SECURITIES AND EXCHANGE COMMISSION
                         WASHINGTON, DC 20549
                               FORM 10-Q
           QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
                OF THE SECURITIES EXCHANGE ACT OF 1934

FOR QUARTER ENDED: June 30, 1997    COMMISSION FILE #: 2-67918-NY

                      MIKROS SYSTEMS CORPORATION
                      --------------------------   
          (Exact Name of Registrant as Specified in Charter)

          DELAWARE                            14-1598-200
          --------                            -----------  
(State or Other Jurisdiction of    (I.R.S. Employer Identification#)
 Incorporation or Organization)

                3490 U.S. Route 1, Princeton, NJ 08540
                --------------------------------------     
     (Address of Principal Executive Offices, Including Zip Code)

   Registrant's Telephone Number, Including Area Code: 609-987-1513

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.  [X]Yes    [ ]No

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

                                                 OUTSTANDING  AT
           CLASS                                   June 30, 1997 
----------------------------                     ----------------
COMMON STOCK, PAR VALUE $.01                       12,671,952 SHARES

CONVERTIBLE PREFERRED STOCK,                          655,000 SHARES
     PAR VALUE $.01

SERIES B PREFERRED STOCK                            1,131,663 SHARES
     PAR VALUE $.01

SERIES C PREFERRED STOCK                                5,000 SHARES
     PAR VALUE $.01

SERIES D PREFERRED STOCK                              690,000 SHARES
     PAR VALUE $.01
--------------------------------------------------------------------

<PAGE>
                      MIKROS SYSTEMS CORPORATION

                           TABLE OF CONTENTS



PART I - FINANCIAL INFORMATION                                 Page #

   ITEM I - FINANCIAL STATEMENTS

   Balance Sheets at June 30, 1997 and December 31, 1996
   (Unaudited)................................................. 1

   Statements of Operations for the Three Months and Six Months Ended
   June 30, 1997 and 1996 (Unaudited) ........................ 3

   Statements of Shareholders' Equity for the Years ended 
   1995 and 1996 and Six Months Ended June 30, 1997 
   (Unaudited)................................................. 4

   Statements of Cash Flows for the Three Months and Six Months Ended
   June 30, 1997 and 1996 (Unaudited)......................... 5

   Notes to the Financial Statements........................... 6


   ITEM II

   Management's Discussion and Analysis of Financial
   Condition and Results of Operations......................... 10



PART II - OTHER INFORMATION.................................... 12

<PAGE>
                      MIKROS SYSTEMS CORPORATION
                            BALANCE SHEETS
                              (UNAUDITED)


                                     JUNE 30,     DECEMBER 31,
          ASSETS                      1997            1996
------------------------------    ------------    ------------

CURRENT ASSETS
  Cash                            $   82,364      $  395,120 

  Accounts Receivable
    Government                       453,366         441,826 
    Trade                            273,774         198,298 

  Inventories                        309,787         153,192 

  Other Current Assets                20,976          16,508 
                                  ------------    ------------

TOTAL CURRENT ASSETS               1,140,267       1,204,944 
                                  ------------    ------------

FIXED ASSETS
  Equipment                          766,528         679,060 

  Furniture and Fixtures              59,207          59,207 

  Leasehold Improvements               8,396           3,408 
                                  ------------    ------------
                                     834,131         741,675 
  Less:  Accumulated Depreciation
         and Amortization           (576,113)       (535,547)
                                  ------------    ------------

FIXED ASSETS, NET                    258,018         206,128 
                                  ------------    ------------

OTHER ASSETS:
 Unbilled Receivables                 47,788          52,612 

 Patent Costs, Net                    15,197          15,785

 Other Assets                         24,534          17,825
                                  ------------    ------------
TOTAL OTHER ASSETS                    87,519          86,222
                                  ------------    ------------

TOTAL ASSETS                      $1,485,804      $1,497,294
                                  ============    ============

                   See Notes to Financial Statements

<PAGE>
                      MIKROS SYSTEMS CORPORATION
                            BALANCE SHEETS
                              (UNAUDITED)

           LIABILITIES AND                          JUNE 30,      DECEMBER 31,
    SHAREHOLDERS' EQUITY (DEFICIENCY)                 1997           1996
------------------------------------------         -----------   ------------
CURRENT LIABILITIES
  Accounts Payable                                 $  520,751     $  507,249 
  Notes Payable
    Bank                                                9,271          9,271 
    Related Parties                                   365,000         20,000
    Other                                             311,000         18,302
  Obligations under Capital Leases                     24,997         29,492 
  Accrued Payroll and Payroll Taxes                    38,437         50,922
  Accrued Interest                                      3,079          3,866
  Accrued Vacations                                    71,779         55,285
  Accrued Expenses                                    109,650        128,743
 Unliquidated Progress Payments and Other
  Customer Advances                                   764,466        507,471
                                                  ------------   ------------
TOTAL CURRENT LIABILITIES                           2,218,431      1,330,601 
                                                  ------------   ------------
NOTES PAYABLE
    Bank                                                5,367        10,017 
    Related Parties                                   162,500       527,500 
    Others                                            155,500       446,500 
OBLIGATIONS UNDER CAPITAL LEASES-NONCURRENT             2,126        15,585 
                                                  ------------  ------------
TOTAL LIABILITIES                                   2,543,924     2,330,203 
                                                  ------------  ------------
COMMITMENTS AND CONTINGENCIES
MANDATORILY REDEEMABLE SERIES C PREFERRED STOCK 
  par value $.01 per share, authorized 150,000
  shares, issued and outstanding 5,000 shares
  in 1997 and 1996                                     80,450        80,450 
                                                  ------------  ------------
SHAREHOLDERS' EQUITY (DEFICIENCY)
  Common Stock, par value $.01 per share,
  authorized 25,000,000 shares, issued and
  outstanding 12,671,952 shares in 1997 and
  11,846,952 in 1996                                  126,720       118,470 
  Preferred Stock, convertible,
  par value $.01 per share, authorized 2,000,000
  shares, issued and outstanding 655,000 shares
  in 1997 and 1,005,000 in 1996.                        6,550        10,050 
  Preferred Stock, Series B convertible, par value
  $.01 per share, authorized 1,200,000 shares, issued
  and outstanding 1,131,663 shares in 1997 and 1996    11,316        11,316 
  Preferred Stock, Series D, par value $.01 per share 
  690,000 shares authorized, issued and outstanding in
  1997 and 1996                                         6,900         6,900 

  Capital in excess of par                         10,244,454     10,218,548 

  Accumulated deficit                             (11,534,510)   (11,278,643)
                                                  ------------   ------------

TOTAL SHAREHOLDERS' EQUITY (DEFICIENCY)            (1,138,570)      (913,359)

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

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY         $1,485,804     $1,497,294
                                                  ============   ============

                       See Notes to Financial Statements
<PAGE>
                              MIKROS SYSTEMS CORPORATION
                               STATEMENTS OF OPERATIONS
                                      (UNAUDITED)

<TABLE>
<CAPTION>
                                         Three Months Ended,                  Six Months Ended,
                                     June 30, 1997  June 30, 1996      June 30, 1997   June 30, 1996
                                     -------------  -------------      -------------   -------------
                                     <C>            <C>                <C>             <C> 
Revenues:                            
 Equipment Sales                       $ 612,661       $  54,130        $ 998,065       $   90,125
 Contract Research and Development       594,279         212,446          784,563         
320,126
                                      -----------      ----------       ----------      ----------- 
Total Revenues                         1,206,940         266,576        1,782,628          410,251     

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

Cost of Sales:
  Equipment Sales                        511,955           4,000          809,669           36,312
  Contract Research and Development      365,234         297,926          491,523         
535,665
                                      -----------      ----------       ----------      -----------
Total Cost of Sales                      877,189         301,926        1,301,192          571,977
                                      -----------      ----------       ----------      -----------

Gross Margin                             329,751         (35,350)        (481,436)        (161,726)
                                      -----------      ----------       ----------      -----------

Expenses:
Research & Development                    16,810          57,210        125,819         119,697
Selling, General and Administrative      286,859         199,843          543,126         
397,796
Interest                                  35,814          30,354           68,358           47,272
                                      -----------      ----------       ----------      -----------

Total Operating Expenses                 339,483         287,407          737,303         
564,765
                                      -----------      ----------       ----------      -----------

Net Income (Loss)                        ($9,732)      ($322,757)       ($255,867)       ($726,491)
                                      ===========      ==========       ==========     
===========


Net (Loss) per common share               ($0.00)         ($0.04)          ($0.02)         ($0.10)
                                      ===========      ==========       ==========     
===========

Weighted average number of
 shares outstanding                   12,265,910       7,630,858       12,265,910       
7,537,941
                                      ===========     ===========       ==========     
===========
</TABLE>


                                 See Notes to Financial Statements             
     
<TABLE>
<PAGE>
                            MIKROS SYSTEMS CORPORATION
                 STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIENCY)
                                   (UNAUDITED)

                               Common            Preferred            Preferred
                                Stock              Stock               Stock B
                              $.01 PAR            $.01 PAR             $.01 PAR
                                VALUE              VALUE                 VALUE       
                              ---------  -------  ---------  --------  ---------  -------- 

                                           PAR                  PAR                 PAR
                               SHARES     VALUE     SHARES     VALUE     SHARES     VALUE
                              ---------  -------  ---------  --------  ---------  --------
                              <C>        <C>      <C>         <C>      <C>        <C>       
Balance-December 31, 1994     7,152,108  $71,521  1,005,000   $10,050  1,131,663   
$11,316
Year ended December 31, 1995:
Issuance of Common Stock        200,000    2,000
Net Loss  
                              ---------  -------  ---------  --------  ---------  --------
Balance December 31, 1995     7,352,108   73,521  1,005,000    10,050  1,131,663   
11,316
Year Ended December 31, 1996:
Issuance of Common Stock      2,582,844   25,829
Sale of Common Stock          1,912,000   19,120
Net Loss
                              ---------  -------  ---------  --------  ---------  --------
Balance-December 31, 1996    11,846,952  118,470  1,005,000   10,050   1,131,663   
11,316
Six Months Ended 
 June 30, 1997
Issuance of Common Stock        475,000    4,750                     
Conversion of Preferred Stock   350,000    3,500   (350,000) (3,500)
Net Loss
                              ---------  -------  ---------  --------  ---------  --------
Balance June 30, 1997        12,671,952 $126,720    655,000  $ 6,550   1,131,663  
$11,316
                              =========  =======  =========  =======   ========= 
========
                              Preferred
                               Stock D               Capital
                              $.01 PAR              in excess    Accumulated
                                VALUE                of Par        Deficit
                              ---------  -------    ---------    -----------
                                           PAR
                               SHARES     VALUE
                              ---------  -------    ---------    -----------
                              <C>        <C>        <C>          <C>             
Balance-December 31, 1994       690,000  $ 6,900    $9,237,864   ($9,183,329)
Year ended December 31, 1995:
Issuance of Common Stock                                10,500
Net Loss                                                            (647,673)
                              ---------  -------    ----------   ------------
Balance December 31, 1995       690,000    6,900     9,248,364   ( 9,831,002)
Year Ended December 31, 1996:
Issuance of Common Stock                                29,304
Sale of Common Stock                                   940,880
Net Loss                                                         ( 1,447,641)
                              ---------  -------    ----------   ------------
Balance-December 31, 1996       690,000    6,900    10,218,548   (11,278,643)
Six Months Ended   
 June 30, 1997 
Issuance of Common Stock                                25,906
Net Loss                                                            (255,867)
                              ---------  -------    ----------   ------------
Balance March 31, 1997          690,000  $ 6,900   $10,244,454  ($11,534,510)
                              =========  =======    ==========   ============
</TABLE>
                        See Notes to Financial Statements
<TABLE>
<PAGE>
                         MIKROS SYSTEMS CORPORATION
                           STATEMENTS OF CASH FLOW
                                (UNAUDITED)

                                                    Three Months Ended              Six Months Ended
                                            June 30, 1997       June 30, 1996   June 30, 1997  June 30,
                                                                                                 1996
                                           --------------      --------------   -------------  -------------
                                           <C>                 <C>              <C>            <C>
Cash Flows Provided (Used) by Operating
 Activities:
  Net Loss                                     ($9,732)          ($286,280)     ($255,867)   ($690,014)

Adjustments to reconcile Net Income (Loss)
 to Net Cash Provided (Used) by Operating
 Activities:
  Depreciation and Amortization                 20,736              15,704         41,154 31,408

Net Changes in Operating Assets and
 Liabilities:
 (Increase) Decrease in:
   Accounts Receivable                        (128,110)           (195,354)       (87,016)    
(126,140)
   Unbilled Receivables                              0             (16,208)         4,824       (16,526)
   Inventories                                (122,598)             40,154       (156,595)         342
   Other Current Assets                            400             (11,291)        (4,468)     (16,201)
   Other Assets                                 (4,719)                375         (6,708)         575
 Increase (Decrease) in:
   Accounts Payable                              8,214             (10,966)        13,502      73
   Accrued Payroll and Payroll Taxes           (10,068)              1,630        (12,485)     
21,248
   Unliquidated Progress Billings and
     Other Customer Advances                   114,902             (20,982)       256,995
100,000
   Other Liabilities and Interest              (86,399)             98,994         (3,386)      76,980
                                              ---------           ---------       --------       -------
 Net Cash Provided (Used) by Operations       (217,374)           (384,224)      (210,050)   
  (618,255)
                                              ---------           ---------      ---------     --------
 Cash Flows Provided (Used) by Investing
 Activities:
  Fixed Asset Purchases                        (22,509)            (50,115)       (92,456)    
(50,115)
  Patents                        0       (2,109)       0     (2,109)
                                              ---------           ---------      ---------       -------- 
Net Cash (Used) by Investing Activities:       (22,509)            (52,224)       (92,456)    
(52,224)

Cash Flows Provided (Used) by Financing
 Activities:
  Proceeds from Loans                                0             402,500           0    640,500 
  Proceeds from Exercise of Options
   And Warrants                                 14,844               5,275         30,656   5,650
  Repayment of Debt and Capital Leases         (15,596)             (3,325)       (40,906)     
(4,875)
                                              ---------           ---------     ----------     -------- 

Net Cash Provided (Used) by Financing
 Activities:                                      (752)            404,450        (10,250)     641,275
                                              ---------           ---------     ----------     --------
Net Increase (Decrease) in Cash               (240,635)            (31,998)      (312,756)    
(29,204)
Cash at Beginning of Period                    322,999              80,070        395,120  77,276
                                              ---------           ---------      ---------     --------
 
Cash at End of Period                         $ 82,364            $ 48,072      $ 82,364  $ 48,072
                                              =========           =========     ========  ========
Supplemental disclosure of cash flow
 information:
  Cash paid during the quarter for interest   $ 32,028            $ 28,846      $ 63,589  $
55,907
                                              =========           =========     ========  ========

                     See Notes to Financial Statements
</TABLE>
<PAGE>
                    
                    MIKROS SYSTEMS CORPORATION
                NOTES TO THE FINANCIAL STATEMENTS
                           (UNAUDITED)

NOTE A - BASIS OF PRESENTATION
------------------------------
As permitted by rules of the Securities and Exchange Commission applicable to
quarterly reports on Form 10-Q, these notes are condensed and do not contain
all disclosures required by generally accepted accounting principles.
Reference should be made to the financial statements and related notes
included in the Company's 1996 Annual Report on Form 10-K.

In the opinion of the management of Mikros Systems Corporation, the
accompanying financial statements contain all adjustments (consisting of only
normal recurring accruals) necessary to present fairly the Company's financial
position at June 30, 1997, the changes in deficiency in assets, and the
results of operations, and cash flows for the three-month and six month
periods ended June 30, 1997 and 1996.
           
The results disclosed in the Statements of Operations for the three and six
months ended June 30, 1997 are not necessarily indicative of the results to be
expected for the full year.


NOTE B - NOTES AND LOANS PAYABLE
--------------------------------
1) Outstanding Debt is summarized as follows:

                                            06/30/97      12/31/96
                                            --------      --------
  Notes Payable to Banks                    $ 14,638      $ 19,288
  Other Notes Payable                        466,500       464,802
  Related Parties                            527,500       547,500
                                            --------      --------
                                          $1,008,638    $1,031,590
                                          ==========    ==========

2)  Financing Transactions
--------------------------

1996 Financing
--------------
In a series of transactions from February through May 1996, the Company issued
secured promissory notes and warrants to raise an aggregate of $641,500
(including $131,250 from officers and directors).

The promissory notes are for a term of approximately eighteen months, bear
interest at 12% on the unpaid balance, and are secured by certain assets of
the Company.  In addition, the Company issued warrants to purchase five (5)
shares of Common Stock at $0.01 per share for each dollar of debt.  The value
of the warrants was immaterial and no accounting recognition was given to
their issuance.

In October 1996 all of the noteholders of the 1996 and the 1992-93 financings
agreed to a deferral of principal payments in exchange for the right to
convert outstanding debt to Common Stock of the Company at a rate of one (1)
share of stock for $1.00 of debt.  The Company determined that the fair value
of the conversion feature was immaterial.  Accordingly, no accounting
recognition has been given to this modification of terms.


Safeguard Scientifics (Delaware) Inc. (SSI)
------------------------------------------------------------
On November 15, 1996, the Company, all of its secured creditors from its 1996
and 1992-93 financings and SSI entered into an agreement.  Under the agreement
SSI paid $1,000,000 to the Company.  

-    SSI received:  1) 1,912,000 shares of Common Stock of the Company; 2) a
     warrant to purchase 2,388,000 shares of Common Stock at $0.65 per share;
     3) a warrant to purchase 3,071,000 shares at $0.78 per share; 4) a 75%
     interest in an exclusive, royalty-free, perpetual license of the AM
     technology in the United States, Canada and Mexico (through SSI's
     ownership in MBC); and 5) a 33 1/3% interest in the FM and AM technology
     (through SSI's ownership in 3D).  This transaction is more fully
     described below.

-    Two (2) new companies were formed, Data Design and Development
     Corporation (3D) and Mobile Broadcasting Corporation (MBC).  The Company
     received one-third of 3D in exchange for certain of its AM and FM
     technology.  SSI received one-third of 3D in exchange for a commitment
     to invest up to $1,000,000 in MBC.  The secured creditors received
     one-third of 3D and released their security interest in the technology
     transferred.  The Company received 25% of MBC for $50.  SSI received 75%
     of MBC for $200,000.

-    3D granted MBC an exclusive, royalty-free, perpetual license to the AM
     technology in the United States, Canada and Mexico.  3D granted the
     Company an exclusive, royalty-free, perpetual license to the FM
     technology in the United States, Canada and Mexico.  3D retained rights
     to the AM and FM technology in the rest of the world.  The Company and
     MBC entered into a consulting arrangement under which the Company will
     be paid for the development of the AM technology.  3D will own the
     rights to such technology.

The Company is unable to assign fair values to these transactions.  No amount
of cash consideration was considered attributable to a sale of the AM or FM
technology or to the license thereto.  No gain was recognized on the transfer
of the technology.  The entire amount of the cash consideration received from
SSI was recorded as a sale of Common Stock.
 
In connection with the sale of the Common Stock and the Warrants, the Company
granted to SSI certain piggyback and demand registration rights with respect
to the Common Stock and the Common Stock underlying the Warrants.  In
addition, the Company granted to SSI a right of first refusal pursuant to
which, subject to certain conditions, in the event the Company issues,
sells or exchanges any securities, it must first offer such securities to SSI
and such offer must remain open and irrevocable for 30 days.  Such right of
first refusal may only be waived in writing and terminates at such time as SSI
owns less than 10% of the Common Stock.
<PAGE>
Pursuant to the Purchase Agreement, as long as SSI owns 1% or more of the
Company's outstanding equity securities, on a fully-diluted basis, the Company
is obligated to, among other things: (I) maintain key man life insurance on
certain key employees of the Company, of which the Company is in the process
of obtaining such insurance; (ii) permit SSI to inspect the operations and
business of the Company; and (iii) fix and maintain the number of Directors on
the Board of Directors at eight members.  In addition, the Purchase Agreement
also provides that as long as SSI owns such 1%, the Company is subject to
certain negative covenants, including, among other things, restrictions on: 
(I) transactions with affiliates of the Company; (ii) certain indebtedness;
and (iii) amendments to the Company's Certificate of Incorporation and Bylaws.

In connection with the transaction, the Company entered into a voting
agreement pursuant to which each of Joseph R. Burns, Thomas J. Meaney, Wayne
E. Meyer, Frederick C. Tecce and John B. Torkelsen, each a director of the
Company (collectively, the "Management Shareholders"), agreed to vote an
aggregate of approximately 6,659,214 votes for the election of two designees
of SSI to the Board of Directors of the Company.


1992-93 Financing
-----------------
In a series of transactions consummated on October 27, 1992 and April 27,
1993, Joseph R. Burns, Thomas J. Meaney, Wayne E. Meyer, Frederick C. Tecce,
and John B. Torkelsen, individually and not as a group, (collectively referred
to herein as the "Investors") acquired certain loan and equity interests in
the Company from other debt and equity holders. 

Pursuant to such transactions, each of the Investors acquired, in
consideration of an aggregate of $250,000 (each of the Investors individually
paying $50,000 in cash), twenty percent of (I) 50,000 shares of Common Stock,
$.01 par value ("Common Stock"), of the Company (ii) promissory notes of the
Company in the aggregate principal amount of $916,875 (collectively, the
"Investor Notes), (iii) warrants ("Series C Warrants") to purchase 97,500
shares of Series C Preferred Stock, $.01 par value, of the Company and (iv)
certain loan and equity rights in the Company, including without limitation,
rights under loan agreements, an investment agreement, a note purchase
agreement, and all documents related to such agreements.

Pursuant to such loan documents, among other things, the Company is prohibited
from paying dividends on its Common Stock, the Company has granted to the
Investors a security interest in all of the assets of the Company and the
Investors have the right to designate 2/7ths of the Board of Directors of the
Company, which right has not been exercised.  Each of Messrs. Burns, Meaney,
Meyer and Torkelsen is a Director of the Company.

In December 1993, the Investors agreed to reduce the amounts owed by the
Company under the Investor Notes, including unpaid interest,  in exchange for
shares of Common Stock and Preferred Stock issued by the Company. In return
for a reduction in debt of $416,875 and accrued interest of $273,125, the
Company issued 2,750,000 shares of Common Stock and 690,000 shares of Series D
Preferred Stock which provides for an annual cumulative dividend of $.10 per
share. The Investor Notes were modified to provide for principal payments in
sixteen quarterly installments beginning January 1, 1994 and ending on October
1, 1997.



Interest on the unpaid principal balance is due in quarterly installments
beginning on March 31, 1994. As additional consideration for the modification
of such loans, the Company extended the exercise period for the Series C
Warrants until April 25, 1999.  As of December 31, 1996, the Company was in
arrears on six quarterly principal payments.  In October 1996, the Investors
authorized deferral of the remaining $312,500 of principal payments until 1998
(See Note D).


NOTE C - INVENTORIES
--------------------
Inventories at June 30, 1997 are stated at the lower of cost or market,
computed on the first-in, first-out method.  


NOTE D - RECLASSIFICATION
-------------------------
Certain prior year amounts have been reclassified to conform with the 1997
presentation.


<PAGE>
Part I. Item II.

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

REVENUE
-------
Total revenues were $1,206,940 for the quarter ended June 30, 1997 compared to
$266,576 for the same period in 1996 an increase of 452.7%.  For the six
months ended June 30, 1997 revenues were $1,782,628 compared to $410,251 for
the same period in 1996, an increase of 434.5%.  For the quarter and six
months ended June 30, 1997, equipment revenue was $612,661 and $998,065,
respectively, as compared to $54,130 and $90,125 for the same periods in 1996.
These increases are due to revenue from shipments in 1997 to the U.S. Navy of
AN/USQ-120 data terminal sets.  Contract research and development revenues
were $594,279 and $784,563 for the quarter and six months ended June 30, 1997
compared to $212,446 and $320,126, respectively for the same periods in 1996. 
These increases are due mainly to higher activity on commercial contracts in
1997 than in 1996.  


COST OF SALES
-------------
Equipment cost of sales for the three months ended June 30, 1997 and June 30,
1996 was $511,955 and $4,000, respectively.  For the six months ended June 30,
1997 and June 30, 1996, such cost was $809,669 and $36,312, respectively. 
Contract research and development cost of sales for the three and six months
ended June 30, 1997 was $365,234 and $491,523, respectively.  For the same
periods in 1996, such costs were $297,926 and $535,665, respectively.  As a
percentage of sales, cost of sales in 1996 was higher than in 1997 primarily
because of unabsorbed fixed overhead costs in 1996 due to low revenue volume.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
--------------------------------------------
Selling, General & Administrative expenses were $286,859 for the quarter ended
June 30, 1997 compared to $199,843 for the same quarter in 1996 due mainly to
higher legal and travel expenses.

For the six-month periods in 1997 and 1996, such expenses were $543,126 and
$397,796, respectively.

INTEREST EXPENSE
----------------
Interest expenses was $35,814 versus $30,354 for the quarters ended June 30,
1997 and 1996,respectively.  For the six months ended June 30, 1997 and June
30, 1996, interest expense was $68,358 and $47,272, respectively.  The higher
amounts in 1997 are due to higher notes payable than in 1996.

NET LOSS 
-----------------
Net loss for the quarter ended June 30, 1997 was $9,732 versus $322,757 for
the same quarter in 1996.  For the six months ended June 30, 1997 and 1996,
net loss was $255,867 and $726,491, respectively.  The lower losses are due to
higher revenues in 1997 than in 1996.





LIQUIDITY AND CAPITAL RESOURCES
-------------------------------
The Company's financial statements for the quarter ended June 30, 1997 have
been prepared on a going concern basis which contemplates the realization of
assets and the settlement of liabilities and commitments in the normal course
of business. 


The Company incurred a net loss of $9,732 for the quarter ended June 30,
1997, and as of June 30, 1997 had an accumulated deficit of $11,534,510.  At
June 30, 1997 the Company had negative working capital of $1,078,164 compared
to negative working capital of $125,657 at December 31, 1996.  For the quarter
ended June 30, 1997 the Company used $217,374 for operating activities. 
For the same period in 1996, the Company used $210,050.  The Company expects
to continue to incur substantial expenditures to expand its commercial
wireless communications business and has formed a strategic alliance with
Safeguard Scientifics (Delaware), Inc, as well as entered into a consulting
services agreement with Mobile Broadcasting Corporation (see 1996 Financing). 
In 1996, the Company completed a debt financing of $641,500 (see 1996
Financing).  In addition, the Company will consider the sale of additional
equity securities under appropriate market conditions, alliances or other
partnership agreements with entities interested in supporting the Company's
commercial and military programs, or other business transactions which would
generate resources sufficient to assure continuation of the Company's
operations and research programs.  At June 30, 1997 notes payable included
$954,000 to creditors who have authorized deferral to 1998 of any principal
repayment.

<PAGE>
Part II.    OTHER INFORMATION


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

a)  Exhibits.  None.
b)  Reports on Form 8-K.
    No reports on Form 8-K have been filed during the
    quarter for which this report is filed.

SIGNATURE

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

Mikros Systems Corporation
(Registrant)

Dated: August 14, 1997              /s/ Joseph R. Benek
                                        Joseph R. Benek
                                        Vice President, Finance
                                        and Chief Accounting Officer



[PREFERRED-MANDATORY]                           80,450
[PREFERRED]                                     24,766
[COMMON]                                       126,720
[OTHER-SE]                                  (1,290,056)
[TOTAL-LIABILITY-AND-EQUITY]                 1,485,804
[SALES]                                      1,782,628
[TOTAL-REVENUES]                             1,782,628
[CGS]                                        1,301,192
[TOTAL-COSTS]                                1,301,192
[OTHER-EXPENSES]                               668,945
[LOSS-PROVISION]                                     0
[INTEREST-EXPENSE]                              68,358
[INCOME-PRETAX]                               (255,867)
[INCOME-TAX]                                         0
[INCOME-CONTINUING]                           (255,867)
[DISCONTINUED]                                       0
[EXTRAORDINARY]                                      0
[CHANGES]                                            0
[NET-INCOME]                                  (255,867)
[EPS-PRIMARY]                                    (.02)
[EPS-DILUTED]                                    (.02)