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                                                                      EXHIBIT 11

                 MECHANICAL DYNAMICS, INC. AND SUBSIDIARIES
               STATEMENT RE COMPUTATION OF PER SHARE EARNINGS
                                 (UNAUDITED)

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                                                               THREE MONTHS ENDED                      SIX MONTHS ENDED  
                                                                   JUNE 30,                               JUNE 30,   
                                                      --------------------------------          ----------------------------
in thousands except share and per share data             1997                  1996               1997               1996       
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<S>                                                   <C>                   <C>                 <C>               <C>
PRIMARY EARNINGS PER SHARE:                                                                             
  Net income                                          $      589            $      561          $   1,066         $      932    

  Weighted average common shares outstanding           5,770,681             4,642,704          5,765,558          4,226,384    
  Effect of stock options and warrants                    58,097                86,513            111,559             68,601    
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    Adjusted share outstanding                         5,828,778             4,729,217          5,877,117          4,294,985    
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  Net income per common share                              $0.10                 $0.12              $0.18              $0.22    
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FULLY DILUTED EARNINGS PER SHARE:                                                                               
  Net income                                          $      589            $      561         $    1,066         $      932    

  Weighted average common shares outstanding           5,770,681             4,642,704          5,765,558          4,226,384    
  Effect of stock options and warrants                   111,559               103,544            111,559            103,544    
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    Adjusted share outstanding                         5,882,240             4,746,248          5,877,117          4,329,928    
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  Net income per common share                              $0.10                 $0.12              $0.18              $0.22    
============================================================================================================================

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