8-K

               SECURITIES AND EXCHANGE COMMISSION

                     WASHINGTON, D.C.  20549

                            FORM 8-K

                         CURRENT REPORT

               Pursuant to Section 13 or 15(d) of
               the Securities Exchange Act of 1934

        Date of Report                 AUGUST 5, 1998
(Date of earliest event reported)

               FIRST MID-ILLINOIS BANCSHARES, INC.
      (Exact name of Registrant as specified in its charter)

                            DELAWARE
          (State or other jurisdiction of incorporation)

       0-13368                                37-1103704
(Commission File Number)         (I.R.S. Employer Identification Number)

            1515 CHARLESTON AVENUE, MATTOON, ILLINOIS   61938
            (Address of principal executive offices)(Zip Code)

                             (217) 234-7454
           (Registrant's telephone number, including area code)


ITEM 5.  OTHER EVENTS

     On  August  5,  1998, the Registrant announced through a letter to its
stockholders that its  Board  of Directors has authorized the repurchase of
up to three percent (3%) of the  total  number  of  shares of the Company's
common  stock  outstanding.   For more information regarding  this  matter,
reference  is made to the letter  to  stockholders,  a  copy  of  which  is
attached hereto as Exhibit 99.1.

ITEM 7.  FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS

         EXHIBIT NO.
     
         99.1 Letter to Stockholders, dated August 5, 1998


                            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 hereunto duly authorized.

                                   FIRST MID-ILLINOIS BANCSHARES, INC.

Dated:  August 5, 1998             By:/S/ WILLIAM S. ROWLAND
                                   William S. Rowland
                                   Chief Financial Officer

EX-99

To the Shareholders                                        August 5, 1998
First Mid-Illinois Bancshares, Inc.



     We are pleased to announce that the Board of Directors has  approved
the repurchase of up to 3% of the Company's common stock.  The repurchase
program  demonstrates  the Board's confidence in the long-term future  of
the Company as well as its  commitment  to  improve  the overall level of
services  to shareholders.  The shares will be repurchased  at  the  most
recent market  price  of  the  stock.  Shareholders who are interested in
selling their shares to the Company  should  contact Ms. Christie Burich,
Manager of Shareholder Services at 217/258-0493.

     Another noteworthy item to report is the establishment of First Mid-
Illinois Insurance Services, Inc. which recently  began  operations  as a
wholly  owned  subsidiary  of First Mid-Illinois Bank & Trust.  First Mid
Insurance will operate as part  of  the Bank's Trust and Investment Group
under the direction of Bank Executive  Vice  President,  Jack  Kuzcynski.
This area of the Bank offers a wide range of investment advisory,  estate
and   retirement  planning,  retail  brokerage  and  now  life  insurance
services.  Kuczynski noted, "This area of our business is growing rapidly
as our  customers  look  to  the Bank for assistance with their long-term
financial planning.  We are enthusiastic  about  the  opportunity  to add
life  insurance  to  our product mix as it is a natural compliment to the
other services the Group  offers."   Shareholders who have an interest in
these services should contact Jack Kuzcynski at 217/258-0652.



Daniel E. Marvin, Jr.                     William S. Rowland
President and Chief Executive Officer     Executive Vice President and
                                          Chief Financial Officer