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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

SCHEDULE 13G

UNDER THE SECURITIES EXCHANGE ACT OF 1934

Nanophase Technologies Corporation
- -----------------------------------------
(Name of Issuer)
Common Stock
- -----------------------------------------
(Title of Class Securities)
630079101
- -----------------------------------------
(CUSIP Number)
October 1, 1998
- -----------------------------------------
(Date of Event Which Requires Filing of this Statement

Check the appropriate box to designate the rule pursuant to
which this Schedule is filed:
/ / Rule 13d-1(b)
/X/ Rule 13d-1(c)
/ / Rule 13d-1(d)

*The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect
to the subject class of securities, and for any subsequent
amendment containing information which would alter
disclosures provided in a prior cover page.

The information required on the remainder of this cover page
shall not be deemed to be "filed" for the purpose of Section
18 of the Securities Exchange Act of 1934 ("Act") or
otherwise subject to the liabilities of that section of the
Act but shall be subject to all other provisions of the Act
(however, see the Notes).

Page   1   of  5  Pages
 2

CUSIP NO. 630079101     13G

1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Spurgeon Corporation

2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a)/X /
(b)/  /

3 SEC USE ONLY

4 CITIZENSHIP OR PLACE OF ORGANIZATION
Illinois Corporation

              5 SOLE VOTING POWER
NUMBER OF       NONE
SHARES
BENEFICIALLY  6 SHARED VOTING POWER
OWNED BY        1,652,743 SHARES
EACH
REPORTING     7 SOLE DISPOSITIVE POWER
PERSON          NONE
WITH
              8 SHARED DISPOSITIVE POWER
                1,652,743 SHARES

9 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
1,652,743 SHARES

10 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES
CERTAIN SHARES*/  /

11 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9)
13.1%

12 TYPE OF REPORTING PERSON*
CO

*SEE INSTRUCTIONS BEFORE FILLING OUT!

Page   2   of   5   Pages

 3

Page   3   of  5   Pages

Item 1.
(a) Name of Issuer
Nanophase Technologies Corporation

(b) Address of Issuer's Principal Executive Offices
453 Commerce St., Burr Ridge, IL 60521

Item 2.
(a) Name of Person Filing
Spurgeon Corporation

(b) Address of Principal Business Office or, if none,
Residence
290 South County Farm Rd.
Third Floor
Wheaton, Il 60187

(c) Citizenship
Illinois Corporation

(d) Title of Class of Securities
Common Stock

(e) Cusip Number
630079101

Item 3. Not Applicable

Item 4. Ownership
Provide the following information regarding the aggregate
number and percentage of the class of securities of the
issuer identified in Item 1.

(a) Amount Beneficially Owned
1,652,743 shares

(b) Percent of Class
13.1%

(c) Number of shares as to which such person has:
(i) sole power to vote or to direct the vote
None

(ii) shared power to vote or to direct the vote
1,652,743 shares

(iii) sole power to dispose or to direct the vote
None

(iv) shared power to dispose or to direct the disposition of
1,652,743 shares


Item 5. Ownership of Five Percent or Less of a Class
Not Applicable



Page   4   of  5   Pages

Item 6. Ownership of More than Five Percent of Behalf of
Another Person.
None

Item 7. Identification and Classification of the Subsidiary
Which Acquired the Security Being Reported on By the Parent
Holding Company

Reporting person is not a parent holding company.

Item 8. Identification and Classification of Member of the
Group

Spurgeon Corporation is reporting this ownership as a member
of a group with Bradford T. Whitmore.  Bradford T. Whitmore
and Spurgeon Corporation are both general partners of Grace
Brothers, Ltd. which owns 582,993 shares and Spurgeon and
an entity wholly owned by Whitmore are both general partners
of Grace Investments, Ltd., which owns 1,069,750 shares.

Item 9. Notice of Dissolution of Group

Reporting person is not filing notice of dissolution of a
group.

Item 10. Certification
(b) The following certification shall be included if the
statement is filed pursuant to Section 240.13d-1(c):

By signing below I certify that, to the best of my knowledge
and belief, the securities referred to above were not
acquired and are not held for the purpose of or with the
effect of changing or influencing the control of the issuer
of the securities and were not acquired and are not held
in connection with or as a participant in any transaction
having that purpose or effect.

SIGNATURE

After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this
statement is true, complete and correct.

Dated:  October 12, 1998

David J. Allen

By:/s/ David J. Allen
   ------------------------
       Vice President
       Spurgeon Corporation