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

                            FORM 10-Q


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

          For the quarterly period ended June 30, 2000

                               OR

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

           For the transition period from____to____


                  Commission file number 0-9722


                      INTERGRAPH CORPORATION
     ------------------------------------------------------
     (Exact name of registrant as specified in its charter)

           Delaware                                 63-0573222
-------------------------------                -------------------
(State or other jurisdiction of                 (I.R.S. Employer
incorporation or organization)                 Identification No.)

        Intergraph Corporation
          Huntsville, Alabama                         35894-0001
----------------------------------------              ----------
(Address of principal executive offices)              (Zip Code)

                           (256) 730-2000
                         ------------------
                         (Telephone Number)


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___


   Common stock, par value  $.10 per share: 49,380,467 shares
                 outstanding as of June 30, 2000



==================================================================


                     INTERGRAPH CORPORATION
                           FORM 10-Q*
                          June 30, 2000

                              INDEX


                                                          Page No.
                                                          --------

PART I.  FINANCIAL INFORMATION
         ---------------------

   Item 1. Financial Statements


           Consolidated Balance Sheets at June 30,
              2000 and December 31, 1999                     2

           Consolidated Statements of Operations
              for the quarters and six months
              ended June 30, 2000 and 1999                   3

           Consolidated Statements of Cash Flows
              for the six months ended June 30,
              2000 and 1999                                  4

           Notes to Consolidated Financial Statements      5 - 13

   Item 2. Management's Discussion and Analysis
           of Financial Condition and Results of
           Operations                                     14 - 25

   Item 3. Quantitative and Qualitative Disclosures
           About Market Risk                                26



PART II. OTHER INFORMATION
         -----------------

   Item 1. Legal Proceedings                                26

   Item 4. Submission of Matters to a Vote of
           Security Holders                                 27

   Item 6. Exhibits and Reports on Form 8-K                 27


SIGNATURES                                                  28




*Information contained in this Form 10-Q includes statements that
are forward looking as defined in Section 21E of the Securities
Exchange Act of 1934.  Actual results may differ materially from
those projected in the forward looking statements.  Information
concerning factors that could cause actual results to differ
materially from those in the forward looking statements is
described in the Company's filings with the Securities and
Exchange Commission, including its most recent Annual Report on
Form 10-K, its Form 10-Q for the quarter ended March 31, 2000,
and this Form 10-Q.


PART I.  FINANCIAL INFORMATION
         ---------------------

             INTERGRAPH CORPORATION AND SUBSIDIARIES
                   CONSOLIDATED BALANCE SHEETS
                           (Unaudited)

--------------------------------------------------------------------
                                        June 30,       December 31,
                                          2000             1999
--------------------------------------------------------------------
(In thousands except share and per share amounts)

Assets
  Cash and cash equivalents             $ 92,544         $ 88,513
  Accounts receivable, net               217,675          258,768
  Inventories                             31,429           35,918
  Other current assets                    27,776           28,744
--------------------------------------------------------------------
      Total current assets               369,424          411,943

  Investments in affiliates                9,593            9,940
  Other assets                            64,709           68,154
  Property, plant, and equipment, net     71,898           94,907
--------------------------------------------------------------------
      Total Assets                      $515,624         $584,944
====================================================================

Liabilities and Shareholders' Equity
  Trade accounts payable                $ 36,195         $ 50,963
  Accrued compensation                    35,425           35,848
  Other accrued expenses                  55,599           71,052
  Billings in excess of sales             53,928           66,051
  Income taxes payable                     8,164            8,175
  Short-term debt and current
     maturites of long-term debt           7,643           11,547
--------------------------------------------------------------------
      Total current liabilities          196,954          243,636

  Deferred income taxes                    2,304            2,620
  Long-term debt                          33,066           51,379
  Other noncurrent liabilities            10,766           10,609
--------------------------------------------------------------------
      Total liabilities                  243,090          308,244
--------------------------------------------------------------------

  Shareholders' equity:
   Common stock, par value $.10
     per share - 100,000,000 shares
     authorized; 57,361,362 shares
     issued                                5,736            5,736
   Additional paid-in capital            215,428          216,943
   Retained earnings                     175,594          178,231
   Accumulated other comprehensive
     income                               (7,920)          (5,506)
--------------------------------------------------------------------
                                         388,838          395,404
   Less - cost of 7,980,895 treasury
     shares at June 30, 2000 and
     8,145,149 treasury shares at
     December 31, 1999                  (116,304)        (118,704)
--------------------------------------------------------------------
      Total shareholders' equity         272,534          276,700
--------------------------------------------------------------------
      Total Liabilities and
        Shareholders' Equity            $515,624         $584,944
====================================================================

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

             INTERGRAPH CORPORATION AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF OPERATIONS
                           (Unaudited)

--------------------------------------------------------------------------
                         Quarter Ended June 30,  Six Months Ended June 30,
                               2000      1999            2000       1999
--------------------------------------------------------------------------
(In thousands except per share amounts)

Revenues
 Systems                    $123,242  $154,521        $257,580   $321,900
 Maintenance                  41,505    45,608          83,813     95,276
 Services                     23,234    26,947          45,993     54,510
--------------------------------------------------------------------------
   Total revenues            187,981   227,076         387,386    471,686
--------------------------------------------------------------------------

Cost of revenues
 Systems                      76,456   107,373         162,547    226,295
 Maintenance                  22,493    22,402          45,090     48,437
 Services                     20,025    21,881          38,514     42,608
--------------------------------------------------------------------------
   Total cost of revenues    118,974   151,656         246,151    317,340
--------------------------------------------------------------------------

   Gross profit               69,007    75,420         141,235    154,346

Product development           16,002    15,790          29,963     31,343
Sales and marketing           31,866    45,412          64,803     89,400
General and administrative    23,867    28,987          48,839     54,377
Nonrecurring operating
   charges                       ---     2,472             ---      2,472
--------------------------------------------------------------------------

   Loss from operations       (2,728)  (17,241)         (2,370)   (23,246)

Gain on sale of assets           ---    11,505             ---     11,505
Arbitration settlement           ---       ---             ---    ( 8,562)
Interest expense              (1,112)  ( 1,423)         (2,288)   ( 2,839)
Other income (expense) - net   2,678   ( 2,489)          5,921    ( 1,981)
--------------------------------------------------------------------------

   Income (loss) from
   continuing operations
   before income taxes        (1,162)  ( 9,648)          1,263    (25,123)

Income tax expense             2,500       ---           3,900        ---
--------------------------------------------------------------------------

   Loss from continuing
   operations                 (3,662)  ( 9,648)         (2,637)   (25,123)

Loss from discontinued
   operation, net of
   income taxes                  ---   ( 2,444)            ---    ( 4,527)
--------------------------------------------------------------------------

   Net loss                 $ (3,662) $(12,092)       $ (2,637)  $(29,650)
==========================================================================

   Loss per share - basic
    and diluted:
     Continuing operations  $ (  .07) $(   .20)       $ (  .05)  $(   .52)
     Discontinued operation      ---   (   .05)            ---    (   .09)
--------------------------------------------------------------------------
          Net loss          $ (  .07) $(   .25)       $ (  .05)  $(   .61)
==========================================================================

Weighted average shares
   outstanding -
     basic and diluted        49,330    48,831          49,292     48,765
==========================================================================

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


             INTERGRAPH CORPORATION AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF CASH FLOWS
                           (Unaudited)

---------------------------------------------------------------------
Six Months Ended June 30,                       2000          1999
---------------------------------------------------------------------
(In thousands)

Cash Provided By (Used For):
Operating Activities:
  Net loss                                   $( 2,637)     $(29,650)
  Adjustments to reconcile net loss to net
  cash provided by (used for) operating
  activities:
   Gain on sale of subsidiary                     ---       (11,505)
   Gains on sales of capital assets           ( 7,181)      ( 1,392)
   Depreciation                                 8,083        10,778
   Amortization                                11,079        13,162
   Noncash portion of arbitration settlement      ---         3,530
   Noncash portion of nonrecurring operating
     charges                                      ---         2,472
   Net changes in current assets and
     liabilities                                7,688         8,504
---------------------------------------------------------------------
   Net cash provided by (used for) operating
     activities                                17,032       ( 4,101)
---------------------------------------------------------------------

Investing Activities:
  Net proceeds from sales of assets            16,667        24,631
  Purchases of property, plant, and equipment ( 4,171)      ( 5,723)
  Capitalized software development costs      ( 8,520)      ( 9,627)
  Capitalized internal use software costs     (   760)      ( 2,967)
  Business acquisition, net of cash acquired  ( 1,051)      ( 1,874)
  Other                                       (   229)      ( 1,959)
---------------------------------------------------------------------
   Net cash provided by investing activities    1,936         2,481
---------------------------------------------------------------------

Financing Activities:
  Gross borrowings                                ---            45
  Debt repayment                              (13,016)      (17,897)
  Proceeds of employee stock purchases and
    exercise of stock options                     885         1,361
---------------------------------------------------------------------
   Net cash used for financing activities     (12,131)      (16,491)
---------------------------------------------------------------------
Effect of exchange rate changes on cash       ( 2,806)      ( 2,118)
---------------------------------------------------------------------
Net increase (decrease) in cash and cash
  equivalents                                   4,031       (20,229)
Cash and cash equivalents at beginning
  of period                                    88,513        95,473
---------------------------------------------------------------------
Cash and cash equivalents at end of period   $ 92,544      $ 75,244
=====================================================================

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

             INTERGRAPH CORPORATION AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1:  In  the  opinion of management, the accompanying unaudited
         consolidated financial statements contain all  adjustments
         (consisting  of  normal recurring items) necessary  for  a
         fair  presentation  of  results for  the  interim  periods
         presented.

         Certain   reclassifications  have   been   made   to   the
         previously  reported consolidated statements of operations
         and  cash flows for the quarter and six months ended  June
         30,  1999 to provide comparability with the current period
         presentation.

NOTE 2:  Discontinued Operation.  On October 31, 1999, the  Company
         sold  its  VeriBest, Inc. operating segment.  Accordingly,
         the  Company's  consolidated statements of operations  for
         the  quarter  and six months ended June 30, 1999 have been
         restated  to reflect VeriBest's business as a discontinued
         operation.   The  discontinued  operation  has  not   been
         presented  separately  in  the consolidated  statement  of
         cash  flows for the six months ended June 30, 1999.  Other
         than  its operating losses for the periods presented,  the
         discontinued  operation did not have a significant  impact
         on  the  Company's  consolidated cash  flow  or  financial
         position.

         For  the quarter ended June 30, 1999, VeriBest incurred  a
         net  loss  of $2,444,000, including a loss from operations
         of  $2,232,000, on revenues from unaffiliated customers of
         $6,568,000.    For  the six months ended  June  30,  1999,
         VeriBest  incurred a net loss of $4,527,000,  including  a
         loss  from  operations  of $4,130,000,  on  revenues  from
         unaffiliated customers of $14,035,000.

NOTE 3:  Litigation.  As further described in the Company's  Annual
         Report  on Form 10-K for its year ended December 31,  1999
         and  its  Form 10-Q for the quarter ended March 31,  2000,
         the  Company has extensive ongoing litigation  with  Intel
         Corporation.  See Management's Discussion and Analysis  of
         Financial  Condition  and Results of  Operations  in  this
         Form  10-Q for a discussion of developments during  second
         quarter 2000.

NOTE 4:  Arbitration Settlement.  The Company maintains an equity
         ownership   position  in  Bentley  Systems,   Incorporated
         ("BSI"),  the  developer  and  owner  of  MicroStation,  a
         software   product  utilized  in  many  of  the  Company's
         software applications and for which the Company serves  as
         a  nonexclusive distributor.  In March 1996, BSI commenced
         arbitration   against  the  Company  with   the   American
         Arbitration  Association, Atlanta,  Georgia,  relating  to
         the  respective rights of the companies under their  April
         1987   Software  License  Agreement  and  other   matters,
         including  the Company's alleged failure to  properly  pay
         to  BSI  certain  royalties on its sales of  BSI  software
         products,  and seeking significant damages.  On March  26,
         1999,  the Company and BSI executed a Settlement Agreement
         and  Mutual  General Release ("the Agreement")  to  settle
         this  arbitration and mutually release all claims  related
         to  the  arbitration  or  otherwise,  except  for  certain
         litigation  between the companies that was the subject  of
         a  separate settlement agreement and payment for  products
         and services obtained or provided in the normal course  of
         business since January 1, 1999.  Both the Company and  BSI
         expressly  denied  any  fault,  liability,  or  wrongdoing
         concerning the claims that were the subject matter of  the
         arbitration   and  settled  solely  to  avoid   continuing
         litigation with each other.

         Under the terms of the Agreement, the Company on April  1,
         1999  made  payment to BSI of $12,000,000 and  transferred
         to  BSI ownership of three million of the shares of  BSI's
         Class   A   common  stock  owned  by  the  Company.    The
         transferred    shares   were   valued   at   approximately
         $3,500,000  on  the Company's books. As a  result  of  the
         settlement,  Intergraph's  equity  ownership  in  BSI  was
         reduced  from  approximately  50%  to  approximately  33%.
         Additionally, the Company had a $1,200,000 net  receivable
         from  BSI relating to business conducted prior to  January
         1,  1999  which  was  written off in connection  with  the
         settlement.

         In  first quarter 1999, the Company accrued a nonoperating
         charge  to  earnings  of $8,562,000 ($.18  per  share)  in
         connection  with the settlement, representing the  portion
         of  settlement costs not previously accrued.  This  charge
         is   included   in   "Arbitration   settlement"   in   the
         consolidated  statement of operations for the  six  months
         ended June 30, 1999.

         The  $12,000,000 payment to BSI was funded primarily  from
         existing  cash balances.  For further discussion regarding
         the  Company's liquidity, see Management's Discussion  and
         Analysis  of Financial Condition and Results of Operations
         in this Form 10-Q.


NOTE 5:  Inventories  are  stated at the lower of average  cost  or
         market and are summarized as follows:

         ----------------------------------------------------------
                                 June 30,       December 31,
                                   2000              1999
         ----------------------------------------------------------
         (In thousands)

         Raw materials            $ 9,985          $12,888
         Work-in-process            3,668            5,739
         Finished goods             7,619            5,895
         Service spares            10,157           11,396
         ----------------------------------------------------------
         Totals                   $31,429          $35,918
         ==========================================================

         The Company's December 31, 1999 raw materials and work-in-
         process  balances  have been restated to  reflect  certain
         parts as raw materials rather than work-in-process as  the
         Company  is  no  longer manufacturing or assembling  these
         products at its facilities.  Amounts reflected as work-in-
         process relate primarily to contracts accounted for  under
         the percentage-of-completion method.

NOTE 6:  Property,  plant, and equipment - net includes  allowances
         for  depreciation of $202,450,000 and $214,219,000 at June
         30, 2000 and December 31, 1999, respectively.

NOTE 7:  In  January  1999, the Company acquired  PID,  an  Israeli
         software   development  company,   for   $5,655,000.    At
         closing,  the  Company paid $2,180,000 in cash,  with  the
         remainder  due  in  varying installments through  February
         2002.  Installment payments totaling $1,051,000 were  made
         in  the  first  six  months of 2000 and  are  included  in
         "Business  acquisition,  net  of  cash  acquired"  in  the
         Company's  consolidated statement of cash  flows  for  the
         six  months ended June 30, 2000.  The accounts and results
         of  operations of PID have been combined with those of the
         Company  since the date of acquisition using the  purchase
         method  of  accounting.  This acquisition has  not  had  a
         material effect on the Company's results of operations.

NOTE 8:  In  November 1998, the Company sold substantially  all  of
         its  U.S.  manufacturing assets to  SCI  Technology,  Inc.
         ("SCI")  a  wholly-owned subsidiary of SCI Systems,  Inc.,
         and  SCI  assumed responsibility for the manufacturing  of
         substantially  all  of  the Company's  hardware  products.
         The  total purchase price was $62,404,000, $42,485,000  of
         which  was received during fourth quarter 1998.  The final
         purchase price installment of $19,919,000 was received  on
         January  12,  1999 and is included in "Net  proceeds  from
         sales  of  assets" in the Company's consolidated statement
         of  cash flows for the six months ended June 30, 1999.  As
         part  of this transaction, SCI retained the option to sell
         to  the Company any inventory included in the initial sale
         which  had not been utilized in the manufacture  and  sale
         of  finished  goods within six months of the date  of  the
         sale  (the  "unused inventory").  On June  30,  1999,  SCI
         exercised  this  option  and sold to  the  Company  unused
         inventory  having a value of approximately $10,200,000  in
         exchange for a cash payment of $2,000,000 on July 2,  1999
         and   a   short-term  installment  note  payable  in   the
         principal amount of $8,200,000.  This note was payable  in
         three monthly installments concluding October 1, 1999  and
         bore  interest  at a rate of 9%.  The Company  funded  its
         payments  to  SCI primarily with existing  cash  balances.
         For  further discussion regarding the Company's liquidity,
         see  Management's  Discussion and  Analysis  of  Financial
         Condition  and  Results of Operations in this  Form  10-Q.
         For  a complete discussion of the SCI transaction, see the
         Company's  Annual Report on Form 10-K for the  year  ended
         December 31, 1999.

 NOTE 9: Nonrecurring Operating Charges.  During 1998 and 1999,
         the  Company implemented various restructuring actions  in
         an effort to restore the Company to profitability.  For  a
         complete  discussion, see the Company's Annual  Report  on
         Form   10-K   for  the  year  ended  December  31,   1999.
         Restructuring  activity during the  first  six  months  of
         1999 and 2000 is discussed below.

         In   second   quarter  1999,  in  response  to   continued
         operating  losses  in  its  Intergraph  Computer   Systems
         ("ICS")  operating  segment,  the  Company  implemented  a
         resizing   of   its  European  computer   hardware   sales
         organization.  This resizing involved closing most of  the
         Company's  ICS  subsidiaries in Europe  and  consolidating
         the  European hardware sales effort within the  Intergraph
         subsidiaries  in  that  region.  The  associated  cost  of
         $2,500,000,  primarily  for  employee  severance  pay,  is
         included  in  "Nonrecurring  operating  charges"  in   the
         consolidated statements of operations for the quarter  and
         six   months  ended  June  30,  1999.   Approximately   46
         European  positions were eliminated, all in the sales  and
         marketing area.  The Company estimates that this  resizing
         has   resulted   in   annual  savings   of   approximately
         $3,000,000.

         Cash  outlays for severance related to the 1998  and  1999
         actions approximated $3,500,000 and $900,000 in the  first
         six  months  of 2000 and 1999, respectively. At  June  30,
         2000,  the total remaining accrued liability for severance
         relating   to   the   1999   reductions   in   force   was
         approximately   $1,400,000   compared   to   approximately
         $5,000,000  at  December 31, 1999.  These liabilities  are
         reflected  in  "Other accrued expenses" in  the  Company's
         consolidated  balance  sheets.   The  related  costs   are
         expected to be paid over the remainder of 2000 and  relate
         primarily  to severance liabilities in European countries,
         where   typically   several  months   are   required   for
         settlement.

         Severance payments to date have been funded from  existing
         cash   balances  and  from  proceeds  from  the  sale   of
         VeriBest.   For further discussion regarding the Company's
         liquidity,  see  Management's Discussion and  Analysis  of
         Financial  Condition  and Results of  Operations  in  this
         Form 10-Q.

NOTE 10: Supplementary cash flow information is summarized  as
         follows:

         Changes  in  current assets and liabilities,  net  of  the
         effects   of  business  acquisitions,  divestitures,   and
         nonrecurring  operating charges, in reconciling  net  loss
         to  net  cash  provided by (used for)  operations  are  as
         follows:

         ----------------------------------------------------------
                                             Cash Provided By
                                          (Used For) Operations
         Six Months Ended June 30,          2000          1999
         ----------------------------------------------------------
         (In thousands)

         (Increase) decrease in:
           Accounts receivable, net       $35,732       $27,871
           Inventories                      4,232        (3,341)
           Other current assets             4,871        (2,320)
         Increase (decrease) in:
           Trade accounts payable         (14,321)       (2,303)
           Accrued  compensation and
            other accrued expenses        (12,715)       (3,123)
           Income taxes payable                85        (1,150)
           Billings in excess of sales    (10,196)       (7,130)
         ----------------------------------------------------------
         Net changes in current assets
          and liabilities                 $ 7,688       $ 8,504
         ==========================================================

         Investing and financing transactions in the first half  of
         2000  that  did not require cash included the  termination
         of  a  long-term lease on one of the Company's facilities.
         The  Company accounted for this lease as a financing,  and
         upon   termination,  long-term  debt  of  $8,300,000   and
         property, plant, and equipment of $6,500,000 were  removed
         from  the  Company's books.  Significant noncash investing
         and  financing  transactions in the  first  half  of  1999
         included the acquisition of a business in part for  future
         obligations  totaling approximately $3,475,000  (see  Note
         7),  the  sale  of  a  subsidiary  in  part  for  deferred
         payments  and  debt  of  $8,297,000  (see  Note  16),  the
         purchase  of  inventory  for future  obligations  totaling
         $10,200,000  (see  Note 8), the sale of  fixed  assets  in
         part for a $2,100,000 short-term note receivable, and  the
         financing  of  new  financial and  administrative  systems
         with   a   long-term   note   payable   of   approximately
         $2,000,000.

NOTE 11: Basic  loss per share is computed using the  weighted
         average  number  of  common shares  outstanding.   Diluted
         loss  per  share  is computed using the  weighted  average
         number    of   common   and   equivalent   common   shares
         outstanding.   Employee stock options  are  the  Company's
         only  common  stock  equivalent and are  included  in  the
         calculation only if dilutive.

NOTE 12: The  Company's  operating  segments  are  Intergraph
         Computer  Systems ("ICS"), Intergraph Public Safety,  Inc.
         ("IPS"),  the Software and Intergraph Government Solutions
         businesses  (collectively,  the  Software  and  Government
         Solutions  businesses  form what is termed  "Intergraph"),
         and  Z/I  Imaging Corporation ("Z/I Imaging"), a 60%-owned
         subsidiary  of  the  Company  formed  October   1,   1999.
         Effective October 31, 1999, the Company sold its  VeriBest
         operating segment and, accordingly, its operating  results
         are  reflected  in "Loss from discontinued operation,  net
         of  income taxes" in the Company's consolidated statements
         of  operations for the quarter and six months  ended  June
         30,  1999.  Certain VeriBest financial information for the
         quarter and six months ended June 30, 1999 is included  in
         Note 2.

         The  Company's reportable segments are strategic  business
         units  which  are organized by the types of products  sold
         and   the  specific  markets  served.   They  are  managed
         separately   due  to  unique  technology   and   marketing
         strategy resident in each of the Company's markets.

         ICS is historically a supplier of high performance Windows
         NT-based graphics workstations and 3D graphics subsystems.
         IPS develops, markets, and implements systems for the public
         safety and utilities industries. Intergraph supplies software
         and solutions, including  hardware  purchased  from   ICS,
         consulting,  and services to the process and building  and
         infrastructure  industries  and  provides   services   and
         specialized  engineering  and  information  technology  to
         support   Federal   government  programs.    Z/I   Imaging
         supplies  end-to-end photogrammetry solutions  for  front-
         end  data  collection to mapping related  and  engineering
         markets.

         The   Company  evaluates  performance  of  the   operating
         segments  based  on  revenue and income  from  operations.
         The  accounting  policies of the reportable  segments  are
         the  same as those used in preparation of the consolidated
         financial  statements of Intergraph Corporation (see  Note
         1  of  Notes to Consolidated Financial Statements included
         in  the Company's Annual Report on Form 10-K for the  year
         ended  December  31, 1999).  Sales between  the  operating
         segments,  the  most  significant of which  are  sales  of
         hardware  products and maintenance from ICS to  the  other
         segments,  are  accounted  for under  a  transfer  pricing
         policy.  Transfer prices approximate prices that would  be
         charged  for  the  same or similar property  to  similarly
         situated  unrelated  buyers.  In  the  U.S.,  intersegment
         sales  of  products and services to be used  for  internal
         purposes   are   charged  at  cost.    For   international
         subsidiaries,  transfer price is charged  on  intersegment
         sales  of  products  and services to be  used  for  either
         internal purposes or sale to customers.

         The  following  table  sets forth revenues  and  operating
         income  (loss) by operating segment for the  quarters  and
         six months ended June 30, 2000 and 1999.

         ---------------------------------------------------------------------
                                         Quarter                  Six Months
                                      Ended June 30,            Ended June 30,
                                      2000      1999            2000      1999
         ---------------------------------------------------------------------
         (In thousands)

         Revenues
         ICS:
           Unaffiliated customers $ 41,179  $ 52,844        $ 83,540  $115,021
           Intersegment revenues    11,660    33,261          27,826    64,409
         ---------------------------------------------------------------------
                                    52,839    86,105         111,366   179,430
         ---------------------------------------------------------------------

         IPS:
           Unaffiliated customers   19,836    22,198          38,983    42,532
           Intersegment revenues     1,909     2,547           4,627     3,504
         ---------------------------------------------------------------------
                                    21,745    24,745          43,610    46,036
         ---------------------------------------------------------------------

         Intergraph Software:
           Unaffiliated customers   85,602   114,406         177,360   235,300
           Intersegment revenues     1,971     3,953           4,131     8,566
         ---------------------------------------------------------------------
                                    87,573   118,359         181,491   243,866
         ---------------------------------------------------------------------

         Intergraph Government Solutions:
           Unaffiliated customers   35,755    37,628          73,956    78,833
           Intersegment revenues     1,508     2,147           2,649     3,706
         ---------------------------------------------------------------------
                                    37,263    39,775          76,605    82,539
         ---------------------------------------------------------------------

         Z/I Imaging:
           Unaffiliated customers    5,609       ---          13,547       ---
           Intersegment revenues     5,762       ---           9,894       ---
         ---------------------------------------------------------------------
                                    11,371       ---          23,441       ---
         ---------------------------------------------------------------------
                                   210,791   268,984         436,513   551,871
         ---------------------------------------------------------------------
         Eliminations              (22,810)  (41,908)        (49,127)  (80,185)
         ---------------------------------------------------------------------
         Total revenues           $187,981  $227,076        $387,386  $471,686
         =====================================================================

         ---------------------------------------------------------------------
         Operating income (loss) before nonrecurring charges:

         ICS                      $    514  $(12,839)       $( 3,566) $(19,506)
         IPS                         1,107     3,259           2,561     5,186
         Intergraph Software        (1,526)    4,137           1,969     7,530
         Intergraph Government
          Solutions                  1,441     1,402           4,871     5,635
         Z/I Imaging                 2,480       ---           5,217       ---
         Corporate                  (6,744)  (10,728)        (13,422)  (19,619)
         ---------------------------------------------------------------------
         Total                    $ (2,728) $(14,769)       $( 2,370) $(20,774)
         =====================================================================

         Prior  to  October  1999, a portion  of  the  Z/I  Imaging
         business   was   included  in  the   Intergraph   Software
         operating  segment.  The Company believes  the  associated
         revenues  and operating income for the second quarter  and
         first  half  of  1999 were insignificant to  the  Software
         segment as a whole.

         Amounts  included in the "Corporate" category  consist  of
         general   corporate   expenses,  primarily   general   and
         administrative  expenses remaining after  charges  to  the
         operating   segments   based   on   segment    usage    of
         administrative  services.  Included in these  amounts  are
         legal fees of $4,404,000 and $7,595,000 for the first  six
         months of 2000 and 1999, respectively.

         Significant profit and loss items that were not  allocated
         to  the  segments and not included in the  analysis  above
         include   a   charge  of  $8,562,000  for  an  arbitration
         settlement  agreement reached with Bentley  Systems,  Inc.
         in  first  quarter 1999 (see Note 4), an $11,505,000  gain
         on  the  sale of a subsidiary in second quarter 1999  (see
         Note   16),   and   nonrecurring  operating   charges   of
         $2,472,000 incurred in second quarter 1999 (see Note 9).

         The  Company  does  not evaluate performance  or  allocate
         resources  based  on  assets and, as  such,  it  does  not
         prepare  balance sheets for its operating segments,  other
         than those of its wholly-owned subsidiaries.

NOTE 13: Comprehensive   income   (loss).    The   Company's
         comprehensive losses for the second quarter and first  six
         months   of   2000  totaled  $4,108,000  and   $5,051,000,
         respectively,   compared   to  comprehensive   losses   of
         $16,133,000   and  $36,949,000,  respectively,   for   the
         comparable   prior  year  periods.   These   comprehensive
         losses   differ  from  net  loss  due  mainly  to  foreign
         currency translation adjustments.

NOTE 14: In June 1998, the Financial Accounting Standards Board
         ("FASB")   issued   Statement  of   Financial   Accounting
         Standards  No. 133, Accounting for Derivative  Instruments
         and  Hedging Activities ("SFAS 133"), requiring  companies
         to  recognize derivatives as either assets or  liabilities
         on  the  balance  sheet and to measure the instruments  at
         fair   value.    In  July  1999,  the  FASB  delayed   the
         implementation of this new accounting standard  to  fiscal
         years  beginning after June 15, 2000 (calendar  year  2001
         for  the  Company).  The Company is evaluating the effects
         of   adopting   SFAS  133  but  does  not   anticipate   a
         significant  impact on its consolidated operating  results
         or financial position.

NOTE 15: In   December  1999,  the  Securities  and  Exchange
         Commission  ("SEC") issued Staff Accounting  Bulletin  No.
         101,  Revenue  Recognition in Financial  Statements  ("SAB
         101"),   which   provides  guidance  on  the  recognition,
         presentation,  and  disclosure  of  revenue  in  financial
         statements.  SAB 101 outlines basic criteria that must  be
         met  prior to recognition of revenue, including persuasive
         evidence  of the existence of an arrangement, the delivery
         of  products  and  performance of services,  a  fixed  and
         determinable  sales  price, and  reasonable  assurance  of
         collection.    In   June  2000,  the   SEC   delayed   the
         implementation  date of SAB 101 until no  later  than  the
         fourth  fiscal  quarter  of fiscal years  beginning  after
         December  15, 1999 (fourth quarter 2000 for the  Company).
         The  Company  is  currently  evaluating  the  effects   of
         adopting  SAB 101 and will record any material  impact  on
         prior  periods  as the cumulative effect of  a  change  in
         accounting  principle  in its fourth  quarter  results  of
         operations,  with a restatement of prior interim  quarters
         of  2000,  if  necessary.  The SEC has indicated  that  it
         will   issue   further  guidance  with  respect   to   the
         implementation   of  SAB  101.   Until   this   additional
         guidance is issued, the Company cannot fully evaluate  the
         impact,   if  any,  that  this  SAB  will  have   on   its
         consolidated operating results or financial position.

NOTE 16: In  April  1999,  the Company sold InterCAP  Graphics
         Systems,  Inc., a wholly-owned subsidiary, to  Micrografx,
         a  global  provider of enterprise graphics  software,  for
         $12,150,000, consisting of $3,853,000 in cash received  at
         closing,  deferred  payments  received  in  September  and
         October   1999  totaling  $2,500,000,  and  a   $5,797,000
         convertible   subordinated  debenture   due   March   2002
         (included  in  "Other assets" in the  June  30,  2000  and
         December  31,  1999  consolidated  balance  sheets).   The
         resulting  gain  on  this transaction  of  $11,505,000  is
         included  in  "Gain on sale of assets" in the consolidated
         statements  of operations for the quarter and  six  months
         ended  June 30, 1999.  InterCAP's revenues and losses  for
         1998   were   $4,660,000  and  $1,144,000,   respectively,
         ($3,600,000  and  $1,853,000 for  1997).   Assets  of  the
         subsidiary  at December 31, 1998 totaled $1,550,000.   The
         subsidiary  did  not  have  a  material  effect   on   the
         Company's  results of operations for the  period  in  1999
         prior to its sale.

NOTE 17: On  April 27, 2000, the Company and BSI announced  an
         agreement   under  which  BSI  will  acquire  Intergraph's
         MicroStation-based     civil    engineering,     networked
         plotservers,   and  raster  conversion  software   product
         lines,  and the Company will sell and support MicroStation
         and certain other BSI products.  The agreement, valued  at
         approximately $42,000,000, is subject to the execution  of
         definitive documents and is expected to close by  the  end
         of  third quarter 2000.  Full year 1999 revenues  for  the
         product  lines to be sold to BSI approximated $35,000,000.
         The  agreement  will  allow the Company  to  increase  its
         focus  on its core vertical businesses and is expected  to
         improve the business relationship between the Company  and
         BSI.

NOTE 18: On  May  25, 2000, the Company reached an  agreement,
         subject  to  inspection  and  final  documents,  to   sell
         several  of  the  buildings  on  its  Huntsville,  Alabama
         campus  to an Alabama-based real estate investment company
         for   $7,600,000.   The  resulting  consolidation  of  the
         Company's  Huntsville-based personnel and operations  into
         fewer  buildings  is  expected  to  reduce  the  Company's
         overhead  expenses.  The closing of the sale is  scheduled
         for completion in September 2000.  The Company expects  to
         record   a  nonoperating  gain  on  this  transaction   of
         approximately $2,000,000 in its third quarter  results  of
         operations.

NOTE 19: Subsequent  Events.  On July 21,  2000,  the  Company
         completed  the sale of the Intense3D graphics  accelerator
         division  of  ICS  to  3Dlabs,  Inc.  Ltd.  ("3Dlabs"),  a
         leading  supplier  of  integrated  hardware  and  software
         graphics   accelerator  solutions  for  workstations   and
         design  professionals.  As initial consideration  for  the
         acquired   assets,   3Dlabs   issued   to   the    Company
         approximately  3,600,000  of its  common  shares  with  an
         aggregate  market  value of approximately  $13,200,000  on
         the date of closing.  The agreement also contains an earn-
         out  provision based on various performance  measures  for
         Intense3D  operations for the remainder of 2000  following
         the  July  1  effective date of the sale.   This  earn-out
         provides an opportunity for additional proceeds of  up  to
         $25,000,000,  payable in stock and/or cash at  the  option
         of  3Dlabs.   The Company expects to record a pretax  gain
         from   initial  proceeds  of  the  sale  of  approximately
         $9,000,000  in third quarter 2000.  Full year 1999  third-
         party  revenue  for  the  Intense3D division  approximated
         $38,000,000,  with  operating results  at  an  approximate
         breakeven level.

         On  July  21,  2000, the Company announced its  intent  to
         form  a  strategic  alliance with Silicon  Graphics,  Inc.
         ("SGI"),   a   worldwide  provider   of   high-performance
         computing  and advanced graphics solutions, in  which  SGI
         will  acquire  certain of the Company's hardware  business
         assets,  including ICS's Zx10 family of  workstations  and
         servers.   Under the proposed alliance, the  Company  will
         become  a  reseller for SGI and will offer its application
         solutions  on the SGI platform.  In connection  with  this
         agreement,  the Company plans to purchase $100,000,000  in
         SGI  products and services over a three year  period.  The
         terms  of  the  sale  are  still  being  finalized.    The
         transaction  is expected to close in third  quarter  2000.

         These  two transactions signal completion of the Company's
         exit  of  the  development,  design,  and  manufacture  of
         hardware   products,  allowing  the  Company's   operating
         segments   to   focus   on  providing  software,   systems
         integration,  and  services to  the  industries  in  which
         Intergraph is a market leader.  Upon completion  of  these
         transactions, the Company expects to incur a  nonrecurring
         charge  to  operations  in  the range  of  $10,000,000  to
         $12,000,000,  primarily  for  inventory  and  fixed  asset
         write-offs,  employee severance, and other costs  incurred
         in  connection with the shutdown of the remainder  of  the
         hardware  development business.  The Company will continue
         to  sell  hardware products from other vendors,  including
         SGI, and to perform hardware maintenance services for  its
         installed customer base.  However, the Company anticipates
         that revenues from both of these sources will continue to
         decline over time as hardware will no longer be a primary
         focus of the Company.

             INTERGRAPH CORPORATION AND SUBSIDIARIES
             MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS

SUMMARY
-------

Discontinued Operation. In fourth quarter 1999, the Company  sold
its   VeriBest  operating  segment.  Accordingly,  the  Company's
consolidated  statements of operations for the  quarter  and  six
months  ended  June  30, 1999 reflect VeriBest's  business  as  a
discontinued  operation.   Except  where  noted  otherwise,   the
following  discussion  of  the Company's  results  of  operations
addresses only results of continuing operations. The discontinued
operation  has not been presented separately in the  consolidated
statement  of cash flows for the six months ended June 30,  1999,
and  it  is  not segregated from the related discussions.   Other
than  its  operating  losses  for  the  periods  presented,   the
discontinued operation did not have a significant impact  on  the
Company's consolidated cash flow or financial position.  See Note
2 of Notes to Consolidated Financial Statements contained in this
Form  10-Q for summarized financial information for the  VeriBest
operating segment.

Earnings.   In  second quarter 2000, the Company incurred  a  net
loss  of $.07 per share on revenues of $188 million, including  a
$.07  per  share gain on the sale of a European office  building.
In  second  quarter  1999,  the  Company  incurred  a  loss  from
continuing  operations of $.20 per share on  revenues  of  $227.1
million, including an $11.5 million ($.24 per share) gain on  the
sale  of  a  subsidiary  and  a $2.5  million  ($.05  per  share)
nonrecurring  operating charge for the resizing of  its  European
computer   hardware  sales  organization.   Exclusive  of   these
nonrecurring   charges,  the  second  quarter  2000   loss   from
operations  improved to $.06 per share from $.30  per  share  for
second  quarter  1999.  This loss improvement resulted  primarily
from  a  20%  decline  in  operating expenses  and  a  7.5  point
improvement in systems gross margin.  For the first half of 2000,
the Company incurred a net loss of $.05 per share on revenues  of
$387.4  million, including $.15 per share earned on the  sale  of
various  capital  assets,  including the aforementioned  building
sale.   For  the first half of 1999, the Company incurred  a  net
loss from continuing operations of $.52 per share on revenues  of
$471.7 million, including an $8.6 million ($.18 per share) charge
for  settlement  of  its  arbitration  proceedings  with  Bentley
Systems, Inc. (See "Arbitration Settlement" following), the  $.24
per  share  gain on the sale of a subsidiary, and  the  $.05  per
share charge for resizing of the European computer hardware sales
organization.  Exclusive of these nonrecurring charges, the first
half  2000  loss from operations improved to $.05 per share  from
$.43  per  share for first half 1999.  This improvement  was  the
result  of  an 18% decline in operating expenses and a 7.2  point
improvement  in  systems gross margin.  Though  the  Company  has
realized  considerable  improvements  in  its  operating  expense
levels  and  gross margin, they have not yet been  sufficient  to
return  the  Company to sustained profitability as the  Company's
operating results continue to be negatively impacted by operating
losses  incurred  by  the  Intergraph  Computer  Systems  ("ICS")
operating  segment, legal fees associated with the  Intel  trial,
and   temporary   duplication  of  administrative   expenses   in
connection  with  verticalization  of  the  Company's   operating
segments.

Remainder  of the Year.  The Company expects that the  industries
in  which it competes will continue to be characterized by higher
performance  and  lower  priced  products,  intense  competition,
rapidly  changing  technologies,  shorter  product  cycles,   and
development and support of software standards that result in less
specific  hardware and software dependencies by  customers.   The
Company  believes  that  its operating system  (Windows  NT)  and
hardware architecture (Intel) strategies are the correct choices.
However,  competing operating systems and products are  available
in  the  market, and competitors of the Company offer Windows  NT
and  Intel  as the systems for their products.  The  Company  has
lost  significant  market share in this generic  undifferentiated
market  due  to  the  actions  of Intel  and  has  announced  its
intentions  to  exit the hardware business.   Subsequent  to  the
close  of the second quarter, the Company completed the  sale  of
its graphics accelerator division to 3Dlabs, Inc. Ltd. and announced
an  agreement  with Silicon Graphics, Inc. with  respect  to  its
workstation  and  server business that should complete  its  exit
from   the  hardware  development  and  design  business.    (See
"Subsequent  Events" following.)  The Company  will  continue  to
sell  hardware products from other vendors through  its  vertical
operating segments and perform hardware maintenance services  for
its installed customer base.

Improvement  in the Company's operating results will continue  to
depend   on   its  ability  to  accurately  anticipate   customer
requirements  and  technological  trends  and  to   rapidly   and
continuously   develop  and  deliver  new   products   that   are
competitively  priced,  offer  enhanced  performance,  and   meet
customers' requirements for standardization and interoperability,
and  will further depend on its ability to successfully implement
its   strategic  direction,  which  includes  the  creation   and
operation  of  independent  business  units.   In  addition,  the
Company  faces significant operational and financial  uncertainty
of  unknown  duration due to its dispute with Intel.  To  achieve
and  maintain profitability, the Company must continue  to  align
its  operating expenses with the reduced levels of revenue  being
generated.

Nonrecurring Operating Charges. During 1998 and 1999, the Company
implemented various restructuring actions in an effort to restore
the Company to profitability.  For a complete discussion, see the
Company's Annual Report on Form 10-K for the year ended  December
31,  1999. Restructuring activity during the first six months  of
1999 and 2000 is discussed below.

In second quarter 1999, in response to continued operating losses
in its Intergraph Computer Systems ("ICS") operating segment, the
Company  implemented a resizing of its European computer hardware
sales  organization.  This resizing involved closing most of  the
Company's  ICS  subsidiaries  in  Europe  and  consolidating  the
European hardware sales effort within the Intergraph subsidiaries
in  that  region.  The associated cost of $2.5 million, primarily
for   employee   severance  pay,  is  included  in  "Nonrecurring
operating  charges" in the consolidated statements of  operations
for   the   quarter  and  six  months  ended   June   30,   1999.
Approximately 46 European positions were eliminated, all  in  the
sales  and  marketing  area.   The Company  estimates  that  this
resizing  has  resulted  in annual savings  of  approximately  $3
million.

Cash  outlays for severance related to the 1998 and 1999  actions
approximated $3.5 million and $.9 million in the first six months
of  2000  and  1999, respectively. At June 30,  2000,  the  total
remaining  accrued liability for severance relating to  the  1999
reductions  in force was approximately $1.4 million  compared  to
approximately $5 million at December 31, 1999.  These liabilities
are  reflected  in  "Other  accrued expenses"  in  the  Company's
consolidated balance sheets.  The related costs are  expected  to
be  paid  over  the  remainder of 2000 and  relate  primarily  to
severance  liabilities  in  European countries,  where  typically
several months are required for settlement.

Severance  payments to date have been funded from  existing  cash
balances  and  from  proceeds from the  sale  of  VeriBest.   For
further   discussion  regarding  the  Company's  liquidity,   see
"Liquidity and Capital Resources" following.

Litigation.  As further described in the Company's Annual  Report
on Form 10-K for the year ended December 31, 1999 and its Form 10-
Q for the quarter ended March 31, 2000, the Company is subject to
certain   risks  and  uncertainties  and  has  extensive  ongoing
litigation   with  Intel  Corporation.   Significant   litigation
developments during second quarter 2000 are discussed below.

Intel Litigation.  On June 4, 1999, the U.S. District Court,  the
Northern District of Alabama, Northeastern Division (the "Alabama
Court")   granted  the  Company's  September  15,   1998   motion
requesting  summary adjudication in favor of the Company  on  its
patent infringement claims and ruled that Intel has no license to
use  the  Company's Clipper patents as Intel had claimed  in  its
motion  for summary judgment.   On October 12, 1999, the  Alabama
Court reversed its June 4, 1999 order and dismissed the Company's
patent claims against Intel.  The Company is confident that Intel
has  no license to use the Clipper patents and believes that  the
court's  original decision on this issue was correct.  On October
15,  1999,  the Company appealed the Alabama Court's October  12,
1999  order.  Oral argument for this appeal was heard on June  7,
2000.  No decision has been entered.

On  March 10, 2000, the Alabama Court entered an order dismissing
the  antitrust claims of the Company against Intel, based in part
upon a February 17, 2000 decision by the Appeals Court in another
case (CSU v. Xerox).  The Company considers this dismissal to  be
in  error  and  intends to vigorously pursue its  antitrust  case
against  Intel.   On  April 26, 2000, the Company  appealed  this
dismissal  to the United States Court of Appeals for the  Federal
Circuit.

On March 17, 2000, Intel filed a series of motions in the Alabama
Court  to  dismiss  certain Alabama   state  law  claims  of  the
Company.   The Company filed its responses to Intel's motions  on
July  17, 2000, together with its own motions to dismiss  certain
Intel  counter-claims.   Intel's  responses  are  not  due  until
October  13,  2000, and no decision on either party's  motion  is
expected before fourth quarter 2000.

The trial date for this case, previously scheduled for June 2000,
has  been continued.  A formal schedule has not yet been entered,
but  the Company believes it likely that trial may be rescheduled
for the summer of 2001.

The  Company  has  other ongoing litigation,  none  of  which  is
considered to represent a material contingency for the Company at
this time.  However, any unanticipated unfavorable ruling in  any
of  these  proceedings  could  have  an  adverse  impact  on  the
Company's results of operations and cash flow.

Arbitration   Settlement.   The  Company  maintains   an   equity
ownership position in Bentley Systems, Incorporated ("BSI"),  the
developer and owner of MicroStation, a software product  utilized
in  many of the Company's software applications and for which the
Company serves as a nonexclusive distributor.  In March 1996, BSI
commenced  arbitration  against the  Company  with  the  American
Arbitration  Association,  Atlanta,  Georgia,  relating  to   the
respective  rights  of  the  companies  under  their  April  1987
Software  License  Agreement  and other  matters,  including  the
Company's  alleged  failure  to  properly  pay  to  BSI   certain
royalties  on  its  sales of BSI software products,  and  seeking
significant  damages.  On March 26, 1999,  the  Company  and  BSI
executed a Settlement Agreement and Mutual General Release  ("the
Agreement")  to settle this arbitration and mutually release  all
claims  related  to  the  arbitration or  otherwise,  except  for
certain litigation between the companies that was the subject  of
a  separate  settlement agreement and payment  for  products  and
services  obtained or provided in the normal course  of  business
since January 1, 1999.  Both the Company and BSI expressly denied
any  fault,  liability, or wrongdoing concerning the claims  that
were the subject matter of the arbitration and settled solely  to
avoid continuing litigation with each other.

Under the terms of the Agreement, the Company on April 1, 1999
made  payment  to  BSI  of  $12 million and  transferred  to  BSI
ownership of three million of the shares of BSI's Class A  common
stock  owned by the Company.  The transferred shares were  valued
at  approximately  $3.5  million on the Company's  books.   As  a
result  of the settlement, Intergraph's equity ownership  in  BSI
was   reduced  from  approximately  50%  to  approximately   33%.
Additionally, the Company had a $1.2 million net receivable  from
BSI relating to business conducted prior to January 1, 1999 which
was written off in connection with the settlement.

In  first quarter 1999, the Company accrued a nonoperating charge
to  earnings  of approximately $8.6 million ($.18 per  share)  in
connection  with  the  settlement, representing  the  portion  of
settlement costs not previously accrued.  This charge is included
in  "Arbitration  settlement" in the  consolidated  statement  of
operations for the six months ended June 30, 1999.

The $12 million payment to BSI was funded primarily from existing
cash  balances.  For further discussion regarding  the  Company's
liquidity, see "Liquidity and Capital Resources" following.

Year  2000 Issue.  The Company successfully completed all aspects
of  its  Year  2000 readiness program with respect  to  both  its
internal  systems  and its products.  As  of  the  date  of  this
filing,  the  Company  has encountered no significant  Year  2000
problems.   However,  any undetected errors  or  defects  in  the
current  product offerings of the Company or its suppliers  could
result   in   increased  costs  for  the  Company  and  potential
litigation over Year 2000 compliance issues.

The Company employed no additional resources to complete its Year
2000 readiness program, and as a result, the related costs, which
were  funded  from operations and expensed as incurred,  did  not
have  a material impact on its results of operations or financial
condition.   Year  2000  related  changes  in  customer  spending
patterns  have  not  had,  and are not  anticipated  to  have,  a
material impact on the Company's orders or revenues.

ORDERS/REVENUES
---------------

Orders.   Second quarter and first half 2000 systems and services
orders  totaled  $173.6  million and $316 million,  respectively,
reflecting  declines of approximately 10% and 14% from  the  same
prior  year  periods.  Second quarter and first half 1999  orders
included  $4.5 million and $8.4 million, respectively, in  orders
of  the  Company's discontinued VeriBest operation.  U.S.  orders
declined  by  7% and 13%, respectively, and international  orders
declined  by  13% and 14%, respectively, from the second  quarter
and  first  half 1999 levels.  The orders decline  is  attributed
primarily  to  the  weakening demand for the  Company's  hardware
products  as  the result of the Company's decision to  exit  this
market,  though  weakness  was noted in  the  Company's  software
segments  as well.  The Company believes the weakness in software
orders  is due in part to transitioning to vertical units in  the
software  businesses, but may also be related  to  the  announced
exit  from the hardware business.  Second quarter orders improved
by  22% from the first quarter 2000 level.  International orders,
particularly in Europe, have also been adversely affected by  the
strengthening of the U.S. dollar. The Company estimates that this
strengthening of the dollar resulted in an approximate 2% decline
in  its reported systems and services orders from the first  half
1999 level.

Revenues.  Total revenues for second quarter and first half  2000
were $188 million and $387.4 million, respectively, down 17%  and
18%, respectively, from the comparable prior year periods due  to
the expected decline in hardware revenues and first quarter order
softness in the vertical software businesses.  Sales outside  the
U.S. represented approximately 53% of total revenues for the  six
months ended June 30, 2000, up from 51% for the comparable  prior
year  period  and  52%  for  the  full  year  1999,  despite  the
strengthening of the dollar.  European revenues comprised 28%  of
total  revenues for first half 2000 compared to 31% for the first
half and full year 1999.

Systems.   Systems revenue for the second quarter and first  half
of 2000 was $123.2 million and $257.6 million, respectively, down
20%  from  the  comparable  prior year  periods.   Factors  cited
previously  as  contributing to the decline in orders  have  also
adversely  affected systems revenues, and competitive  conditions
manifested  in  declining  per  unit  sales  prices  continue  to
adversely  affect  the  Company's systems  revenues  and  margin.
Systems  revenues  in Europe, the U.S., and the Americas  (Canada
and  Latin  America) declined by 31%, 22%, and 16%, respectively,
from  first  half  1999 levels, while MidWorld and  Asia  Pacific
systems   revenues   increased  by  23%  and  8%,   respectively.
Excluding  the impact of a stronger dollar, the European  revenue
decline  was 24%. Asia Pacific revenues, however, were positively
impacted  by  weakening of the dollar against the  currencies  of
that  region.  The improvement in MidWorld revenues is attributed
primarily to sales made by Z/I Imaging, a 60%-owned subsidiary of
the Company formed in fourth quarter 1999.

Hardware revenues for the first half of 2000 declined by 34% from
the comparable prior year period.  Unit sales of workstations and
servers  were  down  68%, while workstation and  server  revenues
declined  by 57%, as the average per unit selling price increased
by 35%.  The Company has announced that it will exit the hardware
development  and  design business and has  taken  actions  in  an
effort to complete this exit by the end of 2000.  See "Subsequent
Events"  following.  Software revenues declined by 16%  from  the
first  half  1999  level.   Declines in sales  of  plant  design,
information  management, photogrammetry and  government  software
were  partially offset by a significant improvement in  sales  of
Geomedia  software.  Plant design remains the  Company's  highest
volume  software  offering, representing 29%  of  total  software
sales for the first half of 2000.

Maintenance. Revenue from maintenance of Company systems  totaled
$41.5  million for the second quarter and $83.8 million  for  the
first  half  of  2000,  down 9% and 12%, respectively,  from  the
comparable  prior  year  periods. This decline  was  concentrated
primarily  in  the U.S. and Europe.  The trend  in  the  industry
toward  lower  priced  products and longer warranty  periods  has
resulted  in  reduced  levels  of maintenance  revenue,  and  the
Company believes this trend will continue in the future.

Services. Services revenue, consisting primarily of revenues from
Company  provided training and consulting, totaled $23.2  million
for  the  second quarter and $46 million for the  first  half  of
2000,  down 14% and 16%, respectively, from the comparable  prior
year  periods  with the largest declines occurring in  the  U.S.,
Europe,   and   MidWorld.   Services  are  becoming  increasingly
significant to the Company's business, representing approximately
12%  of  total revenue for the second quarter and first  half  of
2000.   The Company is endeavoring to grow its services  business
and  has  redirected  efforts to focus  increasingly  on  systems
integration.   Revenues from these services,  however,  typically
fluctuate significantly from quarter to quarter and produce lower
gross margins than systems or maintenance revenues.

GROSS MARGIN
------------

The  Company's  total gross margin for second  quarter  2000  was
36.7%, up 3.5 points from the second quarter 1999 level.  For the
first  half of 2000, total gross margin was 36.5%, up 3.8  points
from  the  first half of 1999 and 4.8 points from the  full  year
1999 level.

Systems  margin for the second quarter was 38%,  up  2.1  points
from  the first quarter level and 7.5 points from second quarter
1999.   First half 2000 systems margin was 36.9 %, up 7.2 points
from  first  half 1999 and 6.9 points from the full  year  1999.
The  upward  trend in the Company's systems margin is  primarily
due  to an increasing software content in the product mix as the
Company's  hardware revenues continue to decline.  Additionally,
Z/I Imaging, a subsidiary formed in fourth quarter 1999, has had
a  positive impact on the Company's systems margin due  to  high
margins  earned on sales of reconnaissance cameras.   Full  year
1999  systems  margin was negatively impacted by  a  $7  million
inventory  write-off incurred in connection with  the  Company's
decision to exit the PC and generic server businesses.

In  general,  the Company's systems margin may be improved  by  a
higher  software content in the product mix, a weaker U.S. dollar
in  international markets, a higher mix of international  systems
sales  to  total  systems  sales, and  reductions  in  prices  of
component parts, which generally tend to decline over time in the
industry.  Systems margins may be lowered by price competition, a
higher  hardware  content in the product  mix,  a  stronger  U.S.
dollar  in  international markets, the effects  of  technological
changes on the value of existing inventories, and a higher mix of
federal  government sales, which generally produce lower  margins
than  commercial sales.  While unable to predict the effects that
many of these factors may have on its systems margin, the Company
expects  continued improvement as the Company completes its  exit
of   the   hardware  development  and  design  business,  derived
primarily  from an increased software content in the product  mix
and  a  reduction  in inventory carrying and obsolescence  costs.
However,  third quarter 2000 margins will be negatively  impacted
by  a  one  time charge to write down the value of any  inventory
remaining  after the exit from the hardware development  business
is  complete.   Due to a number of uncertainties associated  with
this  exit,  including closing of the transaction with  SGI,  the
Company is at present unable to estimate the amount of the charge
that  will  be incurred.  Additionally, the Company continues  to
expect pressure on its systems margin as the result of increasing
industry price competition.

Maintenance margin for the second quarter of 2000 was 45.8%, down
5.1  points  from  the  second quarter of  1999.   Year  to  date
maintenance  margin is 46.2%, down 3 points from the  same  prior
year period and up .2 points from the full year 1999 level.   The
decline  from first half 1999 is due primarily to the decline  in
revenues discussed previously.  The Company continues to  monitor
its  maintenance  cost  closely and has taken  certain  measures,
including reductions in headcount, to align these costs with  the
current level of revenue.  The Company believes that the trend in
the  industry  toward lower priced products and  longer  warranty
periods  will continue to curtail its maintenance revenue,  which
will  pressure maintenance margin in the absence of corresponding
cost reductions.

Services margin for the second quarter of 2000 was 13.8%, down  5
points  from  the second quarter of 1999.  Year to date  services
margin  is  16.3%,  down 5.5 points from the corresponding  prior
year period and up .3 points from the full year 1999 level.   The
decline  from first half 1999 is due primarily to the decline  in
services   revenue  from  the  prior  year  period.   Significant
fluctuations  in  services revenues and margins  from  period  to
period  are  not  unusual as the incurrence of costs  on  certain
types  of service contracts may not coincide with the recognition
of  revenue.  For contracts other than those accounted for  under
the  percentage-of-completion  method,  costs  are  expensed   as
incurred,  with  revenues recognized either at  the  end  of  the
performance  period  or  based  on milestones  specified  in  the
contract.   Year  to  date  2000  margins  have  been  negatively
impacted   by  a  large  services  contract  which   is   nearing
completion.   Costs  continue to be incurred, but  the  remaining
revenue  on  the  contract will not be recognized until  contract
completion, which is anticipated to occur in third quarter 2000.

OPERATING EXPENSES
------------------

Operating  expenses, exclusive of nonrecurring charges,  for  the
second  quarter and first half of 2000 declined by 20%  and  18%,
respectively,  from  the  comparable  prior  year  periods.    In
response  to  the level of its operating losses, the Company  has
taken  various actions, including employee terminations and sales
of  unprofitable  business  operations,  to  reduce  its  average
employee  headcount by approximately 18% from  first  half  1999.
Sales and marketing expense for the second quarter and first half
of  2000  declined by 30% and 28%, respectively,  from  the  same
prior  year periods as the result of reductions in headcount  and
reduced  public  relations expenses.   The  Company's  sales  and
marketing  expenses  are inherently activity  based  and  can  be
expected   to  fluctuate  with  activity  levels.   General   and
administrative expense for the second quarter and first  half  of
2000  decreased by 18% and 10%, respectively, from the same prior
year  periods  due to a decline in legal fees as  the  result  of
reduced activity related to the Intel litigation and a decline in
European   compensation  expenses  as  the  result   of   reduced
headcount.   The  Company expects that its  legal  expenses  will
continue to fluctuate with the activity level associated with the
Intel  trial.   Additionally,  the  Company  is  experiencing   a
temporary duplication of administrative expenses in the  U.S.  in
connection with its efforts to verticalize its operating segments
and   decentralize  portions  of  the  corporate   administrative
function.   The Company expects that these expenses will  decline
by  the  end of 2000.  Product development expense for the second
quarter  was  basically flat with the second quarter  1999  level
while such expense for the first half of 2000 declined by 4% from
the  corresponding prior year period.  The decline from the first
half  1999  level  was primarily the result  of  the  decline  in
headcount.

NONOPERATING INCOME AND EXPENSE
-------------------------------

Interest expense was $1.1 million for the second quarter and $2.3
million  for the first half of 2000 versus $1.4 million and  $2.8
million,  respectively, for the corresponding prior year periods.
The Company's average outstanding debt has declined in comparison
to  the  same  prior year periods due primarily to  repayment  of
borrowings   utilizing  proceeds  from  the  sales   of   various
businesses  and  assets.  See "Liquidity and  Capital  Resources"
following  for  a  discussion of the Company's current  financing
arrangements.

In  April 1999, the Company sold InterCAP Graphics Systems, Inc.,
a  wholly-owned subsidiary, to Micrografx, a global  provider  of
enterprise  graphics software, for $12.2 million,  consisting  of
$3.9  million  in  cash  received at closing,  deferred  payments
received in September and October 1999 totaling $2.5 million, and
a  $5.8 million convertible subordinated debenture due March 2002
(included in "Other assets" in the June 30, 2000 and December 31,
1999  consolidated balance sheets).  The resulting gain  on  this
transaction  of  $11.5 million is included in "Gain  on  sale  of
assets"  in  the  consolidated statements of operations  for  the
quarter  and six months ended June 30, 1999.  InterCAP's revenues
and   losses  for  1998  were  $4.7  million  and  $1.1  million,
respectively,  ($3.6 million and $1.9 million for 1997).   Assets
of the subsidiary at December 31, 1998 totaled $1.6 million.  The
subsidiary  did  not  have  a material effect  on  the  Company's
results of operations for the period in 1999 prior to its sale.

"Other income (expense) - net" in the consolidated statements  of
operations   consists  primarily  of  interest  income,   foreign
exchange  gains  and  losses, and other  miscellaneous  items  of
nonoperating income and expense.  Significant items  included  in
this  amount  for the first half of 2000 are gains  on  sales  of
capital assets of $7.2 million, including a $1.5 million gain  on
termination of a long-term capital lease (see Note 10 of Notes to
Consolidated Financial Statements contained in this  Form  10-Q),
and  a foreign exchange loss of $1.5 million.  Similar items  for
the  first half of 1999 include gains on sales of capital  assets
of $1.4 million and an exchange loss of $2.4 million.

IMPACT OF CURRENCY FLUCTUATIONS AND CURRENCY RISK MANAGEMENT
------------------------------------------------------------

Fluctuations  in  the value of the U.S. dollar  in  international
markets can have a significant impact on the Company's results of
operations.  For the first half of 2000, approximately  53%  (52%
for  the  full year 1999) of the Company's revenues were  derived
from  customers  outside  the United  States,  primarily  through
subsidiary  operations.  Most subsidiaries sell to customers  and
incur  and pay operating expenses in local currency.  These local
currency revenues and expenses are translated to U.S. dollars for
reporting  purposes.  A stronger U.S. dollar  will  decrease  the
level  of reported U.S. dollar orders and revenues, decrease  the
dollar  gross margin, and decrease the reported dollar  operating
expenses  of the international subsidiaries.  For the first  half
of  2000, the U.S. dollar strengthened on average from its  first
half  1999  level,  which  decreased  reported  dollar  revenues,
orders,  and  gross  margin, but also decreased  reported  dollar
operating  expenses in comparison to the prior year period.   The
Company  estimates that this strengthening of the U.S. dollar  in
its   international  markets,  primarily  in  Europe,  negatively
impacted its results of operations for the first half of 2000  by
approximately $.05 per share in comparison to the first  half  of
1999.

The  Company  conducts business in all major markets outside  the
U.S.,  but the most significant of these operations with  respect
to   currency  risk  are  located  in  Europe  and  Asia.   Local
currencies  are  the  functional  currencies  for  the  Company's
European   subsidiaries.   The  U.S.  dollar  is  the  functional
currency for all other international subsidiaries.  With  respect
to  the currency exposures in these regions, the objective of the
Company  is  to  protect against financial  statement  volatility
arising  from changes in exchange rates with respect  to  amounts
denominated for balance sheet purposes in a currency  other  than
the  functional currency of the local entity.  The  Company  will
therefore  enter  into  forward  exchange  contracts  related  to
certain  balance sheet items, primarily intercompany receivables,
payables, and formalized intercompany debt, when a specific  risk
has  been  identified.  Periodic changes in the  value  of  these
contracts  offset exchange rate related changes in the  financial
statement  value of these balance sheet items.  Forward  exchange
contracts,  generally  less than three months  in  duration,  are
purchased  with  maturities reflecting  the  expected  settlement
dates  of  the  balance sheet items being  hedged,  and  only  in
amounts  sufficient to offset possibly significant currency  rate
related  changes  in the recorded values of these  balance  sheet
items, which represent a calculable exposure for the Company from
period  to  period.   Since this risk is  calculable,  and  these
contracts  are purchased only in offsetting amounts, neither  the
contracts themselves nor the exposed foreign currency denominated
balance  sheet items are likely to have a significant  effect  on
the  Company's financial position or results of operations.   The
Company  does  not generally hedge exposures related  to  foreign
currency  denominated assets and liabilities that are not  of  an
intercompany   nature,  unless  a  significant  risk   has   been
identified.   It  is  possible  that  the  Company  could   incur
significant  exchange gains or losses in the case of significant,
abnormal  fluctuations in a particular currency.  By policy,  the
Company   is  prohibited  from  market  speculation  via  forward
exchange contracts and therefore does not take currency positions
exceeding its known financial statement exposures, and  does  not
otherwise trade in currencies.

At  December  31,  1999, the Company's only  outstanding  forward
contracts related to formalized  intercompany loans  between  the
Company's  European  subsidiaries  and  were  immaterial  to  the
Company's  financial  position.   The  Company  had  no   forward
contracts outstanding at June 30, 2000.

Euro Conversion.  On January 1, 1999, eleven member countries  of
the European Monetary Union ("EMU") fixed the conversion rates of
their  national  currencies  to a  single  common  currency,  the
"Euro."   The national currencies of the participating  countries
will  continue  to exist through July 1, 2002, and Euro  currency
will begin to circulate on January 1, 2002.  All of the Company's
financial systems currently accommodate the Euro, and during 1999
and first half 2000, the Company conducted business in Euros with
its customers and vendors who chose to do so without encountering
significant  problems.  While the Company continues  to  evaluate
the  potential impacts of the common currency, it at present  has
not identified significant risks related to the Euro and does not
anticipate that full Euro conversion in 2002 will have a material
impact  on its results of operations or financial condition.   To
date, the conversion to one common currency has not impacted  the
Company's pricing in its European markets.

INCOME TAXES
------------

The  Company  earned pretax income of $1.3 million in  the  first
half  of 2000 versus a pretax loss from continuing operations  of
$25.1 million in the first half of 1999.  Income tax expense  for
the  first  half  of  2000  resulted  primarily  from  taxes   on
individually  profitable  majority owned subsidiaries,  including
the  Company's 60% ownership interest in Z/I Imaging.  The  first
half  1999  loss  from  continuing operations  generated  no  net
financial  statement tax benefit, as tax expenses in individually
profitable   international  subsidiaries  offset  available   tax
benefits.   There was no material income tax expense  or  benefit
related to the Company's discontinued operation.

RESULTS BY OPERATING SEGMENT
----------------------------

In  second  quarter  2000,  Intergraph  Computer  Systems  earned
operating  income  of $.5 million on revenues of  $52.8  million,
compared to a second quarter 1999 operating loss of $12.8 million
on  revenues of $86.1 million.  Year-to-date, ICS has incurred an
operating  loss  of $3.6 million on revenues of  $111.4  million,
compared  to  an operating loss of $19.5 million on  revenues  of
$179.4  million  for  first half 1999.  These  operating  results
exclude  the impact of certain nonrecurring income and  operating
expense  items  associated with ICS's operations,  including  the
nonrecurring operating charges of $2.5 million incurred in second
quarter  1999.   ICS's operating loss improvement for  the  first
half  of  2000 resulted primarily from an approximate 47% decline
in  operating  expenses  as the result  of  headcount  reductions
achieved  in 1999.  During 1999, ICS's headcount was  reduced  by
approximately  35%  as  the result of employee  terminations  and
attrition, with the majority of the reductions occurring  in  the
sales  and  marketing area.  Although total revenues declined  by
38%,  ICS's gross margin improved 4.2 points to 18.1%  for  first
half  2000.  In second quarter 2000, ICS's gross margin  improved
to 21.8%, resulting in breakeven results for the quarter.  Income
earned  for  the  quarter  was  primarily  attributable  to   the
Intense3D  graphics division of ICS.  The ICS business  has  been
significantly adversely impacted by factors associated  with  the
Company's  dispute with Intel.  (See the Company's Annual  Report
on  Form 10-K for the year ended December 31, 1999 for a complete
discussion of the Company's dispute with Intel and its effects on
the  operations  of ICS and the Company.) As a result,  in  first
quarter  2000, the Company announced its intention  to  exit  the
hardware  development  and design business.   Subsequent  to  the
close  of the second quarter, the Company completed the  sale  of
ICS's Intense3D graphics accelerator division to 3Dlabs, Inc. and
announced  an agreement with Silicon Graphics, Inc. with  respect
to ICS's workstation and server business that should complete its
exit  from  the  hardware development and design business.   (See
"Subsequent  Events" following.)  The Company  will  continue  to
sell  hardware products from other vendors through  its  vertical
operating segments and perform hardware maintenance services  for
its installed customer base.  Effective with the shutdown of ICS,
the  Company's  hardware maintenance operation will  be  combined
with Intergraph Government Solutions.

In second quarter 2000, Intergraph Public Safety earned operating
income of $1.1 million on revenues of $21.7 million, compared  to
operating  income  in  second quarter 1999  of  $3.3  million  on
revenues   of  $24.7  million.   Year-to-date,  IPS  has   earned
operating  income  of $2.6 million on revenues of  $43.6  million
versus  operating  income  of $5.2 million  on  revenues  of  $46
million  in  first  half  1999.  Improvements  in  the  segment's
systems and maintenance margins were offset by a 28% increase  in
operating  expenses.  In anticipation of increasing  orders,  the
Utilities  division  of  IPS  has  increased  its  headcount   by
approximately  30% from the first half 1999 level,  primarily  in
the product development and marketing areas.  Additionally, IPS's
general  and administrative expenses have increased by  24%  from
the prior year period due to legal expenses incurred in Australia
for an inquiry related to a large contract award.  It is too soon
to tell whether this inquiry will result in a legal proceeding of
any  significance with respect to the IPS operating segment.  The
IPS  business is characterized by large orders that are difficult
to  forecast  and cause revenues to fluctuate significantly  from
quarter  to quarter.  Second quarter 2000 was negatively impacted
by  negotiation delays on several projects.  Orders and  revenues
are expected to increase during the second half of the year.

In  second  quarter  2000,  the  Software  business  incurred  an
operating  loss  of  $1.5 million on revenues of  $87.6  million,
compared to second quarter 1999 operating income of $4.1  million
on  revenues  of  $118.4  million.   Year-to-date,  the  Software
business has earned operating income of $2 million on revenues of
$181.5  million  versus  operating  income  of  $7.5  million  on
revenues  of $243.9 million in first half 1999.  These  operating
results  exclude  the impact of certain nonrecurring  income  and
operating  expense  items  associated with  Software  operations,
including  the first quarter 1999 arbitration settlement  accrual
of  $8.6 million and the second quarter 1999 gain on the sale  of
InterCAP  of $11.5 million.  Although total gross margin remained
flat  with the first half 1999 level at  approximately 40%, a 26%
decline  in  revenues  resulted in  a  significant  reduction  in
operating  income,  and  in  an operating  loss  for  the  second
quarter.  The impact of the revenue decline was partially  offset
by  a  20% decline in operating expenses from the first half 1999
level.   During  1999,  the segment reduced and  reorganized  its
sales  force  to align its expenses more closely with  the  lower
volume of revenue being generated.

Intergraph Government Solutions earned operating income  of  $1.4
million  on revenues of $37.3 million in second quarter 2000  and
$39.8  million in second quarter 1999.  Year-to-date,  Government
Solutions has earned operating income of $4.9 million on revenues
of $76.6 million, compared to operating income of $5.6 million on
revenues of $82.5 million in first half 1999.  Though first  half
revenues  declined by 7% from the prior year period, total  gross
margin  improved  by  3.1  points  to  24.3%,  due  primarily  to
improvements  in  the segment's systems margins.   However,  this
improvement  was offset by a 16% increase in operating  expenses,
primarily  the  result  of increased general  and  administrative
expense  resulting from verticalization of the operating segment,
including implementation of a new accounting system, and from  an
increase  in bad debt expenses from the corresponding prior  year
period.

In  second  quarter 2000, Z/I Imaging earned operating income  of
$2.5 million on revenues of $11.4 million.  Year-to-date, Z/I has
earned  operating  income of $5.2 million on  revenues  of  $23.4
million.  This was the segment's third full quarter of operations
since its inception on October 1, 1999.  Prior to October 1999, a
portion  of this business was included in the Intergraph Software
operating segment.  The Company believes the associated  revenues
and  operating  income for the second quarter and first  half  of
1999  were  insignificant to the Software  segment  as  a  whole.
Systems revenues were higher than expected for the first half  of
2000 as sales of reconnaissance cameras were strong.  Total gross
margin  for the second quarter and first half of 2000  was  56.3%
and  54.2%, respectively, reflecting the high margins  earned  on
software as well as on sales of reconnaissance cameras.

See  Note  12  of Notes to Consolidated Financial Statements  for
further   explanation  and  details  of  the  Company's   segment
reporting.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

At  June  30, 2000, cash totaled $92.5 million compared to  $88.5
million  at  December 31, 1999.  Cash generated by operations  in
the  first  half  of  2000  totaled $17 million,  compared  to  a
consumption of $4.1 million in the first half of 1999.  The first
half 2000 cash generation reflects the Company's improved results
of  operations  and  increased focus on  collection  of  accounts
receivable.   The first half 1999 cash consumption  included  the
$12   million   payment  to  BSI  (See  "Arbitration  Settlement"
preceding.)

Net  cash generated by investing activities totaled $1.9  million
in  the  first  half  of 2000, compared to  a  $2.5  million  net
generation  in the first half of 1999. First half 2000  investing
activities  included $16.7 million in proceeds from the  sale  of
capital  assets.   First half 1999 investing activities  included
$24.6  million in proceeds from sales of assets, including  $19.9
million  in  proceeds from the fourth quarter 1998  sale  of  the
Company's   manufacturing  assets  (See  Note  8  of   Notes   to
Consolidated  Financial Statements contained in this  Form  10-Q)
and  $3.1  million  net proceeds from the sale  of  the  InterCAP
subsidiary.    Other  significant  first  half   2000   investing
activities  included  expenditures  for  capitalizable   software
development costs of $8.5 million ($9.6 million in the first half
of  1999) and capital expenditures of $4.2 million ($5.7  million
in  the  first  half of 1999), primarily for Intergraph  products
used in hardware and software development and sales and marketing
activities.   The Company expects that capital expenditures  will
require  $8 to $10 million for the full year 2000, primarily  for
these  same  purposes.   The Company's term  loan  and  revolving
credit  agreement contains certain restrictions on the  level  of
the Company's capital expenditures.

Net  cash used for financing activities totaled $12.1 million  in
the  first  half of 2000, compared to $16.5 million in the  first
half  of  1999.  Net debt repayments during first half  2000  and
1999  totaled  $13  million and $17.9 million, respectively.   In
first  half  2000, the Company used approximately $7  million  to
repay  its  Australian term loan and $4 million to  pay  off  the
mortgage on a disposed European office building.  First half 1999
activity  relates  primarily  to  the  Company's  term  loan  and
revolving credit agreement.

An  additional  reduction  in the Company's  long-term  debt  was
achieved through the termination of a long-term lease on  one  of
the  Company's  facilities in first quarter  2000.   The  Company
accounted  for  this lease as a financing, and upon  termination,
long-term debt of $8.3 million and property, plant, and equipment
of $6.5 million were removed from the Company's books.

Under  the  Company's January 1997 six year fixed term  loan  and
revolving  credit agreement, available borrowings are  determined
by  the amounts of eligible assets of the Company (the "borrowing
base"),   as   defined  in  the  agreement,  primarily   accounts
receivable,  with maximum availability of $80 million.   The  $25
million  term loan portion of the agreement is due at  expiration
of  the  agreement.   Borrowings  are  secured  by  a  pledge  of
substantially all of the Company's assets in the U.S. and certain
international   receivables.   The  rate  of  interest   on   all
borrowings  under  the  agreement is the greater  of  7%  or  the
Norwest Bank Minnesota National Association base rate of interest
(9.5%  at June 30, 2000) plus .625%, and there are provisions  in
the  agreement that will lower the interest rate upon achievement
of   sustained  profitability  by  the  Company.   The  agreement
requires the Company to pay a facility fee at an annual  rate  of
 .15%  of  the amount available under the credit line,  an  unused
credit  line fee at an annual rate of .25% of the average  unused
portion  of the revolving credit line, and a monthly agency  fee.
At  June 30, 2000, the Company had outstanding borrowings of  $25
million (the term loan) which are classified as long-term debt in
the  consolidated balance sheet, and an additional $23.6  million
of  the  available  credit  line was  allocated  to  support  the
Company's  letters of credit and forward exchange contracts.   As
of  this  same date, the borrowing base, representing the maximum
available credit under the line, was approximately $64.2 million.

The  term  loan  and revolving credit agreement contains  certain
financial covenants of the Company, including minimum net  worth,
minimum   current   ratio,   and  maximum   levels   of   capital
expenditures,  and restrictive covenants that  limit  or  prevent
various  business  transactions  (including  repurchases  of  the
Company's stock, dividend payments, mergers, acquisitions  of  or
investments in other businesses, and disposal of assets including
individual businesses, subsidiaries, and divisions) and limit  or
prevent  certain other business changes without  approval.    The
Company's  net  worth  covenant  was  reduced  to  $200   million
effective  June  30, 2000.  Additionally, the agreement  required
the  Company  to  retain, pending a return to profitability,  the
services  of  an  investment banking firm to advise  the  Company
regarding    potential   partnering   arrangements   and    other
alternatives   for   its   computer  hardware   business.    This
requirement was waived in second quarter 2000.

At  June  30, 2000, the Company had approximately $40 million  in
debt  on  which  interest is charged under various floating  rate
arrangements,  primarily  its six year term  loan  and  revolving
credit agreement and a European mortgage.  The Company is exposed
to  market  risk of future increases in interest rates  on  these
loans.

The  Company has generated positive operating cash flow  for  the
third  consecutive  quarter, primarily  the  result  of  improved
accounts  receivable collections and operating expense  declines.
The  Company expects to sustain this improvement in its operating
cash  flows  throughout 2000 as a result of headcount  reductions
and other expense savings actions taken during 1999.  The Company
is   managing  its  cash  very  closely  and  believes  that  the
combination  of improved cash flow from operations, its  existing
cash  balances,  and  cash available under its  revolving  credit
agreement  will be adequate to meet cash requirements  for  2000.
However,  the  Company  must  continue  to  align  its  operating
expenses with the reduced levels of revenue being generated if it
is  to  fund  its  operations  and build  cash  reserves  without
reliance on funds from external financing.  For the longer  term,
the  Company anticipates no significant nonoperating events  that
will require the use of cash.

SUBSEQUENT EVENTS
-----------------

On July 21, 2000, the Company completed the sale of the Intense3D
graphics  accelerator  division  of  ICS  to  3Dlabs,  Inc.  Ltd.
("3Dlabs"),  a  leading  supplier  of  integrated  hardware   and
software  graphics  accelerator solutions  for  workstations  and
design  professionals.  As initial consideration for the acquired
assets, 3Dlabs issued to the Company approximately 3.6 million of
its common shares with an aggregate market value of approximately
$13.2  million  on  the  date  of closing.   The  agreement  also
contains  an  earn-out  provision based  on  various  performance
measures  for  Intense3D operations for  the  remainder  of  2000
following  the July 1 effective date of the sale.  This  earn-out
provides  an  opportunity for additional proceeds of  up  to  $25
million,  payable in stock and/or cash at the option  of  3Dlabs.
The Company expects to record a pretax gain from initial proceeds
of  the  sale of approximately $9 million in third quarter  2000.
Full  year  1999  third-party revenue for the Intense3D  division
approximated   $38  million,  with  operating   results   at   an
approximate breakeven level.

On  July  21, 2000, the Company announced its intent  to  form  a
strategic  alliance  with  Silicon  Graphics,  Inc.  ("SGI"),   a
worldwide  provider  of high-performance computing  and  advanced
graphics  solutions,  in which SGI will acquire  certain  of  the
Company's  hardware business assets, including ICS's Zx10  family
of  workstations and servers.  Under the proposed  alliance,  the
Company  will  become  a  reseller for SGI  and  will  offer  its
application  solutions on the SGI platform.  In  connection  with
this agreement, the Company plans to purchase $100 million in SGI
products and services over a three year period.  The terms of the
sale  are still being finalized.  The transaction is expected  to
close  in  third quarter 2000.

These two transactions signal completion of the Company's exit of
the  development,  design, and manufacture of hardware  products,
allowing  the Company's operating segments to focus on  providing
software, systems integration, and services to the industries  in
which  Intergraph is a market leader.  Upon completion  of  these
transactions, the Company expects to incur a nonrecurring  charge
to  operations  in  the  range of $10  million  to  $12  million,
primarily  for  inventory  and fixed asset  write-offs,  employee
severance,  and  other  costs incurred  in  connection  with  the
shutdown  of the remainder of the hardware development  business.
The  Company will continue to sell hardware products  from  other
vendors,  including  SGI,  and  to perform  hardware  maintenance
services for its installed customer base.  However, the Company
anticipates that revenues from both of these sources will continue
to decline over time as hardware will no longer be a primary focus
of the Company.


             INTERGRAPH CORPORATION AND SUBSIDIARIES


Item  3:  Quantitative and Qualitative Disclosures About Market Risk
          ----------------------------------------------------------

          The  Company  has experienced no material  changes  in
          market  risk  exposures that affect the  quantitative  and
          qualitative  disclosures presented in the  Company's  Form
          10-K filing for its year ending December 31, 1999.


PART II.  OTHER INFORMATION
          -----------------

  Item 1:  Legal Proceedings
           -----------------

           On  June  4, 1999, the U.S. District Court, the  Northern
           District  of Alabama, Northeastern Division (the "Alabama
           Court")  granted the Company's September 15, 1998  motion
           requesting  summary adjudication in favor of the  Company
           on  its  patent infringement claims and ruled that  Intel
           has  no  license to use the Company's Clipper patents  as
           Intel  had  claimed  in its motion for summary  judgment.
           On  October 12, 1999, the Alabama Court reversed its June
           4,  1999 order and dismissed the Company's patent  claims
           against  Intel.  The Company is confident that Intel  has
           no  license to use the Clipper patents and believes  that
           the  court's original decision on this issue was correct.
           On  October  15, 1999, the Company appealed  the  Alabama
           Court's  October 12, 1999 order.  Oral argument for  this
           appeal  was heard on June 7, 2000.  No decision has  been
           entered.

           On  March  10, 2000, the Alabama Court entered  an  order
           dismissing  the  antitrust claims of the Company  against
           Intel, based in part upon a February 17, 2000 decision by
           the  Appeals  Court in another case (CSU v. Xerox).   The
           Company  considers  this dismissal to  be  in  error  and
           intends  to vigorously pursue its antitrust case  against
           Intel.   On  April  26, 2000, the Company  appealed  this
           dismissal to the United States Court of Appeals  for  the
           Federal Circuit.

           On March 17, 2000, Intel filed a series of motions in the
           Alabama Court to dismiss certain Alabama state law claims
           of  the  Company.   The Company filed  its  responses  to
           Intel's  motions on July 17, 2000, together with its  own
           motions to dismiss certain Intel counter-claims.  Intel's
           responses  are  not due until October 13,  2000,  and  no
           decision  on  either  party's motion is  expected  before
           fourth quarter 2000.

           The  trial  date for this case, previously scheduled  for
           June 2000, has been continued.  A formal schedule has not
           yet been entered, but the Company believes it likely that
           trial may be re-scheduled for the summer of 2001.

Item  4:  Submission of Matters to a  Vote  of  Security Holders
          ------------------------------------------------------

          Intergraph   Corporation's   Annual    Meeting    of
          Shareholders  was held on May 18, 2000.   The  results  of
          the meeting follow.

          (1) Eight  directors  were elected  to  the  Board  of
              Directors  to  serve  for the ensuing  year  and  until
              their  successors are duly elected and qualified.   All
              nominees,  with the exceptions of Lawrence R. Greenwood
              and  Joseph C. Moquin, were serving as Directors of the
              Company  at  the  time  of  their  nomination  for  the
              current year.

                                                   Votes
                                         ----------------------------
                                            For      Against/Withheld
                                         ----------  ----------------
              Lawrence R. Greenwood      45,823,980       830,823
              Larry J. Laster            45,906,553       748,250
              Thomas J. Lee              45,908,066       746,737
              Sidney L. McDonald         45,896,840       757,963
              James W. Meadlock          42,790,825     3,863,978
              Joseph C. Moquin           45,813,149       841,654
              James F. Taylor Jr.        45,912,701       742,102
              Robert E. Thurber          45,243,240     1,411,563

          (2) The  2000  Intergraph Corporation  Employee  Stock
              Purchase  Plan  was  approved by a vote  of  26,867,573
              for,   1,124,907  against,  126,324  abstentions,   and
              18,535,999 broker non-votes.

          (3) Ratification  of the appointment of Ernst  &  Young
              LLP  as  the  Company's independent  auditors  for  the
              current year was approved by a vote of 46,492,241  for,
              76,342 against, and 86,220 abstentions.

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

      (a) Exhibit 27, Financial Data Schedule

      (b) There  were no reports on Form 8-K filed during the quarter
          ended June 30, 2000.


             INTERGRAPH CORPORATION AND SUBSIDIARIES
                           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.



                     INTERGRAPH CORPORATION
                     ----------------------
                          (Registrant)




By: /s/ James F. Taylor Jr.         By: /s/ John W. Wilhoite
   ------------------------            ----------------------------
   James F. Taylor Jr.                 John W. Wilhoite
   Chief Executive Officer             Executive Vice President and
                                       Chief Financial Officer
                                       (Principal Financial and
                                       Accounting Officer)

Date:  August 11, 2000              Date:  August 11, 2000