UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                                
                     Washington, DC   20549
                                
                            FORM 8-K
                                
                         CURRENT REPORT
                                
             Pursuant to Section 13 or 15(d) of the
                 Securities Exchange Act of 1934
                                

 Date of Report (Date of earliest event reported) June 29, 1998


                          CILCORP Inc.
     (Exact name of registrant as specified in its charter)
                                
   Illinois                     1-8946              37-1169387
(State or other              (Commission          (IRS Employer
jurisdiction of                File Number)    Identification No.)
incorporation)

      300 Hamilton Blvd., Suite 300, Peoria, Illinois 61602
            (Address of principal executive offices)

Registrant's telephone number, including area code (309) 675-8810
                                

Item 5.  Other Events

CILCORP Inc. announced on June 29 that QST Energy Trading Inc., a
subsidiary of the Company, expects to incur a total of between $6
million and $8 million in after-tax losses relating to wholesale
electricity contracts.  These losses were triggered by the
unprecedented run-up in wholesale electricity prices during the
week of June 22. The losses will affect reported results of
operations in the second quarter and, depending on accounting
treatment, the third quarter of 1998.

In view of the recent extreme and unprecedented volatility in
electricity supply and pricing, QST has decided to close its
short trading positions for the remainder of the summer to avoid
exposure to further adverse price movements.

CILCORP also disclosed that it is re-evaluating its unregulated
energy sales and marketing strategy in light of the uncertainties
related to energy deregulation, and the immaturity and
illiquidity of energy markets.  The Company believes it has
viable and attractive opportunities for profitable growth in
Illinois where it has an established base of customers and high-
quality electricity and natural gas assets.


SIGNATURES

Pursuant to the requirements of the Securities Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.




                                                  CILCORP Inc.
                                                  (Registrant)
                                                  

Date June 29, 1998
                                                  J. G. Sahn
                                                  J. G. Sahn
                                       Vice President, General Counsel
                                           and Corporate Secretary



Date June 29, 1998                               M. D. Austin               
                                                 M. D. Austin
                                                  Treasurer