SECURITIES AND EXCHANGE COMMISSION

                            Washington, D.C. 20549

                                   FORM 10-Q

                 QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF

                      THE SECURITIES EXCHANGE ACT OF 1934

(Mark one)
[X]   QUARTERLY  REPORT  PURSUANT TO  SECTION 13  OR  15(d) OF  THE SECURITIES
      EXCHANGE  ACT OF 1934
 
For the quarterly period ended   June 30, 1994                      

                                      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             0-4117-1                     

                               IES UTILITIES INC.                       
            (Exact name of registrant as specified in its charter)

            Iowa                            42-0331370                  
(State or other jurisdiction of           (I.R.S. Employer
 incorporation or organization)            Identification No.)

  IE Tower, Cedar Rapids, Iowa                      52401               
(Address of principal executive offices)         (Zip Code)

Registrant's telephone number, including area code    (319) 398-4411    


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    

Indicate the number of shares  outstanding of each of the issuer's  classes of
common stock, as of the latest practicable date.


            Class                   Outstanding at July 31, 1994        
Common Stock, $2.50 par value              13,370,788 shares 





                              IES UTILITIES INC.

                                     INDEX


                                                                      Page No.


Part I.  Financial Information.



Item 1.    Financial Statements.

      Balance Sheets -
        June 30, 1994 and December 31, 1993                             3 - 4

      Statements of Income -
        Three, Six and Twelve Months Ended
        June 30, 1994 and 1993                                            5   

      Statements of Cash Flows -
        Three, Six and Twelve Months Ended
        June 30, 1994 and 1993                                            6   

      Notes to Financial Statements                                     7 - 16

Item 2.   Management's Discussion and Analysis of the
           Results of Operations and Financial Condition.              17 - 27


Part II.  Other Information.                                           28 - 30


Signatures.                                                              31   




                                       PART 1. - FINANCIAL INFORMATION
ITEM 1. - FINANCIAL STATEMENTS
                                                 BALANCE SHEETS


                                                            June 30,
                                                              1994           December 31,
ASSETS                                                    (Unaudited)            1993
                                                                    (in thousands)
                                                                     
Utility plant, at original cost:
    Plant in service -
      Electric                                          $   1,732,430      $   1,707,278
      Gas                                                     152,933            147,956
      Other                                                    76,889             75,845
                                                            1,962,252          1,931,079
    Less - Accumulated depreciation                           850,897            813,312
                                                            1,111,355          1,117,767
    Leased nuclear fuel, net of amortization                   43,600             51,681
    Construction work in progress                              57,110             41,937
                                                            1,212,065          1,211,385

Current assets:
  Cash and temporary cash investments                             691             18,313
  Accounts receivable -
    Customer, less reserve                                     11,992             22,679
    Other                                                       8,503             10,330
  Income tax refunds receivable                                11,963              8,767
  Production fuel, at average cost                             11,583             14,338
  Materials and supplies, at average cost                      26,479             26,861
  Regulatory assets                                            15,194             13,319
  Prepayments and other                                        21,559             31,502
                                                              107,964            146,109

Other assets:
  Regulatory assets                                           169,046            143,080
  Nuclear decommissioning trust funds                          31,373             28,059
  Other investments                                             3,624              2,821
  Deferred charges and other                                   15,418             15,524
                                                              219,461            189,484
                                                        $   1,539,490      $   1,546,978




                                          BALANCE SHEETS (CONTINUED)


                                                            June 30,
                                                              1994           December 31,
CAPITALIZATION AND LIABILITIES                            (Unaudited)            1993
                                                                      (in thousands)
                                                                     

Capitalization:
  Common stock - par value $2.50 per share - authorized
    24,000,000 shares; 13,370,788 shares outstanding    $      33,427      $      33,427
  Paid-in surplus                                             279,042            279,042
  Retained earnings ($18,209,000 restricted as to
    payment of cash dividends)                                190,603            188,862
      Total common equity                                     503,072            501,331
  Cumulative preferred stock - par value $50 per
      share - authorized 466,406 shares; 366,406 shares 
      outstanding                                              18,320             18,320
  Long-term debt                                              430,225            480,074
                                                              951,617            999,725

Current liabilities:
  Notes payable to associated companies                        14,266
  Short-term borrowings                                         3,000             24,000
  Capital lease obligations                                    13,508             15,345
  Sinking funds and maturities                                 50,224                224
  Accounts payable                                             36,653             47,179
  Dividends payable                                               229              5,229
  Accrued interest                                              9,464              9,438
  Accrued taxes                                                43,422             39,763
  Accumulated refueling outage provision                        8,711              2,660
  Adjustment clause balances                                    3,076              5,149
  Provision for rate refund liability                              31              8,670
  Other                                                        20,964             22,369
                                                              203,548            180,026

Long-term liabilities:
  Capital lease obligations                                    30,092             36,336
  Liability under National Energy Policy Act of 1992           12,065             11,984
  Environmental liabilities                                    19,519              9,130
  Other                                                        34,579             29,866
                                                               96,255             87,316

Deferred credits:
  Accumulated deferred income taxes                           246,946            237,464
  Accumulated deferred investment tax credits                  41,124             42,447
                                                              288,070            279,911

Commitments and contingencies (Note 7)

                                                        $   1,539,490      $   1,546,978

The accompanying Notes to Financial Statememts are an integral part of 
these statements.






                                              STATEMENTS OF INCOME (UNAUDITED)


                                                For the Three         For the Six           For the Twelve
                                                Months Ended          Months Ended          Months Ended
                                                    June 30               June 30               June 30
                                                1994       1993       1994       1993       1994       1993
                                                                    (in thousands)
                                                                                 
Operating revenues:
  Electric                                  $  123,071 $  122,306 $  246,989 $  248,933 $  548,578 $  485,558
  Gas                                           23,164     24,806     88,297     89,141    153,474    159,451
  Steam                                          1,784      1,807      4,746      4,630      9,026      8,621
                                               148,019    148,919    340,032    342,704    711,078    653,630

Operating expenses:
  Fuel for production                           16,304     18,727     38,649     43,268     83,082     78,271
  Purchased power                               17,225     17,171     30,827     39,280     84,997     73,195
  Gas purchased for resale                      14,882     16,555     63,998     64,784    108,336    115,113
  Other operating expenses                      30,971     31,890     61,952     59,671    125,491    119,164
  Maintenance                                   13,300     12,016     24,195     22,394     48,020     44,234
  Depreciation and amortization                 19,160     17,796     38,320     35,318     72,409     67,338
  Property taxes                                10,011      8,900     20,188     17,799     38,815     33,387
  Federal and state income taxes:
    Current                                      5,117      6,243     15,247     15,024     28,584     37,193
    Deferred                                     2,586        897      3,683      1,667     17,926     (4,117)
    Amortization of investment
      tax credits                                 (662)      (696)    (1,323)    (1,391)    (4,792)    (2,780)
  Miscellaneous taxes                            1,389      1,341      2,878      2,693      5,070      4,973
                                               130,283    130,840    298,614    300,507    607,938    565,971

Operating income                                17,736     18,079     41,418     42,197    103,140     87,659

Other income and deductions:
  Allowance for equity funds
    used during construction                       612        125      1,153        240      1,737      1,308
  Miscellaneous, net                               751      1,400      1,664      1,957      1,955      3,446
                                                 1,363      1,525      2,817      2,197      3,692      4,754

Interest:
  Long-term debt                                 9,487      8,429     18,977     17,538     36,365     35,754
  Other                                            745      1,053      1,783      2,601      4,425      4,837
  Allowance for debt funds
      used during construction                    (388)      (369)      (724)      (659)    (1,212)    (1,356)
                                                 9,844      9,113     20,036     19,480     39,578     39,235

Net income                                       9,255     10,491     24,199     24,914     67,254     53,178
Preferred and preference
  dividend requirements                            229        229        457        457        914      1,183
Net income available for
  common stock                              $    9,026 $   10,262 $   23,742 $   24,457 $   66,340 $   51,995

The accompanying Notes to Financial Statements are an integral
part of these statements.





                                          STATEMENTS OF CASH FLOWS (UNAUDITED)

                                                              For the Three         For the Six          For the Twelve
                                                              Months Ended          Months Ended          Months Ended
                                                                 June 30               June 30               June 30
                                                             1994       1993       1994       1993       1994       1993
                                                                                    (in thousands)
                                                                                                        
Cash flows from operating activities:
  Net income                                             $    9,255 $   10,491 $   24,199 $   24,914 $   67,254 $   53,178
  Adjustments to reconcile net income to
    net cash flows from operating activities -
      Depreciation and amortization                          19,160     17,796     38,320     35,318     72,409     67,338
      Principal payments under capital lease obligations      4,078      3,415      8,505      6,833     13,102     12,687
      Deferred taxes and investment tax credits               1,736       (177)     1,982       (212)    12,726     (7,062)
      Amortization of deferred charges                          276        215        544        413      1,080      1,145
      Refueling outage provision                              2,914      1,639      6,051      4,634     (3,472)    10,409
      Allowance for equity funds used during construction      (612)      (125)    (1,153)      (240)    (1,737)    (1,308)
      Other                                                     276        292        551        579      1,328        385
  Other changes in assets and liabilities -
      Accounts receivable                                     9,062     13,545     12,714      4,648       (250)    (9,248)
      Sale of utility accounts receivable                      (200)    21,000       (200)    13,790     (3,500)    21,500
      Production fuel                                          (302)    (1,113)     2,755      5,984      1,851      8,834
      Accounts payable                                       (3,287)    (9,425)    (8,586)   (10,213)     2,906     (1,661)
      Accrued taxes                                          (2,081)    (3,160)       463     (4,349)    (6,279)     1,141
      Provision for rate refunds                             (9,054)    (4,290)    (8,639)    (4,189)    (6,542)    (7,598)
      Adjustment clause balances                             (6,797)    (3,745)    (2,073)     7,750     (3,457)    (1,342)
      Gas in storage                                         (1,132)    (3,121)     8,958      8,858     (2,209)    (1,805)
      Deferred energy efficiency costs                       (3,772)    (2,717)    (7,171)    (3,902)   (13,016)    (8,944)
      Other                                                   1,869      1,577      1,501      2,611      6,321      4,209
           Net cash flows from operating activities          21,389     42,097     78,721     93,227    138,515    141,858

  Cash flows from financing activities:
      Dividends declared on common stock                    (15,000)    (5,700)   (22,000)   (15,700)   (37,600)   (24,190)
      Dividends declared on preferred and preference stock     (229)      (229)      (457)      (457)      (914)    (1,183)
      Dividends payable                                                            (5,000)                             229
      Equity infusion from parent company                                                     50,000                50,000
      Proceeds from issuance of long-term debt                                                          119,400     31,000
      Sinking fund requirements and reductions in
         long-term debt and preferred and preference stock     (224)   (60,224)      (224)   (60,224)   (19,624)   (96,048)
      Net change in short-term borrowings                    17,266     52,288     (6,734)   (14,312)   (60,982)    74,823
      Principal payments under capital lease obligations     (4,427)    (3,418)    (8,147)    (6,985)   (12,439)   (12,976)
      Other                                                                                                           (557)
            Net cash flows from financing activities         (2,614)   (17,283)   (42,562)   (47,678)   (12,159)    21,098

  Cash flows from investing activities:
      Construction and acquisition expenditures             (29,342)   (25,292)   (48,334)   (42,168)  (119,378)  (157,022)
      Nuclear decommissioning trust funds                    (1,384)    (1,384)    (2,767)    (2,767)    (5,532)    (5,532)
      Other                                                     (98)     1,874     (2,680)      (719)    (2,393)    (1,274)
           Net cash flows from investing activities         (30,824)   (24,802)   (53,781)   (45,654)  (127,303)  (163,828)

Net increase (decrease) in cash and
  temporary cash investments                                (12,049)        12    (17,622)      (105)      (947)      (872)

Cash and temporary cash investments
  at beginning of period                                     12,740      1,626     18,313      1,743      1,638      2,510

Cash and temporary cash investments
  at end of period                                       $      691 $    1,638 $      691 $    1,638 $      691 $    1,638

  Supplemental cash flow information:
      Cash paid during the period for -
         Interest                                        $   13,354 $   11,920 $   21,948 $   21,523 $   39,686 $   41,571
         Income taxes                                    $   18,659 $   17,501 $   18,619 $   21,283 $   37,409 $   39,306
      Noncash investing and financing activities -
         Capital lease obligations incurred              $      227 $    2,903 $      424 $   13,398 $    1,632 $   12,850

The accompanying Notes to Financial Statements are an integral
part of these statements.




                   NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

                                 June 30, 1994

(1)   GENERAL:

      The interim Financial  Statements have  been prepared  by IES  Utilities
Inc.  (the Company), without  audit, pursuant to the  rules and regulations of
the  Securities  and  Exchange Commission.    The  Company  is a  wholly-owned
subsidiary  of IES Industries Inc. (Industries) and  was formed as a result of
the  merger  of Industries'  former  wholly-owned  utility subsidiaries,  Iowa
Electric  Light and  Power Company  (IE) and  Iowa Southern  Utilities Company
(IS),  effective   December 31, 1993.     Certain  information   and  footnote
disclosures normally  included in financial statements  prepared in accordance
with generally accepted  accounting principles have been  condensed or omitted
pursuant to such rules and regulations, although the Company believes that the
disclosures are adequate to make the information presented not misleading.  In
the  opinion of the Company, the Financial Statements include all adjustments,
which are normal and recurring in nature, necessary  for the fair presentation
of the results  of operations and  financial position.   Certain prior  period
amounts  have  been  reclassified   on  a  basis  consistent  with   the  1994
presentation.

      It is suggested that  these Financial Statements be read  in conjunction
with the Financial Statements and the notes thereto included  in the Company's
Form 10-K for the year ended December 31, 1993.  The accounting and  financial
policies relative  to the following items  have been described  in those notes
and have been omitted  herein because they have not changed materially through
the date of this report:

      General
      Summary of significant accounting policies (other than discussed in Note
       2)
      Acquisition of Iowa service territory of Union Electric Company
      Leases (other than discussed in Note 6)
      Income taxes
      Benefit plans (other than discussed in Note 2(a))
      Preferred and preference stock
      Debt (other than discussed in Note 5)
      Estimated fair value of financial instruments (other than discussed in
       Note 2(b))
      Commitments
      Jointly-owned electric utility plant
      Segments of business

(2)   NEW ACCOUNTING STANDARDS:
      (a)   Accounting for Postemployment Benefits -

      On January 1, 1994, the  Company adopted the provisions of  Statement of
Financial  Accounting  Standards   (SFAS)  112,  "Employers'  Accounting   for
Postemployment Benefits," and  its adoption did not have a  material effect on
the Company's financial  position or  results of operations.   This  statement
requires  that  benefits  offered  to  former  or  inactive   employees  after
termination  of employment, but before retirement, be accrued over the service
lives of  the employees  if all of  the following  conditions are met:  1) the
obligation relates  to services  already performed;  2) the  employees' rights
vest;  3)  the  payments are  probable;  and  4)  the  amounts are  reasonably
determinable.   Otherwise, such obligations  are to be recognized  at the time
they become probable and reasonably determinable.   Prior to 1994, the Company
had generally accounted for these obligations as they were paid.

      (b)   Accounting for Certain Investments in Debt and Equity Securities -

      On  January 1,  1994,  the Company  adopted  SFAS 115,  "Accounting  for
Certain  Investments in  Debt and  Equity Securities."   This  standard, which
applies to the Company's nuclear decommissioning trust funds at June 30, 1994,
requires that  unrealized gains and losses on  such investments be included in
the  reported balance of such  investments.  At  June 30, 1994, the balance of
the  "Nuclear  decommissioning trust  funds" as  shown  in the  Balance Sheets
included $0.1  million of  unrealized losses  on the  investments held  in the
trust  funds.  The reserve for decommissioning costs, included in "Accumulated
depreciation"  in the Balance Sheets  was adjusted by  a corresponding amount,
and there was no effect on net income from adopting this standard.

(3)   RATE MATTERS:
      (a)   1991 Electric Rate Case -

      In October  1991, IE applied  to the Iowa  Utilities Board (IUB)  for an
increase in retail electric rates of $18.9 million annually, or 6.0%.  The IUB
approved an interim  rate increase  of $15.6 million,  annually, which  became
effective in December 1991, subject to refund.

      In  December 1992,  the  IUB issued  its   "Order  On Rehearing,"  which
affirmed its original decision  approving an annual electric rate  increase of
$7.9 million.  IE appealed one  issue in the IUB's Order to the  Iowa District
Court (Court) and, in  December 1993, the Court issued its  decision upholding
the IUB's Order.  As a result of the Court's decision, the Company completed a
refund  of $9.2 million,  including interest, in  the second  quarter of 1994.
There  was no effect  on electric revenues  or net income when  the refund was
made because the Company had been reserving for the effect of the refund.

      (b)   1994 Electric Rate Case -

      On July 8,  1994, the  Company applied  to the  IUB for  an increase  in
retail electric rates  of approximately  $21 million annually, or  4.3%.   The
Company's  proposal  includes  approximately  $19 million  in  annual  revenue
requirement  related to  increased  recovery levels  of depreciation  expense,
nuclear  decommissioning expense  and post-employment benefit  costs.   To the
extent these proposals  are approved  by the IUB,  corresponding increases  in
expense would be  recorded and there  would be no effect  on net income.   Any
increase approved by the IUB is not expected to be  effective before May 1995;
no interim increase was requested.

      Included in the requested increase is a  proposal to increase the annual
recovery of anticipated costs  to decommission the Duane Arnold  Energy Center
(DAEC), the  Company's nuclear generating plant,  to approximately $12 million
annually, from  the current level of $5.5 million.  Decommissioning expense is
included  in "Depreciation and amortization"  in the Statements  of Income and
the cumulative amount is included in "Accumulated depreciation" in the Balance
Sheets  to the extent recovered through  rates.  The proposal  is based on the
following assumptions:  1) cost to decommission the  DAEC of $252.7 million in
1993 dollars, based on the Nuclear Regulatory Commission (NRC) minimum formula
(which exceeds the amount in the current site-specific study); 2) inflation of
5.56% annually to the year 2014, when decommissioning is expected to begin; 3)
the prompt  dismantling  and removal  method  of decommissioning;  4)  monthly
funding of  all future collections into  external trust funds and  funded on a
tax-qualified basis to the extent possible; 5) an average after-tax return  of
5.88% for  all external investments; and 6) a collection method that levelizes
the recovery  through rates, in real  terms, through 2014.   Current levels of
rate recovery: 1)  do not recognize estimated future inflation  for the entire
period  prior to commencement of  the decommissioning process;  2) assume that
decommissioning begins in  2010; and  3) provide recovery  on a  straight-line
basis  without considering the effects of inflation.  Earnings on the external
trust  funds  are recorded  as interest  income  and a  corresponding interest
expense payable  to the funds  is recorded.   The earnings  accumulate in  the
external trust fund balances and in accumulated depreciation.

(4)   UTILITY ACCOUNTS RECEIVABLE:

      The Company has entered into an agreement, which expires in 1999, with a
financial  institution to sell, with limited recourse, an undivided fractional
interest  of up to $65 million in its pool of utility accounts receivable.  At
June 30, 1994, $53 million was sold under the agreement.

(5)   SHORT-TERM DEBT:

      At June 30, 1994, the Company had bank lines of credit aggregating $67.7
million  of which  $7.7 million was  being used  to support  pollution control
obligations and $3 million to  support commercial paper.  Commitment  fees are
paid to  maintain these lines and  there are no conditions  which restrict the
unused  lines of  credit.   In  addition  to  the above,  the  Company has  an
uncommitted credit facility with a financial institution whereby it can borrow
up to  $40 million.  Rates are  set at the time  of borrowing and  no fees are
paid to  maintain this facility.  At  June 30, 1994, there were no outstanding
borrowings  under this facility.   The Company also has a  letter of credit in
the  amount of  $3.4 million supporting  its variable  rate pollution  control
obligations.

(6)   OFFICE LEASE GUARANTY:

      The  Company  entered  into   a  five-year  lease  agreement,  effective
July 1, 1994,  as lessee  for its  corporate general  office in  Cedar Rapids,
Iowa.  The lessor  is a trust  (IES Utilities Trust,  not affiliated with  the
Company) formed by  various financial institutions.  The term  of the lease is
five years,  with  two one-year extensions  available at the Company's option.
The  Company had previously been leasing the building from a different lessor.
Pursuant to its Guaranty, if the Company defaults on its obligations under the
lease, the Company will be  required to pay all debt service  payments related
to the debt incurred  by the lessor for purchase of  the building, all amounts
payable with  respect to the  equity contributions (including a  return on the
contributions)  made to  the trust  by the  financial institutions,  and other
payments associated with the lease  transaction.  The aggregate amount  of the
potential payments with respect to the Guaranty is approximately $20 million.

(7)   CONTINGENCIES:
      (a)   Nuclear Insurance Programs -

      The  Price-Anderson  Amendments  Act of  1988  (1988  Act) provides  the
Company with  the  benefit  of  $9.158 billion of  public  liability  coverage
consisting  of  $200 million  of  insurance  and  $8.958 billion of  potential
retroactive assessments from the  owners of nuclear power plants.   Based upon
its ownership of the DAEC, under the 1988 Act, the Company could be assessed a
maximum of $79 million per nuclear incident, with a maximum of $10 million per
year (of which the Company's 70% ownership portion would be $55 million and $7
million,  respectively) if  losses  relating to  the  incidents exceeded  $200
million.   These limits  are subject to  adjustments for  inflation in  future
years.

      The  Company is a member  of Nuclear Electric  Insurance Limited (NEIL),
which provides insurance coverage for  the cost of certain property losses  at
nuclear  generating  stations and  for the  cost  of replacement  power during
certain  outages.  Companies insured  through NEIL are  subject to retroactive
premium  adjustments if  losses  exceed  accumulated  reserve funds.    NEIL's
accumulated  reserve funds are currently  sufficient to cover  its exposure in
the event  of a single incident under the property damage or replacement power
coverages.  However, the Company could be assessed annually a  maximum of $8.5
million for certain property  losses and $1  million for replacement power  if
NEIL's  losses relating to  accidents exceeded its  accumulated reserve funds.
The  Company is not aware of any losses  that it believes are likely to result
in an assessment.

      (b)   Environmental Liabilities -

      At June  30, 1994,  the Company's  Balance Sheets  reflect approximately
$24 million   (including  $4.3   million  as   current)  of   liabilities  for
investigation and  remediation of environmental  issues.  The  recorded amount
represents the Company's estimate of the minimum aggregate amount that will be
incurred for investigation  and remediation of the environmental issues, which
amount  is substantially  related to  clean-up costs  associated with  certain
former  manufactured gas  plant  (FMGP) sites.    In April 1994,  the  Company
received updated  investigation reports on a  number of sites, which,  at some
sites, indicated  a greater volume of contaminated material needing treatment,
and  a greater volume of  substances requiring higher  cost incineration, than
was  anticipated  in  prior   estimates.    Prior  estimates  were   based  on
investigations conducted at what were expected to be representative sites.  It
is  possible that  future  cost estimates  will be  greater  than the  current
estimates  as further  investigations are  conducted and  as  additional facts
become  known.  The Company has not initiated  the investigation on two of the
27 sites for which it  has been identified as a Potentially  Responsible Party
(PRP),  but  intends to  do  so, and  is  continuing work  on  sites requiring
remediation.

      The  Company has been  named as a PRP  for the FMGP  sites by either the
Iowa Department of Natural Resources (IDNR) or the United States Environmental
Protection  Agency (EPA).  The Company is working pursuant to the requirements
of the  IDNR and  EPA to investigate,  mitigate, prevent and  remediate, where
necessary, damage to property,  including damage to natural resources,  at and
around the  27 sites in  order to protect  public health and  the environment.
Such investigations are  expected to  be completed by  1999 and  site-specific
remediations  are anticipated  to be  completed within  three years  after the
completion of the investigations of each site.  The Company may be required to
monitor  these sites  for a number  of years  upon completion  of remediation.
Such monitoring costs are not included in the estimates above.

      The Company is investigating the possibility of obtaining monies through
insurance coverage and  third party  cost sharing for  FMGP investigation  and
clean-up costs.  The  amount of shared  costs, if any,  can not be  reasonably
determined  and,  accordingly,  no  potential sharing  has  been  recorded  at
June 30, 1994.    Regulatory assets  of  approximately $24  million  have been
recorded in  the Balance  Sheets, which  reflect the  future recovery that  is
being   provided  through  rates.    Considering  the  recorded  reserves  for
environmental  liabilities and  the past  rate treatment  allowed by  the IUB,
management believes that the clean-up costs incurred for these FMGP sites will
not  have a  material adverse  effect on the  Company's financial  position or
results of operations.

      (c)   Clean Air Act -

      The  Clean  Air  Act Amendments  Act  of  1990  (Act) requires  emission
reductions  of sulfur  dioxide and  nitrogen oxides  to achieve  reductions of
atmospheric chemicals believed to cause acid rain.  The provisions  of the Act
will be implemented in two phases with Phase I affecting two of  the Company's
units beginning in 1995 and Phase II affecting all units beginning in the year
2000.

      The Company  expects to meet the requirements of the Act by switching to
lower  sulfur fuels and through capital expenditures primarily related to fuel
burning equipment  and boiler modifications.   The  Company estimates  capital
expenditures at  approximately $28 million,  including $5 million in  1994, in
order to meet these requirements of the Act.

      (d)   National Energy Policy Act of 1992 -

      The National Energy Policy Act of 1992 requires  owners of nuclear power
plants  to pay a special assessment into a "Uranium Enrichment Decontamination
and  Decommissioning Fund."  The  assessment is based  upon prior nuclear fuel
purchases and, for the DAEC, averages  $1.4 million annually through 2007,  of
which the  Company's 70% share is $1.0 million.  The Company is recovering the
costs associated  with this  assessment through  its electric fuel  adjustment
clauses over  the period the costs are  assessed.  The Company's  70% share of
the future assessment, $12.9 million payable  through 2007, has been  recorded
as  a  liability in  the Balance  Sheets,  including $0.8 million  included in
"Current  liabilities - Other,"  with  a  related  regulatory  asset  for  the
unrecovered amount.

      (e)    Federal Energy Regulatory Commission (FERC) Order No. 636 -

      The  FERC issued  Order No.  636 (Order  636)  in 1992.   Order  636, as
modified  on  rehearing:  1) requires  the  Company's  pipeline  suppliers  to
unbundle  their services  so that  gas supplies  are obtained  separately from
transportation service,  and transportation and storage  services are operated
and  billed  as  separate and  distinct  services;  2)  requires the  pipeline
suppliers  to  offer  "no  notice" transportation  service  under  which  firm
transporters  (such as the  Company) can receive  delivery of gas  up to their
contractual capacity  level on  any  day without  prior scheduling;  3) allows
pipelines  to abandon  long-term  (one year  or  more) transportation  service
provided to a customer under an expiring contract whenever the customer  fails
to match the highest  rate and longest  term (up to 20  years) offered to  the
pipeline by other customers for the particular capacity; and 4) provides for a
mechanism  under which  pipelines  can recover  prudently incurred  transition
costs associated with the restructuring process.  The Company may benefit from
enhanced  access  to  competitively  priced   gas  supply  and  more  flexible
transportation services as a  result of Order 636.  However,  the Company will
be  required  to pay  certain  transition  costs incurred  and  billed by  its
pipeline suppliers as Order 636 is implemented.

      The  Company's three pipeline suppliers have filed tariffs with the FERC
implementing Order 636 and the pipelines  have also made filings with the FERC
to  begin collecting  their respective  transition costs.   The  Company began
paying  the  transition costs  in  November 1993, and,  at  June 30, 1994, has
recorded a liability of $5.1 million for  such transition costs that have been
incurred  by  the pipelines  to date,  including  $2.3 million expected  to be
billed through  June 1995.  While the magnitude  of the total transition costs
to be  charged to the Company  cannot yet be determined,  the Company believes
any transition  costs the FERC would  allow the pipelines to  collect would be
recovered  from its customers, based upon past regulatory treatment of similar
costs by the IUB.  Accordingly, regulatory assets, in amounts corresponding to
the liabilities, have been recorded to reflect the anticipated recovery.


                 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
             OF THE RESULTS OF OPERATIONS AND FINANCIAL CONDITION

      The following discussion analyzes  significant changes in the components
of net income and financial condition from the prior periods for IES Utilities
Inc. (the Company).

                             RESULTS OF OPERATIONS

      The Company's net  income available for common stock  as compared to the
same periods last year  decreased $1.2 million and $0.7 million for  the three
and six  month periods, respectively,  and increased $14.3 million  during the
twelve  month period  ended  June 30, 1994.   The  Company's operating  income
decreased $0.3 million and $0.8 million  for the three and six  month periods,
respectively,  and increased  $15.5 million  during the  twelve month  period.
Reasons for  the changes in  the results  of operations are  explained in  the
following discussion.

                               ELECTRIC REVENUES

      Electric revenues and  Kwh sales (before off-system  sales) increased or
(decreased) for the periods ended June 30, 1994,  compared with prior periods,
as follows:

                                    Revenues              Kwh Sales
                                   (millions)

       Three months             $        0.8                  2.7%
       Six months               $       (1.9)                 4.0%
       Twelve months            $       63.0                 13.3%


      After adjusting for the  effects of weather, sales increased  0.1%, 2.5%
and 11.6%  for the  three, six  and twelve month  periods, respectively.   The
underlying growth in the Company's service territory is reflected in increases
in  commercial and  industrial sales for  all periods.   The  increase for the
twelve  month period  also  reflects  the  acquisition  of  the  Iowa  service
territory  from Union Electric Company (UE) on December 31, 1992, for the full
1994  period, but for only one-half of the 1993 period.  Excluding the effects
of the  sales to the  former UE customers, sales  for the twelve  month period
increased 7.1%.

      The Company's  electric tariffs include energy  adjustment clauses (EAC)
that  are  designed to  currently recover  the costs  of  fuel and  the energy
portion of purchased power billings to customers.

      The revenue increase for the three month period was primarily the result
of the  Kwh sales  increase and  higher off-system sales  to other  utilities,
substantially  offset by lower fuel costs recovered  through the EAC and lower
average  revenue per  Kwh, in  part related  to the  sales mix  among customer
classes.

      The revenue decrease for  the six month period was  primarily related to
lower fuel costs  recovered through the EAC,  lower off-system sales  to other
utilities and lower average revenue per  Kwh, partially offset by the increase
in Kwh sales.

      The  revenue increase  for  the twelve  month  period was  substantially
because of  the increase in Kwh  sales, largely related to  the acquisition of
the UE territory,  increased off-system  sales to other  utilities and  higher
recoveries of fuel costs through the EAC.  These effects were partially offset
by lower average  revenue per Kwh primarily caused  by the mix of  sales among
customer classes,  as increased  sales  to lower  margin industrial  customers
comprised a significant portion of the sales increase.

                                 GAS REVENUES

      Gas revenues  decreased $1.6 million, $0.8 million and  $6.0 million for
the  three, six  and twelve  month periods ended  June 30, 1994, respectively.
The  Company's gas tariffs include purchased gas adjustment clauses (PGA) that
are designed to currently recover the cost of gas sold.   The reduction in gas
revenues for all periods was attributable to lower gas costs recovered through
the PGA  and lower dekatherm sales  to ultimate consumers.   Sales to ultimate
consumers decreased  4.5%, 4.3% and 4.9%  for the three, six  and twelve month
periods, respectively.   Including  transported volumes, sales  increased 6.9%
for the three month period, and decreased 0.6% and 1.5% for the six and twelve
month  periods, respectively.   After  adjusting for  the effects  of weather,
sales (including transported volumes)  increased 15.6% and 1.0% for  the three
and six  month  periods, respectively,  and  were flat  for  the twelve  month
period.

                              OPERATING EXPENSES

      Fuel for  production decreased $2.4 million and  $4.6 million during the
three and six month  periods, respectively, primarily because of  larger under
collections of fuel costs through the EAC in 1994; such  under collections are
recorded as  reductions to fuel  for production  expenses.  This  decrease was
partially offset by the effect of increased Kwh generation during the periods.
Fuel  for  production increased  $4.8 million during  the twelve  month period
primarily  because of increased Kwh generation  at the Company's fossil-fueled
generating stations,  partially offset  by lower generation  at the  Company's
nuclear generating plant, the  Duane Arnold Energy Center  (DAEC).  The  lower
generation at the DAEC was because of a refueling outage in the 1994 period.

      Purchased power  increased  $0.1 million and  $11.8 million  during  the
three and twelve month  periods, respectively, primarily because of  increased
energy purchases related to increased Kwh sales, partially offset by decreased
capacity charges.   The decreased  capacity charges were  attributable to  the
expiration, in April 1993,  of the Muscatine purchase power agreement,  net of
higher capacity costs relating to contracts associated with the acquisition of
the UE territory.  Purchased power decreased $8.5 million during the six month
period primarily because of a $7 million decrease in capacity charges relating
to the  expiration of the purchase power agreement with the City of Muscatine.
Lower energy purchases, primarily  because of lower off-system sales  to other
utilities  and increased  generation,  also contributed  to  the reduction  in
purchased power costs during this period.

      Gas  purchased  for  resale  decreased  $1.7 million,  $0.8 million  and
$6.8 million for the  three, six and twelve month periods,  respectively.  The
decrease for all periods is primarily due  to lower dekatherm sales, partially
offset by higher natural gas prices.

      Other operating  expenses decreased  $0.9  million for  the three  month
period  and increased  $2.3 million and  $6.3 million for  the six  and twelve
month  periods, respectively.   The  decrease for  the three  month period  is
primarily due to lower electric transmission and distribution costs, partially
offset  by higher  labor and  benefit costs.   The increases  for the  six and
twelve month periods are primarily attributable to increased labor and benefit
costs and higher information systems costs, partially offset by lower electric
transmission  and distribution costs and,  for the twelve  month period, lower
costs at the DAEC.

      Maintenance  expenditures  increased   $1.3 million,  $1.8 million   and
$3.8 million during  the three, six  and twelve  month periods,  respectively.
The  increases for all periods were primarily related to increased maintenance
activities  at  the  Company's  generating  stations  and  increased  electric
transmission and distribution expenditures.

      Depreciation  and amortization  increased during  all periods  primarily
because   of  increases  in  utility  plant  in  service.    Depreciation  and
amortization expenses for  both years include a  provision for decommissioning
the DAEC ($5.5 million annually), which is collected through rates.

      The staff of the Securities and Exchange Commission (SEC) has questioned
certain  of  the  current  accounting  practices  regarding  the  recognition,
measurement and classification of decommissioning costs for nuclear generating
stations  in the financial statements  of electric utilities.   In response to
these questions, the Financial Accounting Standards Board has agreed to review
the  accounting for removal costs, including decommissioning.  If such current
electric utility industry accounting  practices are changed, annual provisions
for  decommissioning could  increase, the  estimated cost  for decommissioning
could be recorded as a liability rather than as accumulated depreciation,  and
the  liability for the  entire expected cost  to decommission the  DAEC may be
required to be recorded currently.  If such changes are  required, the Company
believes that there  would not be an adverse effect  on its financial position
or results of operations based  on current rate making practices.   See Note 3
of  the  Notes   to  Financial   Statements  for  a   further  discussion   of
decommissioning.

      Property  taxes increased  $1.1 million, $2.4 million  and $5.4  million
during the three, six and twelve month periods, respectively.  These increases
are  primarily  because  of  increases  in  assessed  property  values.    The
acquisition of the  UE service territory also contributed  to the twelve month
increase.

      The increase in income taxes for all periods is, in part, because of the
effect of certain temporary differences  for which the Company did not  record
deferred  taxes pursuant to rate  making practices.   Increased pre-tax income
for the six and  twelve month periods and the  effect of a 1% increase  in the
Federal statutory income  tax rate in the twelve month period also contributed
to the increase for those periods.

                        LIQUIDITY AND CAPITAL RESOURCES

      The  Company's capital  requirements are  primarily attributable  to its
construction programs and debt maturities and sinking fund requirements.  Cash
flows from  operating activities  for the  twelve months  ended June 30, 1994,
were  approximately  $139 million.    These  funds  were  primarily  used  for
construction and acquisition expenditures.

      It is anticipated that the Company's future capital requirements will be
met by both cash flows from  operations and external financing.  The  level of
cash flows  from operations is  partially dependent upon  economic conditions,
legislative activities, environmental  matters and  timely rate  relief.   See
Note 3 and Note 7 of the Notes to Financial Statements for a discussion of the
Company's  rate  cases  and  contingencies.    Access  to  the  long-term  and
short-term  capital  and credit  markets  is  necessary  for  obtaining  funds
externally.

      The  Company's liquidity  and  capital  resources  will be  affected  by
environmental and  legislative issues,  including the ultimate  disposition of
remediation issues surrounding the former manufactured gas plant (FMGP) issue,
the Clean  Air Act  as amended, the  National Energy  Policy Act of  1992, and
Federal Energy Regulatory Commission  (FERC) Order 636, as discussed in Note 7
of the Notes to Financial Statements.  Consistent with rate making principles,
management  believes that the  costs incurred for  the above  matters will not
have  a  material adverse  effect  on the  financial  position  or results  of
operations of the Company.

      The  Iowa  Utilities Board  (IUB) has  adopted  rules which  mandate the
Company to  spend  2% of  electric  and 1.5%  of  gas gross  retail  operating
revenues for energy efficiency programs.  Energy efficiency costs in excess of
the amount in the most recent electric  and gas rate cases are being  recorded
as regulatory assets.  At June 30, 1994, the Company had $25.7 million of such
costs recorded as  regulatory assets.   Under this  mandate, the Company  will
make its  initial filing for recovery  of these costs in  mid-August 1994, but
does not expect to begin recovering the costs until 1995.

                     CONSTRUCTION AND ACQUISITION PROGRAM

      The   Company's   construction  and   acquisition   program  anticipates
expenditures of $150 million  for 1994, of which approximately  44% represents
expenditures  for  electric  transmission  and  distribution  facilities,  18%
represents fossil-fueled  generation expenditures  and 10% represents  nuclear
generation  expenditures.    The  Company  had  construction  and  acquisition
expenditures   of  approximately   $48 million  for   the  six   months  ended
June 30, 1994.   Substantial commitments have been made in connection with the
remaining anticipated expenditures.

      The Company's  levels of  construction and acquisition  expenditures are
projected  to be $149 million in  1995, $144 million in  1996, $149 million in
1997,  and $160 million in  1998.  It  is estimated that  approximately 80% of
construction  expenditures will be provided  by cash from operating activities
(after payment of dividends) for the five year period 1994-1998.

      Capital  expenditure,  investment and  financing  plans  are subject  to
continual  review and change.  The capital expenditure and investment programs
may  be revised  significantly as  a result  of many  considerations including
changes in economic  conditions, variations  in actual sales  and load  growth
compared  to  forecasts,  requirements  of environmental,  nuclear  and  other
regulatory   authorities,  acquisition  opportunities,   the  availability  of
alternate energy and purchased  power sources, the ability to  obtain adequate
and timely rate relief, escalations in construction costs and conservation and
energy efficiency programs.

                              LONG-TERM FINANCING

      Other than periodic sinking fund requirements, which the Company intends
to  meet  by  pledging  additional  property,  approximately  $124 million  of
long-term  debt has  scheduled  maturities prior  to  December 31, 1998.   The
Company  intends to  refinance  the  majority  of  the  debt  maturities  with
long-term debt.

      The Indentures pursuant to which the Company issues First Mortgage Bonds
constitute direct first mortgage liens upon  substantially all tangible public
utility  property and contain covenants that restrict the amount of additional
bonds that  may be  issued.   At June 30, 1994,  such restrictions  would have
allowed  the Company to issue $276 million of additional First Mortgage Bonds.
The  Company has  received authority from  the FERC  to issue  $250 million of
First Mortgage  Bonds  and  is  currently  authorized  by  the  SEC  to  issue
$50 million of long-term debt under an existing registration statement.

      The  Company's  Articles  of   Incorporation  authorize  and  limit  the
aggregate  amount  of  additional shares  of  Cumulative  Preferred Stock  and
Cumulative  Preference Stock  which  may be  issued.   At  June 30, 1994,  the
Company  could have issued 700,000 shares of Cumulative Preference Stock, $100
par value, and  100,000 additional shares of  Cumulative Preferred Stock,  $50
par value.

      The Company's capitalization ratios at June 30, were as follows:

                                     1994            1993

      Long-term debt                  48%            44%
      Preferred stock                  2              2
      Common equity                   50             54
                                     100%           100%


      The  1994 ratios include $50 million of long-term debt that is due
      in less  than one year   because it is the Company's intention to
      refinance  the debt with long-term issues.  The 1993 common equity
      ratio  was temporarily high because the Company had not yet issued
      long-term debt to replace other recently redeemed long-term debt.

                             SHORT-TERM FINANCING

      For  interim financing, the Company is  authorized by the FERC to issue,
through 1994, up to  $125 million of short-term notes.   This availability  of 
short-term  financing  provides  flexibility  in  the issuance of long-term
securities.   At  June 30, 1994, the  Company had  $3.0 million of  commercial
paper and $14.3 million of notes payable to associated companies outstanding.

      The  Company has an agreement,  which expires in  1999, with a financial
institution  to sell, with limited recourse,  an undivided fractional interest 
of $65 million in its pool of utility accounts receivable.  At  June 30, 1994,
$53 million had been sold under the agreement.

      At June 30, 1994, the Company had bank lines of credit aggregating $67.7
million, of which  $7.7 million was  being used to  support pollution  control
obligations and $3.0 million to support commercial paper.  Commitment fees are
paid to  maintain these lines and  there are no conditions which restrict the 
unused  lines of  credit.   In  addition  to  the above,  the  Company has  an
uncommitted credit facility with a financial institution whereby it can borrow
up to $40 million.  The  Company also has a letter of credit in  the amount of
$3.4  million supporting its variable rate pollution control obligations.

                             ENVIRONMENTAL MATTERS

      At  June 30, 1994,  the Company's  Balance Sheets  reflect approximately
$24 million of liabilities for  investigation and remediation of environmental
issues.  The recorded amount represents the Company's estimate of the minimum
aggregate  amount that will be  incurred for investigation  and remediation of
the environmental issues,  which amount is  substantially related to  clean-up
costs associated with certain  former manufactured gas plant (FMGP) sites.  In
April 1994,  the Company received updated investigation reports on a number of
sites,  which, at  some  sites, indicated  a  greater volume of contaminated
material needing  treatment,  and a  greater  volume of  substances  requiring
higher  cost incineration,  than was  anticipated in  prior estimates.   Prior
estimates were based on  investigations conducted at what were  expected to be
representative  sites.   It  is possible  that future  cost estimates  will be
greater than the current estimates as further investigations are conducted and
as  additional  facts  become  known.    The  Company has  not  initiated  the
investigation  on two of the  27 sites for  which it has been  identified as a
Potentially  Responsible Party (PRP), but intends  to do so, and is continuing
work on sites requiring remediation.

      Considering the recorded reserves  for environmental liabilities and the
past rate treatment allowed by the IUB, management believes that the  clean-up
costs incurred for these FMGP sites will not have a material adverse effect on
its financial position or results of operations.

      Refer to Note 7  of the  Notes to Financial  Statements for  information
relating to  potential environmental liabilities associated  with certain FMGP
sites.

      The Low-Level  Radioactive Waste Policy  Amendments Act  of 1985  (Act),
which mandated that  each state must  take responsibility for  the storage  of
low-level radioactive waste produced  within its borders, will have  an impact
on  disposal practices for low-level  radioactive waste over  the next several
years.    The State  of  Iowa  has  joined  the Midwest  Interstate  Low-Level
Radioactive Waste  Compact Commission  (Midwest Compact Commission), which is
planning a storage facility to be located in Ohio to  store waste generated by
the  six states  in the  Midwest Compact  Commission.   At  June 30, 1994, the
Company  has prepaid costs  of approximately $1 million  (included in "Current
assets - Prepayments and  other" in the Balance Sheets) to the Midwest Compact
Commission  for the  building  of such  a  facility.  Due to the legal and  
political uncertainties, the  Company cannot estimate the  future payments, if
any, that will be made to the Midwest Compact Commission.

      The  Company and  the other  members of  the Midwest  Compact Commission
shipped their  low-level wastes  to waste  management facilities in Barnwell,
South   Carolina,  Hanford,   Washington   and/or   Beatty,   Nevada   through
June 30, 1994.   Currently, the  Company is storing  its low-level radioactive
waste  generated at  the  DAEC on-site  until  new disposal  arrangements  are
finalized  among  the Midwest  Compact  Commission members.    On-site storage
capability currently  exists for  low-level radioactive waste expected to be
generated through the DAEC's license life under normal operating conditions.

      In  February 1993, the  Nuclear Regulatory  Commission (NRC)  proposed a
rule  that would  not permit  on-site storage  of low-level radioactive waste
after January 1, 1996, unless the generator of such waste can document that it
has  exhausted  other reasonable  waste management  options.   The  Company is
currently  investigating  its  options  for  the  disposal  of  its  low-level
radioactive waste.



                         PART II. - OTHER INFORMATION

Item 1.  Legal Proceedings.
      Reference is made to Notes 3 and 7 of  the Notes to Financial Statements
for a discussion of rate matters and environmental matters, respectively.

Item 2.  Changes in the Rights of the Company's Security Holders.
None.

Item 3.  Default Upon Senior Securities.
None.

Item 4.  Results of Votes of Security Holders.

      (a)   The   Company  held   its  annual   Meeting  of   Shareholders  on
            May 17, 1994.
      (b)   The  following  matter was  voted upon  at  the Annual  Meeting of
            Shareholders:

            The  election of  nominees  for Directors  who  will serve  for  a
            one-year term or  until their respective successors shall be duly
            elected.  The nominees, all of whom were elected, were as follows:

            C.R.S. Anderson, J. Wayne Bevis, Dr. George Daly, Blake O. Fisher,
            Jr., G. Sharp Lannom, IV, Lee  Liu, Robert D. Ray, David  Q. Reed,
            Henry Royer, Robert W. Schlutz, and Anthony R. Weiler.

            IES Industries  Inc., the sole  shareholder of the  Company, voted
            all 13,370,788 shares for the election of the above nominees.

Item 5.  Other Information.

      a)    The  Company has calculated the ratio of earnings to fixed charges
            pursuant  to  Item 503  of Regulation  S-K  of the  Securities and
            Exchange Commission as follows:

             For the twelve months ended:

                  June 30, 1994                  3.39
                  December 31, 1993              3.41
                  December 31, 1992              2.49
                  December 31, 1991              2.64
                  December 31, 1990              2.65
                  December 31, 1989              2.82


      b)    Effective August 2, 1994, Mr. Jack R. Newman, President of the law
            firm of Newman, Bouknight, & Edgar, P.C. was elected to serve on
            the Company's Board of Directors.

            For the  twelve months  ended June 30, 1994, the  Company incurred 
            $596,483 for legal services with Mr. Newman's firm.

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

(a)   Exhibits -
      *  3(a)           Bylaws of Registrant, as amended May 17, 1994.

       10(a)            Receivables  Purchase and  Sale Agreement dated  as of
                        June 30, 1989,  as   Amended   and  Restated   as   of
                        April 15, 1994, among  IES Utilities Inc. (as Seller)
                        and CIESCO  L.P. (as the Investor)  and Citicorp North
                        America,  Inc. (as Agent).  (Filed as Exhibit 10(a) to
                        the  Company's   Form  10-Q  for  the   quarter  ended
                        March 31, 1994).

      *10(b)            Guaranty  (IES Utilities  Trust  No. 1994-A)  from IES
                        Utilities Inc., dated as of June 29, 1994.

      *12         Ratio of Earnings to Fixed Charges.

      *  Exhibits designated by an asterisk are filed herewith.

(b)   Reports on Form 8-K -
      None.



                                  SIGNATURES



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


                                      IES UTILITIES INC.
                                         (Registrant)



Date August 10, 1994                  By /s/    Dr. Robert J. Latham
                                                     (Signature)
                                                Dr. Robert J. Latham
                                         Senior Vice President, Finance
                                         and Corporate Affairs, & Treasurer




                                      By /s/    Richard A. Gabbianelli
                                                      (Signature)
                                                Richard A. Gabbianelli
                                         Controller & Chief Accounting Officer