SECURITIES AND EXCHANGE COMMISSION
                       WASHINGTON, D. C.  20549

                                Form 10-K
                               (Mark One)
   
   ( X )    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (D) OF
            THE SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)
            For the Fiscal Year Ended July 31, 1998
OR
   (   )    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF
            THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
            For the transition period from          to

                      Commission File No. 0-8190

                   Williams Industries, Incorporated
        (Exact name of Registrant as specified in its charter)

                   Virginia                   54-0899518
       (State or other jurisdiction of      (I.R.S. Employer
        incorporation or organization)     Identification No.)

               2849 Meadow View Road
               Falls Church, Virginia                22042
       (Address of principal executive offices)   (Zip Code)

         Registrant's telephone number, including area code:
                           (703) 560-5196

Securities registered pursuant to Section 12(b) of the Act:  None
Securities registered pursuant to Section 12 (g) of the Act:
                     Common Stock, $0.10 Par Value
                           (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 
pursuant to Rule 405 of Regulation S-K is not contained herein, 
and will not be contained, to the best of Registrant's knowledge, 
in definitive proxy or information statements incorporated by 
reference in Part III of this Form 10-K or any amendment to this 
Form 10-K.   (X)

     Aggregate market value of voting stock held by non-affiliates 
of the Registrant, based on last sale price as reported on 
September 30, 1998:
                                                $11,623,394

     Shares outstanding at September 30, 1998     3,576,429

     The following document is incorporated herein by reference 
thereto in response to the information required by Part III of 
this report (information about officers and directors):

     Proxy Statement Relating to Annual Meeting to be held 
November 14, 1998.


PART 1

Safe Harbor for Forward Looking Statements

     The Company is including the following cautionary statements 
to make applicable and take advantage of the safe harbor 
provisions within the meaning of Section 27A of the Securities Act 
of 1933 and Section 21E of the Securities Exchange Act of 1934 for 
any forward-looking statements made by, or on behalf of, the 
Company in this document and any materials incorporated herein by 
reference.  Forward-looking statements include statements 
concerning plans, objectives, goals, strategies, future events or 
performance and underlying assumptions and other statements which 
are other than statements of historical facts.  Such forward-
looking statements may be identified, without limitation, by the 
use of the words "anticipates," "estimates," "expects," "intends," 
and similar expressions.  From time to time, the Company or one of 
its subsidiaries individually may publish or otherwise make 
available forward-looking statements of this nature.  All such 
forward-looking statements, whether written or oral, and whether 
made by or on behalf of the Company or its subsidiaries, are 
expressly qualified by these cautionary statements and any other 
cautionary statements which may accompany the forward-looking 
statements.  In addition, the Company disclaims any obligation to 
update any forward-looking statements to reflect events or 
circumstances after the date hereof.

     Forward-looking statements made by the Company are subject to 
risks and uncertainties that could cause actual results or events 
to differ materially from those expressed in, or implied by, the 
forward-looking statements.  These forward-looking statements may 
include, among others, statements concerning the Company's revenue 
and cost trends, cost-reduction strategies and anticipated 
outcomes, planned capital expenditures, financing needs and 
availability of such financing, and the outlook for future 
construction activity in the Company's market areas.  Investors or 
other users of the forward-looking statements are cautioned that 
such statements are not a guarantee of future performance by the 
Company and that such forward-looking statements are subject to 
risks and uncertainties that could cause actual results to differ 
materially from those expressed in, or implied by, such 
statements.  Some, but not all of the risk and uncertainties, in 
addition to those specifically set forth above, include general 
economic and weather conditions, market prices, environmental and 
safety laws and policies, federal and state regulatory and 
legislative actions, tax rates and policies, rates of interest and 
changes in accounting principles or the application of such 
principles to the Company.


Item 1. Business

     Williams Industries, Incorporated operates in the commercial, 
industrial, institutional, governmental and infrastructure 
construction markets in the Mid-Atlantic region.  The Company's 
main lines of business include:  steel, precast concrete and 
miscellaneous metals erection and installation; crane rental, 
heavy and specialized hauling and rigging; fabrication of welded 
steel plate girders, rolled steel beams, and light structural and 
other metal products; and the sale of insurance, safety and 
related services.  In the coming years, the Company intends to 
expand its business by taking advantage of opportunities to 
increase its market share in existing geographic areas of business 
and to further expand its geographic service areas in these core 
lines of business.   This approach is designed to facilitate the 
Company's mission, "To be the premier provider of services to the 
construction industry in the Eastern United States."

A.  General Development of Business

     In 1970, Williams Industries, Incorporated was formed as a 
Virginia corporation to act as the parent of two previously 
established sister companies specializing in steel erection and 
the rental of construction equipment.

     Through the 1980s, the Company grew through the addition of 
subsidiaries and affiliates operating in a wide range of 
industrial, commercial, institutional and government construction 
markets.  By the mid-1980s, Williams Industries, Inc. had grown 
from the original steel erection company to a conglomerate with 27 
subsidiaries and affiliates.  By the late 1980's, the Company was 
producing more than $100 million in revenue annually.

     However, debt, in excess of $33 million, accompanied the 
expansion and, when construction activity virtually ceased in the 
Company's market areas in the early 1990s, restructuring for 
survival became necessary.   Williams Industries, Inc. is now a 
much smaller corporation than the conglomerate of a few years ago.  
Since 1993, the Company has worked to achieve its goals of debt 
repayment and consistent profitability of core operations.

     Construction Insurance Agency, Inc., Greenway Corporation, 
Piedmont Metal Products, Inc., Williams Bridge Company, Williams 
Equipment Corporation, and Williams Steel Erection Company, Inc. 
now represent the corporation's business focus for the foreseeable 
future and, from an aggregate operating perspective, are working 
to enhance the on-going value of Williams Industries, Inc. and to 
establish a sound base for future growth.

     Their efforts are augmented by the parent holding company, 
Williams Industries, Inc., and by the operating entities of 
Insurance Risk Management Group, Inc., and WII Realty Management, 
Inc. (WIIRM).  Each of these companies, including the parent, 
provide necessary services for their sister subsidiaries in the 
corporation.   WIIRM manages the Company's real estate, including 
the leasing of property to unaffiliated tenants.   The parent also 
sponsors the Company's Section 401(k) and Section 125 plans for 
employees.

     In order to achieve the profitable, restructured corporation 
that exists today,  management, working within the Company's 
comprehensive long-range plan, took a number of necessary steps to 
return the Company to operational profitability.  These measures 
included the removal of Bank Group debt; the reduction of 
operating, and general and administrative costs;  expansion of 
market areas within the core businesses; and further consolidation 
and reorganization of corporate components as necessary.

     Final Bank Group Debt Restructuring occurred on March 31, 
1997, when the Company reached an agreement with The CIT 
Group/Credit Finance Inc. (CIT) for the funds necessary to repay 
the outstanding balance of the Bank Group loan.  In connection 
with the repayment, convertible debentures were issued to 
NationsBank and the FDIC.   On February 5, 1998, NationsBank 
converted their debenture into 620,766 shares of the Company's 
stock, making them the Company's largest single shareholder.   The 
FDIC debenture, along with another debenture issued to the FDIC
for other reasons, were redeemed for $165,000 during the quarter 
ended April 30, 1998.  The redemption of the FDIC debentures 
eliminated a commitment to issue 246,560 shares of the Company's 
stock.

     Previously, in the year ended July 31, 1997, the Company  
issued 215,000 shares of stock to resolve a long-standing legal 
issue with the estate of Mr. Eugene Pribyla.  Approximately 70,000 
shares were issued to First Tennessee Equipment Finance 
Corporation upon conversion of a debenture issued to resolve debt 
relating to a former subsidiary.  The Company had previously 
accrued a contingency reserve for this matter and the issuance was 
recorded at the market value of the Company's stock and reduced 
the related liability.   

     After these transactions, Williams Industries, as of July 31, 
1998, had 3,576,429 shares of stock outstanding.   The composition 
of the shareholder base has changed significantly from the 
investor base that existed when the Company began its 
restructuring.   In relation to stock activity, the Company moved 
from the "over the counter" (OTC) or "pink sheet" market to the 
Nasdaq National Market System on March 5, 1998.   The relisting on 
Nasdaq was one of management's goals which was accomplished in the 
year ended July 31, 1998.


B.  Financial Information About Industry Segments

     The Company's activities are divided into three broad 
categories: (1) Construction, which includes industrial, 
commercial and governmental construction, the construction, repair 
and rehabilitation of bridges as well as the rental, sale and 
service of heavy construction equipment; (2) Manufacturing, which 
includes the manufacture of metal products; and (3) Other, which 
includes insurance agency operations and parent company 
transactions with unaffiliated parties.  Financial information 
about these segments is contained in Note 13 of the Notes to 
Consolidated Financial Statements.  The following table sets forth 
the percentage of total revenue attributable to these categories 
for the years ended July 31, 1998, 1997 and 1996:
<TABLE>
<CAPTION>
                                  Fiscal Year Ended July 31,
                                  --------------------------
                                   1998       1997     1996 
                                   ----       ----     ----
     <S>                           <C>        <C>      <C>
     Construction . . . . . . . . . 62%        65%      59%
     Manufacturing. . . . . . . . . 35%        32%      37%
     Other. . . . . . . . . . . . .  3%         3%       4%
</TABLE>
     This mix has changed over the years as the Company continues 
to organize its business into a more profitable configuration. 
While levels of operating activity in the construction and 
manufacturing segments are likely to be maintained for some time 
going forward, the percentages of total revenue are expected to 
change as market conditions or new business opportunities warrant. 


C. Narrative Description of Business

1. Construction

     The Company specializes in structural steel erection, the 
installation of architectural, ornamental and miscellaneous metal 
products, the installation of precast and prestressed concrete 
products, the rental and sale of construction equipment and the 
rigging and installation of equipment for utility and industrial 
facilities.

     The Company owns or leases a wide variety of construction 
equipment and has experienced little difficulty in obtaining 
sufficient equipment to perform its contracts.

     Most labor employed by this segment is obtained in the areas 
where the particular project is located.  Labor in the 
construction segment is primarily open shop.  Due to recent 
increases in the overall construction marketplace, there were 
occasions in the past fiscal year when the Company experienced 
some difficulty in finding sufficient, qualified personnel to meet 
all commitments without resorting to extensive overtime with 
existing personnel.   State approved training and apprenticeship 
programs are continuing in an effort to abate and resolve this 
concern on a long-range basis.

     In its construction segment, the Company requires few raw 
materials, such as steel or concrete, since these are generally 
furnished by and are the responsibility of the firm that hires the
Company to provide the construction services. 

     The primary basis on which the Company is awarded 
construction contracts is price, since most projects are awarded 
on the basis of competitive bidding.  While there are numerous 
competitors for commercial and industrial construction in the 
Company's geographic areas, the Company remains as one of the 
larger and more diversified companies in its areas of operations.

     Although revenue derived from any particular customer has 
fluctuated significantly, in recent years no single customer 
normally accounts for more than 10% of consolidated revenue.
However, for the year ended July 31, 1998, one customer accounted 
for 10.4% of consolidated revenue and 13.4% of construction 
revenue.

     A significant portion of the Company's work is subject to 
termination for convenience clauses in favor of the local, state, 
or federal government entities who contracted for the work in 
which the Company is involved.  The law generally gives local, 
state, and federal government entities the right to terminate 
contracts, for a variety of reasons, and such rights are made 
applicable to government purchasing by operation of law.  While 
the Company rarely contracts directly with such government 
entities, such termination for convenience clauses are 
incorporated in the Company's contracts by "flow down" clauses 
whereby the Company stands in the shoes of its customers.  The 
Company has not experienced any such terminations in recent years, 
and because the Company is not dependent upon any one customer or 
project, management feels that any risk associated with performing 
work for governmental entities is minimal.


a. Steel Construction

     The Company engages in the installation of structural and 
other steel products for a variety of buildings, bridges, 
highways, industrial facilities, power generating plants and other 
structures.

     Most of the Company's steel construction revenue is received 
on projects where the Company is a subcontractor to a material 
supplier (generally a steel fabricator) or another contractor.  
When the Company acts as the steel erection subcontractor, it is 
invited to bid by the firm that needs the steel construction 
services. Consequently, customer relations are important.  From 
year to year, a particular customer and/or contract may comprise a 
significant portion of the steel construction revenues.

     The Company operates its steel erection business primarily in 
the Mid-Atlantic area between Baltimore, Maryland and Norfolk, 
Virginia.

b. Concrete Construction

     The Company erects structural precast and prestressed 
concrete for various structures, such as multi-storied parking 
facilities and processing facilities, and erects the concrete 
architectural facades for buildings.  The concrete erection  
business is not dependent upon any particular customer.

c. Rigging and Installation of Equipment

     Much of the equipment and machinery used by utilities and 
other industrial concerns is so cumbersome that its installation 
and preparation for use, and to some extent its maintenance, 
requires installation equipment and skills not economically 
feasible for those users to acquire and maintain.  The Company's 
construction equipment, personnel and experience are well suited 
for such tasks, and the Company contracts for and performs those 
services.  Since management believes that the demand for these 
services, particularly by utilities, is relatively stable 
throughout business cycles, it is aggressively pursuing the 
expansion of this phase of its construction services.  

d.  Equipment Rental and Sales

     The Company requires a wide range of heavy construction 
equipment in its construction business, but not all of the 
equipment is in use at all times.  To maximize its return on 
investment in equipment, the Company rents equipment to 
unaffiliated parties to the extent possible.  Operating margins 
from rentals are attractive because the direct cost of renting is 
relatively low.   As a result, the Company is aggressively 
pursuing the expansion of this phase of its business.

     The Company's construction and equipment rental companies 
maintain an extensive fleet of heavy equipment, including cranes,
tractors and trailers.  Because of the Company's maintenance 
efforts, management believes the equipment is in good condition 
and is well maintained.  Construction equipment which is 
maintained diligently does not tend to depreciate physically in 
ordinary use.  Therefore the Company's older equipment, 
particularly cranes, are generally worth more than their carrying 
value.  Nevertheless, older cranes tend to be less efficient, 
because of operational and maintenance issues, as well as the 
safety advances and general "user friendliness" incorporated into 
newer cranes.  For these reasons, management is constantly 
reviewing the equipment to phase out older models in favor of 
current designs, and therefore the sale of older cranes is an 
important part of the Company's business.  In addition, the fleet
upgrade cycle can assist the Company in moderating the seasonal
fluctuations in construction revenues.


2. Manufacturing

     Products fabricated include steel plate girders used in the 
construction of bridges and other projects, and light structural 
metal products.  In its manufacturing segment, the Company obtains 
raw materials from a variety of sources on a competitive basis and 
is not dependent on any one source of supply.  During the year 
ended July 31, 1998, the Company's sole supplier of domestically 
produced large structural shapes put all of its customers on 
short-term allocation or rationing of product.  Due to 
requirements to use domestic steel in federal projects, this 
rationing produced temporary supply difficulties.   This created 
difficulties in product delivery schedules to customers as well as 
the deferral of revenue.

     Facilities in this segment are open shop.  Management 
believes that its employee relations in this segment are good.

     Competition in this segment, based on price, quality and 
service, is intense.  Although revenue derived from any particular
customer of this segment fluctuates significantly, in recent years
no single customer has accounted for more than 10% of consolidated
revenue.

a. Steel Manufacturing

     The Company has two plants for the fabrication of steel plate 
girders, rolled beams, and other components used in the 
construction, repair and rehabilitation of highway bridges and 
grade separations. 

     One of these plants, located in Manassas, Virginia, is a 
large heavy plate girder fabrication facility and contains a main 
fabrication shop, ancillary shops and offices totaling 
approximately 46,000 square feet, together with rail siding.

     The other plant, located on 17 acres in Richmond, Virginia, 
is a full service fabrication facility and contains a main 
fabrication shop, ancillary shops and offices totaling 
approximately 128,000 square feet.

     Both facilities have internal and external handling 
equipment, modern fabrication equipment, large storage and 
assembly areas and are American Institute of Steel Construction, 
Category III, Fracture Critical bridge shops.

     All facilities are in good repair and designed for the uses 
to which they are applied. Since virtually all production at these 
facilities is for specific contracts rather than for inventory or 
general sales, utilization can vary from time to time.

b.  Light Structural Metal Products

      The Company fabricates light structural metal products at a 
Company-owned facility on ten acres located in Bedford, Virginia.  
For the past three fiscal years, there have been major 
improvements and expansion to the facilities to enhance 
manufacturing capabilities, as well as the ability to finish 
product in inclement weather.


3. General and Insurance

a. General

     All segments of the Company are influenced by adverse weather 
conditions.  Accordingly, higher revenue typically is recorded in 
the first (August through October) and fourth (May through July) 
fiscal quarters when the weather conditions are generally more 
favorable.  This variation is more pronounced in the construction 
segment than in the manufacturing segment.

     Management is not aware of any environmental regulations that 
materially impact the Company's capital expenditures, earnings or 
competitive position.  Compliance with Occupational Safety and 
Health Administration (OSHA) requirements may, on occasion, 
increase short-term costs (although in the long-term, compliance 
may actually reduce costs through workers' compensation savings); 
however, since compliance is required industry wide, the Company 
is not at a competitive disadvantage, and the costs are built into 
the Company's normal bidding procedures.

     The Company employs between 175 and 400 employees, many 
employed on an hourly basis for specific projects, the actual 
number varying with the seasons and timing of contracts.  At July 
31, 1998, the Company had 353 employees, of which approximately 15 
were covered by a collective bargaining agreement.   Generally, 
management believes that its employee relations are good.

b. Insurance

Liability Coverage

     Primary liability coverage for the Company and its 
subsidiaries is provided by a policy of insurance with limits of 
$1,000,000 and a $2,000,000 aggregate.  The Company also carries 
what is known as an "umbrella" policy which provides limits of 
$5,000,000 excess of the primary.  The primary policy has a 
$10,000 deductible; however, it does provide first dollar defense 
coverage.  If additional coverage is required on a specific 
project, the Company makes those purchases.       

Workers' Compensation Coverage

      The Company presently maintains a "loss sensitive" workers' 
compensation insurance program which has been administered by the 
same insurance company since December 1992.  The terms of the 
program are negotiated by the Company and the insurance carrier on 
a year-to-year basis.  The terms may provide for a wide variety of 
measures to manage or limit the risk of the program.  The 
structure of the Company's program stresses the minimization of  
risk.  The Company accrues workers' compensation insurance expense 
based on estimates of its exposure under the program.  The 
program's success has reduced insurance expense below the accrued 
amount for the past several years.  Traditional insurance coverage 
or monopolistic state programs are required in certain states, but 
these states are no longer a significant part of the Company's 
market area.
 
     While the loss sensitive program described above has been and 
is expected to be a significant factor in limiting the cost of 
insurance, a small component of the cost is based on the Company's 
"loss modification factor."   This factor is a percentage increase 
or decrease to a standard premium based primarily on the Company's 
previous claims experience, which is promulgated by a national 
rating body.  Since 1986,  the Company's loss modification factor 
ranged from a high of 1.73 in 1986 to a low of 0.92 in 1992.  The 
current loss modification factor is 1.07.  The Company's current 
five year business plan sets a goal of reducing the factor to 
0.80. Management feels it can meet this aggressive goal by:  the 
continued emphasis on safety and loss control measures; education 
of management and employees on the importance of the corporate 
safety program;   monitoring of claims to reduce costs; and 
maintaining effective rehabilitation programs for injured 
employees.

     The Company strives to be in the forefront in providing a 
safe work place for its workers, but, because of the dangerous 
nature of its business, injuries do occur.  In those cases, the 
Company recognizes the personal trauma that can accompany those 
injuries and attempts to provide comfort and individual 
consideration to the injured party and his or her family.


4. Backlog Disclosure

     As of July 31, 1998, the Company's backlog was approximately 
$21.7 million, as compared to $12.5 million as of July 31, 1997.


Item 2. Properties 

     At July 31, 1998, the Company owned approximately 88 acres of 
industrial property.   Approximately 39 acres are near Manassas, 
in Prince William County, Virginia; 17 acres are in Richmond, 
Virginia; and 32 acres in Bedford, in Virginia's Piedmont section 
between Lynchburg and Roanoke.
          
     In the year ended July 31, 1998, the Company sold its 2.25 
acre headquarters property in Fairfax Country, Virginia for 
$1,430,000 to a nonaffiliated third party.  The Company is leasing 
back several buildings on the property.  The transaction resulted 
in a gain of approximately $560,000, of which $254,000 is included 
in "Other Income" (See Note 11 to the Consolidated Financial 
Statements).  There will be appreciable cash flow benefits going 
forward because the cost of leasing the needed space on the 
property is lower than the carrying cost of the debt on the 
property.  The Company also sold its one acre property in 
Baltimore, Maryland for $135,000 to a non-affiliated third party.


Item 3. Legal Proceedings

Precision Components Corp.

     The Company received a favorable decision in this case, and 
judgment in favor of the Company was entered on March 4, 1998 by 
the Circuit Court for the City of Richmond.   The suit by 
Industrial Alloy Fabricators, Inc. and Precision Components Corp. 
against Williams Industries, Inc. and IAF Transfer Corporation, 
sought $300,000 plus interest and fees arising from a product 
liability claim against the Company.  The plaintiffs have 
perfected an appeal to the Virginia Supreme Court, which the Court 
accepted on September 21, 1998.   It is expected the case will be 
argued early in 1999.  Management believes that the ultimate 
outcome of this matter will not have a material adverse impact on 
the Company's financial position, results of operations or cash 
flows.

General

     The Company is also party to various other claims arising in 
the ordinary course of its business.  Generally, claims exposure 
in the construction services industry consists of employment 
claims of various types of workers compensation, personal injury, 
products' liability and property damage.  The Company believes 
that its insurance accruals, coupled with its liability coverage, 
is adequate coverage for such claims. 


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.


                              PART II

Item 5.  Market for the Registrant's Common Equity and Related 
Stockholder Matters 

     The Company's Common Stock resumed trading on the Nasdaq 
National Market System under the symbol "WMSI" on March 5, 1998. 
The following table sets forth the high and low sales prices for 
the periods indicated, as obtained from market makers in the 
Company's stock.
<TABLE>
 8/1/96  11/1/96  2/1/97  5/1/97  8/1/97  11/1/97  2/1/98  5/1/98 
10/31/96 1/31/97 4/30/97 7/31/97 10/31/97 1/31/98 4/30/98 7/31/98
-------- ------- ------- ------- -------- ------- ------- -------
<S>      <C>     <C>     <C>      <C>      <C>     <C>     <C>  
  $6.25   $6.38   $5.50   $6.13    $8.13    $7.00   $6.63  $5.19
  $3.00   $2.88   $3.13   $3.75    $5.00    $4.63   $3.75  $3.38
</TABLE>

     The Company paid no cash dividends during the years ended 
July 31, 1998 or 1997.  While it is the directors' policy to have 
the Company pay cash dividends whenever feasible, the Company's 
credit agreements prohibit cash dividends without the lenders' 
permission.  In addition, the need for cash in the Company's 
business indicates that cash dividends will not be paid in the 
foreseeable future.

     The prices shown reflect inter-dealer prices, without retail 
mark-up, mark-down, or commissions and may not necessarily reflect 
actual transactions.

     At September 18, 1998, there were 502 holders of record of 
the Common Stock.

     During the year ended July 31, 1998, NationsBank converted 
its $410,000 Convertible Debenture into the previously agreed upon 
16.4% of the Company's common stock outstanding and committed at 
the time of conversion.  On February 6, 1998, the Company issued 
620,766 shares to NationsBank.   The holder can sell by public 
sale no more than 1/8th of the shares during each quarter 
commencing April 1, 1997 and ending December 31, 1998.  Due to the 
subsequent redemption of the FDIC debentures, explained in the 
following paragraph, at July 31, 1998,  NationsBank owned 
approximately 17% of the outstanding and committed common stock 
of the Company.  As a result of the NationsBank conversion, 
additional paid-in capital in the Company increased by 
approximately $453,000, notes payable decreased by $410,000 and 
interest expense of $43,000 was recorded. 

     On March 2, 1998, the Company redeemed its outstanding 
$90,000 Convertible Debenture with the Federal Deposit Insurance 
Corporation (FDIC) at its face value.  The FDIC did not give 
notice of conversion for the debenture, which would have converted 
into 3.6% of the Company's common stock outstanding or committed 
which approximated 136,000 shares.  On April 3, 1998, the Company 
redeemed at face value a second debenture from the FDIC for 
$75,000.  If this debenture had converted, 110,294 shares of the 
Company's common stock would have been issued.  While the 
commitments represented by the FDIC debentures have been canceled, 
the weighted average impact of the commitments is still reflected 
in the calculation of Earnings Per Common Share - Diluted for the 
periods in which the debentures were outstanding in the years 
ended July 31, 1998 and 1997.

     The shares issued to NationsBank, as well as the 215,000 
shares issued in resolution of the Pribyla litigation, were part 
of a Company filing with the Securities and Exchange Commission 
done as a secondary offering of its securities on Form S-2 on 
behalf of certain selling shareholders.   These shareholders 
received stock or convertible debentures in connection with the 
transactions (Bank Group, FDIC, and Pribyla) described elsewhere 
in this report.  The number of shares included in the Registration 
was 1,080,294, although the FDIC shares were not issued because 
the debentures were redeemed.

     The Company also issued 69,931 shares to First Tennessee 
Equipment Finance Corporation upon First Tennessee's conversion of 
a debenture relating to debt resolution of a former Company 
subsidiary.


Item 6.  Selected Financial Data

     The following table sets forth selected financial data for 
the Company and is qualified in its entirety by the more detailed 
financial statements, related notes thereto, and other statistical 
information appearing elsewhere in this report.
<TABLE>
<CAPTION>
                SELECTED CONSOLIDATED FINANCIAL DATA
                (In millions, except per share data)

                            1998    1997    1996    1995    1994
                           ------  ------  -----   -----   ------
<S>                        <C>     <C>     <C>     <C>     <C>
Statements of Earnings Data: 
Revenue:
     Construction          $17.9   $22.4   $16.1   $19.7   $27.9
     Manufacturing          10.2    11.0    10.1    10.3    16.9
     Other Revenue           0.8     0.9     1.0     1.6     0.8
                           ------  ------  -----   -----   ------
        Total Revenue      $28.9   $34.3   $27.2   $31.6   $45.6  
                           ======  ======  =====   =====   ======
Gross Profit:
     Construction          $ 7.6   $ 8.9   $ 6.5   $ 5.2   $ 4.8 
     Manufacturing           3.1     3.4     3.0     3.9     4.2 
     Other                   0.8     0.9     1.0     1.6     0.8 
                           ------  ------  -----   -----   ------
   Total Gross Profit      $11.5   $13.2   $10.5   $10.7   $ 9.8 
                           ======  ======  =====   =====   ======

Other Income:              $ 0.4   $ 0.1   $ 2.5   $ 0.2   $  - 

Expense:
Overhead                   $ 3.1   $ 3.4   $ 3.1   $ 3.0   $ 3.6
General and
  Administrative             5.0     5.7     5.3     9.0     8.1
Depreciation                 1.2     1.1     1.0     1.2     1.4
Interest                     1.2     1.6     1.5     2.3     1.7
Income Tax
Provision (Benefit)         (0.3)   (1.7)     -       -       -   
                           ------  ------  -----   -----   ------
   Total Expense           $10.2   $10.1   $10.9   $15.5   $14.8
                           ======  ======  =====   =====   ======
Earnings (Loss) from
     Continuing Operations $ 1.7   $ 3.2   $ 2.1   $(4.6)  $(5.0) 
Equity Loss (Earnings) and
  Minority Interest         (0.8)   (0.2)    0.1      -       -
Gain (Loss) from
     Discontinued
     Operations               -       -       -      1.4    (4.6)
Extraordinary Item -
     Gain on Extinguish-
     ment of Debt            0.9     3.2     0.8     6.6      -
                           ------  ------  -----   -----   ------
Net Earnings (Loss)        $ 1.8   $ 6.2   $ 3.0   $ 3.4   $(9.6)
                           ======  ======  =====   =====   ======

Earnings (Loss) Per Share:
     From Continuing
Operations......            $0.28   $1.13  $0.84  $(1.82) $(1.98)
     From Discontinued
     Operations . . . . .     -       -      -      0.57   (1.80)
     Extraordinary Item      0.29    1.20   0.31    2.60      -  
                            -----   -----  -----   -----  -------
        Earnings (Loss) Per
          Share - Basic*    $0.57   $2.33  $1.15   $1.35  $(3.78)
                            =====   =====  =====   =====  =======

Balance Sheet Data 
(at end of year):

Total Assets--Continuing
     Operations            $29.1   $31.5   $28.0   $24.6   $38.4
Net Liabilities
     of Discontinued
     Operations               -       -       -       -     (1.0)
Long Term Obligations        8.4     7.4     5.8     2.9     5.0
Total Liabilities           19.8    24.8    30.2    29.8    46.1
Stockholders' equity
     (Deficiency 
      in assets)             9.1     6.5    (2.2)   (5.2)   (8.7)
</TABLE>
* No dividends have been paid on Common Stock during the above 
periods.

     For purposes of comparison, the years ended July 31, 1994 and 
1995 results include companies that are not components of the 
Company going forward.  The results of the years ended July 31, 
1996, 1997 and 1998 more accurately reflect the Company's 
composition going forward.  Additionally, the Company disposed of 
a number of assets, as discussed in Note 11 to the Notes to 
Consolidated Financial Statements.  These factors are relevant to 
any comparisons.


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

     During the year ended July 31, 1998, the Company achieved a 
number of significant objectives, including:
 
     * The relisting of the Company's stock on the Nasdaq National 
Market System; 

     * Nearly doubling its backlog from approximately $12.5 
million at July 31, 1997 to approximately $21.7 million at July 
31, 1998;

     * Using the proceeds from the sale of the Company's Falls 
Church real estate to reduce the Company's real estate loan by 
more than $1.4 and refinancing the remaining $1,000,000 loan with 
more favorable terms;

     * Redeeming two debentures that removed the Company's 
commitment to issue 246,560 shares, or about seven percent, of the
Company's stock;

     * Resolving outstanding issues of litigation;

     * Improving the Company's overall financial position. 

     * Meeting management's estimate for pre-tax profit of 4% or 
$1.3 million for "Earnings Before Income Taxes, Equity Earnings 
and Minority Interests."

     * Improving gross profit margin to 40% in 1998 from 38% in 
1997.

     Having achieved its goals of debt restructuring and Nasdaq 
relisting, the Company now has a stronger financial and 
operational base from which its subsidiaries, either through 
internal growth or strategic acquisitions, can grow and enhance 
future financial results.

     While the most significant aspect of restructuring, that of 
settling Bank Group debt, occurred in the year ended July 31, 
1997, the year ended July 31, 1998 marked the culmination of 
several remaining aspects of the Company's five-year restructuring 
program.  In addition to completing its restructuring objectives, 
the Company continued to meet another objective, that of 
operational profitability.  These achievements occurred while the 
Company simultaneously reduced its investment in an unconsolidated
affiliate by more than $800,000 and also accrued more than 
$500,000 for litigation settlements.

     The Company's fundamental lines of business are conducted 
through the subsidiaries of Construction Insurance Agency, 
Greenway Corporation, Piedmont Metal Products, Inc., Williams 
Bridge Company, Williams Equipment Corporation, and Williams Steel 
Erection Company, Inc.   These operations, on aggregate, have been 
profitable for several years.  Going forward, these operations 
must produce sufficient aggregate profitable results to sustain 
the parent operation and any auxiliary services.

     Management continues to work to enhance the on-going value of 
Williams Industries Inc., which, in addition to the companies 
mentioned above, includes the parent corporation, Insurance Risk 
Management Group, Inc., and WII Realty Management, Inc., that 
provide services both for all operating companies as well as 
outside customers.

Financial Condition

     The Company has turned around in the past five years.  
Stockholders' Equity increased by $17.8 million over a four year 
period and has grown to $9.1 million at July 31, 1998 from a $8.7 
million deficit at July 31, 1994.

     The Company's credit facility with CIT allows the Company a 
mechanism to borrow against the line for the subsidiaries, should 
the need arise.  This funding mechanism allows the subsidiaries to 
negotiate better payment terms on certain transactions, such as 
the purchase of materials, by having cash available when 
necessary.

     Having completed its debt restructuring program, management 
has more time to focus on operating issues.  These include 
developing innovative methods to obtain quality work and expanding 
into new market areas to more fully avail the Company's 
subsidiaries of new opportunities in traditional market areas.

     The Company's financial performance essentially has improved 
across the board in the past several years, but most specifically 
in the year ended July 31, 1998.  One of the greatest indicators 
of this change is reflected in the Company's Consolidated 
Statements of Cash Flows.   Net Cash Provided By Operating 
Activities was approximately $1.89 million in the year ended July 
31, 1998, as compared to the ($105,151) used in operating 
activities in the year ended July 31, 1997.  Cash flows from 
investing activities increased primarily as a result of the sale 
of the Falls Church property and some older equipment.  Proceeds 
from borrowings declined to $4.0 million, while the Company made 
repayments of Notes Payable of $7 million.  

     Issues of profitability and quantifying any future expense 
dominated many of the Company's activities in the year ended July 
31, 1998.  Williams Industries, Inc. results varied throughout the 
year, as significant transactions affected quarterly results.  
These included the reduction of approximately $800,000 of the 
Company's investment in Atlas Machine and Iron Works, an 
unconsolidated affiliate; a $809,000 Gain on Extinguishment of 
Debt from the reversal of accounts payable in a closed subsidiary, 
the John F. Beasley Construction Company; and an accrual of 
approximately $500,000 for litigation settlements.  Third quarter 
cash flows were impacted by the $165,000 used to redeem the FDIC 
debentures, described in Item 5, included in this report.

     The combination of all these elements, however, produced the 
bottom line results which are in keeping with management's 
projections and announced expectations for the year.  Going 
forward, management intends to continue following a course that 
will allow for sustained growth and profitability while 
simultaneously enhancing the Company's financial condition and 
increasing shareholder value.

     Issues which had the potential to impact the Company's future 
earnings also have been resolved.  The settlement and 
quantification of expense and exposure to old legal issues enables 
the Company to be more certain of its position going forward.  
Although certain contingencies are discussed in Note 15 to the 
Notes to Consolidated Financial Statements, management believes 
that major uncertainties that could have impacted the Company's 
financial posture have largely been removed, enabling management, 
potential creditors and customers to have a much clearer picture 
of the Company's financial future.   



Bonding

     The Company's ability to furnish payment and performance 
bonds has improved along with its financial condition.   For 
example, the Company now has a commitment from one bonding company 
to furnish a bond for a $6.5 million bridge fabrication project.  
While historically, because of its strong reputation, most of the 
Company's projects have been obtained without providing bonds, the 
Company recognizes as it expands its geographic range for 
providing goods and services, it will be necessary to provide 
bonds to clients unfamiliar with the Company.  This is not 
anticipated to present a problem going forward.   

Liquidity

     The Company is generating sufficient cash to sustain its
operational activities.   Management is keeping a close eye on
cash needs to ensure that adequate liquidity is maintained.   To 
address this concern, credit availability under the CIT facility 
has been expanded.

     Cash Flows From Operating Activities for the Year Ended July 
31, 1998 were $1,885,836 and primarily resulted from profitable 
operations.   

     Cash Flows From Investing Activities increased from ($50,804) 
in the year ended July 31, 1997 to $929,174 in the year ended July 
31, 1998, primarily as a result of the sale of the Company's Falls 
Church real estate and some older equipment.  Expenditures for 
property, plant and equipment were maintained at acceptable levels 
as the Company has been updating its crane fleet primarily though 
operating leases.  Management feels that leasing instead of more 
traditional buying or borrowing offers more flexibility and cash 
flow advantages.

     Management invested some surplus cash in Certificates of 
Deposit with maturities longer than 90 days, but less than one 
year, which are not classified as cash or cash equivalents.  
However, these investments are readily convertible to cash to meet 
the Company's requirements.

     Cash Flows From Financing Activities, $746,924 in the year 
ended July 31, 1997 and ($2,922,507) in the year ended July 31,  
1998,  were reduced as the Company continued its efforts to reduce 
overall debt.

     Going forward, management believes that operations will 
continue to generate sufficient cash to fund activities. However, 
as revenues increase, operations may have periods in which they 
use net cash.  Management, therefore, is focusing on the proper 
allocation of resources to ensure stable growth.

Operations

     While not achieving the record revenue levels experienced at 
some subsidiaries in the year ended July 31, 1997, the year ended 
July 31, 1998 was extremely good for the Company as, for the most 
part, routine operations, not unusual or extraordinary 
transactions, created profitable results.  Having survived the 
upheaval of massive restructuring, the Company's subsidiaries are 
continuing to focus on the business of performing quality work at 
consistently profitable levels.

     Each of the Company's operating entities has benefited from 
the increased activity in the construction marketplace as well as 
the improved financial condition of the parent corporation.   
Recently passed federal legislation, which will funnel billions of 
dollars into infrastructure construction, is anticipated to further
increase the Company's fabrication and construction activities.   
In its highly concentrated reconfiguration, the Company and its 
subsidiaries are poised to take advantage of the opportunities now 
in the marketplace.

     The subsidiaries are finding it easier to obtain new 
equipment or supplies based on their own results and 
profitability, as well as the improved condition of the parent.  
This trend is expected to continue and will lead to further 
improved results through reduced finance costs and the more 
efficient delivery of services through enhanced capabilities.

     
1.  Fiscal Year 1998 Compared to Fiscal Year 1997

     From an operating perspective, the year ended July 31, 1998 
started  slowly.  During the first quarter, both construction and 
manufacturing revenues decreased.  A significant portion of the 
decrease was attributed to the fact that the Company's largest 
subsidiary, Williams Steel Erection Company, had a more than fifty 
percent decline in its revenues.  This was due to the fact that 
in the prior year, Williams Steel had record revenues and was 
working simultaneously on several major projects.  It wasn't 
until the fourth quarter of the year ended July 31, 1998 that 
Williams Steel regained its previously high level of activity.  
In the beginning and middle of year ended July 31, 1998, extremely 
wet weather caused the postponement or cancellation of a number of 
jobs, many of which related to crane rental or rigging.  It wasn't 
until the last four months of the year ended July 31, 1998 that 
the Company's operating activities picked up.

     As a consequence, revenues for the year ended July 31, 1998 
lagged behind the year ended July 31, 1997 in all categories.  The 
most noticeable decline, however, occurred in Construction where 
revenues declined from $22,387,476 in the year ended July 31, 1997 
to $17,914,705 in the year ended July 31, 1998.

     Manufacturing revenues declined slightly, from $10,975,857 in 
the year ended July 31, 1997 to $10,205,689 in the year ended July 
31, 1998.

     Earnings Before Income Taxes, Equity Earnings and Minority 
Interests decreased slightly from $1,463,686 in the year ended 
July 31, 1997 to $1,353,192 in the year ended July 31, 1998, 
despite the fact that revenues declined by nearly $6 million.  The 
profit levels for the year ended July 31, 1998 are in keeping with 
management's announced expectations for the year.

     The provision for income taxes for the year ended July 31, 
1998 was a benefit of $343,000 compared to a benefit of $1.7 
million for the year ended July 31, 1997.  In the year ended July 
31, 1997, the Company completed the restructuring of its Bank 
Group Debt and, for the first time in several years, returned to 
profitable operations.  As a result, in accordance with Statement 
of Financial Accounting Standards No. 109, during the year ended 
July 31, 1997, the Company recognized $2.2 million of the benefits 
available from its tax loss carryforwards that had accumulated 
over several years.  Further, as a result of continued profitable 
operations, during the year ended July 31, 1998, the Company 
recognized an additional benefit of its tax loss carryforwards of 
$900,000.

     During the year ended July 31, 1998, the Company also had a 
$800,000 reduction in its investment of an unconsolidated 
affiliate, Atlas Machine and Iron Works, shown in "Equity in 
(loss) earnings of unconsolidated affiliates", as well as an 
expense of approximately $500,000 relating to the settlement of 
litigation on old insurance polices.


2.  Fiscal Year 1997 Compared to Fiscal Year 1996

     "Revenue" showed an improvement from $27,157,512 in fiscal 
1996 to $34,308,519 in fiscal 1997, which was attributable to 
several sources, but most specific to several "mega" projects, 
such as the MCI Arena and major semiconductor plants in Richmond 
and Manassas, Virginia, undertaken by Williams Steel Erection 
Company during the year.   The "Other Income" amounts consist of 
real estate sales and  reflect the varying gains recognized from 
these transactions.  For details of real estate sales, refer to 
Note 11 in the Notes to Consolidated Financial Statements.

     For the year ended July 31, 1996, the total construction and 
manufacturing revenue was $26,193,901 which compares to 
$33,363,333 for the year ended July 31, 1997, or more than a 27 
percent increase in revenue.  With the completion of the MCI 
Arena, the Company concluded essentially all of its "mega" steel 
erection contracts.  There currently are not any outstanding bids 
on projects of similar size.  As a result, the Company's backlog  
declined from $19 million as of July 31, 1996 to approximately 
$12.5 million as of July 31, 1997.  In order to increase the 
backlog, the Company continues to pursue other joint venture 
arrangements in both the construction and manufacturing segments 
on certain projects which are greater than $1.0 million in size 
and complex enough to involve large quantities of manpower, 
management time and equipment.  The Company's policy is to enter 
into joint ventures only where it is at least a 50% partner and 
actively participates in the management of the venture.  Further, 
the Company's policy is to seek to engage in joint ventures with 
partners whose reputation and status in the industry indicate to 
management that they are trustworthy partners.   During the course 
of the MCI Joint Venture, there were no disputes regarding 
management, but the agreement did provide for an alternative 
dispute resolution mechanism, as will any future joint venture 
arrangement.

     In continuing the year to year comparisons, several 
transactions or sales in both years are highly complicated.  For 
details of these events, refer to the Notes 10 and 11 to 
Consolidated Financial Statements elsewhere in this document.

     Unusual events have contributed to "Earnings Before 
Extraordinary Items" of $2,982,512 for the year ended July 31, 
1997 as compared to the $2,152,847 for the year ended July 31, 
1996, most particularly the net $1.8 million deferred income tax 
asset recognized in 1997, and the $2.4 million gain on the sale of 
real estate recognized in 1996 (See Note 8).

     With respect to the income tax asset, as a result of tax 
losses incurred in prior years, the Company, at July 31, 1997, had 
tax loss carryforwards amounting to approximately $15 million.  
Under Statement of Financial Accounting Standards No. 109 ("SFAS 
109"), the Company is required to recognize the value of these tax 
loss carryforwards if it is more likely than not that they will be 
realized by reducing the amount of the Company's profitability in 
future years during the carryforward period.  As a result of the 
completion of the restructuring of the Company's Bank Group debt 
during 1997 and the return to profitable operations of the 
Company's ongoing businesses during the past two years, the 
Company expects to report profits for income tax purposes in the 
future.  As a consequence, the Company recognized a $2.2 million 
portion of the benefit available from its tax loss carryforwards 
during the year ended July 31, 1997.

     Revenues for the year ended July 31, 1997 exceeded projected 
levels and expenses were kept to reasonable and customary levels.   
From a core company aggregate operating perspective, revenues, 
gross profit and pre-tax profit all increased when the years are 
compared.  Overhead expense increased as a result of increased 
operational activity.  General and Administrative expense, which 
does not vary according to revenue levels, increased primarily as 
a result of settlement of litigation.


Year 2000

     The Company is currently reviewing all systems for compliance
with Year 2000 issues.  This review includes  information 
technology systems as well as non-information technology systems 
and discussions with third party customers regarding their Year 
2000 compliant status. The Company intends to be finished with its 
review and have any identified Year 2000 issues fixed by July 31, 
1999. 

     Based on the Company's review to date, there are no major 
Year 2000 compliant issues and, therefore, the Company has not,
and does not intend to prepare a contingency plan.  The Company
believes its most reasonable, likely worse case Year 2000 scenario 
is if its customers are not Year 2000 compliant and payments to 
the Company are delayed.  If this occurs, the Company believes 
that it could delay payments to vendors and use its capital and 
financing lines to pay its most critical costs. 

     The Company currently anticipates that the financial impact 
due to year 2000 compliant issues will not exceed $10,000.  The 
Company intends to pay these costs from cash flows generated from 
operations.  To date, none of this amount has been expended.


Item 7a.  Quantitative and Qualitative Disclosures About 
          Market Risk

     Williams Industries, Inc. uses fixed and variable rate notes 
payable, a tax exempt bond issue, and a vendor credit facility to 
finance its operations.  These on-balance sheet financial 
instruments, to the extent they provide for variable rates of 
interest, expose the Company to interest rate risk, with the 
primary interest rate exposure resulting from changes in the prime 
rates or Industrial Revenue Bond (IRB) rate used to determine the 
interest rates that are applicable to borrowings under the 
Company's vendor credit facility and tax exempt bond.

     The information below summarizes Williams Industries, Inc.'s 
sensitivity to market risks associated with fluctuations in 
interest rates as of July 31, 1998.  To the extent that the 
Company's financial instruments expose the Company to interest 
rate risk, they are presented in the table below.  The table 
presents principal cash flows and related interest rates by year 
of maturity of the Company's vendor credit facility and tax exempt 
bond in effect at July 31, 1998.   Notes 7, 10, and 15 to the 
consolidated financial statements contain descriptions of the 
Company's credit facility and tax exempt bond and should be read 
in conjunction with the table below.
<TABLE>
<CAPTION>
Financial Instruments by Expected Maturity Date


Year Ended July 31,    1999        2000        2001        2002  
                    ----------  ----------  ----------  ---------- 
<S>                 <C>         <C>         <C>         <C>      
Interest Rate 
 Sensitivity
Notes Payable:
 Variable rate ($)    461,522   1,756,862      90,000     95,000
 Average Interest 
   Rate                  9.70       10.64        3.48       3.48

                    ----------  ----------  ----------  ---------- 
 Fixed Rate ($)     1,486,096     905,594   1,162,101    625,340
 Fixed Interest 
   Rate                  9.17        9.77        9.77       9.58
</TABLE>
<TABLE>

Year Ended July 31,         2003     Thereafter     Total
                         ----------  ----------  ----------
<S>                      <C>         <C>         <C>
Interest Rate 
 Sensitivity
Notes Payable:
 Variable rate ($)        100,000      815,000   3,318,384
 Average Interest
   Rate                      3.48        3.48         8.13
                         ----------  ----------  ----------
 Fixed Rate ($)         1,410,419    1,396,803   6,986,353
 Fixed Interest          
   Rate                      9.58        10.00        9.67

</TABLE>

Item 8.  Williams Industries, Incorporated Consolidated Financial 
Statements for the Years ended July 31, 1998, 1997 and 1996.

     (See pages which follow.)


Item 9.  Disagreements on Accounting and Financial Disclosures.

     None.


Part III

     Pursuant to General Instruction G(3) of Form 10-K, the 
information required by Part III (Items 10, 11, 12 and 13) is 
hereby incorporated by reference to the Company's definitive proxy 
statement to be filed with the Securities and Exchange Commission, 
pursuant to Regulation 14A promulgated under the Securities 
Exchange Act of 1934, in connection with the Company's Annual 
Meeting of Shareholders scheduled to be held November 14, 1998.


Part IV

Item 14.  Exhibits, Financial Statement Schedules, and Reports on 
Form 8-K.

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

(a)1. Consolidated Financial Statements of Williams Industries, 
      Incorporated and Independent Auditors' Report.

        Report of Deloitte & Touche LLP.

        Consolidated Balance Sheets as of July 31, 1998 and 1997.

        Consolidated Statements of Earnings for the Years Ended 
        July 31, 1998, 1997 and 1996.

        Consolidated Statements of Stockholders' Equity (Deficiency
        in Assets) for the Years Ended July 31, 1998, 1997 and 1996.

        Consolidated Statements of Cash Flows for the Years Ended 
        July 31, 1998, 1997 and 1996.

        Notes to Consolidated Financial Statements for the Years 
        Ended July 31, 1998, 1997 and 1996.

   2. Schedule II -- Valuation and Qualifying Accounts for 
      the Years Ended July 31, 1998, 1997, and 1996
      of Williams Industries, Incorporated.


      (All included in this report in response to Item 8.)


      Schedules to be Filed by Amendment to this Report.

        NONE

      3(b) Exhibits:

        (3)  Articles of Incorporation: Incorporated by reference 
             to Exhibit 3(a) of the Company's 10-K for the year
             ended July 31, 1989.  By-Laws: Incorporated by 
             reference to Exhibit 3 of the Company's 8-K filed 
             September 4, 1998.


        (21) Subsidiaries of the Company

<TABLE>
            Name                                      State of
                                                   Incorporation
            -------------------------------------  -------------
            <S>                                         <C>
            Arthur Phillips & Company, Inc.*            MD
            Capital Benefit Administrators, Inc.*       VA
            Construction Insurance Agency, Inc.         VA
            John F. Beasley Construction Company*       TX
            Greenway Corporation                        MD
            IAF Transfer Corporation*                   VA
            Insurance Risk Management Group, Inc.       VA
            Piedmont Metal Products, Inc.               VA
            Williams Bridge Company                     VA
            Williams Enterprises, Inc.*                 DC
            Williams Equipment Corporation              DC
            WII Realty Management, Inc.                 VA
            Williams Steel Erection Company             VA
</TABLE>
            * Not Active 

       (27) Financial Data Schedule


(b)  The Company filed a Form 8-K on September 4, 1998, 
     reporting the adoption of amended and restated By-Laws for 
     the Company.


                      INDEPENDENT AUDITORS' REPORT


To the Board of Directors and Stockholders
Williams Industries, Incorporated
Falls Church, Virginia

We have audited the accompanying consolidated balance sheets of 
Williams Industries, Incorporated, and subsidiaries (the 
"Company") as of July 31, 1998 and 1997, and the related 
consolidated statements of earnings, stockholders' equity 
(deficiency in assets) and cash flows for each of the three years 
in the period ended July 31, 1998.  Our audits also included the 
financial statement schedule listed in Item 14.  These financial 
statements and financial statement schedule are the responsibility 
of the Company's management.  Our responsibility is to express an 
opinion on these financial statements and financial statement 
schedule 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, such consolidated financial statements present 
fairly in all material respects, the consolidated financial 
position of Williams Industries, Incorporated, and subsidiaries as 
of July 31, 1998 and 1997, and the consolidated results of their 
operations and their cash flows for each of the three years in the 
period ended July 31, 1998 in conformity with generally accepted 
accounting principles.  Also, in our opinion, such financial 
statement schedule, when considered in relation to the basic 
consolidated financial statements taken as a whole, presents 
fairly in all material respects the information as set forth 
therein.



Deloitte & Touche LLP

McLean, VA
September 25, 1998

<PAGE>
<TABLE>
<CAPTION>
                 WILLIAMS INDUSTRIES, INCORPORATED
                    CONSOLIDATED BALANCE SHEETS
                   AS OF JULY  31, 1998 AND 1997

                               ASSETS
                              --------
                                          1998            1997
                                     ------------    ------------
     <S>                             <C>             <C>
     CURRENT ASSETS
     Cash and cash equivalents       $ 1,384,339     $ 1,491,836 
     Restricted cash                      54,004         252,412 
     Certificates of deposit             732,616         375,308 
     Accounts receivable (net of 
         allowances for doubtful 
         accounts of $1,211,000 in 
         1998 and $758,000 in 1997): 
       Contracts
         Open accounts                 7,057,543       7,395,313 
         Retainage                       585,506         563,730 
       Trade                           1,749,778       1,516,796 
       Other                             302,445         100,970 
     Inventory (Note 1)                1,320,245       1,462,817 
     Costs and estimated earnings in 
       excess of billings on
       uncompleted contracts (Note 5)    665,926         845,325 
     Notes receivable                     33,706          43,224 
     Prepaid expenses                    568,689         564,538 
                                     ------------    ------------
          Total current assets        14,454,797      14,612,269 
                                     ------------    ------------
     PROPERTY AND EQUIPMENT, 
         AT COST (Note 6)             19,066,486      20,073,398 
       Accumulated depreciation       (9,355,343)     (9,387,155)
                                     ------------    ------------
         Property and equipment, net   9,711,143      10,686,243 
                                     ------------    
------------                                    
     OTHER ASSETS                               
       Notes receivable                  128,761         167,975 
       Contract claims, net (Note 2)        -            534,025 
       Investments in unconsolidated 
         affiliates                      979,769       1,770,940 
       Deferred income taxes (Note 8)  2,240,000       1,800,000 
       Inventory (Note 1)              1,243,754       1,264,997 
       Other                             354,971         653,270 
                                     ------------    ------------
          Total other assets           4,947,255       6,191,207 
                                     ------------    ------------
     TOTAL ASSETS                    $29,113,195     $31,489,719 
                                     ============    ============
</TABLE>
          See Notes To Consolidated Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
                  WILLIAMS INDUSTRIES, INCORPORATED
                     CONSOLIDATED BALANCE SHEETS
                    AS OF JULY  31, 1998 AND 1997

                 LIABILITIES AND STOCKHOLDERS' EQUITY
                 ------------------------------------
                                    
                                          1998            1997
                                     ------------    ------------
     <S>                             <C>             <C>
     CURRENT LIABILITIES                               
     Current portion of notes 
       payable (Note 7)              $ 1,947,618     $ 5,281,243 
     Accounts payable                  4,017,376       4,842,837 
     Accrued compensation and 
       related liabilities               760,620         694,634 
     Billings in excess of costs 
       and estimated earnings on                               
       uncompleted contracts (Note 5)  1,885,069       2,972,587 
     Deferred income                     306,000            -
     Other accrued expenses            2,357,125       3,531,599 
     Income taxes payable (Note 8)       159,200         108,000 
                                     ------------    ------------
     Total current liabilities        11,433,008      17,430,900 
                                    
     LONG-TERM DEBT 
     Notes payable, less
         current portion (Note 7)      8,357,119       7,356,813 
                                     ------------    ------------
     Total Liabilities                19,790,127      24,787,713 
                                     ------------    ------------
     MINORITY INTERESTS                  189,618         170,237 
                                     ------------    ------------
                                    
     COMMITMENTS AND 
       CONTINGENCIES (NOTE 15)              -               -
                                    
     STOCKHOLDERS' EQUITY                               
     Common stock - $0.10 par value,
       10,000,000 shares authorized;
       3,576,429 and 2,839,756 
       shares issued and outstanding 
       (Note 18)                          357,643         283,976
     Additional paid-in capital        16,385,704      15,705,430
     Accumulated deficit               (7,609,897)     (9,457,637)
                                      ------------    ------------
     Total stockholders' equity         9,133,450       6,531,769
                                      ------------    ------------
                                    
     TOTAL LIABILITIES AND 
     STOCKHOLDERS' EQUITY             $29,113,195     $31,489,719
                                      ============    ============
</TABLE>
          See Notes To Consolidated Financial Statements.

<PAGE>
<TABLE>
<CAPTION>
                 WILLIAMS INDUSTRIES, INCORPORATED
                CONSOLIDATED STATEMENTS OF EARNINGS
             YEARS ENDED JULY 31, 1998, 1997 and 1996

                              1998         1997         1996
                           ------------ ------------ ------------
<S>                      <C>           <C>           <C>
REVENUE:                                         
     Construction          $17,914,705  $22,387,476  $16,131,534 
     Manufacturing          10,205,689   10,975,857   10,062,367 
     Other revenue             783,765      945,186      963,611 
                           ------------ ------------ ------------
          Total revenue     28,904,159   34,308,519   27,157,512 
                           ------------ ------------ ------------
DIRECT COSTS:
     Construction           10,265,866   13,511,100    9,630,774 
     Manufacturing           7,139,596    7,621,577    7,002,594 
                           ------------ ------------ ------------
     Total direct costs     17,405,462   21,132,677   16,633,368 
                           ------------ ------------ ------------
GROSS PROFIT                11,498,697   13,175,842   10,524,144 
                           ------------ ------------ ------------
OTHER INCOME                   356,462       60,035    2,509,864 
                           ------------ ------------ ------------
EXPENSES:
     Overhead                3,115,578    3,418,136    3,072,133 
     General and 
         administrative      5,015,978    5,667,798    5,310,514 
     Depreciation and 
         amortization        1,221,459    1,079,682      984,662 
     Interest                1,148,952    1,606,575    1,510,985 
                           ------------ ------------ ------------
     Total expenses         10,501,967   11,772,191   10,878,294 
                           ------------ ------------ ------------
EARNINGS BEFORE INCOME 
TAXES, EQUITY EARNINGS 
AND MINORITY INTERESTS       1,353,192    1,463,686    2,155,714 
                                         
INCOME TAX (BENEFIT) 
PROVISION (NOTE 8)            (343,000)  (1,716,000)      62,500 
                           ------------ ------------ ------------
EARNINGS BEFORE EQUITY
EARNINGS AND MINORITY 
INTERESTS                    1,696,192    3,179,686    2,093,214 
  Equity in (loss) earnings
     of unconsolidated
     affiliates               (746,471)    (148,310)      83,350 
  Minority interest in 
    consolidated subsidiary    (29,981)     (48,864)     (23,717)
                           ------------ ------------ ------------
EARNINGS BEFORE 
EXTRAORDINARY ITEM             919,740    2,982,512    2,152,847 
EXTRAORDINARY ITEM (NOTE 3)
  Gain on extinguishment 
    of debt                    928,000    3,189,000      808,000 
                           ------------ ------------ ------------
NET EARNINGS               $ 1,847,740  $ 6,171,512  $ 2,960,847 
                           ============ ============ ============
EARNINGS PER COMMON SHARE:                                         
  BASIC:
     Earnings before 
     extraordinary item    $      0.28  $      1.13  $      0.84 
     Extraordinary item           0.29         1.20         0.31 
    EARNINGS PER           ------------ ------------ ------------
    COMMON SHARE-BASIC     $      0.57  $      2.33  $      1.15 
                           ============ ============ ============
  DILUTED:
     Earnings before 
     extraordinary item    $      0.27  $      1.08  $      0.81 
     Extraordinary item           0.25         1.05         0.31 
    EARNINGS PER COMMON    ------------ ------------ ------------
    SHARE-DILUTED          $      0.52  $      2.13  $      1.12 
                           ============ ============ ============

</TABLE>

           See Notes To Consolidated Financial Statements.

<PAGE>
<TABLE>
<CAPTION>

                 WILLIAMS INDUSTRIES, INCORPORATED
          CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY 
                     (DEFICIENCY IN ASSETS)
             YEARS ENDED JULY 31, 1998, 1997 and 1996

                                    Additional
                 Number    Common     Paid-In     Accumulated
               of Shares   Stock      Capital       Deficit       Total
              ----------  --------  -----------  -------------  ------------
<S>            <C>        <C>       <C>          <C>            <C>
BALANCE, 
AUGUST 1, 1995
               2,539,017  $253,902  $13,095,153  $(18,589,996)  $(5,240,941)
Issuance 
  of stock        37,000     3,700       52,280          -           55,980 
Net earnings 
  for the year      -         -            -        2,960,847     2,960,847 
              ----------  --------  -----------  -------------  ------------

BALANCE, 
JULY 31, 1996
               2,576,017   257,602   13,147,433   (15,629,149)   (2,224,114)
Issuance 
  of stock       263,739    26,374      449,740          -          476,114 
Issuance of 
  convertible 
  debentures        -         -       2,108,257          -        2,108,257 
Net earnings 
  for the year      -         -            -        6,171,512     6,171,512 
              ----------  --------  -----------  -------------  ------------

BALANCE, 
JULY 31, 1997
               2,839,756   283,976   15,705,430    (9,457,637)    6,531,769 
Conversion of 
  convertible 
  debentures     690,697    69,070      484,101          -          553,171 
Other stock 
  issued          45,976     4,597      196,173          -          200,770 
Net earnings 
  for the year      -         -            -        1,847,740     1,847,740 
              ----------  --------  -----------  -------------  ------------

BALANCE, 
JULY 31, 1998
              $3,576,429  $357,643  $16,385,704  $ (7,609,897)  $ 9,133,450 
              ==========  ========  ===========  =============  ============
</TABLE>

          See Notes To Consolidated Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
                  WILLIAMS INDUSTRIES, INCORPORATED
               CONSOLIDATED STATEMENTS OF CASH FLOWS
             YEARS ENDED JULY 31, 1998, 1997 and 1996

                              1998         1997         1996
                           ------------ ------------ ------------
<S>                        <C>          <C>          <C>

CASH FLOWS FROM 
OPERATING ACTIVITIES:                                         
  Net earnings             $ 1,847,740  $ 6,171,512  $ 2,960,847 
  Adjustments to reconcile 
      net earnings to net                                         
      cash provided by 
      (used in) operating 
      activities:                                         
    Depreciation and 
      amortization           1,221,459    1,079,682      984,662 
    Increase (decrease) 
      in allowance for 
      doubtful accounts        452,987     (195,780)    (679,645)
    Interest expense 
      related to 
      convertible debentures    43,171      269,937         -
    Stock bonus issued 
      to employees             140,508       50,000       52,955 
    Gain on extinguishment 
      of debt                 (928,000)  (3,189,000)    (808,000)
    Gain on disposal of 
      property, plant 
      and equipment           (892,976)    (408,515)  (2,323,496)
    Increase in deferred 
      income taxes            (440,000)  (1,800,000)        -
    Minority interest 
      in earnings               29,981       48,864       23,717 
    Equity in losses 
      (earnings) of 
      affiliates               746,471      (51,690)     (83,350)
    Dividend from 
      unconsolidated 
      affiliate                 44,700       67,050       22,350 
  Changes in assets and 
      liabilities:
    Decrease in notes 
      receivable                48,732       13,801         -
    Decrease (increase) in open 
      contracts receivable    (179,295)     705,043   (1,021,625)
    (Increase) decrease in 
      contract retainage       (21,776)     125,414      470,366 
    Increase in trade 
      receivables             (270,654)    (245,914)    (164,284)
    Decrease (increase) 
      in contract claims       534,025      352,622     (732,285)
    (Increase) decrease in 
      other receivables       (205,868)      32,635      193,795 
    Decrease (increase) 
      in inventory             163,815     (558,461)     252,334 
    (Increase) decrease in 
      costs and estimated 
      earnings related to 
      billings on uncompleted 
      contracts, net          (908,119)     516,273    1,507,863 
     Decrease (increase) in 
      prepaid expenses and 
      other assets             294,148      155,045     (454,517)
    Increase (decrease) 
      in accounts payable      102,539   (1,718,978)    (216,735)
    Increase (decrease) in 
      accrued compensation 
      and related liabilities   65,986     (159,289)     257,028 
    (Decrease) increase in 
      other accrued expenses   (54,938)  (1,377,402)     261,827 
    Increase in income taxes 
      payable                   51,200       12,000       46,000 
                           ------------ ------------ ------------
NET CASH PROVIDED BY (USED 
IN) OPERATING ACTIVITIES     1,885,836     (105,151)     549,807 
                           ------------ ------------ ------------

CASH FLOWS FROM 
INVESTING ACTIVITIES:                                         
  Expenditures for property, 
    plant and equipment       (947,890)    (861,325)    (924,581)
  Decrease (increase) 
    in restricted cash         198,408      147,588     (300,000)
  Proceeds from sale of 
    property, plant and 
    equipment                2,035,964    1,038,241    3,389,348 
  Purchase of minority 
    interest                      -            -         (22,900)
  Purchase of certificates 
    of deposit                (652,589)    (375,308)        -
  Maturities of 
    certificates of deposit    295,281         -            -
                           ------------ ------------ ------------
NET CASH PROVIDED BY(USED IN) 
INVESTING ACTIVITIES           929,174      (50,804)   2,141,867 
                           ------------ ------------ ------------

CASH FLOWS FROM 
FINANCING ACTIVITIES:                                         
  Proceeds from borrowings   4,039,690    7,203,403    1,308,134 
  Repayments of notes 
    payable                 (7,011,859)  (6,536,658)  (3,815,423)
  Issuance of common stock      60,262       90,177        3,025 
  Minority interest dividends  (10,600)      (9,998)      (6,278)
                           ------------ ------------ ------------
NET CASH (USED IN) PROVIDED 
BY FINANCING ACTIVITIES     (2,922,507)     746,924   (2,510,542)
                           ------------ ------------ ------------

NET (DECREASE) INCREASE IN 
CASH AND CASH EQUIVALENTS     (107,497)     590,969      181,132 
CASH AND CASH EQUIVALENTS, 
  BEGINNING OF YEAR          1,491,836      900,867      719,735 
                           ------------ ------------ ------------
CASH AND CASH EQUIVALENTS, 
  END OF YEAR              $ 1,384,339  $ 1,491,836  $   900,867 
                           ============ ============ ============
                                         
SUPPLEMENTAL DISCLOSURES 
OF CASH FLOW INFORMATION (NOTE 16)

</TABLE>

          See Notes To Consolidated Financial Statements.
<PAGE>

                WILLIAMS INDUSTRIES, INCORPORATED

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            YEARS ENDED JULY 31, 1998, 1997 AND 1996

SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES

     Basis of Consolidation - The consolidated financial 
statements include the accounts of Williams Industries, Inc. and 
all of its majority-owned subsidiaries (the "Company"). 

     All material intercompany balances and transactions have been 
eliminated in consolidation.

     Unconsolidated Affiliates - The equity method of accounting 
is utilized when the Company, through ownership percentage, 
membership on the Board of Directors or through other means, meets 
the requirement of significant influence over the operating and 
financial policies of an investee.

     The Company's 42.5% ownership interest in S.I.P., Inc. of 
Delaware is accounted for using the equity method.  Under the 
equity method, original investments are recorded at cost and 
adjusted by the Company's share of distributions and undistributed 
earnings and losses of the investment.   The cost method of 
accounting is used for the Company's 36.6% ownership interest in 
Atlas Machine & Iron Works, Inc. ("Atlas") since the Company can 
not exert significant influence over Atlas's operating and 
financial policies  (See Note 9).

     Estimates - 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 disclosures 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.

     Depreciation and Amortization - Property and equipment are 
recorded at cost and are depreciated over the estimated useful 
lives of the assets using the straight-line method of depreciation 
for financial statement purposes, with estimated lives of 25 years 
for buildings and 3 to 12 years for equipment, vehicles, tools, 
furniture and fixtures.  Leasehold improvements are amortized over 
the lesser of 10 years or the remaining term of the lease.  
Straight-line and accelerated methods of depreciation are used for 
income tax purposes.

     Ordinary maintenance and repair costs are charged to expense 
as incurred while major renewals and improvements are capitalized.  
Upon the sale or retirement of property and equipment, the cost 
and accumulated depreciation are removed from the respective 
accounts and any gain or loss is recognized.

     Earnings Per Common Share - "Earnings Per Common Share-Basic" 
is based on the weighted average number of shares outstanding 
during the year.  "Earnings Per Common Share-Diluted" is based on 
the shares outstanding and the weighted average of commitments to 
issue stock, which may include convertible debentures, stock 
options, or grants.

     Revenue Recognition - Revenues and earnings from long-term 
construction contracts are recognized for financial statement 
purposes using the percentage-of-completion method; therefore, 
revenue includes that percentage of the total contract price that 
the cost of the work completed to date bears to the estimated 
final cost of the contract.  Estimated contract earnings are 
reviewed and revised periodically as the work progresses, and the 
cumulative effect of any change in estimate is recognized in the 
period in which the estimate changes.  When a loss is anticipated 
on a contract, the entire amount of the loss is provided for in 
the current period.  Contract claims are recorded at estimated net 
realizable value (see Note 2).

     Overhead - Overhead includes the variable, non-direct costs 
such as shop salaries, consumable supplies, and vehicle and 
equipment costs incurred to support the revenue generating 
activities of the Company.

     Inventories - Inventories consist of materials, expendable 
equipment and tools, and supplies.   Materials inventory consists 
of structural steel, metal decking, and steel cable.  Expendable 
tools and equipment, and supplies consist of goods which are 
consumed on projects.  Costs of materials inventory is accounted 
for using either the specific identification method or average 
cost.  Cost of expendable equipment and tools is accounted for 
using average costs.  The cost of supplies inventory is accounted 
for using the first-in, first-out, (FIFO) method.  

     Allowance for Doubtful Accounts - Allowances for 
uncollectible accounts and notes receivable are provided on the 
basis of specific identification.

     Income Taxes - Williams Industries, Inc. and its 
subsidiaries, which are at least eighty percent owned by the 
parent, file a consolidated Federal income tax return.   The 
provision for income taxes has been computed under the 
requirements of Statement of Financial Accounting Standards (SFAS) 
No. 109, "Accounting for Income Taxes".   Under SFAS No. 109, 
deferred tax assets and liabilities are determined based on the 
difference between the financial statement and the tax basis of 
assets and liabilities, using enacted tax rates in effect for the 
year in which the differences are expected to reverse.       

     The Company does not provide for income taxes on the 
undistributed earnings of affiliates since these amounts are 
intended to be permanently reinvested.  The cumulative amount of 
undistributed earnings on which the Company has not recognized 
income taxes as of July 31, 1998 is approximately $1,060,000.

     Cash and Cash Equivalents - For purposes of the Statements of 
Cash Flows, the Company considers all highly liquid instruments 
and certificates of deposit with original maturities of less than 
three months to be cash equivalents.

     Restricted Cash - The Company's restricted cash is invested 
in short-term, highly liquid investments.  The carrying amount 
approximates fair value because of the short-term maturity of 
these investments.

     Certificates of Deposit - The Company's certificates of 
deposit have original maturities greater than 90 days, but not 
exceeding one year.

     Stock-Based Compensation - The Company has elected to follow 
Accounting Principles Board Opinion No. 25 (APB 25), "Accounting 
for Stock Issued to Employees" and related interpretations in 
accounting for its employee stock options.  Under APB 25, because 
the exercise price of employee stock options equals the market 
price of the underlying stock on the date of the grant, no 
compensation expense is recorded.  The Company has adopted the 
disclosure-only provisions of Statement of Financial Accounting 
Standards No. 123, "Accounting for Stock-Based Compensation."

     Reclassifications - Certain reclassifications of prior years' 
amounts have been made to conform with the current year's 
presentation. 

     The Company has presented classified balance sheets at July 
31, 1998 and 1997.  Previously, an unclassified balance sheet was 
issued at July 31, 1997 and earlier years because many contracts 
the Company entered into took in excess of one year to complete.  
Therefore, the Company's operating cycle exceeded 1 year. 

     Currently, most of the Company's contracts are completed 
within one year, and therefore a classified balance sheet is 
meaningful.  As a result, the 1997 balance sheet has been 
reclassified to conform to the 1998 classified presentation.

RECENT ACCOUNTING PRONOUNCEMENTS:

     In June 1997, the Financial Accounting Standards Board (FASB) 
issued SFAS No. 130, "Reporting Comprehensive Income" and SFAS No. 
131, "Disclosures about Segments of an Enterprise and Related 
Information".  As specified by these Statements, the Company will 
apply these Statements beginning in Fiscal 1999 and reclassify the 
financial statements of earlier periods for comparative purposes.

     SFAS 130 establishes standards for reporting and display of 
comprehensive income and its components (revenues, expenses, 
gains, and losses) in a full set of general-purpose financial 
statements.  This Statement requires that all items that are 
required to be recognized under accounting standards as components 
of comprehensive income be reported in a financial statement that 
is displayed with the same prominence as other financial 
statements.

     SFAS 131 establishes standards for the way that public 
business enterprises report information about operating segments 
in annual financial statements and requires that those enterprises 
report selected information about operating segments in interim 
financial reports issued to shareholders.  It also establishes 
standards for related disclosures about products and services, 
geographic areas, and major customers.  This Statement supersedes 
FASB Statement No. 14, "Financial Reporting for Segments of a 
Business Enterprise," but retains the requirement to report 
information about major customers.  It amends FASB No. 94, 
"Consolidation of All Majority-Owned Subsidiaries," to remove the 
special disclosure requirements for previously unconsolidated 
subsidiaries.

     In February 1998 FASB issued SFAS 132, "Employers' 
Disclosures about Pensions and Other Postretirement Benefits - an 
amendment of SFAS No.'s 87, 88, and 106".  SFAS No. 132 revises 
employers' disclosure about pension and other postretirement 
benefit plans.

     In June 1998, FASB issued SFAS 133, "Accounting for 
Derivative Instruments and Hedging Activities".  SFAS No. 133 
establishes accounting and reporting standards for derivative 
instruments and for hedging activities.

     The Company has determined that there will be no material 
impact on the Company's financial position or results of 
operations from adoption of SFAS 130, SFAS 131, SFAS 132 and SFAS 
133.


1.  INVENTORY
<TABLE>
<CAPTION>
Inventory consisted of the following at July 31:

                                     1998             1997
                                 ----------       ----------
<S>                              <C>              <C>
Expendable tools and equipment   $  805,318       $  761,565
Supplies                            351,664          414,507
Materials                         1,407,017        1,551,742
                                 ----------       ----------
Total Inventory                   2,563,999        2,727,814
Less: amount classified
  as long-term                    1,243,754        1,264,997
                                 ----------       ----------
                                 $1,320,245       $1,462,817
                                 ==========       ==========
</TABLE>


2.  CONTRACT CLAIMS

     The Company maintains procedures for review and evaluation of 
performance on its contracts.  Occasionally, the Company will 
incur certain excess costs due to circumstances not anticipated at 
the time the project was bid.  These costs may be attributed to 
delays, changed conditions, defective engineering or 
specifications, interference by other parties in the performance 
of the contracts, and other similar conditions for which the 
Company believes it is entitled to reimbursement by the owner, 
general contractor, or other participants.  These claims are
recorded at the estimated net realizable amount after deduction of
estimated legal fees and other costs of collection.  Contract 
claims were zero and $534,025 as of July 31, 1998 and 1997, 
respectively.


3.  GAIN ON EXTINGUISHMENT OF DEBT

     During the year ended July 31, 1998, the Company recognized a 
"Gain on Extinguishment of Debt" in the amount of $809,000 arising 
from the ongoing liquidation of its subsidiary John F. Beasley 
Construction Company, under the auspices of the U.S. Bankruptcy 
Court for the Northern District of Texas.  This amount represents 
accounts payable which will not be paid under the Chapter 11 Plan 
confirmed by the court.  The finalization of the bankruptcy is not 
expected to have any further material impact on the Company's 
financial position, results of operations, or cash flows.

     The Company also recognized a "Gain on Extinguishment of 
Debt" in the amount of $119,000 for the year ended July 31, 1998 
relating to the liquidation of its Arthur Phillips and Company 
subsidiary.

     During the year ended July 31, 1997 and 1996 the Company 
recognized "Gain on Extinguishment of Debt" of $3,189,000 and 
$808,000 as the result of forgiveness of Bank Group Debt (see Note 
10).


4.  RELATED-PARTY TRANSACTIONS

     Certain shareholders owning or controlling approximately 17% 
of the stock of the Company at July 31, 1998, own approximately 
67% of the outstanding stock of Williams Enterprises of Georgia, 
Inc.  Billings to this entity and its affiliates were 
approximately $1,530,000 and $1,205,000 for the years ended July 
31, 1998 and 1997.  Billings to this entity and its affiliates 
were not significant for the year ended July 31, 1996.  Notes 
payable to this entity amounted to $48,000 and $100,000 at July 
31, 1998 and 1997.

     Certain shareholders owning or controlling approximately 17% 
of the stock of the Company at July 31, 1998, own 100% of the 
stock of the Williams and Beasley Company.  Net billings from this 
entity during the years ended July 31, 1998 and 1997 were 
approximately $181,000 and $436,000, respectively.  Billings from 
this entity were not significant for the year ended July 31, 1996.

     A shareholder owning or controlling approximately 17% of the 
stock of the Company at July 31, 1998, serves on the board of 
directors of Concrete Structures, Inc. (CSI), a former subsidiary 
of the Company, which filed for reorganization under Chapter 11 of 
the U.S. Bankruptcy Code on July 22, 1998.  During the years ended 
July 31, 1998, 1997, and 1996, billings to this entity by the 
Company were $154,000, $617,000, and $65,000.  At July 31, 1998 
approximately $305,000 was unpaid from CSI, against which the 
Company has provided a reserve for the portion which it believes 
is at risk of not being received.  In addition, at July 31, 1998, 
CSI was indebted to the Company for approximately $240,000 on a 
note secured by the assets of CSI.  CSI is in default on this 
note, however this default has not caused an impact to the 
Company's financial position since the note was fully reserved at 
the time it was issued.

     During the year ended July 31, 1998, the Company borrowed 
$75,000 from an officer, which was repaid.  The money was used to 
redeem one of the Company's convertible debentures that had been 
issued to the FDIC.

     Amounts owing to, or on account of, current and former 
directors of the Company amounted to $236,350 and $297,704 at July 
31, 1998 and 1997.


5.  CONTRACTS IN PROCESS
<TABLE>
<CAPTION>

     Comparative information with respect to contracts in process 
consisted of the following at July 31:

                                        1998           1997
                                    -------------  -------------
<S>                                 <C>            <C>
Expenditures 
  on uncompleted contracts          $ 15,255,899   $ 21,670,677

Estimated earnings                     4,258,377      7,984,347
                                    -------------  -------------
                                      19,514,276     29,655,024 
Less: Billings                       (20,733,419)   (31,782,286)
                                    -------------  -------------
                                    $ (1,219,143)  $ (2,127,262)
                                    =============  =============
Included in the accompanying 
  balance sheet
  under the following captions:
Costs and estimated earnings in
  excess of billings on
  uncompleted contracts             $    665,926   $    845,325
Billings in excess of costs and
  estimated earnings on 
  uncompleted contracts               (1,885,069)    (2,972,587)
                                    -------------  -------------
                                    $ (1,219,143)  $ (2,127,262)
                                    =============  =============
</TABLE>

     Billings are based on specific contract terms that are 
negotiated on an individual contract basis and may provide for 
billings on a unit price, percentage of completion or milestone 
basis.


6.  PROPERTY AND EQUIPMENT
<TABLE>
<CAPTION>

     Property and equipment consisted of the following at July 31:

                          1998                      1997
                          ----                      ----
                             Accumulated              Accumulated
                     Cost    Depreciation      Cost   Depreciation
                 -----------  ----------   -----------  ----------
<S>              <C>          <C>          <C>          <C>
Land and 
  buildings      $ 4,803,663  $1,562,604   $ 6,320,073  $2,052,366
Automotive
  equipment        1,974,331   1,357,120     1,585,188   1,140,321
Cranes and heavy
  equipment        9,435,468   4,605,789     9,312,084   4,469,639
Tools and
  equipment          809,462     693,357       798,024     658,399
Office furniture
  and fixtures       486,921     388,440       422,834     356,001
Leased property 
  under capital 
  leases             740,000     271,368       740,000     197,368
Leasehold
  improvements       816,641     476,665       895,195     513,061
                  ----------  ----------   -----------  ----------
                 $19,066,486  $9,355,343   $20,073,398  $9,387,155
                 ===========  ==========   ===========  ==========
</TABLE>


7.  NOTES AND LOANS PAYABLE
<TABLE>
<CAPTION>
     Notes and loans payable consisted of the following at July 
31:
                                            1998          1997
                                        -----------   -----------
<S>                                     <C>           <C>
Collateralized:

Loan payable to CIT/Credit
  Finance; collateralized by
  inventory, equipment and real
  estate; interest at prime
  + 2.5% (11.0% as of 7/31/98 and
  7/31/97) due 3/31/2000                 $2,053,384    $1,909,274

Loans payable to NationsBank;
  collateralized by real estate
  and certain other collateral not
  granted to CIT; interest at 
  11.0% fixed; due 4/30/1998                   -        2,492,497

Loans payable to Franklin National
  Bank; collateralized by real
  estate and certain other 
  collateral not granted to CIT;
  interest at 9.5% fixed; due
  4/30/2003                                 894,034          -

Obligations under capital leases;
  collateralized by leased property;
  interest from 10.2% to 13.4% for 1998
  and 8.0% to 11.0% for 1997
  payable in varying monthly or 
  quarterly installments                    408,682       409,174

Installment obligations; collateralized
  by machinery and equipment or real
  estate; interest from 2.9% to 15.2% 
  for 1998 and 7.9% to 18.0% for 1997; 
  payable in varying monthly installments 
  of principal and interest through 2008. 4,449,545     4,578,959

Industrial Revenue Bond; collateralized
  by a letter of credit which in turn 
  is collateralized by real estate; 
  principal payable in varying monthly 
  installments through 2007;
  variable interest based on
  third party calculations.               1,265,000     1,540,000


Unsecured:

NationsBank/FDIC (Bank Group):
  Convertible debentures;
  interest at prime plus 2.5%;
  principal payable on February 1,
  2001; convertible to 20% of the
  Company's outstanding and committed 
  stock after issuance.                        -          500,000

FDIC:  Convertible 
  debenture; non-interest bearing;
  principal payable on
  August 1, 1998;
  convertible to 110,294 
  common shares                                -           75,000

First Tennessee: Convertible
  subordinated debenture;
  interest at 10% to prime plus 1.5%;
  convertible to common stock of 
  the Company at the ratio of
  $1.43 per common share.                      -          100,000

Lines of credit, interest
  at 5.0% to 10.0% for 1998 and 
  prime to prime plus
  1.0% to 13.5% for 1997                    136,444       271,269

Installment obligations with 
  interest from 6.0% to 10.0% for 
  1998 and 7.3% to 13.5% for 1997; 
  due in varying monthly 
  installments of principal and 
  interest through 2005.                  1,097,648       761,883
                                        -----------   -----------
Total Notes Payable                     $10,304,737   $12,638,056
Notes Payable - Long Term                (8,357,119)   (7,356,813)
                                        -----------   -----------
Current Portion                         $ 1,947,618   $ 5,281,243
                                        ===========   ===========
</TABLE>

     Contractual maturities of the above obligations at July 31, 
1998 are as follows:
<TABLE>
<CAPTION>
Year Ended July 31:                 Amount
-------------------              -----------
     <S>                         <C>
      1999                       $ 1,947,618
      2000                         2,662,456
      2001                         1,252,101
      2002                           720,340
      2003                         1,510,419
      2004 and after               2,211,803
                                 -----------

      TOTAL                      $10,304,737
                                 ===========
</TABLE>

     See Note 10 for additional information concerning the 
obligations payable to The CIT Group/Credit Finance, Inc. (CIT), 
installment obligations collateralized by real estate and the 
Industrial Revenue Bond.   As of July 31, 1998, the fair value of 
the long term debt carried at $8,357,119 was estimated to be 
approximately $8,100,000.  The fair value of the Company's long 
term debt is based on management's estimate of current interest 
rates on similar debt with remaining maturities.  At July 31, 
1997, the carrying amounts reported above for notes and loans 
payable approximate their fair value based upon interest rates for 
debt currently available with similar terms and remaining 
maturities. 

     At July 31, 1998 the Company was in compliance with all 
restrictive covenants contained in the CIT credit facility, the 
Franklin National Bank real estate loan and the Wachovia Bank 
reimbursement agreement for the Industrial Revenue Bond.  Under 
the most restrictive of these covenants, the Company was required 
to (1) maintain a minimum net worth of $1.0 million at all times 
(2) maintain a current ratio greater than 1.0 at all times (3) 
maintain a fixed charge ratio, as defined, of 1.2X and 1.0X as of 
July 31, 1998 and 1997 (4) maintain a debt to tangible net worth 
of not greater 6.5:1, declining on a graduated scale to 3:1 at 
July 31, 2000.  Covenants also limit cash capital expenditures to 
$100,000 per year and do not allow for payment of cash dividends 
to shareholders.


8.  INCOME TAXES

     The provision for income taxes for the year ended July 31, 
1996 represents primarily a current state income tax provision 
related to states where the Company cannot file a consolidated or 
combined return.

     As a result of tax losses incurred in prior years, the 
Company at July 31, 1998 has tax loss carryforwards amounting to 
approximately $14 million.  Under SFAS No. 109, the Company is 
required to recognize the value of these tax loss carryforwards if 
it is more likely than not that they will be realized by reducing 
the amount of income taxes payable in future income tax returns.  
This in turn depends on projections of the Company's profitability 
in future years during the carryforward period.  As a result of 
the completion of the restructuring of the Company's Bank Group 
debt during 1997 and the return to profitable operations of the 
Company's ongoing businesses during the past three years, the 
Company expects to report profits for income tax purposes in the 
future.  As a consequence, the Company recognized a $0.9 million 
and $2.2 million portion of the benefit available from its tax 
loss carryforwards during the years ended July 31, 1998 and 1997,
respectively.

     Realization of this asset is dependent on generating 
sufficient taxable income prior to expiration of the loss 
carryforwards.  Although realization is not assured, management 
believes it is more likely than not that all of the recorded 
deferred tax asset will be realized.  The amount of the deferred 
tax asset considered realizable, however, could be reduced in the 
near term if estimates of future taxable income during the 
carryforward period are reduced.

     The differences between the tax provision calculated at the 
statutory federal income tax rate and the actual tax provision for 
each year are shown in the table directly below.
<TABLE>

                           1998          1997            1996
                        ----------   ------------    -----------
<S>                     <C>          <C>             <C>
Tax at statutory
  federal rate          $ 473,500    $   429,600     $  733,000
State income taxes         83,500         75,800        129,000
Change in valuation
  reserve                (900,000)    (2,221,400)      (799,500)
                        ----------   ------------    -----------
Actual income tax 
  (benefit) provision   $(343,000)   $(1,716,000)    $   62,500
                        ==========   ============    ===========
</TABLE>
<TABLE>
<CAPTION>
     The primary components of temporary differences which give 
rise to the Company's net deferred tax asset are shown in the 
following table.

As of July 31:                            1998           1997
                                     ------------   ------------
<S>                                  <C>            <C>
Deferred tax assets:
  Reserves & other nondeductible
accruals                             $   510,120    $   883,700
  Net operating loss & capital
    loss carryforwards                 5,180,000      6,618,100
Valuation reserve                     (2,538,120)    (5,175,000)
                                     ------------   ------------
Total deferred tax assets              3,152,000      2,326,800
                                     ------------   ------------
Deferred tax liability:
Property and equipment                  (623,600)    (   37,600)
Inventories                             (288,400)    (  489,200)
                                     ------------   ------------
Total deferred tax liability            (912,000)    (  526,800)
                                     ------------   ------------
Net deferred tax asset               $ 2,240,000    $ 1,800,000
                                     ============   ============
</TABLE>


9.  INVESTMENTS IN UNCONSOLIDATED AFFILIATES

<TABLE>
<CAPTION>
     Investments in unconsolidated affiliates consisted of the 
following at July 31:
<S>                                  <C>             <C>
                                         1998            1997
                                     ----------      ----------
Investment valued using the
  Equity Method
  S.I.P., Inc. of Delaware
    (42.5% owned)                     $ 979,769      $  960,269
Investment valued using the
  Cost Method
  Atlas Machine and Iron Works,
    Inc.(36.6% owned)                      -            810,671
                                     ----------      ----------
                                      $ 979,769      $1,770,940
                                     ==========      ==========
</TABLE>
     Atlas Machine and Iron Works, filed a voluntary bankruptcy 
petition in December 1996.  In the year ended July 31, 1997, the 
Company reduced the value of its investment in Atlas by $200,000 
due to the bankruptcy filing.  In the second quarter of the year 
ended July 31, 1998, the Company wrote off the remaining value of 
approximately $800,000 because of the liquidation of Atlas' assets 
by its secured creditors.  These amounts are included in "Equity 
in (loss) earnings of unconsolidated affiliates" in the 
accompanying Consolidated Statements of Earnings.  


10.  BUSINESS CONDITIONS AND DEBT RESTRUCTURING

     From the early 1990s through the year ended July 31, 1998, 
Williams Industries, Inc. underwent massive downsizing and debt 
restructuring.  Included in these events were:     

Bank Group Debt

     The restructuring of the Bank Group Debt was concluded as of 
March 31, 1997 with the execution of agreements between the 
Company, representatives of the Company's Bank Group, and CIT.  
Funding of the transactions occurred on April 2, 1997.  The 
following is a summary of the transactions which enabled the 
closing to occur:

     CIT: The Company entered into a Loan and Security Agreement 
with CIT for a credit facility of approximately $3 million.  This 
loan requires monthly principal payments as well as interest at 
prime plus 2.5%.  Payments began on May 1, 1997 and are due on the 
first of each month.  The loan has a three year term.  This loan 
is secured by the Company's equipment and receivables as well as 
subordinate deeds of trust on the Company's real estate.

     At closing, the Company received an advance of $2.5 million 
from the CIT credit facility.  These funds, in addition to funds 
already paid to the Bank Group, were used to pay the balance of 
Bank Group Debt and other outstanding past due obligations of the 
Company.  As of July 31, 1998, approximately $2.1 million was due 
on the CIT credit facility.
  
     NationsBank/FDIC:  The restructuring of the Bank Group Debt 
was concluded and all related debt forgiveness granted.  The debt 
forgiveness is reflected in the Company's consolidated financial 
statements for the year ended July 31, 1997 as "Gain On 
Extinguishment of Debt".  In connection with the debt forgiveness, 
the Company issued $500,000 of convertible debentures.  All 
debentures issued as a result of this transaction were redeemed or 
converted during the year ended July 31, 1998.  

     NationsBank: In the final restructuring of the Bank Group 
Debt, the Bank Group and Real Estate loans were combined and the 
combined balance was reduced to $2.5 million as of March 31, 1997. 
The combined loan was secured by first deeds of trust on all the 
Company's real property (with the exception of the Richmond 
facility encumbered by the Industrial Revenue Bond), and by 
certain other collateral not granted to CIT to secure the 
Company's new loan.  The combined loan had a fixed interest rate 
of 11% per annum, and required payments based on a 20 year 
amortization.  The combined loan was refinanced with Franklin 
National Bank on April 30, 1998.

     Pribyla: In order to obtain the CIT loan, the Company was 
required to reach agreement on several outstanding legal issues.  
Most of the necessary settlements occurred in the first and second 
quarter of the year ended July 31, 1997, but a settlement with Mrs.
Karen Pribyla and the estate of Mr. Eugene Pribyla, regarding 
claims for excess medical expenses, coincided with the Bank Group 
closing.  Under the Company's settlement with Pribyla, the Company 
issued a promissory note in the face amount of $744,000 which does 
not bear interest but allows a prepayment discount at a 10% annual 
rate.  This note is secured by subordinate deeds of trust on the 
Prince William County, Virginia real estate.   The Company also paid
$205,000 in cash and issued 215,000 shares of the Company's common 
stock in the settlement.  The Company has recorded this note at 
its present value considering the effects of the pre-payment 
clause.

Real Estate Loan

     On April 30, 1998, the Company closed a transaction regarding 
its loan from NationsBank with the assignment and modification of 
the balance to Franklin National Bank of Washington, DC.  The 
transaction resulted in the interest rate being reduced from a 
fixed interest rate of 11% to 9.5%, with monthly payments 
calculated on a fifteen year amortization and a balloon payment 
due and payable on April 30, 2003.  As of July 31, 1998, the 
balance of the loan was approximately $894,000.

Industrial Revenue Bond 

     In the year ended July 31, 1998, the Company entered into a 
First Amendment to Reimbursement Agreement with Wachovia Bank 
(formerly Central Fidelity National Bank) for a three-year renewal 
of the Letter of Credit backing the Industrial Revenue Bond (IRB) 
secured by the Company's Richmond manufacturing facility.  All 
obligations under the IRB are current and the Company is in 
compliance with the covenants contained in the agreement.  As of 
July 31, 1998, the outstanding balance was approximately $1.27 
million. Principal payments are due in increasing amounts through 
maturity.  A portion of the secured property is leased to a non-
affiliated third party.  
 

11.  DISPOSITION OF ASSETS

     In January 1998, the Company sold its 2.25 acre headquarters 
property in Fairfax County, Virginia to a non-affiliated third 
party for $1,430,000.  The Company also entered into a lease for 
several buildings on the property.  The transaction resulted in a  
gain of approximately $560,000,of which $254,000 is included in 
"Other Income" in the Consolidated Statements of Earnings for the 
year ended July 31, 1998.  While $560,000 of gain was recognized 
in the financial statements for the quarter ended January 31, 
1998, the Company subsequently determined in accordance with SFAS 
98, "Accounting for Leases/Sale-Leaseback Transactions Involving 
Real Estate," that at January 31, 1998 and July 31, 1998, $360,000 
and $306,000, respectively, should be deferred.  The deferred 
amount is being recognized over the remaining lease term.

     In June 1998, the Company sold its one acre property in 
Baltimore, Maryland to a non-affiliated third party for $135,000.  
The transaction resulted in a gain of approximately $98,000 which 
is also included in "Other Income" in the Consolidated Statement 
of Earnings for the year ended July 31, 1998.

     For the years ended July 31, 1998 and 1997, the Company sold 
several large pieces of equipment in order to modernize its fleet 
and pay off debt.  Net gain of approximately $224,000 and 
$540,000, respectively, was recognized.  The gain from these 
transactions is included in "Revenue: Construction" in the 
Consolidated Statement of Earnings. 
     
     During the year ended July 31, 1997 the Company sold an 
office building on the Richmond property which was part of the 
real estate encumbered by the IRB.  The proceeds from this 
$210,000 sale were used to pay obligations related to the IRB.

     Also during the year ended July 31, 1997, the Company's 
subsidiary, John F. Beasley Construction Company, which was 
liquidating its assets under Chapter 11 of the Bankruptcy Code, 
sold its remaining two acres in Dallas, Texas and its two acre 
parcel in Muskogee, Oklahoma, to an unaffiliated third party for 
$90,000.  The sales were approved by the U.S. Bankruptcy Court and
produced a loss of approximately $4,000.

     In the year ended July 31, 1996, the Company sold: 

  (1)  Six acres owned by the John F. Beasley Construction Company 
in Dallas, Texas, together with certain other assets, to an 
investment group owned by Frank E. Williams, Jr., and John M. 
Bosworth.  Mr. Williams, Jr. is a current director and former 
officer of the Company and the former chairman of Beasley.  Mr. 
Bosworth is the former President of the Beasley Building Division.  
Two acres owned by Beasley in Dallas, Texas, were sold to a 
neighboring property owner not affiliated with the Company.   The 
sales prices were approved by the Bankruptcy Court.  A provision 
for the loss of approximately $260,000 from the sale of these 
assets was recorded during the year ended July 31, 1995.  

  (2)  Approximately 5.5 acres of its property in Bedford, 
Virginia to a non-affiliated party for $50,000.

  (3)  Some of its real estate in Prince William County, Virginia, 
for $2.6 million.  The sale resulted in a net gain of 
approximately $2.2 million, included in "Other Income" in the 
Consolidated Statement of Earnings for the Year Ended July 31, 
1996.

  (4)  Miscellaneous small tools and consumables owned by Williams 
Enterprises to a non-affiliated buyer for approximately $75,000.  
The proceeds were used to pay Bank Group debt.

  (5)  A crane for approximately $150,000.


12.  COMMON STOCK OPTIONS

     Until November 1996, the Company had an Incentive Stock Option 
Plan (1990 Plan) which provided that key employees could be 
awarded incentive stock options.  On October 20, 1990, the Company 
granted 33,000 Incentive Stock Options to key employees at the 
fair market value of $5.75 per share.  None of the options were 
exercised within the five year limitation of the grant and all 
expired during the year ended July 31, 1996.

     At the November 1996 annual meeting, the shareholders 
approved the establishment of a new Incentive Stock Option Plan 
(1996 Plan) to provide an incentive for maximum effort in the 
successful operation of the Company and its subsidiaries by their 
officers and key employees and to encourage ownership of the 
common shares of the Company by those persons.  Under the 1996 
Plan, 200,000 shares were reserved for issue.  

     In May, 1998, the Company's Board of Directors authorized 
options for 12,000 shares of stock to subsidiary management under 
the Company's 1996 Plan and 12,000 shares of non-incentive stock 
options to the non-management members of the Company's Board of 
Directors.  

     The stock option exercise prices were at quoted market value 
to 110% of quoted market value on the date of the grant.  Since 
the Company accounts for its options under the intrinsic method of 
APB No. 25, no compensation expense has been recognized for the 
incentive stock option grants.  Had compensation expense for the 
Company's stock-based compensation plans been determined based on 
the fair value at grant dates for awards under those plans, 
consistent with the method of accounting under SFAS No. 123, 
"Accounting for Stock-Based Compensation", the Company's net 
earnings and earnings per share would have been:
<TABLE>
                              1998          1997          1996
                           ----------    ----------    ----------
<S>                        <C>           <C>           <C>
Net earnings
     As reported           $1,847,740    $6,171,512    $2,960,847
     Pro forma              1,823,980     6,171,512     2,960,847

Earnings per share - Basic
     As reported              $ 0.57        $2.33         $1.15      
     Pro forma                  0.57         2.33          1.15
</TABLE>

     The weighted average exercise price and weighted average fair 
value for options granted during the year ended July 31, 1998, for 
stock options where exercise price was less than, equal to, or 
exceed the market price of the Company's stock were as follows:
<TABLE>
                                              Weighted   Weighted
                                               Average    Average
                                              Exercise     Fair
                                                Price     Value
                                              --------   --------
<S>                                            <C>        <C>
Exercise Price is less than market price          -          -
Exercise Price is equal to market price         $4.25      $3.22
Exercise price is greater than market price      4.68       3.54
</TABLE>

The fair value of each option is estimated on the date of grant 
using the Black-Scholes option-pricing model with the following 
assumptions:
<TABLE>
     Year ended July 31,                      1998
                                           ----------
     <S>                                      <C>
     Dividend yield                            0.0%
     Volatility rate                          53.0%
     Discount rate                             5.6%
     Expected term (years)                      5
</TABLE>

     The Black-Scholes option valuation model was developed for 
use in estimating the fair value of traded options which have no 
vesting restrictions and are fully transferable.  In addition, 
option valuation models require the input of highly subjective 
assumptions including the expected stock price volatility.  
Because the Company's employee stock options have characteristics 
significantly different from those of traded options, and because 
changes in the subjective input assumptions can materially affect 
the fair value estimate, in management's opinion, the existing 
models do not necessarily provide a reliable single measure of the 
fair value of its employee stock options.

     Stock option activity and price information follows:
<TABLE>
                                                        Weighted
                                                         Average
                                            Number      Exercise
                                          of shares       Price
                                          ---------     --------
<S>                                       <C>           <C>
Shares under option, August 1, 1995         33,000        $5.75
     Granted                                  -             -
     Exercised                                -             -
     Forfeited                              33,000         5.75
                                            ------
Shares under option, July 31, 1996            -             -
     Granted                                  -             -
     Exercised                                -             -
     Forfeited                                -             -
                                            ------
Shares under option, July 31, 1997            -             -
     Granted                                24,000         4.30
     Exercised                                -             -
     Forfeited                                -             -
                                            ------
Shares under option, July 31, 1998          24,000         4.30
                                            ======
Options exercisable, July 31, 1998          24,000         4.30
                                            ======
</TABLE>

13.  SEGMENT INFORMATION
<TABLE>
<CAPTION>
     Information about the Company's operations in different 
industries for the years ended July 31, is as follows:

                             1998          1997          1996 
                          ------------  ------------  ------------
<S>                       <C>           <C>           <C>
Revenue:
  Construction            $19,772,679   $24,068,633   $18,121,379
  Manufacturing            10,271,987    11,203,684    10,287,072
  Other revenue               783,765       945,186       963,611
                          ------------  ------------  ------------
                           30,828,431    36,217,503    29,372,062
Inter-company revenue:
  Construction             (1,857,974)   (1,681,157)   (1,989,845)
  Manufacturing               (66,298)     (227,827)    ( 224,705)
                          ------------  ------------  ------------
  Total Revenue           $28,904,159   $34,308,519   $27,157,512
                          ============  ============  ============
Operating profits (Loss):
  Construction              2,341,387   $ 2,364,087   $ 1,682,454
  Manufacturing                75,398       (58,758)      120,788
                          ------------  ------------  ------------
Consolidated
  Operating Profits         2,416,785     2,305,329     1,803,242
General corporate 
  income, net                  85,359       764,932     1,863,457
Interest expense           (1,148,952)   (1,606,575)   (1,510,985)
                          ------------  ------------  ------------
Corporate earnings
  before income taxes     $ 1,353,192   $ 1,463,686   $ 2,155,714
                          ============  ============  ============
Assets:
  Construction             15,730,074  $ 15,878,023   $14,303,853
  Manufacturing             6,061,299     6,324,220     6,342,351
  General corporate         7,321,822     9,287,476     7,365,548
                          ------------  ------------  ------------
  Total Assets            $29,113,195   $31,489,719   $28,011,752
                          ============  ============  ============
Capital expenditures:
  Construction            $   895,905   $ 2,402,672   $ 2,880,325
  Manufacturing               424,668       314,083       113,651
  General corporate            68,774        26,570        21,295
                          ------------  ------------  ------------
  Total 
  Capital expenditures    $ 1,389,347   $ 2,743,325   $ 3,015,271
                          ============  ============  ============
Depreciation and 
    Amortization:
  Construction            $   923,501   $   774,559   $   660,250
  Manufacturing               161,347       132,548       137,922
  General corporate           136,611       172,575       186,490
                          ------------  ------------  ------------
  Total Depreciation 
    and Amortization      $ 1,221,459   $ 1,079,682   $   984,662
                          ============  ============  ============
</TABLE>
     The Company and its subsidiaries operate principally in two 
segments within the construction industry; construction and 
manufacturing.  Operations in the construction segment involve 
structural steel erection, installation of steel and other metal 
products, installation of precast and prestressed concrete 
products, and the leasing and sale of heavy construction 
equipment.  Operations in the manufacturing segment involve 
fabrication of steel plate girders, rolled beams, and light 
structural metal products.

     Operating profit is total revenue less operating expenses.  
In computing operating profit (loss), the following items have not 
been added or deducted:  general corporate expenses, interest 
expense, income taxes, equity in the earnings (loss) of 
unconsolidated affiliates and minority interests.

     Identifiable assets by segment are those assets that are used 
in the Company's operations in each segment.  General corporate 
assets include investments, some real estate, and other assets not 
allocated to segments.

     The majority of revenues have historically been derived from 
projects on which the Company is a subcontractor of a material 
supplier, other contractor or subcontractor.  Where the Company 
acts as a subcontractor, it is invited to bid by the firm seeking 
construction services or materials; therefore, continuing 
favorable business relations with those firms that frequently bid 
on and obtain contracts requiring such services or materials are 
important to the Company.  Over a period of years, the Company has 
established such relationships with a number of companies.  During 
the years ended July 31, 1997, and 1996, no single customer 
accounted for more than 10% of consolidated revenue; however, 
during the year ended July 31, 1998, one single customer accounted 
for 10.4% of consolidated revenue and 13.4% of the construction 
revenue.


14.  EMPLOYEE BENEFIT PLAN

     The Company has a defined contribution retirement savings 
plan covering substantially all employees.  The Plan provides for 
optional Company contributions as a fixed percentage of salaries.  
Effective January 1, 1998, the Company began contributing 2% of 
each eligible employee's salary.


15.  COMMITMENTS AND CONTINGENCIES

Industrial Revenue Bond     

     On September 1, 1997, the Company entered into a First 
Amendment to Reimbursement Agreement with Wachovia Bank (formerly 
Central Fidelity National Bank) for a three-year renewal for the 
Letter of Credit backing the Industrial Revenue Bond issue on the 
Company's Richmond manufacturing facility.  All obligations under 
the IRB are current and the Company is in compliance with the 
covenants contained in the agreement.  As of July 31, 1998, the 
debt was approximately $1.27 million and it is secured by the real 
estate in the City of Richmond. Principal payments are due in 
increasing amounts through 2007.  A portion of the property 
covered by the Industrial Revenue Bond is leased to a non-
affiliated third party.  

Precision Components Corp.

     The suit by Industrial Alloy Fabricators, Inc. and Precision 
Components Corp. against the Company and IAF Transfer Corporation, 
sought $300,000 plus interest and fees arising from a product 
liability claim against the Company.  The Company received a 
favorable decision in this case, and judgment in favor of the 
Company was entered on March 4, 1998 by the Circuit Court for the 
City of Richmond.  The plaintiffs have perfected an appeal to the 
Virginia Supreme Court, which the Court accepted on September 21, 
1998.  It is expected the case will be argued early in 1999.  
Management believes that the ultimate outcome of this matter will 
not have a material adverse impact on the Company's financial 
position, results of operations or cash flows.

General

     The Company is party to various other claims arising in the 
ordinary course of its business.  Generally, claims exposure in 
the construction services industry consists of workers 
compensation, personal injury, products' liability and property 
damage.  The Company believes that its insurance accruals, coupled 
with its liability coverage, is adequate coverage for such claims. 


Falls Church Property

     At the time of the sale of the Falls Church, Virginia 
property, January 28, 1998, the Company entered into a lease-back 
arrangement for three buildings in the complex.  Maximum future 
lease payments for the Falls Church property are approximately 
$132,000, $135,000, and $92,000 for the years ending July 31, 
1999, 2000, and 2001, respectively.  The agreement provides that 
the landlord may cancel with six months notice to the Company.

Leases

     The Company leases certain property, plant and equipment 
under operating lease arrangements that expire at various dates 
though 2011.   Lease expenses approximated $580,000, $278,000, and 
$90,300 for the years ended July 31, 1998, 1997, and 1996, 
respectively.  At July 31, 1998, future minimum lease commitments 
required under non-cancelable leases were as follows:

<TABLE>
Year Ending July 31:                         Amount
-------------------                       ----------
     <S>                                  <C>
     1999                                   $742,000
     2000                                    744,000
     2001                                    654,000
     2002                                    529,000
     2003                                    529,000
     Thereafter                           $1,628,000
</TABLE>

16.  SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

     During the years ended July 31, 1998, 1997 and 1996, the 
Company entered into several financing agreements by issuance of 
notes payable to acquire assets with a cost of $442,000, 
$1,882,000 and $2,091,000, respectively.  These amounts are not 
included in the accompanying Consolidated Statements of Cash 
Flows because the proceeds went directly to the seller of the 
assets.

     During the years ended July 31, 1998, 1997 and 1996, the 
Company issued stock bonuses in lieu of cash bonuses to certain 
officers.  The number of shares issued for this purpose were 
36,363, 22,000, and 35,000 respectively.

     During the year ended July 31, 1998, the Company redeemed two 
convertible debentures with a carrying value of $165,000.  Also, 
the Company issued 690,697 shares upon conversion of two 
convertible debentures with a carrying value of $510,000.  During 
the year ended July 31, 1997 the Company issued 215,000 shares in 
connection with the Pribyla settlement that had a carrying value 
of approximately $316,000.

<TABLE>
                       
Cash paid during
  the year ended July 31:   1998           1997          1996
  for:                   ----------     ----------    ----------
    <S>                  <C>            <C>           <C>
    Income taxes         $   45,800     $   72,000    $   16,500
                         ----------     ----------    ----------
    Interest             $1,123,982     $1,268,683    $1,062,171
                         ----------     ----------    ----------
</TABLE>

17.  SUBSEQUENT EVENTS

     Subsequent to July 31, 1998, the Company received a 
commitment from The CIT Group/Credit Finance, Inc. to extend the 
maturity on its loan to March 31, 2001.  Formal documentation of 
this commitment is in process.  

     In addition, the Company agreed to sell approximately four 
acres of its Bedford, Virginia property to a non-affiliated third 
party for $40,000.


18.     EARNINGS PER SHARE

     In March 1997, the Financial Accounting Standards Board 
issued SFAS No. 128, "Earnings Per Share" (EPS) which simplifies 
the standards for computing EPS previously found in Accounting 
Principles Board Opinion No. 15 and makes them comparable to 
international EPS standards.  The Statement is effective for 
financial statements issued for periods ending after December 15, 
1997.  The Company adopted this statement during the year ended 
July 31, 1998.  The 1997 and 1996 earnings per share are restated 
to conform to the new presentation.

<TABLE>
     Year ended July 31,          1998        1997        1996
                                 -----       -----       -----
     <S>                         <C>         <C>         <C>
     EPS-basic                   $0.57       $2.33       $1.15
     EPS-diluted                  0.52        2.13        1.12
</TABLE>
<TABLE>
<CAPTION>
The following is a reconciliation of the amounts used in 
calculating the basic and diluted earnings per share:

                                   1998        1997        1996
                                ---------   ---------   ---------
<S>                             <C>         <C>         <C>
Earnings (Numerator)
 Net earnings - basic          $1,847,740  $6,171,512  $2,960,847
 Interest expense
    on convertible debentures      76,683     269,669        - 
                                ---------   ---------   ---------
 Net earnings - diluted        $1,924,423  $6,441,181  $2,960,847
                                =========   =========   =========
Shares (Denominator)
 Weighted average shares 
  outstanding - basic           3,214,117   2,649,872   2,565,725
 Effect of dilutive securities:
  Options                             410        -          7,792
  Convertible debentures          486,733     378,717      69,930
                                ---------   ---------   ---------
Weighted average shares
    outstanding - diluted       3,701,260   3,028,589   2,643,447
                                =========   =========   =========

</TABLE>


<TABLE>
<CAPTION>
Williams Industries, Inc.

Schedule II - Valuation and Qualifying Accounts
Years Ended July 31, 1998, 1997 and 1996

Column A          Column B       Column C            Column D       Column E
--------          --------   -------------------     ---------      ---------
                                  Additions
                             -------------------
                                        Charged
                Balance at  Charged to  to Other                   Balance 
                 Beginning   Costs and  Accounts-   Deductions-    at End of
Description      of Period   Expenses   Describe    Describe        Period
<S>              <C>        <C>      <C>           <C>            <C> 
July 31, 1998:
  Allowance for
    doubtful
    accounts     $  758,141 $  1,017  $757,597(3)  $  (16,889)(1)  $1,211,128
                                                     (288,738)(2)

July 31, 1997:
  Allowance for 
    doubtful 
    accounts        953,921   60,246   293,000(3)   (212,867)(1)      758,141
                                                    (336,159)(2)  

July 31, 1996:
  Allowance for 
    doubtful 
    accounts      1,633,566  243,885   246,410(3)    (19,944)(1)      953,921
                                                  (1,149,996)(2)  

</TABLE>
(1) Collection of accounts previously reserved.

(2) Write-off from reserve accounts deemed to be uncollectible.

(3) Reserve of billed extras charged against corresponding revenue account.

</PAGE>


SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.

                             WILLIAMS INDUSTRIES, INCORPORATED

October 14, 1998                /s/  Frank E. Williams, III
                                Frank E. Williams, III   
                                President, Chairman of the
                                Board
                                Chief Financial Officer