U. S. Securities and Exchange Commission
                         Washington, D. C.  20549

                              FORM 10-QSB

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

     For the quarter ended September 30, 1998
                           ------------------

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

     For the transition period from               to
                                    -------------    -------------

                        Commission File No. 0-24374
                                            ----------

                        LUCAS EDUCATIONAL SYSTEMS, INC.     
                      -----------------------------------
              (Name of Small Business Issuer in its Charter)

       DELAWARE                                            62-1690722
       --------                                            ----------         
(State or Other Jurisdiction of                     (I.R.S. Employer I.D. No.)
 incorporation or organization)

                               P. O. Box 789
                        Templeton, California 93465
                        ---------------------------    
                 (Address of Principal Executive Offices)

                Issuer's Telephone Number:  (805) 434-3982

     Check whether the Issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the Company was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.  

     (1)   Yes  X    No            (2)   Yes  X    No 
               ---      ---                  ---      ---


               (ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS 
                       DURING THE PAST FIVE YEARS)

     Check whether the issuer has filed all documents and reports required to
be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution
of securities under a plan confirmed by a court.  Yes____        No ___        
  
                 (APPLICABLE ONLY TO CORPORATE ISSUERS)

          State the number of shares outstanding of each of the Issuer's
classes of common equity, as of the latest practicable date:

                             September 30, 1998

                          Common - 11,733,619 shares

                     DOCUMENTS INCORPORATED BY REFERENCE

          A description of any "Documents Incorporated by Reference" is
contained in Item 6 of this Report.

Transitional Small Business Issuer Format   Yes  X   No 
                                                ---     ---

                  PART I - FINANCIAL INFORMATION

Item 1.   Financial Statements.

          The Consolidated Financial Statements of the Company required
to be filed with this 10-QSB Quarterly Report were prepared by management and
commence on the following page, together with related Notes.  In the opinion
of management, these Consolidated Financial Statements fairly present the
financial condition of the Company.
       
<PAGE>
<TABLE>
                 LUCAS EDUCATIONAL SYSTEMS, INC.
                          Balance sheet
  September 30, 1998 and 1997 (unaudited) and March 31, 1998 (audited)
<CAPTION>
                              September 30,   September 30,    March 31,
                                   1998          1997           1999
<S>                                <C>             <C>          <C>
                              ASSETS
Current Assets
     Cash in Bank                  $ 18,765      $       71     $ 37,191
     Inventory                        5,610             -          5,610
     Prepaid Expenses                 9,643             -             -
     Organization costs                 -               388           -
TOTAL CURRENT ASSETS                 34,018             459       42,801

Property and Equipment
     Leasehold Improvements          11,070             -         11,070       
     Furniture and Fixtures           1,931             -          1,931       
     Computer Equipment              17,009             -         17,009       
     Automobiles                     37,382             -         37,382       
     Video Master Tapes               1,577             -          1,577       
     Video Set-up Fee                12,000             -         12,000       
     Accumulated Depreciation       (14,977)            -         (5,750)      
TOTAL PROPERTY AND EQUIPMENT         65,992             -         75,219      

TOTAL ASSETS                        100,010             459      121,020    

               LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities
     Accounts Payable                 5,125           1,215       46,036 
     Accrued Payroll Taxes              -               -          6,470 
     Accrued Salaries                   -               -          3,403  
TOTAL CURRENT LIABILITIES             5,125           1,215       55,899 

Stockholders' Equity
     Preferred stock $.001 par; 
     1,000,000 shares authorized,
     none issued or outstanding
     
     Common Stock, $.001 par;
     20,000,000 shares authorized,
     11,733,619; 11,243,619 and 1,000
     issued and outstanding          11,735               1       11,244 
     Paid in capital                635,784              99      405,146 
     Stock Subscription Receivable      -               -            (25)  
     Retained Earnings Deficit     (552,634)           (856)    (351,244) 
TOTAL STOCKHOLDERS' EQUITY           94,885            (756)      65,121 

TOTAL LIABILITIES AND STOCKHOLDERS' 
EQUITY                              100,010             459      121,020
</TABLE>
<TABLE>
                 LUCAS EDUCATIONAL SYSTEMS, INC.
                     Statement of Operations
<CAPTION>
                             For the six           From inception
                             months ended        December 5, 1996 to
                             September 30,   September 30,    March 31, 
                                1998           1997            1998
<S>                               <C>             <C>            <C>
Revenues                          $       -       $         -     $       -

Expenses
     Depreciation and amortization     9,228               77        5,750
     General and Administrative      192,162              779      345,494
TOTAL EXPENSES                       201,390              856      351,244

LOSS FOR THE PERIOD                 (201,390)            (856)    (351,244)

LOSS PER SHARE                         (.018)           (.000)       (.035)
</TABLE>
                            Note to financial statements 

     The accompanying unaudited financial statements include all of the
adjustments which, in the opinion of management, are necessary for a fair
presentation.  Such adjustments are of a normal, recurring nature.

Item 2.   Management's Discussion and Analysis or Plan of Operation.

Plan of Operation.
-----------------

      The Company has not engaged in any material operations or
had any revenues from operations during the quarter ended September 30, 1998.
The Company completed a reorganization whereby it acquired all of the
outstanding voting securities of Lucas Educational Systems, Inc., a Nevada
corporation ("Lucas Nevada"), reported in a  Form 8-K Current Report dated
November 11, 1997, which has been previously filed with the Securities and
Exchange Commission and which is incorporated herein by reference.

     The Company plans in the next twelve months to promote the Company's
product through direct or indirect marketing channels.

     The Company will need $500,000 for operations for the next twelve months,
and these funds will need to be raised through debt or equity financing.   

Results of Operations.
----------------------
      
     At September 30, 1998, the Company had $100,010 in assets and current
liabilities of $5,125.  There were no revenues in the six months ended
September 30, 1998, and losses from operations during this period were
($201,390). 

Liquidity
---------

     The Company received $120,000 in equity funding during the quarter ended
September 30, 1998, by selling 60,000 "unregistered" and "restricted" shares
of the Company's $0.001 par value common stock, at a purchase price of $2.00
per share.

                   PART II - OTHER INFORMATION

Item 1.   Legal Proceedings.

          None; not applicable.

Item 2.   Changes in Securities.

          None; not applicable.

Item 3.   Defaults Upon Senior Securities.

          None; not applicable.

Item 4.   Submission of Matters to a Vote of Security Holders.

          No matter was submitted to a vote of the Company's security holders
during the period covered by this Report.

Item 5.   Other Information.

          None; not applicable.

Item 6.   Exhibits and Reports on Form 8-K.
                                                                               
                                                        Exhibit
          (a)  Exhibits.                                Number

           Annual Report on Form 10-KSB for the year    **
           ended March 31, 1998, filed August 21, 1998    
 
          (b)  Reports on Form 8-K.

             SEC Form 8-K, dated November 11, 1997,       **
           regarding the Plan with Lucas Nevada

     ** These documents and related exhibits have been previously filed with
the Securities and Exchange Commission and by this reference are incorporated
herein.

                            SIGNATURES

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

                                       LUCAS EDUCATIONAL SYSTEMS, INC.



Date: 11/11/98                      By:/s/Jerry R. Lucas
                                       Jerry R. Lucas
                                       President and Director



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


                                       LUCAS EDUCATIONAL SYSTEMS, INC.



Date: 11/11/98                      By:/s/Jerry R. Lucas
                                       Jerry R. Lucas
                                       President and Director
                                         
Date: 11/11/98                      By:/s/Cheryl W. Lucas
                                       Cheryl W. Lucas
                                       Treasurer and Director

Date: 11/16/98                      By:/s/David Nelson
                                       David Nelson
                                       Secretary and CFO