Form 10-QSB

                     SECURITIES AND EXCHANGE COMMISSION
                               Washington D.C.


(X)            Quarterly Report Pursuant to Section 13 or 15(d) of 
                      the Securities Exchange Act of 1934
	
	

For the Quarterly Period Ended March 31, 1998     Commission File No. 0-26884


                     NETTER DIGITAL ENTERTAINMENT, INC.
            (exact name of registrant as specified in charter)

      	Delaware                                                     95-3392054
   (State or other                                              (I.R.S. Employer
 jurisdiction of incorporation)                              Identification No.)


                           5125 Lankershim Blvd.
                    North Hollywood, California  91601
                  (Address of principal executive office)

          Registrant's telephone number, including area code: 818/753-1990


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 ___


As of May 14, 1998 the Registrant had 3,334,405 shares of its Common Stock,
$.01 par value, issued and outstanding.








               NETTER DIGITAL ENTERTAINMENT, INC. AND SUBSIDIARIES
                                  FORM 10-Q
                                March 31, 1998
                                    INDEX


PART I.	FINANCIAL INFORMATION
                                                                       	PAGE
Item 1.	Financial Statements (Unaudited)	                              NUMBER
                                                                       ------

        Consolidated Balance Sheet as of March 31, 1998                   3

        Consolidated Statement of Operations for the three-month 
        and nine-month periods ended March 31, 1998 and 
        March 31, 1997.                                                   4

        Consolidated Statements of Cash Flows for the nine-month 
        periods ended March 31, 1998 and March 31, 1997.	                 5

        Notes to Consolidated Financial Statements	                     6-7


Item 2.	Management's Discussion and Analysis of Financial Condition 
         and Results of Operations                                    	7-11

PART II.	OTHER INFORMATION

Item 6.	Exhibits and Reports on Form 8-K	                                11

Signatures		                                                             12










                              Page 2 of 12

PART I.  FINANCIAL INFORMATION
Item 1.  Financial Statements

               NETTER DIGITAL ENTERTAINMENT, INC. AND SUBSIDIARIES
                         CONSOLIDATED BALANCE SHEET


                                                                     March 31,
                                                                       1998
                                                                   ------------
                                                                    (Unaudited)
                                   ASSETS
                                   ------
CURRENT ASSETS:
  Cash and cash equivalents                                      $    1,025,207 
  Accounts receivable, net of allowances of $22,434                   2,020,080 
  Due from officer                                                      155,897 
  Inventory                                                           1,488,883 
  Production costs, net                                                 265,768 
  Other                                                                 156,679 
                                                                  --------------
      TOTAL CURRENT ASSETS                                            5,112,514 

EQUIPMENT,  net                                                       2,019,993

GOODWILL, net                                                         1,964,512

DEPOSITS AND OTHER ASSETS                                               280,460
                                                                  --------------
                                                                 $    9,377,479 
                                                                  ==============

                       LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
  Accounts payable and production fee advances                   $    2,470,314
  Accrued expenses                                                      287,635 
  Deferred revenue                                                      255,234 
  Short term notes payable                                              395,103 
  Current portion of long-term debt                                      95,427 
  Current portion of capital lease obligations                          268,397 
                                                                  --------------
        TOTAL CURRENT LIABILITIES                                     3,772,110 

CAPITAL LEASE OBLIGATIONS                                               434,557

MINORITY INTEREST                                                           500 
                                                                  --------------

STOCKHOLDERS' EQUITY :
  Preferred stock, $.001 par value, 2,000,000 shares
    authorized; 51,859 shares issued and outstanding                    304,366
  Common stock, $.01 par value, 20,000,000 shares
    authorized; 3,334,405 shares issued and outstanding                  33,344
  Additional paid-in capital                                          4,726,171 
  Retained Earnings                                                     106,431 
                                                                  --------------
          TOTAL STOCKHOLDERS EQUITY                                   5,170,312 
                                                                  --------------
                                                                 $    9,377,479 
                                                                  ==============

The accompanying notes are an integral part of the consolidated financial 
                               statements.

                              Page 3 of 12

              NETTER DIGITAL ENTERTAINMENT, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>


                                          Three Months Ended Mar. 31,     Nine Months Ended Mar. 31,
                                          ---------------------------     --------------------------
                                              1998          1997               1998        1997
                                          ---------------------------     ---------------------------
                                           (Unaudited)   (Unaudited)       (Unaudited)   (Unaudited)
<S>                                       <C>            <C>             <C>            <C>

REVENUES:
   Production                             $  6,710,319   $  6,458,340    $ 20,226,700   $ 15,879,952
   Sales                                     1,180,921      1,190,030       3,073,760      1,190,030
                                           ------------   ------------    ------------   -----------
      TOTAL REVENUES                         7,891,240      7,648,370      23,300,460     17,069,982
                                           ------------   ------------    ------------   -----------
EXPENSES:
   Production                                6,035,065      5,910,107      18,089,315     14,399,458
   Cost of goods sold                          590,514        362,780       1,519,365        362,780
   General and administrative                1,115,451      1,243,428       3,359,437      2,275,051
   Amortization of goodwill                     26,077         17,251          78,233         17,251
                                           ------------   ------------    ------------   -----------
        TOTAL EXPENSES                       7,767,107      7,533,566      23,046,350     17,054,540
                                           ------------   ------------    ------------   -----------

OPERATING INCOME (LOSS)                        124,133        114,804         254,110         15,442
                                           ------------   ------------    ------------   -----------

OTHER INCOME (EXPENSE):
   Interest income                               3,559         14,209          18,049         71,271
   Interest (expense)                          (44,589)       (38,641)       (137,538)       (38,641)
   Other income/(expense)                        3,728          4,133          12,481          4,301 
                                           ------------   ------------    ------------   -----------
        TOTAL OTHER INCOME (EXPENSE)           (37,302)       (20,299)       (107,008)        36,931 
                                           ------------   ------------    ------------   -----------

INCOME BEFORE PROVISION FOR
  INCOME TAXES                                  86,831         94,505         147,102         52,373

PROVISION FOR INCOME TAXES                       7,500              -          38,000              - 
                                           ------------   ------------    ------------   -----------

NET INCOME (LOSS)                         $     79,331   $     94,505    $    109,102   $     52,373
                                           ============   ============    ============   ============

Cumulative preferred stock dividend             10,745          7,072          31,964          7,072 

Net Income to common shareholders         $     68,586   $     87,433    $     77,138   $     45,301
                                           ============   ============    ============   ============

Net Income (Loss) per common share,
     basic and assuming dilution          $       0.02   $       0.03    $       0.02   $       0.02  
                                           ============   ============    ============   ============

Weighted average common shares outstanding   3,337,110      2,969,074       3,334,601      2,969,074 
                                           ============   ============    ============   ============
<FN>
<FN1>

The accompanying notes are an integral part of the consolidated financial 
                               statements.
</FN>
</TABLE>
                              Page 4 of 12

                  NETTER DIGITAL ENTERTAINMENT, INC. AND SUBSIDIARIES 
                        CONSOLIDATED STATEMENTS OF CASH FLOWS 
<TABLE>
<CAPTION>

                                                            Nine Months Ended March 31,
                                                          --------------------------------
                                                                  1998           1997
                                                          --------------------------------
                                                             (Unaudited)     (Unaudited) 
<S>                                                        <C>             <C>             
CASH FLOWS FROM OPERATING ACTIVITIES: 
 Net income                                                $     109,102   $     52,373
                                                           --------------  --------------
 Adjustments to reconcile net income to net cash 
      provided by (used in) operating activities: 
            Depreciation                                         354,382        155,540
            Amortization                                          90,341         17,251 

Changes in operating assets and liabilities: 
    (Increase) in accounts receivable                         (1,154,007)      (192,997)
    (Increase) in other current assets                           (38,566)       (17,750) 
    (Increase) in inventory                                     (498,828)       (31,025)
    Decrease/(increase) in production costs                       28,951       (180,675)
    Decrease/(increase) in deposits and other assets              14,388        (56,655)
    Increase in accounts payable                                  58,677        386,031 
    (Decrease)/increase in accrued expenses                      (18,907)        29,908 
    (Decrease) in sales tax payable                                    -        (43,652)    
    (Decrease) in deferred revenue                              (275,617)             -
                                                          ---------------   ------------     
                                                              (1,439,186)        65,976 
                                                          ---------------   ------------

    NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES       (1,330,084)       118,349 
                                                          ---------------   ------------

CASH FLOWS FROM INVESTING ACTIVITIES: 
    Capital expenditures                                        (299,656)      (626,286)
    Advances to subsidiary prior to acquisition                        -       (275,000)
    Net cash used in acquisition (net of previously 
      deferred acquisition costs of $113,396 and
      cash aquired)                                                    -       (352,527) 
                                                          ---------------   ------------
    NET CASH (USED IN) INVESTING ACTIVITIES                     (299,656)    (1,253,813)
                                                          ---------------   ------------

CASH FLOWS FROM FINANCING ACTIVITIES: 
    (Decrease) in long-term debt                                       -            (95)
    Proceeds from sale of preferred stock                              -        250,939
    Increase in additional paid-in capital                             -            903 
    Proceeds from line of credit                                 358,606              - 
    Notes payable principal payments                             (60,632)             - 
    Principal payments of capital lease obligations             (217,549)             - 
                                                          ---------------   -------------
NET CASH PROVIDED BY FINANCING ACTIVITIES                         80,425        251,747
                                                          ---------------   -------------

NET (DECREASE) IN CASH                                        (1,549,315)      (883,717)

Cash, beginning of period                                      2,574,522      2,181,223 
                                                          ---------------   -------------

Cash, end of period                                         $  1,025,207    $ 1,297,506
                                                          ===============   =============    

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: 
 Cash paid during the year for:
   Cash paid for interest                                   $    137,538     $    36,664 
   Cash paid for income taxes                               $     10,617     $         - 
 Noncash activity:
   Stock issued for legal fee settlement                    $     50,000     $         - 
   Stock dividend                                           $     31,964     $     7,072
   Purchase of equipment through capital lease obligations  $    647,807     $         - 
<FN>
<FN1>

The accompanying notes are an integral part of the consolidated financial    
                              statements. 
</FN>
</TABLE>
                              Page 5 of 12

               NETTER DIGITAL ENTERTAINMENT, INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


BASIS OF PREPARATION

The accompanying unaudited consolidated financial statements have been prepared 
in accordance with generally accepted accounting principles for interim 
financial statements and with the instructions to Form 10-QSB and Article 10 of 
Regulation S-X.  Accordingly, they do not include all of the information and 
disclosures required for annual financial statements.  These financial 
statements should be read in conjunction with the consolidated financial 
statements and related footnotes for the year ended June 30, 1997 included in 
the Form 10-KSB for the year then ended.

In the opinion of the Company's management, all adjustments (consisting of 
normal recurring accruals) necessary to present fairly the Company's financial 
position as of March 31, 1998, and the results of operations and cash flows for 
the three-month and nine-month periods ended March 31, 1998, and 1997 have been 
included.

The results of operations for the three-month and nine-month periods ended March
31, 1998, are not necessarily indicative of the results to be expected for the 
full fiscal year.  For further information, refer to the consolidated financial 
statements and footnotes thereto included in the Company's  Form 10-KSB as filed
with the Securities and Exchange Commission for the year ended June 30, 1997.

The Company has adopted Statement of Financial Accounting Standard Number 128 
specifying the computation, presentation, and disclosure requirements of 
earnings per share information.  Basic earnings per share has been calculated 
based upon the weighted average number of common shares outstanding.  Stock 
options and convertible preferred stock have been excluded as common stock 
equivalents in the diluted earnings per share because they are either 
antidilutive, or their effect is not material.  Comparative earnings per share 
information for prior periods have been restated to reflect the requirements of 
this Standard.

DUE FROM OFFICER/RECEIVABLE FROM RELATED PARTY

On November 20, 1995, the Company's Chief Executive Officer entered into a 
promissory note with the Company in the amount of $194,876, bearing interest at 
7.25% per annum. The remaining unpaid principal balance of $155,897 and accrued 
interest of $9,715 is due on May 20, 1998.  The Company expects to extend the 
term of this note to May 20, 1999 upon payment of the accrued interest by Mr. 
Netter.

VIDESSENCE, INC.

On January 10, 1997, the Company completed its acquisition of Videssence, Inc. 
("Videssence") through the merger of Videssence into NDEI.  The following 
schedule combines the pro-forma financial results of operations of the Company 
and Videssence, Inc. for fiscal year 1997 as if the acquisition had occurred on 

                              Page 6 of 12

July 1, 1996 and includes such adjustments which are directly attributable to 
the acquisitions.  Such results should not be considered indicative of the 
results that would have been achieved had the acquisition not occurred or the 
results that would have been obtained had the acquisition actually occurred on 
July 1, 1996.

                                               	Nine months ended
                                                	March 31, 1997
                                                -----------------
    Revenue	                                       $19,454,434
    Net loss	                                        ($275,610)
    Net loss per share, basic and diluted	              ($0.08)
    Shares used in computation	                      3,317,221


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

General

Historically, the Company's primary operations have been to develop and produce 
media entertainment projects ("Productions" or "Projects") under agreements with
studios, networks and distributors such as Warner Bros., The Walt Disney 
Company, ABC and NBC.  While entertainment production remains the Company's 
principal activity, (1) in January 1997 it entered the business of designing, 
manufacturing and distributing lighting products in various entertainment 
industries, through its acquisition of Videssence, and (2) in the fourth quarter
of fiscal 1997, it began marketing its computer animation and visual effects 
services to outside clients.  Its business activities now are:

Entertainment Production.  It has been the Company's practice to arrange for the
studio, network or distributor to fund 100% of the production costs of its 
Projects, while retaining a back-end producer's profit participation.  Employing
this strategy, the Company avoids the financial risk of funding such production 
costs, but limits its ongoing revenue participation since the studio, network or
distributor retains a significant portion of the rights to the main and 
ancillary markets for the Projects.  Under these arrangements, revenues are 
recognized when earned (typically upon receipt) and  associated costs are 
recognized when incurred.  These revenues are primarily dependent on the number 
of Projects being produced by the Company and the agreements relating to such 
Projects.  Accordingly, year to year comparisons of production revenues from 
these sources are not necessarily indicative of future revenues.

To increase production margins, the Company has invested in in-house post 
production and computer graphics/animation facilities.  These leading-edge 
production technologies are used intensively to create the visual effects for 
"Babylon 5" and the Company's other production activities and have enabled the 
Company to significantly reduce the need for contracting out to third party 
vendors, thus allowing it to realize higher margins on its Projects.

                              Page 7 of 12

As discussed below, the Company recently secured an agreement to produce an 
all-new original television series entitled "Crusade" as well as two new 
made-for-television movies.

Computer Animation and Visual Effects Production Services.  As an outgrowth of 
its traditional core business of developing and producing media Productions, the
Company has recently entered the business of providing digital media production 
services to outside clients.  From experience gained in producing its own 
Projects, especially "Babylon 5," the Company has developed significant 
expertise in computer graphics, digital post-production and various other 
digital imaging techniques which it can utilize to service outside clients.  The
Company believes that an active market exists for projects requiring creative, 
high quality, cost effective digital graphics and effects.  These activities 
have been generating an increasing revenue stream over the past nine-month 
period as this division expands.  The Company believes that this expansion 
should continue into the foreseeable future.

Videssence Lighting Products.  The Company's Videssence subsidiary manufactures 
and distributes media lighting products which incorporate its patented 
SRGB(tm) lighting technology.  These products are used for the illumination of 
studios, stages and other production environments in the sound stage, motion 
picture, theater and theme park industries, as well as in the video 
conferencing, distant learning, and pre-press digital photography markets.  The 
Company's high-tech fluorescent lights consume significantly less electricity 
than traditional incandescent production lighting products while generating 
greatly reduced amounts of heat.  Thus, these lights are more comfortable for 
talent to work under and can generate significant electricity and 
air-conditioning related savings.  The Company markets its lighting products in 
the USA and internationally through a network of distributors, dealers, and 
direct sales staff.  To date, Videssence sales have been primarily to television
studio and video production operations.  The Company has recently introduced new
products which have been developed for the film production markets and has begun
actively marketing these products.  Of course, there can be no assurance that 
the Company will successfully enter these markets.

Results of Operations

Net Revenues.  The Company's net revenues for the third quarter and nine-month 
periods ended March 31, 1998 increased 3.2% and 36.5%, respectively, when 
compared to the same periods in the prior year.  The increase for the 
nine-months ended March 31, 1998 resulted from the following factors: (1) The 
Company realized approximately $1.5 million of additional revenues from its 
"Babylon 5" television series due to increased production activity in the first 
half of fiscal 1998. As budgets for the consecutive broadcast seasons are 
similar, this increased activity will even out over the balance of the fiscal 
year; (2) during the first half of fiscal 1998, the Company produced two new 
made for television movies for Turner Network Television which contributed 
approximately $2.3 million in revenues; (3) since Videssence was acquired in the
third quarter of fiscal 1997, the Company realized approximately $1.9 million of
additional Videssence revenues for the first three quarters of fiscal 1998; and 
(4) the Company's "Babylon 5" Fan Club and new Computer Animation and Visual 
Effects Production Service Division contributed approximately $600,000 more for 

                              Page 8 of 12

the nine-month period ended March 31, 1998, as compared to the same period of 
the prior year.  For the quarter ended March 31, 1998, the 3.2% increase in 
revenues over the same quarter of the prior year resulted primarily from 
$240,000 of additional revenues from the Fan Club and Production Service 
Division described in clause (4) above.

Gross Margin.  The Company's gross margin decreased 2.0 percentage points to 
16.0% for the three-month period ended March 31, 1998, as compared to the prior 
year.  For the nine-month period, gross margin increased 2.3 percentage points 
to 15.8% over the same prior year period.  The decrease in the quarter resulted 
from differing classifications of items in the cost of goods sold and general 
and administrative expense figures at Videssence which caused the gross margin 
to be higher than usual during this quarter of last year.  These classifications
were corrected in the fourth quarter of fiscal 1997.  The increase in the 
nine-month period resulted from two factors: First, the gross profit from the 
Company's entertainment production business increased to approximately $2.1 
million (approximately 10.6% of revenues from entertainment production 
activities) for the nine-month period ended March 31, 1998, up from 
approximately $1.5 million (approximately 9.3%) for the same period the previous
year.  This increase was the result of the Company bringing in-house a 
significant amount of post-production and graphics/animation work, greatly 
reducing its need for outside production services.  Second, sales of the 
Videssence lighting products generated gross profits of approximately $1.6 
million (with gross margin of approximately 50.6%) for the nine-month period 
ended March 31, 1998.

General and Administrative Expenses.  General and administrative expenses were 
approximately 14.1% and 14.4%, respectively, as a percentage of net revenues for
the three-month and nine-month periods ended March 31, 1998 as compared to 16.3%
and 13.3% for the same prior year periods.  As noted above, the differing in the
classification of expenses at Videssence caused its G&A expenses to be higher 
than usual during the third quarter of fiscal 1997.  The increase in the 
nine-month period resulted from the acquisition of Videssence which added 
approximately $1.7 million to such expenses.

Operating Income (Loss).  The Company achieved operating incomes of 
approximately $124,000 and $254,000 for the quarter and nine-months ended March 
31, 1998.  In the quarter ended March 31, 1998, the Company's Entertainment 
Production activities and Videssence operations combined their operating incomes
of approximately $100,000 and $24,000, respectively.  For the nine-month period 
ended March 31, 1998, operating income of approximately $432,000 from its 
Entertainment Production activities offset an operating loss of approximately 
$178,000 from its Videssence activities.  This improvement in the operating 
income of Videssence over the previous quarters can be attributed to the 
recently implemented cost-cutting measures and the sale of recently completed 
new products.

Other Income and Expenses.  Interest income decreased to $3,560 and $18,050 for 
the quarter and nine-month periods ended March 31, 1998, respectively, compared 
to $14,209 and $71,271 for the same prior year periods, as proceeds from the 
Company's November 1995 initial public offering were drawn from short term 
investments and used for expansion of its in-house post-production and 
graphics/animation facilities during fiscal 1997 and working capital for 
Videssence.  Interest expense increased to $44,589 and $137,538 for the 

                              Page 9 of 12

three-months and nine-months ended March 31, 1998, respectively, from $38,641 in
the same periods of the previous year due to the acquisition of Videssence which
has long-term debt and other credit facilities and the Company's new utilization
of capital lease lines for continued expansion of its computer animation and 
visual effects facilities.

Liquidity and Capital Resources

The Company has funded its operations to date primarily through cash from 
operations, its initial public offering of Common Stock and Warrants completed 
in November 1995 which generated net proceeds of approximately $3.2 million and,
with respect to production costs for particular entertainment Projects, through 
production contracts with studios, networks and distributors who cover 100% of 
the production funding.  Such production funds are received by the Company 
during the production stage of a Project.  To date, the Company has been able to
secure production financing from a major studio, network or distributor for all 
of its Projects.  While the Company believes that similar financing arrangements
can be made for future productions, there can be no assurance that the Company 
will be successful in obtaining such production financing.  In that event, the 
Company would have to secure alternative sources for financing Projects.  
Moreover, as the Company continues to develop new forms of high technology 
production activities and projects for new entertainment ancillary markets, it 
may elect to make additional funding commitments for these new projects and to 
cover the resulting increased overhead with its cash flow or other financing 
methods, as necessary.  These potential, new financial commitments, if pursued, 
could create additional risk for the Company as to whether it will recover the 
costs of its investment and generate a profit.

During the three-months and nine-months ended March 31, 1998, the Company 
derived approximately 96% and 97% of its entertainment production revenues,  
respectively, from its agreements with Warner Bros. relating to the production 
of the "Babylon 5" series and the associated made for television movies.  The 
Company has secured an agreement to produce a new series based on "Babylon 5" 
which will replace it after the end of the current season in May 1998.  This new
series, entitled "Crusade," will be in production during fiscal year 1999.  The 
two new made-for-television movies will bridge the end of the original 
"Babylon 5" series to the beginning of the "spin-off" series, "Crusade."

Cash used in operating activities was approximately $1.3 million for the 
nine-months ended March 31, 1998.  The biggest uses of cash were a build up of 
inventory at Videssence due to the development of a new line of lighting 
products for the film industry, and an increase in accounts receivable, also at 
Videssence, due to the termination of the Company's factoring agreement in July.
Accounts receivable in the Company's entertainment production activities also 
increased due to production timing.  Further, this period saw a large decrease 
in deferred revenue as pre-paid items for the Company's "Babylon 5" series and 
its movies of the week were used for production.

Effective July 1997, the Company's Videssence subsidiary obtained a $750,000 
line of credit with a bank, guaranteed by the Company, which required monthly 
payments of interest on outstanding principal amounts at 2% above the bank's 
reference rate.  The loan agreement also requires the Company to comply with 

                              Page 10 of 12

certain restrictive covenants, including maintaining a minimum working capital 
and specific financial ratios.  As of March 31, 1998, the Company owed an 
outstanding principal amount of approximately $359,000 on such line.

Management believes that its present cash position and overall liquidity will 
enable the Company to meet its operating commitments for the next twelve months.
As of March 31, 1998, the Company's sources of liquidity included cash and cash 
equivalents totaling approximately $1.0 million, of which approximately $600,000
is contractually committed to fund specific Projects.  The Company has 
approximately $491,000 of outstanding debt and approximately $702,000 of 
outstanding capital leases as of March 31, 1998.  All of the outstanding capital
leases were added during the first six-months of fiscal 1998 for equipment 
additions to its in-house post-production and graphics/animation facilities.


PART  II.     OTHER INFORMATION

Item 6.    	Exhibits and Reports on Form 8-K

(a.)       	Exhibits

           	Exhibit	      Description
            -------       -----------
             10.1         Equipment lease with Comerica Leasing Corporation. (1)
             10.2         Equipment lease with Digital Financial Services. (1)
           		27          	Financial Data Schedule. (1)
            ----------------------
            (1) Filed herewith.

(b.)	       Reports on Form 8-K

           	None.












                              Page 11 of 12

                              SIGNATURE



Pursuant to the requirements of the Securities Act of 1934, the Registrant has 
duly caused this report to be signed on its behalf by the undersigned thereunto 
duly authorized.


                                    NETTER DIGITAL ENTERTAINMENT, INC.
                                    Registrant	


Dated: May 14, 1998               	 By: /s/Chad Kalebic
                                    Chad Kalebic
                                    Chief Financial Officer





















                              Page 12 of 12