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 1-06124

                      LONE STAR INDUSTRIES, INC.
        (Exact name of registrant as specified in its charter)
                                 	
			   DELAWARE    			 No. 13-0982660
         (State or other jurisdiction of	(I.R.S. Employer
	    incorporation or organization) 	Identification No.)

300 First Stamford Place, P.O. Box 120014, Stamford, CT  06912-0014
        (Address of principal executive offices)    (Zip Code)

Registrant's telephone number, including area code   203-969-8600

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 by check mark whether the registrant has filed all 
documents and reports required to be filed by Sections 12, 13 or 
15(d) of the Securities Exchange Act of 1934 subsequent to the 
distribution of securities under a plan confirmed by a court.

                   Yes   X             No       

The number of shares outstanding of each of the registrant's 
classes of common stock as of April 28, 1998:

       Common Stock, par value $1 per share - 10,713,450 shares
 

 
 




TABLE OF CONTENTS


	
												PAGE


PART I.	FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS
Consolidated Statements of Operations - For the
   Three Months Ended March 31, 1998 and 1997 
   (Unaudited)...........................................3

Consolidated Statements of Retained Earnings -            
   For the Three Months Ended March 31, 1998 and 
   1997 (Unaudited)......................................4 

Consolidated Balance Sheets - March 31, 1998
   (Unaudited) and December 31, 1997.....................5

Consolidated Statements of Cash Flows - For the 
   Three Months Ended March 31, 1998 and 1997
   (Unaudited)...........................................6

Notes to Unaudited Consolidated Financial Statements.....7

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF 
FINANCIAL CONDITION AND RESULTS OF OPERATIONS...........13

PART II.	OTHER INFORMATION.......................................17

SIGNATURES.........................................................18






PART I.  FINANCIAL INFORMATION
ITEM 1.  FINANCIAL STATEMENTS

<TABLE>
<CAPTION>

LONE STAR INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(In Thousands Except Per Share Amounts)


                                     
                                      For the Three Months               
                                      Ended March 31,                 
                                                      1998              1997    
 <S>                                                     <C>              <C>
                                                    
Consolidated Income                                            
Revenues:                                                                  
 Net sales                                          $ 57,794         $ 60,836
 Joint venture income                                    823              742
 Other income, net                                     3,769              674
                                                      62,386           62,252
                                                              
Deductions from revenues:                                     
 Cost of sales                                        38,903           46,183
 Selling, general and administrative expenses          6,732            7,704
 Depreciation and depletion                            5,346            6,253
 Interest expense                                        747            1,714 
                                                      51,728           61,854
                                                               
Income before income taxes                            10,658              398

Provision for income taxes                            (3,597)            (134)
                                                                
Net income applicable to common stock               $  7,061         $    264 
                                                              
Weighted average common shares outstanding:
 Basic                                                10,716           10,853
 Diluted                                              13,540           13,094
                                                              
Earnings per common share:                          
 Basic                                              $   0.66         $   0.02
 Diluted                                            $   0.52         $   0.02 
 
The accompanying Notes to Unaudited Consolidated Financial Statements are an 
integral part of the Financial Statements.

</TABLE>










<TABLE>
<CAPTION>

LONE STAR INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF RETAINED EARNINGS(Unaudited)
(In Thousands)




                                           For the Three Months             
                                            Ended March 31,                  
                                                       1998             1997  
<S>                                                     <C>               <C>
                                                               
Retained earnings, beginning of period             $  178,444      $  115,228
                                                                   
Net income                                              7,061             264 
                                                               
Dividends                                                (527)           (547)
                                                               
Retained earnings, end of period                   $  184,978      $  114,945 


</TABLE>
   

The accompanying Notes to Unaudited Consolidated Financial Statements are an 
integral part of the Financial Statements.























<TABLE>
<CAPTION>

 LONE STAR INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEETS
(In Thousands)


                                                      March 31,   December 31,
                                                        1998          1997  
                                                     (Unaudited)   
    <S>                                                  <C>           <C>

Assets:                                                          
   Current assets:                                                
    Cash including cash equivalents of $145,163                  
     and $152,775                                    $  145,366    $  154,080
    Accounts and notes receivable, net                   26,284        28,217
    Inventories:                                                 
      Finished goods                                     24,920        14,850
      Work in process and raw materials                   9,610         6,417
      Supplies and fuel                                  21,217        21,836
                                                         55,747        43,103
    
    Deferred tax asset                                    3,825         3,825 
    Other current assets                                  3,730         3,751
      Total current assets                              234,952       232,976 
                                                                 
   Joint ventures                                        20,899        20,326
                                                                 
   Property, plant and equipment                        382,939       368,248
   Less accumulated depreciation and depletion           74,151        68,993
                                                        308,788       299,255
    
   Deferred tax asset                                    36,196        37,661 
   Other assets and deferred charges                     10,132         8,759
      Total assets                                   $  610,967    $  598,977   
                                                                 
                                                                 
Liabilities and Shareholders' Equity:                         
   Current Liabilities:                                        
    Accounts payable                                 $   21,132    $   13,400
    Accrued liabilities                                  43,418        46,417
    Other current liabilities                             4,615         3,565
      Total current liabilities                          69,165        63,382
                                                                 
 
   Senior notes payable                                  50,000        50,000
   Postretirement benefits other than pensions          123,278       123,728
   Other liabilities                                     28,318        28,233
   Contingencies (See Notes 7 and 8) 		      		                
                                             
      Total liabilities                                 270,761       265,343

Shareholders' Equity:                                            
  Common stock                                           12,093        12,092
  Warrants to purchase common stock                      15,428        15,554
  Additional paid-in capital                            175,071       174,915
  Retained earnings                                     184,978       178,444 
  Treasury stock, at cost                               (47,364)      (47,371)
      Total shareholders' equity                        340,206       333,634
      Total liabilities and shareholders' equity     $  610,967    $  598,977
                                                                
</TABLE>
                           
The accompanying Notes to Unaudited Consolidated Financial Statements are an 
integral part of the Financial Statements. 








<TABLE>
<CAPTION>

LONE STAR INDUSTRIES, INC. 
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(In Thousands)


                                        For the Three Months               
                                          Ended March 31,                    
                                                       1998             1997   
  <S>                                                   <C>             <C>
                                                               
Cash Flows from Operating Activities:                          
                                                               
Net income                                         $    7,061      $      264
Adjustments to arrive at net cash provided 
 (used) by operating activities:                                         
  Depreciation and depletion                            5,346           6,253 
  Deferred income taxes                                 1,465             134 
  Changes in operating assets and liabilities:                 
    Accounts and notes receivable                       2,009           1,431   
    Inventories and other current assets              (12,552)         (7,311)
    Accounts payable and accrued liabilities            5,148          (4,305)
  Equity income, net of dividends received               (573)           (242)
  Pension funding (in excess of) less than
   expense                                               (330)            428 
  Gain on sale of a surplus property                   (1,500)             -  
  Other, net                                             (891)           (577)
Net cash provided (used) by operating activities        5,183          (3,925)
                                                               
Cash Flows from Investing Activities:                          
                                                                
Capital expenditures                                  (15,889)        (10,080)
Proceeds from sale of assets                            2,495           9,448
Net cash used by investing activities                 (13,394)           (632)
                                                               
Cash Flows from Financing Activities: 
                         
Proceeds from issuance of long-term senior notes          -            50,000
Redemption of long-term senior notes                      -           (28,000)
Proceeds from exercise of warrants                         24              16
Dividends paid                                           (527)           (547)
Proceeds from exercise of options                         -             4,342
Net cash (used) provided by financing activities         (503)         25,811
                                                                             
Net (decrease) increase in cash and cash 
 equivalents                                           (8,714)         21,254 
                                                               
Cash and cash equivalents, beginning of period        154,080          71,215 
Cash and cash equivalents, end of period           $  145,366      $   92,469 
                                                                                
</TABLE>

The accompanying Notes to Unaudited Consolidated Financial Statements are an 
integral part of the Financial Statements. 


 



	NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS


Note 1

In the opinion of management, the accompanying unaudited consolidated 
financial statements contain all adjustments, which are of a normal 
recurring nature, necessary to present fairly the financial position of 
the Company as of March 31, 1998, and the results of operations and the 
cash flows for the three months ended March 31, 1998 and 1997. 

The year-end consolidated balance sheet was derived from the Company's 
audited financial statements, but does not include all disclosures 
required by generally accepted accounting principles.  The financial 
statements contained herein should be read in conjunction with the 
financial statements and related notes in the Company's annual report on 
Form 10-K for the year ended December 31, 1997. The Company's operations 
are seasonal and, consequently, interim results are not indicative of the 
results to be expected for a full year.


Note 2 - Common Stock 

In February 1998, the Board of Directors declared a $0.05 dividend per common 
share, which was paid on March 16, 1998 to shareholders of record as of March 
1, 1998.  In January 1998, pursuant to an order signed by the U.S. Bankruptcy 
Court, 14,572 shares of common stock and 31,033 warrants were returned to the 
Company.  The common stock shares have been recorded as treasury shares and 
the returned warrants have been cancelled.  There was no effect on total 
equity of the Company as a result.   


Note 3 - Supplemental Disclosures of Cash Flow Information

Cash equivalents include the Company's marketable securities which are 
comprised of short-term, highly liquid investments with original maturities 
of three months or less.  Interest paid during the three months ended March 
31, 1998 and 1997 was $1,827,000 and $4,271,000, respectively.  Income taxes 
paid during the three months ended March 31, 1998 and 1997, were $1,078,000 
and $23,000, respectively.


Note 4 - Interest

Interest expense of $945,000 and $1,926,000 has been accrued for the three 
months ended March 31, 1998 and 1997, respectively. Interest capitalized 
during the three months ended March 31, 1998 and 1997, was $198,000 and 
$212,000, respectively.


Note 5 - Earnings Per Share

In 1997, the Company adopted Statement of Financial Accounting Standards No. 
128, "Earnings Per Share" ("SFAS No. 128").  Previously reported earnings per 
share amounts have been restated.  Basic earnings per common share for the 
three months ended March 31, 1998 and 1997 are calculated by dividing net 
income by weighted average common shares outstanding during the period. 
Diluted earnings per common share for the three months ended March 31, 1998 
and 1997 are calculated by dividing net income by weighted average common 
shares outstanding during the period plus dilutive potential common shares 
which are determined as follows:

                                     For the Three Months Ended March 31,
                                               1998            1997           
 
Weighted average common shares              10,716,065      10,852,843
Effect of dilutive securities:
   Warrants                                  2,716,508       2,068,502
   Options to purchase common stock            107,136         172,371 
Adjusted weighted average common shares     13,539,709      13,093,716  

Dilutive potential common shares are calculated in accordance with the 
treasury stock method which assumes that the proceeds from the exercise of 
all warrants and options are used to repurchase common stock at market value. 
The number of shares remaining after the proceeds are exhausted represents 
the potentially dilutive effect of the securities.  


Note 6 - Sale of Assets

In February 1998, the Company recorded a gain of $1,500,000 from the sale of 
a piece of surplus real estate in Massachusetts.  The gain is included in 
other income on the accompanying consolidated statement of operations.


Note 7 - Environmental Matters    

The Company is subject to extensive, stringent and complex federal, state 
and local laws, regulations and ordinances pertaining to the quality and 
the protection of the environment and human health and safety, requiring 
the Company to devote substantial time and resources in an effort to 
maintain continued compliance. Many of the laws and regulations apply to 
the Company's former activities, properties and facilities as well as its 
current operations.  There can be no assurances that judicial or 
administrative proceedings, seeking penalties or injunctive relief, will 
not be brought against the Company for alleged non-compliance with 
applicable environmental laws and regulations relating to matters as to 
which the Company is currently unaware. For instance, if releases of 
hazardous substances are discovered to have occurred at facilities 
currently or previously owned or operated by the Company, or at facilities 
to which the Company has sent waste materials, the Company may be subject 
to liability for the investigation and remediation of such sites.  In 
addition, changes to such regulations or the enactment of new regulations 
in the future could require the Company to undertake capital improvement 
projects or to cease or curtail certain operations or could otherwise 
substantially increase the capital, operating and other costs associated 
with compliance.  For example, recent initiatives for limitations on 
carbon dioxide emissions as a result of the fear of global warming could 
result in statutes or regulations which, if promulgated, could adversely 
affect certain aspects of United States manufacturing, including the 
cement industry.

The federal Water Pollution Control Act, commonly known as the Clean Water 
Act, provides a comprehensive federal regulatory scheme governing the 
discharge of pollutants to waters of the United States. This regulatory 
scheme requires that permits be secured for discharges of wastewater, 
including stormwater runoff associated with industrial activity, to waters 
of the United States. The Company has secured or has applied for all 
required permits in connection with its wastewater and stormwater 
discharges.

The Clean Air Act was amended in 1990 to provide for a uniform federal 
regulatory scheme governing the control of air pollutant emissions and 
permit requirements. In addition, certain states in which the Company 
operates have enacted laws and regulations governing the emission of air 
pollutants and requiring permits for sources of air pollutants. As a 
result of the 1990 amendments to the Clean Air Act, the Company is 
required to apply for federal operating permits for each of its cement 
manufacturing facilities at various dates through 1999. As part of the 
permitting process, the Company may be required to install equipment to 
monitor emissions of air pollutants from its facilities. In addition, the 
Clean Air Act amendments require the United States Environmental 
Protection Agency ("EPA") to develop regulations directed at reducing 
emissions of toxic air pollutants from a variety of industrial sources, 
including the portland cement manufacturing industry. As part of this 
process, the EPA has identified maximum available control technology 
("MACT") for the reduction of emissions of air toxics from cement 
manufacturing facilities. In 1997, the EPA announced proposed MACT 
standards for those cement manufacturing facilities (like Lone Star's 
Greencastle and Cape Girardeau plants) that burn hazardous waste fuels 
("HWF").  The proposed standards are extremely lengthy and complex and 
have been commented on by concerned parties.  They are anticipated by the 
Company to be effective in late 1998 and thereafter will be implemented 
over a three-year period for companies that plan to comply.  Depending on 
their final terms when effective, they could have the effect of limiting 
or eliminating the use of HWF at one or both facilities. MACT standards 
for facilities burning fossil fuels were proposed in early 1998, and these 
standards are currently being studied by the Company.  In 1997, the EPA 
promulgated under the Clean Air Act new standards for small particulate 
matter and ozone emissions, and related testing will be carried out over 
the next several years.  Depending on the result of this testing, 
additional regulatory burdens could be imposed on the cement industry by 
states not in compliance with the regulations.  Also in 1997, the EPA 
proposed new regulations to reduce nitrogen oxide emissions substantially 
over the next eight years.  This proposal would affect 22 states including 
three in which the Company has cement plants: Indiana, Illinois and 
Missouri.  Depending on state implementation, this emissions reduction 
could adversely affect the cement industry in these states.

The Resource Conservation and Recovery Act ("RCRA") establishes a cradle-
to-grave regulatory scheme governing the generation, treatment, storage, 
handling, transportation and disposal of solid wastes. Solid wastes which 
are classified as hazardous wastes pursuant to RCRA, as well as facilities 
that treat, store or dispose of such hazardous wastes, are subject to 
stringent regulatory requirements. Generally, wastes produced by the 
Company's operations are not classified as hazardous wastes and are 
subject to less stringent federal and state regulatory requirements. 
Cement kiln dust ("CKD"), a by-product of cement manufacturing, is 
currently exempted from regulation as a hazardous waste pursuant to the 
Bevill Amendment to RCRA. However, in 1995, the EPA issued a regulatory 
determination regarding the need for regulatory controls on the 
management, handling and disposal of CKD. Generally, the EPA regulatory 
determination provides that the EPA intends to draft and promulgate 
regulations imposing controls on the management, handling and disposal of 
CKD that will be based largely on selected components of the existing RCRA 
hazardous waste regulatory program, tailored to address the specific 
regulatory concerns posed by CKD. The EPA regulatory determination further 
provides that new CKD regulations will be designed both to be protective 
of the environment and to minimize the burden on cement manufacturers. 
While it is not possible to predict at this time precisely what new 
regulatory controls on the management, handling and disposal of CKD or 
what increased costs (or range of costs) would be incurred by the Company 
to comply with these requirements, the EPA announced in 1996 that 
regulations will be promulgated through a rulemaking scheduled to be 
completed shortly, and that, thereafter, these rules will be implemented 
over a three-year period. The types of controls being considered by the 
EPA include fugitive dust emission controls, restrictions for landfills 
located in sensitive areas, groundwater monitoring, standards for liners 
and caps, metals limits and corrective action for currently active units.

In 1995, the State of Indiana made a determination that the CKD stored at 
the Company's Greencastle plant is a Type I waste and requested that the 
Company apply for a formal permit for an on-site landfill for the CKD. The 
Company understands that similar notices were sent to other cement 
manufacturers in the State of Indiana. The Company is protesting this 
determination through legal channels and has received a stay to allow it 
to demonstrate that current management practices pose no threat to the 
environment. The Company believes that the State's determination 
ultimately will be reversed or the Company will receive the needed permit 
or other adequate relief, such as an agreed order requiring certain 
additional waste management procedures that are less stringent than those 
generally required for Type I wastes. If the Company is not successful in 
this regard, however, like other Indiana cement producers, the Greencastle 
plant could incur substantially increased operating and capital costs.

The Cape Girardeau, Missouri and Greencastle, Indiana plants, which are 
the Company's two cement manufacturing facilities using HWF as a cost-
saving energy source, are subject to strict federal, state and local 
requirements governing hazardous waste treatment, storage and disposal 
facilities, including those contained in the federal Boiler and Industrial 
Furnace Regulations promulgated under RCRA (the "BIF Rules"). These 
facilities qualified for and operate under interim status pursuant to RCRA 
and the BIF Rules. While Lone Star believes that it is currently in 
compliance with the extensive and complex technical requirements of the 
BIF Rules, there can be no assurances that the Company will be able to 
maintain compliance with the BIF Rules or that changes to such rules or 
their interpretation by the relevant agencies or courts might not make it 
more difficult or cost-prohibitive to continue to burn HWF.

The Company is currently engaged in the process of securing the permit 
required under RCRA and the BIF Rules for the Cape Girardeau plant. The 
Company anticipates that the Greencastle plant also will go through this 
permitting process and will complete a three-year recertification of its 
existing interim status in 1998. These permits are a requirement to enable 
Lone Star to continue the use of HWF at those facilities. The permitting 
process is lengthy and complex, involving the submission of extensive 
technical data. There can be no assurances that the Company will be 
successful in securing a final RCRA permit for either or both of its HWF 
facilities. In addition, if received, the permits could contain terms and 
conditions with which the Company cannot comply or could require the 
Company to install and operate costly control technology equipment.

The federal Comprehensive Environmental Response, Compensation and 
Liability Act ("CERCLA" or "Superfund"), as well as many comparable state 
statutes, creates a joint and several liability scheme for the 
investigation and remediation of facilities where releases of hazardous 
substances are found to have occurred. Liability may be imposed upon 
current owners and operators of the facility, upon owners and operators of 
the facility at the time of the release and upon generators and 
transporters of hazardous substances released at the facility. While, as 
noted above, wastes produced by the Company generally are not classified 
as hazardous wastes, many of the raw materials, by-products and wastes 
currently and previously produced, used or disposed of by the Company or 
its predecessors contain chemical elements or components that have been 
designated as hazardous substances or which otherwise may cause 
environmental contamination. Hazardous substances are or have been used or 
produced by the Company in connection with its cement manufacturing 
operations (e.g. grinding compounds, refractory bricks), quarrying 
operations (e.g. blasting materials), equipment operation and maintenance 
(e.g. lubricants, solvents, grinding aids, cleaning aids, used oils), and 
hazardous waste fuel burning operations. Past operations of the Company 
have resulted in releases of hazardous substances at sites currently or 
formerly owned by the Company and certain of its subsidiaries or where 
waste materials generated by the Company have been disposed. CKD and other 
materials were placed in depleted quarries and other locations for many 
years. The Company has been named by the EPA as a potentially responsible 
party for the investigation and remediation of several Superfund sites. 
Available factual information indicates that the Company's disposal of 
waste at these Superfund sites (other than sites that have been remediated 
or as to which the Company has entered into settlement agreements with the 
EPA) was small or non-existent, and the Company may have certain defenses 
arising out of its reorganization. The Company is also reviewing certain 
of its inactive properties to determine if any remedial action may be 
required at these sites.

The Company's operations are also subject to federal and state laws and 
regulations designed to protect worker health and safety. Worker 
protection at the Company's cement manufacturing facilities is governed by 
the federal Mine Safety and Health Act ("MSHA") and at other Company 
operations is governed by the federal Occupational Safety and Health Act 
("OSHA").


Note 8 -  Litigation

From time to time the Company is named as a defendant in lawsuits 
asserting product liability for which the Company maintains insurance 
coverage. In this regard, the Company is one of many defendants, including 
several cement manufacturers, named in two product liability lawsuits in 
southern Texas that allege that cement is an unreasonably dangerous 
product that has injured a large number of plaintiffs. The Company 
believes this type of litigation is totally without merit and is 
contesting the lawsuits vigorously. The Company also has been named in a 
lawsuit asserting that it has successor liability for certain defunct 
subsidiaries which allegedly manufactured faulty prestressed "double tees" 
resulting in property damage to a retail store (and consequent loss of 
business) in south Florida during Hurricane Andrew in 1992. In late 1995, 
an office building in Boston, Massachusetts, constructed in 1983 using 
concrete pilings produced by San-Vel Concrete Corporation, an inactive 
Lone Star subsidiary ("San-Vel"), was demolished by order of the City of 
Boston based upon an engineering report that the pilings were unreliable. 
The owner of this demolished building brought suit against San-Vel and 
the Company, alleging, among other things, that San-Vel was negligent in 
producing, and that it breached representations relating to, the pilings. 
At the request of the City of Boston, San-Vel has provided a list of the 
approximate twenty-five other buildings built in that City between 1980 
and 1990 using San-Vel pilings. The City has reportedly inspected these 
buildings visually, without noting any apparent piling failure. Certain 
engineering studies also have been conducted, and those limited results 
that have been made available to the Company do not indicate any 
additional failures.  The Company believes that San-Vel used cement 
produced by Lone Star at one of its formerly owned cement plants to mix 
the concrete from which pilings in certain of these buildings (including 
the demolished building) were produced. There has been no indication that 
Lone Star's production of this cement was defective.  The Company is 
contesting this lawsuit vigorously, and believes that it has good defenses 
to the lawsuit. The foregoing matters are being defended by the Company's 
insurers. No assurances as to their ultimate outcome can be given.


 

 
 
ITEM 2 . MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL       
         CONDITION AND RESULTS OF OPERATIONS


Financial Condition

	The Company believes that cash and marketable securities on hand 
of $145.4 million and funds generated by operations will be adequate 
to cover current working capital and capital expenditure needs. 
	
	The Company's financing agreement and the revolving credit 
facility contain certain restrictive covenants which, among other 
things, could have the effect of limiting the payment of dividends and 
the repurchase of common stock and warrants.  Approximately $104.7 
million is currently available for such payments under the most 
restrictive of such covenants.  

	Cash flows from operating activities of $5.2 million for the 
three months ended March 31, 1998 primarily reflect income from 
operations and changes in working capital.  The utilization of net 
operating loss carryforwards and other deferred tax assets during the 
first quarter reduced cash taxes otherwise payable by $1.5 million.
 
	During the three months ended March 31, 1998, investing 
activities used $13.4 million, primarily representing $15.9 million 
for capital expenditures, partly offset by $1.5 million received for 
the sale of a parcel of real estate and $1.0 million related to sales 
of miscellaneous property, plant and equipment.   

	Net cash outflows from financing activities of $0.5 million for 
the three months ended March 31, 1998 primarily reflect dividends paid 
during the first quarter. 

	Working capital on March 31, 1998 was $165.8 million as compared 
to $169.6 million on December 31, 1997.  Current assets increased $2.0 
million primarily due to higher inventory balances offset by lower 
short-term investments and accounts and notes receivable balances. 
Current liabilities increased $5.8 million primarily due to an 
increase in accounts payable, partly offset by a decrease in accrued 
expenses.  

	The $1.5 million decrease in the Company's long-term deferred 
tax asset is due to the utilization of a portion of the tax assets 
during the first quarter of 1998.  Investments in joint ventures 
increased $0.6 million as the Company's share of equity earnings 
exceeded cash distributions paid from Kosmos Cement Company.  Net 
property, plant and equipment increased $9.5 million reflecting 
capital expenditures, partly offset by depreciation expense. 

	In February 1998, the Company's Board of Directors declared a 
$0.05 per share dividend which was paid on March 16, 1998 to 
shareholders of record as of March 1, 1998.  

	The Company is subject to extensive, stringent and complex 
federal, state and local laws, regulations and ordinances 
pertaining to the quality and the protection of the environment and 
human health and safety, requiring the Company to devote 
substantial time and resources in an effort to maintain continued 
compliance. Many of the laws and regulations apply to the Company's 
former activities, properties and facilities as well as its current 
operations. There can be no assurances that judicial or 
administrative proceedings, seeking penalties or injuctive relief, 
will not be brought against the Company for alleged non-compliance 
with applicable environmental laws and regulations relating to 
matters as to which the Company is currently unaware.  For 
instance, if releases of hazardous substances are discovered to 
have occurred at facilities currently or previously owned or 
operated by the Company, or at facilities to which the Company has 
sent waste materials, the Company may be subject to liability for 
the investigation and remediation of such sites.  In addition, 
changes to such regulations or the enactment of new regulations in 
the future could require the Company to undertake capital 
improvement projects or to cease or curtail certain operations or 
could otherwise substantially increase the capital, operating and 
other costs associated with compliance(See Note 7).

	The Company believes that it has adequately provided for costs 
related to its ongoing obligations with respect to known environmental 
liabilities. Expenditures for environmental liabilities during the 
first quarter of 1998 did not have a material effect on the financial 
condition or cash flows of the Company.
	
	
Forward-Looking Statements

	This Management's Discussion and Analysis of Financial Condition 
and Results of Operations and other sections of this Form 10-Q contain 
forward-looking statements within the meaning of Section 27A of the 
Securities Exchange Act of 1933 and Section 21E of the Securities 
Exchange Act of 1934.  These forward-looking statements are based on 
current expectations, estimates and projections concerning the general 
state of the economy and the industry and market conditions in certain 
geographic locations in which the Company operates.  Words such as 
"expects", "anticipates", "intends", "plans", "believes", "estimates" 
and variations of such words and similar expressions are intended to 
identify such forward-looking statements.  These statements are not 
guarantees of future performance and involve certain risks, 
uncertainties and assumptions which are difficult to predict. 
Therefore, actual results and outcomes may differ materially from what 
is expressed or forecasted in such forward-looking statements. The 
Company undertakes no obligation to update publicly any forward-
looking statements as a result of new information, future events or 
other factors.

	The Company's business is cyclical and seasonal, the effects of 
which cannot be accurately predicted. Risks and uncertainties include 
changes in general economic conditions (such as changes in interest 
rates), changes in economic conditions specific to any one or more of 
the Company's markets (such as the strength of local real estate 
markets and the availability of public funds for construction), 
adverse weather, unexpected operational difficulties, changes in 
governmental and public policy including increased environmental 
regulation, the outcome of pending and future litigation, the 
successful negotiation of labor contracts and the continued 
availability of financing in the amounts, at the times, and on the 
terms required to support the Company's future business.  Other risks 
and uncertainties could also affect the outcome of the forward-looking 
statements.  


Results of Operations

	Consolidated net sales of $57.8 million during the first quarter 
of 1998 were $3.0 million lower than the comparable prior-year 
results.  The decrease in net sales primarily reflects the sales of 
the Company's New York construction aggregates and central Illinois 
ready-mixed concrete operations during 1997.  

	Sales of $57.8 million from the Company's on-going cement and 
ready-mixed concrete operations for the three months ended March 31, 
1998 were $4.5 million higher than the comparable prior-year period. 
Cement sales were higher due to a 4% increase in average net realized 
cement selling prices in 1998 combined with a 6% increase in cement 
shipments.  The increase in shipments is attributable to continued 
strong demand for cement in the Company's major markets as well as an 
unusually mild winter season.     

	Gross profit from the Company's on-going cement and ready-mixed 
concrete operations of $13.6 million for the first quarter of 1998 was 
$2.0 million higher than the comparable 1997 period.  The increase in 
gross profit reflects higher average net realized cement and ready-mix 
selling prices, greater cement production and higher overall shipments 
for the quarter.
    
	The construction aggregates and ready-mixed concrete operations 
sold in 1997 contributed sales of $7.6 million and a loss at the gross 
profit level of $3.1 million to the first quarter 1997 results.  As a 
result of the losses sustained by these operations during the first 
quarter of 1997, the dispositions of the operations had a favorable 
impact on the results for the first quarter of 1998 as compared to 
last year.  The impact for the remainder of the year will not be 
favorable as the results from these operations for the second, third 
and fourth quarters of 1997 included gross profit of $2.5 million, 
$3.7 million and $0.6 million, respectively.  For the full year 1997 
these operations contributed net sales of $40.3 million and gross 
profit of $3.7 million.

	The Company's operations are seasonal and, consequently, the 
interim results are not indicative of the results to be expected for 
the full year.

	Included in the calculation of gross profit are sales less cost 
of sales including depreciation related to cost of sales (which 
excludes depreciation related to office equipment, furniture and 
fixtures which are not related to the cost of sales).

	Pre-tax income from joint ventures of $0.8 million during the 
first quarter of 1998 reflects the results of the Kosmos Cement 
Company, a partnership in which the Company has a 25% interest.  The 
results for the three months ended March 31, 1998 were $0.1 million 
higher than the comparable prior-year period reflecting higher net 
realized selling prices partly offset by lower shipments. 

	Other income of $3.8 million during the first quarter of 1998 
increased $3.1 million over the comparable 1997 period, primarily 
reflecting a gain of $1.5 million on the sale of a surplus parcel of 
real estate and higher interest income earned on increased short-term 
investment balances.

	Selling, general and administrative expenses of $6.7 million 
during the first quarter of 1998 was $1.0 million lower than the 
comparable period in 1997, reflecting lower expense related to the 
Company's New York construction aggregates and central Illinois ready-
mixed concrete operations which were sold in 1997, in addition to 
lower pension and other postretirement benefit expenses.  

	Interest expense of $0.7 million during the first quarter of 
1998 represents a decrease of $1.0 million over the comparable prior-
year period expense. Capitalized interest was $0.2 million for the 
three months ended March 31, 1998 and 1997.  The reduction in interest 
expense reflects lower debt and a lower interest rate.  The Company 
redeemed $78.0 million of its 10% senior notes in March and April 1997 
and issued $50.0 million of 7.31% senior notes offered through a 
private placement agreement in April 1997.  

	The income tax expense of $3.6 million during the first quarter 
of 1998, an increase of $3.5 million from the prior-year expense, 
primarily reflects higher pre-tax earnings in the first quarter of 
1998.  

	Net income of $7.1 million during the first quarter of 1998 was 
$6.8 million higher than the prior-year results. On a per share basis, 
basic and diluted earnings for the first quarter of 1998 were $0.66 
and $0.52, respectively, compared to $0.02 and $0.02, respectively, 
for 1997.  This improvement is primarily due to the disposition of the 
Company's New York construction aggregates and central Illinois ready-
mixed concrete operations and higher results for the cement operations 
reflecting higher average selling prices and increased shipments. Also 
contributing to the favorable increase in net income for 1998 over the 
prior-year results were a gain on the sale of surplus real estate, 
higher interest income reflecting higher short-term investment 
balances, higher joint venture income and lower interest expense. 
These favorable results were partly offset by increased income tax 
expense due to higher pre-tax earnings.

	

 

 
 



PART II.  OTHER INFORMATION



ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

	(a)	Index of Exhibits:

		27.	Financial Data Schedule.



                            SIGNATURES



	Pursuant to the requirements of the Securities Exchange Act of 
1934, Lone Star Industries, Inc. has duly caused this report to be 
signed on its behalf by the undersigned thereunto duly authorized.

							LONE STAR INDUSTRIES, INC.



Date: May 1, 1998				By:  WILLIAM E. ROBERTS	
							     William E. Roberts
							    Vice President, Chief
							      Financial Officer,
							   Controller and Treasurer



Date: May 1, 1998				By:    JAMES W. LANGHAM	 
							       James W. Langham
							    Vice President, General
								Counsel and Secretary