SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  ------------

                                   FORM 10-QSB
   (Mark One)
      (X)      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                      THE SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended June 30, 1998


      (  )     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 0-17018

                         STRATFORD AMERICAN CORPORATION
        (Exact name of small business issuer as specified in its charter)

           Arizona                                       86-0608035
(State or other jurisdiction of                       (I.R.S. Employer
incorporation or organization)                        Identification No.)

2400 E. Arizona Biltmore Circle, Building 2, Suite 1270, Phoenix, Arizona  85016
(Address of principal executive offices)                              (Zip Code)

Registrant's telephone number, including area code:               (602) 956-7809

(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 reports),  and (2) has been
subject to such filing requirements for the past 90 days.        Yes X  No
                                                                    ---   ---

At June 30, 1998,  5,871,787 shares of the issuer's common stock were issued and
outstanding.
<PAGE>
                         STRATFORD AMERICAN CORPORATION

                                      INDEX


PART I.    FINANCIAL INFORMATION

ITEM I.    FINANCIAL STATEMENTS

Condensed Consolidated Balance Sheet as of June 30, 1998                      3

Condensed Consolidated Statements of Operations for the three and six months
       ended June 30, 1998 and 1997                                           4

Condensed Consolidated Statements of Cash Flows for the six months
       ended June 30, 1998 and 1997                                           5

Notes to Condensed Consolidated Financial Statements                          6

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
           CONDITION AND RESULTS OF OPERATIONS                                7



PART II.   OTHER INFORMATION

ITEM 6.    EXHIBITS AND REPORTS ON FORM 8-K                                   8


Signatures                                                                    9
                                       2
<PAGE>
                 STRATFORD AMERICAN CORPORATION AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEET
                                  JUNE 30, 1998
                                   (unaudited)
<TABLE>
<CAPTION>
                                     ASSETS
<S>                                                                  <C>         
Cash and cash equivalents                                            $    447,000
Receivables:
    Trade, less allowance for doubtful accounts of $118,000               402,000
    Mortgages                                                              61,000
                                                                     ------------
                                                                          463,000
                                                                     ------------

Prepaid expenses                                                          288,000
Revenue earning vehicles, net                                              48,000
Property and equipment, net                                               339,000
Deposits                                                                  193,000
Other assets                                                              195,000
Franchise rights, less accumulated amortization of $129,000               253,000
                                                                     ------------

    Total assets                                                     $  2,226,000
                                                                     ============


                      LIABILITIES AND SHAREHOLDERS' EQUITY

Notes payable, secured by revenue earning vehicles                   $     44,000
Accounts payable                                                          913,000
Notes payable and other debt                                            1,505,000
Accrued interest                                                          194,000
Accrued liabilities                                                       333,000
                                                                     ------------

        Total liabilities                                               2,989,000
                                                                     ------------


Shareholders' equity (deficiency):
   Nonredeemable preferred stock, par value $.01 per share;
     authorized 50,000,000 shares, none issued
   Common stock, par value $.01 per share; authorized 100,000,000 
     shares; issued and outstanding 5,871,787 shares                       59,000
   Additional paid-in capital                                          26,803,000
   Retained earnings (deficit)                                        (27,614,000)
   Treasury stock, 29,500 shares at cost                                  (11,000)
                                                                     ------------

    Total shareholders' equity (deficiency)                              (763,000)
                                                                     ------------


    Total liabilities and shareholders' equity (deficiency)          $  2,226,000
                                                                     ============
</TABLE>
     See accompanying notes to condensed consolidated financial statements.
                                       3
<PAGE>
                 STRATFORD AMERICAN CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (unaudited)
<TABLE>
<CAPTION>
                                                         For the three months         For the six months
                                                             ended June 30,              ended June 30,
                                                           1998          1997           1998         1997
                                                           ----          ----           ----         ----
<S>                                                    <C>           <C>            <C>           <C>        
REVENUES:
  Vehicle rental activities                            $ 3,275,000   $ 3,735,000    $ 7,217,000   $ 8,124,000
  Interest and other income                                 20,000        34,000         45,000        61,000
                                                       -----------   -----------    -----------   -----------

                                                         3,295,000     3,769,000      7,262,000     8,185,000
                                                       -----------   -----------    -----------   -----------

EXPENSES:
  Vehicle rental operations                              2,863,000     3,327,000      5,759,000     6,606,000
  General and administrative                               166,000        90,000        223,000       292,000
  Depreciation and amortization                             54,000       367,000        128,000       853,000
  Interest                                                  51,000       183,000        113,000       414,000
                                                       -----------   -----------    -----------   -----------


                                                         3,134,000     3,967,000      6,223,000     8,165,000
                                                       -----------   -----------    -----------   -----------


NET INCOME (LOSS)                                      $   161,000   $  (198,000)   $ 1,039,000   $    20,000
                                                       ===========   ===========    ===========   ===========


Basic net income (loss) per share                      $      0.03   $     (0.03)   $      0.18   $      0.00
                                                       ===========   ===========    ===========   ===========

Weighted average number of common shares outstanding     5,871,787     5,805,120      5,871,787     5,736,612
                                                       ===========   ===========    ===========   ===========


Diluted net income (loss) per share                    $      0.03   $     (0.03)   $      0.18   $      0.00
                                                       ===========   ===========    ===========   ===========

Weighted average number of common and
  common equivalent shares outstanding                   5,905,120     5,805,120      5,905,120     5,969,945
                                                       ===========   ===========    ===========   ===========
</TABLE>
     See accompanying notes to condensed consolidated financial statements.
                                        4
<PAGE>
                 STRATFORD AMERICAN CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (unaudited)
<TABLE>
<CAPTION>
                                                                    SIX MONTHS ENDED JUNE 30,
                                                                    -------------------------
                                                                       1998          1997
                                                                       ----          ----
<S>                                                               <C>            <C>        
CASH FLOWS FROM OPERATING ACTIVITIES:
    Net income                                                    $ 1,039,000    $    20,000
    Adjustments to reconcile net income to net cash provided by
       operating activities:
       Depreciation and amortization                                  128,000        853,000
       Loss (Gain) on sale of revenue earning vehicles                (25,000)       128,000


    Changes in assets and liabilities:
      Decrease (Increase) in accounts and mortgages receivable        248,000        (85,000)
      Increase in other assets                                        (35,000)       (24,000)

      Decrease in accounts payable                                   (146,000)       (39,000)

      Increase (Decrease) in accrued liabilities                     (257,000)       133,000
                                                                  -----------    -----------

NET CASH PROVIDED BY OPERATING ACTIVITIES                             952,000        986,000
                                                                  -----------    -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
    Reduction to restricted cash                                                     558,000
    Proceeds from sales of revenue earning vehicles                   327,000      3,422,000
    Purchases of property and equipment                               (36,000)       (38,000)
    Purchases of revenue earning vehicles                                           (572,000)
                                                                  -----------    -----------

NET CASH PROVIDED BY INVESTING ACTIVITIES                             291,000      3,370,000
                                                                  -----------    -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
    Proceeds from revenue earning vehicle financing                                  528,000
    Payments on revenue earning vehicle financing                    (326,000)    (4,437,000)
    Proceeds from other debt                                                         395,000
    Payments on other debt                                           (638,000)      (501,000)
    Proceeds from issuance of common stock                                            30,000
                                                                  -----------    -----------

NET CASH USED FOR FINANCING ACTIVITIES                               (964,000)    (3,985,000)
                                                                  -----------    -----------

NET INCREASE IN CASH AND CASH EQUIVALENTS                             279,000        371,000

CASH AND CASH EQUIVALENTS, beginning of period                        168,000        173,000
                                                                  -----------    -----------

CASH AND CASH EQUIVALENTS, end of period                          $   447,000    $   544,000
                                                                  ===========    ===========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
    Interest paid during the period                               $   320,000    $   401,000
                                                                  ===========    ===========
</TABLE>
     See accompanying notes to condensed consolidated financial statements.
                                        5
<PAGE>
                 STRATFORD AMERICAN CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND 1997
                                   (unaudited)

1.   In the  opinion  of  the  Company,  the  accompanying  unaudited  condensed
     consolidated financial statements contain all adjustments,  consisting only
     of normal recurring adjustments,  necessary to present fairly its financial
     position as of June 30, 1998,  and the results of its  operations  and cash
     flows for the six months  ended June 30,  1998 and 1997.  The  accompanying
     condensed  consolidated  financial  statements and notes do not include all
     disclosures considered necessary for a fair presentation in conformity with
     generally accepted accounting principles. Therefore, it is recommended that
     these  accompanying  statements  be read in  conjunction  with the notes to
     consolidated  financial  statements  appearing in the Company's Form 10-KSB
     for the year ended December 31, 1997.

2.   The results of  operations  for the six months  ended June 30, 1998 are not
     necessarily indicative of the results to be expected for the full year. The
     vehicle rental business in Phoenix is seasonal. Historically, the months of
     February through May have had the higher revenues.

3.   On April 17, 1998, the Company's  Board of Directors  approved,  subject to
     shareholder approval, a fifteen-to-one reverse stock split of the Company's
     common stock. Upon shareholder  approval on July 8, 1998, the reverse stock
     split became  effective on July 20, 1998. All share  amounts,  share prices
     and net income (loss) per share have been retroactively adjusted to reflect
     this fifteen-to-one reverse stock split.
                                       6
<PAGE>
ITEM 2.       MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
-------------------------------------------------------------------------
              AND RESULTS OF OPERATIONS
              -------------------------

GENERAL
-------

              The Company was able to  recognize a  consolidated  profit for the
second quarter of 1998,  primarily due to its continued  ability to pass through
airport access charges to its car rental customers. As a result, the Company has
experienced improved  consolidated  profitability for the six month period ended
June 30,  1998.  The vehicle  rental  business  is  seasonal  with the months of
February  through May typically  representing  the highest revenue  months.  The
profit from  operations  generated for the first six months of the year reflects
this  seasonality.  The vehicle rental  business is also highly  competitive and
subject to the pressures of both the rental rates and fleet sizes of competitors
as well as the availability of a reasonably priced fleet.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

              The Company,  through Stratford American Car Rental Systems,  Inc.
(SCRS),  has access to a $3,000,000  credit line from a major bank,  including a
$2,000,000 line available for general  operational use, and a $1,000,000 line to
purchase  revenue  earning  vehicles.  In  addition,  the Company  continues  to
maintain already existing vehicle lines of credit from other major sources.

              SCRS  incurs a minimum of  $1,150,000  in airport  access  charges
yearly based on the level of car rental business recognized at all three airport
terminal locations.  Effective June 1997, SCRS began passing through most of its
airport access charges to car rental customers with no significant impact on its
level of business  activity.  SCRS collected  $684,000 in airport access charges
during the first six months of 1998  compared  to $22,000  collected  during the
same period last year. Collections are based on a percentage of airport revenues
recognized and are therefore higher during the first half of the year,  compared
to the  remaining  six  months  of the year.  The  Company  estimates  that with
continued success in implementing this policy, it will collect approximately 98%
of its airport access charges for the year.

              The Company  anticipates that with its current  profitability  and
available  financing,  it should  meet its  operational  cash flow needs for the
remainder of 1998.  However,  due to, among other things,  the factors described
above,  which are outside the Company's  control,  there are no assurances  that
either profitability or adequate cash flows from operations will be achieved.


RESULTS OF OPERATIONS - SIX MONTHS ENDED JUNE 30, 1998, COMPARED WITH SIX MONTHS
--------------------------------------------------------------------------------
ENDED JUNE 30, 1997
-------------------

The Company reported net income of $161,000 and $1,039,000  during the three and
six month periods ended June 30, 1998,  respectively,  compared to a net loss of
$198,000 and net income of $20,000  during the three and six month periods ended
June 30, 1997, respectively. Revenues decreased by $474,000 and $923,000 for the
three and six month periods,  respectively, due to the September 1997 closure of
four  off  airport  locations  determined  to be  unprofitable.  Vehicle  rental
operations  expenses  decreased  by $464,000  and $847,000 for the three and six
month periods, respectively,  primarily due to the Company's ability to bill and
collect  airport access charges from its customers which was not done during the
first five months of 1997.  General and  administrative  expenses  increased  by
$76,000  for  the  three  month  period  primarily  due to a  minority  interest
                                       7
<PAGE>
allocation  expense included in this expense category last year compared to none
made in the current  year.  General and  administrative  expenses  decreased  by
$69,000 for the six month period primarily due to the agreed upon elimination of
certain legal and professional fees accrued several years ago.  Depreciation and
amortization  expense  decreased  by $313,000 and $725,000 for the three and six
month periods, respectively, due to the significant reduction of revenue earning
vehicles  included in the rental  fleet and  depreciated  in 1998 as compared to
1997.  Interest expense decreased by $132,000 and $301,000 for the three and six
month periods,  respectively,  due to the significant  decrease in the number of
financed revenue earning vehicles in 1998 compared to 1997.

              VEHICLE  RENTAL  ACTIVITIES.  Revenues from rental car  activities
accounted for over 99% of total revenues in the first six months of 1998 and are
presently the most significant  revenue source for the Company.  A net operating
profit relating to these  operations was recognized  during the first six months
of  1998,  partially  due  to the  seasonality  of the  business  as  previously
discussed.

              OTHER ACTIVITIES. Real estate management activities continue to be
an insignificant  part of the Company's  ongoing  operations,  representing less
than 1% of total revenues in the first six months of 1998.

              SAFE  HARBOR  STATEMENT  UNDER THE PRIVATE  SECURITIES  LITIGATION
              ------------------------------------------------------------------
REFORM ACT OF 1995.
-------------------

                Certain   statements   contained  in  this   report,   including
statements containing the words "believes,"  "anticipates," "intends," "expects"
and words of similar import, constitute "forward-looking  statements" within the
meaning of the Private Securities  Litigation Reform Act of 1995 and are subject
to the safe harbors created thereby.  Such  forward-looking  statements  involve
known and unknown  risks,  uncertainties  and other  factors  that may cause the
actual results to be materially  different from the forward-looking  statements.
Such factors include,  among others,  the following:  SCRS's ability to maintain
the Dollar Rent A Car franchise,  the Company's ability to compete successfully,
the risk of  disruption  of air  travel  patterns,  the fact that the  Company's
operating  results are seasonal,  the risk that all of the foregoing  factors or
other factors could cause  fluctuations in the Company's  operating  results and
the price of the Company's common stock, and other risks detailed in this report
and from time to time in the  Company's  other filings with the  Securities  and
Exchange Commission.  Given these uncertainties,  readers should not place undue
reliance on such forward-looking statements.

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

Responses  to Items 1  through  5 are  omitted  since  these  items  are  either
inapplicable or the response thereto would be negative.

Item 6.       EXHIBITS AND REPORTS ON FORM 8-K
              --------------------------------

              (a)   EXHIBITS
                    --------

                    See index beginning on page 10

              (b)   REPORTS ON FORM 8-K
                    -------------------

                    There were no reports on Form 8-K filed for the three months
                    ended June 30, 1998.
                                       8
<PAGE>
              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.

                                   STRATFORD AMERICAN CORPORATION
                                   Registrant



Date:         August 14, 1998      By /s/ MEL L. SHULTZ
                                     ------------------
                                      Mel L. Shultz, President and Director



Date:         August 14, 1998      By /s/ TIMOTHY A. LAOS
                                     --------------------
                                     Timothy A. Laos, Chief Financial Officer
                                     (Principal Financial Officer and Principal
                                     Accounting Officer) for the quarter subject
                                     to this report
                                       9
<PAGE>
                                 EXHIBITS INDEX

Exhibits 27.1 and 27.2 are the only exhibits  originally filed with this report.
The Company hereby incorporates all other exhibits by reference pursuant to Rule
12b-32,  each of which  (except  Exhibit  3.3) was  filed as an  exhibit  to the
Company's  Registration  Statement on Form 10 which was filed July 22, 1988, and
amended on October 7, 1988, and December 8, 1988. Exhibit 3.3 was filed with the
Company's Registration Statement on Form S-1 on June 12, 1989.

NUMBER                           DESCRIPTION                            PAGE
------                           -----------                            ----

    3.1       Articles of Incorporation                                  N/A

    3.2       By-laws                                                    N/A

    3.3       Articles of Amendment to Articles of Incorporation         N/A

    4.1       Form of Common Stock Certificate                           N/A

    4.2       Form of Series "A" Preferred Stock Certificate             N/A

    4.3       Article IV of the Articles of Incorporation                N/A

    4.4       Article III of the Bylaws                                  N/A

   27.1       Financial Data Schedule - June 30, 1998                    11

   27.2       Financial Data Schedule - June 30, 1997                    12
                                       10