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

                           (Mark one)

[X]                 QUARTERLY REPORT UNDER SECTION 13  OR  15
                    (d) OF THE SECURITIES EXCHANGE ACT OF 1934
    
          For the quarterly period ended: June 30, 1998

[ ]       TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF  THE
                  SECURITIES EXCHANGE ACT OF 1934

     For   the  transition  period  from  ____________   to_____________

                   Commission file number: 0-023532

                   AMERICAN DIVERSIFIED GROUP, INC.
(Exact name of small business issuer as specified in its charter)

              Nevada                             88-0292161
    (State or other jurisdiction of        (IRS Employer Identification No.)
    incorporation or organization)



      110 North Center Street, Suite 202, Hickory, NC 28601
            (Address of principal executive offices)

                         (704) 322-2044
                   (Issuer's telephone number)

                                
     (Former name, former address and former fiscal year, if
                   changed since last report)

        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 for such shorter  period
that the registrant was required to file such report (s), and
(2) has been subject to such filing requirements for the past
90 days.  Yes [ X ]    No [   ]

              APPLICABLE ONLY TO CORPORATE ISSUERS
        State the number of shares outstanding of each of the
issuer's classes of common equity, as of the latest practicable date:

        Common  Stock,  $.001  par value  210,212,560  shares
        outstanding as of June 30, 1998.

Transitional Small Business Disclosure Format:  Yes __  No  X





                              INDEX


                AMERICAN DIVERSIFIED GROUP, INC.


PART I FINANCIAL INFORMATION


Item 1.Financial Statements (Unaudited)

       Balance Sheets - December 31, 1997 and June 30, 1998 (Unaudited).

       Statements of Operations - Three months and six months
       ended June 30, 1998 and 1997 (Unaudited).

       Statements of Cash Flows - Three months and six months
       ended June 30, 1998 and 1997 (Unaudited).

       Notes to Financial Statements

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

                Results of Operations

          American Diversified Group, Inc. (the "Company")  is
  a  development stage company. During the Company's three and
  six  month periods ended June 30, 1998, the Company incurred
  net  losses  of $279,686  ($.0013 per Share)   and  $872,356
  ($.0044 per  share)  compared  to losses of  $260,094  
  ($0.0030  per Share)  and  $959,756 ($0.0119 per share) for
  the comparable three  and  six month periods of the prior
  fiscal year.  The Company reported sales of $13,672 and $66,422,
  respectively, for the three and six month periods  ended 
  June  30,  1998, represented  by  the  sales revenues  and
  receivables from generic pharmaceuticals  and telecommunication
  sales, compared to no sales  revenues  or accounts receivable
  for the comparable periods of the  prior year.
       
       The  Company's net losses for the  three and  six month
  periods ended June  30,  1998, was principally the result of
  the limited sales revenues during the quarter, the continued
  expenses associated with continuing to operate and  maintain
  its offices and expenses associated with being  a  reporting
  company,   which   include  professional,   accounting   and
  printing/EDGAR preparation and filing fees, and the non-cash
  expenses  associated  with the issuance  of  shares  to  its
  executive  officer, directors and consultants for  continued
  services to the Company in lieu of cash compensation  during
  the  period. Such non-cash compensation expensed during  the
  six month period ended June 30, 1998, was $996,400, compared
  to $975,000 during the same period in the prior fiscal year.
  In  order  for  the  Company to pay its operating  expenses,
  including  office rents, communication expenses,  accounting
  and  bookkeeping fees, printing and EDGAR preparation costs,
  publication  costs,  and  other general  and  administrative
  expenses, the Company was dependent upon the funds  provided
  by  non-interest bearing loans from the Company's  executive
  officer  and directors, from a consultant, as well  as  from
  the   private  placement  of  its  securities   to   private
  investors.
       
       The  Company  has continuing orders for  pharmaceutical
  products in West Africa, which will increase in size  during
  successive quarters in fiscal 1998, and projects  to  expand
  its  orders to other West African countries. The Company  is
  increasing its product lines to include a broad spectrum  of
  generic  pharmaceuticals  and  diagnostic  test  kits.   The
  Company has been informed that the dengue fever test kit has
  been  approved by Brazil's Helath Department and the Company
  projects  that initial sales of the test kit should commence
  during  the  third  quarter of fiscal 1998,  with  potential
  annual sales in Brazil nationally of up to $5 million.

       The  Company's ability to continue to ship the products
  that are the subject of the purchase orders from West Africa
  is  essential to the Company's goal of generating  increased
  levels  of  operating revenues from its  pharmaceutical  and
  medical  products business in West Africa.  The  Company  is
  presently outsourcing these generic pharmaceutical  products
  from  several  third  party manufacturers  and  distributors
  located in the United States, Canada, Mexico, South America,
  Europe,  and  India,  which  have provided  quality  generic
  pharmaceutical   products  at  highly   competitive   prices
  necessary for the Company to profitably fulfill existing and
  future  orders  for  such  products  from  West  Africa  and
  elsewhere.
       
        The   Company   projects  from  call-back   sales   to
  international  and  domestic  mining  companies,   financial
  institutions,  oil companies and foreign embassies  in  West
  Africa that it should be able to generate gross revenues  of
  up  to  $200,000  monthly,  after  installation  of  certain
  telecommunications hardware and software. This is based upon
  having  approximately 200 customersbefore the end of  fiscal
  1998,  with estimated usage of $500 to $1,000 per  customer.
  To date, the Company has signed 50 to 100 customers for call
  back  service  in  West  Africa but  has  had  only  limited
  revenues  and  receivables  from call-back  because  of  the
  requirement  to install the enhanced hardware and  software.
  This  installation shall permit the Company  to  expand  the
  market  penetration  for  its  call-back  telecommunications
  service in West Africa.
  
          The  services of the Company's consultants, together
  with  that  of  the Company's management, have  enabled  the
  Company  to  reach  its present stage of development,  which
  includes having:
           (i)   shipped   additional  generic  pharmaceutical
  products   subject  to  orders  from  West   Africa,   after
  generating its purchase orders for such products  in  fiscal
  1997  and  its first shipments during the third  quarter  of
  fiscal 1997;
          (ii)  received a letter of credit in  the  aggregate
  initial  amount  of approximately $70,000, which  sums  were
  paid to the Company during the first and second quarters  of
  fiscal  1998, as payment of generic pharmaceutical  products
  from West Africa;
          (iii)  secured third party manufacturers  from  whom
  the  Company  can continue to source generic pharmaceuticals
  at  competitive  pricing so as to enable  it  to  sell  such
  products at satisfactory profit margins during fiscal  1998,
  in  the  highly  competitive and price sensitive  developing
  world markets;
          (iv)  secured approvals of dengue fever  test  kits,
  which  are prerequisite for the anticipated purchase  orders
  for   dengue  fever  test  kits  from  the  National  Health
  Foundation of Brazil;
          (v) established a business venture that is presently
  marketing  call-back  telecommunication  services  to  major
  multinational  corporations, domestic business  corporations
  and foreign embassies in West Africa, from which the Company
  first  began  to generate accounts receivable commencing  in
  September,  1997,  with  increasing  revenues  and  accounts
  receivable  being  generated during  the  third  and  fourth
  quarters of fiscal 1998;
            (vi)   commenced   business   relationship    with
  manufacturers  of complete lines of generic  pharmaceuticals
  for   the  purpose  of  satisfying  the  Company's  existing
  purchase orders and its expected increasing level of  orders
  in West Africa; and
       (vii)   entered  into  a  joint  venture   and   equity
  participation     agreement    with    Global     Transmedia
  Communications  Corp., Miami, FL, which is  engaged  in  the
  sale  of  Internet  and  Telephony  products  and  services,
  including  low  cost  long  distance  service,  and  on-hold
  messaging and advertising products and services.
  
        The  Company  continues  to  be  dependent  upon   the
  willingness  of  the Company's executive officer,  directors
  and each of its consultants to accept shares in lieu of cash
  compensation  for  continued services to the  Company.  This
  funding,  together  with  the recent  payments  for  generic
  pharmaceutical  products from the letter of credit  for  the
  shipments  to West Africa, and anticipated increased  levels
  of  telecommunications revenues in the coming months, should
  enable the Company to become operational and hopefully  will
  permit  the  Company's independent auditors to  remove  from
  their  report the qualification regarding the Company  as  a
  "going concern" during subsequent fiscal periods, perhaps as
  early as the second quarter of 1998.
  
      Liquidity and Capital Resources
  
       The  Company, at June 30, 1998, had current  assets  of
  approximately $94,262  compared to $40,303 at the  June  30,
  1997,  and  $64,460  at  the end of the  fiscal  year  ended
  December  31, 1997. To assist the Company in its  cash  flow
  requirements which are presently estimated at $10-15,000 per
  month,  the  Company  may  determine  to  continue  to  seek
  subscription  proceeds from private investors,  as  well  as
  revenues  from  sales  of  products  and  telecommunications
  products and services, and anticipated commencement of sales
  revenues from dengue fever test kits in Brazil. Further, the
  Company projects that with the increased revenues from call-
  back     following    the    installation    of     enhanced
  telecommunications hardware and software, the Company  shall
  also  have  higher profit margins on such revenues  for  the
  reasons stated above.
  
       Based upon the Company's present liquid resources after
  the expenses that were paid by the Company following receipt
  of  the  private  placement funds, which  expenses  included
  office   expenses,  professional/accounting  fees,  transfer
  agent and printing service fees, and certain other expenses,
  and based upon its present monthly operating expenses of $10-
  15,000,   the   Company  will  be  able   to   operate   for
  approximately  four  months if no  additional  revenues  are
  generated   from   operations.  However,  the   Company   is
  generating increased operating revenues during the first and
  second  quarters of fiscal 1998, as a result  of  additional
  shipments  of  generic pharmaceuticals to West  Africa,  and
  projects  increasing  receivables from  sales  of  call-back
  service in West Africa and anticipates revenues from Brazil.
  
        The  Company's  monthly  operating  expenses  for  the
  quarter  ended June 30, 1998 and during the present  quarter
  include rent for executive office space in Hickory, NC,  use
  of  conference facilities for its Investor Relations offices
  at  Rockefeller Center in NYC, professional/accounting fees,
  telephones, but do not reflect any salary to Dr. Jerrold  R.
  Hinton, the Company's sole executive officer. The Company is
  accruing but does not contemplate commencing payment to  Dr.
  Hinton  of the monthly salary of $8,333.33 provided  in  his
  three  year employment agreement unless and until it  begins
  to  generate  positive  cash flow  from  operations.  During
  fiscal  1997  and  the  first quarter of  fiscal  1998,  the
  Company's executive officer, directors and consultants  were
  issued  shares  in registration statements on  Form  S-8  in
  consideration  for their continued services to  the  Company
  and in lieu of any cash compensation.





PART II.       OTHER INFORMATION


Item 1.Legal Proceedings


       See Footnote 3-Miscellaneous Receivables- to Notes to
       Financial Statements for the Fiscal Year Ended 
       December 31, 1997.


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



       Exhibit 27



ARTICLE 5

THIS   SCHEDULE   CONTAINS  SUMMARY   FINANCIAL   INFORMATION
EXTRACTED  FROM  THE  BALANCE  SHEET  (UNAUDITED)   AND   THE
OPERATIONS FOR THE PERIOD ENDED JUNE 30 1998 (UNAUDITED)  AND
IS  QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH  FINANCIAL
STATEMENTS.

                           SIGNATURES

       In accordance with the requirements of the Securities
Exchange Act of 1934, the registrant caused this report
caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


                              AMERICAN DIVERSIFIED GROUP,INC.
                              (Registrant)




August, 1997                  By: /s/Jerrold R. Hinton
                              Jerrold R. Hinton
                              President, Chief Executive Officer
                              and Chief Financial Officer



                       AMERICAN DIVERSIFIED GROUP, INC.
                      FORMERLY TERA WEST VENTURES, INC.
                        (A DEVELOPMENT STAGE COMPANY)
                            FINANCIAL STATEMENTS
                                 (UNAUDITED)
                                JUNE 30, 1998


                       AMERICAN DIVERSIFIED GROUP, INC.
                      FORMERLY TERA WEST VENTURES, INC.
                        (A DEVELOPMENT STAGE COMPANY)
                             FINANCIAL STATEMENTS
                                 (UNAUDITED)
                                JUNE 30, 1998



                                                 Page


Balance Sheet                                     1

Statements of Operations                          2

Statements of Cash Flows                          3

Notes To Financial Statements                     5





                       AMERICAN DIVERSIFIED GROUP, INC.
                      FORMERLY TERA WEST VENTURES, INC.
                        (A DEVELOPMENT STAGE COMPANY)
                                BALANCE SHEET
                                 (UNAUDITED)
                             AS OF JUNE 30, 1998
                                       
<TABLE>
<CAPTION>
<S>                                                    <C>            <C>   
ASSETS
Current Assets:                                                               
    Cash                                                $11,079               
    Accounts Receivable (Net)                            24,891               
    Due from Customer                                    18,100               
    Inventories                                           5,000               
    Prepaid Expenses                                        533               
                                                        -------
        Total Current Assets                                            59,603
                                                                              
Fixed Assets:                                                                 
    Property and Equipment (Net of $16,785 Accum. Depr.)
                                                                        19,089
                                                                              
Other Assets:                                                                 
    Deposits                                                570               
    Advance to Affiliate                                 15,000               
    Miscellaneous Receivable     
     (Net of $100,000 Allowances)                          -
                                                         ------
        Total Other Assets                                              15,570
                                                                       -------               
        Total Assets                                                   $94,262
                                                                       =======

</TABLE>
<TABLE>
<CAPTION>
<S>                                                 <C>               <C> 
LIABILITIES AND SHAREHOLDERS'(DEFICIT) EQUITY
Current Liabilities:                                                          
    Accounts and Accrued Expenses Payable               $11,421               
    Accounts and Accrued                                               
    Expenses Payable to Related Parties                 234,044
    Notes Payable to Related Parties                    191,463               
                                                      ---------   
        Total Current Liabilities                                      436,928
                                                                        
Shareholders' (Deficit) Equity:                                               
    Preferred Stock, Series A, $10 par value                                                
     authorized 50,000 shares; none outstanding            -                    
    Common Stock, par value $.001 per share,                                                  
     authorized 350,000,000 shares; issued and
     outstanding 212,062,520 shares                     212,062               
    Additional Paid-In Capital                       17,846,819               
    Stock Subscriptions Receivables                     (10,500)               
    Deferred Consulting Fees                           (964,334)               
    Deficit Accumulated During                                     
     Development Stage                               (8,614,924) 
    Deficit Accumulated Prior to                                   
     Development Stage                               (8,811,789) 
                                                     ----------- 
         Total Shareholders' (Deficit) Equity                         (342,666)
                                                                      ---------
         Total Liabilities and Shareholders' (Deficit) Equity          $94,262
                                                                      =========           
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS
                                                                              
                                         1                                    

                            AMERICAN DIVERSIFIED GROUP, INC.
                           FORMERLY TERA WEST VENTURES, INC.
                             (A DEVELOPMENT STAGE COMPANY)
                                STATEMENTS OF OPERATIONS
                                      (UNAUDITED)


<TABLE>
<CAPTION>
                                          
                                                                                        
                                         6 MONTHS     6 MONTHS     3 MONTHS     3 MONTHS
                                            ENDED        ENDED        ENDED        ENDED
                                         JUNE 30,     JUNE 30,     JUNE 30,     JUNE 30,
                                             1998         1997         1998         1997
<S>                                  <C>          <C>          <C>           <C>                                                    
Revenues                                  $66,422           $0      $13,672           $0
Cost of Revenues                           56,630                    11,135   
                                        ---------    ---------    ---------    ---------
Gross Profit                                9,792            0        2,537            0
Selling, General and                      
Administrative Expenses                   889,950      959,756      282,223      260,094     
                                        ---------    ---------    ---------    ---------       
Loss From Operations                    (880,158)    (959,756)    (279,686)    (260,094)
                                                                                        
Other Income:                                                                           
   Reimbursement of Losses                   7802            0            0            0
                                      -----------  -----------  -----------   ----------       
Net Loss                               ($872,356)   ($959,756)   ($279,686)   ($260,094)
                                      ===========  ===========  ===========   ========== 
Net Loss Per Share                      ($0.0044)    ($0.0119)    ($0.0013)    ($0.0030)
                                      ===========  ===========  ===========   ==========
Average Number of Shares Outstanding  197,342,671  80,520,572   212,062,560   85,891,131
                                      ===========  ===========  ===========   ==========
</TABLE>
                                                            
                                                           
SEE NOTES TO FINANCIAL STATEMENTS
                                                          
                                                2
                                       
                            AMERICAN DIVERSIFIED GROUP, INC.
                           FORMERLY TERA WEST VENTURES, INC.
                             (A DEVELOPMENT STAGE COMPANY)
                                STATEMENTS OF CASH FLOWS
                                      (UNAUDITED)
                                                           
                                                         
<TABLE>
<CAPTION>
                                                                                
                                         6 MONTHS     6 MONTHS     3 MONTHS     3 MONTHS
                                            ENDED        ENDED        ENDED        ENDED
                                         JUNE 30,     JUNE 30,     JUNE 30,     JUNE 30,
                                             1998         1997         1998         1997
<S>                                    <C>          <C>          <C>          <C>                
Cash Flows From Operating                                                               
Activities:
    Net Loss                            ($872,356)   ($959,756)   ($279,686)   ($260,094)
    Depreciation                            3,487        2,950        1,776        1,647
    Amortization of Deferred                     
     Consulting Fees                      401,942                   232,971      
    General and                           
     Admin.Expenses Paid by Stock         388,400      775,362                   175,181
    Decrease in Accounts                     
     Receivable                            23,500                    36,964
    Increase in Due from Customer         (18,100)                  (18,100)   

    Increase in Prepaid Expenses             (533)                     (533)   
    Increase in Deposits                               (29,733)                  (30,303)
    Increase In Accounts Payable                                                                
     Accrued Expenses                      60,852       39,218       38,664       28,463
                                          --------    ---------      ------      --------  
       Net Cash Flows From             
       Operating Activities               (12,808)    (171,959)      12,056      (85,106)
                                          --------    ---------      ------      --------                                       
                                                                                        
Cash Flows From Investing                                                               
Activities:
   Advances to Affiliates                 (15,000)                  (15,000)   
   Increase in Due from Related Party                   (5,000)                   (5,000)
   Acquisition of Property                
    and Equipment                          (2,124)      (9,135)      (1,608)      (5,334) 
                                          --------     --------      -------      -------
   Net Cash Flows From Investing         
    Activities                            (17,124)     (14,135)     (16,608)     (10,334)    
                                          --------     --------     --------     --------         
</TABLE>

               
                                               
                                                                    
                                                3                    
         
                            AMERICAN DIVERSIFIED GROUP, INC.
                           FORMERLY TERA WEST VENTURES, INC.
                             (A DEVELOPMENT STAGE COMPANY)
                                STATEMENTS OF CASH FLOWS
                                      (UNAUDITED)
                                                                    
<TABLE>
<CAPTION>
                                                                                        
                                         6 MONTHS     6 MONTHS     3 MONTHS     3 MONTHS
                                            ENDED        ENDED        ENDED        ENDED
                                         JUNE 30,     JUNE 30,     JUNE 30,     JUNE 30,
                                             1998         1997         1998         1997
<S>                                     <C>          <C>          <C>          <C>                                      
Cash Flows From Financing Activities:
   Sales of Common Stock                               135,500                    35,500
   Brokers' Fee Paid on Sales                                                     
    of Common Stock                        (6,000)     
   Proceeds from Notes                   
    Payable to Related Parties             50,942       50,000                    50,000  
   Payments on Notes Payable         
    to Related Parties                    (15,000)      (9,000)     (15,000)      (5,000) 
   Cash Overdraft                                        9,594                    13,604
                                        ----------    ---------    ---------   ----------   
      Net Cash Flows From              
       Financing Activities                29,942      186,094      (15,000)      94,104 
                                        ----------    ---------    ---------   ----------        

Net Increase (Decrease) In Cash                10            0      (19,552)      (1,336)
Cash, Beginning of Period                  11,069            0       30,631        1,336
                                        ----------    ---------    ---------   ----------     
Cash, End of Period                       $11,079           $0      $11,079           $0
                                        ==========    =========    =========   ==========       
</TABLE>
                                                                    
Non-Cash Transactions in 1998:
1. Issued 52,700,000 shares of costock for services of $996,400.
                                                                
Non-Cash Transactions in 1997:
1. Issued 19,500,000 shares of common stock for services of $975,000.
                                                                 
SEE NOTES TO FINANCIAL STATEMENTS


                                                      
                                                4               

                AMERICAN DIVERSIFIED GROUP, INC.
                FORMERLY TERA WEST VENTURES, INC.
                  (A DEVELOPMENT STAGE COMPANY)
                  NOTES TO FINANCIAL STATEMENTS
                           (UNAUDITED)
                          JUNE 30, 1998





NOTE 1 - BASIS OF PRESENTATION

The  accompanying  unaudited  financial  statements  reflect  all
adjustments,  which, in the opinion of management, are  necessary
for a fair presentation of the financial position and the results
of  operations for the interim period presented.  All adjustments
are of a normal recurring nature.

Certain financial information and footnote disclosures which  are
normally  included in financial statements prepared in accordance
with generally accepted accounting principles, but which are  not
required  for interim reporting purposes, have been condensed  or
omitted.  The accompanying financial statements should be read in
conjunction with the financial statements and notes thereto as of
December 31, 1997 contained in the Company's Form 10-KSB.


NOTE 2 - EARNINGS (LOSS) PER SHARE

Per  share information is computed based on the weighted  average
number of shares outstanding during the period.