FORM 10-QSB

________________________________________________


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


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


      For the quarterly period ended March 31, 1997.

Commission File No.  1-8129.


US 1 INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)


          Indiana                                            95-3585609
(State of Incorporation)                  (I.R.S. Employer Identification No.) 



   1000 Colfax, Gary, Indiana                                   46406
(Address of principal executive offices)                      (Zip Code)

Registrant's telephone number, including area code: (219) 944-6116

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 ___


As of May 4, 1997, there were 10,573,780 shares of common stock were 
outstanding.


TOTAL OF SEQUENTIALLY
NUMBERED PAGES:    13


Part I


Item 1. FINANCIAL STATEMENTS.


US 1 INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
MARCH 31, 1997 (UNAUDITED) AND DECEMBER 31, 1996

ASSETS
                                                      March 31,    December 31,
                                                         1997           1996
                                                     (Unaudited)    
CURRENT ASSETS:                                                               
   Cash                                             $   196,564    $   225,541
   Account receivable--trade less allowance for                              
     doubtful accounts of $55,675 and $50,000         2,549,940      1,501,947
   Other receivables                                    450,957        136,648
   Deposits                                             154,267        153,892
   Prepaid expenses                                     102,429        116,476
                                                    ------------   ------------
      Total current assets                            3,454,157      2,134,504
                                                    ------------   ------------
FIXED ASSETS:                                                                  
   Equipment                                             30,935         17,193
   Less accumulated depreciation and amortization        (4,702)        (7,682)
                                                    ------------   ------------
      Net fixed assets                                   26,233          9,511
                                                    ------------   ------------
ASSETS HELD FOR SALE:                                                          
   Land                                                 195,347        195,347
   Valuation allowance                                 (141,347)      (141,347)
                                                    ------------   ------------
      Net assets held for sale                           54,000         54,000
                                                    ------------   ------------
TOTAL ASSETS                                        $ 3,534,390    $ 2,198,015
                                                    ============   ============


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





US 1 INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
MARCH 31, 1997 (UNAUDITED) AND DECEMBER 31, 1996

LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIENCY)

                                                      March 31,    December 31,
                                                         1997          1996
                                                     (Unaudited)
CURRENT LIABILITIES:                                                          
   Accounts payable                                 $ 3,221,456    $ 2,722,897
   Accrued expenses                                     165,461        152,098
   Short-term debt                                    2,719,003      1,769,146
   Insurance and claims                                 294,796        252,153
   Accrued interest                                      70,882         46,880
   Accrued compensation                                  22,171         32,428
   Estimated fuel and other taxes                       105,649        174,377
                                                     -----------    -----------
      Total current liabilities                       6,599,418      5,149,979
                                                     -----------    -----------
LONG-TERM DEBT                                          512,081        521,160
 
REDEEMABLE PREFERRED STOCK,
     authorized 5,000,000 shares; no par value,
     Series A shares outstanding: 1,094,224 
     Liquidation preference $0.3125 per share.          706,758        691,541

SHAREHOLDERS' EQUITY (DEFICIENCY):                                         

   Common stock authorized 20,000,000 shares;                                 
     no par value; shares outstanding 10,573,780.    40,824,296     40,824,296
   Accumulated deficit                              (45,108,163)   (44,988,961)
                                                    ------------    ----------
      Total shareholders' equity (deficiency)        (4,283,867)    (4,164,665)
                                                    ------------    ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY          $ 3,534,390    $ 2,198,015
                                                    ============   ===========


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


US 1 INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 1997 AND 1996 (UNAUDITED)

                                                     1997            1996
                                                                    
OPERATING REVENUES                              $ 4,484,339     $ 3,646,991
                                                -----------     -----------
OPERATING EXPENSES:                                                       
   Purchased transportation                       3,392,279       2,735,985
   Insurance and claims                             178,847         125,048
   Salaries, wages, and other                       280,282         121,461
   Commissions                                      426,100         328,912
   Operating supplies and expense                   193,010         185,200
   Operating taxes and licenses                      31,240          35,267
   Communications and utilities                      28,937          16,843
   Rents                                             23,171          13,000
   Depreciation and amortization                      1,349             471
                                                ------------    ------------
     Total operating expenses                     4,555,215       3,562,187
                                                ------------    ------------
OPERATING INCOME                                    (70,876)         84,804
                                                ------------    ------------
NON-OPERATING INCOME (EXPENSE):                                           
   Interest income                                                      445
   Interest expense                                 (60,555)        (67,480)
   Other income                                      27,445          30,450
                                                ------------    ------------
     Total non-operating (expense)                  (33,110)        (36,585)
                                                ------------    ------------

NET INCOME (LOSS)                               $  (103,986)    $    48,219
                                                ============    ============
                                                                          
EARNINGS (LOSS) PER COMMON SHARE                $     (0.01)    $       .00
                                                ============    ============
                                                                            
WEIGHTED AVERAGE NUMBER OF COMMON SHARES         10,573,780       9,829,336
                                                ============    ============
         
The accompanying notes are an integral part of the consolidated financial 
statements.



US 1 INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(UNAUDITED)

                                                   Three Months Ended March 31, 
                                                           1997         1996
                                                                             
CASH FLOWS FROM OPERATING ACTIVITIES:                                        
                                                                             
Net Income (loss)                                       $(103,986)   $  48,219
Adjustments to reconcile net income (loss) to net                            
  cash provided from (used for) operations:                                   
  Depreciation and amortization                             1,349          472
  Changes in operating assets and liabilities:                                
    Accounts receivable - trade                        (1,047,993)     (79,796)
    Other receivables                                    (314,309)     (93,170)
    Prepaid assets                                         14,047       18,391
    Deposits                                                 (375)         122
    Accounts payable                                      498,559       93,093
    Accrued expenses                                       13,363      (14,307)
    Accrued interest                                       38,454       (8,323)
    Insurance and claims                                   42,643        9,251
    Other accrued compensation                            (24,709)      (4,579)
    Fuel and other taxes                                  (68,728)     (33,337)
    Other                                                                 (186)
                                                        ----------   ----------
   Net Cash (used for) operating activities              (951,685)     (64,150)
                                                        ----------   ----------
                                                                               
CASH FLOWS FROM INVESTING ACTIVITIES:                                          
  Additions to property and equipment                     (18,071)             
                                                        ----------   ----------
                                                                               
   Net cash (used for) investing activities               (18,071)             
                                                        ----------   ----------
CASH FLOWS FROM FINANCING ACTIVITIES:                                          
  Net borrowings under line of credit                     693,930       27,866
  Proceeds from other related party loans                 246,849      127,457
                                                        ----------   ----------
   Net cash provided from financing activities            940,779      155,323
                                                        ----------   ----------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS      (28,977)      91,173
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD            225,541       53,602
                                                        ----------   ----------
CASH AND CASH EQUIVALENTS, END OF PERIOD                $ 196,564    $ 144,775
                                                        ==========   ==========

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


US 1 INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
THREE MONTHS ENDED MARCH 31, 1997 AND 1996


1. BASIS OF PRESENTATION

The accompanying consolidated balance sheet as of March 31, 1997 and the 
consolidated statements of operations and cash flows for the three month 
periods ended March 31, 1997 and 1996 are unaudited, but, in the opinion of 
management, include all adjustments (consisting of normal, recurring accruals) 
necessary for a fair presentation of the financial position and the results of 
operations for such periods.  The year-end balance sheet data was derived from 
audited financial statements.  These statements should be read in conjunction 
with the Company's audited consolidated financial statements for the year ended 
December 31, 1996 and the notes thereto included in the Company's annual report 
on Form 10-KSB.  Certain information and footnote disclosures normally included 
in financial statements prepared in accordance with generally accepted 
accounting principles have been omitted, as permitted by the requirements of 
the Securities and Exchange Commission, although the Company believes that the 
disclosures included in these financial statements are adequate to make the 
information not misleading.  The results of operations for the three months 
ended March 31, 1997 and 1996 are not necessarily indicative of the results for 
a full year.


2. GOING CONCERN

The accompanying consolidated financial statements have been prepared assuming 
that the Company will continue as a going concern.  The Company has experienced 
operating losses and negative cash flows in recent years.  At March 31, 1997 
and December 31, 1996, the Company's current liabilities exceeded its current 
assets by $3.1 million and $3.0 million, respectively.  The Company's future 
depends heavily on raising the capital to fund operations until its revenue 
grows and generates sufficient cash flows to satisfy its indebtedness.  Revenue 
growth and the resulting improved cash flows would enable the Company to reduce 
its third party debt and improve its working relationships with potential 
agents and independent contractors.  The Company is exploring options to raise 
capital and various other potential transactions.  Recent poor results, a 
significant decrease in cash flows from operations, and inability to remain in 
compliance with financial covenants with its lenders, continue to raise 
substantial doubts about the Company's ability to continue as a going concern.  
The financial statements do not include any adjustments that might result from 
the outcome of this uncertainty.




US 1 INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


3.  SHORT-TERM DEBT

Short-term debt at March 31, 1997 and December 31, 1996 comprises:

	                                       
	                                      March 31,        December 31,
	                                        1997               1996    
	                                     ----------         ---------- 
Line of credit                             $1,746,778         $1,052,734 
Current portion of long-term debt              61,612             61,612 

Due to August Investment Partnership          100,000            100,000
Due to Antonson/Kibler                        810,613            554,800 
	                                     ----------         ---------- 
Total                                $2,719,003         $1,769,146 
	                                     ==========         ========== 

Under its revolving line of credit agreement the Company may borrow up to a 
maximum of $3,000,000.  Borrowings are limited to 80% of eligible accounts 
receivable and bear interest at the prime rate (8.25% at March 31, 1997 and 
December 31, 1996, respectively) plus 3.25%.  Advances under the line of credit 
agreement are collateralized by the Company's accounts receivable, property and 
other assets.  The agreement expires in May 1997.  The Company and the lender 
are currently in the process of extending the line of credit for multiple years 
although no final agreement has been approved.

The line of credit is subject to termination upon various events of default, 
including failure to remit timely payments of interest, fees and principal, any 
adverse change in the business of the Company or the insecurity of the lender 
concerning the ability of the Company to repay its obligations as and when due 
or failure to meet certain financial covenants.  Financial covenants include: 
minimum net worth requirements, total debt service coverage ratio, capital 
expenditure limitations, restrictions on compensation levels of key officers, 
and prohibition of additional indebtedness without prior authorization.  As of 
December 31, 1996, the Company was in violation of the debt service coverage 
ratio covenant.  At March 31, 1997, it is in violation of the debt service 
coverage ratio and the net worth covenants.  As a result, the lender may 
declare the commitment terminated and demand payment.  Management does not 
expect the lender to terminate the agreement before it expires.

Other-- Outstanding loans from the President of the Company and another General 
Partner of August Investment Partnership (the Company's largest shareholders, 
Kibler and Antonson) were $810,613 and $554,800 at March 31, 1997 and December 
31, 1996, respectively.  The interest rate on these loans approximates the 
prime rate (8.25%) at March 31, 1997 and December 31, 1996, respectively.  
August Investment Partnership loaned the Company $100,000 during the quarter 
ended September 30, 1995.  The interest rate on this loan is the prime rate 
plus .75% (9.0%) at March 31, 1997 and December 31, 1996, respectively.



US 1 INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


4.  LONG-TERM DEBT

Long-term debt at March 31, 1997 and December 31, 1996 comprises:

                                                     March 31,   December 31,
                                                       1997          1996
                                                     ---------   ------------ 

Mortgage note payable to August Investment
 Partnership collateralized by land, 
 interest at prime + .75%, interest only
 payments required, principal balance due
 July 31, 1999                                       $250,000       $250,000

Mortgage note payable to AIFE,
 collateralized by land, interest at 9%,
 monthly repayments of $5,000, including
 interest, remaining principal balance
 due July 31, 1999                                    232,293        239,372

TIP trailer settlement payments on principal
 only of $1,000 per month, principal due
 February, 2003                                        91,400         93,400
                                                     --------       -------- 
     Total debt                                       573,693        582,772
Less current portion                                   61,612         61,612
                                                     --------       -------- 
Total long-term debt                                 $512,081       $521,160
                                                     ========       ========

US 1 INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


5.  COMMITMENTS  AND CONTINGENCIES

Over the past few years, the Company has had a significant number of lawsuits 
instituted or threatened against it as a result of its poor financial condition 
and its inability to meet certain financial obligations.  For the most part, 
these suits have been settled through cash payments of a reduced amount or 
through the institution of payment plans.  The undisputed claims that have not 
been settled are reflected as liabilities in the Company's financial statements 
and are included in accrued expenses in the accompanying consolidated balance 
sheets.  The litigation that currently is pending include:

McCormick v. Trailblazer.  Mr. McCormick, the owner of C.A. White Trucking 
Company ("White"), filed an action on October 1, 1993, alleging that 
Trailblazer failed to make required payments under an employment contract.  
Trailblazer did not make the payments as a result of a dispute related to 
undisclosed liens on assets purchased from White.  The Company has lost this 
suit, however, Trailblazer was closed in 1994 and has no funds to pay the 
judgment.  The suit has since been brought against US 1.  The Company is 
vigorously defending this action.

Simpson V. Keystone Lines--Mr. Simpson, an independent owner-operator leased to 
Keystone Lines, is claiming an amount in excess of $25,000 for injuries he 
sustained to his back while working for the Company.  The Company is vigorously 
defending against this claim on the basis that Mr. Simpson was not an employee 
and is not entitled to a workers compensation claim.

Cam Regional Transport, Inc., Miller, Pry v. Trailblazer, Transcon 
Incorporated.  Mr. Miller and Mr. Pry owners of Cam Regional Transport, Inc., 
filed an action in 1994, alleging that Trailblazer failed to make required 
payments under an employment contract and purchase agreement alleging damages 
of $293,000.  Trailblazer ceased to make the payments as a result of a dispute 
related to their employment and inability to obtain title to the assets 
purchased.  The Company is vigorously defending the action.

In December 1996, Trailblazer Transportation, a subsidiary of Keystone Lines, 
filed for protection from its creditors under the bankruptcy laws.  At March 
31, 1997, Trailblazer's liabilities exceeded its assets.

The Company believes it has adequately reserved for the above claims, however, 
additional liability is possible and the ultimate disposition of these claims 
may have a material adverse effect to the Company's results of operations, cash 
flows and financial position.

The Company carries insurance for public liability and property damage, and 
cargo loss and damage through various programs. The Company's insurance 
liabilities are based upon the best information currently available and are 
subject to revision in future periods as additional information becomes 
available.  Management believes it has adequately provided for insurance 
claims.





Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATION.

Results of Operations

The financial statements and related notes contained elsewhere in this Form 10-
QSB and in the Company's Form 10-KSB for its fiscal year ended December 31, 
1996 are essential to an understanding of the comparisons and are incorporated 
by reference into the discussion that follows.


Period 1997 Compared to 1996

The Company's operating revenues increased from $3.6 million for the first 
quarter of 1996 to $4.5 million for the same period in 1997.  The Company's 
operating revenues are generated principally from its truckload carrier, 
Keystone, who generates sales through independent agents who originate 
shipments that then are transported by independent contractors who own their 
own equipment.  The increase in operating revenues resulted from the addition 
of Carolina National Transportation in January 1997 and Gulf Line 
Transportation in December 1997.  These additions also resulted in the increase 
in accounts receivable from December 31, 1996 to March 31, 1997.

Total operating expenses increased from $3.6 million for the period ended March 
31, 1996 to $4.6 million for the same period in 1997.  The largest component of 
operating expenses is purchased transportation, which generally varies in 
proportion to operating revenues at approximately 77%.  Purchased 
transportation increased from $2.7 million in 1996 to $3.4 million in 1997.  
Commissions increased from $0.3 million in 1996 to $0.4 million in 1997.  
Commissions vary in proportion to operating revenues.  Insurance and claims, 
which increased from $0.1 million in 1996 to $0.2 million for 1997, similarly 
vary in proportion to operating revenues, although they also depend on claims 
experience.  The remaining operating expenses increased from $0.2 in 1996 to 
$0.4 million for 1997.

Other expense decreased from $36,000 for the first quarter of 1996 to $33,000 
for the first quarter of 1997 and consists primarily of interest expense.  
Interest expense varies in proportion to the Company's outstanding interest-
bearing indebtedness which decreased during 1997 as the result of lower FINOVA 
borrowing on Keystone receivables and the repayment of the Landair note of 
$200,000 at December 31, 1996.

The Company started two new operations, Carolina National Transportation in 
January 1997 and Gulf Line Transportation in December 1996.  The costs of these 
startups resulted in a first quarter loss of approximately $0.1 million, which 
affected the overall operating results for the first quarter of 1997.  Overall 
operating results for the first quarter of 1997 decreased to $0.1 million loss 
from a gain $0.05 million in 1996. 







Future Prospects

The Company's management remains optimistic about its future prospects.  
Revenue for each month in the first quarter of 1997 has increased over revenue 
in the prior month.  In addition, the Company started two new operations at the 
beginning of 1997, Carolina National Transportation and Gulf Line 
Transportation.  The Company has also retained Bob Brettin, a former president 
of Keystone Lines, to assist it.  However, the Company's future depends on 
increasing its revenues, its ability to resolve its cash flow problems, and 
bringing its new operations to profitability.


Liquidity and Capital Resources

As of March 31, 1997, the Company's financial position remains precarious.  The 
Company had a deficit in shareholders' equity of $4.3 million and its current 
liabilities of $6.6 million exceeded its current assets by $3.1 million.  As 
described above, the Company has experienced significant revenue declines, 
operating losses in prior years and losses from discontinued operations leaving 
the Company in its current position.  The Company's borrowing from the partners 
of AIP and the Company's president to alleviate the current cash shortages has 
enabled the Company to continue in operation.  While the Company's current 
situation is not good, current growth plans are designed to grow the Company 
while remaining profitable which should enable it to improve its liquidity 
position.

The Company continues to suffer from negative cash flows from operations 
although the negative cash flow increased from a negative of $.06 million 
during the first quarter of 1996 to a negative $.95 million during the same 
period of 1997.  Cash flow was provided by borrowing $0.25 million from the 
Company's president and a partner of AIP and by borrowing $0.7 million from 
FINOVA.  This borrowing reduced the net negative cash flow to $0.03 million for 
the quarter ended March 31, 1997

The Company's principal source of outside liquidity is its $3 million line of 
credit with FINOVA.  The availability of the line of credit is based on 80% of 
Keystone's eligible accounts receivable and 75% of the Carolina National 
eligible accounts receivable.  At March 31, 1997, the outstanding borrowings 
were $1.7 million, which essentially was the entire amount that the Company was 
eligible to borrow.  The line of credit expires on May 31, 1997. The Company 
and the lender are currently in the process of extending the line of credit for 
multiple years although no final agreement has been approved.  The Company is 
currently in violation of several covenants of the lender, although as part of 
the extension these covenants are expected to be modified.
 
Shareholders and potential investors in the Company are cautioned that the 
Company's financial condition remains precarious and that the favorable 
compromise of the Company's various lawsuits and an increase in operating 
performance remain essential to its long-term survival.  Unfortunately, there 
can be no assurance that these goals will be achieved.




PART II. OTHER INFORMATION


Item 6(b).  Reports on Form 8-K

     No Reports on Form 8-K have been filed during the quarter.



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 there unto duly authorized.


US 1 Industries, Inc.



                   
Michael E. Kibler
                                               
President



                                                                
James C. Day
Chief Financial Officer

May 15, 1997

 




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