SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [_]

Check the appropriate box:

[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))

[X] Definitive Proxy Statement

[_] Definitive Additional Materials

[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12

Quality Dining, Inc.
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(Name of Registrant as Specified In Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required

[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
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[_] Fee paid previously with preliminary materials.

[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

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Notes:

QUALITY DINING, INC.

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MARCH 9, 1999

The annual meeting of shareholders of Quality Dining, Inc. will be held at
Quality Dining, Inc., 4220 Edison Lakes Parkway, Mishawaka, Indiana, on Tuesday,
March 9, 1999, at 10:00 a.m., Mishawaka time, for the following purposes:

(1) To elect one Director to serve until the 2002 annual meeting of
shareholders and until his successor is elected and has qualified;

(2) To approve the appointment of PricewaterhouseCoopers LLP as auditors
for the Company for fiscal 1999; and

(3) To transact such other business as may properly come before the
meeting.

All shareholders of record at the close of business on January 20, 1999
will be eligible to vote.

It is important that your shares be represented at this meeting. Whether or
not you expect to be present, please fill in, date, sign and return the enclosed
proxy form in the accompanying addressed, postage-prepaid envelope. If you
attend the meeting, you may revoke your proxy and vote in person.

John C. Firth, Secretary

QUALITY DINING, INC.

4220 Edison Lakes Parkway
Mishawaka, Indiana 46545

PROXY STATEMENT

Annual Meeting of Shareholders
March 9, 1999

This statement is being furnished to shareholders on or about February 5,
1999, in connection with a solicitation by the Board of Directors of Quality
Dining, Inc. (the "Company") of proxies to be voted at the annual meeting of
shareholders to be held at 10:00 a.m., Mishawaka time, Tuesday, March 9, 1999,
at Quality Dining, Inc., 4220 Edison Lakes Parkway, Mishawaka, Indiana, for the
purposes set forth in the accompanying Notice.

At the close of business on January 20, 1999, the record date for the
meeting, there were 12,599,444 shares of Common Stock of the Company outstanding
and entitled to vote at the meeting. On all matters, including the election of
Directors, each shareholder will have one vote for each share held.

If the enclosed form of proxy is executed and returned, it may nevertheless
be revoked at any time insofar as it has not been exercised. If a shareholder
executes more than one proxy, the proxy having the latest date will revoke any
earlier proxies. A shareholder attending the meeting will be given the
opportunity to revoke his or her proxy and vote in person.

Unless revoked, a proxy will be voted at the meeting in accordance with the
instructions of the shareholder in the proxy, or, if no instructions are given,
for the election as Directors of all nominees listed under Proposal 1 and for
Proposal 2. Election of Directors will be determined by the vote of the holders
of a plurality of the shares voting on such election. Approval of Proposal 2
will be subject to the vote of the holders of a greater number of shares
favoring approval than those opposing it. A proxy may indicate that all or a
portion of the shares represented by such proxy are not being voted with respect
to a specific proposal. This could occur, for example, when a broker is not
permitted to vote shares held in street name on certain proposals in the absence
of instructions from the beneficial owner. Shares that are not voted with
respect to a specific proposal will be considered as not present and entitled to
vote on such proposal, even though such shares will be considered present for
purposes of determining a quorum and voting on other proposals. Abstentions on
a specific proposal will be considered as present, but not as voting in favor of
such proposal. As a result, with respect to all of the proposals, neither
broker non-votes nor abstentions on such proposals will affect the determination
of whether such proposals will be approved.

The Board of Directors knows of no matters, other than those described in
the attached Notice of Annual Meeting, which are to be brought before the
meeting. If other matters properly come before the meeting, it is the intention
of the persons named in the enclosed form of proxy to vote such proxy in
accordance with their judgment on such matters.

The cost of the solicitation of proxies will be borne by the Company.

ELECTION OF DIRECTORS

Nominees

Currently, the Board of Directors of the Company consists of seven
Directors divided into three classes. Two classes contain two Directors each,
with the remaining class containing three Directors. The term of one class of
Directors expires each year. Generally, each Director serves until the annual
meeting of shareholders held in the year that is three years after such
Director's election and until such Director's successor is elected and has
qualified.

One Director is to be elected at the meeting. It is the intention of the
persons named in the accompanying form of proxy to vote such proxy for the
election to the Board of Directors of Mr. Christopher J. Murphy III, whose term
expires this year. He has been nominated by the Board of Directors for
reelection as a Director for a term to expire at the 2002 annual meeting of
shareholders and until his successor is elected and has qualified. If Mr.
Murphy is unable or unwilling to accept nomination or election, it is the
intention of the persons named in the accompanying form of proxy to nominate
such other person as Director as they may in their discretion determine, in
which event the shares will be voted for such other person. Mr. William R.
Schonsheck, whose term also expires this year, has chosen not to stand for
reelection at the 1999 annual meeting of shareholders.

The Company's By-Laws provide for a Board of Directors consisting of seven
members. Following the meeting, and assuming the election of Mr. Murphy, six
Directors will continue to serve on the Board of Directors and one vacancy will
exist. The accompanying form of proxy cannot be voted for a greater number of
persons than the one nominee for Director listed below. Although the Board of
Directors may elect other Directors to the Board at a later date, there is no
present intention to do so.

Unless otherwise indicated in a footnote to the following table, the
principal occupation of each Director or nominee has been the same for the last
five years, and such person possesses sole voting and investment power with
respect to the shares of Common Stock indicated as beneficially owned by such
person. Messrs. Daniel B. Fitzpatrick, James K. Fitzpatrick and Gerald O.
Fitzpatrick are brothers. There is no family relationship between any other of
the Directors or executive officers of the Company.

Shares
Beneficially
Owned on
Principal Director November 25, Percent
Name Age Occupation Since 1998 of Class
- -------------------------- -------- --------------------------------------------- -------- -------------------- ----------

NOMINEE FOR DIRECTOR
(Nominee for three-year term to expire at the annual meeting of shareholders in 2002)

Christopher J. Murphy III 52 President, Chief Executive Officer and 1994 24,137 (1)(2) *
director of 1st Source Corporation (publicly
held diversified bank holding company) (3)

DIRECTORS CONTINUING IN OFFICE

(Term expiring at annual meeting of shareholders in 2000)

Arthur J. Decio 68 Chairman of the Board and Director of 1994 13,000(1) *
Skyline Corporation (publicly held
manufacturer of manufactured housing
and recreational vehicles) (4)

Daniel B. Fitzpatrick 41 Chairman of the Board, President and 1990 2,391,755(5)(6) 18.8%
Chief Executive Officer of the
Company (7)

(Term expiring at annual meeting of shareholders in 2001)

James K. Fitzpatrick 43 Senior Vice President and Chief 1990 350,756(5)(8) 2.8%
Development Officer of the Company

Ezra H. Friedlander 57 Judge, Indiana Court of Appeals (9) 1995 505,131(10)(11) 3.9%

Steven M. Lewis 49 President, Chief Executive Officer 1994 13,250(1)(12) *
and director of U.S. Restaurants,
Inc. (restaurant management company)
(13)

______________

* Less than 1%.

(1) Includes presently exercisable stock options to purchase 10,000 shares,
granted under the Company's Outside Directors Stock Option Plan ("Outside
Directors Plan").

(2) Includes 1,785 shares held by Mr. Murphy's minor children and 1,000 shares
held by certain retirement plans in which Mr. Murphy is a participant. Also
includes 5,000 shares held in a trust over which Mr. Murphy has investment
control.

(3) Mr. Murphy also serves on the Board of Directors of Comair Holdings, Inc.,
an air transportation holding company.

(4) Mr. Decio also serves on the Board of Directors of NIPSCO Industries, Inc.,
a public utility holding company, and as Director Emeritus of St. Joseph
Capital Corporation, a bank holding company.

(5) Does not include shares subject to stock options which are not exercisable
within 60 days.

(6) Includes presently exercisable stock options to purchase 137,746 shares,
granted by the Company.

(7) Mr. Daniel B. Fitzpatrick also serves on the Board of Directors of 1st
Source Corporation, a publicly held diversified bank holding company.

(8) Includes presently exercisable stock options to purchase 40,268 shares,
granted by the Company.

(9) Mr. Friedlander has been a significant shareholder of the Company or certain
of its predecessors since 1982.

(10) Includes presently exercisable stock options to purchase 8,000 shares,
granted under the Company's Outside Directors Plan.

(11) Includes 14,200 shares held in a trust of which Mr. Friedlander is the
trustee with investment control and the income beneficiary and 15,000
shares owned by Mr. Friedlander's spouse.

(12) Includes 500 shares held in a trust for the benefit of Mr. Lewis' minor
children.

(13) Mr. Lewis also serves on the Board of Directors of Commerce Bancorp, Inc.,
a bank holding company.

The Board of Directors recommends a vote FOR the nominee listed above.

Meetings and Committees

During fiscal 1998, the Board of Directors of the Company held five
meetings. During the period in fiscal 1998 for which he served as a Director,
each of the Company's Directors attended at least 75% of the meetings of the
Board of Directors and each committee on which he served. The Board of Directors
does not have a nominating committee.

The Company has an Executive Committee, an Audit Committee and a
Compensation and Stock Option Committee (the "Compensation Committee"). The
Executive Committee consists of Messrs. Daniel B. Fitzpatrick, Steven M. Lewis
and Christopher J. Murphy III. The Audit Committee consists of Messrs. Murphy
(Chairman), Decio and Lewis. The Compensation Committee consists of Messrs.
Lewis (Chairman), Decio and Murphy. The Executive Committee has authority to act
on behalf of the Board of Directors between meetings and, with certain
exceptions, the authority to take all actions that the full Board could take.
The Audit Committee is responsible for recommending independent auditors,
reviewing with the independent auditors the scope and results of the audit
engagement, establishing and monitoring the Company's financial policies and
control procedures, reviewing and monitoring the provision of non-audit services
by the Company's auditors and reviewing all potential conflict of interest
situations. See "Certain Transactions." The Compensation Committee is
responsible for reviewing, determining and establishing the salaries, bonuses
and other compensation of the executive officers of the Company and for
administering the 1993 Stock Option and Incentive Plan ("1993 Stock Option
Plan") and the 1997 Stock Option and Incentive Plan ("1997 Stock Option Plan").

During fiscal 1998, the Audit Committee and the Compensation Committee each
held five meetings and the Executive Committee did not meet.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and Directors, and persons who own more than 10% of Common
Stock, to file reports of ownership with the Securities and Exchange Commission.
Such persons also are required to furnish the Company with copies of all Section
16(a) forms they file.

Based solely on its review of copies of such forms received by it, or
written representations from certain reporting persons that no Forms 5 were
required for those persons, the Company believes that during fiscal 1998, all
filing requirements applicable to its executive officers, Directors and greater
than 10% shareholders were complied with, except that John C. Firth, James K.
Fitzpatrick, William R. Schonsheck, Gerald O. Fitzpatrick, Scott C. Smith, David
M. Findlay, Marti'n L. Miranda, Michael J. Wargo, Arthur J. Decio, Ezra H.
Friedlander, Steven M. Lewis and Christopher J. Murphy III failed to timely file
Form 5's to report stock options that were granted in fiscal 1998, Patrick J.
Barry failed to timely file a Form 3, Ezra H. Friedlander failed to timely
report three other transactions and William R. Schonsheck failed to timely
report one other transaction.

Executive Officers

As used throughout this Proxy Statement, the term "executive officers"
refers to Daniel B. Fitzpatrick, Chairman, President and Chief Executive
Officer; John C. Firth, Executive Vice President, General Counsel and Secretary;
James K. Fitzpatrick, Senior Vice President and Chief Development Officer;
William R. Schonsheck, Senior Vice President, Chief Operating Officer of Burger
King Division; Gerald O. Fitzpatrick, Senior Vice President, Burger King
Division; Scott C. Smith, Senior Vice President, Full Service Dining Division;
David M. Findlay, Senior Vice President, Finance and Treasurer; Patrick J.
Barry, Senior Vice President, Administration and Information Technology; Robert
C. Hudson, Vice President, Grady's American Grill Division; Marti'n L. Miranda,
Vice President, Controller and Assistant Secretary; and Michael J. Wargo, Vice
President, Director of Human Resources.

Legal Proceedings

James T. Bies filed a shareholder derivative action in the United States
District Court for the Southern District of Michigan on October 14, 1997. The
complaint named as defendants 12 individuals who are current or former directors
or officers of the Company. The complaint alleged that the individual
defendants as directors breached fiduciary duties to the Company by approving
certain transactions in 1997 involving loans to Bagel Acquisition Corporation
that allegedly benefited Daniel B. Fitzpatrick, the Company's Chairman,
President and Chief Executive Officer. The plaintiff also alleged that
individual defendants participated in a "conspiracy to waste, dissipate, and
improperly use funds, property and assets" of the Company for the benefit of
Bagel Acquisition Corporation and Mr. Fitzpatrick. The plaintiff alleged that
the Company and its shareholders had been damaged in an amount in excess of
$28,000,000. The relief sought also included the appointment of a receiver, an
accounting and attorney's fees. On April 27, 1998, the Court dismissed the
complaint without prejudice, for failure to make a "demand" upon the Company's
board of directors. By letter dated May 12, 1998, Mr. Bies has demanded that the
Company pursue these claims against the defendants. In accordance with the
Indiana Business Corporation Law, the board of directors has appointed a special
committee to investigate the allegations and determine whether it is in the best
interests of the Company to pursue this matter. The special committee consists
of three of the Company's outside directors, Messrs. Decio, Lewis and Murphy
(named defendants in the action) along with David T. Link, Dean of the Notre
Dame Law

School. Subsequent to the establishment of the special committee, Mr. Bies
refiled his action on July 30, 1998. As a result of its investigation of Mr.
Bies' demand, the special committee has determined that the claims identified by
Mr. Bies are without merit and that it would not be in the Company's best
interests to pursue them. Therefore, on January 6, 1999, the special committee
filed a motion to dismiss or alternatively for summary judgment.

The Company and certain of its executive officers are defendants in a class
action lawsuit filed in the United States District Court for the Northern
District of Indiana. The complaint alleges, among other things, that the
defendants violated Section 10(b) and 20(a) of the Securities Exchange Act of
1934, as amended, and Rule 10b-5 thereunder by failing to disclose various
matters in connection with the Company's acquisition, development, financing and
disposition of its bagel-related businesses. The putative class period in such
actions is from June 7, 1996 to May 13, 1997 on which dates the price of the
Company's common stock closed at $34.25 and $6.56, respectively. The plaintiffs
are seeking, among other things, an award of unspecified compensatory damages,
interest, costs and attorney's fees. The Company has filed a motion to dismiss
the complaint which is presently pending before the Court. The Company believes
that it and its executive officers have meritorious defenses to the allegations
and it intends to vigorously defend against the allegations made in the
complaints. However, there can be no assurance that the ultimate outcome of this
or other actions (including other actions under federal or state securities
laws) arising out of the Company's acquisition, development, financing and
disposition of its bagel-related businesses will not have a material adverse
effect on the Company's financial position or results of operations.

In addition to the two matters described above, the Company and certain of
its officers and directors are parties to various other legal proceedings
relating to the Company's purchase, operation and financing of the Company's
bagel-related businesses. These proceedings are described in more detail in the
Company's Annual Report on Form 10-K and its Annual Report to Shareholders, a
copy of which is being furnished to the Company's shareholders herewith. The
Company is indemnifying its officers and directors with respect to all of the
above proceedings.

COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS

Summary Compensation Table

The following table sets forth certain information regarding compensation
paid or accrued during each of the Company's last three fiscal years to the
Company's Chief Executive Officer and each of the Company's four other most
highly compensated executive officers, based on salary and bonus earned during
fiscal 1998 (the "Named Executive Officers").

SUMMARY COMPENSATION TABLE
Long Term Compensation
Annual Compensation Awards
------------------------- ------------------------
Fiscal Securities All Other
Name and Principal Position Year Salary Bonus (1) Underlying Options (2) Compensation
- -------------------------------------------- ---------- ------------ ------------- ------------------------ --------------

Daniel B. Fitzpatrick, Chairman, President 1998 $340,000 $ 0 0 $ 4,773 (3)
and Chief Executive Officer 1997 340,750 0 40,440 1,413 (4)
1996 336,538 200,000 117,550 158 (4)

John C. Firth, Executive Vice President, 1998 $230,328 $ 91,800 20,000 $ 4,905 (5)
General Counsel and Secretary 1997 184,038 50,000 15,000 0
1996 57,211 15,000 20,000 0

James K. Fitzpatrick, Senior Vice 1998 $185,288 $ 92,500 20,000 $ 7,440 (6)
President and Chief Development Officer 1997 170,942 75,000 4,670 1,524 (4)
1996 160,288 50,000 16,500 158 (4)

William R. Schonsheck, Senior Vice 1998 $224,808 $ 53,822 20,000 $203,914 (7)
President, Chief Operating Officer of 1997 198,808 47,500 4,200 200,303 (8)
Burger King Division 1996 169,231 80,000 7,000 200,000 (9)

Gerald O. Fitzpatrick - Senior Vice 1998 $181,346 $ 96,250 20,000 $ 6,056 (10)
President, Burger King Division 1997 155,000 75,000 3,980 1,298 (4)
1996 137,500 68,750 13,310 1,154 (4)

_______________

(1) Represents awards under the Company's bonus plan. To the extent the Company
meets certain financial targets and performance targets established for the
areas of the Company's operations under the supervision of the Named
Executive Officer are met, the officer may receive a discretionary bonus.
For fiscal 1998, fiscal 1997 and fiscal 1996, targeted performance levels
and potential bonus awards were approved by the Compensation Committee.
Bonus awards are accrued in the fiscal year earned, but typically paid in
the following fiscal year.

(2) Options to acquire shares of Common Stock. The Company has never granted
SAR's or restricted stock awards.

(3) Includes Company allocations to its discretionary, non-qualified deferred
compensation plan of $2,158 and Company contributions to its discretionary,
noncontributory profit sharing plan of $2,615. The Company's contributions
to these plans on behalf of participants are determined at the discretion of
the Board of Directors.

(4) Represents Company contributions under its discretionary, noncontributory
profit sharing plan.

(5) Includes Company allocations to its discretionary, non-qualified deferred
compensation plan of $4,480 and life insurance premiums of $425.

(6) Includes Company allocations to its discretionary, non-qualified deferred
compensation plan of $4,269 and Company contributions to its discretionary,
noncontributory profit sharing plan of $3,171.

(7) Of this amount $200,000 represents payments to Mr. Schonsheck pursuant to
his non-competition agreement with the Company. See "--Employment and Non-
Competition Agreements." The remaining $3,914 represents contributions to
the Company's discretionary, noncontributory profit sharing plan.

(8) Of this amount $200,000 represents payments to Mr. Schonsheck pursuant to
his non-competition agreement with the Company. See "--Employment and Non-
Competition Agreements." The remaining $303 represents contributions to the
Company's discretionary, noncontributory profit sharing plan.

(9) This amount represents payments to Mr. Schonsheck pursuant to his non-
competition agreement with the Company. See "--Employment and Non-
Competition Agreements."

(10) Includes Company allocations to its discretionary, non-qualified deferred
compensation plan of $2,554 and Company contributions to its discretionary,
noncontributory profit sharing plan of $3,502.

Employment and Non-Competition Agreements

On August 14, 1995, the Company entered into separate employment and non-
competition agreements with Mr. Schonsheck. Pursuant to the employment
agreement, Mr. Schonsheck is to serve as Chief Operating Officer of the
Company's Burger King Division. The employment agreement has a term of four
years and provides for an initial annual base salary of $160,000, which is
increased by at least $25,000 per year on August 14 of each of 1996, 1997 and
1998. In addition, Mr. Schonsheck is entitled to an annual bonus at least equal
to 25% of his then annual base salary. Pursuant to the non-competition
agreement, Mr. Schonsheck is prohibited from competing with the Company for a
period of four years and is entitled to receive $200,000 per year. In connection
with the execution of the agreements, the Company granted Mr. Schonsheck options
to purchase an aggregate of 60,000 shares of Common Stock at an exercise price
of $18.25 per share. The options are exercisable for a period of 10 years and
vest in fourths on each of the first four anniversaries of the date of the
employment agreement. The Company also agreed to nominate Mr. Schonsheck for
election to the Board of Directors for so long as he remains an executive
officer of the Company, but Mr. Schonsheck has chosen not to stand for
reelection at the 1999 annual meeting of shareholders.

In May of 1996, John C. Firth entered into a letter agreement with the
Company in connection with his appointment as Senior Vice President, General
Counsel and Secretary of the Company pursuant to which the Company has agreed to
pay Mr. Firth an annual base salary of $175,000, $200,000 and $225,000 for each
of the first three years of his employment, respectively. In addition, the
Company agreed to pay him minimum annual bonuses of $50,000 and $25,000,
respectively, in each of his first two years of employment. The Company also
agreed to maintain a life insurance policy on Mr. Firth's life during his
employment in the amount of $750,000. In the event of Mr. Firth's death,
$500,000 of the benefits will be paid to his designated beneficiaries and the
remaining $250,000 will be paid to the Company. Upon commencement of his
employment, the Company also granted Mr. Firth options to

purchase 20,000 shares of the Company's Common Stock at an exercise price of
$32.185, the fair market value of the Company's stock on the date of grant.

Compensation of Directors

During fiscal 1998, the Company paid Directors who are not employees of the
Company an annual retainer of $8,000, plus $500 for each regular Board meeting
attended and $750 for each special Board meeting attended and each committee
meeting attended if the committee met on a day other than a Board meeting. All
Directors receive reimbursement of reasonable out-of-pocket expenses incurred in
connection with meetings of the Board. No Director who is an officer or
employee of the Company receives compensation for services rendered as a
Director.

In addition, under the Company's Outside Directors Plan, on May 1 of each
year, each then non-employee Director of the Company automatically receives an
option to purchase 2,000 shares of Common Stock with an exercise price equal to
the fair market value of the Common Stock on the date of grant. Each option
will have a term of 10 years and will be exercisable six months after the date
of grant. On May 1, 1998, each of Messrs. Decio, Friedlander, Lewis and Murphy
received an option to purchase 2,000 shares of Common Stock at an exercise price
of $4.28 per share.

Stock Options

On December 17, 1993, the Directors and shareholders of the Company adopted
the 1993 Stock Option Plan. The 1993 Stock Option Plan provides for awards of
incentive and non-qualified stock options and shares of restricted stock to the
officers and key employees of the Company. An aggregate of 1,000,000 shares of
Common Stock are subject to the 1993 Stock Option Plan (subject to adjustment in
certain events). As of October 25, 1998, options to purchase 594,440 shares of
Common Stock were outstanding under the 1993 Stock Option Plan. No awards for
additional shares of Common Stock will be made under the 1993 Stock Option Plan,
although the terms of options granted pursuant to the 1993 Stock Option Plan may
be modified.

On February 14, 1997, the Board of Directors adopted, subject to
shareholder approval, the 1997 Stock Option Plan. On March 26, 1997, the
shareholders of the Company approved the adoption of the 1997 Stock Option Plan
at the 1997 annual meeting of shareholders. The 1997 Stock Option Plan provides
for awards of incentive and non-qualified stock options, shares of restricted
stock, SAR's and performance stock to the officers and key employees of the
Company. An aggregate of 1,100,000 shares of Common Stock are subject to the
1997 Stock Option Plan (subject to adjustment in certain events). As of October
25, 1998 options to purchase 472,560 shares of Common Stock were outstanding
under the 1997 Stock Option Plan.

The Company's Board of Directors and shareholders approved the Outside
Directors Plan effective December 17, 1993. The Company's Outside Directors
Plan reserves for issuance 40,000 shares of the Company's Common Stock (subject
to adjustment for subsequent stock splits, stock dividends and certain other
changes in the Common Stock) pursuant to non-qualified stock options to be
granted to non-employee Directors of the Company. As of October 25, 1998,
options to purchase 38,000 shares of Common Stock were outstanding under the
Outside Directors Plan. See "--Compensation of Directors."

No option granted under the Outside Directors Plan may be exercised less
than six months or more than 10 years from the date it is granted. In addition,
no option may be exercised unless the grantee has served continuously on the
Board of Directors at all times beginning on the date of grant and ending on the
date of exercise of the option. Nevertheless, all options held by a grantee who
ceases to be a non-employee Director due to death, permanent disability or
retirement with the consent of the Board may be exercised, to the extent they
were exercisable at the date of cessation, at any time within one year after the
date of cessation. Options held by a deceased grantee may be exercised by the
grantee's estate or heirs. If a grantee ceases to be a non-employee Director for
any other reason, such grantee's options will expire three months after
cessation.

The following table sets forth information with respect to options granted
by the Company under the 1997 Stock Option Plan to the Named Executive Officers
during fiscal 1998.

OPTION GRANTS IN LAST FISCAL YEAR

Individual Grants
-----------------------------------------------------------------------
% of Total Potential Realizable Value at
Options Assumed Annual Rates of Stock
Number of Securities Granted to Exercise or Price Appreciation
Underlying Options Employees in Base Expiration for Option (1)
Name Granted Fiscal Year Price Date 5% 10%
- ----------------------------------------------------------------------------------------------------------------------------------

Daniel B. Fitzpatrick 0 0% - - - -
James K. Fitzpatrick 20,000 (2) 3.8% $3.4375 12/14/07 $43,237 $109,570
William R. Schonsheck 20,000 (2) 3.8% $3.4375 12/14/07 $43,237 $109,570
John C. Firth 20,000 (3) 3.8% $3.4375 12/14/07 $43,237 $109,570
Gerald O. Fitzpatrick 20,000 (2) 3.8% $3.4375 12/14/07 $43,237 $109,570

_______________

(1) The dollar amounts under these columns are the result of calculations at the
5% and 10% rates set by the Securities and Exchange Commission and,
therefore, are not intended to forecast possible future appreciation, if
any, of the Company's stock price. The Company did not use an alternative
formula for a grant date valuation, as the Company is not aware of any
formula which will determine with reasonable accuracy a present value based
on future unknown or volatile factors.

(2) Consists of incentive stock options and non-qualified stock options, all of
which were granted at 100% of the fair market value of the stock on the date
of grant. The options are exercisable 25% on December 15, 1998, 25% on
December 15, 1999 and 50% on December 15, 2000.

(3) Consists of non-qualified stock options, all of which were granted at 100%
of the fair market value of the stock on the date of grant. The options are
exercisable 25% on December 15, 1998, 25% on December 15, 1999 and 50% on
December 15, 2000.

The following table sets forth information with respect to the exercise of
options by the Named Executive Officers during fiscal 1998.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES

Number of Securities
Underlying Value of Unexercised In-the-
Unexercised Options at Fiscal Money Options at
Year-End Fiscal Year-End (1)
----------------------------- ---------------------------------
Name Shares Acquired Value
on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
- -------------------------- ----------------- ------------ --------------- ------------- --------------- -----------------

Daniel B. Fitzpatrick 0 0 123,248 57,942 - -
John C. Firth 0 0 12,500 42,500 - -
James K. Fitzpatrick 0 0 32,476 27,294 - -
William R. Schonsheck 0 0 51,766 39,434 - -
Gerald O. Fitzpatrick 0 0 29,776 25,944 - -

_______________

(1) The closing price for the Company's Common Stock as reported by the Nasdaq
National Market System on October 23, 1998 was $2.875. The exercise prices
of the options in the table exceeded $2.875 and therefore were not "In the
Money."

401(k) and Deferred Compensation Savings Plan

On October 27, 1986, the Company implemented the Quality Dining, Inc.
Retirement Plan and Trust ("Plan I"). Plan I is designed to provide all of the
Company's employees with a tax-deferred long-term savings vehicle. The Company
provides a matching cash contribution equal to 50% of a participant's
contribution, up to a maximum of 5% of such participant's compensation. Plan I
is a qualified 401(k) plan. Participants in Plan I elect the percentage of pay
they wish to contribute as well as the investment alternatives in which their
contributions are to be invested. Participant's contributions vest immediately
while Company contributions vest 25% annually beginning in the participant's
second year of eligibility since Plan I inception.

On May 18, 1998, the Company implemented the Quality Dining, Inc.
Supplemental Deferred Compensation Plan ("Plan II"). Plan II is a non-qualified
deferred compensation plan. Plan II participants are considered a select group
of management and highly compensated employees according to Department of Labor
guidelines. Since the implementation of Plan II, Plan II participants are no
longer eligible to contribute to Plan I. Plan II participants elect the
percentage of their pay they wish to defer into their Plan II account. They
also elect the percentage of their account to be allocated among various
investment options. The Company makes matching allocations to the Plan II
participants' deferral accounts equal to 50% of a participant's contribution, up
to a maximum of 5% of such participant's compensation. Company allocations vest
25% annually, beginning in the participant's second year of eligibility since
Plan I inception.

Compensation Committee Report On Executive Compensation

The Compensation Committee determines executive compensation and
administers the Company's 1993 Stock Option Plan and the 1997 Stock Option Plan.

The Company's compensation programs are designed to attract, retain and
motivate the finest talent possible for all levels of the organization. In
addition, the programs are designed to treat all employees fairly and to be
cost-effective. To that end, all compensation programs for management,
including those for executive officers, have the following characteristics.

Compensation is based on the individual's level of job responsibility and
level of performance, the performance of the restaurant, division or
concept supervised by such individual and/or the performance of the
Company. Executive officers have a greater portion of their pay based on
Company performance than do other management employees.

Compensation also takes into consideration the value assigned to the job by
the marketplace. To retain a highly skilled management team, the Company
strives to remain competitive with the pay of employers of a similar
stature who compete with the Company for talent.

Through the grant of stock options, the Company offers the opportunity for
equity ownership to executive officers and other key employees.

Consistent with these programs, the compensation of executive officers has
been and will be related in substantial part to Company performance.
Compensation for executive officers consists of salary, bonus and stock option
grants. Both bonuses and stock option grants are based in part on Company
performance.

Stock Options

Stock options and equity ownership in the Company provide a direct link
between executive compensation and shareholder value. Stock options also create
an incentive to remain with the Company for the long term since the options are
not immediately exercisable. In addition, pursuant to the 1993 Stock Option
Plan, unexercised options are forfeited immediately if the employee leaves
voluntarily (for any reason other than death, disability or retirement) or is
terminated for cause, and are forfeited within three months if employment is
terminated before retirement for any reason other than death or disability;
pursuant to the 1997 Stock Option Plan, unexercised options terminate
immediately if employment is terminated for cause or voluntarily by the employee
for any reason other than death, disability or retirement.

Stock options are granted pursuant to the Company's 1997 Stock Option Plan
at the discretion of the Company's Compensation Committee. It has been the
Compensation Committee's practice to grant options on an annual basis at the
conclusion of the Company's fiscal year. In determining the number of options
to be granted to the Company's employees, the Compensation Committee relies in
large part on the recommendation of the Company's Chairman and Chief Executive
Officer, which recommendation is made in the context of guidelines established
by the Compensation Committee. Following the conclusion of fiscal 1997, the
Compensation Committee suspended its past practice of relying on a formulaic
approach of granting options in order to give greater emphasis on the
individual's potential for future responsibility and promotion over the option
term. The Compensation Committee has established guidelines that provide for
various levels of option grants to classes of employees based upon the level of
responsibility within the Company. However, the Compensation Committee does not
adhere strictly to the guidelines and may occasionally vary the size of the
option grant made to particular individuals. The Compensation Committee did not
grant any options at the conclusion of fiscal 1998.

Cash Bonuses

In December 1994, the Compensation Committee adopted guidelines for annual
cash bonus awards, which guidelines are used by the Company's Chairman and Chief
Executive Officer in his recommendations to the Compensation Committee regarding
the annual bonus awards. Under the bonus program adopted by the Compensation
Committee, executive officers are eligible for an annual bonus in an amount up
to a specified percentage of the executive officer's salary. These percentages
currently range from 25% to 50%. Within these parameters, the bonuses are at
the discretion of the Compensation Committee.

In making bonus recommendations to the Compensation Committee for the 1998
fiscal year, the Chief Executive Officer evaluated each bonus-eligible
employee's performance against targets established for the areas of the
Company's operations under their supervision, the Company's performance against
its financial targets and the executive officer's impact on the Company's
performance over a number of years. In setting bonuses for fiscal 1998, the
Compensation Committee considered the recommendations of the Chief Executive
Officer.

CEO Compensation

Daniel B. Fitzpatrick's salary and cash bonus for fiscal 1998 were
generally determined in accordance with the same procedures and standards as for
the other executive officers of the Company. Mr. Fitzpatrick did not receive any
cash bonus or stock options for fiscal 1998.

Compensation and Stock Option Committee
---------------------------------------

Steven M. Lewis, Chairman
Arthur J. Decio
Christopher J. Murphy III

Performance Graph

The performance graph set forth below compares the cumulative total
shareholder return on the Company's Common Stock with the Nasdaq Market Index
and an Index of Nasdaq Companies in SIC Major Group 58 for the period from March
2, 1994 through October 25, 1998. The Company's Common Stock commenced trading
on the Nasdaq National Market System on March 2, 1994.

Comparison of Cumulative Total Return Among The Company,
Nasdaq Market Index and Index of Nasdaq Companies in SIC Major Group 58

[Performance Graph Appears Here]

Label A B C
Label Quality Dining Eating & Drinking Places NASDAQ Market Index
- -------------------------------------------------------------------------------------------

1 3/2/94 100 100 100
- -------------------------------------------------------------------------------------------
2 10/28/94 108.25 89.38 101.09
- -------------------------------------------------------------------------------------------
3 10/27/95 159.79 108.16 119.91
- -------------------------------------------------------------------------------------------
4 10/25/96 181.44 118.92 140.82
- -------------------------------------------------------------------------------------------
5 10/24/97 39.69 125.05 184.55
- -------------------------------------------------------------------------------------------
6 10/23/98 20.88 152.59 208.68
- -------------------------------------------------------------------------------------------

Notwithstanding anything to the contrary set forth in any of the Company's
previous filings under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, that may incorporate future filings (including
this Proxy Statement, in whole or in part), the preceding Compensation Committee
Report on Executive Compensation and the stock price Performance Graph shall not
be incorporated by reference in any such filings.

Compensation Committee Interlocks and Insider Participation

On March 8, 1994, the Board of Directors established the Compensation
Committee to approve compensation and stock option grants for the Company's
executive officers. The Compensation Committee members are Messrs. Decio, Lewis
and Murphy. Except for Mr. Murphy, none of the Compensation Committee members
are involved in a relationship requiring disclosure as an interlocking executive
officer/director or under Item 404 of Regulation S-K or as a former officer or
employee of the Company. Mr. Murphy is the President of 1st Source Corporation,
a multi-bank diversified financial services corporation. Daniel B. Fitzpatrick
is a director of 1st Source Corporation. Mr. Murphy is not involved in any
relationships requiring disclosure under Item 404 of Regulation S-K. See
"Certain Transactions."

CERTAIN TRANSACTIONS

Related party transactions are subject to the review and approval of the
Company's Audit Committee, which is composed exclusively of the Company's
disinterested Directors.

Leases of Headquarters Building and Restaurant Facilities

In February 1997, the Company moved into a new headquarters facility, which is
leased from a limited liability company in which the Company has a 50% interest.
The Company leases its former headquarters facility from B.K. Main Street
Properties, a partnership owned by Messrs. Daniel B. Fitzpatrick, Ezra H.
Friedlander and James K. Fitzpatrick. The lease is a six-year triple net lease
with monthly rental payments calculated on the basis of $12.00 per square foot
annually. The lease provides for renewals of up to five years at then
prevailing market rates. The Company believes that this lease is on terms at
least as favorable as could be obtained from an unrelated third party. The
Company's former headquarters facility has been subleased to a local financial
institution for a term extending through the expiration of the Company's lease.
During fiscal 1998, the Company paid $116,268 under this lease and received
$78,833 from the sublessee.

Of the Burger King restaurants operated by the Company as of October 25, 1998,
41 were leased from a series of entities owned, in various percentages, by
Messrs. Daniel B. Fitzpatrick, Ezra H. Friedlander and James K. Fitzpatrick (the
"Real Estate Partnerships"). The Company believes that these leases are on
terms at least as favorable as leases that could be obtained from unrelated
third parties. Each of the leases between the Company and a Real Estate
Partnership are triple net leases which provide for an annual base rent equal to
13 1/2% of the total cost (land and building) of the leased restaurant, together
with additional rent of 7% of restaurant sales, to the extent that amount
exceeds the base rental. These terms are substantially identical to those which
were offered by Burger King Corporation to its franchisees at the time the
leases were entered into except that Burger King Corporation was generally
charging additional rent of 8 1/2% of restaurant sales. During fiscal 1998, the
Company paid $4,021,851 under these leases.

In connection with the acquisition of the SHONCO Companies, the Company
acquired two Burger King restaurants which it leases from Mr. Schonsheck or
entities controlled by him. Each of the leases is a triple net lease which
provides for an annual base rent, together with additional rent of 8 1/2% of
restaurant sales, to the extent that amount exceeds the base rental. The Company
believes that these

leases are on terms no less favorable to the Company than those that could be
obtained from unaffiliated third parties. During fiscal 1998, the Company paid
$227,147 under these leases.

During fiscal 1998, the Company paid an aggregate of $4,365,266 under these
related party leases. The Company does not presently intend to enter into
additional leases with related parties.

Transportation Services

Burger Management South Bend No. 3, Inc., an Indiana corporation ("SB No.
3"), owned by Messrs. Daniel B. Fitzpatrick, Ezra H. Friedlander and James K.
Fitzpatrick, has provided the service of its King Air turbo-prop aircraft to the
Company. In fiscal 1998, SB No. 3 billed the Company $185,000. The Company
believes that the amounts paid for air services were no greater than amounts
which would have been paid to unrelated third parties for similar services.
Consequently, the Company intends to continue to utilize SB No. 3 to provide air
transportation services. Since January 1, 1996, SB No. 3 has leased two or three
employees from the Company to act as a pilot and co-pilot of the aircraft. SB
No. 3 reimburses the Company for the Company's full cost of such employees.

Administrative Services

The Company provides certain accounting, tax and other administrative
services to the Real Estate Partnerships and SB No. 3 on a fee for services
basis. The aggregate amount of fees paid to the Company for administrative
services by these entities during fiscal 1998 was $14,000. The Company believes
that these fees are no lesser than amounts which would have been charged to
unaffiliated third parties for comparable services.

Other Obligations to the Company

During fiscal 1998, Mr. John Fitzpatrick, the brother of Daniel B.
Fitzpatrick, James K. Fitzpatrick and Gerald O. Fitzpatrick, purchased items for
Burger King restaurants that he operates through the Company's discount
arrangements with suppliers to the Burger King system. The largest aggregate
amount due from Mr. John Fitzpatrick to the Company during the 1998 fiscal year
was $255,919. As of May 10, 1998, the Company no longer makes its discount
arrangements available to Mr. John Fitzpatrick and he has not since been
indebted to the Company for any amounts.

APPOINTMENT OF AUDITORS

The appointment of PricewaterhouseCoopers LLP as auditors for the Company
during 1999 will be submitted to the meeting in order to permit the shareholders
to express their approval or disapproval. In the event of a negative vote, a
selection of other auditors will be made by the Board. A representative of
PricewaterhouseCoopers LLP is expected to be present at the meeting, will be
given an opportunity to make a statement if he desires and will respond to
appropriate questions. Notwithstanding approval by the shareholders, the Board
of Directors reserves the right to replace the auditors at any time upon the
recommendation of the Audit Committee of the Board of Directors.

The Board of Directors recommends a vote FOR the appointment of
PricewaterhouseCoopers LLP.

PRINCIPAL OWNERS OF COMMON STOCK

The following table sets forth, as of November 25, 1998, the number of
shares of Common Stock of the Company owned by any person (including any group)
known by management to beneficially own more than 5% of the Common Stock of the
Company, by each of the Named Executive Officers, and by all Directors and
executive officers of the Company as a group. Unless otherwise indicated in a
footnote, each individual or group possesses sole voting and investment power
with respect to the shares indicated as beneficially owned.

Name and Address of Number of Shares Percent
Individual or Beneficially of
Identity of Group Owned Class
- ------------------- -------------------- --------

Daniel B. Fitzpatrick (1) 2,391,755 (2)(3) 18.8%

John C. Firth 27,202 (2)(4) *

Gerald O. Fitzpatrick 234,872 (2)(5) 1.9%

James K. Fitzpatrick 350,756 (2)(6) 2.8%

William R. Schonsheck 432,050 (2)(7) 3.4%

Jerome L. Schostak
Robert I. Schostak
David W. Schostak
Mark S. Schostak
NBO, LLC
25800 Northwestern Highway
Southfield, MI 48075 ** 1,132,000 (8) 9.0%

All current Directors and executive
officers as a group (15 persons) 4,100,184 (2)(9) 31.5%

_______________
* Less than 1%.

** Information is based solely on reports filed by such shareholders under
Section 13(d) of the Securities Exchange Act of 1934.

(1) The address of this shareholder is 4220 Edison Lakes Parkway, Mishawaka,
Indiana 46545.

(2) Does not include shares subject to stock options which are not exercisable
within 60 days.

(3) Includes presently exercisable stock options to purchase 137,746 shares,
granted by the Company.

(4) Includes presently exercisable stock options to purchase 21,250 shares,
granted by the Company.

(5) Includes presently exercisable stock options to purchase 37,225 shares,
granted by the Company.

(6) Includes presently exercisable stock options to purchase 40,268 shares,
granted by the Company.

(7) Includes presently exercisable stock options to purchase 57,816 shares,
granted by the Company. Also includes 25,000 shares owned by Mr.
Schonsheck's spouse.

(8) The individuals listed are members of NBO, LLC, a Michigan limited liability
company. The reporting persons share voting and dispositive power with
respect to all 1,132,000 shares reported.

(9) Includes presently exercisable stock options to purchase 434,556 shares
granted by the Company.

SHAREHOLDER PROPOSALS FOR 2000 ANNUAL MEETING

The date by which shareholder proposals must be received by the Company for
inclusion in proxy materials relating to the 2000 Annual Meeting of Shareholders
is October 8, 1999. If a shareholder intends to submit a proposal at the 2000
Annual Meeting of Shareholders which is not eligible for inclusion in the proxy
materials relating to that meeting, the shareholder must do so no later than
December 22, 1999. If such shareholder fails to comply with the foregoing notice
provision, the proxy holders will be allowed to use their discretionary voting
authority when and if the proposal is raised at the 2000 Annual Meeting of
Shareholders.

QUALITY DINING, INC.

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

I hereby appoint Daniel B. Fitzpatrick and John C. Firth, or either of them, my
proxies, with power of substitution, to vote all shares of common stock of the
Company which I am entitled to vote at the Annual Meeting of shareholders of the
Company, to be held at the Company's headquarters, 4220 Edison Lakes Parkway,
Mishawaka, Indiana, on Tuesday, March 9, 1999 at 10:00 a.m., Mishawaka time, and
at any adjournment, as follows:

(change of address)

-----------------------------------------

(If you have written in the above space,
please mark the corresponding box on the
reverse side of this card.)

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR THE ELECTION AS DIRECTOR OF THE NOMINEE LISTED UNDER PROPOSAL 1 AND FOR
PROPOSAL 2.

SEE REVERSE SIDE.

[X] Please mark your
votes as in this
example.

1. Election of Directors Nominee: Christopher J. Murphy III

FOR the nominee WITHHOLD Change
listed to the right AUTHORITY of
to vote for the nominee Address
listed to the right
[_] [_]

2. Approve Appointment of PricewaterhouseCoopers
LLP as Auditors for fiscal 1999

FOR AGAINST ABSTAIN
[_] [_] [_]

3. In their discretion, on any other
matters that may properly come
before the meeting.

Please sign exactly as your name appears
hereon. When shares are held by two or
more persons, all of them should sign.
When signing as attorney, executor,
administrator, trustee or guardian,
please give full title as such. If a
corporation, please sign in full
corporate name by President or other
authorized officer. If a partnership,
please sign in partnership name by
authorized person.

Date
------------------------------------

----------------------------------------
(SIGNATURE)

---------------------------------------
(SIGNATURE IF HELD JOINTLY)

Please mark, sign, date and return the
proxy card using the enclosed envelope.