SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549

                                    FORM 10-K

                     ANNUAL REPORT PURSUANT TO SECTION 13 OR
                  15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 1997        Commission File Number 1-2451

                        NATIONAL PRESTO INDUSTRIES, INC.
             (Exact name of registrant as specified in its charter)

            Wisconsin                                     39-0494170
  (State or other jurisdiction of                       (IRS Employer
   incorporation or organization)                   Identification Number)

                             3925 North Hastings Way
                        Eau Claire, Wisconsin 54703-3703
               (Address of principal executive offices) (Zip Code)

       Registrant's telephone number, including area code: (715) 839-2121

Securities registered pursuant to Section 12(b) of the Act:

                                                        Name of each exchange on
    Title of each class                                      which registered
$1.00 par value common stock                             New York 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 (229.405 of this chapter) 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 the Form 10-K. _X__

The aggregate market value of the voting stock held by non-affiliates of the
registrant computed by reference to the price at which the stock was sold, or
the average bid and asked prices of such stock, as of February 27, 1998, was
$279,516,348.

The number of shares outstanding of each of the registrant's classes of common
stock, as of February 27, 1998, was 7,354,981.

<PAGE>


                       DOCUMENTS INCORPORATED BY REFERENCE

The following documents are incorporated by reference into that part of this
Form 10-K designated to the right of the document title.

             TITLE                                           PART

Proxy Statement dated April 3, 1998                        Part III

Except as specifically incorporated herein by reference, the foregoing Proxy
Statement is not deemed filed as part of this report.

<PAGE>


                                     PART I


ITEM 1. BUSINESS

      A.  DESCRIPTION OF BUSINESS

         The business of National Presto Industries, Inc., and its consolidated
         subsidiaries (the "Company") consists of a single business category.
         Comments on individual portions of that category follow.

         1.  COMMERCIAL

         The Company manufactures and distributes small electrical appliances
         and housewares, including comfort appliances, pressure cookers and
         canners, private label and premium sales products.

         Electrical appliances and housewares sold by the Company include
         pressure cookers and canners; the Presto(R) Control Master(R) single
         thermostatic control line of fry pans in several sizes, griddles and
         combination griddle/warmers and multi-purpose cookers; deep fryers of
         various sizes; can openers, slicer/shredders, slicer/shredder/mixers;
         electric heaters; corn poppers (hot air and microwave); microwave bacon
         cookers; electronic toasters; coffeemakers; electric grills; electric
         tea kettles; electric knives; bread slicing systems; electric knife
         sharpeners; and timers.

         Pressure cookers and canners are available in various sizes and are
         fabricated of aluminum and, in the case of cookers, of stainless steel.
         The Company believes it is one of the principal manufacturers of
         pressure cookers in the United States.

         For the year ended December 31, 1997, approximately 56% of consolidated
         net sales were provided by cast products (fry pans, griddles, deep
         fryers and electric multi-cookers), approximately 15% by motorized
         nonthermal appliances (can openers, slicer/shredders, knife sharpeners,
         electric knives, and bread slicing systems), and approximately 25% by
         noncast/thermal appliances (stamped cookers and canners, stainless
         steel cookers, electronic toasters, corn poppers (hot air and
         microwave), coffeemakers, microwave bacon cookers, tea kettles, and
         heaters). For the year ended December 31, 1996, approximately 52% of
         consolidated net sales were provided by cast products, approximately
         15% by motorized nonthermal appliances and approximately 28% by
         noncast/thermal appliances. For the year ended December 31, 1995,
         approximately 45% of consolidated net sales were provided by cast
         products, approximately 22% by motorized nonthermal appliances and
         approximately 29% by noncast/thermal appliances.

         Wal-Mart Stores, Inc., accounted for 43%, 38% and 36% of consolidated
         net sales for the years ended December 31, 1997, 1996 and 1995.

         Products are sold directly to retailers throughout the United States
         and also through independent distributors. Although the Company has
         long established relationships with many of its customers, it does not
         have long-term supply contracts with them. The loss of, or material
         reduction in, business from any of the Company's major customers could
         adversely affect the Company's business.


<PAGE>



         The Company has a sales force of approximately eleven employees that
         sells to and services customers. In selected geographic areas sales are
         handled by manufacturers' representatives who may handle other product
         lines. Sales promotional activities include television, radio and
         newspaper. The Company's commercial business is highly competitive and
         seasonal, with the normal peak sales period occurring in the fourth
         quarter of the year prior to the holiday season. Many companies compete
         for sales of housewares and small appliances, some of which are larger
         than the Company and others which are smaller. Product competition
         extends to special product features, product pricing, marketing
         programs, warranty provisions, service policies and other factors. New
         product introductions are an important part of the Company's sales to
         offset the morbidity rate of other products and/or the effect of
         lowered acceptance of seasonal products due to weather conditions. New
         products entail unusual risks. Engineering and tooling costs are
         increasingly expensive, as are components and finished goods that may
         not have a ready market or achieve widespread consumer acceptance.
         High-cost advertising commitments accompanying such new products or to
         maintain sales of existing products may not be fully absorbed by
         ultimate product sales. Initial production schedules, set in advance of
         introduction, carry the possibility of excess unsold inventories. New
         product introductions are further subject to delivery delays from
         supply sources, which can impact availability for the Company's most
         active selling periods.

         Research and development costs related to new product development for
         the years 1997, 1996 and 1995 were absorbed in operations for these
         years and were not a material element in the aggregate costs incurred
         by the Company.

         Company products are generally warranted to the original owner to be
         free from defects in material and workmanship for a period of two years
         from date of purchase. The Company allows a sixty-day over-the-counter
         initial return privilege through cooperating dealers. The Company
         services its products through independent service stations throughout
         the United States and the corporate service repair operation. The
         Company's service and warranty programs are competitive with those
         offered by other manufacturers in the industry.

         The Company's commercial products are manufactured in plants located at
         Jackson, Mississippi and Alamogordo, New Mexico. The Company also
         purchases a portion (18% in 1997) of its products from nonaffiliated
         companies in the Pacific Rim countries.

         2.  DEFENSE

         The Company commenced defense production in 1942. From 1966 through
         1980, 105MM projectiles were produced in the Eau Claire facility
         (utilizing Government owned equipment in Company owned buildings).
         Production of 8" projectiles also occurred intermittently during this
         period. Since completion of production in 1980, standby contracts had
         been received and renewed on an annual basis through September, 1992.
         For the period October, 1992 through September, 1993 a storage only
         contract was received. In September, 1993, the Department of the Army
         exercised its option of abandoning, in place, the production equipment
         formerly utilized for projectile fabrication. This equipment has been
         sold, a portion of the facility has been restored and is being leased
         for manufacturing purposes, and work is continuing to restore the
         balance of the plant for manufacturing, or other purposes.

         See Section B3 for comments regarding Defense related Environmental
         Protection Agency matters.

<PAGE>


         3.  WAREHOUSING AND TRANSPORTATION SERVICES

         For a number of years, the Company has warehoused and distributed its
         commercial products from a centrally located distribution center.
         Selective use is made of leased tractors and trailers with backhauls
         scheduled on return trips carrying goods consigned for internal
         corporate use.

         4.  FINANCIAL MANAGEMENT

         A separate subsidiary of the Company, a Delaware holding company, is
         responsible for the management of funds not currently required for
         business activities and, therefore, temporarily available for
         investments. (See Footnote B(3) in the Notes to Consolidated Financial
         Statements.) Income from financial management activities is included in
         Other Income in the accompanying financial statements.

         Earnings for this subsidiary may vary significantly from year to year
         depending on interest yields on instruments meeting the Company's
         investment criteria, and the extent to which funds may be needed for
         internal growth and newly identified business activities.

       B.  OTHER COMMENTS

         1.  Sources and Availability of Materials

         Production levels at commercial plants may be affected by vendor
         failure to deliver tooling, material and critical parts within
         commitments. While recent years have witnessed virtual elimination of
         these circumstances, there is no assurance against recurrence.

         Deliveries of new products, many of which have been sourced overseas,
         could be delayed by labor or supply problems at vendors or in
         transportation. As a consequence, these products may not be available
         in sufficient quantities during the prime selling period. While there
         has been no major incidence of such problems recently and the Company
         has made every reasonable effort to prevent occurrence, there is no
         assurance that such effort will be totally effective.

         2.  Trademarks, Licenses, Franchises and Concessions Held

         In recent years, patents on new products have become more meaningful to
         operating results. Trademarks and know-how are considered significant.
         The Company's current and future success depends upon judicial
         protection of its intellectual property rights ( patents, trademarks
         and trade dress). Removal of that protection would expose the Company
         to competitors who seek to take advantage of the Company's innovations
         and proprietary rights. To date, the Company has vigorously protected
         its rights and enjoyed success in all its intellectual property suits.

<PAGE>


         3. Effects of Compliance with Environmental and OSHA Regulations

         In May 1986, the Company's Eau Claire, Wisconsin, site was placed on
         the United States Environmental Protection Agency's (EPA) National
         Priorities List (NPL) under the Comprehensive Environmental Reponse,
         Compensation and Liability Act of 1980 (CERCLA) because of alleged
         hazardous waste deposited on the property. During July 1986, the
         Company entered into an agreement with the EPA and the Wisconsin
         Department of Natural Resources to conduct a remedial investigation and
         feasibility study at the site. The remedial investigation was completed
         in 1992, the feasibility study in 1994, and in May 1996 the final
         record of decision (ROD) was issued for the site by the EPA. Some
         remedial activities have already been completed, some previously
         initiated are continuing, and others are in the early stages of
         implementation.

         In February 1988, the Company entered into an agreement with the
         Department of the Army (the 1988 Agreement), pursuant to which the Army
         agreed to fund environmental restoration activities related to the
         site. As a result of the 1988 Agreement, a total of $27,000,000 has
         been appropriated for environmental matters. Based on information known
         to the Company as of December 31, 1997, it is believed that the funds
         appropriated to date will be adequate to satisfy remaining
         investigation and restoration activities; however, should environmental
         agencies require additional studies or remediation activities beyond
         what is now contemplated, it is possible that existing funds could be
         inadequate.

         Management believes that in the absence of any unforeseen future
         developments, these environmental matters will not have any material
         adverse effect on the results of operations or financial condition of
         the Company.

         4.  Number of Employees of the Company

         As of December 31, 1997, the Company had 577 employees.

         5.  Industry Practices Related to Working Capital Requirements

         The major portion of the Company's commercial sales were made with
         terms of 90 days or shorter. A small portion of the sales were made
         with seasonal dating provisions.

         Inventory levels increase in advance of the selling period for products
         that are seasonal, such as pressure canners, heaters, and in
         preparation for new product introductions. Inventory build-up also
         occurs to create stock levels required to support the higher sales that
         occur in the latter half of each year. With the buying practices of the
         Company's customers moving away from substantial advance stocking
         orders to smaller, more frequent orders, the Company is required to
         carry larger finished goods inventories than previously maintained. The
         Company purchases components and raw materials in advance of production
         requirements where such purchases are required to ensure supply or
         provide advantageous long-term pricing.


<PAGE>



         6.  Backlog

         Shipment of most of the Company's commercial products occurs within a
         relatively short time after receipt of the order and, therefore, there
         is usually no substantial order backlog. New product introductions do
         result in order backlogs that vary from product to product and as to
         timing of introduction.

      C. INDUSTRY SEGMENTS

         The Company operates in one business segment.


ITEM 2.PROPERTIES (Owned Except Where Indicated)

         The Company's Eau Claire facility is approximately 560,000 square feet,
         of which 428,000 square feet was dedicated to ordnance activities prior
         to September 1993. Leases for 145,000 square feet of this area have
         been entered into with outside tenants. The Company's corporate office
         is also located in Eau Claire.

         The Company manufactures consumer products in Jackson, Mississippi and
         Alamogordo, New Mexico.

         The Jackson plant contains 283,000 square feet, of which 119,600 square
         feet is used for warehousing.

         The facility at Alamogordo contains 163,200 square feet, of which
         24,800 square feet is used for warehousing.

         The Company has a 162,400 square foot building at Canton, Mississippi
         which is used primarily for warehousing and distribution and some
         activities for product service functions. An additional 24,000 square
         feet has been leased in adjacent buildings for storage area. During
         peak season, an additional 80,000 square feet has been leased.


ITEM 3.LEGAL PROCEEDINGS

         The Company is subject to various legal actions incidental to its
         normal business operations. In the opinion of management such actions
         will be resolved for amounts that in the aggregate will not be material
         to the results of operations or financial condition of the Company.

         See Item 1.B.3. for information regarding certain environmental
         matters.


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

         None


<PAGE>



                      EXECUTIVE OFFICERS OF THE REGISTRANT


The following information is provided with regard to the executive officers of
the registrant: (All terms of office are for one year or until their respective
successors are duly elected and qualified.)


<TABLE>
<CAPTION>

                                                                                   FAMILY
          NAME                         TITLE                        AGE            RELATIONSHIP
         --------------------------------------------------------------------------------------------------------

<S>                            <C>                                   <C>        <C>              
         Melvin S. Cohen       Chairman of the Board                 80              Father of
                                                                                   Maryjo Cohen

         Maryjo Cohen          President and Chief Executive         45             Daughter of
                               Officer                                            Melvin S. Cohen

         Richard F. Anderl     Vice-President, Engineering           54                None
                                                                                    
         Neil L. Brown         Vice President, Manufacturing         54                None
                                                                                    
         Donald E. Hoeschen    Vice-President, Sales                 50                None
                                                                                    
         James F. Bartl        Secretary                             57                None
                                                                                    
         Randy F. Lieble       Treasurer                             44                None
                                                                                  
</TABLE>

         Mr. Cohen was elected Chairman of the Board in May 1975. Prior to that
         date he was President, a position that he again held from November 1986
         to May 1989.

         Ms. Cohen was elected Treasurer in September 1983, to the additional
         positions of Vice-President in May 1986, President in May 1989 and
         Chief Executive Officer in May 1994. She has been associated with the
         registrant since 1976. Prior to becoming an officer, she was Associate
         Resident Counsel and Assistant to the Treasurer.

         Mr. Anderl was elected Vice-President in May 1989. He has been
         associated with the registrant since 1963 and prior to becoming an
         officer, he was Director of Engineering.

         Mr. Brown was elected Vice-President in November 1997. He has been
         associated with the registrant since 1966. Prior to becoming an
         officer, he was Director of Manufacturing.

         Mr. Hoeschen was elected Vice President in May 1997. He has been
         associated with the registrant since 1971. Prior to becoming an
         officer, he was Director of Sales.

         Mr. Bartl was elected Secretary in May 1978. He has been associated
         with the registrant since 1969. Prior to becoming an officer, he was
         Resident Counsel and Director of Industrial Relations, positions he
         continues to hold.

         Mr. Lieble was elected Treasurer in November 1995. He has been
         associated with the registrant since 1977. Prior to becoming an
         officer, he was Manager of Investments and Government Contracts.



<PAGE>



                                     PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

<TABLE>
<CAPTION>
            Record of Dividends Paid and Market Price of Common Stock

                                    1997 Fiscal Year                               1996 Fiscal Year
                            ---------------------------------------------------------------------------------------
                              Applicable         Market Price               Applicable          Market Price
                            Dividends Paid                                Dividends Paid
                              per Share         High        Low              per Share        High           Low
                            -------------------------------------         ------------------------------------------
<S>                            <C>             <C>        <C>                  <C>             <C>          <C>
First Quarter                  $2.00           $40 1/2    $35 7/8              $2.00           $44          $39 5/8
Second Quarter                   -              40 3/8     35 7/8                -              42           38
Third Quarter                    -              43         36 3/4                -              39 1/2       36 1/4
Fourth Quarter                   -              44 3/16    36 1/2                -              38 7/8       36 1/2
                            -------------------------------------         ------------------------------------------
Full Year                      $2.00           $44 3/16   $35 7/8              $2.00           $44          $36 1/4

</TABLE>

         Common stock of National Presto Industries, Inc., is traded on the New
York Stock Exchange under the symbol NPK. As of December 31, 1997, there were
953 stockholders of record. There were 940 stockholders of record as of February
27, 1998, the latest practicable date.


ITEM 6. SELECTED FINANCIAL DATA

(In thousands except per share data)
<TABLE>
<CAPTION>

For the years ended December 31,       1997         1996         1995         1994         1993
                                     --------     --------     --------     --------     --------
<S>                                  <C>          <C>          <C>          <C>          <C>     
Net sales                            $109,540     $106,008     $120,172     $128,070     $118,580

Net earnings                           16,982       14,720       18,969       21,455       18,655

Net earnings per share - Diluted         2.31         2.00         2.61         2.92         2.55

Total assets                          291,870      285,385      284,927      291,036      283,004

Long-term debt                           --           --           --          5,103        5,103
                                     --------     --------     --------     --------     --------

Dividends paid per common share
   Applicable to current year            2.00         2.00         2.15         1.90            *

</TABLE>


*  The 1993 dividend was paid on December 28, 1992.

<PAGE>



ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATION

1997 COMPARED TO 1996

Net sales increased by $3,532,000 from $106,008,000 to $109,540,000 due to
increased unit volume primarily as a result of new product introductions.

Gross margins for 1997 increased $1,886,000 from $33,621,000 to $35,507,000 due
to the volume increase. As a percentage of sales, gross margins were 32% in both
years.

Selling and general expenses were relatively unchanged.

Other income, principally interest, increased from the 1996 level primarily as a
result of a higher rate of return on a higher level of invested funds in the
Company's portfolio of short-term marketable securities.

Both years were favorably impacted by litigation judgments/settlements of a
nonrecurring nature.

Earnings before provision for income taxes increased $2,816,000 from $19,174,000
to $21,990,000. The provision for income taxes increased from $4,454,000 to
$5,008,000 as a result of increased earnings subject to tax. The effective
income tax rate was 23% in both years. Net earnings increased $2,262,000 from
$14,720,000 to $16,982,000, or 15%.

National Presto Industries, Inc. has studied its computer software and hardware
to determine its exposure to the Century date problem. The year 2000 date
problem consists of a date format shortcoming where the year is represented by
only two digits causing programs that perform arithmetic operations,
comparisons, or sorting of date fields to yield incorrect results. The work to
correct the year 2000 problem began in 1997 and is expected to be completed in
12 to 16 months. The cost, which is considered immaterial, will be directly
reflected in the Statement of Earnings as incurred.

The Company maintains adequate liquidity for all of its anticipated capital
requirements and dividend payments. As of year-end 1997, there were no material
capital commitments outstanding.

Forward looking statements in this Annual Report are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995. There
are certain important factors that could cause results to differ materially from
those anticipated by some of the statements made above. Investors are cautioned
that all forward looking statements involve risks and uncertainty. In addition
to the factors discussed above, among the other factors that could cause actual
results to differ materially are the following: consumer spending and debt
levels; interest rates; continuity of relationships with and purchases by major
customers; product mix; competitive pressure on sales and pricing, and increases
in material or production cost which cannot be recouped in product pricing.
Additional information concerning those and other factors is contained in the
Company's Securities and Exchange Commission filings, including but not limited
to the Form 10-K, copies of which are available from the Company without charge.



<PAGE>



ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATION (Continued)

1996 COMPARED TO 1995

Net sales decreased by $14,164,000 from $120,172,000 to $106,008,000, primarily
due to a unit volume decrease.

Gross profit for 1996 decreased by $9,175,000 from $42,796,000 to $33,621,000
due primarily to the volume reduction and a less favorable product mix. See
footnote C to the consolidated financial statements for information on LIFO
valuing of inventories and its impact on cost of sales. Gross margins as a
percentage of sales were 32% versus 36% in 1996 and 1995.

Selling and general expenses decreased $4,384,000 largely due to decreased
advertising expenses. As a percentage of net sales, selling and general expenses
decreased from 23% to 22%.

Other income, principally interest, decreased from the 1995 level primarily as a
result of a lower rate of return on the Company's portfolio of short-term
marketable securities.

The other, principally litigation judgment in 1996 was income from concluded
legal matters and 1995, was the result of a non-operational receipt of $2.85
million in damages and interest resulting from the Federal Circuit Court of
Appeals decision that Black & Decker infringed Presto's patent on its
SaladShooter(R) electric slicer/shredder. It was offset in part by the cost of
retiring a Convertible Debenture.

Earnings before provision for income taxes decreased $6,229,000 from $25,403,000
to $19,174,000. The provision for income taxes decreased from $6,434,000 to
$4,454,000, which resulted in an effective income tax rate decrease from 25% to
23%, as a result of decreased earnings subject to tax. Net earnings decreased
$4,249,000 from $18,969,000 to $14,720,000, or 22%.


<PAGE>



ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

         A.  The consolidated financial statements of National Presto
             Industries, Inc. and its subsidiaries and the related Report of
             Independent Certified Public Accountants are contained on pages F-1
             through F-11 of this report.

         B.  Quarterly financial data is contained in Note L in Notes to
             Consolidated Financial Statements.



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

             None


                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

         A listing of the Executive Officers of the Registrant is included in
         Part I. See Note following Item 13 for information relating to
         Directors of the Company.

ITEM 11. EXECUTIVE COMPENSATION

         See Note following Item 13.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         See Note following Item 13.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         See Note following.

NOTE: Within 120 days after the close of the registrant's fiscal year ended
December 31, 1997, the registrant intends to file a definitive proxy statement
pursuant to regulation 14A. Pursuant to the Rules and Regulations of the
Securities Exchange Act of 1934, the information required for Items 10, 11, 12
and 13 has been omitted and is incorporated herein from the Proxy by reference.

<PAGE>


                                     PART IV

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

    A.  The following consolidated financial statements of National Presto
        Industries, Inc., and its subsidiaries and the related Report of
        Independent Certified Public Accountants are included in this report:

<TABLE>
<CAPTION>

                                                                                Form 10-K
                                                                              Page Reference
                                                                              --------------

       <S>                                                                      <C>
       1. Consolidated Balance Sheets - December 31, 1997 and 1996               F-1 & F-2

       2. Consolidated Statements of Earnings -
            Years ended December 31, 1997, 1996 and 1995                           F-3

       3. Consolidated Statements of Cash Flows -
            Years ended December 31, 1997, 1996 and 1995                           F-4

       4. Consolidated Statements of Stockholders' Equity -
            Years ended December 31, 1997, 1996 and 1995                           F-5

       5. Notes to Consolidated Financial Statements                            F-6 thru F-10

       6. Report of Independent Certified Public Accountants                       F-11



    B.  The following Schedules and Exhibits are included in this report:

           Schedule II - Valuation and Qualifying Accounts                         F-12

          Exhibit 3(i) - Restated Articles of Incorporation - incorporated by
                        reference from Exhibit 3 (i) of the Company's quarterly
                        report on Form 10-Q for the quarter ended July 6, 1997

                  (ii) - By-Laws - incorporated by reference from Exhibit 3
                        (ii) of the Company's quarterly report on Form 10-Q for
                        the quarter ended July 6, 1997

          Exhibit 9    - Voting Trust Agreement - incorporated by reference
                        from Exhibit 9 of the Company's quarterly report on Form
                        10-Q for the quarter ended July 6, 1997

          Exhibit 10.1 - 1988 Stock Option Plan - incorporated by reference
                        from Exhibit 10.1 of the Company's quarterly report on
                        Form 10-Q for the quarter ended July 6, 1997

          Exhibit 10.2 - Form of Incentive Stock Option Agreement under the
                        1988 Stock Option Plan - Incorporated by reference from
                        Exhibit 10.2 of the Company's quarterly report on Form
                        10-Q for the quarter ended July 6, 1997


          Exhibit 11   - Statement Re Computation of Per Share Earnings            F-13

<PAGE>

          Exhibit 21 - Parent and Subsidiaries                                     F-14

          Exhibit 23.1 - Consent of Grant Thornton LLP                             F-15

          Exhibit 27 - Financial Data Schedule                                     F-16
</TABLE>

All other Schedules and Exhibits for which provision is made in the applicable
accounting regulations of the Securities and Exchange Commission are not
required under the related instructions or are inapplicable, and therefore have
been omitted. Columns omitted from schedules filed have been omitted because the
information is not applicable.

<PAGE>

                                    SIGNATURE


Pursuant to the Requirements of Section 13 or 14 (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.


                        NATIONAL PRESTO INDUSTRIES, INC.
                        --------------------------------
                                  (registrant)




                                       By: /S/Randy F. Lieble
                                           ---------------------------
                                              Randy F. Lieble
                                              Treasurer
                                              (Principal Accounting Officer)


By: /S/ Walter G. Ryberg               By: /S/ Melvin S. Cohen
    ---------------------------            ---------------------------
        Walter G. Ryberg                       Melvin S. Cohen
        Director                               Chairman of the Board


By: /S/ John M. Sirianni               By: /S/ James F. Bartl
    ---------------------------            ---------------------------
        John M. Sirianni                       James F. Bartl
        Director                               Secretary and Director


By: /S/ Michael J. O'Meara             By: /S/ Maryjo Cohen
    ---------------------------            ---------------------------
        Michael J. O'Meara                     Maryjo Cohen
        Director                               President and Chief Executive
                                               Officer and Director



Date:  March 25, 1998

<PAGE>

<TABLE>
<CAPTION>


NATIONAL PRESTO INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
                                                           DECEMBER 31, 1997                           DECEMBER 31, 1996
------------------------------------------------------------------------------------------------------------------------
<S>                                                           <C>             <C>               <C>            <C>  
ASSETS

     CURRENT ASSETS:

         Cash and cash equivalents                                         $ 91,639                             $ 91,878

         Marketable securities                                              140,651                              136,159

         Accounts receivable                                $ 20,692                             $22,276

            Less allowance for doubtful accounts                 450         20,242                  450          21,826
                                                            --------                             -------

         Inventories:

            Finished goods                                     9,058                               8,470

            Work in process                                    1,675                               1,744

            Raw materials                                      6,900                               6,661

            Supplies                                           1,000         18,633                  945          17,820
                                                            --------                             -------

         Prepaid expenses                                                       918                                  888
                                                                          ---------                             --------

            Total current assets                                            272,083                              268,571

     PROPERTY, PLANT AND EQUIPMENT:

         Land and land improvements                              172                                 146

         Buildings                                             6,796                               6,736

         Machinery and equipment                              13,040                              10,374
                                                            --------                             -------

                                                              20,008                              17,256

            Less allowance for depreciation                   11,002          9,006                9,911           7,345
                                                            --------                             -------

     OTHER ASSETS                                                            10,781                                9,469
                                                                          ---------                             --------

                                                                          $ 291,870                             $285,385
                                                                          =========                             ========

</TABLE>

The accompanying notes are an integral part of the financial statements.
<PAGE>

                                                                           
<TABLE>
<CAPTION>


NATIONAL PRESTO INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
                                                           DECEMBER 31, 1997                           DECEMBER 31, 1996
------------------------------------------------------------------------------------------------------------------------
<S>                                                           <C>             <C>               <C>            <C>  

LIABILITIES
     CURRENT LIABILITIES:

         Accounts payable                                               $ 15,958                                $ 13,262
                                                                                         
         Federal and state income taxes                                    4,923                                   4,887
                                                                                         
         Accrued liabilities                                              21,791                                  20,387
                                                                       ---------                                --------

            Total current liabilities                                     42,672                                  38,536

     COMMITMENTS AND CONTINGENCIES                                             -                                       -


STOCKHOLDERS' EQUITY

     Common stock, $1 par value:
                  Authorized: 12,000,000 shares
                  Issued: 7,440,518 shares                   $ 7,441                             $ 7,441

     Paid-in capital                                             925                                 903

     Retained earnings                                       243,092                             240,815
                                                             -------                             -------

                                                             251,458                             249,159

     Treasury stock, at cost, 85,537 shares
                  in 1997 and 87,447 shares in 1996            2,260                               2,310
                                                             -------                             -------

                     Total stockholders' equity                          249,198                                 246,849
                                                                       ---------                                --------

                                                                       $ 291,870                               $285,385
                                                                       =========                               ========

</TABLE>

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

<PAGE>

<TABLE>
<CAPTION>

NATIONAL PRESTO INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands except per share data)
           For the years ended December 31,                    1997          1996          1995
--------------------------------------------------------------------------------------------------

<S>                                                         <C>            <C>           <C>      
Gross sales                                                 $ 111,423      $ 107,878     $ 122,378

             Less freight, discounts, etc                       1,883          1,870         2,206
                                                            --------------------------------------

Net sales                                                     109,540        106,008       120,172

Cost of sales                                                  73,999         72,387        77,376
                                                            --------------------------------------

Gross profit                                                   35,541         33,621        42,796

Selling and general expenses                                   23,337         23,263        27,647
                                                            --------------------------------------

Operating profit                                               12,204         10,358        15,149

Other income, principally interest                              9,244          8,340         8,625

Other, principally litigation judgments                           550            476         2,316

Interest expense                                                   (8)          --            (687)
                                                            --------------------------------------

             Earnings before provision for income taxes        21,990         19,174        25,403

Provision for income taxes                                      5,008          4,454         6,434
                                                            --------------------------------------
                Net earnings                                $  16,982      $  14,720     $  18,969
                                                            ======================================
Weighted average shares outstanding:
             Basic                                              7,354          7,352         7,344
                                                            ======================================
             Diluted                                            7,355          7,353         7,345
                                                            ======================================
Net earnings per share:
             Basic                                          $    2.31      $    2.00     $    2.58
                                                            ======================================
             Diluted                                        $    2.31      $    2.00     $    2.61
                                                            ======================================

</TABLE>


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

<PAGE>

<TABLE>
<CAPTION>

NATIONAL PRESTO INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
             For the years ended December 31,                                       1997          1996           1995
-------------------------------------------------------------------------------------------------------------------------
<S>                                                                              <C>            <C>            <C>      
Cash flows from operating activities:
             Net earnings                                                        $  16,982      $  14,720      $  18,969
             Adjustments to reconcile net earnings to net cash
             provided by operating activities:
                Provision for depreciation                                           2,051          1,967          1,485
                Deferred income taxes                                               (1,143)        (1,772)          (505)
                Stock compensation expense                                              72             85             81
                Call option on early retirement of debt                               --             --              534
                Changes in:
                   Accounts receivable                                               1,584         16,290         (1,181)
                   Inventories                                                        (813)         7,785         (6,740)
                   Prepaid expenses                                                    (30)           865           (841)
                   Accounts payable and accrued liabilities                          4,100            687         (2,165)
                   Federal and state income taxes                                       36           (337)        (2,643)
                                                                                 ---------------------------------------
                      Net cash provided by operating activities                     22,839         40,290          6,994
                                                                                 ---------------------------------------

Cash flows from investing activities:
             Marketable securities purchased                                      (183,921)      (117,868)       (98,921)
             Marketable securities - maturities and sales                          179,429         94,292         99,092
             Acquisition of property, plant and equipment                           (4,021)        (2,003)        (4,456)
             Changes in other assets                                                   140            416            180
                                                                                 ---------------------------------------
                      Net cash used in investing activities                         (8,373)       (25,163)        (4,105)
                                                                                 ---------------------------------------

Cash flows from financing activities:
             Payment of long-term debt                                                --             --           (5,103)
             Dividends paid                                                        (14,705)       (14,702)       (15,776)
             Other                                                                    --                5             (6)
                                                                                 ---------------------------------------
                      Net cash used in financing activities                        (14,705)       (14,697)       (20,885)
                                                                                 ---------------------------------------

Net increase (decrease) in cash and cash equivalents                                  (239)           430        (17,996)
Cash and cash equivalents at beginning of year                                      91,878         91,448        109,444
                                                                                 ---------------------------------------
Cash and cash equivalents at end of year                                         $  91,639      $  91,878      $  91,448
                                                                                 =======================================

Supplemental disclosures of cash flow information:
      Cash paid during the year for:
                Interest                                                         $       8      $       1      $     727
                Income taxes                                                     $   6,103      $   6,565      $   9,526

</TABLE>

The accompanying notes are an integral part of the financial statements.
<PAGE>

<TABLE>
<CAPTION>

NATIONAL PRESTO INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(In thousands except per share data)
           For the years ended December 31, 1997, 1996, 1995
------------------------------------------------------------------------------------------------------------------------------------
                                                     Common       Paid-in         Retained           Treasury 
                                                      Stock       Capital         Earnings            Stock                 Total
                                                      -----       -------         --------            -----                 -----
<S>                                                  <C>            <C>             <C>                <C>                <C>      
Balance January 1, 1995                              $ 7,441        $590            $ 237,604          $(2,696)           $ 242,939

Net earnings                                               -           -               18,969                -               18,969

Dividends paid, $2.15 per share                            -           -              (15,776)               -              (15,776)

Stock issued for call premium on early
   retirement of debt                                      -         225                    -              309                  534

Other                                                      -          33                    -               42                   75
                                                 -----------------------------------------------------------------------------------

Balance December 31, 1995                              7,441         848              240,797           (2,345)             246,741

Net earnings                                               -           -               14,720                -               14,720

Dividends paid, $2.00 per share                            -           -              (14,702)               -              (14,702)

Other                                                      -          55                    0               35                   90
                                                 -----------------------------------------------------------------------------------

Balance December 31, 1996                              7,441         903              240,815           (2,310)             246,849

Net earnings                                               -           -               16,982                -               16,982

Dividends paid, $2.00 per share                            -           -              (14,705)               -              (14,705)

Other                                                      -          22                    -               50                   72
                                                 -----------------------------------------------------------------------------------

Balance December 31, 1997                            $ 7,441        $925            $ 243,092          $(2,260)           $ 249,198
                                                 ===================================================================================

</TABLE>

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

<PAGE>


NATIONAL PRESTO INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

A.    NATURE OF OPERATIONS:
      The Company manufactures and distributes small electrical appliances and
      housewares. Products are sold directly to retail outlets throughout the
      United States and also through independent distributors. These products
      are manufactured in plants located at Jackson, Mississippi; Alamogordo,
      New Mexico; and a portion of its products are imported from nonaffiliated
      companies in the Pacific Rim countries.

B.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
      (1)  USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS:
           In preparation of the Company's consolidated financial statements,
           management is required to make estimates and assumptions that affect
           the reported amounts of assets and liabilities and related revenues
           and expenses. Actual results may differ from the estimates used by
           management.

      (2)  PRINCIPLES OF CONSOLIDATION: The consolidated financial statements
           include the accounts of National Presto Industries, Inc. and its
           subsidiaries, all of which are wholly-owned. All material
           intercompany accounts and transactions are eliminated.

      (3)  CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES: The Company
           considers all highly liquid marketable securities with a maturity of
           one week or less to be cash equivalents. Cash equivalent securities
           totaled $92,418,000 and $90,963,000 at December 31, 1997 and 1996.
           The Company's cash equivalents and marketable securities are
           diversely invested, principally in A-rated or higher tax exempt bonds
           issued by entities throughout the United States.

           The Company has classified all cash equivalents and marketable
           securities as available for sale, which requires the securities to be
           reported at fair value, with unrealized gains and losses reported as
           a separate component of stockholders' equity. At December 31, 1997
           and 1996, cost approximated market value for all securities using the
           specific identification method. The contractual maturities of the
           marketable securities held at December 31, 1997 were $68,934,000 in
           1998, $42,234,000 in 1999, $23,736,000 in 2000, $1,112,000 in
           2001,$3,194,000 beyond 2001 and $1,441,000 with indeterminate
           maturities.

      (4)  INVENTORIES: Inventories are stated at the lower of cost or market
           with cost being determined principally on the last-in, first-out
           (LIFO) method.

      (5)  PROPERTY, PLANT AND EQUIPMENT: Property, plant and equipment are
           stated at cost. For machinery and equipment, all amounts that are
           fully depreciated have been eliminated from both the asset and
           allowance accounts. Depreciation is provided in amounts sufficient to
           relate the costs of depreciable assets to operations over their
           service lives, which are estimated at fifteen to forty years for
           buildings and three to seven years for machinery and equipment.

      (6)  REVENUE RECOGNITION: The Company recognizes revenues when product is
           shipped. The Company provides for its 60-day over-the-counter return
           privilege and warranties at the time of shipment.


<PAGE>


      (7)  ADVERTISING: The Company's policy is to expense advertising as
           incurred for the year. Advertising expense was $12,998,000,
           $11,956,000 and $16,479,000 in 1997, 1996 and 1995.

      (8) STOCK OPTIONS: The Company uses the intrinsic value method for valuing
          stock options issued.

C.  INVENTORIES:
      The amount of inventories valued on the LIFO basis is $17,633,000 and
      $16,875,000 as of December 31, 1997 and 1996. Under LIFO, inventories are
      valued at approximately $11,943,000 and $10,598,000 below current cost
      determined on a first-in, first-out (FIFO) basis at December 31, 1997 and
      1996. The Company uses the LIFO method of inventory accounting to improve
      matching of costs and revenues.

      The following table describes that which would have occurred if LIFO
      inventories had been valued at current cost determined on a FIFO basis:

                                            Increase (Decrease)
                                            -------------------
                                Cost of               Net            Earnings
            Year                 Sales             Earnings          Per Share
            ----                 -----             --------          ---------
            1997             $(1,345,000)         $ 834,000           $ 0.11
            1996                 926,000           (574,000)           (0.08)
            1995                (974,000)           604,000             0.08

      This information is provided for comparison with companies using the FIFO
      basis.

D.  ACCRUED LIABILITIES:
      At December 31, 1997 accrued liabilities consisted of payroll $2,291,000,
      insurance $12,285,000, environmental $3,641,000 and other $3,574,000. At
      December 31, 1996 accrued liabilities consisted of payroll $2,265,000,
      insurance $11,286,000, environmental $3,624,000 and other $3,212,000.

E.  TREASURY STOCK:
      The Board of Directors has authorized corporate reacquisition of up to
      750,000 common shares of the Company stock. No shares were reacquired in
      1997 or 1996. During 1995, 1,000 shares were reacquired. Treasury shares
      have been used for the exercise of stock options and to fund the Company's
      401(K) contributions (see note H).

F.  NET EARNINGS PER COMMON SHARE:
      On December 31, 1997, the Company adopted Statement of Financial
      Accounting Standards No. 128 - "Earnings per Share" ("SFAS 128"). As
      required by the statement, all current and prior year earnings per share
      data have been restated to conform to the provisions of SFAS 128.

      The Company's basic net earnings per share amounts have been computed by
      dividing net earnings by the weighted average number of outstanding common
      shares. The Company's diluted net earnings per share is computed by
      dividing net earnings by the weighted average number of outstanding common
      shares and common share equivalents relating to stock options, when
      dilutive. Options to purchase 7,500, 3,000 and 3,500 shares of common
      stock with a weighted average exercise price of $39.54, $41.28 and $41.22
      were outstanding at December 31, 1997, 1996 and 1995, but were excluded
      from the computation of common share equivalents because their exercise
      prices were greater than the average market price of the common shares.

<PAGE>

G.  STOCK OPTION PLAN:
      The National Presto Industries, Inc. Stock Option Plan reserves 100,000
      shares of the Company's common stock for key employees of the Company.
      Stock options for 7,500 shares at a weighted average price of $39.54 per
      share were outstanding at December 31, 1997. Stock options for 3,000
      shares at a weighted average price of $41.28 per share were outstanding at
      December 31, 1996. There were 1000 shares exercisable at $39.54 at
      December 31, 1997 and 500 shares exercisable at $41.28 at December 31,
      1996. The pro forma effect of stock options, if accounted for using the
      fair value method, is immaterial.

H.  RETIREMENT PLANS:
      Pension Plans:
      The Company has pension plans which cover the majority of employees.
      Pension benefits are based on an employee's years of service and
      compensation near the end of those years of service. The Company's funding
      policy has been to contribute such amounts as necessary, computed on an
      actuarial basis, to provide the plans with assets sufficient to meet the
      benefits to be paid to plan members. Plan assets consist primarily (79%)
      of interest bearing securities with the balance in corporate stocks,
      principally National Presto Industries, Inc. common stock.

      Assumptions used to calculate costs and actuarial present values are
      reviewed regularly by the Company and its independent actuaries. The
      assumptions used are as follows: 7% and 7.5% discount rate in 1997 and
      1996, 4.5% increase in compensation levels, and 8% long term rate of
      return on investments in 1997 and 1996. The funded status of the plans is 
      summarized below:

                                               (In thousands)
      As of December 31                   1997       1996        1995
      -----------------                   ----       ----        ----
      Fair value of plan assets         $ 7,527     $7,665    $ 9,137
      Projected benefit obligation        8,333      7,338      8,957
                                        -----------------------------
      Excess plan assets (obligations
         in excess of plan assets)      $  (806)    $  327    $   180
                                        =============================
      Prepaid pension expense           $ 2,778     $2,609    $ 3,012
                                        =============================

      401(k) Plan:
      The Company has a 401(k) retirement plan, which covers substantially all
      employees. The Company will match up to 25% of the first 4% contributed
      by employees to the plan. At its discretion, the Company's matching
      contribution can be made with either cash or common stock. Company
      contributions made from the Company's treasury stock, including the
      Company's cash dividends, totaled $72,000 in 1997, $85,000 in 1996, and
      $81,000 in 1995.

I.   INCOME TAXES:

      The following summarizes the provision for federal and state taxes on
      income:
          (Dollars in thousands)      1997       1996        1995
                                      ----       ----        ----
          Current:
               Federal               $ 5,201    $5,306    $ 5,884
               State                     950       920      1,055
                                     -----------------------------
                                       6,151     6,226      6,939
                                     -----------------------------
          Deferred:
               Federal                  (979)   (1,620)      (394)
               State                    (164)     (152)      (111)
                                     -----------------------------
                                      (1,143)   (1,772)      (505)
                                     -----------------------------
          Total tax provision        $ 5,008    $4,454    $ 6,434
                                     =============================


<PAGE>


      The effective rate of the provision for income taxes as shown in the
      consolidated statements of earnings differs from the applicable statutory
      federal income tax rate for the following reasons:

                                                   Percent of Pre-tax Income
                                                   -------------------------
                                                1997          1996         1995
                                                ----          ----         ----
          Statutory rate                        35.0%         35.0%        35.0%
          State tax                              2.3%          2.6%         2.4%
          Tax exempt interest and dividends    -13.8%        -14.1%       -12.0%
          Other                                 -0.7%         -0.3%        -0.1%
                                               ---------------------------------
          Effective rate                        22.8%         23.2%        25.3%
                                               =================================

      Deferred tax assets and liabilities are recorded based on the differences
      between the tax basis of assets and liabilities and their carrying amounts
      for financial reporting purposes. The tax effects of the cumulative
      temporary differences resulting in a deferred tax asset are as follows at
      December 31:
                                                 (In thousands)
                                               1997             1996
                                               ----             ----
          Insurance                          $ 4,717          $4,322
          Environmental                        1,360           1,356
          Pension                             (1,067)           (999)
          Other                                2,843           2,031
                                         ----------------------------
                                             $ 7,853          $6,710
                                         ============================

J.   CONCENTRATIONS:
      One customer accounts for 43%, 38% and 36% of net sales for the years
      ended December 31, 1997, 1996 and 1995.

      Production levels at commercial plants may be affected by vendor failure
      to deliver tooling, material and critical parts within commitments. While
      recent years have witnessed virtual elimination of these circumstances,
      there is no assurance against recurrence. Deliveries of new products, some
      of which have been sourced overseas, could be delayed by labor or supply
      problems at the vendors or in transportation. As a consequence, these
      products may not be available in sufficient quantities during the prime
      selling period. While there has been no major incidence of such problems
      and the Company has made every reasonable effort to prevent occurrence,
      there is no assurance that such effort will be totally effective.

K.   ENVIRONMENTAL:
      The Company is involved in certain environmental investigation and
      restoration activities with governmental agencies. The Company has entered
      into an agreement with the Department of Army that provides for funding
      costs related to environmental restoration. A total of $27,000,000 has
      been appropriated in connection with that agreement of which $23,563,000
      has been received. The funding of these expenses by the Department of Army
      has not been recognized as revenues or expenses of the Company. Based on
      factors known as of December 31, 1997, it is believed that the funds
      appropriated to date will be adequate to satisfy remaining investigation
      and restoration activities; however, should environmental agencies require
      additional studies or remediation activities beyond what is now
      contemplated, it is possible that existing funds could be inadequate.
      Management believes that in the absence of any unforeseen future
      developments, these environmental matters will not have any material
      effect on the results of operations or financial condition of the Company.


<PAGE>


L.   INTERIM FINANCIAL INFORMATION (UNAUDITED):

      The following represents unaudited financial information for 1997, 1996,
      and 1995:

                                       (In thousands)
                                       --------------
                         Net          Gross          Net        Earnings
       Quarter          Sales        Profit       Earnings      Per Share
       -------          -----        ------       --------      ---------
      1997
         First       $  17,947       $ 3,931       $ 2,579        $ 0.35
         Second         16,870         4,932         2,640          0.36
         Third          24,917         8,271         3,503          0.48
         Fourth         49,806        18,407         8,260        $ 1.12
                     ---------------------------------------------------
            Total    $ 109,540       $35,541       $16,982        $ 2.31
                     ===================================================
      1996
         First       $  17,109       $ 3,637       $ 1,930        $ 0.26
         Second         16,970         4,338         2,236          0.31
         Third          23,001         6,936         2,821          0.38
         Fourth         48,928        18,710         7,733          1.05
                     ---------------------------------------------------
            Total    $ 106,008       $33,621       $14,720        $ 2.00
                     ===================================================
      1995
         First       $  17,962       $ 5,207       $ 2,547        $ 0.35
         Second         15,882         4,482         2,497          0.35
         Third          29,039         9,691         4,797          0.65
         Fourth         57,289        23,416         9,128          1.26
                     ---------------------------------------------------
            Total    $ 120,172       $42,796       $18,969        $ 2.61
                     ===================================================

      The Company's operations are in one industry segment.

<PAGE>


               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


Stockholders and Board of Directors
National Presto Industries, Inc.

             We have audited the accompanying consolidated balance sheets of
National Presto Industries, Inc. and subsidiaries as of December 31, 1997 and
1996, and the related consolidated statements of earnings, stockholders' equity,
and cash flows for each of the three years in the period ended December 31,
1997. These financial statements are the responsibility of the Company'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 amounts and disclosures in the financial statements. An audit
also includes assessing 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 financial statements referred to above present
fairly, in all material respects, the consolidated financial position of
National Presto Industries, Inc. and subsidiaries as of December 31, 1997 and
1996, and the consolidated results of their operations and their consolidated
cash flows for each of the three years in the period ended December 31, 1997 in
conformity with generally accepted accounting principles.

             We have also audited Schedule II of National Presto Industries,
Inc. and subsidiaries for each of the three years in the period ended December
31, 1997. In our opinion, this schedule presents fairly, in all material
respects, the information required to be set forth therein.


/S/ Grant Thornton LLP
Minneapolis, Minnesota
February 19, 1998

<PAGE>


                NATIONAL PRESTO INDUSTRIES, INC. AND SUBSIDIARIES

                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

              For the Years Ended December 31, 1997, 1996 and 1995

<TABLE>
<CAPTION>

                                                                 (In thousands)
                                                                 --------------
           Column A                   Column B     Column C        Column D      Column E
           --------                   --------     --------        --------      --------
                                     Balance at                                 Balance at
                                     Beginning                                      End
         Description                 of Period   Additions (A)  Deductions (B)   of Period
         -----------                 ---------   -------------  --------------   ---------
<S>                                    <C>         <C>             <C>            <C>  
Deducted from assets:
   Allowance for doubtful accounts:

      Year ended December 31, 1997     $ 450       $ 148           $ 148          $ 450
                                     =====================================================

      Year ended December 31, 1996     $ 450       $ (46)          $ (46)         $ 450
                                     =====================================================

      Year ended December 31, 1995     $ 450       $ 572           $ 572          $ 450
                                     =====================================================

</TABLE>

Notes:
   (A)  Amounts charged (credited) to selling and general expenses

   (B)  Principally bad debts written off, net of recoveries