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, 1997
                                    OR

( ) TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the transition period from         to        

                     Commission file number   O-21831

                     International Sports Wagering Inc.            
     (Exact name of Small Business Issuer as specified in its charter)


       Delaware                                   22-3375134   
(State or other jurisdiction of             (IRS Employer
 incorporation or organization)             Identification No.)

201 Lower Notch Road, Little Falls, NJ         07424           
(Address of principal executive offices)       (Zip Code)


Issuer's telephone number, including area code: (201) 256-8181


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 report) and (2) has been subject to such
filing requirement for the past 90 days.
Yes  X    No     


There were 7,749,269 shares of Common Stock outstanding at May 7,
1997.


Transitional Small Business Disclosure Format (check one):
Yes       No  X 










                    International Sports Wagering Inc.
                              March 31, 1997
                                Form 10-QSB

                                   Index

                                                               Page
                                                           
Part I:   Financial Information

Item 1.   Financial Statements

          Balance Sheets at March 31, 1997 (Unaudited) and
          September 30, 1996.                                    2

          Statements of Operations for the Six and Three
          Months Ended March 31, 1997 and March 31, 1996 and    
          May 22, 1995 (date of inception) to March 31, 1997.
          (Unaudited).                                           3

          Statement of Changes in Stockholders' Equity for
          the Six Months Ended March 31, 1997 (Unaudited).       4

          Statements of Cash Flows for the Six Months Ended     
          March 31, 1997 and 1996 and May 22, 1995 (date of
          inception) to March 31, 1997 (Unaudited).              5

          Notes to Financial Statements.                         6 

Item 2.   Management's Discussion and Analysis of Financial      
          Condition and Results of Operations or Plan of        
          Operation.                                           7-10 

Part II:  Other Information

Item 5.   Other Events                                           11

Item 6.   Exhibits and Reports on Form 8-K.                      12 

Signatures                                                       13 












                                     1


                    International Sports Wagering Inc.
                       (A Development Stage Company)
                              Balance Sheets

                                  Assets

                                      March 31,     September 30,
                                        1997             1996  
                                     (Unaudited)       (Note 1)  

Current Assets:
  Cash and cash equivalents           $ 3,322,217      $ 537,546
  Short-term investments                4,457,548           --
  Prepaid expenses and other
    current assets                        224,346          8,885 

      Total Current Assets              8,004,111        546,431 

Property and Equipment, net               262,703        304,466 

Other Assets                               53,867          4,258 

Deferred Financing Costs                     --           46,406 

      Total Assets                    $ 8,320,681      $ 901,561

                   Liabilities and Stockholders' Equity

Current Liabilities:
  Accounts payable                     $    1,722      $  42,382
  Accrued expenses                         75,036        143,265 

    Total Current Liabilities              76,758        185,647 

Stockholders' Equity:
  Preferred stock, par value $.001
    per share; 2,000,000 shares
    authorized, none issued or
    outstanding                               --            -- 
  Common stock, par value $.001 per
    share; 20,000,000 shares
    authorized, 7,749,269 and
    6,024,269 shares issued and
    outstanding, respectively               7,749          6,024
  Additional paid-in capital           10,205,319      1,687,089
  Deficit accumulated during the
    development stage                  (1,969,145)      (977,199)

      Total Stockholders' Equity        8,243,923        715,914

      Total Liabilities and
        Stockholders' Equity          $ 8,320,681     $  901,561 

See Notes to Financial Statements


                                     2
                       International Sports Wagering Inc.
                         (A Development Stage Company)
                            Statements of Operations



                                                              May 22, 1995
                                                                (Date of  
                      Six Months Ended   Three Months Ended    Inception)
                         March 31,            March 31,        to March 31
                      1997      1996      1997        1996        1997     
 

Costs and Expense:
 Research and
  development
  expense           $412,105  $ 273,211  $ 232,832   $129,645   $1,203,400
 General and
  administrative
  expense            402,971     37,037    221,390     16,465      628,878

    Operating Loss  (815,076)  (310,248)  (454,222)  (146,110)  (1,832,278)
     
Interest expense    (299,098)     --        --            --      (299,098) 

Interest Income      122,228     11,589    103,358      4,379      162,231

    Net Loss       $(991,946) $(298,659) $(350,864) $(141,731) $(1,969,145)

Net Loss per share $    (.14) $    (.05) $    (.05) $    (.02) $      (.30)

Weighted average
 common shares
 outstanding       7,201,181  6,477,410  7,696,769  6,477,410    6,671,411














See Notes to Financial Statements

                       International Sports Wagering Inc.
                         (A Development Stage Company)
                  Statement of Changes In Stockholders' Equity
                    For the Six Months Ended March 31, 1997


                                                      Deficit
                                                    Accumulated
                                       Additional   During The  
                      Common Stock      Paid-In     Development
                    Shares   Amount     Capital        Stage       Total

Balance at
 September 30,1996 6,024,269 $ 6,024  $ 1,687,089  $  (977,199) $  715,914  

Net Loss                                              (991,946)   (991,946)

Issuance of
 Common Stock      1,725,000   1,725    8,518,230        --      8,519,955

Balance at
 March 31, 1997    7,749,269 $ 7,749  $10,205,319  $(1,969,145) $8,243,923 




























See Notes to Financial Statements

                       International Sports Wagering Inc.
                         (A Development Stage Company)
                            Statements of Cash Flows
                                                        May 22, 1995 
                                Six Months Ended           (Date of Inception)
                                    March 31,             to March 31,
                               1997         1996              1997      
Cash Flows from
 Operating Activities:
  Net Loss                 $ (991,946)  $ (298,659)    $ (1,969,145)
  Adjustment to
   reconcile net loss
   to net cash (Used in)
   operating activities:
    Depreciation and
     amortization              62,693        7,417          134,596
    Issuance of options
     to consultants              --           --             14,500
    Changes in assets
     and liabilities:
      Prepaid expenses
       and other current
       assets                (215,461)       2,003         (224,346)    
      Other assets            (50,001)        --            (55,307)    
      Accounts payable        (40,660)     (28,408)           1,722    
      Accrued expenses        (68,229)       4,781           75,036 
  Net Cash (Used In)
   Operating Activities    (1,303,604)    (312,866)      (2,022,944)

Cash Flows from Investing
 Activities:
  Short-term investments   (4,457,548)        --         (4,457,548)
  Purchase of property
   and equipment              (20,538)      (5,751)        (395,859)
    Net Cash (Used In)
     Investing Activities  (4,478,086)      (5,751)      (4,853,407)
Cash Flows from
 Financing Activities:
  Net Proceeds from
   issuance of common
   stock                    8,566,361      609,342       10,198,568

Net Increase in Cash
 and Cash Equivalents       2,784,671      290,725        3,322,217     

Cash and Cash Equivalents,
 Beginning of Period          537,546      694,810             --  

Cash and Cash Equivalents,
 End of Period            $ 3,322,217   $  985,535      $ 3,322,217
See Notes to Financial Statements

 
                    International Sports Wagering Inc.
                       Notes To Financial Statements

Note 1 -  Basis of Presentation:

        The balance sheet at the end of the preceding fiscal year
        has been derived from the audited balance sheet contained in
        the Company's Registration Statement on Form SB-2 filed with
        the Securities and Exchange Commission and is presented for
        comparative purposes.  All other financial statements
        presented are unaudited.  In the opinion of Management, all
        adjustments which include only normal recurring adjustments
        necessary to present fairly the financial position for all
        periods presented have been made.

        Footnote disclosures normally included in financial
        statements prepared in accordance with generally accepted
        accounting principles have been omitted in accordance with
        the published rules and regulations of the Securities and
        Exchange Commission.  These financial statements should be
        read in conjunction with the financial statements and notes
        thereto included in the Company's Registration Statement.

Note 2 -  Net Loss Per Share of Common Stock:            

        Pursuant to the Securities and Exchange Commission Staff
        Accounting Bulletin Topic 4:D, stock issued and stock
        options and warrants granted during the 12-month period
        preceding the date of the Initial Public Offering ("IPO")
        have been included in the calculation of weighted average
        common shares outstanding for the periods prior to the
        ("IPO"), even when the impact of such incremental shares is
        antidilutive.  The computation of weighted average common
        shares and equivalents outstanding as follows:

        Weighted average common shares outstanding,
        exclusive of issuances within 12 months
        prior to the ("IPO")                         4,791,522

        Shares, options and warrants issued in
        periods prior to and within 12 months prior
        to the ("IPO") assumed to be outstanding for
        the period                                   1,685,888

        Weighted average common shares applicable
        to ("IPO") and over-allotment option         1,219,359

        Weighted average common shares and
        equivalents outstanding                      7,696,769  




Item 2.      Management's Discussion and Analysis of Financial
          Condition and Results of Operations or Plan of 
          Operation. 


     On December 17, 1996, International Sports Wagering Inc.
(the "Company") closed its initial public offering of 1,500,000
units ("Units"), each Unit consisting of one share of common
stock, par value $.001 per share ("Common Stock"), and one
redeemable warrant to purchase one share of Common Stock
("Warrant"), at a price of $6.00 per Unit.  After underwriting
discounts and commissions, other expenses of the offering, and
the repayment of promissory notes issued in connection with a
bridge financing consummated on October 28,1996, the Company
received net proceeds of approximately $7.2 million.  On January
22,1997, the underwriters exercised an over-allotment option for
an additional 225,000 Units, yielding additional net proceeds to
the Company of approximately $1.2 million. See Part II, Item 5.

     On November 25,1996, the Company completed a live trial of
its SportXctionTM sports wagering system (the "System") at the
Excalibur Hotel & Casino ("Excalibur") in Las Vegas, Nevada, a
casino owned by Circus Circus Enterprises, Inc. ("Circus
Circus"), as one of the conditions for obtaining approval by
Nevada gaming authorities for use of the System.  The trial of
the System at Excalibur was continued until January 5, 1997 to
permit additional evaluation by Circus Circus.  On January
10,1997, the Company announced that it had received approval from
the Nevada Gaming Control Board (the "Board") for use of the
System in the State of Nevada.  The approval is limited to use of
the System in individual casinos or other sports wagering
establishments.

     The Company has commenced sales and marketing activities to
casinos and other sports wagering establishments in Nevada.  The
Company intends to open a sales, support and operations office in
Las Vegas, Nevada by the end of June 1997.  In addition to
general marketing of the System, the Company is in discussions
with potential establishments to operate a central hub until such
time as the Company receives a gaming license and any other
approvals necessary to permit it to operate the hub.  The process
for the Company to obtain a gaming license is expected to take
nine to twelve months from the date all required applications are
filed.  The Board may require the Company to obtain additional
approvals in order for it to be permitted to act as a hub
operator.  A central hub would link via telecommunications lines
the Company's Player Betting Stations located in individual
casinos or other gaming establishments, resulting in larger
combined pools, reduced operating costs and improved efficiency
for participating gaming establishments.  The Company has
completed certain software adaptations necessary to implement its
strategy of using a central hub.

     In June 1997, the Company expects to begin a live trial
utilizing a central hub linking multiple sites in Nevada.  This
is one of the conditions for obtaining approval from the Board
for use of the System at multiple sites linked to a central hub. 
Prior to operation of a central hub, the hub operator would be
required to have proper licensing or other approval from the
Board.  The hub operator may also be required to obtain
additional licenses or other approvals to link each individual
participating gaming establishment to the hub.

     When and if the Company is issued a gaming license, it
intends to assume control and operation of the hub.  It is the
Company's goal to commence live operation of a central hub by
September 1997. However, there can be no assurance that the live
trial will commence on a timely basis or be successfully
completed or that the Board will issue the approvals necessary
for operation of the central hub, either by the Company or a
third party, or that the Company will be issued a gaming license.

     The Company's plan of operation during the next 12 months
focuses primarily on (i) sales and marketing to casinos and other
sports book operators in Nevada, (ii) the hiring of additional
personnel in the areas of sales and marketing, equipment
installation, maintenance and training, (iii) continued research
and further product enhancement and development, including
adapting the System for new betting propositions, (iv) obtaining
approval to run the System in the State of Nevada using a central
hub to which the Company's Player Betting Stations at multiple
sports wagering establishments will be connected, (v) obtaining
all required Nevada gaming licenses, including that needed to
provide the System to sports wagering establishments in exchange
for a portion of the revenue received by the establishment or on
the basis of a transaction fee, (vi) securing further
intellectual property protection, including additional patent,
trademark and copyright protections, and (vii) exploring
opportunities in foreign markets and alternative applications of
the Company's proprietary technology, including adaptation of the
System for use in non-wagering activities.  The Company expects
to purchase from others all of the hardware used in the System
and believes that all of such hardware is available from numerous
sources.  It does not expect to purchase such hardware until it
has entered into contracts with sports wagering establishments.

     For the three month and six month periods ended March
31,1997, the Company had net losses of $350,864 and $991,946,
respectively.  These compare with net losses of $141,731 and
$298,659, respectively, for the three month and six month periods
ended March 31, 1996.  No revenues were reported in either
period, as the Company is in the development stage.  The
increased quarterly loss resulted primarily from increased salary
expenses attributable to greater research and development and
administrative activity, as well as increased marketing expenses,
professional fees, and insurance expenses.  The increased loss
for the six month period also reflects the interest expense and
debt discount ascribed to warrants issued as part of the bridge
financing consummated on October 28, 1996, and expenditures
associated with the trial of the System at Excalibur.  The
Company incurred approximately $232,832 and $412,105,
respectively, in research and development expenses for the three
month and six month periods ended March 31, 1997, compared with
approximately $129,645 and $273,211, respectively, for the three
month and six month periods ended March 31, 1996.  The increases
are attributed largely to salary expenses and expenditures
associated with the trial of the System at Excalibur.

     The Company expects to continue to incur substantial
research and development expenses for further product enhancement
and development activities, including adapting the System for use
in sporting events in addition to football, basketball and
baseball; developing new betting propositions; adapting the
System for use in foreign countries; and exploring alternative
applications of the Company's proprietary technology, including
adaptation of the System for use in non-wagering activities.

     Based upon its current proposed plans and assumptions
relating to its operations, the Company anticipates that existing
resources will be sufficient to satisfy its contemplated cash
requirements for the next 18 to 24 months.

     Except for the historical information contained herein, this
quarterly report on Form 10-QSB may contain forward-looking
statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended.  Such forward-looking
statements include, but are not limited to, the length of time
that the Company's cash resources will last.  Investors are
cautioned that forward-looking statements are inherently
uncertain.  Actual performance and results of operations may
differ materially from those projected or suggested in the
forward-looking statements due to certain risks and
uncertainties, including, without limitation, inability of the
Company to obtain required licenses from the Nevada gaming
authorities, and failure of the Company's SportXctionTM sports
wagering system to be accepted by casinos, sports book operators
and players.  Additional information concerning certain risks and
uncertainties that would cause actual results to differ
materially from those projected or suggested in the forward-
looking statements is contained in the Company's filings with the
Securities and Exchange Commission, including those risks and
uncertainties discussed in the Company's final Prospectus, dated
December 11, 1996, included as part of the Company's Registration
Statement on Form SB-2 (333-15005), in the section entitled "Risk
Factors".  The forward-looking statements contained herein
represent the Company's judgment as of the date of this report,
and the Company cautions readers not to place undue reliance on
such matters.













































Part II:     Other Information

Item 5. Other Events

     Effective 9:30 a.m. on April 7, 1997 (the "Separation Date")
the 1,725,000 shares of Common Stock and Warrants comprising the
Units that were issued in the Company's initial public offering
were detached and became separately transferable. The Units are
no longer traded or quoted on the Nasdaq Small Cap Market.  The
Common Stock and Warrants are traded and quoted under the symbols
ISWI and ISWIW, respectively.

     Each Warrant entitles the holder to purchase, at any time on
or after April 7, 1997 and until 5:00 p.m. New York City time, on
December 11, 2001, one share of Common Stock at an exercise price
of $7.20, subject to certain adjustments.  The Company may, at
its option, redeem the Warrants at any time on or after April 7,
1997, in whole but not in part, upon not less than 15 days'
notice, at a price of $.05 per Warrant, provided that the current
market price of the Common Stock has been at least $12.00 for 15
consecutive trading days ending within 15 days of the date of
notice of redemption.  The foregoing description of the terms of
the Warrants is subject to the more detailed information and
other provisions of the Warrant Agreement by and between the
Company and American Stock Trust and Transfer Company filed as
Exhibit 4.5 to the Company's Registration Statement in Form SB-2
No. 333-15005. 

























Item 6.   Exhibits and Reports on Form 8-K

          (a)  Exhibits

               10.1  Employment Agreement dated as of February 3,
                     1977 between the Company and Sidney Diamond.

               27 -  Financial Data Schedule

          b)   Reports on Form 8-K

               No reports on Form 8-K were filed by the Company  
               during the quarter ended March 31, 1997.










































                                SIGNATURES


     In accordance with the requirements of the Securities
Exchange Act of 1934, the registrant caused this report to be
signed on its behalf by the undersigned thereunto duly
authorized.



                              International Sports Wagering Inc.

Dated:    May 14, 1997   By:  S. BARRY MINDES
                              Barry Mindes, Chairman of the
                              Board of Directors
                              (Principal Executive Officer)

Dated:    May 14, 1997        S/BERNARD ALBANESE
                              Bernard Albanese, President
                              Treasurer and Director

Dated:    May 14, 1997        S/JENEENE NORMAN
                              Jeneene Norman, Chief
                              Financial and Accounting Officer