I graduated from college in December 1997 with a job offer in hand. As such, '98 was my first full year with a regular paycheck, and I averaged about 8 new release CDs a month. CMJ's monthly consumer mag was actually monthly and my chief source for music info.
+1 on Air, Rancid (my favorite of theirs actually), Elliott Smith, Massive Attack, Beastie Boys
Some more favorite-from-the-artist's catalog. Many of them are also points of entry.
I know this album gets some flak from SDRE fans (Hegel), but it was my #1 of '98 at the time and still my favorite whole album from anything with Enigk on it.

Probably my #1 of '98 now, though it's not reflected in either Listmania. Gothic country to the max with a serious fear of God and Jesus.

My proper point-of-entry for the Maryland boys. Out-Sabbaths any band I've heard that credits Sabbath as an influence.

Best front-to-back Beck album IMHO.

Punk with a strong reg-rock influence/appeal. See also: Rocket from the Crypt -
RFTC
I know Far/Jonah gets some love here, and chances are I missed it in this thread. One of the better pre-guyliner emo releases.
Some stuff I don't go back to often but enjoy when I do...
Tried to see Mary Lou Lord twice that year. She fell of the drink wagon shortly before her Denver date, and they printed the wrong set time at Lilith Fair. "Subway" still draws me right in.

Yet another solid late-90s trip-hop rekkid.

William Parker from the New York free jazz scene (Matthew Ship, Suzie Iberra, et al.) composed a few discs worth of material and leads a 25-piece ensemble through it. All over the place.

One of my favorite shows from my Denver years. The techno influences on this release were absent, and the guy (and his drumming grandson) brought it.