===========================================================================



                     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 THE QUARTERLY PERIOD ENDED MARCH 31, 1998

                       Commission file number 1-3605




                   KAISER ALUMINUM & CHEMICAL CORPORATION
           (Exact name of registrant as specified in its charter)


              DELAWARE                               94-0928288
      (State of incorporation)            (I.R.S. Employer Identification 
                                             No.)


         6177 SUNOL BOULEVARD, PLEASANTON, CALIFORNIA   94566-7769
            (Address of principal executive offices)     (Zip Code)


                               (925) 462-1122
            (Registrant's telephone number, including area code)





     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       
    -----        -------

     At April 29, 1998, the registrant had 46,171,365 shares of common
stock outstanding.





===========================================================================

      KAISER ALUMINUM & CHEMICAL CORPORATION AND SUBSIDIARY COMPANIES

                       PART I - FINANCIAL INFORMATION


ITEM 1.  FINANCIAL STATEMENTS
         --------------------

                        CONSOLIDATED BALANCE SHEETS
                          (In millions of dollars)
<TABLE>

<CAPTION>
                                                            March 31,    December 31,
                                                                 1998            1997
                                                       ------------------------------
<S>                                                    <C>             <C>
                         ASSETS                          (Unaudited)
Current assets:
     Cash and cash equivalents                         $        21.1   $        15.8 
     Receivables                                               324.4           345.3 
     Inventories                                               528.1           568.3 
     Prepaid expenses and other current assets                 140.3           121.3 
                                                       ------------------------------
          Total current assets                               1,013.9         1,050.7 

Investments in and advances to unconsolidated
     affiliates                                                149.5           148.6 
Property, plant, and equipment - net                         1,162.5         1,171.8 
Deferred income taxes                                          325.4           329.0 
Other assets                                                   316.0           317.2 
                                                       ------------------------------

               Total                                   $     2,967.3   $     3,017.3 
                                                       ==============================

           LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities:
     Accounts payable                                  $       150.4   $       176.2 
     Accrued interest                                           24.8            37.6 
     Accrued salaries, wages, and related expenses              84.4            97.9 
     Accrued postretirement medical benefit obligation
          - current portion                                     45.3            45.3 
     Other accrued liabilities                                 147.3           145.9 
     Payable to affiliates                                      83.0            82.4 
     Long-term debt - current portion                            8.0             8.8 
                                                       ------------------------------
          Total current liabilities                            543.2           594.1 

Long-term liabilities                                          486.6           492.0 
Accrued postretirement medical benefit obligation              715.1           720.3 
Long-term debt                                                 962.6           962.9 
Minority interests                                              97.5            98.4 
Redeemable preference stock                                     27.0            27.7 
Commitments and contingencies
Stockholders' equity:
     Preferred stock                                             1.6             1.6 
     Common stock                                               15.4            15.4 
     Additional capital                                      1,968.6         1,939.8 
     Accumulated deficit                                      (140.2)         (152.3)
     Less:  Note receivable from parent                     (1,710.1)       (1,682.6)
                                                       ------------------------------
          Total stockholders' equity                           135.3           121.9 
                                                       ------------------------------

               Total                                   $     2,967.3   $     3,017.3 
                                                       ==============================

</TABLE>



The accompanying notes to interim consolidated financial statements are an 
     integral part of these statements.

      KAISER ALUMINUM & CHEMICAL CORPORATION AND SUBSIDIARY COMPANIES

                     STATEMENTS OF CONSOLIDATED INCOME
                                (Unaudited)
                          (In millions of dollars)

<TABLE>

<CAPTION>
                                                                Quarter Ended
                                                                  March 31,
                                                       ------------------------------
                                                                 1998            1997
                                                       ------------------------------
<S>                                                    <C>             <C>
Net sales                                              $       597.0   $       547.4 
                                                       ------------------------------

Costs and expenses:
     Cost of products sold                                     499.6           460.7 
     Depreciation                                               22.9            23.1 
     Selling, administrative, research and development,
          and general                                           29.5            30.8 
                                                       ------------------------------
               Total costs and expenses                        552.0           514.6 
                                                       ------------------------------

Operating income                                                45.0            32.8 

Other income (expense):
     Interest expense                                          (28.0)          (27.7)
     Other - net                                                  .6             2.6 
                                                       ------------------------------

Income before income taxes and minority interests               17.6             7.7 

Provision for income taxes                                      (6.2)           (2.9)

Minority interests                                               1.0             (.5)
                                                       ------------------------------

Net income                                             $        12.4   $         4.3 
                                                       ==============================

</TABLE>

The accompanying notes to interim consolidated financial statements are an 
     integral part of these statements.


      KAISER ALUMINUM & CHEMICAL CORPORATION AND SUBSIDIARY COMPANIES

                   STATEMENTS OF CONSOLIDATED CASH FLOWS
                                (Unaudited)
                          (In millions of dollars)
<TABLE>

<CAPTION>
                                                                Quarter Ended
                                                                  March 31,
                                                       ------------------------------
                                                                 1998            1997
                                                       ------------------------------
<S>                                                    <C>             <C>
Cash flows from operating activities:
     Net income                                        $        12.4   $         4.3 
     Adjustments to reconcile net income to net cash                                 
          provided (used) by operating activities:
          Depreciation                                          22.9            23.1 
          Amortization of excess investment over equity
               in unconsolidated affiliates                      2.5             2.9 
          Amortization of deferred financing costs and
               net discount on long-term debt                    1.3             1.5 
          Undistributed equity in (income) loss of
               unconsolidated affiliates, net of  
               distributions                                    (3.7)            8.6 
          Minority interests                                    (1.0)             .5 
          Decrease (increase) in receivables                    21.4           (39.5)
          Decrease (increase) in inventories                    40.2           (13.7)
          Decrease (increase) in prepaid expenses and
               other assets                                       .4           (27.2)
          Decrease in accounts payable                         (25.8)          (38.3)
          Decrease in accrued interest                         (12.7)          (12.3)
          (Decrease) increase in payable to affiliates
               and accrued liabilities                         (34.8)            4.3 
          (Decrease) increase in accrued and deferred
               income taxes                                     (1.1)             .3 
          Other                                                  1.9              .6 
                                                       ------------------------------
               Net cash provided (used) by operating
                    activities                                  23.9           (84.9)
                                                       --------------  --------------

Cash flows from investing activities:
     Net proceeds from disposition of property and
          investments                                           -                2.6 
     Capital expenditures                                      (13.7)          (21.8)
     Other                                                      (3.2)           (2.8)
                                                       ------------------------------
               Net cash used by investing activities           (16.9)          (22.0)
                                                       ------------------------------

Cash flows from financing activities:
     Borrowings under revolving credit facility, net            -               42.0 
     Borrowings of long-term debt                               -               19.0 
     Repayments of long-term debt                                (.9)           (3.9)
     Payments on note payable to parent                         -               (2.2)
     Decrease (increase) in restricted cash, net                  .6           (12.6)
     Incurrence of financing costs                              -                (.4)
     Dividends paid                                              (.3)            (.2)
     Redemption of minority interests' preference stock         (1.1)           (1.6)
                                                       ------------------------------
               Net cash (used) provided by financing
                    activities                                  (1.7)           40.1 
                                                       ------------------------------

Net increase (decrease) in cash and cash equivalents
     during the period                                           5.3           (66.8)
Cash and cash equivalents at beginning of period                15.8            81.3 
                                                       ------------------------------
Cash and cash equivalents at end of period             $        21.1   $        14.5 
                                                       ==============================

Supplemental disclosure of cash flow information:
     Interest paid, net of capitalized interest        $        34.4   $        38.5 
     Income taxes paid                                           5.2             1.6 
     Tax allocation payments to Kaiser Aluminum
          Corporation                                            1.2              .5 

</TABLE>


The accompanying notes to interim consolidated financial statements are an 
     integral part of these statements.

             NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
       (In millions of dollars, except prices and per share amounts)

1.   GENERAL

     Kaiser Aluminum & Chemical Corporation (the "Company") is the
principal operating subsidiary of Kaiser Aluminum Corporation ("Kaiser"). 
Kaiser is a subsidiary of MAXXAM Inc. ("MAXXAM").  MAXXAM and one of its
wholly owned subsidiaries together own approximately 63% of the Company's
Common Stock with the remaining approximately 37% publicly held.

     The foregoing unaudited interim consolidated financial statements have
been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q
and Article 10 of Regulation S-X as promulgated by the Securities and
Exchange Commission.  Accordingly, these financial statements do not
include all of the disclosures required by generally accepted accounting
principles for complete financial statements.  These unaudited interim
consolidated financial statements should be read in conjunction with the
audited consolidated financial statements for the year ended December 31,
1997.  In the opinion of management, the unaudited interim consolidated
financial statements furnished herein include all adjustments, all of which
are of a normal recurring nature, necessary for a fair statement of the
results for the interim periods presented.

     Statement of Financial Accounting Standards No. 130, Reporting
Comprehensive Income ("SFAS No. 130") was issued in June 1997 with adoption
required for fiscal years beginning after December 31, 1997.  SFAS No. 130
requires the presentation of an additional income measure (termed
"comprehensive income"), which adjusts traditional net income for certain
items that previously were only reflected as direct charges to equity (such
as minimum pension liabilities).  The dollar amount of the Company's
adjustments required by SFAS No. 130 is not significant so there is not a
significant difference between "traditional" net income and comprehensive
income for the quarters ended March 31, 1998 and 1997.

     The preparation of financial statements in accordance with generally
accepted accounting principles requires the use of estimates and
assumptions that affect the reported amounts of assets and liabilities,
disclosure of contingent assets and liabilities known to exist as of the
date the financial statements are published, and the reported amounts of
revenues and expenses during the reporting period. Uncertainties with
respect to such estimates and assumptions are inherent in the preparation
of the Company's consolidated financial statements; accordingly, it is
possible that the actual results could differ from these estimates and
assumptions, which could have a material effect on the reported amounts of
the Company's consolidated financial position and results of operations.

     Operating results for the quarter ended March 31, 1998, are not
necessarily indicative of the results that may be expected for the year
ending December 31, 1998.

2.   INVENTORIES

     The classification of inventories is as follows:

<TABLE>

<CAPTION>
                                                            March 31,    December 31,
                                                                 1998           1997 
                                                       -----------------------------
<S>                                                    <C>             <C>
Finished fabricated aluminum products                  $        101.2  $       103.9 
Primary aluminum and work in process                            181.9          226.6 
Bauxite and alumina                                             120.8          108.4 
Operating supplies and repair and maintenance parts             124.2          129.4 
                                                       -----------------------------
     Total                                             $        528.1  $       568.3 
                                                       =============================

</TABLE>

     Substantially all product inventories are stated at last-in, first-out
(LIFO) cost, not in excess of market. Replacement cost is not in excess of
LIFO cost.

3.   CONTINGENCIES

ENVIRONMENTAL CONTINGENCIES
     The Company is subject to a number of environmental laws, to fines or
penalties assessed for alleged breaches of such environmental laws, and to
claims and litigation based upon such laws.  The Company currently is
subject to a number of lawsuits under the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended by the
Superfund Amendments Reauthorization Act of 1986 ("CERCLA"), and, along
with certain other entities, has been named as a potentially responsible
party for remedial costs at certain third-party sites listed on the
National Priorities List under CERCLA.

     Based on the Company's evaluation of these and other environmental
matters, the Company has established environmental accruals primarily
related to potential solid waste disposal and soil and groundwater
remediation matters.  At March 31, 1998, the balance of such accruals,
which are primarily included in Long-term liabilities, was $29.8.  These
environmental accruals represent the Company's estimate of costs reasonably
expected to be incurred based on presently enacted laws and regulations,
currently available facts, existing technology, and the Company's
assessment of the likely remediation actions to be taken.  The Company
expects that these remediation actions will be taken over the next several
years and estimates that annual expenditures to be charged to these
environmental accruals will be approximately $2.0 to $9.0 for the years
1998 through 2002 and an aggregate of approximately $7.0 thereafter.

     The Company believes that it has insurance coverage available to
recover certain incurred and future environmental costs and is actively
pursuing claims in this regard.  However, no accruals have been made for
any such insurance recoveries and no assurances can be given that the
Company will be successful in its attempt to recover incurred or future
costs.

     As additional facts are developed and definitive remediation plans and
necessary regulatory approvals for implementation of remediation are
established or alternative technologies are developed, changes in these and
other factors may result in actual costs exceeding the current
environmental accruals.  The Company believes that it is reasonably
possible that costs associated with these environmental matters may exceed
current accruals by amounts that could range, in the aggregate, up to an
estimated $18.0.  As the resolution of these matters is subject to further
regulatory review and approval, no specific assurance can be given as to
when the factors upon which a substantial portion of this estimate is based
can be expected to be resolved.  However, the Company is currently working
to resolve certain of these matters.

     While uncertainties are inherent in the final outcome of these
environmental matters, and it is presently impossible to determine the
actual costs that ultimately may be incurred, management currently believes
that the resolution of such uncertainties should not have a material
adverse effect on the Company's consolidated financial position, results of
operations, or liquidity.

ASBESTOS CONTINGENCIES
     The Company is a defendant in a number of lawsuits, some of which
involve claims of multiple persons, in which the plaintiffs allege that
certain of their injuries were caused by, among other things, exposure to
asbestos during, and as a result of, their employment or association with
the Company or exposure to products containing asbestos produced or sold by
the Company.  The lawsuits generally relate to products the Company has not
manufactured for at least 20 years.  At March 31, 1998, the number of such
claims pending was approximately 81,500, as compared with 77,400 at
December 31, 1997.  In 1997, approximately 15,600 of such claims were
received and 9,300 were settled or dismissed.  During the quarter ended
March 31, 1998, approximately 5,400 of such claims were received and 1,300
of such claims were settled or dismissed, respectively.  However, the
foregoing claim and settlement figures as of and for the quarter ended
March 31, 1998, do not reflect the fact that as of March 31, 1998, the
Company reached agreements under which the Company will settle approximately
25,000 of the pending asbestos-related claims over an extended period.

     Based on past experience and reasonably anticipated future activity,
the Company has established an accrual for estimated asbestos-related costs
for claims filed and estimated to be filed through 2008.  There are
inherent uncertainties involved in estimating asbestos-related costs, and
the Company's actual costs could exceed or be less than these estimates. 
The Company's accrual was calculated based on the current and anticipated
number of asbestos-related claims, the prior timing and amounts of
asbestos-related payments, and the advice of Wharton Levin Ehrmantraut
Klein & Nash, P.A. with respect to the current state of the law related to
asbestos claims.  Accordingly, an estimated asbestos-related cost accrual
of $155.6, before consideration of insurance recoveries, is included
primarily in Long-term liabilities at March 31, 1998.  While the Company
does not presently believe there is a reasonable basis for estimating such
costs beyond 2008 and, accordingly, no accrual has been recorded for such
costs which may be incurred beyond 2008, there is a reasonable possibility
that such costs may continue beyond 2008, and such costs may be
substantial.  The Company estimates that annual future cash payments in
connection with such litigation will be approximately $13.0 to $20.0 for
each of the years 1998 through 2002, and an aggregate of approximately
$80.0 thereafter.

     The Company believes that it has insurance coverage available to
recover a substantial portion of its asbestos-related costs.  Claims for
recovery from some of its insurance carriers are currently subject to
pending litigation and other carriers have raised certain defenses, which
have resulted in delays in recovering costs from the insurance carriers. 
The timing and amount of ultimate recoveries from these insurance carriers
are dependent upon the resolution of these disputes.  The Company believes,
based on prior insurance-related recoveries in respect of asbestos-related
claims, existing insurance policies, and the advice of Thelen, Marrin,
Johnson & Bridges LLP with respect to applicable insurance coverage law
relating to the terms and conditions of those policies, that substantial
recoveries from the insurance carriers are probable.  Accordingly, an
estimated aggregate insurance recovery of $115.7, determined on the same
basis as the asbestos-related cost accrual, is recorded primarily in Other
assets at March 31, 1998.  During the first quarter of 1998, the Company
reached agreements on asbestos-related coverage matters with two insurance
carriers under which the Company collected a total of approximately $17.5.

     Management continues to monitor claims activity, the status of
lawsuits (including settlement initiatives), legislative progress, and
costs incurred in order to ascertain whether an adjustment to the existing
accruals should be made to the extent that historical experience may differ
significantly from the Company's underlying assumptions. While
uncertainties are inherent in the final outcome of these asbestos matters
and it is presently impossible to determine the actual costs that
ultimately may be incurred and insurance recoveries that will be received,
management currently believes that, based on the factors discussed in the
preceding paragraphs, the resolution of asbestos-related uncertainties and
the incurrence of asbestos-related costs net of related insurance
recoveries should not have a material adverse effect on the Company's
consolidated financial position, results of operations, or liquidity.

OTHER CONTINGENCIES
     The Company is involved in various other claims, lawsuits, and other
proceedings relating to a wide variety of matters.  While uncertainties are
inherent in the final outcome of such matters, and it is presently
impossible to determine the actual costs that ultimately may be incurred,
management currently believes that the resolution of such uncertainties and
the incurrence of such costs should not have a material adverse effect on
the Company's consolidated financial position, results of operations, or
liquidity.

     See Note 10 of the Notes to Consolidated Financial Statements for the
year ended December 31, 1997.

4.   DERIVATIVE FINANCIAL INSTRUMENTS AND RELATED HEDGING PROGRAMS

     At March 31, 1998, the net unrealized gain on the Company's position
in aluminum forward sales and option contracts, (based on an average price
of $1,643 per ton* ($.75 per pound) of primary aluminum), natural gas, fuel
oil and diesel fuel forward purchase and option contracts, and forward
foreign exchange contracts, was approximately $11.5.  Any gains or losses 
--------------------
*  All references to tons in this report refer to metric tons of 2,204.6
pounds.


on the derivative contracts utilized in the Company's hedging activities
are offset by losses or gains, respectively, on the transactions being
hedged.

ALUMINA AND ALUMINUM
     The Company's earnings are sensitive to changes in the prices of
alumina, primary aluminum and fabricated aluminum products, and also depend
to a significant degree upon the volume and mix of all products sold. 
Primary aluminum prices have historically been subject to significant
cyclical fluctuations.  Since 1993, the Average Midwest United States
transaction price for primary aluminum has ranged from approximately $.50
to $1.00 per pound. Alumina prices as well as fabricated aluminum product
prices (which vary considerably among products) are significantly
influenced by changes in the price of primary aluminum but generally lag
behind primary aluminum price changes by up to three months.

     From time to time in the ordinary course of business, the Company
enters into hedging transactions to provide price risk management in
respect of the net exposure of earnings resulting from (i) anticipated
sales of alumina, primary aluminum and fabricated aluminum products, less
(ii) expected purchases of certain items, such as aluminum scrap, rolling
ingot, and bauxite, whose prices fluctuate with the price of primary
aluminum.  Forward sales contracts are used by the Company to effectively
fix the price that it will receive for its shipments.  The Company also
uses option contracts (i) to establish a minimum price for its product
shipments, (ii) to establish a "collar" or range of prices for its
anticipated sales, and/or (iii) to permit it to realize possible upside
price movements.  As of March 31, 1998, the Company had sold forward, at
fixed prices, approximately 76,450 and 24,000 tons of primary aluminum with
respect to 1998 and 1999, respectively.  As of March 31, 1998, the Company
had also purchased put options to establish a minimum price for
approximately 33,750 tons of primary aluminum with respect to 1998 and had
entered into option contracts that established a price range for an
additional 173,700, and 124,500 tons for 1998 and 1999, respectively. 
Additionally at March 31, 1998, the Company also held fixed price purchase
contracts for 79,800 tons of primary aluminum with respect to 1998.

     As of March 31, 1998, the Company had sold forward virtually all of
the alumina available to it in excess of its projected internal smelting
requirements for 1998, 1999 and 2000 at prices indexed to future prices of
primary aluminum.

ENERGY
     The Company is exposed to energy price risk from fluctuating prices
for fuel oil and natural gas consumed in the production process. 
Accordingly, the Company from time to time in the ordinary course of
business enters into hedging transactions with major suppliers of energy
and energy related financial instruments.  As of March 31, 1998, the
Company had a combination of fixed price purchase and option contracts for
the purchase of approximately 45,000 MMBtu of natural gas per day during
the remainder of 1998.  As of March 31, 1998, the Company also held a
combination of fixed price purchase and option contracts for an average of
232,000 and 39,000 barrels per month of fuel oil and diesel fuel for 1998
and 1999, respectively.

FOREIGN CURRENCY
     The Company enters into forward exchange contracts to hedge material
cash commitments to foreign subsidiaries or affiliates.  At March 31, 1998,
the Company had net forward foreign exchange contracts totaling
approximately $198.5 for the purchase of 277.0 Australian dollars from
April 1998 through December 2000, in respect of its commitments for 1998
through 2000 expenditures denominated in Australian dollars.

     See Note 11 of the Notes to Consolidated Financial Statements for the
year ended December 31, 1997.

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          ---------------------------------------------------------------
          RESULTS OF OPERATIONS
          ---------------------

     This section should be read in conjunction with the response to Item
1, Part I, of this Report.

     This section contains statements which constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform
Act of 1995.  These statements appear in a number of places in this section
(see, for example, "Recent Events and Developments," "Results of
Operations," and "Liquidity and Capital Resources").  Such statements can
be identified by the use of forward-looking terminology such as "believes,"
"expects," "may," "estimates," "will," "should," "plans" or "anticipates"
or the negative thereof or other variations thereon or comparable
terminology, or by discussions of strategy.  Readers are cautioned that any
such forward-looking statements are not guarantees of future performance
and involve significant risks and uncertainties, and that actual results
may vary materially from those in the forward-looking statements as a
result of various factors.  These factors include the effectiveness of
management's strategies and decisions, general economic and business
conditions, developments in technology, new or modified statutory or
regulatory requirements, and changing prices and market conditions.  This
section and the Company's Annual Report on Form 10-K for the year ended
December 31, 1997, each identify other factors that could cause such
differences.  No assurance can be given that these are all of the factors
that could cause actual results to vary materially from the forward-looking
statements.

RECENT EVENTS AND DEVELOPMENTS

     The Company has previously disclosed that it set a goal of achieving
$120.0 million of pre-tax cost reductions and other profit improvements,
independent of metal price changes, with the full effect planned to be
realized in 1998 and beyond, measured against 1996 results.  Management
believes that recent operating performance has been at a rate which
indicates that its objective will be achieved by the end of 1998.  However,
there are inherent uncertainties regarding operating factors and economic
and other external forces (such as the Valco power situation discussed
below), many of which are outside management's direct control, and, as
such, no assurances can be given that the desired benefit of profit
improvements will be achieved.

     In addition to working to improve the performance of the Company's
existing assets, the Company has expended significant efforts on analyzing
its current asset portfolio with the intent of focusing its efforts and
capital in sectors of the industry that are considered most attractive. 
The initial steps of this process led to the formation of the AKW wheel
joint venture and the acquisition of the Bellwood aluminum extrusion plant
in Richmond, Virginia.  Additional portfolio analysis and initiatives are
ongoing.

     As of March 31, 1998, the Company reached agreements under which the
Company will settle approximately 25,000 of the pending asbestos-related
claims over an extended period.  Also during the first quarter of 1998,
the Company reached agreements on asbestos-related coverage matters with
two insurance carriers under which the Company collected a total of
approximately $17.5 million. As the amounts related to the claim settlements
and insurance recoveries were consistent with the Company's year-end 1997
accrual assumptions, these events are not expected to have a material impact
on the Company's financial position, results of operations, or liquidity.

     During April 1998, the Company's 90%-owned Volta Aluminium Company
Limited ("Valco") smelter in Ghana announced that it had reached an
agreement with the Volta River Authority ("VRA") to receive compensation in
lieu of the power necessary to run an additional potline that was curtailed
on April 6, 1998.  The compensation is expected to substantially mitigate
the financial impact of the curtailment.  As a result of the curtailment,
Valco will be operating one if its five potlines, as compared to 1997, when
Valco operated four potlines.  Valco had previously curtailed two of its
potlines in 1998, one in January, for which it received no compensation,
and one in February, for which it will be compensated.  As previously
announced, the Company has notified the VRA that it believes it had the
contractual rights at the beginning of 1998 to sufficient energy to run
four and one-half potlines for the balance of the year.  Valco continues to
seek compensation from the VRA with respect to the January 1998 reduction
of its power allocation.  Valco and the VRA also are in continuing
discussions concerning other matters, including steps that might be taken
to reduce the likelihood of power curtailments beyond 1998.  No assurances
can be given as to the success of these discussions, the possibility of
requests from the VRA for additional curtailments, or as to the operating
level of Valco for the remainder of 1998 or beyond.

RESULTS OF OPERATIONS

     The table on the following page provides selected operational and
financial information on a consolidated basis with respect to the Company
for the quarters ended March 31, 1998, and 1997.  As an integrated aluminum
producer, the Company uses a portion of its bauxite, alumina and primary
aluminum production for additional processing at certain of its other
facilities.  Intracompany shipments and sales are excluded from the
information set forth on the following page.

     Interim results are not necessarily indicative of those for a full
year.

               SELECTED OPERATIONAL AND FINANCIAL INFORMATION
                                (Unaudited)
           (In millions of dollars, except shipments and prices)

<TABLE>

<CAPTION>
                                                                Quarter Ended
                                                                  March 31,
                                                       ------------------------------
                                                                 1998            1997
                                                       ------------------------------
<S>                                                    <C>             <C>
Shipments: (1)
     Alumina                                                   424.6           385.5 

     Aluminum products:
          Primary aluminum                                      80.5            78.5 
          Fabricated aluminum products                         105.5            93.9 
                                                       ------------------------------
               Total aluminum products                         186.0           172.4 
                                                       ==============================

Average realized sales price:
     Alumina (per ton)                                 $         201   $         190 
     Primary aluminum (per pound)                                .71             .75 

Net sales:
     Bauxite and alumina:
          Alumina                                      $        85.5   $        73.2 
          Other (2) (3)                                         25.7            26.6 
                                                       ------------------------------
               Total bauxite and alumina                       111.2            99.8 
                                                       ------------------------------

     Aluminum processing:
          Primary aluminum                                     126.2           129.2 
          Fabricated aluminum products                         356.9           314.4 
          Other (3)                                              2.7             4.0 
                                                       ------------------------------
               Total aluminum processing                       485.8           447.6 
                                                       ------------------------------
                  Total net sales                      $       597.0   $       547.4 
                                                       ==============================

Operating income (loss):
     Bauxite and alumina                               $         6.1   $        (1.5)
     Aluminum processing                                        56.1            51.3 
     Corporate                                                 (17.2)          (17.0)
                                                       ------------------------------
          Total operating income                       $        45.0   $        32.8 
                                                       ==============================

Net income                                             $        12.4   $         4.3 
                                                       ==============================

Capital expenditures                                   $        13.7   $        21.8 
                                                       ==============================

</TABLE>


-----------------------------------
(1)  In thousands of metric tons.
(2)  Includes net sales of bauxite.
(3)  Includes the portion of net sales attributable to minority interests
     in consolidated subsidiaries.

OVERVIEW
     The Company's operating results are sensitive to changes in prices of
alumina, primary aluminum, and fabricated aluminum products, and also
depend to a significant degree on the volume and mix of all products sold
and on its hedging strategies.  Primary aluminum prices have historically
been subject to significant cyclical fluctuations. Alumina prices as well
as fabricated aluminum product prices (which vary considerably among
products) are significantly influenced by changes in the price of primary
aluminum but generally lag behind primary aluminum price changes by up to
three months.

     During 1997, the Average Midwest Transaction Price ("AMT Price") for
primary aluminum remained fairly stable generally in the $.75 - $.80 range
through November and then declined during December to the $.70 - $.75
range.  During the first three months of 1998, the AMT Price for primary
aluminum was generally in the $.68 - $.73 per pound range.  The AMT Price
for primary aluminum for the week ended April 24, 1998, was approximately
$.70 per pound.

     See Note 4 of the Notes to Interim Consolidated Financial Statements
for a discussion of the Company's hedging activities.

QUARTER ENDED MARCH 31, 1998, COMPARED TO QUARTER ENDED MARCH 31, 1997

SUMMARY
     The Company reported net income of $12.4 million for the first quarter
of 1998, compared to a net income of $4.3 million for the same period of
1997. Net sales in the first quarter of 1998 totaled $597.0 million
compared to $547.4 million in the first quarter of 1997.

BAUXITE AND ALUMINA
     Net sales of alumina increased by 16% for the quarter ended March 31,
1998, from the comparable period in the prior year, as a result of a 6%
increase in average realized prices from the sale of alumina and a 10%
increase in alumina shipments.  The fluctuation in shipment volumes as
compared to the quarter ended March 31, 1997, was primarily attributable to
the timing of shipments.  Segment operating income improved substantially
on a quarter to quarter basis.  The improvement resulted primarily from
improvements in average realized prices and operating efficiencies and
reduced energy prices.

ALUMINUM PROCESSING
     Net sales of primary aluminum for the quarter ended March 31, 1998,
decreased by 2% from the comparable prior year period as a result of a 5%
decrease in average realized prices offset by a 3% increase in shipments. 
Net sales of fabricated aluminum products for the quarter ended March 31,
1998, were up 14% as compared to the prior year period as a result of a 12%
increase in shipments and a 2% increase in average realized prices.  The
increase in fabricated aluminum product shipments over the first quarter of
1997 was the result of the Company's June 1997 acquisition of the Bellwood
extrusion facility in Richmond, Virginia, as well as increased shipments of
heat-treat products.

     Operating income for the aluminum processing segment increased by
approximately $5.0 million as reduced power and material costs and improved
operating efficiencies in the primary aluminum smelting operations, as well
as improvements in the Company's fabricated aluminum products operations,
more than offset the impact of the decline in the average realized price
for primary aluminum and the impacts of the Valco potline curtailments
discussed above.  The quarter-over-quarter improvement in the Company's
fabricated aluminum products operations reflects the impacts of the Bellwood
acquisition, continued demand for heat-treat products, and an improvement
in operating performance.  The impact of the Valco potline curtailments was
only partially reflected in operating results as one of the potlines was
curtailed after quarter-end and as the two lines curtailed prior to March
31, 1998, operated for part of the quarter.  Reduced operating results
attributable to such first quarter 1998 curtailments, as well as
incremental charges recorded in the quarter associated with potline shut-
down costs, were partially offset by compensation recorded by the Company
(which will be received over an 18 month period beginning in June 1998) for
one of the two lines curtailed during the quarter.  As previously stated,
Valco continues to seek compensation with respect to the January 1998
potline curtailment, but no assurance can be given that Valco will be
successful in this regard.  Operating income for the quarter ended March
31, 1997, included approximately $5.0 million of operating income realized
during the period related to the settlement of certain issues related to
energy service contracts.

CORPORATE
     Corporate operating expenses represent corporate general and
administrative expenses, which are not allocated to the Company's business
segments.

LIQUIDITY AND CAPITAL RESOURCES

OPERATING ACTIVITIES
     At March 31, 1998, the Company had working capital of $470.7 million,
compared with working capital of $456.6 million at December 31, 1997.  The
increase in working capital primarily results from decreases in Accounts
payable and other current liabilities more than offsetting decreases in
Receivables and Inventories.

INVESTING ACTIVITIES
     Capital expenditures during the quarter ended March 31, 1998, were
$13.7 million and were used primarily to improve production efficiency,
reduce operating costs, expand capacity at existing facilities, and
construct new facilities.  Total consolidated capital expenditures (of
which approximately 8% is expected to be funded by the Company's minority
partners in certain foreign joint ventures) are expected to be between
$75.0 and $125.0 million per annum in each of 1998 through 2000.

     During the first quarter of 1998, the first Micromill(TM) facility,
which was constructed in Nevada during 1996 as a demonstration and
production facility, delivered its first commercial product shipments to
customers, but the amount of such shipments was minimal.  Additional
product trials for international and domestic customers are ongoing and the
Company currently expects increased commercial deliveries from the facility
during the second quarter of 1998.  However, the Micromill(TM) technology
has not yet been fully implemented or commercialized, and there can be no
assurances that full implementation or commercialization will be
successful.

     Management continues to evaluate numerous projects, including the
Micromill(TM) technology, all of which would require substantial capital,
both in the United States and overseas.

FINANCING ACTIVITIES AND LIQUIDITY

     At March 31, 1998, the Company had long-term debt of $970.6 million,
compared with $971.7 million at December 31, 1997.

     At March 31, 1998, $272.1 million (of which $52.9 million could have
been used for letters of credit) was available to the Company under the
Credit Agreement and no amounts were outstanding under the revolving credit
facility.  Loans under the Credit Agreement bear interest at a spread
(which varies based on the results of a financial test) over either a base
rate or LIBOR at the Company's option.  During the quarter ended March 31,
1998, the average per annum interest rates on loans outstanding under the
Credit Agreement was approximately 9%.  The Credit Agreement does not
permit the Company to pay any dividends on its common stock.

     Management believes that the Company's existing cash resources,
together with cash flows from operations and borrowings under the Credit
Agreement, will be sufficient to meet its working capital and capital
expenditure requirements for the next year.  Additionally, with respect to
long-term liquidity, management believes that operating cash flow, together
with the ability to obtain both short and long-term financing, should
provide sufficient funds to meet the Company's working capital and capital
expenditure requirements.

                        PART II - OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS
          -----------------

Asbestos-related Litigation

     The Company is a defendant in a number of lawsuits, some of which
involve claims of multiple persons, in which the plaintiffs allege that
certain of their injuries were caused by, among other things, exposure to
asbestos during, and as a result of, their employment or association with
the Company or exposure to products containing asbestos produced or sold by
the Company.  The portion of Note 3 of the Notes to Interim Consolidated
Financial Statements contained in this report under the heading "Asbestos
Contingencies" is incorporated herein by reference.  See Part I, Item 3.
"LEGAL PROCEEDINGS - Asbestos-related Litigation" in the Company's Form 10-
K for the year ended December 31, 1997.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K
          --------------------------------

     (a)  Exhibits.

     Exhibit No.    Exhibit
     -----------    -------

      3.1 Restated Certificate of Incorporation of Kaiser Aluminum &
          Chemical Corporation (the "Company" or "KACC"), dated July 25,
          1989 (incorporated by reference to Exhibit 3.1 to the
          Registration Statement on Form S-1, dated August 25, 1989, filed
          by KACC, Registration No. 33-30645).

      3.2 Certificate of Retirement of KACC, dated February 7, 1990
          (incorporated by reference to Exhibit 3.2 to the Report on Form
          10-K for the period ended December 31, 1989, filed by KACC, File
          No. 1-3605).

      3.3 Amended and Restated Bylaws of KACC, dated October 1, 1997.

     *10  Form of Deferred Fee Agreement between Kaiser Aluminum Corporation
          ("KAC"), KACC, and directors of KAC and KACC.

     *27  Financial Data Schedule.

     (b)  Reports on Form 8-K.

     No Report on Form 8-K was filed by the Company during the quarter
     ended March 31, 1998.






---------------
*    Filed herewith

                                 SIGNATURE

     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, who have signed this report on
behalf of the registrant as the principal financial officer and principal
accounting officer of the registrant, respectively.

                                        KAISER ALUMINUM & CHEMICAL
                                        CORPORATION


                                             /s/   John T. La Duc
                                        By: ----------------------------
                                                   John T. La Duc
                                                Vice President and 
                                              Chief Financial Officer
                                           (Principal Financial Officer)


                                             /s/  Daniel D. Maddox
                                        By: -----------------------------
                                                  Daniel D. Maddox
                                              Controller - Corporate 
                                            Consolidation and Reporting
                                           (Principal Accounting Officer)



Dated:    May 5, 1998