FORM 10-Q
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549


{X}   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the Quarterly Period ended September 30, 1997

                                       OR

     { } TRANSITION  REPORT  PURSUANT TO SECTION 13 OR 15 (d) OF THE  SECURITIES
EXCHANGE ACT OF 1934

For the transition period from ____________________ to _________________________

Commission File Number 0-5896

                             JACO ELECTRONICS, INC.
             (Exact name of registrant as specified in its charter)


               NEW YORK                               11-1978958
         (State of other jurisdiction of    (I.R.S. Employer Identification No.)
         incorporation or organization)


                     145 OSER  AVENUE,  HAUPPAUGE,  NEW YORK 11788  
                   (Address  of principal executive office) (Zip Code)



Registrant's telephone number, including area code:   (516)  273-5500

Indicated  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),  and (2) has been subject to such
filing requirements for the past 90 days.



                                YES X         NO






Number of Shares of Registrant's Common Stock Outstanding as of November 7, 1997
- 3,888,221 (Excluding 87,500 Shares of Treasury Stock).

<PAGE>


FORM 10-Q                                             September 30, 1997
Page 2


PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS


                     JACO ELECTRONICS, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)


                                          September 30,     June 30,
                                             1997             1997
                                          --------------    ------
ASSETS

Current Assets:

      Cash                                $401,696          $463,352
      Marketable securities                677,351           627,179
      Accounts receivable - net         22,233,277        22,008,210
      Inventories                       34,357,124        33,311,201
      Prepaid expenses and other           996,520         1,359,617
      Prepaid income taxes                 233,408           528,243
      Deferred income taxes                776,000           750,000
                                           -------           -------

            Total current assets        59,675,376        59,047,802


Property, plant and equipment - net      5,027,153         5,009,045

Deferred income taxes                      253,000           244,000

Excess of cost over net assets acquired  4,097,252         4,151,574

Other assets                             1,516,054         1,543,257
                                         ---------         ---------


                                       $70,568,835       $69,995,678

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

See accompanying notes to condensed consolidated financial statements.


<PAGE>



FORM 10-Q                                                 September 30, 1997
Page 3



                     JACO ELECTRONICS, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)


                                                September 30,          June 30,
                                                   1997                  1997
                                               ______________         __________
LIABILITIES & SHAREHOLDERS' EQUITY:

Current Liabilities:

      Accounts payable and accrued expenses       $17,620,132        $17,302,127
      Current maturities of long term debt and
      capitalized lease obligations                   616,447            599,239
                                                  ___________         __________

      Total current liabilities                    18,236,579         17,901,366

Long term debt and capitalized lease obligations   15,349,791         15,552,549

Deferred compensation                                 662,500            650,000


SHAREHOLDERS' EQUITY:


      Preferred stock - authorized,  100,000 shares,
       $10 par value; none issued
      Common  stock -  authorized  10,000,000  shares,
      $.10 par  value;  issued 3,975,721 and
      3,888,221 outstanding                               397,572        397,572
      Additional paid-in capital                       22,180,295     22,180,295
      Unrealized gain on marketable securities            150,372        120,200
      Retained earnings                                14,291,726     13,893,696
      Treasury stock                                     (700,000)     (700,000)
                                                         --------       --------
      Total shareholders' equity                       36,319,965     35,891,763
                                                       ----------     ----------


                                                      $70,568,835    $69,995,678
                                                      ============    ==========




See accompanying notes to condensed consolidated financial statements.



<PAGE>


FORM 10-Q                                             September 30, 1997
Page 4



                     JACO ELECTRONICS, INC. AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
                    FOR THE THREE MONTHS ENDED SEPTEMBER 30,
                                   (UNAUDITED)



                                                         1997          1996
                                                         ----          ----


NET SALES                                              $36,878,534  $38,321,790
                                                       -----------  -----------


COST AND EXPENSES:

      Cost of goods sold                                 29,061,380   30,206,288
                                                         ----------   ----------

      Gross profit                                        7,817,154    8,115,502

      Selling, general and administrative expenses        6,877,115    6,592,245
                                                          ----------   ---------
      Operating profit                                      940,039    1,523,257

      Interest expense                                      272,009      199,616
                                                            -------      -------

      Earnings before income taxes                          668,030    1,323,641

      Income tax provision                                  270,000      536,000
                                                            -------      -------


      NET EARNINGS                                         $398,030     $787,641
                                                           ========     ========

      Net earnings per common share                    $        .10 $        .20
                                                       ============ ============

      Weighted average common shares and common
        equivalent shares outstanding                     3,943,192    3,982,259




See accompanying notes to condensed consolidated financial statements.




<PAGE>

<TABLE>
<CAPTION>

FORM 10-Q                                                                       September 30,1997
Page 5



                     JACO ELECTRONICS, INC. AND SUBSIDIARIES
                        CONSOLIDATED STATEMENT OF CHANGES
                             IN SHAREHOLDERS' EQUITY
                  FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997
                                  (UNAUDITED)






                                                             Unrealized
                                               Additional     Gain on                              Total
                               Common Stock    Paid-In       Marketable  Retained   Treasury      Shareholders'
                              Shares   Amount   Capital      Securities  Earnings   Stock           Equity
                              ______   ______   _________   ___________  _________  __________    ______________   

<S>             <C>           <C>       <C>       <C>         <C>      <C>         <C>            <C>
Balance at July 1, 1997        3,975,721 $397,572  $22,180,295 $120,200 $13,893,696 $(700,000)    $35,891,763


Unrealized gain on marketable
  securities                                                    30,172                                  30,172


Net earnings                                                                398,030                    398,030

                              --------  ----------  ---------- ------    --------    --------          --------
                             
Balance at September 30,1997  3,975,721 $397,572 $22,180,295 $150,372   $14,291,726  $(700,000)       $36,319,965
                              ========= ======== ==========  ========   ===========  ==========      ==============    

</TABLE>




          See accompanying notes to condensed consolidated financial statements.


<PAGE>


FORM 10-Q                                                   September 30, 1997
Page 6

<TABLE>
<CAPTION>


                               JACO ELECTRONICS, INC. AND SUBSIDIARIES
                         CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                            FOR THE THREE MONTHS ENDED SEPTEMBER 30,
                                          (UNAUDITED)
                                                            1997                   1996
                                                           _______                _______   
Cash flows from operating activities

<S>                                                         <C>                   <C>
   Net earnings                                          $    398,030    $    787,641

Adjustments to reconcile net earnings to net
   cash provided by (used in) operating activities
      Depreciation  and amortization                          242,428         207,082
      Deferred compensation                                    12,500          12,500
      Deferred income tax provision                           (55,000)        (66,000)
      Amortization of intangible assets                        87,655          16,584
      Gain on sale of equipment                                               (11,094)
      Provision for doubtful accounts                          89,375         117,125
      Changes  in   operating   assets  and  
      liabilities,   net  of  effect  of acquisitions:
      (Increase) decrease in operating assets - net          (702,433)        630,430
      Increase in operating liabilities - net                 318,005          30,311
                                                              -------          -------
      Net cash provided by operating activities               390,560       1,724,579
                                                              --------      ----------

Cash flows from investing activities
      Capital expenditures                                   (260,536)       (243,083)
      Proceeds from sale of equipment                                           34,000
      Acquisition of operating assets - net                                (1,240,327)
      Increase in other assets                                 (6,130)       (138,953)
                                                             ---------       ---------
      Net cash used in investing activities                  (266,666)     (1,588,363)
                                                            ----------     -----------
Cash flows from financing activities
      Borrowings under line of credit                      35,455,080      41,420,780
      Payments under line of credit                       (35,489,278)    (40,449,000)
      Principal payments under equipment financing
      and term loans                                         (151,352)       (119,499)
      Purchase of treasury stock                                             (700,000)
                                                         ------------    ------------

  Net cash (used in) provided by financing activities        (185,550)        152,281
                                                         ------------     -----------
      NET (DECREASE) INCREASE IN CASH                         (61,656)        288,497
                                                         ------------    ------------

   Cash at beginning of period                                463,352         164,161
                                                         ------------    ------------

   Cash at end of period                                 $    401,696    $    452,658
                                                         ============    ============

</TABLE>

          See accompanying notes to condensed consolidated financial statements.


<PAGE>


FORM 10-Q                                             September 30, 1997
 Page 7


                     JACO ELECTRONICS, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

NOTE A - BASIS OF PRESENTATION

1) The accompanying  condensed  consolidated  financial  statements  reflect all
   adjustments,  consisting only of normal recurring accrual adjustments,  which
   are in the opinion of management,  necessary for a fair  presentation  of the
   consolidated  financial position and the results of operations at and for the
   periods  presented.   Such  financial  statements  do  not  include  all  the
   information or footnotes  necessary for a complete  presentation.  Therefore,
   they should be read in conjunction  with the Company's  audited  consolidated
   statements for the year ended June 30, 1997 and the notes thereto included in
   the Company's  annual report on Form 10-K.  The results of operations for the
   interim periods are not necessarily  indicative of the results for the entire
   year.

2) For interim financial reporting  purposes,  the Company uses the gross profit
   method for computing inventories, which consists of goods held for resale.

3) The Company has a $30,000,000 term loan and revolving line of credit facility
   with its banks, which are based principally on eligible accounts  receivables
   and inventories as defined in the agreement. The agreement was amended to (i)
   extend the maturity date to September 13, 2000, (ii) change the interest rate
   to a rate  based  on the  average  30 day  LIBOR  rate  plus  3/4 % to 1 1/4%
   depending  on  the  Company's  performance  measured  by a  financial  ratio,
   effective  January  1, 1998 and (iii)  changed  the  requirements  of certain
   financial  covenants.  The applicable interest rate may be adjusted quarterly
   and borrowings under this facility are collateralized by substantially all of
   the assets of the Company.

4) In April 1996, the Company  announced that its Board of Directors  authorized
   the purchase of up to 250,000 shares of its outstanding  common stock under a
   stock repurchase program.  The purchases may be made by the Company from time
   to time on the open market at the Company's  discretion.  During fiscal 1997,
   the  Company  purchased  87,500  shares of its  common  stock  for  aggregate
   consideration of $700,000.


5) Earnings  per share has been  computed  based on weighted  average  number of
   shares outstanding,  including  approximately  55,000 and 51,000 common stock
   equivalents  for the  three  months  ending  September  30,  1997  and  1996,
   respectively.  In February 1997, the Financial Accounting Standards Board has
   issued  Statement of Financial  Accounting  Standards No. 128,  "Earnings Per
   Share,"  which is effective  for  financial  statements  for both interim and
   annual  periods  ending after  December 15, 1997.  Early  adoption of the new
   standard is not  permitted.  The new  standard  eliminates  primary and fully
   diluted  earnings  per share and requires  presentation  of basic and diluted
   earnings per share together with disclosure of how the per share amounts were
   computed.  The  adoption of this  standard is not expected to have a material
   impact on the disclosure of earnings per share in the financial statements.

6) During August 1996, and January 1997, the Company  purchased QPS Electronics,
   Inc. and Corona Electronics, Inc., respectively, both of which are electronic
   component  distributors.  Aggregate  consideration  paid for the acquisitions
   approximated  $4,700,000  of which  $157,500 was paid through the issuance of
   20,000 shares of the Company's  common stock.  These  acquisitions  have been
   accounted  for by the  purchase  method and,  as such,  the fair value of the
   assets  and  liabilities  acquired  have  been  recorded  on the  date of the
   respective  acquisitions.  The  respective  results of their  operations  are
   included with those of the Company from the date of  acquisition.  The excess
   of  the  purchase  price,  over  the  fair  value  of  the  assets  acquired,
   approximately  $3,053,000,  is being amortized using the straight-line method
   over a period of twenty years. Pro forma historical results of operations are
   not  presented,  as such results would not be materially  different  from the
   historical results of the Company.



<PAGE>




FORM 10-Q                                             September 30, 1997
Page 8




                     JACO ELECTRONICS, INC. AND SUBSIDIARIES
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS


Statements  in this filing,  and  elsewhere,  which look forward in time involve
risks and uncertainties  which may effect the actual results of operations.  The
following  important  factors,  among others,  have affected and, in the future,
could affect the Company's  actual  results:  dependence on a limited  number of
suppliers for products  which  generate a  significant  portion of the Company's
sales, the effect upon the Company of increases in tariffs or duties, changes in
trade  treaties,  strikes or delays in air or sea  transportation  and  possible
future United States legislation with respect to pricing and/or import quotas on
products  imported  from foreign  countries,  and general  economic  effect upon
manufacturers,  end users of  electronic  components  and  electronic  component
distributors.


GENERAL

Jaco  is a  distributor  of  electronic  components  and  provider  of  contract
manufacturing  and value-added  services.  Products  distributed by Jaco include
semiconductors,  capacitors, resistors, electromechanical devices and flat panel
displays (FPDs) used in the assembly and manufacturing of electronic equipment.

The Company's customers are primarily small and medium sized manufacturers.  The
trend for these customers has been to shift certain  manufacturing  functions to
third parties  (outsourcing).  The Company intends to seek to capitalize on this
trend toward outsourcing by increasing sales of products enhanced by value-added
services. Value-added services currently provided by Jaco consist of configuring
complete computer systems to customer  specifications  both in tower and desktop
configurations, kitting (e.g. supplying sets of specified quantities of products
to a customer that are prepackaged for ease of feeding the customer's production
lines), and contract  manufacturing  services through the Company's wholly-owned
subsidiary, Nexus Custom Electronics, Inc.










<PAGE>


Form 10-Q                                             September 30, 1997
Page 9


COMPARISON OF THE THREE MONTHS ENDED SEPTEMBER 30, 1997 AND SEPTEMBER 30, 1996


Net sales for the first  quarter of fiscal 1998  decreased  approximately  4% to
$36.9 million as compared to $38.3 million for the first quarter of fiscal 1997.
The Company was affected by the continued  industry wide  competitive  pressures
resulting in reduction of the unit prices of certain electronic components.  The
Company  believes that to increase  sales in future  periods it needed to expand
its semiconductor management group, flat panel display division and increase the
field application engineer program.

Gross profit  margins,  as a percentage  of the net sales  remained  constant at
21.2% for the quarter ended  September 30, 1997 as compared to the quarter ended
September  30, 1996.  The Company was able to maintain  its margins  despite the
reductions in component pricing during the quarter.

Selling,  general and  administrative  (SG&A) expenses increased to $6.9 million
for  the  first  quarter  of  fiscal  1998,  an  increase  of  $.3  million,  or
approximately  4.3% compared to the $6.6 million for the first quarter of fiscal
1997. The increase was a result of the expanded  programs  previously stated and
the additional  costs  associated with the  acquisitions of Q.P.S.  Electronics,
Inc. and Corona  Electronics,  Inc. These increases were partially offset during
the  current  quarter by  reducing  certain  administrative  costs and  non-core
personnel.

Interest expense  increased to $272,000 for the three months ended September 30,
1997 as compared to $200,000 for the three months ended  September 30, 1996. The
increase was primarily attributable to the increased borrowings of approximately
$4.5 million  attributed to the fiscal 1997 acquisitions of Q.P.S.  Electronics,
Inc.  and  Corona  Electronics,  Inc.  (see note A-6 of the  notes to  condensed
consolidated financial statements).

Net earnings for the three months ended  September  30, 1997 were  $398,000,  or
$.10 per share as compared to  $788,000,  or $.20 per share for the three months
ended  September 30, 1996. The decrease in net earnings was  attributable to the
decrease in sales and the increase in SG&A  expenses  incurred in pursuit of the
initiatives to expand the  semiconductor  management  group,  flat panel display
division,  field  application  engineer  program and the  acquisition  of Corona
Electronics, Inc. and Q.P.S. Electronics, Inc.


LIQUIDITY AND CAPITAL RESOURCES

The Company's agreement with its banks, as amended,  provides the Company with a
$30,000,000 term loan and revolving line of credit facility based principally on
eligible  accounts  receivable and  inventories of the Company as defined in the
agreements expiring September 13, 2000. Effective June 1, 1997, borrowings under
the credit  facility bear interest at the average  30-day LIBOR rate plus 1%. As
of January 1, 1998,  interest is based on the average  daily  30-day  LIBOR rate
plus  3/4%  to 1 1/4%  depending  on the  Company's  performance  measured  by a
financial ratio.  The applicable  interest rate may be adjusted  quarterly.  The
outstanding  balance on the revolving line of credit facility was $13,988,944 at
September 30, 1997.


<PAGE>


Form 10-Q                                             September 30, 1997
Page 10



The term loan,  with a  remaining  balance of $750,000 at  September  30,  1997,
requires monthly principal  payments of $17,857,  together with interest through
September  13, 1998,  with a final  payment of $533,600 on  September  13, 1998.
Borrowings under this facility are  collateralized  by substantially  all of the
assets of the Company.  The agreement  contains  provisions  for  maintenance of
certain  financial  ratios,  all of which the Company is in  compliance  with at
September 30, 1997, and prohibits the payment of cash  dividends.  The agreement
also  provides  for the  issuance  of  letters  of  credit  by the  banks on the
Company's behalf. At September 30, 1997, $500,000 of such letters of credit were
outstanding.

For the three months ended  September 30, 1997,  the Company's net cash provided
by  operating  activities  was  $391,000  as  compared  to net cash  provided by
operating  activities  of  $1,725,000  for the three months ended  September 30,
1996.  The  decrease is primarily  attributable  to the increase in inventory of
$1,046,000  compared to a reduction in accounts receivable and inventory (net of
assets acquired from business  acquisitions)  during the first quarter of fiscal
1997. Net cash used in investing  activities decreased to $267,000 for the first
quarter of fiscal  1998,  as compared  to  $1,588,000  for the first  quarter of
fiscal 1997. The acquisition during fiscal 1997 required  $1,240,000,  which was
financed substantially through additional borrowings under the Company's line of
credit.  The Company's cash  expenditures  may vary  significantly  from current
levels,  based on a number of factors,  including,  but not  limited to,  future
acquisitions, if any.

For the first  quarter of fiscal 1998 and 1997  inventory  turnover was 3.4x and
4.0x,  respectively.  The  average  of  the  Company's  accounts  receivable  at
September 30,1997 was 55 days, as compared to 53 days at September 30,1996.  The
Company did not experience any significant trade collection  difficulties during
the first quarter of fiscal 1998.

On April 15, 1996, the Company's  Board of Directors  authorized the purchase of
up to  250,000  shares of its  common  stock or  approximately  6.3% of the then
outstanding shares,  under a stock repurchase  program.  During fiscal 1997, the
Company repurchased 87,500 shares at an average market price of $8.00 per share.

The Company  believes that cash flow from  operations and funds  available under
its credit  facility will be sufficient to fund the Company's  capital needs for
at least the next twelve months.

INFLATION

Inflation has not had a significant  impact on the Company's  operations  during
the last three fiscal years.


<PAGE>


FORM 10-Q                                             September 30, 1997
Page 11




PART II - OTHER INFORMATION


Item 1.     Legal Proceedings

                  Nothing to Report

Item 2.     Changes in Securities

                  Nothing to Report

Item 3.     Defaults Upon Senior Securities

                  Nothing to Report

Item 4.     Submission of Matters to a Vote of Security Holders

                  Nothing to Report

Item 5.     Other Information

                  Nothing to Report

Item 6.     Exhibits and Reports on Form 8-K

                  a)     Exhibits:

                     27.      Financial Data Schedule

                     99.8.2   Amendment to Loan and Security
                              Agreement
                  
                   b)   Reports on Form 8-K: None



<PAGE>



                                S I G N A T U R E




      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.


                                          JACO ELECTRONICS, INC.
                                             (Registrant)



                                        BY: /s/ Jeffrey D. Gash
                                        ________________________________________
                                        Jeffrey D. Gash, Vice President/Finance
                                        (Principal Financial Officer)



DATED:  November 12, 1997