11-K

SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549

FORM 11-K

(X) ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended December 31, 1995
OR
TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from
to

Commission file number 1-9779

NIPSCO INDUSTRIES, INC.
EMPLOYEE STOCK PURCHASE PLAN
(Full title of plan)

NIPSCO INDUSTRIES, INC.
(Issuer of the Securities)

5265 Hohman Avenue, Hammond, Indiana 46320-1775
(Address of Principal Executive Office)


REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Plan Administrator of the NIPSCO Industries, Inc.
  Employee Stock Purchase Plan:

We have audited the accompanying balance sheet of the NIPSCO Industries,
Inc. Employee Stock Purchase Plan as of December 31, 1995 and 1994, and the
related statements of income and changes in plan equity for each of the
three years in the period ended December 31, 1995.  These financial
statements are the responsibility of the plan administrator.  Our
responsibility is to express an opinion on these financial statements based
on our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation.  We believe that our audits
provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of the NIPSCO Industries,
Inc. Employee Stock Purchase Plan as of December 31, 1995 and 1994, and the
income and changes in plan equity for each of the three years in the period
ended December 31, 1995, in conformity with generally accepted accounting
principles.

/s/ Arthur Andersen LLP

Chicago, Illinois
March 11, 1996       





NIPSCO Industries, Inc.
Employee Stock Purchase Plan
Balance Sheet
                                                         December 31,
                                                  _______________________
                                                     1995         1994
                                                  ==========   ==========
                                                         
ASSETS
Employee contributions receivable
  (Note 1d and 2b)                                $  273,699   $  281,447
                                                  ==========   ==========

LIABILITIES AND PLAN EQUITY
                                                         
Amounts payable for purchases of
  common shares                                   $  273,699   $  281,447
Plan Equity                                                0            0
                                                  __________   __________

    Total Liabilities and Plan Equity             $  273,699   $  281,447
                                                  ==========   ==========

The accompanying notes to financial statements are an integral part of
these statements.




NIPSCO Industries, Inc.
Employee Stock Purchase Plan
Statements of Income and Changes in Plan Equity

                                             Year Ended December 31,
                                     ____________________________________
                                        1995         1994         1993
                                     ==========   ==========   ==========
                                                      
Plan Equity, Beginning of Year       $        0   $        0   $        0

Increases (Decreases) during
  the year:
    Employee contributions              549,090      552,601      538,321
      (Notes 1d and 2b)
    Employer contributions               60,327       59,916       54,210
      (Note 2b)
    Purchases of common shares         (603,269)    (599,158)    (542,098)
      (Note 1e)
    Refunds to participants             (13,896)     (15,602)     (19,283)
    Change in amounts payable for
      purchases of common shares          7,748        2,243      (31,150)
                                     __________   __________   __________

Plan Equity, End of Year             $        0   $        0   $        0
                                     ==========   ==========   ==========

The accompanying notes to financial statements are an integral part of
these statements.



NIPSCO Industries, Inc.
Employee Stock Purchase Plan
Notes to Financial Statements

(1)  DESCRIPTION OF THE PLAN
The following brief description of the NIPSCO Industries, Inc. (Industries)
Employee Stock Purchase Plan (Plan) is provided for general information
purposes only.  Participants should refer to the Plan agreement for a more
complete description of the Plan's provisions.

(a)  General -
The Plan was established on October 27, 1964, when it was adopted by
Northern Indiana Public Service Company's (Northern Indiana) Board of
Directors and became effective on December 15, 1964.  Effective March 3,
1988, the Plan was assumed by Industries and amended to allow participation
by eligible employees of Industries and certain of its subsidiaries as
designated by the Board of Directors of Industries.  It is designed to
provide a convenient means by which eligible employees may save regularly
through voluntary, systematic payroll deductions and use such savings to
purchase common shares without par value (Common Shares) of Industries, at
less than the market price.

(b)  Plan Administration -
The Controller of Northern Indiana is the administrator of the Plan 
and makes such rulings or interpretations as are necessary in its
operation.  Northern Indiana bears all the costs of administering and
carrying out the Plan.

(c)  Eligibility -
Only employees who have one or more years of service with Industries, or
any participating subsidiary, are eligible to participate in the Plan.  
Full-time and part-time employees whose customary employment is twenty
hours or less per week and five months or less per calendar year, or 
employees whose customary employment is for less than six months in any
calendar year are not eligible to participate.  There were 540, 570 and
610 active participants in the Plan as of December 31, 1995, 1994 and 
1993, respectively.

(d)  Employee Contributions -
Prior to October 23, 1995, an eligible employee could authorize payroll 
deductions in any full dollar amount, not less than $7 per regular pay
period and not more than 10 percent of the employee's regular rate of
pay for a regular pay period.  Effective October 23, 1995, an eligible
employee may authorize payroll deductions in any full dollar amount, not
less than $10 per regular pay period but not more than $20,000 per
calendar year.

An eligible employee may enter the Plan at the beginning of any month
by signing and delivering to NIPSCO Shareholder Services, upon fifteen days
advance notice, an authorization for payroll deductions for the purchase
of Common Shares.  Such authorization must state (a) the amount to be
deducted regularly from each pay check, (b)authority to issue the Common
Shares in each savings period, and (c) the exact name or names in which
the Common Shares are to be issued.  The stock certificates for Common
Shares purchased under the Plan may be issued in the employee's name,
or, if so designated by the employee, in his or her name and the name of
another person of legal age, as joint tenants with the right of survivorship,
or in a trust or custodian arrangement.  Payroll deductions can be changed
only at the beginning of any month upon fifteen days advance notice.

For purposes of the Plan, the savings periods are the periods during which
participants accumulate savings for the purchase of Common Shares under 
the Plan.  Each savings period includes all paydays within that period.
Interest is not paid on payroll deductions while held by the applicable
employer for a participant's account under the Plan.  Prior to October 23,
1995, savings periods were the six month periods from January 1 to June 30
and July 1 to December 31. Effective October 23, 1995, the Plan was amended to
change the savings periods to three month periods from January 1 to March 31;
April 1 to June 30; July 1 to September 30; and October 1 to December 31;
inclusive.

(e)  Purchases of Common Shares -
Prior to October 23, 1995, a participant who purchased Common Shares under
the Plan could purchase as many full shares as was determined by dividing the
amount of accumulated savings for the entire savings period by the purchase
price per share for such savings period.  Effective October 23, 1995, a
participant who purchases Common Shares under the Plan will purchase as many
full or fractional shares as is determined by dividing his or her accumulated
savings for the entire savings period by the purchase price per share
for such savings period.  The purchase price per share to participants is 90%
of the closing market price of Common Shares on the New York Stock Exchange
on the last trading day of the savings period.

(f)  Refunds and Withdrawals -
A participant who does not wish to purchase Common Shares in any savings
period must give written notice to NIPSCO Shareholder Services at least
seven business days prior to the purchase date on which the participant
wishes to terminate.  In such event, all funds credited to the participant
under the Plan will be returned as soon as practicable, and no further
payroll deductions will be made during that savings period.

A participant may withdraw from the Plan at any time upon seven days advance
notice and reenter the Plan at the beginning of any month on fifteen days
advance notice.  Withdrawal shall be made by proper notification to
NIPSCO Shareholder Services.  Funds credited to the account of a participant
not already used or unconditionally committed to the purchase of Common
Shares will be returned to the participant as soon as practicable after
notice of withdrawal is received.  The participant will also receive either
a certificate for all full Common Shares held in his or her account or at
his or her request a check for such Common Shares.  The participant may
also request a check for any fractional share held in his or her account.
The cash value of Common Shares will be the average price on the day of
sale multiplied by the number of shares sold, less fees and commissions.

(g)  Termination of Participation -
Participation in the Plan terminates if the participant's employment is
terminated because of retirement, resignation, discharge, death or any
other reason.  In such event, all funds of the participant under the
Plan not already used or unconditionally committed for the purchase of
Common Shares will be refunded as soon as practicable.  The participant will
receive either a certificate for all full Common Shares held in his or her
account or at his or her request, a check for such Common Shares.  The
participant will also receive a check for the cash and any fractional share
held in his or her account. The cash value of the Common Shares will be the
average price on the day of sale multiplied by the number of shares sold,
less fees and commissions.


(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a)  Method of Accounting -
The financial statements of the Plan have been prepared on the accrual
basis of accounting.

(b)  Contributions -
Employee contributions receivable represents amounts due as of December 31,
1995 and 1994, under the terms of the Plan agreement.  Employer
contributions are reflected as 10% of the purchase price of Common Shares
in the accompanying financial statements when the Common Shares are
purchased.


(3)  INCOME TAX STATUS

The Plan is not qualified under Section 401(a) of the Internal Revenue
Code.  No Federal income tax is imposed when a participant purchases shares
under the Plan.  When a participant sells or otherwise disposes of shares
purchased under the Plan, Federal income tax considerations differ,
depending on the length of time the shares were held.  A participant must
notify his or her employer if any Common Shares purchased under the Plan
are disposed of within two years from the date of grant of the right to
purchase or one year from the date of purchase.  Any dividends received by
a participant must be reported as taxable income.


(4)  TERMINATION OR AMENDMENT OF PLAN

Industries reserves the right to modify, suspend or terminate the Plan,
by action of its Board of Directors as of the beginning of any Savings
Period.  Notice of suspension, modification or termination will be given
to all participants.  Upon termination of the Plan for any reason, the
cash then credited to the participant's account, if any, a certificate
for all full Common Shares held in the participant's Plan Account and
the cash value of any fractional share shall be distributed promptly to
the participant.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Controller of Northern Indiana Public Service Company, who administers the
Plan, has duly caused this annual report to be signed on its behalf by the
undersigned thereunto duly authorized.


NIPSCO INDUSTRIES, INC.
EMPLOYEE STOCK PURCHASE PLAN
(Name of Plan)

BY:     /s/ Arthur A. Paquin
        Controller
        Northern Indiana Public Service Company

Date:   March 26, 1996

EX-23

Exhibit 23

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the incorporation of
our report included in this Form 11-K, into NIPSCO Industries, Inc.'s
previously filed Form S-8 Registration Statement No. 33-30621.

/s/  Arthur Andersen LLP

Chicago, Illinois
March 26, 1996