WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.

  


<ARTICLE>                     5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE 
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS UNAUDITED AND NOTES TO THE 
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE MONTH PERIOD ENDED
MARCH 31, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FORM 10-K
FOR THE YEAR ENDED DECEMBER 31, 1996, AS AMENDED, FILED ON APRIL 15, 1997.
</LEGEND>
<CIK>                            0000722051
<NAME>                           NOISE CANCELLATION TECHNOLOGIES, INC. 
<MULTIPLIER>                     1000 
<CURRENCY>                       U.S. DOLLARS           
       
                              
<PERIOD-TYPE>                    YEAR
<FISCAL-YEAR-END>                DEC-31-1997
<PERIOD-START>                   JAN-01-1997
<PERIOD-END>                     DEC-31-1997
<EXCHANGE-RATE>                     0
<CASH>                           1171
<SECURITIES>                        0
<RECEIVABLES>                    3518
<ALLOWANCES>                       63
<INVENTORY>                      1227
<CURRENT-ASSETS>                 5927
<PP&E>                           5304
<DEPRECIATION>                   3435
<TOTAL-ASSETS>                   9589
<CURRENT-LIABILITIES>            3186
<BONDS>                             0
<PREFERRED-MANDATORY>               0
<PREFERRED>                         0
<COMMON>                         1129
<OTHER-SE>                       2199
<TOTAL-LIABILITY-AND-EQUITY>     9589
<SALES>                           234
<TOTAL-REVENUES>                 3315
<CGS>                             199
<TOTAL-COSTS>                     290
<OTHER-EXPENSES>                 2426
<LOSS-PROVISION>                 (209)
<INTEREST-EXPENSE>                  0
<INCOME-PRETAX>                   599
<INCOME-TAX>                        0
<INCOME-CONTINUING>               599
<DISCONTINUED>                      0
<EXTRAORDINARY>                     0
<CHANGES>                           0
<NET-INCOME>                      599
<EPS-PRIMARY>                     .01
<EPS-DILUTED>                     .01