UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549
                                  SCHEDULE 13G
                    Under the Securities Exchange Act of 1934
                          (Amendment No. __________ ) *



                                 Data Race, Inc.
 ------------------------------------------------------------------------------
                                (Name of Issuer)



                                  Common Stock
 ------------------------------------------------------------------------------
                         (Title of Class of Securities)



                                    237842109
                        ---------------------------------
                                 (CUSIP Number)



* 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 the
disclosures provided in a prior cover page.

The information required in 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






CUSIP No.  237842109                 13G                       Page 2 of 5 Pages


- --------------------------------------------------------------------------------
1)       Names of Reporting Persons
         SS or IRS Identification                  Capital Southwest Corporation
         Number of Above Persons:                             75-1072796
- --------------------------------------------------------------------------------
2)       Check the Appropriate Box                            (a)
         if a Member of a Group:                              (b)
         (See Instructions)                                    Not Applicable
- --------------------------------------------------------------------------------
3)       SEC Use Only


- --------------------------------------------------------------------------------
4)       Citizenship or Place of
         Organization:
                                                United States
- --------------------------------------------------------------------------------
5)       Number of Shares                  5) Sole Voting Power:       -0-
         Beneficially Owned                6) Shared Voting Power:     -0-
         by Each Reporting                 7) Sole Dispositive Power:  -0-
         Person With:                      8) Shared Dispositive Power:-0-
- --------------------------------------------------------------------------------
9)       Aggregate Amount
         Beneficially Owned by
         Each Reporting Person:                                  None.
- --------------------------------------------------------------------------------
10)      Check if the Aggregate Amount
         in Row (9) Excludes Certain Shares:
         (See Instructions)                                      Not applicable.
- --------------------------------------------------------------------------------
11)      Percent of Class Represented by
         Amount in Row 9:                                        None.
- --------------------------------------------------------------------------------
12)      Type of Reporting Person:
         (See Instructions)                                      CO
- --------------------------------------------------------------------------------






CUSIP No.  237842109                   13G                     Page 3 of 5 Pages


                                   Item 1(a).

                  Name of Issuer:      Data Race, Inc.

                                   Item 1(b).

                  Address of Issuer's Principal Executive Offices:

                                12400 Network Blvd., San Antonio, TX 78249

                                   Item 2(a).

                  Name of Person Filing:    Capital Southwest Corporation

                                   Item 2(b).

                  Address of Principal Business Office or, if None, Residence:

                               12900 Preston Road, Suite 700, Dallas, TX  75230

                                   Item 2(c).

                  Citizenship:      United States

                                   Item 2(d).

                  Title of Class of Securities:   Common Stock

                                   Item 2(e).

                  CUSIP No.:       237842109

                                     Item 3.

     If this statement is filed pursuant to Rule  13d-1(b),  or 13d-2(b),  check
     whether the person filing is a:

     (a) [ ] Broker or Dealer registered under Section 15 of the Act

     (b) [ ] Bank as defined in Section 3(a)(6) of the Act

     (c) [ ] Insurance Company as defined in Section 3(a)(19) of the Act

     (d) [ ] Investment  Company  registered  under Section 8 of the  Investment
             Company Act

     (e) [ ] Investment  Advisor  registered under Section 203 of the Investment
             Advisers Act of 1940

     (f) [ ] Employee  Benefit  Plan,  Pension  Fund  which is  subject  to the
             provisions  of the  Employee  Retirement  Income  Security  Act of 
             1974 or Endowment Fund; see ss.240.13d-1(b)(1)(ii)(F)

     (g) [ ] Parent Holding Company, in accordance with ss.240.13d-1(b)(1)(ii)
             (G) (Note: See Item 7)

     (h) [ ] Group, in accordance with ss.240.13d-1(b)(1)(ii)(H)







CUSIP No.  237842109                13G                        Page 4 of 5 Pages


                                     Item 4.

Ownership.

         If the  percent  of the  class  owned,  as of  December  31 of the year
covered by the statement,  or as of the last day of any month  described in Rule
13d-1(b)(2),  if  applicable,   exceeds  five  percent,  provide  the  following
information  as of that date and identify those shares which there is a right to
acquire.

         (a)    Amount Beneficially Owned:                      Not Applicable

         (b)    Percent of Class:
         (c)    Number of shares as to which such person has:
                (i) sole power to vote or to direct the vote:
                (ii) shared power to vote or to direct the vote:         
                (iii)sole power to dispose or to direct the disposition of:
                (iv) shared power to dispose or to direct the disposition of:


                                     Item 5.

          Ownership of Five Percent or Less of a Class.

         If this statement is being filed to report the fact that as of the date
hereof the reporting  person has ceased to be the beneficial  owner of more than
five percent of the class of securities, check the following [X].



                                     Item 6.

          Ownership of More than Five Percent on Behalf of Another Person.

                  Not applicable.

                                     Item 7.

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

                  Not applicable.

                                     Item 8.

          Identification and Classification of Members of the Group.

                  Not applicable.

                                     Item 9.

          Notice of Dissolution of Group.

                  Not applicable.





CUSIP No.   237842109                  13G                     Page 5 of 5 Pages



                                    Item 10.

          Certification and 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.



                                                        January 22, 1998
                                                        ------------------------
                                                        Date

                                                        /s/ Patrick F. Hamner
                                                        ------------------------
                                                        Signature

                                                        Patrick F. Hamner
                                                        Vice President
                                                        ------------------------
                                                        Name and Title