FORM 10-Q
                      SECURITIES AND EXCHANGE COMMISSION
                           WASHINGTON, D.C.  20549

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

          For the quarterly period ended:  March 31, 1998
                                      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:  1-8133
                           XEROX CREDIT CORPORATION
            (Exact name of Registrant as specified in its charter)
Delaware                                                           06-
1024525
(State or other jurisdiction of                              (I.R.S. 
Employer
incorporation or organization)                            Identification 
No.)

100 First Stamford Place, Stamford, Connecticut                         
06904
(Address of principal executive offices)                           (Zip 
Code)

                                (203) 325-6600
             (Registrant's telephone number, including area code)
      Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class                 Name of Each Exchange on Which 
Registered

10% Notes due 1999                  New York Stock Exchange


      Securities registered pursuant to Section 12(g) of the Act:  None
Indicate by check mark whether the Registrant (1) has filed all reports 
required to be filed by Section 13 or 15(d) of the Securities Exchange Act 
of 1934 during the preceding 12 months (or for such shorter period that the 
Registrant was required to file such reports), and (2) has been subject to 
such filing requirements for the past 90 days.     Yes:     X         No:
Indicate the number of shares outstanding of each of the issuer's classes of 
common stock, as of the close of the latest practicable date.

   Class                                  Outstanding as of April 30, 1998
Common Stock                                            2,000

THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTIONS 
H(1)(a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE 
REDUCED DISCLOSURE FORMAT.


                                      THIS DOCUMENT CONSISTS OF 14 PAGES



(1)
To the extent that this Form 10-Q Report contains forward-looking statements 
and information relating to the Registrant, such statements are based on the 
beliefs of management as well as assumptions made by and information 
currently available to management.  The words "anticipate," "believe," 
"estimate," "expect," "intends", "will" and similar expressions, as they 
relate to the Registrant or the Registrant's management, are intended to 
identify forward-looking statements.  Such statements reflect the current 
views of the Registrant with respect to future events and are subject to 
certain risks, uncertainties and assumptions.  Should one or more of these 
risks or uncertainties materialize, or should underlying assumptions prove 
incorrect, actual results may vary materially from those described herein as 
anticipated, believed, estimated or expected.  The Registrant does not 
intend to update these forward-looking statements.








































(2)
PART 1.   FINANCIAL INFORMATION
Item 1.   Financial Statements

                           XEROX CREDIT CORPORATION
                      CONSOLIDATED STATEMENTS OF INCOME
                                 (UNAUDITED)
                                (In Millions)

                                                           Three Months 
Ended
                                                                 March 31,
                                                              1998     1997
                                                         


Earned income:
   Contracts receivable                                     $   94   $   88
Expenses:
   Interest                                                     59       53
   Operating and administrative                                  3       _3

      Total expenses                                            62       56

Income before income taxes                                      32       32

Provision for income taxes                                      13       13


Net income                                                  $   19   $   19


See accompanying notes.






















(3)
                            XEROX CREDIT CORPORATION
                          CONSOLIDATED BALANCE SHEETS
                                 (In Millions)
                                     ASSETS
                                                      March 31,  December 
31,
                                                          1998          1997
                                                      (UNAUDITED)


Cash and cash equivalents                              $     -       $     -

Investments:
    Contracts receivable                                 5,001         4,796
    Notes receivable - Xerox and affiliates                 56            56
    Unearned income                                       (656)         
(623)
    Allowance for losses                                 _(116)         
(131)
        Total investments                                4,285         4,098

Net assets of discontinued operations                       54            58
Deferred income taxes and other assets                       1             2

        Total assets                                   $ 4,340       $ 4,158


                      LIABILITIES AND SHAREHOLDER'S EQUITY
Liabilities:
    Notes payable within one year:
      Commercial paper                                 $ 1,562      $  1,428
      Current portion of notes payable after one year      870           795
      Notes Payable - Xerox and affiliates                  66           161
    Notes payable after one year                         1,216         1,191
    Due to Xerox Corporation, net                           34            21
    Accounts payable and accrued liabilities                44            34
    Deferred income taxes                                ___21         ___20

        Total liabilities                                3,813         3,650

Shareholder's Equity:
    Common stock, no par value, 2,000 shares
        authorized, issued, and outstanding                 23            23
    Additional paid-in capital                             219           219
    Retained earnings                                      285           266

        Total shareholder's equity                         527           508

        Total liabilities and shareholder's equity     $ 4,340       $ 4,158
           



See accompanying notes.


(4)
                              XEROX CREDIT CORPORATION
                        CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
                                  (In Millions)

                                                           Three Months 
Ended
                                                                March 31,
                                                             1998      1997
Cash Flows from Operating Activities
  Net income                                               $   19    $   19
  Adjustments to reconcile net income to net cash
    (used in) provided by operating activities:
    Net change in operating assets and liabilities            (70)       12
 
Net cash (used in) provided by operating activities           (51)       31

Cash Flows from Investing Activities
  Purchases of investments                                   (656)     (513)
  Proceeds from investments                                   469       423
  Net collections from discontinued operations              _   4     _  27
 
Net cash used in investing activities                       _(183)    _ (63)

Cash Flows from Financing Activities
  Change in commercial paper, net                             134       213
  Proceeds from long-term debt                                100       100
  Principal payments on long-term debt                          -      (265)
  Dividends                                                 _   -       (16)

Net cash provided by financing activities                   _ 234     _  32


  Increase in cash and cash equivalents                         -         -

  Cash and cash equivalents, beginning of period                -         -

  Cash and cash equivalents, end of period                 $    -    $    -




See accompanying notes.











(5)
                           XEROX CREDIT CORPORATION
                  Notes to Consolidated Financial Statements
                                   (UNAUDITED)

(1)   The unaudited consolidated interim financial statements presented 
herein have been prepared by Xerox Credit Corporation (the "Company") 
in accordance with the accounting policies described in its Annual 
Report on Form 10-K for the fiscal year ended December 31, 1997 and 
should be read in conjunction with the Notes to Consolidated Financial 
Statements which appear in that report.

      In the opinion of management, all adjustments (consisting only of 
normal
      recurring adjustments) which are necessary for a fair statement of the
      operating results for the interim periods presented have been made.
      Certain prior year balances have been reclassified to conform to the
      current year presentation.

(2)   During the first three months of 1998, the Company did not redeem any
      term debt.

(3)   During the first three months of 1998, the Company sold at various 
dates
      a total of $100 million of fixed- and adjustable-rate notes which 
mature
      at various dates in 2008, 2013 and 2018 and are first callable in 
2000. 
      The interest rates on all of these notes have been swapped into LIBOR-
      based rates.

(4)   The terms of a Support Agreement with Xerox provide that the Company
      will receive from Xerox income maintenance payments, to the extent
      necessary, so that the Company's earnings shall not be less than 1.25 
      times its fixed charges.  For purposes of this calculation, both 
      earnings and fixed charges are as defined in Section 1404 (formerly 
      Section 81(2)) of the New York Insurance Law.  In addition, the 
      agreement requires that Xerox retain 100 percent ownership of the 
      Company's voting capital stock.

(5)   Effective January 1, 1998, the Company adopted Statement of Financial
      Accounting Standards No. 130, "Reporting Comprehensive Income."  This
      Statement requires that companies disclose comprehensive income, which
      includes net income, foreign currency translation adjustments, minimum
      pension liability adjustments, and unrealized gains and losses on
      marketable securities classified as available-for-sale.  For the
      Company, comprehensive income is the same as net income.











(6)
Item 2. Management's Discussion and Analysis of Financial Condition and
            Results of Operations

RESULTS OF OPERATIONS
                           Continuing Operations

     Contracts receivable income represents income earned under an agreement 
with Xerox pursuant to which the Company purchases long-term accounts 
receivable associated with Xerox' sold equipment. These receivables arise 
primarily from Xerox equipment being sold under installment sales and sales-
type leases.

     Earned income from contracts and notes receivable was $94 million and 
$88 million for the first three months of 1998 and 1997, respectively. The 
increase was primarily due to a larger average portfolio of contracts 
receivable in 1998 than in 1997. This increase was partially offset by a $1 
million decrease in income earned on intercompany receivables.

     Interest expense increased to $59 million in the first quarter of 1998 
from $53 million in the same period in 1997.  The increase is due to a 
larger average portfolio of contracts receivable which was slightly offset 
by a lower average interest rate and lower discontinued operations net 
assets (see page 7).

     Since substantially all of the Company's contracts receivable earn 
fixed rates of interest, the Company "match funds" the contracts by swapping 
variable-rate commercial paper and medium term notes into fixed interest 
rates for specified maturities.  This practice is employed because it 
effectively "locks in" a spread and eliminates the risk of shrinking 
interest margins in a rising interest rate environment.  Conversely, this 
practice effectively eliminates the opportunity to increase margins when 
interest rates are declining.  The Company intends to continue to match its 
contracts receivable and indebtedness to ensure an adequate spread between 
interest income and interest expense.

     Operating and administrative expenses were $3 million for the first 
quarter of 1998 and 1997. These expenses are incurred to administer the 
contracts receivable purchased from Xerox.

     The effective income tax rate for the first three months of 1998 and 
1997 was 40.6 percent.
                           Discontinued Operations

     Since their discontinuance in 1990, the Company has made substantial 
progress in disengaging from the third party financing and real estate 
businesses.  Through March 31, 1998, the Company has received net cash 
proceeds of $2,574 million from the sale of discontinued business units, 
asset securitizations, asset sales, and run-off collection activities.  The 
amounts received have been consistent with the Company's estimates in its 
disposal plan and were primarily used to reduce the Company's indebtedness.



(7)
     During the first quarter of 1998, the Company reduced its net assets of 
discontinued operations by $4 million, primarily through contractual 
maturities and cash sales.

     A significant portion of the remaining $54 million portfolio represents 
passive lease receivables with long-duration contractual maturities and 
unique tax attributes.  Accordingly, the Company expects that the wind-down 
of the portfolio will continue to be a gradual process.  The Company 
believes that the liquidation of the remaining assets will not result in a 
net loss.

CAPITAL RESOURCES AND LIQUIDITY

     The Company's principal sources of funds are cash from the collection 
of Xerox contracts receivable and borrowings.

     Net cash used in operating activities was $51 million in the first 
three months of 1998 compared to $31 million provided by operating 
activities during the same period in 1997. The change was primarily due to 
decreased intercompany balances in the first quarter of 1998.

     Net cash used in investing activities was $183 million in the first 
three months of 1998 compared to $63 million in the first three months of 
1997.  The increase was the result of more contracts receivable purchased in 
1998 than in 1997 offset partially by higher collections due to growth in 
the contracts receivable base.  Lower cash collections resulting from the 
sale of discontinued assets and the fact that some of the discontinued 
assets reached their contractual maturities also contributed to the increase 
in 1998.

     Net cash provided by financing activities was $234 million during the 
first three months of 1998 compared to $32 million provided by financing 
activities during the same period in 1997. The increase resulted primarily 
from the fact that no principal payments were required to be made with 
respect to long-term debt and no dividends were paid in the first quarter of 
1998 as compared to the first quarter of 1997.

     At March 31, 1998, the Company had registered domestic shelf capacity 
of $1,775 million.  In addition, a $2 billion Euro-debt facility is 
available to the Company, Xerox, Xerox Capital (Europe) plc, and Xerox 
Overseas Holdings Limited, of which $1,193 million was unused at March 31, 
1998.

     The Company and Xerox have joint access to a $7 billion revolving 
credit agreement with various banks which expires in 2002.  Up to $4 billion 
of this revolver is also accessible by Xerox Capital (Europe) plc and Xerox 
Overseas Holdings Limited. Any amounts borrowed under this facility would be 
at rates based, at the borrower's option, on spreads above certain LIBOR 
reference rates.







(8)
     The Company believes that cash provided by continuing operations, 
funding available through its commercial paper program supported by its 
committed credit facility, and its readily available access to the capital 
markets are more than sufficient to enable the Company to meet its liquidity 
needs.  New borrowing associated with the financing of customer purchases of 
Xerox equipment will continue in 1998 and decisions regarding the size and 
timing of any new term debt financing will be made based on cash flows, 
match funding needs, refinancing requirements and capital market conditions.

     The Company is exposed to market risk from changes in interest rates 
that could affect results of operations and financial condition.  To assist 
in managing its interest rate exposure and match funding its principal 
assets, the Company routinely enters into certain financial instruments, 
primarily interest rate swap agreements. In general, the Company's objective 
is to hedge its variable-rate debt by paying fixed rates under the swap 
agreements while receiving variable rate payments in return.  Additionally, 
in order to manage its outstanding commercial paper, the Company 
opportunistically issues variable- and fixed-rate medium term notes which 
are swapped to attractive LIBOR-based rates.  The Company does not enter 
into derivative instrument transactions for trading purposes and employs 
long-standing policies prescribing that derivative instruments are only to 
be used to achieve a set of very limited objectives.

     During the first three months of 1998, the Company entered into 
interest rate swap agreements which effectively converted $432 million of 
variable-rate debt into fixed-rate debt.  These agreements mature at various 
dates through 2003 and resulted in a weighted average interest rate of 5.71 
percent.  The Company also entered into interest rate swap agreements during 
the first quarter of 1998 which effectively converted $100 million of fixed- 
and adjustable-rate debt into variable-rate debt indexed to LIBOR rates.  
These agreements mature in 2008, 2013 and 2018, and all are cancelable by 
the respective counterparties on interest payment dates beginning in 2000.  
Cancellation dates within the swap agreements conform to exercise dates of 
call options embedded in the Company's fixed- and adjustable-rate debt.

     The Company's interest rate hedging is typically unaffected by changes 
in market conditions as swaps are normally held to maturity consistent with 
the Company's objective to lock in interest rate spreads on the underlying 
transactions.

     As of March 31, 1998, the debt-to-equity ratio was 7.0 to 1, consistent 
with the Company's guideline for this ratio.










(9)

PART II.  OTHER INFORMATION

Item 1.   Legal Proceedings

          None.

Item 6.   Exhibits and Reports on Form 8-K

          (a)   Exhibits

                Exhibit 3  (a) Articles of Incorporation of Registrant filed
                               with the Secretary of State of Delaware on 
                               June 23, 1980.

                               Incorporated by reference to Exhibit 3(a) to
                               Registration Statement No. 2-71503.

                           (b) By-Laws of Registrant, as amended through
                               September 1, 1992.

                               Incorporated by reference to Exhibit 3 (b)
                               to Registrant's Quarterly Report for the
                               Quarter ended March 31, 1997.

                Exhibit 12 (a) Computation of the Company's Ratio of 
Earnings
                               to Fixed Charges.

                           (b) Computation of Xerox' Ratio of Earnings to
                               Fixed Charges.

                Exhibit 27  Financial Data Schedule (Electronic Form Only)

          (b)   Reports on Form 8-K.

                None
















(10)


      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.

                             XEROX CREDIT CORPORATION



                             BY______________________

                             George R. Roth, Vice President,
                             Treasurer and Chief Financial Officer

                             May 12, 1998







































(11)