5
                              
      UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                   WASHINGTON, D.C. 20549
                          FORM 10-Q
                       AMENDMENT NO. 1

(Mark One)


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


For the quarterly period ended October 3, 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:               33-80701



                       AAF-MCQUAY INC.
   (Exact name of Registrant as Specified in Its Charter)
                              
                              
        Delaware                             41-0404230
(State or Other Jurisdiction of                   (I.R.S.
Employer Identification No.)
Incorporation or Organization)


111 South Calvert Street, Baltimore, Maryland
21202
(Address of Principal Executive Offices)
(Zip Code)



Registrant's telephone number, including area code     (410)
528-2755


                         Not applicable
Former Name, Former Address and Former Fiscal Year, if
Changed Since Last Report.
                              

Indicate by check 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 latest
practicable date:  2,497 shares of Common Stock, par value
$100.00 per share, were outstanding as of November 9, 1998.

                      INDEX                             
                                                        
         AAF-MCQUAY INC. AND SUBSIDIARIES               
                                                      Page
                                                        
Part II - Other Information.................           3
                                                        
Item 6.  Exhibits and Reports on Form 8-               3
K.........................................
                                                        
                                                       4
Signatures........................................
 ......................................

PART II:  OTHER INFORMATION

Item 6.  Exhibits and Reports on Form 8-K

          (a)  Exhibits      
          
            Number           Description
                             
          Exhibit 10.2       Divestment  Incentive  Program
                             Agreement  dated September  8,
                             1998 with Gerald L. Boehrs *
          Exhibit 10.3       Divestment  Incentive  Program
                             Agreement  dated September  8,
                             1998    with    Michael     J.
                             Christopher *
          Exhibit 10.4       Divestment  Incentive  Program
                             Agreement  dated September  8,
                             1998  with Andrew R.  Morrison
                             *

*     Portions of the document have been omitted pursuant to
a request for confidential treatment.  The full document has
been filed separately.

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.



                              AAF-MCQUAY INC.





DATE   February 8, 1999       By:  /S/   ANDREW R. MORRISON
                              Andrew R. Morrison
                              Chief Financial Officer

DATE   February 8, 1999            /S/   BRUCE D. KRUEGER
                              Bruce D. Krueger
                              Controller
                              (Principal Accounting Officer)
                        Exhibit Index

Number                   Description

 10.2               Divestment  Incentive  Program   Agreement
                    dated  September 8, 1998  with  Gerald  L.
                    Boehrs *
 10.3               Divestment  Incentive  Program   Agreement
                    dated  September 8, 1998 with  Michael  J.
                    Christopher *
 10.4               Divestment  Incentive  Program   Agreement
                    dated  September 8, 1998  with  Andrew  R.
                    Morrison *


*     Portions of the document have been omitted pursuant to
a request for confidential treatment.  The full document has
been filed separately.





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