has incurred losses from operations since
inception and as of April 19,1998 has an accumulated  deficit of $11,683,245 and
a working  capital  deficit  of  $1,325,994.  In  addition  the  Company  is not
generating   sufficient   revenues   from  its   operations  to  meet  its  cash
requirements.  These factors raise  substantial doubt about the Companys ability
to continue as a going concern. 

During the first  quarter  of 1998,  the  Company  significantly  curtailed  its
operations  and  streamlined  its overhead  structure.  By the end of the second
quarter  of 1998,  the  company  expects  to have  only one  franchised  Harvest
Rotisserie  restaurant  in  operation  and two Harvest  Food Court  restaurants.
During the first  quarter net cash used in operating  activities  was  $882,196,
related  primarily to general and  administrative  expenses,  most of which were
nonrecurring,  and for reductions in liabilities  during the period. The Company
made no investment in property and equipment during the quarter and is utilizing
renovation  allowances  provided by landlords for a majority of the  development
costs for the first two Harvest Food Courts.  During the first  quarter of 1998,
the  Company  also  borrowed  $173,686  on  a  short-term  basis  secured  by  a
company-owned restaurant property.

     Capital Requirements.  In order to continue as a going concern, the Company
will have to obtain  additional  funds through debt or equity offerings in order
to settle  its  existing  obligations  and fund the  development  of  additional
restaurants and a franchising program until profitable  operations are achieved.
The Company  estimates that such financing must be received  within the next two
months or the  Company  will be forced  to  further  curtail  or  terminate  its
operations.


                                       9
<PAGE>

In May 1998,  the  Company  entered  into a  non-binding  letter of intent for a
merger with TRC  Acquisition  Corp, a twelve year old company  which  operates a
causal  dining  chain of twelve  Tanners  restaurants  in Georgia  and  Alabama.
Tanners features rotisserie chicken,  fresh vegetables,  steaks, ribs and salads
as part of their full menu,  which also  includes  beer and wine. As part of the
merger,  Tanners is considering expanding its restaurants into Texas and opening
two units in San  Antonio  in  locations  currently  owned by the  Company.  The
Company  is  seeking  to raise  approximately  $4 to $6  million  of  additional
financing for the expansion of the Tanners and Harvest Food Court restaurants as
well for  working  capital  purposes.  The  Company  has  already  identified  a
financing  source  that has  given  verbal  indication  they  will  provide  the
necessary financing. Based on the proposed terms, the Company's current Security
holders  would retain  approximately  a 30% interest in the merged  company on a
fully diluted basis after the  completion  of financing.  The  completion of the
merger is  subject  to the  signing of a  definitive  agreement,  closing of the
financing, customary due diligence, and ratification by the shareholders of both
companies.


PART  II - OTHER INFORMATION

     NONE



                                   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.


                                     HARVEST RESTAURANT GROUP, INC.


Date: May 31, 1998                   By: /s/ William J. Gallagher
     --------------                     ----------------------------------------
                                        William J. Gallagher,
                                        Chairman of the Board and Chief
                                        Executive Officer
                                        (Duly Authorized Signatory)



Date: May 31, 1998                   By: /s/ Joseph Fazzone
     --------------                     ----------------------------------------
                                        Joseph Fazzone
                                        Chief Financial Officer  
                                        (Duly Authorized Signatory)


                                       10