<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q
FOR THE PERIOD ENDED SEPTEMBER 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0001002531
<NAME> TOLLGRADE COMMUNICATIONS, INC.
       
                             
<PERIOD-TYPE>                   9-MOS
<FISCAL-YEAR-END>                          DEC-31-1996
<PERIOD-START>                             JAN-01-1996
<PERIOD-END>                               SEP-30-1996
<CASH>                                       3,191,388
<SECURITIES>                                12,414,888
<RECEIVABLES>                                3,875,303
<ALLOWANCES>                                  (50,000)
<INVENTORY>                                  8,705,838
<CURRENT-ASSETS>                            28,783,914
<PP&E>                                       3,776,761
<DEPRECIATION>                               1,203,409
<TOTAL-ASSETS>                              31,525,299
<CURRENT-LIABILITIES>                        4,542,788
<BONDS>                                              0
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                     1,113,527
<OTHER-SE>                                  25,664,942
<TOTAL-LIABILITY-AND-EQUITY>                31,525,299
<SALES>                                     27,112,057
<TOTAL-REVENUES>                            27,112,057
<CGS>                                       13,435,042
<TOTAL-COSTS>                               13,435,042
<OTHER-EXPENSES>                                     0
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                                   0
<INCOME-PRETAX>                              6,388,037
<INCOME-TAX>                                 2,422,695
<INCOME-CONTINUING>                                  0
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                 3,965,342
<EPS-PRIMARY>                                     0.67
<EPS-DILUTED>                                     0.67