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Detroit Diesel Corporation Form 10-Q (continued)

                                                                      EXHIBIT 11


                           Detroit Diesel Corporation
                 Statement of Computation of Earnings Per Share


<TABLE>
<CAPTION>
                                                      Three Months Ended June 30,               Six Months Ended June 30,
                                                         1998              1997                 1998                 1997
                                                         ----              ----                 ----                 ----
<S>                                                 <C>               <C>                  <C>                  <C>          
Basic net income per share                          
      Net income                                    $  10,400,000     $   7,400,000        $  20,100,000        $  13,800,000
                                                    
                                                    
      Weighted average number of shares outstanding    24,701,899        24,699,566           24,701,858           24,699,566
                                                    -------------     -------------        -------------        -------------
Basic net income per share                          $        0.42     $        0.30        $        0.81        $        0.56
                                                    =============     =============        =============        =============
                                                    
Diluted net income per share:                       
      Net income                                    $  10,400,000     $   7,400,000        $  20,100,000        $  13,800,000
                                                    
                                                    
      Weighted average number of shares outstanding    24,701,899        24,699,566           24,701,858           24,699,566
      Dilutive effect of stock options                    102,768 (1)        40,687 (2)           82,891 (1)           13,964 (2)
                                                    -------------     -------------        -------------        -------------
      Weighted average number of shares outstanding    24,804,667        24,740,253           24,784,749           24,713,530
                                                    -------------     -------------        -------------        -------------
Diluted net income per share                        $        0.42     $        0.30        $        0.81        $        0.56
                                                    =============     =============        =============        =============
</TABLE>


          (1)  Represents the weighted average dilutive effect of 301,310,
               265,250, 103,750, 20,000, 2,500 and 219,250 stock options
               exercisable at $20.00, $17.00, $23.75, $21.81, $23.94 and $22.69
               per share, respectively, calculated using the treasury stock
               method.

          (2)  Represents the weighted average dilutive effect of 300,250,
               267,500, 106,000 and 5,000 stock options exercisable at $20.00,
               $17.00, $23.75 and $18.00 per share, respectively, calculated
               using the treasury stock method.

  







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