SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C.  20549

                                 FORM 10-K

[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
       EXCHANGE ACT OF 1934 
                For the fiscal year ended December 31, 1997

[ ]  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 1-4438

                           O'SULLIVAN CORPORATION
           (Exact name of registrant as specified in its charter)

         Virginia                                     54-0463029
 (State or other jurisdiction                      (I.R.S. Employer
of incorporation or organization)                 Identification No.)
		
      1944 Valley Avenue
      PO Box 3510
      Winchester, Virginia                                22601
(Address of principal executive offices)                (Zip Code)
                                  540-667-6666
           (Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
                                                 Name of each exchange on
       Title of each class                           which registered
   Common stock - par value $ 1                   American Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:  None

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 by check mark if disclosure of delinquent filers pursuant to Item
405 of regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.     [ ]

The aggregate market value of the voting stock held by non-affiliates of the
Registrant on March 9, 1998 (based on the last sale price on the American
Stock Exchange as of such date) was $141,686,478.

The number of shares of the registrant's Common Stock, Par Value $ 1,
outstanding as of March 9, 1998 was 15,742,942.

DOCUMENTS INCORPORATED BY REFERENCE
Portions of the definitive Proxy Statement for the Annual Meeting of
Stockholders on April 29, 1998 are incorporated by reference into Part III.
                                      1
                                   PART I

Item 1.        BUSINESS

O'Sullivan Corporation ("O'Sullivan" or the "Corporation") is a Virginia
corporation originally organized in 1896 as O'Sullivan Rubber Company.  In
1932 the Corporation was moved to Winchester, Virginia.  In 1970 the
corporate name was changed from O'Sullivan Rubber Corporation to O'Sullivan
Corporation to acknowledge the increasing importance of plastics
manufacturing to the Corporation's operations.

Subsequent to the Corporation's name change and through the early 1990's,
the Corporation concentrated on expansion of its plastics manufacturing
operations, both calendering and injection-molding.  The expansion was
accomplished by adding additional capacity within the Corporation and the
acquisition or creation of several subsidiaries to gain facilities in other
regions of the United States.  In 1986, the Corporation divested itself of
its rubber operations.

In 1994, the Corporation sold the injection-molding operations portion of
its plastics products segment.  The sale involved primarily the inventories
and  fixed assets of the Corporation associated with injection-molding
operations and the stock of a subsidiary corporation also involved in
injection-molding operations.  The sale was for approximately $50 million
net of certain liabilities assumed by the purchaser.   

In 1992, the Corporation created a subsidiary, Melnor Inc. ("Melnor"), to
acquire substantially all the assets of a corporation engaged in the water
sprinkler and lawn and garden business.  In July, 1997, the Corporation sold
this business.  The sale involved substantially all assets of the business,
including the stock of Melnor Inc.'s Canadian subsidiary.  The sale was for
approximately $22.0 million which included $2.5 million designated for an
escrow account.  Part or all of this escrow may be returned to the purchaser
of the business in the event future business operations do not meet certain
thresholds.  The disposal of this business has been treated as a discontinued
operation in the accompanying financial statements.

The Corporation's activities are now conducted in a single business segment:
calendered plastics products which manufactures calendered plastics products
for the automotive and specialty plastics manufacturing industries.  


PLASTICS PRODUCTS BUSINESS

The Corporation's Plastics Products business manufactures calendered plastics
products for the automotive and specialty plastics manufacturing industries. 
Calendered plastics products manufactured include vinyl sheeting for
vehicular dashboard pads, swimming pool liners and covers, notebook binders,
luggage, upholstered furniture, golf bags, floor tile, pond liners,
protective clothing, mine curtains, boat and automobile windows and medical
grade materials.  The Plastics Products business products are sold in markets
in which there is competition from many plastic manufacturers, both domestic
and foreign.   While no single competitor offers all of the products produced
by this segment, there are many competitors for any single product.  Major
competitors include; Borden, Inc., Canadian General Tower, Ellay, Gencorp
Inc., Haartz, Nanya Plastics Corporation and Uniroyal Engineered Products.  


                                       2
Distribution of the segment's products is by direct sales to other
manufacturers.

The normal production backlog of the Plastic Products business is
approximately thirty to forty-five days.  The Corporation has various
long-term contracts totaling several million dollars applicable to this
segment, but such contracts are not considered as firm orders until
production releases are received from customers.  The business of the segment
is not seasonal.

All essential raw materials are readily available to the Plastics Products
business.  For critical raw materials, secondary sources of supply are
available if required.  Major suppliers of raw materials to this segment
include the following companies; The Geon Company, General Electric Plastics,
Aristech Chemicals, Witco Corporation, Penn Colors and Toray Plastics.

The Corporation possesses significant technology in the compounding,
formulation and manufacture of its products.

A significant customer of the Corporation accounting for ten percent or more
of the 1997 sales of the business was Ford Motor Company.

GENERAL

The Corporation anticipates no material effects on the capital expenditures,
earnings or competitive position of the Corporation's businesses from the
enactment or adoption of federal, state or local environmental regulations.
The Corporation has several ongoing environmental programs, including
recycling, waste reduction and  environmental audits.  The Corporation also
has proactive dialogues with federal and state environmental agencies to
insure continuing compliance with environmental regulations. 

The Corporation and its Subsidiaries currently have approximately 900
employees.

The Corporation and its Subsidiaries are not engaged in any material
transactions with customers or suppliers located outside North America.


Item 2.        PROPERTIES

The Corporation owns approximately 623,000 square feet of manufacturing,
warehouse and office space on approximately 113 acres in Winchester,
Virginia; 76,000 square feet of manufacturing, warehouse and office space on
approximately six acres in Lebanon, Pennsylvania; 110,000 square feet of
manufacturing and warehouse space on approximately five acres in Newton
Upper Falls, Massachusetts; and 85,000 square feet of manufacturing and
warehouse space on approximately thirteen acres in Yerington, Nevada.  

The Corporation leases 29,250 square feet of warehouse space in St. Louis,
Missouri and 10,000 square feet of warehouse space in Yerington, Nevada.  The
Corporation also leases space for sales offices located in Chicago, Illinois
and Bloomfield Hills, Michigan.

Management of the Corporation believes that unused capacity existed in the
Corporation's operations during 1997.  Percentage utilization of the
Corporation's facilities is difficult to accurately measure due to the
Corporation's policy of adding facilities as required by business conditions.
                                      3
Item 3.        LEGAL PROCEEDINGS

The Corporation and its Subsidiaries are involved in legal proceedings
incidental to their normal business activities.  While the outcome of these
proceedings cannot be completely predicted, the Corporation does not believe
the ultimate resolution of any existing matters will have a material adverse
effect on its financial position or results of operations. 


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

No matters were voted upon during the fourth quarter of 1997.














































                                      4 
                                   PART II


Item 5.        MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED
                   SHAREHOLDER MATTERS

The principal market in which the Corporation's common stock is traded is the
American Stock Exchange.  The stock is traded under the symbol OSL.

The quarterly price range of common stock and the quarterly dividends per
share for 1997 and 1996 are included as part of Note 15 of "Notes to
Consolidated Financial Statements" included elsewhere in this Form 10-K.

At December 31, 1997 the number of owners of the Corporation's common stock
was 3,000.

The Corporation has paid quarterly dividends since 1958.  There are no
restrictions on the payment of dividends at the current time.  The payment
and amount of future dividends will depend on the existing conditions,
including such factors as the Corporation's earnings, financial condition
and working capital requirements. 


Item 6.        SELECTED FINANCIAL DATA (FROM CONTINUING OPERATIONS)

               1997         1996         1995         1994         1993
           ------------ ------------ ------------ ------------ ------------
Net sales  $163,599,400 $171,218,487 $169,455,886 $149,438,108 $132,832,228

Net income    8,813,858   14,113,747   15,496,033   10,460,397   11,238,406

Net income
 per common
 share              .56          .87          .94          .64          .68

Total
 assets     138,031,696  140,822,440  149,996,525  144,528,888  144,365,419

 Cash dividends
 per common
 share              .32          .32          .31          .28          .28

Return on
 equity            7.7%        12.2%        14.5%         9.6%        10.8%














                                      5
Item 7.        MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION 
               AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS 1997 VERSUS 1996

Net sales in 1997 were $163.6 million compared to $171.2 million in 1996, a
decline of $7.6 million or 4.4%.  Net income from continuing operations was
$8.8 million, $.56 per share in 1997, compared to $14.1 million, $.87 per
share in 1996.

The sales decline in 1997 was due to lowered demand for products of the
industrial portion of the Corporation's business.  The decline occurred
through the first nine months of 1997.  In the fourth quarter, sales of the
industrial group returned to levels comparable to the final quarter of 1996.
Intense price competition continues to impact sales for this area of the
business.  The automotive portion of the business had sales volumes similar
to 1996.  Through aggressively pursuing business with new customers, the 
Corporation has been able to counteract the softness in the U.S. automotive
business.

Gross profit decreased $5.4 million in 1997.  As a percent of sales, gross
profit was 15.7% in 1997 and 18.1% in 1996.  The decline in 1997 resulted
from a combination of increased material costs and higher unit costs for
certain labor and fixed manufacturing charges.  The increased material costs
were caused by increased unit costs for raw materials along with a
significant expense associated with material consumed through sampling and
start-up of a new product line.  The increased unit costs for certain labor 
and fixed manufacturing charges were a direct result of the sales declines
experienced for 1997.

Selling expenses were $5.1 million in 1997, 3.1% of net sales, and $5.0
million in 1996, 2.9% of net sales.  The increased costs resulted from
marginal increases in compensation and benefit charges.  General and
administrative expenses were $5.7 million in both 1997 and 1996.  As a
percent of net sales the expenses were 3.5% in 1997 and 3.3% in 1996.  

In 1997, postemployment benefits and deferred compensation expenses in the
amount of $3.5 million were charged to operations in connection with staff
reductions and the early retirement of certain executive officers.  This
expense had an effect of $.14 per share in 1997.

Operating income decreased by $9.1 million in 1997.  The decline was a
combination of decreased gross margins as a result of decreased sales and
increased material costs coupled with the $3.5 million charged for
postemployment benefits and deferred compensation.  

Net other income, primarily interest income, was $2.9 million in 1997 and
$3.0 million in 1996. 

Income tax expense was $4.9 million in 1997 and $8.8 million in 1996.  The
effective tax rate was 35.8% in 1997 and 38.4% in 1996.  The reduction in
income tax expense was due to the reduced level of income in 1997 and
adjustments made to estimated effective federal and state tax rates.

Management believes that a renewed focus on the core vinyl calendering
business will return the Corporation to a healthier earnings outlook for
1998.  New automotive and non-automotive business has been obtained and with
the disposal of the consumer products segment completed, Management and other
                                      6
employees of the Corporation are in a position to concentrate on making the
core business more profitable through expansion and emphasis on improved
operating efficiencies.  While Management is confident of the Corporation's
ability to develop and grow the core business based on its strong financial
and market positions, it faces many severe challenges in 1998.  Higher raw
material costs are a continuing impediment to margins and constant pricing
pressures from competitors make it very unlikely that these increases can be
recovered by means of higher unit sales prices.  Additional operating
efficiencies must be implemented to maintain operating margins. 
Additionally, the U.S. auto industry is anticipating lower production levels
in the first half of 1998.  These factors will continue to make it very
difficult to attain desired profitability levels in the short term. 

RESULTS OF OPERATIONS 1996 VERSUS 1995

Net sales for 1996 were $171.2 million compared to $169.5 million for 1995. 
Net income from continuing operations for 1996 was $14.1 million, $.87 per
share, compared to $15.5 million, $.94 per share for 1995.

The 1996 net sales represent an increase of $1.8 million or 1.0%.  The
increase was entirely from sales of automotive-related products.  Through
the end of the third quarter of 1996, sales for the segment had increased
approximately $6.4 million over 1995.  However, substantial reductions in
requirements by major automotive customers in the fourth quarter reduced the
overall 1996 sales increase to the net $1.8 million increase.  1996 sales of
industrial products were virtually the same as 1995.  The sales performance of
this group was negatively affected by extremely competitive pricing pressures
in markets serviced by the industrial products group.  The pressures
continued throughout 1997.  

The gross margin for this segment declined from 20.3% in 1995 to 18.1% in
1996.  While the segment continued to succeed in obtaining numerous
productivity improvements through the efforts of its employees and suppliers,
the efforts for 1996 were mitigated due to problems incurred with the raw
material component of the segment's products.  Raw materials are a very
substantial part of the unit cost for the segment's products and during the
third quarter of 1996 the contamination of a key raw material resulted in raw
material component costs far in excess of normal.  Along with the increased
raw material costs, other manufacturing costs increased as a result of
inefficient production runs, scrapping of defective product and increased
control and review activities to ensure product quality.  Along with the raw
material contamination problem the Corporation experienced continual
pressures from suppliers to accept raw material price increases.  

Operating profit decreased by $3.8 million for the year from $23.7 million
for 1995 to $19.9 million for 1996.  The decrease primarily resulted from
the operational problem created by the previously discussed raw material
contamination as well as customer resistance encountered in attempting to
recover higher material and operational costs through product price increases.
 
Selling expenses were $5.0 million in 1996 and $4.9 million in 1995, 2.9%
percent of net sales for both 1996 and 1995.  Slight increases in
compensation and benefit costs in this area were offset by a reduction in
the charge for doubtful accounts for 1996.  General and administrative
expenses, including postemployment benefits and deferred compensation, were
$6.1 million or 3.6% of net sales for 1996, compared to $5.7 million or 3.4%
of net sales for 1995.  Increases in benefit costs were the main reason for
increased costs for this area in 1996.
                                      7
Other income increased by approximately $850 thousand for 1996.  The
increase was primarily a result of the gain from the sale of various assets
during 1996.   

Income tax expense was $8.8 million in 1996 compared to $10.4 million in 
1995.  The decrease was due to a lower pre-tax income for 1996 and a decrease
in the Corporation's effective tax rate from 40.1% for 1995 to 38.4% for
1996.  The decrease in the effective tax rate was primarily due to lower
charges for state income taxes.


LIQUIDITY AND CAPITAL RESOURCES

Net cash provided by operating activities was $20.8 million in 1997, compared
to $16.7 in 1996 and $20.7 million in 1995.  Cash and cash equivalents
increased by $29.3 million in 1997.  The increase resulted primarily from
the net funds received from the sale of the consumer products business and
the reduction in the amount of funds committed to purchases of the
Corporation's common stock.

Capital expenditures for property, plant and equipment for 1997 were $4.9
million compared to $5.9 million in 1996 and $7.8 million in 1995.  Capital
expenditures for 1998 are expected to be substantially greater due to the
construction of an additional coating facility, which is expected to require
an outlay of approximately $7.0 million.   Other capital expenditures, in
amounts comparable to 1997, are planned by the Corporation to provide
additional capacity or modernize equipment to meet customer demands for new
or improved products or production processes.

The Corporation had no outstanding debt at December 31, 1997.  There is in
place a $35 million line of credit which expires in June 1998.  The
Corporation is currently in the process of renewing its line of credit into
a new two-year facility.   At December 31, 1997, the line of credit was
uncommitted. 

In 1997, the Corporation's Board of Directors authorized the repurchase of
an additional one million shares of the Corporation's common stock as market
conditions permit.  This authorization adds to an existing 800,000 share
authorization against which 766,800 shares have been purchased. 

Management of the Corporation believes that net cash flow from operating
activities, along with available financing capabilities will be adequate to
meet the Corporation's funding requirements for 1998.  


 


 
  


   





                                      8
Item 8.        FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

This page left blank intentionally.  See following pages for financial
statements.






















































                                      9
                  O'SULLIVAN CORPORATION AND SUBSIDIARIES
                        CONSOLIDATED BALANCE SHEETS
                         December 31, 1997 and 1996

                                                 1997             1996
                                            -------------   -------------
ASSETS
Current Assets
   Cash and cash equivalents                $  35,444,138   $   6,192,431
   Receivables                                 25,658,216      23,788,028
   Inventories                                 20,674,689      26,407,284
   Deferred income tax assets                   1,041,564       1,090,840
   Other current assets                         3,234,108       3,483,706
   Assets of discontinued operations                -- --      29,648,824 
                                            -------------   -------------
          Total current assets              $  86,052,715   $  90,611,113
                                            -------------   -------------
Property, Plant and Equipment               $  40,316,399   $  41,426,522
                                            -------------   -------------
Other Assets                                $  11,662,582   $   8,784,805
                                            -------------   -------------
            Total assets                    $ 138,031,696   $ 140,822,440
                                            =============   =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
   Accounts payable                         $   9,988,826   $  10,269,685
   Accrued expenses                             5,968,248       5,633,599
   Liabilities of discontinued operations           -- --       4,688,142
                                            -------------   -------------
          Total current liabilities         $  15,957,074   $  20,591,426
                                            -------------   -------------

Long-Term Liabilities                       $   8,404,635   $   3,098,165  
                                            -------------   -------------
                                            
Deferred Income Tax Liabilities             $     954,921   $   3,134,527
                                            -------------   -------------

Commitments and Contingencies               $       -- --   $       -- --
                                            -------------   -------------
Stockholders' Equity
   Common stock, par value $1.00 per share;
     authorized 30,000,000 shares           $  15,743,062   $  15,850,562
   Additional paid-in capital                   2,717,863       3,606,399
   Retained earnings                           94,254,141      94,778,803
   Unrecognized pension costs, net of
     deferred tax effect                            -- --        (237,442)
                                            -------------   -------------
          Total stockholder's equity        $ 112,715,066   $ 113,998,322
                                            -------------   ------------- 
          Total liabilities and
            stockholders' equity            $ 138,031,696   $ 140,822,440
                                            =============   =============

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


                                     10
                  O'SULLIVAN CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF INCOME
                Years Ended December 31, 1997, 1996 and 1995

                                      1997          1996          1995
                                  ------------  ------------  ------------
Net sales                         $163,599,400  $171,218,487  $169,455,886
Cost of products sold              137,976,808   140,180,005   135,101,446
                                  ------------  ------------  ------------
          Gross profit            $ 25,622,592  $ 31,038,482  $ 34,354,440
                                  ------------  ------------  ------------
Operating expenses
  Selling and warehousing         $  5,067,830  $  5,000,111  $  4,911,010
  General and administrative         5,701,472     5,650,032     5,339,246
  Postemployment benefits and
    deferred compensation            4,033,375       493,773       397,798
                                  ------------  ------------  ------------
                                  $ 14,802,677  $ 11,143,916  $ 10,648,054
                                  ------------  ------------  ------------
     Income from operations       $ 10,819,915  $ 19,894,566  $ 23,706,386
                                  ------------  ------------  ------------
Other income (expense)
  Interest income                 $  2,551,492  $  2,590,080  $  2,529,196
  Other, net                           360,388       422,008      (369,322)
                                  ------------  ------------  ------------
                                  $  2,911,880  $  3,012,088  $  2,159,874
                                  ------------  ------------  ------------
     Income from continuing opera-
       tions before income taxes  $ 13,731,795  $ 22,906,654  $ 25,866,260
                 
Income taxes                         4,917,937     8,792,907    10,370,227
                                  ------------  ------------  ------------
     Income from continuing
       operations                 $  8,813,858  $ 14,113,747  $ 15,496,033
                                  ------------  ------------  ------------  
 Discontinued operations:
     Loss from discontinued 
       operations, net of taxes   $   (593,593) $ (3,384,254) $ (1,463,970)
     Loss on disposal of
       discontinued operations,
       net of taxes                 (3,674,046)        -- --         -- --
                                  ------------  ------------  ------------
                                  $ (4,267,639) $ (3,384,254) $ (1,463,970)
                                  ------------  ------------  ------------
          Net income              $  4,546,219  $ 10,729,493  $ 14,032,063
                                  ============  ============  ============
Net income (loss) per common share, basic and diluted:
  Net income per common share from 
    continuing operations         $        .56  $        .87  $        .94
  Net loss per common share from 
    discontinued operations               (.04)         (.21)         (.09)
  Net loss per common share from dis-
    posal of discontinued operations      (.23)        -- --         -- --
                                  ------------  ------------  ------------
    Net income per common share   $        .29  $        .66  $        .85
                                  ============  ============  ============
The accompanying notes are an integral part of the consolidated financial
statements.
                                     11
                  O'SULLIVAN CORPORATION AND SUBSIDIARIES
                   CONSOLIDATED STATEMENTS OF CASH FLOWS
                Years Ended December 31, 1997, 1996 and 1995

                                      1997          1996          1995
                                  ------------  ------------  ------------
Cash Flows from Operating Activities
 Net income from continuing        
  operations                      $  8,813,858  $ 14,113,747  $ 15,496,033
 Adjustments to reconcile net 
  income from continuing operations 
  to net cash provided by operating
  activities of continuing operations:
   Depreciation                      5,464,100     5,177,727     4,861,351
   Provision for doubtful accounts       -- --        77,000       275,000
   Deferred income taxes            (1,259,559)      975,985       386,964
   Postemployment benefits and
     deferred compensation           3,373,377       301,173       233,323
   Other operating assets and
     long-term liabilities            (469,368)     (208,772)      (34,258)
   (Gain)loss from disposal
    of assets                          345,533      (552,461)      (35,090)
   Unremitted (income) loss from
    joint venture                     (186,989)      (19,071)      209,825
   Interest accrual on zero coupon 
     notes receivable                    -- --        (4,538)     (196,025)
   Changes in operating assets
    and liabilities:  
     Receivables                    (1,870,188)     (505,769)    8,902,287
     Inventories                     5,732,595     1,332,390    (6,639,796)
     Other current assets              757,469      (206,833)      421,769
     Accounts payable                 (280,859)   (2,141,185)     (781,628)
     Accrued expenses                  351,640    (1,688,406)   (2,377,023)
                                  ------------  ------------  ------------
 Net cash provided by operating
   activities                     $ 20,771,609  $ 16,650,987  $ 20,722,732
                                  ------------  ------------  ------------

Cash Flows from Investing Activities
 Purchase of property, plant and
  equipment                       $ (4,885,185) $ (5,888,238) $ (7,790,574)
 Proceeds from disposal of
  fixed assets                         205,037     1,306,488       134,627
 Proceeds from disposal of
  subsidiary                        21,958,209         -- --         -- --
 Funds (advance to) repayment from
   discontinued operations           1,088,618    (5,628,416)   (4,907,606)
 Investment in and loan to
  joint venture                          -- --      (441,000)   (1,128,362)
 Payments received from non-
  operating notes receivable           207,289     2,417,883       180,917
 Change in other assets             (3,503,485)     (626,447)     (996,456)
 Other                                (553,921)      341,192      (460,642
                                  ------------  ------------  ------------
 Net cash provided by (used in)
  investing activities            $ 14,516,562  $ (8,518,538) $(14,968,096)
                                  ------------  ------------  ------------

                                     12
                  O'SULLIVAN CORPORATION AND SUBSIDIARIES
                   CONSOLIDATED STATEMENTS OF CASH FLOWS
                Years Ended December 31, 1997, 1996 and 1995
                                  (Continued)

                                      1997          1996          1995
                                  ------------  ------------  ------------
Cash Flows from Financing Activities
 Cash dividends                   $ (5,040,428) $ (5,160,413) $ (5,117,607)
 Purchase of common stock             (996,036)   (7,235,736)       (2,635)
 Issuance of common stock                -- --         -- --       246,985
                                  ------------  ------------  ------------
 Net cash (used in)
  financing activities            $ (6,036,464) $(12,396,149) $ (4,873,257)
                                  ------------  ------------  ------------
Increase (decrease) in cash and
 cash equivalents                 $ 29,251,707  $ (4,263,700) $    881,379
                                   
Cash and cash equivalents at
 beginning of period                 6,192,431    10,456,131     9,574,752
                                  ------------  ------------  ------------
Cash and cash equivalents at
 end of period                    $ 35,444,138  $  6,192,431  $ 10,456,131
                                  ============  ============  ============


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






























                                     13
                  O'SULLIVAN CORPORATION AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                Years Ended December 31, 1997, 1996 and 1995     

                                     Common      Additional     Retained
                                      Stock    Paid-in Capital  Earnings
                                  ------------  ------------  ------------
Balance at January 1, 1995        $ 16,484,831  $  9,963,516  $ 80,539,058
  Net income                             -- --         -- --    14,032,063
  Issuance of common stock              25,811       221,174         -- --
  Purchase of common stock                (240)       (2,395)        -- --
  Dividends declared, $.31 per share     -- --         -- --    (5,117,607)
  Translation adjustments                -- --         -- --         -- --
  Unrecognized pension costs             -- --         -- --         -- --
                                  ------------  ------------  ------------
Balance at December 31, 1995      $ 16,510,402  $ 10,182,295  $ 89,453,514
  Net income                             -- --         -- --    10,729,493
  Purchase of common stock            (659,840)   (6,575,896)        -- --
  Dividends declared, $.32 per share     -- --         -- --    (5,160,413)
  Translation adjustments                -- --         -- --      (243,791)
  Unrecognized pension costs             -- --         -- --         -- --
                                  ------------  ------------  ------------
Balance at December 31, 1996      $ 15,850,562  $  3,606,399  $ 94,778,803
  Net income                             -- --         -- --     4,546,219
  Purchase of common stock            (107,500)     (888,536)        -- --
  Dividends declared, $.32 per share     -- --         -- --    (5,040,428)
  Translation adjustments                -- --         -- --       (30,453)
  Unrecognized pension costs             -- --         -- --         -- --
                                  ------------  ------------  ------------
Balance at December 31, 1997      $ 15,743,062  $  2,717,863  $ 94,254,141
                                  ============  ============  ============



























                                     14 
                  O'SULLIVAN CORPORATION AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY    
                Years Ended December 31, 1997, 1996 and 1995
                                 (Continued)

                                   Cumulative   Unrecognized
                                  Translation      Pension    Stockholders'
                                  Adjustments       Costs        Equity
                                  ------------  ------------  ------------
Balance at January 1, 1995        $   (345,102) $      -- --  $106,642,303
  Net income                             -- --         -- --    14,032,063
  Issuance of common stock               -- --         -- --       246,985
  Purchase of common stock               -- --         -- --        (2,635)
  Dividends declared, $.31 per share     -- --         -- --    (5,117,607)
  Translation adjustments              124,536         -- --       124,536
  Unrecognized pension costs             -- --      (162,680)     (162,680)
                                  ------------  ------------  ------------
Balance at December 31, 1995      $   (220,566) $   (162,680) $115,762,965
  Net income                             -- --         -- --    10,729,493
  Purchase of common stock               -- --         -- --    (7,235,736)
  Dividends declared, $.32 per share     -- --         -- --    (5,160,413)
  Translation adjustments              220,566         -- --       (23,225)
  Unrecognized pension costs             -- --       (74,762)      (74,762)
                                  ------------  ------------  ------------
Balance at December 31, 1996      $      -- --  $   (237,442) $113,998,322
  Net income                             -- --         -- --     4,546,219
  Purchase of common stock               -- --         -- --      (996,036)
  Dividends declared, $.32 per share     -- --         -- --    (5,040,428)
  Translation adjustments                -- --         -- --       (30,453)
  Unrecognized pension costs             -- --       237,442       237,442
                                  ------------  ------------  ------------
Balance at December 31, 1997      $      -- --  $      -- --  $112,715,066
                                  ============  ============  ============

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






















                                     15                                    
                  O'SULLIVAN CORPORATION AND SUBSIDIARIES
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.   Summary of Accounting Policies

Nature of Operations-O'Sullivan Corporation manufactures calendered plastics
products for the automotive and specialty manufacturing industries. 
Substantially all of the Corporation's business is conducted in North
American markets.   

Basis of Presentation and Principles of Consolidation-The consolidated
financial statements include the accounts of all Subsidiaries.  Significant
intercompany accounts and transactions have been eliminated.  Investments in
affiliates in which the Corporation has a 20% to 50% interest are carried at
cost, adjusted for the Corporation's proportionate share of the affiliate's
undistributed earnings or losses.

The preparation of consolidated financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenue and expenses.
Actual results could differ from those estimates.  
 
Cash and Cash Equivalents-The Corporation considers all highly liquid
investments with a maturity of three months or less at the time of purchase
to be cash equivalents.

Receivables and Concentration of Credit Risk-Receivables from trade customers
are generally due within thirty to sixty days.  The Corporation conducts
periodic reviews of its major customers' financial condition and grants
trade credit based upon evaluations of the credit worthiness of each
customer.  Management performs regular assessments of receivables and makes
estimates as to the adequacy of the allowance for doubtful accounts based on
historical data and knowledge of customers' financial condition.  Credit losses
have been within the expectations of management.    

Inventories-Inventories are valued at the lower of cost or market, with cost
being determined substantially by the first-in, first-out or average cost
method.

Investment Securities-Investment securities held principally for the purpose
of selling them in the near term are classified as trading securities. 
Trading securities are recorded at fair value on the balance sheet as a
current asset, with the change in fair value during the period included in
earnings.  At December 31, 1997 these securities had a fair value of $507,870. 

Property, Plant and Equipment and Depreciation-Property, plant and equipment
are stated at historical cost.  Depreciation is computed primarily by the
straight-line method over the estimated useful lives of assets. The estimated
useful lives are twenty to forty years for buildings and three to ten years
for machinery and other equipment.  Accelerated methods of depreciation are
utilized for tax purposes.  Expenditures for repairs and maintenance are
charged to operations as incurred.  Betterments and improvements that extend
the useful life of an asset are capitalized.  Upon sale and other
dispositions of assets, the cost and related accumulated depreciation is
removed from the accounts and the resulting gain or loss is reflected in
operations.                          16
Income Taxes-Deferred taxes are provided on a liability method whereby
deferred tax assets are recognized for deductible temporary differences and
tax credit carryforwards and deferred tax liabilities are recognized for
taxable temporary differences.  Temporary differences are the differences
between the reported amounts of assets and liabilities and their tax bases. 
Deferred tax assets are reduced by a valuation allowance when, in the opinion
of management, it is more likely than not that some portion or all of the
deferred tax assets will not be realized.  Deferred tax assets and
liabilities are adjusted for the effects of changes in tax laws and rates on
the date of enactment.  

Advertising Costs-Costs incurred for producing and communicating advertising
are expensed when incurred.  Advertising costs were $89,090 for 1997, $76,122
for 1996 and $103,094 for 1995.

Research and Development-Product and process research and development are
charged to expense as incurred.

Earnings Per Share-In 1997, the Financial Accounting Standards Board issued
Statement No. 128, "Earnings Per Share."  Statement 128 replaced the
calculation of primary and diluted earnings per share with basic and diluted
earnings per share.  Basic earnings per share excludes any dilutive effects
of options, warrants and convertible securities.  Diluted earnings per share
is very similar to the previously reported fully diluted earnings per share.
All earnings per share amounts for all periods have been presented, and where
appropriate, restated to conform to the Statement 128 requirements. 
 
Pension Plans-The Corporation and its Subsidiaries have retirement plans that
cover substantially all employees who meet certain eligibility requirements.
The Retirement Savings Plan (Plan) is a 401(K) plan under which the majority
of the Corporation's employees are covered.  The Plan permits eligible
employees to contribute up to ten percent of before-tax compensation and up
to five percent of after-tax compensation subject to certain Internal Revenue
Service restrictions.  The Corporation may, in its discretion, make an 
Employer Basic Contribution of up to three percent of each participant's
compensation each year.  The Corporation may also, in its discretion, make
an Employer Matching Contribution of up to two percent for participants who
have elected to make before-tax contributions to the Plan.  After three years
of service participants become 100% vested in the Employer contributions for
each participant. 

Current and former employees not covered under the Retirement Savings Plan
are participants in either multi-employer plans sponsored by other entities
or non-contributory defined benefit plans providing benefits to certain
salaried employees based on years of service and final years' average
earnings and to certain hourly employees based on a dollar unit multiplied
by years of eligible service.  The Corporation's policy is to fund at least
the minimum amounts required by the applicable governing bodies.










                                     17
Postretirement Benefits-The Corporation provided health care benefits to
certain of its retired employees under a plan which was terminated January 1,
1993.  Upon termination of the plan this group of retired employees was
allowed to continue to be covered by the Corporation's group insurance plan.
Effective January 1, 1993 the Corporation adopted Financial Accounting
Standards Board Statement No. 106 to account for its share of the costs of
benefits provided to this group.  To effect adoption of Statement no. 106, the
Corporation accrued as of January 1, 1993 its share of the estimated costs to
insure this group of retirees.  Prior to January 1, 1993, the Corporation
expensed its share of these expenses as they were incurred.

Postemployment Benefits-The liability and expense for postemployment benefits
are accrued when the obligations vest and can be reasonably estimated. 
Obligations that do not vest are recorded when payment of the benefits is
probable and can be reasonably estimated.

Reclassification of Amounts-Certain amounts for 1996 and 1995 have been
reclassified to reflect comparability with account classifications for 1997.

2.   Supplementary Balance Sheet Detail

Balances at December 31,                   1997             1996
                                       ------------     ------------

Receivables
Accounts receivable                    $ 26,228,366     $ 24,361,797   
Less allowance for doubtful accounts        570,150          573,769
                                       ------------     ------------ 
                                       $ 25,658,216     $ 23,788,028
                                       ============     ============
Receivable balances for automotive related business were $14,711,831 at 	  
December 31, 1997 and $12,736,630 at December 31, 1996.

Inventories
Finished goods                         $  4,505,483     $  5,563,314
Work in process                           3,385,687        7,080,058
Raw materials                             9,380,683       10,551,277 
Supplies                                  3,402,836        3,212,635
                                       ------------     ------------
                                       $ 20,674,689     $ 26,407,284
                                       ============     ============

Property, Plant and Equipment
Land                                   $  1,414,776     $  1,160,065
Buildings                                27,762,932       25,959,282
Machinery and equipment                  58,458,348       60,004,921 
Transportation equipment                  3,981,665        3,838,249
                                       ------------     ------------ 
                                       $ 91,617,721     $ 90,962,517
Less accumulated depreciation            51,301,322       49,535,995 
                                       ------------     ------------
                                       $ 40,316,399     $ 41,426,522
                                       ============     ============

Depreciation expense totaled $5,464,100, $5,177,727 and $4,861,351 in 
1997, 1996 and 1995, respectively.


                                     18 
Accrued Expenses 
Accrued compensation                  $  2,527,053      $  2,362,895
Employee benefits                          886,467           952,327  
Dividends payable                        1,257,623         1,274,621
Other accrued expenses                   1,297,105         1,043,756
                                      ------------      ------------ 
                                      $  5,968,248      $  5,633,599
                                      ============      ============

Long-Term Liabilities
Deferred compensation                 $  3,978,100      $  1,685,792
Employee benefits                          845,466         1,412,373  
Postemployment benefits                  1,081,069             -- -- 
Contingency reserve for 
  discontinued operations                2,500,000             -- --
                                      ------------      ------------
                                      $  8,404,635      $  3,098,165
                                      ============      ============

The contingency reserve for discontinued operations is an allowance for 
potential adjustments relating to the sale of the Corporation's former
consumer products subsidiary.


3.   Debt
                                                     
The Corporation has a $35,000,000 unsecured line of credit through First
Union National Bank of Virginia to support general corporate activities. 
Interest rates for the line of credit vary based on the Corporation's choice
of rate options provided by the lender.  All available rates are at or below
prevailing prime interest rates.  The line of credit matures June 30, 1998. 
There was no outstanding balance at December 31, 1997.

Interest expense was $8,482 for 1997, $2,976 for 1996 and $5,202 for 1995. 
                                                            























                                     19
4.   Investment in Unconsolidated Joint Venture

The Corporation acquired a 49% equity interest in Keifel Technologies, Inc.
("Keifel") during 1995.  Keifel designs, manufactures and distributes
thermoforming and radio frequency welding machines and related machinery and
tools.  Financial information for Keifel is as follows:

Income Statement Data For The Years Ended December 31, 1997 and 1996
And For The Period August 9, 1995 Through December 31, 1995

                                            Period Ended December 31,
                                       1997           1996           1995
                                   ------------   ------------   ------------

Net sales                          $ 12,130,635   $  5,986,996   $    213,312
Gross profit (loss)                $  1,897,988   $  1,174,687   $    (27,439)
Net income (loss)                  $    381,610   $     38,920   $   (428,214)

Corporation's share of net 
  income (loss)                    $    186,989   $     19,071   $   (209,825)


Balance Sheet Data at December 31,     1997           1996
---------------------------------- ------------   ------------

Assets
  Current assets                   $  7,039,272  $   3,134,561
  Property, plant and equipment, net  1,805,752      1,950,801
  Other assets                            9,500          9,500
                                   ------------  -------------
  Total assets                     $  8,854,524  $   5,094,862
                                   ============  =============

Liabilities and Equity
  Current liabilities              $  3,796,010  $   2,384,526
  Notes payable                       2,496,000      2,496,000
  Other long-term liabilities         2,070,191        103,623
  Stockholders' equity                  492,323        110,713
                                   ------------  -------------
  Total liabilities and equity     $  8,854,524  $   5,094,862
                                   ============  =============

  Corporation's share of equity    $    241,238  $      54,249
                                   ============  =============


5.   Income Tax Matters

Pretax income for the years ended December 31, 1997, 1996 and 1995 was taxed
entirely by domestic jurisdictions.

                               1997             1996             1995
                           ------------     ------------     ------------
          
                           $ 13,731,795     $ 22,906,654     $ 25,866,260
                           ============     ============     ============


                                     20
Net deferred tax benefits (liabilities) at December 31, 1997 and 1996
consisted of the following components:
                                                 1997             1996
                                             ------------     ------------
         Deferred tax assets
           Provision for doubtful accounts   $    224,709     $    226,008
           Employee benefits                    2,970,246        1,707,436
           Inventory basis differences            109,675          167,400
           Contingency reserve for 
             discontinued operations            1,024,453           28,239
           Operating loss carryforward             65,300            -- --
           Other                                    -- --           40,818
                                             ------------     ------------
                                             $  4,394,383     $  2,169,901
                                             ------------     ------------
         Deferred tax liabilities
           Investment securities             $    203,147     $      -- -- 
           Property, plant and equipment        3,608,737        3,757,110
           Like-kind exchange                     254,856          254,856
           Employee benefits                      241,000          201,622
                                             ------------     ------------
                                             $  4,307,740     $  4,213,588
                                             ------------     ------------
         Net deferred tax 
           benefits (liabilities)            $     86,643     $ (2,043,687)
                                             ============     ============

The deferred tax amounts included above have been classified on the balance
sheets for December 31, 1997 and 1996 as follows:
                                                 1997             1996   
                                             ------------     ------------

         Current assets                      $  1,041,564     $  1,090,840
         Noncurrent liabilities                  (954,921)      (3,134,527)
                                             ------------     ------------
         Net deferred tax 
           benefits (liabilities)            $     86,643     $ (2,043,687)
                                             ============     ============

The provision for income taxes charged to continuing operations for the years 
ended December 31, 1997, 1996 and 1995 consists of the following:

                               1997             1996             1995
                           ------------     ------------     ------------
         Current
            Federal        $  5,119,111     $  6,681,713     $  7,872,128
            State             1,058,385        1,021,619        2,111,135
                           ------------     ------------     ------------
                           $  6,177,496     $  7,703,332     $  9,983,263
                           ------------     ------------     ------------
         Deferred
           Federal         $ (1,037,444)    $    951,017     $    332,624
           State               (222,115)         138,558           54,340
                           ------------     ------------     ------------
                           $ (1,259,559)    $  1,089,575     $    386,964
                           ------------     ------------     ------------
                           $  4,917,937     $  8,792,907     $ 10,370,227
                           ============     ============     ============
                                     21
The income tax provision differs from the amount of income tax determined by
applying the US federal income tax rate to pretax income (from continuing
operations) for the years ended December 31, 1997, 1996 and 1995 due to the
following:
                                                   1997     1996     1995
                                                 -------- -------- --------
 Statutory federal tax rate                        35.0%    35.0%    35.0%
 Income taxed at lower federal tax rate             (.7%)   -- --    -- --
 State taxes, net of federal benefit                4.0%     3.3%     5.4%
 Business credits                                   (.6%)    (.4%)   -- --
 Other                                             (1.9%)     .5%     (.3%)
                                                 -------- -------- --------
                                                   35.8%    38.4%    40.1%
                                                 ======== ======== ========
6.   Benefit Plans

Defined Benefit Plans

The net pension cost for defined benefit plans included the following
components:
                                     1997           1996           1995
                                 -----------    -----------    -----------
Benefits earned during the year  $    77,867    $    70,097    $    56,714
Interest cost on projected
  benefit obligation                 579,703        569,327        549,922
Actual (return) on assets         (1,534,219)      (519,968)    (1,027,919)
Net amortization and deferral        952,576        (25,142)       552,498
Settlement (gain)                      -- --          -- --        (81,954)
                                 -----------    -----------    -----------
Net pension cost                 $    75,927    $    94,314    $    49,261
                                 ===========    ===========    ===========

The funded status of the defined benefit pension plans as of December 31, 
1997 was as follows:
                                              Overfunded      Underfunded
                                             ------------     ------------
         Actuarial present value:
           Vested benefit obligation         $  2,486,629     $  6,121,430
           Nonvested benefit obligation             -- --          131,430
                                             ------------     ------------
         Accumulated benefit obligation      $  2,486,629     $  6,252,860
         Effect of projected compensation
           increases                                -- --            -- --
                                             ------------     ------------
         Projected benefit obligation        $  2,486,629     $  6,252,860
         Fair value of plan assets              3,535,605        5,684,394
                                             ------------     ------------
         Plan assets in excess of (less than)
           projected benefit obligation      $  1,048,976     $   (568,466)
         Unrecognized net (gain)                 (239,411)        (330,240)
         Unrecognized prior service costs           -- --          456,155
         Unrecognized net (asset) liability        
           at initial adoption of FAS 87         (207,066)          16,826
         Adjustment required to recognize
           minimum liability                        -- --         (142,741)
                                             ------------     ------------
         Prepaid (accrued) pension cost      $    602,499     $   (568,466)
                                             ============     ============
                                     22 
The funded status of the defined benefit pension plans as of December 31,
1996 was as follows:
                                              Overfunded      Underfunded
                                             ------------     ------------
         Actuarial present value:
           Vested benefit obligation         $  2,462,773     $  5,940,487
           Nonvested benefit obligation             -- --          101,829
                                             ------------     ------------
         Accumulated benefit obligation      $  2,462,773     $  6,042,316
         Effect of projected compensation
           increases                                -- --            -- --
                                             ------------     ------------
         Projected benefit obligation        $  2,462,773     $  6,042,316
         Fair value of plan assets              3,029,968        4,961,943
                                             ------------     ------------
         Plan assets in excess of (less than)
           projected benefit obligation      $    567,195     $ (1,080,373)
         Unrecognized net loss                    166,934          158,338
         Unrecognized prior service costs           -- --          525,489
         Unrecognized net (asset) liability
           at initial adoption of FAS 87         (230,073)          20,191
         Adjustment required to recognize
           minimum liability                        -- --         (704,018)
                                             ------------     ------------
         Prepaid (accrued) pension cost      $    504,056     $ (1,080,373)
                                             ============     ============

Discount rates for the plans were 7%. The assumed long-term rates of return
on plan assets were 8%.  The unrecognized asset (liability) at the initial
adoption of FAS 87 is being amortized on a straight-line basis over the
average remaining service period of plan participants.  Plan assets consist
of listed common stocks, corporate and government bonds and short-term
investments.

Retirement Savings Plan

The expense associated with the Retirement Savings Plan was $1,406,655 for
1997, $1,360,993 for 1996 and $1,312,222 for 1995.

Deferred Compensation Plan

The Corporation has a deferred compensation program for key employees of the
Corporation.  Under this program, the Corporation agrees to pay each covered
employee a certain sum annually for fifteen years upon their retirement or,
in the event of their death, to their designated beneficiary.  A benefit is
also paid if the employee terminates employment (other than by his voluntary
action or discharge for cause) before they attain age 65.  In that event, the
amount of the benefit depends on the employee's years of service with the
Corporation.  Full benefits are paid only if the employee completes 25 years
of service.  The Corporation has purchased individual life insurance
contracts with respect to each employee covered by this program.  The
Corporation is the owner and beneficiary of the insurance contracts.  The
employees are general creditors of the Corporation with respect to these
benefits. The expense associated with the Deferred Compensation Plan was
$2,503,375 for 1997, $493,773 for 1996 and $397,798 for 1995.  The expense
for 1997 included an additional charge of $1,975,747 resulting from a change
in the estimated costs for deferred compensation payable to several employees
who prematurely separated from service with the Corporation.
                                     23 
Postretirement Benefit Plan

At January 1, 1993 the Corporation adopted Statement of Financial Accounting
Standards No. 106, "Employers' Accounting for Postretirement Benefits Other
Than Pensions."  This statement requires the Corporation to recognize the
estimated costs of providing certain postretirement benefits to former
employees of the Corporation.  The Corporation elected to recognize the
transition obligation immediately as the effect of an accounting change.

Annual net postretirement benefit costs are determined on an actuarial basis.
Net periodic postretirement benefit cost included the following components
for the years ended December 31, 1997, 1996 and 1995:
 
                                          1997        1996        1995
                                       ----------  ----------  ----------
   Interest expense on accumulated
     postretirement benefit obligation $   26,000  $   28,000  $   27,000
   Other amortization and deferrals         5,000       2,000     (16,000)
                                       ----------  ----------  ----------
                                       $   31,000  $   30,000  $   11,000
                                       ==========  ==========  ==========
 
Postretirement benefit obligations at December 31, 1997 and 1996, none of which
are funded, are as follows:
                                                 1997              1996
                                             ------------     ------------
   Accumulated postretirement
     benefit obligation, retirees            $    277,000     $    332,000
   Plan assets                                      -- --            -- --
                                             ------------     ------------
   Accumulated postretirement benefit
     obligation in excess of plan assets     $    277,000     $    332,000
   Unrecognized transition obligation               -- --            -- --
   Unrecognized net experience losses (gains)       -- --            -- --
                                             ------------     ------------
   Accrued postretirement benefit obligation $    277,000     $    332,000
                                             ============     ============

For measurement purposes, a 12% annual rate of increase in per capita health
care costs of covered benefits was assumed for 1997, with such annual rate
of increase gradually declining to 6% in 2003.

Postemployment Benefits

The Corporation provides certain compensation benefits to former employees.
For 1997 a provision for costs in the amount of $1,530,000 was charged to
operations.


7.   Leases

The Corporation and its Subsidiaries lease various plant and warehouse
facilities along with various equipment.  Leases for the plant and warehouse
facilities and leases for machinery and equipment generally require the
payment of appropriate taxes, insurance and maintenance costs.  The leases
are cancelable within a limited period of time.   
 
Rental expense was $508,890 for 1997, $670,496 for 1996 and $625,843 for 1995.
                                     24
8.   Research and Development

Research and development costs charges to expense were $2,739,388 for 1997,
$2,554,826 for 1996 and $2,983,552 for 1995.


9.   Commitments and Contingencies

Legal Matters

The Corporation and its Subsidiaries are parties to various pending judicial
proceedings arising in the ordinary course of business, including a
proceeding involving the New Jersey facility formerly occupied by the
Corporation's discontinued consumer products subsidiary.  Management and its
legal counsel have reviewed the possible outcome of pending proceedings and
have determined that any liabilities which may result from current
proceedings are not reasonably likely to have a material effect on the
Corporation's financial condition or results of operations.

Environmental Matters

The Corporation continues to modify, on an ongoing, regular basis, certain
of its processes which may have an environmental impact.  The Corporation's
efforts in this regard include the removal of many of its underground
storage tanks and the reduction or elimination of certain chemicals and
wastes in its operations.  Although it is very difficult to quantify the
potential impact of compliance with environmental protection laws, the
Corporation's financial statements reflect the cost of these ongoing
modifications.  Management believes that the continuing costs to the
Corporation of environmental compliance will not result in a material
adverse effect on its future financial condition or results of operations.

Facilities Addition

The Corporation has committed to the construction of an additional coating
facility at its Winchester, Virginia location.  The total outlay for the
facility is expected to be approximately $7.0 million.  The facility is
expected to be placed in service during the third quarter of 1998.

Year 2000 Readiness

Management has taken steps to examine the Corporation's potential exposure
to business interruption due to possible Year 2000 computer software
failures.  Employees connected with the Management Information Services
department have reviewed the software being utilized for operation of the
Corporation's primary business operations system and the software used in
the operation of various LANs running throughout the Corporation.  They have
determined that currently there are no apparent conflicts which will prevent
the present software from operating properly at Year 2000.  Personnel
connected with the Maintenance Services area of the Corporation have made
similar reviews and inquiries concerning software used in the operation of
the Corporation's manufacturing equipment.  At this time they are aware of
no material conflicts that would jeopardize the operation of the
Corporation's manufacturing operations.




                                     25
10.   Significant Customer
 
Net sales to divisions and subsidiaries of Ford Motor Company amounted to
$44,142,504 (27.0% of net sales) in 1997, $44,186,054 (25.8% of net sales)
in 1996 and $40,622,615 (24.0% of net sales) in 1995.

Receivables at December 31, 1997, 1996 and 1995 from Ford Motor Company were
$6,289,788, $5,006,569, and $6,275,579, respectively.


11.   Stock Option Plans

1985 Stock Option Plan

The 1985 option plan expired January 28, 1995.  Options previously granted
may be exercised by the participants until the options expire, which is ten
years after the date of the original option grant.  The option price of
grants under this plan could not be less than the fair market value of the
common stock on the date of grant. 

1995 Stock Option Plan

The Corporation has a stock option plan under which options may be granted to
certain key employees for the purchase of the Corporation's common stock. 
The effective date of the Plan was February 7, 1995 with an expiration date
of February 6, 2005.  The Plan reserves for issuance an aggregate of 200,000
shares of the Corporation's common stock.  The option price for options
granted cannot be less than 100% of fair market value of the common stock on
the date of the grant.  The Plan contains an antidilutive provision providing
for adjustments to the options previously granted in the event of changes in
the Corporation's capital structure.

1995 Outside Directors Stock Option Plan

The Corporation has a stock option plan under which options may be granted to
members of the Corporation's Board of Directors for the purchase of the
Corporation's common stock.  The effective date of the Plan was April 25,
1995 with an expiration date of  April 24, 2005.  The Plan reserves for
issuance an aggregate of 200,000 shares of the Corporation's common stock.
Each eligible director received an option for 10,000 shares common stock on
the effective date of the Plan.  On each April 25 thereafter each eligible
director will receive an option for 1,000 shares of common stock.  Directors
who become eligible after April 25, 1995 will receive an option for 10,000
shares as of the date they become eligible for the Plan and will receive an
option for 1,000 shares on each April 25 thereafter.  The option price for
options granted cannot be less than 100% of fair market value of the common
stock on the date of the grant.  The plan contains an antidilutive provision
providing for adjustments to the options previously granted in the event of
changes in the Corporation's capital structure.
 

The fair value of each grant is estimated at the grant date using the
Black-Scholes option-pricing model.  For 1997, no options were granted
requiring measurement under this model.  For 1996 weighted-average
assumptions were: Dividend rate of 2.9%, price volatility of 25%, a risk-free
interest rate of 5.31% and expected lives of 7.75 years.  


                                     26
The Corporation applies APB Opinion 25 in accounting for its stock option
plans.  Accordingly, no compensation expense has been recognized for 1997,
1996 or 1995.  If the fair value method of accounting for stock options
prescribed by FAS No. 123 had been applied, there would have been no expense
relating to the stock options for 1997.  The expense would have been $41,437
in 1996 and $184,883 in 1995.  Pro forma net income would have been
$10,688,056 in 1996 and $13,847,180 in 1995.  Pro forma earnings per share 
would have been $.66 in 1996 and $.84 in 1995.


The status of the stock option plans during 1997 and 1996 is as follows:

                                                            1995 Directors
                    1985 Option Plan     1995 Option Plan     Option Plan
                    ----------------     ----------------   --------------
                              Weighted           Weighted           Weighted
                              Average            Average            Average
                    Number of Exercise Number of Exercise Number of Exercise
                     Shares     Price   Shares     Price   Shares     Price 
                    --------- -------- --------- -------- --------- --------
Outstanding at
  January 1, 1997      94,965 $  11.01   125,000 $  10.48    88,000 $  10.39
Granted during 1997     -- --    -- --     -- --    -- --    27,000     8.76
Exercised during 1997   -- --    -- --     -- --    -- --     -- --    -- --
Forfeited during 1997 (27,095)   11.67   (21,500)   10.48   (11,000)   10.39
                    ---------          ---------          ---------
Outstanding at
  December 31, 1997    67,870    10.74   103,500    10.48   104,000     9.96
                    =========          =========          =========

All outstanding options were exercisable at December 31, 1997

   
                                                            1995 Directors
                    1985 Option Plan     1995 Option Plan     Option Plan
                    ----------------     ----------------   --------------
                              Weighted           Weighted           Weighted
                              Average            Average            Average  
                    Number of Exercise Number of Exercise Number of Exercise
                      Shares    Price    Shares    Price    Shares    Price 
                    --------- -------- --------- -------- --------- --------
Outstanding at
  January 1, 1996      96,965 $  10.99   102,000 $  10.31    80,000 $  10.31
Granted during 1996     -- --    -- --    24,000    11.19     8,000    11.13
Exercised during 1996   -- --    -- --     -- --    -- --     -- --    -- --
Forfeited during 1996  (2,000)   10.10    (1,000)   10.31     -- --    -- --
                    ---------          ---------          ---------
Outstanding at
  December 31, 1996    94,965    11.01   125,000    10.48    88,000    10.39
                    =========          =========          =========

All outstanding options were exercisable at December 31, 1996

Weighted average fair
value of options 
granted during 1996              N/A             $  11.19           $  11.13
                              ========           ========           ========
                                     
                                     27
The status of the options outstanding at December 31, 1997 is as follows:
                                                                 Remaining
                                           Exercise             Contractual
                                             Price    Number        Life
                                           --------  --------   -----------
                                           $  15.90    16,250     1.1 Years
                                              10.88    16,000     2.1 Years
                                               8.32    35,620     4.8 Years
                                              10.31   153,500     7.3 Years
                                              11.17    27,000     8.3 Years
                                               8.16    17,000     9.3 Years
                                               9.78    10,000     9.6 Years 


12.   Fair Value of Financial Instruments

The Corporation estimates that each category of financial instruments,
including cash, trade receivables and payables, investments and debt
instruments, approximate current value at December 31, 1997 and 1996.


13.   Discontinued Operations

On July 31, 1997 the Corporation sold substantially all of the former
consumer products business segment of the Corporation, identified as Melnor
Inc., including the stock of Melnor's wholly-owned subsidiary, Melnor Canada,
Ltd., to GH Acquisition Corp.  The Corporation received approximately $22.0
million in cash for the sale.  The cash received included funds in the amount
of $2.5 million designated for an escrow account.  Part or all of this escrow
account may be returned to the purchaser in the event future business 
operations of this business do not meet certain operating result thresholds.

The loss on disposal of the segment of $3,674,046 (net of income tax benefit
of $1,825,954) represented the loss from the disposal of substantially all
assets of the business along with expenses associated with the disposal
activities, including severance costs, professional fees and potential
variances in projected operations of the business during future fiscal periods.

Losses from the discontinued operations of this business are shown separately
in the accompanying income statements.  Income tax benefits applicable to
the years ended December 31, 1997, 1996 and 1995 were $428,489, $1,907,254
and $741,687, respectively.

Net sales for this business were $21,646,807 for the seven months ended July
31, 1997 and $40,145,222 and $40,267,676 for the years ended December 31,
1997 and 1996.  These amounts are excluded from net sales reported in the
accompanying income statements.











                                     28
14.   Supplemental Cash Flow Information

Supplemental Disclosure of Cash Flow Information

                                      1997          1996          1995
                                  ------------  ------------  ------------
    
   Cash payments for interest     $      8,482  $      2,976  $      5,202
                                  ============  ============  ============

   Cash payments for income taxes $  4,758,603  $  5,310,200  $  7,971,969
                                  ============  ============  ============

Supplemental Schedule of Noncash Investment Activities

 
In 1996, notes receivable of $654,794 were received as part of the proceeds
from the sale of property and equipment.


15.   Supplemental Financial Data (Unaudited)                           
                              Quarter Ended                        
           ---------------------------------------------------    1997
1997         March 31     June 30    September 30 December 31     Total
           ------------ ------------ ------------ ------------ ------------
Net sales  $ 40,463,805 $ 44,706,832 $ 38,828,516 $ 39,600,247 $163,599,400
Gross
profit     $  6,092,585 $  7,689,004 $  5,934,913 $  5,906,090 $ 25,622,592
Net income (loss)
from:
Continuing 
operations $  2,498,007 $  3,417,321 $  2,871,432 $     27,098 $  8,813,858
Discontinued
operations     (274,030)    (166,801)  (3,467,762)    (359,046)  (4,267,639)
           ------------ ------------ ------------ ------------ ------------
Net income
(loss)     $  2,223,977 $  3,250,520 $   (596,330)$   (331,948)$  4,546,219
           ------------ ------------ ------------ ------------ ------------ 
Earnings (loss) 
per share from:
Continuing 
operations $        .16 $        .22 $        .18 $      -- -- $        .56 
Discontinued 
operations         (.02)        (.01)        (.22)        (.02)        (.27)
           ------------ ------------ ------------ ------------ ------------
Earnings (loss)
per share  $        .14 $        .21 $       (.04)$       (.02)$        .29
           ------------ ------------ ------------ ------------ ------------
Dividends
declared   $        .08 $        .08 $        .08 $        .08 $        .32
Market price per
share:
High          10  3/4       9 11/16        11            11          11
Low            8            7 15/16         8 3/8         9 7/8       7 15/16




                                     29 
                              Quarter Ended
           ---------------------------------------------------    1996
1996         March 31     June 30    September 30  December 31    Total
           ------------ ------------ ------------ ------------ ------------
Net sales  $ 42,833,847 $ 47,846,657 $ 41,626,488 $ 38,911,495 $171,218,487
Gross
profit     $  9,359,678 $  8,387,369 $  6,692,264 $  6,599,171 $ 31,038,482
Net income (loss)
from:
Continuing
operations $  4,071,637 $  4,103,862 $  2,914,623 $  3,023,625 $ 14,113,747
Discontinued
operations      162,564      126,743   (1,367,924)  (2,305,637)  (3,384,254)
           ------------ ------------ ------------ ------------ ------------
Net income $  4,234,201 $  4,230,605 $  1,546,699 $    717,988 $ 10,729,493
           ------------ ------------ ------------ ------------ ------------
Earnings (loss)
per share from:
Continuing
operations $        .25 $        .25 $        .18 $        .19 $        .87
Discontinued 
operations          .01          .01         (.08)        (.15)        (.21)
           ------------ ------------ ------------ ------------ ------------
Earnings
per share  $        .26 $        .26 $        .10 $        .04 $        .66
           ------------ ------------ ------------ ------------ ------------
Dividends
declared   $        .08 $        .08 $        .08 $        .08 $        .32
Market price per
share:
High          11  1/4       12  3/4       12  1/8       11  3/4        12 3/4
Low            9  3/4       10  5/8       10  5/8       10              9 3/4


16.   Earnings Per Share

The following shows the weighted average number of shares used in computing
earnings per share and the effect on weighted average number of shares of
diluted potential common stock.
                                      1997          1996          1995
                                  ------------  ------------  ------------
Weighted average number of common
 shares used in earnings per
 common share                       15,758,205    16,169,162    16,503,877

Effect of dilutive securities:
 Stock options                           8,863        19,598        15,372
                                  ------------  ------------  ------------
Weighted average number of common 
 shares used in earnings per
 common share - assuming dilution   15,767,068    16,188,760    16,519,249
                                  ============  ============  ============

Options on approximately 222,750, 72,345 and 57,345 shares were not included
in computing earnings per common share - assuming dilution for the years
ended December 31, 1997, 1996 and 1995, respectively, because their effects
were antidilutive.

                                     30 
17.   New Accounting Pronouncements

During June, 1997 the Financial Accounting Standards Board issued Statement
No. 130, "Reporting Comprehensive Income".  This pronouncement establishes
standards for reporting and display of comprehensive income and its
components (revenue, expenses, gains and losses) in a full set of general
purpose financial statements.  Statement No. 130 is effective for financial
statements beginning after December 15, 1997.

Additionally during June of 1997, the Financial Accounting Standards Board
issued Statement No. 131, "Disclosure about Segments of an Enterprise and
Related Information."  Statement No. 131 establishes standards for the way
that public enterprises report information about operating segments in annual
financial statements and requires that those enterprises report selected
information about operating segments in interim financial reports issued to
stockholders.  It also establishes standards for related disclosures about
products and services, geographic areas and major customers.  This statement
becomes effective for financial statements for periods beginning after
December 31, 1997.  


  




































                                     31 




                        INDEPENDENT AUDITOR'S REPORT


To the Stockholders and Board of Directors
of O'Sullivan Corporation

We have audited the accompanying consolidated balance sheets of O'Sullivan
Corporation and Subsidiaries as of December 31, 1997 and 1996 and the related
consolidated statements of income, changes in stockholders' equity and cash
flows for the years ended December 31, 1997, 1996 and 1995.  These financial
statements are the responsibility of the Corporation's management.  Our
responsibility is to express an opinion on these financial statements based
on our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement.  An audit includes examining, on a test basis,
evidence supporting the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation.  We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of
O'Sullivan Corporation and Subsidiaries as of December 31, 1997 and 1996 and
the results of their operations and their cash flows for the years ended
December 31, 1997, 1996 and 1995 in conformity with generally accepted
accounting principles.


                                     /s/  YOUNT, HYDE & BARBOUR, P.C.

Winchester, Virginia
January 26, 1998



















                                     32
Item 9.        CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
                   AND FINANCIAL DISCLOSURE

None






















































                                     33 
                                  PART III


Item 10.        DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

For information with respect to the Corporation's Directors and Director
nominees, see pages 4  through 6 of the Corporation's definitive Proxy
Statement dated March 27, 1998 which pages are incorporated herein by
reference.  For information concerning the compliance by directors, officers
and beneficial owners of more than 10% of the Corporation's stock with the
requirement of Section 16(a) of the Securities Exchange Act of 1934, see
page 6  of the Corporation's Definitive Proxy Statement dated March 27,
1998, which page in incorporated herein by reference.

Executive Officers of the Registrant

The names, ages and positions of the executive officers of O'Sullivan
Corporation at December 31, 1997 are listed below.  All officers are elected
by the Board of Directors for a one year term.  There are no family
relationships among officers or any other arrangement or understanding
between any officer and any other person pursuant to which the officer was
elected.

                                                               Served As
         Name              Age              Office           Officer Since
---------------------     ----      ---------------------    -------------
James T. Holland           57       President                     1976
C. Bryant Nickerson        51       Secretary & Treasurer         1986
John S. Campbell           47       Vice President                1986

Mr. Holland has served in the following capacities for the Corporation;
Treasurer, 1976-1979, Vice President and Treasurer, 1979-1984, Executive Vice
President and Chief Operating Officer, 1984-1986,  President and Chief
Operating Officer, 1986-1995, President and Chief Executive Officer, 1995 to
the Present.

Mr. Nickerson has been employed by the Corporation since 1973 serving in
various capacities within the corporate financial area.  He has served as
Controller and Treasurer and Chief Accounting Officer before being elected
as Secretary, Treasurer and Chief Financial Officer in 1995.

Mr. John S. Campbell has served as a Vice President since 1986.  He has been
employed by the Corporation since 1973 and has been involved in both the
sales and manufacturing operations of the calendered plastics products
business of the Corporation.


Other Officers of the Registrant
                                                               Served As
         Name              Age              Office           Officer Since
---------------------     ----      ---------------------    -------------
William O. Bauserman       54       Vice President                1987
Ewen A. Campbell           50       Vice President                1993
John P. Crowther           47       Vice President                1998
James L. Tremoulis         44       Vice President                1986
Robert C. Westfall         55       Vice President                1979


                                     34
Mr. Bauserman has been employed by the Corporation since 1968 and has served
as a Vice President since 1987.  Mr. Bauserman has been employed in various
capacities within the data processing and management information services
areas during his tenure with the Corporation.

Mr. Ewen A. Campbell has an extensive background in chemistry and plastics
compounding.  He has been employed by the Corporation since 1991 in the areas
of compounding and research and development activities.  He has served as a
Vice President since 1993.  Mr. Ewen Campbell and Mr. John Campbell are not
related.

Mr. Crowther has been employed by the Corporation since 1995 as a sales
representative to automotive-related customers of the Corporation.  Prior to
that time he was employed by a business that served as a manufacturer's
representative to the automotive industry for the Corporation.  He was
elected as a Vice President in January, 1998.   

Mr. Tremoulis has served in various capacities in the sales area for
calendered plastics products since his employment by the Corporation in 1980.
He was elected as a Vice President in 1986.

Mr. Westfall has been employed by the Corporation since 1965.  He was a
chemist, the Quality Control Director and a Plant Manager for the Corporation
prior to being elected as a Vice President of Research and Development in
1979.


Item 11.        EXECUTIVE COMPENSATION

See Pages 7 through 13 of the Corporation's Proxy Statement dated March 27,
1998, which pages are incorporated herein by reference.


Item 12.        SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
                      MANAGEMENT

See Pages 3 through 6 of the Corporation's Proxy Statement dated March 27,
1998, which pages are incorporated herein by reference.


Item 13.        CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

There were no transactions during 1997 that would be applicable for
disclosure under this item.














                                     35
                                  PART IV


Item 14.        EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM
                      8-K

(a).    (1)     Financial Statements                                   Page

                Included in Part II, Item 8, of this report:
 
                Report of Independent Auditors                          32

                Consolidated Balance Sheets at December 31, 1997
                  and 1996                                              10

                Consolidated Statements of Income for the Years
                  Ended December 31, 1997, 1996 and 1995                11

                Consolidated Statements of Cash Flows for the
                  Years Ended December 31, 1997, 1996 and 1995        12-13 

                Consolidated Statements of Changes in
                  Stockholders' Equity for the Years Ended
                  December 31, 1997, 1996 and 1995                    14-15

                Notes to Consolidated Financial Statements            16-31


(a).   (2)      Financial Statement Schedules

                Included in Part IV of this report:

                Report of Independent Auditors on Financial
                  Statement Schedule                                    39

                Schedule II - Valuation and Qualifying Accounts
                  and Reserves for the Years Ended December 31,
                  1997, 1996 and 1995                                   40

(a).   (3)      Exhibits

                3.1   O'Sullivan Corporation Amended and Restated
                      Articles of Incorporation, including the
                      Articles of Amendment, dated April 30, 1985,
                      filed with the State Corporation Commission
                      of Virginia on May 6, 1985, adopted by
                      stockholders of O'Sullivan Corporation at
                      the annual meeting held April 30, 1985.
                      (Incorporated by reference to the March 31,
                      1985, Quarterly Report on Form 10-Q of the
                      Corporation.)

                3.2   O'Sullivan Corporation Bylaws as amended to
                      January 29, 1985.  (Incorporated by reference
                      to the March 31, 1985, Quarterly Report on
                      Form 10-Q of the Corporation.)

                
                                     36
Item 14.        EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM
                      8-K (continued)

                                                                       Page
                3.3   O'Sullivan Corporation Amended and Restated
                      Articles of Incorporation dated April 29, 1989,
                      filed with the State Corporation Commission 
                      dated April 29, 1989, adopted by stockholders of
                      O'Sullivan Corporation at the annual meeting
                      held April 25, 1989.  (Incorporated by reference
                      to the March 31, 1989 Quarterly Report on Form
                      10-Q of the Corporation.)

                3.4   O'Sullivan Corporation Bylaws as amended to 
                      January 26, 1998. - filed herewith

                10.1  Compensatory arrangement with executive officers
                      of the registrant.  See Pages 7  through 13 of 
                      the Corporation's Proxy Statement dated March 27,
                      1998 which pages are incorporated herein by 
                      reference.

                10.2  Form of Employment Continuity Agreement between the 
                      Registrant and James T. Holland, John S. Campbell,
                      C.  Bryant Nickerson, William O. Bauserman, Ewen A.
                      Campbell, Dee S. Johnston, Michael M. Meissner,
                      James L. Tremoulis and Robert C. Westfall.  
                      (Incorporated by reference to the Annual Report on
                      Form 10-K for the Year Ended December 31, 1996.)

                10.3  The O'Sullivan Corporation 1995 Stock Option Plan
                      filed as exhibit 99.1 to the Corporation's Form 
                      S-8 registration statement (Registration Number
                      033-58895) filed with the Commission on April 28,
                      1995 and incorporated herein by reference.

                10.4  The O'Sullivan Corporation 1995 Outside Directors 
                      Stock Option Plan filed as exhibit 99.2 to the   
                      Corporation's Form S-8 registration statement   
                      (Registration Number 033-58895) filed with the    
                      Commission on April 28, 1995 and incorporated     
                      herein by reference.

                10.5  1985 Incentive Stock Option Plan.  Amended and
                      Restated as of July 27, 1993.  (Incorporated by 
                      reference to the Annual report on Form 10-K for 
                      the Year Ended December 31, 1994.)

                10.6  Severance Agreement between O'Sullivan Corporation
                      and James T. Holland, President and Chief Executive
                      Officer. - filed herewith

                21.   Subsidiaries of the Registrant - filed herewith

                23.   Consent of Independent Auditors - filed herewith

                24.   Powers of Attorney - filed herewith

                                     37
Item 14.        EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM
                      8-K (Continued)

                                                                       Page
                27.   Financial Data Schedule - filed herewith

                     
(b).            Reports on Form 8-K

                There were no reports filed on Form 8-K for the quarter
                ended December 31, 1997.

(c).            Index to Exhibits                                       43 













































                                     38




                        INDEPENDENT AUDITOR'S REPORT
                      ON FINANCIAL STATEMENT SCHEDULE


To the Stockholders and Board of Directors
of the O'Sullivan Corporation

The examination referred to in our opinion dated January 26, 1998 of the
consolidated financial statements as of December 31, 1997 and 1996 and for
the three years ended December 31, 1997, 1996 and 1995 included the related
supplemental financial schedule as listed in Item 14(a) 2, which, when
considered in relation to the basis financial statements, present fairly in
all material respects the information shown therein.

                                          /s/  YOUNT, HYDE & BARBOUR, P.C.







































                                     39
                O'SULLIVAN CORPORATION AND SUBSIDIARIES      Schedule II
                   VALUATION AND QUALIFYING ACCOUNTS
             Years Ended December 31, 1997, 1996 and 1995

 Column A   Column B          Column C           Column D      Column E
---------- ---------- ------------------------ -----------   -----------
                              Additions
                      ------------------------
                         (1)          (2)
             Balance   Charged      Charged                     Balance 
                at     to Costs       to                          at
            Beginning    and         Other      Recoveries        End
Description  of Year   Expense      Accounts   (Deductions)     of Year
---------- ---------- ----------  ------------ ------------   -----------
1997:
 Allowance
  for
  Doubtful
  Accounts $  573,769 $    -- --  $     -- --  $    (3,619)(A)$   570,150
           ========== ==========  ===========  ===========    ===========
1996:
 Allowance
  for 
  Doubtful
  Accounts $  470,684 $   77,000  $     -- --  $    26,085 (A)$   573,769
           ========== ==========  ===========  ===========    ===========
1995:
 Allowance
  for 
  Doubtful
  Accounts $  402,713 $  275,000  $     -- --  $  (207,029)(A)$   470,684
           ========== ==========  ===========  ===========    ===========

Note (A) - Write-offs of uncollectible accounts, net of recoveries.  
            























                                     40
                                SIGNATURES

Pursuant to the requirement of Section 13 or 15(d) 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.


March 26, 1998                            O'SULLIVAN CORPORATION
--------------                            By: /s/ C. Bryant Nickerson
    Date                                  ---------------------------
                                          C. Bryant Nickerson
                                          Secretary, Treasurer and 
                                          Chief Financial Officer


Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed by the following persons on behalf of the Registrant
and in the capacities indicated on the dates given.


Arthur H. Bryant, II *                                    March 26, 1998
------------------------                                  --------------
Arthur H. Bryant, II        Chairman and Director              Date

/s/ James T. Holland                                      March 26, 1998
------------------------                                  --------------
James T. Holland            President, Chief Executive         Date
                            Officer and Director

/s/ C. Bryant Nickerson                                   March 26, 1998
------------------------                                  --------------
C. Bryant Nickerson         Secretary, Treasurer and           Date 
                            Chief Financial Officer
                          
C. Hugh Bloom *                                           March 26, 1998
------------------------                                  --------------
C. Hugh Bloom               Director                           Date

Magalen O. Bryant *                                       March 26, 1998
------------------------                                  --------------
Magalen O. Bryant           Director                           Date

Robert L. Burrus, Jr. *                                   March 26, 1998
------------------------                                  --------------
Robert L. Burrus, Jr.       Director                           Date

Max C. Chapman, Jr. *                                     March 26, 1998
------------------------                                  --------------
Max C. Chapman, Jr.         Director                           Date

R. Michael McCullough *                                   March 26, 1998
------------------------                                  --------------
R. Michael McCullough       Director                           Date

Stephen P. Munn *                                         March 26, 1998
------------------------                                  --------------
Stephen P. Munn             Director                           Date

                                     41
Timothy J. Sandker *                                      March 26, 1998
------------------------                                  --------------
Timothy J. Sandker          Director                           Date

Leighton W. Smith  *                                      March 26, 1998
------------------------                                  --------------
Leighton W. Smith           Director                           Date


                      *  By:  /s/ James T. Holland
                              ---------------------
                              James T. Holland
                              Attorney-In-Fact













































                                     42
                                EXHIBIT INDEX

                                                                     Page
                3.4      O'Sullivan Corporation Bylaws Amended
                         to January 26, 1998                         44-51

               10.6      Severance Agreement between O'Sullivan 
                         Corporation and James T. Holland, 
                         President and Chief Executive Officer       52-55

               21.       Subsidiaries of the Registrant               56

               23.       Consent of Experts                           57

               24.       Powers of Attorney                          58-66

               27.       Financial Data Schedule                      67
                           








































                                     43