SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC  20549

                                   Form 10-QSB

                   QUARTERLY REPORT UNDER SECTION 13 or 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

For Quarter Ended September 30, 1998            Commission File Number
                                             Registration Number 2-93512-A




                       ACTION PRODUCTS INTERNATIONAL, INC.
             (Exact name of registrant as specified in its charter)




       Florida                                       59-2095427
(State or other jurisdiction of           (IRS Employer Identification No.)
incorporation or organization)

344 Cypress Road, Ocala, Florida                       34472-3108
(Address of principal executive offices)              (Zip Code)


Registrant's telephone number, including area code     (352) 687-2202


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 September 30, 1998.


        Class                           Outstanding at September 30, 1998
Common Stock, $.001 par value                         1,624,900

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                                                                    Page 2 of 9
                                    I N D E X

 PART I.                                  FINANCIAL INFORMATION  Page
                                                  Number
 Item 1.                                   Financial Statements

        Condensed Balance Sheets - September 30, 1998
           and December 31, 1997 (unaudited)                         3

        Condensed Statements of Operations and Changes
           in Retained Earnings - Three and nine months ended
           September 30, 1998 and 1997 (unaudited)                   4

        Condensed Statements of Cash Flows - Three and nine months
           ended September 30, 1998 and 1997 (unaudited)             5

        Notes to condensed financial statements                      6

 Item 2 Management's Discussion and Analysis of
        Financial Condition and Results of Operations                7 


        SIGNATURE PAGE                                               9







<PAGE>
                                                                  Page 3 of 9
                       ACTION PRODUCTS INTERNATIONAL, INC.
                            CONDENSED BALANCE SHEETS
                  ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY
                                   (UNAUDITED)
                                        
<TABLE>
<CAPTION>
                                 September 30, 1998   December 31, 1997
<S>                              <C>                  <C>                           
                                         
Current assets:                          
  Cash and cash equivalents               $ 254,200         $   537,800
  Accounts receivable, net               
   of allowance of $25,500 
   at September 30, 1998 and
   December 31, 1997                      1,121,800             720,000
  Inventories, net                        1,292,600           1,086,000
  Prepaid expenses                          144,100              58,600
  Notes receivable                          303,300             575,000
                                         
    Total Current Assets                  3,116,000           2,977,400
                                         
Property, plant and                      
 equipment, net of accumulated 
 depreciation of $799,000 at
 September 30, 1998 and                 
 $718,700 at December 31, 1997              876,600             923,400
Notes receivable                          1,161,500           1,275,000
Other assets                                189,700             150,100
                                         
    TOTAL ASSETS                         $5,343,800          $5,325,900
                                         
Current liabilities:                     
 Accounts payable &           
  accrued expenses                       $  299,100          $  353,400
 Deferred revenue                            50,000              75,000
 Borrowings under line of credit            337,000             591,800
                                         
    Total Current Liabilities               686,100           1,020,200

                                         
Long term liabilities:                   
  Deferred income taxes                     178,000             266,000
  Deferred revenue                          211,500             225,000
  Notes payable                             600,000             600,000
                                                    
Shareholders' equity:                   
Common stock $.001
 par value authorized 15,000,000; 
 1,624,900 issued and outstanding 
 at September 30,1998 and
 December 31, 1997                            1,600               1,600
Capital in excess of par value            3,008,300           3,008,300
Stock subscriptions receivable              (99,300)           (113,200)
Retained earnings                           757,600             318,000
                                         
     Total Shareholders' Equity           3,668,200           3,214,700

                                         
TOTAL LIABILITIES AND                    
 SHAREHOLDERS' EQUITY                   $ 5,343,800         $ 5,325,900
                                                    
</TABLE>



                             See Accompanying Notes
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                                                                 Page 4 of 9
                       ACTION PRODUCTS INTERNATIONAL, INC.
                       CONDENSED STATEMENTS OF OPERATIONS
                        AND CHANGES IN RETAINED EARNINGS
                                   (UNAUDITED)
                                        
<TABLE>
<CAPTION>
                             Three months ended      Nine months ended
                               September 30            September 30
                             1998        1997        1998        1997
<S>                          <C>         <C>         <C>         <C>           
Net Sales                    $1,764,800  $1,700,500  $4,846,300  $4,654,500
Cost of Sales                   940,500     918,800   2,524,300   2,585,300
                                                              
Gross Profit                    824,300     781,700   2,322,000   2,069,200
                                                                
Selling, General &                                              
 Administrative Expenses        760,500     623,600   2,027,900   1,703,500
                                                                
Other (expenses) income                                         
   Other                        119,000         300     200,900       4,700
   Interest expense             (26,400)    (25,800)    (55,400)    (66,800)
Total                            92,600     (25,500)    145,500     (62,100)
                                                                
Income before income taxes      156,400     132,600     439,600     303,600
Provision for income taxes          -           -           -           -

Net Income                      156,400     132,600     439,600     303,600

Beginning retained earnings                                   
(accumulated deficit)           601,200    (146,600)    318,000    (317,600)
                                                              
Ending retained earnings 
(accumulated deficit)        $  757,600  $  (14,000) $  757,600  $  (14,000)

Net Income per share                                          
  Basic                      $     0.10  $     0.09  $     0.27  $     0.20
  Diluted                    $     0.06  $     0.05  $     0.16  $     0.12

Weighted average number of                                        
 common shares outstanding
  Basic                       1,624,900   1,549,900   1,624,900   1,549,900
  Diluted                     2,807,200   2,739,200   2,828,700   2,739,200

</TABLE>

                             See Accompanying Notes
<PAGE>

                                                                  Page 5 of 9
                       ACTION PRODUCTS INTERNATIONAL, INC.
                       CONDENSED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
                                        
<TABLE>
<CAPTION>
                              Three months ended       Nine months ended
                                 September 30            September 30
                              1998       1997          1998        1997
<S>                           <C>        <C>           <C>         <C>
Cash flows from operating                                         
activities:
 Net income                   $156,400   $132,600      $439,600    $303,600
                                                                      
Adjustments to reconcile net                                    
 income to net cash provided 
 by(used in)operating 
 activities:                                          
  Depreciation                   38,300    25,600        80,300      79,500
                                                                
Change in assets and                                            
liabilities:
  Decrease (increase) in                                        
   current assets other than  
   cash and cash equivalents    286,800    92,800      (308,700) (1,113,200)
                                                                 
  Decrease in current         
   liabilities                 (364,500) (313,800)     (180,800)   (133,000)
                                                                
  Decrease (increase) in                                               
   other assets                 (31,700)   29,000       (39,600)     71,200
                                                                
Net cash provided by (used
 in) operating activities        85,300   (33,800)       (9,200)   (791,900)
                                                                
Net cash used in investing 
 activities                      (9,600)   (5,800)      (33,500)    (14,100)
                                                                
Cash flows from financing                                       
activities:
  Proceeds from (repayments                                     
   of) borrowings on line 
   of credit, net                 1,000   135,000      (254,800)    376,800
                                                                
  Results of other financing                                           
   activities                    13,900       -          13,900      69,400
                                 
                                                 
                                                                
  Net cash (used in)                                                   
   provided by fin. activities   14,900   135,000      (240,900)    446,200
                                                                
  Net increase (decrease) in     
   cash and cash equiv.          90,600    95,400      (283,600)   (359,800)
                                                                
Cash and cash equivalents at                                           
 start of period                163,600     7,900       537,800     463,100
                                                                
Cash and cash equivalents at
 end of period                 $254,200  $103,300      $254,200    $103,300
                                                                
Supplemental disclosures -                                      
 cash paid for
   Interest                     $26,400   $25,800       $55,400     $66,900
   Taxes                        $     0   $     0       $     0     $     0


</TABLE>

                             See  Accompanying Notes
<PAGE>
                                                                  Page 6 of 9
                                        
                                        
                       ACTION PRODUCTS INTERNATIONAL, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.  Condensed consolidated financial statements
In   the   opinion  of  management,  the  accompanying  unaudited   condensed
consolidated  financial statements contain all normal  recurring  adjustments
necessary  to  present  fairly  the financial  position  of  Action  Products
International,  Inc. at September 30, 1998 and the results of its  operations
and cash flows for the three and nine month periods ended September 30, 1998.

Certain  information and footnote disclosures normally included in  financial
statements   prepared  in  accordance  with  generally  accepted   accounting
principles  have  been  condensed or omitted.  It  is  suggested  that  these
condensed  financial  statements be read in conjunction  with  the  financial
statements and notes thereto included in the Company's report on Form  10-KSB
for  the  year  ended December 31, 1997.  The results of operations  for  the
period  ended  September  30,  1998 are not  necessarily  indicative  of  the
operating results for the full year.

2.  Income per common share
In  February 1997, the Financial Accounting Standards Board issued  Statement
of  Financial Accounting Standards (SFAS) No. 128, which is effective for the
periods  ending  after  December  15,  1997.   SFAS  No.  128  replaces   the
presentation  of  primary  earnings per share with a  presentation  of  basic
earnings  per  share based upon the weighted average number of common  shares
for the period.

3.  Convertible Debt
At   September  30,  1998,  the  Company  had  long-term  debt   payable   to
shareholders, resulting primarily from working capital loans and the purchase
of  the  Company''s  plant  facility and real property  in  prior  years,  as
follows:   unsecured  promissory notes payable to  related  parties,  bearing
interest  at 9% per annum, monthly payments of interest only until  September
1,  2002,  with 24 monthly payments of principal and interest of $27,400  due
thereafter,  convertible at any time in whole or in  part  at  the  lender''s
option  after  May 9, 1995, into common shares of the Company at  $0.579  per
share.   The Company has reserved, from its authorized but unused  shares  of
common  stock,  1,036,300 shares for use in the event the long-term  debt  is
converted.  During the third quarter, the Company issued warrants to purchase
1,036,300 shares at the same conversion price in exchange for the removal  of
the convertibility feature of the debt.  The remaining terms and features  of
the debt are unchanged.

<PAGE>
                                                                  Page 7 of 9
ITEM 2. Management's Discussion and Analysis of
        Financial Condition and Results of Operations

Results of Operations:

Any  statements contained in this discussion that are not historical  facts  are
forward-looking  statements.   It  is possible  that  the  assumptions  made  by
management for purposes of such statements may not materialize.  Actual  results
may  differ  materially from those projected or implied in  any  forward-looking
statements.  Such statements may involve risks and uncertainties, including  but
not limited to those relating to product demand, pricing, market acceptance, the
effect  of economic conditions, and intellectual property rights and the outcome
of  competitive products, risks in product development, the results of financing
efforts,  the  ability to complete transactions, and other risks  identified  in
this and the Company''s other Securities and Exchange Commission filings.

Three months ended September 30, 1998
Revenue  increased again during the three month period ended September 30,  1998
to  a  third  quarter record $1,764,800 in 1998 from the previous third  quarter
high  of  $1,700,500  set in 1997.  Stronger than expected sales  from  its  new
proprietary  lines  contributed to the gain, particularly in light  of  foregone
sales  of  product  lines divested in the fourth quarter  of  1997.   The  third
quarter  1998  net  income  also improved to a new  record  of  $156,400  versus
$132,600  for  the  1997  comparable period due to the increases  in  sales  and
continued growth in the gross margins.

Gross profit increased $42,600 to $824,300 from $781,700.  Management attributes
its   gross   profitability   strength  to  additional   proprietary   products,
divestitures  of  lower  margin lines, and continued improvement  of  terms  and
pricing  with  overseas  vendors.  Selling, General  &  Administrative  Expenses
increased  $136,900.  Management attributes the increase in expenses to  certain
sales  and marketing expenditures, including additional salaries and commissions
connected with the Company''s strengthening of its marketing staff, sales force,
and  outside sales representative organizations, as well as expenses related  to
corporate  development.  Other income improved significantly to $92,600  due  to
gains  on  the  disposal of assets and the recognition of  deferred  revenue  in
connection with the divestiture of certain product lines.

Nine months ended September 30, 1998
Record nine months revenue for the period ended September 30, 1998 of $4,846,300
in  1998  improved  over  the record set in the prior  year  of  $4,654,500,  up
$191,800.   Management attributes the increase in net sales to the planning  and
implementation  of  its  focused strategy and stronger  than  expected  results,
including  improved  selling systems and channels, broader  distribution,  sales
from  its  new  proprietary  lines, and the earlier  availability  of  shippable
inventories.   The nine months 1998 net income was $439,600 versus  $303,600  in
1997,  an improvement of 45%, due to the continued improvement of gross margins;
other  income  from  gains  on the disposal of assets  and  the  recognition  of
deferred  revenue in connection with the divestiture of certain  product  lines;
and  the  increase in sales.  The increase in sales is attributable in  part  to
significant  merchandising  and  marketing  efforts;  sustained  sales  of   its
continuing core of proprietary product lines; and a strengthened effort by sales
management to expand the sales force and broaden the market base.
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                                                                     Page 8 of 9

Gross  profit increased $252,800 to $2,322,000 from $2,069,200, up  12%.   As  a
percent  of  sales,  gross  profit improved again  to  48%  after  the  dramatic
improvement  to 46% for the 1997 comparable period.  Management attributes  this
sustained  improvement  in  gross profit percentage  to  additional  proprietary
products, divestiture of lower margin lines, and continued improvement of  terms
and  pricing with overseas vendors.  Selling, General & Administrative  Expenses
for  the nine months ended increased $324,400, or 19%.  As previously discussed,
management  attributes the increase in expenses to certain sales  and  marketing
expenditures, including additional salaries and commissions connected  with  the
Company''s strengthening of its marketing staff, sales force, and outside  sales
representative  organizations,  as well as certain  expenditures  for  corporate
development.  Other Income (Expense) improved significantly to $145,500 for  the
nine  months  ended  September 30, 1998 compared to Other  Income  (Expense)  of
($62,100) for the same 1997 period, due to gains on the disposal of assets,  the
recognition  of deferred revenue in connection with the divestiture  of  certain
product lines, and reductions in interest expense.

Financial Condition, Liquidity and Capital Resources
As  of  September 30, 1998, current assets were $3,116,000 compared  to  current
liabilities of $686,100 for a current ratio of 4.5:1, up from 2.9:1 at  December
31,  1997.  At September 30, 1998, working capital improved by $472,700 compared
to December 31, 1997.

Historically,  the peak period of the Company's business cycle  has  been  March
through  August.  Thus, accounts receivable and inventories were $1,121,800  and
$1,292,600,  respectively,  at  September 30,  1998  compared  to  $720,000  and
$1,086,000, respectively, at December 31, 1997.  The increase in receivables and
inventories  are  considered normal for the Company and  reflect  the  increased
activity in the Company''s high volume period.  Current liabilities decreased by
$334,000 due primarily to reduced draws on the Company''s line of credit.

Cash  and  cash  equivalents were down $283,600 from December 31,  1997  but  up
$90,600  from June 30, 1998.  Operations provided cash flow of $85,300  for  the
three  months ended September 30, 1998 compared to cash flow used in  operations
of  $33,800  for the comparable period ended September 30, 1997.  This  positive
swing is due primarily to improved earnings before interest, taxes, depreciation
and  amortization (EBITDA) and seasonal increases in inventory  since  June  30,
1998.   Cash  flow  used  in operations was $9,200 for  the  nine  months  ended
September 30, 1998 compared to $791,900 used in the comparable nine month period
ended September 30, 1997.  The improvement is primarily due to better control of
seasonal increases in inventories associated with the Company''s peak period and
payments received on notes receivable.

Shareholders'' equity at September 30, 1998 increased during the nine months  by
$453,500  to  $3,668,200 due to earnings and the receipt of  payments  of  stock
subscriptions from related parties.

<PAGE>

                                                                    Page 9 of 9


                                   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.



                       Action Products International, Inc.




       Date:     November 12, 1998     By:    /s/ Delton G. de Armas
                                              Delton G. de Armas
                                              Chief Financial Officer

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