UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                                 FORM 10-QSB

  [X}   QUARTERLY report under section 13 or 15(d) of the Securities
   Exchange Act of 1934 for the PERIOD ended NOVEMBER 30, 2000.

  [ ]   Transition report under section 13 or 15(d) of the Securities
   Exchange Act of 1934.


COMMISSION FILE NUMBER: 33-55254-43

                       Virtual Gaming Enterprises, Inc.
            (Exact name of registrant as specified in its charter)

        Nevada                                       87-0485308
 (State of Organization)                       (I.R.S. Employer
                                                   Identification No.)

                   2580 SEASCAPE GLEN, ESCONDIDO, CA 92026
                   (Address of Principal Executive Offices)

Registrant's Telephone Number, Including Area Code:  (760) 510-0188

Check whether the issuer: (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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  [ ]

    Transitional Small Business Disclosure Format: Yes [ ] No [X]

      2,576,322 Common Shares, $0.001 Par Value, Issued and Outstanding

     1

<PAGE>

                                    PART I
                            FINANCIAL INFORMATION

             Virtual Gaming Enterprises, Inc.
            (A Development Stage Enterprise)
                    Balance Sheets
<TABLE>
<S>                                      <C>            <C>
                                         November 30,      May 31,
                                            2000           2000
                                         ----------     ----------
ASSETS
CURRENT ASSETS
   Cash                                  $        0     $  109,142
   Advance receivable - related party       104,506         62,333
                                         ----------     ----------
     Total current assets                   104,506        171,475
<P>
PROPERTY AND EQUIPMENT
   Equipment                                  5,000          5,000
   Less: accumulated depreciation            (3,334)        (2,500)
                                         ----------     ----------
      Total property and equipment            1,666          2,500
<P>
OTHER ASSETS
   Intangible assets                      3,375,000      3,375,000
   Less: accumulated amortization                 0              0
                                         ----------     ----------
   Net intangibles                        3,375,000      3,375,000
   Investment - EBB Venture Capital          50,000         50,000
   Investment - Vegas Book, Ltd             320,000        320,000
                                         ----------     ----------
      Total other assets                  3,745,000      3,745,000

Total Assets                             $3,851,172     $3,918,975
                                         ==========     ==========
<P>
LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIENCY)
<P>
CURRENT LIABILITIES
   Bank overdraft                        $   33,265     $        0
   Accrued salaries payable                 282,466        204,007
   Short-term notes payable               1,629,348      1,550,309
     Litigation payable                     261,250        250,000
                                         ----------     ----------
     Total current liabilities            2,206,329      2,004,316
                                         ----------     ----------
Total Liabilities                         2,206,329      2,004,316
<P>
STOCKHOLDERS EQUITY (DEFICIENCY)
   Common stock, $0.001 par value,
     authorized 25,000,000 shares;
     38,548,247 and 2,181,822 issued
     and outstanding shares with 20,000,000
     Shares of Treasury Stock held at par
     value                                   18,548          8,288
   Additional paid-in capital             3,515,604      3,423,963
   Deficit accumulated during
     the development stage               (1,889,309)    (1,517,592)
                                         ----------     ----------
     Total Stockholders
           Equity (Deficiency)            1,644,843      1,914,659
                                         ----------     ----------
Total Liabilities and Stockholders
           Equity (Deficiency)           $3,851,172     $3,918,975
                                         ==========     ==========
<P>
The accompanying notes are an integral part of the financial statements.
</TABLE>
                              F-3

<PAGE>
              Virtual Gaming Enterprises, Inc.
              (A Development Stage Enterprise)
                 Statements of Operations
            For the six months ended November 30,
<TABLE>
<S>                         <C>             <C>              <C>
                                                             Period from
                                                             November 1997
                                                             (Inception) through
                                2000            1999         November 30, 2000
                            ------------    ------------    -------------------
Revenues                    $          0    $          0    $                 0
<P>
Expenses
   Compensation:
      Officers                   178,250         124,000                702,110
      Other                       12,000           6,750                 39,673
      Consultants                  8,500               0                 79,060
   General and
      administrative expenses     73,344         625,785                471,035
   Depreciation                      833             834                  3,333
   Research and development        8,500          29,010                120,500
                            ------------    ------------    -------------------
    Total expenses               281,427         786,379              1,415,711
                            ------------    ------------    -------------------
Loss from operations            (281,427)       (786,379)            (1,415,711)
                            ------------    ------------    -------------------
Interest (expense)               (90,290)              0        	     (223,598)
Loss from litigation                   0               0               (250,000)
                            ------------    ------------    -------------------
Net loss                    $   (371,717)   $   (786,379)   $        (1,889,309)
                            ============    ============    ===================
Basic net loss per
    weighted average share  $      (0.02)   $      (0.02)
                            ============    ============
Weighted average
    number of shares          18,281,159      23,209,647
                            ============    ============
<P>
The accompanying notes are an integral part of the financial statements.
<PAGE>
              Virtual Gaming Enterprises, Inc.
              (A Development Stage Enterprise)
                 Statements of Operations
            For the three months ended November 30,

</TABLE>
<TABLE>
<S>                         <C>             <C>



                                2000            1999
                            ------------    ------------
Revenues                    $          0    $          0
<P>
Expenses
   Compensation:
      Officers                   100,750          38,000
      Other                        6,500           2,000
      Consultants                  1,000           8,225
   General and
      administrative expenses     36,585         189,363
   Depreciation                      417             417
   Research and development        4,000               0
                            ------------    ------------
    Total expenses               149,252         238,005
                            ------------    ------------
Loss from operations            (149,252)       (238,005)
                            ------------    ------------
Interest (expense)               (45,259)              0
Loss from litigation                   0               0
                            ------------    ------------
Net loss                    $   (194,511)   $   (238,005)
                            ============    ============

<P>
The accompanying notes are an integral part of the financial statements.

</TABLE>
                              F-4
<P>
<PAGE>
              Virtual Gaming Enterprises, Inc.
              (A Development Stage Enterprise)
         Statement of Changes in Stockholders Equity
            From Inception through November 30, 2000
<TABLE>
<S>                 <C>           <C>     <C>         <C>          <C>
                                                      Deficit
                                                      Accumulated
                                          Additional  During the   Total
                    Number        Common  Paid-in     Development  Stockholders'
                    Of Shares     Stock   Capital     Stage        Equity
                    ------------  ------  ----------  -----------  -------------

BEGINNING BALANCE,
  November 1997
   (Inception)                 0  $    0  $        0  $         0  $           0

Shares issued
  for cash            13,000,000  46,400           0            0         46,400
Net loss                       0       0           0      (20,506)       (20,506)
                    ------------  ------  ----------  -----------  -------------
BALANCE,
  May 31, 1998        13,000,000  46,400           0      (20,506)        25,894
<P>
June 1998 - reverse
  merger              10,209,647 (44,079)     44,109            0             30
<P>
February 1999 -
  reverse split      (22,707,774) (1,819)      1,819            0              0
<P>
Shares issued
  for cash             1,679,949   1,680     184,382            0        186,062
<P>
Net loss                       0       0           0     (311,214)      (311,214)
                    ------------  ------  ----------  -----------  -------------
BALANCE,
  May 31, 1999         2,181,822   2,182     230,310     (331,720)       (99,228)
<P>
Shares issued
  for cash             6,105,879   6,106   3,193,653            0      3,199,759
<P>
Net loss                                               (1,185,872)    (1,185,872)
                    ------------  ------  ----------  -----------  -------------
BALANCE,
 May 31, 2000          8,287,701   8,288   3,423,963   (1,517,592)     1,914,659
<P>
Shares issued
 for cash              1,093,880   1,094      33,640                      34,734
<P>
Shares issued
  to officers for
  compensation under
  stock option and
  compensation plan    9,166,666   9,166     58,001                      67,167
<P>
Shares issued for
 Treasury             20,000,000  20,000                                 20,000
<P>
Shares held
 as Treasury stock   (20,000,000)(20,000)                               (20,000)
<P>
Net loss                                                  (371,717)    (371,717)
                     ----------- -------   -----------  -----------  ------------
Balance,
 November 30, 2000    18,548,247  18,548   $3,515,604  $(1,889,309)   $1,644,843
                     =========== =======   ===========  ===========  ============
<P>
The accompanying notes are an integral part of the financial statements.
</TABLE>
                              F-5
<PAGE>
              Virtual Gaming Enterprises, Inc.
              (A Development Stage Enterprise)
                   Statement of Cash Flows
   For the Quarters Ended and Period Since Inception Ended November 30,
<TABLE>
<S>                           <C>          <C>              <C>
                                                            Period from
                                                            November 1997
                                                            (Inception) through
                                  2000           1999       November 30, 2000
                              ------------   ------------   -------------------

CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss                      $   (371,717)  $   (786,379)  $        (1,889,309)
Adjustments to reconcile net
 loss to net cash used
 for operating activities:
    Depreciation                       833            834                 3,334
    Stock compensation              67,167                               67,167
Changes in operating
 assets and liabilities:
    (Increase) decrease advance
      receivable - related party   (42,173)        14,824              (104,506)
    Increase (decrease) accrued
      salaries payable              78,459       (172,967)              282,466
    Increase (decrease) accrued
      Interest                      79,039		  0	            212,347
    Increase (decrease) accrued
      Litigation payable            11,250              0               261,250
                              ------------   ------------   -------------------
Net cash used by
  operating activities            (177,142)      (943,688)           (1,167,251)
                              ------------   ------------   -------------------
<P>
CASH FLOW FROM INVESTING ACTIVITIES:
  Purchase of property
    and equipment                        0              0                (5,000)
  Purchase of investments                0              0              (340,000)
  Acquisition of
    intangible assets                    0       (369,172)           (1,958,001)
                              ------------   ------------   -------------------
Net cash (used) provided by
  investing activities                   0       (369,172)           (2,303,001)
                              ------------   ------------   -------------------
<P>
CASH FLOW FROM FINANCING ACTIVITIES:
     Proceeds from issuance
       of common stock              83,000      1,690,164             3,485,252
     Cash paid on Common
       stock fund raise            (48,265)             0               (48,265)
                              ------------   ------------   -------------------
Net cash provided by
  financing activities              34,735      1,690,164             3,436,987
                              ------------   ------------   -------------------

Net increase
  (decrease) in cash              (142,407)       377,304               (33,265)

CASH, beginning of period          109,142         (5,251)                    0
                              ------------   ------------   -------------------
<P>
CASH, end of period           $    (33,265)  $    141,435   $           (33,265)
                              ============   ============   ===================
</TABLE>
<P>
The accompanying notes are an integral part of the financial statements.

                              F-6
<PAGE>
              VIRTUAL GAMING ENTERPRISES, INC.
              (A Development Stage Enterprise)
               NOTES TO FINANCIAL STATEMENTS
<P>
(1) SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
    THE COMPANY   Virtual Gaming Enterprises, Inc. is a
Nevada chartered development stage corporation which
conducts business from its headquarters in Escondido,
California.  The Company was incorporated on August 9, 1990.
The operating company, now dissolved, was established in
November 1997.
<p>
    The Company has not yet engaged in its expected
operations.  The Company's future operations will be to
provide casino gambling via the Internet.  Current
activities include raising additional equity and negotiating
with potential key personnel and facilities.  There is no
assurance that any benefit will result from such activities.
The Company  will not receive any operating revenues until
the commencement of operations, but will nevertheless
continue to incur expenses until then.
<P>
    The following summarize the more significant accounting
and reporting policies and practices of the Company:
<P>
        A) START-UP COSTS Costs of start-up activities,
including organization costs, are expensed as incurred, in
accordance with Statement of Position (SOP) 98-5.
<P>

        B)  NET LOSS PER SHARE Basic is computed by dividing
the net loss by the weighted average number of common shares
outstanding during the period.
<P>
        C) USE OF ESTIMATES  The financial statements have
been prepared in conformity with generally accepted
accounting principles.  In preparing the financial
statements, management is required to make estimates and
assumptions that affect the reported amounts of assets and
liabilities as of the date of the statements of financial
condition and revenues and expenses for the period then
ended.  Actual results may differ significantly from those
estimates.
<P>
        D) PROPERTY AND EQUIPMENT  All property and
equipment are recorded at cost and depreciated over their
estimated useful lives, using the straight-line method.
Upon sale or retirement, the costs and related accumulated
depreciation are eliminated from their respective accounts,
and the resulting gain or loss is included in the results of
operations.  Repairs and maintenance charges which do not
increase the useful lives of the assets are charged to
operations as incurred. Depreciation expense was $833 and $0
for the periods ended May 31, 1999 and 1998, respectively.
<P>
        E) SIGNIFICANT ACQUISITION  In June 1998, Interbet,
Inc. issued 13,136,539 shares of common stock to acquire all
of the issued and outstanding shares of the common stock of
Virtual Gaming Enterprises, Inc. (VGEI) in a reverse merger,
accounted for as a reorganization of VGEI.
<P>
        F) PRINCIPLES OF CONSOLIDATION  The consolidated
financial statements include the accounts of Virtual Gaming
Enterprises, Inc. (VGEI) and its wholly owned subsidiary and
majority owned subsidiary.  Inter-company balances and
transactions have been eliminated.
<P>
(2) ADVANCES RECEIVABLE - RELATED PARTIES   The Company has
advanced $104,506 to officers of the Company.  These advances
are due on demand and carry no stated interest rate.
<P>
(3) STOCKHOLDERS' EQUITY   The Company has authorized
25,000,000 shares of $0.001 par value common stock.  The
Company had 8,287,701 shares of common stock issued and
outstanding at May 31, 2000.  The Company, in August 1990,
issued 1,000,000 shares for $1,000 in cash.  In August 1996,
the Company issued 100,000 shares for $50,000 in cash.  In
December 1997, the Company issued 4,973,108 shares in
conjunction with the acquisition of Interbet, Inc.  In June
1998, the Company issued 2,000,000 shares in exchange for
services valued at $313,200.  In June 1998, the Company
issued 600,000 shares in settlement of a loan amounting to
$93,957.  In June 1998, the Company issued 1,400,000 shares
for $46,400 in cash. In June 1998, the Company
<P>
                           F-7
<PAGE>
            VIRTUAL GAMING ENTERPRISES, INC.
           (A Development Stage Enterprise)
            NOTES TO FINANCIAL STATEMENTS
<P>
(3) STOCKHOLDERS' EQUITY (CONTINUED) issued 13,136,539
shares for the acquisition of Virtual Gaming Enterprises,
Inc.  In February 1999, the Company completed a reverse
split of its common stock, leaving 501,873 shares issued and
outstanding.  During the fourth quarter of fiscal 1999, the
Company issued 1,679,949 shares for $186,062 in cash.
During the Year ended May 31, 2000, the Company issued
6,105,879 shares for $3,169,759.  During the quarter ending
August 31, 2000, the Company paid out of additional paid in
capital $48,265 for raising these funds.  During the quarter
ending November 30, 2000, the Company raised 83,000 in cash.
<P>
(4) INCOME TAXES  Deferred income taxes (benefits) are
provided for certain income and expenses which are
recognized in different periods for tax and financial
reporting purposes.  The Company has net operating loss
carry-forwards for income tax purposes of approximately
$1,694,798, expiring $20,506 at May 31, 2018, $311,214 at
May 31, 2019 and $1,185,872 at May 31, 2020 and $177,207 at May 31, 2021.
<P>
The amount recorded as deferred tax assets is approximately
$227,639 and $50,000 as of May 31, 2000 and May 31, 1999,
respectively, and $283,395 at November 30, 2000, which
represents the amount of tax benefit of the loss carryforward.
The Company has established a 100% valuation allowance against
this deferred tax asset, as the Company has no history of
profitable operations.
<P>
(5) GOING CONCERN As shown in the accompanying financial
statements, the Company incurred a net loss of $1,694,799
for the period from November 1997 (Inception) through August
31, 2000.  The ability of the Company to continue as a going
concern is dependent upon commencing operations and
obtaining additional capital and financing.  The financial
statements do not include any adjustments that might be
necessary if the Company is unable to continue as a going
concern.  The Company is currently seeking financing to
allow it to begin its planned operations.
<P>
(6) RELATED PARTIES  As discussed in Note 2, the Company
extended an advance to an officer.  Related party balances
and amounts for the period since inception, (November 1997),
ended November 30, 2000 are as follows:
<P>
   Advance receivable - related party       $104,506
                                            ========
<P>
(7) INTANGIBLE ASSETS During the year ended May 31, 2000,
the Company Entered into agreements for the development of
software that Will provide gaming capabilities on the
internet.  The Company has Invested $2,093,001 during the
year for 17 of these programs.  The Company plans to lease
and/or manage these sites for a fee.  In May 1999, the
Company formed Hung Sai, Ltd., a Nevis Corporation.  In May
1999, Hung Sai entered into a license agreement with a third
party to provide an Internet gateway for future Internet
casinos to be located in St. Kitts, West Indies.  This

agreement required a $60,000 initial license fee and future
revenue sharing from the Company's future on-line casinos.
The Company expects to amortize the license fee over a five-
year period, once commercialization has begun.
<P>
(8) COMMITMENTS AND CONTINGENCIES  EMPLOYMENT AGREEMENTS In
July 1998, the Company entered into employment agreements
with two of its officers.  These agreements have three-year
terms expiring June 30, 2001.  The agreements contain base
pay amounts of $250,000, $280,000 and $325,000, combined.
These contracts also call for the issuance of options for
3,000,000 shares of the Company's common stock, 1,500,000 of
which vested on December 1, 1998, and 150,000 per month
beginning June 1, 1999 for a period of ten months.
<P>
(9) LEGAL PROCEDINGS   On or about June 11, 1999, the United
States Securities and Exchange Commission initiated a
proceeding in the United States District Court, Southern
District of California, against the Company seeking to hold
the Company in Civil Contempt for failure to respond to a
Subpoena issued by the Commission.  The Court granted the
Commission's request and issued an Order that sanctioned the
Company Ten Thousand ($10,000.00) Dollars per day until such
time as it complied with the Commission's Subpoena.
<P>
Subsequent to the Company's compliance with the Commission's
Subpoena, the Company and the Commission entered into a
Stipulation and Order whereby the Company, having purged
itself of the civil contempt citation, agreed to pay and did
pay Ten Thousand ($10,000.00) Dollars as a sanction. The
Stipulation and Order was signed by the Court and filed on
or about November 18, 1999.
<P>
Virtual Gaming Enterprises, Inc., and its President, Virgil
Williams, in or about May, 2000, submitted Offers of
Settlement to the United States Securities and Exchange
Commission that stemmed from certain matters reviewed by the
Commission.
<P>
The Company, without admitting or denying any wrongdoing,
consented to entry of an Order by the Commission that:
<P>
     A)     Orders it to cease and desist from committing or
causing any violation, and any future violation, of Section
13(a) of the Exchange Act and Rules 13a-1 and 13a-13
thereunder; and
<P>
     B)      Orders the effectiveness of Virtual Gaming's
Form S-8 be suspended.
<P>
On July 24, 2000, the Company and the Commission agreed to
modify a portion of this Offer of Settlement to reflect
that, "As a result of Virtual Gaming's failure to meet its
reporting obligations, the Form S-8 never became effective."
<P>
Virgil Williams, without admitting or denying any
wrongdoing, consented to entry of an Order by the Commission
that:
<P>
     A)     Orders him to cease and desist from committing
or causing any violation, and any future violation, of
Section 17(a) of the Securities Act and Section 10(b) of the
Exchange Act and Rule 10b-5 thereunder.
<P>
Both of these Offers of Settlement have yet to be acted upon
by the Commission.
<P>
     In a civil proceeding filed in the United States
District Court for the Eastern District of New York in
January 2000, identified by Case Number 00 CIV 0276,
Platinum I.T. Consulting, Inc., and Edward Marian, alleged
that Virtual Gaming Enterprises, Inc., Virgil Williams,
Brenda Williams and others violated Section 12(1) of the
Securities Act, Violated Section 10(b) of the Exchange Act
and Rule 10b-5 thereunder, Breached their Contract(s) with
Plaintiff(s), Fraudulently Induced Plaintiff(s) to purchase
the Company's securities, Converted Plaintiff(s) funds, and
were Unjustly Enriched at Plaintiff's expense. Plaintiffs
sought damages in excess of Five Million ($5,000,000.00)
Dollars.
<P>
The Company deemed it in its best interest to resolve this
matter, as the costs and fees for defense would largely
outweigh the costs of resolution. Accordingly, without
admitting or denying the allegations in the Complaint, the
Company and Virgil and Brenda Williams entered into a
Settlement and Consent Judgment whereby they agreed to
compensate the Plaintiffs in the amount of $170,00.00 within
75 days of the effective date of the Settlement and Consent
Judgment.
<P>
Due to the hospitalization of the Company's President Virgil
Williams, the Company did not make payment as required under
the Settlement and Consent Judgment. As a result, and by the
terms and provisions of the Settlement and Consent Judgment,
the Settlement Obligation has increased to $250,000.00. The
Company expects to remit this amount to the Plaintiffs, in
care of Plaintiffs' Attorney, in short order.
<P>
On February 14, 2000, the State of Indiana, Office of the
Secretary of State, Securities Division, filed an
Administrative Complaint against Virtual Gaming Enterprises,
Inc., Virgil Williams and others, alleging that all
Respondents sold and/or offered for sale certain securities
in violation of Indiana State Law. On this same date, the
Indiana Securities Division requested and received a Cease
and Desist Order.
<P>
On March 2, 2000, Virtual Gaming Enterprises, Inc., and
Virgil Williams filed their Answer and Affirmative Defenses
to the Administrative Complaint and demanded an immediate
administrative hearing pursuant to the terms and provision
of the Indiana Securities Act that requires a hearing to be
set within 45 days of the Indiana Securities Division.
Virtual Gaming Enterprises, Inc., and Virgil Williams have
and do expressly deny any and all allegations made against
them in the Administrative Complaint.
<P>
Counsel for the Company and Mr. Williams, having not had a
response to the hearing demand, provided the Indiana
Securities Division a second copy of the Answer and
Affirmative Defenses and Demand for Hearing via facsimile on
March 17, 2000. Subsequent to March 17, 2000, Counsel for
the Company made several attempts to contact the Indiana
Securities Division via telephone, leaving messages for the
Deputy Commissioner, Enforcement, who apparently is
responsible for this proceeding. The Indiana Securities
Division has never responded to the Demand for Hearing or
the telephonic inquiries of counsel.
<P>
Finally, in January or February 2000, Virtual Gaming
Enterprises, Inc., was named as a Defendant in a Complaint
for Interpleader filed in the Third Judicial District Court
in and for Salt Lake County, State of Utah, and identified
as Civil No. 000901201. Therein, National Stock Transfer,
Inc., the transfer agent for the Company's Stock, due to
competing demands for certain certificates. This action
remains pending.
<P>
10. SHORT-TERM LIABILITIES The Company entered into 17
agreements whereby they have invested funds with
International Business Assoc. Corp. to develop the software
for internet gaming sites.  The agreements mature on April
1, 2003 and accrue interest at a rate of 10%.  Each
agreement calls for a quarterly payment of $14,153.  The
principal and accrued interest, at the option of the holder,
become immediately due if a quarterly payment is 10 days
late.  As of May 31, 2000 the Company entered into an
informal agreement for prepayment of these notes as funds
become available.
<P>
11. Cash Flows The company has paid no interest or taxes during
the year ended May 31, 2000 and the quarters ended November 30,
2000 and 1999.  The Company has funded the purchase of intangible
assets through notes payable.  During the quarter ended
November 30, 2000 the Company issued stock as compensation in
accordance with the officer's compensation agreements in the amount
of $67,167.
                           F-8
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations

Plan of Operation

The Registrant is continuing its efforts to provide management of,
rent of or sales of casino gambling via the internet.  The casinos
are currently in the testing stage of their development.  It is
possible that the registrant will be successful in this plan of
operation; however, there is no assurance for success.

Results of Operation

The Company did not have any operating income during the quarters
ended November 30, 2000 and 1999.  For quarter  ended November 30,
2000, the registrant recognized a net loss of $194,511.  Some
compensation expenses, general and administrative, research and
development were accrued.  All of the interest expense of $45,259
was accrued.  Expenses for general and administrative were comprised
of costs mainly associated with legal and accounting fees.

Liquidity and Capital Resources

At November 30, 2000 the Company had raised $83,000 from the
issuance of stock. $48,265 had been paid in association with raising
capital for this year and the prior year.  The Company also issued
9,166,666 shares stock, 2,000,000 valued at .03 per share and
7,166,666 valued at .001 per share, as compensation to officers in the
amount of $67,167 per agreements created during 1998.  This amount
does not represent stock issued for cash as the value was charged as
officer compensation.  The Company had no other capital resources other
than funding casinos with notes payable from the creators of those
casinos and the possibly of raising operating capital through the sale
of additional common stock.

<PAGE>

                                   Part II
                              OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

   The company is not currently involved in any litigation. The Company was
   the subject of an Administrative Proceeding filed by the securities and
   Exchange Commission, file number 33-55254-43 regarding a cease-and-desist
   proceeding and stop order proceeding instituted pursuant to Section 8(d)
   of the Securities Act of 1933 and Section 21C of the Securities Exchange
   Act of 1934. Without admitting or denying the findings of these
   proceedings the Company agreed to cease-and-desist from committing or
   causing any violation, and any future violation, of Section 13(a) of the
   Exchange Act and Rules 13a-1 and 13a-13 there under and agreed to the
   suspension of the Company's Form S-8.

ITEM 2.   CHANGES IN SECURITIES
   Inapplicable/None.

ITEM 3.   DEFAULTS UPON SENIOR SECURITIES
   Inapplicable/None.

ITEM 4.   SUBMISSION OF MATTER TO A VOTE OF SECURITY HOLDERS
   Inapplicable/None.

ITEM 5.   OTHER INFORMATION
   Inapplicable/None.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

           A.  EXHIBITS

 Exhibit Number        Status          Title
   2                  (*)         Plan of acquisition, reorganization,
                                   arrangement, liquidation, or succession
   3(I)               (*)         Articles of Incorporation
   3(II)              (*)         By-laws
   4                  (*)         Instruments defining the rights of
                                   security holders including indentures
                                   (N/A)
   10                 (*)         Material Contracts
   11                 (*)         Statements re: computation of per share
                                  earnings
   15                 (**)        Letter on unaudited interim financial
                                  information
   18                 (*)         Letter on change in Accounting
                                  Principals (N/A)
   19                 (*)         Reports furnished to security holder
                                  (None)
   22                 (*)         Published report regarding matters
                                   submitted to vote (N/A)
   23                 (*)         Consents of Experts and Counsel
   24                 (**)        Power of Attorney
   27                 (**)        Financial Data Schedule
   99                 (*)         Additional Exhibits (N/A)

      ---------------------------------------
        (*)  Incorporated by reference on Form 10-KSB filed on May 1, 2000.

        (**) Provided herewith.


      B.  REPORTS ON FORM 8-K

          None

     4
<PAGE>
<P>
                       SIGNATURES
<P>
Pursuant to the requirements of Section 13 or 15(d) of
the Securities Exchange Act of 1934, the Registrant has
duly caused this 10-KSB report to be signed on its behalf
by the undersigned thereunto duly authorized.
<P>
                           VIRTUAL GAMING ENTERPRISES, INC.
                           (Registrant)
<P>
Date: January 22, 2001     /s/ Virgil G. Williams
                              -------------------------
                              Virgil G. Williams
                              President