SCHEDULE 14A
                              (RULE 14a-101)

                  INFORMATION REQUIRED IN PROXY STATEMENT
                         SCHEDULE 14A INFORMATION
        PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
                EXCHANGE ACT OF 1934 (AMENDMENT NO. _____)

Filed by the registrant  [X]
Filed by a Party other than the Registrant     [ ]
Check the appropriate box:
     [ ]  Preliminary Proxy Statement        [ ]  Confidential, For Use of
     [ ]  Definitive Proxy Statement              the Commission Only
                                                  (as permitted by 
     [X]  Definitive Additional Materials         Rule 14a-6(e)(2)
     [ ]  Soliciting Material Pursuant to 
          Rule 14a-11(c) or Rule 14a-12

                         IWERKS ENTERTAINMENT, INC.
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             (Name of Registrant as Specified in Its Charter)

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 (Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):
     [X]  No Fee Required
     [ ]  Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
          and 0-11.

     (1)  Title of each class of securities to which transaction applies:
                              Not Applicable
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     (2)  Aggregate number of securities to which transactions applies:
                              Not Applicable
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     (3)  Per unit price or other underlying value of transaction
          computed  pursuant to Exchange Act Rule 0-11.
                              Not Applicable
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     (4)  Proposed maximum aggregate value of transaction:
                              Not Applicable
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                              Not Applicable
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 [ ] Check box if any part of the fee is offset as provided by Exchange Act 
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Page 1


The following letters were sent to stockholders of Iwerks Entertainment,
Inc. on or about March 21, 1998.

March 20, 1998

Dear Stockholder:

By now, you probably know that in late February your Board of Directors
appointed me Chief Executive Officer, Chairman and President of Iwerks
Entertainment.  I wanted to write to personally introduce myself and say how
pleased I am to have this new responsibility and opportunity.

One of our first priorities is to ensure the completion of our merger with
Showscan Entertainment.  This transaction will help solidify our leadership
position in the ride simulation industry and deliver several tangible benefits,
including:  a combined network of more than 160 simulation theaters and 75
films;  cost savings from consolidated operations;  and a stronger base of
stable recurring revenues.

The transaction also represents a good value for Iwerks.  A considerable
portion of the transaction costs of completing the merger are related to
achieving cost-effective synergies between the two companies.  Merger expenses
include one-time charges that will produce on-going cost savings, such as the
consolidation of facilities and marketing commitments, write-downs of
Showscan's lease obligations, and severance payments related to redundant
positions, among others.  Given these demonstrated synergies, we believe that
the "all in" transaction costs are reasonable when considered in the context of
the strategic long-term benefits they will yield.  While Showscan has shown net
losses recently, the company has also generated continuous increases in
recurring film distribution revenues, which are of strategic importance to
Iwerks because they are both significant and STABLE.  By merging with Showscan,
we are using our cash for a high return investment:  a consistent stream of
recurring revenues that can help us accelerate our sales efforts in the giant
screen business and, ultimately, help build the long-term value of our stock.

Iwerks' Board of Directors has carefully considered the details and strategic
implications of this transaction and has unanimously agreed that the merger
provides clear long-term benefits to Iwerks and to you, our shareholders.  You
should have received your proxy materials in the last few days, and I URGE YOU
TO VOTE IN FAVOR OF THIS MERGER.

While the Showscan merger advances basic elements of our business strategy,
other elements are beginning to take shape as I review Iwerks' operations and
opportunities.  Historically, hardware sales have been Iwerks' main business. 
But it is apparent to me that Iwerks can be much more than just a supplier of
hardware.  With our team's talent and expertise, and our knowledge of and
experience in the entertainment industry, we can also help our customers
improve the overall performance and profitability of their attractions by
providing valuable resources and support for them in such key areas as
operations management, marketing, film programming and more.

We have already made our first management changes with these objectives in mind
- - most notably, the addition of Daniel Griesmer as Senior Vice President and
General Manager to oversee operations and product development, and the
promotion of Jon Corfino to Senior Vice President of Film Development and
Distribution.  The end goal is for Iwerks to be a provider of COMPLETE
ENTERTAINMENT ATTRACTIONS SOLUTIONS, a "finished product" with which Iwerks can
excel and, ultimately, deliver increased shareholder value.

Page 2


We have also begun to increase our involvement in the production of large-
format and simulation films.  An example is our partnership with nWave
Pictures, with whom we are now in production on a groundbreaking large-format
3-D film, "Encounter in the Third Dimension," and related ride simulation and
theme park attraction films, also in 3-D, which will premiere in September. 
The development of top quality entertainment content helps not only our
clients, who need exciting concepts to attract customers, it also helps us by
stimulating growth of the industry and providing us with additional recurring
revenue through film licensing.

Iwerks has many exciting opportunities ahead.  Our plans are beginning to take
form as we work to develop and implement our strategy and use our strengths and
expertise to our and our shareholders' greatest benefit.  I understand that
Iwerks' results have of late been disappointing to you as shareholders.  It is
our commitment to work to make Iwerks achieve its full potential and establish
our prominence in the entertainment industry.

I look forward to updating you regularly on our progress and welcome your
feedback at any point.  If you have any comments or questions, please don't
hesitate to call Iwerks and we will respond as best we can.  Also, please visit
our web site at WWW.IWERKS.COM where we keep the latest company news posted.

Thank you for your continuing support of Iwerks.



Charles Goldwater
Chairman of the Board, President and Chief Executive Officer


                     FORWARD-LOOKING STATEMENT DISCLOSURE
                     ------------------------------------

Note:  With the exception of the historical information, the matters discussed
above include forward-looking statements that involve risks and uncertainties. 
Certain important factors could cause actual results to differ materially from
those indicated in the forward-looking statements.  The ability of the combined
company to achieve cost savings and revenue growth will depend on its ability
to quickly and effectively merge the operations and the product lines and
manage the resulting larger operations.  Other factors impacting future results
include revenue, costs of sales and the ability of the Company to maintain
pricing at a level necessary to maintain gross profit margins, the level of
selling, general and administrative costs, the performance by the Company under
its existing purchase contracts and the ability to obtain new contracts, the
success of the Company's owned and operating strategy, the ability of the
Company to find additional sponsors for its Reactors' or alternative sources of
revenue, the ability of the Company to identify and successfully negotiate
arrangements with joint venture and other strategic partners, the success of
the Company's film software, the effects of technological developments,
competition, general economic conditions and acts of God and other events
outside the control of the Company.

Page 3


REQUEST FOR VOTE OF IWERKS ENTERTAINMENT, INC. SHAREHOLDERS

March 20, 1998

Dear Shareholder:

Proxy material was recently mailed to you for the vote on Iwerks Entertainment,
Inc.'s proposed merger with Showscan Entertainment Inc. We urge you to vote in
favor of this merger and return your ballot by March 31, 1998. Regardless of
the number of shares you own, your vote is very important. 

If you have already returned your ballot, thank you for your prompt response
and please ignore this message.

Thank you for your cooperation and support.

On behalf of the Board of Directors,



Charles Goldwater
President
Chief Executive Officer




QUESTIONS?  Call our proxy solicitor, Beacon Hill Partners, at 1-800-253-3814
between 8 a.m. and 6 p.m. EST
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IF YOU HAVE ALREADY MAILED YOUR BALLOT, PLEASE ACCEPT OUR THANKS AND DISREGARD
THIS REQUEST.