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                      SECURITIES AND EXCHANGE COMMISSION
                           Washington, D.C.  20549

                                FORM 10-QSB

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

For the quarterly period ended September 30, 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:    001-01428 

                        METALINE MINING & LEASING COMPANY
             (Exact name of registrant as specified in its charter)

       State of Washington                                 91-0684860
______________________________________                 ___________________
(State or other jurisdiction of                         (I.R.S. Employer
incorporation or organization)                          Identification No.)

601 West Main Avenue, Suite 714
Spokane, Washington                                           99201-0677
__________________________________________                  _______________
(Address of principal executive offices)                      (Zip Code)

(Registrant's telephone number, including area code)   509-455-9077

Check whether the issuer (1) filed all reports required to be filed by 
Section 13 or 15(d) of the Exchange Act during 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 at least the past 
90 days.  Yes  (X)    No  ( )

State the number of shares outstanding of each of the issuer's classes of 
common equity, as of the latest practicable date.  14,555,668

Transitional Small Business Disclosure Format (check one): Yes ( )  No (X) 










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SUBMISSION PAGE: 1 OF 12
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PART 1 FINANCIAL INFORMATION

     a)  Financial Statement of Registrant

     INDEX

          Balance Sheet (Unaudited) as of September 30, 1998 and 
               December 31, 1997

          Statement of Income and Retained Earnings (Unaudited) for the 
               three and nine months ended September 30, 1998 and 1997

          Statement of Cash Flows (Unaudited) for the nine months ended 
               September 30, 1998 and 1997

          Notes to the Financial Statements (Unaudited)

The financial statements of the Registrant included herein have been 
prepared, without audit, pursuant to the rules and regulations of the 
Securities Exchange Commission.  Although certain information normally 
included in financial statements prepared in accordance with generally 
accepted accounting principles has been condensed or omitted, the 
Registrant believes that the disclosures are adequate to make information 
presented not misleading.  It is suggested that these financial statements 
be read in conjunction with the financial statements and the notes thereto 
included in the Annual Report on Form 10-K of the Registrant for its year 
ended December 31, 1997.

The financial statements included herein reflect all adjustments (consisting 
only of normal recurring accruals) which, in the opinion of management, are 
necessary to present a fair statement of the results for the interim periods.

The results for interim periods are not necessarily indicative of trends or 
of results to be expected for a full year.

/s/ Robert Moe & Associates






















SUBMISSION PAGE:  2  OF 12
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METALINE MINING & LEASING COMPANY
(A Development Stage Company) 

BALANCE SHEET (Unaudited)
SEPTEMBER 30, 1998 AND DECEMBER 31,1997

<TABLE>

ASSETS
                                                   SEPT. 30, 1998    DEC. 31, 1997
                                                   ______________    _____________
<C>                                                <S>               <S>
CURRENT ASSETS
     Cash in bank                                  $       6,085     $      8,490
     Composite cash fund                                   1,674            1,613
     Money market fund                                   396,345              -  
     Certificate of deposit                              101,223              -
     Note Receivable                                       5,000            5,000
                                                   ______________    _____________

        Total current assets                             510,327           15,103
                                                   ______________    _____________

SECURITIES                                                13,719              - 

MINING PROPERTIES                                          4,043            4,043
                                                   ______________    _____________

        Total assets                               $     528,089     $     19,146
                                                   ==============    =============

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES  
     Accounts payable                              $         267     $     21,932
     Deposit                                                 -              9,784
                                                   ______________    _____________

        Total Current Liabilities                            267           31,716
                                                   ______________    _____________

STOCKHOLDERS' EQUITY  
     Common stock - No par value 15,000,000  
       shares authorized 7,277,834 - 1998; 
       7,277,834 - 1997; issued and outstanding          145,072          145,072
     Paid in capital                                     287,411          287,411
     Unrealized loss, marketable securities               (5,773)          (5,773)
     Retained earnings (deficit) accumulated            
       during the development stage                      101,112         (439,280)
                                                   ______________    _____________

        Total Stockholders' Equity                       527,822           (12,570)
                                                   ______________    _____________

        Total Liabilities and Stockholders' Equity $     528,089     $     19,146
                                                   ==============    =============
</TABLE>

The accompanying notes are an integral part of these financial statements

SUBMISSION PAGE:  3  OF 12
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METALINE MINING & LEASING COMPANY 
(A Development Stage Company) 

STATEMENT OF INCOME AND RETAINED EARNINGS (Unaudited) 

<TABLE>
                                 THREE MONTHS ENDED              NINE MONTHS ENDED
                                    SEPTEMBER 30,                  SEPTEMBER 30,
                               1998             1997          1998           1997
                              ____________  ____________  ____________  ____________
<C>                           <S>           <S>           <S>           <S>
INCOME 
  Dividend & interest income  $     6,108   $        31   $     7,629   $        93
                              ____________  ____________  ____________  ____________
         Total Income               6,108            31         7,629            93

EXPENSES 
  Directors' fees                     -             720           300         6,320
  Professional fees                   300           -          19,404           -
  Office expense                       34            16           350            83
  Taxes, licenses, and fees           -              24           561           272
                              ____________  ____________  ____________  ____________
       Total expenses                 334           760        20,615         6,675
                              ____________  ____________  ____________  ____________

INCOME (LOSS) BEFORE OTHER
 INCOME AND (EXPENSES)              5,774          (729)       (12,986)      (6,582)

OTHER INCOME AND (EXPENSES) 
  Sale of securities                  -             -          711,377          -
                              ____________  ____________  ____________  ____________
       Total Other Income             -             -          711,377          -
                              ____________  ____________  ____________  ____________
INCOME (LOSS) BEFORE 
  PROVISION FOR FEDERAL 
  INCOME TAXES                      5,774          (729)       698,391      (6,582)

PROVISION FOR FEDERAL INCOME 
  TAXES                             2,000           -          158,000         -
                              ____________  ____________  ____________  ____________

NET INCOME (LOSS)                   3,774          (729)       540,391      (6,582)

RETAINED EARNINGS (DEFICIT)  

  Beginning of period              97,338        (1,519)      (439,279)      4,334
                              ____________  ____________  ____________  ____________

  End of period               $   101,112   $    (2,248)  $    101,112  $   (2,248)
                              ============  ============  ============  ============

INCOME (LOSS) PER SHARE               NIL           NIL            NIL         NIL
                              ============  ============  ============  ============
</TABLE>


The accompanying notes are an integral part of these financial statements

SUBMISSION PAGE: 4 OF 
12
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METALINE MINING & LEASING COMPANY 
(A Development Stage Company) 

STATEMENT OF CASH FLOWS (Unaudited) 

<TABLE>
                                                          NINE MONTHS ENDED
                                                            SEPTEMBER 30, 
                                                        1998              1997
                                                   ______________    _____________

<C>                                                <S>               <S>
CASH FLOWS PROVIDED (USED) IN OPERATING
  ACTIVITIES:
    Net income (loss)                              $    540,391       $    (6,582)
    Non cash items included in income: 
      Stock issued for services                             -               6,320
    Increase (Decrease) in current assets
      and liabilities:
      Accounts payable from operation                   (31,448)           (1,500)
                                                   ______________    _____________
    Net cash (used) by operating activities             508,943            (1,762)
                                                   ______________    _____________

CASH FLOWS PROVIDED (USED) IN INVESTING 
  ACTIVITIES:
    Received from sale of Kreugerrands                      -               2,220
    Purchase of Krugerrands and Silver                  (13,719)              -
                                                   ______________    _____________
    Net cash (used) by investing activites              (13,719)            2,220
                                                   ______________    _____________

NET INCREASE (DECREASE) IN CASH                         495,224               458

CASH AT BEGINNING OF PERIOD                              10,103             1,792
                                                   ______________    _____________

CASH AT END OF PERIOD                              $    505,327      $      2,250
                                                   ==============    =============

SUPPLEMENTAL DISCLOSURES OF CASH FLOW
  INFORMATION
    Cash and cash equivalents 
      Cash in bank                                 $     6,085       $        657
      Composite cash fund                                1,674              1,593
      Money market fund                                396,345                -
      Certificate of deposit                           101,223                -
                                                   ______________    _____________
                                                    $  505,327       $      2,250
                                                   ==============    =============
</TABLE>
The Company has adopted Statement of Financial Accounting Standards 
No. 95, Statement of Cash Flows.  For purposes of this statement, 
short-term investments which have initial maturity of ninety days or 
less are considered cash equivalents.

The accompanying notes are an integral part of these financial statements

SUBMISSION PAGE: 5 OF 12
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METALINE MINING & LEASING COMPANY
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

1 -  ORGANIZATION

The Company is currently in the development stage and is currently 
negotiating with major mining companies for development of all of their 
properties.

The Company was organized on December 14, 1927.  The Articles of 
Incorporation stated the term of the corporation's existence shall be fifty 
years.  The expiration date of the corporation's existence was 
December 13, 1977.

On May 12, 1977, Spokane Superior Court appointed a trustee to represent 
the missing shareholders at a special meeting of shareholders held on May 17, 
1977.  At the special meeting the shareholders and the trustee unanimously 
approved a resolution to enable the corporation to amend its Articles of 
Incorporation to extend the corporate life perpetually.

2 - ACCOUNTING POLICIES

    A.  The Company's records are maintained on the accrual method of 
        accounting.

    B.  The Company capitalizes all acquisition and exploration costs on all 
        non-operating mining properties and mineral rights for accounting and 
        income tax purposes.  Upon commencement of operations, the 
        capitalized costs will be amortized based on proven or probable 
        reserves by the unit of production method so that each unit produced 
        is assigned a pro rata portion of the unamortized acquisition costs.

    C.  Capitalized costs are charged to operations when title to the 
        property has expired or when management feels the properties are not 
        economically feasible to develop or hold for future development.

    D.  Accounting Estimates:  The preparation of financial statements in 
        conformity with generally accepted accounting principles requires 
        management to make estimates and assumptions that affect the reported 
        amounts of assets and liabilities and disclosures of contingent 
        assets and liabilities at the date of the financial statements and 
        the reported amounts of revenues and expenses during the reporting 
        period.  Actual results could differ from those estimates.

    E.  Other Comprehensive Income.  For the period ended September 30, 1998, 
        the Company did not have other revenues, expenses, gains and losses 
        that require disclosure under SFAS No. 130 as other comprehensive 
        income.

    F.  Concentration of Credit Risk.  Financial instruments that potentially 
        subject the Company to significatn concentrations of credit risk 
        consist principally of cash investment.  As of September 30, 1998, 
        the Company  had cash with Wells Fargo Bank with a combined balance 
        of $488,309, which is $388,309 in excess of the FDIC insured amount.




SUBMISSION PAGE: 6 OF 12
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METALINE MINING & LEASING COMPANY
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

3 - MARKETABLE SECURITIES 

At December 31, 1997, the Company owned 1,477,239 shares of Metaline Contact 
Mines whose asset carrying value has been written off.  Metaline Contact 
Mines is owned 51% by the Bunker Hill Company, a subsidiary of Gulf Resources 
Chemical Corporation.  These shares were sold during 1998 and the Company 
received a total of $711,377.

The Company owned 25,000 shares of Capitol Silver Mines, Inc.  Capitol Silver 
Mines, Inc. is in the development stage and as of this date is unproductive.

The Company owned 31,151 shares of Carson Industries Corporation.  Carson
Industries Corporation is currently involved in oil and gas.

The Corporation has adopted Statement of Financial Accounting Standards 
(SFAS) No. 115, Accounting for Certain Investments in Debt and Equity 
Securities.  SFAS No. 115 establishes generally accepted accounting 
principles for the financial accounting and measurement and disclosure 
principles for (1) investments in equity securities that have 
readily determinable fair market value and (2) all investments in debt 
securities.  The change had no effect on prior years' results.  All of the 
marketable securities held by METALINE MINING & LEASING COMPANY consists of 
securities "available-for-sale" as defined by SFAS No. 115.  The basis on 
which cost is determined in computing realized gain or loss is the specific 
identification method.

The following information is as of September 30, 1998 and December 31, 1997:
<TABLE>
                                                       1998          1997
                                                   ____________  ____________
<C>                                                <S>           <S>
Aggregate fair value of marketable securities      $       -   $         -
Gross unrealized holding losses                          5,773         5,773
Amortized cost basis                                     5,773         5,773
</TABLE>

Changes in marketable securities for the nine months ended September 30, 
1998 and the twelve months ended December 31, 1997 and 1996 are as follows:
<TABLE>
                                                       1998         1997
                                                   ____________  ____________
<C>                                                <S>           <S>
Cost as of January 1,                              $     5,773   $     5,773
Purchase of Krugerrands                                 13,719           -  

Unrealized loss                                         (5,773)       (5,773)
                                                   ____________  ____________

Fair market value                                  $    13,719   $       -
                                                   ============  ============
</TABLE>



SUBMISSION PAGE: 7 OF 12
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METALINE MINING & LEASING COMPANY
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

4 - MINING CLAIMS

In July of 1985 the Company purchased two units of Pondera Partners, LTD., a 
drilling project located in Teton County, Montana.  Total cost for the 5.714% 
interest was $12,000.  The Partnership has elected to treat intangible 
drilling costs as a current expense deductible in the year in which paid or 
incurred.

PARTNERSHIP INTERESTS 
December 31, 1997 and September 30, 1998
<TABLE>

                                           Ordinary  
                               Beginning   Income      Distri-     Ending
                               Capital     (Loss)      butions     Capital
                               __________  __________  __________  __________
<C>                            <S>         <S>         <S>         <S>
Pondera Partner Ltd., 1997     $   4,116   $     (73)  $    -      $   4,043
                               __________  __________  __________  __________
Balance at December 31, 1997   $   4,116   $     (73)  $    -      $   4,043 
                               ==========  ==========  ==========  ==========

Pondera Partner Ltd., 1998     $   4,043   $     -     $    -      $   4,043
                               __________  __________  __________  __________
                               $   4,043   $     -     $    -      $   4,043
                               ==========  ==========  ==========  ==========
</TABLE>

5 - COMMON STOCK
At December 31, 1997, the Company's independent transfer agent reported that 
7,277,834 shares of common stock were outstanding.

The Articles of Incorporation were amended December 31, 1983 to reclassify 
shares and reduce capital to $299,000.  The capitalization of the Company 
shall be divided into 15,000,000 shares of no par value common non-assessable 
stock.  None  of these shares shall have preemptive rights.  Each and every 
share of stock shall have the same rights and privileges as those enjoyed by 
each and every other share.

The Board of Directors of Metaline Mining & Leasing Company passed 
unanimously to compensate the directors for services rendered in the form of 
Metaline Mining & Leasing Company Stock.  The Board of Directors were each 
issued shares of Metaline Mining & Leasing Company Stock for services 
performed.  During 1997 1,464,000 shares were issued to Directors for 
services.  The shares authorized by the Board of Directors to compensate 
Directors for 1995 and 1996 were issued during 1997. The issue of stock for 
services is valued using the stock quotation price on the date of issue less 
50% due to the fact that it is restricted stock.

On December 30, 1997 options to acquire 500,000 shares of Metaline Mining & 
Leasing Co. common stock were exercised by Greg Lipsker and William R. Green 
(both directors of the Company).  The exercised price is $.005 per share, 
payable by a one year non-recourse promissory note bearing interest at 8% per 
annum.

SUBMISSION PAGE: 8 OF 12
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METALINE MINING & LEASING COMPANY
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

6 - FEDERAL INCOME TAXES

On June 5, 1998, the Company made a Federal Income Tax deposit in the amount 
of $158,000 to cover the estimated tax liability for 1998.

















































SUBMISSION PAGE: 9 OF 12
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ITEM 2     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION 
           AND RESULTS OF OPERATION

The Registrant has no revenues from operations.  It's only income has been 
derived from the sale of an investment and interest earned on the proceeds 
of that sale.

The Registrant's plan of operation for the next twelve months will consist of 
attempting to acquire an interest in a business opportunity.  Due to the 
Registrants limited assets and its inability to raise additional financing 
due to the lack of a market for it's Common stock, it is anticipated that any 
such acquisition would be a "reverse take-over" accomplished through a merger 
or share exchange.  In such event, the Registrant's existing shareholders 
would likely become minority shareholders in the surviving entity.  The 
Registrant is not currently evaluating any specific acquisition 
opportunities.

The Company does not currently have any employees and anticipates utilizing 
the services of consultants to accomplish it's plan of operation.  The 
Company currently has sufficient resources to meet it's financial obligations 
for the next twelve months.

PART II

ITEM 1     LEGAL PROCEEDINGS

           NONE

ITEM 2     CHANGES IN SECURITIES

           NONE

ITEM 3     DEFAULTS UPON SENIOR SECURITIES

           NONE

ITEM 4     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

           NONE

ITEM 5     OTHER INFORMATION

On November 18, 1998, the Registrant sold 7,277,834 shares of it's 
Common Stock to Mr. Albert Zlotnick for an aggregate price of $511,799.
The sales price was based upon the Registrants net assets at September 30, 
1998 less provisions for income taxes payable and the value of the 
Registrant's investment in a non-producing drilling project (see Note 4 to 
the Financial Statements).

Mr. Zlotnick has been appointed to fill a vacancy on the Board of Directors 
and has been appointed Chairman of the Board.  Mr. Zlotnick has the right to 
nominate one additional director to full the remaining vacancy on the Board 
of Directors.


ITEM 6     EXHIBITS AND REPORTS ON FORM 8-K

           NONE

SUBMISSION PAGE: 10 OF 12
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************************************************************************
                                 SIGNATURES
*************************************************************************

In accordance with Section 13 or 15(d) of the Exchange Act, the 
registrant caused this report to be signed on its behalf by the 
undersigned, thereunto duly authorized.

METALINE MINING & LEASING COMPANY
(Registrant)


By: /s/Gregory B. Lipsker                          Date:  November 20, 1998
__________________________________________
GREGORY B. LIPSKER, President
(Principal Executive Officer)

By: /s/ Eunice R. Campbell                         Date:  November 20, 1998
__________________________________________
EUNICE R. CAMPBELL, Secretary/Treasurer
(Principal Financial Officer)


































SUBMISSION PAGE: 11 OF 12

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