FORM 10-QSB


                    SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C. 20549
                                   

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

       For the quarterly period ended March 31, 1998

       Commission file number 0-22450

(   )  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
       SECURITIES EXCHANGE ACT OF 1934

       For the transition period from                to                

       For quarter ended                 Commission File Number               
     

                          COUNTRY WORLD CASINOS, INC.
               (Name of Small Business Issuer in its charter)

                Nevada                                     13-3140389
(State of jurisdiction of incorporation)          (IRS Employer I.D. Number)


       200 Monument Road, Suite 10, Bala Cynwyd, Pennsylvania 19004
                 (Address of principal executive offices)

Registrant's telephone number  (610) 617-9990

     Check whether the registrant (1) has filed all reports required to be
filed by Sections 13 or 15(d) of the Securities Exchange Act during the past
12 months (or for such shorter period as 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 class of
common stock.  The Registrant had 14,331,687 shares of its common stock
outstanding as of March 31, 1998.

<PAGE>

COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

INDEX


Part I:  FINANCIAL INFORMATION

Item 1.  Financial Statements

       Balance Sheet as of March 31, 1998 (Unaudited). . . . . . . 1 - 2

       Statements of Operations for the nine months ended
         March 31, 1998 and 1997 and for the period from
         November 9, 1982 (Date of Inception) through
         March 31, 1998 (Unaudited). . . . . . . . . . . . . . . . 3

       Statements of Stockholders' Equity (Unaudited). . . . . . . 4 - 6

       Statements of Cash Flows for the nine months ended
         March 31, 1998 and 1997 and For the period from
         November 9, 1982 (Date of Inception) through
         March 31, 1998 (Unaudited). . . . . . . . . . . . . . . . 7 - 9

       Notes to Financial Statements (Unaudited) . . . . . . . . . 10

Item 2.  Management's Discussion and Analysis or Plan of Operation 11 - 15

Part II:  OTHER INFORMATION

Item 1.   Legal Proceedings. . . . . . . . . . . . . . . . . . . . 16 - 18

Item 3.   Defaults upon Senior Securities. . . . . . . . . . . . . 19

Item 6.   Exhibits and Reports on Form 8-K . . . . . . . . . . . . 19


Signature Page . . . . . . . . . . . . . . . . . . . . . . . . . . 20

<PAGE>

COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

BALANCE SHEET AS OF MARCH 31, 1998 (UNAUDITED)


ASSETS:
CURRENT ASSETS:
 Cash                                                       66
 Prepaid Interest                                       61,290
 Prepaid Expenses                                       37,500
 Due From Parent                                         8,706

 TOTAL CURRENT ASSETS                                  107,562
 

PROPERTY AND EQUIPMENT: 
 Land                                                7,475,476
 Casino Under Development                            9,587,413
 Furniture and Fixtures                                 38,888
 Total                                              17,101,777
 Less Accumulated Depreciation                         (21,774)

 Total Property and Equipment                       17,080,003


OTHER ASSETS
 Deposits                                               35,630

 TOTAL ASSETS                                      $17,223,195 


See Notes to Financial Statements

                                     1
<PAGE>

COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

BALANCE SHEET AS OF MARCH 31, 1998 (UNAUDITED)


LIABILITIES AND STOCKHOLDERS' EQUITY:
CURRENT LIABILITIES:
 Accounts Payable                                    3,003,678
 Payroll and Property Taxes Payable                    139,652
 Accrued Expenses                                        7,000
 Accrued Interest - Related Parties                    250,065
 Notes Payable - Related Parties                     2,853,610
 
 TOTAL CURRENT LIABILITIES                           6,254,005
LONG-TERM LIABILITIES:
 Notes Payable                                       2,650,000 
 Notes Payable - Related Party                       2,350,000 

   TOTAL LONG-TERM LIABILITIES                       5,000,000


STOCKHOLDERS' EQUITY:
 Convertible Preferred Stock.  Series A. $.001 Par
  Value 2,250,000 Shares Authorized, 2,250,000
  Shares Issued and Outstanding (Liquidation
  Preference $7,492,500)                                 2,250 

 Common Stock, $.001 Par Value, 75,000,000 Shares
  Authorized, 14,331,687 Issued and Outstanding         14,332 

 Convertible Preferred Stock, Class B, $.25 Par
  Value, 5,000,000 Shares Authorized, 4,000,000
  Shares Issued and Outstanding (Liquidation
  Preference $1,000,000)                             1,000,000 

 Additional Paid-in Capital                         10,216,474 

 Deficit Accumulated During the Development Stage   (5,263,866)

 TOTAL STOCKHOLDERS' EQUITY                          5,969,190

 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY     $   17,223,195

See Notes to Financial Statements

                                     2
<PAGE>

COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF OPERATIONS (UNAUDITED)

 
                                                         FOR THE PERIOD FROM
                                                           NOVEMBER 9, 1982
                                                         (DATE OF INCEPTION)
                                    NINE MONTHS ENDED           THROUGH
                                         MARCH 31,              MARCH 31,
                                       1998      1997             1998

COSTS AND EXPENSES:
 Research and Development Costs     $         $               $  122,000
 Loss on Non-Marketable Securities                                85,000
 Write-Off of Loan Receivable                                     90,000    
 General and Administrative Expenses  818,605   410,530        4,055,643
 Management Fee - Related Party                                  408,000
 Depreciation                           4,743     4,672           47,257

 TOTALS                               823,348   415,202        4,807,900

OTHER INCOME (EXPENSE):
 Interest Income                       14,678    26,079          109,490
 Interest Expense                     (92,267)   (3,931)        (163,712)
 Professional Fees-Due to Bankruptcy  (23,083)                  (514,757)
 Forfeited Deposit                                              (100,000)
 Other Income                                       735           45,861

 TOTALS                              (100,672)   22,883         (623,208)

 (Loss) from Continuing Operations
  Before Discontinued Operations
  and Extraordinary Item             (924,020) (392,319)      (5,431,018)

DISCONTINUED OPERATIONS:
 Gain on Disposal of Subsidiaries                                389,286
 (Loss from Discontinued Operations                             (389,286)

 Total Discontinued Operations                                     
 
 (LOSS) BEFORE EXTRAORDINARY ITEM    (924,020) (392,319)      (5,431,018)

EXTRAORDINARY ITEM:
 Extraordinary Gain on Forgiveness of Debt                       167,152

 NET (LOSS)                        $ (924,020)$(392,319)    $ (5,263,866)

PER SHARE DATA:
 Net (Loss) Per Common Share       $    (0.07)     (0.06) 


WEIGHTED AVERAGE NUMBER OF SHARES  13,488,243  6,694,097
 

See Notes to Financial Statements

                                     3
<PAGE>
<TABLE>
COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

STATEMENT OF STOCKHOLDERS' EQUITY
                                                                                                               Deficit
                                                                                                             Accumulated   Total
                                      Preferred Stock                    Common Stock             Additional  During the   Stock-
                               Series A           Series B                          Subscribed     Paid-In    Development  holders'
                           Shares   Amount    Shares   Amount   Shares  Amount   Shares   Amount   Capital      Stage      Equity
<S>                         <C>       <C>      <C>      <C>       <C>     <C>      <C>      <C>      <C>         <C>         <C>
,
November 9, 1982 (Date
 of Inception)                      $                  $                $                 $       $           $            $

Issuance of Shares for
 Cash ($.51 Per Share)                                           2,971     15                       1,510                    1,525
 
Issuance of Common Stock
 to the Public ($12.50
 Per Share)                                                      1,474      8                     644,992                  645,000

Deferred Offering Costs                                                                          (115,690)                (115,690)

Cancellation of Common Stock                                      (800)    (4)                          4

Issuance of Shares for Services
 ($.18 Per Share)                                               85,714    429                      14,571                   15,000

Issuance of Common Stock at a
 Discount ($.02 Per Share)                                   1,339,212  6,696                      13,304                   20,000

Capital Contribution                                                                                2,850                    2,850

Net Loss for the Period From
 November 9, 1982 (Date of
 Inception) Through
 June 30, 1992                                                                                                 (221,169)  (221,169)

 BALANCE - JUNE 30, 1992                                     1,428,571  7,144                     561,541      (221,169)   347,516

Issuance of Common Stock at
 a Discount for Services
 ($.02 Per Share, May 1993                                     714,287  3,571                       8,929                   12,500

Net Loss for Year Ended
 June 30, 1993                                                                                                 (373,401)  (373,401)

 BALANCE - JUNE 30, 
   1993 - FORWARD                   $                  $     2,142,858 $10,715           $       $570,470    $ (594,570)  $(13,385)


See Notes to Financial Statements

                                                                    4
</TABLE>
<PAGE>
<TABLE>
COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

STATEMENT OF STOCKHOLDERS' EQUITY
                                                                                                               Deficit
                                                                                                             Accumulated   Total
                                      Preferred Stock                    Common Stock             Additional  During the   Stock-
                               Series A           Series B                          Subscribed     Paid-In    Development  holders'
                           Shares   Amount    Shares   Amount   Shares  Amount   Shares   Amount   Capital      Stage      Equity
<S>                         <C>       <C>      <C>      <C>       <C>     <C>      <C>      <C>      <C>         <C>         <C>

 BALANCE - JUNE 30,
   1993 - FORWARD                   $                  $     2,142,858 $10,715           $       $570,470     $(594,570)  $(13,385)

Change in Par Value
 from $.005 to $.001                                                    (8,572)                     8,572
      
Issuance of Shares for
 Cash September 1993
 ($1.00 Per Share)                                             600,000     600                    599,400                  600,000
 
Issuance of Shares for
 Cash September 1993
 ($1.00 per Share                                            1,500,000   1,500                  1,498,500                1,500,000

Issuance of Convertible
 Preferred Stock for
 Acquisition of Land
 Valued at $1.00 Per
 Share Issued July 1993  2,250,000   2,250                                                      2,247,750                2,250,000

Issuance of Stock to
 Related Party for Cash
 and Services Pursuit to
 Exercise of Options
 ($1.00 Per Share)                                             250,000     250                    249,750                  250,000

Purchase and Cancellation of
 Treasury Stock ($1.00 Per Share                              (125,000)   (125)                  (124,875)                (125,000)

Issuance of Stock for Cash
 (140,000 Shares and 60,662
 Shares Issued December 1993
 and January 1994, Respectively)
 at $2.50 Per Share                                            200,000     200                    499,800                  500,000

Balance of Common Stock for
 Acquisition of Land Valued at
 $1.00 Per Share Issued June 1994                              250,000     250                    249,750                  250,000

Issuance of Common Stock for
 Cash and Services Pursuant
 to Exercise of Options (75,000
 Shares and 20,000 Shares Issued
 April and June 1994 Respectively
 at $2.50 Per Share)                                            95,000      95                   237,405                   237,500

Issuance of Common Stock for
   Services Rendered Valued at
    $2.50 Per Share Issued April 1994                          200,000     200                   499,800                   500,000

Subscription of Common Stock
 Pursuant to Private Placement
 Offering ($3.00 Per Share)                                                     262,667    263   787,737                   788,000

Net Loss for Year Ended
 June 30, 1994                                                                                              (1,490,785) (1,490,785)

 BALANCE - JUNE 30,
  1994 - FORWARD          2,250,000 $ 2,250            $     5,113,520 $ 5,113  262,667  $  263 $7,324,059 $(2,085,355) $5,246,330

See Notes to Financial Statements

                                                                    5
</TABLE>
<PAGE>
<TABLE>
COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

STATEMENT OF STOCKHOLDERS' EQUITY
                                                                                                               Deficit
                                                                                                             Accumulated   Total
                                      Preferred Stock                    Common Stock             Additional  During the   Stock-
                               Series A           Series B                          Subscribed     Paid-In    Development  holders'
                           Shares   Amount    Shares   Amount   Shares  Amount   Shares   Amount   Capital      Stage      Equity
<S>                         <C>       <C>      <C>      <C>       <C>     <C>      <C>      <C>      <C>         <C>         <C>

,
 BALANCE - JUNE 30,
  1994 - FORWARD          2,250,000 $ 2,250            $     5,113,520 $ 5,113  262,667  $  263 $7,324,059 $(2,085,355) $5,246,330

Issuance of Common Stock
 Pursuant to Private
 Placement Offering
 ($2.67 Per Share)                                            460,000     460                    1,229,040               1,229,500
 
Issuance of Stock for
 Outstanding  Note
 Issued April 20, 1995
 ($.20 Per Share)                                           5,000,000   5,000                    1,009,451               1,014,451

Convert Subscribed Stock
 to Common and Record Fees                                    262,667     263  (262,667)   (263)

Net Loss for Year Ended
 June 30, 1995                                                                                                 (757,659)  (757,659)

 BALANCE - JUNE 30, 1995  2,250,000 $ 2,250                10,836,187  10,836                    9,562,550   (2,843,014) 6,732,622

Net Loss for Year Ended
 June 30, 1996                                                                                                 (416,440)  (416,440)

 BALANCE - JUNE 30, 1996  2,250,000 $ 2,250                10,836,187  10,836                    9,562,550   (3,259,454) 6,316,182

Issuance of Preferred Stock -
 Class B in Exchange for 
 Related Party Debt ($.25
 Per Share) April 1997                    4,000,000 1,000,000                                                             ,000,000

Common Stock Issued in
 Exchange for Debt ($.25
 Per Share) April 1997                                      1,250,000   1,250                      248,750                 250,000

Warrants Issued for 1,000,000
 Shares of Common Stock in
 Connection with Norlar, Inc.
 Debt Financing ($.06 Per Warrant                                                                   60,000                  60,000

Net Loss for Year Ended
 June 30, 1997                                                                                               (1,080,391)(1,080,391)

 BALANCE - JUNE 30,
  1997                    2,250,000 2,250 4,000,000 1,000,000 12,086,187 12,086                  9,871,300   (4,339,845) 6,545,791
 
Issuance of Common Stock for
 Services Rendered Valued
 at $.20 per Share, July 1997                               1,000,000   1,000                      199,000                 200,000

Issuance of Common Stock in
 Exchange for Debt and
 Services to be Rendered
 ($.1875 Per Share) September 1997                            395,500     396                       73,761                  74,157

Issuance of Common Stock for
 Services Rendered and Debt
 Exchange ($.086 Per Share)
 March 1998                                                    85,000     850                       72,413                  72,263

Net Loss for the Nine Months
 Ended March 31, 1998                                                                                          (924,020)  (924,020)

 BALANCE-MARCH 31, 1998  2,250,000 $2,250 4,000,000 $1,000,000 14,331,687 $14,332         $     $10,216,474 $(5,263,866)$5,968,190

See Notes to Financial Statements

                                                                    6
</TABLE>
<PAGE>

COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)


                                                            FOR THE PERIOD FROM
                                                             NOVEMBER 9, 1982
                                                            (DATE OF INCEPTION)
                                        NINE MONTHS ENDED         THROUGH
                                             MARCH 31,            MARCH 31,
                                         1998       1997            1998

OPERATING ACTIVITIES:
 Continuing Operations:
  (Loss) Before Extraordinary Item   $(924,020)   $(392,319)    $(5,431,017)
  Adjustments to Reconcile Net
  (Loss) to Net Cash
   (Used for) Operating Activities:
   Depreciation                          4,743        4,672          47,257
   Amortization of Discount             45,000                       60,000
   Common Stock Issued for Interest                                  14,451
   Common Stock Issued for Services                                 933,307
   Loss on Marketable Securities                                    (85,000)
   Write Off of Loan Receivable                                     (90,000)
   Extraordinary Item                                               167,152
   Accrued Interest Related Parties                                  52,514
   Allocation of Management Fees                                    408,000

 Changes in Assets and Liabilities:
  (Increase) Decrease in:
   Noncurrent Assets                                                (35,630)
   Prepaid Interest                    11,850                       (61,290)
   Prepaid Expenses                   (37,500)      562,500         (37,500)
   Due from Parent                     (8,706)                       (8,706)

  Increase (Decrease) in:
   Accounts Payable                 2,965,563      (638,193)      3,003,678
   Payroll and Property Taxes
    Payable                            44,191                       139,652
   Accrued Interest                    74,122                       250,065
   Accrued Expenses                   (21,778)     (461,062)          7,000

 Discontinued Operations:
  Net (Loss)                                                       (389,286)
  Adjustment to Reconcile Net (Loss)
   to Net Cash (used for) Operating
   Activities:
  Gain on Disposal of Assets                                        389,286

  Total Adjustments                 3,173,292      (532,083       4,800,580

NET CASH USED PROVIDED BY
 OPERATING ACTIVITIES - FORWARD     2,249,272      (924,402)       (630,437)


See Notes to Financial Statements

                                     7
<PAGE>


COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)


                                                            FOR THE PERIOD FROM
                                                             NOVEMBER 9, 1982
                                                            (DATE OF INCEPTION)
                                        NINE MONTHS ENDED         THROUGH
                                           DECEMBER 31,           MARCH 31,
                                        1998        1997            1998

 NET CASH PROVIDED (USED) BY OPERATING 
  ACTIVITIES - FORWARDED           $ 2,249,272     (924,402)      (630,437)
 
INVESTING ACTIVITIES:
 Purchase of Land and Payment
  of Casino Development Costs       (4,193,334)    (346,966)    (9,408,205)
 Disposal (Purchase) of Furniture
  and Fixtures                           5,209                     (52,197)
 Investment in Patents                                             (62,000)
 Deposits and Other                    (35,000)                    (35,630)
 (Increase) Decrease in
  Restricted Cash                                 1,817,213           
  
 NET CASH PROVIDED (USED)
  BY INVESTING ACTIVITIES           (4,223,125)   1,470,247     (9,558,032)

FINANCING ACTIVITIES:
 Payment of Capital Lease Obligation                                (4,233)
 Proceeds from Long-Term Borrowings                              6,000,000
 Advances to/from Related Party      1,731,732      580,164      2,853,610
 Repayments on Borrowings              (14,382)  (1,111,353)    (4,136,140)
 Proceeds from Stock and Warrant
  Issuance                             251,613                   5,472,448
 Capital Contribution                                                2,850

 NET CASH PROVIDED (USED) BY
  FINANCING ACTIVITIES               1,968,958     (531,189)    10,188,535

 Net Increase (Decrease) in Cash        (4,895)      14,655             66

Cash - Beginning of Period               4,961        6,291                

 Cash - End of Periods              $       66    $  20,946      $      66


SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
 Interest paid during the nine months ended March 31, 1998 and 1997 was $0 and
$3,931 respectively, net of interest capitalized.  No income taxes were paid
during the nine months ended March 31, 1998 and 1997.

See Notes to Financial Statements

                                     8
<PAGE>

COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF CASH FLOW (UNAUDITED)


SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:


See Notes to Financial Statements

                                     9

<PAGE>

COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)


[1] Summary of Significant Accounting Policies

     Significant accounting policies of Country World Casinos, Inc. are set 
forth in the Company's Form 10-KSB for the period ended June 30, 1997, as 
filed with the Securities and Exchange Commission.

[2] Business of Reporting

     The accompanying unaudited financial statements have been prepared in 
accordance with generally accepted accounting principles for interim financial 
information and with the instructions to Form 10-QSB and Item 310(b) of 
Regulation S-B.  Accordingly, they do not include all the information and 
footnotes required by generally accepted accounting principles for complete 
financial statements.  In the opinion of management, such statements include 
all adjustments (consisting of normal recurring items) which are considered 
necessary for a fair presentation.  Operating results for the nine months 
ended March 31, 1998 and 1997 are not necessarily indicative of the results 
that may be expected for the year June 30, 1998.  It is suggested that these 
financial statements be read in conjunction with the financial statement and 
notes for the period ended June 30, 1997, included in the Country World 
Casinos, Inc. Form 10-KSB.


[3] Earnings Per Share

     Earnings per share are based on 13,488,243 and 6,694,097 shares 
outstanding for the nine months ended March 31, 1998 and 1997, respectively.  
Such amounts of shares represent the weighted average number of shares 
outstanding for the periods.  The effect of outstanding warrants and 
convertible preferred stock  were not included in the calculations.

                                     10
<PAGE>

COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION


CERTAIN STATEMENTS INCLUDED HEREIN OR INCORPORATED BY REFERENCE CONSTITUTE 
"FORWARD-LOOKING STATEMENTS" WITHIN THE MEANING OF THE PRIVATE SECURITIES 
LITIGATION REFORM ACT OF 1995 (THE "REFORM ACT").  THE COMPANY DESIRES TO TAKE 
ADVANTAGE OF CERTAIN "SAFE HARBOR" PROVISIONS OF THE REFORM ACT AND IS 
INCLUDING THIS SPECIAL NOTE TO ENABLE THE COMPANY TO DO SO.  FORWARD-LOOKING 
STATEMENTS INCLUDED OR INCORPORATED BY REFERENCE IN THIS PART INVOLVE KNOWN 
AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH WOULD CAUSE THE 
COMPANY'S ACTUAL RESULTS, PERFORMANCE (FINANCIAL OR OPERATING) OR ACHIEVEMENTS 
TO DIFFER MATERIALLY FROM THE FUTURE RESULTS, PERFORMANCE (FINANCIAL OR 
OPERATING) OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD LOOKING 
STATEMENTS.

     In order to begin the process of timely completing its goals the Company 
has contracted with Colorado Gaming Development Company, Inc., Semple Brown 
Roberts, P.C. and PCL Construction Services, Inc., all of Denver, Colorado to 
design and construct the planned casino and hotel complex.  In addition, the 
Company has signed a management agreement with Signature Hospitality 
Resources, Inc. of Denver, Colorado to manage its Radisson Black Hawk Hotel, a 
separate agreement to use the national flag of Radisson on the hotel and a 
management agreement with Luciani & Associates, LLC. of Atlantic City, New 
Jersey, to manage the casino operations.  All parties will assist the 
architect in design of their respective operations.  The agreement with 
Luciani & Associates, LLC has expired and they have advised the Company of 
such in writing in February 1998.  The Company is confident that once 
financing has been secured, it will be able to renegotiate a new agreement.

     The Company is engaged in the design, development and construction of the 
Radisson Hotel and Country World Casino (the "Hotel Casino") in Black Hawk, 
Colorado.  The planned Hotel Casino will be a seven story complex, featuring 
five stories of hotel rooms above a two-story, 75,000 square foot casino, and 
an underground parking garage.  Other amenities will include one or more full 
service restaurants, a buffet, entertainment lounge and retail shops.  When 
completed as planned, the Hotel Casino will be largest hotel and casino 
complex in Colorado.  Construction and opening of the Hotel Casino is 
dependent upon the Company's ability to successfully raise the required 
capital.  The Company is seeking $79,500,000 of debt or equity financing.  
There can be no assurance, however, that the Company will be successful in 
raising such financing or that the proceeds of such financing will be 
sufficient to complete construction and provide working capital for the 
opening and operation of the Hotel Casino.

     The casino level of the project, at approximately 75,000 square feet, 
will be the largest in Colorado and will be capable of accommodating 1,800 
slot machines and 32 gaming tables.  The Company intends to open the facility 
with approximately 1,000 slot machines, 20 blackjack tables and 12 poker 
tables,

                                     11

<PAGE>

COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

and may add up to 800 additional slot machines if management determines that 
the additional gaming devices will produce equal per square foot revenue and 
will not create excess capacity.  The Company expects that slot machines will 
be the greatest source of its gaming revenues.  Slot machines are less labor 
intensive and require less square footage than table games, while generating 
higher profit margins. 

     Based on the present design, the Country World Casino's atmosphere will 
feature a country western music theme similar to the rock and roll music theme 
successfully employed by the Hard Rock Cafe.  The Casino decor will include 
memorabilia from the great country singers, both past and present, with a star 
walk of their own.  The country western music theme has not been established 
in the Black Hawk/Central City, Colorado gaming market, and therefore will 
give the Country World Casino its own unique identity.  Management believes 
that as casinos have become more numerous, the gaming industry has begun to 
recognize that popular themes and amenities such as quality dining and hotel 
accommodations play an important role in attracting customers to casinos.  The 
theme is intended to appeal to the Hotel Casino's target customer base, which 
consists primarily of residents of the Denver metropolitan area as well as 
other Colorado communities located within driving distance of Black Hawk.

     The Radisson Black Hawk Hotel will provide overnight accommodations with 
290 standard rooms and 35 suites, making it the first destination resort of 
its kind in Black Hawk.  Complimenting both the casino and hotel will be a 
three story 865 car underground parking facility featuring both valet and self 
parking options, and the only covered on-site bus turnaround in Black Hawk for 
the convenience of day trip customers.

     Black Hawk is a picturesque mountain town approximately 40 miles west of 
Denver.  In the past year, Black Hawk hosted approximately 3 million visitors 
and generated almost 60% of the state's gaming revenues.  The 112,000 square 
foot Hotel Casino site on the northern most end of the Black Hawk gaming 
district is in a most highly visible location as it is in a direct line of 
site to all visitors approaching Black Hawk's main intersection on State 
Highway 119.  The seven story structure will tower high above all existing 
facilities.  The Black Hawk and nearby Central City casino market includes 
many small, privately held gaming facilities that the Company believes offer 
limited amenities and are characterized by a shortage of convenient on-site 
parking.  There are a few large facilities currently operating with varying 
levels of services and amenities, as well as new facilities planned.  The 
Country World Casino's country western music theme, country hospitality, ample 
parking, modern hotel accommodations and a full line of amenities, will set it 
apart from, and should give it a competitive advantage over, the other casinos 
in the Black Hawk/Central City market.

     The Hotel Casino complex will be designed and constructed pursuant to a 
guaranteed maximum price agreement which will be finalized prior to 
construction.  The design and construction team consists of Semple Brown 
Roberts, P.C., a Denver based architectural firm (the "Architect") and PCL 
Construction Services, Inc., a multi-billion dollar North American

                                     12
<PAGE>

COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

construction firm with U.S. headquarters located in Denver.  The Architect is
the designer of Fitzgerald's Casino in Black Hawk, while the Contractor's
gaming credits include the MGM Grand Hotel Casino and Stratosphere Tower in
Las Vegas, Nevada, as well as the Chinook Winds Gaming and Convention Center
in Lincoln City, Oregon.

     The Company has incurred substantial net losses to date.  Insofar as the 
Company has not completed its casino facility, it has received no revenues 
from operations from these planned business activities.  The Company's 
financial statements have been presented on the basis that it is a going 
concern, which contemplates the realization of assets and the satisfaction of 
liabilities in the normal course of business.  The Company's ability to 
continue in existence is dependent upon its ability to obtain additional 
long-term financing and achieve profitable operations.  The financial 
statements do not include any adjustments relating to the recoverability and 
classification of recorded asset or liability amounts which might be necessary 
should the Company be unable to continue in existence.

     During the nine months ended March 31, 1998, the Company had general and 
administrative expenses of $818,605, depreciation expense of $4,743, interest 
expense of $92,267 and legal fees incurred for its bankruptcy proceedings of 
$23,083.  The Company remains in the development stage and has incurred a loss 
from inception thorough March 31, 1998 of $5,263,866.

      In May 1997, the Company issued a promissory note and second deed of 
trust on the property to Norlar, Inc. for a maximum of $600,000, or so much 
thereof as may have been advanced by maker, for general corporate purposes.  
As of September 1997, the Company owed approximately $600,000 on the Norlar 
Note.  In October 1997, the Company issued a second promissory note and a 
fourth deed of trust on the property to Norlar, Inc., again for a maximum of 
$600,000.  As of March 31, 1998, the Company owed approximately $555,000 on 
the Norlar Note.  In addition, for each $100,000 Norlar, Inc. has loaned to 
the Company, it has authorized the issuance of 500,000 warrants to purchase 
shares of common stock at $0.20 per share.  Norlar, Inc. is a closely-held 
corporation beneficially owned by Larry Berman and his wife.  Mr. Berman is 
Chairman and Chief Executive Officer of the Company. The loans bear interest 
at 12% per annum and is to be repaid upon the earlier of the sale of the 
property, the contemplated refinance of the property or the financing of the 
project.

     In addition to obtaining the necessary financing, the Company must obtain 
from the Colorado Gaming Commission approval to commence gaming operations.  
The Commission's action is predicated upon approval of the applications of all 
of the Company's principals.  The Company is taking the steps necessary to go 
forward with its submission to state authorities of its gaming application in 
1998 and receive the required approvals to engage in gaming operations within 
the State of Colorado. However, there can be no assurance that the Company 
will be successful in its efforts. Management believes that the length of time 
and disposition of the gaming approval process cannot be accurately predicted 
at this point, but that the process could be time consuming and expensive.

     In September 1997, the Company issued 395,000 shares of common stock to 
Sommer & Schneider LLP, its securities attorneys, for payment of legal fees 
and a six month retainer.

     In March 1998, the Company issued 850,000 shares for the same purpose as 
described above.

                                     13
<PAGE>

COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

PART II. OTHER INFORMATION


Item 1 - Legal Proceedings

     The Company is the plaintiff and a counterclaim defendant in a lawsuit 
pending in Denver, Colorado District Court, Case No. 95CV2310, entitled 
Country World Casinos, Inc., a Nevada corporation, Plaintiff, v. Tommyknocker 
Casino Corp., a Colorado corporation and New Allied Development Corporation, a 
Colorado corporation, Defendants, v. Country World Casinos, Inc., a Nevada 
Corporation, Holly Products, Inc., a New Jersey corporation, Ronald G. Nathan, 
Sal Lauria,  Roger D. Leclerc, William H. Patrowicz and David Singer, 
counterclaim Defendants.  This lawsuit was commenced by the Company on May 26, 
1995.

     The pending lawsuit between the Company and New Allied and TKCC was 
stayed upon the filing of the Company's bankruptcy petition in October 1995.  
That stay was lifted when the bankruptcy case was dismissed in March 1997, and 
the Company is now moving forward with these proceedings.  In addition, the 
Company has filed an appeal of the Bankruptcy Court's ruling.  New Allied has 
crossed appealed.  Such appeals are pending.

     The Company is seeking a court order requiring TKCC and New Allied to 
sell to the Company their 2.5 million shares of voting stock in the Company at 
the price set forth in ss.47.1-4.508 Rule 4.5 of the Colorado Gaming 
Regulations on the basis that New Allied and TKCC might possibly be unsuitable 
to hold voting securities in a licensed casino.  As part of the consideration 
given by the Company to TKCC to purchase the Black Hawk property, the Company 
issued to TKCC 2,250,000 shares of non-voting preferred stock in the Company.  
That preferred stock was subsequently given voting rights.  In a subsequent 
real estate purchase transaction, the Company issued to New Allied 250,000 
share of common stock.

     TKCC and New Allied have filed an answer to some of the Company's claims, 
denying liability.  In addition, TKCC and New Allied have filed counterclaims 
against the Company, as well as against Holly Products, Inc. ("Holly"), the 
majority shareholder in the Company, Ronald G. Nathan ("Nathan"), Sal Lauria 
("Lauria"), and David Singer ("Singer") former directors of the Company, and 
Roger G. Leclerc ("Leclerc") and William H. Patrowicz ("Patrowicz"), who are 
currently officers and directors of the Company.  TKCC alleges that the 
Company has breached an agreement to file a registration statement for the 
preferred stock given to TKCC as part of the consideration for purchase of the 
Black Hawk property.  The Company has filed an answer denying liability on 
this counterclaim.  The Federal Bankruptcy Court ruled that the Company was 
not in breach of its agreement.

     TKCC and New Allied have asserted that the Company, as well as Holly, 
Nathan, Lauria, Leclerc, Patrowicz and Singer, breached their fiduciary duties 
by the issuance of five million shares of common stock in the Company to 
Holly.  TKCC and New Allied seek actual and exemplary damages allegedly caused 
by said alleged wrongful issuance of stock.  TKCC and New Allied seek an 
injunction requiring the Company and it board of directors to cancel the five 
million shares of stock issued to Holly.

     The Company, as well as Leclerc, Holly, Patrowicz and Singer, have filed 
answers denying any wrongful conduct or any liability to TKCC or New Allied 

                                     14
<PAGE>


resulting from said issuance of stock to Holly and have affirmatively asserted 
that said issuance of stock was proper.  Neither Nathan nor Lauria has been 
served with the summons and counterclaim and have not yet appeared in this 
lawsuit.

     The Company is a co-defendant in a lawsuit pending in Travis County, 
Texas District Court, Cause No. 95-04782, 200th Judicial District, entitled 
James Hamilton, Plaintiff v. Robert Todd Financial Corporation; Defendant.  
The Plaintiff James Hamilton contends that Defendant Robert Todd Financial 
Corporation, and its agents and/or employees, made misrepresentations 
regarding the Company's stock, which allegedly induced Hamilton's purchase of 
said stock.  Hamilton alleges that the Company is liable for the alleged 
wrongful conduct of said Defendants.  The Company has filed a Special 
Appearance and Answer, objecting to the jurisdiction of the Travis County, 
Texas District Court, as well as denying all material allegations of 
Hamilton's Original Petition.  No action has been taken in this case since 
1996 and exposure to the company is minimal as the claim is for approximately 
$25,000.00.

                                     15
<PAGE>

COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

PART II. OTHER INFORMATION


ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

     None

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

     None

                                     16
<PAGE>

COUNTRY WORLD CASINOS, INC.
(A DEVELOPMENT STAGE COMPANY)

SIGNATURES


          In accordance with the requirements of Sections 13 or 15(d) of the 
Securities Exchange Act of 1934, as amended, the Registrant has caused this 
Report to be signed on its behalf by the undersigned, thereunto duly 
authorized.


                    COUNTRY WORLD CASINOS, INC.


                    
                      By:__/s/_William_H._Patrowicz_________________
                               William H. Patrowicz, Secretary & Treasurer



Date: May 14, 1998



                                     17
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