This Prospectus Supplement relating to
                                   Registration Statement No. 33-99338
                                   is filed pursuant to Rule 424(b)(3)
                                   under the Securities Act of 1933.



    FIRST SUPPLEMENT TO MARCH 25, 1996 PROSPECTUS OF FORWARD INDUSTRIES, INC.


          Forward Industries, Inc. (the "Company") filed its Quarterly Report on
Form 10-QSB for the quarterly period ended March 31, 1996 (the "Quarterly
Report") with the Securities and Exchange Commission on May 15, 1996.  A copy of
the Quarterly Report is being delivered with the Prospectus.  The Quarterly
Report reflected, among other things, the following information:

Results of Operations.  For the three months ended March 31, 1996, the Company
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reported a loss before provision for income tax credits of $595,304 and a net
loss of $377,304 ($.11 per share) on net sales of $4,175,023, as compared with a
loss before provision for income tax credits of $237,844 and a net loss of
$147,444 ($.04 per share) on net sales of $2,911,966 for the comparable 1995
period.  As a result of such losses, the Company's working capital declined from
$367,168 at December 31, 1995 to a deficit of $316,307 at March 31, 1996.  The
Company believes that its operations will return to profitability during the
current fiscal year.  See "Risk Factors - Lack of Profitability in Fiscal Year
Ended September 30, 1995 and in Fiscal Quarter Ended December 31, 1995" at page
7 of the Prospectus. 

Financing Arrangements.  Effective March 30, 1996, the Company's borrowing
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arrangements with 1st Source Bank, South Bend, Indiana, were extended to August
15, 1996.  In connection with such extension, the rate of interest on
outstanding borrowings was increased from 1% to 1-1/2% over prime.  Although the
Company was not maintaining the financial ratios required under such
arrangements as of March 31, 1996, the Bank has waived compliance with such
ratios through August 15, 1996.  See "Risk Factors - Inadequacy of Cash Flow
from Operations and Credit Lines" at page 7 of the Prospectus.

Deferred Income Taxes.  The Company's balance sheet at March 31, 1996 has
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characterized $1,581,000 of deferred income taxes as an asset, of which $256,000
is characterized as a current asset.  Without such deferred tax assets, the
Company's stockholders' equity at such date of $1,239,177 would have been
reduced to a stockholders' deficit of $341,823 and the Company's working capital
deficit at such date would have been increased from $316,307 to $572,307. See
"Risk Factors - Possible Inability to Realize Benefit of Deferred Income Tax
Assets" at page 8 of the Prospectus.

Exercise of Warrants.  Through May 15, 1996, 1,203,000 shares of Common Stock
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covered by the Prospectus have been issued upon exercise of the Company's
Warrants and the Company has received an aggregate of $1,698,300 upon such
exercises, which funds are being used for working capital. See "Use of Proceeds"
at page 11 of the Prospectus and "Description of Securities" at page 35 of the
Prospectus.



Dated: May 17, 1996