<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-K
FOR THE YEAR ENDED DECEMBER 31, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0001002531
<NAME> TOLLGRADE COMMUNICATIONS, INC.
       
                             
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1998
<PERIOD-START>                             JAN-01-1998
<PERIOD-END>                               DEC-31-1998
<CASH>                                       8,311,353
<SECURITIES>                                14,249,164
<RECEIVABLES>                                8,288,740
<ALLOWANCES>                                   100,000
<INVENTORY>                                 13,201,771
<CURRENT-ASSETS>                            44,658,332
<PP&E>                                       7,146,114
<DEPRECIATION>                               3,831,592
<TOTAL-ASSETS>                              49,864,575
<CURRENT-LIABILITIES>                        4,118,858
<BONDS>                                              0
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                     1,184,093
<OTHER-SE>                                  44,511,674
<TOTAL-LIABILITY-AND-EQUITY>                49,864,575
<SALES>                                     45,767,409
<TOTAL-REVENUES>                               510,000
<CGS>                                       19,620,226
<TOTAL-COSTS>                               19,620,226
<OTHER-EXPENSES>                                     0
<LOSS-PROVISION>                                50,000
<INTEREST-EXPENSE>                                   0
<INCOME-PRETAX>                             11,007,102
<INCOME-TAX>                                 4,039,800
<INCOME-CONTINUING>                                  0
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                 6,967,302
<EPS-PRIMARY>                                     1.19
<EPS-DILUTED>                                     1.17