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                   SECURITIES AND EXCHANGE COMMISSION
                        Washington, D. C. 20549
                             FORM 10-Q
(Mark One)


x     Quarterly report pursuant to Section 13 or 15(d) of the
      Securities Exchange Act of 1934 for the quarterly period
      ended March 24, 1996.

      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   0-12919

                              PIZZA INN, INC.
                  (Exact name of registrant in its charter)



         Missouri                         47-0654575
 (State or other jurisdiction of        (I.R.S. Employer
  incorporation or organization)       Identification No.)


                           5050 Quorum Drive
                               Suite 500               
                          Dallas, Texas 75240
                (Address of principal executive offices,
                          including zip code)

                          (214) 701-9955
                 (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 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 by check mark whether the registrant has filed all
documents and reports  required to be filed by Sections 12, 13 or
15(d)of the Securities Exchange  Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court.
      Yes x     No

    At March 24, 1996, an aggregate of 13,020,401 shares of the
registrant's Common  Stock, par value of $.01 each (being the
registrant's only class of common stock), were outstanding.



                           PIZZA INN, INC.
                               Index

PART I.    FINANCIAL INFORMATION

Item 1.    Financial Statements                              Page

         Condensed Consolidated Statements of Operations
         for the three months and nine months ended
         March 24, 1996 and March 26, 1995......................3

         Condensed Consolidated Balance Sheets at
         March 24, 1996 and June 25, 1995.......................4

         Condensed Consolidated Statements of
         Cash Flows for the nine months ended
         March 24, 1996 and March 26, 1995......................5

         Notes to Condensed Consolidated Financial
         Statements.............................................6

Item 2.  Management's Discussion and Analysis of
         Financial Condition and Results of Operations..........7

PART II.   OTHER INFORMATION

Item 6.  Exhibits and Reports on Form 8-K......................10

         Signatures............................................11








PART I.    FINANCIAL INFORMATION



Item 1.    Financial Statements




PIZZA INN, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)



                        Three Months Ended         Nine Months Ended
                       March 24,  March 26,        March 24,  March 26,
                         1996      1995             1996        1995
                        -------- --------         --------    --------
                                                   
REVENUES:
  Food and supply
    sales               $13,964    $12,523         $41,746     $38,167
  Franchise revenue       1,836      1,903           5,458       5,326
  Restaurant sales          684        768           2,162       2,376
  Other                      73         49             237         126
                       --------   --------        --------     -------
                         16,557     15,243          49,603      45,995
COSTS AND EXPENSES:
  Cost of sales          12,860     11,896          38,733      36,227
  Franchise expenses        781        727           2,167       2,063
  General and admin-
    istrative expenses    1,328      1,216           3,953       3,735
  Non-recurring gain          -          -               -        (531)
  Interest                  194        309             677       1,016
                       --------   --------        --------    --------
                         15,163     14,148          45,530      42,510
INCOME BEFORE INCOME
  TAXES                   1,394      1,095           4,073       3,485
  Provision for income
    taxes                   474        372           1,385       1,185
                       --------   --------        --------    --------
NET INCOME             $    920   $    723         $ 2,688    $ $2,300
                       ========   ========        ========    ========

NET INCOME PER COMMON
  SHARE                $   0.07   $   0.05         $   0.19   $   0.16
                       ========   ========         ========   ========


See accompanying Notes to Condensed Consolidated Financial Statements








PIZZA INN, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)

                               March 24,             June 25,
                                 1996                  1995
                              (Unaudited)
                                --------              --------
                                                
ASSETS

CURRENT ASSETS
  Cash and cash equivalents     $    326              $  1,672
  Restricted cash and short-term
    investments (including $230
    pledged as collateral for
    certain letters of credit)       345                   353
  Notes and accounts receivable,
    less allowance for doubtful
    accounts of $1,170 and $1,119,
    respectively                   5,963                 5,109
  Inventories                      1,845                 1,590
  Prepaid expenses and other         587                   590
  Net assets held for sale           131                   243
                                --------              --------

    Total current assets           9,197                 9,557

PROPERTY, PLANT AND EQUIPMENT,
  net                              1,930                 1,722
PROPERTY UNDER CAPITAL LEASES,
  net                                663                   747

DEFERRED TAXES, net               11,279                12,582

OTHER ASSETS
  Long-term notes and accounts
    receivable, less allowance for
    doubtful accounts of $61
    and $199, respectively           129                   690
  Deposits and other                 495                   505
                                --------              --------
                                $ 23,693              $ 25,803
                                ========              ========

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES
  Current portion of
    long-term debt              $  2,000              $  1,995
  Current portion of
    capital lease obligations         66                    71
  Accounts payable - trade         1,648                 1,184
  Accrued expenses                 3,431                 2,808
                                --------              --------
    Total current liabilities      7,145                 6,058

LONG-TERM LIABILITIES
  Long-term debt                   7,410                10,393
  Long-term capital lease
    obligations                      589                   646
  Other long-term liabilities        783                 1,304

SHAREHOLDERS' EQUITY
  Common Stock, $.01 par value;
    authorized 26,000,000 shares;
    outstanding 13,020,401 and
    13,526,970 shares,respectively
    (after deducting shares in
    treasury: March 24 - 1,156,967;
    June 25 - 418,898)               130                   135
  Additional paid-in capital       3,598                 3,974
  Retained earnings                4,038                 3,293
                                --------              --------
    Total shareholders' equity     7,766                 7,402
                                --------              --------
                                $ 23,693              $ 25,803
                                ========              ========



See accompanying Notes to Condensed Consolidated Financial Statements




PIZZA INN, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)

                                      Nine Months Ended
                                 March 24,           March 26,
                                   1996                 1995
                                 --------            --------
                                               
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income                     $  2,688          $    2,300
  Add non-cash items                1,742                 943
  Changes in assets and liabilities:
    Accounts and notes receivable    (293)               (393)
    Inventories                      (255)                105
    Accounts payable - trade          464                 121
    Deferred income                   204                (829)
    Other accrued expenses           (114)               (339)
    Other - net                        26                (286)
                                 --------            --------
    Cash provided by
      operating activities       $  4,462             $ 1,622

CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchases of property, plant and
    equipment                        (534)               (829)
  Proceeds from sales of assets        91                 129
                                 --------            --------
  Cash used for investing
    activities                       (443)               (700)

CASH FLOWS FROM FINANCING ACTIVITIES:
  Repayments of long-term debt and
    capital lease obligations      (3,041)             (1,265)
  Proceeds from exercise of stock
    options                           350                 179
  Purchases of treasury stock      (2,674)                (66)
                                 --------            --------
  Cash used for financing
     activities                    (5,365)             (1,152)


Net decrease in cash and cash
  equivalents                      (1,346)               (230)
Cash and cash equivalents,
  beginning of period               1,672               2,924
                                 --------            --------
Cash and cash equivalents, end
  of period                      $    326            $  2,694
                                 ========            ========

SUPPLEMENTARY DISCLOSURES OF CASH FLOW INFORMATION

CASH PAYMENTS FOR:
  Interest                       $    660            $  1,028
  Income taxes                         80                  40

NON-CASH FINANCING AND INVESTING ACTIVITIES:

  Notes received upon sale of area
    development territories             -                 511

See accompanying Notes to Condensed Consolidated Financial Statements




                        PIZZA INN, INC.
   NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                          (Unaudited)


(1)    The accompanying condensed consolidated financial statements
       of Pizza Inn, Inc. (the "Company") have been prepared without
       audit pursuant to the rules and regulations of the Securities
       and Exchange Commission.  Certain information and footnote
       disclosures normally included in the financial statements
       have been condensed or omitted pursuant  to such rules and
       regulations.  The condensed consolidated financial state-
       ments should be read in conjunction with the notes to the
       Company's audited consolidated financial statements in its
       Form 10-K/A for the fiscal year ended June 25, 1995.


       In the opinion of management, the accompanying unaudited
       condensed consolidated  financial  statements contain all
       adjustments  necessary  to fairly present the Company's
       financial position and results of operations for the
       interim periods.  All adjustments contained herein are of
       a normal recurring nature.  Certain prior year amounts
       have been reclassified to conform to current year
       presentation.

(2)    For the three and nine months ended March 24, 1996, common
       stock equivalents were 901,492 and 778,681, respectively,
       and the total weighted average number of shares considered
       to be outstanding were 14,054,717  and 14,079,232,
       respectively.  For the three and nine months ended
       March 26, 1995, common stock equivalents were 325,182 and
       405,619, respectively, and the total weighted average num-
       ber of shares considered to be outstanding were 14,267,081
       and 14,339,616, respectively.

(3)    On June 30, 1995, the Company purchased 262,094 shares of
       its own common stock from a former lender for a cash price
       price $596,285.  In addition, during the nine months ended
       March 24, 1996, the Company purchased 475,400 of its own
       shares in the open market.  The total purchase price for
       these shares was $2,077,493.  These reacquired shares are
       held as treasury stock and will be retired at the earliest
       opportunity.


Item 2.    Management's  Discussion and Analysis  of Financial
Condition and Results of Operations

                            Results of Operations
Quarter and  nine months ended March 24, 1996 compared to the quarter
and nine months ended March 26, 1995.

    Net income for the third quarter of the current fiscal year
increased 27% to $920,000 or $.07 per share, from $723,000 or $0.05
per share for the same quarter last year.  For the nine month period,
net income rose 17% to $2,688,000 or $0.19 per share from $2,300,000
or $0.16 per share last year.  The prior year nine months included a non-
recurring gain of $350,000 net of tax from the resolution of certain 
property and sales tax liabilities.  Excluding the effect of this gain,
net income for the nine month period was up 38% and earnings per share
grew 36% to $0.19 from $0.14.

    Food and supply sales from the Company's distribution division
increased 12% for the quarter and 9% for the nine month period,
compared to the same periods last year.  This was partially the result
of higher domestic chainwide sales, which were up 2% for the quarter
and 3% for the nine month period.  Increased market share on sales of
non-proprietary food ingredients and equipment, as well as increases
in the market price of certain commodities, also contributed to higher
food and supply sales.

    Franchise revenue, which includes income from royalties, franchise
fees and area development sales, decreased 4% for the quarter and
increased 2%  for the nine month period.  Royalties during the quarter
were down 12%, primarily  as  a  result of a one-time adjustment in
the previous  year  to recognize  actual  international royalties in
excess of amounts  previously accrued.  For the nine month period,
royalties were up slightly in the current year, due to higher domestic
chainwide sales and international store openings at higher effective
royalty rates than existing units.  It should also be noted that
during the current quarter, all 39 Pizza Inn units in Korea were
closed.  The Company had previously terminated the license and filed
suit against the Korean Master Licensee to enforce compliance  with
certain contractual obligations and to collect past due receivables.
The Korean units  paid less than  $150,000 per year in royalties.
Franchise fees were down for the quarter and nine month periods
compared  to  the prior year, due to the timing of store openings and
the number  of  stores opening within area development territories.
Increased current  year  openings of Express units, which have a lower
initial  fee, also contributed to the decrease in franchise fees.
Area development sales increased for both current year periods, and
include revenue from the  sale of  area  development  rights for
sections of North Carolina and  South Carolina.

    Other revenue consists primarily of interest income and non-
recurring revenue items.  Revenue from the sale of lease rights on a
non-operating property during  the current quarter and revenue from a
favorable lawsuit settlement  during an earlier quarter of the current
year resulted in  the increase in other revenue for both current year
periods.

    Cost of sales  increased 8% and 7% for the quarter  and  nine
month periods, respectively, as a result of the growth in food and
supply sales to the Company's franchisees.  As a percentage of food
and supply  sales, cost  of  sales is slightly lower during both
current year  periods  as a result  of  cost  efficiencies  achieved
through  fleet  modernization and routing efficiencies, increased
labor productivity,  and  improved buying power through volume
purchasing.

    Franchise expenses increased 7% and 5% for the quarter and nine
month periods due to additional expenditures for franchisee training
and support personnel.

    General  and  administrative expenses increased  9%  and  6%
for the quarter  and  nine  months, respectively.  This was due  primarily
to the implementation  of  a  new computer system, which  resulted  in
additional expenses related to programming and support.

    During  the prior year nine month period, upon settlement  of
certain sales and property  tax  liabilities for amounts  lower  than
previously estimated, the Company recorded a non-recurring gain  of
$531,000.   The after-tax  effect of  this adjustment on prior  year
net income  was  an increase of $350,000 or $.02 per share.

    Interest expense decreased 37% and 33% for the quarter and nine
months, respectively, due to lower debt levels and lower interest
rates.


                   Liquidity and Capital Resources

     Cash  provided by operations totalled $4.5 million for the first
nine months  of  fiscal  1996, and consisted primarily of net income,
plus  the benefit of the Company's  net  operating  loss
carryforwards  which significantly reduced the amount of federal income
tax actually  paid.  The Company used cash of $534,000 during the
first nine months of this year for capital expenditures  to upgrade
the distribution division warehouse  and fleet, and  to  purchase  new
equipment for the company-operated  training stores.  The Company also
used cash to reduce bank debt by making scheduled principal  payments
of  $1.6  million and voluntary prepayments  of  $1.4 million during
the first nine months of the year. Cash was also  used  to purchase
shares of the Company's own common stock.  On June 30, 1995,  the
Company purchased 262,094 shares from a former lender for a cash price
of $596,285.   During the first nine months of fiscal 1996, the
Company  also purchased  475,400 of its shares on the open market for
a  total  price  of $2,077,493.  Management believes that the recent
market price of its common stock makes it an attractive investment for
the Company, and to the extent that these prices prevail, the Company
plans to continue purchasing its own shares while repaying debt.

    During  the  first  quarter  of fiscal 1996,  the  Company  signed
an agreement  for the sale of an area development territory covering
portions of North Carolina and South Carolina to an existing area
developer for a cash price of $1,350,000.   This  area  development agree-
ment, along with other agreements signed  during  the  last  four  years,
contain development commitments for significant unit growth over the
next five years. Related growth in royalties and distribution sales are
expected to provide adequate working capital for future needs.  The
occurrence of any additional  area development sales during the year,
which cannot  be predicted  with  any certainty,  may  also  provide
significant infusions of cash.  External sources of cash are not
expected to be required in the foreseeable future.

    The  Company  continues  to  realize  substantial  benefit
from utilization  of its net operating loss carryforwards to reduce its
federal tax liability from the 34% reflected on its statement of
operations  to an  actual  payment  of  approximately 2% of  taxable
income. Management believes that future operations will generate
sufficient taxable income to fully  realize  the net deferred tax
asset balance of $11.3 million  as of March 24, 1996.  Taxable income
in future years at the same level as fiscal 1995 would  be  sufficient
for full realization  of  the  net  tax asset.  Management  believes
that,  based  on  recent  growth  trends  and future projections,
maintaining current levels of taxable income is achievable and that
the Company will be able to realize its net deferred tax asset without
reliance on material, non-routine income.

    Historically, the differences between pre-tax earnings  for
financial reporting  purposes and taxable income for tax purposes
have  consisted of temporary  differences arising from the timing
of depreciation, deductions for accrued  expenses  and  deferred
revenues,  as  well  as permanent differences  as  a result of
goodwill amortization deducted  for financial reporting purposes
but not for income tax purposes.

    The following summarizes, as of March 24, 1996, the annual amounts
of net operating  loss carryforwards for income tax purposes that
expire by year:
 
 

     Net Operating Loss
        Carryforwards
        (In Thousands)            Expires in Year
     ----------------             --------------
                           
       $  3,700                        2004
         24,600                        2005
        -------
       $ 28,300
        =======




PART II.  OTHER INFORMATION



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

    There are  no exhibits filed with this report.  No reports on Form
8-K were filed in the quarter for which this report is filed.



                                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.


                                   PIZZA INN, INC.
                                   Registrant




                                   By:  /s/C. Jeffrey Rogers
                                        C. Jeffrey Rogers
                                        President and 
                                        Principal Executive Officer 

                                        
                                  By:  /s/Amy E. Manning
                                       Amy E. Manning
                                       Controller and
                                       Principal Accounting Officer






Dated:    May 7, 1996














  


 5
 1000
       
                             
                   9-MOS
                          JUN-30-1996
                             JUN-26-1995
                               MAR-24-1996
                                             326
                                         0
                                     5963
                                      1170
                                       1845
                                  9197
                                            1930
                                       0
                                   23693
                             7145
                                              0
                                0
                                          0
                                           130
                                        7636
                     23693
                                          43908
                                 49603
                                            38733
                                    38733
                                  2167
                                     0
                                 677
                                   4073
                                      1385
                               2688
                                       0
                                      0
                                            0
                                      2688
                                      .19
                                      .19