UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-QSB



(Mark One)

[ X ]  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934
       For the quarterly period ended November 30, 1998.

[   ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
       For the transition period from ____________ to _______________

Commission file number 0-12551

CREATIVE COMPUTER APPLICATIONS, INC.
(Exact name of small business issuer as specified in its charter)

California                               95-3353465
(State or other jurisdiction of       (I.R.S. Employer
incorporation or organization)       Identification No.)

26115-A Mureau Road, Calabasas, California 91302
(Address of principal executive offices)

(818) 880-6700
Issuer's telephone number:


      Check whether the Issuer (1) filed all reports required to 
be filed by Section 13 or 15(d) of the Exchange Act during the past 
12 months (or for such shorter period that the Registrant was 
required to file such reports), and (2) has been subject to such 
filing requirements for the past 90 days.

          Yes  X                 No       


State the number of shares outstanding of each of the 
issuer's classes of common equity, as of the latest practicable 
date:  2,920,740 common shares as of December 31, 1998.


      Transitional Small Business Disclosure Format (check one):

          Yes                    No  X 




FORM 10-QSB


I N D E X



PART I - Financial Information:                             PAGE

Condensed Balance Sheets, as at November 30,
1998 and August 31, 1998                                      3

Condensed Statements of Income for the three
months ended November 30, 1998 and November
30, 1997                                                      4

Condensed Statements of Cash Flows for the 
three months ended November 30, 1998 and
November 30, 1997                                             5

Notes to Condensed Financial Statements                       6

Management's Discussion and Analysis or Plan
of Operation                                                  6


PART II - Other Information:

Items 1 through 6                                             9

Signatures                                                    9


PART 1 - FINANCIAL INFORMATION

CONDENSED BALANCE SHEETS

<TABLE>
<CAPTION>
                                               November 30,    August 31,
                                                   1998          1998 *
                                               (Unaudited)
                    ASSETS
<S>                                                 <C>            <C>
CURRENT ASSETS:
   Cash                                         $   433,969   $   375,876
   Receivables                                    2,010,714     1,973,601
   Inventories                                      607,925       670,243
   Prepaid expenses and other assets                128,662        79,907
   Deferred tax asset                               466,300       466,300

             TOTAL CURRENT ASSETS                 3,647,570     3,565,927

PROPERTY AND EQUIPMENT, net                         544,234       575,804
INVENTORY OF COMPONENT PARTS                        146,027       156,527
CAPITALIZED SOFTWARE COSTS, net of
    accumulated amortization of
    $450,912 and $384,509                         1,200,595     1,128,498
INTANGIBLES, net                                    251,986       302,120
OTHER ASSETS                                         23,100        32,371
DEFERRED TAX ASSET                                  844,200       844,200

                TOTAL ASSETS                    $ 6,657,712   $ 6,605,447

   LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
   Notes payable to bank                        $   581,609   $   611,609
   Accounts payable                                 462,786       507,005
   Accrued liabilities:
        Vacation Pay                                203,889       184,305
        Other                                       372,035       339,402
   Deferred service contract income                 718,677       754,343
   Deferred revenue                                 706,314       638,018
   Capital lease obligations,
       current portion                                3,173         4,679

        TOTAL CURRENT LIABILITIES                 3,048,483     3,039,361

           TOTAL LIABILITIES                      3,048,483     3,039,361

SHAREHOLDERS' EQUITY:
   Preferred shares, no par value;
     500,000 shares authorized; no
     shares outstanding                                   -             -
   Common shares, no par value;
     20,000,000 shares authorized;
     2,920,740 and 2,920,740 shares
     outstanding                                  5,831,027     5,831,027
   Accumulated deficit                           (2,221,798)   (2,264,941)

       TOTAL SHAREHOLDERS' EQUITY                 3,609,229     3,566,086


                                                $ 6,657,712   $ 6,605,447
</TABLE>

See Notes to Financial Statements.


* As presented in the audited financial statements


CONDENSED STATEMENTS OF OPERATION

<TABLE>
<CAPTION>
                                                    Three Months Ended
                                                       November 30,

                                                   1998           1997
                                                       (unaudited)
<S>                                                 <C>           <C>
NET SYSTEM SALES AND SERVICE REVENUE
        System sales                            $ 1,207,606   $ 1,244,737
        Service revenue                             670,683       562,704
                                                  1,878,289     1,807,441

COST OF PRODUCTS AND SERVICES SOLD
        System sales                                746,204       624,861
        Service revenue                             357,444       393,406
                                                  1,103,648     1,018,267

        Gross profit                                774,641       789,174

OPERATING EXPENSES:
        Selling, general and administrative         570,936       589,371

        Research and development                    145,753       155,543

                                                    716,689       744,914

        Operating income                             57,952        44,260

INTEREST AND OTHER INCOME                               578           574

INTEREST EXPENSE                                    (15,188)       (3,998)

        Income before taxes on income                43,342        40,836

TAXES ON INCOME                                        (200)         (350)

NET INCOME                                      $    43,142   $    40,486

EARNINGS PER COMMON SHARE (Note 2):
        Basic                                   $       .01   $       .01
        Diluted                                 $       .01   $       .01

WEIGHTED AVERAGE NUMBER OF COMMON
	SHARES AND COMMON STOCK 
	EQUIVALENTS OUTSTANDING

        Basic                                     2,920,740     2,859,865
        Diluted                                   2,920,740     3,010,231
</TABLE>                       



See Notes to Financial Statements. 


CONDENSED STATEMENTS OF CASH FLOWS

Increase (Decrease) in Cash

<TABLE>
<CAPTION>
                                                    Three Months Ended
                                                       November 30,

                                                    1998          1997
                                                       (unaudited)

<C>                                                 <C>           <C>
OPERATING ACTIVITIES:
   Net income                                   $    43,142   $    40,486
   Adjustments to reconcile net income
      to net cash provided by operating
        activities:
         Depreciation and amortization              139,264       111,176
         Provision for possible losses                 (881)        1,650
   Changes in operating assets and
		liabilities:
         Receivables                                (36,232)     (191,761)
         Inventories                                 62,318       (48,502)
         Prepaid expenses and other assets          (48,755)      (43,388)
         Accounts payable                           (44,219)       52,488
         Accrued liabilities                         84,847       100,975

         Net cash provided by
         operating activities                       199,484        23,124

INVESTING ACTIVITIES 
        Additions to property and equipment         (13,885)      (38,788)
        Capitalized software costs                  (96,000)     (106,000)
		Net cash used in investing
                     activities                    (109,885)     (144,788)

FINANCING ACTIVITIES:
   Additions to (payments on) notes payable, net    (30,000)     (130,000)
   Decrease in capital lease obligations,
       net of payments                               (1,506)       (5,948)
     Exercise of Stock Option                             0        15,950
     Net cash used in financing activities          (31,506)     (119,998)

NET INCREASE (DECREASE) IN CASH                      58,093      (241,662)

Cash, beginning of period                           375,876       534,430

Cash, end of period                             $   433,969   $   292,768

</TABLE>



See notes to financial statements.


NOTES TO CONDENSED FINANCIAL STATEMENTS

Note 1.	In the opinion of management, the accompanying 
        unaudited condensed financial statements reflect 
        all adjustments (which include only normal 
        recurring accruals) necessary to present fairly the 
        Company's financial position as of November 30, 
        1998 and August 31, 1998, the results of its 
        operations for the three months ended November 30, 
        1998 and 1997, and cash flows for the three months 
        ended November 30, 1998 and November 30, 1997.

Note 2. The Company adopted SFAS No. 128, "Earnings Per 
        Share,".  SFAS No. 128 requires presentation of 
        basic and diluted earnings per share.  Basic 
        earnings per share is computed by dividing income 
        or loss available to common shareholders by the 
        weighted average number of common shares 
        outstanding for the reporting period.  Diluted 
        earnings per share reflects the potential dilution 
        that could occur if securities or other contracts, 
        such as stock options, to issue common stock were 
        exercised or converted into common stock.  All 
        prior period weighted average and per share 
        information have been restated in accordance with 
        SFAS No. 128.

Note 3.	The Company elected early adoption of Statement of 
        Position 97-2, "Software Revenue Recognition", 
        ("SOP 97-2").  SOP 97-2 supersedes SOP 91-1 
        regarding software revenue recognition.  SOP 97-2 
        required the Company to change the method of 
        recognizing revenues on software sales and related 
        services, in accordance with SOP 97-2.  The SOP 
        requires companies to recognize revenue when (i) 
        persuasive evidence of an arrangement exists, (ii) 
        delivery has occurred, (iii) the vendor's fee is 
        fixed and determinable, and (iv) collectability is 
        probable.  The SOP also requires companies to 
        allocate the fee on a multiple element contract 
        between the various elements based on vendor-
        specific objective evidence of fair value.


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

        This following section of the report contains forward-
        looking statements within the meaning of the Private Securities 
        Litigation Reform Act of 1995.  Such forward-looking statements 
        involve risks and uncertainties so that the actual results may
        vary materially.


Results of Operations

        In October 1997 the American Institute of Certified Public 
Accountants issued Statement of Position (SOP) 97-2, Software 
Revenue Recognition, which became effective for fiscal years 
beginning after December 15, 1997 although earlier adoption was 
recommended.  The new SOP affects all companies that sell software 
and provide related services.  Its provisions necessitate 
significant modifications in the way the Company structures software 
transactions and reports revenues from those activities.  Because 
SOP 97-2 significantly changes the way in which the Company accounts 
for the sale of its Clinical Information Systems, management decided 
to adopt the change in accounting method during the second quarter 
of 1998 instead of waiting until the beginning of its next fiscal 
year.

        SOP 97-2 requires that the Company modify its revenue 
recognition policies on a going forward basis and no restatement of 
prior periods is required.  Accordingly the following discussion 
takes into consideration the effect of SOP 97-2 for the current 
periods only and therefore the comparisons are not fully 
representative  The change in accounting method brought about by SOP 
97-2 primarily affects reporting of revenues from the sale of the 
Company's CIS products and related data acquisition products bundled 
into CIS transactions.  All other components of the Company's 
business from which it derives revenues were already compliant with 
the provisions of SOP 97-2.  Under the SOP 97-2 guidelines revenues 
from the sale of the Company's CIS products will be recognized as 
hardware and standard software is delivered to a customer, custom 
software such as interfaces to other vendors systems will be 
recognized when delivered and operational, and revenues associated 
with the  installation and implementation of systems will be 
recognized as the services are performed.  Other provisions of the 
SOP that require, among other things, a defined contract and 
definitive sales price have been met by the Company's internal sales 
policies that were already in place for many years.

        Sales for the first quarter of fiscal 1999 ended November 
30, 1998 increased by $70,848 or 4% compared to the same quarter of 
fiscal 1998.  When analyzed by product category, sales of Clinical 
Information Systems (CIS) decreased $92,322 or 9%, sales of data 
acquisition products increased $52,021 or 23% and service and other 
revenues increased $111,149 or 19%.  The overall increase in sales 
is primarily attributable to an increase in sales of data 
acquisition products and an increase in service revenues due to a 
greater number of customer sites on contract.  The increases were 
offset by a decrease in sales of Clinical Information Systems.  This 
decrease was attributable to the change in accounting for revenue 
recognition in accordance with SOP 97-2.

        Cost of sales for the first quarter of 1999 increased by 
$85,381 or 8% as compared to the same quarter of 1998.  The increase 
in cost of sales was primarily attributable to an increase in 
material costs of $104,463 or 48% which was attributable to a 
greater volume of hardware components sold during the quarter and to 
a lesser amount of software revenues that were recognized in the 
quarter.  There was an increase in other costs of $4,176 or 1%.  
These increases were partially offset by a decrease in labor costs 
of $23,258 or 5%.  Cost of sales as a percentage of sales was 59% 
for the current quarter as compared to 56% to the comparable fiscal 
1998 quarter.  This was due in part to the recognition of hardware 
revenue and the deferral of software revenue in accordance with the 
adoption of SOP-97-2.

        Selling and administration expenses decreased $18,435 or 
about 3% for the current quarter compared to the same quarter of 
1998.  The decrease was primarily attributable to a reduction in 
sales taxes and other expenses during the quarter.  Management 
anticipates increasing the level of sales and marketing expenditures 
in future quarters as the Company expands its sales and marketing 
activities related to the sale of its CIS products across a broader 
market spectrum.

        The Company has been engaged in strategic joint marketing 
partnerships with other companies which has improved the Company's 
market penetration.  Management views the near term outlook for the 
continued sale of CIS products favorably during the first half of 
the 1999 fiscal year.  However, the Company's future operating 
results will continue to be subject to quarterly variations based 
upon a wide variety of factors, including the volume mix and timing 
of orders received during any quarter or annual periods.

        Research and Development expense decreased $9,790 or about 
6% for the current quarter as compared to the same quarter of 1998.  
The decrease is attributable to a change in personnel.  The Company 
continues to expend considerable resources on new product 
development and product enhancements which should continue for the 
foreseeable future.  In addition, the Company has also initiated the 
design phase of new CIS products that will require increased 
development expenditures in future periods.

        As a result of the aggregate factors discussed above the 
Company earned net income of $43,142 or basic and diluted net income 
per share of $.01 for the first fiscal quarter ended November 30, 
1998 compared to $40,486 or basic and diluted net income per share 
of $.01 per share for the same quarter a year ago.


Capital Resources and Liquidity

        As of November 30, 1998, the Company's working capital 
amounted to $599,087 compared to $526,566 at August 31, 1998.  The 
ratio of the Company's current assets to current liabilities was 
approximately 1.2 to 1 at November 30, 1998 compared to 1.2 to 1 at 
August 31, 1998.

        The Company's Balance Sheet has been affected by the 
inclusion of deferred revenues as a current liability which affects 
working capital ratios.

        The Company's bank line of credit as of November 30, 1998 
amounted to approximately $800,000, of that amount $581,600 was 
outstanding as of that date.  The Company's bank line contains 
certain financial ratio requirements.  The Company was not in 
compliance with some of the covenants and financial ratios required 
by its bank as of November 30, 1998, but had obtained a waiver from 
its bank.

        The Company believes that its cash flow from operations 
together with its bank credit facilities should be sufficient to 
fund its working capital requirements for its 1999 fiscal year.


Seasonality, Inflation and Industry Trends

        The Company sales are generally lower in the summer and 
higher in the fall and winter.  Inflation has had no material effect 
on the Company business since the Company has been able to adjust 
the prices of its products and services.  Management  believes that 
most phases of the healthcare segment of the computer systems 
industry will continue to be competitive and that the changes making 
place in healthcare will have a long term positive impact on its 
business.  In addition, management believes that the industry will 
experience more significant technological advances which will 
improve the quality of service and reduce costs.  The Company is 
poised to meet these challenges by continuing to employ new 
technologies when they become available, diversifying its product 
offerings, and by constantly enhancing its software applications.


Year 2000 Compliance

        Many currently installed computer systems and software products
are coded to accept only two digit entries in the date code field.  As 
the year 2000 approaches, these code fields will need to accept four 
digit entries to distinguish years beginning with "19" from those 
beginning with "20".  As a result some computer systems and software 
used by the Company and its clients may have to be upgraded to 
comply with such Year 2000 requirements.  The Company is currently 
expending resources to review its products, systems and services and 
the computer systems and software products it sells in order to 
identify and modify those products, systems and services.  The 
Company believes that the cost of the modifications associated with 
this effort will not have a material adverse effect on the Company's 
operating results.  However, achieving Year 2000 compliance is 
dependent on many factors, some of which are not completely within 
the Company's control, including without limitation, the 
availability and cost of trained personnel and effectiveness of 
software upgrades used by the Company and its vendors and suppliers.  
Should either the Company's internal systems or the internal systems 
of one or more significant vendors or suppliers fail to achieve Year 
2000 compliance, the Company's business and its results of 
operations could be adversely affected.


Clinical Information Systems

	The Company has been engaged in evaluating and modifying its CIS 
products for sometime and has completed core modifications and 
testing for Year 2000 changes to CyberLAB II(Registered Trademark).  
The Company is currently distributing the Year 2000 compliant 
software upgrades to its clients.  CyberRAD(Registered Trademark) 
and MQA were designed to be Year 2000 compliant.  
CyberMED(Trademark) is currently being modified and it is expected 
that the modifications and testing will be completed by mid 1999.  
Subsequently the modified CyberMED(Trademark) upgrade will be 
distributed to clients.  Modifications are also currently being made 
to the financial management system that will be completed by March 
1999 and released thereafter.  The Company is also evaluating 
communication interfaces it has installed in order to determine in 
each individual case, whether the software is Year 2000 compliant, 
and will undertake such modifications as are deemed to be necessary 
to be compliant.  The Company believes it is timely and on schedule 
in its efforts to effectuate the modifications, testing and upgrade 
of its developed software applications to its clients.  Management 
is cognizant of the fact that the timeliness of the completion and 
distribution of Year 2000 modifications are critical to the success 
of the Company.

        Some of the Company's clients may require upgrades to their 
computers and/or operating systems, in order to operate the upgraded 
application software and otherwise be Year 2000 compliant.  The 
Company has been conducting a review of its client installations in 
order to determine their status and to advise clients as to what 
modifications should be undertaken.  The Company's extended service 
agreements require that the client be responsible for the cost of 
any upgrades to their computers that may be required to operate 
upgraded or modified application software.  Therefore the Company 
does not expect to bear the costs associated with this effort and 
instead will derive revenues from the upgrades.  The Company had 
identified the modifications and/or upgrades required by the vendors 
and is assisting its clients in securing the necessary modifications 
and/or upgrades.  The Company has sent a Year 2000 technical 
document to all it's clients, and posted the information on its web 
site to assist its clients in their evaluations.


In House Systems and Computers

	The Company continues to conduct a review of the computers, 
systems and software that it utilizes internally to operate its 
business.  It has determined that some systems such as its 
accounting and voice mail systems will have to be replaced since 
they are not modifiable.  However, such systems were already due to 
be replaced because they are no longer adequate and are not being 
supported by their manufacturers.  Other systems supported by their 
manufacturers will be upgraded in the normal course with Year 2000 
modifications on a timely basis.  Although the Company will have to 
bear the cost of replacing non-compliant systems, it is not 
anticipated that the aggregate expenditures will be of a material 
nature.  At present, the cost of such replacements has not been 
fully determined.


PART II - OTHER INFORMATION


Items 1 through 5.  NOT APPLICABLE 

Item 6.	Exhibits and Reports on Forms 8-K

(a)     Exhibit 11 - Statement re: computation of per share 
        earnings.

        Exhibit 27 - Financial Data Schedule.

(b)	There were no reports filed on Form 8-K during the quarter 
        ended November 30, 1998.


SIGNATURES

In accordance with the requirements of the Exchange Act, the Company 
caused this report to be signed on its behalf by the undersigned, 
thereunto duly authorized.


CREATIVE COMPUTER APPLICATIONS, INC.
(Company)



Date  January 11, 1999		/S/ Steven M. Besbeck					
                                Steven. M. Besbeck, President
                                Chief Executive Officer, Chief
                                Financial Officer




Date  January 11, 1999		/S/ Carol Bessel						
                                Carol Bessel, Controller and Chief 
                                Accounting Officer


Exhibit 11

CREATIVE COMPUTER APPLICATIONS, INC.

COMPUTATION OF EARNINGS PER COMMON SHARE



<TABLE>
<CAPTION>

                                                   Three Months Ended
                                                      November 30,

                                                    1998          1997   

<S>                                                 <C>          <C>
AVERAGE MARKET PRICE PER SHARE                  $       .82   $      1.74

NET INCOME                                      $    43,142   $    40,486

Basic weighted average
   number of common
        shares outstanding                        2,920,740     2,859,865
Diluted effect of stock options                           -       150,366

Diluted weighted average number of common
        shares outstanding                        2,920,740     3,010,231

Basic earnings per share                        $       .01   $       .01

Diluted earnings per share                      $       .01   $       .01
</TABLE>