U.S. SECURITIES AND EXCHANGE COMMISSION
                         Washington, D.C. 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 February 28, 1999.

 ....Transition report under section 13 or 15(d) of the Securities
Exchange Act of 1934 [No Fee Required] for the transition period
from _________ to _________.

Commission File No:   __000-23559__

                      SUNBURST ACQUISITIONS III, INC.
                 ---------------------------------------
                 (Name of small business in its charter)

      Colorado                              84-14320001
----------------------               -----------------------
(State or other                      (IRS Employer Id.  No.)
jurisdiction of Incorporation)

4807 South Zang Way        Morrison,  Colorado              80465
-------------------------------------------------------------------
(Address of Principal Office)                              Zip Code

Issuer's telephone number:    (303) 979-2404

Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities 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 _____

At 2/28/99 the following shares of common were outstanding:  Preferred
Stock, no par value, 80,000 shares; Common Stock, no par value,
2,335,000 shares.

Transitional Small Business Disclosure
Format (Check one):
Yes _____     No __X__

<PAGE>

PART 1 - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS AND EXHIBITS

       (a)  The unaudited financial statements of registrant for the
three months ended February 28, 1999, follow.  The financial statements
reflect all adjustments which are, in the opinion of management,
necessary to a fair statement of the results for the interim period
presented.



                      SUNBURST ACQUISITIONS III, INC.
                      (A Development Stage Company)

                          FINANCIAL STATEMENTS
                     Quarter Ended February 28, 1999
                               (Unaudited)

<PAGE>


                             CONTENTS


     Accountants' report                                  1
     Balance Sheet                                        2
     Statements of Operations                            3
     Statements of Cash Flows                             4
     Notes to Financial Statements                        5

<PAGE>





The Board of Directors and Stockholders of
Sunburst Acquisitions III, Inc.

The accompanying balance sheet of the Sunburst Acquisitions III, Inc. (a 
development stage company) as of February 28, 1999, and the related statements 
of operations and cash flows for the period then ended were not audited by us 
and according we do not express an opinion on them.


Denver, Colorado
April 9, 1999


                                              COMISKEY & COMPANY
                                              PROFESSIONAL CORPORATION

                                     1

<PAGE>

                         Sunburst Acquisitions III, Inc.
                         (A Development Stage Company)
                                BALANCE SHEET
                              February 28, 1999
                                 (Unaudited)

<TABLE>
<S>                                                 <C>

ASSETS

CURRENT ASSETS:
   Cash and cash equivalents                         $   3,958
   Accounts receivable - related party                     103
                                                     ---------

     Total current assets                                4,061

OTHER ASSETS:
   Organizational costs (net
     of amortization)                                      210
                                                     ---------

     Total other assets                                    210
                                                     ---------
     TOTAL ASSETS                                    $   4,271
                                                     =========

  LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES                                 
   Accounts payable                                  $     400
   Accounts payable - related party                         82
                                                     ---------

     Total current liabilities                             482
                                                     ---------
STOCKHOLDERS' EQUITY
   Preferred stock, no par value
     20,000,000 shares authorized;
     80,000 shares issued and outstanding                8,000
   Common stock, no par value;
     100,000,000 shares authorized;
     2,335,000 shares issued and
     outstanding                                        12,435
   Additional paid-in capital                              900
   Deficit accumulated
     during the
     development stage                                 (17,546)
                                                     ---------
   Total stockholders' equity                           (3,789)
                                                     ---------
     TOTAL LIABILITIES AND STOCKHOLDERS'
       EQUITY                                        $   4,271
                                                     =========
</TABLE>

The accompanying notes are an integral part of the financial statements.
                                   2

<PAGE>

                             Sunburst Acquisitions III, Inc.
                              (A Development Stage Company)
                                STATEMENTS OF OPERATIONS
                                      (Unaudited)


<TABLE>
<S>                       <C>          <C>       <C>        <C>        <C>      
                          For the 
                          period from    
                          inception   
                          (August 27,  
                          1997) to     For the three months   For the six months
                          February 28,  ended February 28,    ended February 28,
                            1999          1999       1998       1999       1998
                          -----------  ---------  ---------  ---------  ---------

REVENUES                  $         -  $       -  $       -  $       -  $       -
                          -----------  ---------  ---------  ---------  ---------

EXPENSES
  Legal fees                    6,026        953          -      2,858      2,200
  General office                  528         20        277         20        292
  Consulting fees               4,935          -          -          -          -
  Professional fees             3,647      1,530      1,000      1,530      2,000
  Amortization                     90         15         15         30         30
  Transfer agent                1,313        400          -        568          -
  Taxes and licenses              107          -          -          -          -
  Rent                            900        150        150        300        300
                          -----------  ---------  ---------  ---------  ---------

      Total expense            17,546      3,068      1,442      5,306      4,822
                          -----------  ---------  ---------  ---------  ---------

NET LOSS                      (17,546)    (3,068)    (1,442)    (5,306)    (4,822)

Accumulated deficit
  Balance, Beginning 
  of period                         -    (14,478)    (5,315)   (12,240)    (1,935)
                          -----------  ---------  ---------  ---------  ---------

 Balance, End of period   $   (17,546) $ (17,546) $  (6,757)   (17,546)    (6,757)
                          ===========  =========  =========  =========  =========
NET LOSS PER SHARE        $      (.01) $    (NIL) $    (NIL) $    (NIL) $    (NIL)
                          ===========  =========  =========  =========  =========

WEIGHTED AVERAGE NUMBER
  OF SHARES OF COMMON
  STOCK AND COMMON STOCK
  EQUIVALENTS OUTSTANDING   2,151,182  2,295,000  2,095,000  2,244,724  2,095,000
                          ===========  =========  =========  =========  =========
</TABLE>
The accompanying notes are an integral part of the financial statements.
                                  3

<PAGE>

                               Sunburst Acquisitions III, Inc.
                               (A Development Stage Company)
                                 STATEMENTS OF CASH FLOWS
                                        (Unaudited)

<TABLE>
<S>                               <C>                   <C>
                                   For the period
                                   from inception
                                     (August 27,   For the six    For the six
                                      1997) to     months ended   months ended
                                     February 28,  February 28,   February 28, 
                                        1999           1999           1998
                                  ---------------  -------------  -------------

CASH FLOWS FROM 
    OPERATING ACTIVITIES:

  Net Loss                        $       (17,546) $      (5,306) $      (4,822)
  Adjustments to reconcile
     net loss to net cash used
     by operating activities:
    Amortization expense                       90             30             30
    Rent expense                              900            300            300
    Stock issued for
     consulting fees                        4,935              -              -
    Decrease in prepaid expenses                -            474              -
    Increase in accounts 
     receivable                              (103)             -              -
    Increase (decrease) in
     accounts payable                         400            (95)             -
    Increase in accounts payable
     - related party                           82             82            700
                                   --------------  -------------  -------------

  Net cash used by
   operating activities                   (11,242)        (4,515)        (3,792)

CASH FLOWS FROM 
    INVESTING ACTIVITIES

  Increase in organization costs             (300)             -              -
                                   --------------  -------------  -------------

  Net cash used by
   investing activities                      (300)             -              -

CASH FLOWS FROM
    FINANCING ACTIVITIES

  Issuance of common stock                  7,500          7,500              -  
  Issuance of preferred
   stock                                    8,000              -              -
                                   --------------  -------------  -------------

  Net cash provided
   financing activities                    15,500          7,500              -
                                   --------------  -------------  -------------

  Net increase (decrease)
   in cash and cash
   equivalents                              3,958          2,958        (3,792)

CASH AND CASH EQUIVALENTS,
  Beginning of Period                           -            973          8,000
                                   --------------  -------------  -------------

CASH AND CASH EQUIVALENTS,
 End of Period                     $        3,958  $       3,958  $       4,208
                                   ==============  =============  =============
</TABLE>
The accompanying notes are an integral part of the financial statements.
                                 4

<PAGE>

                          Sunburst Acquisitions III, Inc.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                                February 28, 1999
                                   (Unaudited)


1.  Management's Representation of Interim Financial Information
    ------------------------------------------------------------

The accompanying financial statements have been prepared by Sunburst 
Acquisitions III, Inc. without audit pursuant to the rules and regulations of 
the Securities and Exchange Commission.  Certain information and footnote 
disclosures normally included in financial statements prepared in accordance 
with generally accepted accounting principles have been condensed or omitted 
as allowed by such rules and regulations, and management believes that the 
disclosures are adequate to make the information presented not misleading.  
These financial statements include all of the adjustments which, in the opinion
of management, are necessary to a fair presentation of financial position and 
results of operations.  All such adjustments are of a normal and recurring 
nature.  These financial statements should be read in conjunction with the 
audited financial statements at August 31, 1998.

2.  Stockholder's Equity
    --------------------

For the quarter and six months ended February 28, 1999, the company sold
300,000 shares of common stock to four existing shareholders for $0.025 per
share.


                                 5

<PAGE>

Item 2.         MANAGEMENT'S DISCUSSION AND ANALYSIS OR
PLAN OF OPERATIONS.

Liquidity and Capital Resources

        The Company remains in the development stage and, since
inception, has experienced no significant change in liquidity or capital
resources or stockholder's equity other than the receipt of net proceeds
in the amount of $15,500 from its inside capitalization funds. 
Consequently, the Company's balance sheet for the period ending February
28, 1999, reflects a current asset value of $4,061 and a total asset value
of $4,271, primarily in the form of cash, as compared to $4,208 and $4,478 in
current and total assets as of February 28, 1998.

        The Company's business plan is to seek, investigate, and, if
warranted, acquire one or more properties or businesses, and to pursue
other related activities intended to enhance shareholder value.  The
acquisition of a business opportunity may be made by purchase, merger,
exchange of stock, or otherwise, and may encompass assets or a business
entity, such as a corporation, joint venture, or partnership.  The
Company has very limited capital, and it is unlikely that the Company
will be able to take advantage of more than one such business
opportunity.

        The Company will carry out its plan of business as discussed
above.  The Company cannot predict to what extent its liquidity and
capital resources will be diminished prior to the consummation of a
business combination or whether its capital will be further depleted by
the operating losses (if any) of the business entity which the Company
may eventually acquire.

Results of Operations

        During the period from August 27, 1997 (inception) through
February 28,1999, the Company has engaged in no significant operations
other than organizational activities, acquisition of capital and preparation
for registration of its securities under the Securities Exchange Act of
1934, as amended.  No revenues were received by the Company during
this period.

        For the quarter and six months ended February 28, 1999, the Company
incurred losses of $(3,068) and $(5,306), respectively, as compared to 
losses of $(1,442) and $(4,822) for the quarter and six months ended 
February 28, 1998.  The differences in losses for the quarters and six
months ended February 28, 1999 and 1998 are primarily attributable to timing
differences of expenses incurred in the compliance with reporting
requirements.

        For the current fiscal year, the Company anticipates incurring 
additional losses as a result of organizational expenses, expenses
associated with registration under the Securities Exchange Act of 1934, and
expenses associated with locating and evaluating acquisition candidates. 
The Company anticipates that until a business combination is completed with
an acquisition candidate, it will not generate revenues and may continue
to operate at a loss after completing a business combination, depending
upon the performance of the acquired business.

Need for Additional Financing

        The Company believes that its existing capital will be sufficient
to meet the Company's cash needs, including the costs of compliance
with the continuing reporting requirements of the Securities Exchange
Act of 1934, as amended, for a period of approximately one year. 
Accordingly, in the event the Company is able to complete a business
combination during this period, it anticipates that its existing capital will
be sufficient to allow it to accomplish the goal of completing a business
combination.  There is no assurance, however, that the available funds
will ultimately prove to be adequate to allow it to complete a business
combination, and once a business combination is completed, the
Company's needs for additional financing are likely to increase
substantially.

        No commitments to provide additional funds have been made by
management or other stockholders.  Accordingly, there can be no
assurance that any additional funds will be available to the Company to
allow it to cover its expenses.

        Irrespective of whether the Company's cash assets prove to be
inadequate to meet the Company's operational needs, the Company
might seek to compensate providers of services by issuances of stock in
lieu of cash.

        Year 2000 issues are not currently material to the Company's business,
operations or financial condition, and the Company does not currently anticipate
that it will incur any material expenses to remediate Year 2000 issues it may
encounter.  However, Year 2000 issues may become material to the Company
following its completion of a business combination transaction.  In the event,
the company will be required to adopt a plan and a budget for addressing such
issues.

PART II

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

       (a)  EXHIBIT 27 - FINANCIAL DATA SCHEDULE

       There have been no reports on Form 8-K for the quarter ending
February 28, 1999.

<PAGE>
Signatures

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

SUNBURST ACQUISITIONS III, INC.
(Registrant)

Date: April 9, 1999

/s/
Michael R. Quinn, Secretary/Treasurer