[DOCUMENT-COUNT]     02
[SROS]     NASD
[PERIOD]     12/31/95
                      SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC   20549
                                  FORM 10-Q

  X  	Quarterly report pursuant to Section 13 or 15 (d) of 
the Securities Exchange Act of 1934

	For the quarterly period ended December 31, 1995 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	0-18603


             				INTEGRAL SYSTEMS, INC.
(Exact name of registrant as specified in its chapter)

		Maryland                        						52-1267968		
(State or other jurisdiction of	    	I.R.S. Employer
incorporation or organization)     		Identification No.)

	5000 Philadelphia Way, Suite A, Lanham, MD	20706		
(Address of principal executive offices)		Zip Code)

Registrants telephone number, including area (301) 731-4233	

(Former name, address and 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        	   

	As of December 31, 1995 the aggregate market value of the 
Common Stock of the Registrant (based upon the average bid and 
ask prices of the Common Stock as reported by the market makers) 
held by non-affiliates of the Registrant was $19,325,513.

	Registrant has 946,846 shares of common stock outstanding as 
of December 31, 1995.


                         INTEGRAL SYSTEMS, INC.
                           TABLE OF CONTENTS


Part I   Financial Information:
	
	Page No.

Item 1.  Financial Statements

Consolidated Balance Sheets as of
 December 31, 1995, September 30, 1995                        	1

Consolidated Statements of Operations for the Three Months 
   Ended December 31, 1995 and December 31, 1994               3

Consolidated Statement of Cash Flows for the
 Three Months Ended December 31, 1995 and December 31, 1994   	4

Consolidated Statement of Shareholders Equity for the
 Three Months Ended December 31, 1995                         	5

Notes to Financial Statements                                 	6

Item 2.  Managements Discussion and Analysis of Financial 
		Condition and Results of Operation                          	7


Part II   Other Information:

Item 6.  Exhibits and Reports on Form 8-K                     	9


Item 1.    Financial Statements

[CAPTION]
                        INTEGRAL SYSTEMS, INC.
                      CONSOLIDATED BALANCE SHEETS
                 DECEMBER 31, 1995 & SEPTEMBER 30, 1995



ASSETS	 							

                                                       
                            		           	December 31,	      September 30,
                                          				1995           				1995
CURRENT ASSETS						 		
	Cash					                                $1,450,703 	       $2,125,553 
	Accounts Receivable	                      3,993,417        		3,483,777 
	Prepaid Expenses			                          49,787           		71,537 
	Deferred Income Taxes	                      	60,719           		60,719 

TOTAL CURRENT ASSETS                   				5,554,626        		5,741,586 
								
FIXED ASSETS						 		
								
	Electronic Equipment                       	585,137          		624,708 
	Furniture & Fixtures                       		34,243           		41,716 
	Leasehold Improvements                      	11,364           		11,364 
 	Software Purchases                         	27,592           		37,085 
SUBTOTAL					                               	658,336          		714,873 
								
	Less:  Accum. Deprec.		                     290,263 	         	426,249 
								
TOTAL FIXED ASSETS                       				368,073          		288,624 
						 		
OTHER ASSETS						 		
  Software Development Costs              	1,347,743        		1,373,219 
 	Deposits				                                  	150              		150 
TOTAL OTHER ASSETS			                     	1,347,893        		1,373,369 
								
TOTAL ASSETS			                         		$7,270,592        	$7,403,579 



[CAPTION]
                          INTEGRAL SYSTEMS, INC.
                       CONSOLIDATED BALANCE SHEETS
                  DECEMBER 31, 1995 & SEPTEMBER 30, 1995
								
								

                                                               								
LIABILITIES & STOCKHOLDERS' EQUITY						
		
		                                   			December 31,	      September 30,
                                      		 			1995             		1995
				 				
CURRENT LIABILITIES				 				
	Accounts Payable		                      366,379 		        $  351,995 
	Accrued Expenses		                      621,745          		  875,248 
	Billings in Excess of Cost	             625,611 		           561,202 
	Income Taxes Payable		                   39,000          		  108,481 
								
TOTAL CURRENT LIABILITIES	             1,652,735        		  1,896,926 
						 		
LONG TERM LIABILITIES						 		             -----               ------
						 		
STOCKHOLDERS' EQUITY						 		
 	Common Stock, $.01 par value,
	2,000,000 shares authorized, and
	946,846 and 943,746 shares issued
 and outstanding at December 31, 1995
	and September 30, 1995, respectively		    9,468 		            9,437 
	Addl Paid in Capital			                 745,681	            696,437 
	Retained Earnings			                  4,862,708         		4,800,779 

TOTAL STOCKHOLDERS' EQUITY	           	5,617,857 		        5,506,653 
						 		
TOTAL LIABILITIES &
STOCKHOLDERS EQUITY                  $7,270,592 	         7,403,579 


[CAPTION]
                          INTEGRAL SYSTEMS, INC.
                  CONSOLIDATED STATEMENTS OF OPERATIONS
						

						
                                        		 			  Three Months Ended
                                             			   	December 31
                                    						1995	 	           	1994
                                                        			 		
Contract Revenue				                      $2,435,015	        $3,327,681 
				 		
Cost of Revenue				 		
	Direct Labor			                             855,165 		         871,803 
	Overhead			                                 683,944         			610,346 
	Travel & Other Direct Costs		               262,046          		186,112 
	Equipment & Subcontractors		                276,617        		1,198,573 
Total Cost of Revenue		                    2,077,772 		       2,866,834 
				 		
Gross Profit                             				357,243 			        460,847 
				 		
Operating Expenses				 		
	General & Administrative	                   233,501 			        306,082 
Total Operating Expenses			                  233,501          		306,082 
				 		 
Income From Operations	                    		123,742          		154,765 
						
Other Income (Expense)				 		
	Interest Income			                           20,454           		12,163 
	Interest Expense			                               8 				            (1)
	Other Income (Expense)		                    (43,275)          		(4,781)
Total Other Income (Expense)		              	(22,813)           		7,381 
				 		
Income Before Income Taxes			                100,929 		         162,146 
				 		
Income Taxes                                		39,000 		          59,700 
				 		
Net Income                               				$61,929         		$102,446 
				 		 
Weighted Average Number of Common						
Shares Outstanding During Period		           944,913          		939,937
						
Earnings per share                         				$0.07            		$0.11 


[CAPTION]
                           INTEGRAL SYSTEMS, INC.
                  CONSOLIDATED STATEMENTS OF CASH FLOWS
								
		                                       			For the Three Months Ended
                                              						December 31,
					                                      	1995		                1994

                                                        
Cash Flows from Operating Actiivties:					
			
								
Net Income					                             $61,929           $102,446 
								
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization	              166,949 		         166,823 
	(Increase) decrease in:
	Accounts Receivable	                     	(509,640)	      	(1,378,474)
	Prepaid Expenses	                          	21,750           		(4,082)
	Deferred Income Taxes		                          0           		52,623 
	(Decrease) increase in:
	Accounts Payable		                          14,384          		455,202 
	Accrued Expenses                         	(253,503)        		(477,937)
	Billings in Excess of Cost                 	64,409          		(82,429)
	Income Taxes Payable                     		(69,481)	           	7,077 
Total Adjustments		                       	(565,132)	      	(1,261,197)
								
Net Cash provided (used) by operations     (503,203)	       (1,158,751)
								
Cash Flow from investing activities:					
			
	Acquisition of fixed assets	              (119,258)		         (54,018)
	Increase in software development          (101,664)	          (90,623)
	Sale of Marketable Securities	                   0 		         403,100 
								
Net cash provided (used)
 in investing activities		                 (220,922)		         258,459 
								
Cash flow from financing activities:					
			
Proceeds from issuance of common stock	      49,275 		          40,462 
								
Net cash provided by
 financing activities			                     49,275 		          40,462 
								
Net increase (decrease) in cash	           (674,850)		        (859,830)
								
Cash - beginning of year		                2,125,553 		       1,802,840 
								
Cash - end of period			                  $1,450,703          	$943,010 

								
								

[CAPTION]
										
                       INTEGRAL SYSTEMS, INC
           CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                    FOR THE THREE MONTHS ENDED
                         DECEMBER 31, 1995

										
                                                   										
		                         Number				     Additional				
		                           of	  	Common	 	Paid-in	  	Retained		
                         		Shares	 	Stock 		Capital		  Earnings			   Total
										
Balance September 30, 1995	943,746 	$9,437 	$696,437 	$4,800,779 	$5,506,653 

Exercise of Stock Options		  3,100 		   31 	  49,244 	     --		       49,275 
										
Net income	                     	-		     -		       -		    61,929    		61,929 
										
Balance December 31, 1995		946,846 		$9,468	$745,681 		$4,862,708 $5,617,857 




                             INTEGRAL SYSTEMS, INC.
                         NOTES TO FINANCIAL STATEMENTS


1.	Basis of Presentation

The interim financial statements include the accounts of 
Integral Systems, Inc. (ISI) and its two wholly-owned 
subsidiaries, Integral Marketing, Inc. (IMI) and InterSys, 
Inc. (INTSYS).  In the opinion of management, the financial 
statements reflect all adjustments consisting only of normal 
recurring accruals necessary for a fair presentation of 
results for such periods.  The financial statements, which 
are condensed and do not include all disclosures included in 
the annual financial statements, should be read in 
conjunction with the consolidated financial statements of 
the Company for the fiscal year ended September 30, 1995.  
The results of operations for any interim period are not 
necessarily indicative of results for the full year.

2.	Accounts Receivable

Accounts receivable at December 31, 1995 and September 30, 
1995 consist of the following:

                         	Dec. 31,	         Sept. 30,
                         	1995 	            1995

              	Billed	   $1,783,948	        $1,653,777
            	Unbilled	    2,209,469 	        1,830,000

                       		$3,993,417	        $3,483,777

	The Company uses the direct write-off method for bad debts.

The Company's accounts receivable consist of amounts due on 
prime contracts and subcontracts with the U.S. Government 
and contracts with various private organizations.  Unbilled 
accounts receivable consist principally of amounts that are 
billed in the month following the incurrence of cost.  All 
unbilled receivables are expected to be billed and collected 
within one year.

3.	Line-of-Credit

The Company has a line of credit agreement with a local bank 
for $1,200,000.  Borrowing under the line of credit bears 
interest at the bank's lending rate plus one-quarter of one 
percentage point per annum. Any accrued interest is payable 
monthly.  At December 31, 1995 and September 30, 1995 the 
Company had no outstanding balance under the line of credit.


               MANAGEMENT'S DISCUSSION AND ANALYSIS
       OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS



COMPARISON OF THE QUARTER ENDED DECEMBER 31, 1995 
TO THE QUARTER ENDED DECEMBER 31, 1994
 
	The components of the Company's income statement as a 
percentage of revenue are depicted in the following table for the 
quarters ended December 31, 1995 and December 31, 1994:
[CAPTION]

                                      % of                     % of
                           1995      Revenue     1994          Revenue
                    (000's ommitted)         (000's ommitted) 

                                                   
Revenue                    $2,435     100.0    $3,328          100.0

Expenses               
  Cost of Revenue           2,078      85.3     2,867           86.1
  General & Admin.            233       9.6       306            9.2
  Other                        23       1.0        -7            -.2
  Income Taxes                 39       1.6        60            1.8

Total Expenses              2,373      97.5     3,226           96.9

Net Income                    $62       2.5      $131            3.1


	Revenue

	Revenue decreased by approximately $900,000 between the 
quarter ended December 31, 1995 and the quarter ended December 
31, 1994.  The decrease is attributable to the delivery of 
$900,000 less equipment during the current quarter than what was 
delivered in the first quarter last fiscal year.

	During the current period, the Company derived approximately 
45% of its revenues from the sale of its commercial products and 
related services which is a comparable percentage to what the 
Company realized during the first quarter in the prior fiscal 
year.  The percentage for both periods is significant, and 
correlates to the Companys conscious effort to reduce its 
reliance on the Federal Government, and to utilize its recently 
developed software products to gain access to organizations in 
order to sell both its products and associated integration and 
support services.

	Although the Company believes that its full cadre of 
software products is important for its future growth and 
prosperity, to date the Company's largest product investment 
relates to the development of its EPOCH software, an off-the-
shelf product for satellite command and control.  During the 
first quarter of fiscal year 1996, the Company recorded 
approximately $770,000 of revenue for services associated with 
its EPOCH product compared to $1,220,000 of revenue during the 
first quarter of fiscal year 1995.  The decrease relates to the 
delivery of only $50,000 of equipment in the current period 
compared to $700,000 of equipment delivered in the first quarter 
last fiscal year.  Fiscal year 1996 EPOCH revenues included 
approximately $135,000 of license fees, while no license fee 
revenues were recorded during the first quarter of fiscal year 
1995.	

	The principal balance of the Company's commercial revenues 
pertain to other proprietary products as follows: OASYS (Orbital 
Analysis System); DRS (DOMSAT Receive Station); and a collection 
of software pertaining to database and information system 
applications.  During the first quarter of fiscal year 1996, the 
Company recorded approximately $90,000 of revenue related to the 
sale of products and services under these programs compared to 
approximately $235,000 of revenue recorded during the first 
quarter last fiscal year.

	The decrease principally relates to DRS shipments scheduled 
for delivery in the first quarter this fiscal year that have been 
delayed to the second quarter, and a deliberate recent phase down 
of the Companys database and information systems marketing and 
promotion efforts.

	The Companys subsidiary, Integral Marketing, Inc., (IMI) 
accounted for an additional $100,000 of commercial revenue during 
the current period.  IMI contributed approximately $55,000 of 
revenue to the Companys consolidated revenue total last fiscal 
year during the first quarter.

	Expenses

	Cost of revenue as a percentage of revenue for the first 
quarter of fiscal year 1996 was 85.3% compared to 86.1% for the 
first quarter in fiscal year 1995.  The Company believes that 
there are no material differences between the two percentages and 
that these figures are typical and representative of the 
Companys current operating cost structure.

	G&A expense decreased approximately $70,000 between the 
periods being compared, principally because the Company incurred 
less international marketing expenses during the first quarter 
this fiscal year compared to the first quarter last fiscal year.  
The Company believes that for fiscal year 1996, overall, that G&A 
expenses will be at least as great as the expenses incurred 
during fiscal year 1995.

	Other expenses were $23,000 during the current period 
compared to $7,000 of other income recorded during the first 
quarter last fiscal year.  This reversal is principally due to 
expenses incurred by the Company that were previously classified 
as reimbursable overhead costs that are currently considered 
unallowable by the Defense Contract Audit Agency (DCAA) under 
cost reimbursable type contracts with the Federal Government.

	Income taxes as a percentage of revenue were comparable 
during the first quarters of fiscal years 1996 and 1995.

		General

	Overall, net income as a percentage of revenue was 2.5% in 
the first quarter of fiscal year 1996 compared to 3.1% in the 
first quarter of fiscal year 1995.  Essentially fiscal year 1996 
income to date was lower than income generated through the first 
quarter of fiscal year 1995 due to lower revenue totals and in 
particular lower equipment deliveries to both commercial and 
Government customers.  Notwithstanding, the Company believes that 
based on contracts in hand and contracts to be imminently 
awarded, that  both revenue and income totals for the entire 
fiscal year 1996 period will exceed amounts recorded for fiscal 
year 1995.


	
Liquidity and Capital Resources

	With the exception of the Companys second quarter of fiscal 
year 1994, the Company has been profitable since inception and 
has been able to generate adequate cash flow from operations to 
fund its operating and capital expenses.  To supplement operating 
cash flows, the Company has access to a line of credit facility 
in the amount of $1.2 million which is currently unused. (See 
Note 3 of the Notes to Financial Statements).  During the first 
quarter of fiscal year 1996, the Company used approximately 
$500,000 from operating activities and used approximately 
$220,000 for investing activities, including approximately 
$100,000 for software development.

	Although operating activities consumed significant sums of 
cash during the first quarter of fiscal year 1996 due to the 
financing required to fund certain of the Companys fixed price 
milestone based contracts, the Company believes that collections 
under these same contracts later in the fiscal year will put the 
Company in a position of generating cash flow from operations on 
a year to date basis.

	In terms of software development, the Company has incurred 
and capitalized approximately $1,410,000 of costs (inception to 
date) relating to its EPOCH product.  During July, 1994, the 
Company delivered its first EPOCH licenses to customers 
previously booked. Consequently the Company commenced 
amortization of the capitalized costs under this program during 
the fourth quarter of fiscal 1994.

	As of December 31, 1995, the Companys balance sheet 
included approximately $960,000 of unamortized software 
development costs related to the EPOCH product.  Most of the 
Companys remaining software development costs pertain to the 
Companys OASYS product, which can be sold as a standalone 
product or in conjunction with EPOCH.


	In July, 1988 the Company raised approximately $400,000 
(net) through the sale of 110,000 common shares in its initial 
public offering.

	As a result of its current cash reserves, its unused line of 
credit, its current profitability and its projected profitability 
for the balance of fiscal year 1996, the Company believes it will 
have adequate cash resources to meet its obligations for the 
foreseeable future.

	In terms of capital purchases, historically the Company has 
funded such items through operating cash flow or capital lease.  
The Company currently has no plans for major capital purchases in 
the ensuing twelve month period, although the Company plans to 
continue to invest (albeit at lower levels) in the continued 
development and improvement of its software products, especially 
EPOCH and OASYS.


Part II. Other Information

6.	Exhibits and Reports on Form 8-K

	a.    Exhibits
		None



	

                               SIGNATURES




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



                            								INTEGRAL SYSTEMS, INC.
                             								    (Registrant)






Date:  2/15/96                     			 	By:  Thomas L. Gough
		
                                								Thomas L. Gough
                                								President