SECURITIES AND EXCHANGE COMMISSION
                               Washington, D. C.
                                     20549


                                   FORM 10-Q




For the Quarter Ended                           Commission file number 1-2661
     March 31, 1998




                              CSS INDUSTRIES, INC.
              ----------------------------------------------------
             (Exact name of registrant as specified in its Charter)


         Delaware                                              13-1920657
         --------                                              ----------
(State or other jurisdiction of                             (I.R.S. Employer
incorporation or organization)                           Identification number)




1845 Walnut Street, Philadelphia, PA                                 19103
- ----------------------------------------                           ----------
(Address of principal executive offices)                           (Zip Code)




                                 (215) 569-9900
             ------------------------------------------------------
              (Registrant's telephone number, including area code)



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 March 31, 1998, there were 11,035,962 shares of Common Stock outstanding
which excludes shares which may still be issued upon exercise of stock options.


                                  Page 1 of 10



                      CSS INDUSTRIES, INC. AND SUBSIDIARIES

                                      INDEX





PART I - FINANCIAL INFORMATION


In the opinion of management, the accompanying unaudited consolidated condensed
financial statements contain all adjustments necessary to present fairly the
financial position as of March 31, 1998 and December 31, 1997 and the results of
operations and cash flows for the three months ended March 31, 1998 and 1997.
The results for the three months ended March 31, 1998 and 1997 are not
necessarily indicative of the expected results for the full year. As certain
previously reported notes and footnote disclosures have been omitted, these
financial statements should be read in conjunction with the latest annual report
on Form 10-K.


                                                                       PAGE NO.

Consolidated Statements of Operations - Three months ended
March 31, 1998 and 1997                                                    3

Consolidated Condensed Balance Sheets - March 31, 1998 and
December 31, 1997                                                          4

Consolidated Statements of Cash Flows - Three months ended
March 31, 1998 and 1997                                                    5

Notes to Consolidated Financial Statements                                6-7

Management's Discussion and Analysis of Financial Condition
and Results of Operations                                                 8-9

PART II - OTHER INFORMATION

Items 1 through 6 - Not Applicable

SIGNATURE                                                                  10






                                       -2-







                      CSS INDUSTRIES, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

(In thousands, except
 per share amounts)


                                                                  Three Months Ended
                                                                       March 31,
                                                             ----------------------------
                                                               1998                1997
                                                             --------            --------
                                                                               (Restated)
                                                                                
SALES                                                        $ 27,959            $ 24,530
                                                             --------            --------

COSTS AND EXPENSES
   Cost of sales                                               19,370              16,766
   Selling, general and administrative expenses                17,981              15,168
   Interest expense, net                                          401               1,084
   Rental and other income, net                                  (578)               (288)
                                                             --------            --------

                                                               37,174              32,730
                                                             --------            --------
LOSS FROM CONTINUING OPERATIONS
   BEFORE INCOME TAXES                                         (9,215)             (8,200)

INCOME TAX BENEFIT                                             (3,456)             (3,169)
                                                             --------            --------

NET LOSS FROM CONTINUING OPERATIONS                            (5,759)             (5,031)

DISCONTINUED OPERATIONS
   Income from discontinued operations, net of
     income taxes of $1,161                                      --                 1,533
   Gain on sale of discontinued operations, net of
     income taxes of $0                                          --                   350
                                                             --------            --------

NET LOSS                                                     $ (5,759)           $ (3,148)
                                                             ========            ========

NET LOSS PER COMMON SHARE
   Basic
       Continuing operations                                 $   (.52)           $   (.46)
       Discontinued operations                                   --                   .14
       Gain on sale of discontinued operations                   --                   .03
                                                             --------            --------
                                                             $   (.52)           $   (.29)
                                                             ========            ========
   Diluted
       Continuing operations                                 $   (.52)           $   (.46)
       Discontinued operations                                   --                   .14
       Gain on sale of discontinued operations                   --                   .03
                                                             --------            --------
                                                             $   (.52)           $   (.29)
                                                             ========            ========

WEIGHTED AVERAGE SHARES OUTSTANDING
     Basic                                                     11,002              10,805
                                                             ========            ========
     Diluted                                                   11,002              10,805
                                                             ========            ========

CASH DIVIDENDS PER SHARE OF COMMON STOCK                     $   --              $   --
                                                             ========            ========


                 See notes to consolidated financial statements.
                                       -3-






                      CSS INDUSTRIES, INC. AND SUBSIDIARIES

                      CONSOLIDATED CONDENSED BALANCE SHEETS

(In thousands)



                                                             March 31,        December 31,
                                                               1998               1997
                                                             --------           --------
                                                            (Unaudited)

            ASSETS
                                                                            
CURRENT ASSETS
    Cash and temporary investments                           $ 11,333           $  1,365
    Accounts receivable, net                                   31,429            165,761
    Inventories                                                99,705             66,270
    Deferred taxes                                                726                726
    Other current assets                                       11,661              9,909
                                                             --------           --------

       Total current assets                                   154,854            244,031
                                                             --------           --------

PROPERTY, PLANT AND EQUIPMENT, NET                             46,188             44,868
                                                             --------           --------

OTHER ASSETS
    Intangible assets                                          38,202             38,648
    Deferred income taxes                                         330                330
    Other                                                      14,298             14,485
                                                             --------           --------

        Total other assets                                     52,830             53,463
                                                             --------           --------

        Total assets                                         $253,872           $342,362
                                                             ========           ========

    LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES
     Notes payable                                           $     51           $ 51,570
     Other current liabilities                                 31,374             63,216
                                                             --------           --------

        Total current liabilities                              31,425            114,786
                                                             --------           --------

LONG-TERM OBLIGATIONS                                           5,764              5,927

SHAREHOLDERS' EQUITY                                          216,683            221,649
                                                             --------           --------

        Total liabilities and shareholders' equity           $253,872           $342,362
                                                             ========           ========




                 See notes to consolidated financial statements.

                                       -4-





                      CSS INDUSTRIES, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

(In thousands)


                                                                                       Three Months Ended
                                                                                            March 31,
                                                                                  ------------------------------
                                                                                     1998                1997
                                                                                  ---------            ---------
                                                                                                      (Restated)
                                                                                                   
Cash flows from operating activities:
    Net loss                                                                      $  (5,759)           $  (3,148)
                                                                                  ---------            ---------

    Adjustments to reconcile net loss to net cash provided by operating
       activities:
       Discontinued operations                                                         --                  1,596
       Depreciation and amortization                                                  2,359                1,667
       (Gain) loss on sale of assets, net                                                (2)                   7
       Gain on sale of discontinued operations                                         --                   (350)
       Deferred tax provision                                                          --                      1
       Provision for doubtful accounts                                                  132                  181
       Changes in assets and liabilities, net:
          Decrease in accounts receivable                                           130,157              131,684
          (Increase) in inventories                                                 (33,435)             (26,134)
          (Increase) in other assets                                                 (1,647)              (2,754)
          (Decrease) in other current liabilities                                    (4,789)             (20,870)
          (Decrease) in accrued income taxes                                        (22,193)              (7,979)
                                                                                  ---------            ---------

             Total adjustments                                                       70,582               77,049
                                                                                  ---------            ---------

             Net cash provided by operating activities                               64,823               73,901
                                                                                  ---------            ---------

Cash flows from investing activities:
    Purchase of business, net of cash received of $976                                 --                (17,564)
    Purchase of property, plant and equipment                                        (3,499)              (4,329)
    Proceeds from sale of business                                                     --                  4,083
    Proceeds on sale of property                                                         37                  189
                                                                                  ---------            ---------

             Net cash used for investing activities                                  (3,462)             (17,621)
                                                                                  ---------            ---------

Cash flows from financing activities:
    Payments on long-term obligations                                                  (667)                (257)
    Repayments on notes payable, net                                                (51,519)             (56,200)
    Purchase of treasury stock                                                         (470)                (644)
    Proceeds from exercise of stock options                                           1,263                  934
                                                                                  ---------            ---------

             Net cash used for financing activities                                 (51,393)             (56,167)
                                                                                  ---------            ---------

Net increase in cash and temporary investments                                        9,968                  113

Cash and temporary investments at beginning of period                                 1,365                2,690
                                                                                  ---------            ---------
Cash and temporary investments at end of period                                   $  11,333            $   2,803
                                                                                  =========            =========




                 See notes to consolidated financial statements.

                                       -5-





                      CSS INDUSTRIES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                 March 31, 1998



(1)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

      Principles of Consolidation -

      The consolidated financial statements include the accounts of the Company
         and all subsidiaries. All significant intercompany transactions and
         accounts have been eliminated in consolidation and all adjustments are
         of a normal recurring nature.

      Restatement of Prior Years Financial Statements -

      On December 23, 1997, the Company sold its Direct Mail Business Products
         Group, composed of Rapidforms, Inc. and its subsidiaries
         ("Rapidforms"). The gain on the sale and the operating results of
         Rapidforms prior to the sale have been accounted for as discontinued
         operations and, accordingly, have been segregated on the prior period
         financial statements and footnotes.

      Nature of Business -

      CSS is a consumer products company primarily engaged in the manufacture
         and sale to mass market retailers of seasonal, social expression
         products, including gift wrap, gift bags, boxed greeting cards, gift
         tags, tissue paper, paper and vinyl decorations, calendars, classroom
         exchange Valentines, decorative ribbons and bows, Halloween masks,
         costumes, make-ups and novelties and Easter egg dyes and novelties. Due
         to the seasonality of the Company's business, the majority of sales
         occur in the third and fourth quarters and a material portion of the
         Company's trade receivables are due in December and January of each
         year.

       As a result of the sale of Rapidforms on December 23, 1997, CSS no longer
         operates in the Direct Mail Business Products industry.

      Use of Estimates -

       The preparation of financial statements in conformity with generally
         accepted accounting principles requires management to make estimates
         and assumptions that affect the reported amounts of assets and
         liabilities and disclosure of contingent assets and liabilities at the
         date of the financial statements and the reported amounts of revenues
         and expenses during the reporting period. Actual results could differ
         from those estimates.

      Inventories -

       Inventories of certain subsidiaries are stated at the lower of first-in,
         first-out (FIFO) cost or market while the remaining portion of the
         inventory is valued at the lower of last-in, first-out cost or market.
         Inventories consisted of the following:




                                       -6-





                                                      March 31,    December 31,
                                                        1998           1997
                                                    -----------    -----------
                  Raw material...............       $29,693,000    $23,840,000
                  Work-in-process............        18,829,000      9,789,000
                  Finished goods.............        51,183,000     32,641,000
                                                    -----------    -----------
                                                    $99,705,000    $66,270,000
                                                    ===========    ===========

      Revenue Recognition -

      The Company recognizes revenues in accordance with its shipping terms.
         Returns and allowances are reserved for based on the Company's
         historical experience.

      Net Loss Per Common Share -

      Basic net loss per common share is based on the weighted average number of
         common shares outstanding during the first quarter - 11,001,728 in 1998
         and 10,804,747 in 1997. Average outstanding shares used in the
         computation of diluted net loss per share were 11,001,728 in 1998 and
         10,804,747 in 1997.

       As of March 31, 1998, the numerator and denominator in the basic and
         diluted earnings per share computations are equal as the Company has a
         net loss for the three months ended March 31, 1998. Common stock
         equivalents are not used in the computation of diluted earnings per
         share as they would have an anti-dilutive effect in the periods
         presented.

      Statements of Cash Flows -

      For purposes of the statements of cash flows, the Company considers all
         holdings of highly liquid debt instruments with original maturity of
         less than three months to be temporary investments.

       See Note 2 for supplemental disclosure of noncash investing activities.

(2)  BUSINESS ACQUISITIONS AND DIVESTITURES:

         On December 23, 1997, the Company sold Rapidforms and its subsidiaries
for approximately $84,635,000, resulting in a net gain of $17,521,000 and net
cash proceeds of approximately $60,000,000 after income taxes and the buy out of
the minority interest. Rapidforms designs and sells business forms, business
supplies, in-house retail merchandising products, holiday greeting cards and
advertising specialties to small and medium size businesses primarily through
the direct mailing of catalogs and brochures. On January 8, 1997, Rapidforms
sold its Standard Forms, Ltd. subsidiary for $4,083,000, resulting in a gain of
$350,000. Sales from these discontinued operations were $19,714,000 for the
first three months of 1997.

         On January 17, 1997, the Company acquired all of the outstanding stock
of Color-Clings, Inc. ("Color-Clings") for $7,875,000 and repaid $10,665,000 of
debt. Color-Clings is a designer and marketer of seasonal and everyday vinyl
home decorations sold primarily to mass market retailers in the United States
and Canada. The acquisition was accounted for as a purchase and the excess of
cost over fair market value of $15,698,000 was recorded as goodwill and is being
amortized over twenty years. Subsequent to the acquisition, a substantial
portion of the operations of Color-Clings were merged into existing operations
of the Company.


                                       -7-







                      CSS INDUSTRIES, INC. AND SUBSIDIARIES

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

                       CONDITION AND RESULTS OF OPERATIONS


RESULTS OF OPERATIONS

Three Months of 1998 Compared to Three Months of 1997

     Consolidated sales for the three months ended March 31, 1998 increased by
14% to $27,959,000 from $24,530,000 in 1997. The increase in sales was primarily
attributable to increased sales of Easter products and non-seasonal ribbons and
bows. These increases were partially offset by lower closeout sales volume due
to improved inventory management.

     Cost of sales, as a percentage of sales, was 69% in 1998 and 68% in 1997.
The increase in the cost of sales percentage was due to the recording of
approximately $600,000 of restructuring costs associated with the shutdown of
two manufacturing and distribution facilities. Net of restructuring costs, cost
of sales, as a percentage of sales, decreased to 67% reflecting increased
margins due to the impact of lower close-out sales volume. Selling, general and
administrative ("SG&A") expense as a percentage of sales increased to 64% from
62% in 1997. The increase in SG&A expense as a percentage of sales was due to
the recording of approximately $1,100,000 in restructuring charges relating to
the blending of certain functions within the Company. Net of these restructuring
charges, SG&A expenses, as a percentage of sales, declined to 60% due to the
increased sales base. SG&A expense as a percentage of sales will decline as
higher shipments are made in the second half of the year.

     Interest expense, net decreased from $1,084,000 in 1997 to $401,000 as the
cash received from the sale of Rapidforms resulted in lower borrowing needs.
Rental and other income, net increased to $578,000 from $288,000. This increase
was primarily attributable to the rental income from the sublease of a portion
of one of the Company's distribution centers.

     Income taxes as a percentage of income before taxes were 38% in 1998
compared to 39% in the first quarter of 1997. The decrease is attributable to
lower state income tax expense.

     The net loss from continuing operations for the three months ended March
31, 1998 was $5,759,000, or $.52 per share, compared to a net loss from
continuing operations of $5,031,000, or $.46 per share, in 1997. The increased
loss reflected the restructuring charges discussed above.

LIQUIDITY AND CAPITAL RESOURCES

     At March 31, 1998, the Company had working capital of $123,429,000 and
shareholders' equity of $216,683,000. The decrease in accounts receivable and
the increase in inventories from December 31, 1997 reflected seasonal
collections of Christmas receivables and normal seasonal inventory increases in
preparation for the 1998 shipping season. The decrease in other current
liabilities reflected the payment of income taxes, sales commissions, royalties
and employee benefits.





                                       -8-





     The Company relies primarily on cash generated from its operations and
seasonal borrowings to meet its liquidity requirements. Most revenues are
seasonal with approximately 75% of sales generated in the second half of the
year. Payment for Christmas related products is usually not received until after
the holiday in accordance with general industry practice. As a result,
short-term borrowing needs decreased $51,519,000 in the first quarter of 1998
and will increase throughout the remainder of the year, peaking prior to
Christmas. Seasonal borrowings are made under an unsecured revolving credit
facility with fourteen banks and financial institutions. The credit facility is
available to fund the seasonal borrowing needs and to provide the Company with a
source of capital for general corporate purposes. At March 31, 1998, no
borrrowings were outstanding under this facility.

     Based on its current operating plan, the Company believes its sources of
available capital are adequate to meet its ongoing cash needs for the
foreseeable future.

Information Systems

     The Company has initiated a series of information systems improvements in
the past two years, including the conversion of certain other computer systems 
for compliance with the Year 2000. Costs incurred to modify existing systems to 
process transactions regarding the Year 2000 have been and will be expensed as 
incurred and are not expected to have a significant impact on the Company's
ongoing results of operations.































                                       -9-






                                    SIGNATURE






     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.







                                   CSS INDUSTRIES, INC.
                                  (Registrant)




Date:  May 14, 1998                        By: /s/ James G. Baxter
                                               ----------------------------
                                               James G. Baxter
                                               Executive Vice President,
                                               Chief Financial Officer and
                                               Principal Accounting Officer






















                                      -10-