SECURITIES AND EXCHANGE COMMISSION
                   Washington, D.C. 20549




                          FORM 10-Q

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


For Quarter Ended                               Commission File No.
December 31, 1997                                     33-67422




                   SABRELINER CORPORATION
   (Exact name of registrant as specified in its charter)




       Delaware                                      43-1289921
(State of Incorporation)                         (I.R.S. Employer
                                                Identification No.)




                    Pierre Laclede Center
                         Suite 1500
                     7733 Forsyth Blvd.
                St. Louis Missouri 63105-1821
                       (314) 863-6880
                              
  (Name, address, including ZIP Code, and telephone number,
including area code, of registrant's principal executive offices)
                              
                              
                              
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  report(s), and (2) has been subject  to  such  filing
requirements for the past 90 days.   YES [ X ] NO [   ]

The number of shares of the Company's common stock outstanding on
January 31, 1998 was 869,934.

PART I - FINANCIAL INFORMATION
Condensed Financial Statements

                              
                   Sabreliner Corporation
                 Consolidated Balance Sheets
                   (Dollars in Thousands)
                              
                                       Unaudited          Audited
                                   December 31, 1997   June 30, 1997
                                      
Assets                                                   
Current assets:                                          
  Cash                               $  2,169             $ 22,994
   Accounts receivable (net of                        
     allowances of $548 and $550,      26,881               29,952
     respectively)
   Inventories                         40,753               31,542
   Contracts in process (net of                       
     customer advances and progress                     
     payments of $20,361 and           43,971               20,192
     $15,143, respectively)
  Prepaid and other current             6,778                4,697
     assets
        Total current assets          120,552              109,377
                                                   
Property and equipment, (net of                    
  depreciation of $23,055 and          44,983               37,882
  $21,286, respectively)
Deferred financing costs and            8,587                9,641
  other assets
                                                   
  Total assets                       $174,122             $156,900
                                                   
Liabilities and stockholders'                      
  equity
Current liabilities:                               
  Accounts payable                   $ 31,382             $ 24,997
  Current portion of long-term                       
    debt and capital leases               711                  750
  Customer advances                     3,111                5,588
  Accrued compensation                  5,683                7,068
  Accrued interest expense              2,034                1,946
  Other accrued liabilities             5,915                8,994
     Total current liabilities         48,836               49,343
                                                   
Long-term debt and capital             93,971               94,863
  leases
Revolving credit facility              15,144                    -
Other long-term liabilities             2,201                2,202
                                                   
Stockholders' equity                   13,970               10,492
                                                   
  Total liabilities and              $174,122             $156,900
  stockholders' equity
                      
        
                   Sabreliner Corporation
            Consolidated Statements of Operations
                         (Unaudited)
 (Dollars in Thousands, Share and per Share Data as Stated)


                        Three Months Ended            Six Months Ended
                     December 31   December 31    December 31  December 31
                        1997          1996           1997         1996
                                                                      
Net revenue           $69,159       $51,729       $132,312       $102,698
Cost of revenue        55,214        45,557        104,737         87,404
 Gross margin          13,945         6,172         27,575         15,294
Selling, general                                         
 and administrative
 expense                8,025         9,360         15,574         16,106
                                                         
 Operating income       5,920        (3,188)        12,001           (812)
 loss
                                                       
Interest expense,      (3,320)       (3,280)        (6,312)        (6,284)
 net
Other income               10            (6)           (57)            (3)
 (expense)                        
 Earnings (loss)        2,610        (6,474)         5,632         (7,099)
   before income
   taxes                                                         
Income tax               (990)        2,754         (2,139)         2,964
 (expense) benefit
                                                         
 Net income (loss)     $1,620       $(3,720)        $3,493       $ (4,135)
 earnings per share 
                                                
 Basic earnings        $ 1.86        $(4.27)         $4.01        $(4.75)
 (loss) per share                   
                                                         
 Diluted earnings      $ 1.85        $(4.25)         $3.99        $(4.73)
 (loss) per share
                                                         
 Dividends paid per                                      
 common share          $ 0.00        $ 0.00          $0.00        $0.00
                                                       
                   Sabreliner Corporation
            Consolidated Statements of Cash Flows
                         (Unaudited)
                   (Dollars in Thousands)
                              
                                             Six Months Ended
                                        December 31,   December 31,
                                            1996          1997
Cash flows from operating activities:                
Net income (loss)                         $ 3,493       $ (4,135)
                                                     
Adjustments to reconcile net earnings                
  to net cash provided by operating
  activities:
       Depreciation                         3,016          3,006
       Amortization                           646            601
       Changes in assets and              (34,857)       (15,746)
         liabilities
                                                     
Net cash used by operating activities     (27,702)       (16,274)
                                                     
Cash flows used in investing                         
  activities:
Capitalized expenditures                  (10,121)        (3,802)
                                                     
Cash flows from financing activities:                
Principal payments on long-term debt         (381)          (577)
  and capital leases
Proceeds from revolving credit                       
  facility and other short-term            17,394          9,550
  borrowings
Purchase of treasury stock                    (15)             -
Net cash provided by financing             16,998          8,973
  activities
                                                     
Net decrease in cash and  cash            (20,825)       (11,103)
  equivalents
                                                     
Cash and cash equivalents, beginning       22,994         12,254
  of period
                                                     
Cash and cash equivalents, end of         $ 2,169       $ 1,151
  period


Notes to Unaudited Condensed Financial Statements

Basis of Presentation

The   information  set  forth  in  these  interim  financial
statements  as  of  and for the three and six  months  ended
December  31,  1997 and December 31, 1996 is unaudited.   In
the   opinion   of   management,  the  unaudited   financial
statements  reflect  all adjustments necessary  to   present
fairly  the financial results of Sabreliner Corporation  and
its  subsidiaries Midcoast Aviation, Inc., SabreTech,  Inc.,
Dimension   Aviation,  Inc.  and  Turbotech  Repairs,   Inc.
(operating  as  part of Premier Turbines)  for  the  periods
indicated.   Results  of operations for the  interim  period
ended  December 31, 1997 are not necessarily  indicative  of
the results of operations for the full fiscal year.

Inventories

Components of inventories as of  December 31, 1997 and  June
30, 1997 were:

                               December       June
                                           
        Aircraft parts         $36,766       $28,839
        Raw materials            1,637         1,403
        Pre-owned aircraft       2,350         1,300
           Total               $40,753       $31,542

Contracts in Process

Contracts in process represent accumulated contract cost and
estimated  earnings  thereon based upon  the  percentage  of
completion  of  unbilled customer orders, net of  applicable
customer  advance  or  progress  payments.   In  determining
balances  of  contracts in process, the Company follows  all
the  requirements  of  SOP81-1.   Title  to  or  a  security
interest  in certain items included in contracts in  process
can be vested in the U.S. government and other customers  by
reasons of progress payment provisions of related contracts.
Included in the contracts in process as of December 31, 1997
are the proportionate revenues earned on amounts subject  to
claim  settlement, representing less than $1.0 million.   In
accordance  with  industry standards, contracts  in  process
relating  to long-term contracts are classified  as  current
assets even though a portion may not be realized within  one
year.

Earnings Per Share

In  1997,  the  Financial Accounting Standards Board  issued
Statement  of  Financial  Accounting  Standards   No.   128,
Earnings per Share.  Adoption of Statement 128 requires  the
replacement of the previously-reported primary earnings  per
share with a dual presentation of basic and diluted earnings
per  share.   Basic  earnings per share  is  computed  using
outstanding common stock only.  Diluted earnings  per  share
includes  the  dilutive  effects of  options,  warrants  and
convertible securities.  All earnings per share amounts  for
all  periods  have  been  presented,  and  where  necessary,
restated to conform to the Statement 128 requirements.   The
following  table  sets forth the computation  of  basic  and
diluted earnings per share:
                              
                        Three Months Ended         Six Months Ended            
                     December 31   December 31   December 31  December 31
                        1997          1996          1997         1996
Numerator:                                               
  Numerator for basic                                      
  EPS - Net income     $ 1,620     $(3,720)       $ 3,493       $(4,135)
                                                         
  Effect of dilutive         -            -              -             -
   securities
  Numerator for                                          
   fully diluted       $ 1,620     $(3,720)       $ 3,493       $(4,135)
   EPS                
                                                         
Denominator:                                             
  Denominator for                                          
    basic EPS -        869,934     870,934        870,434       870,884
    weighted-average
    shares
                                                         
 Employee stock         4,937       4,106          4,937         4,118
   options
    Denominator                                             
      diluted EPS -                                            
      weighted-       874,871     875,040        875,371       875,002
      average shares
      and assumed 
      conversions
                                                            
EPS:                                                        
Basic earnings per     $ 1.86     $(4.27)         $4.01       $(4.75)
share             
                                                            
Diluted earnings per   $ 1.85     $(4.25)         $3.99       $(4.73)
share     
                                                            
                                                            
Options  to purchase 1,400 shares of common stock at  $17.22
per share which were outstanding through August 19, 1996 and
4,000  shares of common stock at $15.00 per share which  are
currently  outstanding were not included in the  computation
of  diluted earnings per share because the options' exercise
price  was greater than or equal to the average market price
of  the  common shares, and, therefore, the effect would  be
antidilutive.

Contingencies

Refer  to  PART  II  -  OTHER  INFORMATION,  Item  1.  Legal
Proceedings.


Management's Discussion and Analysis of Financial  Condition
and Results of Operations

Overview

Operating income for the quarter ended December 31, 1997 was
$5.9  million.   The Company reported an operating  loss  of
$3.2  million for the same period a year ago.  A portion  of
this  $9.1  million  increase can be  attributed  to  losses
recognized  by  the Company in fiscal 1997 relating  to  the
ValuJet  crash  (see  PART II - OTHER INFORMATION,  Item  l.
Legal  Proceedings) totaling $5.2 million, representing  the
increased  cost of legal fees and other continuing  expenses
and  the  operating  loss recognized at the  Miami  facility
caused  by  declines  in  customer  demand.   Excluding  the
effects  of  the  ValuJet  crash on  fiscal  1997  earnings,
operating income for the quarter ended December 31, 1997 was
$3.9  million higher than the same period of the prior year,
reflecting  increased  profits  on  new  government  awards,
particularly  engine contracts, and the  increased  customer
demand  for  corporate  aviation, particularly  in  interior
modification.

Operating income for the six months ended December 31,  1997
was  $12.0  million, versus a reported loss of $0.8  million
for  the  same  period last year.  After adjusting  for  the
effects  of  the  ValuJet  crash on  fiscal  1997  earnings,
totaling $6.3 million, operating income for the most  recent
six   months   ended  is  $6.5  million  higher   than   the
corresponding  period of the previous year, representing  an
increase  of over 115%.  The performance on recently-awarded
government  contracts  provided $7.9  million  in  increased
operating  income.   Increased volume in corporate  aviation
business  accounted  for  another  $2.2  million   of   this
increase.   Offsetting  such increases  were  reductions  in
commercial  aviation  profits of $1.8 million,  representing
the net effect of declines in volume at SabreTech, after the
addition  of  new  business  at  Dimension  Aviation.    The
remaining  reduction  in  comparable  operating  profit   is
attributable to increased S,G&A expenses.

Quarter  and Six Months Ended December 31, 1997 as  Compared
to Quarter and Six Months Ended December 31, 1996

Revenues  for the quarter and six months ended December  31,
1997  were $17.4 million and $29.6 million higher  than  the
corresponding  periods  of the prior  year.   During  fiscal
1997,  the  Company  closed commercial  aviation  facilities
which had provided $3.7 million and $11.2 million in revenue
for  the  quarter  and six months ended December  31,  1996.
Excluding  these facilities for comparison purposes  results
in increases in revenue for the quarter and six months ended
of   $21.1   million   and   $40.8  million,   respectively.
Performance   on   recently  awarded  government   contracts
provided  for the majority of this increase, accounting  for
$12.0  million  and $23.0 million for the  quarter  and  six
months,  respectively.   Corporate  aviation  revenues  also
increased,  reflecting  a growth of  $7.4  million  for  the
quarter  and  $12.7 million for the most recent  six  months
ended, as compared to the same periods of the previous year.
The   increases  experienced  in  corporate  aviation   were
generated  through the Company's investment  in  new  engine
product  lines  and  through increased customer  demand  for
airframe  interior modifications.  The addition of Dimension
Aviation,  Inc.  to perform the MD-10/MD-11  program,  which
converts  airline  aircraft to freighter  configuration  for
Boeing, increased the quarter and six months revenue by $9.1
million   and   $18.4   million,  respectively.    Partially
offsetting  the  growth in revenues in other business  areas
were declines in volume at the SabreTech commercial aviation
subsidiary of $7.4 million for the quarter and $13.3 million
for   the  most  recent  six  months,  as  compared  to  the
corresponding periods of the prior year.

The  growth  in gross margin for the quarter and six  months
ended  was  $7.8  million  and $12.3 million,  respectively.
After  adjustment for facilities closed during fiscal  1997,
comparative gross margins increased for both the quarter and
six  months by $6.3 million and $10.3 million, respectively.
The  majority  of this increase was generated by  government
business,  representing $5.0 million  and  $7.9  million  in
incremental  gross margins for the quarter  and  six  months
ended,   primarily  through  engine  contracts.    Corporate
aviation gross margin also increased during the quarter  and
first six months of fiscal 1998, as compared to the previous
year,  by  $1.1  million  and  $2.7  million,  respectively,
reflecting  increased  customer  demand,  particularly   for
interior  modifications at the Company's  Midcoast  Aviation
subsidiary.   Performance  on the  MD-10/MD-11  subcontracts
with  Boeing at Dimension Aviation, Inc. provided additional
gross  margin of $1.0 million and $2.9 million in  the  most
recent  quarter  and  six  months, respectively.   Partially
offsetting such increases were declines at SabreTech of $0.8
million  and $3.2 million, reflecting the drop in volume  at
the  Phoenix  facility  and labor overruns  on  fixed  price
contracts.

Selling, general and administrative expenses for the quarter
and  six  months  ended December 31, 1997,  after  excluding
facilities removed from operation and the effect of ValuJet-
related  expense (see PART II - OTHER INFORMATION,  Item  1.
Legal  Proceedings)  in the prior year,  increased  by  $2.2
million  and  $4.4 million, respectively.  The expansion  in
administrative staff associated with Dimension Aviation  and
incremental marketing expenses account for this increase.

Outlook

A  comparison of backlog by business area as of December 31,
1997 and June 30, 1997 follows:

                               Outstanding Backlog
                              December         June
                             (Dollars in Thousands)
                                           
        Corporate Aviation    $ 19,023        $ 17,832
        Government Business     76,913         112,058
        Commercial Aviation    101,151         122,655
                              $197,087        $252,545

Liquidity and Capital Resources

The  Company's cash balance declined by $20.8 million during
the  six months ended December 31, 1997.  In addition to the
consumption of existing cash balances, the Company  accessed
its   revolving   credit  facility   during   this   period:
outstanding revolving debt totaled $15.1 million at December
31,  1997.  These capital resources, totaling $35.9 million,
were  used  to  fund  investments in the Company's  existing
business for working capital and fixed assets.  The  largest
investment for the period was made at Dimension Aviation  to
fund   working  capital  growth  and  facility  enhancements
necessary  to  perform  the  MD-10/MD-11  subcontracts  with
Boeing.   Total  investments at  Dimension  Aviation  as  of
December  31, 1997 were $28.4 million.  The Company  expects
additional  working  capital resources  to  be  required  at
Dimension  during  the  third and  fourth  quarters  as  the
contract  reaches  its peak investment requirements.   Other
major  investments include the construction of a new  hangar
at Midcoast Aviation and the related working capital growth,
totaling $9.2 million.

The Company also considers making acquisitions of businesses
from   time  to  time,  although  there  is  no  outstanding
commitment  to  make any such acquisition.  Other  than  the
continuing  investments  at  Dimension  and  Midcoast,   the
Company  does  not  expect  any  significant  commitment  of
capital  resources in the near future.  The Company believes
its  remaining  credit facility, combined  with  cash  flows
generated  by  operations, will be adequate  to  meet  known
future cash requirements.

The  Company  may  have  provided certain  "forward-looking"
information (as defined in the Private Securities Litigation
Report  Act  of 1995) which may involve risk or uncertainty,
including,  but  not  limited to:  future  sales,  earnings,
margins,  production levels and costs, aircraft  deliveries,
research   and   development,   environmental   and    other
expenditures,  and various business trends.  Actual  results
and  trends  in  the future may differ materially  from  the
projections, depending on a variety of factors.


PART II - OTHER INFORMATION

Item 1.  Legal Proceedings

ValuJet Related

On May 11, 1996, ValuJet Flight 592 from Miami, carrying 110
passengers and crew crashed into the Florida Everglades.  On
August  19,  1997, the National Transportation Safety  Board
(NTSB)  conducted its public hearing and issued an  Abstract
of  Final  Report  on ValuJet Flight 592  which  listed  the
probable  causes of the accident to be (1)  the  failure  of
SabreTech  to properly prepare, package, identify and  track
unexpended  oxygen  generators  before  presenting  them  to
ValuJet for carriage, (2) the failure of ValuJet to properly
oversee   its   contract  maintenance  program   to   ensure
compliance   with  maintenance,  maintenance  training   and
hazardous  materials  requirements  and  practices  and  (3)
failure  of  the  Federal Aviation Administration  (FAA)  to
require  smoke  detection and fire  suspression  systems  in
Class  D cargo compartments.  The NTSB also found that other
acts  and  omissions by ValuJet and FAA contributed  to  the
accident.

SabreTech,  ValuJet and others have been named as defendants
in  numerous wrongful death actions that have been filed  by
families of victims.  The Company's legal costs of defending
against   these   civil  actions  and  any  possible   claim
settlements are funded by the Company's insurance  policies.
Management believes coverage is adequate to provide for such
legal actions.

SabreTech has filed a Complaint for Declaratory Judgment and
Other Relief against ValuJet in the U.S. District Court  for
the  Southern District of Florida.  Among other things, that
suit seeks indemnification for damages incurred by SabreTech
in  connection  with  the accident.  ValuJet  has  filed  an
Answer  and  Conditional Counterclaim in  the  case  seeking
various damages.  Airtran Airlines, Inc., formally known  as
ValuJet,  also  has filed a petition against  SabreTech  and
Sabreliner  in  the  Circuit  Court  of  St.  Louis  County,
Missouri.  The Petition essentially seeks damages  based  on
the  same  allegations  that are  in  ValuJet's  Conditional
Counterclaim.  The Company's legal costs associated with the
Declaratory Judgment, the Counterclaim and the Petition  are
funded  by  the  Company's insurance  policies.   Management
believes  that  the  Company will be  able  to  successfully
defend   against   ValuJet's  Counterclaim   and   Airtran's
Petition.

In  addition,  SabreTech is one of several  subjects  of  an
investigation  being conducted by a federal  grand  jury  in
conjunction with the United States Attorney for the Southern
District  of  Florida.   The Company  has  cooperated  fully
throughout these investigations and is continuing to do so.

Uninsured  costs  of  approximately $6.4 million  associated
with  this  accident  (such as media relations,  incremental
professional services, legal fees and other costs related to
the  various  investigations and other lawsuits)  have  been
incurred since May, 1996. The ultimate outcome of the  legal
actions  related  to the ValuJet Flight 592  crash  and  the
length  of  time  necessary to resolve all  the  outstanding
issues cannot be determined at this time.  The Company  does
not   know   whether   the   continuing   effects   of   the
investigations  and related lawsuits will  have  a  material
adverse  effect  on the results of operations  or  financial
condition of the Company.

Environmental

The Company has been subject to government inquiry regarding
alleged  environmental wrongdoing that may have occurred  at
the  Perryville  facility before the flood  of  July,  1993.
Several  requests for documents concerning this matter  have
been received since January, 1994, most recently July, 1997.
All requests for documents have been complied with or are in
the process of resolution.  In addition, various current and
former  employees have received subpoenas or notice  letters
identifying  each  as  a witness, subject  or  target.   The
Company  believes it has meritorious defenses to allegations
of   wrongdoing,   if  any,  that  may   result   from   the
investigation.

Other

In  addition to the litigation discussed above, the  Company
is  subject to other legal proceedings and claims arising in
the ordinary course of its business.  Although there can  be
no  assurance  as to the outcome of litigation,  it  is  the
opinion  of  management  (based upon  the  advice  of  legal
counsel) that all such actions or proceedings are covered by
insurance or will be resolved without material effect on the
Company's financial position or results of operations.


Item 6.  Exhibits and Reports on Form 8-K

(a)  Exhibits Filed

     Exhibit 27 - Financial Data Schedule.

(b)  Reports on Form 8-K

     No  reports on Form 8-K were filed by the Company  during
     the quarter ended December 31, 1997.

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


                         SABRELINER CORPORATION



Date:  February 12, 1998 /s/  F. Holmes Lamoreux
                         F. Holmes Lamoreux
                         Chairman of the Board and
                         Chief Executive Officer



Date:  February 12, 1998 /s/ Rodney E. Olson
                         Rodney E. Olson
                         Senior Vice President, Finance  and
                         Corporate  Development  and   Chief
                         Financial Officer