UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                   FORM 10-K/A
                                 Amendment No. 1

|X|  ANNUAL  REPORT  PURSUANT  TO  SECTION  13 OR 15(d)  OF THE  SECURITIES
     EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1997

|_|  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
     EXCHANGE ACT OF 1934
     For the transition period from              to
                                         
                         Commission File Number: 0-23110

                            DIGITAL LINK CORPORATION
             (Exact name of registrant as specified in its charter)

            California                                        77-0067742
 (State or other jurisdiction of                            (IRS Employer
  incorporation or organization)                        Identification Number)

           217 Humboldt Court                                  94089
             Sunnyvale, CA                                   (Zip Code)
(Address of principal executive offices)

Registrant's telephone number, including area code:  (408) 745-6200

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

Securities registered pursuant to Section 12(g) of the Act:  Common Stock, 
                                                             no par value
                                                               (Title of class)

Indicate  by check  mark  whether  the  registrant:  (1) has filed  all  reports
required to be filed by Sections 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 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 the voting stock held by  non-affiliates  of the
registrant as of March 25, 1998, was approximately $13,823,068.00.

The number of shares  outstanding of the  registrant's  Common Stock as of March
25, 1998, was 9,314,006 shares.

                      DOCUMENTS INCORPORATED BY REFERENCE:
Portions of the definitive proxy statement (the "Definitive Proxy Statement") to
be filed with the Securities and Exchange  Commission  relative to the Company's
annual  meeting of  shareholders  to be held May 20,  1998 are  incorporated  by
reference in Part III hereof.

================================================================================


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                                     PART IV

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

     The following financial  statements and schedules are filed as part of this
report:

                                                                       Page
(a)1.          Financial Statements

               See index in Part II, Item 8......................       24

(a)2. and (d)  Financial Statement Schedules

               Report of Independent Accountants.................       46
               Schedule II - Valuation and Qualifying Accounts...       47

     All schedules not listed above are omitted  because they are not applicable
or the required  information  is included in the  financial  statements or notes
thereto.

(a)3. and (c)       Exhibits

3.01    Registrant's Amended and Restated Articles of Incorporation filed on 
        February 7, 1994. (1)
3.02    Registrant's Certificate of Correction of Amended and Restated Articles
        of Incorporation filed on April 7, 1994. (1)

3.03    Registrant's Bylaws, as amended. (2)
4.01    Form of Specimen Certificate for Registrant's Common Stock. (3)
4.02    Registration Rights Agreement among Registrant, Vinita Gupta, Summit 
        Ventures L.P., SV Eurofund C.V. and Summit Investors, L.P. dated 
        December 23, 1987 and certain exhibits thereto. (3)
+10.01  Registrant's 1986 Stock Option Plan, as amended. (3)
+10.02  Form of Agreement for Registrant's 1986 Stock Option Plan. (1)
+10.03  Registrant's 1986 Stock Purchase Plan. (3)
+10.04  Form of Agreement for Registrant's 1986 Stock Purchase Plan, as 
        amended. (1)
+10.05  Registrant's 1992 Equity Incentive Plan, as amended. (8)
+10.06  Form of Agreement for Registrant's 1992 Equity Incentive Plan, as 
        amended. (1)
+10.07  Registrant's 1993 Employee Stock Purchase Plan. (3)
+10.08  Registrant's 1994 Directors Stock Option Plan. (1)
+10.09  Form of Agreement for Registrant's 1994 Directors Stock Option Plan. (1)
10.10   Form of Indemnity Agreement entered into with each of Registrant's 
        directors. (3)
10.11   Lease Agreement between Registrant and John Hancock Mutual Life 
        Insurance Company dated June 17, 1992. (3)
10.12   Form of Patent License Agreement between Registrant and QPSX 
        Communications Ltd. dated December 1993. (3)
10.13*  Software License Agreement between Registrant and Epilogue Technology 
        Corporation dated January 20, 1992. (3)
10.14   Stockholder Agreement among Registrant, Vinita Gupta, Narendra Gupta, 
        Summit Ventures, L.P., SV Eurofund C.V. and Summit Investors, L.P. 
        dated December 23, 1987. (3)
10.16   Original Equipment Manufacturer Agreement between Registrant and 
        Siemens Aktiengesellschaft dated April 7, 1995.(4)

+10.18  Employment Agreement between Registrant and Alan Fraser dated 
        September 5, 1996.(6)
+10.19  Security Agreement between Registrant and Alan Fraser dated 
        September 30, 1996.(6)
+10.20  Secured Promissory Note from Alan Fraser dated September 30, 1996. (6)
+10.21  Separation Agreement between Registrant and James Checco dated 
        November 19, 1996. (7)

21.01   List of Subsidiaries. (3)
23.01   Consent of Independent Accountants (9)
27.01   Financial Data Schedule (9)
27.02   Restated Financial Data Schedule for the year ended December 31, 1996
27.03   Restated Financial Data Schedule for the six month period ended 
        June 30, 1997
27.04   Restated Financial Data Schedule for the nine month period ended 
        September 30, 1997
-----
    *   Confidential treatment has been obtained with respect to portions of 
        this exhibit.
   (1)  Filed as an exhibit to Registrant's Form 10-K for the year ended 
        December 31, 1994 and incorporated herein by reference.
   (2)  Filed as an exhibit to Registrant's Registration Statement on Form S-8
        (No. 33-95176) filed on July 31, 1995 and incorporated herein by  
        reference.
   (3)  Filed as an exhibit to Registrant's Form S-1 Registration Statement 
        (File No. 33-72642), which was declared effective January 31, 1994, and
        incorporated herein by reference.
   (4)  Filed as an exhibit to Registrant's Form 10-Q for the quarter ended 
        June 30, 1995 and incorporated herein by reference.
   (5)  Filed as an exhibit to Registrant's Form 10-K for the year ended 
        December 31, 1995 and incorporated herein by reference.
   (6)  Filed as an exhibit to Registrant's Form 10-Q for the quarter ended 
        September 30, 1996 and incorporated herein by reference.
   (7)  Filed as an exhibit to Registrant's Form 10-K for the year ended 
        December 31, 1996 and incorporated herein by reference.
   (8)  Filed as an exhibit to Registrant's Registration Statement on Form S-8 
        (No. 333-27855) filed on May 27, 1997 and incorporated herein by  
        reference.
   (9)  Filed as an exhibit to Registrant's Form 10-K for the year ended 
        December 31, 1997 previously filed on March 26, 1998 and incorporated
        herein by reference.
    +   Management contract or compensatory plan required to be filed as an 
        exhibit to this Form 10-K.

(b)   Reports on Form 8-K

      No reports on Form 8-K were filed during the last quarter of
      the period covered by this report.


<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.

                                           DIGITAL LINK CORPORATION

April 20, 1998                             By:  /s/ Stanley E. Kazmierczak
                                              ------------------------------
                                                    Stanley E. Kazmierczak
                                                    Chief Financial Officer

     Pursuant to the  requirements of the Securities  Exchange Act of 1934, this
Report has been signed below by the following person on behalf of the Registrant
and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>

       Signature                                Title                          Date
       ---------                                -----                          ----

<S>                                    <C>                                 <C> 
     *                                 Chairperson of the Board, Chief     April 20, 1998
 -----------------------------         Executive Officer and President
   Vinita Gupta                         (Principal Executive Officer)

                                          Chief Financial Officer
                                        and Vice President, Finance
                                            and Administration
                                         (Principal Financial and
/s/ Stanley E. Kazmierczak                  Accounting Officer)           April 20, 1998
------------------------------
   Stanley E. Kazmierczak

     *                                           Director                 April 20, 1998
------------------------------
   Richard C. Alberding

     *                                           Director                 April 20, 1998
------------------------------
   Gregory M. Avis

     *                                           Director                 April 20, 1998
------------------------------
   Lance Boxer

     *                                           Director                 April 20, 1998
------------------------------
   Alan I. Fraser

     *                                           Director                 April 20, 1998
------------------------------
   Narendra K. Gupta

</TABLE>



*By:          /s/ Stanley E. Kazmierczak
        ----------------------------------------
         Stanley E. Kazmierczak, Attorney-in-Fact


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