============================================================================
                     SECURITIES AND EXCHANGE COMMISSION
                           WASHINGTON, D.C. 20549


                                 FORM 10-QSB

[ ]   Quarterly report pursuant to Section 13 or 15(d) of the Securities 
      Exchange Act of 1934 

      For the quarterly period ended       June 30, 1998.

                                     OR

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

      For the transition period from                  to


                       Commission file number  1-13588

                           THE WIDECOM GROUP INC.
           (Exact Name of Registrant as specified in Its Charter)

           ONTARIO, CANADA                            98-0139939
  (State or Other Jurisdiction of                  (I.R.S. Employer
   Incorporation or Organization)                 Identification No.)

     72 DEVON ROAD, UNIT 17-18,                          L6T 5B4
     BRAMPTON, ONTARIO, CANADA
(Address of principal executive offices)               (Zip Code)

      Registrant's Telephone Number, Including Area Code (905) 712-0505


             Former Name, Former Address and Former Fiscal Year,
                        If Changed Since Last Report.

      Indicate by check X 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 periods 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 registrant's common stock as of 
August 13, 1998 was 5,978,128 shares.

      Transitional Small Business Disclosure Format.
                              Yes  ___   No  X 

<PAGE>  1 of 9

                            THE WIDECOM GROUP INC.
                                 FORM 10-QSB
                                    INDEX

                                                                 Page No.

Part I Financial Information

Item 1 - Financial Statements

Consolidated Balance Sheets -
      June 30, 1998 and June 30, 1997                                3

      Consolidated Statements of Operations -
      Three months ended June 30, 1998
      And June 30, 1997                                              4

      Consolidated Statements of Cash Flows -
      Three months ended June 30, 1998
      And June 30, 1997                                              5

      Notes to Consolidated Financial Statements                    6-7

Item 2 - Management's Discussion and Analysis of
         Financial Condition and Results of Operations               8

Signatures                                                           9

Exhibit 27 - Financial Data

<PAGE>  2 of 9

                        PART I FINANCIAL INFORMATION
                           THE WIDECOM GROUP INC.
                         CONSOLIDATED BALANCE SHEET
                         (in United States dollars)

<TABLE>
<CAPTION>
                                                        June 30,
                                               ---------------------------
                                                  1998             1997
                                                  ----             ----
                                               (unaudited)      (unaudited)

<S>                                            <C>              <C>
Assets

Current assets
  Cash and cash equivalents                    $   290,282      $ 2,103,870
  Accounts receivable                              601,255          873,054
  Research and development grants receivable             -          270,531
  Prepaid expenses                                  93,884           89,193
  Advance to related parties                       175,013          117,184
  Inventory (Note 3)                             1,685,576        1,394,975
                                               ----------------------------
      Total current assets                       2,846,010        4,848,807

Capital assets (Note 4)                          1,610,852        1,715,130

Investment in affiliates                           894,096        1,594,059
                                               ----------------------------

      Total assets                             $ 5,350,958      $ 8,157,996
                                               ============================

Liabilities and Shareholders' Equity

Current liabilities
  Bank indebtedness                            $   271,315      $   358,509
  Accounts payable and accrued liabilities         841,800        1,260,434
  Convertible debentures (Note 5)                  150,000          204,750
                                               ----------------------------
      Total current liabilities                $ 1,263,115      $ 1,823,693
                                               ----------------------------

Shareholders' equity

  Common shares                                $13,252,497      $12,622,985
  Contributed surplus                              159,825          159,825
  Deficit                                       (9,124,622)      (6,326,488)
  Cumulative translation adjustment               (199,857)        (122,019)
                                               ----------------------------
                                                 4,087,843        6,334,303
                                               ----------------------------
      Total liabilities and shareholders'
       equity                                  $ 5,350,958      $ 8,157,996
                                               ============================
</TABLE>

See accompanying notes to the consolidated financial statements.

<PAGE>  3 of 9

                           THE WIDECOM GROUP INC.
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                         (in United States dollars)

<TABLE>
<CAPTION>
                                                  For the three months ended
                                                  --------------------------
                                                   June 30,       June 30,
                                                     1998           1997
                                                   --------       --------
                                                  (unaudited)    (unaudited)

<S>                                               <C>           <C>
Product sales                                     $ 617,696     $   885,633
Cost of product sales                               163,689         221,408
                                                  -------------------------
Gross profit                                        454,007         664,225

Research and development grants                      99,887               -
Interest income                                      10,393          63,963
                                                  -------------------------
Net revenue                                         564,287         728,188
                                                  -------------------------

Expenses
  Research and development                                -          87,719
  Selling, general and administrative               714,947         968,973
  Interest and bank charges                           9,417           4,307
  Management fees and salaries                       75,493         117,603
  Amortization                                       88,122          96,736
  Foreign exchange loss                              21,182               -
                                                  -------------------------
Total operating expenses                            909,161       1,275,338
                                                  -------------------------

Operating income (loss)                            (344,874)       (547,150)
                                                  -------------------------

Equity in loss of affiliate                        (131,765)        (92,220)

Legal settlement costs                                    -        (375,000)
                                                  -------------------------

Earnings (loss) before extraordinary item          (476,639)     (1,014,370)
                                                  =========================

Extraordinary item, net of tax                            -               -
                                                  -------------------------

Net earnings (loss) for the period               $ (476,639)    $(1,014,370)
                                                 ==========================

Loss per common share before
 extraordinary item, basic and diluted           $    (0.08)    $     (0.18)
                                                 ==========================

Loss per common share, basic
 and diluted                                     $    (0.08)    $     (0.18)
                                                 ==========================

Weighted average number of shares outstanding     5,955,178       5,565,251
                                                 ==========================
</TABLE>

See accompanying notes to the consolidated financial statements.

<PAGE>  4 of 9

                           THE WIDECOM GROUP INC.

                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                         (in United States dollars)

<TABLE>
<CAPTION>
                                                For the three months ended
                                                --------------------------
                                                 June 30,        June 30,
                                                   1998            1997
                                                 --------        --------
                                                (Unaudited)     (Unaudited)

<S>                                             <C>             <C>
Cash provided by (used in)
 Operating activities
Loss for the period before
 Extraordinary item                             $(476,639)      $(1,014,370)
Add (deduct) items not requiring a cash outlay
  Amortization                                     88,122            96,736
  Foreign exchange loss                            21,182
  Equity in loss of affiliate                     131,765            92,220
Net changes in non-cash working capital
 balances related to operations
  (Increase) in accounts receivable               (41,731)         (116,563)
  Decrease in R & D grants receivable                   -           425,351
  (Increase) in inventory                        (311,505)         (194,937)
  Increase (decrease) in accounts payable and
   accrued liabilities                            194,361           (91,889)
  (Increase) decrease in prepaid expenses          (7,961)           11,127
                                                ---------------------------
                                                 (402,406)         (792,325)
                                                ---------------------------

Investing activities
  Purchase of capital assets                       (5,683)          (65,367)
                                                ---------------------------
                                                   (5,683)          (65,367)
                                                ---------------------------

Financing activities
  Increase (decrease) in bank indebtedness         77,899            28,558
  Shares issued for cash                                -         2,150,499
  Convertible debentures                                -           250,000
                                                ---------------------------
                                                   77,899         2,429,057
                                                ---------------------------

Effect of exchange rate changes on cash           (72,361)          (98,981)
                                                ---------------------------

Net increase (decrease) in cash during 
 the period                                      (402,551)        1,472,384

Cash and equivalents, beginning of period         692,833           631,486
                                                ---------------------------

Cash and equivalents, end of period             $ 290,282        $2,103,870
                                                ===========================
</TABLE>

See accompanying notes to the consolidated financial statements.

<PAGE>  5 of 9

                           THE WIDECOM GROUP INC.

Item 1.         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  Presentation of Interim Information

In the opinion of Management the accompanying unaudited financial statements 
include all normal adjustments necessary to present fairly the financial 
position at June 30, 1998, and the results of operations for the three 
months ended June 30, 1998 and 1997 and cash flows for the three months 
ended June 30, 1998. Interim results are not necessarily indicative of 
results for full year.

The condensed consolidated financial statements and notes are presented as 
permitted by Form 10-QSB and do not contain certain information included in 
the Company's audited consolidated financial statements and notes for the 
fiscal year March 31, 1998.

2.  Financial Statements

The consolidated financial statements include the accounts of the Company 
and its wholly owned subsidiary. All significant intercompany 
balances, transactions and stockholdings have been eliminated.

3.  Inventories

Inventories are summarized as follows:-

<TABLE>
<CAPTION>
                                June            June
                              30, 1998        30, 1997
                              --------        --------

      <S>                    <C>             <C>
      Raw materials          $  908,884      $  875,602
      Work in progress          158,203         388,624
      Finished goods            618,489         130,749
                             --------------------------
      Total inventories      $1,685,576      $1,394,975
                             ==========================
</TABLE>

<PAGE>  6 of 9

4.  Capital Assets

Capital assets consist of:

<TABLE>
<CAPTION>
                                   June 30, 1998                 June 30, 1997
                            ---------------------------     ---------------------------
                                           Accumulated                     Accumulated
                               Cost        Amortization        Cost        Amortization
                               ----        ------------        ----        ------------

<S>                         <C>             <C>             <C>             <C>
Machinery, plant and
 Computer equipment         $1,868,227      $  888,893      $1,592,823      $  486,201
  Furniture and fixtures       111,076          45,939          95,369          34,210
  Prototype and jigs           297,444         107,429         415,094         255,649
  Land                          57,830               -          61,121               -      
  Building under
   construction                318,536               -         326,783               -
                            ----------------------------------------------------------
                            $2,653,113      $1,042,261      $2,491,190      $  776,060
                            ==========================================================

Net book value                              $1,610,852                      $1,715,130
                                            ==========                      ==========
</TABLE>

5.  Convertible Debentures

On May 19, 1997, the Company completed a private offering of $250,000 of 
convertible debentures maturing on May 19, 1998. The convertible debentures 
bear interest of 8% per annum. In addition, 50,000 warrants also issued in 
conjunction with these convertible debentures. The holder of the debentures 
has the right to convert at a conversion price equal to the lower of $5 or 
80% of the average closing bid price of the Company's shares over the past 
20 trading days. On February 11, 1998, $50,000 principal plus accrued 
interest was converted into 58,967 common shares. The warrants are 
exercisable over 3 years at an exercise price of $4 per share. The value 
attributable to warrants is not material. Included in accounts payable is 
accrued interest on the debenture of $17,545. On April 24, 1998 the 
debenture holder converted another $50,000 principal plus interest in to 
68,850 of common shares.

The Company is currently in default for the repayment of its remaining 
$150,000 debentures that came due on May 19, 1998. 

6.  Contingent Liabilities

(a) Statement of claims have been filed against the Company in 1997 alleging 
    breach of contract and demanding specific performance, claiming 240,000 
    shares and 160,00 warrants (after the stock back-split). The President had 
    transferred 100,000 common shares issued to individuals who provided 
    marketing and related services in 1992 and 1993. The individuals had 
    attempted to transfer 172,860 common shares to third parties. The Company's 
    President has entered into an indemnification agreement with the Company 
    whereby he would return up to 160,000 common shares for cancellation to the 
    extent the Company is required to issue any such additional shares.

(b) The Company has a dispute with legal firm for non-payment of invoices for 
    legal services for total of approximately $77,000. The Company has accrued 
    approximately $32,000 for these services.

(c) A Statement of Claim has been filed against the Company in 1998 for breach 
    of sales and royalty agreement and breach of trademark and copyright issues 
    in the amount of approximately $15.85 million. The Company believes it has
    a good and meritorious defense to this claim.

Loss, if any, on the claims in paragraph (b) and (c) will be recorded when 
settlement is probable and the amount of the settlement is estimable.

<PAGE>  7 of 9

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

The Company's revenues are derived from product sales, which are recognized 
when products are shipped. Prior to January 1996 the company was eligible 
for substantial research and development grants.  As of January 1, 1996 
grants are made as a reduction of taxes payable. Research and development 
grants are cash payments and credits against taxes payable received or 
receivable from the Federal government as an incentive to conduct research 
and development in Canada.   As no taxes are payable in the quarter, no 
grants have been recognized.

During the quarter, the Company earned $10,393 interest on short-term 
investments compared to $63,963 earned in the same period of 1997.

Results of Operations

Quarter Ended June 30,1998 Compared to Quarter Ended June 30,1997

Revenues for the quarter ended June 30,1998 were $727,796, a decrease of 
$221,800 or 23.36% as compared to $949,596 for the quarter ended June 
30,1997.  Sales for the quarter ended June 30,1998 were $617,696, a decrease 
of $267,937 as compared to $885,633 for the quarter ended June 30,1997. 

Operating expenses for the quarter ended June 30,1998 were $909,161, a 
decrease of $366,177, or 28.71 %, as compared to $1,275,338 for the quarter 
ended June 30,1997.  Research and development expenses decreased from 
$87,719 for the quarter ended June 30,1997 to $nil for the quarter ended 
June 30,1998.  Selling, general and administrative expenses for the quarter 
ended June 30,1998, decreased by $254,026 and decreased as a percentage of 
revenues from 102.0% to 98.23%. The Company continues to incur legal, 
administration, and other related costs associated with its warrant call.

The Company's share of the loss incurred by the research and development 
consortium (3994340 Canada Inc.) that had been formed on October 2nd. 1996, 
for the quarter ended June 30,1998, amounted to $131,765 as compared to 
$92,220 for the quarter ended June 30,1997.

Liquidity and Capital Resources

The Company's primary cash requirements have been to fund research and 
development activities, the acquisition of inventories and to meeting 
operating expenses incurred in connection with the commercialization of its 
products. Until the Company's initial public offering, the Company had 
satisfied its working capital requirements principally through the issuance 
of debt and equity securities, government sponsored research and development 
grants and reimbursement and cash flow from operations. At June 30, 1998, 
the Company had working capital of $1,582,895, as compared to $3,025,114 at 
June 30, 1997.  However, the Company had only approximately $290,000 in 
unrestricted cash available.  Accordingly, the Company has experienced short 
term capital deficiencies during the last fiscal year and has entered into a 
letter of intent with an investment banking firm to arrange $2,000,000 in 
debt and equity financing during the second quarter of fiscal 1999.  There 
can be no assurance, however, that the financing will be consummated.  In 
addition, the Company is currently in default in payment of $150,000 of 
convertible debentures that were due May 18, 1998.  The Company is 
attempting to arrange for a purchase and extension of these notes or, in the 
alternative, will repay the notes out of the proceeds from the financing.

The Company's cash requirements in connection with the manufacture and 
marketing of its products will be significant. The Company does not have any 
material commitments for capital expenditures. The Company believes, based 
on its currently proposed plans and assumptions relating to its operations, 
projected cash flow from operations will be sufficient to satisfy its 
contemplated cash requirements for the foreseeable future. In the event that 
the Company's plans or assumptions change, or prove to be incorrect, or if 
the projected cash flows otherwise prove to be insufficient to fund 
operations (due to unanticipated expenses, delays, problems or otherwise), 
the Company could be required to seek additional financing sooner than 
currently anticipated. There can be no assurance that this additional 
financing will be available to the Company when needed on commercially 
reasonable terms, or at all. 

<PAGE>  8 of 9

Exhibits 27 - Financial Data Schedule


                                 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.

                                       THE WIDECOM GROUP INC.


August 14, 1998                        /s/Suneet S. Tuli
Date                                      Suneet S. Tuli,
                                          Executive Vice President


                                       /s/Willem J.Botha
                                          Willem J. Botha,
                                          Chief Financial Officer

<PAGE>  9 of 9