FORM 10-QSB
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D. C. 20549

[X] Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange
    Act of 1934 for the fiscal quarter ended September 30, 2001
[ ] 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   000-29669

                            OnLine Power Supply, Inc.
--------------------------------------------------------------------------------
               (Exact Name of Company as Specified in its Charter)

             Nevada                                          84-1176494
-------------------------------------------------     --------------------------
      (State or other jurisdiction of                     (I.R.S. Employer
       Incorporation or organization)                     Identification No.)

   8100 South Akron, # 308 Englewood, Colorado                 80112
-------------------------------------------------     --------------------------
      (Address of principal executive offices)               (Zip Code)

Company's telephone Number:    (303) 741-5641
                             --------------------

     Former Address through February 28, 2001: 6909 South Holly Circle #200
                                               Englewood, Co 80112
--------------------------------------------------------------------------------
                        (Former name, former address and
                former fiscal year, if changed since last report)

     Check whether the Company:  (1) has filed all reports  required to be filed
by Section 13 or 15(d) of the  Securities  and  Exchange  Act of 1934 during the
preceding 12 months (or for such shorter period that the Company was required to
file such reports), and (2) has been subject to such filing requirements for the
past 90 days. YES   X    NO
                  -----     -----

     State the number of shares  outstanding of each of the issuer's  classes of
common stock, as of the latest practicable date.

                Class                         Outstanding at November 12, 2001
---------------------------------------     ------------------------------------
   Common stock, $.0001 par value                    21,243,155 Shares



<PAGE>










                 DISCLOSURE REGARDING FORWARD LOOKING STATEMENTS

Except  for  historic  financial  information,  all of the  information  that is
contained in this Form 10-QSB is comprised of forward-looking  statements within
the  meaning of the  Securities  and  Exchange  Act of 1934.  Specifically,  all
statements in the report,  other than historical facts,  regarding our financial
position,   business   strategy,   and   plans   for   future   operations   are
forward-looking.  These  statements  are based on beliefs of management  and are
subject to known and  unknown  risks.  These  risks  involve  present and future
economic  conditions,  market  conditions  for our  existing  and new  products,
available  financing  when and if needed for  operations,  litigation  and other
unknown business factors,  all of which may change and produce risks and results
very different than those now affecting us. The words  "anticipate",  "believe",
"estimate",  "expect", "will", "may", "continue", "intend", "could" and "should"
or other words and phrases  similar to these are  intended to caution the reader
of the forward-looking  nature of their use.  Statements  containing these words
should be considered  "cautionary".  Management's  statements in this report are
based on the most accurate  assessment of the risks associated with the business
today; however,  certain facts and assumptions may not be fully realized and the
actual  future  operating  results  may  prove to be  different  than  expected.
Although  we believe our  assumptions  are  reasonable,  we are  qualifying  all
written  statements  attributed  to  management's  estimates as  cautionary  and
forward-looking  and  accordingly   expressly  qualify  their  accuracy  pending
substantial realization of the underlying estimates, conditions and assumptions.




                                      2

<PAGE>


                            OnLine Power Supply, Inc.

                                      Index

PART I.    FINANCIAL INFORMATION

ITEM 1.    Financial Statements

           Condensed Balance Sheets
           September 30, 2001 and December 31, 2000.........................4-5

           Condensed Statements of Operations -
           Three and Nine Months Ended
           September 30, 2001 and September 30, 2000..........................6

           Condensed Statements of Cash Flows - Nine Months Ended
           September 30, 2001 and September 30, 2000..........................7

           Notes to Condensed Financial Statements.........................8-10

ITEM 2.    Management's Discussion and Analysis of
           Financial Condition and Results of Operations..................11-14


PART II.   OTHER INFORMATION

ITEM 2.    Changes in Securities ............................................14

ITEM 4.    Submission of Matters to a Vote of Shareholders...................14

ITEM 6.    Exhibits and Reports on Form 8-K..................................14

           Signatures........................................................15



                                       3


<PAGE>


                            OnLine Power Supply, Inc.
                            Condensed Balance Sheets


<TABLE>
<CAPTION>

                                                          September 30,       December 31,
                                                               2001               2000
                                                          -------------       ------------
                                                           (unaudited)


<S>                                                        <C>                 <C>
Assets
Current assets
     Cash and cash equivalents                             $3,303,762          $3,181,728
     Certificates of deposit                                  150,000             650,000
     Short term investments                                 1,000,000           5,067,156
     Accounts receivable, net                                 313,771              29,819
     Accrued interest                                          35,020              50,239
     Receivable from officers                                 108,780              40,050
     Inventory, at lower of cost or market                    233,515              79,643
     Prepaid expenses                                         275,896             128,184
                                                           ----------          ----------
         Total current assets                               5,420,744           9,226,819

Property and intangibles, net of depreciation and
amortization, and other assets
     Property and equipment, net                              944,326             434,437
     Equipment under capital leases, net                       53,376              72,976
     Leasehold improvements, net                              115,163                --
     Goodwill                                                  69,812             104,718
     Acquired technology, net                                  31,850              50,960
     Patents, net                                              66,358              58,582
     Other assets                                                --                18,114
                                                           ----------          ----------
         Total property and other assets                    1,280,885             739,787
                                                           ----------          ----------
         Total assets                                      $6,701,629          $9,966,606
                                                           ==========          ==========
</TABLE>




                                       4


<PAGE>


                            OnLine Power Supply, Inc.
                      Condensed Balance Sheets (Continued)

<TABLE>
<CAPTION>

                                                                   September 30,          December 31,
                                                                      2001                    2000
                                                                   -------------          ------------
                                                                   (unaudited)
<S>                                                               <C>                    <C>
Liabilities and shareholders' equity

Current liabilities
     Accounts payable                                             $    475,988           $    379,836
     Accrued interest                                                   19,063                 19,063
     Capital lease obligations, current maturity                        39,060                 31,212
     Officer's retirement liability                                       --                  108,000
     Notes payable, current maturities                                  20,980                 19,840
     Accrued liabilities                                                34,212                   --
     Other                                                             239,206                 52,650
                                                                  ------------            -----------
         Total current liabilities                                     828,509                610,601
                                                                  ------------            -----------
Long-term liabilities
     Capital lease obligations, less current maturities                  2,465                 33,329
     Note payable, less current maturities                               7,346                 23,226
         Total long term liabilities                                     9,811                 56,555
                                                                  ------------            -----------
              Total liabilities                                        838,320                667,156
                                                                  ------------            -----------
Shareholders' equity
     Preferred stock, $.0001 par value; 1,000,000 shares
         authorized 2,800 shares issued and outstanding                   --                     --
     Common stock; $.0001 par value; 100,000,000
          shares authorized; 21,243,155 shares issued
         and outstanding                                                 2,124                  2,124
     Stock option notes receivable                                     (83,127)               (83,127)
     Additional paid-in capital                                     29,342,882             29,277,729
     Accumulated (deficit)                                         (23,398,570)           (19,897,276)
                                                                  ------------            -----------
         Total shareholders' equity                                  5,863,309              9,299,450
                                                                  ------------            -----------
Total liabilities and shareholders' equity                        $  6,701,629           $  9,966,606
                                                                  ============           ============
</TABLE>


                                       5


<PAGE>


                            OnLine Power Supply, Inc.
                  Unaudited Condensed Statements of Operations

<TABLE>
<CAPTION>

                                 Three Months      Three Months       Nine Months       Nine Months
                                     Ended             Ended             Ended             Ended
                                 September 30,     September 30,     September 30,     September 30,
                                     2001              2000              2001               2000
                                 ------------      ------------      ------------      ------------
<S>                              <C>               <C>               <C>               <C>
Revenue                          $    946,734      $     20,848      $  1,895,974      $     48,959
Cost of Revenue                       717,073            28,634         1,793,857            42,162
                                 ------------      ------------      ------------      ------------
Gross profit (loss)                   229,661            (7,786)          102,117             6,797
                                 ------------      ------------      ------------      ------------
Operating expenses:
Research and development              282,561           317,991         1,292,447           894,670
Stock based compensation                 --             359,607            65,153           363,113
Sales and marketing                   292,945            70,530           840,058           211,844
General and administrative            494,136           372,819         1,662,793         1,512,971
                                 ------------      ------------      ------------      ------------
Total operating expenses            1,069,642         1,120,947         3,860,451         2,982,598

(Loss) from operations               (839,981)       (1,128,733)       (3,758,334)       (2,975,801)


Interest & Investment Income          58,313            165,913           275,081           391,459
Interest (expense)                    (4,781)            (6,343)          (18,041)          (29,960)
                                 ------------      ------------      ------------      ------------
Net                              $    53,532       $    159,570      $    257,040      $    361,499

Net (loss)                       $   (786,449)     $   (969,163)     $ (3,501,294)     $ (2,614,302)
                                 ------------      ------------      ------------      ------------

Net loss per common share        $       (.04)     $       (.05)     $       (.16)     $       (.14)
                                 ============      ============      ============      ============

Weighted average shares
     outstanding                   21,243,155        19,808,175        21,243,255        18,404,254

</TABLE>


                                       6


<PAGE>


                            OnLine Power Supply, Inc.
                  Unaudited Condensed Statements of Cash Flows
<TABLE>
<CAPTION>

                                                                            For the Nine Months Ended
                                                                                   September 30
                                                                           -----------------------------
                                                                                2001            2000
                                                                           ------------     ------------
<S>                                                                        <C>              <C>
Cash flows from operating activities
     Net (Loss)                                                            $(3,501,294)     $(2,614,302)
     Adjustments to reconcile net loss to net cash:
         Depreciation and amortization                                         261,544          142,124
         Stock notes receivable                                                   --            (93,280)
         Stock based compensation                                               65,153          363,113
         Options issued for services                                              --             63,783
         Common stock issued for services                                         --            219,997
         Impairment loss on fixed assets                                          --              7,331
     Changes in certain assets and liabilities
         Receivables, inventory and other current assets                      (620,932)        (549,274)
         Accounts payable and other current liabilities                        208,920         (119,767)
                                                                           -----------      -----------
              Net cash provided by (used in) operating activities           (3,586,609)      (2,580,275)
                                                                           -----------      -----------
Cash flows from investing activities
     Payment of leasehold improvements                                        (132,230)            --
     Purchases of equipment                                                   (668,890)        (232,080)
     Payments to acquire patent                                                (19,637)         (37,220)
     Maturity of certificates of deposit                                       500,000          450,000
     Sale of short-term investments                                          5,067,156             --
     Purchase of short-term investments                                     (1,000,000)      (4,959,182)
                                                                           -----------      -----------
              Net cash provided by (used in) investing activities            3,746,399       (4,778,482)
                                                                           -----------      -----------
Cash flows from financing activities
     Proceeds from sale of stock                                                  --          8,792,417
     Payments for offering costs                                                  --         (1,355,059)
     Payments on capital leases                                                (23,016)         (20,705)
     Payments on line of credit                                                   --               (731)
     Principal debt repayments                                                 (14,740)            --
     Proceeds from long term debt                                                 --             47,800
                                                                           -----------      -----------
              Net cash provided by (used in) financing activities              (37,756)       7,463,722
                                                                           -----------      -----------

Net increase in cash                                                           122,034          104,965

Cash and cash equivalents- beginning of period                               3,181,728        1,941,367
                                                                           -----------      -----------
Cash and cash equivalents- end of period                                   $ 3,303,762      $ 2,046,332
                                                                           ===========      ===========
</TABLE>


Supplemental disclosure of cash flow information:

Cash paid for interest  expense during the nine months ended  September 30, 2001
and September 30, 2000 was $18,041 and $29,960 respectively.

                                       7


<PAGE>


                            ONLINE POWER SUPPLY, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 1 - ACCOUNTING POLICIES
----------------------------

Basis of Presentation
---------------------

In the  opinion of  management,  the  accompanying  balance  sheets and  related
interim statements of income and cash flows include all adjustments,  consisting
only of normal  recurring  items,  necessary  for  their  fair  presentation  in
conformity  with  U.S.  generally  accepted  accounting  principles.   Preparing
financial  statements requires management to make estimates and assumptions that
affect the reported amounts of assets, liabilities, revenue and expenses. Actual
results may differ from these  estimates and assumptions and interim results are
not necessarily indicative of the results for the full year.

Annual Versus Interim Statements
--------------------------------

The  interim   financial   statements  are  presented  in  accordance  with  the
requirements  of SEC  Form  10-QSB  and  therefore  may not  include  all of the
disclosures  made in the SEC Form 10-KSB annual report filing.  These  financial
statements  should  be read in  conjunction  with  management's  discussion  and
financial  analysis  included in the SEC Form  10-QSB and the audited  financial
statements and notes included in the 2000 SEC Form 10-KSB.

NOTE 2 - SHAREHOLDERS' EQUITY
-----------------------------

Qualified Stock Option Plan
---------------------------

The shareholders approved a Qualified Incentive Stock Option Plan on December 7,
1999.  The purpose  for the plan is to have the  ability to offer  stock  option
incentives  to reward key  employees  for past  performance  and to attract  the
best-qualified  new employees  through the use of stock options as an additional
means of  compensation.  A total of 3,500,000  common shares have been set aside
for this plan;  no new stock  options  were granted  during the current  quarter
period.

Non Qualified Options:
---------------------

The company did not award any  non-qualified  stock  option  awards  during this
current quarter.

Stock Option Plan for Non-Executive Directors
---------------------------------------------

The Board of Directors adopted a Directors'  Non-Qualified  Stock Option Plan in
August 2000 to provide for stock options to non-employee  members serving on the
Board.  The plan will be used to attract  and retain  the most  qualified  board
members by awarding them stock options as a form of compensation. 300,000 shares
of common stock are designated for future issuance on exercise of these options.
There were no new options  granted  this  quarter and 30,000  options  have been
issued to date from the plan to the three non-employee directors.

NOTE 3-STOCK OPTION NOTES RECEIVABLE
------------------------------------

The company's Incentive Stock Option Plan (ISOP) administrators allow (beginning
October  2000)  employee ISOP  participants  to borrow funds from the company to
option common stock after the "cashless"  method of exercise was eliminated from
the plan provisions. The stock purchase advances are evidenced by recourse notes
from  the  employee  to  the  company  bearing  interest  at 8% per  annum.  The
outstanding  stock option  exercise notes payable to the company at December 31,
2000 and September 30, 2001 total $83,127 plus interest.


                                       8


<PAGE>


NOTE 4 - INCOME TAXES
---------------------

A  reconciliation  of the US statutory  federal income tax rate to the effective
rate follows:

<TABLE>
<CAPTION>
                                                      September30,     September 30,
                                                      ------------     -------------
                                                           2001             2000
                                                           ----             ----

<S>                                                     <C>               <C>
U.S. statutory federal rate                              34.00%            34.00%
State income tax rate, net of federal benefit             3.00%             3.00%
Provision for bad debts                                    --                --
Net operating loss for which no tax benefit
     is currently available                             (37.00%)          (37.00%)
                                                        -------           --------

                                                           --   %            --    %
                                                        =========         ==========
</TABLE>


Deferred taxes consisted of:
<TABLE>
<CAPTION>

                                                      September 30,        September 30,
                                                          2001                2000
                                                      -------------        -------------
<S>                                                   <C>                 <C>
Deferred tax asset as a result of a net operating
     tax loss carry-forward (beginning 1996)          $  3,192,000        $  1,748,290
Valuation allowance                                     (3,192,000)         (1,748,290)

Net deferred taxes                                    $     --            $     --

</TABLE>


The  valuation  allowance  offsets the deferred tax assets for which there is no
assurance  of  recovery.  The net  operating  losses  prior  to 1996  have  been
permanently lost due to the significant  changes in the business  operations and
changes in  ownership  in 1996.  The losses  since 1996 may be limited,  but not
lost, as a result of the significant  changes in ownership during 1999 and 2000.
The available  1996 forward NOL is based on the  estimated  time during the year
2000 that the greater than 50% ownership  change  threshold  occurred,  thereby,
resulting in the loss being partially  limited in its future use as a carry over
against current taxes due.

NOTE 5 - CONTINGENCIES AND COMMITMENTS
--------------------------------------

Office and Laboratory Space
---------------------------

The  company's  headquarters  is  in  the  Highland  Park  business  complex  in
Englewood,  Colorado in leased space subject to a five-year  net lease  expiring
February 28, 2006. Future minimum lease payments payable under the net lease are
$440,377 at $8,309 per month.

Performance Options
-------------------

As part of their executive  employment  agreements,  two officers (including the
retired CEO) shall become  fully vested to receive  options to purchase  150,000
shares each (300,000 in total) of the company's  common stock upon achieving the
following performance goals: If the company's consolidated gross revenues exceed
$9,000,000  for the year ended  December 31, 2001,  the  executives  vest in the
options; if this event does not occur, the options will not be granted.



                                       9


<PAGE>


Manufacturing
-------------

The  company  has  entered  into an  arrangement  with  Saturn  Electronics  and
Engineering  Inc.  (Saturn) for the turnkey  manufacture of the initial products
developed by the company.  Saturn may, if requested by the company, assist us in
financing certain one time costs normally associated with the production ramp-up
process and be  reimbursed  prorata out of the proceeds of payments  received by
the company.  Subject to certain terms and  conditions,  Saturn has the right to
manufacture  all of the products  developed  by OnLine  through the end of their
first product development program.

NOTE 6- LITIGATION
------------------

The company has settled and  satisfied  all claims that have arisen from a prior
business endeavor except for one known as Max Music (claiming $390,000) that was
litigated with the Federal  Magistrate's ruling given in favor of the company in
1999.  The ruling is now being  reviewed by the Federal  District  Court and the
final outcome is yet to be received. Management has been advised by counsel that
it is likely the company will prevail.  However, as with all litigation results,
the actual  outcome  will not be known  until the process is  completed;  in the
meantime,  management  believes  that  the  eventual  outcome  will not have any
adverse financial effect on the company.

NOTE 7 - DEVELOPMENTAL TECHNOLOGY RISKS AND REVENUE GENERATION
--------------------------------------------------------------

The company is bringing  its  proprietary  power  conversion  technology  to the
market in the form of the 48 volt,  500 watt to 1,000 watt line of products that
are expected to compete  favorably  against  existing power supplies for certain
targeted  applications  and customers.  Original  equipment  manufacturer  (OEM)
customers  have been targeted for our existing  product and the upcoming 48 volt
power supplies soon to be released.  The introduction process can be complex and
lengthy;  however,  significant  customer interest is being shown as a result of
our  marketing  efforts.   The  company  has  aimed  its  product  research  and
development  towards creating "more power in a smaller box";  customer  feedback
indicates  that this new  discovery  will  allow  them to  design to the  market
demands in the near future.  Due to the  uncertainties  of  introducing  the new
product in an entrenched market, we are unable to predict with accuracy when, or
if, net sales  revenues  will be adequate to cover the  operating  overhead  and
result in net profits.




                                       10


<PAGE>


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
        AND RESULTS OF OPERATIONS

BUSINESS STRATEGY

     The company is  producing a power factor  corrected  front end module (PFC)
and  delivering  evaluation  units to a wide array of  potential  customers  for
various  applications.  One large customer is incorporating  the PFC module as a
strategic  component to power their wireless  telecommunications  equipment more
efficiently.  The  technology  used to  produce  the  proprietary  PFC has  been
incorporated  into the 48 volt,  500 watt and 1,000  watt AC-DC  power  supplies
currently  under  development  and being tested.  The very  favorable  operating
characteristics  shown  by the PFC  module  is  stimulating  widespread  advance
customer interest in the 48 volt power supply and its potential applications.

     The goal of the company is to be the innovative  leader in the power supply
industry by successfully  introducing its  proprietary  power supply  technology
thereby allowing original equipment  manufacturer's (OEM) design engineers their
sought  after  advantage  when  incorporating  the  technology  into new systems
design.  The  release  of the PFC in late  2000 has  permitted  the  company  to
demonstrate the new  technology,  validate its design-in  value,  educate design
engineers and identify  industry OEM's and other large-scale power supply users.
Most of the  resulting  PFC product  interest is expected to flow through to the
applications for the 48 volt power supplies as well.

     Substantial  progress has been made towards the company's goal; however, it
should be noted that a greater than normal  business risk is usually  associated
with the process of introducing  breakthrough  product  technology by an unknown
company in a market  environment  that has not seen  significant  product design
advancements  for many years.  The  education  of the market place has begun (in
1999 and 2000),  but the  acceptance  exercise for many large OEM companies (our
target audience) is a very long, methodical, tedious and time-consuming process.
We are proud to report that a growing list of companies  have  invested the time
to  understand  the value of our  upcoming 48 volt power  supply and  management
believes that prototype unit  demonstrations  in the fourth  quarter,  2001 will
confirm these customers'  interests and possibly generate significant orders for
product next year.

     Recent  extraordinary  events, the general slowing of the worldwide economy
and the "near  recession"  levels of the United  States  economy  have  affected
OnLine Power  Supply,  Inc. and its  potential  customers.  The result will be a
lowering  of our  revenue  realization  for  the  remainder  of  2001.  However,
management  does  not  believe  that  the 48 volt  power  supply  and PFC  sales
expectations  need to be lowered at this time for 2002 as the market  conditions
are expected to improve and the demand for the 48 volt product,  once  released,
is more diverse and more immediate in nature.  The company continues to position
itself for the release of the 48 volt products and is fully prepared to meet the
expected  production  demands by  utilizing  the  turnkey,  dedicated  Saturn de
Monterrey,  Mexico manufacturing facility already in place and producing the PFC
products.

RESULTS OF OPERATIONS

Revenues
--------

     Sales of GlitchMaster  circuitry and customized components totaling $20,848
during  the third  quarter  of 2000 was the  result of the  final  sell-down  of
discontinued  items in inventory  prior to the beginning of the sales of the new
power  factor  corrected  front end modules in 2001.  Sales of the new PFC began
slowly during the first quarter of this year and have been  increasing in volume
quarter over quarter.  Revenue from the sales of the new units totaled  $946,734
in the third quarter 2001;  however,  the remainder of the year expectations are
now revised to produce a quarter over quarter drop in revenue (see footnote 7 to
financial  statements:  Market  Risks).  This  decline  in PFC  sales  began  in
September,  2001 and will continue into the fourth quarter.  It is partially due
to the extent of the worldwide economic downturn and more specifically, the push
out and cancellation of some orders of our telecommunications sector customer as
they  transition  from current  product  design to the next  generation  product
design..  As predicted,  the improved gross profit of $229,661 from sales during
the third quarter was the direct result of more  favorable  product  pricing and
the lowering of the overall manufacturing costs by Saturn, our manufacturer.

Research and Development Costs
------------------------------

         An ongoing program to develop the existing power conversion  technology
(PFC) into a series of commercially  accepted products started early in 2000 and
continues  at an  accelerated  pace today  resulting  in the  release of the PFC
module  in 2000 and the  substantial  completion  of the 48 volt and 500 watt to
1,000 watt prototype power supply unit.  Following in-house testing now underway
on the 48 volt  supply,  evaluation  units  will be  delivered  to a  number  of
potential  customers  for  acceptance  and  compliance  testing  prior  to their
specifying  the  product  for their own system  uses.  Independent  testing  and
certification  should be started and  completed  shortly on the final version of
the 48 volt power supply.  Research and development  costs typically  include a)
salaries  and  benefits of engineers  and  technicians  b) the cost of component
materials and supplies to build test models, c) costs of independent testing and
certification  of the  finished  design  and d) the  direct  cost of  space  and
equipment  dedicated  to the  development  effort.  All  indirect  costs  of the
laboratory  operations  that can be identified  and  attributed to the origin or
improvement  of specific  patents will be capitalized  for accounting  purposes.
Approximately  16-18 people are employed  continuously in the effort underway in
our in-house laboratory facility. The financial impact of increasing the size of
the laboratory staff,  adding much more testing equipment and more than doubling
the size of the physical  space  produced a year over year increase in operating
cost of  approximately  44% from $894,670 to $1,292,447 for the respective  nine
month periods ending September 30, 2000 and 2001.

General and Administrative Expenses
-----------------------------------

         The headquarters  and laboratory  facility were relocated in March 2001
to a space over twice as large as the former space and included the build out of
laboratory  space  more  conducive  to the level or  research  being  done.  For
example, an anti-conductive, anti-static tile floor was installed at significant
expense  throughout  the lab area and  standardized  workstations  installed  to
enable a more orderly and efficient  arrangement of the work areas.  This growth
and these  improvements  caused the general costs of the operations to increase,
but not proportional to the space size. Additional laboratory testing and design
equipment,   new  computer   network   capabilities   and  new  voice  and  data
communications  were  incorporated  into  the  design  of the  space to serve us
adequately for the foreseeable  future. The total  administrative  costs for the
third  quarter,  2000 were $372,819  compared to $494,136 for the third quarter,
2001,  an  increase of  approximately  33% period over  period.  Following  is a
schedule of the major expense  increases  that occurred this quarter as a result
of the  relocation,  expansion  and  upgrading of our  facilities:  office lease
expense $3,173,  information technology services $27,590, telephone and internet
costs $6,069, and depreciation of leasehold costs and equipment $53,045.

Sales and Marketing
-------------------

     The  greatest  cost  increases  quarter  over  quarter  and year  over year
occurred in the sales and marketing  area with the  initiation of an advertising
and marketing campaign to brand the company and the technology that began fourth
quarter  2000.  The total cost of sales and  marketing  expense for 2000 year to
date was  $211,844  (prior to the new program  impact)  versus  $840,058 for the
current  year to date, a four-fold  increase (as a result of the new  campaign).
The in-house  staff  expanded  from two sales person to two  directors,  a sales
associate and support staff



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<PAGE>


thereby causing an increase in salary expenses  totaling $34,413 for the current
quarter.  Direct print  advertising  costs increased by $93,790 this quarter and
sales  commissions  of $55,033 were paid this quarter this year compared to none
the previous year's quarter.  The company's  approach to sales and marketing has
been in place for approximately one year and involves outsourced advertising and
marketing  support,   direct  and  commissioned  sales  representatives,   print
advertising,  trade show  participation,  an  internet  website and a network of
power industry  proven  distributors  world wide. The costs of maintaining  this
professional  sales and  marketing  program  averages  $200,000 to $250,000  per
quarter,  fluctuating principally due to the amount of advertising and given the
existing program goals and parameters.  Early results indicate that the focus of
the  campaign  has  produced  steady and  acceptable  results and should lead to
additional  PFC orders and 48 volt customer  leads during the remainder of 2001.
Also  evident is the  longer-term  educational  results  for the  potential  OEM
customer to begin to think about  adaptation  of the new  technology  into their
long-term product planning processes.

FINANCIAL CONDITION

     When the  company  was  re-focused  in 1999 and 2000 to its new  technology
research  for the power  supply  industry,  it also  successfully  raised $ 14.2
million of new private equity capital to provide a solid financial foundation to
sustain a period of operational  growth during which there would be insufficient
net operating  revenues.  The present cash  resources of  $4,450,000  represents
twelve  months cash in the bank for the  support of the company  without any net
sales  revenues and at the current  burn rate.  All cash  resources  (except the
checking  account cash) are  currently  invested in  institutional  money market
accounts or  equivalent  liquid  instruments.  The interest  earnings  have been
reducing  quarter over quarter due to the  lowering of the  investment  interest
rates and the lowering of the amount of cash for investment.

     Accounts  receivable,  all current and  collectible,  have increased as the
result of the growth of sales from $29,819  last year to $313,771  this year and
is principally from one large customer.  Inventory  consists of production parts
and other raw  materials  (components)  to support  the long lead  manufacturing
supply for the out sourced  manufacturing  process.  Prepaid expenses  increased
from  $128,814 to $275,896  year over year  largely due to the costs  associated
with  the  establishment  of  the  automated   manufacturing  process,   prepaid
insurance,  and prepaid marketing expense,  all of which will be recognized in a
future accounting period.

     The current  quick  ratio  (ability to pay bills on time) is 9.4 to 1.0 and
the overall current ratio (indicating liquidity) is 6.5 to 1.0, both measurement
results indicating excellent operational financial health at this time. The debt
to  equity  ratio is .14 to 1.0  which is  superior  to  industry  averages  and
indicates a near term comfort level pending the expected  creation of profitable
operations sometime within the next twelve months.

     The company has not incurred  any new debt this  quarter and has  routinely
paid down all of its note and finance lease obligations pursuant to their agreed
upon terms over the past quarter and nine months.  All of our trade payables are
paid in the normal  course of business  and within  pre-arranged  credit  terms;
accounts payable has increased slightly as the amount of business increases from
quarter to quarter.

     Management has historically placed idle funds in cash equivalents,  such as
institutional money market accounts,  and other short term investments,  such as
high grade commercial paper, to achieve the highest  investment  earnings within
the investment program.  Consequently,  the balance sheet shows cash equivalents
and  short  term  investments  in  varying  degrees.  During  this  quarter,  an
investment  of  $1,000,000  was placed into a short term  government  instrument
backed mutual fund to achieve higher earnings with the remainder of cash left in
the money market funds.


                                       13

<PAGE>

     Based on our  current  business  plan and  operating  strategy,  management
believes that the current financial  resources and potential  borrowing capacity
are sufficient to fund the company's working capital,  capital  expenditures and
other normal cash  requirements for the next twelve months.  However,  sustained
growth and the  completion  of the 48 volt product  development  followed by the
production ramp up process may require the company to seek a combination of debt
and additional equity capital to maintain operations into next year.  Additional
funding, if required and provided,  would likely improve the confidence level of
larger  companies  desiring  to enter into a business  relationship  with OnLine
Power Supply, Inc.

     Once the company owes income taxes,  it will be able to use the  offsetting
benefits of an estimated $8,000,000 net income tax loss carry forward (from 1996
forward)  which can be applied to future income tax  liabilities.  However,  the
loss may be limited in its use, by income tax  regulations,  and may expire over
time if not fully utilized. This NOL represents a significant potential economic
benefit to the  company in the form of lower  future  income tax  payments  that
would otherwise be due and payable without the carry forward.



                           PART II. OTHER INFORMATION


ITEM 2.   CHANGES IN SECURITIES AND USE OF PROCEEDS.

     No activity to report for this current quarterly period.


ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SHAREHOLDERS.

     None


ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K.

    (a)   Exhibits.  None

    (b)   Reports on Form 8-K.  The company did not file any reports on Form 8-K
          during the quarter ended September 30, 2001.





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<PAGE>


                                   SIGNATURES



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

                                       ONLINE POWER SUPPLY INC.
                                       (Company)




Date:  November 12, 2001               By:     /s/   Kris Budinger
                                            ------------------------------------
                                                      KRIS BUDINGER,
                                                      CEO and President




Date:  November 12, 2001               By:     /s/   Richard L.  Millspaugh
                                            ------------------------------------
                                                      RICHARD L. MILLSPAUGH,
                                                      Chief Financial Officer


                                       15