U.S. Securities and Exchange Commission
                      Washington, D.C. 20549


                            FORM 10-QSB



     [X]  QUARTERLY  REPORT  UNDER  SECTION  13  OR 15(D) OF THE SECURITIES
          EXCHANGE ACT OF 1934
          For the quarterly period ended March 31, 1998

          COMMISSION FILE NUMBER   0-20468


                           ALTERNATIVE TECHNOLOGY RESOURCES, INC.
                           (FORMERLY KNOWN AS 3NET SYSTEMS, INC.)
             (Exact name of small business issuer as specified in its charter)



              Delaware                                   68-0195770
  (State or other jurisdiction of            (IRS Employer Identification No.)
  incorporation or organization)


                            629 J Street, Sacramento, CA  95814
                         (Address of principal executive offices)

                                      (916) 325-9370
                               (Issuer's telephone number)


                       (Former address if changed since last report)


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

Number  of shares of  common  stock  outstanding  as  of  April  30,  1998:
26,120,499

<PAGE>2

PART I.   FINANCIAL INFORMATION
Item 1.   Financial Statements



                     ALTERNATIVE TECHNOLOGY RESOURCES, INC.
                     (FORMERLY KNOWN AS 3NET SYSTEMS, INC.)
                           CONDENSED BALANCE SHEET
                                MARCH 31, 1998
                                  (UNAUDITED)

ASSETS

Current assets:
  Cash                                                        $         28,173
  Accounts receivable, net                                             715,430
  Other current assets                                                 102,491
                                                              ----------------
      Total current assets                                             846,094

PROPERTY AND EQUIPMENT:
  Equipment                                                             12,908
  Furniture and fixtures                                               148,445
                                                              ----------------  
                                                                       161,353
  Accumulated depreciation and amortization                           (156,512)
                                                              ----------------
Property and equipment, net                                              4,841
                                                              ----------------
                                                              $        850,935
                                                              ================
LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
  Notes payable to stockholders                               $      3,962,565
  Accounts payable to stockholders                                     451,840
  Accounts payable                                                     115,957
  Accrued payroll and related expenses                                 391,799
  Accrued preferred stock dividends                                    459,376
  Other current liabilities                                             63,625
                                                              ----------------
     Total current liabilities                                       5,445,162

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' DEFICIT:
  Preferred stock, $6.00 par value - 
    1,200,000 shares authorized, 204,167 
    Series D shares issued and outstanding; 
    liquidation preference value of $1,684,378                       1,225,002
  Common stock, $0.01 par value - 100,000,000 shares
    authorized, 26,120,499 shares issued and outstanding               261,205
  Unearned compensation                                               (115,672)
  Additional paid-in capital                                        28,877,316
  Accumulated deficit                                              (34,842,078)
                                                                --------------
Total stockholders' deficit                                         (4,594,227)
                                                                --------------
                                                                $      850,935
                                                                ==============


SEE ACCOMPANYING NOTES TO CONDENSED FINANCIAL STATEMENTS.

<PAGE>3

PART I.   FINANCIAL INFORMATION
Item 1.   Financial Statements


                       ALTERNATIVE TECHNOLOGY RESOURCES, INC.
                       (FORMERLY KNOWN AS 3NET SYSTEMS, INC.)
                         CONDENSED STATEMENTS OF OPERATIONS
                                     (UNAUDITED)

<TABLE>
<CAPTION>


                                                THREE MONTHS                      NINE MONTHS
                                               ENDED MARCH 31,                  ENDED MARCH 31,
                                            1998             1997            1998          1997
<S>                                  <C>             <C>             <C>              <C>
Contract programming:
  Contract programming revenue         $  1,462,983     $    587,686   $   3,492,672   $  1,354,944
  Programmer costs                       (1,052,750)        (510,112)     (2,485,684)    (1,174,632)
  Start-up and other costs                 (272,791)        (120,411)       (669,248)      (267,490)
                                       -------------    -------------  --------------  -------------
    Contract programming gross profit       137,442          (42,837)        337,740        (87,178)
                                       -------------    -------------  --------------  -------------
SYSTEM SERVICE:
  Service revenue                              -              63,804            -           229,690
  Cost of service                              -             (41,765)           -          (103,731)
                                       -------------    -------------  --------------  -------------
    System service gross profit                -              22,039            -           125,959
                                       -------------    -------------  --------------  -------------
SELLING, GENERAL AND ADMINISTRATIVE        (311,810)        (304,357)       (999,298)      (855,432)
                                       -------------    -------------  --------------  -------------
LOSS FROM OPERATIONS                       (174,367)        (325,155)       (661,558)      (816,651)

OTHER INCOME (EXPENSE):
  Interest expense                         (100,608)         (59,912)       (324,634)      (182,883)
  Recovery of legal costs                       -            201,550            -           201,550
  Other, net                                    -               (222)           -            (3,908)
                                       -------------     ------------   -------------  -------------
                                           (100,608)         141,416        (324,634)        14,759
                                       -------------     ------------   -------------  -------------
NET LOSS                               $   (274,976)     $  (183,739)   $   (986,192)  $   (801,892)
                                       =============     ============   =============  =============
PREFERRED STOCK DIVIDENDS IN ARREARS        (30,625)         (30,625)        (91,875)       (91,875)
                                       -------------     ------------   -------------  -------------
Net loss applicable to
  common stockholders                  $   (305,601)     $  (214,364)   $ (1,078,067)  $   (893,767)
                                       =============     ============   =============  =============
NET LOSS PER SHARE                     $      (0.01)     $     (0.01)   $      (0.04)  $      (0.04)
                                       =============     ============   =============  =============
SHARES USED IN PER SHARE 
  CALCULATIONS                           25,843,333       25,489,998      25,821,885     25,325,408
                                       =============     ============    ============  =============

SEE ACCOMPANYING NOTES TO CONDENSED FINANCIAL STATEMENTS.

<PAGE>4

                     ALTERNATIVE TECHNOLOGY RESOURCES, INC.
                     (FORMERLY KNOWN AS 3NET SYSTEMS, INC.)
                       CONDENSED STATEMENTS OF CASH FLOWS
                                   (Unaudited)


                                          Nine Months Ended
                                               MARCH 31,
                                           1998         1997

Net cash used in operating activities          $ (1,235,238)        $ (795,815)

Cash flows from investing activities:
 Sale of property and equipment                       2,061              6,165
                                               -------------        ----------- 
Net cash provided by investing activities             2,061              6,165
                                               -------------        -----------
Cash flows from financing activities:
  Proceeds from exercise of options and warrants     49,843             16,702
  Proceeds from notes payable to stockholders     1,175,303            769,510
  Payments on notes payable and capital leases      (23,539)           (43,404)
                                               -------------        -----------
Net cash provided by financing activities         1,201,607            742,808
                                               -------------        ----------- 
Net increase (decrease) in cash                     (31,570)           (46,842)
Cash at beginning of period                          59,743             52,106
                                               -------------        -----------
Cash at end of period                          $     28,173         $    5,264
                                               =============        ===========


SEE ACCOMPANYING NOTES TO CONDENSED FINANCIAL STATEMENTS.

<PAGE>5

PART I.   FINANCIAL INFORMATION
Item 1.   Financial Statements


                       ALTERNATIVE TECHNOLOGY RESOURCES, INC.
                       (formerly known as 3Net Systems, Inc.)
                       Notes to Condensed Financial Statements
                                   March 31, 1998

                                     (Unaudited)

NOTE 1 - BASIS OF PRESENTATION

The  accompanying   unaudited  condensed  financial  statements  have  been
prepared in accordance  with  generally  accepted accounting principles for
interim financial information and pursuant  to the rules and regulations of
the Securities and Exchange Commission.  Accordingly,  they  do not include
all  of  the  information  and  footnotes  required  by  generally accepted
accounting  principles  for  complete  financial statements.   For  further
information,  refer  to  the  financial statements  and  footnotes  thereto
included in the Company's annual  report on Form 10-KSB for the fiscal year
ended June 30, 1997.

In the opinion of management, the unaudited  condensed financial statements
contain  all  adjustments  considered  necessary  to   present  fairly  the
Company's financial position at March 31, 1998, results  of  operations for
the  three and nine month periods ended March 31, 1998 and 1997,  and  cash
flows  for  the nine months ended March 31, 1998 and 1997.  The results for
the period ended  March  31,  1998  are  not  necessarily indicative of the
results to be expected for the entire fiscal year ending June 30, 1998.

The financial statements and notes thereto also  include  the  effect  of a
one-for-ten  consolidation  of  the Company's outstanding Common Stock, par
value $0.01 per share, which became  effective  on  December  2,  1996.  In
addition, effective on December 2, 1996, the Company changed its name  from
3Net  Systems,  Inc.,  to  Alternative  Technology Resources, Inc., and the
number of authorized shares of Common Stock was reduced from 200,000,000 to
100,000,000.

The report of independent auditors on the Company's June 30, 1997 financial
statements   includes  an  explanatory  paragraph   indicating   there   is
substantial doubt  about  the  Company's  ability  to  continue  as a going
concern.   The  financial  statements  do  not  include any adjustments  to
reflect the uncertainties related to the recoverability  and classification
of assets or the amounts and classification of liabilities  that may result
from the inability of the Company to continue as a going concern.  Based on
steps  the  Company  has  taken  to  reduce  its  expenses and refocus  its
operations, the Company believes that it has developed  a  viable  plan  to
address  the Company's ability to continue as a going concern and that this
plan will enable the Company to continue as a going concern through the end
of fiscal  year  1998.   However,  considering,  among  other  things,  the
Company's historical operating losses and its short history in the contract
computer  programming  industry,  there  can be no assurance that this plan
will be successfully implemented.

NOTE 2 - FINANCING ARRANGEMENTS

See Part I, Item 2 "Management's Discussion  and  Analysis  and  Results of
Operations -- Liquidity and Capital Resources.

<PAGE>6

PART I.  FINANCIAL INFORMATION
Item 2.  Management's Discussion and Analysis and Results of Operations

Management's Discussion and Analysis

The   following   discussion   provides   information   to  facilitate  the
understanding  and assessment of significant changes in trends  related  to
the financial condition  of  the Company and its results of operations.  It
should be read in conjunction  with  the Company's financial statements and
the notes thereto and other financial information included elsewhere in the
10-KSB for the fiscal year ended June  30,  1997.   Dollar amounts reported
have been rounded to the nearest thousand.

Overview

The  Company  was  founded in 1989 to develop and sell computer  integrated
laboratory systems ("LIS").   The  Company  operated  under  the  name 3Net
Systems,  Inc.  and was never successful in the LIS market.  Therefore,  in
fiscal 1996, the  Company  stopped new system development and later decided
to exit LIS entirely.

During fiscal 1997, the Company  changed its name to Alternative Technology
Resources, Inc. ("ATR").  It has since  focused  its  efforts entirely upon
its   computer   programmer   placement   business,  whereby  it   recruits
experienced,  qualified  computer programmers  primarily  from  the  former
Soviet Union, obtains necessary  visas,  and  places them for assignment in
the United States.

THE YEAR 2000 ISSUE

ATR has made an assessment of its computer programs and has determined that
it has no Year 2000 impairment in its computer  systems  developed in-house
and is relying on vendor declarations that their accounting  program has no
impairment related to the Year 2000 issue.

Results of Operation

Contract programming

CONTRACT   PROGRAMMING   REVENUE.   Contract  programming  revenue  results
primarily from sales of  programmer services.

Revenue for the three and nine month periods ended March 31, 1998 increased
$875,000  or 149% and $2,138,000  or  158%,  respectively,  over  the  same
periods of  the previous year.  The increased revenue is a result of having
more programming personnel working at customer sites during the nine months
of fiscal 1998  compared  to  the  same period during fiscal 1997.  For the
nine months ended March 31, 1998 and 1997 there was an average of 67 and 30
programmers, respectively.  For the  three  months ended March 31, 1998 and
1997 there was an average of 85 and 35, respectively.  In addition, revenue
increased  due to an increase in the average billing  rates  during  fiscal
1998 compared to fiscal 1997.

PROGRAMMER COSTS.   Programmer costs are the salary, other wage and benefit
costs of ATR's programmer employees.  Costs increased 106% and 112% for the
three months and nine months ended March 31, 1998, respectively, compared to

<PAGE>7

PART I.  FINANCIAL INFORMATION
Item 2.  Management's Discussion and Analysis and Results of Operations


the same periods in fiscal 1997.  This increase is due primarily to increasing
the average number of programmers and to increasing salaries for more 
experienced programmers.

START-UP AND OTHER COSTS.  Start-up  and  other  costs  are  the  costs  of
recruiting,  training,  and  travel  for programmer employees coming to the
United States from the Former Soviet Union  for  the first time, relocation
costs  within  the  United  States, and legal and other  costs  related  to
obtaining and maintaining compliance  with  required  visas,  postings  and
notifications.

Included  in  this  category  of costs is compensation paid by ATR whenever
programmer employees are hired and enter the United States or are relocated
once in the United States but before  these  programmers begin working at a
customer's work site.  There are sometimes periods  of  up  to several days
when  under  immigration  law,  ATR,  as  employer,  must  pay a programmer
employee  at  least  95% of prevailing wages for his or her specialty  even
when the programmer is not placed.

ATR expenses start-up  and other costs as incurred, which results in timing
differences between the  incurring  of expense and recognition of resulting
revenue.   Such  differences  may be particularly  evident  in  ATR's  case
because of its relatively small  revenue base and rapid growth.  The affect
may  be  particularly  noticeable  whenever  the  timing  of  placement  of
employees is such that the major start-up costs occur late in one reporting
period and the revenues appear in subsequent periods.

Start-up and other costs increased   $152,000  or 127% and $402,000 or 150%
in the three and nine month periods ended March  31, 1998, respectively, as
compared to the same periods in fiscal 1997.  Increases  are due to placing
or relocating more programmers during the first nine months  of fiscal 1998
compared to fiscal 1997.  For the nine and three month periods  ended March
31,   1998   there   were  59  and  35  programmers  placed  or  relocated,
respectively.  This compares  to  27 and 16 programmers placed or relocated
during the same periods last year.

CONTRACT  PROGRAMMING  GROSS  PROFIT.    The   gross   profit  on  contract
programming  revenue  was 9% and 10% for the three and nine  month  periods
ended March 31, 1998, respectively,  compared  to  negative margins of (7%)
and (6%) in the same periods of fiscal 1997.  These  increased  margins are
primarily due to the increase in the total number of programmers generating
revenues  at  higher  average billing rates during fiscal 1998 compared  to
fiscal 1997.

System Service

In  fiscal 1997, the Company  phased  out  all  LIS  software  support  and
hardware services.  As a result, there are no revenues or costs from system
service in fiscal 1998.

Selling, General and Administrative Expenses

SELLING,  GENERAL  AND  ADMINISTRATIVE  EXPENSES  ("SG&A").   SG&A expenses
increased   $7,000  or 2% and $144,000 or 17% for the three and nine  month

<PAGE>8

PART I.  FINANCIAL INFORMATION
Item 2.  Management's Discussion and Analysis and Results of Operations

periods ended March 31, 1998, respectively, compared  to  the same periods of
fiscal 1997.  This increase is primarily due to increasing the average number
of employees currently assigned to administrative functions during the nine
months ended March 31, 1998 compared to the same period in fiscal 1997, offset
by  a decrease in depreciation and professional fees.

Other Income (Expense)

INTEREST EXPENSE.  Interest expense increased  $41,000 and $142,000  in the
three and nine month periods ended March 31, 1998, respectively compared to
the same periods in fiscal 1997 due to a net increase in notes payable  and
other debt of  $1.4 million since March 31, 1997.

REIMBURSEMENT  FROM  INSURANCE COMPANY.  During fiscal 1997, legal expenses
and costs of $201,550  accrued in prior periods by the Company related to a
suit from a former consultant  were  reimbursed  by insurers of Mr. Cameron
and the Company.

Income Taxes

As of June 30, 1997, the Company had a net operating  loss carryforward for
federal  and  state  income  tax purposes of $24 million and  $12  million,
respectively.  The federal net  operating  loss carryforward expires in the
years  2006  through  2012  and the state net operating  loss  carryforward
expires in 1998 through 2002.   The Company expects that annual limitations
on the use of loss carryforwards  generated  before September 13, 1993 will
result in  $3.6 million of net operating loss  carryovers  which may not be
utilized prior to the expiration of the carryover period.

Net Loss

Net loss increased $184,000 or 23% for the nine months ended March 31, 1998
compared to the same period in fiscal 1997.  Net loss increased  $91,000 or
50%  for  the quarter ended March 31, 1998 compared to the same quarter  in
fiscal 1997.

Net Loss Per Share

The Company's  net  loss  per  share has been computed by dividing net loss
after deducting Preferred Stock  dividends  ($30,625  in  each of the three
months  ended  March  31,  1998 and 1997, and $91,875 in each of  the  nine
months ended March 31, 1998 and 1997, respectively) by the weighted average
number of shares of Common Stock  outstanding during the periods presented,
including Common Stock to be issued,  after  giving effect to the Company's
one-for-ten consolidation of Common Stock approved  by  the stockholders on
November 21, 1996, and effective December 2, 1996.

Liquidity and Capital Resources

Since its inception, the Company has used a combination of  equity and debt
financing  and  internal cash flow to fund operations and finance  accounts

<PAGE>9

PART I.  FINANCIAL INFORMATION
Item 2.  Management's Discussion and Analysis and Results of Operations

receivable.  The  Company  expects  to  generate  positive  cash  flow from
operations  during  fiscal  1998,  but not at levels sufficient to pay  off
current  obligations  and  fund  rapid  growth  of  its  contract  computer
programming  and consulting services; therefore  the  Company  contemplates
needing to raise additional financing during fiscal 1998.

The report of independent auditors on the Company's June 30, 1997 financial
statements  includes   an   explanatory   paragraph   indicating  there  is
substantial  doubt  about  the  Company's ability to continue  as  a  going
concern.   The financial statements  do  not  include  any  adjustments  to
reflect the  uncertainties related to the recoverability and classification
of assets or the  amounts and classification of liabilities that may result
from the inability of the Company to continue as a going concern.  Based on
the steps the Company  has  taken  to  reduce  its expenses and refocus its
operations, the Company believes that it has developed  a  viable  plan  to
address  the Company's ability to continue as a going concern and that this
plan will enable the Company to continue as a going concern through the end
of fiscal  year  1998.   However,  considering,  among  other  things,  the
Company's historical operating losses and its short history in the contract
computer  programming  industry,  there  can be no assurance that this plan
will  be  successfully  implemented.    The  Company   received  short-term
financing in the form of notes payable totaling $1.0 million  during fiscal
1997  and  totaling  $0.7 million during fiscal 1996 from two stockholders,
James W. Cameron, Jr.  ("Cameron") and Dr. Max Negri ("Negri"), to fund its
operations.   The  Company   borrowed   another  $1.2  million  from  these
stockholders during the first nine months  ended  March  31,  1998.   These
notes mature on December 31, 1998 and bear interest at 10.25%.  The Company
must  obtain  additional  funds  during  fiscal  1998  in order to meet its
obligations  while  attempting  to  grow revenues to a level  necessary  to
generate cash from operations.  Although  the  Company has not entered into
any written agreement with Cameron or Negri, management  believes, based on
discussions  with  these two individuals, that these two stockholders  will
continue to finance  the  Company's  operations  during  fiscal  1998.   In
December 1997, Cameron and Negri extended the maturity date on $2.6 million
in  notes  payable  from  December 31, 1997, to the earlier of December 31,
1998, or such time as the Company  obtains  equity financing.  Although the
Company has not entered into any written agreement  with  Cameron or Negri,
management believes, based on discussions with these two individuals,  that
Cameron  and Negri will continue to fund operations and extend the maturity
dates of the various notes payable until such time as the Company can repay
the notes.   However, there can be no assurance that events may arise which
may affect these  stockholders'  ability to finance the Company or that the
Company may experience significant  and  unanticipated  cash  flow problems
which  may  cause  these  two  stockholders to reconsider their investment.
Further, if the Company experiences  significant  cash  flow  problems, the
Company may be required to reduce the level of its operating activities  or
be forced into seeking protection under federal bankruptcy laws.

On  April 21, 1997, the Company issued a note payable (the "Straight Note")
to Cameron for  $1,000,000 in accordance with a Reimbursement Agreement the
Company  signed  on  February  28,  1994.  Terms of the note provide for an
interest rate of 9.5% and monthly interest  payments.   No maturity date is
stated  in  the  note;  however,  under  the  terms  of  the  Reimbursement
Agreement,  upon  written  demand  by  Cameron,  the Straight Note will  be
replaced  by  a convertible note (the "Convertible Note")  in  a  principal
amount equal to the Straight Note and bearing interest at the same rate.  

<PAGE>10

PART I.  FINANCIAL INFORMATION
Item 2.  Management's Discussion and Analysis and Results of Operations

The conversion ratio of the Convertible Note is equal to  20%  multiplied by
the  average  trading  price  of the Company's  Common  Stock  over the 
period of ten trading days ending on the trading day next preceding the date 
of issuance of such Convertible Note.

Effects of Inflation

The Company's most significant  cost is personnel.  To the extent personnel
costs increase, management of the  Company  believes  that customer billing
rates can be increased to cover such personnel cost increases.

<PAGE>11

PART II.    OTHER INFORMATION

Items 1, 2, 3, 4, 5, 6

None


Reports on Form 8-K

There were no reports on Form 8-K filed during the last quarter of the
period covered by this report.

<PAGE>12

                            SIGNATURES


In accordance with 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.

                                  ALTERNATIVE TECHNOLOGY RESOURCES, INC.
                                  (formerly known as 3Net Systems, Inc.)
                                                (Registrant)


Dated:  May 12, 1998                 W. ROBERT KEEN

                                    W. Robert Keen
                                    Chief Executive Officer
                                    (Principal Executive Officer)


Dated:  May 12, 1998                  EDWARD L. LAMMERDING

                                     Edward L. Lammerding
                                     Chief Financial Officer
                                     (Principal Financial Officer)




</TABLE>