Strange baryon pair production in two-photon collisions is studied 
with the L3 detector at LEP. The analysis is based on data collected 
at $e^+e^-$ centre-of-mass energies from 91 GeV to 208 GeV, corresponding 
to an integrated luminosity of 844 pb$^{-1}$. The processes 
$\gamma \gamma \rightarrow \Lambda \overline{\Lambda}$ and 
$\gamma \gamma \rightarrow \Sigma^0 \overline{\Sigma}\,\!^0$ are 
identified. Their cross sections as a function of the $\gamma \gamma$ 
centre-of-mass energy are measured and results are compared to predictions 
of the quark-diquark model.