UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    FORM 10-Q

(Mark One)
[ x ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
            OF THE  SECURITIES  EXCHANGE  ACT OF 1934 For the  quarterly  period
ended June 30, 1998.
                                       OR
[    ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
 OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________ to ___________.

Commission file number 000-21153.

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

               DELAWARE                                 33-0709359
    (State or other jurisdiction of                  (I.R.S. Employer
    incorporation or organization)                  Identification No.)

             16761 Hale Avenue, Irvine, California 92606 (Address of
                principal executive offices, including zip code)

                                 (949) 475-1525
              (Registrant's telephone number, including area code)

                                 Not applicable
              (Former name, former address and former fiscal year,
                         if changed since last report)

      Indicate by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.
Yes [ x ]   No [   ]

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

      Indicate the number of shares  outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.

Common Stock, $.001 par value; 10,750,000 shares as of July 24, 1998 .


<PAGE>


                                ALYN CORPORATION

                                      INDEX

--------------------------------------------------------------------------------

                                                                     Page Number

PART I.     FINANCIAL INFORMATION

      Item 1.  Financial Statements

            Condensed Balance Sheets -
                  June 30, 1998 (unaudited) and December 31, 1997             3

            Condensed Statements of Operations -  
                  Three months ended June 30, 1998(unaudited) and 
                  June 30, 1997 (unaudited) and six months ended
                  June 30, 1998 (unaudited) and June 30, 1997 (unaudited)     4

            Condensed Statements of Stockholders' Equity  -
                  Six months ended June 30, 1998 (unaudited)                  5

            Condensed  Statements  of Cash Flows -
                  Six months  ended June 30, 1998(unaudited) 
                  and June 30, 1997 (unaudited)                               6

            Notes to Condensed Financial Statements
                  (unaudited)                                                 7

      Item 2.     Management's Discussion and Analysis of Financial
                  Condition and Results of Operations                       8-9

      Item 3.     Quantitative and Qualitative Disclosures About
                  Market Risk                                                 9


PART II.    OTHER INFORMATION                                                10


SIGNATURES                                                                   11


<PAGE>



                                Alyn Corporation
                            Condensed Balance Sheet
                                  (Unaudited)


                                                      June 30,      December 31,
                                                        1998            1997
                                                        ----            ----

                                     Assets

Current assets:
    Cash and cash equivalents                        $ 8,018,000     $13,126,000
    Accounts receivable, net                              75,000          94,000
    Inventories                                          358,000         172,000
    Other current assets                                 105,000         201,000
                                                     -----------     -----------
Total current assets                                   8,556,000      13,593,000

    Equipment, furniture and fixtures, net            20,885,000      13,302,000
    Other assets, net                                    957,000       3,454,000
    Intangibles, net                                     732,000         778,000
                                                     -----------     -----------
                                                     $31,130,000     $31,127,000
                                                     ===========     ===========


                      Liabilities and Stockholders' Equity

Current liabilities:
    Accounts payable                                  $ 1,270,000   $   551,000
    Current portion of long term debt                   1,698,000       999,000
    Accrued and other current                             324,000       326,000
                                                        ---------     ---------
Total current liabilities                               3,292,000     1,876,000

    Long term debt                                      8,343,000     5,501,000

Stockholders' equity:
   Common stock                                            11,000        11,000
   Additional paid-in capital                          35,700,000    33,294,000
   Stock subscriptions receivable                        (407,000)            -
   Accumulated deficit                                (15,809,000)   (9,555,000)
                                                      ------------   -----------
   Total stockholders' equity                          19,495,000    23,750,000
                                                      ------------  ------------
                                                      $31,130,000   $31,127,000
                                                      ============  ============

See Notes to Condensed Financial Statements.


<PAGE>



                                Alyn Corporation
                        Condensed Statement of Operations
                                   (Unaudited)


                                    Three Months Ended       Six Months Ended
                                           June 30,               June 30,

                                      1998       1997        1998        1997
                                      ----       ----        ----        ----

Net Sales                        $   32,000   $ 182,000   $  61,000  $  209,000
Contract revenue                       --        30,000        --        45,000
                                   --------    --------    --------    --------
Total revenue                        32,000     212,000      61,000     254,000
 
Costs and expenses:
Cost of goods sold                1,322,000     194,000   1,910,000     217,000
Establishment of manufacturing          
  facilities                             -      293,000          -      518,000
General and administrative        1,005,000     709,000   1,667,000   1,139,000
Selling and marketing               298,000     295,000     599,000     665,000
Research and development            797,000     420,000   1,953,000     645,000 
                                  ---------   ---------   ---------   ---------
 Total costs and expenses         3,422,000   1,911,000   6,129,000   3,184,000
                                  ---------   ---------   ---------   ---------
Operating loss                   (3,390,000) (1,699,000) (6,068,000) (2,930,000)

Other income/(expense)             (148,000)    235,000    (185,000)    524,000
                                  ---------- ----------  ----------   ---------
Loss before provision for
income taxes                     (3,538,000) (1,464,000) (6,253,000) (2,406,000)

Provision for income taxes                -      10,000       1,000      11,000
                                 ----------  ----------  ----------  -----------
                                ($3,538,000)($1,474,000)($6,254,000)($2,417,000)

Basic and diluted net loss 
per share                            ($0.33)     ($0.14)     ($0.58)     ($0.22)

Common shares used in computing
basic and diluted net loss
per share                        10,750,000  10,750,000  10,750,000  10,750,000



See Notes to Condensed Financial Statements.



<PAGE>



                                 Alyn Corporation
                   Condensed Statement of Stockholders' Equity
                                   (Unaudited)

                                           Additional     Stock
                          Common Stock      Paid-in   Subscriptions  Accumulated
                         Shares   Amount    Capital     Receivable      Deficit
                      ------------------  -----------  ------------  -----------
Balance at    
December 31, 1997     10,750,000 $10,750  $33,294,000               ($9,555,000)

Common Stock 
Subscribed               370,000     370    2,406,000

Stock Subscription                          
Receivable                                              ($407,000)

Net loss                                                             (6,254,000)
                      ----------  -------  -----------  ----------  ------------
Balance at 
June 30,1998          11,120,000  $11,000  $35,700,000  ($407,000) ($15,809,000)
                      ==========  =======  ===========  ========== =============
                                                                     




See Notes to Condensed Financial Statements.




<PAGE>



                           Alyn Corporation
                   Condensed Statement of Cash Flows



                                                   Six Months Ended
                                                       June 30,
                                                 1998             1997
                                                 ----             ----


Cash flows used in operating                  ($4,645,000)    ($3,325,000)
activities:

Cash flows used in investing activities:
Capital expenditures                           (6,004,000)     (5,973,000)

Cash flows from financing activities:
Proceeds from long term debt (net)              3,541,000              -
Proceeds from common stock subscription         2,000,000              -
                                                ---------      -----------
Total cash flows from financing activities      5,541,000              -
 
Net (decrease) increase  in cash               (5,108,000)     (9,298,000)

Cash and cash equivalents at                         
beginning of period                            13,126,000      24,411,000
                                               ----------      ----------

Cash and cash equivalents at end of period    $ 8,018,000     $15,113,000
                                              ===========     ===========



See Notes to Condensed Financial Statements



<PAGE>


                                ALYN CORPORATION
                          NOTES TO FINANCIAL STATEMENTS


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 with the  instructions to Form 10-Q and Article 10 of
Regulation  S-X.  Accordingly,  they do not include all of the  information  and
footnotes  required by generally  accepted  accounting  principles  for complete
financial statements. In the opinion of management,  all adjustments (consisting
of normal recurring accruals)  considered necessary for a fair presentation have
been included. This financial information should be read in conjunction with the
audited  financial  statements and notes thereto for the year ended December 31,
1997,  included in the Company's Form 10-K, which is on file with the Securities
and  Exchange  Commission.  Operating  results for the six months ended June 30,
1998 are not necessarily  indicative of the results that may be expected for the
year ended December 31, 1998.
      Cost of goods sold includes,  in addition to the costs associated with the
sales  for the first two  quarters  of 1998 all  labor,  material  and  overhead
pertaining to the Company's under-utilization of production capacity.

2. Inventories
                                        June 30,      December 31,
                                          1998           1997
    Inventories:
      Raw materials                     $358,000       $157,000
      Finished goods                           -         15,000
                                        --------       --------
                                        $358,000       $172,000
                                        ========       ========

3. Stock Subscription Rights

      On June 29,  1998 the  Company  filed a  registration  statement  with the
Securities  and Exchange  Commission  in connection  with the  Company's  Rights
Offering to  subscribe  for an  aggregate  of 1.6 million  shares of Alyn Common
Stock. The Company amended the original registration  statement on July 15, 1998
to increase the number of shares to 1.9 million shares. The Rights Offering,  if
fully  subscribed  for,  will  increase  Alyn's  outstanding  shares by only 1.4
million shares because Robin A. Carden,  the Company's  Founder will transfer to
the company  without  charge,  500,000  shares of Alyn Common Stock.  The Rights
Offering granted each shareholder of record on July 15, 1998 one Right for every
5.65803  shares of Alyn Common Stock owned.  The exercise per Right is $5.50 and
the Rights expire on August 28, 1998. The Company had received $2.0 million from
a principal  stockholder as an advance of the  subscription  price due from such
principal stockholder.



<PAGE>



Item 2.        MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS

Overview

      Since its  inception  in 1990,  the Company has been  engaged in research,
development, testing of its advanced metal matrix composite materials. Following
its  initial  public  offering in October  1996,  the Company has focused on the
establishment  of  manufacturing  facilities  and prototype  production of metal
matrix  composite  products.  In 1997 and the  first  two  quarters  of 1998 the
Company's sales were primarily the result of prototype orders. The Company is in
transition from establishing  manufacturing facilities and prototype development
to production.  An initial  production  order for metal wood golf club heads was
received from Taylor Made Golf Company in June 1998 and the Company has received
prototype  development  orders  from two other  major  golf club  manufacturers.
Boralyn(R)  -based golf club shaft  prototypes  are in True Temper Sports' field
testing program for evaluation.  Shipments have begun for aerospace applications
utilizing both Boralyn(R) and hard-alloy aluminum. Development work continues in
the  Company's  disk  substrate  program.  Production  of the engine  cradle for
General Motors began in June 1998, with the first  shipments  scheduled for July
1998.  While the Company expects to achieve sales of Boralyn(R)  -based products
in 1998, there can be no assurance that any significant  sales will be achieved.
The Company was  unprofitable  through June 30, 1998 and incurred a loss for the
full year 1997 as a result of start-up  expenses in  anticipation  of production
orders, and will incur additional losses thereafter.

Results of Operations

For purposes of discussion, the results of operations for the three-month period
ended  June  30,  1998  are  compared  to the  results  of  operations  for  the
three-month  period  ended June 30, 1997 and the results of  operations  for the
six-month  period ended June 30, 1998 are compared to the six-month period ended
June 30, 1997.

      Total  revenues for the second  quarter of 1998  decreased  85% to $32,000
from $212,000 in the second  quarter of 1997.  Total  revenues for the six-month
period  ended June 30,  1998  decreased  71% to  $61,000  from  $254,000  in the
six-month period ended June 30, 1997. The decrease in revenues is not considered
significant.

      Cost of goods  sold  for the  second  quarter  of 1998  increased  582% to
$1,322,000  from $194,000 in the second quarter of 1997.  Cost of goods sold for
the  six-month  period ended June 30, 1998  increased  781% to  $1,910,000  from
$217,000 in the six-month  period ended June 30, 1997.  All labor,  material and
overhead costs not  attributable  to internal R & D projects were  classified as
Cost of goods sold in 1998. In 1997,  prior to completion of the Company's first
manufacturing  facility, only labor, material and overhead associated with sales
went to Cost of goods  sold  with the  remainder  charged  to  Establishment  of
manufacturing facilities.

      There were no expenses for the  Establishment of manufacturing  facilities
during 1998. In 1997,  $518,000 of expenses incurred for the startup and testing
of  production   equipment  were  charged  to   Establishment  of  manufacturing
facilities.

      General  and  administrative  expenses  for  the  second  quarter  of 1998
increased 42% to $1,005,000 from $709,000 in the second quarter of 1997. General
and  administrative  expenses  for the  six-month  period  ended  June 30,  1998
increased 46% to $1,667,000 from  $1,139,000 in the six-month  period ended June
30, 1997.  The increase  represents the costs incurred as a result of increasing
the Company's  administrative employee base, including a new CEO in April, 1998.
These expenses are not expected to increase until the Company begins production.

      Research and development expenses for the second quarter of 1998 increased
90% to  $797,000  from  $420,000  in the second  quarter of 1997.  Research  and
development expenses for the six-month period ended June 30, 1998 increased 203%
to $1,953,000  from $645,000 in the six-month  period ended June 30, 1997.  This
increase was attributable to an increase in internal development of products the
Company  anticipates  producing.  The Company  expects to continue  investing in
research and development of new applications of Boralyn(R).



Liquidity and Capital Resources

      At June 30,  1998,  the  Company had working  capital of  $5,671,000.  The
Company has funded its  operations  through  proceeds  from its  initial  public
offering in October 1996 of $33.3  million,  net of  expenses,  and through debt
financing of $10.5  million,  $6.5 million  completed in December 1997, and $4.0
million  completed in the second quarter of 1998. The Company announced a Common
Stock Rights Offering on June 29, 1998 that is anticipated to yield net proceeds
of approximately $10 million to the Company. As of June 30, 1998 the Company had
received $2 million in subscription advances from the offering. Cash balances in
excess of those  required to fund  operations  are invested in  interest-bearing
high quality  short-term  investment  grade corporate  securities and government
securities in accordance  with investment  guidelines  approved by the Company's
Board of Directors.

      The Company's  future  liquidity  and capital  funding  requirements  will
depend on numerous  factors,  including  results of  marketing  its metal matrix
composite capabilities, their acceptance in the market, the timing of production
orders and their delivery and the costs and timing of growth in sales, marketing
and manufacturing activities. The Company intends to use debt financing for some
of its existing and future  capital  needs.  The Company  believes  that the net
proceeds  from the rights  offering,  together  with cash flow from  operations,
current cash balances, and bank line of credit will be sufficient to finance its
working and other capital requirements for the next eighteen months.

      Except for historical  information  contained herein,  this report on Form
10-Q  contains  forward-looking  statements  within the  meaning of the  Private
Securities  Litigation  Reform Act of 1995. These  statements  involve known and
unknown risks and  uncertainties  that may cause the Company's actual results or
outcomes to be materially different from those anticipated and discussed herein.
Further,  the Company operates in an industry sector where securities values may
be volatile and may be  influenced by  regulatory  and other factors  beyond the
Company's control.  Important factors that the Company believes might cause such
differences  are  discussed  in  the  cautionary  statements   accompanying  the
forward-looking  statements in the Company's  Annual Report on Form 10-K, in the
risk factors  detailed in the  Company's  Annual  Report on Form 10-K and in the
Company's Prospectus dated July 15, 1998, filed with the Securities and Exchange
Commission.  In assessing  forward-looking  statements contained herein, readers
are  urged  to  read  carefully  all  cautionary  statements  contained  in this
quarterly report, in those filings with the Securities and Exchange Commission

Item 3.           Quantitative and Qualitative Disclosures About Market Risk

            Not Applicable



<PAGE>


                                ALYN CORPORATION

PART II.  OTHER INFORMATION


ITEM 1.  LEGAL PROCEEDINGS

      None.

ITEM 2.  CHANGES IN SECURITIES

      None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

      None.

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

The results of the Annual Meeting of Stockholders  held on June 3, 1998 were as
follows:

Total Shares voted       4,344,405

The election of the following directors:
                                                          Broker
Director                      For         Withheld       Non-Votes

Steven S. Price            4,336,105        8,300             0
Robin A. Carden            4,336,105        8,300             0
Walter R. Menetrey         4,336,305        8,100             0
Harry Edelson              4,335,405        9,000             0
Michael Markbreiter        4,335,505        8,900             0
Udi Toledano, Chairman     4,335,605        8,800             0

 
Ratified  PricewaterhouseCoopers  LLP as independent  accountants of the Company
     for its fiscal year ending December 31, 1998.

       For         Withheld       Abstain

    4,333,900        7,195         3,310



ITEM 5.  OTHER INFORMATION

                             STOCKHOLDER PROPOSALS

            The  eligibility of  stockholders  to submit  proposals,  the proper
      subjects of stockholder  proposals and other issues governing  stockholder
      proposals are regulated by the rules (the  "Stockholder  Proposal  Rules")
      adopted  under  Section  14 of the  Securities  Exchange  Act of 1934,  as
      amended (the "Exchange Act").  Stockholder proposals submitted pursuant to
      Rule 14a-8 under the Exchange Act for  inclusion  in the  Company's  proxy
      materials for the 1999 Annual Meeting of Stockholders  must be received by
      the Company at its principal executive office, 16761 Hale Avenue,  Irvine,
      CA 92606, no later than Monday, January 4, 1999.

            In addition, in accordance with recent amendments to the Stockholder
      Proposal  Rules,  written notice of stockholder  proposals to be submitted
      outside of Rule 14a-8 described above for consideration at the 1999 Annual
      Meeting of  Stockholders  must be received by the Company,  at the address
      set forth in the preceding  paragraph,  on or before  Thursday,  March 19,
      1999 in order to be  considered  timely for  purposes  of the  Stockholder
      Proposal  Rules.  The  persons  designated  as proxies  by the  Company in
      connection  with  the  1999  Annual  Meeting  of  Stockholders  will  have
      discretionary voting authority with respect to any stockholder proposal of
      which the Company did not receive timely notice.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K









<PAGE>


                                   SIGNATURES

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




                                ALYN CORPORATION
                                  (Registrant)






                                         By:  -------------------------------
                                              Steven  S.  Price
                                              President  and
                                              Chief Executive Officer







                                                                             
                                         By:  -------------------------------
                                              Richard L. Little
                                              Vice President, Finance and
                                              Administration and Chief
                                              Accounting and Financial Officer




Dated:  August 11, 1998