U.S. 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                                August 31, 1997
                              --------------------------------------------------
       [ ] TRANSITION REPORT UNDER SECTION 13 OF 15(d) OF THE EXCHANGE ACT

For the transition period from                    to
                              --------------------  ----------------------------

                        Commission File Number 000-21623

                             OBIE MEDIA CORPORATION
       -----------------------------------------------------------------
       (Exact name of small business issuer as specified in its charter)

            OREGON                                               93-0966515
-------------------------------                              -------------------
(State or other jurisdiction of                              (IRS Employer
incorporation or organization)                               Identification No.)


                   4211 West 11th Ave., Eugene, Oregon 97402
                   -----------------------------------------
                    (Address of principal executive offices)

     541-686-8400                                          FAX 541-345-4339
--------------------------------------------------------------------------------
                           (Issuer's telephone number)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act  during  the past 12 months  (or 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 [ ].

     As of September  30, 1997,  3,505,000  shares of the issuer's  common stock
were outstanding. 

     This report contains 8 pages. There are three exhibits.







<PAGE>
                             OBIE MEDIA CORPORATION

                           Consolidated Balance Sheets


                                     ASSETS
                                                August 31,       November 30,
                                                1997                 1996   
Current assets:                               (Unaudited)

   Cash                                      $     44,882      $    474,940
   Accounts receivable, net                     2,371,037         1,550,193
   Deferred tax assets                            313,438           709,000
   Other current assets                           772,122           812,450
                                             -------------     -------------
         Total current assets                   3,501,479         3,546,583

Property and equipment, net                     9,134,574         8,458,014
Deferred tax assets                               380,000           380,000
Other assets                                      219,477           147,987
                                             -------------     -------------

         Total assets                        $ 13,235,530      $ 12,532,584
                                             =============     =============


                      LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:

   Line of credit                            $    885,457      $       -
   Current portion of long-term debt              842,210           743,973
   Accounts payable                               350,711           757,020
   Accrued expenses                             1,064,680         1,070,440
   Deferred revenue                               692,660           595,302
                                             -------------     -------------

         Total current liabilities              3,835,718         3,166,735

Long-term debt, less current portion            5,920,926         6,554,587
                                             -------------     -------------

         Total liabilities                      9,756,644         9,721,322
                                             -------------     -------------

Minority interest in subsidiary                    39,203            27,407
                                             -------------     -------------

Shareholders' equity:

Preferred stock, without par value, 
     10,000,000 shares, authorized, 
     no shares issued and outstanding                -                  -

Common stock, without par value; 
     20,000,000 shares authorized, 
     3,505,000 shares issued and 
     outstanding                                6,176,575          6,161,992
Accumulated deficit                            (2,736,892)        (3,378,137)
                                             -------------      -------------

         Total shareholders' equity             3,469,683          2,783,855
                                             -------------      -------------

         Total liabilities and 
               shareholders' equity          $ 13,235,530       $ 12,532,584
                                             =============      =============


See accompanying notes

<PAGE>
<TABLE>
<CAPTION>
                             OBIE MEDIA CORPORATION
                        Consolidated Statements of Income



                                          Three Months Ended                   Nine Months Ended
                                     August 31,       August 31,          August 31,       August 31,

                                        1997             1996                1997             1996
                                   --------------   ---------------     --------------   --------------
Revenues:                                    (Unaudited)                         (Unaudited)
<S>                                <C>              <C>                 <C>              <C>
  Outdoor advertising              $   1,378,664    $    1,162,096      $   3,928,437    $   3,455,515
  Transit advertising                  2,663,737         1,597,800          5,896,053        4,104,060
  Less agency commissions               (365,983)         (216,187)          (840,489)        (580,736)
                                   --------------   ---------------     --------------   --------------

         Net revenues                  3,676,418         2,543,709          8,984,001        6,978,839

Operating expenses:

   Direct advertising expenses         2,265,809         1,501,604          5,333,420        4,144,062
   General and administrative            563,330           305,434          1,512,282          957,245
   Start up costs                         76,390               --             230,067              --
   Depreciation and amortization         159,497           141,602            477,961          423,570
                                   --------------   ---------------     --------------   --------------

         Operating income                611,392           595,069          1,430,271        1,453,962

Other income                             (11,000)            6,283            (51,492)        (193,294)
Interest expense                         134,370           399,480            424,970        1,109,942
Minority interest in subsidiary             (725)           (1,925)            11,949           20,591
                                   --------------   ---------------     --------------   --------------
         Income before income taxes      488,747           191,231          1,044,844          516,723

Provision for income taxes              (187,923)          (13,297)          (403,599)         (23,897)
                                   --------------   ---------------     --------------   --------------

         Net income                $     300,824    $      177,934      $     641,245    $     492,826
                                   ==============   ===============     ==============   ==============


Net earnings per share                $    0 .09         $    0.07          $    0.18        $    0.20

Weighted average number of common
shares outstanding                     3,502,880         2,500,000          3,503,698        2,500,000
                                   ==============   ===============     ==============   ==============

</TABLE>

See accompanying notes






<PAGE>
<TABLE>
<CAPTION>
                             OBIE MEDIA CORPORATION
                      Consolidated Statements of Cash Flows



                                         Three Months Ended               Nine Months Ended
                                      August 31,     August 31,        August 31,     August 31,
                                        1997           1996              1997           1996
                                    -------------   ------------      ------------   ------------
                                            (Unaudited)                       (Unaudited)
<S>                                 <C>            <C>               <C>             <C>
Cash flows from operating activities:

     Net income                     $    300,824   $    177,934      $    641,245    $   492,826

       Adjustments to reconcile net
       income to net cash provided
     by operating activities:

      Depreciation and amortization      159,497        141,602           477,961        423,570
      Changes in operating assets
         and liabilities                (491,083)      (165,811)         (808,276)      (427,872)
                                    -------------   ------------      ------------   ------------

         Net cash provided by
            operating activities         (30,762)       153,725           310,930        488,524
                                    -------------   ------------      ------------   ------------

Cash flows from investing activities:

   Capital expenditures                 (313,121)      (198,621)       (1,117,401)      (785,684)
   Proceeds from asset
         dispositions                       -0-            -0-               -0-         235,700
                                    -------------   ------------      ------------   ------------
         Net cash used in
            investing activities        (313,121)      (198,621)       (1,117,401)      (549,984)
                                    -------------   ------------      ------------   ------------

Cash flows from financing activities:

   Payments on long-term debt           (198,544)      (208,333)         (535,423)      (572,558)
    Credit line borrowing                822,721           -0-            885,456           -0-
   Other financing activities           (235,412)       216,329            26,380        597,118
                                    -------------   ------------      ------------   ------------

         Net cash provided by
             financing activities        388,765          7,996           376,413         24,560
                                    -------------   ------------      ------------   ------------


Net increase (decrease) in cash           44,882        (36,900)         (430,058)       (36,900)
Cash , beginning of period                  -0-            -0-            474,940         54,568
                                    -------------   ------------      ------------   ------------

Cash, end of period                 $     44,882    $   (36,900)      $    44,882    $    17,668
                                    =============   ============      ============   ============

</TABLE>
See accompanying notes

<PAGE>
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.  Basis of Presentation

The interim  financial  statements have been prepared by Obie Media  Corporation
(the "Company")  without audit. In the opinion of management,  the  accompanying
unaudited  financial  statements  contain all  adjustments  necessary to present
fairly the  financial  position  of the Company as of August 31,  1997,  and the
results of  operations  and cash flows of the Company  for the three  months and
nine  months  ended  August  31,  1997  and  August  31,  1996.   The  condensed
consolidated  financial  statements  include the accounts of the Company and its
subsidiary, and all significant intercompany accounts and transactions have been
eliminated in consolidation.

Certain  information  and footnote  disclosures  normally  included in financial
statements prepared in accordance with generally accepted accounting  principles
have been  condensed  or omitted as permitted  by rules and  regulations  of the
Securities  and  Exchange  Commission.  The  organization  and  business  of the
Company,  accounting  policies followed by the Company and other information are
contained in the notes to the Company's  financial  statements  filed as part of
the Company's  November 30, 1996 Form 10-KSB.  This  quarterly  report should be
read in conjunction with such annual report.


2.  Long-Term Borrowings

The  Company's  Term  Loan  Agreement   contains  certain  covenants   including
maintenance  of cash flow  coverage.  The Company was in  compliance  with these
covenants as of August 31, 1997.


3.    Income Per Share

Income per common  share is computed on the  weighted  average  number of common
shares outstanding during the period after  consideration of the dilutive effect
of stock options.
<TABLE>
<CAPTION>
                                         Three Months Ended                        Nine Months Ended
                                  August 31, 1997    August 31, 1996       August 31, 1997     August 31, 1996
                                  ---------------    ---------------       ---------------     ---------------
<S>                               <C>                <C>                   <C>                 <C>      
Issued  and outstanding shares         3,502,880          2,500,000             3,500,967           2,500,000
     (weighted average)
Stock Options                                -                  -                   2,731                 -
                                  ---------------    ---------------       ---------------     ---------------
                                       3,502,880          2,500,000             3,503,698           2,500,000
                                  ===============    ===============       ===============     ===============
</TABLE>

4.    Newly Issued Financial Accounting Pronouncements

In February 1997, the Financial  Accounting  Standards Board issued Statement of
Financial  Accounting  Standards  ("SFAS") NO. 128,  "Earnings  Per Share." This
standard revises the disclosure  requirements of earnings per share,  simplifies
the  computation  of  earnings  per share and  increases  the  comparability  of
earnings per share on an international basis. SFAS No. 128 will be effective for
the Company for the year ending  November 30, 1998. The earnings per share under
the new  standard  do not  differ  from  those  calculated  under  the  existing
standard.


<PAGE>
MANAGEMENT'S DISCUSSION & ANALYSIS

The following discussion of the financial condition and results of operations of
the  Company  should  be read in  conjunction  with the  consolidated  financial
statements  included  elsewhere in this Form 10-QSB.  The  following  discussion
contains   certain   forward-looking   statements   that   involve   risks   and
uncertainties.  The Company's  actual results could differ  materially  from the
forward-looking  statements.  Factors  that could  cause or  contribute  to such
differences  include the following:  a decline in the demand for  advertising in
the areas where the Company  conducts its business;  a deterioration of business
conditions  generally  in such areas;  slower than  expected  acceptance  of the
Company's unique display  products;  competitive  factors,  including  increased
competition  and  price  pressures;  changes  in  regulatory  or other  external
factors;  and  other  factors  listed  from  time to time in the  Company's  SEC
reports,  including  but not limited to, its "Risk  Factors"  discussion  in the
Registration  Statement it filed in connection  with its initial public offering
(the "IPO").

Expansion Activities
--------------------

The Company has signed four additional transit district contracts since April 1,
1997:  Dallas,  Texas  (DART),  and three  contracts  in and around  Sacramento,
California,  including  Sacramento Rapid Transit (RT),  Paratransit  (PARA), and
Yolo County Transit  Authority  (YOLO).  The DART system has  approximately  800
vehicles,  while the three  districts in Sacramento have a combined total of 330
vehicles. The Company has, for the last two years, provided advertising services
in Sacramento for the 32 RT light rail vehicles only.

The Company's  contract with RT started April 1, 1997. The contract is for three
years with two additional years at the unilateral discretion of RT. The contract
provides  for RT to receive 51% of revenue  from the sale of  advertising  on RT
vehicles subject to a guaranteed minimum.  Under the contract, RT will receive a
minimum of $1.7 million over the five years.  The PARA  contract  began April 1,
1997  and is for  three  years  with  two  additional  years  at the  unilateral
discretion of PARA. The contract provides for PARA to receive  approximately 51%
of advertising  revenues in each year with no guaranteed  minimum  payment.  The
YOLO  contract  began June 1, 1997 and is for three  years  with two  additional
years at the unilateral  discretion of YOLO.  The contract  provides for YOLO to
receive  51% of  advertising  revenues in excess of $100,000 in each year with a
guaranteed minimum of $110,000 over the five years.

The Company's  contract  with DART began July 1, 1997.  The contract is for four
years and nine months.  The Company will pay DART approximately $13 million over
the term of the  contract.  After the Company was announced as the apparent high
bidder for the DART contract,  the incumbent  provider protested the anticipated
award to the Company.  The  incumbent's  protests  and appeals were denied.  The
Company incurred start up costs as discussed  below,  both to participate in the
appeal process and to be ready to commence  operations in Dallas once the appeal
process was complete.

Results of operations for the three months ended August 31, 1997 
----------------------------------------------------------------
(all dollars in $000 except per share amounts)

Net revenues  increased  44.5% from  $2,544,  for the  three-month  period ended
August 31,  1996,  to $3,676 for the  three-month  period  ended August 31, 1997
primarily  due to the addition of the Dallas and  Sacramento  markets and higher
advertising rates and increased occupancy in existing operations.  Gross transit
revenues increased  approximately  66.2% from $1,598 in 1996, to $2,664 in 1997,
while gross outdoor advertising  revenues increased 18.6% from $1,162 in 1996 to
$1,379 in 1997. Agency discounts increased 69.3% from $216 to $366 in the second
quarter of 1996 and 1997,  respectively,  reflecting an increase in  advertising
agency business primarily in transit.  Agency discounts as a percentage of gross
sales rose from 7.8% in the third  quarter of 1996 to 9.0% in the same period in
1997  reflecting  the more rapid growth of transit sales and the addition of the
Dallas and Sacramento markets.

<PAGE>

Direct  advertising  expenses increased 50.9% to $2,266 for the third quarter of
1997, from $1,502 in the comparable  period in 1996,  primarily due to increased
revenues.

General and administrative costs increased 84.4% to $563 in the third quarter of
1997  from  $305  in the  comparable  period  in  1996.  Increased  general  and
administrative  costs are primarily due to increased  payroll and other costs of
the Company's  growth and the costs of being a public company.  In addition,  in
the third quarter of 1996, the Company was part of a larger  consolidated  group
of  companies,  and,  accordingly,  a portion of the general and  administrative
costs of the companies were paid by affiliates in the third quarter of 1996.

The direct  costs of  developing  new markets was $76 in the three  months ended
August 31,  1997.  There were no  comparable  costs in the same  period of 1996.
These costs  primarily  were incurred in obtaining  the DART contract  discussed
above. The Company's  takeover in Dallas was expected to occur on April 1, 1997.
Administrative  protests by the incumbent provider delayed the effective date of
the  takeover  until July 1, 1997 and caused  the  Company to incur  significant
additional costs during the quarter to participate in the appeals  process,  and
to enable the Company to take over immediately once the appeal was resolved. The
Company  will  continue  to incur  costs to obtain and  prepare  to operate  new
transit district  contracts.  However,  the amount of these costs is expected to
decline in absolute terms and as a percentage of sales.

Interest expense  decreased  66.4%,  from $399 for the three months ended August
31,  1996,  to $134 for the  comparable  period  in 1997,  primarily  due to the
reduction in debt  resulting  from the IPO and from lower  interest rates due to
refinancing the Company's primary long-term debt in the fourth quarter of 1996.

The Company's  effective income tax rate for the third quarter of 1996 was lower
than in 1997 due to the utilization of net operating loss carryforwards in 1996.

For the above  reasons,  third quarter  income before income tax increased  from
$191 in 1996 to $489 in 1997.  After tax income  increased  from $178 in 1996 to
$301 in 1997.  Earnings  per share for the quarter  increased to 9(cent) in 1997
from 7(cent) in 1996. An increased number of shares was outstanding in 1997.

Results of operations  for the nine months ended August 31, 1997 
----------------------------------------------------------------
(all dollars in $000 except per share amounts)

Net revenues increased 28.7%, from $6,979 for the nine-month period ended August
31, 1996, to $8,984 for the  nine-month  period ended August 31, 1997  primarily
due to the addition of the Dallas and Sacramento  markets and higher advertising
rates and  increased  occupancy  in existing  markets.  Gross  transit  revenues
increased  approximately  43.7%,  from  $4,104 in 1996 to $5,896 in 1997,  while
gross  outdoor  advertising  revenues  increased  13.7%,  from $3,456 in 1996 to
$3,928 in 1997. Agency discounts increased 44.7%, from $581 to $840 in the third
quarter of 1996 and 1997,  respectively,  reflecting an increase in  advertising
agency business primarily in transit.

Agency  discounts as a percentage of sales increased from 7.7% in the first nine
months of 1996 to 8.6% in 1997 due  primarily  to increased  transit  sales as a
percentage of total sales.

Direct advertising  expenses increased 28.7% to $5,333 for the first nine months
of  1997,  from  $4,144  in the  comparable  period  in 1996,  primarily  due to
increased revenues.






<PAGE>
General and  administrative  costs  increased 58.0% to $1,512 in the first three
quarters of 1997 from $957 in the comparable  period in 1996.  Increased general
and administrative  costs are primarily due to increased payroll and other costs
of the Company's  growth , including  the addition of the Dallas and  Sacramento
markets,  and the costs of being a public  company.  In  addition,  in the first
three quarters of 1996, the Company was part of a larger  consolidated  group of
companies,   and,   accordingly,   a  portion  of  the  Company's   general  and
administrative costs of the companies were paid by affiliates in 1996.

The direct  costs of  developing  new markets was $230 in the nine months  ended
August 31,  1997.  There were no  comparable  costs in the same  period of 1996.
These costs  primarily  were incurred in obtaining  the DART contract  discussed
above. The Company will continue to incur costs to obtain and prepare to operate
new  transit  district  contracts.  However,  the amount of these  costs  should
decline in absolute terms and as a percentage of sales.

Interest expense  decreased 61.7%,  from $1,110 for the nine months ended August
31,  1996,  to $425 for the  comparable  period  in 1997,  primarily  due to the
reduction in debt  resulting  from the IPO and from lower  interest rates due to
refinancing the Company's primary long-term debt in the fourth quarter of 1996.

The Company's  effective  income tax rate for 1996 was lower than in 1997 due to
the  utilization  of net operating loss carryforwards in 1996.

For the above  reasons,  pretax income for the first three  quarters of the year
increased to $1,045 in 1997 from $517 in 1996.  After tax income  increased from
$493 in 1996 to $641 in 1997.  Earnings  per  share  for the  nine-month  period
declined  to  18(cent)  in 1997  from  20(cent)  in 1996,  primarily  due to the
increase in the number of shares outstanding.


Liquidity and Capital Resources
-------------------------------
( All dollars in $000 except per share amounts)

The Company's  working capital deficit was $334 at August 31, 1997. The decrease
in working capital  resulted  primarily from borrowings on the line of credit to
fund investing activities.

Net cash provided by (used in) operating activities was $311 for the first three
quarters of 1997 and $(31) for the third quarter of 1997 respectively.

The net cash used in investing  activities  was $1,117 for the first nine months
of 1997, and was $313 for the third quarter. Expenditures were primarily for the
construction  of  outdoor  advertising  displays  but  also  included  costs  of
furniture and tenant  improvements for the new office and production facility in
Eugene, Oregon.

The Company's net cash  provided by financing  activities  was $376 for the nine
months ended August 31, 1997 and $389 for the third  quarter,  primarily  due to
borrowings on the credit line.

At August 31, 1997,  the Company had  outstanding  borrowings  of  approximately
$7,649 of which $6,763 were pursuant to long-term credit agreements. The Company
maintains a $2,000  operating line of credit.  The line carries  interest at the
Prime rate of the lender.  As of August 31, 1997,  there were $885 in borrowings
on this line of credit, and the Company's available borrowing capacity, based on
collateralized accounts, was an additional $847.

The  Company   believes  that  cash  generated  from  operations  and  available
borrowings  under its  credit  agreements  will be  sufficient  to  finance  the
Company's operations, including anticipated capital expenditures, through fiscal
1997.



<PAGE>
Seasonality
-----------

The  Company's  transit  advertising  revenues  have  exhibited  some  degree of
seasonality.  Typically,  the Company experiences its lowest revenues during the
first  quarter of each year.  The  Company  expects  this trend to  continue.  A
reduction  in revenues in any quarter is likely to result in a  period-to-period
decline in operating performance and net income.

Item 6. Exhibits and Reports on Form 8-K

(a)   Exhibits
     (1)  Modification of U.S. Bank Loan Agreement
     (2)  Amendment of Lease Agreement with Obie Industries Incorporated
    (27)  Financial Data Schedule  

(b)  A report  on Form 8-K was  filed  by the  Company  on  September  24,  1997
     reporting the change in the Company's auditors.



Signature

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


                                   Obie Media Corporation


Date    October 10, 1997           By: /s/ James W. Callahan
     -------------------               ---------------------
                                   James W. Callahan
                                   Chief Financial Officer

                                   Signing on behalf of the registrant and
                                   as principal financial and accounting officer