Interstate Gen: Other News Release

                                 
                            News Release
     
     
     FOR IMMEDIATE RELEASE                             CONTACT
     December 24, 1997                                 Edwin L. Kelly
                                                       (301) 843-8600
     
     
            APPEALS COURT OVERTURNS WETLANDS CONVICTIONS
                         OF IGC AND ITS CEO
                                  
                                  
          ST. CHARLES, Md._ Interstate General Company L.P. (AMEX,

     PSE: IGC), a diversified real estate organization, announced

     today that the United States Court of Appeals for the Fourth

     Circuit reversed the 1996 wetlands convictions of the Company,

     its affiliate, St. Charles Associates, and its Chief Executive

     Officer, James J. Wilson.  The Court's action eliminates the $3

     million fine and remediation obligations that had been imposed

     as part of the company's criminal sentence.

          IGC President and Chief Operating Officer, Edwin Kelly

     stated, "We are obviously pleased with the Court's decision.

     Throughout our 25 years of developing St. Charles, it has

     always been our intention to operate consistent with the

     highest environmental standards and in conformity with all

     federal, state and local requirements.  We look forward to the

     opportunity to continue to serve the St. Charles community."

          In reversing the convictions, the Court invalidated

     regulations that define "waters of the United States" to

     include intrastate, nonnavigable waters that could affect

     interstate commerce.  Rather the court held the Clean Water Act

     does not extend to wetlands that are not connected closely to

     either interstate or navigable waters.  The Court also found

     that the trial court had admitted impermissible testimony and had failed
     
     to instruct the jury that it must find that defendants had knowledge of

     each essential element of the alleged violation of the Clean Water

     Act.

          The Court's decision leaves open the possibility of a new

     trial.  The Government has not indicated whether it will seek

     to retry the case.

          Located approximately 20 miles southeast of Washington,

     D.C., St. Charles features a variety of land uses including

     residential, recreation, commercial and business parks.

     Since it began developing the community in 1972, IGC has

     preserved more than 20 percent of each village as open

     space.

          Founded in 1957, IGC specializes in community

     development, homebuilding, investment apartment properties

     and asset management services.

                                  
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