SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, D.C. 20549

                                   FORM 10-KSB

      (Mark One)

      [  X  ] ANNUAL REPORT  PURSUANT TO SECTION 13 OR 15 (d) OF THE 
       SECURITIES EXCHANGE ACT OF 1934  (FEE REQUIRED)

      For the fiscal year ended:  October 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
                           Commission file number 0-2401

                                   WILTEK, INC.
                  (Name of small business issuer in its charter)

          CONNECTICUT                                        06-0625999
   (State or other jurisdiction of                       (I.R.S. Employer 
    incorporation or organization)                       Identification No.)

    542 WESTPORT AVE., NORWALK, CT                             06851 
(Address of principal executive offices)                     (Zip Code)
                                 (203) 853-7400
                          (Registrant's telephone number)
            Securities registered pursuant to Section 12(b) of the Act:

                                                    Name of each exchange on
           Title of each class                          which registered 
                  None                                         None 

          Securities registered pursuant to Section 12(g) of the Act:
                           COMMON STOCK,  NO PAR VALUE
                                (Title of class)
     Check whether the issuer (1) filed all reports required to be filed 
by Section 13 or 15(d) of the Exchange Act during the past 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  ( )
     Check if there is no disclosure of delinquent filers in response to 
Item 405 of Regulation S-B is not contained in this form, and no disclosure
will 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-KSB or any amendment to this Form 10-KSB.  ( )

    The issuer's revenue for its most recent fiscal year was $7,584,300

The aggregate market value of the voting stock held by non-affiliates of
the registrant as of December 29, 1998 was: $1,491,890


                   THE ISSUER WAS NOT INVOLVED IN BANKRUPTCY
                    PROCEEDINGS DURING THE PAST FIVE YEARS

As of December 29, 1998, there were 3,892,128 shares of Common Stock, No Par
Value outstanding.

                       DOCUMENTS INCORPORATED BY REFERENCE

     Information with respect to Directors, Management Remuneration and 
Security Ownership of Certain Beneficial Owners and Management are contained
in the Company's Proxy Statement for the 1998 Annual Meeting of Stockholders
and incorporated by reference in Part III



























Wiltek, Inc.
                                  Form 10-KSB


                                    PART I

Item 1.  Business


General

Wiltek, Inc., (Wiltek or the "company") is a Connecticut corporation, which 
was organized in 1947.  The company's principal offices are located at 542
Westport Avenue, Norwalk, CT  06851.  Wiltek (UK) Ltd. is a wholly owned
subsidiary, which was organized in England in 1983, to provide Wiltek
services to international users.  Wiltek (UK) Ltd. is located at 2 Apple 
Walk, Swindon, England.

Wiltek provides outsourcing connectivity services to companies migrating 
between or coexisting with multiple disparate messaging platforms.  Wiltek
performs all design required for the implementation and operation of its
worldwide message and data communication services.  These services enable
Wiltek's customers to seamlessly communicate with electronic mail, among all 
intra- and inter-company messaging systems both private and public.  All 
issues of incompatible applications, systems, platforms, networks, protocols
and formats are eliminated for Wiltek's customers and their respective 
trading partners.

An important feature provided to Wiltek's customers is directory 
synchronization.  Wiltek's directory synchronization services enable 
customers' multiple internal messaging systems to have all user 
address information presented in a complete, native format to all 
participating systems.  This service feature also allows external trading 
partner systems to participate in the directory synchronization process. 

Wiltek has developed a range of services, which allow customers to:

  1. Connect dissimilar computer based electronic mail systems such as 
IBM PROFS (r), Digital Equipment All-In-One (r), Microsoft Exchange (r) and 
Microsoft Mail (r), Lotus Notes (r) and cc:Mail (r), Groupwise, POP3, 
IMAP4, SMTP, etc.  Generally these systems operate within different 
divisions of the same company or in the customers' trading partner 
facilities.
 
  2. Communicate with public email services (AT&T Mail (r), MCI Mail (r),
Advantis (IBMMail(r)), Mercury, the Internet and X.400 services to allow
users of host-based and client/server systems to correspond with email users
outside of their company.
 
  3. Send to facsimile devices located throughout the world utilizing our
broadcast and customized facsimile delivery service based in the US and UK.

In addition to the communication and directory synchronization services
described above, Wiltek has also developed a consulting and system
integration organization.  This unit is chartered to assist 
customers in the movement to Microsoft's client/server based electronic
messaging and workgroup systems.  Wiltek is focusing on accounts that
require assistance in the planning for, and implementation of, Microsoft
Exchange(r), Windows NT, IIS, SMS and SNA Server.  Wiltek is a Microsoft
Solution Provider and is firmly committed to the Microsoft Backoffice(r)
product line.

Microsoft has established itself, as the growth arena for business 
information systems needs.  This growth is the direct result of marketing
strategies and product deliverables planned and recently executed by
Microsoft.  The sales and support strategy deployed by Microsoft for 
business clients are dependent upon the use of value added consulting 
services by Solution Providers.  The basis for the Microsoft Backoffice(r)
suite of products is messaging technology.

1997 marked the initial large growth phase of Microsoft provided intranets,
based on the availability of products required by enterprise corporate
computing models.  This trend continued in 1998 as wide-spread 
implementation of Microsoft NT(r) server and Microsoft Exchange(r) server 
based collaborative computing systems increased dramatically.  The corporate
information systems model requires the availability of decision-making data,
open communications, and technology resource based marketing and operating
advantages.  Wiltek also provides software engineering via our consulting
organization to design and develop workflow and routing applications and
forms.

Within the realm of messaging based technologies, use of messaging (email,
fax and directory services) has become a standard operating procedure for
successful large and medium organizations.  During 1997, small organizations
were just beginning to establish business requirements for these
applications, however, the technology cost and benefit for small 
organizations did not yet fit the profile of an attractive market.  During 
1998, small organizations, and to a degree the "Small Office Home Office" 
(SOHO) market, began limited implementation and leveraging of collaborative
computing tools.  This trend should continue during 1999 as technology costs
continue to decline and technology ease-of-use increases. This will lead to
use and acceptance of collaborative computing technologies across a much 
wider business market.  Wiltek by way of its experience and expertise is
positioned solidly in the middle of these growth markets.


Wiltek's Market

The market for Wiltek's electronic mail connectivity services is a result of
the explosive growth in the installation of email systems throughout the 
world.  In its broadest sense, electronic mail or messaging includes the
electronic communication between individuals who use mainframe computers,
mid-range systems, client/server platforms, personal computers, public
electronic mail, facsimile or telex machines to send and/or receive
information.  The primary information type communicated via electronic mail
was once text created by individuals.  Today, the more prevalent information
profiles include attached files created by computer based applications such
as spreadsheets, database segments, executable code, video and audio clips 
and formatted documents such as purchase orders.  This trend is indicative 
of the gradual, yet inevitable movement towards unified messaging.

The other important segment of Wiltek's market is the need to collect text 
and attached files from email users or from computer based data files and
deliver this information to facsimile machines.  This market (sometimes
referred to as "desktop-to-fax") has grown dramatically with the worldwide
acceptance and use of services for broadcast distribution of application and
email generated information destined for facsimile delivery.  Application
information includes spreadsheets, word documents, images, etc. sent
as attachments by the user communities and computer based applications.


The growth in the installed base of email systems and facsimile devices
represents a significant opportunity for providers of gateway or
connectivity software and services.  Every time an email document or 
attached file needs to move from one type of system to a different system,
computer or device; it will require some or all of the following
translations:

1. Protocol conversion to change the transmission method, e.g. from an 
IBM SNA(r) protocol to the TCP/IP protocol.
 
2. Format conversion to accommodate the different structures of each 
email system, e.g. IBM PROFS(r) to Microsoft Exchange(r).
 
3. Transmission speed conversion because the sending systems operate at 
different transmission speeds than the receiving devices.
 
4. Code conversion to convert from one encoding standard to another, e.g. 
ASCII to EBCDIC.
 
5. Directory synchronization to transform an individual id or name on one 
system into a native appearance on another system.  For example, a user's 
name on Microsoft Exchange might be "Jay W. Fitzpatrick" but on a PROFS 
system the name is limited to 8 characters and therefore might be presented
to the PROFS user community as "JWFITZFP."

Organizations who use electronic mail have the option of buying hardware and
software, which they install and operate, or to connect their different
systems to a service provider like Wiltek to perform the functions outlined
above.  The magnitude of the market for these connectivity capabilities has
grown as a result of the following factors:

1. The increased size of the email and fax installed base.
 
2. The number of companies using email is no longer limited to large
corporations.
 
3. The growing use of email systems as a transport vehicle.
 
4. Corporations are moving from large, mainframe based computers to PC's,
LANs, and client/server platforms.
 
5. The need to synchronize directories of users among dissimilar systems has
been more clearly recognized.

6. The use of email has grown from an intra-enterprise application to one 
that crosses company boundaries to trading partners, i.e. suppliers and
customers.

7. Further acceptance of the outsourcing model.

While many organizations have, or are in the process of standardizing 
singular messaging systems, opportunities continue to exist for service
providers.  Wiltek will continue to pursue such service-based
opportunities in 1999 including application management, gateway management
and outsource messaging and directory management.


Marketing Strategy and Target Customers

The company has traditionally targeted large multi-national companies that 
are likely to have dissimilar computer systems and applications in multiple
locations.  Such companies have been plagued with inter-divisional
communication problems because their computing strategies often differed 
from division to division, resulting in computing systems that communicate
ineffectively with each other.  Wiltek's customer list contains over 50
large corporations, most of which are Fortune 500 companies.

As a result of the development by Wiltek of LAN connectivity and Directory
Synchronization services, as well as Microsoft BackOffice(r) related
consulting services the company's potential market is expanding.  Large
corporations who are migrating from mainframe computers to LAN and client/
server based systems need significantly more connectivity between the older
legacy systems and the new client/server messaging and collaborative
systems.To facilitate the transmission of messages and files between those
disparate messaging systems, users are requiring directory services that
incorporate the addresses of all of the users on other systems into their
individual local directories.  Wiltek provides this process, known as
Directory Synchronization.  In addition, the lower cost of hardware and 
software for electronic messaging has broadened the base of users from 
large, international corporations (typically the top 1,000 companies) to 
the much larger market represented by mid-size and small companies.  The 
downsizing of staff in many organizations and the relatively unsophisticated
technical capabilities of smaller companies also enhances the attractiveness
of using an outsourcing service like Wiltek rather than an in-house managed
hardware/software solution.


New Services and Products

Wiltek's research and development activities are directed toward enhancing
existing services and creating new services to meet customers' data
communication needs.  The company's research and development primarily
involves the creation of computer software and the customization and 
integration of purchased software.  The company's efforts are generally 
customer driven.  As new requirements arise, Wiltek develops new software or
adapts existing software to provide a solution.

The company has recently installed new client/server communications 
applications to enhance our service capabilities within the rapidly growing
client/server messaging segment of the market.  In addition, the company has
installed both UNIX and NT based solutions to provide X.500 Directory 
Services to its customers.

An additional feature added to our facsimile delivery service is the ability
to accept and deliver a customer's message text and attachments natively from
 their electronic messaging platform.  This service enhancement allows
customers to send faxes natively from Lotus Notes(r), Lotus cc: Mail(r), 
Groupwise(r), Microsoft Mail Exchange(r), Microsoft Mail(r), etc.  This 
solution does not require additional hardware or software; it simply allows
customer's to send faxes as if they were sending a mail item and
attachment(s) to another mail user.  All document conversions are 
transparent to the customer and are performed by the Wiltek Facsimile 
delivery service.  Supported attachments include MS Word(r), MS Excel(r), MS
Power Point(r), Word Perfect 5.0(r), Word Perfect 5.1(r) for DOS, Word 
Perfect 5.x for Windows(r), Lotus 123(r), Lotus Freelance Graphics(r), Lotus
AmiPro(r), TIFF, BMP, GIFF, JPEG, RTF, HTML, and PostScript.

Wiltek Services also provides their customers in both large organizations 
and the SOHO market with the ability to transmit messages and file 
attachments into Wiltek Services via the Internet.  Wiltek Services receives
these mail items with file attachments and automatically converts them into
faxable images prior to transmitting to the intended facsimile recipients.
Any organization with Internet access can be authorized for Wiltek Services
access within a matter of hours.

During 1998, Wiltek also implemented a Fax-to-email Service offering 
available to any organization with Internet access.  Wiltek Services 
receives facsimile transmissions from any fax machine around the globe and
automatically forwards the transmissions to intended customer email
recipients via the Internet.  This automated routing function is 
accomplished by assigning individual telephone numbers with both "800" and 
non "800" area codes, to individual or group customer recipients.
Subsequently, recipients have the ability to view and distribute the 
received email with attached facsimile images without paper creation while
retaining the option of printing the received images.

Wiltek presently has Microsoft Certified System Engineers and Microsoft 
Product Specialists on staff certified in a variety of Microsoft product and
technologies such as Windows NT(r) Server, Windows NT(r) Workstation, 
Microsoft Mail(r), Microsoft Exchange(r), Microsoft SMS(r), Microsoft 
Internet Information Server(r), TCP/IP, and Microsoft Windows for 
Workgroups(r).  Wiltek's certified engineers and product specialists are 
located in both the Connecticut and Swindon, England facilities.  These 
individuals provide Wiltek's consulting customers with Microsoft 
BackOffice(r) planning and implementation assistance.  Wiltek concentrates
efforts towards infrastructure and application design and development within
the Microsoft NT(r) Server, Microsoft Exchange(r) and mail environments.  
Application work includes software development, utilizing Visual Languages 
to address application migration and workflow automation within large
organizations.
<TABLE>
<CAPTION>
Revenues
                                    Year Ended October 31,
                                  (In thousands of dollars)
                                    1998            1997
<S>                               <C>             <C>
Messaging services                $4,480.1        $4,660.1
Consulting services                3,104.2         1,376.6
    Total                         $7,584.3        $6,036.7

</TABLE>


Messaging services revenues decreased by 3.9% and Consulting services 
revenues increased by 125.5% in the fiscal year ended October 31, 1998.
Messaging services revenues decreased primarily due to renegotiated 
contracts at lower prices and reduced volumes from existing customers.
Wiltek's rapid consulting service revenue growth is attributable to several
factors.  Early in fiscal 1998, the Company successfully completed several
large-scale and complex consulting engagements and simultaneously recruited
and hired a number of highly trained, certified and experienced consultants,
which nearly doubled its average consulting staff over fiscal 1997. As a
result, the Company has earned and now enjoys a reputation as a provider of
technically superior project management and consulting services related to
Microsoft BackOffice(r) product installations where demand for qualified and
competent service providers remains high.


Major Customers

During the year ended October 31, 1998, two customers had revenues exceeding
10% of the company's total revenues, General Electric and Sea-Land Service, 
Inc. with 11.6% and 10.1%, respectively.  In fiscal year 1997 Sea Land 
Service, Inc. accounted for over 10% of total revenues with 15.4%.


Major Vendors

During the year ended October 31, 1998 and 1997, approximately 18% and 26%
respectively, of total purchases of the Company were made from two vendors.
Management believes that there is a ready source of alternative suppliers 
should a need arise and therefore loss of these suppliers would not cause 
a delay or loss of sales.


Foreign and Domestic Operations and Export Sales

The Company began foreign operations in 1983 in England to provide services
to its customers outside of the United States.  Operations outside the 
United States are subject to the usual risks and limitations attendant upon
investments in foreign countries, such as fluctuations in currency values,
exchange control regulations, wage and price controls, employment
regulations, effects of foreign investment laws and other domestic and 
foreign governmental policies affecting United States companies doing 
business abroad.  The company does not engage in a formal risk management
program with respect to foreign currency exposure.  Typically the company
maintains cash balances in UK banks to provide for the working capital
requirements of Wiltek (UK) Ltd.  As of October 31, 1998 and October 31,
1997 these deposits were $150,600 and $102,900 respectively.  The company
receives a portion of its revenue from foreign revenue sources, incurs
service costs in England, denominated in UK pounds, and has assets and
liabilities in the UK.  These factors give rise to currency risks which are
dependent upon the fluctuation in exchange rates between the US dollar and
UK pound.  Wiltek does not use derivative instruments to hedge this risk.
All currency figures are expressed in US dollars.





  Information about the company's operation in different geographical areas:
<TABLE>
<CAPTION>                                    Year Ended October 31,
                                  (In thousands of dollars)

                                           United
                           Domestic        Kingdom           Total
<S>                        <C>           <C>               <C>
1998
Revenues                   $6,660.4      $   923.9         $7,584.3

Net Earnings (Loss)        $  423.7$     $  (116.3)        $  307.4

Identifiable Assets        $2,320.5      $   424.6         $2,745.1

1997

Revenues                   $5,020.9      $ 1,015.8         $6,036.7

Net Earnings (Loss)        $  (26.3)     $    65.5         $   39.2

Identifiable Assets        $1,960.4      $   409.1         $2,369.5
<FN>
Included in the above are U.S. management costs allocated to U.K. operations
and net interest expense charged to Wiltek (U.K.) Ltd. in the amount of
$253,500 and $41,900, respectively in 1998 and $201,800 and $40,400,
respectively in 1997.
</TABLE>

Net Sales Backlog

The Company believes that sales backlog is not a meaningful indication of 
future revenue because most of its revenue is derived from short-term 
contracts for both communications services and consulting services which are
generally initiated within 90 days of receipt of an order.


Employees

The company and its subsidiary Wiltek (U.K.) Ltd. employed 50 full-time
employees as of October 31, 1998.


Competition

The office automation and communications field in which the company operates
is highly competitive and characterized by rapid changes due to 
technological improvements and developments.  Both low-cost commodity and 
high-cost custom providers of services exist within the company's 
marketplace.  Major service competitors include Control Data Systems, 
AT&T (r) and Sprint (r).  Consulting competitors are ill-defined due to the
infancy of the Microsoft BackOffice (r) product line from a corporate
acceptance and implementation standpoint.  Despite the competition, the 
company believes that its high level of capability in software development,
network management and cost effectiveness make it competitive in the
industry.

Research and Development 

The company's research and development activities are directed toward 
enhancing existing services and creating new services, including consulting
services for networking and workflow automation to meet customers' data
communication needs.  During fiscal years 1998 and 1997 Wiltek spent
$491,900 and $519,400, respectively, on research and software development.


Item 2.  Properties

The company occupies a portion of a three-story building at 542 Westport 
Avenue, Norwalk, Connecticut, as a tenant under a lease expiring 
December 31, 1999.  The space consists of approximately 15,000 square feet 
and is utilized for offices and a computer center.  The Company also 
has 1,200 square feet at Building 101, Merritt 7 Corporate Park, Norwalk,
Connecticut, under a lease expiring July 23, 2001.  This space was primarily
 used for sales activities until June 1, 1998, when the space was sublet to 
a third party for the remaining term of the lease.  Additionally, the 
company is leasing approximately 3,500 square feet in Swindon, England for 
the Wiltek (U.K.) computer center under a lease, which expires February 1, 
2004.


Item 3.  Legal Proceedings

The company is not involved in any material pending legal proceedings.

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

There were no matters submitted to a vote of security holders during the 
fourth quarter of the fiscal year covered by this report through the
solicitation of proxies or otherwise.



                                   PART II


Item 5.  Market for the Registrant's Common Stock and Related Security 
Holder Matters

(a)  The following table shows the range of closing bid prices for the 
Common Stock, in the over-the-counter market for the fiscal quarters 
indicated, as reported by NASDAQ.  The quotations represent prices in the 
over-the-counter market between dealers in securities, do not include retail
markup, markdown or commission and do not necessarily represent actual
transactions:
<TABLE>
<CAPTION>

                                                   Bid Prices

    1998                                    High                 Low
<S>                                        <C>                  <C>                         
First Quarter                              27/32                7/16
Second Quarter                               3/4                 1/2
Third Quarter                                7/8                 5/8
Fourth Quarter                             23/32                 3/8

<CAPTION>

    1997                                    High                 Low
<S>                                        <C>                  <C>
First Quarter                              13/32                7/32
Second Quarter                             27/32               13/32
Third Quarter                              1 3/8                 5/8
Fourth Quarter                             27/32                7/16
</TABLE>


(b)  Approximate number of equity security holders:
<TABLE>
<CAPTION>

                                             Approximate Number of
                                              Record Holders as of
         Title of Class                        December 21, 1998
<S>                                                <C>                                            
 Common Stock, No Par Value                        742
</TABLE>
(c)  Dividends

The company has not paid cash dividends on its Common Stock.  The payment of
dividends is at the discretion of Wiltek's Board of Directors.  The company
plans to reinvest its cash flow in its business and does not anticipate
payment of cash dividends in the foreseeable future.


Item 6.  Management's Discussion and Analysis of Financial Condition and 
Results of Operations


Summary

The following table sets forth for the periods indicated (i) percentages of
certain items to net revenue of the company and (ii) the percentage
increases (decreases) of such items as compared to the prior period:
<TABLE>
<CAPTION>
                                 Relationship to          Period to Period
                                 Total Revenues          Increase (Decrease)
                               Year Ended October 31,       Years Ended

                                 1998          1997            1998-97*
<S>                              <C>           <C>              <C>
Net Revenues:
  Messaging services             59.1%         77.2%             (3.9)%
  Consulting services            40.9          22.8             125.5
    Total net revenues          100.0         100.0              25.6

Cost of Services                 61.1          56.0              37.2

Gross Margin                     38.9          44.0             (10.9)

Sales expenses                   13.6          18.7              (8.5)
General & admin. expenses        14.1          15.6              13.6
Research and development          6.5           8.6              (5.3)
Interest expense                   .6            .5                NM

Net Earnings                      4.1%           .6%            684.2%
<FN>

* NM - Not Meaningful
</TABLE>
Net Revenues

Messaging services revenues decreased by 3.9% and Consulting services 
revenues increased by 125.5% in the fiscal year ended October 31, 1998.
Messaging services revenues decreased primarily due to renegotiated 
contracts at lower prices and reduced volumes from existing customers.
Wiltek's rapid consulting service revenue growth is attributable to several
factors.  Early in fiscal 1998, the Company successfully completed several
large-scale and complex consulting engagements and simultaneously recruited
and hired a number of highly trained, certified and experienced 
consultants, which nearly doubled its average consulting staff over fiscal
1997 average. As a result, the Company has earned and now enjoys a 
reputation as a provider of technically superior project management and
consulting services related to Microsoft BackOffice(r) product installations
where demand for qualified and competent service providers remains high.


Cost of Services and Gross Profit Margins.

The cost of cervices increased by 37.2% in the current fiscal year when
compared to last year primarily due to significantly higher Consulting
services sales volume.  Gross margins decreased from 44.0% to 38.9%
primarily due to increased volume from lower margin consulting services
business and secondarily due to various messaging contracts renegotiated at
lower prices.


Sales Expenses

Sales expenses decreased 8.5% in the current fiscal year and as a percent of
total revenues decreased from 18.7% to 13.6%, from 1997 to 1998. The
decreases were primarily attributable to lower spending for advertising and
promotion, travel and telephone.


General & Administrative Expenses

The company's general & administrative expenses were $1,068,800 or 14.1% of
total revenues in fiscal 1998 compared to $941,000 or 15.6% of total
revenues in fiscal 1997.  The 13.6% increase in expense was mainly
attributable to higher salaries and benefits.


Research and Development 

Research and development expenditures were $491,900 and $519,400 for fiscal
1998 and 1997, respectively.  The 5.3% reduction in expense in fiscal 1998
was mainly due to lower salaries and benefits resulting from fewer employees
assigned to R&D projects and lower depreciation expense.







Interest Expense 

Interest expense increased by 55.3% to $48,300 in fiscal 1998 from $31,100,
in fiscal 1997.  The increase was mainly due to higher interest associated
with increased capitalized leased asset acquisitions and costs pertaining to
Wiltek's new working capital bank credit facility.


Year 2000

Wiltek established a Year 2000 (Y2K) oversight committee in 1998, to review
all of the Company's computer systems and programs as well as those of third
parties whose data or functionality Wiltek relies on in any material
respect.  The objective of the review is to assess the ability of the 
computer systems and programs to process transactions in the year 2000.
A formal Y2K compliance program was created that encompasses five key 
readiness areas: 1) awareness, 2) assessment; 3) renovation; 4) validation 
and notification; and 5) implementation.  Specific Y2K compliance 
performance procedures and timetables have been developed for each readiness
area.  Management anticipates having the Y2K compliance program 
substantially completed and verified for all production environments on or
before June 30, 1999.

Wiltek has also contacted substantially all of their hardware and software
component suppliers requesting a Y2K compliance certification letter.
To date, information accumulated from a majority of our key suppliers 
indicates that their products are either Y2K compliant or they are in the
process of developing remediation plans.  Wiltek will develop a supplier
action list and contingency plan based on the suppliers' progress to 
adequately address the Y2K issue.  The Company has budgeted approximately
$100,000 through the year 1999 for the Y2K compliance program, $75,000 of
which is for internal labor.  Nominal expenditures, primarily for 
maintenance, will be made beyond the year 2000.


Liquidity and Cash Flow

Cash and cash equivalents at October 31 are presented in the following 
table:
<TABLE>
<CAPTION>

                                             1998               1997
<S>                                        <C>                <C>
Cash in banks                              $622,700           $132,400
Bank money market funds                      45,200            394,300
                                           $667,900           $526,700
</TABLE>

Cash and cash equivalents increased by $141,200 during fiscal 1998.
The main reasons for the increase in cash were net earnings of $307,400,
depreciation of $217,400, non-cash expenses for the issuance of stock
of $37,300, a decrease in receivables of $32,200 and proceeds from exercise
of stock options of $12,000, which were partially offset by a decrease in
accounts payable of $36,800, capital expenditures of $279,100 (excluding
leased capital acquisitions) and payments under capital lease obligations of
$149,200.



Cash and cash equivalents increased by $119,100 during fiscal 1997.  The
main reasons for the increase in cash were net earnings of $39,200,
depreciation of $182,500, non-cash expenses for the issuance of stock and
options of $96,100, and an increase in accounts payable of $358,900 which
were partially offset by capital expenditures of $117,300, payments under
capital lease obligations of $116,500, and an increase in accounts
receivable $326,300.

The company currently has $2,610,800 in net operating loss carry-forwards
for U.S. tax purposes, of which $354,900 will expire in 1999 and the
balance in 2007 through 2010.  See note 8 to the Consolidated Financial
Statements for additional details.  Wiltek (U.K.) Ltd. has a tax loss
carry-forward of $711,400.

Capital expenditures in fiscal 1998 were $486,300.  Purchases included
computer equipment for $320,700, leased equipment for $164,600, and
furniture and fixtures for $1,000.

Capital expenditures in fiscal 1997 were $274,100.  Purchases included
computer equipment for $98,300, leased equipment for $150,700, and
furniture and fixtures, leasehold improvements, and lab equipment for 
$25,100.

Anticipated capital expenditures in 1999 will be approximately $370,000.
We expect that available cash resources, cash flow from operations and bank
credit lines will meet these capital requirements.

The company entered into capital lease obligations totaling $164,600 and
$150,700 for the years ending October 31, 1998 and 1997, respectively.  The
capital leases were primarily for new computer equipment.


Item 7.  Financial Statements and Supplementary Data

See the Consolidated Financial Statements annexed hereto and Item 6 above.

Item 8.  Disagreement on Accounting and Financial Disclosure

During the year ended October 31, 1998, or the twenty-four month period
prior thereto, there were no disagreements on accounting and financial
disclosure practices.


                                  PART III


Item 9.  Directors and Executive Officers of the Registrant


(a)  Identification of directors

Information with respect to the directors is contained in the company's 
proxy statement for the 1998 Annual Meeting of Shareholders and is 
incorporated herein by reference pursuant to General Instruction G (3).



(b)  Identification of executive officers

The names, ages and positions of all executive officers of the company are
listed below along with a brief description of their business experience.
All officers are appointed by the Board annually to serve for the ensuing 
year.
<TABLE>
<CAPTION>

Name                      Age         Positions and Offices*
<S>                        <C>        <C>
David S. Teitelman         42         Director, President & CEO

David P. Holst-Grubbe      41         Vice President

Kevin P. Carathanasis      30         Vice President
</TABLE>

*William P. Bunce held the position of Vice President until September 30, 
1998, after which, by mutual agreement, he entered into a transition period,
following which, he will pursue other activities.

Mr. Teitelman came to the company in 1982 and served in a variety of 
positions including software engineering, operations and systems 
engineering.  He became Director of Marketing and Systems Engineering in 
1994.  On April 1, 1995 he was selected to become President and CEO of the
company.  He was appointed to Wiltek's Board of Directors in 1997.

Mr. Holst-Grubbe joined Wiltek in 1996 and was selected as Vice President,
Sales in January 1997.  In 1998 he also assumed the Company's Marketing
responsibilities.  Mr. Holst-Grubbe previously served in a variety of sales,
marketing and engineering capacities in the communications services, systems
and systems integration fields over the last 20 years at Control Data,
USSprint and General Datacom.  He holds a bachelor's degree from Shepherd
College in West Virginia.

Mr. Carathanasis joined Wiltek in 1996 as director of Messaging Services,
he is responsible for overall development of messaging services strategy,
revenue attainment, and messaging services management.  In January 1997, he
was selected to become Vice President, Messaging Services.  He holds a 
Bachelor of Science degree in computer science from Eckerd College in St.
Petersburg, FL.  Prior to joining Wiltek, Kevin Carathanasis was employed by
IBM where he held various positions in electronic messaging, participating 
in the development, launch, marketing, and support of electronic messaging 
services.


Item 10.  Management Remuneration and Transactions


The information required by this item is contained in the company's proxy
statement for the 1999 Annual Meeting of Shareholders and is incorporated
herein by reference pursuant to General Instruction G (3).







Item 11.  Security Ownership of Certain Beneficial Owners and Management

The information required by this item is contained in the company's proxy
statement for the 1999 Annual Meeting of Shareholders and is incorporated
herein by reference pursuant to General Instruction G (3).

Item 12.  Certain Relationships and Related Transactions

Not applicable.

                                   PART IV


Item 13.  Exhibits and Reports on Form 8-K

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

      (1)  Financial Statements 

            The consolidated financial statements filed as part of this 
            report are as listed in the Index to Financial Statements on 
            page 17, which immediately precede such statements.

      (2)  Exhibits

            A list of the exhibits required by Item 601 of Regulation S-K
            filed as part of this report is set forth in the Index to 
            Exhibits on page 34, which immediately precedes such exhibits 
            and is incorporated herein by reference.


(b)  Reports on Form 8-K

       There was no information requiring a filing on form 8-K during the 
       twelve months ended October 31, 1998.


                                 Signatures

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


                                 WILTEK, INC.

                                     By:

                      _____________________________________
                       David S. Teitelman, President & CEO

                      _____________________________________
                    Walter R. Keisch, Chief Financial Officer


Date:  December 29, 1998

Pursuant to the requirements of the Securities Exchange Act of 1934, this 
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the date indicated:



___________________________________                Date: December 29, 1998

Jay W. Fitzpatrick
Chairman



___________________________________                Date: December 29, 1998

David S. Teitelman
Director, President and Chief Executive Officer



___________________________________                Date: December 29, 1998

Boris Frenkiel
Director and Secretary



___________________________________                Date: December 29, 1998

F. Spencer Pooley
Director



___________________________________                Date: December 29, 1998

Graeme MacLetchie
Director



___________________________________                Date: December 29, 1998

David Holst-Grubbe
Vice President, Sales and Marketing



___________________________________                Date: December 29, 1998

Kevin Carathanasis
Vice President, Messaging Services




                                Wiltek, Inc.
                       Index to Financial Statements


New York, New YDecember 11, 1998ork

<TABLE>
<CAPTION>

                                 Wiltek, Inc.
                          Consolidated Balance Sheet


                                                                 
<S>                                                           <C>



   Cash and cash equivalents                                  $    667,900
   Accounts receivable, less allowance for
    doubtful accounts - $35,000                                  1,073,600
   Other current assets                                            106,400

       Total current assets                                      1,847,900

Equipment, net                                                     897,200

       Total assets                                            $ 2,745,100

LIABILITIES AND SHAREHOLDERS' EQUITY 

Current liabilities

   Obligation under capital leases, current portion           $    134,700
   Accounts payable and accrued expenses                           945,300
   Deferred income                                                 121,800

       Total current liabilities                                 1,201,800

Long term liabilities

   Obligation under capital leases, less current portion            92,400

Commitments and contingencies

Shareholders' equity

   Preferred stock, 1,000,000 shares authorized and unissued 
   Common stock, stated value $.33-1/3 per share, 
    common shares authorized 9,000,000,  
    shares issued 4,884,693                                      1,628,200

   Paid-in capital                                               5,591,800
   Accumulated deficit                                          (4,552,700)
   Less treasury stock at cost, 992,565 shares                  (1,216,400)

       Total shareholders' equity                                1,450,900

       Total liabilities and shareholders' equity              $ 2,745,100

<FN>

        See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
<CAPTION>
                                 Wiltek, Inc.
                     Consolidated Statements of Operations



                                                    Year Ended October 31,
                                                    1998             1997
<S>                                              <C>              <C>
Net Revenues
   Messaging services                            $4,480,100       $4,660,100
   Consulting services                            3,104,200        1,376,600
       Total net revenues                         7,584,300        6,036,700



Costs and Expenses
   Cost of messaging services                     2,428,700        2,230,100
   Cost of consulting services                    2,208,000        1,149,400
   Sales expenses                                 1,031,200        1,126,500
   General and administrative expenses            1,068,800          941,000
   Research and development                         491,900          519,400
   Interest expense                                  48,300           31,100

                                                  7,276,900        5,997,500


Net Earnings                                        307,400     $     39,200


Earnings Per Common Share:
   Basic                                               $.08             $.01
   Diluted                                             $.07             $.01

Number of Shares used in per share calculation:
   Basic                                          3,838,083        3,684,205
   Diluted                                        4,140,364        4,000,135

<FN>

See accompanying notes to consolidated financial statements.

</TABLE>













<TABLE>
<CAPTION>




                                 Wiltek, Inc.
                     Consolidated Statements of Cash Flows



                                                    Year Ended October 31,
                                                    1998             1997
<S>                                              <C>               <C>
Cash flows from operating activities:
   Net earnings                                  $ 307,400         $ 39,200
   Adjustments to reconcile net earnings to 
    net cash provided by operating activities:
     Depreciation and amortization                 217,400          182,500
     Issuance of treasury stock as bonus            37,300           78,600
     Issuance of non-employee stock option                           17,500
     Decrease (increase) in accounts
       receivable and other current assets          32,200         (326,300)
     (Decrease) increase in accounts
       payable and accrued expenses                (36,800)         358,900

            Total adjustments                      250,100          311,200

Net cash provided by operating activities          557,500          350,400

Cash flows from investing activities:
   Capital expenditures                           (279,100)        (117,300)

Net cash used in investing activities             (279,100)        (117,300)

Cash flow from financing activities:
   Proceeds from exercise of stock options          12,000            2,500
   Payments under capital lease obligations       (149,200)        (116,500)

Net cash used in financing activities             (137,200)        (114,000)

   Net increase in cash and cash equivalents       141,200          119,100

   Cash and cash equivalents at
    beginning of year                              526,700          407,600

Cash and cash equivalents at end of year         $ 667,900        $ 526,700


Supplemental disclosures of cash flow information:
   Cash paid during the year for income taxes  $     5,000      $     3,200

   Interest expense                             $   55,600       $   39,300

Non-cash investing and financing activities:
   Capital expenditures in accounts payable     $   57,300       $   14,700
   Capital lease obligations incurred
    for fixed asset acquisitions                 $ 164,600        $ 150,700

<FN>

        See accompanying notes to consolidated financial statements.
</TABLE>


                                 Wiltek, Inc.
                 Notes to Consolidated Financial Statements


Note 1 - Accounting Policies and Practices

General:  The Company operates exclusively in the messaging and integration
services industry segment with two lines of business, 1) the design and
management of data communication networks and services and 2) consulting/
system integration services related primarily to implementation, directory 
integration and development of Microsoft(r) Networking, Microsoft 
Exchange(r) and related Microsoft BackOffice(r) products.  These services 
are principally performed in the United States.

During the fiscal year ended October 31, 1998, two customers accounted for
more than 10% of the Company's total revenues.  These customers were General
Electric and Sea-Land Services, Inc. with 11.6% and 10.1%, respectively.
General Electric's accounts receivable balance exceeded 10% of the
outstanding accounts receivable with 13.7%.

During the fiscal year ended October 31, 1997, Sea-Land Services, Inc 
accounted for more than 10% of the Company's total revenues with 15.4%.
Three customers' accounts receivable balances exceeded 10% of the 
outstanding accounts receivable.  These customers in aggregate amounted 
to 44.1% of the accounts receivable balance.

The Company began foreign operations in 1983 when it established its 
computer center in London, England. During fiscal year 1998, the U.K.
operation's total revenues were $923,900 with a net loss of $116,300.
Included in the above were $253,500 in U.S. management costs allocated
to U.K. operations and inter-company net interest expense charged to Wiltek
(U.K.) Ltd. for $41,900.  Identifiable total assets amounted to $424,600.
The U.S. dollar is the functional currency of the U.K. operation.

During fiscal year 1997, the U.K. operation's total revenues were $1,015,800
with net earnings of $65,500.  Included in the above were $201,800 in U.S.
management costs allocated to U.K. operations and inter-company net interest
expense charged to Wiltek (U.K.) Ltd. in the amount of $40,400.
Identifiable total assets were $409,100.

Consolidation:  The accompanying consolidated financial statements include
the accounts of the Company and its subsidiary, Wiltek (U.K.) Ltd.  All
significant inter-company transactions have been eliminated in
consolidation.

Cash Equivalents:  For purposes of the statement of cash flows, the Company
considers all highly liquid instruments including money market funds and
certificates of deposit with original maturities of three months or less to
be cash equivalents.  The Company currently has on deposit in the U.S. 
approximately $36,900, which is subject to concentration of credit risk as 
it is not insured.  Funds on deposit in the U.K. in the amount of $150,600 
are not insured.





Revenue Recognition:  Customers are invoiced at the beginning of the month 
for fixed rate services and at the end of the month for usage sensitive
services.  Consulting services are primarily on a time and material basis
and are invoiced mid-month and at month-end.  Revenue is recognized when
services are performed.

In accordance with the terms of contracts with some of its customers, the
Company pays the common carrier communication costs incurred by the
customers.  The Company is reimbursed by the customers for these costs.
The reimbursement is reflected as a reduction of expenses in the Company's 
consolidated statement of operations and is not included in revenues.
Amounts billed to the Company and subsequently re-billed to the customers
during the fiscal years ended October 31, 1998 and 1997 were $624,400 and
$738,400, respectively.


Equipment:  Equipment is carried at cost.  Major renewals and betterments 
are charged to the equipment accounts, while replacements, maintenance and
repairs which do not improve or extend the life of the respective assets,
are expensed currently.  The Company follows the policy of providing for 
depreciation of equipment over the estimated useful lives: computer 
equipment - 5 years; furniture and fixtures - 8 to 10 years; automobiles - 4
years, leasehold improvements over the remaining life of the lease.  Fixed
assets under capital lease obligations are depreciated over five years.
When equipment is retired or otherwise disposed of, the related cost and
accumulated depreciation and amortization are eliminated from the accounts
and the resulting profit or loss is credited or charged to income.

Research and Development:  The Company's research and development activities
are directed toward enhancing existing services and creating new services to
meet customers' data communication needs.  During fiscal years 1998 and
1997, Wiltek spent $491,900 and $519,400, respectively, on research and 
software development.

Taxes:  The Company follows the provisions of Statement of Financial 
Accounting Standards No. 109, "Accounting for Income Taxes" (SFAS 109).

Earnings Per Share: The Company adopted the provisions of Statement of 
Financial Accounting Standards No. 128 ("SFAS 128"), "Earnings per Share,"
which is effective for financial statements issued after December 15, 1997.
The new standard eliminates primary and full diluted earnings per share and
requires presentation of basic and diluted earnings per share together with
disclosure of how the per share amounts were computed.  Basic EPS is based
on the weighted-average shares outstanding during the applicable period.
Diluted EPS reflects the potential dilution that could occur if securities
or other contracts to issue common stock were exercised or converted into 
common stock.  1997 Earnings per Share have been restated to conform to the
provisions of SFAS 128.  The effect of adopting this new standard does not
have a material impact on the disclosure of earnings per share in the 
financial statements.

Use of Estimates:  In preparing the Company's financial statements, 
management is required 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, as well as 
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.

The valuation allowance for the deferred tax asset (see note 8) is based on 
an estimate, which is particularly sensitive to change in the near term.  It
is possible that changes in this estimate will occur and the effect of such
change may be significant to the financial statements of the Company.

Advertising and Promotion Costs:  Advertising and promotion costs are 
expensed when incurred.  These costs were $106,000 in 1998 and $144,600 
in 1997.

Fair Value of Financial Instruments:  Based on borrowing rates currently
available to the Company for capital leases with similar terms and
maturities, the fair value of the Company's capital leases approximates 
the carrying value.  The carrying values of all other financial instruments
potentially subject to valuation risk, principally cash, accounts receivable
and accounts payable, also approximate fair value because of their 
short-term maturities.

Impairment of Long-lived Assets:  Statement of Financial Accounting 
Standards No. 121, "Accounting for the Impairment of Long-lived Assets and 
for Long-lived Assets to be Disposed Of" ("SFAS No. 121") establishes 
accounting standards for the impairment of long-lived assets, certain 
identifiable intangibles, and goodwill related to those assets.  Under
provisions of the Statement, impairment losses are recognized when expected
future cash flows are less than the assets' carrying value.  Accordingly,
when indicators of impairment are present, the Company will evaluate the 
carrying value of equipment in relation to the operating performance and 
future undiscounted cash flows of the underlying business.  SFAS No. 121
requires analysis of each item on an individual asset-by-asset basis, where
applicable.  The amount of the impairment loss is the excess of the carrying
amount of the impaired asset over the fair value of the asset.  Generally,
fair value represents the expected future cash flows from the use of the 
asset or group of assets; discounted at an interest rate commensurate with 
the risks involved.

Accounting for Stock-Based Compensation:  In 1996, the Financial Accounting
Standards Board issued Statement No. 123, "Accounting for Stock-Based
Compensation" ("SFAS No. 123").  The statement defines a fair value based
method of accounting for an employee stock option.  Companies may, however,
elect to adopt this new accounting rule through a pro forma disclosure 
option, while continuing to use the intrinsic value based method of 
accounting prescribed by APB Opinion No. 25, "Accounting for Stock Issued to
Employees."  Under the disclosure option, companies must make pro forma
disclosures of net earnings and earnings per share, as if the fair value
method of accounting described below had been applied.

Under the new fair value method, compensation cost is measured at the grant 
date based on the value of the award and is recognized over the service (or
vesting) period.  Under the intrinsic value based method, compensation cost
is the excess, if any, of the quoted market price of the stock at grant 
date, over the amount an employee must pay to acquire the stock.

The adoption of this Statement was required, either through adoption or
disclosure in 1997.  The Company decided to follow the accounting
prescribed by APB Opinion No. 25.



Employee Benefit Plan:  The Company has established a 401(k) defined
contribution plan covering substantially all eligible employees.  An
eligible employee may elect to reduce his taxable compensation and have the
amount of any such reduction contributed to the Plan on the employee's 
behalf.  The Company may also make a discretionary matching contribution to
the Plan.  During the fiscal years ended 1998 and 1997, the Company's 
matched contribution was 15%.

An eligible employee may elect to reduce his taxable compensation by 15% 
(but not more than $10,000 per year or such greater amount as may be set by
the Internal Revenue Service).  The amount of the reduction is called 
elective deferral.  The Company will then contribute the elective deferral 
to the Plan on the employee's behalf.  The Company's contributions to the 
plan for the years ended October 31, 1998 and 1997, were $34,700 and
$21,600, respectively.

New Accounting Pronouncements:  The Financial Accounting Standards Board has
recently issued Statement of Financial Accounting Standards No. 130 ("SFAS
130"), "Reporting Comprehensive Income," Statement of Financial Accounting
Standards No. 131 ("SFAS 131"), "Disclosures About Segments of an Enterprise
and Related Information" and Statement of Financial Accounting Standards 
No. 133 ("SFAS 133"), "Accounting for Derivative Instruments and Hedging
Activities".

SFAS 130 governs the reporting and display of comprehensive income and its
components, while SFAS 131 requires that all businesses report financial and
descriptive information about their reportable operating segments.  Both
statements are applicable to fiscal years beginning after December 15, 1997.
SFAS 133 requires all businesses to measure derivative financial instruments
at fair value and record them as assets or liabilities in the statement of
financial position and to reflect changes in fair value as gains or losses.
SFAS 133 is applicable to fiscal years beginning after June 15, 1999.

The impact of adopting SFAS No. 130 and SFAS No. 133 is not expected to be
material to the consolidated financial statements or notes to the
consolidated financial statements.  Management is currently evaluating the
effect of SFAS 131 on consolidated financial statement disclosures.

Note 2 - Equipment
 <TABLE>                                                             October 31,
                                                                 1998
<S>                                                          <C>                                                       
Computer equipment                                           $ 1,012,000
Capital leases                                                   633,200
Other equipment                                                   47,700
Furniture and fixtures                                            21,800
Leasehold improvements                                           360,700
                                                               2,075,400
Less:  accumulated depreciation
        and amortization                                       1,178,200

           Equipment, net                                    $   897,200
</TABLE>
<TABLE>
<CAPTION>





Note 3 - Accounts Payable and Accrued Expenses
                                                              October 31,
                                                                 1998
<S>                                                          <C>                                                     
Accounts payable                                             $   533,200
Accrued compensation                                             299,400
Other accrued expenses                                           112,700

           Total accounts payable and
            accrued expenses                                 $   945,300

</TABLE>
Note 4 - Obligation under Capital Leases

During the fiscal years ended October 31, 1998 and 1997, the Company entered
into various capital lease agreements for new computer equipment totaling
$164,600 and $150,700, respectively.  The lease terms vary from 36 to 39
months, with interest rates between 11.13% and 35.08%. 

Accumulated depreciation for capitalized lease equipment amounted to 
$299,700 and $256,200 for the fiscal years ended 1998 and 1997, 
respectively.

The related future lease minimum payments as of October 31, 1998 are as 
follows:
<TABLE>
<CAPTION>
Year Ending October 31
                                  Capital Leases
<S>                                                        <C>
1999                                                       $175,400
2000                                                        101,400
2001                                                         15,400
Net minimum lease payment                                   292,200
Amount representing interest                                 65,100

Obligation under capital leases                            $227,100
</TABLE>




Note 5 - Changes in Shareholders' Equity

Set forth below is a summary of changes in shareholders' equity for the two
years ended October 31, 1998:
<TABLE>
<CAPTION>

    Common                                              Treasury Stock
    Shares     Common      Paid-In    Accumulated
    Issued      Stock      Capital      Deficit        Cost       Shares
<S>  <C>        <C>         <C>         <C>           <C>           <C>       
Balance at
 10/31/96 
     4,826,693  $1,608,900  $5,650,600  $(4,899,300)  $(1,403,900)  1,146,235

Issuance of
 treasury
 stock as bonus             (56,300)                   134,900    (110,598)

Issuance of 
 non-employee 
 stock option                17,500

Exercise
 of stock
 options 
     10,000       3,300     (   800)

Net Earnings                              39,200


Balance at
 10/31/97
    4,836,693   1,612,200   5,611,000   (4,860,100)   (1,269,000)   1,035,637

Issuance of

 treasury 
 stock as bonus           (  15,200)                    52,600      (43,072)

Exercise
 of Stock
 options 
     48,000      16,000   (   4,000)

Net Earnings                             307,400 

Balance at
 10/31/98
    4,884,693  $1,628,200  $5,591,800  $(4,552,700)  $(1,216,400)     992,565

<FN>

During the fiscal year ended October 31, 1998, 43,072 shares of common stock
held as treasury stock with a market value of $37,400 were awarded to four 
of the officers.  During the fiscal year ended October 31, 1997, 5,108 
shares of common stock held as treasury stock with a market value of $3,400 
were awarded to one of the officers.
</TABLE>


Note 6 - Stock Options

The maximum number of shares, which may have been awarded under the 1983 and
1988 stock option plans to employees, was 500,000 and 400,000, respectively.
No shares are available for future grants under these plans, at October 31,
1998.

The 1994 stock option plans for employees (750,000 shares) and non-employees
(100,000 shares) were approved.  An aggregate of 850,000 shares was
authorized under this plan.

At October 31, 1998, 72,000 and 30,000 shares are available for future 
grants to employees and non-employees, respectively.

None of the above option prices were less then fair market value at the date
of grant.  The options are exercisable beginning at the date of grant.  The
maximum term of the grant is ten years.  The following table summarizes the
options granted under the plan for the two years ended October 31, 1998:
EMPLOYEES:
<TABLE>
<CAPTION>

                                           Weighted Average
                             Shares         Exercise Price
<S>                         <C>                 <C>                   
Outstanding at 11/1/96      706,300             $.54
 Granted                    125,000             $.42
 Exercised                 ( 10,000)            $.25
 Expired                   (112,000)            $.52

Outstanding at 10/31/97     709,300             $.53
 Granted                    195,000             $.81
 Exercised                (  48,000)            $.25
 Expired                   (238,000)           $1.38

Outstanding at 10/31/98     618,300             $.48

Non-Employees
                                           Weighted Average
                             Shares         Exercise Price

Outstanding at 11/1/96       35,000             $.25
Granted                      35,000             $.56
Outstanding at 10/31/97      70,000             $.41

Outstanding at 10/31/98      70,000             $.41

</TABLE>
The Company recorded compensation expense of $17,500 for options granted to
 non-employees in the year ended October 31, 1997.









The Company has adopted the disclosure-only provisions of Statement of 
Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation."  The Company accounts for its option plan under APB Opinion
No. 25, "Accounting for Stock Issued to Employees," and related 
interpretations and, accordingly, no compensation cost has been recognized 
for the employee stock option plan.  Had compensation cost for the Company's
employee stock option plan been determined based on the fair value at the 
grant date for awards, net earnings and earnings per share would have been 
reduced as follows:
<TABLE>
<CAPTION>
                                                    1998          1997
<S>                                                <C>         <C>                                                   
      Net Earnings                                    
      As reported                                  $ 307,400   $  39,200
      Pro forma                                    $ 194,800   $ (10,800)

      Earnings Per Share
      As reported
       Basic                                        $ .08        $  .01
       Diluted                                      $ .07        $  .01
      Pro forma        
       Basic                                        $ .05        $  .00
       Diluted                                      $ .05        $ (.01)
<FN>

These pro forma amounts may not be representative of future disclosures 
because they do not take into effect pro forma compensation relating to 
grants before 1996.  The fair value of each option grant is estimated on 
the date of grant using the Black-Scholes option-pricing model with the
following weighted average assumptions: expected volatility of 100% in 1998
and 200% in 1997, weighted average risk free rate of 5.9% in 1998 and 6.8% 
in 1997 and weighted average expected life of 8 years in 1998 and 1997. The
weighted average grant date fair value of options granted during 1998 and
1997 was $0.68 and $0.56, respectively.  
</TABLE>
<TABLE>
<CAPTION>

The following table summarizes information about the stock options at 
October 31, 1998.


                 Options Outstanding                    Options Exercisable

 Range       Number   Weighted Average     Weighted     Number      Weighted
  of      Outstanding    Remaining          Average   Exercisable    Average
Exercise      at        Contractual        Exercise       at        Exercise
 Prices    10/31/98        Life              Price     10/31/98       Price
<S>           <C>          <C>              <C>         <C>         <C>        
$0 to $.25    371,800      6.47             $  .25      371,800     $  .25
$.50 to $.56   75,000      8.08             $  .54       75,000     $  .54
$.81 to $1.28 165,000      8.89             $  .87      165,000     $  .87
$2.94           6,500      1.60              $2.94        6,500      $2.94
              618,300      7.26             $  .48      618,300     $  .48


</TABLE>
<TABLE>
<CAPTION>




Note 7 - Earnings Per Share

For the periods presented in the Consolidated Statement of Operations, the
calculations of basic EPS and EPS assuming dilution vary in that the
weighted average shares outstanding assuming dilution include the 
incremental effect of stock options.  The following table shows the 
reconciliation of Basic and Diluted EPS computations:


                                               Twelve Months Ended 
                                                October 31, 1998

<S>                                  <C>           <C>               <C>      
                                       Earnings       Shares       Per Share
Basic EPS
Earnings                              $ 307,400    3,838,083         $.08


Diluted Effect of Securities:
Stock Options                                        302,281         (.01)


Diluted EPS 
Earnings plus assumed conversions     $ 307,400    4,140,364        $ .07


                                               Twelve Months Ended 
                                                October 31, 1997


                                       Earnings       Shares       Per Share
Basic EPS
Earnings                               $ 39,200    3,684,205        $ .01


Diluted Effect of Securities:
Stock Options                                        315,930          .00


Diluted EPS 
Earnings plus assumed conversions      $ 39,200    4,000,135        $ .01
<FN>

Excluded in the 1998 computation of Diluted EPS were options to purchase 
171,500 shares of common stock at prices ranging from $0.81 to $2.94 because
the options' exercise price was greater than the average market price of the
common shares.  These options, which expire March 21, 1999 to December 15,
2007, included 160,000 of options issued during the twelve months ended 
October 31, 1998.  Excluded in the 1997 computation of Diluted EPS were 
options to purchase 208,000 shares of common stock at prices ranging from 
$0.81 to $2.94 because the options' exercise price was greater than the 
average market price of the common shares.  These options, which expire 
June 7, 1998 to March 24, 2007, included 25,000 shares of options issued 
during the twelve months ended October 31, 1997.

</TABLE>
<TABLE>
<CAPTION>


Note 8 - Income Taxes

Deferred income taxes reflect the tax effects of temporary differences 
between the carrying amounts of assets and liabilities for financial 
reporting and the amounts used for income tax purposes. In accordance with 
SFAS 109, deferred tax assets and liabilities are recognized for the 
estimated future tax consequences attributable to temporary differences 
between the financial statement carrying amounts of existing assets and
liabilities and their respective tax bases. The Company has established a
valuation allowance to reduce its net deferred tax asset to zero at
October 31, 1998 because current evidence indicates that it is more likely 
than not that the deferred tax asset will not be realized.  The valuation
reserve was reduced by $330,100 in the fiscal year ended 1998 as a result of
utilization and expiration of net operating loss carry-forwards.   The 
Company accounts for the investment tax credit by the flow-through method.
In fiscal years ended 1998 and 1997, general and administrative expenses
included tax expense of $5,000 and $3,800, respectively.  Significant
components of the Company's deferred tax assets as of October 31, 1998 
are as follows:
<S>                                                     <C>                
   Deferred tax assets:

      Net operating loss carry-forward                  $1,256,300
      Investment tax credit carry-forward                   36,700

      Deferred tax asset                                 1,293,000
        Less valuation allowance                         1,293,000

      Net deferred tax assets                           $        0

</TABLE>
At October 31, 1998, the Company's U.S. operating loss carry-forwards for
Federal tax purposes approximated $2,610,800 and $1,216,500 for state tax
purposes.  The Company's loss carry-forwards for Federal tax purposes were
reduced by $591,500. The reduction was due to utilization of $302,300 of net
loss carry-forwards in 1998, resulting in a tax benefit of $120,000, the 
expiration of $262,900 in loss carry-forwards and an adjustment by the IRS 
of $26,300.  The Company's loss carry-forwards for State tax purposes were
reduced by $307,000 resulting from the utilization of net loss carry-
forwards in 1998.  The Federal loss carry-forward for alternative 
minimum tax purposes was $2,600,000. The Company's U.K. operating loss 
carry-forwards are approximately $711,400 for tax purposes as of October 31,
1998.  The expected Federal Statutory rate is 34%.  This has been reduced by
the use of net operating loss carry-forwards by 34%.

The Internal Revenue Service has completed its examination of Federal income
tax returns for fiscal years ended 1995, 1996 and 1997 which resulted in an
adjustment to decrease net operating loss carry-forwards by $169,700.


At October 31, 1998, investment tax credits approximating $36,700 are 
available to reduce future taxes on taxable income after the future tax 
benefits arising from existing operating loss carry-forwards have been 
realized. The U.S. tax loss carry-forwards and investment tax credit carry-
forwards expire as follows:
<TABLE>
<CAPTION>
                                       Tax Loss           Investment Tax
   Expiration                       Carry-forwards     Credit Carry-forwards
<S>                                  <C>                     <C>                
      1999                           $   354,900             $ 18,400
      2000                                                     14,400
      2001                                                      3,900
      2007                               404,400
      2008                               628,100
      2009                               474,800
      2010                               748,600
                                     $ 2,610,800             $ 36,700

</TABLE>
The Tax Reform Act of 1986 enacted a complex set of rules (Internal Revenue
Code Section 382) limiting the utilization of net operating loss carry-
forwards to offset future taxable income following a corporate "ownership
change."  Generally, this occurs when there is a greater than 50% change in
ownership.


Note 9 - Commitments and Contingent Liabilities

The Company entered into a loan and security agreement with People's Bank in
June 1998, whereby, People's will make available a line of credit equal to
$750,000 for working capital needs plus an additional term loan up to
$100,000 for purchases of capital equipment.

The working capital loan requires that interest be paid monthly on 
outstanding advances during the term of the loan at one quarter percent 
above prime and a fee on the unused portion of the loan will be payable
quarterly at one quarter percent.  The working capital facility will expire
on July 1, 1999.  At October 31, 1998, there were no advances outstanding
against the working capital facility.

Interest on advances under the term loan are payable monthly in arrears at 
one half percent above prime and the total of such advances outstanding at
December 31, 1998, will be converted to a term loan.  Thereafter, the term
of the loan shall be thirty months payable in equal monthly principal 
payments of one thirtieth of the outstanding balance at December 31, 1998,
plus interest shall be due and payable monthly commencing January 31, 1999, 
at one half percent above prime on the outstanding principal balance.  At
October 31, 1998 there were no advances outstanding against the term loan.

The security agreement provides that the loans be collateralized by the
Company's existing and future assets.  Covenants under the loan and security
agreement provide that the Company's current ratio cannot be lower than 1.2,
tangible net worth be at least $1,000,000 and the Company must achieve 
$100,000 net earnings for each six-month period on a rolling quarterly 
basis.








Annual employment agreements are in effect with three officers of the 
Company which call for a base compensation to be mutually agreed upon at
renewal and upon failure to reach agreement will terminate, with the 
officer, in certain circumstances, being entitled to a severance payment 
in an amount equal to one-quarter to one-half of their then current annual 
base compensation.  The minimum aggregate payoffs under such contracts
approximate $141,500.

Total rental expenses for office space, equipment and automobiles included 
in the results of operations for fiscal years ended October 31, 1998 and 
1997, were $290,700 and $311,500 respectively.  Minimum rental commitments 
under non-cancelable operating leases covering space and equipment are as
follows:
<TABLE>
<CAPTION>


                 Fiscal Year                Rental Commitments 
                    <S>                         <C>                             
                    1999                        $ 240,400
                    2000                          116,000
                    2001                           90,600
                    2002                           90,600
                    2003                           90,600
                    2004                           22,600
                                                $ 650,800

</TABLE>





                                 WILTEK, INC.

                              Index to Exhibits




<TABLE>
<CAPTION>



                                                             Sequential Page
       Exhibit No.          Description                           Number       

          <S>               <C>                                    <C>
          22                Subsidiary                             35



          24                Consent of Independent Certified
                            Public Accountants                     36


</TABLE>