UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                        Washington, D.C. 20549
                       ------------------------

                              FORM 10-Q/A

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

           For the quarterly period ended September 30, 1997

                    Commission File Number  0-27490

                             ALRENCO, INC.
        (Exact name of registrant as specified in its charter)


           Indiana                                      35-1480655     
(State or other jurisdiction of                      (I.R.S. Employer  
incorporation or organization)                      Identification No.)


                         1736 East Main Street
                      New Albany, Indiana  47150
                            (812) 949-3370

              (Address, including zip code, and telephone
              number, including area code of registrant's
                     principal executive offices)



                                 NONE
                (Former name, former address and former
               fiscal year if changed since last report)





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
                                          -----       -----




The number of shares outstanding of the issuer's common stock, 
as of the close of business November 1, 1997:  6,095,516
<PAGE>
                             ALRENCO, INC.


                                 INDEX



PART I.    Financial Information                               Page No.

           Item 1.  Financial Statements

           Condensed Balance Sheets as of 
             September 30, 1997 and December 31, 1996             3    

           Condensed Statements of Earnings for
             the nine months ended September 30, 
             1997 and 1996                                        4    

           Condensed Statements of Earnings for
             the quarter ended September 30, 
             1997 and 1996                                        5    

           Condensed Statements of Cash Flows 
             for the nine months ended 
             September 30, 1997 and 1996                          6    

           Notes to Condensed Financial Statements                7    


           Item 2.  Management's Discussion and Analysis 
                      of Financial Condition and Results of
                      Operations                                  8    


PART II.  Other Information

           Item 6.   Exhibits and Reports on Form 8-K            11    


SIGNATURES                                                       11    




                                  -2-


<PAGE>
                             ALRENCO, INC.
                            Balance sheets

<TABLE>
<CAPTION>
                                         September 30,   December 31,
                                             1997            1996
                                          (Unaudited)
                                         -------------   ------------

        ASSETS

<S>                                        <C>            <C>
Cash and cash equivalents                  $ 4,015,993    $ 7,468,539
Rental merchandise, net                     36,886,237     27,932,741
Prepaid expenses and other assets            2,598,622      1,436,556
Income tax receivable                              -          323,327
Deferred income taxes                          378,263        377,839
Property assets, net                         5,499,528      4,261,951
Loan to stockholder                             78,654         71,636
Intangible assets, net                      35,429,549     20,323,147
                                           -----------    -----------
                                           $84,886,846    $62,195,736
                                           ===========    ===========

  LIABILITIES AND STOCKHOLDERS' EQUITY

Accounts payable - trade                   $ 2,581,620    $ 2,567,140
Accrued liabilities                          4,300,770      1,542,056
Taxes other than income                        264,222        423,274
Debt                                        15,625,092            -  
                                           -----------    -----------
                                            22,771,704      4,532,470

Stockholders' equity
  Preferred stock, no par; 1,000,000 
  shares authorized; none issued 
  or outstanding                                   -              -  

  Common stock, no par; 20,000,000 
  shares authorized, 6,095,516 shares 
  issued and outstanding at 
  September 30, 1997 and 6,074,100 
  shares issued and outstanding at
  December 31, 1996                         50,887,512     50,707,938

  Unamortized value of stock award          (1,036,392)    (1,182,138)

  Retained Earnings                         12,264,022      8,137,466
                                           -----------    -----------
                                            62,115,142     57,663,266

                                           $84,886,846    $62,195,736
                                           ===========    ===========
</TABLE>
    The accompanying notes are an integral part of these statements


                                  -3-

<PAGE>
                             ALRENCO, INC.
                        Statements Of Earnings
                       For the Nine Months Ended
                              (Unaudited)

<TABLE>
<CAPTION>
                                                 September 30,
                                            -------------------------
                                              1997           1996
                                           -----------    -----------
REVENUE
<S>                                        <C>            <C>
Rentals and fees                           $74,698,266    $43,287,272
Sales                                        1,386,874        828,501
Other                                           86,235         55,804
                                           -----------    -----------
    Total Revenue                           76,171,375     44,171,577

OPERATING EXPENSES
Direct store expenses
  Depreciation of rental merchandise        18,065,635      9,611,828
  Cost of sales                              1,074,036        533,109
  Salaries and other expenses               41,489,315     24,237,551
                                           -----------    -----------
                                            60,628,986     34,382,488

General and administrative expenses          6,298,852      3,903,214
Amortization of intangibles                  2,448,802        613,341
                                           -----------    -----------
    Total operating expenses                69,376,640     38,899,043
                                           -----------    -----------

    Operating profit                         6,794,735      5,272,534

Gain on sale of assets                         950,366            -  
Interest income                                  1,366          6,118
Interest expense                              (844,581)      (615,204)
                                           -----------    -----------

Earnings before income taxes                 6,901,886      4,663,448

Income tax expense                           2,775,330      1,913,774
                                           -----------    -----------

    NET EARNINGS                           $ 4,126,556    $ 2,749,674
                                           ===========    ===========

Weighted average shares outstanding          6,082,205      4,365,814

Earnings per common share                  $      0.68    $      0.63
                                           ===========    ===========
</TABLE>

    The accompanying notes are an integral part of these statements

                                  -4-
<PAGE>
                             ALRENCO, INC.
                        Statements Of Earnings
                         For the Quarter Ended
                              (Unaudited)

<TABLE>
<CAPTION>
                                                 September 30,
                                            -------------------------
                                              1997           1996
                                           -----------    -----------
REVENUE
<S>                                        <C>            <C>
Rentals and fees                           $25,391,843    $16,851,084
Sales                                          429,350        296,543
Other                                           35,064         19,974
                                           -----------    -----------
    Total Revenue                           25,856,257     17,167,601

OPERATING EXPENSES
Direct store expenses
  Depreciation of rental merchandise         6,262,780      3,675,570
  Cost of sales                                333,323        196,967
  Salaries and other expenses               14,939,377      9,412,684
                                           -----------    -----------
                                            21,535,480     13,285,221

General and administrative expenses          1,725,414      1,455,664
Amortization of intangibles                    881,674        226,273
                                           -----------    -----------
    Total operating expenses                24,142,568     14,967,158
                                           -----------    -----------

    Operating profit                         1,713,689      2,200,443

Gain on sale of assets                         950,366            -  
Interest income                                    471             10
Interest expense                              (340,301)      (324,326)
                                           -----------    -----------

Earnings before income taxes                 2,324,225      1,876,127

Income tax expense                             923,840        769,228
                                           -----------    -----------

    NET EARNINGS                           $ 1,400,385    $ 1,106,899
                                           ===========    ===========

Weighted average shares outstanding          6,094,011      4,672,147

Earnings per common share                  $      0.23    $      0.24
                                           ===========    ===========
</TABLE>

    The accompanying notes are an integral part of these statements


                                  -5-
<PAGE>
                             Statements of Cash Flows
                             For the Nine Months Ended
                                    (Unaudited)


<TABLE>
<CAPTION>
                                                          September 30,
                                                   ----------------------------
                                                      1997             1996
                                                   -----------      -----------

<S>                                                <C>              <C>
Cash flows from operating activities
  Net earnings                                     $ 4,126,556      $ 2,749,674
    Adjustments to reconcile net earnings 
      to net cash provided by operating 
      activities
        Depreciation of rental merchandise          18,065,635        9,611,828
        Depreciation of property assets                703,563          524,273
        Amortization of intangibles                  2,448,804          613,341
        Amortization of stock awards                   145,746          107,006
        Gain on sale of assets                        (950,366)             -  
    Changes in operating assets and 
      liabilities net of effects of 
      acquisitions and sales
        Rental merchandise                         (21,590,742)     (15,327,389)
        Prepaid expenses and other                    (846,083)      (1,244,527)
        Accounts payable-trade                          14,480        3,317,100
        Accrued liabilities                          2,324,682       (1,215,636)
        Income taxes payable                           204,296          453,905
        Taxes other than income                         70,684           25,688
                                                   -----------      -----------
           Net cash provided by (used in)
            operating activities                     4,717,255         (384,737)

Cash flows from investing activities
  Purchases of property assets                      (1,621,705)      (1,314,036)
  Increase in loan to shareholder                       (7,018)          (7,252)
  Sale of assets                                     3,031,691              -  
  Acquisitions of businesses                       (25,377,435)     (22,195,241)
                                                   -----------      -----------
           Net cash used in investing 
            activities                             (23,974,467)     (23,516,529)

Cash flows from financing activities
  Proceeds from public offerings - net                     -         48,058,013
  Proceeds from exercise of stock options              179,574              -  
  Increase (decrease) in line of credit             15,625,092      (12,865,239)
                                                   -----------      -----------
           Net cash provided by 
            financing activities                    15,804,666       35,192,774

    NET INCREASE (DECREASE) IN CASH
      AND CASH EQUIVALENTS                          (3,452,546)      11,291,508

Cash and cash equivalents at 
  beginning of year                                  7,468,539           27,041
                                                   -----------      -----------

Cash and cash equivalents at 
  end of period                                    $ 4,015,993      $11,318,549
                                                   ===========      ===========

Supplemental cash flow information
  Cash paid during the period for
    Interest                                       $   846,018      $   620,734
    Income taxes                                   $ 2,309,980      $ 1,744,164

</TABLE>
          The accompanying notes are an integral part of these statements

                                        -6-
<PAGE>
                             ALRENCO, INC.
                Notes to Condensed Financial Statements

1.   BASIS OF PRESENTATION.  The accompanying condensed financial
statements of Alrenco, Inc. (the Company) have been prepared in
accordance with generally accepted accounting principles for
interim financial information and with the instructions to Rule
10-01 of Regulation S-X.  Accordingly, they do not include all of
the information and footnotes required by generally accepted
accounting principles for complete financial statements.  In the
opinion of the Company, the accompanying unaudited condensed
financial statements contain all adjustments (consisting of only
normal recurring accruals) necessary to present fairly the
financial position of the company as of September 30, 1997, the
results of operations for the three and nine month periods ended
September 30, 1997 and 1996,  and the statements of cash flows
for the nine month periods ended September 30, 1997 and 1996. 
The results of operations for the periods ended September 30,
1997 are not necessarily indicative of the operating results for
the full year.  These interim financial statements should be read
in conjunction with the Form 10-K for the year ended December 31,
1996, including the financial statements and notes contained
therein, filed with the Securities and Exchange Commission.

2.   DEBT AGREEMENTS.  On July 31, 1997, the Company entered into
a formal agreement with a bank for a $30,000,000  line of credit
facility.  This agreement replaces a similar, smaller facility
with another bank.  The agreement carries a three-year term with
interest rates of prime minus 1/2%.  Under the terms of the
agreement, the Company is required to pay 1/8 of 1% per annum on
the unused portion of the facility.  As of October 31, 1997 the
Company owed $15.0 million under the agreement.

3.   ACQUISITION ACTIVITY.  The company purchased 28 rental-
purchase stores from a company doing business as Fastway Rentals
on January 2, 1997 for cash of approximately $11.9 million.  On
February 28, 1997, the Company acquired 9 stores from a company
doing business as Powerhouse Rentals for cash of approximately
$6.5 million. During the nine month period ended September 30,
1997, the Company also acquired 16 rental-purchase stores and 13
rental portfolios in 16 unrelated transactions for an aggregate
purchase price of $7.0 million.  During 1996, the Company
purchased 76 rental-purchase stores in 22 separate transactions
for an aggregate purchase price of $25.0 million.   All of the
acquisitions have been accounted for as purchases and accordingly
the operating results of the acquired stores have been included
in the operating results of the company since their acquisition
dates. 

The following summary, prepared on a pro-forma basis, combines
the results of operations as if the stores had been acquired at
the beginning of each of the periods presented after including
the effect of adjustments for amortization of intangibles and
interest expense on acquisition debt.  Weighted average share
outstanding calculations have been adjusted to reflect the impact
of public stock offerings.

<TABLE>
                       Nine Months Ended          Three Months Ended
                    --------------------------------------------------
                    09/30/97      09/30/96      09/30/97       09/30/96
                    --------      --------      --------       --------
<S>                <C>           <C>           <C>            <C>
Revenue            $80,187,102   $76,831,936   $26,274,116    $25,962,134
Net Earnings       $ 4,151,951   $ 3,565,845   $ 1,401,902    $ 1,274,465
Earnings per 
  common share     $      0.68   $      0.82   $      0.23    $      0.27
</TABLE>

4.   GAIN ON SALE OF ASSETS.  In August 1997, the Company sold
eight marginally performing stores, in two separate transactions,
for an aggregate price of $3.0 million cash.  Net gain on these
transactions was $950,400.  

5.   PENDING MERGER.  On September 29, 1997 the Company and RTO,
Inc. announced the signing of a definitive merger agreement.  Under
the terms of the agreement, RTO shareholders will receive
approximately 10.9 million shares of Alrenco's common stock in
exchange for all of the outstanding common stock of RTO, Inc.  The
merger agreement is subject to customary consents and approvals,
including approval by shareholders of Alrenco and RTO.  Closing of
the merger is expected in the first quarter of 1998.

                                   -7-
<PAGE>
6.   NEW ACCOUNTING PRONOUNCEMENT.  The FASB has issued Statement
of Financial Accounting Standards No. 128, Earnings Per Share,
which is effective for financial statements issued after December
15, 1997.  Early adoption of the new standard is not permitted. 
The new standard eliminates primary and fully diluted earnings per
share together with disclosure of how the per share amounts were
computed.  Basic earnings per share excludes dilution and is
computed by dividing income available to common shareholders by the
weighted-average common shares outstanding for the period.  Diluted
earnings per share reflects the potential dilution that could occur
if securities or other contracts to issue common stock were
exercised and converted into common stock or resulted in the
issuance of common stock that then shared in the earnings of the
entity.  The adoption of this new pronouncement will not have a
material impact on the disclosure of earnings per share in the
financial statements.   


                              ALRENCO, INC.

                 Management's Discussion and Analysis of
              Financial Condition and Results of Operations


GENERAL

In the nine months ended September 30, 1997, the Company acquired
53 rental-purchase stores in 8 separate transactions. The financial
results for the nine months since the date of each acquisition 
includes additional revenue of $9.3 million and additional
operating profit of $2.4 million from these acquisitions.  In
addition, during the nine month period ended September 30, 1997 the
Company acquired 13 rental account portfolios which were merged
into existing stores.   

PENDING MERGER

On September 29, 1997 the Company and RTO, Inc. announced the
signing of a definitive merger agreement.  Under the terms of the
agreement, RTO shareholders will receive approximately 10.9 million
shares of Alrenco's common stock in exchange for all of the
outstanding common stock of RTO, Inc.  The merger agreement is
subject to customary consents and approvals, including approval by
shareholders of Alrenco and RTO.  Closing of the merger is expected
in the first quarter of 1998.   

RESULTS OF OPERATIONS

     REVENUE.  Revenue increased $8.7 million or 50.6% to $25.9
million for the quarter ended September 30, 1997 from $17.2 million
in the comparable quarter in 1996.  Revenue growth from same store
operations accounted for $625,100, or 7.2% of the increase for the
quarter, and revenue growth from stores acquired subsequent to June
30, 1996 accounted for $8.1 million or 92.8% of the increase. For
the nine months ended September 30, 1997, revenue increased $32.0
million or 72.4% to $76.2 million from $44.2 million for the
comparable period in 1996. Revenue growth from same store
operations accounted for $581,300, or 1.8% of the increase for the
nine months, and revenue growth from stores acquired subsequent to
December 31, 1996 accounted for $31.4 million or 98.2% of the
increase.   Management believes that the increase in revenue for
the period was primarily attributable to the addition of revenue
from the stores acquired during 1996 and 1997. 


                                   -8-
<PAGE>
     DEPRECIATION OF RENTAL MERCHANDISE.  Depreciation of rental
merchandise increased $2.6 million or 70.4% to $6.3 million for the
quarter ended September 30, 1997 from $3.7 million in the
comparable quarter in 1996.  As a percentage of revenue,
depreciation of rental merchandise increased to 24.2% for the three
months ended September 30, 1997 from 21.4% for the comparable
period in 1996, primarily as a result of discounted terms on second
and third quarter rentals.  For the nine months ended September 30,
1997, depreciation of rental merchandise increased  $8.5 million or
88.0% to $18.1 million from $9.6 million in the comparable period
in 1996.   As a percentage of revenue, depreciation of rental
merchandise increased to 23.7% for the nine months ended September
30, 1997 from 21.8% for the comparable period in 1996, primarily as
a result of discounted terms on second and third quarter rentals.

     OTHER DIRECT STORE EXPENSES.  Other direct store expenses
increased $5.7 million or 58.9% to $15.3 million for the quarter
ended September 30, 1997 from $9.6 million for the same period in
1996.  As a percentage of revenue, other direct store expenses
increased to 59.1% for the three months ended September 30, 1997
from 56.0% for the comparable period in 1996.  For the nine months
ended September 30, 1997, other direct store expenses increased 
$17.8 million or 71.8% to $42.6 million from $24.8 million in the
comparable period in 1996.  As a percentage of revenue, other
direct store expenses decreased to 55.9% for the nine months ended
September 30, 1997 from 56.1% for the comparable period in 1996.
These percentage decreases were primarily attributable to the
additional volume being generated by the stores acquired in 1996
and 1997.

     GENERAL AND ADMINISTRATIVE EXPENSES.  General and
administrative expenses increased  $270,000 or 18.5% to $1.7
million for the quarter ended September 30, 1997 from $1.5 million
in the comparable quarter.  As a percentage of revenue, general and
administrative expenses decreased to 6.7% for the three months
ended September 30, 1997 from 8.5% for the 1996 comparable period,
primarily as a result of vendors participation fees received for
exhibits at the annual meeting.  For the nine months ended
September 30, 1997, general and administrative expenses increased 
$2.4 million or 61.4% to $6.3 million from $3.9 million in the
comparable period.  As a percentage of revenue, general and
administrative expenses decreased to 8.3% for the nine months ended
September 30, 1997 from 8.8% for the comparable period in 1996.  

     AMORTIZATION OF INTANGIBLES.  Amortization of intangibles
increased $655,400 or 289.7% to $881,700 for the quarter ended
September 30, 1997 from $226,300 for the 1996 comparable period. 
For the nine months ended September 30, 1997, amortization of
intangibles increased $1.8 million or 299.3% to $2.4 million
primarily as a result of intangible assets created by the 1996 and
1997 acquisitions.  A portion of intangibles is amortized over a 15
month period from date of acquisition.  As intangibles created by
the 1996 and 1997 acquisitions become fully amortized, amortization
expense for these acquisitions will correspondingly decrease.

     GAIN ON SALE OF ASSETS.  In August 1997, the Company sold
eight marginally performing stores, in two separate transactions,
for an aggregate price of $3.0 million cash.  Net gain on these
transactions was $950,400.  

     NET EARNINGS.  Net earnings increased $293,500 or 26.5% to
$1.4 million for the quarter from $1.1 million for the comparable
quarter in 1996.  The increase in net earnings for the quarter over
the comparable period in 1996 was primarily due to gain recognized
on sale of assets.  As a percentage of revenue, net earnings
decreased to 5.4% for the quarter ended September 30, 1997 from
6.4% for the comparable period in 1996.  For the nine months ended
September 30, 1997, net earnings increased $1.4 million or 50.1% to
$4.1 million from $2.7 million in 1996.  As a percentage of
revenue, net earnings decreased to 5.4% for the nine month period
ended September 30, 1997 from 6.2% for the comparable period in
1996. These percentage decreases are primarily attributable to
higher amortization of intangibles.
 

                                   -9-

<PAGE>
LIQUIDITY AND CAPITAL RESOURCES

     The Company's primary requirements for capital, other than
those related to acquisitions, consist of purchasing additional
rental merchandise and replacing rental merchandise which has been
sold or is no longer suitable for rent.  During the nine months
ended September 30, 1997 and 1996, the Company purchased rental
merchandise for aggregate amounts of approximately $21.6 million
and $15.3 million respectively.  In addition, during the nine
months ended September 30, 1997, the Company has acquired 53 stores
and 13 rental account portfolios for an aggregate purchase price of
$25.4 million  cash and sold 8 stores for $3.0 million cash. 

For the nine months ended September 30, 1997, net cash provided by
operating activities increased $5.1 million to $4.7 million from
$384,700  used in the prior year primarily due to the additional
cash generated from the operations of the stores acquired in the
1995 and 1996 acquisitions partially offset by increased purchases
of rental merchandise for stores acquired in the 1996 and 1997
acquisitions.

The Company has a debt facility with a bank which provides for a
maximum debt level of $30.0 million and carries a three-year term
with interest rates of  prime rate minus 1/2%.  Under the terms of
the agreement,  the Company is required to pay  1/8 of 1% per annum
on the unused portion of the facility.  As of October 31, 1997 the
Company had $15.0 million in outstanding loans under the agreement. 



RECENT ACCOUNTING PRONOUNCEMENTS

The FASB has issued Statement of Financial Accounting Standards No.
128, Earnings Per Share, which is effective for financial
statements issued after December 15, 1997.  Early adoption of the
new standard is not permitted.  The new standard eliminates primary
and fully diluted earnings per share together with disclosure of
how the per share amounts were computed.  Basic earnings per share
excludes dilution and is computed by dividing income available to
common shareholders by the weighted-average common shares
outstanding for the period.  Diluted earnings per share reflects
the potential dilution that could occur if securities or other
contracts to issue common stock were exercised and converted into
common stock or resulted in the issuance of common stock that then
shared in the earnings of the entity.  The adoption of this new
pronouncement will not have a material impact on the disclosure of
earnings per share in the financial statements.




                                  -10-

<PAGE>
                              ALRENCO, INC.

                       PART II.  OTHER INFORMATION


Item 6.    Exhibits and Reports on Form 8-K
-------------------------------------------

     (a)   The following exhibit is filed as part of this report:

           27 - Financial Data Schedule

     (b)   On August 8, 1997, the registrant filed a current report
           on Form 8-K to disclose the execution of a new bank
           credit agreement.  A copy of the loan agreement was filed
           as an exhibit to the Form 8-K. 







                               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 thereto duly authorized.



Date:  January 7, 1998
                                 ALRENCO, INC.
                                 (Registrant)



                                 /s/ Theodore H. Wilson
                                 ------------------------------------
                                 Theodore H. Wilson, 
                                 Executive Vice President and
                                   Chief Financial Officer









                                  -11-