SECURITIES AND EXCHANGE COMMISSION
                           WASHINGTON, D.C. 20549

                                 FORM 10-K

                   PURSUANT TO SECTION 13 OR 15(D) OF THE
                      SECURITIES EXCHANGE ACT OF 1934

      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THIS SECURITIES
                    EXCHANGE ACT OF 1934 (FEE REQUIRED)

For the fiscal year ended May 31, 1998       Commission file number 1-6775

                            HOWARD B. WOLF, INC.
           (Exact name of registrant as specified in its charter)

               Texas                                   75-0847571
      (State or other jurisdiction of              (I.R.S. Employer
      incorporation or organization)            Identification Number)

     3809 Parry Avenue, Dallas, Texas                  75226-1753
 (Address of principal executive offices)              (Zip Code)

                               (214) 823-9941
                      (Registrant's telephone number)

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

                                              Name of each exchange
          Title of each class                  on which registered
     Common Stock, $0.331/3 par value        American Stock Exchange
        Securities registered pursuant to Section 12(g) of the Act:
                                    None
     
     Indicate  by check  mark  whether  the registrant  (1)  has filed  all
reports required  to be  filed by  Section 13  or 15(d)  of the  Securities
Exchange  Act of  1934 during  the  preceding 12  months 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.
     
     The aggregate market  value of Registrant's common stock  held by non-
affiliates  (based  upon the  closing  sale  price  on the  American  Stock
Exchange) on August 10, 1998 was approximately $3,238,937.
     
     As of  August 10, 1998, there were 1,056,191 shares  of common  stock
outstanding.
<PAGE>                    
                    DOCUMENTS INCORPORATED BY REFERENCE
     
     Portions of the  definitive Proxy Statement for the  Annual Meeting of
Stockholders on September 15, 1998  are incorporated by reference into Part
III. 


                            HOWARD B. WOLF, INC.
                                 FORM 10-K

                               ANNUAL REPORT
                   FOR THE FISCAL YEAR ENDED MAY 31, 1998

                                   PART I

Item 1. Business

General

     Howard B. Wolf,  Inc. (the "Company"), incorporated under  the laws of
the State of Texas in 1952, designs, manufactures and sells women's fashion
apparel  consisting primarily  of dresses,  suits,  shirts and  coordinated
groups of sportswear.
     The  Company's products  are  designed and  presented for  each season
(fall,holiday,  spring  and  summer).  Sales  generally  do  not  fluctuate
materially from  quarter to quarter as a  result of seasonal sales patterns
of the Company's  business. Accordingly, there are  no significant seasonal
fluctuations in quarterly fiscal year shipments.
     Working  capital requirements do not fluctuate materially. The Company
produces  merchandise  to  meet  sales  orders and  does  not  carry  large
inventories to meet estimated sales requirements. The Company does not sell
on  consignment.  The  merchandise return  policy  provides  for return  of
defective merchandise within ten days after receipt. Primary sale terms are
8/10  EOM and Net/10 EOM. Requests are  received for extended payment terms
for up to thirty days from due date primarily for shipments made early in a
season. These requests are generally granted subject to the credit standing
of the customer. Extended payment requests do not have a material effect on
cash flow.

Principal Products and Markets


     The  Company merchandises  its products  (fashion  apparel for  women)
under the following labels:
          HOWARD WOLF DRESS label-comprised of dresses, ensembles and suits
and  retails   from  approximately  $100  to  $250.  It  is   intended  for
career/professional  and fashionable women  who desire current  styling and
good taste. The Howard Wolf Dress label, introduced in 1956, is well known
in the fashion field.

          HOWARD WOLF SPORTSWEAR label-designed for career/professional and
fashionable  women, is presented  as separate shirts,  pants, tops, jackets
and sweaters in coordinated groups. Introduced during the Fall 1972 season,
this label retails from approximately $50 to $250.
<PAGE>
          ERNESTO W label-was introduced in 1976. This  label is currently
used on special request only. It retails from approximately $40 to $150.

          PRET-A-PORTE label-established in  1969,  is  currently used  on
special request only. It retails from approximately $40 to $125.

          HOWARD WOLF W label-started in 1993-is designed  as separates in
fashionable  larger sizes  (0x-3x) that  retails from approximately  $60 to
$250.
     The  Howard  Wolf   collections  are  sold   by  independent   sales
representatives, most  of whom  are  compensated  on  a commission  basis.
Representatives, during each fashion season, call upon retailers throughout
the country and show at the major domestic and regional fashion markets.
 
     In addition, the Company has opened two factory retail stores in
upscale factory outlet mall centers.      

Design and Production

     The Company maintains a design staff in  Dallas to design the  styles
Manufactured and sold by it. To an extent which the Company believes to be
unique for manufacturers  in  its price  range,  the Company  continuously
monitors   trends  in  style   and  fabric  with   particular  emphasis  on
developments  in  design  for career/professional  and  fashionable  women.
Design personnel of the Company make frequent trips to domestic and foreign
fashion markets. The Company operated one manufacturing facility during the
year on a  forty-hour week, one shift basis, with employment and production
virtually  constant throughout  the year.  The  Company utilized  primarily
domestic independent contractors for most  of its sewing operations,  which
are  under  the Company's  supervision  and  made  in accordance  with  its
specifications and  production schedules. Certain manufacturing operations,
pattern  making, grading  and predominantly  all cutting  continue to  be
performed by the Company's employees at its Dallas facility.

     The  Company maintains strict quality control during the manufacturing
process.  Finished products  are received  in the  Dallas facility  and are
carefully inspected and shipped from this location.

Raw Materials

     Raw materials used in the Company's products are primarily fabrics and
trim items. They are of both domestic and foreign origin and are obtainable
from many resources.

Customers

     The Company sells to approximately 800 retailers who operate more than
1,200 stores throughout  North America. No customer accounts  for more than
10 percent of sales.  Customers  include many  leading  department and 
specialty stores. Permanent showrooms are maintained in the Dallas Apparel 
Mart and the Atlanta Merchandise Mart.
<PAGE>
     In addition to  sales to retailers, the Company  operates two factory 
outlet mall stores in upscale factory outlet malls in Napa, California and
in Las Vegas, Nevada and operates its two "Fashion Showroom" factory outlet
retail stores  located in Dallas  and San Benito,  Texas for the sale of
merchandise resulting from excess production, specially produced merchandise
and seconds.

Backlog Orders

     The Company had approximately $4,300.000 of unshipped order on hand at
May 31, 1998  ($4,600.000 on May 31, 1997). These orders are believed to be
firm. All backlog orders are expected to be filled in the current fiscal 
year.

     Competition

     The  fashion apparel manufacturing industry is highly competitive, and
the  Company competes  with many  other  manufacturers, some  of which  are
larger in  sales and  resources. The principal  methods of  competition are
price and style.  Price is primarily based on fabrication,  trim and style.
Manufacturing processes employed by the Company provide competitive product
pricing.  Style is  based on  current  trends and  fashions. The  Company's
design techniques  and thorough  exploration of  fashion centers  worldwide
provide competitive styling. The Company believes that its products compete
effectively  in terms of buyer acceptance with  those of its competition in
the Company's price range and areas of style concentration. The Company has
no information to determine what share of the market its products represent
in terms of sales.

Employees

     The Company employed 102 persons on a  full-time basis at May 31, 1998.
Of these, 12 were executive, administrative and clerical employees; 13 were
sales  representatives; 64 were design, cutting and manufacturing personnel
and  13  were engaged  in  other  activities  such as  shipping,  warehouse
management,  security  and  transportation. The  Company  had  no employees
represented by a union and believes that it enjoys good relations  with its
employees.

Environmental Considerations

     The cost  and effect of complying with environmental  regulations are
not material due to the nature of the Company's business.

Item 2. Properties
<PAGE>
     The principal offices of  the Company are in  Dallas, Texas where  the
Company owns a  three-story brick building containing  approximately 90,000
square   feet.   This   facility,   containing   the   executive,   design,
administrative, and  data processing  facilities, is  also devoted to  some
manufacturing, and  all merchandise  is shipped  from this  location. These
facilities  are suitable for  the Company's operations  with adequate space
and improvements. Approximately twenty percent of the 90,000 square feet is
not presently utilized by the Company  and has been leased to an  unrelated
entity.

     The Company  owns one  other facility in  Greenville, Texas,  which is
leased  to  a  nonrelated entity  and  is  shown in  the  balance  sheet as
property, plant and  equipment not used in operations.  

     The following table  sets forth pertinent information  concerning each
of the above properties:

                                                    Interest in     Square
Location                                              property       feet
Principal office and manufacturing facility           Fee           90,000
Greenville facility                                   Fee           11,900

     The Company leases (under short-term  leases from three to five years)
permanent  showrooms  in the  apparel  marts in  Atlanta and Dallas and
retail stores in factory outlet malls in Napa, California and Las Vegas,
Nevada.

     Substantially all of the machinery, equipment, furniture and fixtures 
required in the operation of the  business is either owned  or leased by the  
Company under short term leases from thirty six months to forty eight months, 
and is in good operating condition.

Item 3. Legal Proceedings

     The Company is not involved in any material litigation.

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

     There were no matters  submitted to a vote of security  holders during
the fourth quarter of 1998.
                                  PART II
Item 5. Market  for the Registrant's Common Equity  and Related Stockholder
Matter

     The common  stock  of the  Company  is traded  on the  American  Stock
Exchange. The  following table gives the high and  low sales prices and the
amount of dividends paid for the fiscal quarters indicated:
<PAGE>
       1998           Date ended           High      Low     Dividend
   First quarter    August 31, 1997       $6 1/2    $5 3/8      .08 
   Second quarter  November 30, 1997       6 1/2     5 13/16    .08
   Third quarter   February 28, 1998       6 1/4     5 1/2      .08
   Fourth quarter     May 31, 1998         6 1/4     5 1/2      .08

       1997           Date ended           High      Low     Dividend
   First quarter    August 31, 1996       $7 5/8    $6 1/2      .08
   Second quarter  November 30, 1996       7 3/8     6 1/8      .08
   Third quarter    February 28, 1997      6 3/4     5 7/8      .08
   Fourth quarter     May 31, 1997         7         5 1/2      .08

     The Company's common stock closed at $5.375 on August 10, 1998.

     As  of  August 10, 1998, there were 247 holders  of  record  of the
Company's common stock. The Company paid dividends during fiscal years 1998
and  1997. There  are  no  restrictions on  the  Company's ability  to  pay
dividends other than those provided by statute. The payment of dividends is
reviewed each  period by the  Board of Directors taking  into consideration
earnings, business requirements and economic conditions. A dividend of $.08
per share was declared by the Board of Directors payable August 31, 1998 to
shareholders of record August 7, 1998.

Item 6. Selected Consolidated Financial Data
                                                 
                            1998      1997      1996     1995     1994      
Net sales                 $14,322   $14,242   $15,213  $14,436  $14,269   
Income before federal 
   income tax                 626     1,004     1,332    1,220    1,222     
Provision for federal
   income tax                 224       370       460      431      441       
Net income                    402       634       872      789      781       
Basic and diluted
   earnings per share         .38       .60       .83      .75      .74       
Cash dividends 
   per common share           .32       .32       .32      .30      .28       
Total assets                9,778     9,552     8,834    8,796    8,266     

Item 7. Management's Discussion and Analysis of
        Financial Conditions and Results of Operations

                            FINANCIAL CONDITION

Liquidity and Capital Resources

     Working  capital  at May  31,  1998  was  $6,810,423, an  increase  of
$96,739, or one percent from the previous year. The current ratio at  May 
31, 1998 is 4.4 to 1 (4.7 to 1 in 1997). Total liabilities to assets equals
twenty one percent (twenty percent in 1997).
<PAGE>
     Cash was used  to fund normal working  capital requirements, including
acquisition of  property,  plant and  equipment, payment  of dividends  and
payment of  matured accounts payable and accrued liabilities and the opening
of two retail stores. The cash balance at May 31, 1998 decreased $792,424, or  
approximately forty one percent from 1997.  The decrease resulted from
$304,507 used in operating activities,$149,936 used in investing activities
and $337,981 used in financing activities.

     The accounts receivable balance increased approximately five percent at 
May 31, 1998 primarily related to the timing of shipments during the fourth 
quarter.  Inventories increased approximately twenty one percent.  Six
percent of the inventories are in the two new factory outlet mall stores
and the balance of the increase resulted from the early acquisition and
production of fall merchandise.  Accounts  payable and accrued liabilities
increased approximately eleven percent  primarily due to the acquisition
of fall inventories.

     The Company factors its accounts receivable with a  commercial factor
on  a matured basis. (Funds are remitted by the factor upon maturity of the
invoices, plus a set number  of collection days). The factor establishes  a
credit line per  customer on a  non-recourse basis. Credit extended  by the
Company in  excess of the  factor's approved credit  line is factored  on a
recourse basis.

     The Company does not have a retirement plan nor offers post retirement
or employment benefits. Accordingly, there will be no impact on the Company
due to SFAS 106,"Employers'Accounting for Post Employment Benefits".

     The provisions of the Taxpayer Relief Act of 1997 are not expected to
have a material impact on liquidity, financial conditions or operations.

     The deferred tax asset at May 31, 1998 totals $234,000. Approximately
$688,000  of taxable  income will  need to  be generated in order to fully 
utilize the deferred tax.  The average taxable income of the company over the
last three years is approximately one million dollars.  In view of current 
operations  management  believes  that  adequate  taxable  income  will be 
generated in order to fully utilize the deferred tax.

     The  deductible temporary  differences related to the deferred tax 
liability of $74,000 consist of depreciation.  It is expected  that these 
differences should reverse out over the  life  of the  assets, or approxi-
mately ten years.  All other temporary differences related to the deferred
tax asset of $234,000 are expected to reverse in fiscal 1999.

     Capital  acquisition and  improvement expenditures during  fiscal 1998
totaled approximately $149,000, consisting of new equipment and improvements  
to facilities ($40,000) and furniture, fixtures and leasehold improvements
in the two factory outlet mall stores ($109,000).  These expenditures were
funded  out of current working  capital. There were  no significant
dispositions of  fixed assets used in operations during fiscal 1998 and none
are planned during fiscal 1999.  Capital acquisition and improvement
expenditures for the 1999 fiscal year are planned to  total approximately
$250,000, which will consist of new equipment to increase operating
efficiencies and  improvements to existing  facilities.  Funding will come
from  cash flows  generated through operations.  Present facilities are
adequate with room for expansion and no material requirements for additional
facilities or major capital expenditures are anticipated in the next few
years.
<PAGE>
     Shipments in  fiscal 1999 are  expected to be relatively  equal during
each quarter. Inventories are planned  to remain at approximately the same
level  during the coming year  subject to temporary  seasonal  requirements. 
The payment of  dividends is reviewed each quarter taking into consideration
liquidity, net income, business requirements and economic conditions.

     Based  on  current  operations and  internally  generated  cash flows,
management believes  that  adequate resources  will  be available  to  meet
current and future liquidity requirements.

Inflation

     Inflationary  higher prices for  materials, labor, overhead  and other
expenses increased  costs. The  Company attempts to  offset the  effects of
these increased costs through greater productivity, operating efficiencies
and selective price adjustments.

Year 2000 Disclosure

     The Company is working to resolve the potential impact of the year 2000
on the ability of the Companys computerized information systems to accurately 
process information that may be date-sensitive.  Any of the Companys programs 
that recognize a date using 00 as the year 1900 rather than the year 2000 
could result in errors or system failures.  The Company utilizes a number of 
computer programs across its entire operation.  The Company has not completed 
its assessment, but currently believes that costs of addressing this issue
will not have a material adverse impact on the Companys financial position.  
However, if the Company and third parties upon which it relies are unable to 
address this issue in a timely manner, it could result in a material financial
risk to the Company.  In order to assure that this does not occur, the Company 
plans to devote all resources required to resolve any significant year 2000 
issues in a timely manner.

<PAGE>
Recent Accounting Pronouncements

In June 1997, the Financial Accounting Standards Board (FASB) issued 
Statement of Financial Accounting Standards (SFAS) No. 130, Reporting 
Comprehensive Income, which is effective for the Companys fiscal year ending 
May 31, 1999.  SFAS No. 130 establishes standards for reporting and display of 
comprehensive income and its components (revenue, expenses, gains, and loses) 
in a full set of general purpose financial statements.  The adoption of SFAS 
No. 130, which will be implemented in the Companys fiscal year 1999, may 
result in a change in financial statement presentation but will not have an 
impact on the Companys financial position or result of operations.

In June 1997, the FASB issued SFAS no. 131, Disclosure about Segments of 
an Enterprise and Related Information, which is effective for financial 
statements for periods in fiscal years beginning after December 15, 1997,
but does not need to be applied to interim financial statements in the
initial year of its application.  SFAS No. 131 changes the way public
companies report information about segments does not presently apply to
the Companys operations.  If segment reporting becomes applicable in a
future period, the Company will adopt SFAS No. 131 in that period.


RESULTS OF OPERATIONS

1998 Compared to 1997
     Net income for  the fiscal year  ended May 31,  1998 was $401,921,  or
$.38 per share, compared to  $633,588, or $.60 per share in the 1997 fiscal
year. Income before federal income tax was $626,398 in 1998  versus income
before federal income tax of $1,004,079 in 1997.

     Net sales totaled $14,321,914 for the 1998  fiscal year, approximately
one-half of one percent over the previous year.  Sales to retail customers
were $13,834,387.  First year net sales in the factory outlet mall stores
were $487,527 and operations resulted in a loss of $233,340.   

    The HOWARD WOLF label continues to experience good customer acceptance.  
However, the Company experienced an overall soft demand for women's apparel  
which exerted great competitive pressure on sales and margins. Management's 
continuing goal is to broaden the HOWARD WOLF market base by greater 
penetration into domestic and foreign markets.

     Cost  of  sales increased .3 percent to 66.2 percent as a percentage  
relationship to net sales.  The  percentage increase resulted primarily from 
product sales mix and increased sales allowances.

     Selling, general and administrative expenses increased approximately
two percentage points as a percentage relationship  to net  sales. The
percentage increase resulted primarily from the operations of the factory 
outlet mall stores.  The provision for bad debt expense increased to $137,969 
from $127,491 in 1997. 

     Other income decreased approximately nineteen percent, primarily due
to lower rental income from property not used in operations.

     Interest income decreased approximately twenty eight percent, primarily
due to lower average cash balances.
<PAGE>
     Interest expense increased approximately eighteen percent, primarily
due to interest costs on extended terms granted on customer accounts.



                           RESULTS OF OPERATIONS

1997 Compared to 1996
     Net income for  the fiscal year  ended May 31,  1997 was $633,588, or
$.60 per share, compared to $872,048, or $.83 per share in the 1996 fiscal
year.  1996  net  income includes  $95,154 (net of tax) or $.09 per share, 
from  the  gain on  the sale of property,  plant and equipment not used in 
operations.

     Net sales for the 1997 fiscal year  were $14,242,006.  Net sales were
approximately six percent lower compared to 1996. 1997 sales reflected the
retail  fashion  apparel industry's   continued  tough  economic  climate.  
Segments of our customer base were affected by a negative foreign exchange 
rate and  an overall  weakened  consumer  demand.  Management  is  working
aggressively to overcome negative industry and economic trends by offering  
a broader product line, exploring alternative sales methods and increasing
penetration in our market base.

     Cost  of  sales decreased seven tenths of one percent as a percentage
relationship to  net sales.  The  percentage decrease  resulted primarily 
from slightly lower overhead costs and expenses.

     Selling, general  and administrative expenses increased approximately
one and  four tenths percent as  a percentage relationship  to net  sales. 
The  percentage  increase  resulted  primarily  due  to higher general and
administrative expenses.  The  provision for  bad  debt expense  increased 
to $127,491 in 1997 from $60,204 in 1996.

     Other income in fiscal 1997 increased approximately twenty percent,
primarily due to higher rental income from property, plant and equipment 
not used in operations.

     Interest income increased approximately two hundred four percent, 
primarily resulting from higher average cash balances.
<PAGE>
     Interest expense decreased approximately thirty nine percent, resulting
primarily from a reduction of extended terms on factored customer accounts.




Item 8. Consolidated Financial Statements and Supplementary Data


                 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                 Page

Report of Management                                                9

Independent Auditor's Report                                        9

Consolidated Statements of Operations and
     Retained Earnings for the years ended
     May 31, 1998, 1997 and 1996                                   10

Consolidated Balance Sheets at May 31, 1998 and 1997               11

Consolidated Statements of Cash Flows for the years
     ended May 31, 1998, 1997 and 1996                             12

Notes to Consolidated Financial Statements                      13-17

Consolidated Schedules for the years ended
     May 31, 1998, 1997 and 1996:
     II-Allowance for Collection Losses and Discounts              19

 All  other schedules  are omitted  since the required information  is not
present or  is not present in  amounts sufficient to require submission of
the  schedule  or because  the  information  required  is included  in the
consolidated financial statements and notes thereto.
<PAGE>

Report of Management
   Management is responsible for  the  consolidated  financial  statements
and all  information  in   this annual  report. The  statements have  been
prepared  in conformity with   generally accepted   accounting principles.
Financial information elsewhere in this  report is consistent with that in 
the  consolidated  financial statements.  The consolidated statements have 
been  audited by Lane Gorman Trubitt, L.L.P.,  independent auditors. Their 
role is to express an opinion as to whether management's financial  state-
ments, considered in their entirety, present fairly the Company's financial 
position, operating results and cash flows.

     Management maintains and relies  on  systems  of internal accounting
controls   designed and intended to  provide reasonable assurance that 
assets  are   safeguarded   from loss  or unauthorized use  and  that 
transactions are executed in accordance with management's authorization
and are properly recorded. These  systems  are  tested and evaluated by
management as well as by the independent auditors in connection with their
annual audit.

   The Board of Directors   selects an Audit Committee composed of two 
directors. The committee meets periodically with the independent auditors
to review the scope  and  results of the audit, principles applied in 
financial reporting,  and  financial and  operational controls.  The
independent auditors and corporate accountants have free access to the 
audit committee, who are not employees of the company. On the recommen-
dation of the Audit Committee, the Board of Directors selects and
engages the independent auditors.

/s/Eugene K. Friesen
Eugene K. Friesen
Senior Vice President and Treasurer
Chief Financial Officer
<PAGE>
Independent Auditor's Report

The Board of Directors and Shareholders
Howard B. Wolf, Inc.

  We have  audited the accompanying consolidated balance sheets of Howard
B. Wolf,  Inc. and  subsidiaries as of  May 31, 1998 and 1997,  and the 
related consolidated statements of operations and retained earnings, and 
cash flows for each of the years in the three-year period ended May 31, 
1998. These consolidated financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these 
consolidated 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 consolidated financial
statements are free of material misstatement. An audit includes examining, 
on a test basis, evidence supporting the amounts and disclosures in the 
consolidated 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 consolidated financial statements referred to
above present fairly, in all material respects,the financial position of
Howard B. Wolf, Inc. and subsidiaries as of May 31, 1998 and 1997, and the
results of their operations and their cash flows for each of the years in
the three-year period ended May 31, 1998 in conformity with generally
accepted accounting principles.

  We have also audited Schedule II of Howard B. Wolf, Inc. and subsidiaries
for the years ended May 31, 1998, 1997 and 1996. In our opinion, this
schedule presents fairly, in all material respects, the information
required to be set forth therein.

/s/ Lane Gorman and Trubitt, L.L.P.
Lane Gorman Trubitt, L.L.P., Certified Public Accountants

Dallas, Texas
July 8, 1998
<PAGE>
<TABLE>

                            HOWARD B. WOLF, INC.
         CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
                           Years ended May 31, 

                                      1998          1997          1996
<S>                               <C>           <C>           <C>
Net sales                        $14,321,914   $14,242,066   $15,213,047
                              
Cost and expenses:
  Cost of sales                    9,487,555     9,392,340    10,132,998
  Selling, general and 
    administrative expenses        4,127,553     3,820,471     3,859,302
  Provision for bad 
    debt expense                     137,969       127,491        60,204
                                  13,753,077    13,340,302    14,052,504
Income from operations               568,837       901,764     1,160,543

Gain on sale of property,plant
  and equipment not used in 
  operations                              -           -          144,172
Other income                          43,881        64,591        53,848
Interest income                       48,813        67,399        22,159
Interest expense                     (35,133)      (29,675)      (48,510)

Income before federal income tax     626,398     1,004,079     1,332,212
Provision for federal income tax    (224,477)     (370,491)     (460,164)

Net income                           401,921       633,588       872,048
Retained earnings-
  beginning of year                5,369,844     5,074,237     4,540,170
Cash dividends                      (337,981)     (337,981)     (337,981)

Retained earning-end of year      $5,433,784    $5,369,844    $5,074,237

Average number of shares 
  outstanding                      1,056,191     1,056,191     1,056,191

Basic and diluted
 earnings per share                    $.38          $.60          $.83

                           See accompanying notes
</TABLE>
<PAGE>
<TABLE>

                            HOWARD B. WOLF, INC.
                        CONSOLIDATED BALANCE SHEETS
                                  May 31,

                                   ASSETS

                                                    1998          1997
<S>                                              <C>           <C>
Current assets:
  Cash and cash equivalents                     $1,128,991    $1,921,415
  Accounts receivable-net                        2,530,137     2,415,244
  Inventories                                    4,620,568     3,815,653
  Prepaid expenses                                 159,322       160,994
  Refundable federal income tax                    112,813          -
  Deferred federal income tax                      234,000       214,000
                                                 8,785,831     8,527,306

Property, plant and equipment                    2,494,332     2,360,038
  Less accumulated depreciation
    and amortization                            (1,555,118)   (1,389,205)
                                                   939,214       970,833

Property, plant and equipment
  not used in operations                               678         2,718
Other assets                                        51,957        51,097
                                                $9,777,680    $9,551,954

                    LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
  Accounts payable and accrued liabilities      $1,975,408    $1,772,987
  Federal income tax payable                         -            40,635
    Total current liabilities                    1,975,408     1,813,622
                                              
Deferred federal income tax                         74,000        74,000

Shareholders' equity:
  Common stock,par $.33 1/3;3,000,000 shares
    authorized; 1,081,191 shares issued            360,400       360,400
  Additional paid-in capital                     2,034,088     2,034,088
  Retained earnings                              5,433,088     5,369,844
  Less common stock in treasury,
    at cost, 25,000 shares                        (100,000)     (100,000)
                                                 7,728,272     7,664,332
                                                $9,777,680    $9,551,954
                           See accompanying notes
</TABLE>
<PAGE>
<TABLE>
                             HOWARD B. WOLF, INC.
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                             Years ended May 31

                                      1998          1997          1996
<S>                                <C>           <C>           <C>
Cash flows from  
 operating activities:
   Net income                     $  401,921    $  633,588    $  872,048
   Adjustments to reconcile net   
   income to net cash provided
   by (used in) operating activities-
     Depreciation and amortization   174,605       150,067       152,625
     Provision for losses 
       on accounts receivable        137,969       127,491        60,204
     Change in deferred 
       federal income tax            (20,000)      (41,000)        2,000
   Cost on abandonment of lease        8,131           -             -
   Gain on sale of property,
       plant and equipment not
       used in operations                 -            -        (144,172)
   Net changes in operating 
     assets and liabilities-
     Accounts receivable            (252,862)     (565,937)      (67,690)
     Inventories                    (804,915)      331,633      (122,426)
     Prepaid expenses                  1,671          (626)      (53,737)
     Refundable federal income tax  (112,813)          -             - 
     Accounts payable and
       accrued liabilities           202,421       350,163      (420,924)
     Federal income tax payable      (40,635)       76,573       (61,594)
     Net cash provided by (used in)
         operating activities       (304,507)    1,061,952       216,334

Cash flows from investing activities:
   Other assets                         (860)       (1,432)         (830)
   Additions to property,
     plant and equipment            (149,076)      (63,111)     (241,105)
   Sale of property, plant
     and equipment not used
     in operations                         -           -         250,000
     Net cash (used in) provided 
         by investing activities    (149,936)      (64,543)        8,065

Cash flows from
 financing activities:
   Cash dividends paid              (337,981)     (337,981)     (337,981)
     Net cash used by
       financing activities         (337,981)     (337,981)     (337,981)

Net increase(decrease) in cash 
  and cash equivalents              (792,424)      659,428      (113,582)
Cash and cash equivalents
  at beginning of year              1,921,415    1,261,987     1,375,569

Cash and cash equivalents
  at end of year                   $1,128,991    $1,921,415    $1,261,987

                          See accompanying notes
</TABLE>                    
<PAGE>
                            HOWARD B. WOLF, INC.
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Business
     The Company designs, manufactures and sells women's fashion apparel.
It's  principal market  is retail  clothing  and department  stores in  the
United States.

Summary of significant accounting policies

     The  consolidated financial  statements include  the  accounts of  the
Company and all subsidiaries. All significant intercompany transactions and
balances have been eliminated in consolidation.

     Raw materials are priced at the lower of cost (identified  unit basis)
or market and work-in-process and finished goods are priced at the lower of
average cost or market.

     Property, plant  and equipment  is stated  at  cost. Depreciation  and
amortization of  machinery and  equipment, leasehold  improvements and  the
building  included in  property, plant  and equipment  are provided  by the
straight-line method. Depreciation  of the buildings included  in property,
plant and  equipment not  used in operations  is provided  for by  both the
accelerated and straight-line methods.

     Income  taxes are  provided on  pre-tax  earnings as  reported in  the
consolidated  financial  statements.  Deferred  income  taxes  result  from
temporary differences between pre-tax earnings reported in the consolidated
financial statements and taxable income.

     The Company has adopted Statement of Financial Accounting Standards No. 
128 (SFAS No, 128), Earnings per Share.  SFAS No. 128 established new 
requirements for computing and presenting earnings per share.  Under the new 
requirements, the method previously used to compute earnings per share is 
changed and all prior periods presented have been restated to conform to the 
new requirements.  The new requirements eliminate primary and fully diluted 
earnings per share.  As a result, under the new requirements, basic and 
dilutive net earnings per share are the same under the Companys capital 
structure.

	Basic and diluted earnings per share is computed on the weighted
average number of common shares outstanding during the period.

	In June 1997, the FASB released Statement of Financial Accounting 
Standards No. 128 (SFAS No. 128), Earnings per Share.   SFAS No. 128
establishes standards for the reporting and display of comprehensive income
and its components in a full set of general-purpose financial statements and
is effective for the Companys fiscal year 1999.  The Company believes that 
adoption of SFAS 130 will not have a material impact on the Companys 
consolidated financial statements.
<PAGE>         
     In  preparing  the  Company's  financial  statements,   management  is
required to make estimates and assumptions that effect the reported amounts
of  assets  and  liabilities,  the  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 form these estimates.

     Fair value of  financial instruments are estimated  to approximate the
related   book  values,  unless   otherwise  indicated,  based   on  market
information available to the Company.

Cash flow information

     The  consolidated statement of  cash flows provides  information about
changes in  cash and cash  equivalents. Cash equivalents consist  of highly
liquid debt instruments with a maturity, when purchased, of three months or
less.

     Cash payments  for interest  were:  1998-$35,133; 1997-$29,675;  1996-
$48,108.  Cash payments for federal income taxes were: 1998-$387,925; 1997-
$341,854; 1996-$519,758.

Cash and cash equivalents

     Cash and cash equivalents consist of:
                                                    1998          1997
               Cash                             $  290,833    $  945,759
               Money market funds                  207,461       400,162
               Matured funds at factor             630,697       575,494
                                                $1,128,991    $1,921,415
Credit risk

     The  Company and  its subsidiaries  maintain cash balances  at several
financial institutions located  in Texas. Accounts in  each institution are
insured  by  the  Federal Deposit  Insurance  Corporation  up to  $100.000.
Uninsured  balances aggregate to approximately $855,000  at May  31, 1998,
($1,454,000 at May 31,  1997).The  Company  has not experienced any losses in
such accounts  and believes  it is  not exposed  to any  significant credit
risk.

     The balance of  accounts receivable factored and matured  funds with a
commercial  factor  of  approximately  $2,172,000  at  May  31,  1998  are
uninsured ($2,538,000 at May 31, 1997).

Accounts receivable

     Accounts receivable are  net of allowances  for collection losses  and
discounts of $132,546 in 1998 and $131,931 in 1997.
<PAGE>
                            HOWARD B. WOLF, INC.
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

     At  May  31,  1998  and 1997  approximately  $1,542,000 and $1,962,000
respectively,  of accounts  receivable  were  factored  with  a  commercial
factor. Approximately $707,000 and $1,133,000 were factored with recourse at
May 31, 1998 and 1997, respectively.

Inventories

     Inventories consist of:                       1998          1997

               Raw materials                    $  991,748    $1,237,574
               Work-in-process                   1,067,345     1,043,457 
               Finished goods                    2,561,475     1,534,622
                                                $4,620,568    $3,815,653

Property, plant and equipment

     Details  of property,  plant and  equipment at cost and the  estimated 
useful lives used in computing depreciation and amortization are:
                                   Estimated 
                                  useful lives      1998          1997
          Property, plant and
            equipment: 
            Land                           -    $  109,846    $  109,846
            Buildings               25 years       661,727       661,727
            Machinery and 
              equipment           3-10 years     1,027,109       921,182
            Building and lease-
             hold improvements    4-10 years       695,650       667,283
                                                $2,494,332    $2,360,038
 
            Plant and equipment 
              not used in operations:
                Buildings           25 years       137,005       137,005
                                                   					
            Less accumulated depreciation         (136,327)     (131,195)
                                                $      678     $   5,810  
<PAGE>
Accounts payable and accrued liabilities

     Accounts payable and accrued 
       liabilities consist of:
                                                    1998          1997
          Accounts payable-trade                $1,667,482    $1,241,286
          Accrued compensation                     191,390       410,148
          Accrued taxes                            100,207        76,795
          Other accrued liabilities                 16,329        44,758

                                                $1,975,408    $1,772,987

       
                          HOWARD B. WOLF, INC.
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

Line of credit

     The Company has an oral agreement for a line of credit with  a bank in
the amount of $100,000 bearing  no interest. The line is collateralized  by
the general assets  of the company. As  of May 31, 1998,  amounts available
under this  line were $100,000. No  amounts were drawn under this line of 
credit as of May 31, 1998.

Leases

     Certain equipment, manufacturing facilities, showrooms and factory outlet 
mall stores are leased for periods  expiring at  various dates through  fiscal 
2003,  at aggregate annual  rentals of  approximately  $159,000  in 1998, 
$103,000  in 1997 and $99,000 in 1996,  which consisted  entirely  of minimum
rentals. In  most cases, management expects that in the normal course of 
business leases will be renewed or replaced by other leases.

     The future minimum lease payments required under operating leases that
have an  initial or remaining lease term  in excess of one year  at May 31,
1998 were as follows:
                                                   Operating               
                                                     leases
               1999                                $171,030
               2000                                 159,477
               2001                                 148,023
               2002                                 104,347
               2003                                  63,544

                                                   $646,421

Shareholders' Equity

     On July 22, 1998 the  Board of  Directors declared  a quarterly  cash
dividend of $.08 per share payable August 31, 1998 to shareholders of record
on August 7, 1998.
<PAGE>
Federal Income Tax

     The detail of the provision for federal income tax follows:
                                         For the years ended May 31,
                                      1998          1997          1996
         Current tax expense       $244,477      $411,491      $458,194
         Deferred tax
           (benefit) expense         20,000       (41,000)        2,000
         Provision for income tax  $224,477      $370,491      $460,194

     There are  two components of the income tax provision,   current  and
deferred.  Current income tax provisions approximate taxes to be  paid  or 
refunded for the  applicable  period.  Balance  sheet  amounts of deferred
taxes are recognized  on the temporary  differences  between  the bases of 
assets and liabilities as measured by tax laws and their bases as reported 
in the financial  statements.  The  measurement of deferred  tax assets is
reduced,  if necessary, by the amount of  any tax benefits that,  based on 
available evidence, are not expected to be realized.  Deferred tax expense
or benefit  is  then recognized for the change in deferred tax liabilities
or assets between periods.


                            HOWARD B. WOLF, INC.
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)


     Total deferred tax assets and liabilities in the consolidated balance
sheets are as follows at May 31,:

               Assets                 1998          1997          1996  
         Bad debt reserve          $ 40,000      $ 40,000      $ 26,000
         Discount  reserve            5,000         5,000         3,000   
         Inventory capitalization
           of selling, general and
           administrative costs     189,000       169,000       148,000
                                   $234,000      $214,000      $177,000
              Liabilities
         Depreciation              $ 74,000      $ 74,000      $ 78,000
<PAGE>
     The income  tax provision  reconciled to the  tax computed  at federal
statutory rates is as follows:
                                        For the years ended May 31,
                                      1998          1997          1996
         Tax at statutory rates    $212,975      $341,387      $452,951
         Tax effect on non-
           deductible items          14,620        13,472        11,906
         Other-net                   16,882        56,632        (6,663)
                                   $244,477      $411,491      $458,194
       
         Deferred tax
           (benefit) expense        (20,000)      (41,000)        2,000
                                   $224,477      $370,491      $460,194
                                                       
  The components of deferred income tax (benefit) expense are as follows:
                                         For the years ended May 31,
                                      1998          1997          1996
         Difference between tax
           and book depreciation   $    282      $ (3,400)     $ (4,080)
         Difference between tax
           and book allowance for
              doubtful accounts        (810)      (13,430)        3,876
         Difference between tax 
           and book basis of
           merchandise inventories  (20,072)      (21,809)        1,890
         Reserve for discounts          600        (2,361)          314
             Deferred tax              
               (benefit) expense   $(20,000)     $(41,000)     $  2,000

       
                            
Advertising costs                            

     The Companys  policy  is to  expense  all advertising costs in the 
period in which the advertising  first  takes place.  Advertising expense 
was approximately $208,000, $122,000 and $155,000 for the years ended May
31, 1998, 1997 and 1996, respectively.
<PAGE>
<TABLE>
                            HOWARD B. WOLF, INC.
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

Selected quarterly financial data (UNAUDITED)
             First Quarter  Second Quarter  Third Quarter  Fourth Quarter
                   Ended           Ended           Ended           Ended
                Aug 31,1997     Nov 30,1997     Feb 28,1998     May 31,1998
 <S>             <C>             <C>             <C>             <C>
Net sales      $3,680,093       $3,861,720      $3,276,419      $3,503,682
Gross profit    1,299,050        1,460,640       1,028,199       1,046,470
Income before
  federal
  income tax      265,460          259,988          80,217          20,733
Net income        170,196          168,996          43,682          19,047
Basic and diluted
 earnings per share  .16              .16             .04             .02
Average number
  of shares
  outstanding   1,056,191        1,056,191       1,056,191       1,056,191
 
               Aug 31,1996     Nov 30,1996     Feb 28,1997     May 31,1997

Net sales      $3,630,878       $3,640,522      $3,421,547      $3,549,119
Gross profit    1,218,155        1,348,966       1,183,709       1,098,896
Income before
  federal
  income tax      259,050          269,783         251,229         224,017
Net income        166,714          166,238         158,438         142,198
Basic and diluted
  earnings per share  .16              .16             .15             .13
Average number
  of shares
  outstanding   1,056,191        1,056,191       1,056,191       1,056,191


</TABLE>
<PAGE>

Item 9. Changes in and disagreements with accountants
        on accounting and financial disclosure matters

        None
                                  PART III

     The information required  by items 10,  11, 12 and  13 of Part III  is
incorporated  by  reference  from  the indicated  pages  in  the  Company's
definitive proxy  statement for  its annual meeting  of shareholders  to be
held September 15, 1998.
                                                          Pages of Proxy   
                                                             Statement

Item 10. Directors and Executive
           Officers of the Registrant                           3-4    
Item 11. Executive Compensation                                   5 
Item 12. Executive Ownership of Certain                           
           Beneficial Owners and Management                     2-3    
Item 15. Certain Relationships and Related Transactions           7 

                                  PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
     (a) 1. Financial statements and financial statement schedules
         The financial statements and schedules listed in the accompanying 
           index to consolidated financial statements are filed as part of
           this annual report.
         3. Exhibits
         None
     (b) Report on Form 8-K
         No reports were filed in the fourth quarter ended May 31, 1998.
<PAGE>
<TABLE>

                          HOWARD B. WOLF, INC.
         SCHEDULE II-ALLOWANCE FOR COLLECTION LOSSES AND DISCOUNTS
                  Years ended May 31, 1998, 1997 and 1996
                             000's Omitted

                      Balance at   Additions   Amount               Balance 
                      beginning    charged    charged   Discounts   at end 
                        of year    to income    off(2)   allowed    of year
<S>                   <C>          <C>          <C>      <C>        <C>
Year ended
  May 31,1998                                                             
Collection losses     $116         $  138       $136     $    -     $ 119
Discounts               16            857(1)       1        857        14
                      $132         $  995       $137     $  857     $ 133
Year ended                                                                 
  May 31, 1997                                                             
Collection losses     $ 77         $  127       $ 88     $    -     $ 116
Discounts                9          1,048(1)      (7)     1,048        16
                      $ 86         $1,175       $ 81     $1,048      $ 13 
                    
Year ended                                                                 
  May 31, 1996                                                             
Collection losses     $ 88         $   60       $ 72     $    -     $  77
Discounts               10          1,027(1)       1      1,027         9
                      $ 99         $1,087       $ 73     $1,027     $  86


(1) Charged to net sales.
(2) Net of recoveries.
</TABLE>
<PAGE>

                                 SIGNATURES

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

Howard B. Wolf, Inc.

By:/s/ Robert D. Wolf
Robert D. Wolf
President
(Chief Executive Officer)
August 25,1998

By:/s/ Eugene K. Friesen
Eugene K. Friesen
Senior Vice President and Treasurer
(Principal Accounting Officer)
August 25,1998

Pursuant of 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 and on the dates indicated:


/s/Creed L. Ford III
Creed L. Ford III
Director
August 25,1998

/s/Eugene K. Friesen
Eugene K. Friesen
Senior Vice President,Treasurer and Director
August 25,1998

/s/Joel Held
Joel Held
Director
August 25,1998

/s/Juan Villamizar
Juan Villamizar
Director
August 25,1998

/s/Howard B. Wolf
Howard B. Wolf
Chairman of the Board,Secretary and Director
August 25,1998

/s/Robert D. Wolf
Robert D. Wolf
President, Chief Executive Officer and Director
August 25,1998