EXHIBIT 10.2

                          ELCOTEL, INC.            

                   DIRECTORS STOCK OPTION PLAN
              (as amended through December 5, 1997)


     1.  Definitions
         -----------
          As used in this Plan, the following definitions apply
to the terms indicated below:

          A.   "Board" means the Board of Directors of the Com-
pany.

          B.   "Committee" means the Compensation and Stock
Option Committee appointed by the Board from time to time to
administer the Plan. The Committee shall consist of at least two
persons, who shall be directors of the Company.  

          C.   "Company" means Elcotel, Inc., a Delaware corp-
oration.

          D.   "Director" means a member of the Board who is not
an employee of the Company.

          E.   "Fair Market Value" of a Share on a given day
means, if the Shares are traded in a public market, the mean
between the highest and lowest quoted selling prices of a Share
as reported on the principal securities exchange on which the
Shares are then listed or admitted to trading, or if not so re-
ported, the mean between the highest and lowest quoted selling
prices of a Share, or the mean between the highest asked price
and the lowest bid price as the case may be, as reported on the
National Association of Securities Dealers Automated Quotation
System.  If the Shares shall not be so traded, the Fair Market
Value shall be determined by the Committee taking into account
all relevant facts and circumstances.

          F.   "Grantee" means a person to whom an Option is
granted. 

          G.   "Option" means a right to purchase Shares under
the terms and conditions of this Plan as evidenced by an option
certificate or agreement for Shares in such form, not inconsis-
tent with this Plan, as the Committee may adopt for general use
or for specific cases from time to time.

          H.   "Plan" means this Elcotel, Inc. Directors Stock
Option Plan, including any amendments to the Plan.  

<PAGE>

          I.   "Share" means a share of the Company's common
stock, par value $.01 per share, either now or hereafter owned by
the Company as treasury stock or authorized but unissued.  

          J.   As used herein, the masculine includes the femi-
nine, the plural includes the singular, and the singular includes
the plural.


     2.   Purpose
          -------
          The purposes of the Plan are as follows.

          A.   To secure for the Company and its shareholders the
benefits arising from share ownership by Directors.  The Plan is
intended to provide an incentive to Directors by providing them
with an opportunity to acquire an equity interest or increase an
existing equity interest in the Company, thereby increasing their
personal stake in its continued success and progress.

          B.   To enable the Company and its Subsidiaries to ob-
tain and retain the services of Directors, by providing Directors
with an opportunity to acquire Shares under the terms and condi-
tions and in the manner contemplated by this Plan.


     3.   Plan Adoption and Term
          ----------------------
          A.   This Plan shall become effective upon its adoption
by the Board, and Options shall be issued from time to time
thereafter; provided, however, that the Plan shall be submitted
to the Company's shareholders for their approval at the next
annual meeting of shareholders, or prior thereto at a special
meeting of shareholders expressly called for such purpose; and
provided further, that the approval of the Company's shareholders
shall be obtained within 12 months of the date of adoption of the
Plan.  If the Plan is not approved by the affirmative vote of the
holders of a majority of all shares present in person or by
proxy, at a duly called shareholders' meeting at which a quorum
representing a majority of all voting stock is present in person
or by proxy and voting on this Plan, then this Plan and all Op-
tions then outstanding under it shall forthwith automatically
terminate and be of no force and effect.

          B.   Subject to the provisions hereinafter contained
relating to amendment or discontinuance, this Plan shall continue
to be in effect for ten (10) years from the date of adoption of
this Plan by the Board.  No Options may be granted hereunder
except within such period of ten (10) years.

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<PAGE>

     4.   Administration of Plan
          ----------------------
          A.   This Plan shall be administered by the Committee.
Except as otherwise expressly provided in this Plan, the Commit-
tee shall have authority to interpret the provisions of the Plan,
to construe the terms of any Option, to prescribe, amend and res-
cind rules and regulations relating to the Plan, to determine the
terms and provisions of Options granted hereunder, and to make
all other determinations in the judgment of the Committee neces-
sary or desirable for the administration of the Plan.  The
Committee may correct any defect or supply any omission or
reconcile any inconsistency in the Plan or in any Option in the
manner and to the extent it shall deem expedient to carry the
Plan into effect and shall be the sole and final judge of such
expediency.

          B.   No member of the Committee shall be liable for any
action taken or omitted or any determination made by him in good
faith relating to the Plan, and the Company shall indemnify and
hold harmless each member of the Committee and each other direc-
tor or employee of the Company to whom any duty or power relating
to the administration or interpretation of the Plan has been
delegated against any cost or expense (including counsel fees) or
liability (including any sum paid in settlement of a claim with
the approval of the Committee) arising out of any act or omission 
in connection with the Plan, unless arising out of such person's
own fault or bad faith.

          C.   Any power granted to the Committee may at any time
be exercised by the Board, and any determination by the Committee
shall be subject to review and reversal or modification by the
Board on its own motion.


     5.   Options
          -------
          A.   Subject to adjustment as provided in Paragraph 12
hereof, an Option shall be granted to each Director on the last
business day of each fiscal year of the Company for the purchase
of (i) 1,000 Shares for each committee on which such Director is
then serving; and (ii) 1,000 Shares for each committee of which
such Director is then the chairperson.  Subject to adjustment as
provided in Paragraph 12 hereof, a new Director shall receive a
one-time automatic grant of an option to purchase 4,000 Shares at
the time such Director is either elected by the shareholders to
serve on the Board or appointed by the Board to fill a vacancy.

          B.   Subject to adjustment as provided in Paragraph 12
hereof, Options may be granted pursuant to the Plan for the
purchase of not more than 225,000 Shares; provided, however, that
if prior to the termination of the Plan, an Option shall expire
or terminate for any reason without having been exercised in
full, the unpurchased Shares subject thereto shall again be
available for the purposes of the Plan.

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<PAGE>

     6.   Option Price
          ------------
          The purchase price per Share deliverable upon the
exercise of an Option shall be the greater of:

          (1)  100% of the Fair Market Value of such Share on the
date the Option is granted, and 

          (2)  $2.00. 


     7.   Duration of Options
          -------------------
          Each Option and all rights thereunder shall expire and
the Option shall no longer be exercisable on a date five (5)
years from the date on which the Option was granted.  Options
shall be subject to termination before their expiration date as
provided herein.


     8.   Conditions Relating to Exercise of Options
          ------------------------------------------
          A.   The Shares subject to any Option may be purchased
at any time during the term of the Option beginning on the first
anniversary date of the date of the grant of such Option.  To the
extent an Option is not exercised when it becomes initially exer-
cisable, or is exercised only in part, the Option or remaining
part thereof shall not expire but shall be carried forward and
shall be exercisable until the expiration or termination of the
Option.  Partial exercise as to whole Shares is permitted from
time to time, provided that no partial exercise of an Option
shall be for a number of Shares having a purchase price of less
than $1,000.

          B.   No Option shall be transferable by the Grantee
thereof other than by will or by the laws of descent and distri-
bution, and Options shall be exercisable during the lifetime of a
Grantee only by such Grantee or by his or her guardian or legal
representative.

          C.   Certificates for Shares purchased upon exercise of
Options shall be issued either in the name of the Grantee or in
the name of the Grantee and another person jointly with the right
of survivorship.  Such certificates shall be delivered as soon as
practical following the date the Option is exercised.

          D.   An Option shall be exercised by the delivery to
the Company at its principal office, to the attention of its
Secretary, of written notice of the number of Shares with respect
to which the Option is being exercised, and of the name or names

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<PAGE>

in which the certificate for the Shares is to be issued, and by
paying the purchase price for the Shares.  The purchase price
shall be paid in cash or by certified check or bank cashier's
check.  Alternatively, to the extent permitted by the Committee
and in its sole discretion, the purchase price may be paid by
delivering to the Company: 

               (1)   Shares (in proper form for transfer and
accompanied by all requisite stock transfer tax stamps or cash in
lieu thereof) owned by the Grantee having a Fair Market Value
equal to the purchase price; or 

               (2)  a notarized statement attesting to ownership
of the number of Shares which are intended to be used at Fair
Market Value to pay the purchase price, with the certificate
number(s) thereof, and requesting that only the incremental
number of Shares as to which the Option is being exercised be
issued by the Company.

          E.   Notwithstanding any other provision in this Plan,
no Option may be exercised unless and until (i) this Plan has
been approved by the shareholders of the Company, and (ii) the
Shares to be issued upon the exercise thereof have been regis-
tered under the Securities Act of 1933 and applicable state se-
curities laws, or are, in the opinion of counsel to the Company,
exempt from such registration.  The Company shall not be under
any obligation to register under applicable Federal or state
securities laws any Shares to be issued upon the exercise of an
Option granted hereunder, or to comply with an appropriate exemp-
tion from registration under such laws in order to permit the
exercise of an Option or the issuance and sale of Shares subject
to such Option.  If the Company chooses to comply with such an
exemption from registration, the certificates for Shares issued
under the Plan, may, at the direction of the Committee, bear an
appropriate restrictive legend restricting the transfer or pledge
of the Shares represented thereby, and the Committee may also
give appropriate stop-transfer instructions to the transfer agent
of the Company.

          F.   Any person exercising an Option or transferring or
receiving Shares shall comply with all regulations and require-
ments of any governmental authority having jurisdiction over the
issuance, transfer or sale of securities of the Company or over
the extension of credit for the purposes of purchasing or carry-
ing any margin securities, or the requirements of any stock ex-
change on which the Shares may be listed, and as a condition to
receiving any Shares, shall execute all such instruments as the
Committee in its sole discretion may deem necessary or advisable.

          G.   Each Option shall be subject to the requirement
that if the Committee shall determine that the listing, regis-
tration or qualification of the Shares subject to such Option
upon any securities exchange or under any state or Federal law,
or the consent or approval of any governmental or regulatory
body, is necessary or desirable as a condition of, or in connec-
tion with, the granting of such Option or the issuance or pur-
chase of Shares thereunder, such Option may not be exercised in
whole or in part unless such listing, registration, qualifica-
tion, consent or approval shall have been effective or obtained
free of any conditions not acceptable to the Committee.

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<PAGE>

     9.   Effect of Termination of Directorship or Death
          ----------------------------------------------
          A.   In the event of termination of a Grantee's status
as a Director by reason of such Grantee's death or disability,
any outstanding Option held by such Grantee shall, notwithstand-
ing the extent to which such Option was exercisable prior to such
termination, immediately became exercisable as to the total
number of Shares purchasable thereunder.  Any such Option shall
remain so exercisable at any time prior to its expiration date
or, if earlier, only until the first anniversary of termination
of the Grantee's status as a Director.

          B.   In the event of termination of a Grantee's status
as a Director for any reason other than death or disability, any
outstanding Option held by such Grantee shall remain exercisable
at any time prior to its expiration date or, if earlier, only
until the date thirty days after the termination of Director
status.

          C.   Whether an authorized leave of absence or absence
in military or government service shall constitute termination of
status as a Director shall be determined by the Committee.


     10.  No Special Rights
          -----------------
          Nothing contained in the Plan or in any Option shall
confer upon any Grantee any right with respect to the continua-
tion of his or her status as a Director or interfere in any way
with the right of the Company at any time to terminate such
status or to increase or decrease the compensation of the Grantee
from the rate in existence at the time of the grant of an Option. 



     11.  Rights as a Shareholder
          -----------------------
          The Grantee of an Option shall have no rights as a
shareholder with respect to any Shares covered by an Option until
 the date of issuance of a certificate to him for such Shares.
Except as otherwise expressly provided in the Plan, no adjustment
shall be made for dividends or other rights for which the record
date occurs prior to the date of issuance of such certificate.

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<PAGE>

     12.  Anti-dilution Provision
          -----------------------
          A.   In case the Company shall (i) declare a dividend
or dividends on its Shares payable in shares of its capital
stock, (ii) subdivide its outstanding Shares, (iii) combine its
outstanding Shares into a smaller number of Shares, or (iv) issue
any shares of capital stock by reclassification of its Shares
(including any such reclassification in connection with a consol-
idation or merger in which the Company is the continuing corpora-
tion), the number of Shares authorized under the Plan will be
adjusted proportionately.  Similarly, in any such event, there
will be a proportionate adjustment in the number of Shares
subject to unexercised Options (but without adjustment to the
aggregate option price).

          B.   In the event of any kind of transaction which may
constitute a change in control of the Company, the Committee,
with the approval of the majority of the members of the Board who
are not then holding Options, may modify any and all outstanding
Options so as to accelerate, as a consequence of or in connection
with such transaction, a Grantee's right to exercise any such
Option.  


     13.  Amendment of the Plan
          ---------------------
          The Board may at any time and from time to time termi-
nate or modify or amend the Plan in any respect, except that

          (1)  without shareholder approval, the Board may not
(a) materially increase the number of securities which may be
issued under the Plan or (b) materially modify the requirements
as to eligibility for participation under the Plan; and

          (2)  the Plan provisions governing the amounts and
purchase prices of Shares and the requirements as to eligibility
for participation may not be amended more than once every six (6)
months, other than to comport with changes in the Internal
Revenue Code or the rules thereunder.  

The termination or modification or amendment of the Plan shall
not, without the consent of a Grantee, affect his rights under an
Option previously granted to him or her.  


     14.  Miscellaneous
          -------------
          A.   It is expressly understood that this Plan grants
powers to the Committee but does not require their exercise; nor
shall any rights begin to accrue under the Plan except as Options
may be granted hereunder.

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<PAGE>

          B.   All expenses of the Plan, including the cost of
maintaining records, shall be borne by Company.

     15.  Governing Law
          -------------
          This Plan and all rights hereunder shall be governed by
and interpreted in accordance with the laws of the State of
Delaware.


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