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 June 30, 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 July
25, 1997.


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









                    International Sports Wagering Inc.
                               June 30, 1997
                                Form 10-QSB

                                   Index

                                                               Page 
                                                            
Part I:   Financial Information

Item 1.   Financial Statements

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

          Statements of Operations for the Nine and Three 
          Months Ended June 30, 1997 and June 30, 1996 and       
          May 22, 1995 (date of inception) to June 30, 1997.
          (Unaudited).                                           3

          Statement of Changes in Stockholders' Equity for 
          the Nine Months Ended June 30, 1997 (Unaudited).       4

          Statements of Cash Flows for the Nine Months Ended     
          June 30, 1997 and 1996 and May 22, 1995 (date of
          inception) to June 30, 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 6.   Exhibits and Reports on Form 8-K.                     11 

Signatures                                                      12  










                                 1                     
                                     
               




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

                                  Assets

                                       June 30,     September 30,
                                        1997             1996   
                                     (Unaudited)       (Note 1)  

Current Assets:
  Cash and cash equivalents         $ 2,184,495        $ 537,546 
  Short-term investments              5,076,643             --
  Prepaid expenses and other
    current assets                      232,891            8,885 

      Total Current Assets            7,494,029          546,431 

Property and Equipment, net             407,662          304,466 

Other Assets                             50,273            4,258 

Deferred Financing Costs                  --              46,406 

      Total Assets                  $ 7,951,964        $ 901,561 
 
                   Liabilities and Stockholders' Equity

Current Liabilities:
  Accounts payable                  $    11,500        $  42,382 
  Accrued expenses                       60,735          143,265 

    Total Current Liabilities            72,235          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         10,214,829        1,687,089 
  Deficit accumulated during the
    development stage                (2,342,849)        (977,199)

      Total Stockholders' Equity      7,879,729          715,914

      Total Liabilities and
        Stockholders' Equity        $ 7,951,964       $  901,561 

See Notes to Financial Statements

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



                                                                  May 22, 1995
                                                                    (Date of   
                       Nine Months Ended    Three Months Ended     Inception)
                            June 30,             June 30,          to June 30 
                        1997       1996       1997       1996        1997      

Costs and Expense:
 Research and 
  development 
  expense          $   611,793  $ 449,470  $ 199,688  $ 176,259   $ 1,403,088 
 General and
  administrative
  expense              668,496     88,189    265,525     51,152       894,403

   Operating Loss   (1,280,289)  (537,659)  (465,213)  (227,411)   (2,297,491)  
 
Interest expense      (299,098)     --          --         --        (299,098)  

Interest income        213,737     21,007     91,509      9,418       253,740

   Net Loss        $(1,365,650) $(516,652) $(373,704) $(217,993)  $(2,342,849) 

Net Loss per share $      (.18) $    (.08) $    (.05) $    (.03)  $      (.34)

Weighted average
 common shares
 outstanding         7,383,877  6,477,410  7,749,269  6,477,410     6,798,794 














See Notes to Financial Statements




                       International Sports Wagering Inc.
                         (A Development Stage Company)
                  Statement of Changes In Stockholders' Equity
                    For the Nine Months Ended June 30, 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                                            (1,365,650) (1,365,650)

Issuance of
 Common Stock      1,725,000   1,725    8,527,740        --      8,529,465

Balance at
 June 30, 1997     7,749,269 $ 7,749  $10,214,829  $(2,342,849) $7,879,729




























See Notes to Financial Statements

                       International Sports Wagering Inc.
                         (A Development Stage Company)
                            Statements of Cash Flows
                                                        May 22, 1995  
                               Nine Months Ended           (Date of Inception)
                                    June 30,              to June 30, 
                               1997         1996              1997       
Cash Flows from
 Operating Activities:
  Net Loss                 $(1,365,650)   $ (516,652)     $(2,342,849)
  Adjustment to 
   reconcile net loss
   to net cash (Used in)
   operating activities:
    Depreciation and
     amortization               99,589        33,500          171,492
    Issuance of options
     to consultants              --             --             14,500
    Changes in assets
     and liabilities:
      Prepaid expenses
       and other current
       assets                 (224,006)        5,222         (232,891)   
      Other assets             (46,604)         --            (51,909)   
      Accounts payable         (30,882)        3,545           11,500    
      Accrued expenses         (82,530)        8,173           60,735
  Net Cash (Used In)
   Operating Activities     (1,650,083)     (466,212)      (2,369,422) 

Cash Flows from Investing
 Activities:
  Short-term investments    (5,076,643)         --         (5,076,643)  
  Purchase of property
   and equipment              (202,196)     (184,819)        (577,518) 
    Net Cash (Used In)
     Investing Activities   (5,278,839)     (184,819)      (5,654,161)
Cash Flows from
 Financing Activities:
  Net Proceeds from 
   issuance of common 
   stock                     8,575,871       819,618       10,208,078 

Net Increase in Cash 
 and Cash Equivalents        1,646,949       168,587        2,184,495
  
Cash and Cash Equivalents,
 Beginning of Period           537,546       694,810             --  

Cash and Cash Equivalents,
 End of Period             $ 2,184,495    $  863,397      $ 2,184,495
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 is 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         1,271,859

        Weighted average common shares and
        equivalents outstanding                      7,749,269  




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. 

   On April 7, 1997, the 1,725,000 shares of Common Stock and
Warrants comprising the Units that were issued in the Company's
initial public offering and subsequent over-allotment exercise
were detached and became separately transferable.  The Common
Stock and Warrants are traded on the Nasdaq Small Cap Market, and
quoted under the symbols ISWI and ISWIW, respectively.

     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.

   On July 6, 1997, the Company completed another live trial of
the System, this time using a central hub for wide area operation
linking multiple sites in Nevada, as one of the conditions for
obtaining approval by Nevada gaming authorities for use of the
System in wide area operation. The Board is currently reviewing
the results of this trial.  Licensing for wide area operation is
being applied for simultaneously.  Wide area operation of the
System would permit simultaneous wagering during the course of
sporting events at multiple inter-linked casinos or other gaming
establishments in Nevada.  A central hub would link, via
telecommunications lines, the Company's Player Betting Stations
located in individual gaming establishments, resulting in larger
combined pools, reduced operating costs and improved efficiency
for participating gaming establishments.

   On June 23, 1997, the Company announced that it had signed a
contract with Yarlow, Inc. ("Yarlow") pursuant to which Yarlow
would act as a hub operator for the Company's SportXctionTM
sports wagering system.  Yarlow currently operates sportsbooks
across the State of Nevada.  The Company intends to implement a
central hub in Las Vegas, Nevada, which will be operated by
Yarlow for at least one year, or until such time as the Company
receives a gaming license and any other approvals necessary to
permit it to operate the hub.  Prior to operation of a central
hub, the hub operator will 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.

   The Company has also announced that it has signed its first
seven contracts with sports wagering establishments in Nevada,
pursuant to which the Company's Player Betting Stations would be
installed in such establishments and connected to the central
hub.  The Company is continuing to negotiate with other casinos. 
It is the Company's goal to commence live wide area operations in
September 1997.

   The Company has filed an application with the Board to
obtain a gaming license.  The process to obtain such license is
expected to take nine to twelve months from the time all required
information has been submitted.  The Board may require the
Company to obtain additional approvals in order for it to be
permitted to act as a hub operator.  When and if the Company is
issued a gaming license, it intends to assume control and
operation of the hub; according to the terms of the contract with
Yarlow, this will not take place prior to June 18, 1998. There
can be no assurance that the Board will issue the approvals
necessary for operation of a central hub, either by the Company
or a third party, or that the Company will be issued a gaming
license. 

   In June 1997, the Company opened a sales, support and
operations office in Las Vegas, Nevada, to facilitate its
business in Nevada.

     The Company's plan of operation during the next 12 months
focuses primarily on (i) 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, (ii) continued sales and
marketing to casinos and other sportsbook operators in Nevada,
(iii) the hiring of additional personnel in the areas of sales
and marketing, equipment installation, maintenance and training,
(iv) continued research and further product enhancement and
development, including adapting the System for new betting
propositions, (v) obtaining all required Nevada gaming licenses,
including those 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. 

     For the three month and nine month periods ended June
30,1997, the Company had net losses of $373,704 and $1,365,650
respectively.  These compare with net losses of $217,993 and
$516,652, respectively, for the three month and nine month
periods ended June 30, 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 Company incurred
additional expenses in connection with the set-up and operation
of its Las Vegas office and the trial of the System in Nevada for
wide area operation. The Company also began, during the quarter,
to purchase computer equipment needed to fulfill its contracts to
install Player Betting Stations in gaming establishments.  The
increased loss for the nine 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 first trial of the System at
Excalibur.  The Company incurred approximately $199,688 and
$611,793, respectively, in research and development expenses for
the three month and nine month periods ended June 30, 1997,
compared with approximately $176,259 and $499,470, respectively,
for the three month and nine month periods ended June 30, 1996. 
The increases are largely attributable to salary expenses and
expenditures associated with the two trials of the System in
Nevada.

     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 and when the System
will commence live wide area operation.  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 to obtain required licenses from the Nevada
gaming authorities, and failure of the Company's SportXctionTM
sports wagering system to be accepted by casinos, sportsbook
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.





















II:  Other Information





Item 6.   Exhibits and Reports on Form 8-K

          (a)  Exhibits

               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 June 30, 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:    August 13, 1997 By:  S/ BARRY MINDES
                               Barry Mindes, Chairman of the
                               Board of Directors
                               (Principal Executive Officer)

Dated:    August 13, 1997      S/BERNARD ALBANESE
                               Bernard Albanese, President
                               Treasurer and Director

Dated:    August 13, 1997      S/JENEENE NORMAN
                               Jeneene Norman, Chief
                               Financial and Accounting Officer























                              

                               12