SECURITIES AND EXCHANGE COMMISSION 
                        Washington, D. C. 20549
                              Form 10-QSB

         [X] QUARTERLY REPORT UNDER SECTION 13 OR 15[d] OF THE 
                    SECURITIES EXCHANGE ACT OF 1934 

             For the quarterly period ended January 31, 1998

     [  ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE 
                           EXCHANGE ACT 

               For the transition period from      to    

                    Commission file number 1-6762

                     KILLEARN PROPERTIES, INC.

    (Exact name of small business issuer as specified in its charter)

   Florida                           59-1095497
  (State or other jurisdiction of   (I.R.S. Employer Identification No.)
   incorporation or organization)

                        100 Eagle's Landing Way
                         Stockbridge, GA  30281
                 (Address of principal executive offices)

                       Issuer's telephone number
                              (770) 389-2020

Check whether the issuer (1) has filed all reports required to be filed 
by Section 13 or 15(d) of the Exchange Act during the past 12 months (or 
for such shorter period that the registrant was required to file such 
reports), and (2) has been subject to such filing requirements for the 
past 90 days. Yes [X] 

State the number of shares outstanding of each of the issuer's classes 
of common equity, as of the last practicable date:  887,412.

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KILLEARN PROPERTIES, INC. AND SUBSIDIARIES
INDEX

Part I.  Financial Information

   Item 1.  Consolidated Condensed Financial Statements (Unaudited):

    Consolidated Condensed Balance Sheet as of January 31, 1998        3

    Consolidated Condensed Statements of Operations for the Nine       4
      Months Ended January 31, 1998 and 1997

    Consolidated Statements of Cash Flows for the Nine Months          5
      Ended January 31, 1998 and 1997

    Notes to Consolidated Condensed Financial Statements               6

   Item 2.  Management's Discussion and 
      Analysis of Financial Condition and Results of Operations        7

Part II  Other Information

   Item 1.  Legal Proceedings                                          9
   Item 4.  Submission of Matters to a Vote of Security Holders        9
   Item 5.  Other Information                                          9
   Item 6.  Exhibits and Reports on Form 8-K                           9

Signatures                                                            10
Exhibit Index                                                         11

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<TABLE>
PART I. FINANCIAL INFORMATION 
ITEM 1. CONSOLIDATED CONDENSED FINANCIAL STATEMENTS 
KILLEARN PROPERTIES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEET

<CAPTION>
ASSETS                                               1/31/98
                                                   (Unaudited)
<S>                                             <C>   
Cash                                            $    261,897
Accounts and notes receivable                      6,666,200
Land contracts receivable, net                       557,428
Real estate held for development and sale         25,395,125
Property under contract for sale                     141,196
Other property, plant and equipment, net             485,393
Other assets                                           3,410
                                                  __________
TOTAL ASSETS                                    $ 33,510,649
                                                  ==========

LIABILITIES AND STOCKHOLDERS' EQUITY

Accounts payable & other liabilities            $  1,885,629
Income taxes payable                               2,197,718
Mortgages & notes payable                         21,372,079
Deferred liabilities                                 116,000
Deferred income taxes                              3,313,236
Deferred profit                                    1,089,050
                                                  __________
TOTAL LIABILITIES                               $ 29,973,712

STOCKHOLDERS' EQUITY

Common stock - par value $.10 per share;
  authorized 6,000,000 shares; issued
  887,412 shares                                $     88,741
Additional paid-in capital                         1,942,998
Retained earnings                                  1,505,198
                                                  __________
TOTAL STOCKHOLDERS' EQUITY                      $  3,536,937
                                                  __________

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY      $ 33,510,649
                                                  ==========
See Notes to Consolidated Condensed Financial Statements
</TABLE>

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<TABLE>
KILLEARN PROPERTIES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
<CAPTION>
                                         Three Months Ended             Nine Months Ended 
                                        1/31/98        1/31/97         1/31/98     1/31/97
                                     (Unaudited)    (Unaudited)      (Unaudited)  (Unaudited)
<S>                                  <C>            <C>              <C>           <C>
INCOME:
 Net sales of land                   $2,743,524     $3,202,738       $11,266,734   $8,798,425
 Sales of residential construction            -              -                 -      155,000
 Interest income                        180,120        137,071           429,705      448,787
 Commission income                            -         62,004            58,383      127,569
 Income from joint ventures                   -              -                -        55,232
 Other revenues                          40,651         18,161           111,618       51,138
                                      __________     _________       ___________   __________
 Total                               $2,964,295     $3,419,974       $11,866,440   $9,636,151

EXPENSES:
 Cost of land sold                    1,980,380      1,864,202       $ 8,377,252   $5,355,698
 Cost of residential construction             -              -                -       179,879
 Commissions and selling expenses       373,118        332,496         1,331,345    1,143,752
 Interest expense                       162,109        143,848           396,478      413,530
 Depreciation                            19,444         25,862            58,328       82,807
 Property taxes                         122,430         67,343           287,075      146,544
 General & administrative costs         257,302        340,744           758,796    1,033,752
                                     __________     __________       ___________   __________
TOTAL EXPENSES                       $2,914,783     $2,774,495       $11,209,274   $8,355,962

Net income before income taxes           49,512        645,479           657,166    1,280,189
Income tax provision                    (18,631)      (242,894)         (247,291)    (486,088)
                                     __________     __________       ___________   __________
NET INCOME                           $   30,881     $  402,585       $   409,875   $  794,101
                                     ==========     ==========       ===========   ==========

NET INCOME PER SHARE                 $      .03     $      .45       $       .46   $      .89
                                     ==========     ==========       ===========   ==========

Weighted average shares outstanding     887,412        887,412           887,412      887,412


<FN>
See Notes to Consolidated Condensed Financial Statements
</FN>
</TABLE>
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<TABLE>
KILLEARN PROPERTIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
                                                         Nine Months Ended
                                                        1/31/98      1/31/97
                                                       --------     --------
                                                       (Unaudited)  (Unaudited)
<S>                                                    <C>          <C>

NET CASH FROM OPERATING ACTIVITIES:                      2,326,764  (2,626,336)
                                                       ___________  __________

CASH FLOWS FROM INVESTING ACTIVITIES:
    Purchase of property and equipment                      (3,654)    (52,171)
    Distributions from joint ventures                       50,000     129,927
                                                       ___________  __________
       Net cash from investing activities                   46,346      77,756

CASH FLOWS FROM FINANCING ACTIVITIES:
    Proceeds from loans                                 16,962,631   9,569,345
    Principal payments on debt                         (19,343,038) (7,057,756)
                                                       ___________  __________
      Net cash from financing activities               ( 2,380,407)  2,511,589
                                                       ___________  __________
NET DECREASE IN CASH                                   (     7,297)    (36,991)

CASH - Beginning of period                                 269,194     160,147
                                                       ___________  __________

CASH - End of period                                   $   261,897  $  123,156
                                                       ===========  ==========

Supplemental Information
Cash Paid:  Interest paid was $1,659,119 and 1,479,702 for fiscal 1997 and
            1998, respectively.
            Income taxes paid were $983,207 and 1,181,492 in fiscal 1997 and
            1998, respectively.
See Notes to Consolidated Condensed Financial Statements
</TABLE>
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PART I. KILLEARN PROPERTIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS 
JANUARY 31, 1998 

NOTE 1.  Basis of Presentation 

The accompanying unaudited consolidated condensed financial statements 
have been prepared in accordance with the instructions for Form 10-QSB
and, therefore, do not include all information and footnotes necessary
for a fair presentation of financial position, results of operations
and changes in financial position in conformity with generally accepted
accounting principles. 

The information furnished reflects all adjustments which are, in the 
opinion of management, necessary for a fair statement of the results for 
the interim period covered.  For further information, refer to the 
complete consolidated financial statements and footnotes thereto 
included in the Company's annual report on Form 10-KSB for the year 
ended April 30, 1997.

NOTE 2.  Transfer of Assets

On August 1, 1996, the Company entered into an agreement, subject to
shareholder approval, pursuant to which it agreed to transfer certain
of its assets and liabilities to J.T. Williams, Jr., the Company's 
former Chairman of the Board and Chief Executive Officer, in exchange 
for the 551,321 shares of common stock he held in the Company and the 
cancellation of his option to purchase an additional 100,000 shares of 
common stock.  The net assets identified in the agreement consisted 
principally of the Eagle's Landing Golf Course and Country Club, the Inn 
at Eagle's Landing, a note for approximately $2 million and 
approximately 250 acres of commercial and industrial real estate, and 
certain mortgages and other liabilities, as more fully described in the 
Company's proxy statement filed on August 26, 1996 Such transfer, once 
approved, was agreed to be effective as of May 1, 1996.  Accordingly, 
the net cash flows related to the transferred assets from the effective 
date (May 1, 1996) until the closing date would be transferred to or 
funded by J.T. Williams, Jr.

On September 30, 1996, the shareholders of the Company (excluding J.T. 
Williams, Jr.) voted on and approved the transfer agreement, and the 
transfer closed on November 16, 1996. The net assets transferred had a 
historical cost basis of approximately $17,136,000 which has been 
reflected as a reduction to shareholders' equity in the accompanying 
balance sheet.  The net operating results of the transferred assets have 
been removed from the statement of operations retroactively to the 
effective date and have not been considered in the determination of net 
income of the Company.


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NOTE 3  Earnings per share

Earnings per share reflect the weighted average shares outstanding 
during each of the periods presented as reflected on the face of the 
income statement.  As discussed in Note 2, the Company entered into an 
agreement to transfer certain net assets in exchange for 551,321 shares 
and the cancellation of an option to purchase 100,000 shares of the 
Company's common stock.  Based on the effective date of that agreement,
 earnings per share are computed based on the number of shares 
outstanding during the period as if such shares were transferred on the 
effective date.

NOTE 4  Financing

The Company obtained various additional credit facilities during the 
nine month period ending January 31, 1998.  One such facility of 
approximately $2.4 million is being used for the acquisition 
of a First Mortgage on approximately 1,000 acres of land in Henry 
County, Georgia.  The principal amount of this loan has been reduced to 
$441,000.00 by January 31, 1998.  Additional borrowings were for the 
financing of development costs under various development loans.  These 
loans generally mature as the related lots are sold and bear interest 
rates at prime rate plus 1 to 1 1/4 percent.

The Company modified its loan agreement with Killearn, Inc.  The 
modification provided additional borrowing of approximately $1.2 million 
dollars, for a total outstanding principal balance at January 31, 1998 
of $3,320,085.02.  The maturity date was extended to December 31, 1999.  
J.T. Williams, a director of the company, is also the President of 
Killearn, Inc.  Likewise, David K. Williams, the Company's President and 
Director is also a Director and shareholder of Killearn, Inc.

Additionally, on July 10, 1997, the Company modified its loan agreement 
with a bank involving its Georgia operations.  The agreement provides 
for interest to be paid at the bank's prime rate plus 1.25% per annum, 
and matures on July 9, 1998.  The loan is collateralized by first 
mortgages on substantially all the undeveloped land in the Company's 
Georgia property.  Upon the sale of collateralized property, release 
prices, which vary with the development, are applied against the loan 
balance owed to the bank.  The Company historically secures development 
loans from other lenders in an amount sufficient to pay the release 
price and all development costs, which are ultimately satisfied with 
proceeds from the sale of the properties.

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

Results of Operations

Net sales of land decreased approximately $459,214 (14%) during the
current three month period and increased $2.4 million (24%) during the 
current nine month period compared to the same period a year ago.  The 
primary reason for the decrease in the current quarter was a reduction in 
bulk sales from the prior year.  The primary reason for the increase in the 
current nine month period was a result of the Company's increase in commercial
and bulk sales and the recognition of income related to the sale of 
substantially all of the Company's Florida assets in November 1993, 
as reported in the first quarter of the current year. 

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Cost of land sold, as a percentage of net sales of land, was 72% for 
the current three month period compared to 55% for the same period a 
year ago.  Cost of land sold for the current nine month period 
increased to 71% compared to 56% for the same period a year ago.  
These decreases in gross margins are due to the sales at discounted 
prices made in the current year on the commercial and bulk sales of 
land.  The Company's current sales policy provides for increased retail 
sales and less bulk sales at discounted prices in the future.

Interest income increased approximately $43,049 during the current three 
month period and decreased marginally during the current nine month 
period compared to the same periods a year ago.  The 
current quarter increase was due to the purchase of a $3.4 million 
dollar first mortgage on property located in Henry County, Georgia.

Commission income decreased approximately $62,004 in the current three 
month period and $69,186 in the current nine month period compared to 
the same periods a year ago.  Additionally, commission and selling 
expenses decreased approximately $12,378 in the current three month 
period and increased $134,593 in the current nine month period due to 
increased net land sales.  These overall changes resulted from the 
Company's sales program that encouraged homebuilders in the Company's
Communities to sell their homes through brokers other than the Company.
This sales program has been discontinued.

Interest expense, when compared to the same period a year ago, increased 
approximately $18,261 for the current three month period and $17,052 for 
the current nine month period.  This increase is due to certain interest 
expense incurred by the Company not being eligible for capitalization in 
accordance with Financial Accounting Standard 34. 

General and administrative expenses decreased approximately $83,442 in 
the current three month period and $224,956 in the current nine month 
period when compared to the same periods a year ago.  This decrease is 
due to reduction of life insurance premiums and salary to the 
Company's former Chief Executive Officer and other employees as a result 
of the transaction described in Note 2 to the Company's financial 
statements.

The operating statements for the current three month period are not 
necessarily indicative of the results expected for the year.

Liquidity and Capital Resources

The Company finances its operations with operating cash flow and bank 
borrowings.  On January 31, 1998 the Company had available lines of 
credit of approximately $1.5 million which may be drawn as needed for 
the development of the Company's property and other working capital 
needs.  The Company continues to look for additional sources of lines of 
credit and other  financing alternatives and believes that such sources 
are available on acceptable terms when the need for additional financing 
arise.

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</PAGE>

On July 10, 1997, the Company modified its loan agreement with a bank 
involving its Georgia operations.  The agreement provides for interest 
to be paid at the bank's prime rate plus 1.25% per annum, and matures on 
July 9, 1998.  The loan is collateralized by first mortgages on 
substantially all the undeveloped land in the Company's Georgia 
property.  Upon the sale of collateralized property, release prices, 
which vary with the development, are applied against the loan balance 
owed to the bank.  The Company historically secures development loans 
from other lenders in an amount sufficient to pay the release price and 
all development costs, which are ultimately satisfied with proceeds from 
the sale of the properties.

In addition, the Company has other debt maturing in the amount of 
approximately $1.5 million in fiscal 1998 and $19.3 million in the 
following fiscal year.  The Company anticipates that these obligations 
will be paid with the proceeds of land sales from normal operations, 
extension of debt or new borrowings.

Recent Developments

The Company entered into an agreement on February 2, 1998 whereby the
Company deeded three parcels of land and three joint venture properties
to Proactive Technologies, Inc. ("Proactive").  Proactive was a major
shareholder of the Company, and Proactive's Chairman and President was
the Chairman and President of the Company until recently.  The Company
had made demand on Proactive Technologies, Inc. to pay three notes
which were in default totaling $4.9 million, including past due
interest through December 31, 1997.  Under the agreement, Proactive
Technologies paid approximately $1.5 million to reduce the Company's
debt.  The Company agreed to extend until December 31, 1999 the due
date on approximately $3 million balance of Proactive Technologies debt,
which will bear interest at 10% per annum, payable quarterly.
The Company also sold to Proactive three parcels of land and its interest
in three joint ventures for $4.4 million, which is slightly higher than the
book value of these assets.  Proactive Technologies will assume the 
outstanding bank debt secured by these assets, together with all contracts
and other obligations related to these projects incurred after December
31, 1997, the result of which significantly improved the Company's 
liquidity by reducing its debt by approximately $5.9 million.


PART II - OTHER INFORMATION 

ITEM 1.
LEGAL PROCEEDINGS

NONE

ITEM 4.
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

NONE

ITEM 5.
OTHER INFORMATION

NONE

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ITEM 6.
EXHIBITS AND REPORTS ON FORM 8-K
  (a) Exhibits
      The following exhibit is being filed with this report:

      Exhibit No.       Description
      -----------       -----------
      27                Financial Data Schedule
  (b) Reports on Form 8-K

The Company filed Form 8-K for Change in Control of Registrant and 
Disposition of Assets on February 2, 1998.



SIGNATURES 

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


                                         KILLEARN PROPERTIES, INC. 
                                         (Registrant)

Date:  March 17, 1998                    /s/ David K. Williams
                                         _________________________
                                         DAVID K. WILLIAMS 
                                         President








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                             EXHIBIT INDEX

                 Exhibit No.        Description          Page No.
                 -----------        -----------          --------

                    27        Financial Data Schedule      12