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 March 31, 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 March 31, 1998.


        Class                 Outstanding at March 31, 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
                                                  
 Item 1.   Financial Statements                                Page Number

        Condensed balance sheets - March 31, 1998
           and  December 31, 1997 (unaudited)                         3

        Condensed statements of operations and changes in
           retained earnings (accumulated deficit) - Three
           months ended March 31, 1998 and 1997 (unaudited)           4

        Condensed statements of cash flows - Three months
           ended March 31, 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



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                                                                     Page 3 of 9
                       ACTION PRODUCTS INTERNATIONAL, INC.
                            CONDENSED BALANCE SHEETS
                  ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                      March 31,    December 31,
                                        1998           1997
<S>                                 <C>            <C>
Current assets:                                    
  Cash and cash equivalents          $   117,100     $   537,800
  Accounts receivable, net of                      
   allowance of $25,500 at 
   March 31, 1998 and
   December 31, 1997                     803,600         720,000
  Notes Receivable                       303,300         575,000
  Inventories, net                     1,309,900       1,086,000
  Prepaid expenses                       125,600          58,600
                                                   
    Total Current Assets               2,659,500       2,977,400
                                                   
Property, plant and equipment,                     
 net of accumulated depreciation of                      
 $739,700 at March 31, 1998 and 
 $718,700 at December 31, 1997           914,600         923,400
Notes Receivable                       1,163,800       1,275,000
Other assets                             146,200         150,100
                                                   
    TOTAL ASSETS                       4,884,100       5,325,900
                                                   
Current liabilities:                               
 Accounts payable & accr exp             346,300         316,400
 Deferred Revenue                         75,000          75,000
 Income tax payable                       37,000          37,000
 Borrowings under line of credit         205,000         591,800
                                                   
    Total Current Liabilities            663,300       1,020,200
                                                   
Long term liabilities:                             
  Notes payable to shareholders          600,000         600,000
  Deferred Revenue                       225,000         225,000
  Deferred Income Taxes                  141,000         266,000
                                                   
Shareholder's equity:                              
Common stock $.001 par value                       
 authorized 7,500,000; 1,624,900 
 issued and outstanding at 
 March 31,1998 and December 31, 1997       1,600           1,600
Additional paid-in capital             3,008,300       3,008,300
Retained Earnings                        358,100         318,000
Stock Subscription Receivable          (113,200)       (113,200)
                                                   
     Total Shareholders' Equity        3,254,800       3,214,700
                                                   
TOTAL LIABILITIES AND                              
 SHAREHOLDERS' EQUITY                $ 4,884,100     $ 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 (ACCUMULATED DEFICIT)
                                   (UNAUDITED)
                                        
<TABLE>

<CAPTION>
                                    Three months ended
                                          March 31,
                                     1998          1997
<S>                                  <C>           <C>
Net sales                            $ 1,253,700   $ 1,144,400
Cost of sales                            648,200       668,200
                                                         
Gross profit                             605,500       476,200
                                                         
Selling, general &                                       
 administrative expenses                 560,900       525,200
                                                         
Other (expenses) income                                  
   Other                                  11,500         3,200
   Interest expense                      (16,000)      (17,900)
Total                                     (4,500)      (14,700)
                                                         
Income before income taxes                40,100       (63,700)
                                                         
Provision for income taxes                    -             -
                                                        
Net income (loss)                    $    40,100    $  (63,700)
                                                        
Beginning retained earnings            
 (accumulated deficit)                   318,000      (317,600)
                                                        
Ending retained earnings        
 (accumulated deficit)               $   358,100    $ (381,300)
                                                        
                                                        
Net inc (loss) per share - Basic     $      0.02    $    (0.04)
Net inc (loss) per share - Diluted   $      0.02    $    (0.04)
                                                         
Weighted average number of common                                  
 shares outstanding - Basic            1,624,900     1,549,900
                                                         
Weighted average number of common
 shares outstanding - Diluted          2,833,400     1,549,900

</TABLE>


                             See Accompanying Notes
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                                                                     Page 5 of 9
                       ACTION PRODUCTS INTERNATIONAL, INC.
                       CONDENSED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
                                        
                                        
<TABLE>

<CAPTION>                                   
                                    Three months ended
                                         March 31,
                                   1998              1997
<S>                                <C>               <C>
Cash flows from operating                                   
activities:
  Net income (loss)                $    40,100       $   (63,700)
Adjustments to reconcile net                             
 income to net cash provided by 
 (used in) operating activities:                                 
  Depreciation and amortization         35,400            59,900
                                                         
Change in assets and liabilities:                        
  Increase in current assets, 
   other than cash and cash
   equivalents                           8,400          (588,100)
                                                         
  Increase in current liabilities
   and deferred taxes                  (95,100)           24,500
                                                         
  Increase in other assets             (10,600)           (8,500)
                                                         
Net cash used in oper activities       (21,800)         (575,900)
                                                         
Net cash used in inv activities        (12,200)           (5,500)
                                                         
Net cash provided by fin activities   (386,700)          176,800
                                                         
Net decrease in cash and cash equiv   (420,700)         (404,600)
                                                         
Cash and cash equivalents at
 beginning of period                   537,800           463,100
                                                         
Cash and cash equivalents at 
 end of period                     $   117,100        $   58,500
                                                         
Supplemental disclosures - cash                          
paid for
      Interest                     $    16,000        $   17,900
      Taxes                        $   125,000        $       -

</TABLE>

                             See Accompanying Notes
<PAGE>

                                                                     Page 6 of 9
                       ACTION PRODUCTS INTERNATIONAL, INC.
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.  Condensed financial statements
In  the opinion of management, the accompanying unaudited condensed financial
statements  contain  all normal recurring adjustments  necessary  to  present
fairly the financial position of Action Products International, Inc. at March
31,  1998  and  the results of its operations and cash flows  for  the  first
quarter ending March 31, 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 March 31, 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.





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                                                                     Page 7 of 9

ITEM 2. Management's Discussion and Analysis of
        Financial Condition and Results of Operations

Any  statements  that are not historical facts contained in this discussion  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.

Results of Operations:
Revenues  increased to $1,253,700 during the first quarter ended March 31,  1998
from $1,144,400 in 1997, up ten percent.  Management attributes the increase  in
net  sales  to improved selling systems and channels, broader distribution,  and
the  earlier  availability of shippable inventories.  The Company  continues  to
benefit from its transition from a toy distributor to a toy maker, as sales from
proprietary  toy  lines have exceeded early expectations.  Improvements  to  the
sales  systems  have  eased diversification into new markets,  particularly  the
Company's  increasing  penetration  into  the  specialty  toy  market.   Further
improvements  to  marketing and merchandising, as well as  the  introduction  of
additional proprietary products in the latter part of last year also contributed
to the increase.

As  a  percent  of  sales,  gross  profit continued  its  upward  trend  with  a
substantial  increase to 48.3% from 41.6% for the same period in 1997,  in  line
with Management's focus on profitability.  Gross profit dollars increased 27% to
$605,500  from  $476,200 in the prior year.  Selling, General  &  Administrative
Expenses  increased  only  slightly, resulting in a  turnaround  net  income  of
$40,100,  or  $0.02 per share, from a net loss in the prior year of $63,700,  or
$0.04  per  share,  an  improvement  of  $103,800.   Management  attributes  the
turnaround  to  the  strong  performance  of  its  proprietary  toy  lines   and
improvements to the marketing and sales systems.

Financial Condition, Liquidity and Capital Resources:
As  of  March  31,  1998,  current assets were $2,659,500  compared  to  current
liabilities of $663,300 resulting in an improved current ratio of 4:1,  up  from
3:1  at December 31, 1997.  Total assets decreased to $4,884,100 from $5,325,900
at  December 31, 1997.  Current liabilities decreased $356,800 due primarily  to
repayments  of the Company's line of credit.  Current assets decreased  $317,900
due to primarily to payments received towards notes receivable and cash expended
to pay down the line of credit.

Accounts  receivable and inventories were $803,600 and $1,309,900, respectively,
at  March  31,  1998,  compared  to $720,000 and  $1,086,000,  respectively,  at
December  31,  1997.   The  increases are as a result of  the  Company's  normal
business cycle.

<PAGE>

                                                                     Page 8 of 9
ITEM 2. Management's Discussion and Analysis of Financial
        Condition and Results of Operations (Continued)


Cash  and  cash equivalents were down by $420,700, as cash was used to  position
the  Company  for  its peak period and pay down the Company's  line  of  credit.
Property, plant and equipment, net of depreciation, decreased by $8,800.   Other
assets were down $3,900.

Accounts payable and accrued expenses increased $29,900 to $346,300 at March 31,
1998 from $316,400 at December 31, 1997 due primarily to the timing of purchases
and  payments.   Net  borrowings under the line of  credit  were  paid  down  to
$205,000 at March 31, 1998 from $591,800 at December 31, 1997.

Cash  used in operations was $21,800 for the three months ended March 31,  1998,
as  compared to $575,900 for the comparable period in 1997.  This improvement is
due  to  the  turnaround in net earnings, the collection of  payments  on  notes
receivable, and the extent and timing of accruals and payments.

Shareholders'  equity  at March 31, 1998 increased by  $40,100  as  a  direct
result of net earnings.

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                                                                     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:   May 14,    1998              By:     /s/ Delton G. de Armas
                                            Delton G. de Armas
                                            Chief Financial Officer
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