<PAGE>

                                    UNITED STATES
                          SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, D.C. 20549

                                      FORM 10-K
(Mark One)
[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE 
     SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
     For the fiscal year ended December 31, 1998
                               -----------------
[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE 
     SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
     For the transition period from                     to                
                                    ------------------      --------------

                          Commission file number 1-873-2
                                                 -------
                                ARMCO INC.
                  ----------------------------------------------------
                 (Exact name of registrant as specified in its charter)

               Ohio                                    31-0200500
-------------------------------          -----------------------------------
(State or other jurisdiction of          (I.R.S. Employer Identification No.)
incorporation or organization)

One Oxford Centre, 301 Grant Street, Pittsburgh, Pennsylvania      15219-1415
-------------------------------------------------------------      ----------
            (Address of principal executive offices)               (Zip Code)

Registrant's telephone number, including area code: 412/255-9800

Securities registered pursuant to Section 12(b) of the Act:
                                                     Name of Each Exchange
          Title of Each Class                         on Which Registered
          -------------------                         -------------------
      Class A Preferred Stock, without par value     New York Stock Exchange
      Class B Preferred Stock, $1 par value each     New York Stock Exchange
      Common Stock, $.01 par value each/             New York Stock Exchange
      Rights to Purchase Participating Preferred
        Stock of Class A Preferred Stock             New York Stock Exchange
      9% Senior Notes, due 2007                      New York Stock Exchange
      8 7/8% Senior Notes, due 2008                  New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

     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      
                                                    -----      -----
     Indicate by check mark if disclosure of delinquent filers pursuant to 
Item 405 of Regulation S-K (Section 229.405 of this chapter) is not contained 
herein, and will not be contained, to the best of registrant's knowledge, in 
definitive proxy or information statements incorporated by reference in Part 
III of this Form 10-K or any amendment to this Form 10-K. [X]

     The aggregate market value of voting stock held by nonaffiliates of Armco 
Inc. (assuming solely for purposes of this Form, that all members of 
registrant's Board of Directors are "affiliates") was approximately 
$698,241,346 as of February 26, 1999.

     As of the close of business on February 26, 1999, there were 107,912,948 
shares of Common Stock outstanding.
Documents incorporated by reference herein include:

     Annual Report to Shareholders for the year ended December 31, 1998 -- 
Parts I, II, and IV of this report.
     Proxy Statement for the 1999 Annual Meeting of Shareholders filed with 
the Commission under Rule  14a-6 of the Securities Exchange Act of 1934 in 
connection with the Company's 1999 Annual Meeting of Shareholders -- Part III 
of this report.

<PAGE>



                                     PART I


ITEM 1.     BUSINESS

General

     Armco Inc. ("Armco" or the "Company") was incorporated as an Ohio 
corporation in 1917 as a successor to a New Jersey corporation incorporated in 
1899.  Armco believes it is the largest domestic producer of stainless sheet 
and strip and electrical steels, based on tons shipped.  Armco's Sawhill 
Tubular Division manufactures a wide range of steel pipe and tubing products 
for use in the construction, industrial and plumbing fields.  The Company also 
owns Douglas Dynamics, L.L.C. ("Douglas Dynamics"), the largest North American 
manufacturer of snowplows for four-wheel drive light trucks.  Armco also 
operates an industrial park on the Houston, Texas ship channel.

     Armco's strategic objectives include enhancing and expanding its leading 
domestic position as a producer of specialty flat-rolled steels via 
incremental facility additions that add value through cost reductions or 
productivity gains, or through joint venture/partnership arrangements where 
value can be added without major capital outlay.  In addition, Armco is 
exploring possible acquisitions of "downstream," fabricating or parts-
producing businesses -- such as first and second operations like blanking, 
stamping, tool and die manufacturing, welding, fabrication and forming 
operations -- that will allow it to fully utilize its specialty steel 
technical, manufacturing and customer service expertise.  Armco also intends 
to expand its snowplow business by adding new snowplow and ice control 
products to reach new market segments as well as modestly expanding its 
industrial park facility.

Business Segments

     In 1998, Armco adopted Statement of Financial Standards No. 131, 
Disclosures about Segments of an Enterprise and Related Information.  As a 
result, Armco changed its segment presentation to reflect the operating 
segments and performance measurements evaluated regularly by its chief 
executive officer.

     The Company operates in three business segments: Specialty Flat-Rolled 
Steels, Tubular Products, and Other Businesses.  Information on the amounts of 
revenue, operating results and identifiable assets attributable to each of 
Armco's business segments, set forth in Note 8 of the Notes to Consolidated 
Financial Statements in Armco's Annual Report to Shareholders for the year 
ended December 31, 1998, is incorporated by reference herein.  

     Additional information about Armco's business segments is set forth in 
Management's Discussion and Analysis in Armco's Annual Report to Shareholders 
for the year ended December 31, 1998, which is incorporated by reference 
herein.

Specialty Flat-Rolled Steels Segment

     Armco's Specialty Flat-Rolled Steels businesses produce and finish flat-
rolled stainless, electrical and galvanized carbon steels at manufacturing 
operations located in Butler, Pennsylvania, and Coshocton, Dover, Mansfield 
and Zanesville, Ohio.  The Butler and Mansfield facilities produce both semi-
finished and finished specialty stainless and electrical steels in slab, hot 
band and sheet and strip form.  The Coshocton plant finishes stainless steel 
in sheet and strip form and the Zanesville plant finishes stainless and 
electrical sheet and strip.  The Dover facility coats carbon steel products at 
its 

                                      1
<PAGE>

galvanizing facility.  The segment also includes the results of European 
trading companies that buy and sell steel and manufactured steel products.

     The stainless and electrical steel industry is a relatively small but 
distinct segment of the overall steel industry that represented approximately 
2% of domestic steel tonnage but accounted for approximately 14% of domestic 
steel revenues in 1998.  These steels differ from basic carbon steel by their 
metallurgical composition.  Electrical steels have properties that make them 
desirable in the generation and distribution of electricity.  Stainless steels 
are made with a high alloy content, which permits their use in environments 
that demand exceptional hardness, toughness, strength and resistance to heat, 
corrosion or abrasion, or combinations thereof.  Unlike high-volume carbon 
steel, stainless and electrical steels are generally produced in relatively 
small quantities utilizing special processing techniques designed to meet more 
exacting specifications and tolerances.  Stainless and electrical steel 
products sell at higher prices and generate higher average profit margins than 
carbon steel products.

     Stainless steel contains elements such as chromium, nickel and molybdenum 
that give it the unique qualities of resistance to rust, corrosion and heat; 
high strength; good wear characteristics; natural attractiveness; and ease of 
maintenance.  Stainless steel is used in the automotive and aerospace 
industries, and in the manufacture of food handling, chemical processing, 
pollution control, medical and health equipment and other products where its 
combination of strength, durability and attractiveness is desirable.  
Electrical steels are iron-silicon alloys which, through special production 
techniques, possess unique magnetic properties that make them desirable for 
use as energy efficient material in such applications as power transmission 
and distribution transformers, electrical motors and generators.

     Armco expects that long-term demand for stainless steel will continue to 
grow due to increasing use in the manufacture of consumer durable goods and 
industrial applications.  Per capita stainless steel usage in many developed 
countries significantly exceeds per capita usage in the United States and 
Armco believes that this is an indication of the growth potential of demand 
for stainless steel in the United States.  In addition, the 1990 amendments to 
the Clean Air Act have resulted in the increasing use of corrosion-resistant 
materials in a number of applications for which stainless steel is well 
suited, including industrial pollution control devices and motor vehicle 
exhaust systems for use in the United States, where Armco now has the leading 
market share.  Another factor that Armco believes will affect demand 
positively is the increasing issuance of new car bumper-to-bumper warranties 
and the use of stainless steel in passenger restraint systems and other 
functional components.

     Armco produces flat-rolled stainless and electrical sheet and strip 
products that are used in a diverse range of consumer durables and industrial 
applications.  During the last three years, approximately 77% of Armco's sales 
of specialty flat-rolled steel has been finished stainless and electrical 
steels, 10% has been specialty semi-finished and 10% has been galvanized 
carbon steel.  The remaining sales in this segment of Armco's business are 
primarily related to the foreign subsidiaries that buy, warehouse, and sell 
specialty steel products.  Major markets served are industrial machinery and 
electrical equipment, automotive, construction and service centers.

     Armco is the leading producer of chrome stainless grades used primarily 
in the domestic market for automotive exhaust components.  Stainless steel, 
which formerly was not used in parts of the exhaust system other than the 
catalytic converter, is now used in the entire exhaust system, from manifold 
to tailpipe, by many auto manufacturers.  Armco has developed a number of 
specialty grades for this application.  Armco is also known for its "bright 
anneal" finish utilized for automotive and appliance trim and chrome grades 
used for cutlery, kitchen utensils, scissors and surgical instruments.  
Specialty chrome nickel grades produced by Armco are used in household 
cookware, restaurant, food processing and 

                                      2
<PAGE>

medical equipment.  Other Armco stainless products have various automotive, 
agricultural, heating, air conditioning and various industrial uses.

     Armco is the only United States manufacturer of a complete line of flat-
rolled electrical steel products.  It is also the only domestic manufacturer 
utilizing laser scribing technology.  In this process, the surface of 
electrical steel is etched with high-technology lasers that refine the 
magnetic domains of the steels, resulting in superior electrical efficiency.  
Major electrical product categories are:  Regular Grain Oriented ("RGO"), used 
in the cores of power and distribution transformers; Cold Rolled Non-Oriented 
("CRNO"), used for electrical motors, generators and lighting ballasts; and 
TRAN-COR[registered trademark]H, which is used in power transformers and is 
the only high permeability electrical steel made domestically.

     Additionally, Armco produces a full range of hot-dipped galvanized 
products primarily for use in the heating, ventilation and air conditioning 
("HVAC") market.

     Armco's order backlog for its Specialty Flat-Rolled Steels segment was 
$193.7 million at December 31, 1998, and $188.5 million at December 31, 1997.  
While substantially all of the orders on hand at year-end 1998 are expected to 
be shipped in 1999, such orders, as is customary in the industry, are subject 
to modification, extension or cancellation.  

     Armco's specialty steelmaking operations are located in Pennsylvania and 
Ohio.  Armco's Butler, Pennsylvania facility, which is situated on 1,300 acres 
with 3.2 million square feet of buildings, continuously casts 100% of its 
steel.  Melting takes place in three 175-ton electric arc furnaces that feed 
the world's largest (175-ton) argon-oxygen decarburization unit and a 175-ton 
vacuum degassing unit for refining molten metal that, in turn, feed two double 
strand continuous casters.  The melt capacity at Butler is approximately 
950,000 cast tons.  Butler operates a hot-strip mill, anneal and pickle units 
and two fully-automated tandem cold-rolling mills.  It also has various 
intermediate and finishing operations for both stainless and electrical 
steels.

     The finishing plant in Coshocton, Ohio, located on 650 acres, is housed 
in a 600,000 square-foot plant and has three Sendzimer mills and two Z-high 
mills for cold reduction,  four anneal and pickle lines, bell annealing 
furnaces, three bright anneal lines and other processing equipment, including 
temper rolling, slitting and packaging facilities.  

     The Mansfield, Ohio plant consists of a 1.4 million square-foot facility, 
including a melt shop with two electric arc furnaces (170-ton and 128-ton), a 
135-ton argon-oxygen decarburization unit, a thin-slab continuous caster, a 
six-stand hot strip mill, a five-stand tandem cold rolling mill and a pickle 
line. 

     Armco's Zanesville, Ohio plant, with 508,000 square feet of buildings on 
88 acres, is a finishing plant for some of the steel produced at Butler and 
Mansfield and has a Sendzimer cold-rolling mill, anneal and pickle lines, high 
temperature box anneal and other decarburization and coating units.

     The Dover, Ohio plant consists of a 600,000 square foot facility 
including a 48 inch galvanizing line, bell annealing furnaces and a temper 
mill.  The Dover plant has been the subject of sale negotiations over the past 
year.  However, no assurances can be given that a sale will be completed.

Tubular Products Segment

     This business segment consists of Armco's Sawhill Tubular Division.  
Sawhill Tubular manufactures a wide range of steel pipe and tubular products 
for use in the non-residential construction, 

                                      3
<PAGE>

industrial, plumbing and heating markets at plants in Sharon and Wheatland, 
Pennsylvania and Warren, Ohio.

     Armco's order backlog for its Tubular Products segment was $17.3 million 
at December 31, 1998 and $23.0 million at December 31, 1997.  The decrease in 
1998 was due to lower volume and selling prices as a result of oversupply in 
the market, including a high level of imported pipe.  While substantially all 
of the orders on hand at year-end 1998 are expected to be shipped in 1999, 
such orders, as is customary in this industry, are subject to modification, 
extension or cancellation.  Armco has been, and continues to be, in 
negotiations for the sale of Sawhill Tubular.  However, no assurances can be 
given that a sale will be completed.

Other Businesses

     The businesses currently included in this segment are described below.

     --  Douglas Dynamics, L.L.C. is the largest North American manufacturer 
of snowplows for four-wheel drive light trucks.  Douglas Dynamics, which has 
manufacturing plants in Rockland, Maine, Milwaukee, Wisconsin and Johnson 
City, Tennessee, sells its snowplows and ice control products under the brand 
names Western and Fisher through independent distributors in the United States 
and Canada.  Douglas Dynamics' sales depend on the level of four-wheel drive 
light truck sales and total snowfalls in major markets.

     --  Greens Port Industrial Park consists of approximately 500 acres on 
the Houston Ship Channel and leases land, buildings and rail car storage 
facilities to third parties and operates a deep water loading dock on the 
channel.

Employees

     At December 31, 1998, Armco had approximately 5,700 employees.  Most of 
Armco's domestic production and maintenance employees are represented by 
international, national or independent local unions, although some operations 
are not unionized.

     Armco has agreements with the United Steelworkers of America at its 
Mansfield and Dover plants, which terminate September 1, 1999, and at its 
Sharon plant, which terminates September 30, 1999.

Competition

     The Company faces intense competition from domestic and foreign steel 
producers, and also from producers of components and other products and 
manufacturers of competing products other than steel, including aluminum, 
plastics, composites and ceramics. Competition is based primarily on price, 
with factors such as reliability of supply, service and quality also being 
important in certain segments.

     In addition to existing competition, AK Steel Corporation, an integrated 
steel company has announced plans to enter the specialty steel market.  AK 
Steel is building a steel finishing facility in Rockport, Indiana that is 
expected to be completed in mid-1999.  When completed, this facility will 
provide AK Steel with substantial stainless steel processing and finishing 
capacity.  Increases in the production capacity and efficiency of other 
domestic producers, together with possible new entrants into the specialty 
steel market, are expected to result in intensified competition that could 
exert downward pressure on price and market share.

                                      4
<PAGE>

     Armco's competitors in the domestic galvanized carbon steel market 
include many of the large integrated and mini-mill flat rolled producers. 
Since 1989, significant flat-rolled mini-mill capacity has been constructed 
and these mini-mills now compete with integrated domestic steel producers in 
most flat-rolled steel markets. Mini-mills generally rely on less capital-
intensive hot metal sources, have smaller, non-unionized workforces resulting 
in lower employment costs per ton shipped and are relatively free of many of 
the employee, environmental and other obligations that have traditionally 
burdened non-mini-mill steel producers. There is significant flat-rolled and 
galvanized capacity under construction or announced with various planned 
commissioning dates in the next several years.

     Competition is also presented by foreign producers.  Some of these 
foreign producers have lower labor costs and are subsidized by their 
governments. Their decisions with regard to production and sales may be 
influenced more by political and social considerations than prevailing market 
forces. Many foreign steel producers continue to ship into the United States 
market despite decreasing profit margins. Depending on a number of market 
factors, including the strength of the dollar, import levels, and the 
effectiveness of U.S. trade laws, pricing of the Company's products could be 
adversely affected.

     In recent years, record levels of imports have depressed pricing on 
specialty steel products in the U.S.  In June 1998, Armco and other domestic 
producers of flat-rolled stainless sheet and strip products filed petitions 
with the U.S. Department of Commerce and the International Trade Commission 
charging eight foreign countries with violations of U.S. trade laws.  On July 
24, 1998, the U.S. International Trade Commission issued its preliminary 
finding that there has been injury to domestic producers.  On November 10, 
1998, the U.S. Department of Commerce announced preliminary results in the 
subsidy investigations, establishing countervailing duty rates for companies 
in France, Italy and South Korea.  On December 17, 1998, the U.S. Department 
of Commerce announced a preliminary determination on antidumping margins for 
companies in those countries, as well as in Germany, Japan, Mexico, Taiwan and 
the United Kingdom.  Final antidumping determinations are expected to be 
announced in the second quarter of 1999.  A finding that unfairly traded 
imports have caused injury to domestic producers could result in tariffs that 
may help slow the flood of imports.

     In addition, with respect to electrical steels, in mid-1999 the U.S. 
Department of Commerce and the U.S. International Trade Commission are 
expected to review existing antidumping and countervailing duties involving 
Italian and Japanese producers to determine whether these protections should 
be extended for another five years.  The failure to obtain or extend 
meaningful tariff protections for any of the products Armco sells could 
adversely affect prices and reduce profitability.

Raw Materials and Energy Sources

     Raw materials represent a major component of production costs in the 
steel industry.  The principal raw materials used by Armco in the production 
of steels are iron and carbon steel scrap, chrome and nickel and their 
ferroalloys, stainless steel scrap, silicon, molybdenum and zinc.  These 
materials are purchased in the open market from various outside sources.  
Since much of this purchased raw material is not covered by long-term 
contracts, availability and price are subject to world market conditions.  
Chrome, nickel and certain other materials in mined alloy form can be acquired 
only from foreign sources, many of them located in developing countries that 
may be subject to unstable political and economic conditions that might 
disrupt supplies or affect the price of these materials.  A significant 
portion of Armco's chrome and nickel requirements, however, is obtained from 
stainless steel scrap rather than mined alloys.  While certain raw materials 
have been in short supply from time to time, Armco currently is not 
experiencing and does not anticipate any problems obtaining appropriate 
materials in amounts sufficient to meet its production needs.  Armco also uses 
large amounts of 

                                      5
<PAGE>

electricity and natural gas in the manufacture of its products.  It is 
expected that such energy sources will continue to be available in the 
foreseeable future.

The Year 2000 Issue

     A discussion of Year 2000 issues is incorporated herein by reference from 
Management's Discussion and Analysis under the caption "The Year 2000 Issue" 
of the Annual Report to Shareholders for the year ended December 31, 1998.

Environmental Matters

     A discussion of environmental matters is incorporated herein by reference 
from Management's Discussion and Analysis and Notes to Consolidated Financial 
Statements under the captions "Environmental Matters," "Environmental 
Liabilities" and "Litigation and Environmental Matters", respectively, of the 
Annual Report to Shareholders for the year ended December 31, 1998.

Research and Development

     Armco carries on a broad range of research and development activities 
aimed at improving its existing products and manufacturing processes and 
developing new products and processes.  Armco's research and development 
activities are carried out primarily at a central technology center located in 
Middletown, Ohio.  This center is engaged in applied materials research 
related to iron and steel, non-ferrous materials and new materials.  In 
addition, the materials and metallurgy departments at each operating unit 
develop and implement improvements to products and processes that are directly 
connected with the activities of such operating unit.  Armco spent $14.2 
million, $15.3 million and $13.1 million, respectively, on research and 
development in the years  1998, 1997 and 1996.

Discontinued Operations

Armco Financial Services Group ("AFSG")

     Armco's investment in AFSG represents the net assets of its discontinued 
insurance and finance leasing businesses, which have been largely liquidated. 
The insurance companies, including Northwestern National Insurance Company 
(NNIC), have stopped writing new business and are being "run off." These 
insurance companies have not written any new business for retention since 1986 
except for an immaterial amount of guaranteed renewable accident and health 
business.  AFSG is accounted for as a discontinued operation under the 
liquidation basis of accounting, whereby future cash inflows and outflows are 
considered.

     The discontinued insurance companies estimate that 60% of future claims 
will be paid in the next five years and that substantially all of the claims 
will be paid by the year 2017.  The ultimate amount of the claims as well as 
the timing of the claims payments are estimated based on the annual review of 
loss reserves performed by independent and consulting actuaries.  There have 
been no charges recorded to income with respect to these companies since 1990.

     There are various pending matters relating to litigation, arbitration and 
regulatory affairs arising out of the runoff operations of the AFSG companies. 
In March 1997, North Atlantic Insurance Company, a group of international 
companies, previously affiliated with AFSG but sold in 1991, filed an 
application for voluntary liquidation in the United Kingdom.  As a result of 
this voluntary liquidation 

                                      6
<PAGE>

filing, certain claims have been asserted against NNIC by insureds of North 
Atlantic.  NNIC is defending these claims as well as pursuing related claims 
against third parties and North Atlantic.

     Armco management continues to believe, based on current facts and 
circumstances and the opinions of outside counsel and advisors, that future 
charges, if any, resulting from the liquidation of AFSG, including matters 
related to the voluntary liquidation of North Atlantic, will not be material 
to Armco's financial condition or liquidity.  However, it is possible that, 
due to fluctuations in Armco's operating results, future developments could 
have a material effect on the results of one or more future interim or annual 
periods.

ITEM 2.     PROPERTIES

     Armco owns and leases property primarily in the United States.  This 
property includes manufacturing facilities, offices and undeveloped property.  
The locations of Armco's principal plants and materially important physical 
properties are described in "ITEM 1. BUSINESS".  Armco believes that all its 
operating facilities are being adequately maintained and are in good operating 
condition.

ITEM 3.     LEGAL PROCEEDINGS

     There are various claims pending against Armco and its subsidiaries 
involving product liability, reinsurance and insurance arrangements, 
environmental, antitrust, employee benefits and other matters arising out of 
the conduct of the business of Armco.

     Environmental Proceedings.  Most environmental actions involving Armco 
     --------------------------
relate to alleged contamination at off-site treatment and disposal sites.  
Other claims sometimes arise from contractual obligations for properties Armco 
previously owned or leased and from regulatory actions.  In most of these 
cases, Armco is one of many companies who have been identified as potentially 
responsible parties ("PRPs").  In a few instances, Armco is one of only a few 
parties or is alleged to be solely liable.  It is routinely asserted that 
joint and several liability will be applied in such cases; thus, a single 
party could be held liable for all costs related to a site. However, Armco's 
experience has been that liability is apportioned on the basis of volume 
and/or toxicity of materials sent to a site and Armco expects that any 
ultimate liability would be apportioned among Armco and other financially 
viable parties.  Armco intends to assert all meritorious legal and equitable 
defenses that are available to it with respect to environmental matters.  
Based on Armco's analysis of the claims against it for contamination, 
including the presence of other PRPs, Armco's experience in resolving similar 
claims, and in some instances the type of contamination and expected 
remediation costs, Armco does not believe that its liability, if any, for 
these claims would materially impact its consolidated financial position or 
liquidity.  However, it is possible that due to fluctuations in Armco's 
operating results, future developments with respect to such matters could have 
a material effect on the results of operations in future interim or annual 
periods.

     On  February 27, 1995, the Ohio Environmental Protection Agency ("OEPA") 
issued a Notice of Violation ("NOV") to Armco's  Zanesville Operations 
alleging noncompliance with both a 1993 Order and various state regulations 
regarding hazardous waste management.  Armco continues to work with OEPA to 
achieve final resolution of this matter.  No proposed penalties were included 
in the NOV and Armco cannot reasonably estimate potential penalties, if any, 
based on current information.

     On September 30, 1998, the United States Environmental Protection Agency 
("USEPA") issued an order under Section 3013 of the Resource Conservation and 
Recovery Act requiring environmental investigation at Armco's Mansfield 
Operations.  The cost of the investigation is not expected to have a material 
effect on future, interim or annual results of operations.  Armco has filed a 
complaint against the 

                                      7
<PAGE>

USEPA in the U.S. District Court for the Northern District of Ohio, Eastern 
Division, which seeks injunctive relief and to set aside penalties during the 
pendency of the legal proceeding.    Armco's complaint challenges the legal 
basis for the Order, the lack of support in the administrative record for such 
an Order, and the lack of due process the Order provides to Armco in 
responding to modifications and expansions USEPA could make to the scope of 
work to be performed under the Order.  The complaint was filed on October 30, 
1998.  On December 30, 1998, USEPA filed a motion to dismiss Armco's complaint 
primarily on the basis that the Order was not final agency action and 
therefore, that the court lacked subject matter jurisdiction.  Armco is 
preparing a response to this motion.

ITEM 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     There were no matters submitted to a vote of the security holders of 
Armco during the fourth quarter of the year ended December 31, 1998.

Executive Officers of Armco

     The executive officers of Armco as of March 12, 1999, were as follows:
<TABLE>
<CAPTION>
                                                                      Years
                  Age as of                              Tenure in   of 
Service
Name            March 12, 1999        Office             Office(1)  with Armco
----            ---------------       ------             ----------- ---------
-
<S>                  <C>        <C>                       <C>          <C>
James F. Will        60         Chairman, President and
                                Chief Executive Officer   1994(2)       7

Jerry W. Albright    62         Vice President and
                                Chief Financial Officer   1997          2

James L. Bertsch     55        Vice President and
                               Treasurer                  1989         33

John B. Corey        55        Vice President - Diversified
                               Businesses and Business
                               Development.  President,
                               Douglas Dynamics, L.L.C.   1994         20

John N. Davis        40        Vice President and
                               Controller                 1996          7

Gary R. Hildreth     60        Vice President, General
                               Counsel and Secretary      1993         28

Gary L. McDaniel     52        Vice President - 
                               Operations                 1996          6

M. Dennis McGlone    49        Vice President - 
                               Commercial                 1996          7

Pat J. Meneely       47        Vice President - Information
                               and Organizational 
                               Effectiveness              1995          4

DeWayne W. Tuthill   62        Vice President - Purchasing
                               and Materials Management   1998          1

                                      9
<PAGE>

<FN>

     (1)     All officers are elected annually by the Board of Directors and 
hold office until their successors are elected and qualified.  Each of the 
officers named above has held responsible positions with Armco or its 
subsidiaries during all of the past five years, with the exceptions of 
Messrs. Albright, Meneely and Tuthill.  Prior to joining Armco, Mr. Albright 
was a consultant and small business owner.  Prior to that he was Assistant to 
the President of Armco Inc. and prior to that he was Vice President and Chief 
Financial Officer of Cyclops Industries, Inc.  Immediately prior to joining 
Armco, Mr. Meneely worked as an executive consultant and held executive 
positions with Sara Lee Hosiery and Wheeling-Pittsburgh Steel Corporation.  
Mr. Tuthill previously served as Group Executive Vice President at Wheeling-
Pittsburgh Steel Corporation since October of 1995.  Having been with 
Wheeling-Pittsburgh since 1989, Mr. Tuthill also held the positions of 
Executive Vice President of Operations and Vice President - Purchasing, 
Traffic and Raw Materials.

     (2)     Effective February 1, 1996, Mr. Will was elected Chairman of the 
Board in addition to the positions of President and Chief Executive Officer.

</TABLE>
                                    PART II


ITEM 5.     MARKET FOR REGISTRANT'S COMMON EQUITY
            AND RELATED STOCKHOLDER MATTERS

     Armco's common stock is sold principally on the New York Stock Exchange.  
At February 26, 1999, there were 19,782 common stock shareholders of record.  
Other information required by this item is incorporated herein by reference 
from pages 32 and 36 of the Annual Report to Shareholders for the year ended 
December 31, 1998.

ITEM 6.     SELECTED FINANCIAL DATA

<TABLE>
(In millions, except per share amounts)(1)
<CAPTION>
                                     1998      1997      1996     1995      
1994
                                     ----      ----      ----     ----      --
--
<S>                                   <C>       <C>       <C>       <C>       
<C>
Net sales                             $1,706.5  $1,829.3  $1,724.0  $1,559.9  
$1,437.6
Special charges - net (2)                 --        --        (8.8)     --       
(35.0)
Income from continuing operations        109.6      77.1      26.0      23.5      
65.8
Income per common share 
   from continuing operations:
   - Basic                                0.85      0.55      0.08      0.05      
0.46
   - Diluted                              0.81      0.55      0.08      0.05      
0.46
Total assets                           1,893.8   1,881.3   1,867.8   1,896.6   
1,934.9
Long-term debt and lease obligations     250.7     306.9     344.3     361.6     
363.8
Long-term employee benefit obligations   898.0   1,178.1   1,200.2   1,165.9   
1,221.9


-------------------------------
                                      9
<PAGE>

<FN>


     (1)     The information in this Item should be read in conjunction with 
Armco's financial statements and the notes thereto, which are incorporated by 
reference in Item 8.

     (2)     Special charges primarily relate to the sale and/or 
rationalization of operating facilities.  

</TABLE>

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

     Certain information required by this Item is incorporated herein by 
reference from pages 16-21 under the caption Management's Discussion and 
Analysis in the Annual Report to Shareholders for the year ended December 31, 
1998. 

Other

     Certain statements made or incorporated by reference in this Form 10-K, 
or made in press releases or in oral presentations made by Company employees, 
reflect management's estimates and beliefs and are intended to be, and are 
hereby identified as, "forward-looking statements" for purposes of the safe 
harbor provisions of the Private Securities Litigation Reform Act of 1995.  
These include statements in the paragraphs entitled Outlook for 1999, Armco 
Financial Services Group (AFSG), Liquidity And Capital Resources, 
Environmental Matters, The Year 2000 Issue and New Accounting Standard in the 
section entitled Management's Discussion and Analysis and in the Letter to 
Shareholders contained in the Annual Report to Shareholders and in Note 1. 
Summary of Significant Accounting Policies, relating to Concentration of 
Credit Risk and New Accounting Standard; Note 9. Litigation and Environmental 
Matters; and Note 10. Discontinued Operations, relating to AFSG in the Notes 
to Consolidated Financial Statement in the Annual Report to Shareholders 
incorporated herein by reference.

     Armco cautions readers that such forward-looking statements involve risks 
and uncertainties that could cause actual results to differ materially from 
those currently expected by management.  In addition to those noted in the 
statements themselves, these factors include, but are not limited to, the 
following: risks of a downturn in the general economy or in the highly 
cyclical steel industry; volatility in financial markets, which may affect 
invested pension plan assets and the calculation of benefit plan liabilities 
and expenses; changes in demand for Armco's products; unplanned plant outages, 
equipment failures or labor difficulties; actions by Armco's foreign and 
domestic competitors;; unexpected outcomes of major litigation and 
contingencies; changes in U.S. trade policy and actions respecting imports; 
disruptions in the supply of raw materials; actions by reinsurance companies 
with which AFSG does business, or foreign or domestic insurance regulators; 
and changes in application or scope of environmental regulations applicable to 
Armco.

ITEM 8.     FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     The information required by this Item is incorporated herein by reference 
from pages 22-35 of the Annual Report to Shareholders for the year ended 
December 31, 1998. 

ITEM 9.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND 
            FINANCIAL DISCLOSURE

     None.
                                      10
<PAGE>



                                    PART III


ITEM 10.     DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The information required by this item as to executive officers of Armco 
is contained in Part I of this report under "Executive Officers of Armco" and 
is incorporated herein by reference.  The information required as to directors 
is incorporated herein by reference from the information set forth under the 
caption "ELECTION OF DIRECTORS" in the registrant's Proxy Statement for the 
1999 Annual Meeting of Shareholders filed with the Securities and Exchange 
Commission pursuant to Rule 14a-6 of the Securities Exchange Act of 1934, as 
amended (the "Proxy Statement").

ITEM 11.     EXECUTIVE COMPENSATION

     The information required by this item is incorporated herein by reference 
from the information set forth in the Proxy Statement under the caption 
"EXECUTIVE COMPENSATION".


ITEM 12.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The security ownership in Armco stock of directors, certain executive 
officers and directors and executive officers as a group and of persons known 
by Armco to be the beneficial owners of more than five percent of any class of 
Armco's voting securities is incorporated herein by reference from the 
information set forth in the Proxy Statement under the caption "MISCELLANEOUS 
-- Stock Ownership".

ITEM 13.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     None.

                                    PART IV

ITEM 14.     EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

I.     Documents Filed as a Part of this Report


A.     Financial Statements and Financial Statement Schedules           Page
                                                                        ----

1.     Consolidated Statements of Income and Comprehensive Income
       for the Years Ended December 31, 1998, 1997 and 1996               *

2.     Consolidated Balance Sheets as of December 31, 1998 and 1997       *

3.     Consolidated Statements of  Cash Flows for the Years Ended
       December 31, 1998, 1997 and 1996                                   *

4.     Notes to Consolidated Financial Statements                         *

                                      11
<PAGE>


5.     Independent Auditors' Report                                       *

6.     Responsibility for Financial Reporting                             *

----------------
*  Incorporated in this Annual Report on Form 10-K by reference to pages 22-35 
of the Annual Report to Shareholders for the year ended December 31, 1998.

        Financial Statements and Financial Statement Schedules Omitted

     The financial statements and financial statement schedules for Armco Inc. 
and subsidiaries, other than those listed above, are omitted because of the 
absence of conditions under which they are required, or because the 
information is set forth in the Notes to Consolidated Financial Statements.

     B.     Exhibits

     The following is an index of the exhibits included in the Annual Report 
on Form 10-K.

3(a).   Articles of Incorporation of Armco Inc., as amended as of April 4, 
1996 (1)

3(b).   Regulations of Armco Inc. (2)

4.      Armco hereby agrees to furnish to the Securities and Exchange 
Commission, upon its request, a copy of each instrument defining the rights of 
holders of long-term debt of Armco and its subsidiaries, omitted pursuant to 
Item 601(b)(4)(iii) of Regulation S-K.

10(a).   Deferred Compensation Plan for Directors*

10(b).   1993 Long-Term Incentive Plan of Armco Inc. (3)*

10(c).   Amended Severance Benefit Agreement (4)*

10(d).   1988 Restricted Stock Plan (5)*

10(e).   Executive Supplemental Deferred Compensation Plan Trust (6)*

10(f).   Executive Supplemental Deferred Compensation Plan (7)*

10(g).   Pension Plan for Outside Directors (8)*

10(h).   Key Management Severance Policy (9)*

10(i).   Minimum Pension Plan (10)*

10(j).   Stainless Steel Toll Rolling Services Agreement (11)

10(k).   Rights Agreement dated as of February 23, 1996 between Armco Inc. and 
Fifth Third Bank (12)

                                      12
<PAGE>


13.      Annual Report to Shareholders for the year ended December 31, 1997.  
(Filed for information only, except for those portions that are specifically 
incorporated in this Form 10-K Annual Report for the year ended December 31, 
1997.)

21.     List of subsidiaries of Armco Inc.

23.     Independent Auditors' Consent

27.     Financial Data Schedule

99.     Description of Armco Capital Stock

        The annual reports (Form 11-K) for the year ended December 31, 1998 
for the Armco Inc. Retirement and Savings Plan and the Armco Inc. Thrift Plan 
for Hourly Employees will be filed by amendment as exhibits hereto, as 
permitted under Rule 15d-21.

*  Management contract or compensatory plan or arrangement required to be 
filed as an exhibit to the Annual Report on Form 10-K pursuant to Item 14(c) 
of Form 10-K.


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

(1)     Incorporated by reference from Exhibit 3.1 to Armco's Quarterly Report 
on Form 10-Q for the quarter ended March 31, 1993.

(2)     Incorporated by reference from Exhibit 3.2 to Armco's Quarterly Report 
on Form 10-Q for the quarter ended March 31, 1994.

(3)     Incorporated by reference from Exhibit 10 to Armco's Quarterly Report 
on Form 10-Q for the quarter ended March 31, 1993.

(4)     Incorporated by reference from Exhibit 10(i) to Armco's Annual Report 
on Form 10-K for the year ended December 31, 1997.

(5)     Incorporated by reference from Exhibit 10(i) to Armco's Annual Report 
on Form 10-K for the year ended December 31, 1988 (SEC File No. 001-00873).

(6)     Incorporated by reference from Exhibit 10(b) to Armco's Quarterly 
Report on Form 10-Q for the quarter ended June 30, 1988 (SEC File No. 001-
00873).

(7)     Incorporated by reference from Exhibit 10(c) to Armco's Quarterly 
Report on Form 10-Q for the quarter ended June 30, 1988 (SEC File No. 001-
00873).

(8)     Incorporated by reference from Exhibit 10(p) to Armco's Annual Report 
on Form 10-K for the year ended December 31, 1989 (SEC File No. 001-00873).

(9)     Incorporated by reference from Exhibit 10(p) to Armco's Annual Report 
on Form 10-K for the year ended December 31, 1990.

                                      13
<PAGE>

(10)     Incorporated by reference from Exhibit 10(r) to Armco's Annual Report 
on Form 10-K for the year ended December 31, 1991.

(11)     Incorporated by reference from Exhibit 10(s) to Armco's Annual Report 
on Form 10-K for the year ended December 31, 1993.

(12)     Incorporated by reference from Exhibit 10(p) to Armco's Form 10-K for 
the year ended December 31, 1995.

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

II.     Reports on Form 8-K

     The following Report on Form 8-K as filed by Armco during the quarter 
ended December 31, 1998.



Report Date            Description
-----------            -----------

December 7, 1998       On December 7, 1998, Armco Inc. (the "Company")
                       announced plans to issue $75 million of Senior Notes
                       maturing in 2008, in a private placement pursuant to
                       Rule 144A under the Securities Act of 1933, as amended.
                       The Company stated that it intends to use the net
                       proceeds of the offering to redeem or repurchase
                       certain outstanding debt securities.

                                      14
<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) 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 as of March 12, 
1999.

                                          ARMCO INC.


                                          By        JAMES F. WILL
                                          ----------------------------------
                                                    James F. Will
                                         Chairman of the Board, President and
                                               Chief Executive Officer

     Pursuant to the requirements of the Securities Exchange Act of 1934, this 
report has been signed below by the following persons on behalf of the 
registrant and in the capacities indicated as of March 12, 1999.


By     JAMES F. WILL                          By     JOHN C. HALEY
--------------------------------------       -------------------------------
       James F. Will                                 John C. Haley
Chairman of the Board, President,                      Director
      Chief Executive Officer
        and Director


By        JERRY W. ALBRIGHT                   By     CHARLES J. HORA, JR.
--------------------------------------       ------------------------------
          Jerry W. Albright                          Charles J. Hora, Jr.
         Vice President and                            Director
       Chief Financial Officer


By        JOHN N. DAVIS                       By    BRUCE E. ROBBINS
-------------------------------------       ------------------------------
          John N. Davis                             Bruce E. Robbins
    Vice President and Controller                     Director


By    DAN R. CARMICHAEL                     By    JAN H. SUWINSKI
-------------------------------------       ------------------------------
      Dan R. Carmichael                           Jan H. Suwinski
         Director                                    Director


By    PAULA H.J. CHOLMONDELEY                 By    JOHN D. TURNER
--------------------------------------      ------------------------------
      Paula H.J. Cholmondeley                       John D. Turner
         Director                                      Director

By     DOROTHEA C. GILLIAM
--------------------------------------
       Dorothea C. Gilliam
           Director


                                       15
<PAGE>

                            EXHIBIT INDEX

     The following is an index of the exhibits included in the Annual Report 
on Form 10-K.


13.    Annual Report to Shareholders for the year ended December 31, 1998.  
(Filed for information only, except for those portions that are specifically 
incorporated in this Form 10-K Annual Report for the year ended December 31, 
1998.)

21.    List of subsidiaries of Armco Inc.

23.    Independent Auditors' Consents

27.    Financial Data Schedule

99.    Description of Armco Capital Stock

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