UNITED STATES
                     SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C.  20549


                             FORM 10-Q/A NO. 2

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

            QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                    THE SECURITIES EXCHANGE ACT OF 1934

                FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1998

                      Commission File Number 333-18723


                         MAXXAM GROUP HOLDINGS INC.
           (Exact name of Registrant as specified in its charter)



           DELAWARE                          76-0518669
 (State or other jurisdiction             (I.R.S. Employer
      of incorporation or              Identification Number)
         organization)


  5847 SAN FELIPE, SUITE 2600                   77057
        HOUSTON, TEXAS                       (Zip Code)
     (Address of Principal
      Executive Offices)


     Registrant's telephone number, including area code: (713) 975-7600


     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 /  /

   Number of shares of common stock outstanding at July 31, 1998:  1,000

Registrant meets the conditions set forth in General Instruction H(1)(a)
and (b) of Form 10-Q and is therefore filing this Form with the reduced
disclosure format.



                        PART II.  OTHER INFORMATION

ITEM 6.        EXHIBITS AND REPORTS ON FORM 8-K

A.        EXHIBITS:

     4.1       Indenture between Scotia LLC and State Street Bank and Trust
               Company ("State Street"), as Trustee, regarding the Timber
               Notes (incorporated herein by reference to Exhibit 4.1 to
               the Amended Quarterly Report on Form 10-Q/A of MAXXAM for
               the quarter ended June 30, 1998, File No. 1-3924)

     4.2       Deed of Trust, Security Agreement, Financing Statement,
               Fixture Filing and Assignment of Proceeds among Scotia LLC,
               Fidelity National Title Insurance Company, as Trustee, and
               State Street, as Collateral Agent (incorporated herein by
               reference to Exhibit 4.2 to the Quarterly Report on Form 
               10-Q of MAXXAM for the quarter ended June 30, 1998; the
               "MAXXAM June 30, 1998 10-Q")

     4.3       Credit Agreement among Scotia LLC, Bank of America National
               Trust and Savings Association and other financial
               institutions party thereto (incorporated herein by reference
               to Exhibit 4.3 to the MAXXAM June 30, 1998 10-Q)

   **4.4       First Supplemental Indenture dated as of July 8, 1998, 
               to the Indenture dated as of December 23, 1996, between 
               the Company and U.S. Bank Trust National Association, as 
               Trustee

   **4.5       Second Supplemental Indenture dated as of July 29, 1998, 
               to the Indenture dated as of December 23, 1996, between the
               Company and  U.S. Bank Trust National Association, as
               Trustee

     *10.1     New Master Purchase Agreement between Pacific Lumber and
               Scotia LLC

     *10.2     New Services Agreement between Pacific Lumber and Scotia LLC
              

     *10.3     New Additional Services Agreement between Pacific Lumber and
               Scotia LLC

     *10.4     New Reciprocal Rights Agreement among Pacific Lumber, Scotia
               LLC and Salmon Creek

     *10.5     New Environmental Indemnification Agreement between Pacific
               Lumber and Scotia LLC

     *27       Financial Data Schedule

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*     Previously filed as an exhibit to the Company's Quarterly Report on
      Form 10-Q dated July 31, 1998; File No. 333-18723

**    Previously filed as an exhibit to the Company's Amended Quarterly
      Report on Form 10-Q/A dated August 10, 1998; File No. 333-18723

  
B.        REPORTS ON FORM 8-K:

          None.


                                 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, who has signed this report on
behalf of the Registrant and as the principal accounting officer of the
Registrant.


                                  MAXXAM GROUP HOLDINGS INC.




Date:  September 14, 1998        By:  /S/ BERNARD L. BIRKEL       
                                          Bernard L. Birkel
                                             Secretary

Date:  September 14, 1998        By:  /S/ ELIZABETH D. BRUMLEY     
                                        Elizabeth D. Brumley
                                        Assistant Controller
                                   (Principal Accounting Officer)