Xedar Corporation
2500 Central Avenue
Boulder, CO 80301

March 20, 1998

Securities and Exchange Commission
Washington, D.C. 20549

Pursuant to the requirements of the Securities Exchange Act
of 1934, we are transmitting herewith the attached Form
10KSB.
The filing fee of $250.00 has been remitted by wire to the
Mellon Bank for our CIK account.

Sincerely,

Hans R. Bucher

Hans R. Bucher
President



U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
Form 10-KSB
(Mark One):
(x) Annual Report Pursuant to Section 13 or 15(d) of the Securities
    Exchange Act of 1934 for the fiscal year ended
    December 27, 1997

or

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

Commission File Number  0-8356

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

        Colorado

(State or other jurisdiction of incorporation or organization)

             84-0684753
(I.R.S. Employer Identification No.)

        2500 Central Avenue, Boulder, CO            80301
        (Address of principal executive offices)  (Zip Code)

Registrant's telephone number incl. Area code: 303) 443-6441

Securities registered pursuent to Section 12(b) of the Act:  None
Title of each class   Name of each exchange on which registered
                                None


Securities registered pursuent to Section 12(g) of the Act:
Common Stock, No Par Value
(Title of class)


(Title of class)

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 pursuent to
Item 405 of Regulation S-K (#229.405 of this chapter) is not contained
herein, and will not be contained, to the best of the registrant's
knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or
any amendment to this Form 10-KSB. [   ]

State the aggregate market value of the voting stock held by
non-affiliates of the registrant. The aggregate  market value shall
be computed by reference to the price at which the stock was sold,
or the average bid and asked prices of such stock, as of a specified
date within 60 days prior to the date of filing. (See definition of
affiliate in Rule 405, 17 CFR 230.405).

Note - If determination as to whether a particular person or entity
is an affiliate cannot be made without involving unreasonable
effort and expense, the aggregate market value of the common stock
held by non-affiliates may be calculated on the basis of assumptions
reasonable under the circumstances, provided that the assumptions
are set forth in this Form.

APPLICABLE TO REGISTRANTS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed  all
documents and reports required to be filed by Section 12, 13 or
15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by court.
                                                         Yes    No
(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date.

DOCUMENTS INCORPORATED BY REFERENCE
List hereunder the following documents if incorporated by reference
and the Part of the Form 10-K (e.g., Part I, Part II, etc.) into
which the document is incorporated: (1) Any annual report to
security holders; (2) Any proxy or information statement; and (3)
Any prospectus filed pursuant to Rule 424(b) or (c) under the
Securities Act of 1933.  The listed documents should be clearly
described for identification purposes (e.g., annual report to
security holders for fiscal year ended December 24, 1980).



PART I


ITEM 1. DESCRIPTION OF BUSINESS

Business Development

Xedar Corporation (hereinafter referred to as the "Company") was
organized as a Colorado corporation on May 6, 1974.  During the
last three years, the business has remained constant in form and operation.

Business of Issuer

 The Company's principal business is the design, development,
fabrication and sale of high technology electro-optical equipment
and related electrical equipment, including devices such as cameras,
video systems, video amplifiers, image systems, electro-optical
transmissions, electrical test equipment, etc.

The Company's primary electro-optical equipment consists of its
line of CCD- ("Charge Coupled Devices") Cameras and related equipment.
These CCD-Cameras are used in medical X-ray diagnostic and procedural
applications as well as in scientific and research applications.
The operation and data display of these cameras is computer controlled
and the information displayed is on a digital computer that can be
computer manipulated.

The Company's other operations include OEM-manufacturing of
CCD-Cameras, engineering programs and single customer programs.

The Company is offering a pyro-electronic vidicon camera
("P.E.V. Camera") for sale to the general public.  The P.E.V. camera
is an advanced infrared thermal imaging television camera which
transmits and displays images created by heat on a television
monitor screen.  The display of heat on the television screen is
represented by varying shades of gray, from an almost white color
at higher temperatures to gray and black at lower temperatures.
The actual temperature of an object of interest is directly
measurable through the P.E.V. camera optical system, and the
emissivity corrected temperature reading is numerically displayed
in the television image.

General Production Programs and Products

The major portion of the Company's business includes the design,
development and production of CCD-Cameras for OEM customers.
These programs are in response to customer requirements and the
OEM-Production quantities are from a few cameras per year to several
hundred per year per customer.

Depending on the application and customer requirements,
the complexity, resolution and data rates of the CCD-Cameras vary.

The Company is presently offering the following range of cameras
in end user and OEM configurations:

Fiber Optic Coupled Cameras - In many applications, the use of
lens coupling from the image to the sensor is not suitable.
This is the case in applications where an image intensifier
output phosphor is to be imaged, or in X-ray imaging systems
where the light output of the X-ray converter screen is to be
imaged.  Lens coupling in these applications is possible, however,
at a great loss of the available light due to the low coupling
efficiency of a lens system.  For such applications, the Company
has developed a low cost technique to bond imaging (fiber-optic)
FO-Tapers or windows directly to the CCD.  The FO-Tapers can have
positive or negative magnification to match the field of view
required.  CCD-Cameras with FO-coupling are for demanding applications
in the scientific and medical field and require low dark current
at long integration times.  The Company has developed methods to
Peltier cool the CCD's working temperatures to as low as
-60 degrees Celsius.

Lens Coupled Cameras - Certain applications require lens coupling
to image the object.  The Company manufactures a wide range of OEM
and end user systems for such applications.  Besides a single board
camera with 1 million pixels of resolution, the Company is
manufacturing a complete camera with 4 million pixels of resolution.

Data Rates - The Company designs and manufactures CCD-Cameras with
readout data rates as low as 10 kHz and as high as 40 MHz.

Dynamic Range - The dynamic range of a camera is its ability to
resolve shades of gray.  This is accomplished by digitizing the
video output signal from the CCD.  The dynamic range of the
CCD-Cameras designed and manufactured by the Company range
from 10 BIT (1000:1 dynamic range) for fast readouts to
16 BIT (6500:1 dynamic range) for scientific application readouts.

Related Engineering - Most applications of CCD-Cameras require
data transmission from the Camera to the computer.
The Company has developed parallel data links to transmit
12 BIT digital information and has developed high speed FO-serial data links.

Engineering Programs

 The Company also develops proposals in response to a set of
specifications submitted by a potential customer for the development
of specific equipment or processes.  This effort may or may not
result in the development of a prototype device, depending on the
nature of the request.  The potential customer generally seeks to
obtain design capabilities for the manufacture of specific
electro-optical or related high technology devices.
Fees for the Company's design and development services are
often contingent upon execution of a contract with the customer for
the creation, production and manufacture of a designed prototype.

Single Customer Production Programs

In addition to its general production program, wherein the
Company manufactures certain of its products for general sale
to the public, the Company also produces specific products for
customers who have executed pre-production contracts or an
engineering contract, wherein the Company will produce the
product which it has developed and designed, which might be a
product which is not available for sale to the general public.

Marketing and Sales

The primary emphasis of the Company's marketing and sales
effort is the sale of OEM cameras and to obtain engineering
and manufacturing contracts in related fields.

Contracts for engineering programs and single customer production
programs are usually negotiated on an ad hoc basis.
Potential customers include past customers, governmental agencies,
national laboratories and third party referrals.


Competition

The Company has incurred and will continue to incur competitive
pressure in all phases of its business.  Potential competitors
are numerous, have substantially more technical resources, and
possess financial, marketing and other resources superior to those
available to the Company.

In connection with the design of electro-optical equipment, numerous
national and multi-national electronic and aerospace companies
maintain in-house capabilities to compete with the Company on a
project basis.  The companies include Martin Marietta,
Ball Corporation, Sanders Corporation, Loral, Hughes and Boeing.
In addition, there are at least a dozen smaller specialty firms
who may compete with the Company on a contract/bid basis.
Although the Company's small size is often a disadvantage when
bidding on substantial projects, there is no objective manner
(price, warranty, services, etc.) to differentiate the Company's
design and development capabilities from those of its competitors.

In connection with the Company's CCD-Cameras, the Company
currently competes with Photometrics, Sierra Scientific,
Princeton Instruments and several others.  The Company
believes that competition in the CCD-Camera industry involves
such factors as performance, price and warranty.  In this
regard, the Company offers competitively priced systems with
state of the art performance from "no frills" subassemblies
to complete systems.

Additional Information

The Company's electro-optical equipment may be assembled from
components produced by various suppliers.  Although the components
are highly sophisticated devices, the Company is not dependent on
any single supplier including the supply of CCDs.

Although the Company requests down payments or earnest money
deposits and periodic performance payments from customers during
the fabrication of its products, there is no assurance that
customers will agree to make such payments.  Therefore,
the substantial period of time between commencement of assembly
and payment upon completion may subject the Company to increased
risks and additional working capital requirements.

For the fiscal years ended December 28, 1996 and
December 27, 1997, the Company expended $196,209 and $49,353
respectively, upon Company-sponsored research and development.
The Company offers research and development services on a fee
basis for its customers' products.  No revenue associated with
such services was earned in 1996 or 1997.

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, are not expected to have a material effect
on capital expenditures, earnings or the competitive position of
the Company.

Employees

As of December 27, 1997, the Company employed seven persons,
including its president/treasurer, one engineer, two technicians
and three administrative personnel, full time.

ITEM 2. DESCRIPTION OF PROPERTY

The Company leases its office and plant facilities from Central
Avenue Investment, a general partnership, whose partners include
Hans Bucher, the Company's president and a director, and Marlis Bucher,
the Company's secretary.  The Company's facilities are located
at 2500 Central Avenue, Boulder, Colorado 80301 and consist of
approximately 6,895 square feet.  The Company has periodically
renewed and amended this lease and has committed to a three-year
term beginning September 15, 1996 with an option to renew for another
three years.  The monthly rental is $4,050.  On each anniversary date
of the lease, the lease payments will be adjusted for the percentage
increase in the consumer price index.  The Company believes that the
lease is fair and reasonable and on as beneficial terms as could be
obtained from any unaffiliated third party consistent with other
rentals assessed in the market area for similar facilities.


ITEM 3. LEGAL PROCEEDINGS

No material legal proceedings to which the Company is a party or
of which any of its property is the subject are pending and no such
proceedings are known by the Company to be contemplated.
The Company is not presently a party to any litigation or
administrative proceedings with respect to its compliance with
federal, state or local provisions which have been enacted
regarding the discharge of materials into the environment or
otherwise relating to the protection of the environment, and no such
proceedings are known by the Company to be contemplated.


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

No matter was submitted during the fourth quarter of the fiscal
year covered by this report to a vote of security holders, through
the solicitation of proxies or otherwise.


PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

(a)      The Company's common stock is traded in the over-the-counter market.
         The price ranges* (in fractions of one dollar) of the bid quotations
         of the Company's common stock during its last two fiscal years,
         as provided to the Company by local stock brokerage firms,
         are set forth below:
                                    1996             1997
     Quarter ended:             High    Low      High    Low
      March 31/March 29        $ 1 3/4   3/4     1 1/8    1/2
      June 30/June 28            1 3/4   3/4     1        1/8
      September 28/September 27  1 1/8   1/2       2/3    1/3
      December 28/December 27    1 1/8   1/2       2/3    1/3

*   The quotations set forth herein are representative of inter-dealer prices.
    Inter-dealer markets change throughout the day and do not include
    markup, markdown, or commissions.

(b) As of December 27, 1997, there were approximately 150 record holders
    of the Company's common stock.

(c) The Company has not paid any cash dividends to date.


ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

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

Sales and Gross Profits

During the past fourteen years, the Company had three basic sources
of revenue: commercial products, design and development contracts,
and single customer production programs.

Sales by product lines for 1996 and 1997 were (in thousands):
                                             1996             1997

Commercial Products                          $ 31              30
Design and Development Contracts              587             546
Single Customer Production Programs           179              12

                                             $797             588
                                             ====             ===

Xedar product sales of $30,285 were 5% of sales in 1997 representing
a decrease of $921 as compared to 1996.  The marketing effort for
this product has been reduced since the sales potential for tube
based infrared cameras is insignificant.


Design and development contract sales decreased by $41,000 and
amounted to approximately 93% of sales in 1997 in comparison to 74%
during 1996.  This decrease is primarily due to lower levels of work
on existing engineering contracts and no new contracts.

Single Customer Production Program sales decreased in 1997 and
amounted to approximately 2% of 1997 sales in comparison to
22% in 1996.  This decline is primarily due to a cancellation
of a production contract.

No new production contracts were obtained in 1997.

The gross profit for 1997 was less than 1% as compared to 17.7% in
1996 due to reduced sales volume and lower absorption of overhead.

Research and Development

A total of $49,353 were expended during 1997, representing
approximately 8% of sales, compared to $196,209 expended in 1996.
The 1997 funds were primarily used to evaluate high speed
amplifiers for various applications and the 1996 funds were directed
towards the development of high resolution, high speed video
processing for CCD cameras and the development of digital signal
processing electronics to take advantage of the multiple video
output capability of high speed, high resolution CCDs.

Selling, General and Administrative Expenses

Selling, general and administrative expenses in 1997 amounted
to $267,253 as compared to $250,526 in 1996.  These expenses
increased by $16,727 in 1997 primarily as a result of wage
increases and attempts to obtain new customers.

Interest and Miscellaneous Income

Interest and miscellaneous income was $71,142 for 1997 and
$51,692 for 1996 primarily representing interest earned on
short-term cash investments.

Liquidity and Capital Resources

In recent years, the Company has financed its activities from
cash reserves and operations.  No bank financing has been used
since 1982.  As noted in the statements of cash flows, cash and
cash equivalents decreased from 1996 to 1997.  The net cash used
by operations in 1997 was $19,518.  Cash balances were also
reduced by capital expenditures of $12,468 and expenditures on
patents of $1,746.

The Company has working capital of $1,266,374 and a current
ratio of approximately 24 to 1 at December 27, 1997.

The Company's liquidity position is necessary to maintain its
ability to conduct in-house research and development enabling it
to compete in single customer contracts and to develop a commercial
product line in a highly volatile high technology market place.

The Company has addressed the Year 2000 issues.  The Company has
evaluated its computer systems and concluded that the software being
utilized is not date sensitive and adequately recognizes a four-
digit year.  The Company presently believes that the Year 2000
problem will not pose operational or financial problems for the
Company's computer systems as designed.

Recent Accounting Pronouncements

In June of 1997, the Financial Accounting Standards Board issued
Statements of Financial Accounting Standards, No. 130, Reporting
Comprehensive Income, (Statement No. 130), and No. 131, Disclosures
About Segments of an Enterprise and Related Information,
(Statement No. 131), effective for years beginning after December 15,
1997.  Statement No. 130 establishes standards for reporting and
display of comprehensive income and its components in a full set of
general-purpose financial statements.  The Company has not yet
adopted Statement No. 130.  The Company will comply with the
reporting and display requirements under this statement when
required.  Statement No. 131 establishes standards for reporting
information about operating segments and the methods by which such
segments were determined.  The Company has not yet adopted
Statement No. 131.  As the Company operates within one industry
segment, the reporting of such information is not expected to be
significant.

Forward-Looking Statements

Except for the historical information contained herein, the
matters set forth in this 10-KSB are forward-looking statements
within the meaning of the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995.  These forward-looking
statements are subject to risks and uncertainties that may cause
actual results to differ materially.  These risks are detailed from
time to time in the Company's periodic reports filed with the Securities
and Exchange Commission, including the Company's Annual Report
on Form 10-KSB, Quarterly Reports on Form 10-QSB and other periodic
filings.  These forward-looking statements speak only as of the
date hereof.  The Company disclaims any intent or obligation to
update these forward-looking statements.

ITEM 7. FINANCIAL STATEMENTS


Independent Auditors' Report

The Board of Directors and Stockholders
Xedar Corporation:

We have audited the accompanying balance sheets of Xedar Corporation
as of December 28, 1996 and December 27, 1997, and the related
statements of operations, stockholders' equity, and cash flows
for the 52 weeks ended December 28, 1996 and December 27, 1997.
These financial statements are the responsibility of the Company's
management.  Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with generally accepted
auditing standards.  Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating
the overall financial statement presentation.  We believe that
our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of
Xedar Corporation as of December 28, 1996 and December 27, 1997,
and the results of its operations and its cash flows for the
52 weeks ended December 28, 1996 and December 27, 1997 in
conformity with generally accepted accounting principles.

As discussed in Note 1 to the financial statements, the Company
changed its method of computing earnings per share in 1997.

KPMG Peat Marwick LLP

Denver, Colorado
January 30, 1998


XEDAR CORPORATION
Balance Sheets
December 28, 1996 and December 27, 1997


Assets
                                     1996              1997

Current assets:

   Cash and cash equivalents       $ 1,110,297         1,084,315
        Trade accounts receivable,
        less allowance for doubtful
        accounts of $34,463 in 1996
        and $2,436 in 1997             261,176            12,695
        Note receivable                      -            95,000
        Interest receivable              7,078             4,000
        Inventories (note 2)            54,029            32,603
        Prepaid expenses                 3,905             4,069
        Refundable income taxes         78,037             3,206

            Total current assets     1,514,522         1,235,888

Long-term receivable from
related party (note 3)                 170,629           162,879

Property and equipment, at cost
(note 4)                               127,481           139,949
Less accumulated depreciation         (102,253)         (118,324)
                                        25,228            21,625

Patents, net                            20,617            14,477

                                   $ 1,730,996         1,434,869


Liabilities and Stockholders' Equity


Current liabilities:
        Accounts payable:
              Trade                  $  24,762             3,036
              Related party (note 5)     4,950             6,293
        Accrued liabilities:
              Vacation                  31,002            35,027
              Payroll and commissions    8,271             8,540
              Payroll and other taxes    1,500             1,682
        Advance billings                38,420                -

          Total current liabilities    108,905            54,578

Stockholders' equity (note 6):
        Common stock, no par value.
        Authorized 5,000,000 shares;
        issued and outstanding
        1,837,224 shares             1,617,617         1,617,617
        Additional paid-in capital          40                40
        Retained earnings
        (accumulated deficit)            4,434          (237,366)

        Total stockholders' equity   1,622,091         1,380,291

Commitments (note 5)


                                   $ 1,730,996         1,434,869


See accompanying notes to financial statements.


XEDAR CORPORATION

Statements of Operations

52 weeks Ended December 28, 1996 and December 27, 1997

                                       1996               1997

Sales (note 7)                       $ 797,144          587,874
Cost of sales                          632,901          584,210

               Gross profit            164,243            3,664

Research and development expenses      196,209           49,353
Selling, general and
  administrative expenses              250,526          267,253

           Operating loss             (282,492)        (312,942)

Interest and miscellaneous income       51,692           71,142

Loss before income taxes              (230,800)        (241,800)

Income tax benefit (note 8)            (69,000)               -


          Net loss                   $(161,800)        (241,800)


Basic and diluted loss per
common share                         $    (.09)            (.13)

See accompanying notes to financial statements.


XEDAR CORPORATION

Statements of Stockholders' Equity

52 Weeks Ended December 28, 1996 and December 27, 1997



                                                     Retained
                                        Additional   earnings      Total
                     Common Stock         paid in  (accumulated  stockholder's
                  Shares       Amount     capital    deficit)      equity
Balance at
Dec. 31, 1995    1,837,224    $ 1,617,617     40     166,234      1,783,891

Net loss             -             -           -    (161,800)      (161,800

Balance at
Dec. 28, 1996    1,837,224    $ 1,617,617     40       4,434      1,622,091

Net loss             -             -           -    (241,800)      (241,800)

Balance at
Dec. 27, 1997    1,837,224    $ 1,617,617     40    (237,366)     1,380,291

See accompanying notes to financial statements.



XEDAR CORPORATION

Statements of Cash Flows

52 Weeks Ended December 28, 1996 and December 27, 1997

                                                  1996         1997

Net loss                                       $(161,800)    (241,800)
Adjustments to reconcile net loss to net cash
provided (used) by operating activities:
    Depreciation of property and equipment        17,172       16,071
    Amortization of patents                        1,289          526
    Loss on write-off of patents                       -        7,360
Changes in operating assets and liabilities:
         Trade accounts receivable              (103,761)     248,481
         Interest receivable                      (7,078)       3,078
         Note receivable                               -      (95,000)
         Inventories                             229,158       21,426
         Prepaid expenses                           (932)        (164)
         Refundable income taxes                 (78,037)      74,831
         Accounts payable                        (12,470)     (20,383)
         Accrued liabilities                      (7,379)       4,476
         Advance billings                         38,420      (38,420)
         Income taxes payable                    (15,961)           -

    Net cash used by operating
    activities                                  (101,379)     (19,518)

Cash flows used in investing activities:
        Capital expenditures                     (4,523)      (12,468)
        Patent expenditures                      (1,425)       (1,746)
        Long-term receivable - related party      8,328         7,750

Net cash provided (used)
by investing activities                           2,380        (6,464)

Net decrease in cash and cash
equivalents                                     (98,999)       (25,982)

Cash and cash equivalents
at beginning of year                         1,209,296      1,110,297

Cash and cash equivalents at end of year    $1,110,297      1,084,315

Supplemental disclosure of cash
flow information - cash paid
during the year for income taxes            $   24,998              -


See accompanying notes to financial statements.



XEDAR CORPORATION

Notes to Financial Statements

December 28, 1996 and December 27, 1997


 (1)    Summary of Significant Accounting Policies

(a)     Nature of Operations

The Company's principal business is the design, development,
fabrication and sale of high technology electro-optical equipment
and related electrical equipment, including devices such as cameras,
video systems, video amplifiers, image systems, electro-optical
transmissions, electrical test equipment, etc.  The Company's products
are used in medical X-ray diagnostic and procedural applications as
well as in scientific and research applications.  The Company's other
operations include OEM-manufacturing of CCD-Cameras, engineering
programs and single customer programs.

The Company's product lines include commercial products, design
and development contracts, and single customer production programs.
Sales for each of these product lines as a percentage of total
sales were 4%, 74% and 22%, respectively, during 1996, and
5%, 93% and 2%, respectively, during 1997.

The Company's customers are located primarily in the United States.

(b)     Revenue Recognition

Sales of the Company's products are recognized upon shipment.
Revenue and the related expense from product development and
similar contracts are recognized when the products have been
delivered or services are performed under the terms of the contracts.
Certain sales which allow for the right of return are recorded as
deferred revenue until such right of return expires.

The Company also uses the percentage-of-completion method of
accounting for certain contracts.  Under this method, gross
profits on individual contracts are recorded on the basis of the
Company's estimates of the percentage of costs incurred to date
to estimated total costs for each contract.  The Company makes
revisions in its cost and profit estimates as required during the
course of the contract.  Such revisions are reflected in the
accounting period in which the relevant facts became apparent.
Estimated losses on contracts are accrued at the time losses on
such contracts become reasonably determinable.

If contract costs and estimated earnings exceed related billings
on an uncompleted contract, the difference is recorded as a current
asset, construction in progress; if billings exceed related contract
costs plus estimated earnings on an uncompleted contract, the
difference is recorded as a current liability, advance billings.

(c)     Cash and Cash Equivalents

Cash and cash equivalents of $844,463 and $742,565 at December 28, 1996
and December 27, 1997, respectively, consist of treasury bills.
For purposes of the statements of cash flows, the Company considers
all highly liquid debt instruments with original maturities of
three months or less to be cash equivalents.

(d)     Note Receivable

The note receivable is recorded at carrying cost of the account
receivable when it was converted to a note.  The note bears interest
at 6 percent and is due in $25,000 monthly installments, including
interest.

(e)     Inventories

Inventories are stated at the lower of cost or market.  Cost is
determined by the first-in, first-out method.  Work in process and
finished goods inventories include charges for direct material,
direct labor, and manufacturing overhead applied in relation to
direct labor and direct material.

(f)     Property and Equipment

Property and equipment are stated at cost.  Depreciation is
computed using the straight-line method over the estimated useful
lives of the respective assets.

(g)     Patents

Costs incurred in obtaining patents are capitalized and amortized
on a straight-line basis over the life of the patent which is
estimated at 17 years.  During 1997,  patents with a book value
of $7,360 were denied by the U.S. Patent Office and were written off.

(h)     Research and Development Expenses

Research and development expenses are charged to operations as incurred.

(i)     Income Taxes

Under the asset and liability method of Statement of Financial
Accounting Standards No. 109 (SFAS) 109), deferred tax assets
and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying
amounts of existing assets and liabilities and their respective tax
bases.  Deferred tax assets and liabilities are measured using
enacted tax rates expected to apply to taxable income in the years
in which those temporary differences are expected to be recovered or
settled.  Under SFAS 109, the effect on deferred tax assets and
liabilities of a change in tax rates is recognized in income in the
period that includes the enactment date.

(j)     Loss Per Common Share

The Company adopted the provisions of SFAS No. 128, Earnings Per
Share, effective December 15, 1997.  SFAS No. 128 provides guidance
for the computation of basic and diluted earnings (loss) per share.
For the 52 weeks ended December 28, 1996 and December 27, 1997, basic
and diluted loss per common share were computed by dividing the net
loss by the weighted average number of shares outstanding of
1,837,224.  No options or warrants with a dilutive effect were
outstanding during the 52 weeks ended December 28, 1996 or
December 27, 1997.

(k)     Certain Significant Risks and Uncertainties

The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting
period.  Actual results could differ from those estimates.

(l)     Impairment of Long-Lived Assets and Long-Lived Assets to
        Be Disposed Of

Long-lived assets are reviewed for impairment whenever events or
changes in circumstances indicate that the carrying amount of an
asset may not be recoverable.  Recoverability of assets to be held
and used is measured by a comparison of the carrying amount of an
asset to the future net cash flows expected to be generated by
the asset.  If such assets are considered to be impaired, the
impairment to be recognized is measured as the amount by which
the carrying amount of the asset exceeds the fair value of the
asset.  Assets to be disposed of are reported at the lower of
the carrying amount or fair value less costs to sell.


(m)     Fiscal Year

The Company's fiscal year is a 52/53 week year ending on the last
Saturday of December.


 (2)    Inventories

Inventories consist                  December 28,       December 27,
of the following:                       1996                1997

Raw materials                        $  8,261              6,714
Work in process                        45,768             25,889

                      Total          $ 54,029             32,603

Work in process is presented net of an allowance for obsolete and
excess components of $42,480 in 1996 and $41,410 in 1997.

(3)     Long-Term Receivable From Related Party

During 1985, the Board of Directors approved the purchase of a
split-dollar life insurance plan for the Company's president.
Through December 31, 1992, the annual premiums were paid by the Company.
For years subsequent to 1992, the premiums have been or are
expected to be paid out of the earnings of the plan.
The plan provides a $750,000 death benefit plus a cash surrender value.
The Company is named beneficiary for $250,000 of the death benefit
and does not share in cash surrender value increases.
Amounts paid by the Company on behalf of the Company's president,
prior to 1992, are considered advances to the president and are
repayable without interest.  The advances are secured by the
policy benefits, including the cash surrender value, which
exceeds the carrying value of the long-term receivable
at December 27, 1997.

(4)     Property and Equipment

Cost of major classes of property and equipment is as follows:


                              Estimated      December 28,   December 27,
                             useful lives       1996            1997

Office furniture and
equipment                   5 to 10 years    $ 10,156         10,156
Production, laboratory and
other equipment             3 to 10 years     117,325        129,793

                        Total                $127,481        139,949

Depreciation expense was $17,172 and $16,071 in 1996 and 1997,
respectively.

(5)     Related Party Transactions

During 1978, the Company entered into a lease agreement for facilities
with a partnership in which the Company's president and secretary
are partners.  The Company has periodically renewed and amended
this lease and is committed to a three-year term which began
September 15, 1996.  On each anniversary date, the lease payments
are adjusted for the percentage increase in the consumer price index.
As of December 27, 1997, the monthly rental was $4,050.  Unpaid
rents were $3,950 and $4,050 at December 28, 1996 and
December 27, 1997, respectively.

The Company's rental expense for this lease was $46,528 for 1996
and $49,690 for 1997.  The Company's minimum lease commitment,
without adjustments for increases in the consumer price index,
is $48,600 for 1998 and $36,450 for 1999.

The Company has employed a member of the Board of Directors
to perform financial and accounting consulting services.
Total fees paid to this related party were $2,450 and $3,325 in
1996 and 1997, respectively.

(6)     Stockholders' Equity

In June 1994, the stockholders approved a nonqualified stock option
plan for the Company's Board of Directors and reserved 50,000
shares for issuance under the plan.  No options have been granted
under this plan.

Under the terms of the Company's Incentive Stock Option plan
(ISO), the Board of Directors has reserved 200,000 shares for grant,
of which 160,000 shares remain available for grant.
There were no stock options issued or exercised during 1996 or 1997.
At December 28, 1996 and December 27, 1997 the Company has no
outstanding stock options.

 (7)    Significant Customers

Significant customers have accounted for sales as follows:



                                            1996          1997

       Customer A                             28%          34%
       Customer B                             17%           8%
       Customer C                              -           34%


 (8)    Income Taxes

Income tax benefit consists of the following:


                                              1996          1997
Current:
  Federal                                  $ (62,000)         -
  State                                       (7,000)         -

                                             (69,000)         -

Deferred:
  Federal                                          -          -
  State                                            -          -

                                           $ (69,000)

Income tax expense (benefit) differed from the amounts computed by
applying the U.S. federal income tax rate of 34% to loss
before income taxes as a result of the following:

                                            1996             1997

Computed "expected" tax benefit            $(78,472)         (82,212)
Expenses not deductible
for income tax purposes                       2,200            2,320
State taxes, net of federal impact           (4,600)          (6,490)
Change in the valuation allowance
for deferred tax assets                      10,400           90,600
Phase in of graduated income tax rate            -            (4,100)
Other, net                                   1,472              (118)

         Income tax benefit                $(69,000)               -

The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and deferred tax liabilities
are presented below:

                                           December 28,  December 27,
                                              1996           1997

Deferred tax assets:
   Accounts receivable, due
to allowance for doubtful accounts         $ 13,100             900
   Compensated absences, due
to accrual for financial statement
purposes                                     11,800          13,300
Net operating loss carry forwards                 -          90.600

Total gross deferred tax assets              24,900         104,800

Less valuation allowance                    (21,200)        (99,600)

Net deferred tax assets                       3,700           5,200

Total deferred tax liabilities -
plant and equipment, due to
differences in basis and
depreciation                                (3,700)          (5,200)

Net deferred income taxes                  $     -                -

The valuation allowance for the gross deferred tax assets has been
provided to recognize no net deferred tax assets.  Primarily due to
the Company's losses in 1996 and 1997, management believes that
deferred tax assets are not more likely than not recoverable.


ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE

None.

PART III

ITEM 9. DIRECTORS , EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL
PERSONS, COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

Information regarding the directors and executive officers of
the Registrant is incorporated by reference to the Company's
definitive proxy statement to be filed pursuant to Regulation
14A relating to the annual meeting of stockholders at which
directors are to be elected, hereinafter referred to as
"the Company's definitive proxy statement."

ITEM 10.        EXECUTIVE COMPENSATION

Information regarding management remuneration and transactions
is incorporated by reference to the Company's definitive proxy
statement.

ITEM 11.        SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
                AND MANAGEMENT

Information regarding the security ownership of certain beneficial
owners and management of the Company is incorporated by reference
to the Company's definitive proxy statement.

ITEM 12.        CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Information regarding certain relationships and related transactions
is incorporated by reference to the Company's definitive proxy statement.

PART IV

ITEM 13.        EXHIBITS AND REPORTS ON FORM 8-K

(a)     The following documents are filed as a part of this report:

1.      Financial Statements

        Independent Auditors' Report
        Balance Sheets - December 28, 1996 and December 27, 1997
        Statements of Operations - 52 weeks ended December 28, 1996
        and December 27, 1997
        Statements of Stockholders' Equity - 52 weeks ended
        December 28, 1996 and December 27, 1997
        Statements of Cash Flows - 52 weeks ended December 28, 1996
        and December 27, 1997
        Notes to Financial Statements

2.      Exhibits: Articles of Incorporation and Bylaws of the Company -
        Incorporated by reference to the Exhibits to the Notification
        under Regulation A filed on December 6, 1974.

(b)     No reports on Form 8-K have been filed during the last quarter
        of the period covered by this report.

SIGNATURES


In accordance with Section 13 and 15(d) of the Exchange Act,
the Registrant caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.



        XEDAR CORPORATION
        (Registrant)


        By: Hans R. Bucher

               Hans R. Bucher, President


        Date: March 20, 1998


In accordance with the Exchange Act, this report has been signed
below by the following persons on behalf of the Registrant and
in the capacities and on the dates indicated.


Signature                   Title                 Date
                        President, Treasurer,
                        Chief Executive and
Hans R. Bucher          Financial Officer and     March 20, 1998
___________________     Director                  __________________
Hans R. Bucher


Michael J. O'Connell    Director                  March 20, 1998
____________________                              __________________
Michael J. O'Connell


Gary A. Agron           Director                  March 20, 1998
____________________                              __________________
Gary A. Agron


Marlis Bucher           Secretary                 March 20, 1998
____________________                              __________________
Marlis Bucher