UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549



(Mark One)
                                    FORM 10-Q
[X]               QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                For the Quarterly Period Ended December 31, 2000

                                       OR

[ ]             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          0-13084

                             WARRANTECH CORPORATION
             (Exact name of registrant as specified in its charter)

                  Delaware                                    13-3178732
    (State or other jurisdiction of                         (I.R.S. Employer
    incorporation or organization)                          Identification No.)

150 Westpark Way, Euless TX                                      76040
(Address of principal executive offices)                      (Zip Code)

Registrant's telephone number, including area code             (800) 544-9510

(Former name, former address and former fiscal year, if changed since last year)

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X]   No [_]

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

           Class                                Outstanding at January 31, 2001
Common stock, par value $.007 per share                 15,104,557 shares



<PAGE>


                     WARRANTECH CORPORATION AND SUBSIDIARIES


                                    I N D E X


                                                                       Page No.
PART I - Financial Information:


         Item 1.  Financial Statements

            Condensed Consolidated Balance Sheets at December 31, 2000
            (Unaudited) and March 31, 2000...................................3

            Condensed Consolidated Statements of Operations
              For the Three and Nine months Ended December 31, 2000
              and 1999 (Unaudited) ..........................................4

            Condensed Consolidated Statements of Cash Flows
              For the Nine Months Ended December 31, 2000
              and 1999 (Unaudited)...........................................5

            Notes to Condensed Consolidated Financial Statements.............6

             Item 2.  Management's Discussion and Analysis of
                      Financial Condition and Results of Operations .........10



PART II  - Other Information.................................................13

Signatures      .............................................................14


<PAGE>


                     WARRANTECH CORPORATION AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

                                   A S S E T S

                                                    (Unaudited)
                                                    December 31,    March 31,
                                                         2000            2000
                                                    ------------    ------------
Current assets:
Cash and cash equivalents                           $ 10,079,167    $ 10,035,003


Investments in marketable securities                   3,660,212       4,638,875



Accounts receivable, (net of allowances of
 $803,725 and $1,164,125, respectively)               14,511,980      11,858,653
Other receivables, net                                 5,841,304       2,416,248
Income tax receivable                                  4,741,603       4,035,346
Deferred income taxes                                    507,376         926,321
Prepaid expenses and other current assets              1,229,843       1,238,051
                                                    ------------    ------------
   Total current assets                               40,571,485      35,148,497
                                                    ------------    ------------





Property and equipment, net                           12,362,576      15,417,255

Other assets:

Excess of cost over fair value of assets
acquired
(net of accumulated amortization of
$6,371,426 and  $5,550,861, respectively)              1,787,107       2,607,671
Deferred income taxes                                  4,140,910       8,279,643
Deferred direct costs                                 54,893,528      80,797,199
Investments in marketable securities                   1,536,511       1,499,247
Restricted cash                                          800,000         800,000
Split dollar life insurance policies                     708,262         827,262

Notes receivable                                         640,672       1,167,725
Collateral security fund                                    --           199,389
Other assets                                             171,584         177,266
                                                    ------------    ------------
          Total other assets                          64,678,574      96,355,402


                                                    ------------    ------------
                    Total Assets                    $117,612,635    $146,921,154
                                                    ============    ============




See accompanying notes to condensed consolidated financial statements.


<PAGE>



                              LIABILITIES AND STOCKHOLDERS' EQUITY
                              ------------------------------------
<TABLE>
<CAPTION>
                                                                                               (Unaudited)
                                                                                               December 31,              March 31,
                                                                                                  2000                    2000
                                                                                              -------------           -------------
<S>                                                                                          <C>                     <C>
Current liabilities:
Current maturities of long-term debt and capital lease obligations                            $     883,602           $   1,451,020
Insurance premiums payable                                                                       23,107,716              18,161,357
Accounts and commissions payable                                                                  6,841,307               8,857,556
Accrued expenses and other current liabilities                                                    9,432,709               9,491,175
                                                                                              -------------           -------------
   Total current liabilities                                                                     40,265,334              37,961,108
                                                                                              -------------           -------------

Deferred revenues                                                                                72,254,051             105,028,425

Long-term debt and capital lease obligations                                                      1,307,448               1,668,478



Deferred rent payable                                                                               317,989                 384,501
                                                                                              -------------           -------------
   Total liabilities                                                                            114,144,822             145,042,512
                                                                                              -------------           -------------

Commitments and contingencies

Stockholders' equity:
   Preferred stock - $.0007 par value authorized - 15,000,000 Shares
     issued  - none at December 31, 2000 and March 31, 2000                                            --                      --
   Common stock - $.007 par value authorized - 30,000,000 Shares
     issued - 16,518,353 shares at December 31, 2000 and
     16,505,911 shares at March 31, 2000                                                            115,570                 115,541
   Additional paid-in capital                                                                    23,742,018              23,737,835
   Loans to directors and officers                                                               (9,738,630)             (9,505,406)
   Accumulated other comprehensive income, net of taxes                                             (51,820)               (144,132)
   Retained earnings (deficit)                                                                   (6,258,119)             (8,101,029)
                                                                                              -------------           -------------
                                                                                                  7,809,019               6,102,809
Treasury stock - at cost, 1,415,171 shares at December 31,
 and 1,211,024 shares  at March 31, 2000                                                         (4,341,206)             (4,224,167)
                                                                                              -------------           -------------
        Total Stockholders' Equity                                                                3,467,813               1,878,642
                                                                                              -------------           -------------

        Total Liabilities and Stockholders' Equity                                            $ 117,612,635           $ 146,921,154
                                                                                              =============           =============

</TABLE>


<PAGE>


                     WARRANTECH CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                 For the Three Months Ended           For the Nine Months Ended
                                                                         December 31,                        December 31,
                                                       ----------------------------------------------------------------------------
                                                                     2000             1999              2000             1999
                                                       ----------------------------------------------------------------------------
<S>                                                                <C>              <C>               <C>              <C>
Earned Administrative Fee                                          $ 11,724,995     $ 10,716,014      $ 37,022,003     $ 30,279,202
                                                                   ------------     ------------      ------------     ------------
    (Net of amortization of deferred costs)

Costs and expenses
   Service, selling, and general and administrative                   9,177,970       11,311,378        29,014,602       36,869,128
   Depreciation and amortization                                      1,476,477        1,504,709         4,858,697        4,375,387
   Loss on abandonment of assets                                                                         1,049,552
                                                                   ------------     ------------      ------------     ------------
Total costs and expenses                                             10,654,447       12,816,087        34,922,851       41,244,515
                                                                   ------------     ------------      ------------     ------------

Income (loss) from continuing operations                              1,070,548       (2,100,073)        2,099,152      (10,965,313)

Other income (expense)                                                  238,967          275,742           643,751          786,189
                                                                   ------------     ------------      ------------     ------------

Income (loss) before provision for income taxes                       1,309,515       (1,824,331)        2,742,903      (10,179,124)
Provision (benefit) for income taxes                                    399,588         (172,119)          899,993       (2,510,575)
                                                                   ------------     ------------      ------------     ------------

Net income (loss)                                                  $    909,927     ($ 1,652,212)     $  1,842,910     ($ 7,668,549)
                                                                   ============     ============      ============     ============

Earnings per share:
Basic                                                              $       0.06     ($      0.11)     $       0.12     ($      0.50)
                                                                   ============     ============      ============     ============
Diluted                                                            $       0.06     ($      0.11)     $       0.12     ($      0.50)
                                                                   ============     ============      ============     ============

Weighted average number of shares outstanding:
Basic                                                                15,280,549       15,196,263        15,318,259       15,214,422
                                                                   ============     ============      ============     ============
Diluted                                                              15,280,549       15,196,263        15,318,259       15,214,422
                                                                   ============     ============      ============     ============
</TABLE>




See accompanying notes to condensed consolidated financial statements.


<PAGE>





                     WARRANTECH CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                        For the Nine Months Ended
                                                                                               December 31,
                                                                                      2000                       1999
                                                                                   ------------             ------------
<S>                                                                                <C>                      <C>
Net cash flows from operating activities                                           $  1,131,231             $    925,322
                                                                                   ------------             ------------
Cash flows from investing activities:
  Property and equipment purchased-net of retirements                                (1,302,880)              (3,280,179)
  Purchase of marketable securities                                                    (475,000)              (3,600,000)
  Proceeds from sales of marketable securities                                        1,300,000                2,835,000
                                                                                   ------------             ------------
Net cash (used in) investing activities                                                (477,880)              (4,045,179)
                                                                                   ------------             ------------
Cash flows from financing activities:
    (Increase) decrease in notes receivable                                             527,053               (1,029,966)
    Exercise of common stock options and stock grants                                      --                      8,982
    Purchase treasury stock                                                            (308,920)
    Issuance of treasury stock                                                          191,881                  (37,191)
    Repayments, notes and capital leases                                             (1,019,201)              (1,252,697)
                                                                                   ------------             ------------
Net cash (used in) financing activities                                                (609,187)              (2,310,872)
                                                                                   ------------             ------------

Net increase (decrease) in cash and cash equivalents                                     44,164               (5,430,729)

Cash and cash equivalents at beginning of period                                     10,035,003               15,032,473
                                                                                   ------------             ------------
Cash and cash equivalents at end of period                                         $ 10,079,167             $  9,601,744
                                                                                   ============             ============

Supplemental Cash Flow Information:
Cash payments made during the period for:
   Interest                                                                        $    188,021             $    349,489
                                                                                   ============             ============
   Income taxes                                                                    $    265,599             $     95,238
                                                                                   ============             ============

Non-Cash Investing and financing activities:
    Property and equipment financed through capital leases                         $    399,195             $    616,830
    Increase in loans to officers and directors                                        (233,224)                (401,353)

</TABLE>

See accompanying notes to condensed consolidated financial statements.






<PAGE>





                     WARRANTECH CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                December 31, 2000
                                   (Unaudited)

1.  THE COMPANY

Warrantech, through its wholly owned subsidiaries, develops, markets and
administers service contracts and extended warranties. The Company is a third
party administrator for a variety of dealer/clients in selected industries and
offers call center and technical computer services. The Company assists
dealer/clients in obtaining insurance policies from highly rated independent
insurance companies for all contracts and programs offered. The insurance
company is then responsible for the cost of repairs or replacements for the
contracts administered by Warrantech.

The Company operates under three major business segments: Automotive, Consumer
Products and International. The Automotive segment markets and administers
extended warranties on automobiles, light trucks, recreational vehicles and
automotive components. These products are sold principally by franchised and
independent automobile dealers, leasing companies, repair facilities, retail
stores and financial institutions. The Consumer Products segment markets and
administers extended warranties on household appliances, electronics and homes.
These products include home appliances, consumer electronics, televisions,
computers, home office equipment and homes. These products are sold principally
by retailers, distributors, manufacturers, utility companies and financial
institutions. Warrantech also direct markets these products to the ultimate
consumer through telemarketing and direct mail campaigns. The International
segment markets and administers outside the United States predominately the same
products and services of the other business segments. The International segment
is currently operating in Central and South America, Puerto Rico and the
Caribbean.

The predominant terms of the service contracts and extended warranties range
from twelve (12) to eighty-four (84) months. The Company acts as a third party
administrator on behalf of the dealer/clients and insurance companies. The
actual repairs and replacements required under the service contract agreements
are performed by independent third party authorized repair facilities. The cost
of these repairs is borne by the insurance companies which have the ultimate
responsibility for the claims. The insurance policy indemnifies the
dealer/clients against losses resulting from service contract claims and
protects the consumer by ensuring their claims will be paid.

The Company's service contract programs benefit consumers with expanded and/or
extended product coverage for a specified period of time (and/or mileage in the
case of automobiles and recreational vehicles), similar to that provided by
manufacturers under the terms of their product warranties. Such coverage
generally provides for the repair or replacement of the product, or a component
thereof, in the event of its failure. The Company's service contract programs
benefit the dealer/clients by providing enhanced value to the goods and services
they offer. It also provides the opportunity for increased revenue and income
while outsourcing the costs and responsibilities of operating an extended
warranty program.

2.  BASIS OF PRESENTATION


The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X. Accordingly, they do not include all information and footnotes
required by generally accepted accounting principles for complete financial
statements. In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Operating results for the three and nine months ended December 31,
2000 are not necessarily indicative of the results that may be expected for the
year ending March 31, 2001. For further information, refer to the consolidated
financial statements and footnotes thereto included in the Company's Form 10K/A
for the year ended March 31, 2000.


<PAGE>

Certain prior year amounts may have been reclassified to conform to current year
presentation.
Revenue Recognition Policy - The Company's revenue recognition policy is
segregated into two distinct categories depending on whether the Company or the
retailer/dealer is designated as the obligor on the service contract sale. In
either case, a highly rated independent insurance company assumes all claims
liabilities of the service contracts administered by the Company.

Dealer obligor service contracts are sales in which the retailer/dealer is
designated as the obligor. For these service contract sales, using the
proportional performance method, the Company recognizes revenues in direct
proportion to the costs incurred in providing the service contract programs to
the Company's clients. Revenues in amounts sufficient to meet future
administrative costs and a reasonable gross profit thereon are deferred. Sales
of dealer obligor service contracts are reflected in gross revenues net of
premiums paid to insurance companies as well as related sales commissions
associated with the contracts.

Administrator obligor service contracts are sales in which Warrantech is
designated as the obligor. For these service contract sales, the Company
recognizes revenues in accordance with Financial Accounting Standards Board
Technical Bulletin 90-1 ("TB 90-1"), Accounting for Separately Priced Extended
Warranty and Product Maintenance Contracts, and Statement of Financial
Accounting Standards No. 60 ("SFAS 60"), Accounting and Reporting by Insurance
Enterprises. These accounting standards require the recognition of revenue over
the life of the contract on a straight-line basis, unless sufficient,
company-specific, historical evidence indicates that the costs of performing
services under these contracts are incurred on other than a straight-line basis.
The Company is recognizing revenue on administrative obligor contracts based on
company specific historical claims experience over the life of the contract.

3. COMPREHENSIVE INCOME


The components of comprehensive income are as follows:


<TABLE>
<CAPTION>
                                                                For the Three Months Ended            For the Nine Months Ended
                                           ----------------------------------------------------------------------------------------
                                                                        December 31,                       December 31,
                                           ----------------------------------------------------------------------------------------
                                                                  2000              1999              2000                1999
                                           ----------------------------------------------------------------------------------------
<S>                                                            <C>                <C>                <C>                <C>
Net income(loss)                                               $   909,927        ($1,652,212)       $ 1,842,910        ($7,668,549)
Other Comprehensive Income, net of tax
   Unrealized gain(loss) on investments                              6,626            (10,620)            13,393            (19,551)
   Foreign currency translation adjustments                           (115)            75,933             78,919             33,431
                                                               -----------        -----------        -----------        -----------
Comprehensive Income                                           $   916,438        ($1,586,899)       $ 1,935,222        ($7,654,669)
                                                               ===========        ===========        ===========        ===========

Comprehensive income per share:
Basic                                                          $      0.06        ($     0.10)       $      0.13        ($     0.50)
                                                               ===========        ===========        ===========        ===========
Diluted                                                        $      0.06        ($     0.10)       $      0.13        ($     0.50)
                                                               ===========        ===========        ===========        ===========

The components of accumulated                                 December 31,          March 31,
comprehensive income are as follows:                                 2000               2000
                                                              -----------        -----------

Unrealized gain/(loss) on investments                          ($    3,339)       ($   16,732)
Accumulated translation adjustments                                (48,481)          (127,400)
                                                               -----------        -----------
                                                              ( $   51,820)       ($  144,132)
                                                               ===========        ===========
</TABLE>


<PAGE>


4.  EARNINGS PER SHARE


<TABLE>
<CAPTION>
                                                               For the Three Months Ended        For the Nine Months Ended
                                                            ----------------------------------  ----------------------------
                                                                      December 31,                     December 31,
                                                            ----------------------------------  ----------------------------
                                                                      2000             1999             2000              1999
                                                            ----------------------------------  --------------    ------------
<S>                                                            <C>              <C>               <C>            <C>
     Numerator:
        Net income (loss) applicable to common stock            $  909,927      ($1,652,212)      $1,842,910      ($ 7,668,549)
                                                                ==========      ===========       ==========      ============
     Denominator:
         Average outstanding shares used in the
         computation of per share earnings:
           Common Stock issued-Basic shares                     15,280,549       15,196,263       15,318,259        15,214,422
           Stock Options (treasury method)                            --               --               --                --
                                                                ----------      -----------       ----------      ------------
           Diluted shares                                       15,280,549       15,196,263       15,318,259        15,214,422
                                                                ==========      ===========       ==========      ============
     Earnings Per Common Share:
        Basic                                                   $     0.06      ($     0.11)      $     0.12      ($      0.50)
                                                                ==========      ===========       ==========      ============
        Diluted                                                 $     0.06      ($     0.11)      $     0.12      ($      0.50)
                                                                ==========      ===========       ==========      ============
</TABLE>

In a net loss position options are anti-dilutive.

5.   SEGMENTS

The Company defines its operations into three business segments: Automotive,
Consumer Products and International. All Other includes general corporate income
and expenses, inter-segment sales and expenses and other corporate assets not
related to the three business segments.

<TABLE>
<CAPTION>

                                                   Consumer                          Reportable
Three Months Ended                Automotive       Products        International     Segments            Other          Total
                                ---------------   -------------   ---------------   --------------   --------------   ------------
December 31, 2000
<S>                              <C>              <C>              <C>              <C>              <C>              <C>
Earned administrative fee        $   2,509,866    $   9,023,575    $     266,511    $  11,799,952    ($     74,957)   $  11,724,995
Income (loss) from operations          682,982        3,995,214   ($     462,276)       4,215,920       (3,145,372)       1,070,548
Pretax Income (Loss)                  (384,685)       1,988,289   ($     556,781)       1,046,823          262,692        1,309,515
Net Interest Income                     17,309           39,314    $           0           56,623          176,904          233,527
Depreciation/Amortization              205,564          447,269    $      18,580          671,413          805,064        1,476,477

December 31, 1999
Earned administrative fee        $   2,347,422    $   8,240,856    $     223,405    $  10,811,683    ($     95,669)   $  10,716,014
Income (loss) from operations          335,080        2,564,012       (1,890,839)       1,008,253       (3,108,326)      (2,100,073)
Pretax Income (Loss)                  (628,008)         629,235       (2,632,118)      (2,630,891)         806,560       (1,824,331)
Net Interest Income                     12,782           31,179             (162)          43,799          291,418          335,217
Depreciation/Amortization              183,593          409,495          230,614          823,702          681,007        1,504,709

Nine Months Ended
December 31, 2000
Earned administrative fee        $  11,654,587    $  24,395,660    $   1,244,929    $  37,295,176    ($    273,173)   $  37,022,003
Income (loss) from operations        6,140,450        9,295,148         (384,381)      15,051,217      (12,952,065)       2,099,152
Pretax Income (Loss)                 3,202,205        3,690,129        7,546,446       14,438,780      (11,695,877)       2,742,903
Net Interest Income                     46,658           51,564          (15,853)          82,369          542,570          624,939
Depreciation/Amortization              628,391        1,388,672          750,128        2,767,191        2,091,506        4,858,697
Total Assets                        49,260,611       52,312,487        2,786,255      104,359,353       13,253,282      117,612,635
</TABLE>


<PAGE>


<TABLE>
<CAPTION>
December 31, 1999
<S>                              <C>              <C>              <C>              <C>              <C>              <C>
Earned administrative fee        $   7,818,247    $  20,978,554    $   2,027,510    $  30,824,311    ($    545,109)   $  30,279,202
Income (loss) from operations        1,510,651        1,160,243       (3,766,166)      (1,095,272)      (9,870,041)     (10,965,313)
Pretax Income (Loss)                (1,611,456)      (5,092,023)      (4,792,653)     (11,496,132)       1,317,008      (10,179,124)
Net Interest Income                     31,259           54,492              338           86,089          717,812          803,901
Depreciation/Amortization              553,858        1,139,977          668,499        2,362,334        2,013,053        4,375,387
Total Assets                        69,617,307       69,481,141        6,773,465      145,871,913       16,764,302      162,636,215
</TABLE>

6. SIGNIFICANT CUSTOMERS


The Company has one significant customer, Staples, which accounted for
approximately 13% and 10% respectively, of consolidated gross revenues for the
nine months ended December 31, 2000, and 1999. As a rate increase needed to
sustain profitability on the renewal of the service contract agreement with
Staples could not be reached, the Staples program will expire as of February 27,
2001. The loss of the Staples contract will have a significant adverse impact on
the amount of future earned administrative fees.


<PAGE>



                     WARRANTECH CORPORATION AND SUBSIDIARIES

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


Except for the historical information contained herein, the matters discussed
below or elsewhere in this quarterly report are forward looking statements that
involve risks and uncertainties. The Company makes such forward looking
statements under the provisions of the "safe harbor" section of the Private
Securities Litigation Reform Act of 1995. Forward looking statements are based
on management's beliefs and assumptions, as well as information currently
available to management. Such beliefs and assumptions are based on, among other
things, the Company's operating and financial performance over recent years and
its expectations about its business for the current fiscal year. Although the
Company believes that the expectations reflected in such forward looking
statements are reasonable, it can give no assurance that such expectations will
prove to be correct. Such statements are subject to certain risks, uncertainties
and assumptions, including (a) prevailing economic conditions may significantly
deteriorate, thereby reducing the demand for the Company's products and
services, (b) unavailability of technical support personnel or increases in the
rate of turnover of such personnel, reflecting increased demand for such
qualified personnel, (c) changes in the terms or availability of insurance
coverage for the Company's programs or (d) regulatory or legal changes affecting
the Company's business, although none of these risks are anticipated at the
present time. Should one or more of these or any other risks or uncertainties
materialize, or should the underlying assumptions prove incorrect, actual
results may vary materially from those anticipated, estimated or expected.

Results of Operations

Three Months Ended December 31, 2000 Compared to the Three Months Ended December
31, 1999


Net earned administrative fees for the three month period ended December 31,
2000 increased to $11,724,995 as compared with $10,716,014 for the same period a
year ago. This was an increase of $1,008,981 or 9.4%. The change was primarily
attributed to improved margins and increased revenues recognized from prior
periods. The Automotive segment increased earned administrative fees to
$2,509,866 from $2,347,422 for the December 31, 1999 quarter. The Consumer
Products segment increased to $9,023,575 from $8,240,856 for same in the period
prior year.

 Our South American and Puerto Rico markets also contributed higher volumes from
existing and new customers as earned administrative fees from the total
International segment increased to $266,511 from $223,405 for the quarter ended
December 31, 1999.

Service, selling and general and administrative expenses (SG&A) for the three
months ended December 31, 2000 were reduced by $2,133,408 or 18.9% to $9,177,970
as compared to $11,311,378 for the three months ended December 31, 1999. The
decrease in SG&A expenses reflects the Company's improved technologies,
cost-cutting measures and the closing of the United Kingdom operations as of
September 30, 2000. Total employee and payroll related costs were down 15% from
$6,170,737 for the quarter ended December 31, 1999 to $5,261,768 in the current
quarter.

Depreciation and amortization were reduced by $28,232 to $1,476,477 for the
three months ended December 31, 2000 as compared to $1,504,709 for the same
period last year due primarily to the closing of the United Kingdom operations
effective September 30, 2000.

Net income for the three months ended December 31, 2000 was $909,927 or $.06 per
diluted share compared to a net loss of ($1,652,212) or ($.11) per diluted share
for the comparable period last year. This change is the result of the
amortization of prior period deferred revenues and deferred costs being
recognized in the current year and the other factors listed above.


<PAGE>

Nine Months Ended December 31, 2000 Compared to the Nine Months Ended December
31, 1999

Earned administrative fees for the nine month period ended December 31, 2000
increased to $37,022,003 as compared with $30,279,202 for the same period last
year. This was an increase of $6,742,801 or 22.3% and is the result of higher
volume from existing and new customers and an increase in deferred revenue
recognition in the current quarter in the Automotive and Consumer Products
segment. Our South American and Puerto Rico markets also contributed higher
volumes from existing and new customers although earned administrative fees from
the total International segment declined from $2,027,510 for the nine months
ended December 31, 1999 to $1,244,929 in the current year primarily due to the
closing of the United Kingdom operations. Effective September 30, 2000, the
Company ceased operations in the United Kingdom. The closing was a result of
unprofitable operations and will immediately benefit the bottom line. Over the
past Fiscal Year Ended March 31, 2000 the United Kingdom operation produced
losses in excess of $4.1 million.

Service, selling and general and administrative expenses (SG&A) for the nine
months ended December 31, 2000 were reduced by $7,854,526 or 21.3% to
$29,014,602 as compared to $36,869,128 for the nine months ended December 31,
1999. The decrease in SG&A expenses reflects the Company's improved
technologies, cost-cutting measures and the closing of the United Kingdom
operations as of September 30, 2000.

Depreciation and amortization were $4,858,697 for the nine months ended December
31, 2000 as compared to $4,375,387 for the same period last year due primarily
to capital additions related to the Company's ongoing upgrade of its computer
systems.

The provision (benefit) for income taxes is based on the Company's projection of
its estimated effective tax rate for the fiscal year. The Provision for income
taxes for the nine months ended December 31, 2000 has been reduced by
approximately $400,000 resulting from the loss on abandonment of approximately
$1,050,000 of net assets from its United Kingdom operations.

Net income for the nine months ended December 31, 2000 was $1,842,910 or $0.12
per diluted share compared to a net loss of ($7,668,549) or ($0.50) per diluted
share for the comparable period last year. This change is the result of the
amortization of prior period deferred revenues and deferred costs being
recognized in the current year and the other factors listed above.

The foregoing Results of Operations include earned administrative fees of
approximately 13% from the contract with Staples for the nine months ended
December 31, 2000. As previously reported, negotiations for the renewal of the
Staples contract were unsuccessful and the contract will expire on February 27,
2001. The Company anticipates that the loss of the Staples contract will have a
significant impact on revenues in future periods following the expiration of the
contract. The Company is not able to determine at this time whether revenues
lost from the expiration of the Staples contract will be offset by revenues, if
any, from additional business from existing customers and new customers.

Liquidity and Financial Resources

         The primary source of liquidity during the current year was cash
generated by operations. Funds were utilized for working capital expenditures as
well as capital expenditures relating to the development of the Company's
information systems. The Company continues to maintain its cash position with a
slight improvement to $10,079,167 from $10,035,003 at March 31, 2000.

         The Company has ongoing relationships with equipment financing
companies and intends to continue financing certain future equipment needs
through leasing transactions. The total amount financed through leasing
transactions during the nine months ended December 31, 2000 amounted to
$399,195. The Company is presently in negotiations to obtain a bank line of
credit.


<PAGE>

         On July 6, 1998, Joel San Antonio, Warrantech's Chairman and Chief
Executive Officer, and William Tweed and Jeff J. White, members of Warrantech's
Board of Directors, exercised 3,000,000 of their vested options to purchase
Warrantech common stock. Promissory notes totaling $8,062,500 were signed with
interest payable over three years at an annual rate of 6%. The promissory notes,
which are with recourse and secured by the stock certificates issued, mature
July 5, 2001. An additional promissory note was signed by Joel San Antonio for
$595,634 on March 22, 1999, which represents the amounts funded by the Company
with respect to his payroll taxes for the exercise of these options. The
exercise of these stock options and the anticipated tax benefit from this
transaction total approximately $10 million. These amounts have been recorded as
a contra-equity account, which is a reduction of stockholders' equity.

         As of February 1, 2000, the Company agreed to restructure the loans to
Mr. Tweed and Mr. White by capitalizing the interest due on the loans and making
the loans payable over five (5) years. Interest on the new loans to Messrs.
Tweed and White accrues annually at the applicable federal rate (approximately
6.2%) but will first become payable on the third anniversary of the new loans
and will be payable annually thereafter. The Company has also agreed to
restructure the loans to Mr. San Antonio although the specific terms of the new
loan agreement with Mr. San Antonio are still being negotiated. The total amount
of the new loans, including the capitalized interest which accrued on the prior
loans through December 31, 2000, is approximately $9,738,630.

         Working capital at December 31,2000 was $306,151 and the Company
believes that internally generated funds will be sufficient to finance its
current operations for at least the next twelve months. The Company is
continuing its restructuring plan to consolidate operations and reduce costs.
This restructuring plan includes the reduction of operational and administrative
personnel, consolidation of office space and an overall review of service,
selling, general and administrative expenses.

         The effects of inflation have not been significant to the Company.


<PAGE>



PART II. Other Information

Item 1.       Legal Proceedings

                 The Company is from time to time involved in litigation
                 incidental to the conduct of its business.

     (A)         On December 9, 1999, a complaint and order to show cause were
     filed against Warrantech Automotive, Inc. in the Supreme Court of the State
     of New York by American Home Assurance Company, Illinois National Insurance
     Company, National Union Insurance Company of Louisiana and the New
     Hampshire Insurance Company (collectively, "AIG") in which AIG sought to
     inspect and copy certain books and records kept by Warrantech in the course
     of the business it conducted under a General Agency Agreement ("GAA") with
     AIG. On December 14, 1999, this action was removed by Warrantech to the
     United States District Court for the Southern District of New York. The
     action is entitled "American Home Assurance Co., et al, v. Warrantech
     Automotive, Inc., 99 Civ. 12040 (BSG)." At a December 16, 1999 hearing,
     Warrantech agreed to make the books and records at issue available to AIG
     for copying. On January 24, 2000 AIG made a motion to amend its complaint
     to add claims for replevin and a declaratory judgment seeking possession of
     the originals of the books and records and to add claims for breach of
     contract, breach of fiduciary duty, negligence and gross negligence based
     on allegations that Warrantech mishandled claims under the GAA. AIG seeks
     damages in excess of $20 million. AIG also moved for summary judgment (the
     "Motion for Summary Judgment") on its claims seeking possession of the
     books and records. Although the court has denied AIG's motion for summary
     judgment, the court has granted AIG permission to amend its complaint as
     set forth above. Warrantech believes that certain issues raised in the
     Service Guard litigation (described below) are also contained in this
     action as set forth in the amended complaint. Therefore, subsequent to the
     granting of the Motion to Amend in New York, Warrantech moved to have all
     of the issues between Warrantech and AIG consolidated in state court in
     Texas. The Texas court has granted that motion and AIG's appeals, to date,
     have been denied. A tentative trial date has been set for May of 2001.
     Warrantech is presently moving in the New York court to have the
     jurisdiction of the Texas court recognized and the New York litigation
     dismissed. Warrantech continues to believe that all of AIG's claims are
     without merit and will defend them vigorously. At present, the parties are
     working through an extensive deposition schedule.

     (B)         Service Guard Insurance Agency, Inc. ("Service Guard") v.
     Warrantech Automotive, Inc., New Hampshire Insurance Company, Ronald Glime
     and Christopher Ford, Cause No. 99-12650, pending in the 126th Judicial
     District Court of Travis County, Texas. Service Guard filed suit against
     Warrantech Automotive and New Hampshire Insurance Company on October 28,
     1999, seeking an injunction to transfer claims-handling administration over
     automobile warranty claims to a third-party, and seeking an unspecified
     amount of damages attributed to alleged improper claims handling and
     tortious interference with contract. Service Guard never pursued its
     original request for injunctive relief. On January 27, 2000, Service Guard
     amended its petition to add AIG Warranty Services as a defendant, again
     seeking to recover an unspecified amount of damages from all defendants. On
     February 2, 2000, Service Guard filed an application for a temporary
     restraining order against New Hampshire Insurance Company and AIG Warranty
     Services to mediate within twenty-one days the disputes that form the basis


<PAGE>

     for the requested injunctive relief. Warrantech, Ford and Glime believe
     Service Guard's claims against them are wholly without merit and intend to
     vigorously defend against those claims.

     Service Guard has amended its Complaint to (i) limit its claims against
     Warrantech Automotive, Inc. and (ii) adding Warrantech Corporation as a
     defendant. Warrantech Corporation and Warrantech Automotive, Inc. have
     filed an answer denying Service Guard's allegations and have also filed a
     cross-claim against New Hampshire Insurance Company and AIG Warranty
     Services of Florida, Inc.

     Warrantech has filed a claim for coverage of the above mentioned claims
     under an errors and omissions policy issued by National Union fire
     Insurance Company of Pittsburgh, PA., a member of the AIG family of
     insurance companies ("National Union"). On June 7, 2000, National Union
     filed a complaint in the Supreme Court of the State of New York, County of
     New York, against Warrantech Automotive, Inc. and Warrantech Corporation.
     The complaint seeks a declaration from the court that National Union has no
     obligation under the policy to pay any of the claims submitted. Warrantech
     believes National Union's position is without merit and is contesting the
     action vigorously.


     (C)        In the Matter of the Arbitration between ACE Property and
     Casualty Insurance Company f/k/a CIGNA Property and Casualty Insurance
     Company v. Warrantech Corporation, Warrantech Consumer Product Services,
     Inc., WCPS of Florida, Inc. and Warrantech Help Desk, Inc. In accordance
     with that certain Administrative Agreement, effective as of August 1, 1997,
     between the various Warrantech entities set forth above and CIGNA, ACE has
     made demand for arbitration in accordance with Section 18 of the Agreement.
     ACE asserts a variety of claims against the Warrantech entities that can be
     divided into two general categories. The first arise out of Warrantech's
     administration of its service contract program with CompUSA, both prior to
     and immediately following the termination of the relationship between
     Warrantech and CompUSA. The remaining claims relate to Warrantech's general
     claims handling procedures. Although all claims have not been set forth
     with specificity, it is evident that ACE is seeking to recover damages in
     an amount in excess of Five Million Dollars ($5,000,000)

     ACE has provided Warrantech with its Preliminary Statement and the
     arbitration panel has been appointed. On January 19, 2001, the parties met
     in Philadelphia to negotiate an arbitration schedule. As of the date
     hereof, Warrantech is preparing its response and discovery requests are
     being formulated. Warrantech believes the claims are without merit and
     intends to defend them vigorously.


     (D)        Staples the Office Superstore, Inc. v. ACE Property and
     Casualty Insurance Company, Warrantech Consumer Product Services, Inc. and
     Warrantech Help Desk, Inc., No. 2001-02277, District Court of Harris
     County, Texas. In accordance with a Service Contract Administration
     Agreement, Warrantech administered a service contract program for Staples.
     For a period of time, that program was underwritten by ACE Property and
     Casualty Insurance Company (f/k/a CIGNA Property and Casualty Insurance
     Company). In December 2000, ACE informed Warrantech that it was
     implementing changes in the process pursuant to which claims underwritten
     by ACE were to be adjusted and paid. Although Warrantech would continue to
     take inbound calls and validate coverage, ACE would now confirm diagnoses,
     dispatch service and pay servicer invoices. Shortly after implementation of
     these changes, Staples reported that it had witnessed a material increase
     in complaints from customers holding service contracts underwritten by ACE.
     These complaints were primarily focused on inordinate delays in service
     delivery. Although Staples discussed these problems with Warrantech, ACE
     continued to operate under the new claims handling procedures. In an effort
     to satisfy customer complaints, Staples states that it has spent a
     substantial amount of its own funds to repair or replace covered products.

     This action has two distinct components. Initially, Staples sought a
     Temporary Injunction against ACE and Warrantech. The motion, as filed,
     asked that (i) Staples be given control of the toll free telephone lines on
     which customers call for service and (ii) ACE be required to re-institute
     those claims handling procedures that were in place prior to December 2000.
     On January 22, 2001, a hearing was held on this motion. The parties have
     negotiated an Agreed Order pursuant to which claims underwritten by ACE
     will be handled on a go-forward basis. Staples is also pursuing an action
     for damages against both ACE and Warrantech. It seeks to recover the
     amounts it has spent to satisfy its customers and certain unspecified
     amounts representing loss of business and damage to its reputation. Its
     entitlement to these amounts is based on a variety of theories including
     breach of contract, fraud, and tortuous interference with business.


<PAGE>

     Warrantech believes the claims as asserted against it are without merit.
     Warrantech also believes it has meritorious claims against ACE arising out
     of these allegations which claims may be asserted in this litigation or in
     the arbitration referred to above.

     Warrantech is not able to estimate its potential liability in any of the
     above actions although Warrantech believes that these matters are without
     merit, and accordingly, no reserves for potential liabilities have been
     provided for either of these actions.











Item 2.       Changes in Securities

              Not applicable.

Item 3.       Defaults Upon Senior Securities

              Not applicable.

Item 4.       Submission of Matters to Vote of Security Holders

              Not applicable.

Item 5.       Other Information

              Not applicable.

Item 6 (a)    Exhibits

              (27)  Financial Data Schedule

Item 6 (b)    Reports on 8-K

              Not applicable


<PAGE>














                                   SIGNATURES


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



                                                WARRANTECH CORPORATION



                                                S/N/S  Joel San Antonio
                                                Joel San Antonio - Chairman of
                                                the Board
                                                Chief Executive Officer


Date: February 12, 2001

                                                S/N/S  Richard F. Gavino
                                                Richard F. Gavino - Executive
                                                Vice President and
                                                Chief Financial Officer


Date: February 12, 2001