U S LONG DISTANCE CORP
S-3, 1997-04-14
TELEPHONE COMMUNICATIONS (NO RADIOTELEPHONE)
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          As filed with the Securities and Exchange Commission
                            on April 14, 1997

                                          Registration No. 333-_______
======================================================================

                              UNITED STATES
                    SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C. 20549
                                     
                                     
                                     
                                 FORM S-3
          REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
                                     
                                     
                                     
                         U.S. LONG DISTANCE CORP.
          (Exact name of Registrant as specified in its charter)

           Delaware                               74-2522103
 (State or other jurisdiction                  (I.R.S. Employer
of incorporation or organization)            Identification No.)

                         9311 San Pedro, Suite 100
                         San Antonio, Texas 78216
                              (210) 525-9009
       (Address, including zip code, and telephone number, including
          area code, of Registrant's principal executive offices)

                            W. AUDIE LONG, ESQ.
                  Senior Vice President - General Counsel
                          U.S. LONG DISTANCE CORP
                           9311 San Pedro, Suite
                            San Antonio, Texas
                              (210) 525-9009
             (Name, address, including zip code, and telephone
            number, including area code, of agent for service)

                                 Copy to:
                          JOSEPH A. HOFFMAN, ESQ.
                              Arter & Hadden
                       1717 Main Street, Suite 4100
                         Dallas, Texas 75201-4605
                               (214) 761-4779



    Approximate date of commencement of proposed sale to the public:
As soon as practicable after the effective date of this Registration State
ment.

     If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [ ]

     If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection
with dividend or interest reinvestment plans, check the following box.  [X]

     If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of
the earlier effective registration statement for the same offering. [ ]

     If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering.  [ ]

     If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]

<TABLE>
<CAPTION>
                     CALCULATION OF REGISTRATION FEE
==============================================================================================================
                                                     Proposed              Proposed
Title of Each Class of          Amount to be      Maximum Offering      Maximum Aggregate       Amount of
Securities to be Registered     Registered(1)    Price Per Share(1)     Offering Price(1)    Registration Fee
- --------------------------------------------------------------------------------------------------------------
<S>                             <C>                 <C>                   <C>                     <C>
Common Stock
  $.01 par value                225,000 shares      $11.3125              $2,545,312.50           $771.31
- --------------------------------------------------------------------------------------------------------------
(1)  Estimated solely for purposes of calculating the registration fee
     based upon the average of the high and low prices of the Common Stock
     on the Nasdaq Stock Market's National Market on April 8, 1997, in
     accordance with Rule 457(c).

</TABLE>

     The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the
Registrant shall file a further amendment which specifically states that
this Registration Statement shall thereafter become effective in accordance
with Section 8(a) of the Securities Act of 1933, as amended, or until this
Registration Statement shall become effective on such date as the
Commission, acting pursuant to said Section 8(a), may determine.

============================================================================
<PAGE>

                          CROSS REFERENCE SHEET

                 Pursuant to Regulation S-K, Item 501(b)
      Showing Location of Information Required by Items of Form S-3


           Item of Form S-3             Prospectus Caption or Location
- ---------------------------------       ------------------------------------

1.   Forepart of the Registration       Forepart of the Registration
     Statement and Outside Front        Statement; Facing Page; Cross
     Cover Pages of Prospectus          Reference Sheet; Outside Front
                                        Cover Page of Prospectus

2.   Inside Front and Outside Back      Inside Front and Outside Back
     Cover Pages of Prospectus          Cover Pages of Prospectus;
                                        Available Information;
                                        Incorporation of Certain
                                        Documents by Reference; Table
                                        of Contents

3.   Summary Information, Risk          Prospectus Summary; Risk
     Factors and Ratio of Earnings      Factors; The Company
     to Fixed Charges

4.   Use of Proceeds                    Use of Proceeds

5.   Determination of Offering          Not Applicable
     Price

6.   Dilution                           Dilution

7.   Selling Security Holders           Selling Stockholders; Plan of
                                        Distribution

8.   Plan of Distribution               Outside Front Cover Page of
                                        Prospectus; Plan of
                                        Distribution

9.   Description of Securities          Description of Capital Stock
     to be Registered

10.  Interests of Named                 Not Applicable
     Experts and Counsel

11.  Material Changes                   Not Applicable

12.  Incorporation of Certain           Incorporation of Certain
     Information by Reference           Documents by Reference

13.  Disclosure of Commission           Not Applicable
     Position on Indemnification
     for Securities Act Liabilities


<PAGE>

          SUBJECT TO COMPLETION - DATED APRIL 14, 1997

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT
A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION.  THESE SECURITIES MAY
NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE
REGISTRATION STATEMENT BECOMES EFFECTIVE.  THIS PROSPECTUS SHALL NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY
NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH 
SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION
OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY STATE.



PROSPECTUS

                              225,000 Shares
                         U.S. LONG DISTANCE CORP.
                               Common Stock


     The 225,000 shares (the "Shares") of common stock, par value $.01
per share (the "Common Stock"), of U.S. Long Distance Corp. (the
"Company") to which this Prospectus relates are being offered on
behalf of and for the account of certain stockholders (the "Selling
Stockholders") of the Company.  The Company anticipates that the
Shares will be offered for sale until the earlier of (i) the sale of
all of the Shares, or (ii) the one-year anniversary of the issuance of
the Shares after the effectiveness of this Registration Statement.
The Company has agreed to pay all expenses of registration in
connection with this offering, but will not receive any of the
proceeds from the sale of the Shares being offered hereby.  All fees
and disbursements of counsel for each of the Selling Stockholders, and
all brokerage commissions and other similar expenses incurred by such
Selling Stockholders will be borne by such Selling Stockholders. The
aggregate proceeds to the Selling Stockholders from the sale of the
Shares will be the purchase price of the Shares sold, less the
aggregate brokerage commissions and underwriters' discounts, if any,
and other expenses of issuance and distribution not borne by the
Company. See "Use of Proceeds," "Plan of Distribution" and "Selling
Stockholders."

     The Common Stock is included in the Nasdaq Stock Market's
National Market (the "Nasdaq National Market") under the symbol
"USLD." On April 8, 1997, the last reported sales price for the Common
Stock was $11.3125 per share.

     This offering of the Shares is currently not being underwritten.
However, the Selling Stockholders, brokers, dealers or underwriters
that participate with the Selling Stockholders in the distribution of
the Shares may be deemed "underwriters," as that term is defined in
the Securities Act of 1933, as amended (the "Securities Act"), and any
commissions received by broker-dealers, agents or underwriters and any
profit on the resale of the Shares purchased by them may be deemed to
be underwriting commissions or discounts under the Securities Act.
Although neither the Company nor the Selling Stockholders have entered
into any arrangement or underwriting agreement with any broker-dealer
or agent, the Shares being offered hereby, when sales thereof are
made, may be made in one or more transactions (which may involve one
or more block transactions) through customary brokerage channels,
either through brokers acting as brokers or agents for the sellers, or
through dealers or underwriters acting as principals who may resell
the Shares in the Nasdaq National Market or in privately negotiated
sales, or otherwise, or by a combination of such methods of offering.
Each sale may be made either at market prices prevailing at the time
of the sale or at negotiated prices.

     If and to the extent required, the specific number of Shares to
be sold, the names of the Selling Stockholders, the purchase price,
the public offering price, the names of any such agents, dealers or
underwriters and any applicable commissions or discounts with respect
to a particular offer will be set forth in an accompanying Prospectus
Supplement.

     See "Risk Factors" on page 5 for a discussion of certain material
factors that should be considered in connection with an investment in
the shares of Common Stock offered hereby.


       THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
         SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
          COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
             OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
                ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
                     REPRESENTATION TO THE CONTRARY IS
                            A CRIMINAL OFFENSE.

                           _______________, 1997
  
<PAGE>

                        AVAILABLE INFORMATION

     The Company is subject to the informational reporting requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and,
in accordance therewith, files reports, proxy statements and other
information with the Securities and Exchange Commission (the "Commission").
Such reports, proxy statements and other information filed by the Company
with the Commission may be inspected and copied at the Public Reference
Section of the Commission at Judiciary Plaza, Room 1024, 450 Fifth Street,
N.W., Washington, D.C. 20549 and at the following Regional Offices of the
Commission: Chicago Regional Office, Northwestern Atrium Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661; and New York Regional
Office, Seven World Trade Center, New York, New York 10048.  Copies of such
materials also may be obtained by mail at prescribed rates from the Public
Reference Section of the Commission at Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549.  In addition, such materials filed
electronically by the Company with the Commission are available at the
Commission's World Wide Web site at http://www.sec.gov.

     The Common Stock is listed on the Nasdaq National Market, and reports
and other information concerning the Company may be inspected and copied at
the offices of the Nasdaq National Market at 1735 K Street, N.W.,
Washington, D.C. 20006.

     The Company has filed with the Commission a Registration Statement on
Form S-3 under the Securities Act with respect to the Shares of Common
Stock offered hereby. As permitted by the rules and regulations of the
Commission, this Prospectus omits certain information contained in that
Registration Statement. For further information with respect to the Company
and the Shares offered hereby, reference is hereby made to the Registration
Statement and its exhibits and schedules. The Registration Statement may be
inspected without charge at the Public Reference Section of the Commission
at Judiciary Plaza, Room 1024, 450 Fifth Street, N.W., Washington, D.C.
20549, and copies may be obtained therefrom at prescribed rates. Statements
contained herein concerning provisions of documents are necessarily
summaries of such documents, and each statement is qualified in its
entirety by reference to the copy of the applicable document filed with the
Commission.

           INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

     The following documents filed by the Company with the Commission under
the Exchange Act are hereby incorporated by reference in this Prospectus:
(i) the Company's Annual Report on Form 10-K for the fiscal year ended
September 30, 1996, and (ii) the Company's Quarterly Report on Form 10-Q
for the quarter ended December 31, 1996.

     All reports and other documents filed by the Company with the
Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange
Act after the date of this Prospectus and prior to the termination of the
offering of the Shares made hereby shall be deemed to be incorporated by
reference herein and to be a part hereof from the date of filing of such
reports and documents. Any statement contained in a document incorporated
by reference herein shall be deemed to be modified or superseded for
purposes of this Prospectus and the Registration Statement of which it is a
part to the extent that a statement contained herein or in a subsequently
filed document modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus or the Registration
Statement.

     Upon written or oral request, the Company will provide without charge
to each person to whom a copy of this Prospectus is delivered, a copy of
any and all of the documents incorporated herein by reference (other than
exhibits to such documents, unless such exhibits are specifically
incorporated by reference into such documents). Requests should be directed
to U.S. Long Distance Corp., 9311 San Pedro, Suite 100, San Antonio, Texas
78216, Attention: Investor Relations (210) 525-9009.

                              -2-

<PAGE>

                       PROSPECTUS SUMMARY


     The following Summary is qualified in its entirety by the
more detailed information appearing elsewhere in this Prospectus
or in the documents incorporated by reference.


                          THE COMPANY

GENERAL

     U.S. Long Distance Corp. (the "Company") is a fully-
integrated long distance communications company offering an
integrated group of communication services including direct dial
long distance, prepaid calling cards, travel cards, data
transmission and calling center services.

     On July 10, 1996, the Company's Board of Directors approved
a plan to spin off the Company's commercial billing clearinghouse
and information management services business ("Billing Group
Business") as a separate public company (the "Distribution").  To
effect the spinoff, the Board approved the distribution of the
outstanding shares of common stock of its wholly owned subsidiary
that owned and operated the Billing Group Business, Billing
Information Concepts Corp. ("Billing"), to its stockholders.  The
Distribution was tax-free for federal income tax purposes to the
stockholders of the Company, and the Company will not recognize
income, gain or loss as a result of the Distribution, except for
direct spinoff costs.  The Distribution was completed on August
2, 1996.

DIRECT DIAL LONG DISTANCE SERVICES

     The Company is a full-service long distance carrier
currently providing direct dial long distance services to small
and medium-sized commercial customers and, to a lesser extent,
residential customer accounts.  The Company began offering direct
dial long distance services following its entry into the direct
dial long distance business in August 1991 through the
acquisition of three related direct dial long distance companies
in Texas.  The Company focuses its direct sales efforts in the
West Coast, Pacific Northwest, Southwest and Southeast regions of
the United States to take advantage of network efficiencies.  In
addition to its basic "one-plus" service, the Company provides
inbound 800/888 service, travel and prepaid calling card
services, private line services, data transmission services,
wholesale carrier services and other customer-specific products.

OPERATOR SERVICES

     The Company provides operator assisted services for private
pay telephones, hotels, motels, university dormitories and
hospitals.  The Company's operator services are accessed when
calls requiring operator assistance and/or alternate billing
options are placed from customer locations.  Such services
involve the use of live and automated operators to receive,
validate and complete the calls.  The Company processes collect,
third-party, person-to-person and calling card calls and,
generally, shares a percentage of call revenues with its
customers.

                              -3-

<PAGE>

                          The Offering

Common Stock Offered by the Selling Stockholders.....  225,000 shares

Percent of Outstanding Common Stock of the
Company held by the Selling Stockholders.............  1.5%(1)

Nasdaq National Market Symbol........................  USLD

Use of Proceeds......................................  The Company will not
                                                       receive any of the
                                                       proceeds from the sale
                                                       of the Shares being
                                                       offered hereby
_______________
(1)  Percentage indicated is based upon 15,377,008 shares of
     Common Stock outstanding as of April 8, 1997.

                              -4-

<PAGE>

                          RISK FACTORS

     OTHER THAN HISTORICAL AND FACTUAL STATEMENTS, THE MATTERS
AND ITEMS DISCUSSED IN THIS PROSPECTUS ARE FORWARD-LOOKING
STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES.  THE COMPANY'S
ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THE RESULTS DISCUSSED
IN THE FORWARD-LOOKING STATEMENTS.  IN ADDITION TO OTHER
INFORMATION CONTAINED IN THIS PROSPECTUS, THE FOLLOWING FACTORS
COULD CONTRIBUTE TO SUCH DIFFERENCES.  PROSPECTIVE INVESTORS
SHOULD CAREFULLY CONSIDER THE FOLLOWING FACTORS AND CAUTIONARY
STATEMENTS IN DETERMINING WHETHER TO PURCHASE SHARES OF COMMON
STOCK IN THE OFFERING MADE HEREBY.  ALL FACTORS SHOULD BE
CONSIDERED IN CONJUNCTION WITH THE OTHER INFORMATION AND
FINANCIAL DATA APPEARING ELSEWHERE IN THIS PROSPECTUS AND IN THE
DOCUMENTS INCORPORATED HEREIN BY REFERENCE.  SEE "DISCLOSURE
REGARDING FORWARD-LOOKING STATEMENTS."

     GOVERNMENT REGULATION; PROPOSED ACTIONS.  The Company's
activities are subject to the regulations of the Federal
Communications Commission (the "FCC") and the public utility
commissions of the various states in which the Company operates.
These regulatory agencies are governed by respective federal or
state legislation, and therefore, any change or modification to
such regulation or legislation can result in positive or negative
effects upon the Company.  State and federal regulatory actions
have had, and are expected to continue to have, both positive and
negative effects upon the Company.  Decisions by the state or
federal legislative or regulatory bodies with respect to the
permissible business activities or pricing practices of the
Company's dominant competitors, such as American Telephone and
Telegraph Company ("AT&T") and the seven Regional Bell Operating
Companies ("RBOCs"), also may have an adverse impact on the
Company's operations.  Moreover, any significant change in
regulations by federal or state governmental agencies could
significantly increase the Company's costs or otherwise have an
adverse effect on the Company's activities and on its expansion
efforts.

     ACQUISITION PROGRAM.  The Company is actively engaged in an
acquisition program, focusing primarily on acquisitions in the
direct dial long distance industry.  One or more of such
acquisitions could result in a substantial change in the
Company's operations and financial condition.  The success of the
Company's acquisition program will depend upon, among other
things, the availability of acquisition candidates, the
availability of funds to finance acquisitions and the
availability of management resources to oversee the operation of
acquired businesses.  No assurance can be given that the Company
will succeed in consummating any additional acquisitions or that
the Company will be able to successfully integrate and manage any
acquisitions.  While the Company has, from time to time, had
discussions with direct dial long distance companies, other than
as described in the documents incorporated herein by reference,
the Company has no pending negotiations or agreements for any
acquisitions at the date of this Prospectus.

     As consideration for any acquisitions, in addition to or in
lieu of the payment of cash, the Company may issue Common Stock,
preferred stock, convertible debt or other securities that could
result in substantial dilution of the percentage ownership of
public stockholders.  The Company does not intend to seek
stockholder approval for any such acquisitions or security
issuances unless required by applicable law or regulations.  See
"Description of Capital Stock."

     TECHNOLOGICAL CHANGE AND NEW SERVICES.  The
telecommunications industry has been characterized by steady
technological change, frequent new service introductions and
evolving industry standards.  The Company believes that its
future success will depend on its ability to anticipate such
changes and to offer on a timely basis market responsive services
that meet these evolving industry standards.  There can be no
assurance that the Company will have sufficient resources to make
the investments necessary to acquire new technology or to
introduce new services that would satisfy an expanded range of
customer needs.

     DEPENDENCE UPON THIRD PARTY TRANSMISSION FACILITIES.  The
Company currently owns only a portion of the transmission
facilities needed to complete long distance telephone calls.
Therefore, the Company's operator services and direct dial long
distance telephone businesses are dependent upon contractual
arrangements, both long and short-term, with facilities-based
carriers for the transmission of calls.  While the Company
believes that it has ample access to 

                              -5-

<PAGE>

transmission facilities at competitive rates and expects to
continue to have such access in the foreseeable future, this
ongoing availability cannot be assured.

     SERVICE INTERRUPTIONS; EQUIPMENT FAILURES.  The Company's
business requires that transmission and switching facilities and
other equipment be operational 24 hours per day, 365 days per
year.  Long distance telephone companies such as the Company on
occasion may experience temporary service interruptions or
equipment failures, in some cases resulting from causes beyond
their control.  Any such event experienced by the Company would
impair the Company's ability to service its customers and could
have a material adverse effect on the Company's business.

     INCREASED EXPENDITURES FOR ANTICIPATED EXPANSION.  To
facilitate and support the growth anticipated in its business,
the Company is significantly expanding its level of operations,
and thus increasing its investments in personnel and facilities.
Due to the increases in the Company's overhead and operating
expenses resulting from this expansion, the Company's operating
results may be adversely affected if its revenues remain flat or
do not increase to the extent expected.

     SEASONAL VARIATIONS IN REVENUES.  Approximately 95% of the
Company's direct dial long distance revenues are generated by
commercial customers, and accordingly, the Company experiences
general decreases in long distance revenues around national
holidays when commercial traffic is reduced.  The Company
typically experiences decreases in operator services revenues in
the fall and winter months as pay telephone usage declines due to
cold and inclement weather in many parts of the United States.
As a result of the seasonal variations discussed above, revenue
reported in the Company's first fiscal quarter ending December 31
(which includes Thanksgiving, Christmas and New Year's holidays)
historically has been the lowest level of any quarter of the
year.  Conversely, due to increased traffic from pay telephones
during the spring and summer months and a lower concentration of
national holidays, the Company historically has experienced its
highest revenue levels in the third and fourth quarters of the
fiscal year.  Because the Company's fixed operating expenses do
not decrease during the first quarter, the Company's
profitability is also, generally, at its lowest level for any
quarter of the year.

     CUSTOMER ATTRITION.  The Company believes that a high level
of customer attrition is common in the direct dial long distance
and operator services industries.  Although the Company has not
experienced significant attrition in its various businesses, the
Company's historical levels of customer attrition may not be
indicative of future attrition levels, and there can be no
assurance that any steps taken by the Company to counter
increased customer attrition would accomplish the Company's
objectives.  In addition, recent acquisitions and consolidations
in the telecommunications industry have resulted in, and may in
the future result in, the loss of customers by the Company
because of the acquisition of these customers by large companies
that have existing contractual relationships with the Company's
competitors.

     COMPETITION.  The long distance telecommunications industry
is intensely competitive and is significantly affected by new
service introductions and the market activities of major industry
participants.  Competition in the operator services and direct
dial long distance businesses is based upon pricing, customer
service, network quality and value-added services.  In operator
services, the Company competes with AT&T, MCI Telecommunications
Corporation ("MCI"), Sprint Incorporated ("Sprint") and
approximately 125 other operator services companies across the
continental United States.  AT&T continues to dominate
competition in the direct dial long distance telecommunications
market, with other competitors in this business being MCI and
Sprint as well as a large number of regional and local providers
of long distance services.  Additionally, the Telecommunications
Act of 1996 allows the RBOCs to compete in the long distance
industry.  Some of the Company's competitors have greater name
recognition, more extensive transmission networks and greater
engineering and marketing capabilities than the Company and have,
or have access to, substantially greater financial and personnel
resources than those available to the Company.  The ability of
the Company to compete effectively in the telecommunications
industry will depend upon its continued ability to maintain high
quality, market driven services at prices generally equal to or
below those charged by its 

                              -6-

<PAGE>

competitors.  There can be no assurance that the Company will be able
to compete successfully with existing or future competitors.

     SHARES ELIGIBLE FOR FUTURE SALE.  Upon the sale of all of
the Shares of Common Stock offered hereby, and assuming no
further issuance of shares of Common Stock by the Company,
15,602,008 shares of Common Stock will be outstanding,
substantially all of which will be freely tradeable without
restriction (except to the extent owned by affiliates of the
Company).  In addition to the foregoing, at April 8, 1997,
2,278,143 shares of Common Stock were issuable upon the exercise
of outstanding employee and director stock options (of which
999,658 were exercisable on such date) and options exercisable
for 1,309,577 shares of Common Stock and grants for 312,000
shares of Common Stock remained available for grant under the
Company's employee and non-employee director stock option plans
and restricted stock plans, respectively.  Any shares issued upon
the exercise of stock options may be freely sold in the public
market (except to the extent issued to affiliates of the
Company).

     Pursuant to certain telecommunications service agreements,
the Company agreed, among other things, to grant certain
warrants, exercisable for a period of seven years, to purchase up
to an aggregate of 225,000 shares of the Company's Common Stock
at an exercise price of $3.24 per share.  One half of the shares
underlying the warrants (112,500 shares) are vested, and the
remaining one half of such shares (112,500 shares) vest on
January 15, 1998.  The Company has filed a registration statement
(of which this prospectus forms a part) to register for sale with
the Commission the number of shares that may be sold by the
Selling Stockholders upon the exercise of the contingent
warrants.

     Any future sales of substantial amounts of Common Stock in
the open market by the Selling Stockholders, by employees or
directors exercising stock options, by stockholders or
warrantholders whose shares have been registered with the
Commission by the Company or by other stockholders may adversely
impact the market price of the Common Stock.

        DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

     This Prospectus contains certain "forward-looking
statements" within the meaning of the Section 27A of the
Securities Act and Section 21E of the Exchange Act.
Specifically, all statements other than statements of historical
facts included in this report regarding the Company's financial
position, business strategy and plans and objectives of
management of the Company for future operations are forward-
looking statements.  These forward-looking statements are based
on the beliefs of the Company's management, as well as
assumptions made by and information currently available to the
Company's management.  When used in this report, the words
"anticipate," "believe," "estimate," "expect" and "intend" and
words or phrases of similar import, as they relate to the Company
or Company management, are intended to identify forward-looking
statements.  Such statements reflect the current view of the
Company with respect to future events and are subject to certain
risks, uncertainties and assumptions related to certain factors
including, without limitation, competitive factors, general
economic conditions, customer relations, relationships with
vendors, the interest rate environment, governmental regulation
and supervision, seasonality, the operation of the Company's
networks, transmission costs, product introductions and
acceptance, technological change, changes in industry practices,
one-time events and other factors described herein ("cautionary
statements").  Although the Company believes that the
expectations are reasonable, it can give no assurance that such
expectations will prove to be correct.  Based upon changing
conditions, should any one or more of these risks or
uncertainties materialize, or should any underlying assumptions
prove incorrect, actual results may vary materially from those
described herein as anticipated, believed, estimated, expected or
intended.  All subsequent written and oral forward-looking
statements attributable to the Company or persons acting on its
behalf are expressly qualified in their entirety by the
applicable cautionary statements.

                              -7-

<PAGE>

                          THE COMPANY

     OTHER THAN HISTORICAL AND FACTUAL STATEMENTS, THE MATTERS
AND ITEMS DISCUSSED HEREIN ARE FORWARD-LOOKING STATEMENTS THAT
INVOLVE RISKS AND UNCERTAINTIES.  ACTUAL RESULTS OF THE COMPANY
MAY DIFFER MATERIALLY FROM THE RESULTS DISCUSSED IN THE FORWARD-
LOOKING STATEMENTS.  CERTAIN FACTORS THAT COULD CONTRIBUTE TO
SUCH DIFFERENCES ARE DISCUSSED IN "RISK FACTORS, WITH THE FORWARD-
LOOKING STATEMENTS THROUGHOUT THIS PROSPECTUS AND IN "DISCLOSURE'S
REGARDING FORWARD-LOOKING STATEMENTS."

GENERAL

     The Company is a fully-integrated long distance
communications company.  From fiscal 1991 through fiscal 1996,
the Company's revenues increased at a compounded annual rate of
60%, totaling $180.3 million for fiscal 1996.  The Company offers
an integrated group of communication services including direct
dial long distance, prepaid calling cards, data transmission and
calling center services.

     The long distance telephone industry has changed
significantly since the mandated divestiture by AT&T of its 22
local telephone companies in 1984.  Regulations mandating equal
access to the existing telecommunications network led to the
creation of hundreds of new long distance companies.  Competition
now pervades across all categories of long distance telephone
services, including both domestic and international direct dial
long distance telephone services, operator assisted and calling
card services and 800/888 specialized in-bound long distance
telephone services.  While AT&T and, to a lesser extent, MCI and
Sprint, together dominate the estimated $78 billion long distance
telecommunications industry, management believes that a growing
share of the market is serviced by smaller long distance
companies such as the Company.  Industry sources estimate that
approximately 80% of the long distance market is shared among
AT&T, MCI and Sprint.

     The Telecommunications Act of 1996, which was signed into
law on February 8, 1996, is the first major overhaul of the
telecommunications law since the divestiture of AT&T.  This act
allows telecommunications providers such as the Company to
provide local telephone services.  The local telephone service
industry is estimated to be a $95 billion industry and is
dominated by the RBOCs.  The Company is actively pursuing its
entrance into the local service industry.  The Company is
currently certified to offer local service in four states and has
certification pending in four other states.  The Company has
signed an interconnection agreement with Southwestern Bell
enabling the Company to provide local telephone service to
business and residential customers in Southwestern Bell's five-
state service area.  The Company also has entered into a local
resale agreement with BellSouth Telecommunications for their nine-
state service territory. Additionally, the Telecommunications Act
of 1996 allows the RBOCs to compete in the long distance
industry.  However, the applicant RBOC must first satisfy a
legislative "checklist" that outlines the steps required for an
RBOC to open its network to competition on a local basis.

     On July 10, 1996, the Company's Board of Directors approved
a plan to spin off the Company's Billing Group Business as a
separate public company.  To effect the Distribution, the Board
approved the distribution of the outstanding shares of common
stock of Billing to its stockholders.  The Distribution was tax-
free for federal income tax purposes to the stockholders of the
Company, and the Company will not recognize income, gain or loss
as a result of the Distribution, except for direct spinoff costs.
The Distribution was completed on August 2, 1996.

DIRECT DIAL LONG DISTANCE SERVICES

     The Company is a full-service long distance carrier
currently providing direct dial long distance services to small
and medium-sized commercial customers and, to a lesser extent,
residential customer accounts.  The Company was authorized to
provide direct dial long distance services to customers in 47
states at December 31, 1996.  However, the Company focuses its
direct sales efforts in the West Coast, Pacific Northwest,
Southwest and Southeast regions of the United States to take
advantage of network efficiencies.  In addition to its basic "one-
plus" service, the Company 

                              -8-

<PAGE>

provides inbound 800/888 service, travel and prepaid calling card
services, private line services, data transmission services, wholesale
carrier services and other customer-specific products.

     The Company began offering direct dial long distance
services following its entry into the direct dial long distance
business in August 1991 through the acquisition of three related
direct dial long distance companies in Texas.  At December 31, 1996,
the Company serviced approximately 47,000 commercial and residential
customer accounts.  The Company carried an average of 106.5 million
minutes per month of long distance traffic during the fiscal quarter
ended September 30, 1996, as compared to 62.6 million and 44.7
million during the fiscal quarters ended September 30, 1995 and 
1994, respectively.  In fiscal year 1996, 1995 and 1994, the Company
had $119.4 million, $84.5 million and $62.8 million, respectively, in
direct dial long distance revenues, comprising 66%, 59% and 53% of
total operating revenues in each period, respectively.

INDUSTRY OVERVIEW

     Direct dial long distance revenues industrywide are
estimated to be approximately $78 billion in 1996, up from
approximately $73 billion in 1995.  AT&T, MCI and Sprint dominate
the long distance industry.  Industry sources estimate that these
companies control a combined market share of approximately 80%.
These companies offer comprehensive communications services in a
wider array of products than other long distance companies and
typically target national, multi-state business customers and
millions of residential long distance users through national
television and media advertising.  The Company believes that over
500 smaller long distance companies account for the remaining 20%
of the market.  These companies typically concentrate on smaller
regional and local business customers.  Competition in the direct
dial long distance industry has historically been based upon
price. More recently, the focus has been moving towards customer
service, product design and innovation, customized billing
capabilities, transmission quality and availability of service.

SALES AND MARKETING

     The Company's direct dial long distance personnel are
located throughout the Company's service area and are responsible
for marketing to commercial accounts.  The Company supervises
sales and marketing efforts from its corporate headquarters and
utilizes various advertising media to enhance its commercial
marketing efforts and to attract and retain residential
customers.  The Company examines the calling profiles of target
markets and designs long distance services that specifically fill
certain demands.  For example, the Company issues long distance
calling cards customized to include a customer's corporate logo
and also has customized prepaid calling cards to be used as
promotional marketing tools.  The Company also markets directly
to employees of commercial customers for their residential
service.  In addition to its own sales force, the Company markets
its direct dial long distance services through authorized agents,
other carriers and affinity organizations (strategic
partnerships).

     The Company currently has an exclusive marketing agreement
with Nolan Ryan, formerly a player with the Texas Rangers[REGISTERED]
professional baseball team and a potential hall of fame
candidate, who acts as the Company's spokesman for its direct
dial long distance services and whose picture appears in the
Company's advertisements and product literature, including
prepaid calling cards.

OPERATIONS

     The Company completes calls that are originated when a pre-
subscriber customer dials "1" plus the area code and number or
when a customer selects the Company's network through dial-up
access to reach any domestic or international destination.  All
long distance calls placed over the Company's network are
directed to call designation points by computerized digital
network switching equipment operating at one of the Company's
switching centers.  The switching equipment receives a customer's
direct dial call, verifies the caller's billing status and
authorization codes, routes the call to the dialed destination,
monitors the call's duration and collects other information for
billing purposes.

                              -9-

<PAGE>

The Company's switching equipment selects the most cost-efficient
transmission circuit or path available prior to switching and
completing each call.  The Company employs state-of-the-art digital
switching equipment at the Company's switching centers in Houston,
Texas; Waco, Texas; Seattle, Washington; and Los Angeles, California.
The Company has also purchased a digital switch in Atlanta, Georgia,
which it took possession of in January 1997.

     To satisfy increasing or anticipated usage of its long
distance network and to ensure that its network is optimally
accessible when network demand is heavy, the Company, from time
to time, adds circuit capacity at each existing switching center
by increasing the number of telecommunications ports and access
lines.  The Company utilizes state of the art Common Channel
Signaling System 7, which is currently operational for virtually
all originating and terminating traffic within the Company's
markets.  This network protocol significantly reduces connect
time delays and provides additional technical capabilities and
efficiencies for the routing of calls.

COMPETITIVE ADVANTAGES

     The Company competes with AT&T, MCI and Sprint and numerous
local, regional and national carriers on the basis of its
products and services, competitive pricing and local identity.
The Company generally prices its services up to 20% below AT&T,
MCI and Sprint comparable service offerings.  In addition, by
designing long distance products and services that fill specific
market needs, the Company enhances its ability to compete with
AT&T, MCI and Sprint and others.

     The Company believes that its emphasis on customer service
distinguishes the Company from many of its competitors.  The
Company has taken an integrated team approach to sales and
service by increasing the number of sales support representatives
in its field offices to maintain responsive service after the
sale.  The Company recently issued notebook computers to the
sales force to enhance marketing presentations and automate the
customer order entry function.  Additionally, the Company
implemented a computerized bulletin board service called
Advantage Direct, which is similar to the remote access service
offered to its operator services customers.  This service allows
customers to monitor and evaluate calling patterns and volume by
department or location.  Moreover, in competing with certain
regional and local long distance carriers, the Company believes
it holds a competitive advantage within its territory because the
Company's regional concentration of traffic over its network
facilities allows for certain cost efficiencies of a national
carrier.  In addition, the Company believes that its local
identity in the markets it serves provides an advantage in
marketing its services and competing with long distance carriers
based outside of the target regions.  Management believes that
the Company has developed the expertise in information systems
necessary to meet the needs of its direct dial long distance
customers.  For instance, the Company provides an invoice
indicating call detail in a form that assists customers in
controlling and monitoring communications costs for various
projects or departments.

     The Company employs digital switching equipment utilizing a
network comprised largely of high quality fiber-optic circuitry
to maximize communications quality.  The Company believes that
its use of a digital network is particularly advantageous in
marketing both its voice and data transmission services.  The
Company also designs redundant and diverse routes to each major
service area to ensure service availability.

     The communications industry is ever-changing, and the
recently passed Telecommunications Act of 1996 is expected to
have a major impact on the industry's competitive environment.
In essence, the RBOCs will be competing with long distance
carriers for both domestic and international long distance
customers.  The Company believes it is prepared to meet this
challenge by capitalizing on its experienced management team and
sales force, personalized customer service, quality products and
services and competitive pricing structures.

STRATEGY AND GROWTH OPPORTUNITIES

     The Company's strategic focus in the direct dial long
distance industry is to compete with AT&T, MCI and Sprint
primarily on the basis of competitive pricing, while offering a
comparable or higher level of service.  Moreover,


                              -10-

<PAGE>

the Company intends to remain focused on small and medium-sized 
commercial customers and will continue its efforts to develop
innovative and cost-efficient services that meet the needs of its
customers. The Company intends to introduce new communications 
products, such as local service, Internet access, paging, frame
relay/ISDN and cellular service, over the next 12 to 18 months. The
introduction of the local service product provides the Company
the largest opportunity for growth.  The local services industry
is estimated to be a $95 billion market.  Each of the Company's
existing 47,000 customer accounts is already utilizing this
service from the local exchange carrier in each locality.  The
Company believes that it has the potential to capitalize on its
relationship with existing customers to bundle the local product
with its existing products and services.  The bundling of these
services with long distance service will enhance the Company's
product offerings and provide new and existing customers with the
integrated communication services they desire.  To a lesser
extent, the Company also continues to market to residential
customers.

     The Company expects to look for opportunities to expand its
long distance business, both by internal growth and through
acquisitions.  The primary focus of the Company's acquisition
activities is to make additional acquisitions that will grow the
Company's direct dial long distance business.  The Company
believes its operator services business affords it the
opportunity to expand its direct dial long distance business on a
more cost-effective basis than many of its competitors.  By
having a concentration of operator services call traffic in a
particular geographic region, the Company can utilize any long
distance facilities it installs or acquires to service a ready
base of call traffic, thereby lowering the marginal transmission
costs for any direct dial long distance traffic that the Company
acquires or develops in that region.  The Company believes this
cost advantage not only improves the potential profitability of
both the Company's operator services and direct dial long
distance services business in such region, but also expands the
number of companies that would be attractive acquisition
candidates in that region.

     The Company continually evaluates business opportunities,
including potential acquisitions.  One or more of such
acquisitions could result in a substantial change in the
Company's operations and financial condition.  The success of the
Company's acquisition activities will depend upon, among other
things, the availability of acquisition candidates, the
availability of funds to finance acquisitions and the
availability of management resources to oversee the operation of
acquired businesses.  While the Company has, from time to time,
had discussions with communications companies, it has no
agreements or pending negotiations with respect to any
acquisition at the date of this report that would have a material
impact on the Company's financial position or results of
operations.  There is no assurance that any acquisitions will be
completed.

OPERATOR SERVICES

     The Company provides operator assisted services for private
pay telephones, hotels, motels, university dormitories and
hospitals.  The Company's operator services are accessed when
calls requiring operator assistance and/or alternate billing
options are placed from customer locations.  Such services
involve the use of live and automated operators to receive,
validate and complete the calls.  The Company processes collect,
third-party, person-to-person and calling card calls and,
generally, shares a percentage of call revenues with its
customers.

     At December 31, 1996, the Company provided operator services
to approximately 135,900 hotel, motel, hospital and dormitory
rooms.  In addition, at December 31, 1996, the Company had
service contracts with private pay telephone owners covering
approximately 61,300 pay telephones.  The Company carried 7.6
million average monthly minutes of operator services traffic
during the fourth quarter of fiscal 1996, as compared to 8.3
million and 9.1 million average monthly minutes during the fourth
quarters of fiscal 1995 and 1994, respectively.  The Company's
operator services revenues amounted to $60.9 million, $59.6
million and $54.7 million in fiscal 1996, 1995 and 1994,
respectively.

                              -11-

<PAGE>

INDUSTRY OVERVIEW

     Management believes that there are approximately 125
operator services providers competing within the long distance
communications industry.  AT&T continues to dominate the operator
services market, supplying operator services for traffic
originating from both the hospitality and pay telephone
industries.  Additionally, MCI and Sprint provide operator
services and are considered by management to be major
competitors.  Excluding AT&T, MCI, Sprint, General Telephone
Operating Companies ("GTE") and the RBOCs, management believes
the Company is one of the five largest providers of operator
services.

     Many operator services providers, including the Company,
initially focused on the hospitality industry.  More recently, as
the private pay telephone industry has grown and taken market
share from the public pay telephone market traditionally served
by AT&T, many operator services providers gained increased market
share by providing service to the owners of private and public
pay telephones. Competition between the Company and other
operator services providers is based upon commission programs,
quality of service, reporting and customer service.

SALES AND MARKETING

     The Company markets its operator services nationally through
the combined effort of regional sales representatives based in
Illinois, Texas, Florida and California and a network of agents.
The Company's corporate sales force focuses on larger accounts,
such as hotel management companies, multi-unit franchises,
hospital chains, large private pay telephone companies and
universities. The Company's agents market the Company's operator
services on a nationwide basis and typically receive a commission
based upon the volume of business generated.  The Company also
participates in various industry trade shows and promotes its
operator services through advertisements in trade magazines.  The
Company customizes its communications services to provide, among
other things, individualized reports and specialized call
branding to customers.

OPERATIONS

     The Company owns and operates its own operator center in San
Antonio, Texas, which employed 311 operators and support staff at
December 31, 1996.  The Company provides live and automated
operator services 24 hours per day, 365 days per year, and
features multi-lingual operators versed in Spanish, French,
German, Japanese and a variety of other languages.  The Company
maintains a sophisticated emergency call handling system that
enables its operator to access police, fire and other emergency
agencies within the jurisdiction of the telephone from which the
call is placed.  The Company utilizes its own transmission
facilities when possible or contracts to use facilities of other
long distance network providers as necessary.

     The Company switches the majority of its operator assisted
calls at its four main switching centers.  Many operator assisted
calls are transmitted to the Company's switching centers via call
processing equipment installed at customer locations or in
customer pay telephone equipment.  This call processing equipment
is programmed to recognize calls requiring operator assistance
and to access the Company's network by dialing the Company's
access number, then passing the call record information to one of
the switching centers.  The Company validates the authorization
code or telephone number to be billed and then completes the
call, while recording the date, destination, duration and time of
day for subsequent billing purposes.  At December 31, 1996, the
Company was authorized to complete international and interstate
calls placed throughout the United States, as well as intrastate
calls within 46 states.

COMPETITIVE ADVANTAGES

     Management believes that the Company enjoys several
competitive advantages over many others in the operator services
industry.  By virtue of the Company's large call volumes relative
to many other operator services 

                              -12-

<PAGE>

providers and the cost efficiencies it realizes by routing a large
portion of its operator services traffic over its own facilities
and maintaining its own operator center, the Company is able to
provide high quality transmission on an efficient and economical
basis. Additionally, because it is the source of commission payments
to its operator services customers, the Company believes that its
financial stability and history of timely payments allow it to
compete effectively against many smaller, under-capitalized
operator services providers.  Moreover, the Company's flexible
rate operations allow it to offer customized commission programs
to its customers as compared to larger operator services
providers.

     In 1994, the Company implemented a computerized bulletin
board service called Stealth that allows its customers to access
the system from remote locations and obtain customized and
sophisticated reporting of calling patterns and volumes for each
customer location or pay telephone.  This advanced reporting
system allows the Company's operator services customers to
analyze their traffic on a daily basis and maximize
telecommunications revenues by, for example, relocating
underutilized telephones.  The Company's detailed reporting also
allows its customers to reconcile the accuracy or integrity of
their commissions.  The Company employs a skilled, professional
staff of customer service employees and technicians, who provide
service 24 hours per day, 365 days per year.

STRATEGY AND GROWTH OPPORTUNITIES

     The Company has developed a strong presence in operator
services throughout the United States.  Through its direct sales
force and agents and its participation in state, regional and
national trade associations, the Company intends to pursue
geographic expansion on a nationwide basis.  The Company will
continue to market its operator services business to both the
private pay telephone and hospitality industries and present new
products and services for these markets.

     The Company's existing relationship with operator service
customers, who typically own or manage numerous private pay
telephones or hotels, provides a unique opportunity for the
Company.  The Company will have the potential to provide local
access to a large volume of phones lines, yet limited number of
customers.  These characteristics will allow the Company to
quickly and efficiently enter the local services market in
targeted areas.


                        USE OF PROCEEDS

     The Shares being offered hereby are for the account of the
Selling Stockholders. Accordingly, the Company will not receive
any of the proceeds from the sale of the Shares by the Selling
Stockholders. See "Selling Stockholders."


                            DILUTION

     The net tangible book value of the Company at December 31, 1996
was $45.8 million, or $3.04 per share. "Net tangible book value
per share" is equal to the Company's total tangible assets less
total liabilities (excluding deferred income taxes), divided by
the number of shares of Common Stock outstanding. Based on an
assumed public offering price of $11.3125 (the closing price of
the Common Stock on the Nasdaq National Market on April 8, 1997),
new investors purchasing shares at the public offering price
would experience an immediate dilution of $8.2725 in net tangible
book value per share.

     The following table illustrates the per-share dilution at
December 31, 1996:

     Assumed public offering price                   $11.3125
     Net tangible book value                         $ 3.04
     Assumed dilution to new investors
        in the offering                              $ 8.2725

                              -13-

<PAGE>

                      SELLING STOCKHOLDERS

     The following table sets forth the name of each of the
Selling Stockholders and the number of shares that may be offered
by each. The number of Shares that may be actually sold by the
Selling Stockholders will be determined by each Selling
Stockholder, and may depend upon a number of factors, including,
among other things, the market price of the Common Stock.
Because each Selling Stockholder may offer all, some or none of
the Shares that each holds, and because the offering contemplated
by this Prospectus is currently not being underwritten, no
estimate can be given as to the number of Shares that will be
held by any Selling Stockholder upon or prior to termination of
this offering.  See "Plan of Distribution." The table below sets
forth information as of April 8, 1997, concerning the beneficial
ownership of the Shares of each Selling Stockholder.  All
information as to beneficial ownership has been furnished by each
of the Selling Stockholders.

<TABLE>
<CAPTION>
                                                        
                                              Shares of Common          Common Stock          Common Stock
                                                Stock Owned              Offered in         Beneficially Owned
                                              Before Offering           The Offering         After Offering(1)
                                            ------------------         -------------        ------------------
                                            Number     Percent            Number             Number  Percent
                                           ---------   -------           ----------         -------- -------
<S>                                        <C>            <C>            <C>                    <C>     <C>
Communications  Central, Inc.......        125,000(2)     *              125,000(2)             0       0
Ronald I. McDougall................         33,334(3)     *               33,334(3)             0       0
John W. Savery.....................         33,333(4)     *               33,333(4)             0       0
Neil L. Ingram.....................         33,333(5)     *               33,333(5)             0       0
____________
* Represents less than 1%.

(1)  Assumes all shares of Common Stock offered hereby are sold.

(2)  Includes 62,500 shares that Communications Central, Inc. has
the right to acquire within 60 days upon the exercise of
outstanding warrants and 62,500 shares that vest on January 15, 1998.

(3)  Includes 16,667 shares that Mr. McDougall has the right to
acquire within 60 days upon the exercise of outstanding warrants
and 16,667 shares that may be acquired under such warrants beginning
on January 15, 1998.

(4)  Includes 16,666 shares that Mr. Savery has the right to acquire
within 60 days upon the exercise of outstanding warrants and 16,667
shares that may be acquired under such warrants beginning on 
January 15, 1998.

(5)  Includes 16,667 shares that Mr. Ingram has the right to acquire
within 60 days upon the exercise of outstanding warrants and 16,666
shares that may be acquired under such warrants beginning on 
January 15, 1998.

</TABLE>

                      PLAN OF DISTRIBUTION

     The Company will not receive any proceeds from the sale of
the Shares by the Selling Stockholders. The Shares may be sold
from time to time to purchasers directly by each Selling
Stockholder. Alternatively, each Selling Stockholder may sell its
Shares in one or more transactions (which may involve one or more
block transactions) on the Nasdaq National Market, in privately
negotiated transactions or otherwise, or in a combination of such
transactions; each sale may be made either at market prices
prevailing at the time of such sale or at negotiated prices; some
or all of the Shares may be sold through broker-dealers acting as
brokers or agents on behalf of each Selling Stockholder or to
broker-dealers acting as principals for resale by such dealers;
and in connection with such sales, such broker-dealers may
receive compensation in the form of commissions, discounts or
fees from each Selling Stockholder and/or the purchasers of such
Shares for whom they may act as broker or agent. However, neither
the Company nor either of the Selling Shareholders has entered
into any arrangements or underwriting agreements with any
broker-dealer or agent

                              -14-

<PAGE>                                         

relative to the Shares to be offered hereby. It is anticipated
that each Selling Stockholder will offer all of the Shares held
by it for sale. All expenses of registration incurred in
connection with this offering are being borne by the Company,
but all brokerage commissions and other similar expenses incurred
by each Selling Stockholder will be borne by such Selling Stockholder.

     At the time a particular offer of Shares is made, if and to
the extent required, a supplement to this Prospectus (the
"Prospectus Supplement") will be distributed that will identify
and set forth the aggregate amount of Shares being offered and
the terms of the offering, including the name or names of any
underwriters, dealers or agents, the purchase price paid by any
underwriter for Shares purchased from each Selling Stockholder,
any commissions, discounts and other items constituting
compensation from each Selling Stockholder and any commissions,
discounts or concessions allowed or reallowed or paid to dealers,
including the proposed selling price to the public.

     Each Selling Stockholder and any dealer acting in connection
with the offering of any of the Shares or any broker executing or
selling orders on behalf of that Selling Stockholder may be
deemed to be an "underwriter" within the meaning of the
Securities Act, in which event any profit on the sale of any or
all of the Shares and any commissions, discounts or concessions
received by any such dealers or brokers may be deemed to be
underwriting commissions and discounts under the Securities Act.
Any dealer or broker participating in any distribution of the
Shares may be required to deliver a copy of this Prospectus,
including the Prospectus Supplement, if any, to any person who
purchases any of the Shares from or through such dealer or
broker.

     Under applicable rules and regulations under the Exchange
Act, any person engaged in a distribution of the Shares may not
simultaneously engage in market making activities with respect to
the Shares for a period of nine business days prior to the
commencement of such distribution. Each Selling Stockholder will
be subject to applicable provisions of the Exchange Act and the
rules and regulations promulgated thereunder, including, without
limitation, Rules 10b-6 and 10b-7 of the Exchange Act, which
provisions may limit the timing of purchases and sales of the
Shares by such Selling Stockholder.

     In order to comply with certain states' securities laws, if
applicable, the Shares will be sold in such jurisdictions only
through registered or licensed brokers or dealers. In certain
states, the Shares may not be sold unless the Shares have been
registered and qualify for sale in such state, or unless an
exemption from registration or qualification is available and is
obtained.


                  DESCRIPTION OF CAPITAL STOCK

AUTHORIZED AND OUTSTANDING CAPITAL STOCK

     The authorized capital stock of the Company currently
consists of 50,000,000 shares of Common Stock, par value $.01 per
share, and 10,000,000 shares of preferred stock, par value $.01
per share (the "Preferred Stock"), which is subject to
designation and issuance by the Board in the future.  On April 8,
1997, there were 15,377,008 shares of Common Stock outstanding
and held of record by approximately 619 stockholders.  There are
currently no outstanding shares of Preferred Stock.  At April 8,
1997, there were a total of 2,753,277 shares of Common Stock
reserved for issuance upon the exercise of outstanding stock
options under the Company's employee stock option plan, director
options under the option plan for non-employee directors,
compensation contract options and the outstanding warrants of the
Selling Stockholders.

     The following descriptions of capital stock are qualified in
all respects by reference to the Company's Restated Certificate
of Incorporation.

                             -15-

<PAGE>

COMMON STOCK

     Holders of Common Stock are entitled to receive dividends
when, as and if declared by the Board from funds legally
available therefor.  Each share of Common Stock entitles the
holder thereof to one vote upon matters voted upon by the
stockholders.  Cumulative voting for the election of directors is
not permitted, which means that the holders of a majority of 
shares voting for the election of directors can elect all members
of each class of the Board.  Except as otherwise required by
applicable Delaware law, a majority vote is sufficient for any
action that requires the vote or concurrence of stockholders,
except that a plurality vote is sufficient to elect directors.

     The holders of Common Stock do not have any preemptive,
subscription, redemption or conversion rights or privileges. Upon
liquidation or dissolution of the Company, the holders of Common
Stock are entitled to share ratably in the net assets of the
Company remaining after payment of liabilities and liquidation
preferences of any outstanding shares of Preferred Stock.  All
shares of Common Stock now outstanding are, and the Shares of
Common Stock to be sold by the Selling Stockholders hereby will
be, upon issuance, fully paid and non-assessable.

PREFERRED STOCK

     The Preferred Stock may be issued from time to time by the
Board in one or more series, without further stockholder approval
or action, with such designations, powers, limitations,
restrictions, qualifications, rights, preferences and privileges
as the Board may determine.

TRANSFER AGENT

     The transfer agent and registrar for the Common Stock is
Montreal Trust Company of Canada, Vancouver, B.C., Canada.

INDEMNIFICATION

     The Company's Certificate provides that the Company shall
indemnify any and all persons who may serve or who have served at
any time as directors or officers, or who at the request of the
Board may serve or at any time have served as directors or
officers of another corporation in which the Company at such time
owned or may own shares of stock or of which the Company was or
may be a creditor, and their respective heirs, administrators,
successors and assigns, against any and all expenses, including
amounts paid upon judgments, attorneys' fees and amounts paid in
settlement (before or after suit is commenced), actually and
necessarily incurred by such persons in connection with the
defense or settlement of any claim, action, suit or proceeding in
which they, or any of them, are made parties, or a party, or
which may be asserted against them or any of them, by reason of
being or having been a director or officer of the Company, or of
such other corporation, except in relation to matters as to which
any such director or officer or former director or officer or
person is adjudged in any action, suit or proceeding to be liable
for his own negligence or misconduct in the performance of his
duties.  Such indemnification shall be in addition to any other
rights to which those indemnified may be entitled under any law,
bylaw, amendment, vote of stockholders or otherwise.

     Additionally, the Company shall, to the extent required, and
may, to the extent permitted, by Section 145 of the Delaware
General Corporation Law ("DGCL"), as amended from time to time,
indemnify and reimburse all persons whom it may indemnify and
reimburse pursuant thereto.  Expenses incurred by an officer or
director in defending a civil or criminal action, suit or
proceeding shall be paid by the Company in advance of the final
disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director or officer to repay
such amount if it shall ultimately be determined that he is not
entitled to be indemnified by the Company as authorized in
Section 145(e) of the DGCL.  The indemnification provided for in
the Certificate is not exclusive of any other rights to which
those entitled to receive indemnification or reimbursement
thereunder may be entitled.
                              -16-

<PAGE>

LIMITATION OF LIABILITY

     Section 102 of the DGCL authorizes a Delaware corporation to
include a provision in its certificate of incorporation limiting
or eliminating the personal liability of its directors to the
corporation and its stockholders for monetary damages for breach
of directors' fiduciary duty of care.  The duty of care requires
that, when acting on behalf of the corporation, directors exercise
an informed business judgment based on all material information 
reasonably available to them. Absent the limitations authorized by
such provision, directors are accountable to corporations and their
stockholders for monetary damages for conduct constituting gross 
negligence in the exercise of their duty of care.  Although Section
102 of the DGCL does not change a director's duty of care, it 
enables corporations to limit available relief to equitable remedies
such as injunction or rescission.  Pursuant to such provision, the 
Company adopted an amendment to its Certificate at the 1993 Annual 
Meeting of Stockholders limiting the personal liability of directors 
of the Company (in their capacity as directors but not in their 
capacity as officers) to the Company or its stockholders to the 
fullest extent permitted by the DGCL.  As a result, a director of the
Company may not be held personally liable to the Company or its
stockholders for monetary damages for breach of fiduciary duty as
a director, except for (i) any breach of the director's duty of
loyalty to the Company or its stockholders, (ii) acts or
omissions  not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) unlawful payments
of dividends or unlawful stock repurchases, redemptions or other
distributions, and (iv) any transaction from which the director
derived an improper personal benefit.

     The adoption of this provision may have the effect of
reducing the likelihood of derivative litigation against
directors and may discourage or deter stockholders or management
from bringing a lawsuit against directors for breach of their
duty of care, even though such an action, if successful, might
otherwise have benefitted the Company and its stockholders.
However, the adoption of this provision, together with the
provision described above that requires the Company to indemnify
its officers and directors against certain liabilities, is
intended to enable the Company to attract qualified persons to
serve as directors who might otherwise be reluctant to do so.

                         LEGAL MATTERS

     The validity of the Common Stock offered hereby will be
passed upon for the Company by Arter & Hadden, Dallas, Texas.

                              -17-

<PAGE>


=============================      ==============================
No  dealer,  salesperson  or
any  other  person  has been
authorized   to   give   any
information  or to  make any     
representations  other  than                225,000 SHARES
those  contained  in    this     
Prospectus   in   connection
with  the offer made by this
Prospectus, and, if given or     
made,  such  information  or           U.S. LONG DISTANCE CORP.
representations must not  be
relied  upon as having  been
authorized  by the  Company,
the Selling Stockholders  or
any   other   person.   This                 COMMON STOCK
Prospectus     does      not
constitute an offer to  sell
or  the solicitation of  any
offer  to  buy any  security
other  than  the  Shares  of
Common Stock offered by this
Prospectus,  nor   does   it
constitute an offer to  sell
or  a  solicitation  of  any
offer  to buy the Shares  of
Common  Stock by  anyone  in
any  jurisdiction  in  which
such  offer  or solicitation
is  not  authorized,  or  in
which the person making such
offer or solicitation is not
qualified  to do so,  or  to
any  person  to whom  it  is
unlawful to make such  offer
or solicitation. Neither the
delivery  of this Prospectus
nor  any sale made hereunder
shall,       under       any
circumstances,  create   any
implication that information
contained herein is  correct
as of any time subsequent to
the date hereof.
                                          ---------------
       ------------                          PROSPECTUS
                                          ---------------


      TABLE OF CONTENTS

                           Page

Available Information       2
Incorporation of
Certain Documents
  by Reference              2
Prospectus Summary          3
Risk Factors                5
Disclosure Regarding                      April ___, 1997
  Forward-Looking
  Statement                 7
The Company                 8
Use of Proceeds            13
Dilution                   13
Selling Stockholders       14
Plan of Distribution       14
Description of Capital
  Stock                    15
Legal Matters              17
=============================      ==============================

<PAGE>

                              PART II
             INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

SEC registration fee                                    $   771.31
NASD filing fee                                           4,500.00
Accounting fees and expenses                              2,000.00*
Legal fees and expenses (not including Blue Sky)          5,000.00*
Printing and engraving expenses                             500.00*
Registrar and transfer agent's fees                         400.00*
Blue Sky fees and expenses (including counsel fees)       1,000.00*
Miscellaneous expenses                                    1,000.00*
                                                        ----------
    Total                                               $15,171.31*
______________
* Estimated

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

     The section of the Prospectus entitled "Description of 
Capital Stock--Limitation of Liability" is incorporated herein by
reference.

     Section 145 of the Delaware General Corporation Law provides
broad authority for indemnification of officers and directors.
Article 10 of the Restated Certificate of Incorporation of the
Registrant provides for the indemnification of its officers and
directors to the extent permitted by such Section 145.

Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers or persons
controlling the Company pursuant to the foregoing provisions, the
Company has been informed that in the opinion of the Securities
and Exchange Commission, such indemnification is against public
policy as expressed in the Securities Act and is therefore
unenforceable.

The Registrant maintains directors' and officers' liability
insurance that covers the directors and officers of the Registrant
with policy limits of $10,000,000.
              

                              II-1

<PAGE>

ITEM 16. EXHIBITS.

     (a) Exhibits

     The exhibits listed below are filed as part of or incorporated
by reference in this Registration Statement.  Where such filing is
made by incorporation by reference to a previously filed report or
registration statement, such report or registration statement is
identified in parentheses.  See the Index of Exhibits included with
the exhibits filed as part of this Registration Statement.

Exhibit No.    Description
- -----------    -----------

   4.1         Amended Letter Agreement dated October 6, 1992, by
               and between Communications Central, Inc., U.S. Long
               Distance Corp. and U.S. Long Distance, Inc.
               (Exhibit 4.7 to Amendment No. 1 to Registration
               Statement on Form S-3, SEC File No. 33-71228, dated
               November 23, 1993) as amended by Letter Agreement
               dated January 11, 1995 (Exhibit 4.7 to September
               30, 1995, Form 10-K) and as amended by Letter
               Agreement dated August 21, 1996 (Exhibit 4.2 to
               September 30, 1996, Form 10-K)
     
   4.2         Agreement dated March 23, 1993 by and between
               Paytel Northwest, Inc., U.S. Long Distance Corp.
               and U.S. Long Distance, Inc., as amended by
               Agreement dated August 23, 1995 (Exhibit 4.8 to
               September 30, 1995, Form 10-K) and as amended by
               Addendum No. 3 to Telecommunications Services
               Agreement dated February 22, 1996 (Exhibit 4.3 to
               September 30, 1996, Form 10-K)

   5.1         Opinion of Arter & Hadden (including the consent of
               such firm) as to the validity of securities being
               offered (filed herewith)

   23.1        Consent of Arter & Hadden (included as part of its
               opinion filed as Exhibit 5.1 hereto)

   23.2        Consent of Arthur Andersen LLP (filed herewith)

   24.1        Power of Attorney (included on Signature Page,
               II-5, hereto)

                              II-2

<PAGE>

ITEM 17. UNDERTAKINGS.

     (a)  Rule 415 Offering. The undersigned Registrant hereby
undertakes:

          (1)  To file, during any period in which offers or sales
     are being made, a post-effective amendment to this
     registration statement:

               (i)  to include any prospectus required by  Section
          10(a)(3) of the Securities Act;

               (ii)      to reflect in the prospectus any facts or
          events arising after the effective date of the
          Registration Statement (or the most recent post-effective
          amendment thereof) which, individually or in the
          aggregate, represent a fundamental change in the
          information set forth in the Registration Statement.
          Notwithstanding the foregoing, any increase or decrease
          in volume of securities offered (if the total dollar
          value of securities offered would not exceed that which
          was registered) and any deviation from the low or high
          end of the estimated maximum offering range may be
          reflected in the form of prospectus filed with the
          Commission pursuant to Rule 424(b) if, in the aggregate,
          the changes in volume and price represent no more than a
          20% change in the maximum aggregate offering price set
          forth in the "Calculation of Registration Fee" table in
          the effective Registration Statement;

               (iii)     to include any material information with
          respect to the plan of distribution not previously
          disclosed in the Registration Statement or any material
          change to such information in the Registration Statement.

     Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do
     not apply if the Registration Statement is on Form S-3, Form
     S-8 or Form F-3, and the information required to be included
     in a post-effective amendment by those paragraphs is contained
     in periodic reports filed with or furnished to the Commission
     by the Registrant pursuant to Section 13 or Section 15(d) of
     the Exchange Act that are incorporated by reference in the
     Registration Statement.

          (2)  That, for the purpose of determining any liability
     under the Securities Act, each such post-effective amendment
     shall be deemed to be a new registration statement relating to
     the securities offered therein, and the offering of such
     securities at that time shall be deemed to be the initial bona
     fide offering thereof.

          (3)  To remove from registration by means of a
     post-effective amendment any of the securities being
     registered which remain unsold at the termination of the
     offering.

     (b)  Filings incorporating subsequent Exchange Act documents
by reference. The undersigned Registrant hereby undertakes that,
for purposes of determining any liability under the Securities Act,
each filing of the Registrant's annual report pursuant to Section
13(a) or 15(d) of the Exchange Act (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Exchange Act) that is incorporated by
reference in the Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.

     (h)  Request for acceleration of effective date. Insofar as
indemnification for liabilities arising under the Securities Act 
may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the Company's Restated Certificate of
Incorporation, Bylaws, both as amended, or otherwise, the
Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification
against 
                              II-3

<PAGE>

such liabilities (other than the payment by the Registrant of
expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final adjudication
of such issue.

     (i)  Rule 430A. The undersigned Registrant hereby undertakes
that:

          (1)  For purposes of determining any liability under the
Securities Act, the information omitted from the form of prospectus
filed as part of this Registration Statement in reliance upon Rule
430A and contained in a form of prospectus filed by the Registrant
pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities
Act shall be deemed to be part of this Registration Statement as of
the time it was declared effective.

          (2)  For the purpose of determining any liability under
the Securities Act, each post-effective amendment that contains a
form of prospectus shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.

                              II-4

<PAGE>

                           SIGNATURES

     Pursuant to the requirements of the Securities Act of 1933,
the Registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form
S-3 and has duly caused this Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in
the City of San Antonio, State of Texas, on the 11th day of
April, 1997.

                                   U.S. LONG DISTANCE CORP.

                                   By:  /s/ Larry M. James
                                        -------------------------
                                        Larry M. James
                                        Chief Executive Officer and
                                        President

                       POWER OF ATTORNEY

     KNOW ALL MEN BY THESE PRESENTS, that the undersigned
officers and directors of U.S. LONG DISTANCE CORP., a Delaware
corporation, which is filing a Registration Statement on Form S-3
with the Securities and Exchange Commission, Washington, D.C.
20549 under the provisions of the Securities Act of 1933, as
amended (the "Securities Act"), hereby constitute and appoint
LARRY M. JAMES, W. AUDIE LONG and PHILLIP J. STORIN, and each of
them, his true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities, to sign such
Registration Statement and any and all amendments, including post-
effective amendments, to the Registration Statement, including a
Prospectus or an amended Prospectus therein and in any
registration statement for the same offering that is to be
effective upon filing pursuant to Rule 462(b) under the
Securities Act and all other documents in connection therewith to
be filed with the Securities and Exchange Commission, granting
unto said attorneys-in-fact and agents, and each of them, full
power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact as agents or any of them, or their substitute
or substitutes, may lawfully do or cause to be done by virtue
hereof.

     Pursuant to the requirements of the Securities Act, this
Registration Statement has been signed on the 11th day of April,
1997, by the following persons in the capacities indicated:

Signatures                         Title

/s/ Parris H. Holmes, Jr.      Chairman of the Board of Directors
- -------------------------
Parris H. Holmes, Jr.

/s/ Larry M. James
- -------------------------       Chief Executive Officer, 
Larry M. James                  President and Director
                                (Principal Executive Officer)

/s/ Phillip J. Storin           Senior Vice President, Chief
- -------------------------       Financial Officer and
 Phillip J. Storin              Corporate Treasurer
                                (Principal Financial and
                                   Accounting Officer)

- -------------------------        Director
Charles E. Amato

/s/ Gary D. Becker
- -------------------------         Director
Gary D. Becker

/s/ F. Gardner Parker
- -------------------------         Director
F. Gardner Parker

                                II-5

<PAGE>

                       INDEX TO EXHIBITS

Exhibit No.         Description
- ----------          -----------


  4.1               Amended Letter Agreement dated October 6,
                    1992, by and between Communications Central,
                    Inc., U.S. Long Distance Corp. and U.S. Long
                    Distance, Inc. (Exhibit 4.7 to Amendment No. 1
                    to Registration Statement on Form S-3, SEC
                    File No. 33-71228, dated November 23, 1993) as
                    amended by Letter Agreement dated January 11,
                    1995 (Exhibit 4.7 to September 30, 1995, Form
                    10-K) and as amended by Letter Agreement dated
                    August 21, 1996 (Exhibit 4.2 to September 30,
                    1996, Form 10-K)

  4.2               Agreement dated March 23, 1993 by and between 
                    Paytel Northwest, Inc., U.S. Long Distance
                    Corp. and U.S. Long Distance, Inc., as amended
                    by Agreement dated August 23, 1995 (Exhibit
                    4.8 to September 30, 1995, Form 10-K) and as
                    amended by Addendum No. 3 to
                    Telecommunications Services Agreement dated
                    February 22, 1996 (Exhibit 4.3 to September
                    30, 1996, Form 10-K)

  5.1               Opinion of Arter & Hadden (including the
                    consent of such firm) as to the legality of 
                    securities being offered (filed herewith)

  23.1              Consent of Arter & Hadden (included as part of
                    its opinion filed as Exhibit 5.1 hereto)

  23.2              Consent of Arthur Andersen LLP (filed
                    herewith)

  24.1              Power of Attorney (included on Signature Page,
                    II-5 hereto)





                                                 Exhibit 5.1

                         ARTER & HADDEN
                  1717 Main Street, Suite 4100
                       Dallas, Texas 75201
                       Tel: (214) 761-2100
                       Fax: (214) 741-7139

                         April 11, 1997


U.S. Long Distance Corp.
9311 San Pedro, Suite 100
San Antonio, Texas  78216

      Re: U.S. Long Distance Corp. - Registration Statement on Form S-3

Gentlemen:

      We  have  acted as counsel to U.S. Long Distance  Corp.,  a
Delaware  corporation  (the "Company"), in  connection  with  the
preparation  of  the  Registration Statement  on  Form  S-3  (the
Registration  Statement") to be filed  with  the  Securities  and
Exchange  Commission  on  or  about April  11,  1997,  under  the
Securities  Act  of  1933,  as amended  (the  "Securities  Act"),
relating  to 225,000 shares of common stock, $0.01 par value  per
share,  of  the Company (the "Common Stock") that may  be  issued
from  time  to  time  upon  the exercise of  certain  outstanding
warrants (collectively, the "Warrants") granted pursuant  to  the
terms   of   two  telecommunications  services  agreements   (the
"Agreements").

      You have requested the opinion of this firm with respect to
certain   legal  aspects  of  the  Registration  Statement.    In
connection  therewith,  we  have examined  and  relied  upon  the
original,  or copies identified to our satisfaction, of  (1)  the
Restated  Certificate of Incorporation and the  Bylaws,  both  as
amended, of the Company; (2) minutes and records of the corporate
proceedings  of  the  Company  with  respect  to  the  execution,
delivery  and  amendment of the Agreements, the granting  of  the
Warrants  pursuant to the Agreements, the issuance of  shares  of
Common  Stock  in accordance with the terms of the  Warrants  and
certain  related  matters;  (3) the  Registration  Statement  and
exhibits thereto, including the Agreements listed as exhibits  to
the  Registration  Statement; and (4) such  other  documents  and
instruments as we have deemed necessary for the expression of the
opinions herein contained.  In making the foregoing examinations,
we  have  assumed  the  genuineness of  all  signatures  and  the
authenticity  of all documents submitted to us as originals,  and
the  conformity to original documents of all documents  submitted
to  us  as  certified  or  photostatic  copies.   As  to  various
questions of fact material to this opinion, and as to the content
and  form  of  the  Restated Certificate  of  Incorporation,  the
Bylaws,  minutes,  records, resolutions and  other  documents  or
writings  of the Company, we have relied, to the extent  we  deem
reasonably  appropriate, upon representations or certificates  of
officers and directors of the Company and upon documents, records
and   instruments  furnished  to  us  by  the  Company,   without
independent check or verification of their accuracy.

<PAGE>

      Based  upon our examination, consideration of, and reliance
on  the  documents and other matters described above, and subject
to the comments and exceptions noted below, we are of the opinion
that,  assuming (i) the Warrants were granted in accordance  with
the  terms  of  the  Agreements, (ii) the  Company  maintains  an
adequate number of authorized but unissued shares and/or treasury
shares  of  Common Stock available for issuance to those  persons
who  exercise the Warrants, and (iii) the consideration  for  the
shares  of  Common  Stock  issuable upon  the  exercise  of  such
Warrants is actually received by the Company as provided  in  the
Agreements  and  the  respective Warrants and such  consideration
exceeds  the par value of such shares, then the shares of  Common
Stock  issued  pursuant to the exercise of the  Warrants  granted
under and in accordance with the terms of the Agreements will  be
duly and validly issued, fully paid and nonassessable.

      We bring to your attention the fact that our legal opinions
are an expression of professional judgment and not guaranties  of
result.  This opinion is rendered as of the date hereof,  and  we
undertake  no, and hereby disclaim any, obligation to advise  you
of  any  changes  in or new developments that  might  affect  any
matters or opinions set forth herein.

      This  opinion  is limited in all respects  to  the  General
Corporation Law of the State of Delaware as in effect on the date
hereof;  however, we are not members of the Bar of the  State  of
Delaware  and  our  knowledge of its General Corporation  Law  is
derived  from  a reading of the most recent compilation  of  that
statute available to us without consideration of any judicial  or
administrative interpretations thereof.

      We  hereby  consent  to the filing of this  opinion  as  an
exhibit  to the Registration Statement and to references  to  our
firm  included  in or made a part of the Registration  Statement.
In  giving this consent, we do not admit that we come within  the
category of person whose consent is required under Section  7  of
the Securities Act or the Rules and Regulations of the Securities
and Exchange Commission thereunder.

                                   Very truly yours,

                                   /s/  Arter & Hadden

                                   ARTER & HADDEN



                                                     EXHIBIT 23.2


            CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
                                
                                
                                
                                
As independent public accountants, we hereby consent to the
incorporation by reference in this Registration Statement of our
reports dated November 14, 1996, included in the U.S. Long
Distance Corp.'s Form 10-K for the year ended September 30, 1996
and to all references to our firm, included in this Registration
Statement.


                                   Arthur Andersen LLP


San Antonio, Texas
April 9, 1997



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