UNITED STATES
                   SECURITIES AND EXCHANGE COMMISSION
                         Washington, DC  20549

                               FORM 10-K

  [X] Annual Report Pursuant to Section 13 or 15(d) of the Securities 
      Exchange Act of 1934 for the fiscal year ended December 31, 1998

  [ ] Transition Report Pursuant to Section 13 or 15(d) of the 
      Securities Exchange Act of 1934 for the transition period from 
      ____________ to ____________

                       Commission File No. 1-8250

                 WELLS-GARDNER ELECTRONICS  CORPORATION
         (Exact name of registrant as specified in its charter)

           ILLINOIS                           36-1944630
(State or other jurisdiction of   (IRS Employer Identification Number)
 incorporation or organization) 

 2701 North Kildare Avenue, Chicago, Illinois              60639
 (Address of principal executive offices)                (Zip Code)

 Registrant's telephone number, including area code:  773/252-8220

 Securities registered pursuant to Section 12(b) of the Act:

 Common Stock, $1.00 par value              American Stock Exchange
     Title of each class                    Name of each exchange on 
                                            which registered

 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 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.  [ ]

  As of March 12, 1999,  4,293,547   shares of the Common Stock of the
registrant were outstanding.

  While it  is difficult  to determine  the number  of shares of stock
owned by non affiliates, the  registrant estimates that the  aggregate
market value of the registrant's  Common Stock  held by non affiliates  
on March 12, 1999 was approximately $8,949,000. This  determination is
based upon an estimate that 72.5% of the shares  are so  owned by  non
affiliates and upon the closing  price for  the  Common Stock  on  the
American Stock Exchange on such date.
<PAGE>
                  DOCUMENTS INCORPORATED BY REFERENCE
                                                              Part
Portions of Annual Report to Shareholders for fiscal year 
ended December 31, 1998:                                     I & II
Portions of Proxy Statement for Annual Meeting of 
Shareholders to be held on April 27, 1999:                   III

                                PART I
Item 1.  BUSINESS

  (a)  General Development of Business

  Wells-Gardner Electronics  Corporation (the  "Company")  is an  ISO
9001 certified  video products  company which  designs,  manufactures,
assembles and markets color video  monitors, video liquid crystal  and
plasma displays, coin doors and coin mechanisms for a wide variety  of
markets including,  but not  limited  to, coin-operated  video  games,
lottery and gaming machines, leisure and fitness, automotive, display,
intranet, service and video walls.  The Company continues to focus  on
improving the quality of its products to achieve its goal of being the
"best-in-class" quality supplier  in all its  served markets.   During
1998, the Company passed its annual quality audit conducted by the ISO
9001 accreditation  agency giving  the Company  certification  through
January 12, 2001.  The Company was incorporated in Illinois in 1925.

  (b)  Narrative Description of Business

  (c)  (i), (ii) and (iii)

  PRODUCTS

   The Company's primary business is the design, manufacture, assembly
and marketing of  electronic components which  consist of video  color
monitors and displays, coin  doors and mechanisms  and the bonding  of
touch sensors  to  video monitors.  The  image  on a  CRT  display  is
produced by magnetically guiding an interruptible stream of  electrons
against the back of a phosphorescent screen.  This stream of electrons
scans a series of horizontal lines from  the top to the bottom of  the
screen.  When the stream of electrons strikes the back of the screen a
bright area  is produced  and  when it  is  interrupted, a  dark  area
appears.  In a medium-resolution unit,  the stream of electrons  scans
the screen in a  series of 525 horizontal  lines 30 times per  second,
whereas the  series of  light and  dark areas  produced appears  as  a
steady coherent image to the viewer.  High-resolution displays scan  a
greater number of lines at a  greater speed, thus producing a  clearer
image on the screen.  CRT  video products accounted for  approximately
99 percent of revenues in 1998, 1997 and 1996.
<PAGE>
  The Company offers a  full line of  video monitors, with  CRT sizes
ranging from 13" to 39" with horizontal scan frequencies from 15kHz to
35kHz.  In  addition to providing  standardized products, the  Company
also  customizes  electrical  and  mechanical  applications  to   meet
specific customer requirements.  The Company's line  of color display
monitors  have  been  redesigned  over  the  past  years  for   higher
performance and lower per unit cost.  In 1998, the Company released 10
new voltage free products  which allow the products  to be plugged  in
anywhere in the world.  As a compliment to its core product line,  the
Company also offers a wide variety  of mechanical coin doors and  coin
mechanisms.  The Company also optically bonds touch screen sensors  to
the face of the monitors to allow the  user of a CRT video monitor  to
interact with a computer program by touching a video screen.


  The Company's sales are comprised of  five main applications:

                             1998    1997    1996
          Amusement           38%     44%     49%
          Gaming              22%     20%     17%
          Service & Coin      20%     15%     11%
          Leisure / Fitness    9%     12%     13%
          Display / Other     11%      9%     10%
                  Totals     100%    100%    100%

  MANUFACTURING AND ASSEMBLY

  The Company's  production activities  consist  primarily  of  wiring
printed circuit boards,  assembling finished units  (and to a  limited
extent subassemblies), aligning, testing  and optically bonding  touch
sensors.   The  Company manufactures  a  limited range  of  electronic
components and  coin  doors and  mechanisms  and therefore  relies  on
outside sources for the majority of the other required components.   A
limited number of sources are available for such electronic components
and the  other raw  materials. Two  sources  supply the  Company  with
almost all of the chassis subassemblies for its two-dimensional  color
game monitors.  Chassis  subassemblies are contracted off-shore  based
on custom designs developed by the  Company.  As the Company  believes
is characteristic of other manufacturers in its industry, it has  been
confronted with long lead times and cost pressures.

  MARKETING AND SALES

  The Company  sells products  throughout the  world.   The Company's
products are sold  primarily through James  Industries, Inc., a  sales
representative  organization.     This  representation  is   currently
furnished under a Sales Representation Agreement (See Item 13. Certain
Relationships and Related  Transactions).  James  Industries, Inc.  is
headquartered in Inverness, Illinois and also utilizes the services of
regional  sub-representative firms.   The  Company  maintains its  own
internal sales staff primarily for sales of products not covered under
the Sales Representation Agreement, repair and service of its products
and to support its external sales representative organization.
<PAGE>
  (c) (iv)   The Company  is licensed on a  non-exclusive basis  under
certain patents owned by RCA  Corporation, covering the technical  and
electrical design of color  display and video  monitor chassis.   Fees
under these licenses  are based  on the  number of  units shipped  and
amounted to less than 0.2% of total 1998 revenue.  Although certain of
these licenses may expire in the  future, it has been the practice  of
the Company to renew  such licenses on  substantially the same  terms.
However, failure of  the Company  to obtain  renewal of  any of  these
licenses could  have  a materially  adverse  effect on  the  Company's
business, financial condition and results of operations.

  (c) (v)    The Company's business is generally not seasonal.

  (c) (vi)   The Company has no unique or unusual  practices  relating
to working capital items.

  (c) (vii)  The  Company's  largest  customer   accounted  for  total
revenues of 33%, 34% and 18% in 1998, 1997 and 1996, respectively.

  (c) (viii) The  Company's 1998  year-end backlog  was  approximately
34,000 monitors representing approximately three months sales.  It  is
the Company's experience that well over 90 percent of backlog  results
in revenue recognition.

  (c) (ix)   No material portion of the Company's business is  subject
to re-negotiation of  profits or termination  of contracts or  subcon-
tracts at the election of the Government.

  (c) (x)  The  Company  encounters   intense  competition  from  many
domestic and foreign manufacturers.  Due to the nature of its business
and the absence  of reliable industry  statistics, the Company  cannot
estimate its position in  relation to its  competitors.  However,  the
Company recognizes that some  competitors have greater  financial  and
personnel resources, handle more extensive lines of products,  operate
larger facilities and price some products more competitively than  the
Company.   Although  the  Company believes  that  the  prices  of  its
products are competitive, it  endeavors to meet competition  primarily
through  the  quality  of  its  product  line,  service  and  delivery
reliability and new product innovations.

  (c) (xi) During  1998, the  Company spent  approximately $1,536,000
for product engineering, research  and development costs, compared  to
$1,786,000 in 1997 and $1,701,000 in 1996.

  (c) (xii) Compliance with federal, state and local provisions which
have been enacted  or adopted  regulating the  discharge of  materials
into the environment, or otherwise relating  to the protection of  the
environment, has  no material  effect upon  the capital  expenditures,
earnings and competitive position of the Company.

  (c) (xiii) At December 31, 1998, the Company employed approxi mately
199 persons.  The Company believes its relationship with its employees
is satisfactory.

  (d) Export sales were  21 percent of s ales in 1998,  22 percent in
1997 and 24 percent in 1996.
<PAGE>
Item 2.  PROPERTIES

  The Company's plant, which is  owned by the Company,  is located  at
2701 North Kildare Avenue in Chicago, Illinois.  It has  approximately
207,000 square  feet of  floor space.  Not less  than 100,000  of  the
207,000 square  feet  of  the  plant are  at  any  time  dedicated  to
production.   Offices for  engineering, sales  and administration  are
also located at  that facility.   The plant is  in good condition,  is
well maintained, and  currently has  excess production  capacity.   In
1998, the plant operated at an average 59 percent capacity.  The plant
is not subject to any material encumbrance.

Item 3.  LEGAL PROCEEDINGS

  None

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

  No matters were submitted  to a vote of  the Company's  shareholders
during the fourth quarter of 1998.
<TABLE>
                 EXECUTIVE OFFICERS OF THE REGISTRANT
                                              
                                                                     Year First
                                                                    Elected As An
     Name                         Office                  Age     Executive Officer
<S>                  <C>                                  <C>     <C>
Anthony Spier        Chairman of the Board, President               
                     and Chief Executive Officer           55           1994

Randall S. Wells     Executive Vice President and        
                     General Manager                       47           1980

George B. Toma       Vice President of Finance,
                     Chief Financial Officer and
                     Treasurer                             31           1996

John S. Pircon       Vice President of Marketing           40           1994

Mark E. Komorowski   Vice President of Service and Coin    33           1994

Kathleen E. Hoppe    Director of Information Technology    53           1994

Gene Ahner           Director of Human Resources
                     and Corporate Secretary               62           1994

Larry Mahl           Director of Materials                 51           1989

Eric Slagh           Director of Quality                   33           1997

Jeff Sterling        Vice President of Engineering         40           1998
</TABLE>
Unless otherwise  indicated,  each  executive officer  has  served  in
various executive capacities with the Company for the past five years.
<PAGE>
George B.  Toma  joined the  Company  in  1990 and  was  elected  Vice
President  of  Finance,  Chief  Financial  Officer  and  Treasurer  in
February, 1997.    Mr. Toma  was  previously elected  Chief  Financial
Officer and Treasurer in  April, 1996 and  prior thereto held  various
accounting positions  within  the  Company.    Prior  to  joining  the
Company, Mr. Toma was an auditor  with Laventhol & Horwath.  Mr.  Toma
is a certified  public accountant  as well as  a certified  management
accountant.

Mark E. Komorowski joined the Company in 1990 and was elected  as Vice
President in April, 1996. Prior to this election, Mr.  Komorowski held
the position  of  Controller.    Prior to  joining  the  Company,  Mr.
Komorowski was an auditor with Laventhol & Horwath.

Eric Slagh joined  the Company as  Director of Quality  in May,  1997.
Prior to joining the Company, Mr. Slagh was Quality Assurance  Manager
at Danfoss Electronic Drives.

Jeff Sterling joined the Company as  Vice President of Engineering  in
November, 1998.    Prior to  joining  the Company,  Mr.  Sterling  was
Development Director of Commercial Products at Zenith Electronics.


                               PART II

Item 5.  MARKET  FOR  THE  REGISTRANT'S COMMON  STOCK  AND  RELATED
STOCKHOLDERS MATTERS.

  The information required by  this Item is  set forth in  Exhibit 13
under the caption  "Common Share Market  Price," which information  is
contained in the Company's Annual Report to Shareholders for the  year
ended December 31, 1998, and which information is hereby  incorporated
herein by reference.

Item 6.  SELECTED FINANCIAL DATA

  The information required by  this Item is  set forth in  Exhibit 13
under the  caption "Selected  Financial  Data," which  information  is
contained in the Company's Annual Report to Shareholders for the  year
ended December 31, 1998, and which information is hereby  incorporated
herein by reference.

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

  The information required by this Item  is set forth in   Exhibit 13
under the caption "Management's  Discussion and Analysis of  Financial
Condition and Results of Operations" which information is contained in
the Company's  Annual  Report  to  Shareholders  for  the  year  ended
December 31, 1998, and which information is hereby incorporated herein
by reference.
<PAGE>
  Because the  Company wants  to provide  shareholders and  potential
investors with  more meaningful  and useful  information, this  Report
contains certain forward-looking statements  (as such term is  defined
in the Securities Act of 1933, as amended, and the Securities Exchange
Act  of  1934,  as  amended)   that  reflect  the  Company's   current
expectations regarding the future  results of operations,  performance
and achievements of the Company.  Such forward-looking statements  are
subject  to  the  safe  harbor  created  by  the  Private   Securities
Litigation Reform  Act  of 1995.    The Company  has  tried,  wherever
possible, to identify these forward-looking statements by using  words
such as  "anticipate,"  "believe," "estimate,"  "expect"  and  similar
expressions.  These statements  reflect the Company's current  beliefs
and are based on information currently available to it.   Accordingly,
these statements  are  subject  to certain  risks,  uncertainties  and
assumptions  which   could  cause   the  Company's   future   results,
performance or achievements to differ materially from those  expressed
in, or implied by, any of these statements.  The Company undertakes no
obligation to release  publicly the results  of any  revisions to  any
such forward-looking statements that may be made to reflect events  or
circumstances after  the  date  of  this  Report  or  to  reflect  the
occurrence of unanticipated events.

Item 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

  The following financial statements together with  the notes thereto
are set forth  in Exhibit 13,  which information is  contained in  the
Company's Annual Report  to Shareholders for  the year ended  December
31,  1998  and  which   information  hereby  incorporated  herein  by
reference.

Balance Sheets as of December 31, 1998 and 1997

Statements of Earnings  for years ended  December 31,  1998, 1997  and
1996

Statements of  Shareholders' Equity for years ended December 31, 1998,
1997 and 1996 Statements of Cash Flows  for years  ended  December 31, 
1998, 1997  and 1996

Notes to Financial Statements

Independent Auditors' Report

  Quarterly financial data for the years ended  December 31, 1998 and
1997 are set forth  in Exhibit 13  in Note 13  of "Notes to  Financial
Statements" and  are  contained  in the  Company's  Annual  Report  to
Shareholders for the year ended  December 31, 1998, which  information
is hereby incorporated herein by reference.

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

  None
<PAGE>
                               PART III

Item 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

  a.  Directors
  The information required by this Item is set forth in the Company's
Proxy Statement for the Annual Meeting  of Shareholders to be held  on
April 27,  1999,  under  the  captions  "Election  of  Directors"  and
"Compliance with Section 16(a) of the Exchange Act," which information
is hereby incorporated herein by reference.

  b.  Executive Officers
  Reference is made to "Executive Officers of the Registrant" in Part
I hereof.

Item 11.  EXECUTIVE COMPENSATION

  The information required by this Item is set forth in the Company's
Proxy Statement for the Annual Meeting  of Shareholders to be held  on
April 27,  1999,  under  the captions  "Summary  Compensation  Table,"
"Option Grants  in 1998,"  "Aggregated Option  Exercises in  1998  and
Option Values at December 31, 1998," "Report of Board of Directors  on
Compensation," and  "Compensation  Committee  Interlocks  and  Insider
Participation," which  information is  hereby incorporated  herein  by
reference.

Item  12.  SECURITY  OWNERSHIP   OF  CERTAIN  BENEFICIAL  OWNERS   AND
MANAGEMENT

  The information required by this Item is set forth in the Company's
Proxy Statement for the Annual Meeting  of Shareholders to be held  on
April 27, 1999,  under the caption  "Securities Beneficially Owned  by
Principal Shareholders and  Management," which  information is  hereby
incorporated herein by reference.

Item 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

  The Information required by this Item is set forth in the Company's
Proxy Statement for the Annual Meeting  of Shareholders to be held  on
April 27, 1999, under  the caption "Compensation Committee  Interlocks
and Insider Participation," which  information is hereby  incorporated
herein by reference.

                               PART IV

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

  a. (1)   Financial Statements    The  information required  by this
Item is set forth in Part II, Item 8 of this Report.  The  Independent
Auditors  Report  is  set  forth  following  the  Financial  Statement
Schedule referred to under (2) below.

  (2)  Financial  Statement Schedules    The information  required by
this Item is set forth following the signature page of this Report.
<PAGE>
  (3)  Exhibits

The following exhibits are filed herewith:

  3.1.  Articles of  Incorporation of the Company,  as amended, filed
as Exhibit 3.1  of the Company's  Annual Report on  Form 10-K for  the
year ended December 31, 1994 and incorporated herein by reference.

  3.2. By-Laws of the  Company, as amended,  filed as Exhibit  3.2 of
the Company's Annual Report on Form  10-K for the year ended  December
31, 1994 and incorporated herein by reference.

  10.1*.   Amended  Employment  Agreement  dated February  29,  1996,
between the  Company  and Anthony  Spier  and incorporated  herein  by
reference.

  10.2.  License Agreement dated January 1, 1995, between the Company
and RCA Corporation and incorporated herein by reference.

  10.3. Agreement dated July  1, 1997, between t he Company and Local
1031, I.B.E.W., AFL-CIO, and incorporated herein by reference.

  10.4*. Wells-Gardner  Electronics  Corporation  Employee 401K  Plan
dated January 1,  1990 and Amendment  1 dated February  11, 1992,  and
Amendment 2 dated  January 20,  1994, filed  as Exhibit  10.10 of  the
Company's Annual Report on Form 10-K  for the year ended December  31,
1993 and incorporated herein by reference.

  10.5*.   Wells-Gardner  Electronics  Corporation  1996  Nonemployee
Director Plan, filed as Annex A  to the Company's Proxy Statement  for
the Annual Meeting of  Shareholders to be held  on April 23, 1996  and
incorporated herein by reference.

  10.6*. Wells-Gardner Electronics  Corporation Amended  and Restated
Incentive Stock  Plan, as  amended and  filed as  Exhibit 4.1  of  the
Company's Form S-8, dated August 21, 1998.

  10.7. Credit  Agreements  dated  June  5,  1998,  between  American
National Bank and  Trust Company and  the Company,  filed as  Exhibits
2.2, 2.3, 2.4 and 2.5 of the Company's Form 8K/A dated August 5,  1998
and incorporated herein by reference.

  10.8. Amended  and  Restated Sales  Representative  Agreement dated
December 9, 1998 and incorporated by  reference in this Annual  Report
on Form 10-K.

  10.9. Guaranty Agreement dated  December 9, 1998,  between James J.
Roberts Jr.,  John  R. Blouin  and  the Company  and  incorporated  by
reference in this Annual Report on Form 10-K.

  10.10. Promissory  Note  dated  December  9,  1998,  between  James
Industries, James J. Roberts Jr., John  R. Blouin and the Company  and
incorporated by reference in this Annual Report on Form 10-K.
<PAGE>
  10.11.  Voting Rights  Agreement dated December 9,  1998, among the
Company, Anthony Spier,  Randall S.  Wells, John R.  Blouin, James  J.
Roberts, Jr. and James Industries, Inc. and incorporated  by reference
in this Annual Report on Form 10-K.

  13. Certain portions of the Company's Annual Report to Shareholders
for the year ended  December 31, 1998  as specified in  Part I and  II
hereof to be incorporated by reference  in this Annual Report on  Form
10-K.

  23.  Consent of KPMG LLP.

  27.  Financial Data Schedule

  *Management contract or compensatory plan or arrangement.

  b.  Reports on Form 8-K   No reports on Form 8-K  were filed during
the last quarter ended December 31, 1998.

                              SIGNATURES

  Pursuant to the requirements  of Section 13  or 15(d) of  the Secu-
rities Exchange  Act of  1934, the  Registrant  has duly  caused  this
report to be signed on its  behalf by the undersigned, thereunto  duly
authorized.

                WELLS-GARDNER ELECTRONICS CORPORATION

By: /S/ ANTHONY SPIER                                       
    Anthony Spier            Chairman of the Board, 
                             President and Chief 
                             Executive Officer       February 10, 1999

    /S/ GEORGE B. TOMA                                     
    George B. Toma CPA, CMA  Vice President of 
                             Finance, Chief 
                             Financial Officer and 
                             Treasurer               February 10, 1999


     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 on the dates indicated.
<PAGE>
Signature                         Title                    Date

/S/ ANTHONY SPIER
Anthony Spier                Chairman of the Board, 
                             President and Chief 
                             Executive Officer       February 10, 1999

/S/ JOHN R. BLOUIN
John R. Blouin               Director                February 10, 1999

/S/ MARSHALL L. BURMAN
Marshall L. Burman           Director                February 10, 1999

/S/ IRA J. KAUFMAN
Ira J. Kaufman               Director                February 10, 1999

/S/ FRANK R. MARTIN
Frank R. Martin              Director                February 10, 1999

/S/ JAMES J. ROBERTS, JR.
James J. Roberts, Jr.        Director                February 10, 1999

/S/ RANDALL S. WELLS
Randall S. Wells             Director                February 10, 1999

/S/ ERNEST R. WISH
Ernest R. Wish               Director                February 10, 1999

                          FINANCIAL SCHEDULE

  Schedules not  included with  this addi tional financial  data have
been  omitted  because  they  are  not  applicable  or  the   required
information is shown in the financial statements or notes thereof.


SCHEDULE II
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES

ALLOWANCE FOR DOUBTFUL ACCOUNTS

          Balance at
          Beginning       (1)          (2)         Balance at
  Year    of Period    Additions    Deductions    End of Period

  1996      297,866       10,000       200,933          106,933

  1997      106,933      175,000        17,633          264,300

  1998      264,300       36,133       215,433           85,000

(1) Provision for bad debt.
(2) Accounts receivable written off against the allowance.