SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

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

                       For the Quarter Ended June 27, 1998

                                       OR

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

                         Commission File Number 0-20666

                                 MICROTEST, INC.
                                 ---------------
             (Exact name of registrant as specified in its charter)


           Delaware                                             86-0485884
     ---------------------                                      ----------
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                               identification no.)

                   4747 N. 22nd Street, Phoenix, Arizona 85016
                   -------------------------------------------
              (Address of principal executive offices and Zip Code)

       Registrant's telephone number, including area code: (602) 952-6400
       ------------------------------------------------------------------

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
                                     -----     -----

As of July 31,  1998,  8,253,279  shares of the  registrant's  common stock were
outstanding.



                         This document contains 16 pages

                         -------------------------------
                                       1
<PAGE>
                                      INDEX
                                      -----

                                 MICROTEST, INC.

                                                                            Page
Facing Page                                                                  1

Index                                                                        2

PART I. FINANCIAL INFORMATION
-----------------------------

Item 1 - Financial Statements (Unaudited)

      Condensed Consolidated Balance Sheets                                  3

      Condensed Consolidated Statements of Income                            4

      Condensed Consolidated Statements of Cash Flows                        5

      Notes to Unaudited Condensed Consolidated Financial Statements        6-8

Item 2 - Management's Discussion and Analysis of Financial
      Conditions and Results of Operations                                  9-12

PART II. OTHER INFORMATION
--------------------------

Item 1 - Legal Proceedings                                                   12

Item 2 - Changes in Securities                                               12

Item 3 - Defaults Upon Senior Securities                                     12

Item 4 - Submission of Matters to a Vote of Security Holders               12-13

Item 5 - Other Information                                                   13

Item 6 - Exhibits and Reports on Form 8-K                                    13

Signatures                                                                   14

Exhibit 99 - Private Securities Litigation Reform Act of 1995 Safe
           Harbor Complaince Statement for Forward-Looking Statements      15-16

                                       2
<PAGE>

PART I.  FINANCIAL STATEMENTS

                                 Microtest, Inc.
                      Condensed Consolidated Balance Sheets
                        (In thousands, except share data)
<TABLE>
<CAPTION>
                                                                        June 27,      December 31,
                                                                    1998 (unaudited)      1997
                                                                    ----------------  ------------
                                 ASSETS
<S>                                                                    <C>               <C>     
CURRENT ASSETS:
      Cash and cash equivalents                                        $ 14,154          $ 11,547
      Accounts receivable - less allowance for doubtful                                  
         accounts of $456 and $892, respectively and less                                
         returns reserve of $1,404 and $1,073, respectively               8,326            12,083
      Inventories - less reserve for obsolescence of $512                                
         and $694, respectively                                           5,649             5,924
      Prepaid expenses                                                    1,492             1,459
      Income taxes receivable                                             1,956             2,258
      Deferred income taxes                                               2,216             2,216
                                                                       --------          --------
           Total current assets                                          33,793            35,487
                                                                                         
PROPERTY, PLANT AND EQUIPMENT - less accumulated                                         
      depreciation of $6,804 and $6,200, respectively                     3,554             3,543
                                                                                         
INTANGIBLES AND OTHER ASSETS                                              3,223             2,777
                                                                                         
DEFERRED INCOME TAXES                                                       133               133
                                                                       --------          --------
                                                                                         
TOTAL                                                                  $ 40,703          $ 41,940
                                                                       ========          ========
                                                                                         
                  LIABILITIES AND STOCKHOLDERS' EQUITY                                   
CURRENT LIABILITIES:                                                                     
      Accounts payable                                                 $  4,113          $  4,699
      Accrued liabilities                                                 3,155             4,130
      Accrued payroll and employee benefits                               1,172             1,017
                                                                       --------          --------
           Total liabilities                                              8,440             9,846
                                                                                         
COMMITMENTS AND CONTINGENCIES                                                            
                                                                                         
STOCKHOLDERS' EQUITY:                                                                    
      Common stock, $.001 par value - authorized, 15,000,000 shares;                     
         issued 8,206,467 and 8,193,320 shares, respectively                  8                 8
      Additional paid-in capital                                         32,794            32,710
      Retained earnings/(deficit)                                           214              (186)
      Common stock in treasury at cost - 144,150 and 34,939,                             
         respectively                                                      (753)             (438)
                                                                       --------          --------
           Total stockholders' equity                                    32,263            32,094
                                                                       --------          --------
                                                                                         
TOTAL                                                                  $ 40,703          $ 41,940
                                                                       ========          ========
</TABLE>

See notes to condensed consolidated financial statements

                                       3
<PAGE>

                                 Microtest, Inc.
             Condensed Consolidated Statements of Income (unaudited)
                      (In thousands, except per share data)
<TABLE>
<CAPTION>
                                                      Three Months Ended     Six Months Ended
                                                      -------------------   -------------------
                                                      June 27,   June 28,   June 27,   June 28,
                                                        1998       1997       1998       1997
                                                      --------   --------   --------   --------
<S>                                                   <C>        <C>        <C>        <C>     
TOTAL REVENUES                                        $ 11,125   $ 11,945   $ 20,840   $ 23,058

TOTAL COST OF SALES                                      4,452      5,004      8,225      9,351
                                                      --------   --------   --------   --------

GROSS PROFIT                                             6,673      6,941     12,615     13,707

OPERATING EXPENSES:
      Sales and marketing                                3,117      3,771      6,205      8,795
      Research and development                           1,798      2,185      3,512      4,220
      General and adminstrative                          1,144        908      2,110      2,146
                                                      --------   --------   --------   --------

           Total operating expenses                      6,059      6,864     11,827     15,161

INCOME/(LOSS) FROM OPERATIONS                              614         77        788     (1,454)

INVESTMENT INCOME                                          102         93        178        211
                                                      --------   --------   --------   --------

INCOME/(LOSS) BEFORE INCOME TAXES                          716        170        966     (1,243)

INCOME TAX PROVISION/(BENEFIT)                             175         38        251       (389)
                                                      --------   --------   --------   --------

NET INCOME/(LOSS)                                     $    541   $    132   $    715   $   (854)
                                                      ========   ========   ========   ========

BASIC EARNINGS PER SHARE:
      NET INCOME/(LOSS) PER SHARE                     $   0.07   $   0.02   $   0.09   $  (0.11)
      WEIGHTED AVERAGE COMMON SHARES                  ========   ========   ========   ========

      OUTSTANDING                                        8,127      8,132      8,165      8,131
                                                      ========   ========   ========   ========

DILUTED EARNINGS PER SHARE:
      NET INCOME/(LOSS) PER SHARE                     $   0.07   $   0.02   $   0.09   $  (0.11)
                                                      ========   ========   ========   ========
      WEIGHTED AVERAGE COMMON AND
      EQUIVALENT SHARES OUTSTANDING                      8,227      8,134      8,281      8,131
                                                      ========   ========   ========   ========
</TABLE>

See notes to condensed consolidated financial statements

                                       4
<PAGE>

                                 Microtest, Inc.
           Condensed Consolidated Statements of Cash Flows (unaudited)
                                 (In thousands)
<TABLE>
<CAPTION>
                                                                    Six Months Ended
                                                                 -----------------------
                                                                 June 27,       June 28,
                                                                   1998           1997
                                                                 --------      ---------
<S>                                                              <C>           <C>      
OPERATING ACTIVITIES:
      Net income/(loss)                                          $    715      $   (854)
      Adjustments to reconcile net income/(loss) to net cash
         provided by/(used in) operating activities:
           Depreciation and amortization                              658           756
           Changes in operating assets and liabilities:
             Accounts receivable                                    3,757         3,518
             Inventories                                              275        (1,206)
             Prepaid expenses and other assets                       (533)         (757)
             Accounts payable                                        (586)       (3,665)
             Accrued liabilities                                     (975)       (1,997)
             Accrued payroll and employee benefits                    155          (247)
             Income taxes receivable                                  302          (536)
                                                                 --------      --------

Net cash provided by/(used in) operating activities                 3,768        (4,988)

INVESTING ACTIVITIES:
      Purchases of equipment and leasehold improvements              (615)         (240)
                                                                 --------      --------

Net cash used in investing activities                                (615)         (240)

FINANCING ACTIVITIES:
      Purchase of treasury stock                                     (753)         --
      Proceeds from sale of common stock and treasury stock           207           258
                                                                 --------      --------

Net cash (used in)/provided by financing activities                  (546)          258
                                                                 --------      --------

INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS                    2,607        (4,970)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                     11,547        10,282
                                                                 --------      --------

CASH AND CASH EQUIVALENTS, END OF PERIOD                         $ 14,154      $  5,312
                                                                 ========      ========
</TABLE>

See notes to condensed consolidated financial statements

                                       5
<PAGE>

                                 MICROTEST, INC.
                               NOTES TO UNAUDITED
                   CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial  information  and the  instructions  to Form  10-Q and  Rule  10-01 of
Registration  S-X.  Accordingly,  they do not include all of the information and
notes  required  by  generally  accepted  accounting   principles  for  complete
financial  statements.  In  the  opinion  of  management,  all  adjustments  and
reclassifications  considered  necessary for a fair and comparable  presentation
have been included and are of a normal recurring  nature.  Operating results for
the three  months and the six months ended June 27,  1998,  are not  necessarily
indicative of the results that may be expected for the year ending  December 31,
1998. The accompanying  financial  statements should be read in conjunction with
the Company's most recent Annual Report and Form 10-K.

1.    BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

      A.   Principles of Consolidation - The consolidated  financial  statements
           include  the  accounts  of  Microtest,   Inc.  and  its  wholly-owned
           subsidiaries  (collectively,  the "Company").  The Company  develops,
           markets,  and  supports  products  that make it  easier  to  install,
           service, and manage local area networks ("LANs").

      B.   For interim reporting purposes,  the Company ends its quarters on the
           Saturday closest to the calendar quarter end, with the fourth quarter
           ending on December 31, 1998.

2.    COMMITMENTS AND CONTINGENCIES

      Future minimum rental payments due under  the Company's  office  operating
      leases are as follows:
                                                          (Amounts in
                                                           Thousands)
      1998                                                 $   462
      1999                                                     995
      2000                                                     842
      2001                                                     148
      2002                                                      12
                                                           -------
      Total minimum rental payments                        $ 2,459
                                                           =======

      The  Company is involved in certain  other legal  matters,  the outcome of
      which  is  currently  unknown.  Management  believes  that  the  Company's
      liability,  if  any,  will  not  have a  material  adverse  effect  on the
      Company's financial condition and results of operations.

                                       6
<PAGE>

3.    EARNINGS PER SHARE

      In  accordance  with SFAS No.  128,  Earnings  Per  Share,  the  following
      presents the computation of basic and diluted earnings per share:

                            Basic Earnings Per Share

<TABLE>
<CAPTION>
                                                       Three Months Ended          Six Months Ended
                                                      --------------------       --------------------
                                                      June 27,    June 28,       June 27,    June 28,
                                                        1998        1997           1998        1997
                                                      --------    --------       --------    --------
<S>                                                   <C>         <C>            <C>         <C>     
Net income/(loss)                                     $   541     $   132        $   715     $  (854)
                                                      =======     =======        =======     ======= 

Weighted average shares of common stock                                       
   outstanding - basic                                  8,127       8,132          8,165       8,131
                                                      =======     =======        =======     ======= 
Basic income/(loss) per share                         $  0.07     $  0.02        $  0.09     $ (0.11)
                                                      =======     =======        =======     ======= 
</TABLE>
                                                                              
                                                                              
                           Diluted Earnings Per Share                
<TABLE>
<CAPTION>
                                                       Three Months Ended          Six Months Ended
                                                      --------------------       --------------------
                                                      June 27,    June 28,       June 27,    June 28,
                                                        1998        1997           1998        1997
                                                      --------    --------       --------    --------
<S>                                                   <C>         <C>            <C>         <C>     
Net income/(loss)                                     $   541     $   132        $   715     $  (854)
                                                      =======     =======        =======     ======= 
                                                                              
Weighted average shares of common stock                                       
   outstanding                                          8,127       8,132          8,165       8,131
Add: dilutive potential of common shares                  100           2            116          --
                                                      -------     -------        -------     ------- 
Weighted average shares of common stock                                       
   outstanding  - dilutive                              8,227       8,134          8,281       8,131
                                                      =======     =======        =======     ======= 

Dilutive income/(loss) per share                      $  0.07     $  0.02        $  0.09     $ (0.11)
                                                      =======     =======        =======     ======= 
</TABLE>

4.   COMPREHENSIVE INCOME

     In June 1997, the Financial  Accounting  Standards  Board  ("FASB")  issued
     Statement of Financial  Accounting  Standards  ("SFAS") No. 130,  Reporting
     Comprehensive  Income,  which is effective for financial  statement periods
     ending after December 15, 1997 and establishes  standards for reporting and
     display of  comprehensive  income and its components  (revenues,  expenses,
     gains and losses) in a full set of  general-purpose  financial  statements.
     The  Company  has  operations  in  the  United  Kingdom  and  Germany.  All
     transactions  for the United  Kingdom  operations  are  denominated in U.S.
     dollars.  All  transactions  for the German  operations are  denominated in
     Deutsch marks. Comprehensive income was $541,000 and $714,000 for the three
     and six months ended June 27, 1998, respectively.

                                       7
<PAGE>

5.    SEGMENT REPORTING

      In June 1997, the FASB issued SFAS No. 131,  Disclosure  about Segments of
      an Enterprise and Related Information, which is effective for fiscal years
      beginning  after December 15, 1997 and  establishes  standards for the way
      that  public  business  enterprises  report  information  about  operating
      segments  in  annual   financial   statements   and  requires  that  those
      enterprises report selected information about operating segments.  It also
      establishes standards for related disclosures about products and services,
      geographic  areas and  major customers. The  Company does not believe that
      the  adoption  of  SFAS No. 131  will have a  significant  effect  on  its
      reporting of segment information.

6.    STOCK REPURCHASE

      On April 14, 1998, the Company's Board of Directors authorized the Company
      to repurchase up to 800,000 shares of its common stock,  or  approximately
      10% of all shares issued as of that date, for issuance under the Company's
      stock option and purchase plans. The stock is to be purchased from time to
      time on the open market as  conditions  permit.  To date,  the Company has
      repurchased 144,150 shares at an average price of $5.22 per share.

                                       8
<PAGE>

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

         This Quarterly Report on Form 10-Q contains forward-looking statements.
The  words  "believe,"   "expect,"   "anticipate,"  and  "project"  and  similar
expressions identify forward-looking statements, which speak only as of the date
the statement was made. Such  forward-looking  statements are within the meaning
of that term in Section  27A of the  Securities  Act of 1933,  as  amended,  and
Section 21E of the Securities Exchange Act of 1934, as amended.  Such statements
may  include,  but not be limited to,  projections  of revenue,  income or loss,
capital expenditures, plans for future operations, financing needs or plans, and
plans  relating to products or services of the Company,  as well as  assumptions
relating to the foregoing.

         Statements  in  Exhibit  99 to this  Quarterly  Report  on  Form  10-Q,
describe factors, among others, that could contribute to or cause actual results
to differ  materially from those expressed in such  forward-looking  statements.
Additional  factors that could cause actual  results to differ  materially  from
those   expressed  in  such   forward-looking   statements   are  set  forth  in
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations"  in the  Company's  Annual  Report on Form  10-K for the year  ended
December 31, 1997.

Results of Operations
                   Qtr. End            Qtr. End      Y-T-D                Y-T-D
(in thousands)      6/27/98   Change    6/28/97     6/27/98    Change    6/28/97
--------------------------------------------------------------------------------
Total Revenues      $11,125   (6.9%)    $11,945    $ 20,840    (9.6%)   $ 23,058

During both the  quarter  and six months  ended June 27,  1998,  total  revenues
decreased  compared  to the  quarter  and six  months  ended  June 28,  1997 due
primarily to a decrease in sales of certain products to several of the Company's
product  distributors  that were  impacted  by the  anticipation  of new product
releases  which  were  delayed  until  late  in  the  second  quarter  of  1998.
Additionally,  there  was a  general  weakness  in sales to the  Company's  Asia
Pacific  product  distributors,  which has  impacted  the  results of the entire
industry segment.

                  Qtr. End            Qtr. End      Y-T-D                Y-T-D
(in thousands)     6/27/98   Change    6/28/97     6/27/98    Change    6/28/97
--------------------------------------------------------------------------------
Gross Profit       $ 6,673   (3.9%)    $ 6,941    $ 12,615    (8.0%)   $ 13,707
% of Total
Revenues              60.0%               58.1%       60.5%                59.5%

Gross profit  decreased  in absolute  dollars but  increased as a percentage  of
total  revenues  during the three months ended June 27, 1998, as well as the six
months  ended June 27,  1998,  as  compared  to the same  periods  in 1997.  The
decrease in absolute  dollars was due to the decrease in revenues.  Gross profit
as a percent  of  revenues  improved  slightly  during the  second  quarter  and
year-to-date due to a change in product mix.

                                       9
<PAGE>

                  Qtr. End            Qtr. End      Y-T-D                Y-T-D
(in thousands)     6/27/98   Change    6/28/97     6/27/98    Change    6/28/97
--------------------------------------------------------------------------------
Sales & Marketing  $ 3,117   (17.3%)   $ 3,771     $ 6,205    (29.4%)   $ 8,795
% of Total
Revenues              28.0%               31.6%       29.8%                38.1%

For both the quarter and six months  ended June 27,  1998,  sales and  marketing
expenses  decreased in absolute  dollars and as a percentage  of total  revenues
compared to the same  periods in 1997.  These  decreases  are  primarily  due to
synergies  created from the integration of Logicraft  Information  Systems,  now
doing business as Microtest  Enterprise  Group ("MEG").  MEG was acquired during
the fourth quarter of 1996 and was not fully integrated into Microtest until the
third  quarter  of 1997.  The  integration  of MEG  into  Microtest  included  a
significant reduction in headcount during the first and second quarters of 1997.
Additionally,  the Company  implemented  new cost  control  measures  during the
second half 1997, including the area of sales and marketing.

                  Qtr. End            Qtr. End      Y-T-D                Y-T-D
(in thousands)     6/27/98   Change    6/28/97     6/27/98    Change    6/28/97
--------------------------------------------------------------------------------
Research &         $ 1,798  (17.7%)    $ 2,185     $ 3,512    (16.8%)   $ 4,220
Development        
% of Total
Revenues              16.2%               18.3%       16.9%                18.3%

Research  and  development  expenses  decreased  in  absolute  dollars  and as a
percentage of total  revenues in the quarter and six months ended June 27, 1998,
compared with the same periods in 1997.  The decrease  stems  primarily from the
capitalization  of software  development costs during the first half of 1998 for
new products.  The Company capitalized  approximately $588,000 and $0 during the
six months ended June 27, 1998 and June 28, 1997, respectively. These costs will
be amortized over the life of the associated  products of  approximately  two to
four years as a charge to cost of goods  sold.  These  amortization  charges may
result in lowering the Company's net income in future periods.

                  Qtr. End            Qtr. End      Y-T-D                Y-T-D
(in thousands)     6/27/98   Change    6/28/97     6/27/98    Change    6/28/97
--------------------------------------------------------------------------------
General &          $ 1,144    26.0%     $ 908      $ 2,110    (1.7%)    $ 2,146
Administrative      
% of Total
Revenues              10.3%               7.6%        10.1%                 9.3%
                               
General and administrative expenses increased in both absolute dollars and as a
percentage  of total  revenues  during the second  quarter  ended June 27, 1998,
compared to the same period in 1997,  but decreased in absolute  dollars for the
six months  ended June 27,  1998 as  compared  to the six months  ended June 28,
1997. The increase during the second quarter of 1998 was mainly the result of an
increase in bad debt  expense  during the quarter.  The decrease  during the six
months  ended June 27, 1998 was due  primarily

                                       10
<PAGE>

to a decrease in personnel and other  administrative  costs  attributable to the
integration  of MEG and  cost  control  measures  implemented  during  1997,  as
previously mentioned.

                  Qtr. End            Qtr. End      Y-T-D                Y-T-D
(in thousands)     6/27/98   Change    6/28/97     6/27/98    Change    6/28/97
--------------------------------------------------------------------------------
Income Taxes        $ 175    360.0%     $ 38        $ 251     164.5%     ($ 389)

Effective Tax Rate   24.4%              22.4%        26.0%                 31.3%

The  Company's  effective tax rate  remained  relatively  flat during the second
quarter and six months ended June 27, 1998,  compared to the same periods of the
preceding year. The difference  between the effective tax rate and the statutory
rate is mainly  attributable  to foreign  sales  corporation  tax  benefits  and
research and development income tax credits.

                  Qtr. End            Qtr. End      Y-T-D                Y-T-D
(in thousands)     6/27/98   Change    6/28/97     6/27/98    Change    6/28/97
--------------------------------------------------------------------------------
Net Income/(Loss)   $ 541    309.8%     $ 132       $ 715     183.7%     ($ 854)
% of Total
Revenues              4.9%                1.1%        3.4%                (3.7%)

Net income  increased  in both  absolute  dollars and as a  percentage  of total
revenues for the second  quarter and first six months of 1998 as compared to the
same periods of 1997.  This increase is due primarily to a significant  decrease
in  operating  expenses  for the quarter  and six months  ended June 27, 1998 as
compared  with the  quarter and six months  ended June 28,  1997.  As  discussed
above,  MEG was fully  integrated  into  Microtest  during  the second and third
quarters of 1997. The integration  included a significant  headcount  reduction.
Also,  the Company's  implementation  of new cost control  measures  during 1997
aided in the decrease in operating expenses.

Liquidity and Capital Resources
-------------------------------

The Company has financed its operations  primarily  through operating cash flows
and  equity  financings.  At June  27,  1998,  the  Company  had  cash  and cash
equivalents of $14.2 million.  This  represents a $2.6 million  increase in cash
equivalents  during the six months  ended June 27,  1998,  due  primarily to the
collection of accounts receivable.

During the second quarter of 1997, the Company obtained a $10 million  unsecured
revolving  credit  facility  with Bank of America,  which is to be utilized  for
general corporate and working capital  purposes.  The credit facility carries an
interest  rate equal to Bank of  America's  "Reference  Rate" plus 1.50%.  Major
covenants of the credit  facility  include:  (i) the Company,  on a consolidated
basis, not incurring a net and operating loss in two consecutive quarters;  (ii)
the Company  maintaining a modified quick ratio of no less than 1.50%; (iii) the
Company  maintaining  a Tangible Net Worth of no less than 90% of the  Company's
Tangible Net Worth at December 31, 1996; and (iv) the Company not permitting its
total  liabilities  to exceed 0.75 times  Tangible  Net Worth.  No amounts  were
outstanding  under this credit  facility and the Company was in compliance  with
all loan covenants at June 27, 1998.

                                       11
<PAGE>

Capital   expenditures   during  the  six  months   ended  June  27,  1998  were
approximately  $615,000,  the  majority of which was for  computer  hardware and
software  and  leasehold  improvements.  The  Company's  capital  budget for the
remaining  two  quarters  of  1998 is  approximately  $100,000,  which  includes
software,  hardware,  leasehold  improvements  and  other of  $10,000,  $40,000,
$40,000, and $10,000, respectively.

Management  believes cash flows from  operations  and  available  cash under the
credit  facility will be sufficient to meet the cash needs of the Company in the
foreseeable future.

Year 2000 Issues
----------------

As with other organizations, some of the Company's computer programs, as well as
those of its vendors,  were originally  designed to recognize  calendar years by
their last two digits. Calculations performed using these truncated fields would
not work  properly  with dates from the year 2000 and  beyond.  The  Company has
initiated  efforts to remedy  this  situation  and  expects  all  programs to be
corrected and tested prior to the year 2000.  The Company is also in the process
of  obtaining  year 2000  compliance  data on all of its vendors.  To date,  the
Company has incurred capital  expenditures of approximately  $198,000 related to
this  project.  The Company does not expect that the  incremental  costs of this
project  will  have a  material  adverse  effect on the  Company's  consolidated
financial  statements or results of operations in any future periods. All of the
Company's products are year 2000 compliant.

PART II.  OTHER INFORMATION

Item 1 - Legal Proceedings

The Company is from time to time  involved in legal  proceedings  of a character
normally incident to its business,  including various claims and pending actions
against the Company seeking damages.

Item 2. - Changes in Securities

         None

Item 3. - Defaults Upon Senior Securities

         Not applicable

Item 4. - Submission of Matters to a Vote of Security Holders

The Annual Meeting of  Shareholders of the Company was held on May 12, 1998. The
shareholders  elected  the  following  persons  to  serve  three-year  terms  as
directors of the Company:  Richard G. Meise and Steven G. Mihaylo. The votes for
and against (withheld from) each nominee were as follows:

                                       12
<PAGE>

Nominee                              Votes For                  Votes Withheld
Richard G. Meise                     7,807,209                  101,548
Steven G. Mihaylo                    7,811,495                  97,262

Roger C.  Ferguson,  William C.  Turner,  Dianne C.  Walker and Kent C.  Mueller
continued as directors following the meeting.

Additionally,   shareholders  voted  for  the  approval  of  the  1998  Director
Compensation Plan which sets forth the Board compensation paid by the Company to
non-employee   directors  and  authorizes  two  types  of  automatic  grants  of
nonqualified  stock options to all  non-employee  directors of the Company.  The
votes for, against and abstained from this proposal were as follows:

For:  7,121,826            Against: 534,316                   Abstained: 54,986

Item 5. - Other Information

         None

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

      a) Exhibits

              Exhibit 99 - Private Securities Litigation Reform Act of 1995 Safe
      Harbor Compliance Statement for Forward-Looking Statements

      b) Reports on Form 8-K

         No Current Reports on Form 8-K were filed during the three months ended
June 27, 1998.

                                       13
<PAGE>

                                   SIGNATURES

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

                                 MICROTEST, INC.
                                 ---------------
                                   Registrant



Date: July 31, 1998                                /s/ Richard G. Meise
                                                   ---------------------------
                                                   Richard G. Meise
                                                   Chief Executive Officer and
                                                   Chairman of the Board



Date: July 31, 1998                                /s/ Charles V. Mihaylo
                                                   ---------------------------
                                                   Charles V. Mihaylo
                                                   President and
                                                   Chief Operating Officer


Date: July 31, 1998                                /s/ John J. O'Block
                                                   ---------------------------
                                                   John J. O'Block
                                                   Chief Financial Officer

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