SECURITIES AND EXCHANGE COMMISSION
                      Washington, DC 20549

                            FORM 10-Q

           QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
             OF THE SECURITIES EXCHANGE ACT OF 1934

For Quarter Ended                  Commission File No. 0-13829
March 31, 1997

                    PRECISION STANDARD, INC.

     (Exact Name of Registrant as Specified in its Charter)

        Colorado                        84-0985295             
(State of Incorporation)    (I.R.S. Employer Identification No.)

                        1225 17th Street
                           Suite 1800
                    Denver, Colorado 80202            
            (Address of Principal Executive Offices)
                        (303) 292-6565                            
      (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 [ ]

The number of shares outstanding of each of the issuer's classes of
common shares, as of the close of the period covered by this
report:

Class of Securities             Outstanding Securities
$.0001 Par Value                12,575,536 shares
Common Shares                   Outstanding at May 7, 1997








PART I.   FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

               PRECISION STANDARD, INC. AND SUBSIDIARIES
                      CONSOLIDATED BALANCE SHEETS
                                                
                                ASSETS

                                         March 31,       December 31,
                                            1997            1996
                                        (Unaudited)                 

Current assets:
  Cash and cash equivalents            $   369,680       $ 1,183,200
  Accounts receivable, net               9,565,688         9,435,612
  U.S. Government request for
    equitable adjustment, net              238,743                 0
  Inventories                           24,241,390        23,183,608
  Prepaid expenses and other             1,063,691           894,128
  Deferred taxes                         4,347,098         4,347,098
 
        Total current assets            39,826,290        39,043,646

Property, plant and equipment,
   at cost:
  Leasehold improvements                10,446,706        10,508,585
  Machinery and equipment               18,423,640        18,306,506
                                        28,870,346        28,815,091

Less accumulated depreciation           16,338,373        15,730,794

        Net property, plant
         and equipment                  12,531,973        13,084,297

Other assets:
  Intangible assets, net of
     accumulated amortization            3,727,079         3,731,714
  Related party receivable                 269,824           269,824
  Deposits and other                       376,233         1,627,252
  Deferred taxes                         1,517,349         1,517,349
                                         5,890,485         7,146,139
        Total other assets             $58,248,748       $59,274,082


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


               PRECISION STANDARD, INC. AND SUBSIDIARIES
                CONSOLIDATED BALANCE SHEETS (CONTINUED)

                 LIABILITIES AND STOCKHOLDERS' EQUITY

                                         March 31,       December 31,
                                           1997             1996
                                        (Unaudited)                  

Current liabilities:
  Current maturities of long-term
   debt                                 $ 7,046,111      $ 2,339,692
  Accounts payable and accrued
   expenses                              28,021,445       26,577,336
  Accrued warranty expenses                 681,831          858,856
  Estimated losses on contracts
   in progress                               87,766           87,766

          Total current liabilities      35,837,153       29,863,650

Long-term debt, net of current
  maturities                              6,191,055       11,104,410
Long-term portion of self-insured
  workers' compensation reserve           3,739,399        3,697,901
Unfunded accumulated benefit
  obligation                              1,480,237        1,480,237
          Total liabilities              47,247,844       46,146,198

Stockholders' equity:
  Common stock, $.0001 par value,
    300,000,000 shares authorized,
    12,975,973 and 12,522,646 shares
    issued and outstanding at    
    March 31, 1997 and December 31,
    1996, respectively                        1,257            1,252

  Common stock purchase warrant           4,200,000        4,200,000
  Additional paid-in capital                400,359          399,333
  Retained earnings                       9,759,896       12,287,278
  Translation adjustments                   196,884          160,013
  Minimum pension liability
    adjustment                           (3,557,492)      (3,919,992)
  Total stockholder's equity             11,000,904       13,127,884

          Total liabilities and
          stockholders' equity          $58,248,748      $59,274,082  

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


               PRECISION STANDARD, INC. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF OPERATIONS

                                                                    
                                           Three           Three
                                        Months Ended     Months Ended
                                          March 31,        March 31,
                                            1997            1996    
                                        (Unaudited)      (Unaudited)

Net sales                               $35,017,730      $ 26,547,405
Cost of sales                           (31,801,908)      (24,124,477)
     Gross profit                         3,215,822         2,422,928

Selling, general and
  administrative expenses                (5,035,790)       (3,470,101)
Research and development expense           (245,444)         (152,530)
     Income (loss) from operations       (2,065,412)       (1,199,703)

Other expense:
  Interest expense                         (325,394)         (870,503)
  Other, net                                (70,576)           75,072
     Income (loss) before income
     taxes                               (2,461,382)       (1,995,134)

Provision for income taxes                  (66,000)          (46,734)

     Net income (loss)                  $(2,527,382)     $ (2,041,868)

Loss per common share and
  common equivalent share (Note 4):
  Net loss                                    ($.20)            $(.16)
Weighted average number of
common shares outstanding                12,749,310        12,464,177

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

               PRECISION STANDARD, INC. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                   
                                           Three             Three
                                        Months Ended      Months Ended
                                          March 31,         March 31,
                                            1997              1996
                                        (Unaudited)       (Unaudited)

Cash flows from operating activities:
  Net income (loss)                     $(2,527,382)     $(2,041,868)
  Adjustments to reconcile
     net income (loss) to net cash
     provided from operating
     activities:
  Depreciation and amortization             622,297          711,916
  Pension cost in excess of 
     funding                                362,500          (39,799)
  Provision for losses on
     work in process                              0          293,924
  Loss on disposition
     of equipment                                 0            4,514

  Changes in assets and liabilities:
          Accounts receivable              (182,986)       1,202,525
          Inventories                    (1,170,045)      (1,867,195)
          Prepaid expenses and
           other assets                    (207,734)      (1,471,871)
          Intangible assets                       0          (50,000)
          U.S. Government request for
           equitable adjustment, net       (238,743)       7,315,522
          Deposits and other              1,251,019            1,159
          Accounts payable and
            accrued expenses              1,713,759       (4,593,303)
          Accrued warranty expense         (177,025)         (66,089)
             Self-insured workers'
            compensation reserve             41,500                 
          Total adjustments               2,014,542        1,441,303
     Net cash used in operating
     activities                            (512,840)        (600,565)

Cash flows from investing activities:
     Capital expenditures                   (77,320)        (304,454)
                                                  0                 
     Net cash used in
     investing activities               $   (77,320)     $  (304,454)

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



               PRECISION STANDARD, INC. AND SUBSIDIARIES
           CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

                                                   

                                           Three            Three
                                        Months Ended     Months Ended
                                          March 31,        March 31,
                                           1997             1996
                                        (Unaudited)      (Unaudited)

Cash flows from financing activities:
  Proceeds from issuance of
     common stock                       $      1,030     $     1,734

  Principal payments under
     long-term obligations                  (206,939)       (134,698)

     Net cash used in
     financing activities                   (205,909)       (132,964)

     Effect of exchange rate changes
     on cash and cash equivalents            (17,451)        (19,906)

Net increase (decrease) in cash
  and cash equivalents                      (813,520)     (1,057,889)
  
Cash and cash equivalents
  beginning of period                      1,183,200       1,411,929

Cash and cash equivalents
  end of period                         $    369,680      $  354,040

Supplemental disclosure of cash
  flow information:
  Cash paid during the period for:
     Interest                           $    387,327      $   20,430
     Income taxes                            107,000          25,800


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



            PRECISION STANDARD, INC. AND SUBSIDIARIES
                  NOTES TO FINANCIAL STATEMENTS


1.   CONSOLIDATED FINANCIAL STATEMENTS

     The consolidated interim financial statements included in this
     report have been prepared by the Company without audit.  In
     the opinion of management, all adjustments necessary for a
     fair presentation are reflected in the interim financial
     statements.  Such adjustments are of a normal and recurring
     nature.  The results of operations for the period ended March
     31, 1997 are not necessarily indicative of the operating
     results for the full year.  The interim financial statements
     should be read in conjunction with the audited financial
     statements and notes thereto included in the Company's 1996
     Form 10-K.

2.   SIGNIFICANT ACCOUNTING POLICIES

     Translation of Non-U.S. Currency Amounts - Assets and
     liabilities of non-U.S. subsidiaries that operate in a local
     currency environment are translated to U.S. dollars at the
     exchange rate for the end of the accounting period.  Income
     and expenses are translated at average rates of exchange. 
     Translation adjustments are accumulated in a separate
     component of stockholders' equity.

3.   INVENTORIES

     Inventories consist of the following:

                                     March 31,      December 31,
                                       1997            1996
                                   (Unaudited)                 

      Work in-process              $40,996,184      $43,555,521
      Finished goods                 3,391,612        3,524,575
      Raw materials and supplies     5,660,861        5,307,562
      Total                        $50,048,657      $52,387,658

      Less progress payments
        and customer deposits      (25,805,388)     (27,917,381)
      Less allowance for
        estimated losses on
        contracts in progress           (1,879)      (1,286,669)
                                   $24,241,390      $23,183,608


4.   EARNINGS PER COMMON SHARE

     The computation of loss per common share in 1996 and 1997 is
     based on the weighted average number of outstanding common
     shares.  The inclusion of stock options and stock warrants
     would be antidilutive.

     In February 1997, the Financial Accounting Standards Board
     ("FASB") issued Statement of Financial Accounting Standards,
     ("SFAS") No. 128 (the "Statement"), Earnings per Share.  This
     Statement establishes standards for computing and presenting
     earnings per share ("EPS").  This Statement will simplify the
     standards for computing earnings per share previously found in
     APB Opinion No. 15, Earnings per Share, and will make them
     comparable to international EPS standards.  It will replace
     the presentation of primary EPS with a presentation of basic
     EPS and will require dual presentation of basic and diluted
     EPS on the face of the income statement and requires a
     reconciliation of the numerator and denominator of the basic
     EPS computation to the numerator and denominator of the
     diluted EPS computation.

     This Statement is effective for financial statements issued
     for periods ending after December 15, 1997, including interim
     periods and requires restatement of all prior-period EPS data
     presented.  The Company will adopt the Statement at December
     31, 1997.  Because all contingent shares of common stock (i.e.
     options and warrants) are anti-dilutive at March 31, 1997 and
     1996, there would be no effect on the reported earnings per
     share under SFAS No. 128 for these periods.

5.   NOTES PAYABLE

                                         March 31,  December,31,
                                          1997         1996     
                                       (Unaudited)

     Short-term debt consists of
     the following:

     Term Credit facility             $ 5,007,799   $   607,799
     Senior Subordinated Loan           1,350,000       900,000

     Note due to individual, bears        307,173       377,173
     interest at 10% collateralized
     by a security interest in
     certain equipment


     Other obligations                    381,139       454,720
     collateralized by security        
     interests in certain
     equipment                                                    
                                      $ 7,046,111   $ 2,339,692


     Long term debt consists of
     the following:                                    

     Term Credit facility                     -0-     4,400,000
     Senior Subordinated Loan           5,850,000     6,300,000

     Other obligations,                   341,055       404,410
     collateralized by security
     interests in certain
     equipment                                                 
                                      $ 6,191,055   $11,104,410

     Total debt                       $13,237,166   $13,444,102

     The Company and its primary lender renegotiated terms and
     conditions of its debt and warrant and executed new
     agreements in March 1997.  During 1996, the Company made
     principal payments of $2.8 million for the Senior
     Subordinated loan, $4.2 million of the Term Credit
     facility and $8.0 million in full payment for the
     Revolving Credit facility.  In accordance with these new
     agreements, interest accrued through March 1996 in the
     amount of $2,207,799 was capitalized into the principal
     balance of the debt.  The new agreements also provided
     for the forgiveness of approximately $1.3 million of
     accrued but unpaid interest for the period from May
     through September of 1996 which is being recognized
     prospectively as a yield adjustment.

     The above loans are collateralized by substantially all
     of the assets of the Company and have various covenants
     which limit or prohibit the Company from incurring
     additional indebtedness, disposing of assets, merging
     with other entities, declaring dividends, or making
     capital expenditures in excess of certain amounts in any
     fiscal year.  Additionally, the Company is required to
     maintain various financial covenants.  While the Company
     was not in compliance with certain of its financial
     covenants prior to the new agreements noted above, the
     Company was in compliance with such covenants at March
     31, 1997 under the new agreements.

     Although the Company's cash position was significantly
     strengthened by the settlements negotiated with the U.S.
     Government during 1996, the Company's cash resources
     continued to be strained in 1997 primarily due to
     excessive program and procurement costs incurred,
     increased costs associated with the work stoppage of the
     Company's United Auto Worker (UAW) employees which ended
     March 31, 1997, and losses incurred on various commercial
     aircraft maintenance contracts performed.

     The Company is currently in the process of refinancing
     its debt.  The Company has entered into discussions with
     a number of institutional lenders that have expressed
     interest in providing debt financing in the form of a
     term loan and a revolving line of credit.

6.   CONTINGENCIES

     The Company is preparing a Request for Equitable Adjustment
     (REA) related to its H-3 helicopter contract with the U.S.
     Government.  The primary grounds for this REA are delays in
     government furnished material (GFM), increased cost of pilot
     services, and late delivery of technical data.  The Company's
     independent management consultant has determined a preliminary
     rough order of magnitude of the cost impact under the H-3
     contract.  Based on this assessment, the Company has recorded
     a receivable of $238,000 net of reserves in the first quarter
     of 1997.  The Company believes that the evidence in support of
     the proposed REA is objective and verifiable and reasonable in
     view of the work performed and the increased costs are not the
     result of any deficiencies in the Company's performance. 
     However, should the Company's REA ultimately be disallowed by
     the U.S. Government, which event the Company deems unlikely,
     the Company would realize a pre-tax reduction of revenue of
     $238,000.


ITEM 2.

              MANAGEMENT'S DISCUSSION AND ANALYSIS
        OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

INTRODUCTION

The following discussion should be read in conjunction with the
Company's consolidated financial statements and notes thereto
included herein.

RESULTS OF OPERATIONS

Three months ended March 31, 1997
versus three months ended March 31, 1996

Revenues for the first quarter of 1997 increased 32% from $26.5
million in 1996 to $35.0 million in 1997.  Government sales
increased 28% in 1997, from $15.8 million in 1996 to $20.2 million
in 1997.  Commercial sales increased 38% in 1997, from $10.7
million in 1996 to $14.8 million in 1997.  The Company's mix of
business between government and commercial customers shifted from 
40% commercial and 60% government in 1996 to 42% commercial and 58%
government in 1997.

The increase in government sales in the first quarter of 1997 was
due primarily to an increase in the number of KC-135 Programmed
Depot Maintenance (PDM) aircraft redeliveries and an adjustment to
the timing of contract billings under the KC-135 program.  Nine
aircraft were redelivered in 1997 versus eight aircraft in 1996. 
As a result of the re-negotiation of certain contract provisions
with the Government during 1996, the Company is allowed to bill for
over-and-above costs as incurred, which accelerates the receipt of
payments under the KC-135 contract.

Government sales also increased due to an increase in the number of
redeliveries under the Company's C-130 contract.  The Company
redelivered two PDM aircraft and four drop-ins in 1997 versus one
PDM aircraft and no drop-in aircraft in 1996.

The Company's commercial sales increased primarily due to an
increase in the number of 727 cargo conversion redeliveries (four
in 1997 versus one in 1996) and increases in redeliveries under
aircraft maintenance contracts.  Adding to this increase in sales
was an increase in volume of approximately $.7 million at the
Company's Pemco World Air Services facility in Copenhagen, Denmark.

The ratio of cost of sales ($31.8 million in 1997; $24.1 million in
1996) to net sales ($35.0 million in 1997; $26.5 million in 1996)
remained constant at 91% in the first quarter of 1996 and at 91% in
1997.  However, the resultant increase in gross profit was offset
by increased costs incurred under the Company's KC-135 PDM program
due to the UAW work stoppage.

The Company incurred more than $6.6 million in incremental strike
related costs during the UAW work stoppage.  While the majority of
those costs were incurred in 1996, approximately $5.5 million will
be accounted for throughout 1997 as aircraft incurring those costs
are redelivered and booked into revenue.  These amounts are
primarily attributable to the high cost of contract labor,
training, housing and transportation costs for replacement workers,
as well as increased security costs during the strike period.

Revenues at the Copenhagen aircraft facility increased
approximately 24% in the first quarter of 1997 as compared to 1996. 
Operating losses were slightly greater (7%) at the facility due to
the utilization of contract labor necessary to meet the demands
caused by the substantial increase in workload.

Selling, general and administrative expense (SG&A) increased from
$3.5 million in the first quarter of 1996 to $5.0 million in 1997
and increased as a percent of sales from 13% in 1996 to 14% in
1997.  SG&A increased primarily due to an increase in the amount of
commercial work in process.  Under Generally Accepted Accounting
Principles, SG&A incurred for commercial contracts must be accrued
and recognized in the current period, whereas SG&A related to
government contracts are inventoried until redelivery of the
aircraft or shipment of the product.

Interest expense was $0.3 million in the first quarter of 1997
versus $0.9 million in 1996.  From March of 1996 to March of 1997,
the Company paid $4.2 million in principal against its Term Credit
facility.  The effective average interest rate in the first quarter
of 1997 on the Term Credit facility was 10% versus 12.40% in the
first quarter of 1996.

LIQUIDITY AND CAPITAL RESOURCES

The Company's cash resources continued to be strained in 1997
primarily due to additional costs incurred in connection with the
work stoppage of the Company's UAW employees at the Birmingham
facility which ended on March 31, 1997, excessive costs on its KC-
135 program, delayed redelivery of KC-135 aircraft, and losses
incurred on various commercial aircraft maintenance contracts
performed at the Company's Dothan, Alabama and Copenhagen, Denmark
facilities.

In October of 1996, the Company paid $15.0 million of principal to
its primary lender from the proceeds of the settlement with the
U.S. Government, with $2.8 million applied to the Senior
Subordinated loan, $4.2 million to the Term Credit facility and
$8.0 million to fully repay the Revolving Credit facility.  In
March of 1997, the Company and its primary lender executed a Second
Amended and Restated Credit Agreement (the "Credit Agreement"), a
Second Amended and Restated Senior Subordinated Loan Agreement (the
"Subordinated Agreement") and an Amended and Restated Warrant
Agreement (the "Warrant Agreement").  The Credit Agreement and the
Subordinated Agreement provide for the forgiveness of approximately
$1.3 million of accrued but unpaid interest in 1996.  The Company
recognized approximately $0.6 million of the forgiven interest in
1996 and anticipates recognizing the remaining $0.7 million over
the years 1997 through 2001.  During 1997, the Company will
recognize $.3 million allocated equally to each quarter.  The
balance of $.4 million will be taken pro-rata over the period 1998
through 2001.  Details of these agreements are contained in the
Company's 1996 Form 10-K.
  
The Company is currently in the process of refinancing its debt. 
The Company has entered into discussions with a number of
institutional lenders that have expressed interest in providing
debt financing in the form of a term loan and a revolving line of
credit.

The following is a discussion of the significant items in the
Company's Consolidated Statement of Cash Flows for the quarters
ending March 31, 1997 and 1996.

The Company's pension expense as determined by its actuary for the
year 1997 is $1.45 million, as compared to $1.0 million in 1996. 
In the first quarter of 1997, the Company made no contributions to
the pension plan and expensed approximately $0.36 million.  In the
first quarter of 1996, the Company funded approximately $0.3
million and expensed approximately $0.25 million.

Accounts payable and accrued expenses increased in the first
quarter of 1997 due to continued cash constraints and the increase
in workload at the Company's various facilities.  Accrued interest
payments at March 31, 1997 were $0.3 million, representing a $0.6
million reduction over that due at March 31, 1996.  This reduction
in interest was primarily due to the debt principal paid during
1996 and a reduction in the overall average interest rate in 1997.

The Company did not record a provision for losses on work in
process for the first quarter of 1997.  However, in the first
quarter 1997, the Company recognized $1.3 million of reserves for
losses attributable to work in process in 1996.  In the first
quarter of 1996, the Company recorded a $1.3 million provision for
losses on certain of its commercial and government contracts which
were performed at the Dothan facility.

Net inventories increased $1.1 million in the first quarter of 1997
primarily due to a recognition of reserves for estimated losses on
contracts in progress of $1.3 million and a reduction in net work
in process caused by a reduction in progress payment balances. 
(See Note 3 to Financial Statements).

Cash provided from the Company's operating activities funded $.5
million used in the Company's operations, $0.1 million for capital
improvements, and $0.2 million for payments on various capital
leases in the first quarter of 1997.  Additionally, the Company
paid $0.4 million in interest and $0.1 million in taxes.  In the
first quarter of 1996, the Company used $0.6 million of cash for
operating activities, $0.3 million for capital improvements, and
$0.1 million for payments on various capital leases.

During 1995, 1996 and 1997, inflation and changing prices have had
no significant impact on the Company's net sales or revenues or on
income from continuing operations.
 
BACKLOG

The following table presents the Company's backlog (in thousands of
dollars) at March 31, 1997 and 1996:

                                 1997        1996

          U.S. Government     $135,618    $100,498
          Commercial            33,992      18,342      
                              $169,610    $118,840

As of March 31, 1997, 80% of the Company's backlog related to work
for the U.S. Government versus 85% for the period ending March 31,
1996.  The Company's Government backlog increased $35 million
primarily related to a contract for sounding rocket launches
awarded to its Space Vector subsidiary.

The Company's commercial backlog at March 31, 1997 increased $15
million from the prior year primarily due to increased orders at
the Company's Dothan, Copenhagen, and Nacelles facilities.

Approximately $49.1 million of the 1997 backlog and $44.2 million
of the 1996 backlog reported above is firm but unfunded. 
Additionally, the Company has an estimated $261 million of backlog
associated with the option periods for the KC-135 contract and the
HERA program which are not reflected above.  The Company also
currently estimates it will receive orders for approximately $15.4
million for additional work related to existing contracts; this
amount is not included in the numbers above.

CONTINGENCIES

The Company, as a U.S. Government contractor, is routinely subject
to audits, reviews and investigations by the government related to
its negotiation and performance of government contracts and its
accounting for such contracts.  Under certain circumstances, a
contractor can be suspended or debarred from eligibility for
government contract awards.  The government may, in certain cases,
also terminate existing contracts, recover damages and impose other
sanctions and penalties.  The Company believes, based on all
available information, that the outcome of the U.S. Government's
audits, reviews and investigations will not have a materially
adverse effect on the Company's consolidated results of operation,
financial position or cash flows.

FORWARD LOOKING STATEMENTS

Statements contained herein concerning anticipated results of
operations, the outcome of pending and future litigation, the
completion of refinancing, the outcome of audits, reviews and
investigations by the U.S. Government, the outcome of REAs filed
with the U.S. Government, and the Company's intent to take certain
actions in the future are forward looking statements, the accuracy
of which cannot be guaranteed by the Company.  These forward
looking statements are subject to a variety of business risks and
other uncertainties, including but not limited to the effect of
economic conditions, the impact of competitive products and
pricing, new product development, litigation risks, the actual
performance of work under contract, customer contract awards and
actions with respect to utilization and renewal of contracts, and
the results of financing efforts.

                     PRECISION STANDARD,INC.

                        OTHER INFORMATION

PART II.

Item 1    Legal Proceedings

In May 1997, the Company's Pemco Aeroplex subsidiary received a
letter from the Department of Justice indicating that the
Government may bring a civil action against Pemco under the False
Claims Act arising out of the sale of C-130 wings to Pemco.  If any
such action is brought, the Company believes that Pemco has valid
defenses and that it will prevail if litigation is instituted.

In American International Airway, Inc. v. GATX Capital Corporation,
et al., U.S.D.C., N.D. Cal., the owner of two aircraft converted
under a Supplementary Type Certificate for 747 cargo conversions
owned by GATX and others, sued GATX and various other defendants
seeking damages.  As a result of an Airworthiness Directive issued
by the FAA in January 1996, aircraft which had been so converted
were restricted to carrying reduced payloads.  The Company's Pemco
Aeroplex subsidiary has been named as one of seven defendants in
the case because of allegedly improper engineering work performed
in the 1980's by its predecessor, Hayes International.  The
complaint, which was served on Pemco on February 5, 1997, alleges
violations of the Racketeer Influenced and Corrupt Organization Act
(RICO), conspiracy, and negligence against Pemco.  Pemco has filed
a motion to dismiss the complaint.  Pemco believes the allegations
made against it are without merit and intends to vigorously defend
this claim.         

Item 2    Changes in Securities

          None

Item 3    Defaults Upon Senior Securities

          None

Item 4    Submission of Matters to a Vote of Security Holders

          None

Item 5    Other Information

          None

Item 6    Exhibits and Reports on Form 8-K

          a)   Exhibits




          4.1  Second Amended and Restated Credit Agreement between
               Precision Standard, Inc. and Bank of America
               National Trust and Savings Association entered into
               as of December 31, 1996.

          4.2  Second Amended and Restated Senior Subordinated Loan
               Agreement between Precision Standard, Inc. and Bank
               of America National Trust and Savings Association
               entered into as of December 31, 1996.

          4.3  Amended and Restated Warrant issued by Precision 
               Standard, Inc. to the Bank of America National
               Trust and Savings Association entered into as of
               December 31, 1996.

          27   Financial Data Schedule

          b)   Reports on Form 8-K

               Reports on Form 8-K and Form 8-K/A dated December
          30, 1996 under Item 4 were filed with the Commission on
          January 6, 1997 and January 13, 1997, respectively.  In
          addition, a Report on Form 8-K dated January 14, 1997
          under Item 4 was filed with the Commission January 21,
          1997.


                         SIGNATURES



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.




                                   PRECISION STANDARD, INC.



Date:       5/14/97                By:  /s/ Matthew L. Gold     
                                         Matthew L. Gold
                                         Chairman, President and
                                         Chief Executive Officer
                                          



Date:       5/14/97                By:  /s/ Timothy A. Rabon    
                                         Timothy A. Rabon
                                         Vice President
                                         and Treasurer
                                         (Principal Financial
                                         and Accounting Officer)