SECURITIES AND EXCHANGE COMMISSION
                        Washington, D.C.  20549
                                   
                               FORM 10-Q
                                   
              Quarterly Report Under Section 13 or 15(d)
                of the Securities Exchange Act of 1934


  For the Quarter
Ended June 28, 1998                         Commission File Number 0-13433
-------------------                         ------------------------------

                           MILTOPE GROUP INC
--------------------------------------------------------------------------
         (Exact Name of Registrant as Specified in its Charter)



            Delaware                                        11-2693062
---------------------------------                       -------------------
   (State or other jurisdiction                          (I.R.S. Employer
of incorporation or organization)                       Identification No.)


 500 Richardson Road South
       Hope Hull, AL                                           36043
----------------------------------                      -------------------
    (Address of principal                                    (Zip Code)
     executive offices)


Registrant's telephone number, including area code (334) 284-8665

                                 Not Applicable
-------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report

    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 the number of shares outstanding of each of the issuer's
classes of common stock, as of the close of the period covered by this
report.  Outstanding at August 12, 1998: 5,871,523 shares of Common
Stock, $.01 par value.

<PAGE>
                    PART I - FINANCIAL INFORMATION
                  MILTOPE GROUP INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED BALANCE SHEETS
                              (unaudited)
<TABLE>
                                                        June 28,     December 31,
                                                          1998           1997
                                                      ------------   ------------
<S>                                                    <C>            <C>
ASSETS
CURRENT ASSETS:                                   
 Cash                                                  $   436,000    $   443,000
 Accounts receivable                                     5,141,000      9,977,000
 Inventories                                            17,164,000     14,703,000
 Deferred income taxes                                     345,000        345,000
 Other current assets                                      189,000        242,000
                                                       -----------    -----------
      Total current assets                              23,275,000     25,710,000
PROPERTY AND EQUIPMENT - at cost:                      -----------    -----------
 Machinery and equipment                                 7,305,000      7,177,000
 Furniture and fixtures                                  1,581,000      1,561,000
 Land, building and improvements                         8,088,000      8,021,000
                                                       -----------    -----------
      Total property and equipment                      16,974,000     16,759,000
 Less accumulated depreciation                           7,813,000      7,101,000
                                                       -----------    -----------
      Property and equipment - net                       9,161,000      9,658,000
                                                       -----------    -----------
DEFERRED INCOME TAXES                                    2,986,000      2,240,000
OTHER ASSETS                                               919,000        841,000
                                                       -----------    -----------
TOTAL                                                  $36,341,000    $38,449,000
LIABILITIES AND STOCKHOLDERS' EQUITY                  ============    ===========

CURRENT LIABILITIES:                              
 Accounts payable                                      $ 3,433,000    $ 4,437,000
 Accrued expenses                                        1,111,000      1,351,000
 Current maturities of long-term debt                      290,000        270,000
                                                       -----------    -----------
     Total current liabilities                           4,834,000      6,058,000
LONG-TERM DEBT                                          11,663,000     11,251,000
                                                       -----------    -----------
     Total liabilities                                  16,497,000     17,309,000
                                                       -----------    -----------
COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY:                    
Common stock - $.01 par value; 20,000,000 shares                   
 authorized; 6,811,112 shares outstanding at                68,000         68,000
 June 28, 1998 and December 31, 1997.

Capital in excess of par value                          20,264,000     20,264,000
Retained earnings                                       13,758,000     15,054,000
                                                       -----------    -----------
                                                        34,090,000     35,386,000
Less treasury stock                                     14,246,000     14,246,000
                                                       -----------    -----------
     Total stockholders' equity                         19,844,000     21,140,000
                                                       -----------    -----------
TOTAL                                                  $36,341,000    $38,449,000
                                                       ===========    ===========
</TABLE>
See Notes To Condensed Consolidated Financial Statements

<PAGE>
                  MILTOPE GROUP INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                              (unaudited)
<TABLE>
                                               Twenty-Six Weeks Ended
                                             ---------------------------
                                               June 28,        June 29,
                                                1998            1997
                                             -----------     -----------
<S>                                          <C>             <C>
NET SALES                                    $13,383,000     $21,034,000
COSTS AND EXPENSES:                          -----------     -----------
 Cost of sales                                10,389,000      16,193,000
                                 
  Selling, general and administrative          3,548,000       3,208,000 
                             
  Engineering, research and development        1,143,000         428,000 
                                             -----------     -----------
   Total                                      15,080,000      19,829,000 
                                             -----------     -----------
INCOME (LOSS) FROM OPERATIONS                 (1,697,000)      1,205,000 
                                            
INTEREST EXPENSE - net                           346,000         388,000 
                                             -----------     -----------
INCOME (LOSS) BEFORE INCOME TAXES             (2,043,000)        817,000 
                                       
INCOME TAX BENEFIT NET INCOME (LOSS)             747,000               -
                                             -----------     -----------
                                             $(1,296,000)    $   817,000
                                             ===========     ===========
BASIC AND DILUTED                              
  NET INCOME (LOSS) PER SHARE                $      (.22)    $       .14
WEIGHTED AVERAGE SHARES                      ===========     ===========
  OUTSTANDING                                  5,872,000       5,869,000
                                             ===========     ===========
</TABLE>
See Notes To Condensed Consolidated Financial Statements
<PAGE>
                  MILTOPE GROUP INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                              (unaudited)
                                   
<TABLE>                
                                                Thirteen Weeks Ended
                                             ---------------------------
                                                June 28,       June 29,
                                                  1997           1998
                                             -----------     -----------
<S>                                          <C>             <C>
NET SALES                                    $ 5,939,000     $11,992,000
COSTS AND EXPENSES:                          -----------     -----------
  Cost of sales                                4,883,000       9,334,000
  Selling, general and administrative          2,172,000       1,613,000
                            
  Engineering, research and development          676,000         202,000
                                             -----------     -----------
   Total                                       7,731,000      11,149,000
                                             -----------     -----------
INCOME (LOSS) FROM OPERATIONS                 (1,792,000)        843,000
INTEREST EXPENSE -  net                          180,000         201,000
                                             -----------     -----------
INCOME (LOSS ) BEFORE INCOME TAXES            (1,972,000)        642,000
INCOME TAX BENEFIT                               721,000               -
                                             -----------     -----------
NET  INCOME (LOSS)                           $(1,251,000)    $   642,000
BASIC AND DILUTED                            ===========     ===========
  NET INCOME (LOSS) PER SHARE                $     (0.21)    $       .11
WEIGHTED AVERAGE SHARES                      ===========     ===========
  OUTSTANDING                                  5,872,000       5,869,000
                                             ===========     ===========
</TABLE>
See Notes To Condensed Consolidated Financial Statements
<PAGE>
                  MILTOPE GROUP INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
    FOR THE TWENTY-SIX WEEKS ENDED JUNE 28, 1998 AND JUNE 29, 1997
                              (unaudited)
<TABLE>
                                                                  June 28,        June 29,
                                                                    1998            1997
                                                                -----------     -----------
<S>                                                             <C>             <C>
OPERATING ACTIVITIES:
 Net income (loss)                                              $(1,296,000)    $   817,000
 Adjustments to reconcile net income (loss) to net cash            
 provided by (used in) operating activities:

  Depreciation and amortization                                     724,000         808,000
  Provision for slow-moving and obsolete inventories                206,000         476,000
  Provision for doubtful accounts receivable                          5,000          50,000
  Deferred income taxes                                            (746,000)              -
  Change in operating assets and liabilities:                 
     Accounts receivable                                          4,831,000         736,000
     Inventories                                                 (2,668,000)       (749,000)
     Other current assets                                            53,000        (531,000)
     Other assets                                                   (89,000)        308,000
     Accounts payable and accrued expenses                       (1,244,000)         26,000
                                                                -----------      ----------
      Cash provided by (used in) operating activities              (224,000)      1,941,000
                                                                -----------      ----------
INVESTING ACTIVITIES:                               
    Purchase of property and equipment                             (215,000)       (985,000)
                                                                -----------      ----------
      Cash used in investing activities                            (215,000)       (985,000)
FINANCING ACTIVITIES:                               
    Proceeds (payments) from revolving credit loan - net            567,000        (928,000)
    Payments of other long-term debt                               (135,000)        (60,000)
    Exercise of stock options                                             -          11,000
                                                                -----------     -----------             
      Cash provided by (used in) financing activities               432,000        (977,000)   
                                                                -----------     -----------
NET DECREASE IN CASH                                                 (7,000)        (21,000)
CASH, BEGINNING OF PERIOD                                           443,000         128,000
                                                                -----------     -----------               
CASH, END OF PERIOD                                             $   436,000     $   107,000
                                                                ===========     ===========
SUPPLEMENTAL DISCLOSURE:                            
    Cash payments made for:                          
     Income taxes                                               $    66,835     $    65,000
                                                                ===========     ===========
     Interest                                                   $   324,000     $   414,000
                                                                ===========     ===========
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING                  
AND FINANCING ACTIVITIES
  Change in unrealized appreciation on investment available              
  for sale                                                      $         -     $   621,000
                                                                ===========     ===========
</TABLE>
See Notes To Condensed Consolidated Financial Statements
<PAGE>
              MILTOPE GROUP INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                          (unaudited)

1.     Financial  Statements  -  In  the  opinion  of  management,  the
accompanying  unaudited  condensed  consolidated  financial  statements
contain  all  adjustments  necessary (consisting  of  only  normal  and
recurring  accruals) to present fairly the financial  position  of  the
Company and its subsidiaries as of June 28, 1998 and December 31,  1997
and  the  results of operations and cash flows for the  twenty-six  and
thirteen weeks ended June 28, 1998 and June 29, 1997.

The  results for the twenty-six weeks ended June 28, 1998 and June  29,
1997  are not necessarily indicative of the results for an entire year.
It is suggested that these consolidated financial statements be read in
conjunction  with  the Company's Annual Report on  Form  10-K  for  the
fiscal year ended December 31, 1997.

Effective  January  1,  1998, the Company  adopted  the  provisions  of
Statement  of  Financial Accounting Standards (SFAS) No. 130  Reporting
Comprehensive   Income.   The  statement  requires  the   addition   of
comprehensive  income  and  its  components  in  the  Company's  annual
financial  statements.   Other  comprehensive  income  (loss)  includes
unrealized  investment  gains and losses, which  are  not  included  in
income under current accounting principles.  Total comprehensive income
(loss) for the quarters ended June 28, 1998 and June 29, 1997 were:

<TABLE>
                                   June 28, 1998       June 29, 1997
                                   -------------       -------------
<S>                                <C>                 <C>
Net income (loss)                  $ (1,296,000)       $    817,000
Other comprehensive income                    -             391,000
                                   ------------        ------------
Total comprehensive income (loss)  $ (1,296,000)       $  1,208,000
                                   ============        ============
</TABLE>

2.   Inventories - Net

Inventories consist of the following:
<TABLE>
                                   June 28, 1998      December 31, 1997
                                   -------------      -----------------   
<S>                               <C>                    <C>
Purchased parts and                         
  Subassemblies                    $  9,827,000          $ 10,019,000
Work-in-process                       7,337,000             4,684,000
                                   ------------          ------------
Total                              $ 17,164,000          $ 14,703,000
                                   ============          ============
</TABLE)

3.   Income  Taxes - The income tax benefit in 1998 is calculated using
the  estimated  year end effective  tax rate for 1998.  The  income tax
provision in the second  quarter of 1997 was  completely offset  by the
utilization of the Company's net operating loss carryforward.

<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

       The   following  discussion  includes  certain  forward  looking
statements which are affected by important factors including,  but  not
limited  to,  actions of competitors, termination of contracts  at  the
convenience   of   the  United  States  government,  customer   funding
variations  in  connection  with  multi-year  contracts  and  follow-on
options  that  could  cause actual results to  differ  materially  from
forward looking statements.

GENERAL
-------
      The  following  discussion and analysis presents certain  factors
affecting  the  Company's results of operations for the thirteen  weeks
and  twenty-six weeks ended June 28, 1998, as compared to the  thirteen
weeks and twenty-six weeks ended June 29, 1997.

RESULTS OF OPERATIONS
--------------------
Thirteen  weeks ended  June 28, 1998 compared to thirteen  weeks  ended
June 29, 1997
-----------------------------------------------------------------------
      Net  sales  for  the thirteen weeks ended June 28,  1998  (second
quarter of 1998) were $5,939,000 compared to net sales for the thirteen
weeks ended June 29, 1997 (second quarter of 1997) of $11,992,000.  The
decrease  in  sales  was  primarily attributable  to  the  Company  not
receiving  expected U.S. Government funding for the SPORT  program  and
decreased  Internet  terminal sales.  Management anticipates  receiving
additional funding for the SPORT program by the end of 1998 and  during
the remainder of the contract period through the year 2001.  Management
of  the  Company  continues  to pursue new business  opportunities  for
Internet terminals and anticipates receiving additional orders  in  the
future.

      The  gross margin percentage for the second quarter of  1998  was
17.8%  compared to 22.2% for the same period in 1997.  The decrease  is
primarily  attributable  to lower sales volume  and  a  less  favorable
product mix.

      Selling,  general  and  administrative expenses  for  the  second
quarter  of  1998 increased 34.7% from the second quarter of  1997,  to
$2,172,000.   These expenses as a percent of sales were  36.6%  in  the
second  quarter  of  1998 compared to 13.5% for the similar  period  in
1997.  The increase as a percent of sales is primarily attributable  to
lower sales volume and increased expenses related to employee severance
and  restructure  costs  incurred as a result of  streamlining  actions
taken to improve the Company's long term competitiveness.

      Company  sponsored engineering, research and development expenses
for the second quarter of 1998 increased 234.7% from the second quarter
of  1997, to $676,000.  These expenses as a percent of sales were 11.4%
in  the  second quarter of 1998 compared to 1.7% for the similar period
in  1997.  The increase as a percent of sales is primarily attributable
to lower sales volume, increased expenses related to employee severance
and restructure costs and increased amounts of research and development
for in-flight entertainment and cabin workstation products.

      Interest  expense, net of interest income, was  $180,000  in  the
second  quarter of 1998 compared to $201,000 for the similar period  in
1997.  The decrease reflects decreased debt compared to the prior year.

     Net loss for the second quarter of 1998 was $1,251,000 compared to
net  income of $642,000 in the second quarter of 1997.  The  basic  and
diluted  net  loss per share was $0.21 for the second quarter  of  1998
compared to the basic and diluted net income per share of $0.11 for the
similar period in 1997 based on a weighted average of 5,872,000  shares
and  5,869,000 shares of the Company's common stock outstanding for the
respective periods. The decrease in earnings was primarily attributable
to increased expenses and decreased sales.

Twenty-six  weeks  ended  June 28, 1998 compared  to  twenty-six  weeks
ended June 29, 1997
-----------------------------------------------------------------------
     Net sales for the twenty-six weeks ended June 28, 1998 (first half
of  1998)  were  $13,383,000 compared to net sales for  the  twenty-six
weeks  ended  June  29, 1997 (first half of 1997) of $21,034,000.   The
decrease  in  sales  was  primarily attributable  to  the  Company  not
receiving  expected U.S. Government funding for the SPORT  program  and
decreased  Internet  terminal sales. Management  anticipates  receiving
additional funding for the SPORT program by the end of 1998 and  during
the remainder of the contract period through the year 2001.  Management
of  the  Company  continues  to pursue new business  opportunities  for
Internet terminals and anticipates receiving additional orders  in  the
future.

      The  gross  margin percent for the first half of 1998  was  22.4%
compared  to 23.0% for the same period in 1997.  The decrease in  gross
margin percent was primarily attributable to lower sales volume  and  a
less favorable product mix.

     Selling, general and administrative expenses for the first half of
1998 increased 10.6% from the first half of 1997, to $3,548,000.  These
expenses  as  a percent of sales were 26.5% in the first half  of  1998
compared  to  15.3% for the similar period in 1997. The increase  as  a
percent  of  sales is primarily attributable to lower sales volume  and
increased expenses related to employee severance and restructure  costs
incurred  as  a  result of streamlining actions taken  to  improve  the
Company's long term competitiveness.

      Company  sponsored engineering, research and development expenses
for  the  first  half of 1998 increased 167.1% from the first  half  of
1997, to $1,143,000.  These expenses as a percent of sales were 8.5% in
the first half of 1998 compared to 2.0% for the similar period in 1997.
The  increase as a percent of sales is primarily attributable to  lower
sales  volume,  increased expenses related to  employee  severance  and
restructure costs and increased amounts of research and development for
in-flight entertainment and cabin workstation products.

      Interest  expense, net of interest income, was  $346,000  in  the
first half of 1998 compared to $388,000 for the similar period in 1997.
The  decrease  reflects decreased debt during the first  half  of  1998
compared to the prior year.

     Net loss for the first half of 1998 was $1,296,000 compared to net
income  of  $817,000 in the first half of 1997.  The basic and  diluted
net loss per share was $0.22 for the first half of 1998 as compared  to
the  basic  and diluted net income per share of $0.14 for  the  similar
period  in  1997  based on a weighted average of 5,872,000  shares  and
5,869,000  shares  of  the Company's common stock outstanding  for  the
respective periods. The decrease in earnings was primarily attributable
to increased expenses and decreased sales.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------
     Working capital approximated $18,441,000 at June 28, 1998 compared
to $19,652,000 at December  31, 1997.   Accounts  receivable  decreased
approximately $4,836,000 as a result  of  decreased sales.  Inventories
increased approximately  $2,461,000 as a result of the SPORT  contract.
Accounts payable  decreased approximately $1,004,000 reflecting  normal
payment terms and the lower sales volume.   Accrued  expenses decreased
approximately  $240,000  as  a  result of  decreased  employee  related
accrued liabilities.

     A $15 million revolving credit agreement, at the Company's option,
bears  interest at the bank's reference rate (8.50 % at June  28,  1998
and  December  31, 1997), or at a rate equaling the London  Inter  Bank
Offered  Rate (5.70% and 5.81% at June 28, 1998 and December 31,  1997,
respectively)  plus  2.0%.  If for any day the total  amount  advanced,
regardless  of  the  interest  rate option,  exceeds  $10  million,  an
additional  .25%  is added to the interest rate.  The revolving  credit
facility  is  scheduled to mature on May 31, 1999, at  which  time  the
outstanding  amount  would be converted into a  term  loan  payable  in
twelve  equal quarterly installments.  However, at the request  of  the
Company,  the  bank  may  extend  the revolving  credit  agreement  for
successive  one year periods based upon a review of the previous  year-
end  audited consolidated financial statements.  The Company's accounts
receivable,  contract rights and inventories are pledged as  collateral
to the agreement.
<PAGE>

PART II - OTHER INFORMATION

Item 1 - Legal Proceedings

     The  Company,  from  time  to time,  is  a  party  to  pending  or
     threatened  legal  proceedings  and  arbitrations.    Based   upon
     information presently available, and in light of legal  and  other
     defenses  available to the Company, management does  not  consider
     liability  from  any  threatened  or  pending  litigation  to   be
     material.

Item 6 - Exhibits and Reports on Form 8-K

       (a) Exhibits

            27.  Financial Data Schedule

       (b) Reports on Form 8-K

             None

<PAGE>
                               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.



                                   MILTOPE GROUP INC.


                                   By:/s/ James E. Matthews
                                      ------------------------------
                                      James E. Matthews,
                                      President and Chief Executive Officer
                                      (Principal Executive Officer)






Dated:  August 12 , 1998


</TABLE>