FORM 10-QSB

                    SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C.  20549

                Quarterly Report Under Section 13 or 15(d)
                  of the Securities Exchange Act of 1934

For Quarter Ended:       March 31, 1998
Commission File Number:  0-4728


        ARROW-MAGNOLIA INTERNATIONAL, INC.                       
 (Exact name of small business issuer as specified in its
charter)

                                   Texas 
(State or other jurisdiction of incorporation or organization)

                                75-0408335
                   (I.R.S. Employer Identification No.)

                   2646 Rodney Lane, Dallas, Texas 75229         
                 (Address of principal executive offices)

                              (972) 247-7111
             (Issuer's telephone number, including area code)

Check whether the issuer (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of
1934during the past 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.

                                X                        
                                Yes                   No

         Number of common shares outstanding as of March 31,
1998:

              Common Stock, $0.10 par value, 2,685,748 shares
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                    ARROW-MAGNOLIA INTERNATIONAL, INC.
                              March 31, 1998

                             TABLE OF CONTENTS
 
                      PART I. FINANCIAL INFORMATION.


Item 1.   Financial Statements                              Page

     Arrow-Magnolia International, Inc. and Subsidiary      2
     Condensed Consolidated Balance Sheets as of 
     March 31, 1998 (unaudited) and December 31, 1997.

     Arrow-Magnolia International, Inc. and Subsidiary      3
     Condensed Consolidated Statements of Income for 
     the Three Months Ended March 31, 1998 and
     1997 (unaudited).
     
     Arrow-Magnolia International, Inc. and Subsidiary      4
     Condensed Consolidated Statements of Cash Flows 
     for the Three Months Ended March 31, 1998 and 
     1997 (unaudited).

     Notes to Condensed Consolidated Financial              5
     Statements (unaudited).

Item 2.   Management's Discussion and Analysis or           6
          Plan of Operation.



                       PART II.  OTHER INFORMATION.


Item 6.   Exhibits and Reports on Form 8-K                      
7

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             ARROW-MAGNOLIA INTERNATIONAL, INC. AND SUBSIDIARY
             Condensed Consolidated Balance Sheets (Unaudited)
                   March 31, 1998 and December 31, 1997

<TABLE>
                                        March 31,    December 31,
               Assets                   1998           1997
                                        (unaudited)
<S>                                     <C>            <C>
Current assets:
Cash                                    $2,093,122     1,878,919
Short-term investments, at cost            300,000       300,000
Trade accounts receivable, less 
 allowance for doubtful
 accounts of $162,759 in 1998 and 
 $346,900 in 1997                       3,176,530      2,773,352
  Inventories                             629,986        601,157
  Deferred income taxes                    55,338        117,946
  Other assets                              2,370         26,632
     Total current assets               6,257,346      5,698,006

Property and equipment, net               711,206        738,916
Intangible assets, net                    135,800        137,318
Note receivable                            40,000         40,000
Deferred income taxes                      29,912         29,912
Other assets                                2,700          2,700
                                       $7,176,964      6,646,852
     
     Liabilities and Stockholders' Equity

Current liabilities:
  Current installments of 
     long-term debt                     $  66,241        101,361
  Accounts payable                        747,246        571,426
  Accrued liabilities                      86,168        216,324
  Income taxes payable                    224,826        140,281
     Total current liabilities          1,124,481      1,029,392

Note payable                              600,000        600,000
Deferred compensation                     104,500        104,500
Long-term debt, excluding current 
     installments                               -              -
     Total liabilities                  1,828,981      1,733,892

Stockholders' equity:
  Preferred stock - par value $.10; 
     authorized 500,000 shares; 
     none issued                                -              -
  Common stock - par value $.10; 
     authorized 10,000,000 shares; 
     2,685,748 shares issued and 
     outstanding in 1998 and 
     2,681,392 shares issued and 
     outstanding in 1997                  268,575        268,139
Additional paid-in capital              2,794,253      2,776,182
Accumulated earnings                    2,285,155      1,868,639
     Total stockholders' equity         5,347,983      4,912,960

Commitments                                                      

                                        $7,176,964     6,646,852
</TABLE>
See accompanying notes to condensed consolidated financial
statements.

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             ARROW-MAGNOLIA INTERNATIONAL, INC. AND SUBSIDIARY

          Condensed Consolidated Statements of Income (Unaudited)

                Three months ended March 31, 1998 and 1997

<TABLE>
                              1998           1997
                              (unaudited)    (unaudited)
<S>                           <C>            <C>
Net sales                     3,630,199      2,771,703 
Cost of sales                 1,977,760      1,521,789 
     Gross profit             1,652,439      1,249,914 

Selling, general and 
administrative expenses       1,004,890        930,107
     Operating income           647,549        319,807 

Other income (expenses):
   Interest expense             (14,523)       (16,820)
   Other income                  17,351         17,227 
     Other income (expenses), 
     net                          2,828            407 
     Income before income taxes 650,377        320,214

Income taxes:
   Current                      171,253         169,090 
   Deferred income tax expense 
     (benefit)                   62,608          (8,088)
     Net income                 416,516         159,212 

Earnings per common share:
   Basic                            .16            .06 

   Diluted                          .14            .05 

</TABLE>
See accompanying notes to condensed consolidated financial
statements.
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             ARROW-MAGNOLIA INTERNATIONAL, INC, AND SUBSIDIARY

      Condensed Consolidated Statements of Cash Flows (Unaudited)

                Three Months ended March 31, 1998 and 1997

                                   1998           1997
                                   (unaudited)    (unaudited)
<TABLE>
<S>                                <C>            <C>
Cash flows from operating 
activities:
  Net income                       $416,516       159,212 
  Adjustments to reconcile net 
     earnings to net cash
     used in operating activities:
     Depreciation and amortization   35,518        36,637 
     Deferred income taxes           62,608        (8,088)
     Provision for doubtful accounts 82,931        63,313 
     Compensation expense from 
     issuance of stock options
     and warrants                     7,720       104,500 
     (Increase) decrease in 
     operating assets:
        Receivables                (486,109)     (480,685)
        Inventories                 (28,829)      (89,762)
        Other assets                 24,262       (57,519)
     Increase (decrease) in 
     operating liabilities:
        Accounts payable            175,820       192,348 
        Accrued liabilities        (130,156)      (85,388)
        Income taxes payable         93,154       (20,466)
          Net cash provided by 
          (used in) operating 
          activities                253,435      (185,898)

Cash flows from investing activities:
   Purchase of short-term 
     investments                        -         (16,051)
   Acquisition of property and 
     equipment                        (6,290)     (56,793)
          Net cash used in investing 
          activities                  (6,290)     (72,844)

Cash flows from financing activities:
   Repayments of note payable        (35,120)     (30,000)
   Repayments of long-term debt            -     (101,713)
   Proceeds from common stock 
     issuance                          2,178      (37,121)
          Net cash used in 
          financing activities       (32,942)     (67,121)

Net increase (decrease) in cash      214,203      (325,863)
Cash at beginning of period        1,878,919      1,755,000 
Cash at end of period             $2,093,122      1,429,137 

</TABLE>
See accompanying notes to condensed consolidated financial
statements.
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ARROW-MAGNOLIA INTERNATIONAL, INC. AND SUBSIDIARY

Notes to Condensed Consolidated Financial Statements
(Unaudited)
        
              March 31, 1998 and 1997
  
(1) Basis of Presentation

The March 31, 1998 and 1997 condensed consolidated financial
statements (unaudited) include the accounts of Arrow-Magnolia
International, Inc., and its Chemco Chemical Company Division,
and its wholly-owned subsidiary, Bio/Dyne Chemical Company, an
inactive corporation.  All significant intercompany balances
and transactions have been eliminated.

The quarterly financial information included herein is
unaudited; however, such information reflects all adjustments
(consisting solely of normal recurring adjustments) which are,
in the opinion of management, necessary for a fair statement
of results for the interim period.  Certain items in the 1997
condensed consolidated financial statements have been adjusted
to reflect the actual timing of certain transactions as
described in the Company's December 31, 1997 annual report on
Form 10-KSB.
        
(2) Earnings Per Share

 The Company adopted the provisions of Statement of Financial
 Accounting Standards (SFAS) No. 128, Earnings Per Share,
 during 1997 and retroactively restated all per share amounts. 
 SFAS No. 128 reporting requirements replace primary and fully-
 diluted earnings per share (EPS) with basic and diluted EPS. 
 Basic EPS is calculated by dividing net income (available to 
common shareholders) by the weighted average number of common
 shares outstanding for the period.  Diluted EPS reflects the
 potential dilution that could occur if securities or other
 contracts to issue common stock were exercised or converted
 into common stock.

(3)  Newly Adopted Accounting Pronouncements

On January 1, 1998, the Company adopted Statement of Financial
Accounting Standards No. 130, "Reporting Comprehensive
Income."  This statement establishes standards for reporting
the components of comprehensive income and requires that all
items that are required to be recognized under accounting
standards as components of comprehensive income be included in
a financial statement that is displayed with the same
prominence as other financial statements.  Comprehensive
income includes net income as well as certain items that are
reported directly within a separate component of shareholders'
equity and bypass net income.  The adoption of Statement 130
did not have a material impact on the Company's financial
condition or results of operations.
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Item 2.   Management's Discussion and Analysis or Plan of
          Operation.

Material Changes in Financial Condition.

     The Company's working capital (total current assets less
total current liabilities), which was $4,668,614 as of December
31, 1997, increased to $5,132,865 as of March 31, 1998. The
increase in working capital was primarily the result of growth in
cash and trade accounts receivable as a result of improved sales
in the quarter, partially offset by increased accounts payable
incurred in connection with increased sales and income taxes
payable resulting from improved profitability.

     The Company's cash flow from operations for the quarter
provided $253,435 as funds generated from earnings and management
of accounts payable exceeded cash used to support additional
growth, primarily to fund increased accounts receivable, and to
reduce accrued liabilities. Funds were also utilized to acquire
property and equipment and to reduce debt.  The resulting
increase in cash for the quarter was $214,203.

     Currently, the Company is evaluating whether to construct an
additional 30,000 square feet of warehouse space to its existing
facilities and should have more than adequate funds on hand to
complete this addition if the Company concludes that it is
desirable.  The Company believes that its present financing is
also otherwise adequate for its capital needs for the foreseeable
future.
 
Material Changes in Results of Operations

     Net sales for the quarter ended March 31, 1998 increased
from $2,771,703 to $3,630,198, or 31.0%, from the same period of
the previous year. This increase is primarily attributable to the
extension of sales coverage through the addition of sales
personnel under an ongoing hiring program which included the
acquisition of Darsan, Inc. and Southwest Supply & Environmental
in May 1997. 

     Cost of sales as a percentage of net sales remained steady
at 54.5% of net sales for the quarter ended March 31, 1998 as
compared to 54.9% of net sales for the same period of 1997. As a
result, gross profit increased by 32.2% from $1,249,914 to
$1,652,439 for the quarter ended March 31, 1998 versus the
comparable quarter of fiscal 1997.  The first quarter of 1997
also included a nonrecurring charge of $100,000 as the result of
issuing options to a key employee.

     Selling, general and administrative expenses increased by
8.0% for the comparable quarters.  This increase reflects costs
associated with adding the sales force of Darsan/Southwest and
extending the Company's existing sales force coverage.    
  
     As a result of these factors, net earnings before income
taxes increased to $650,377 from $320,214 for the corresponding
quarters of 1998 and 1997.  Similarly, net earnings increased
dramatically for the comparable quarters, from $159,212 to
$416,516 or 161.6%.
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                        Part II.  OTHER INFORMATION


Item 6.   Exhibits and Reports.

     (a)  None

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                                 SIGNATURE

Pursuant to the requirement of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.


                                   ARROW-MAGNOLIA INTERNATIONAL,
                                   INC.



Date:  May 8, 1998                 By:  /s/ Morris Shwiff        
                                        Morris Shwiff, President
                                        and Principal Executive
                                        Officer




Date:   May 8, 1998                By:  /s/ Fred Kenner          
                                       Fred Kenner, Vice
                                      President,
                                       Secretary and Treasurer;
                                      the Principal
                                       Financial and
                                       Accounting Officer