FORM 10-Q
                              
                        UNITED STATES
             SECURITIES AND EXCHANGE COMMISSION
                    WASHINGTON, D.C. 20549

(Mark One)

[  X  ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)  OF
        THE SECURITIES EXCHANGE ACT OF 1934

        For the quarterly period ended March 31, 1999

                           - OR -

[   ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)  OF
       THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______________ to ________________

                Commission file number 1-6075
                              
                  UNION PACIFIC CORPORATION
   (Exact name of registrant as specified in its charter)
    
            UTAH                               13-2626465
(State or other jurisdiction of             (I.R.S. Employer
 incorporation or organization)           Identification No.)

          1717 MAIN STREET, SUITE 5900, DALLAS, TX
          (Address of principal executive offices)

                            75201
                         (Zip Code)

                       (214) 743-5600
    (Registrant's telephone number, including area code)

    Indicate  by check mark whether the Registrant  (1)  has
filed  all  reports required to be filed by  Section  13  or
15(d)  of  the  Securities Exchange Act of 1934  during  the
preceding  12  months (or for such shorter period  that  the
Registrant was required to file such reports), and  (2)  has
been  subject to such filing requirements for  the  past  90
days.

YES    X        NO
    ______         ______

    As  of April 30, 1999, there were 247,732,651 shares  of
the Registrant's Common Stock outstanding.

                  UNION PACIFIC CORPORATION
                            INDEX

               PART I.  FINANCIAL INFORMATION

                                                 Page Number
Item 1:  Consolidated Financial Statements:
       
       STATEMENT OF CONSOLIDATED INCOME
       For the Three Months Ended 
       March 31, 1999 and 1998.....................    1

       STATEMENT OF CONSOLIDATED FINANCIAL POSITION
       At March 31, 1999 and December 31, 1998.....    2

       STATEMENT OF CONSOLIDATED CASH FLOWS
       For the Three Months Ended 
       March 31, 1999 and 1998.....................    3

       STATEMENT OF CHANGES IN COMMON 
       STOCKHOLDERS' EQUITY
       For the Three Months Ended March 31, 1999...    4

       NOTES TO CONSOLIDATED FINANCIAL 
       STATEMENTS..................................   5-11

Item 2:  Management's Discussion and Analysis of 
         Financial Condition and Results of 
         Operations................................  12-19

Item 3:  Quantitative and Qualitative Disclosures 
         About Market Risk.........................    19

                 PART II.  OTHER INFORMATION

Item 1:  Legal Proceedings.........................   19-20

Item 4:  Submission of Matters to a Vote of 
         Security Holders..........................     20
                                                    
Item 6:  Exhibits and Reports on Form 8-K..........     21

Signature..........................................     22

 1

PART I - FINANCIAL INFORMATION

Item 1.  Consolidated Financial Statements
- -------------------------------------------------------------------------

Statement of Consolidated Income (Unaudited)
Union Pacific Corporation and Subsidiary Companies
For the Three Months Ended March 31, 1999 and 1998
- -------------------------------------------------------------------------
               Millions, Except Per Share and Ratios      1999     1998
- -------------------------------------------------------------------------
                                                        
Operating Revenues     Rail and other (Note  2)......  $2,740    $2,586
- -------------------------------------------------------------------------
Operating Expenses     Salaries, wages and employee 
                          benefits...................   1,076     1,078
                       Equipment and other rents.....     331       382
                       Depreciation (Note 5).........     270       263
                       Fuel and utilities (Note 4)...     189       221
                       Materials and supplies........     144       144
                       Casualty costs................     111       117
                       Other costs (Note 10).........     257       348
                       --------------------------------------------------
                       Total.........................   2,378     2,553
                       --------------------------------------------------
Income                 Operating Income..............     362        33
                       Other income (Note 8).........      31        23
                       Interest expense (Note 4).....    (192)     (161)
                       --------------------------------------------------
                       Income (Loss) before Income  
                          Taxes......................     201      (105)
                       Income taxes..................     (72)       43
                       --------------------------------------------------
                       Net Income (Loss).............  $  129    $  (62)
- -------------------------------------------------------------------------
Earnings Per Share     Basic - Net Income (Loss).....  $ 0.52    $(0.25)
(Note  7)              Diluted - Net Income (Loss)...  $ 0.52    $(0.25)
                       --------------------------------------------------
                       Weighted Average Number of 
                          Shares (Basic).............   246.3     246.0
                       Weighted Average Number of 
                          Shares (Diluted)...........   247.4     246.0
                       --------------------------------------------------
                       Cash Dividends Per Share......  $ 0.20    $ 0.20
                       --------------------------------------------------
                       Ratio of Earnings to Fixed 
                          Charges (Note  9)..........     1.8       0.4

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

 2

- ------------------------------------------------------------------------- 

Statement of Consolidated Financial Position (Unaudited)
Union Pacific Corporation and Subsidiary Companies
- ------------------------------------------------------------------------- 
                                                     March 31,  Dec. 31,
               Millions of Dollars                        1999      1998
- ------------------------------------------------------------------------- 
Assets
                       -------------------------------------------------- 
                                                        
Current Assets         Cash and temporary investments. $   107   $  176
                       Accounts receivable (Note 4)...     632      643
                       Inventories....................     350      343
                       Current deferred tax asset.....     245      244
                       Other current assets...........     102       96
                       --------------------------------------------------
                       Total..........................   1,436    1,502

Investments (Note 3)   Investments in and advances to
                          affiliated companies........     618      520
                       Other investments..............     137      171
                       --------------------------------------------------
                       Total..........................     755      691
                       --------------------------------------------------
Properties (Note 5)    Cost...........................  33,470   33,145
                       Accumulated depreciation.......  (6,428)  (6,206)
                       --------------------------------------------------
                       Net............................  27,042   26,939
                       --------------------------------------------------
Other                  Other assets...................     222      242
                       --------------------------------------------------
                       Total Assets................... $29,455  $29,374
- -------------------------------------------------------------------------
Liabilities and Stockholders' Equity
                       --------------------------------------------------
Current Liabilities    Accounts payable............... $   584  $   586
                       Accrued wages and vacation 
                          payable.....................     470      410
                       Accrued casualty costs.........     388      400
                       Income and other taxes payable.     299      301
                       Dividends and interest payable.     279      289
                       Debt due within one year 
                          (Note 6)....................     180      181
                       Other current liabilities 
                          (Note 3)....................     739      765
                       --------------------------------------------------
                       Total..........................   2,939    2,932
                       --------------------------------------------------
Other Liabilities and  Debt due after one year 
Stockholder's Equity      (Note  6)...................   8,539    8,511
                       Deferred income taxes..........   6,370    6,308
                       Accrued casualty costs.........   1,058      995
                       Retiree benefit obligations....     816      803
                       Other long-term liabilities 
                          (Notes 3 and 10)............     755      932
                       Company-Obligated Mandatorily 
                          Redeemable Convertible 
                          Preferred Securities 
                          (Note  6)...................   1,500    1,500
                       Common stockholders'equity
                          (Page 4)....................   7,478    7,393
                       --------------------------------------------------
                       Total Liabilities and 
                          Stockholders' Equity........ $29,455  $29,374

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

 3

- -------------------------------------------------------------------------

Statement of Consolidated Cash Flows (Unaudited)
Union Pacific Corporation and Subsidiary Companies
For the Three Months Ended March 31, 1999 and 1998
- -------------------------------------------------------------------------
                       Millions of Dollars                1999     1998
- -------------------------------------------------------------------------
                                                       
Cash from Operations   Net Income (Loss).............. $   129  $   (62)
                       Non-cash charges to income:
                          Depreciation................     270      263
                          Deferred income taxes.......      60      (29)
                          Other - net.................     (50)      18
                       Changes in current assets and 
                          liabilities.................       4     (307)
                       --------------------------------------------------
                       Cash Provided by (Used in) 
                          Operations..................     413     (117)
                       --------------------------------------------------
Investing Activities   Capital investments............    (372)    (531)
                       Other - net (Note 3)...........     (90)     (22)
                       --------------------------------------------------
                       Cash Used in Investing 
                          Activities..................    (462)    (553)
                       --------------------------------------------------
Equity and Financing   Dividends paid.................     (49)    (106)
Activities (Note 6)    Debt repaid....................    (369)    (888)
                       Net financings.................     398    1,766
                       Other - net....................       -       (1)
                       --------------------------------------------------
                       Cash Provided by (Used in) Equity 
                         and Financing Activities.....     (20)     771
                       --------------------------------------------------
                       Net Change in Cash and Temporary 
                          Investments................. $   (69) $   101
                       Cash at Beginning of Period....     176       90
                       --------------------------------------------------
                       Cash at End of Period.......... $   107  $   191
- -------------------------------------------------------------------------
Change in Current      Accounts receivable............ $    11  $    23
Assets and Liabilities Inventories....................      (7)     (13)
                       Other current assets...........      (7)     102
                       Accounts, wages and vacation 
                          payable.....................      58     (218)
                       Debt due within one year 
                          (Note 6)....................      (1)    (100)
                       Other current liabilities......     (50)    (101)
                       --------------------------------------------------
                       Total.......................... $     4  $  (307)
- -------------------------------------------------------------------------

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

 4

- -------------------------------------------------------------------------

Statement of Changes in Common Stockholders' Equity (Unaudited)
Union Pacific Corporation and Subsidiary Companies
For the Three Months Ended March 31, 1999
- -------------------------------------------------------------------------
                       Millions of Dollars                         1999
- -------------------------------------------------------------------------
                                                          
Common Stock           Common stock, $2.50 par value
                          (authorized 500,000,000 shares)

                       Balance at beginning of 
                          period (276,335,423 
                          shares issued)...................     $   691
                       --------------------------------------------------
                       Conversions, exercises of stock options  
                          and retention stock forfeitures 
                          for the period (27,543 net shares 
                          forfeited).......................           -
                       --------------------------------------------------
                       Balance at end of period
                       (276,307,880 shares issued).........         691
                       --------------------------------------------------
Paid-in Surplus        Balance at beginning of period......       4,053
                       Conversions, exercises of stock 
                          options and forfeitures..........          (6)
                       --------------------------------------------------
                       Balance at end of period............       4,047
                       --------------------------------------------------
Retained Earnings      Balance at beginning of period......       4,441
                       Net Income..........................         129
                       --------------------------------------------------
                       Total...............................       4,570
                       Cash dividends declared  
                          ($0.20 per share)................         (49)
                       --------------------------------------------------
                       Balance at end of period............       4,521
                       --------------------------------------------------
Treasury Stock         Balance at March 31, at cost
                          (28,711,253 shares)..............      (1,781)
                       --------------------------------------------------
                       Total Common Stockholders' Equity...     $ 7,478
- -------------------------------------------------------------------------

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

 5

    UNION PACIFIC CORPORATION AND CONSOLIDATED SUBSIDIARY
                          COMPANIES
                              
         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
         ------------------------------------------
                              
                         (Unaudited)
                              
1.   Responsibilities for Financial Statements - The consolidated 
     financial statements are unaudited and reflect all adjustments 
     (consisting only of normal and recurring adjustments) that are,  
     in the opinion of management, necessary for a fair presentation 
     of the financial position and operating results for the interim 
     periods presented. The Statement of Consolidated Financial 
     Position at December 31, 1998 is derived from audited financial 
     statements.  The consolidated financial statements should be 
     read in conjunction with the consolidated financial statements 
     and notes thereto contained in the Union Pacific Corporation (the  
     Corporation or UPC) Annual Report to Shareholders incorporated 
     by reference in the Corporation's Annual Report on Form 10-K 
     for the year ended December 31, 1998.   The results of operations 
     for the three months ended March 31, 1999 are not necessarily 
     indicative of the results for the entire year ending December 
     31, 1999.  Certain 1998 amounts have been reclassified to conform 
     to the 1999 financial statement presentation.

2.   Segmentation - UPC consists of one reportable segment, rail 
     transportation (Rail), and UPC's other product lines (Other 
     Operations). The Rail segment includes the operations of Union 
     Pacific Railroad Company (UPRR), its subsidiaries and rail 
     affiliates (collectively, the Railroad).  Other Operations  
     include the trucking product line (Overnite Transportation 
     Company), as well as technology and insurance product lines, 
     and corporate holding company operations, which largely support 
     the Rail segment, and all appropriate consolidating entries.

          The following tables detail reportable financial information  
     for UPC's Rail segment and Other Operations for the three months 
     ended March 31, 1999 and 1998, respectively:

     March 31, 1999            Rail   Other Operations [a]    Consolidated
                                      --------------------
     Millions of Dollars              Trucking   Other [b]
     ---------------------------------------------------------------------
                                                      
     Net sales and revenues   
        from external 
        customers [c].......  $ 2,479   $  253      $  8          $ 2,740
     Net income (loss)......      149        9       (29)             129
     Assets.................   28,533      845        77           29,455
     --------------------------------------------------------------------
     
     March 31, 1999            Rail   Other Operations [a]    Consolidated
                                      --------------------
     Millions of Dollars              Trucking   Other [b]
     ---------------------------------------------------------------------
                                                       
     Net sales and revenues   
        from external 
        customers [c].......  $ 2,284   $  257      $ 45          $ 2,586
     Net income (loss)......      (32)       5       (35)             (62)
     Assets.................   27,595    1,366       233           29,194
     ---------------------------------------------------------------------
   
     [a]  "Other Operations" includes all product lines that are not 
     significant enough to warrant reportable segment classification.

     [b] Included in the "Other" product line are the results of the   
     corporate holding company, Union Pacific Technologies, a provider  
     of transportation-related technologies, Wasatch Insurance Limited,  
     a captive insurance company, and all necessary consolidating entries.

     [c] The Corporation does not have significant intercompany sales 
     activities.

 6

3.   Acquisitions
  
     Southern Pacific Rail Corporation (Southern Pacific or SP) - UPC 
     consummated the acquisition of Southern Pacific in September 1996.  
     The acquisition of SP was accounted for as a purchase and was fully 
     consolidated into UPC's results beginning in October 1996.
  
     Merger Consolidation Activities - In connection with the acquisition  
     and continuing integration of UPRR and Southern Pacific's rail 
     operations, UPC is in the process of eliminating 5,200 duplicate  
     positions, which are primarily employees involved in activities other  
     than train, engine and yard activities. In addition, UPC is relocating  
     4,700 positions, merging or disposing of redundant facilities, and  
     disposing of certain rail lines. The Corporation is also canceling 
     uneconomical and duplicative SP contracts.
  
          To  date, UPC has severed 2,450 employees and relocated 3,900  
     employees due to merger implementation activities.  UPC recognized a 
     $958 million pre-tax liability as part of the SP purchase price 
     allocation for costs associated with SP's portion of these activities.  
     In addition, the Railroad expects to incur $160 million in pre-tax 
     acquisition-related costs for severing or relocating UPRR employees,  
     disposing of certain UPRR facilities, and training and equipment  
     upgrading over the merger implementation period.  Earnings for the  
     three months ended March 31, 1999 and 1998 included $9 million and  
     $18 million after-tax, respectively, for acquisition-related costs 
     for UPRR consolidation activities.
  
          The components of the merger liability as of March 31, 1999 
     were as follows:

     --------------------------------------------------------------------- 
                                         Original   Cumulative    Current
        Millions of Dollars               Reserve    Activity     Reserve
     ---------------------------------------------------------------------
                                                            
     Contractual obligations..............  $361        $361         $  -
     Severance costs......................   343         257           86
     Contract cancellation fees and 
        facility and line closure costs...   145         125           20
     Relocation costs.....................   109          81           28
     ---------------------------------------------------------------------
     Total................................  $958        $824         $134
     ---------------------------------------------------------------------

     Merger Liabilities - Merger liability activity reflected cash payments  
     for merger consolidation activities and reclassifications of contractual 
     obligations from merger liabilities to contractual liabilities. The  
     Corporation expects that the remaining merger payments will be made over   
     the course of the next three years as labor negotiations are completed 
     and implemented and related merger consolidation activities are finalized.
  
     Mexican Railway Concession - During 1997, UPRR and a consortium of 
     partners were granted a 50-year concession to operate the Pacific-North 
     and Chihuahua Pacific lines in Mexico and a 25% stake in the Mexico City  
     Terminal Company at a price of $525 million.  The consortium assumed  
     operational control of both lines in 1998.   In March  1999, the Railroad 
     purchased an additional 13% ownership interest for $87 million from one  
     of its partners.   The  Railroad now holds a 26% ownership share in the 
     consortium.  The investment is accounted for under the equity method.

 7
  
4.   Financial Instruments - The Corporation and its subsidiaries use 
     derivative financial instruments in limited instances and for other 
     than trading purposes to manage risk as it relates to fuel prices and  
     interest rates.  Where the Corporation has fixed interest rates  or fuel  
     prices through the use of swaps, futures or forward contracts, the 
     Corporation has mitigated the downside risk of adverse price and rate 
     movements; however, it has also limited future gains from favorable 
     movements.

     Credit  Risk - The total credit risk associated with the Corporation's 
     counterparties was $63 million at March 31, 1999.  The Corporation has 
     not been required to provide collateral; however, UPC has received 
     collateral relating to its hedging activity where the concentration of 
     credit risk was substantial.
  
     Valuation - The fair market values of the Corporation's derivative  
     financial instrument positions at March 31, 1999 and December 31, 1998 
     were determined based upon current fair market values as quoted by 
     recognized dealers or developed based upon the present value of future  
     cash flows discounted at the applicable  U.S. Treasury rate and swap 
     spread.
  
          The following is a summary of the Corporation's financial instruments 
     at March 31, 1999 and December 31, 1998:

     -------------------------------------------------------------------------
     Millions of Dollars                              March 31,   December 31,
     Except Percentages and Average Commodity Prices       1999          1998
     -------------------------------------------------------------------------
                                                                  
     Interest Rate Hedging:                           
         Amount of debt hedged......................      $ 150         $ 150
         Percentage of total debt portfolio.........          2             2
     Rail Fuel Hedging:                                      
         Fuel purchases hedged for 1999.............      $ 257         $ 343
         Percentage of forecasted 1999 fuel
              consumption hedged....................         64            64
         Average price of 1999 hedges outstanding     
              (per gallon) [a]......................      $0.41         $0.41
         Fuel purchases hedged for 2000.............      $  54             -
         Percentage of forecasted 2000 fuel       
              consumption hedged....................         12             -
         Average price of 2000 hedges outstanding     
              (per gallon) [a]......................      $0.39             -
     Trucking Fuel Hedging:                                  
              Fuel purchases hedged for 1999........      $   8         $  10
         Percentage of forecasted 1999 fuel       
              consumption hedged....................         40            41
         Average price of 1999 hedges outstanding 
             (per gallon) [a].......................      $0.45         $0.45
         Fuel purchases hedged for 2000.............      $   2             -
         Percentage of forecasted 2000 fuel 
              consumption hedged....................         38             -
         Average price of 2000 hedges outstanding 
              (per gallon) [a]......................      $0.39             -
     -------------------------------------------------------------------------

     [a]  Excludes taxes and transportation costs.

 8

          The asset and liability positions of the Corporation's outstanding 
     financial instruments at March 31, 1999 and December 31, 1998 were as 
     follows:

     ------------------------------------------------------------------------
                                                    March 31,   December 31,
     Millions of Dollars                                 1999           1998
     ------------------------------------------------------------------------
                                                                  
     Interest Rate Hedging:                           
          Gross fair market asset position                $46           $ 41
          Gross fair market (liability) position           (9)            (5)
     Rail Fuel Hedging:                                       
          Gross fair market asset position                 17              -
          Gross fair market (liability) position            -            (49)
     Trucking Fuel Hedging:                                   
          Gross fair market asset position                  -              -
          Gross fair market (liability) position            -             (2)
     ------------------------------------------------------------------------
     Total asset (liability) position                     $54           $(15)
     ------------------------------------------------------------------------

          The Corporation's use of financial instruments had the following 
     impact on pre-tax income for the quarters ended March 31, 1999 and 1998:

     ------------------------------------------------------------------------
                                                        March 31,  March 31,
     Millions of Dollars                                     1999       1998
     ------------------------------------------------------------------------
                                                                  
     Increase in interest expense from interest 
          rate hedging..................................    $  -        $  1
     Increase in fuel expense from Rail fuel hedging....      19          14
     Increase in fuel expense from trucking fuel 
          hedging.......................................       1           1
     ------------------------------------------------------------------------
     Reduction in Pre-Tax Income........................     $20         $16
     ------------------------------------------------------------------------

     Sale  of  Receivables  -  The  Railroad  has  sold,  on  a revolving   
     basis,   an  undivided  percentage   ownership interest  in  a designated 
     pool of accounts receivable  to third parties through a bankruptcy-remote 
     subsidiary  (the Subsidiary).  The Subsidiary is collateralized  by  a  
     $76 million  note  from UPRR.  The amount of receivables  sold fluctuates  
     based upon the availability of the  designated pool  of  receivables and 
     is directly affected by changing business  volumes and credit risks. At 
     March 31, 1999  and December  31, 1998, accounts receivable are presented  
     net of $580 million of receivables sold.

5.   Properties - Major property accounts were as follows:

     ------------------------------------------------------------------------
                                              March 31,        December 31,
     Millions of Dollars                           1999                1998
     ------------------------------------------------------------------------
                                                              
     Rail                                                    
         Land and other property.............   $ 5,000             $ 4,992
         Track, structures and facilities....    20,065              19,803
         Locomotives.........................     4,480               4,486
         Freight cars........................     2,583               2,536
         Other equipment.....................       528                 517
     ------------------------------------------------------------------------ 
     Total Rail..............................    32,656              32,334
     Trucking................................       785                 785
     Other...................................        29                  26
     ------------------------------------------------------------------------
     Total...................................   $33,470             $33,145
     ------------------------------------------------------------------------

 9

     Accumulated depreciation accounts were as follows:

   --------------------------------------------------------------------------
                                              March 31,        December 31,
   Millions of Dollars                             1999                1998
   --------------------------------------------------------------------------
                                                               
   Rail                                                   
       Track, structures and facilities......    $3,458              $3,308
       Locomotives...........................     1,407               1,384
       Freight cars..........................     1,084               1,070
       Other equipment.......................       136                 109
   --------------------------------------------------------------------------
   Total Rail................................     6,085               5,871
   Trucking..................................       329                 325
   Other.....................................        14                  10
   --------------------------------------------------------------------------
   Total.....................................    $6,428              $6,206
   --------------------------------------------------------------------------

6.   Debt

     Credit  Facilities - The Corporation had $1.2  billion  of credit  
     facilities  with  various  banks  designated   for general  corporate  
     purposes that  expired  in  the  first quarter of 1999.  Because of 
     improvements in earnings  and operating  cash  flows during the first 
     quarter  of  1999, the  Corporation  no longer required this credit  
     capacity for  operational purposes. A $2.8 billion credit facility, 
     which expires in 2001, remains outstanding.

     Convertible  Preferred Securities - Union Pacific  Capital Trust  (the  
     Trust), a statutory business trust  sponsored and  wholly  owned  by the 
     Corporation,  has  issued  $1.5 billion    aggregate   liquidation   
     amount   of    6-1/4% Convertible Preferred Securities (the CPS).  Each  
     of  the CPS  has  a  stated  liquidation  amount  of  $50  and  is 
     convertible, at the option of the holder, into  shares  of UPC's  common 
     stock, par value $2.50 per share (the Common Stock),  at the rate of 
     0.7257 shares of Common Stock  for each  of  the  CPS,  equivalent to a 
     conversion  price  of $68.90  per  share of Common Stock, subject to  
     adjustment under certain circumstances.  The CPS accrue and pay  cash 
     distributions quarterly in arrears at the annual  rate  of 6-1/4%  of the 
     stated liquidation amount.  The Corporation owns  all  of  the common 
     securities of  the  Trust.   The proceeds  from  the  sale  of  the  CPS  
     and  the   common securities  of  the Trust were invested by  the  Trust 
     in $1.5   billion   aggregate   principal   amount   of   the 
     Corporation's  Convertible Junior Subordinated  Debentures due  2028,  
     which debentures represent the sole assets  of the Trust.

          For  financial reporting purposes, the Corporation  has recorded  
     distributions payable on the CPS as an  interest charge  to  earnings  in  
     the  statement  of  consolidated income.

     Significant  New  Borrowings - During  January  1999,  the Corporation 
     issued $600 million of 6-5/8% debentures  with a  maturity  date of 
     February 1, 2029.  The proceeds  from the  issuance of these debentures 
     were used for  repayment of debt and other general corporate purposes.
  
     Shelf  Registration Statement - Under currently  effective shelf  
     registration statements, the Corporation may  sell, from  time  to time, 
     up to $1 billion in the aggregate  of any  combination of debt securities, 
     preferred  stock,  or warrants for debt securities or preferred stock in 
     one  or more offerings. The Corporation has no immediate plans  to issue 
     equity securities.
  
 10

7.   Earnings  Per Share - The following table  provides  a reconciliation 
     between basic and diluted earnings per share for the periods ended:

     ---------------------------------------------------------------------------
                                                          March 31,   March 31,
     Millions, Except Per Share Amounts                        1999        1998
     ---------------------------------------------------------------------------
                                                                   
     Income Statement Data:                                   
         Net income (loss) available to common stockholders.  $ 129      $  (62)
     Weighted-Average Number of Shares Outstanding:                            
         Basic..............................................  246.3       246.0
         Dilutive effect of common stock equivalents [a]....    1.1           -
     ---------------------------------------------------------------------------
         Diluted............................................  247.4       246.0
     ---------------------------------------------------------------------------
     Earnings Per Share:                                      
         Basic - net income (loss)..........................  $0.52      $(0.25)
         Diluted - net income (loss)........................  $0.52      $(0.25)
     ---------------------------------------------------------------------------

     [a] Excludes the effect of anti-dilutive common stock equivalents related 
     to options and the CPS  (see  Note 6),  which were 21.8 million and 1.7 
     million  for  the three   months   ended  March  31,  1999   and   1998,
     respectively.  
     
8.   Other Income - Other income included the following for the periods ended:

     ---------------------------------------------------------------------------
                                                          March 31,   March 31,
     Millions of Dollars                                       1999        1998
     ---------------------------------------------------------------------------
                                                                      
     Net gain on asset dispositions.........................    $11         $15
     Rental income..........................................     12          11
     Interest income........................................      4           5
     Other - net............................................      4          (8)
     ---------------------------------------------------------------------------
     Total..................................................    $31         $23
     ---------------------------------------------------------------------------

9.   Ratio  of  Earnings to Fixed Charges -  The  ratio  of earnings to fixed  
     charges  has  been  computed   on   a consolidated basis.  Earnings 
     represent net income  (loss) less  equity  in  undistributed earnings of 
     unconsolidated affiliates,  plus income taxes and fixed  charges.  Fixed
     charges  represent interest, amortization of debt discount and  the 
     estimated interest portion of rental charges. For the three months ended 
     March 31,  1998,  fixed  charges exceeded earnings by approximately $114 
     million.

10.  Commitments  and  Contingencies -  There  are  various claims  and  
     lawsuits pending against the Corporation  and certain  of  its  
     subsidiaries. The  Corporation  is  also subject  to  Federal, state and 
     local  environmental  laws and   regulations,  pursuant  to  which it is  
     currently participating  in  the investigation  and  remediation  of 
     numerous  sites.  In  addition, the  Corporation  and  its subsidiaries  
     also periodically enter into  financial  and other  commitments and 
     guarantees in connection with their businesses,   and   have   retained   
     certain   contingent liabilities   upon  the  disposition  of  formerly   
     owned operations.

          It is not possible at this time for the Corporation to determine  
     fully the effect of any or all unasserted claims  on its consolidated 
     financial condition;  however, to  the  extent possible, where unasserted 
     claims  can  be estimated  and where such claims are considered probable, 
     the Corporation has recorded a liability. The Corporation does not expect  
     that  any  known  lawsuits, claims, environmental costs, commitments or 
     guarantees  will  have a  material adverse effect on its consolidated  
     financial condition.   Certain potentially significant contingencies 
     relating to the Corporation's  and  its  subsidiaries' businesses are 
     detailed below:

 11

     Customer Claims - Certain customers have submitted  claims for  damages 
     related to shipments delayed by the  Railroad as  a result of congestion 
     problems, and certain customers have   filed  lawsuits  seeking  relief  
     related  to  such delays.  The  nature  of the damages sought  by  
     claimants includes,  but  is not limited to, contractual  liquidated 
     damages,    freight    loss   or    damage,    alternative transportation 
     charges, additional production costs,  lost business  and  lost profits. 
     In addition,  some  customers have   asserted  that  they  have  the  
     right  to   cancel contracts  as  a  result of alleged material  breaches  
     of such  contracts by the Railroad. The Corporation has made no additional 
     provisions for such claims in 1999.

     Shareholder  Lawsuits - UPC and certain of  its  directors and officers  
     are  defendants  in  two  purported  class actions  that have been 
     consolidated into one  proceeding.  The  consolidated complaint alleges, 
     among other things, that the Corporation violated the Federal securities 
     laws by   failing   to  disclose  material  facts  and making materially 
     false and misleading statements concerning  the service, congestion  and  
     safety  problems   encountered following   the  Corporation's acquisition  
     of   Southern Pacific  in 1996. These lawsuits were filed in  late  1997
     in  the  United  States District Court  for  the  Northern District of 
     Texas and seek to recover unspecified  amounts of  damages.   Management 
     believes  that  the  plaintiffs' claims  are  without  merit and  intends  
     to  defend  them vigorously.  The  defendants have moved  to dismiss this
     action,  and  the  motion has been fully  briefed  and  is awaiting a 
     decision by the Court.

          In addition to the class action litigation, a purported derivative  
     action was filed on behalf of the  Corporation and  UPRR  in  September 
     1998 in the  District  Court  for Tarrant  County,  Texas, naming as  
     defendants  the  then-current  and  certain former directors of the  
     Corporation and  UPRR and, as nominal defendants, the Corporation  and
     UPRR.  The derivative action alleges, among other  things, that  the named 
     directors breached their fiduciary  duties to  the Corporation and UPRR by 
     approving and implementing the  Southern Pacific merger without informing  
     themselves of  its impact or ensuring that adequate controls were put in   
     place   and   by  causing  UPC  and  UPRR   to   make misrepresentations 
     about UPRR's service  problems  to  the financial   markets   and  
     regulatory   authorities.   The Corporation's  Board  of Directors 
     established  a  special litigation   committee  consisting  of  three  
     independent directors  to  review  the  plaintiff's  allegations   and
     determine  whether it is in UPC's best interest to  pursue them.   The  
     committee  has  unanimously  concluded   that further prosecution of the 
     derivative action on behalf  of the  Corporation and UPRR is not in the 
     best  interest  of either  such  company.  Accordingly, the  Corporation  
     and UPRR  have  filed a motion with the Court to  dismiss  the derivative  
     action.  The plaintiff has not  yet  responded to  the  motion.  The 
     individual defendants  also  believe that  these claims are without merit 
     and intend to  defend them vigorously.

11.  Accounting Pronouncements - In June 1998, the Financial Accounting  
     Standards  Board  issued  Statement  No.  133, "Accounting   for  
     Derivative  Instruments   and   Hedging Activities" (FAS 133), that will 
     be effective  January  1, 2000.   While  management  is  still  in  the  
     process  of determining  the  full effect FAS 133  will  have  on  the 
     Corporation's   financial   statements,   management   has determined  
     that FAS 133 will increase the  volatility  of the    Corporation's   
     asset, liability    and    equity (comprehensive  income) positions as  
     the change  in  the fair  market  value  of  all  financial  instruments   
     the Corporation  uses  for  fuel  or  interest  rate   hedging purposes  
     will, upon adoption of FAS 133, be  recorded  in the  Corporation's  
     Statement of Financial  Position  (See Note  4).   In  addition, to the 
     extent fuel hedges  are ineffective  due to pricing differentials 
     resulting from the geographic dispersion of the Corporation's operations, 
     income statement   recognition   of    the ineffective  portion  of  the  
     hedge position   will   be required.   Management does not anticipate 
     that the final adoption  of FAS 133 will have a material impact on  UPC's 
     consolidated financial statements. 

Item  2.   Management's Discussion and Analysis of Financial Condition and 
           Results of Operations

       UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES
                     RESULTS OF OPERATIONS

   Quarter ended March 31, 1999 Compared to March 31, 1998

SERVICE ISSUES

The  results of operations of Union Pacific Corporation (the Corporation  or  
UPC)  and its rail  segment  (Rail),  which includes  the  operations of Union 
Pacific Railroad  Company (UPRR),   and   its   subsidiaries   and   rail   
affiliates (collectively, the Railroad), in the first quarter  of  1998 were 
adversely affected by the congestion that began in  the third quarter of 1997.  
However, service recovery  efforts resulted  in  significant  improvements  in  
operating and financial results beginning in the latter half of  1998 and 
continuing into the first quarter of 1999.

CONSOLIDATED

Net  Income  - The Corporation reported net income of $129 million  or $0.52 
per basic and diluted share for the  first quarter of 1999, compared to a net 
loss of $62 million  or $0.25  per  basic and diluted share in 1998.  This  
earnings increase  resulted  primarily from improved  operations  and service 
levels at UPC's Rail unit. 

Operating  Revenues  -  Operating  revenues  increased  $154 million (6%) to 
$2,740 million in 1999, reflecting increased volumes  from its Rail unit, 
partially offset by the  impact of selling Skyway Freight Systems, Inc. 
(Skyway) in November of 1998.  Skyway generated $44 million in revenue during 
the first quarter of 1998.

Operating  Expenses  -  Operating  expenses  decreased  $175 million (7%) to 
$2,378 million in 1999. Salaries, wages  and employee  benefit costs were $2 
million lower than 1998,  as inflation  and  volume  growth  were  more  than  
offset  by improved  productivity at UPC's Rail unit and  the  sale  of Skyway.
Equipment and other rents were $51  million  (13%) lower  than  1998, caused 
primarily by improved  rail  cycle times,  which  reduced  the  need  for  
leased  rail   cars. Depreciation expense was $7 million (3%) higher  than  
1998, reflecting  increased capital spending for track replacement and  
capacity projects.  Fuel and utilities were $32 million (14%)  lower than 1998 
due to lower fuel prices and improved fuel  efficiency, which were partially 
mitigated  by  higher volumes.  Materials  and  supplies were  unchanged  at  
$144 million in both 1999 and 1998.  Casualty costs decreased  $6 million (5%)  
as  the cost of rail-related accident  claims continued  to  decline.  Other 
costs decreased  $91  million (26%)  to  $257  million  in 1999 reflecting  
lower  service claims costs in 1999, the sale of Skyway and increased  cost
reductions from merger implementation.

Operating  Income - Operating income increased $329  million to  $362  
million  in 1999 reflecting improvements  in  rail operations and service 
levels.  

Non-Operating  Items  - Other income  increased  $8  million (35%)  reflecting  
asset  sales  and  a  one-time  favorable contract settlement. Interest 
expense increased $31 million, the  result of higher debt levels ($25 million) 
and the cost associated  with the early retirement of debt ($6  million).
Income taxes increased $115 million to a $72 million expense
reflecting higher income before income taxes.

 14

dry  chemicals, petroleum products  and phosphorous  moves  all  increased. 
These  gains were partially offset by declines in  soda  ash caused  by the 
adverse impact on demand resulting  from  the Asian  currency crisis, lower 
sulfur moves resulting from a major facility closing, and a decline in liquid 
propane  gas business due to increased rail competition.  ARC improved 2% due   
to   favorable   product mix,   reflecting   traffic improvements  in 
longer-haul plastics and fewer short-haul, low-ARC export sulfur moves.

Intermodal - Commodity revenue increased $27 million (7%) to $388  million, 
while carloadings were up 4% to 626  thousand loads  as  a  result  of better 
cycle  times.  Results  were positively affected by growth in imports from 
Asia.   Import gains  were  partially countered by a decline in exports  to
Asia,  due  to the Asian economic crisis, and lost  business caused by the 
service constraints in 1998.  ARC increased 3% due to positive mix shifts 
(longer-haul shipments) and price increases.

Agriculture  - Commodity revenues were up $32 million  (10%) over  1998  due  
primarily to a service-driven  increase  in carloadings. Volumes increased 11% 
to 223 thousand cars, the result of improved service levels in 1999 that 
resulted in a 25%  increase in wheat carloadings and 15% increases in corn and  
food  grain  carloadings.  However,  demand  for  grain transportation  
continued  to  be  adversely   affected   by depressed  commodity prices. ARC 
declined 1%, primarily  the result  of  a higher proportion of shorter-haul  
Gulf  Coast moves compared to long-haul West Coast moves.

Automotive  -  Commodity revenues were up $23 million  (10%) driven  mainly  
by  a  7%  increase in  carloadings.  Strong domestic production, improvements 
in cycle  times  and  new business with domestic producers all helped to drive 
the 11% improvement in finished vehicle volumes.  Parts volumes were 1% lower 
due to model changeovers and a plant shutdown.  ARC increased  $43  (3%) per 
car due to a combination  of  price increases  and  a  higher proportion of 
higher-ARC  finished vehicle moves.

Operating  Expenses  -  Operating  expenses  decreased  $116 million  (5%)  to  
$2,115 million in 1999.  Rail  operations continued  to improve in key 
operating areas over  the  last three  quarters, which has driven the expense  
decline.  The following table provides explanations for variances in  Rail 
operating  expenses from the quarter ended  March  31,  1999 compared to the 
quarter ended March 31, 1998:

- ---------------------------------------------------------------------------
Millions of Dollars                             Cost Drivers
                           1999 -------------------------------------------
                           Over Price Volume Productivity   Merger
Increase (Decrease)        1998  [b]    [c]       [d]      Benefits Other
- ---------------------------------------------------------------------------    
                                                        
Salaries and benefits..... $ 21   $16   $22      $(9)        $(8)     $ -
Equipment and other rents.  (45)   (6)    6      (39)          -       (6)
Depreciation..............   12     -    12        -           -        -
Fuel and utilities........  (30)  (40)   16       (4)          -       (2)
Materials and supplies....    1     -     1        -           -        -
Casualty costs............   (5)    -     -       (5)          -        -
Other [a].................  (70)    -     -       (8)        (29)     (33)
- ----------------------------------------------------------------------------
Total.....................$(116) $(30)  $57     $(65)       $(37)    $(41)    
- ----------------------------------------------------------------------------

[a]  Includes a $53 million reduction in service recovery costs over 1998.
[b]  Impact of changes in prices paid for goods and services.
[c]  Impact of changing business levels.
[d]  Impact of quality and process improvement.

Salaries, wages and employee benefits - Labor expenses  were $21  million  
(2%) higher than 1998 caused  by  higher  rail volumes and wage inflation that 
were partially mitigated  by merger consolidation benefits and productivity 
improvements. 

 15

Equipment  and  other  rents - Rent  expense  decreased  $45 million  (13%)  
versus 1998 due primarily to improved  cycle times  (13.6  days in 1999 
compared to 17.6 days  in  1998), lower  prices  and  shorter  length  of  
haul,  which   were partially   offset  by  higher  volume  as  gross  
ton-miles increased 9% year-over-year.

Depreciation - Depreciation expense grew $12 million  or  5% to  $258 million 
due to the Railroad's capital spending  in 1998 and 1997, as well as through 
the first quarter of 1999. The  Railroad spent over $2 billion on capital  
projects  in 1998  and $363 million on capital projects during the  first 
quarter of 1999.  

Fuel and utilities - Fuel expenses were down $30 million or 14% from 1998, 
reflecting lower fuel prices  and  improved consumption  rates, which were 
partially  offset  by  higher volume.  A  9%  increase  in gross-ton  miles  
quarter-over-quarter  added  volume-related fuel  costs  of  $16  million
versus  1998.   Prices were down 14 cents per gallon to 50 cents, saving $40 
million. The fuel consumption rate of 1.39 gallons  per thousand gross-ton 
miles improved 2% from  last year,  lowering  fuel  costs  by  another  $4  
million.  The Railroad hedged 70% of its first quarter fuel consumption in
1999,  which increased fuel costs by $19 million, or 6 cents per gallon. 
Expected fuel consumption for the remaining nine months  of 1999 is 64% hedged 
at an average of 55 cents  per gallon (including taxes and transportation 
charges).

Materials and  supplies - Materials  and  supplies  expense increased $1 
million (1%) from first quarter 1998. Increased material  costs for locomotive 
and rebuilt parts, reflecting a  general increase in repair levels, were 
offset by  higher credits received for parts rebuilt.

Casualty  costs  - Casualty costs declined $5  million  (5%) from  1998  due 
to a decline in the average cost  of  injury settlement claims, which was 
partially offset by an increase in  the  number of claims. In addition, 
insurance costs  and costs  for  repairs on cars from other railroads were  
lower quarter-over-quarter.

Other  costs - Other costs decreased $70 million (23%)  from 1998  due to the 
effects of service recovery efforts,  which resulted in a reduction of 
third-party transportation  costs and  the  elimination  of  contract 
penalties  and  customer claims, as well as merger savings.

Operating Income  - Operating income increased  $311 million to  $364 million 
in 1999.  Both periods included the  impact of  one-time merger-related costs 
for severance,  relocation and  training  of  employees ($9 million  reduction  
in  net income  in  1999 and $18 million reduction in net income  in 1998).   
The operating ratio for the first quarter  of  1999 was  85.3,  12.4  points 
better than 1998's  97.7  operating ratio.   Operational  improvements due to  
service  recovery were  the  key  drivers of the improvement in the  operating
ratio.

Non-Operating  Items  - Other income  increased  $5  million (28%).  Interest 
expense increased $22 million, the  result of higher debt levels.  Income 
taxes increased $113 million, reflecting higher income before income taxes.

OTHER OPERATIONS

Trucking Product Line

Net  Income - Trucking earnings decreased $1 million  to  $9 million in the 
first quarter of 1999 from $10 million in the first quarter of 1998 
(excluding goodwill amortization of $5 million in 1998).

Operating Revenues - Trucking revenues decreased $4  million (2%)  to $253 
million, as steady volumes combined with a 1% decrease in average prices.   
Stable  volumes  reflected weather  problems  and  the absence of a  
threatened  labor strike that helped boost 1998 volumes.

 16

Operating  Expenses - Operating expenses  remained  flat  at $243  million  
in  1999, compared to $244  million  in  1998 (excluding  goodwill 
amortization of $5  million  in  1998). Salaries,  wages  and employee 
benefit  costs  increased  $4 million  (3%)  to $158 million reflecting wage  
and  benefit inflation and the addition of a new product offering in  the
eastern and southern United States. Rent expense declined $4 million (18%) to 
$18 million due to a shift from third-party to  internal transportation 
sources. Fuel costs declined  $1 million  (8%)  due to lower fuel prices (44  
cents  in  1999 compared  to 58 cents in 1998). Fuel hedging increased  fuel
expense  by  $600  thousand in 1999, and  40%  of  estimated remaining 1999 
fuel purchases are hedged at an average of 45 cents per gallon.

Operating  Income - Trucking operations generated  operating income of $10 
million for the first quarter of 1999 compared to  $13  million  for  the  
comparable  period  a  year  ago (excluding goodwill amortization of $5 
million in 1998). The operating ratio for trucking operations (excluding  
goodwill amortization  in  1998) rose to 95.9 in 1999  from  94.9  in 1998.

Other Product Lines

Other   operations  include  the  technology  and  insurance product  lines,  
as  well as the corporate  holding  company operations and all necessary 
consolidating entries (see Note 2  to  the  Consolidated  Financial  
Statements).  Operating revenues declined $37 million in 1999 due primarily  
to  the sale   of   Skyway  in  November  1998.  Operating  expenses decreased  
$53 million reflecting the absence of 1999  costs associated with Skyway and 
the consolidation of portions  of the  Corporate  staff with the Rail unit's 
staff  in  Omaha, Nebraska. Operating losses declined $16 million, also due to
the  corporate restructuring and improved operations at  the Corporation's  
technology division.  Net losses  from  these operations also declined $6 
million over 1998.

    CHANGES IN FINANCIAL CONDITION AND OTHER DEVELOPMENTS

Financial Condition - During the first three months of 1999, cash provided by 
operations was $413 million,  compared  to cash  used by operations of $117 
million in 1998. This  $530 million  increase  primarily reflects  higher  
earnings  and improvements  in  working capital in the Corporation's  Rail
segment, reflecting the success of service recovery  efforts in the first 
quarter of 1999 and the last half of 1998.

   Cash used in investing activities was $462 million in the first  quarter  
of 1999, compared to $553 million  in  1998.  This   decrease  primarily  
reflects  lower   Rail   capital spending, including merger-related spending, 
offset  by  the $87  million  investment in the Corporation's  Mexican  rail
operations  (see  Note  3  to  the  Consolidated   Financial Statements).

   Cash  used  in  equity and financing activities  was  $20 million  in  the  
first quarter of 1999,  compared  to  $771 million provided by equity and 
financing activities in 1998.  Cash  used in 1999 principally reflects lower 
net borrowings ($398  million  in 1999 compared to $1.77 billion  in  1998)
offset  by  debt  repaid  ($369 million  in  1999  and  $888 million in 1998).

   The ratio of debt to total capital employed (treating the Corporation's 
6-1/4% Convertible Preferred Securities  (CPS) as  a debt instrument) was 
57.7% at March 31, 1999, compared to  58.0% at December 31, 1998 and 57.8% at 
March 31,  1998.  Including  the CPS (see Note 6 to the Consolidated Financial
Statements) as an equity instrument, the ratio  of  debt  to total  capital 
employed at March 31, 1999 was 49.3%  and  at December 31, 1998 was 49.4%.

 17

   The Corporation had $1.2 billion of credit facilities with various banks 
designated for general corporate purposes that expired   in   the  first  
quarter  of  1999.   Because   of improvements in earnings and operating cash 
flows during the first  quarter  of  1999  and the last  half  of  1998,  the
Corporation  no  longer required this  credit  capacity  for operational 
purposes.  A $2.8 billion credit facility, which expires  in  2001, remains 
outstanding. During January  1999 the  Corporation  issued $600 million of  
6-5/8%  debentures with  a maturity date of February 1, 2029. The proceeds 
from the issuance of these debentures were used for repayment  of debt  and 
other general corporate purposes.  Under currently effective shelf 
registration statements, the Corporation may sell,  from time to time, up to 
$1 billion in the  aggregate of  any combination of debt securities, preferred 
stock,  or warrants  for debt securities or preferred stock in  one  or more  
offerings. The Corporation has no immediate  plans  to issue equity securities.

                              OTHER MATTERS

Commitments and Contingencies - There are various claims and lawsuits pending 
against the Corporation and certain of  its subsidiaries.    In  addition,  
the  Corporation   and   its subsidiaries are subject to various Federal, 
state and local environmental  laws and are currently participating  in  the
investigation   and  remediation  of   various   sites.    A discussion  of  
certain  claims,  lawsuits,  guarantees  and contingencies  is  set forth in 
Note 10 to the  Consolidated Financial  Statements,  which  is  incorporated  
herein   by reference.  

Accounting  Pronouncements  - In  June  1998  the  Financial Accounting  
Standards  Board  issued  Statement   No.   133, "Accounting   for   
Derivative   Instruments   and   Hedging Activities"  (FAS  133), that will be 
effective  January  1, 2000.    While  management  is  still  in  the  
process   of determining  the  full  effect FAS  133  will  have  on  the 
Corporation's    financial   statements,   management    has determined that 
FAS 133 will increase the volatility of  the Corporation's  asset,  liability 
and  equity  (comprehensive income) positions as the change in the fair market 
value  of all  financial instruments the Corporation uses for fuel  or 
interest  rate hedging purposes will, upon adoption  of  FAS 133, be recorded 
in the Corporation's Statement of Financial Position   (See   Note  4  to  the  
Consolidated   Financial Statements).   In  addition, to the extent fuel  
hedges  are ineffective due to pricing differentials resulting from  the 
geographic   dispersion  of  the  Corporation's  operations, income  
statement recognition of the ineffective portion  of the  hedge position will 
be required.  Management  does  not anticipate  that the final adoption of 
FAS 133 will  have  a material impact on UPC's consolidated financial 
statements. 

Year  2000 - The Year 2000 (Y2K) compliance project  at  UPC includes  
software  (internally  developed  and  purchased), hardware  and embedded 
chips inside equipment and machinery, primarily  at it's Rail unit. The 
Corporation's  enterprise-wide  project encompasses computer systems and 
equipment  in multiple  data  centers  and  a  telecommunications  network
spread   over  23  states.  Equipment  containing   embedded computer   chips   
includes  locomotives,  automated   train switching systems, computer aided 
train dispatching systems, signaling  systems, computerized fueling stations, 
weigh-in-motion  scales,  cranes, lifts, PBX systems, elevators,  and 
computerized  monitoring  systems throughout  UPC.  The  Y2K project started 
with research in 1994 and an impact analysis of  the  Corporation's mainframe 
COBOL systems in 1995.  The Y2K project has been a high priority since then.
 
   UPC's  Y2K Project is divided into five major initiatives as follows:

Mainframe  Systems  -  These systems  have  been  converted, tested  and  
deemed to be Y2K compliant as of  December  31, 1998.  Periodic  audits are 
planned during  1999  to  ensure these systems remain Y2K compliant.

 18

Client  Server Systems - Modifications of these systems  are on  schedule, 
and the Corporation believes that all critical client  server  systems  have 
been  converted,  tested,  and deemed to be Y2K compliant as of December 31, 
1998. The non-critical client server systems are scheduled to be tested as
Y2K compliant by mid-1999.  

User Department Developed Systems - These systems consist of both  mainframe 
and PC-based systems developed  by  internal user  departments.  Modifications 
of these  systems  are  on schedule,  and  the Corporation estimates that 
approximately 99%  of  the systems are complete as of March 31, 1999,  and 
the  remaining 1% are mostly low priority systems  that  are scheduled to be 
completed in the first half of 1999. 

Vendor Supplied and Embedded Systems - These systems consist of  
vendor-supplied software, desktop, mainframe and  server hardware,  databases  
and  operating  systems,  as  well  as equipment  and machinery with embedded 
systems. One  hundred percent  of  the  identified  critical  suppliers  of  
these systems  have indicated that they have a comprehensive  Year 2000 plan. 
To help assure safety and Y2K compliance, UPC  is testing  selected critical 
software, hardware  and  embedded systems,  even  if  the  vendor has  already  
certified  the product.  The  Corporation  is sharing  information  on  the
compliance and testing of safety critical components  common to  the industry 
with the cooperation of the Association  of American Railroads (AAR).

Electronic Commerce Systems - These systems consist  of  all electronic 
exchanges of information with customers, vendors, other  railroads  and 
financial institutions.  The  railroad industry  has  agreed  on a standard 
4-digit  year  for  all electronic interchanges. The Rail unit can now 
transmit  and receive  the new EDI standard that involves a 4-digit  year.
The  Corporation plans additional Y2K testing with customers and trading 
partners using current and older versions of EDI transactions in 1999.

   For each of these initiatives, seven major categories  of events  have  
been identified for contingency  plans.  These categories  are (1) key data - 
integrity/loss, (2)  critical software,  (3)  critical hardware, (4)  
communications,  (5) critical supplies and suppliers, (6) facilities, and (7) 
key personnel. The contingency plans also include a Y2K  command center  that  
will be staffed 24 hours a day in  the  fourth quarter  of  1999  and 
continuing into early  2000  for  any problems  that  might occur due to Y2K. 
The  staff  will  be composed of technical experts to fix or advise what  to  
fix if systems fail, and knowledgeable representatives from each business  
unit. Contingency plans continue to  be  developed and will be refined and 
adjusted throughout 1999. 

    As   of  March  31,  1999,  approximately  98%  of   the Corporation's   
systems  (excluding  trucking)   have   been converted, tested, and deemed to 
be Y2K compliant,  and  the remaining systems are expected to be modified by 
the  second quarter  of 1999. Modification to trucking systems comprises
approximately  10%  of  UPC's total  Y2K  workload,  and  is estimated to be 
95% complete. The remaining modification  to trucking's systems is expected to 
be completed in the second quarter of 1999. Costs to convert UPC's systems are 
expensed as  incurred.  As of March 31, 1999, more than  70%  of  the costs  
of  the Y2K project, estimated to be $61  million  in total, have been 
expensed. Although the Corporation believes its systems will be successfully 
modified, failure by it, or by  those  from whom UPC purchases equipment,  or  
by  other entities with whom UPC exchanges data, or on whom it  relies for  
data,  to  successfully  modify  their  systems,  could materially  impact 
operations and financial results  in  the year 2000.

                            CAUTIONARY INFORMATION

Certain  information included in this report  contains,  and other materials 
filed or to be filed by the Corporation with the   Securities  and  Exchange  
Commission  (as   well   as information  included in oral statements  or  
other  written statements made or to be made by the Corporation) contain or
will  contain, forward-looking statements within the meaning of   the  
Securities  Act  of  1933,  as  amended,  and  the Securities  Exchange Act 
of 1934, as amended. Such  forward-looking   information   may  include,  
without   limitation, statements that the Corporation does not expect that 
claims, lawsuits,   environmental  costs,  commitments,   contingent 
liabilities, labor 

 19

negotiations or other matters will have a material adverse  effect  on  its  
consolidated  financial condition,  results  of operations or  liquidity  and  
other similar   expressions  concerning matters  that   are   not historical 
facts, and projections or predictions as  to  the Corporation's financial or 
operational results. Such forward-looking  information  is  or will be  based  
on  information available at that time, and is or will be subject  to  risks
and  uncertainties that could cause actual results to differ materially from 
those expressed in the statements. Important factors  that could cause such 
differences include, but  are not  limited to, whether the Corporation is 
fully successful in recovering from the effects of the Rail unit's 
congestion-related   problems  and  implementing  its   financial   and
operational   initiatives;  regaining  its   customers   who switched  to 
alternative transportation arrangements during the service  crisis; industry 
competition  and  legislative and/or  regulatory  developments;  natural  
events  such  as severe  weather,  floods  and earthquakes;  the  effects of
adverse general economic conditions; changes in fuel prices; labor strikes; 
the impact of year 2000 systems problems; the outcome of shipper claims 
related to congestion; and  claims arising from environmental investigations 
or proceedings and other  types  of  claims  and litigation.   The  
Corporation assumes  no obligation to update forward-looking information to 
reflect actual results, changes in assumptions or changes in other factors 
affecting forward-looking information. 

Item  3.   Quantitative  and Qualitative  Disclosures  About Market Risk

Disclosure  concerning market risk-sensitive instruments  is set forth in Note 
4 to the Consolidated Financial Statements included  in  Item  1  of  Part I  
of  this  Report  and  is incorporated herein by reference.

PART II.  OTHER INFORMATION

Item 1.  Legal Proceedings

The  discussion of certain legal proceedings  affecting  the Corporation 
and/or certain of its subsidiaries set forth  in Note 10 to the Consolidated 
Financial Statements included in Item  1  of Part I of this Report is 
incorporated herein  by reference.   In  addition  to those matters,  the  
following proceedings,   or  developments  in  proceedings   presently 
pending, arose or occurred during the first quarter of 1999.  

Southern Pacific  Acquisition  -  As   reported   in   the Corporation's 
Annual Report on Form 10-K for the year  ended December  31, 1998 (the UPC 
1998 10-K), on August  12,  1996 the  STB  served  a  decision (the Decision)  
approving  the acquisition   of   control  of  Southern  Pacific   by   
the Corporation, subject to various conditions.  The acquisition was 
consummated on September 11, 1996.  Various appeals were filed  with  
respect to the Decision, and all  such  appeals were  ultimately consolidated 
in the U.S. Court  of  Appeals for  the District of Columbia Circuit.  All 
the appeals were subsequently withdrawn except the appeal of the Western Coal 
Traffic  League.  On March 23, 1999, the  Court  of  Appeals entered an order 
affirming the Decision in all respects. 

Bottleneck  Proceedings - As reported in the UPC 1998  10-K, the U.S. Court of 
Appeals for the Eighth Circuit entered  an order on February 10, 1999 that 
affirmed a prior decision by the  Surface Transportation Board of the U.S. 
Department  of Transportation  (STB).  That decision  generally  reaffirmed
the STB's existing position regarding the obligation of rail carriers  to 
provide rates for "bottleneck" segments  (lines of  railroad that are served 
by a single railroad between  a junction  and  an exclusively-served shipper  
facility)  and dismissed  two  complaint  proceedings  filed  by   shippers
challenging a class rate charged for the movement  of  coal, to which UPRR and 
Southern Pacific Transportation Company, a predecessor  to UPRR, were parties.  
The STB's decision  was originally  served  on  December 31, 1996  and  
subsequently clarified on April 30, 1997.  On March 23, 1999, two of  the
shippers  involved  in  the complaint  proceedings  filed  a petition  for  
rehearing with the Eighth  Circuit  Court  of Appeals, which was denied by the 
Court on April 20, 1999. 

 20

Labor Matters - The UPC 1998 10-K disclosed that the General Counsel  of the 
National Labor Relations Board is seeking  a bargaining  order  remedy  in 12  
cases  involving  Overnite Transportation  Company (Overnite), where a 
Teamsters  local union  lost  a representation election and that a thirteenth
bargaining   order   case  involving   Overnite   had   been tentatively 
settled by the parties thereto without  imposing a requirement that Overnite 
bargain with the Teamsters local involved in the case.  During the first 
quarter of 1999, the settlement  of  the  thirteenth bargaining  order  case  
was finalized  with no material change in the terms  upon  which the  case  
had tentatively been settled.  Overnite continues to  believe  it  has 
substantial defenses in  the  remaining pending  bargaining order cases and 
intends to  continue  to defend them aggressively.  

Environmental  Matters - As reported in the UPC  1998  10-K, the  Railroad  
had received notification that  the  District Attorney for San Bernardino 
County, California had opened an investigation  into  the  Railroad's  
handling  of   several hazardous material spills and releases in Barstow and  
West Colton,  California.  As a result of the investigation,  the District 
Attorney's office had alleged that the Railroad had not  taken  sufficient  
action to  prevent  the  spills  and releases  and had not promptly reported 
them to  the  proper agencies.  The  District Attorney further alleged  that  
the required  business plans for releases of hazardous materials at  West  
Colton  had not been filed with  the  county  fire department  for several 
years.  During the first quarter  of 1999, a final settlement was negotiated 
with the  District Attorney's  office disposing of all pending cases 
pertaining to  these  incidents in consideration of the  payment of a civil  
penalty in the amount of $350,000 and the  Railroad's agreement to promptly 
report and handle any future spills. 

Item 4.  Submission of Matters to a Vote of Security Holders

     (a)  The annual meeting of shareholders of the Corporation was held on 
          April 16, 1999.

     (c)  At    the    Annual   Meeting,   the   Corporation's shareholders  
          voted for the election of Philip  F. Anschutz (206,131,793 shares  
          in  favor;  3,830,245 shares  withheld),  Robert  P.  Bauman  
          (206,311,323 shares   in   favor;  3,650,715  shares   withheld),
          Richard  B.  Cheney (206,362,463  shares  in  favor; 3,599,575   
          shares withheld),  E.   Virgil   Conway (206,361,108  shares in  
          favor; 3,600,930   shares withheld),  Richard K. Davidson 
          (206,148,255  shares in  favor;  3,813,783  shares withheld),  
          Thomas  J. Donohue  (206,381,764 shares  in  favor;  3,580,274 
          shares  withheld),  Spencer F.  Eccles (206,390,025 shares  in  
          favor; 3,572,013 shares withheld),  Ivor J.  Evans (206,387,492 
          shares in  favor;  3,574,546 shares    withheld),   Elbridge T.   
          Gerry, Jr. (206,390,963  shares  in  favor;  3,571,075   shares
          withheld), William H. Gray, III (206,351,595  shares in   favor;   
          3,610,443  shares  withheld),   Judith Richards   Hope   
          (205,498,557  shares   in   favor; 4,463,481  shares  withheld),  
          Richard  J.   Mahoney (206,415,207  shares  in  favor;  3,546,831   
          shares withheld),  and  Richard  D.  Simmons  (206,345,9832 shares  
          in  favor;  3,616,106 shares  withheld),  as directors  of  the  
          Corporation.  In  addition, the Corporation's shareholders voted  
          to  ratify   the appointment  of Deloitte & Touche LLP as 
          independent auditors  of the Corporation (208,519,829 shares  in
          favor;   752,195  shares  against;   690,014  shares withheld) and  
          voted  on  a  shareholder   proposal regarding executive 
          compensation (14,710,507  shares in  favor;  166,459,349  shares  
          against; 3,350,757 shares withheld and 25,441,425 shares not voted  
          by brokers).
     
 21

Item 6. Exhibits and Reports on Form 8-K

     (a)  Exhibits

          12 - Computation  of  ratio  of earnings to fixed charges.
          27 - Financial data schedule.

     (b)  Reports on Form 8-K

           On  January 21, 1999, UPC filed a Current  Report  on Form  8-K 
           announcing UPC's financial results for the fourth quarter of 1998.
       
[SIGNATURE] 

                                    SIGNATURE

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

Dated:  May 14, 1999

                       UNION PACIFIC CORPORATION
                       (Registrant)

                       /s/ James R. Young
                       ------------------
                       James R. Young
                       Senior Vice President - Finance and Controller
                       (Chief Accounting Officer and Duly Authorized Officer)

 INDEX

                  UNION PACIFIC CORPORATION
                        EXHIBIT INDEX

Exhibit No.  Description of Exhibits Filed with this Statement
- -----------  -------------------------------------------------
   12        Computation  of Ratio of Earnings  to  Fixed Charges.

   27        Financial Data Schedule.

                                                   Exhibit 12

     UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES

     COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

                        (Unaudited)

       
- -------------------------------------------------------------------------------
                                                  Three Months Ended March 31,
                                                  -----------------------------
Millions of Dollars Except Ratios                             1999   1998
- -------------------------------------------------------------------------------
                                                               
Earnings
  Net Income (Loss).......................................... $129   $(62)
  Undistributed equity earnings..............................  (10)    (9)
- -------------------------------------------------------------------------------
  Total......................................................  119    (71)
- -------------------------------------------------------------------------------
Income Taxes.................................................   72    (43)
- -------------------------------------------------------------------------------
Fixed Charges:
  Interest expense including amortization of debt discount...  192    161
  Portion of rentals representing an interest factor.........   45     45
- -------------------------------------------------------------------------------
  Total......................................................  237    206
- -------------------------------------------------------------------------------
Earnings Available for Fixed Charges.........................  428     92
- -------------------------------------------------------------------------------
Total Fixed Charges -- as above.............................. $237   $206
- -------------------------------------------------------------------------------
Ratio of earnings to fixed charges (Note  9).................  1.8    0.4
- -------------------------------------------------------------------------------

  

 5

This is a legend.

 1,000,000

                   3-MOS
                          DEC-31-1999
                               MAR-31-1999
                                             107
                                         0
                                      632
                                         0
                                        350
                                  1436
                                           33470
                                    6428
                                   29455
                             2939
                                           8539
                                0
                                          0
                                           691
                                        6787
                     29455
                                              0
                                  2740
                                                0
                                     2378
                                     0
                                     0
                                 192
                                    201
                                        72
                                129
                                       0
                                      0
                                            0
                                       129
                                     0.52
                                     0.52