<PAGE>
 
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

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

                                   FORM 10-Q


(Mark One)

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934
 
     For the Quarter Ended February 28, 1998

                                       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 0-21921

                            TEMPLATE SOFTWARE, INC.
            (Exact name of registrant as specified in its charter)

<TABLE> 
<S>                                             <C>
                  VIRGINIA                          52-1042793
       (State or other jurisdiction of           (I.R.S. Employer
        incorporation or organization)          Identification No.)


           45365 VINTAGE PARK PLAZA
               DULLES, VIRGINIA                        20166
    (Address of principal executive offices)         (Zip code)
</TABLE> 

                                (703) 318-1000
             (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        
                               -----         -----

     Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.

<TABLE> 
<CAPTION> 
                                                   Outstanding at
       Class of Common Stock                       March 31, 1998
       ---------------------                       --------------
       <S>                                         <C>
       Common Stock, $.01 par value per share         4,987,475
</TABLE> 
<PAGE>
 
                            TEMPLATE SOFTWARE, INC.
                                     INDEX
                                     -----
                           
<TABLE>
<CAPTION>
                                                                           Page
                                                                           ----
<S>                                                                        <C>
PART I - FINANCIAL INFORMATION       
 
Item 1.  Financial Statements

             Consolidated Balance Sheets                                     3

             Consolidated Statements of Operations                           4

             For the  Three Months Ended February 28,                        4

             Consolidated Statements of Cash Flows                           5

             Notes to the Consolidated Statements                            6

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

Item 2.  Changes in Securities.                                             10

Item 6.  Exhibits and Reports on Form 8-K.                                  10

             Signatures                                                     11
</TABLE>

          This Form 10-Q contains certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended (the
"Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as
---------------                                                              
amended (the "Exchange Act"), which are intended to be covered by the safe
              ------------                                                
harbors created thereby.  Investors are cautioned that all forward-looking
statements involve risks and uncertainty, including without limitation, the
ability of the Company to develop its products, as well as general market
conditions, competition and pricing.  Although the Company believes that the
assumptions underlying the forward-looking statements contained herein are
reasonable, any of the assumptions could be inaccurate, and therefore, there can
be no assurance that the forward-looking statements included in this Form 10-Q
will prove to be accurate.  In light of the significant uncertainties inherent
in the forward-looking statements included herein, the inclusion of such
information should not be regarded as a representation by the Company or any
other person that the objectives and plans of the Company will be achieved.

                                       2
<PAGE>
 
                                     PART I
                             FINANCIAL INFORMATION
                             ---------------------

ITEM 1.  FINANCIAL STATEMENTS.

                    TEMPLATE SOFTWARE, INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                             (AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
                                                   FEBRUARY 28, 1998     NOVEMBER 30, 1997    
                                                                             (AUDITED)        
                                                   ---------------------------------------    
<S>                                                <C>                   <C>                  
ASSETS                                                                                        
Current assets:                                                                               
 Cash and cash equivalents                              $ 4,594              $ 2,739          
 Marketable securities                                    9,958               13,318          
 Accounts receivable, net                                11,152               10,474          
 Income tax receivable                                      496                  236          
 Deferred income taxes                                      734                  406          
 Prepaid expenses and other current assets                1,058                  689          
                                                   ---------------------------------------    
  Total current assets                                   27,992               27,862          
Property and equipment, net                               2,358                2,194          
Software development costs, net                           1,723                1,491          
Goodwill, net                                            10,533               10,710          
Deferred income taxes                                       408                  408          
Other assets                                                314                  306          
                                                   ---------------------------------------    
   Total assets                                         $43,328              $42,971          
                                                   =======================================    
                                                                                              
LIABILITIES AND SHAREHOLDERS' EQUITY                                                          
                                                                                              
Current liabilities:                                                                          
 Accounts payable and accrued expenses                  $ 3,746              $ 4,149                                  
 Current portion of long-term debt                          321                  179                                      
 Income taxes payable                                        95                   35                                       
 Deferred income                                            763                  795                                      
                                                   ---------------------------------------    
  Total current liabilities                               4,925                5,158                                    
                                                   ---------------------------------------    
Long-term liabilities:                                                                        
 Long-term debt, net of current portion                     297                  211                                      
 Other long-term liabilities                                322                  309                                      
                                                   ---------------------------------------    
  Total liabilities                                       5,544                5,678          
                                                   ---------------------------------------    
                                                                                              
Shareholders' equity:                                                                         
Common Stock, $0.01 par value                                49                   47          
Additional paid-in capital                               34,767               33,911          
Foreign currency translation                                (58)                  49          
Retained earnings                                         3,026                3,286          
                                                   ---------------------------------------    
 Total shareholders' equity                              37,784               37,293          
                                                   ---------------------------------------    
  Total liabilities and shareholders' equity            $43,328              $42,971           
                                                   =======================================    
</TABLE>

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL
STATEMENTS.

                                       3
<PAGE>
 
                   TEMPLATE SOFTWARE, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
            (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AND SHARE DATA)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                      FOR THE  THREE MONTHS ENDED FEBRUARY 28,
                                                            1998                    1997
                                                      ---------------------------------------
<S>                                                     <C>                      <C>
Revenues:                                                          
  Products                                              $    1,309               $    1,489
  Services                                                   6,901                    2,465
                                                      ---------------------------------------
    Total Revenues                                           8,210                    3,954
                                                      ---------------------------------------
Cost of revenues:                                                                
  Products                                                     403                      182
  Services                                                   4,619                    1,467
                                                      ---------------------------------------
    Total cost of revenues                                   5,022                    1,649
                                                      ---------------------------------------
Gross profit                                                 3,188                    2,305
                                                      ---------------------------------------
                                                                                 
Operating expenses:                                                              
  Selling and marketing                                      2,165                      824
  Product development                                          354                      326
  General and administrative                                 1,276                      633
                                                      ---------------------------------------
    Total operating expenses                                 3,795                    1,783
                                                      ---------------------------------------
Income (loss) from operations                                 (607)                     522
  Interest expense                                              28                       13
  Other income                                                 182                      137
                                                      ---------------------------------------
Net income (loss) before income taxes                         (453)                     646
Income tax provision (benefit)                                (193)                     239
                                                      ---------------------------------------
Net income (loss)                                       $     (260)              $      407
                                                      =======================================
Earnings (loss) per share - basic                       $    (0.05)              $     0.14
                                                      =======================================
Shares used in computing basic earnings                            
 (loss) per share                                        4,762,180                2,905,550 
                                                      =======================================
Earnings (loss) per share - diluted                     $    (0.05)              $     0.08
                                                      =======================================
Shares used in computing diluted                                   
 earnings (loss) per share                               4,762,180                4,979,755 
                                                      =======================================
</TABLE>

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL
STATEMENTS.

                                       4
<PAGE>
 
                   TEMPLATE SOFTWARE, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                            (AMOUNTS IN THOUSANDS)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                          FOR THE THREE MONTHS ENDED FEBRUARY 28,
                                                              1998                      1997
                                                          ---------------------------------------
<S>                                                        <C>                       <C>
Cash flows provided by (used in) by                        
 operating activities                                         (1,759)                       79 
                                                          ---------------------------------------
Cash flows from investing activities:
  Proceeds from sales and maturities of                       
   marketable securities                                       3,367                   (14,461) 
  Capital expenditures and leasehold improvements               (380)                     (135)
  Capitalization of software development costs                  (346)                     (211) 
                                                          ---------------------------------------
    Net cash provided by (used in) in                                    
     investing activities                                      2,641                   (14,807) 
                                                          ---------------------------------------
Cash flows from financing activities:
  Revolving credit facility, net                                  (5)                       --
  Note payable, net                                              236                       (23)
  Payments on capital lease obligations                          (13)                      (12)
  Income tax benefit related to stock options                    313                        -- 
  Proceeds from issuance of capital                             
   stock, net of issuance costs                                  448                    19,953 
                                                          ---------------------------------------
    Net cash provided by (used in)                              
     financing activities                                        979                    19,918 
                                                          ---------------------------------------
Effect of exchange rate changes on cash                         
 and cash equivalents                                             (6)                      (21) 
                                                          ---------------------------------------
Net increase in cash and cash equivalents                      1,855                     5,169 
Cash and cash equivalents, beginning of period                 2,739                     8,397
                                                          ---------------------------------------
Cash and cash equivalents, end of period                       4,594                    13,566
Marketable securities, end of period                           9,958                    14,461
                                                          ---------------------------------------
Cash, cash equivalents and marketable
 securities, end of period                                    14,552                    28,027
                                                          =======================================
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL
STATEMENTS.

                                       5
<PAGE>
 
                            TEMPLATE SOFTWARE, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               FEBRUARY 28, 1998

NOTE A -- BASIS OF PRESENTATION

          In the opinion of management, the accompanying unaudited consolidated
financial statements of Template Software, Inc. and subsidiaries (the "Company")
                                                                       -------  
contain all adjustments (consisting only of normal recurring accruals) necessary
to present fairly the Company's consolidated financial position as of 
February 28, 1998, and the results of operations and cash flows for the periods
indicated. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. It is suggested that these condensed
consolidated financial statements be read in conjunction with the financial
statements and notes thereto included in the Company's 1997 Annual Report on
Form 10K. The results of operations for the three months ended February 28, 1998
are not necessarily indicative of the operating results to be expected for the
full year.

NOTE B - ACQUISITIONS AND STRATEGIC VENTURES

MILESTONE SOFTWARE GES. MBH.

          On March 30, 1998, the Company acquired the remaining 56% of the
issued and outstanding equity interests of milestone software Ges. mbH, an
Austrian corporation ("Milestone-Austria"), from Milestone-Austria's three
                       -----------------                                  
owners for an aggregate cash purchase price of $100,000.  The acquisition
agreement also provides for additional contingent consideration not to exceed
$250,000 of equivalent shares of common stock to all of the selling shareholders
if certain revenue and profit objectives are met by the Company's fiscal year
end. The acquisition is expected to be accounted for as a purchase.  As a result
of this transaction, the Company owns 100% of Milestone Austria.

PRECISE CONNECTIVITY SOLUTIONS LTD.

          On March 30, 1998, Template entered into a Convertible Note Purchase
Agreement with Precise Connectivity Solutions Ltd. ("Precise"), an Israeli
limited corporation, pursuant to which Template purchased a Note from Precise
for an aggregate purchase price of $500,000.  The Note is convertible at the
option of Template or Precise into that number of fully-paid, non-assessable
shares of Preferred Stock of Precise equal to eight percent (8%) of the issued
and outstanding capital stock of Precise, on a fully-diluted basis, including
such shares of Preferred Stock.

NOTE C - NEW ACCOUNTING PRONOUNCEMENTS

          The financial Accounting Standards Board has issued two new standards
which become effective for reporting periods beginning after December 15, 1997:
SFAS No. 130, Reporting Comprehensive Income and SFAS No. 131, Disclosures about
Segments of an Enterprise and Related Information.  Management believes the
adoption of these statements will not have a material effect on the Company's
financial statements.

          In October 1997, the AICPA issued Statement of Position (SOP) 97-2,
Software Revenue Recognition, which will supersede SOP 91-1 effective January 1,
1998.  Management has assessed this new statement and believes that its adoption
will not have a material effect on the timing of the Company's revenue
recognition or cause changes to the Company's revenue recognition policies.

                                       6
<PAGE>
 
NOTE D - INCOME TAXES

          The Company's effective tax rate of 43% for the quarter ended February
28, 1998 was higher than the effective tax rate of 37% for the quarter ended
February 28, 1997, primarily as a result of the German and French tax rates that
were higher than the effective tax rate of the Company prior to the acquisitions
of the German and French entities.

          The Company recognized a tax benefit of approximately $313,000 from
disqualifying dispositions of stock options for the three months ended February
28, 1998.  The benefit is the difference between the market value of the stock
issued at the time of exercise and the option price tax effected at the
Company's effective tax rate.  This benefit was first applied to federal and
state income taxes payable with the remainder recorded as a deferred tax asset.
In accordance with APB 25, the tax benefit is credited directly to additional
paid in capital.

NOTE E - EARNINGS PER SHARE

          Earnings per share is presented in accordance with SFAS No. 128,
Earnings per Share.  Basic earnings per share is computed by dividing net income
(loss) available to common shareholders by the weighted average number of common
shares outstanding during the period.  Diluted earnings per share is computed by
dividing net income (loss) available to common shareholders by the weighted
average of common shares outstanding after giving effect to all dilutive
potential common shares that were outstanding during the period.  The Company
did not have any dilutive common shares during the three months ended February
28, 1998.  Net income (loss) reported was not adjusted for the computation of
basis or diluted earnings per share.

          The following table reconciles the weighted average number of common
shares outstanding during each period for basic earnings per share with the
comparable amount for diluted earnings per share.

<TABLE>
<CAPTION>
                                                           February 28,
                                                      ----------------------
                                                         1998        1997
                                                      ----------  ----------
<S>                                                   <C>         <C>
     Weighted average shares outstanding - basic       4,762,180   2,905,550
     Potential common shares                                  --   2,074,205
                                                       ---------   ---------
     Weighted average shares outstanding - diluted     4,762,180   4,979,755
                                                       =========   =========
</TABLE>

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

Results of Operations

          Revenue.  Total Revenue was $8.2 million for the quarter ended
February 28, 1998 compared to $4.0 million for the quarter ended February 28,
1997, an increase of $4.2 million or 107.6%.  This growth resulted principally
from volume increases in sales of software-related services and additional
revenue realized from acquisitions consummated after the first quarter of 1997.

          Product Revenue was $1.3 million for the quarter ended February 28,
1998 compared to $1.5 million for the quarter ended February 28, 1997, a
decrease of $0.2 million or 12.1%.  This decrease was primarily attributable to
the timing of orders for licenses.  Services Revenue was $6.9 million for the
quarter ended February 28, 1998 compared to $2.5 million for the quarter ended
February 28, 1997, an 

                                       7
<PAGE>
 
increase of $4.4 million or 180.0%. This increase was primarily attributable to
the implementation of larger scale client engagements for complete solutions and
additional service revenue resulting from acquisitions.

          Cost of Revenue.  Total Cost of Revenue consists primarily of salaries
and related benefits for personnel, and also includes an allocated portion of
rent, building services and computer equipment services and expenses.  Total
Cost of Revenue was $5.0 million for the quarter ended February 28, 1998
compared to $1.6 million for the quarter ended February 28, 1997, an increase of
$3.4 million or 204.5%. This increase was primarily attributable to additional
professional staff hired and or added through acquisition to perform the
increased volume of software services.  Total Cost of Revenue was 61.2% of total
revenue for the quarter ended February 28, 1998 compared to 41.7% of total
revenue for the quarter ended February 28, 1997.  This percentage increase was
primarily attributable to the Company's increase in service revenue with related
lower gross margin.

          Cost of Product Revenue was $0.4 million for the quarter ended
February 28, 1998 compared to  $0.2 million for the quarter ended February 28,
1997, an increase of $0.2 million or 121.4%.  The Cost of Product Revenue
increased in the quarter ended February 28, 1998 due to the consolidation of the
Cost of Product Revenue from the Company's German operation, where the cost of
product revenue consisted primarily of royalties to third party software vendors
which are higher than the Company's cost of its products.  Cost of Services
Revenue was $4.6 million for the quarter ended February 28, 1998 compared to
$1.5 million for the quarter ended February 28, 1997, an increase of $3.1
million or 214.9%.  This increase resulted primarily from the cost associated
with staffing the growth in services contracts.  Because such staffing is
relatively fixed in the short term, if any of the Company's engagements were to
be terminated on short notice, the Company would be unable to reduce Cost of
Services Revenue commensurate with the associated decrease in Services Revenue.
Any such termination would have a material adverse effect on the Company's
business, operating results and financial condition.

          Selling and Marketing.  Selling and Marketing expenses consist
primarily of expenses related to sales and marketing personnel, advertising,
promotion, trade show participation and public relations.  Selling and Marketing
expenses were $2.2 million for the quarter ended February 28, 1998 compared to
$0.8 million for the quarter ended February 28, 1997, an increase of $1.4
million or 162.7%  This increase resulted primarily from the Company's strategic
shift toward direct sales, expenditures related to expanding market awareness of
the Company's products and services, expenditures related to market research
relating to potential new industry templates and the consolidation of sales and
marketing expenditures of the German entity.

          Product Development.  Product Development expenses were $0.4 million
for the quarter ended February 28, 1998  compared to $0.3 million for the
quarter ended February 28, 1997, an increase of $0.1 million or 8.6%. This
increase resulted primarily from the development of enhancements to the
Company's Foundation Template, including the Process Monitor Component and the
Geographic Mapping Components and the development of the Company's new
integration product, Active Information Manager (AIM).  Product Development
expenses in the three-month period ended February 28, 1997 included offsets of
$0.1 million as a result of the Company's participation in a Federal Technology
Reinvestment Program.  The offsets generated by this program ended in the third
quarter of 1997.

          General and Administrative.  General and Administrative expenses
include costs of corporate services functions including accounting, human
resources and legal services, as well as the corporate executive staff.  General
and Administrative expenses were $1.3 million for the quarter ended February 28,
1998 compared to $0.6 million for the quarter ended February 28, 1997 an
increase of $0.7 million or 

                                       8
<PAGE>
 
101.6%. This increase is primarily attributable to an increase in corporate
administrative staff and the goodwill amortization for the French subsidiary
acquired in March 1997 and the German subsidiary acquired in June 1997.

          Income Tax (Benefit) Provision.  The Income Tax Benefit was $0.2 for
the quarter ended February 28, 1998 compared to an Income Tax Provision of 
$0.2 for the quarter ended February 28, 1997. The income tax benefit was
attributable to losses incurred by the Company's foreign operations during the
three-month period ended February 28, 1998. The Company's effective tax rate of
43% for the quarter ended February 28, 1998 was higher than the effective tax
rate of 38% for the quarter ended February 28, 1997, primarily as a result of a
German tax rate that was higher than the effective tax rate of the Company prior
to the German acquisition.

LIQUIDITY AND CAPITAL RESOURCES

          The Company's overall cash and cash equivalents were $4.6 million at
February 28, 1998, which is an increase of approximately $1.9 million from 
$2.7 million as of November 30, 1997. The Company's operating activities used
cash of $1.8 million for the three month period ended February 28, 1998. During
the three month period ended February 28, 1998, cash flow used by operating
activities reflected the net loss, a decrease in accrued expenses and increases
in accounts receivable, income tax receivable, deferred tax benefit and prepaid
expenses which were partially offset depreciation and amortization.

          Cash provided by investing activities totaled $2.6 million during the
three month period ended February 28, 1998 relating primarily to $3.4 million of
proceeds from short-term, investment grade marketable securities with maturities
of less than one year which was partially offset by $0.4 million of capital
expenditures and $0.3 million of software capitalization.

          Cash flow provided from financing activities totaled $1.0 million for
the three month period ended February 28, 1998 primarily relating to the net
proceeds from the issuance of Company's Common Stock under stock programs and
the issuance of a note payable for the Company's directors' and officers'
insurance premium.

          The Company has a line of credit under a Loan and Security Agreement
(the "Loan Agreement") with Signet Bank (the "Bank") in the aggregate principal
      --------------                          ----                             
amount of $3.0 million.  As of February 28, 1998, there were no amounts
outstanding under this line of credit.  The Company has been in compliance with
all financial and non-financial covenants of the Loan Agreement.  In addition,
the Company's French subsidiary maintains an unsecured line of credit with
Banque Hervet for 500,000FF for overdraft protection at an interest rate of
8.3%.  As of February 28, 1998, 170,502FF ($28,996) was outstanding under this
line of credit.

          The Company believes its cash balances, cash generated from operations
and borrowings available under its line of credit, will satisfy the Company's
working capital and capital expenditure requirements for at least the next
twelve months.  In the longer term, the Company may require additional sources
of liquidity to fund future growth.  Such sources of liquidity may include
additional equity offerings or debt financings.  There are no assurances that
such sources of financing will be available to the Company and if they are, that
they will be sufficient to meet the Company's liquidity needs at such time.

                                       9
<PAGE>
 
IMPACT OF YEAR 2000 ISSUE

          The Company is in the process of assessing its computer applications
to ensure their functionality with respect to the "Year 2000" millennium change.
At present, the Company does not anticipate that material incremental costs will
be incurred in any single future year.

                          PART II - OTHER INFORMATION

ITEM 2.  CHANGES IN SECURITIES.

Use of Proceeds

          In the Company's Registration Statement on Form S-1 (Registration 
No. 333-17063) effective January 28, 1997, 1,400,000 shares of Common Stock were
registered for the account of the Company and 700,000 shares of Common Stock
were registered for the accounts of selling security holders with an aggregate
offering price of $16.00 per share registered. The expenses incurred for the
Company's account in connection with the issuance and distribution of the
securities were $1,568,000 of underwriting discounts and commissions and
$1,068,641 of other expenses for a total expense of $2,636,641. The net offering
proceeds for the account of the Company were $19,763,359. From the effective
date of the Registration Statement, through the end date of the period covered
by this report, the Company used $7,356,848 to acquire other businesses,
$9,957,997 to purchase temporary investments in marketable securities and
$2,448,514 remains unused as cash and cash equivalents. There has not been a
material change in the use of proceeds described in the Company's prospectus.

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

          (a)  The following exhibits are filed herewith:
<TABLE>
<CAPTION>
          Exhibit
          Number                            Exhibit Title
          --------  ------------------------------------------------------------
          <S>       <C>
            10.1    Service Agreement between the Company and Richard Collard
                    executed March 20, 1998

            10.2    Share Purchase Agreement dated March 30, 1998 between 
                    the Company and the shareholders of milestone software
                    Ges. mbH/1/

            27.1    Financial Data Schedule for the three month period ended
                    February 28, 1998

            27.2    Restated Financial Data Schedule for the three month period
                    ended February 28, 1997
</TABLE>

          (b)  Reports on Form 8-K

          On April 6, 1998, the Company filed a report on Form 8-K (Commission
file no: 0-21921) regarding the acquisition of the remaining 56% of the issued
and outstanding equity interests of milestone software Ges. mbH.  The
acquisition was consummated on March 30, 1998.

--------------
/1/   Incorporated by reference to the report on Form 8-K (Commission file 
no: 0-21921) filed by the Company on April 6, 1998.

                                       10
<PAGE>
 
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.

Dated:    April 15, 1998            TEMPLATE SOFTWARE, INC.



                                    By: /s/ Kimberly E. Osgood
                                        ------------------------
                                        Kimberly E. Osgood
                                        Chief Financial Officer and
                                        Chief Accounting Officer

                                       11