SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

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

                  For the Quarterly Period ended March 31, 1998

                                       OR

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


               Commission File Number: 33-18099-NY and 33-23169-NY

                           QUEST PRODUCTS CORPORATION
        (Exact Name of small business issuer as specified in its charter)

         DELAWARE                                            11-2873662
State or other jurisdiction of                         (IRS Employer I.D. No.)
Incorporation or organization)

                 6900 Jericho Turnpike, Syosset, New York 11791
                    (Address of principal executive offices)

Issuer's telephone number, including area code:    (516) 364 - 3500

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

Indicate by check mark whether the registrant (1) 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 the number of shares  outstanding  of each of the  issuer's  classes of
Common Stock, as of the last practicable date.

         Class                                    Outstanding at March 31, 1998
---------------------------                       -----------------------------
Common Stock, par value                                      152,703,713
$.00003 per share


<PAGE>



PART 1 FINANCIAL INFORMATION
Item 1, financial statements


QUEST PRODUCTS CORPORATION 
FINANCIAL STATEMENTS (Unaudited)
March 31, 1998



Financial Statements                                                       Page


Balance Sheet                                                             3 - 4


Statements Operations                                                         5


Statements of Shareholders' (Deficit)                                         6


Statements of Cash Flows                                                  7 - 8


Notes to Financial Statements                                            9 - 10


Management's Discussion and Analysis                                    11 - 13


Other Information                                                            14


Signatures                                                                   15

                                        2

<PAGE>




QUEST PRODUCTS CORPORATION
Balance Sheet
March 31, 1998
(Unaudited)




Assets
     Current Assets
       Cash                                                             $ 67,241

       Accounts receivable-net of allowance for doubtful
       accounts of $1,000                                                 58,351


       Inventory                                                          90,290


       Prepaid expenses                                                    1,496
                                                                        --------

                                                                         217,378

     Furniture and Equipment - at cost - net of accumulated
       depreciation of $20,019                                            28,396

     Patents - at cost - net of accumulated amortization of
       $10,547                                                            38,888


     Security  Deposits                                                    4,137
                                                                        --------

                                                                        $288,799
                                                                        ========







See notes to financial statements.

                                        3

<PAGE>



QUEST PRODUCTS CORPORATION
Balance Sheet
March 31, 1998
(Unaudited)




Liabilities and Shareholders' (Deficit)
     Current Liabilities
       1992 convertible debentures - including accrued interest
         of $6,150                                                  $    16,150

       Shareholder's loan                                               180,114

       Accounts payable                                                 558,752

       Accrued officer and director's compensation                      224,493

       Loans from directors                                              34,415

       Accrued expenses                                                  27,027
                                                                    -----------

                                                                      1,040,951
                                                                    -----------


     Shareholders' (Deficit)
       Series A Convertible Preferred Stock - par value $.001-
         authorized 600,000 shares - no shares issued and
         outstanding
       Series B Convertible Preferred Stock - par value $.001-
         authorized 5,000,000 shares - no shares issued and
         outstanding
       Common Stock - par value $.00003 - authorized
         200,000,000  shares - 152,703,713 shares issued and
         outstanding                                                      4,581
       Capital in excess of par                                       3,506,171
       Accumulated (deficit)                                         (4,262,904)
                                                                    -----------

                                                                       (752,152)
                                                                    -----------

                                                                    $   288,799
                                                                    ===========







See notes to financial statements.
                                        4

<PAGE>



QUEST PRODUCTS CORPORATION
Statements of Operations
(Unaudited)


                                              For the Three Months Ended
                                                       March 31,
                                            ------------------------------
                                                1998             1997
                                            -------------    -------------

Sales - net                                 $     282,072    $     102,960

Cost of Sales                                      49,325           41,147
                                            -------------    -------------

                                                  232,747           61,813
                                            -------------    -------------

Selling Expenses                                  171,071           21,615

General and Administrative Expenses               148,310          140,763
                                            -------------    -------------

                                                  319,381          162,378
                                            -------------    -------------

(Loss) Before Other Income (Expenses)             (86,634)        (100,565)
                                            -------------    -------------


Other Income (Expenses)
       Interest income                                  7            2,233
       Interest (expense)                          (4,162)         (14,620)
                                            -------------    -------------

                                                   (4,155)         (12,387)
                                            -------------    -------------

Net (Loss)                                  $     (90,789)   $    (112,952)
                                            =============    =============


(Loss) Per Share                            $         NIL    $         NIL
                                            =============    =============


Weighted Average Number of Shares
       Outstanding (to nearest 1,000,000)     123,000,000       90,000,000
                                            =============    =============







See notes to financial statements.
                                        5

<PAGE>



QUEST PRODUCTS CORPORATION
Statement of Shareholders' (Deficit)
For the Three Months Ended March 31, 1998

(Unaudited)

<TABLE>
<CAPTION>
                                Number of
                              Common Stock    Amount      Capital in
                                 Shares       $.00003      Excess of    Accumulated
                              (Post-split)   Par Value     Par Value      Deficit
                              -----------   -----------   -----------   -----------
<S>                           <C>           <C>           <C>           <C>         
Balance - December 31, 1997   138,083,713   $     4,142   $ 3,360,410   $(4,172,115)


Proceeds from sale of stock    14,620,000           439       145,761          --

Net (Loss)                           --            --            --         (90,789)
                              -----------   -----------   -----------   -----------

Balance- March 31, 1998       152,703,713   $     4,581   $ 3,506,171   ($4,262,904)
                              ===========   ===========   ===========   ===========
</TABLE>













See notes to financial statements.
                                        6

<PAGE>



QUEST PRODUCTS CORPORATION
Statements of Cash Flows                                             Page 1 of 2
(Unaudited)


                                                      For the Three Months Ended
                                                              March 31,
                                                      --------------------------
                                                          1998         1997
                                                        ---------    ---------


Cash Flows from Operating Activities
   Net (loss)                                            $ (90,789)   $(112,952)
   Adjustments to reconcile net (loss) to net cash
     (used for) operating activities:
       Depreciation and amortization                         1,449        1,405
       Expenses paid through the issuance of
               restricted common stock                        --          8,750
       Accrued interest                                      4,162        5,375
       (Increase) decrease in:
         Accounts receivable                               (55,638)       2,520
         Inventories                                       (21,829)      34,730
         Advances to Automotive Marketing,Inc                 --         (3,280)
          Deferred preoperating and developmental costs       --         (7,779)
       Increase (decrease) in:
         Notes payable-vendor                                 --        (20,940)
         Accounts payable                                  (25,226)      (9,870)
         Accrued officers' and directors' compensation      81,000       42,500
         Taxes payable                                        --         (1,898)
         Loans from directors                               (1,400)         623
         Accrued expenses                                    1,724      (18,045)
                                                         ---------    ---------

                                                          (106,547)     (78,861)

Cash Flows from Investing Activities
   Patent payments                                            --         (1,435)
                                                         ---------    ---------

                                                              --         (1,435)
                                                         ---------    ---------


Cash Flows from Financing Activities

   Proceeds from sales of common stock                     146,200         --
   Repayments to shareholder                                  --         (7,500)
                                                         ---------    ---------

                                                           146,200       (7,500)
                                                         ---------    ---------

Net Increase in Cash                                        39,653      (87,796)

Cash - beginning                                            27,588      260,372
                                                         ---------    ---------

Cash - end                                               $  67,241    $ 172,576
                                                         =========    =========




See notes to financial statements.
                                        7

<PAGE>


QUEST PRODUCTS CORPORATION
Statements of Cash Flows                                             Page 2 of 2
(Unaudited)

                                                      For the Three Months Ended
                                                               March 31
                                                      --------------------------
                                                          1998          1997
                                                      ------------   -----------

Supplemental Disclosures

       Interest paid                                   $      --     $      --
                                                       ===========   ===========


       Temporary media funds received                  $      --     $      --
                                                       ===========   ===========





See notes to financial statements.
                                        8

<PAGE>



QUEST PRODUCTS CORPORATION
NOTES TO FINANCIAL STATEMENTS (Unaudited)
March 31, 1998



1.   BACKGROUND AND BASIS OF PRESENTATION

     Quest  Products  Corporation  (the  "Company")  was organized as a Delaware
     Corporation  on July 17, 1987 and operated as a  development  stage company
     through  1993.  The  Company's  purpose  is to market  and  distribute  its
     patented phase-out system smoking cessation device (the "product").

     The Company had primarily marketed the product in the United States through
     direct  response   marketing   including   radio,   television   spots  and
     infomercials.  This  domestic  marketing  was  curtailed due to the ongoing
     negotiations  with the Federal Trade  Commission  ("FTC"),  which have been
     concluded. In March 1998, the Company reentered the domestic retail market.
     The Company also distributes the product overseas.

     The financial  statements have been prepared assuming that the Company will
     continue as a going concern. The Company has suffered recurring losses from
     operations  ($90,789  in 1998 and  $112,952  in 1997),  and has had limited
     liquidity  causing  difficulty  in meeting  its current  operating  expense
     obligations  and  debt  service  requirements.   The  Company  is  actively
     marketing  the product to help  improve  revenues  and may seek  additional
     financing through private  placement of debt and securities.  The financial
     statements  do not include any  adjustments  that might  result  should the
     continued existence of the Company be threatened by any continued losses or
     the failure of the above factors to influence  the  financial  viability of
     the Company.

     The interim  statements  were  prepared  pursuant to the  requirements  for
     reporting  on Form 10- QSB.  The  interim  financial  statements  and notes
     thereto  should be read in  conjunction  with the financial  statements and
     notes included in the Company's latest Annual Report on Form 10-KSB for the
     year ended  December 31, 1997.  In the opinion of  management,  the interim
     financial  statements  reflect all adjustments of a normal recurring nature
     necessary  for a fair  statement  of the results for interim  periods.  The
     current period results of operations are not necessarily  indicative of the
     results for the entire year ending December 31, 1998.

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Changes  in  significant  accounting  policies  - There  were no changes in
     significant accounting policies during the current period.

3.   RELATED PARTY TRANSACTIONS

     Loans from  Director  and  Officer - A former  officer/shareholder,  who is
     still a director of the Company, is owed $34,415 by the Company. The amount
     is payable on demand with a stated interest rate of 11%. Effective June 30,
     1997, the former officer/shareholder agreed to no longer charge interest.

                                        9

<PAGE>



QUEST PRODUCTS CORPORATION
NOTES TO FINANCIAL STATEMENTS (Unaudited)
March 31, 1998



     Officer's and  Director's  Compensation  - During 1996,  an investor  group
     brought in by two individuals which acquired an 18% ownership  interest for
     $500,000 was awarded two seats on the Board of Directors  and one officer's
     position.  The two  individuals  had  consulting  agreements  for which the
     Company accrued fees of $5,000 per month for each individual from July 1996
     through   November  1997.  In  December  1997,  the  Company  entered  into
     employment  contracts with each of these two  individuals  for $150,000 per
     year for five years from  December  1997 through  November  2002 and issued
     options to purchase  7,500,000 shares each at an exercise price of $.03 per
     share. As of March 31, 1998, the two individuals  were owed $85,000 each in
     accrued consulting fees and salaries.

     A director,  who was  previously  the Company's  chief  executive  officer,
     entered into a consulting  agreement  with the Company for $2,000 per month
     from October 1997 through  September 1998. As of March 31, 1998, he is owed
     $54,493 in accrued salary, consulting fees and expenses.


4.   SHAREHOLDER'S LOAN

     During 1996, the Company received  $200,000 from a shareholder as a loan in
     connection with the Company's  media  campaign.  Repayments of $35,000 were
     made in cash  and  $7,500  in  stock.  The  repayment  of the  $157,500  of
     remaining principal at March 31, 1998 and $22,614 of interest which accrues
     at 10% will be negotiated.

5.   COMMITMENTS, CONTINGENCIES AND OTHER COMMENTS.

     Dependence  on Major  Customers  and  Suppliers  -  Domestic  retail  sales
     represent  approximately  90%  of  sales  with  only  one  retail  customer
     representing more than 10% of total sales.

     The Company is currently purchasing 100% of its products from two vendors.

     Regulatory Matters - There have been no changes in the status of regulatory
     inquiries by the Food and Drug  Administration  (FDA) and the Federal Trade
     Commission (FTC).

     Litigation - In July 1997, the Company's former attorney, who is a relative
     of a  Director,  brought an action  against  the  Company in New York State
     Supreme Court,  New York County for unpaid attorney fees and  disbursements
     of approximately  $18,000.  Legal counsel has not rendered an opinion as to
     the ultimate outcome of this matter.

                                       10

<PAGE>



QUEST PRODUCTS CORPORATION
Management's Discussion and Analysis




                              Results of Operations
                   Three Months Ended March 31, 1998 Compared
                      to Three Months Ended March 31, 1997



     The Company incurred a net loss of $90,789 for the three months ended March
31, 1998 as compared to the loss of $112,952  for the three  months  ended March
31, 1997.  Three-month sales increased $179,112.  The increase in sales resulted
from a retail sales program which began in March 1998.

     Selling  expenses  increased  from  $21,615 to  $171,071 as a result of the
additional  costs  associated  with the  distribution of the product into retail
chain drug stores.

     General and administrative  expenses increased from $140,763 to $148,310 as
a result of an increase in officer salaries  ($56,322) less a decrease in office
salaries and consulting fees ($45,247).

     The gross profit margin  increased  from 60% to 82%, due to the high volume
of domestic retail sales.

     The Company maintains a $1,000,000 liability insurance policy.

                                       11

<PAGE>



QUEST PRODUCTS CORPORATION
Management's Discussion and Analysis



                         Liquidity and Capital Resources

Cash of $106,547 was used for  operations  for the 3 months ended March 31, 1998
as compared  to $78,861  used in the same  period of last year.  Cash  increased
during the 3 months ended March 31, 1998 by $39,653.

The Company's  working capital has deteriorated due to the use of current assets
for operations. Working capital and current ratios were:

<TABLE>
<CAPTION>
                                    March 31,                 December 31,             March 31,
                                      1998                       1997                     1997
                                      ----                       ----                     ----
<S>                                 <C>                       <C>                       <C>     
Working capital
(deficiency)                        $823,573                  $880,433                  $555,976
Current ratios                        0.21:1                    0.10:1                    0.35:1
</TABLE>

In order to meet short-term  marketing  goals, in July 1997 certain officers and
directors  agreed to acquire an aggregate of 10,000,000  shares of the Company's
common  stock  (representing  8% of total shares  outstanding)  for an aggregate
purchase price of $100,000.  The Company is also seeking an additional  $240,000
of financing  under the same terms and conditions as offered to the officers and
directors. As of March 31, 1998, the Company has received $318,700.  There is no
assurance that the Company will be able to obtain additional financing.


                           Distribution and Marketing

Marketing (Domestic)

     In March 31, 1998,  the Company  entered the U.S.  retail  market under the
category of smoke cessation products.

Marketing (International)

     On August 21, 1995,  the Company  entered  into an  agreement  with a South
Korean  trading  company  for the  distribution  and  manufacture  of a modified
(design)  PhaseOut  product in South Korea.  Because of the improved  design and
reduced size of this PhaseOut device, it will be utilized in the Japanese market
as well.  South Korea has 10 million  smokers and Japan has 35 million  smokers.
Distribution in South Korea is expected to begin in the 3rd quarter of 1998.

                                       12

<PAGE>



QUEST PRODUCTS CORPORATION
Management's Discussion and Analysis


New Products

     In May 1997,  the Company  entered  into a joint  venture  with  Automotive
Marketing,  Inc. to manufacture and distribute  aftermarket automobile products.
As of March 31,  1998,  the Company has incurred  expenses of $130,716  with the
understanding  that any such expenses will be reimbursed when  revenue-producing
operations commence.


                               Regulatory Matters

     There have been no material changes in the status of matters pending before
the Food and Drug Administration (FDA) and the Federal Trade Commission (FTC).




                                       13

<PAGE>



                           PART II - OTHER INFORMATION



Item 1.   Legal Proceedings

          The Company has been sued by a former attorney for fees it alleges are
          due but unpaid in the amount of approximately  $18,000.  Legal counsel
          has not rendered an opinion as to the ultimate outcome of this matter.

Item 2.   Changes in Securities

                           None

Item 3.   Defaults Upon Senior Securities

                           None

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

                           None

Item 5.   Other Information

                           See notes to the financial statements

Item 6.   Exhibits and Reports

                           None


                                       14

<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.


                                                 QUEST PRODUCTS CORPORATION


Dated:  May 13, 1998

                                                 /S/:
                                                 ------------------------------
                                                 Herbert M. Reichlin, President


                                       15