SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q

(Mark One)

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

                For the quarterly period ended September 30, 2001

                                       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 No. 0-23226

                              GRILL CONCEPTS, INC.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

           Delaware                                              13-3319172
---------------------------------                         ----------------------
(State or other jurisdiction                                  (IRS Employer
of incorporation or organization)                            Identification No.)

        11661 San Vicente Blvd., Suite 404, Los Angeles, California 90049
        -----------------------------------------------------------------
               (Address of principal executive offices)(Zip code)

                                 (310) 820-5559
       -------------------------------------------------------------------
              (Registrant's telephone number, including area code)

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

         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

         As of November 8, 2001,  5,537,071 shares of Common Stock of the issuer
were outstanding.

<PAGE>

                              GRILL CONCEPTS, INC.

                                      INDEX



                                                                        Page
                                                                        Number
                                                                       --------

PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

         Consolidated Condensed Balance Sheets -
           September 30, 2001 and December 31, 2000....................    3

         Consolidated  Condensed Statements of Operations - For the
         three months and nine months ended September 30, 2001 and
         September 24, 2000.............................................    5

         Consolidated  Condensed  Statements of Cash Flows - For the
         nine months ended September 30, 2001 and September 24, 2000....    6

         Notes to Consolidated Condensed Financial Statements...........    7

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

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.....   16

PART II - OTHER INFORMATION

Item 2.  Changes in Securities and Use of Proceeds......................   17

Item 6.  Exhibits and Reports on Form 8-K...............................   17

SIGNATURES..............................................................   18

<PAGE>


                         PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS


                      GRILL CONCEPTS, INC. AND SUBSIDIARIES
                      CONSOLIDATED CONDENSED BALANCE SHEETS


                                     ASSETS


                                                 September 30,     December 31,
                                                    2001              2000
                                                 ----------        ------------
                                                 (unaudited)
Current assets:
     Cash and cash equivalents               $  2,221,833          $ 623,097
     Inventories                                  575,107            541,579
     Receivables                                  459,998            654,594
     Prepaid expenses                             626,985            270,672
                                               ----------        -----------

       Total current assets                     3,883,923          2,089,942

Furniture, equipment, & improvements, net       9,193,278          9,300,548

Goodwill, net                                     206,928            213,053

Liquor licenses                                   423,049            587,614

Other assets                                      365,017            342,921
                                             ------------      -------------

       Total assets                         $  14,072,195       $ 12,534,078
                                             ============      =============



  The accompanying notes are an integral part of these consolidated condensed
                             financial statements.

                                       3
<PAGE>


                      GRILL CONCEPTS, INC. AND SUBSIDIARIES
                      CONSOLIDATED CONDENSED BALANCE SHEETS
                                   (Continued)
             LIABILITIES, MINORITY INTEREST AND STOCKHOLDERS' EQUITY
<TABLE>

                                                        September 30,              December 31,
                                                               2001                   2000
                                                         (unaudited)
<S>                                                     <C>                         <C>

Current liabilities:
     Bank line of credit                              $      -                    $  100,000
     Accounts payable                                     1,353,302                1,420,591
     Accrued expenses                                     1,897,946                2,358,699
     Current portion of long term debt                      640,525                  737,881
     Note payable - related party                           289,735                  191,716
                                                         ----------               ------------
       Total current liabilities                          4,181,508                4,808,887

Long-term debt                                            1,594,245                2,408,151
Notes payable - related parties                             627,060                  458,132
                                                         ----------              ------------
       Total liabilities                                  6,402,813                7,675,170

Minority interest                                         2,002,258                1,363,494

Stockholders' equity:
  Series A, 10% Convertible Preferred Stock,
  $.001 par value; 1,000,000 shares
  authorized, none issued                                        --
        and outstanding in 2001 and 2000
  Series B, 8% Convertible  Preferred Stock,
  $.001 par value;  1,000,000 shares
         authorized, none issued
         and outstanding in 2001 and 2000                         -                       -
Series I, Convertible Preferred Stock, $.001 par
     value; 1,000,000 shares authorized, none
     issued and outstanding in 2001 and 2000                      -                       -
  Series II, 10% Convertible Preferred Stock, $.001 par value;
  1,000,000 shares,
     authorized, 500 shares
     issued and outstanding in 2001 and 2000                      1                       1
  Common stock, $.00004 par value; 12,000,000 shares
     authorized in 2001 and 7,500,000 shares authorized
     in 2000, 5,537,071 shares issued and outstanding in 2001
     4,203,738 shares issued and outstanding in 2000            221                     168
  Additional paid-in capital                             12,933,405              11,071,055
  Accumulated deficit                                    (7,266,503)             (7,575,810)
                                                        -----------              -----------
     Total stockholders' equity                           5,667,124               3,495,414
                                                        -----------              -----------
       Total liabilities, minority interest and
           stockholders' equity                         $14,072,195             $12,534,078
                                                        ===========              ===========
</TABLE>


  The accompanying notes are an integral part of these consolidated condensed
                             financial statements.

                                       4
<PAGE>


                      GRILL CONCEPTS, INC. AND SUBSIDIARIES
                 CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
                                   (Unaudited)
<TABLE>


                                                    Three Months Ended                 Nine Months Ended
                                             -------------------------------   ----------------------------------
                                             September 30,  September 24,       September 30,        September 24,
                                                2001            2000                2001                 2000
<S>                                          <C>            <C>                 <C>                  <C>

Revenues:
     Sales                                  $ 9,954,799      $10,761,965        $33,276,149          $31,632,970
     Management and license fees                185,482          170,754            599,081              466,844
                                             -----------    -------------       ------------          -----------
       Total revenues                        10,140,281       10,932,719         33,875,230           32,099,814
Cost of sales                                 2,826,505        3,261,674          9,335,733            9,209,959
                                             -----------    -------------       ------------          -----------
Gross profit                                  7,313,776        7,671,045         24,539,497           22,889,858

Costs and expenses:
     Restaurant operating expenses            6,202,824        6,456,468         20,489,476           18,777,825
     General and administrative                 845,729          912,490          2,742,943            2,588,453
     Depreciation and amortization              319,009          344,606            975,295              927,974
     Preopening costs                                 -                -                  -              457,928
                                             -----------     ------------       ------------          -----------
       Total operating expenses               7,367,562        7,713,564         24,207,714           22,752,180

Income (loss) from operations                   (53,786)         (42,519)           331,783              137,678
Interest expense, net                          (164,668)        (152,638)          (358,003)            (333,295)
Gain on disposal of assets                      225,042                -            225,042                    -
                                             -----------    -------------       -------------         -----------
Income (loss) before provision for
income taxes, equity in loss of joint
venture and minority interest                     6,588         (195,157)           198,822             (195,617)

Provision for income taxes                       (2,502)          (7,500)            (4,372)             (13,100)
Equity in income (loss) of joint venture            357                -             (4,033)              (9,469)
Minority interest                                49,740           82,472            118,890              250,838
                                             -----------   --------------       -------------         -----------

Net (loss) income                                54,183         (120,185)           309,307               32,652
Preferred dividends accrued or paid             (12,500)         (12,500)           (37,500)             (37,500)
                                             -----------   --------------       -------------         -----------

Net (loss) income available to
 common stockholders                            $41,683       $ (132,685)          $271,807           $   (4,848)
                                             ===========   ==============       =============         ===========

Basic net (loss) income share                    $ 0.01         $  (0.03)            $ 0.06           $     0.00
                                             ===========   ==============       =============         ===========

Diluted (loss) income per share                  $ 0.01          $ (0.03)            $ 0.05           $     0.00
                                             ===========   ==============       =============         ===========

Weighted average shares outstanding
     Basic                                    5,170,771        4,171,823          4,526,082            4,061,402
                                             ===========   ==============       =============         ===========
     Diluted                                  5,751,160        4,705,156          5,130,310            4,594,735
                                             ===========   ==============       =============         ===========
</TABLE>


  The accompanying notes are an integral part of these consolidated condensed
                             financial statements.

                                       5
<PAGE>

                      GRILL CONCEPTS, INC. AND SUBSIDIARIES
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
<TABLE>

                                                                           Nine Months Ended
                                                                       --------------------------
                                                                      September 30,    September 24,
                                                                         2001              2000
                                                                       --------         ---------
<S>                                                                   <C>               <C>

Cash flows from operating activities:
     Net income                                                        $309,307          $ 32,652
     Adjustments to reconcile net income to net cash
     provided by operating activities:
         Depreciation and amortization                                  975,295           927,974
         Minority interest in net loss of subsidiaries                 (118,890)         (250,838)
         Equity in loss of joint venture                                  4,033             9,469
         Gain on sale of assets                                        (225,042)                -
     Changes in operating assets and liabilities
         Inventories                                                    (33,528)         (106,498)
         Receivables                                                    194,596           276,252
         Prepaid expenses                                              (364,026)          117,109
         Other assets                                                  (103,390)          (76,529)
         Accounts payable                                               (67,289)         (238,605)
         Accrued liabilities                                           (460,753)          134,860
                                                                      ----------        ---------
     Net cash provided by operating activities                          110,313           825,846
                                                                      ----------        ---------
Cash flows from investing activities:
     Additions to furniture, equipment and improvements              (1,088,488)       (2,196,076)
     Net proceeds from sale of assets                                   655,035                 -
                                                                      ----------       ----------
     Net cash used in investing activities                             (433,453)       (2,196,076)
                                                                      ----------       ----------
Cash flows from financing activities:
     Proceeds from equipment financing                                        -         1,003,535
     Proceeds from minority members' investment in LLCs               1,040,500         1,173,941
     Proceeds from issuance of note payable                                   -           400,000
     (Payments)/proceeds under line of credit                          (100,000)          100,000
     Proceeds from bank term loan                                             -         1,200,000
     Net proceeds from issuance of common stock                       1,862,403                 -
     Preferred return to minority stockholders                          (74,924)                -
     Return of capital to minority stockholders                        (161,789)                -
     Payments on related party debt                                    (104,922)         (387,910)
     Payments on long-term debt                                        (539,392)       (2,259,482)
                                                                     -----------       ----------
     Net cash provided by financing activities                        1,921,876         1,230,084
                                                                     -----------       ----------
Net (decrease) increase in cash and cash equivalents                  1,598,736          (140,146)
Cash and cash equivalents, beginning of period                          623,097           352,453
                                                                     -----------       ----------
Cash and cash equivalents, end of period                             $2,221,833         $ 212,307
                                                                     ===========       ==========

Supplemental cash flow information: Cash paid during the period for:
         Interest                                                     $ 317,123         $ 370,231
         Income taxes                                                    16,569                 -
</TABLE>


  The accompanying notes are an integral part of these consolidated condensed
                             financial statements.

                                       6
<PAGE>


                      GRILL CONCEPTS, INC. AND SUBSIDIARIES
              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (Unaudited)

1.       INTERIM FINANCIAL PRESENTATION

     The interim consolidated  financial statements are prepared pursuant to the
     requirements  for reporting on Form 10-Q.  These financial  statements have
     not been audited by independent accountants.  The December 31, 2000 balance
     sheet data was  derived  from  audited  financial  statements  but does not
     include  all  disclosures   required  by  generally   accepted   accounting
     principles.  The interim  financial  statements and notes thereto should be
     read in conjunction with the financial statements and notes included in the
     Company's  Form 10-K dated December 31, 2000. In the opinion of management,
     these interim  financial  statements  reflect all  adjustments  of a normal
     recurring  nature  necessary  for a fair  statement  of the results for the
     interim periods presented. The current period results of operations are not
     necessarily  indicative of results,  which  ultimately will be reported for
     the full year ending December 30, 2001.

     Certain  prior year  amounts have been  reclassified  to conform to current
     year presentation.

2.       MINORITY INTEREST - THE GRILL ON HOLLYWOOD

     In  connection  with the  building  of a new  restaurant,  in July 2001,  a
     limited liability company was formed for the operation of the "The Grill on
     Hollywood" restaurant in Hollywood,  California,  of which the Company owns
     51%.  Construction of the restaurant has been funded primarily by a capital
     contribution of $1,200,000 from the minority interest member of the limited
     liability  company of which $1,040,500 had been contributed as of September
     30, 2001. The Company is responsible  for  approximately  $250,000 of costs
     that will be incurred during the fourth quarter. The consolidated financial
     statements  include  the  accounts of the limited  liability  company  with
     minority interest reflected.

3.  FUTURE ACCOUNTING REQUIREMENTS

     In June 1998,  the FASB  issued SFAS No. 133,  "Accounting  for  Derivative
     Instruments  and Hedging  Activities".  This  Statement  requires  that all
     derivative  instruments  be  recorded  on the  balance  sheet at their fair
     value.  Changes  in the fair value of  derivatives  will be  recorded  each
     period in current  earnings or other  comprehensive  income,  depending  on
     whether a derivative is designated as part of a hedge  transaction  and, if
     it is,  the type of hedge  transaction.  The new rules were  effective  the
     first quarter of 2001.  The new standard did not have a material  impact on
     the Company's financial statements.

     In July 2001, the Financial  Accounting  Standards  Board  ("FASB")  issued
     Statement of Financial Accounting Standard No. 141 ("SFAS 141"),  "Business
     Combinations."  SFAS141  requires that the purchase method of accounting be
     used for all business  combinations  initiated  after June 30, 2001. Use of
     the  pooling-of-interest  method will be  prohibited.  The Company does not
     believe that the adoption of SFAS 141 will have a significant impact on its
     financial statements.

                                       7
<PAGE>

     In July 2001, the FASB also issued Statement of Financial Standards No. 142
     ("SFAS  142"),  "Goodwill  and  Other  Intangible  Assets."  SFAS 142 which
     changes the accounting for goodwill and indefinite-lived  intangible assets
     from  an  amortization  method  to an  impairment-only  approach,  will  be
     effective for fiscal years  beginning  after December 15, 2001. The company
     has not  determined  the impact that adoption of this Standard will have on
     its financial statements.

4.   PER SHARE DATA

     Basic earnings per share data is based upon the weighted  average number of
     common shares  outstanding.  Diluted  earnings per share data is based upon
     the weighted average number of common shares outstanding plus the number of
     common shares  potentially  issuable for dilutive  securities such as stock
     options and warrants.

5.   DISTRIBUTION OF CAPITAL AND PREFERRED RETURNS

     The  Operating   Agreement  for  San  Jose  Grill  LLC,   stipulates   that
     distributions of distributable cash shall be made first, 10% to the Manager
     and 90% to the Members in the ratio of their percentage interests until the
     Members have  received the amount of their  initial  capital  contribution.
     Second,  to the payment of the preferred return of ten percent per annum on
     the unpaid balance of the Member's adjusted capital  contribution until the
     entire accrued but unpaid  preferred  return has been paid.  Third,  to the
     Members in the ratio of their  percentage  interests  until the  additional
     capital  contributions  have been  repaid.  Thereafter,  to the Manager and
     Members  in the ratio of their  percentage  interests.  In  January  2001 a
     distribution of distributable cash in the amount of $89,910 was made to the
     minority member that reduced the member's interest.

     The Operating  Agreement and the Senior  Promissory  Note for Chicago - The
     Grill on the Alley, LLC stipulates that the non-manager member of Chicago -
     The Grill on the Alley, LLC is entitled to a cumulative preferred return of
     eight percent annually of their converted capital  contribution.  Preferred
     return  payments of $22,976  and  $74,924,  for the three and nine  months,
     respectively  were  paid to the  non-manager  member.  These  payments  are
     treated as a reduction of equity. Return of capital payments were also made
     to the  non-manager  member of $21,065 and $71,879,  for the three and nine
     months, respectively.

6.   RELATED PARTIES

     A note holder of the Company was elected to the Board of  Directors  at the
     Company's  annual meeting and became an investor of the Company at the same
     time.  The note  payable  was  reclassified  from  Long  Term Debt to Notes
     Payable - related parties. The reclassification  moved $95,850 from Current
     portion of long term debt to current  Notes  payable - related  parties and
     $201,903  from  Long  term  debt to  non-current  Notes  payable  - related
     parties.

                                       8
<PAGE>


7.   STOCKHOLDER'S EQUITY

     On July 27, 2001, the Company  completed a transaction with Starwood Hotels
     and Resorts Worldwide,  Inc. pursuant to which (1) the Company and Starwood
     entered into a Development  Agreement  under which the Company and Starwood
     agreed to jointly develop the Company's  restaurant  properties in Starwood
     hotels;  and (2) the Company sold 666,667 shares of restricted common stock
     and 666,667 stock  purchase  warrants at $2.00 to Starwood for  $1,000,000.
     Concurrently,  the Company sold an additional  666,666 shares of restricted
     common  stock  and  666,666  stock  purchase  warrants  at  $2.25  to other
     strategic  investors for  $1,000,000.  Proceeds  reflected in the financial
     statements are net of transaction costs.

     In conjunction with the Starwood transaction, on July 17, 2001, the Company
     sold the assets of its franchised  Pizzeria Uno restaurant located in South
     Plainfield, New Jersey for $700,000 less legal and other sale related costs
     of $44,965.

8.   INCOME TAXES

     The  provisions  for income  taxes are  minimal  because  the  Company  has
     available  federal  and  state  operating  loss  carryforwards  that may be
     utilized to offset federal and state taxable earnings.

                                       9
<PAGE>

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

The following  discussion and analysis  should be read in  conjunction  with the
Company's financial statements and notes thereto included elsewhere in this Form
10-Q. Except for the historical  information contained herein, the discussion in
this Form 10-Q contains  certain forward  looking  statements that involve risks
and  uncertainties,  such as  statements  of the  Company's  plans,  objectives,
expectations  and intentions.  The cautionary  statements made in this Form 10-Q
should be read as being  applicable to all related  forward  looking  statements
wherever  they appear in this Form 10-Q.  The  Company's  actual  results  could
differ materially from those discussed here. For a discussion of certain factors
that  could  cause  actual  results  to be  materially  different,  refer to the
Company's Annual Report on Form 10-K for the year ended December 31, 2000.

Results of Operations.

The following table sets forth, for the periods indicated,  information  derived
from  the  Company's  consolidated  statements  of  operations  expressed  as  a
percentage  of  total  operating   revenues,   except  where  otherwise   noted.
Percentages may not add due to rounding.
<TABLE>

                                          Three Months Ended           Nine Months Ended
                                        September     September      September     September
                                        30, 2001      24, 2000       30, 2001       24, 2000
                                       ----------    -----------    ----------     ----------
<S>                                    <C>           <C>            <C>            <C>

Revenues:
    Company restaurant sales              98.2 %        98.4 %       98.2 %         98.5%
    Management and license fees            1.8           1.6          1.8            1.5
                                         ------        -------      --------       -------
         Total operating revenues        100.0 %       100.0 %      100.0 %         100.0%

Cost of sales                             27.9          29.8         27.6           28.7
                                         ------        -------      -------        -------
     Gross profit                         72.1          70.2         72.4           71.3
                                         ------        -------      -------        -------

     Restaurant operating expense         61.2          59.1         60.5           58.5
     General and administrative expense    8.3           8.3          8.1            8.1
Depreciation and amortization              3.1           3.2          2.9            2.9
     Pre-opening costs                       -             -            -            1.4
                                         ------        -------      -------        -------
          Total operating expenses        72.6          70.6         71.5           70.9
                                         ------        -------      -------        -------
          Operating (loss) income         (0.5)         (0.4)         1.0            0.4

Interest expense, net                     (1.6)         (1.4)        (1.1)          (1.0)
Gain on disposal of assets                 2.2           0.0          0.7            0.0
                                         ------        -------      -------        -------
(Loss) income before provision for income
  taxes, minority interest and equity in loss
  of joint venture                         0.1          (1.8)         0.6           (0.6)
Provision for income taxes                 0.0           0.0          0.0            0.0
Minority interest                          0.5           0.8          0.3            0.7
Equity in loss of joint venture            0.0           0.0          0.0            0.0
                                         ------         ------      -------        -------
Net (loss) income                          0.6%         (1.0)%        0.9%           0.1%
                                         ======         ======      =======        =======
</TABLE>

                                       10
<PAGE>

The following table sets forth certain unaudited financial information and other
restaurant data relating to Company owned restaurants and Company managed and/or
licensed restaurants.
<TABLE>

                                    Third Quarter      Year-to-date       Total open at
                                      Openings           Openings         End of Quarter
                                 -----------------   -----------------   ----------------
                                 FY 2001   FY 2000   FY 2001   FY 2000   FY 2001  FY 2000
                                 -------   -------   -------   -------   -------  -------
<S>                              <C>       <C>       <C>       <C>       <C>       <C>

Daily Grill restaurants:
    Company owned                   -         -         -          -        10       10
    Managed and/or licensed         -         1         -          1         4        4
Grill on the Alley restaurants:
    Company owned                   -         -         -          1         3        3
Pizza restaurants                  (1)       (1)       (1)        (1)        1        2
Other restaurants
    Managed and/or licensed         -         -         -          -         1        1
                                ------     -----     ------     ------    ------   -----
Total                             (1)         -        (1)         1        19       20
                                ======     =====     ======     ======    ======   =====
</TABLE>
<TABLE>

                                                       Three Months Ended              Nine Months Ended
                                                   -------------------------        --------------------------
                                                    September     September        September      September
                                                    30,  2001     24, 2000          30, 2001         24, 2000
                                                   -----------   -----------       -----------    -------------
<S>                                                <C>           <C>               <C>            <C>

Weighted average weekly sales per company owned
restaurant:
    Daily Grill                                   $   55,821     $   54,765       $   60,901      $   58,205
    Grill on the Alley                                74,956         86,860           82,013          89,704
    Pizza restaurants                                 33,323         29,892           34,560          31,631

Change in comparable restaurant sales (1):
    Daily Grill                                          1.9 %          5.9 %            4.6 %           5.3 %
    Grill on the Alley                                  (4.7)%         17.0 %            0.5 %          13.3 %
    Pizza restaurants                                   (6.6)%         (4.5)%           (5.5)%          (4.2)%

Total revenues:
    Daily Grill                                  $ 6,531,017    $ 6,407,463      $21,376,316     $20,429,973
     Grill on the Alley                            2,923,292      3,387,527        9,595,578       7,765,646
    Pizza restaurants                                500,490        966,975        2,304,255       3,437,351
Management and license fees                          185,482        170,754          599,081         466,844
                                                 ------------    -----------      ----------     -----------

Total consolidated revenues                       10,140,281     10,932,719       33,875,230      32,099,814
                                                 ===========     ==========      ===========     ===========

Managed restaurants                                2,615,142      2,791,440        8,143,021       8,378,065
Licensed restaurants                               1,920,866      1,509,039        6,000,591       4,147,165
Less: management and license fees                   (185,482)      (170,754)        (599,081)      ( 466,844)
                                                 -----------     -----------     -----------     ------------
Total system sales                               $14,490,807  $  15,062,444      $47,419,761    $ 44,158,200
                                                 ===========     ==========      ===========     ============
</TABLE>

(1)  When computing comparable  restaurant sales,  restaurants open for at least
     12 months are compared from period to period.

                                       11
<PAGE>

Material  Changes in Results of  Operations  for the Three and Nine Months Ended
September 30, 2001 as compared to the Three and Nine Months Ended  September 24,
2000

The Company's  revenues for the third quarter of fiscal 2001  decreased to $10.1
million,  7.2% under the $10.9 million  generated for the same quarter of fiscal
2000.  Total  revenues  included $10.0 million of sales revenues and $185,000 of
management and licensing fees for the 2001 quarter  compared to $10.8 million of
sales  revenues  and  $171,000 of  management  and  licensing  fees for the 2000
quarter.  This $0.8 million, or 7.5%, decrease in sales revenues for the quarter
was primarily attributable to a decrease in sales for Chicago - The Grill on the
Alley  compared to the same period in fiscal 2000  ($373,000) and the closure of
Pizzeria  Uno in South  Plainfield,  New  Jersey  ($410,000).  Chicago  has been
experiencing  weakened sales which where  exaggerated by the drop in tourism and
conventions resulting from the tragedy of September 11th. Last year's sales were
strong after the June opening, which generated significant amounts of publicity.

Revenues for the nine months ended September 30, 2001 rose 5.5% to $33.9 million
from the $32.1  million  generated  for the same  period of fiscal  2000.  Total
revenues  included $ 33.3 million of sales  revenues and $599,000 of  management
and licensing fees for the first nine months of 2001,  compared to $31.6 million
of sales  revenues and $467,000 of management  and licensing  fees for the first
nine months of 2000.  The  increase in sales  revenues for the nine months ($1.6
million, or 5.2%) was primarily  attributable to an increase in same store sales
($954,000),  plus a full 39 weeks of sales  at the  Chicago  - The  Grill on the
Alley compared to only 15 weeks in 2000 ($1,802,000), which was partially offset
by the closure of the Pizzeria Uno  restaurants  in Media  ($630,000)  and South
Plainfield ($428,000).

Same store  sales (for  restaurants  open at least 12 months)  were flat for the
quarter and increased  3.2% for the nine months.  For the quarter,  increases in
average  check price were offset by a decrease in the number of guests.  For the
nine months,  the increase was due to average check price increases at the Daily
Grill   restaurants   ($1,085,000)  and  the  Grill  on  the  Alley  restaurants
($477,000).  This increase was  partially  offset by a decrease in the number of
guests at both the Daily  Grill and Grill on the Alley  restaurants  ($590,000).
Slightly more than half of the increase in average check price was  attributable
to menu price increases  implemented in the fourth quarter of 2000. The increase
in management and licensing fees for both the quarter ($15,000 or 8.6 %) and the
nine months ($132,000 or 28.3%) was primarily attributable to increased sales at
the Daily Gill  restaurant at Georgetown  Inn and the opening of the Daily Grill
in the Skokie DoubleTree in September 2000.

In  addition  to the  restaurants  owned  by the  Company,  of which  sales  are
consolidated  and included in the results of  operations  for the  Company,  the
Company also manages and licenses six other restaurants.  Total revenues for all
restaurants  owned,  managed and licensed by the Company were $14.5  million and
$15.1 million for the quarters, and $47.4 million and $44.2 million for the nine
months ended September 2001 and 2000,  respectively.  This represents a decrease
of $572,000,  or 3.8 %, for the quarter and an increase of $3.3 million,  or 7.4
%, for the nine months.

                                       12
<PAGE>

Cost of sales decreased by $435,000,  or 13.3%, for the quarter and increased by
$126,000,  or 1.4%, for the nine months ended  September 30, 2001 as compared to
the same periods in 2000.  The quarter  decrease was primarily due to a decrease
at Chicago - The Grill on the Alley  ($205,000)  and the closure of Pizzeria Uno
($127,000). The increase for the nine month period is primarily due to Chicago -
The Grill on the Alley ($502,000)  offset by closure of Pizzeria Uno ($315,000).
Cost of sales decreased as a percentage of revenues. Cost of sales was 27.9% for
the  quarter  and 27.6 % for the nine months as compared to 29.8 % for the third
quarter of 2000 and 28.7% for the  year-to-date  period in 2000. The decrease in
cost of sales as a  percentage  of  revenues  during  the 2001 nine  months  was
primarily the result of menu  refinements  and related sales mix as well as cost
reductions resulting from improved purchasing.

Restaurant  operating expenses  decreased by $254,000,  or 3.9%, for the quarter
and  increased as a percentage  of revenues from 59.1% in 2000 to 61.2% in 2001.
Restaurant  operating  expenses  increased by $1,712,000,  or 9.1%, for the nine
months as compared to the same periods in 2000 and  increased as a percentage of
revenues from 58.5% in 2000 to 60.5% in 2001.  The changes were primarily due to
Chicago  - The Grill on the  Alley  that had  decreased  operating  expenses  of
$259,000 for the quarter and increased  operating expenses of $1,119,000 for the
nine months.  The change in  restaurant  operating  expenses as a percentage  of
total revenues was primarily  attributable to payroll and related expenses which
were down $60,000, or 1.7%, for the quarter and up $1,318,000, or 12.4%, for the
nine months and variable  costs which were down $57,000,  or 4.7%, for the three
months and up  $221,000,  or 5.9%,  for the nine  months.  Payroll  and  related
benefits  decreased for the quarter at the Pizzeria Uno  restaurants  ($310,000)
and  were  partially  offset  by an  increase  at the  Daily  Grill  restaurants
($247,000).  For the nine months payroll and related  benefits  increased at the
Daily  Grill  restaurants  ($730,000)  and  Chicago  - The  Grill  on the  Alley
($733,000).  Variable  expenses  for  Chicago - The Grill on the Alley were down
$80,000 for the quarter and up $197,000  for the nine  months.  The  increase in
expenses at Chicago - The Grill on the Alley are due to the restaurant's  having
13 and 39 weeks of operations in the quarter and nine months of 2001 compared to
13 and 15 weeks for the quarter and nine months of 2000.

General and administrative expense decreased 7.4 % for the quarter and increased
6.0 % for the nine  months  as  compared  to the  same  periods  in  2000.  As a
percentage of total revenues,  general and administrative  expense totaled 8.3 %
for the quarters and 8.1% for the nine months in 2001 and 2000.  The increase in
total  general and  administrative  expense of $154,000,  or 6.0%,  for the nine
months  during 2001 was  primarily  attributable  to increased  headcount at the
corporate office and related benefits.

Depreciation  and  amortization  expense  decreased by 7.4 % for the quarter and
increased  by  5.1 % for  the  nine  months  compared  to  2000,  however,  as a
percentage  of  revenues,  it remained  flat as it was offset by the increase in
revenues.  The decrease in depreciation and amortization expense for the quarter
was  primarily  due to the closure of Pizzeria  Unos while the  increase for the
nine months was  primarily  due to the  Chicago - The Grill on the Alley  assets
being in service 39 weeks compared to 15 weeks in 2000.

All pre-opening costs incurred during the 2000 quarter and nine months relate to
the  opening of  Chicago-The  Grill on the Alley and were fully  funded  through
landlord contributions,  partnerships or a combination thereof and were expensed
as incurred.

                                       13
<PAGE>

Interest  expense,  net,  increased by $12,000,  or 7.9%, during the quarter and
$25,000,  or 7.4%,  during the nine months compared to the same periods in 2000.
The increase in interest  expense  related to preferred  returns  payable to San
Jose Grill  investors,  which  increased  by $23,000  for the 2001  year-to-date
period.  Interest expense  remained  relatively flat as a percentage of revenues
for both the quarter and nine months compared to prior year.

The Company  recorded  only minimal  income taxes for the nine months due to the
available  federal  and  state  net  operating  loss  carryforwards  that can be
utilized to offset federal and state taxable earnings.

The Company  reported a gain on  disposal  of assets in the amount of  $225,042,
arising from the sale of the assets of the Pizzeria Uno in South Plainfield, New
Jersey.  The  Company  sold the assets for  $700,000 in July 2001 less legal and
other sale related costs of $44,965.

Results for the quarter and nine  months  reflect  minority  interest in the net
losses of  subsidiaries  of $50,000 and  $119,000  respectively,  compared  with
$82,000 and $251,000 in the same periods in 2000. This decrease in the amount of
net losses  allocated to minority  interests  resulted  primarily from expensing
$458,000 of pre-opening costs,  attributable to Chicago - The Grill on the Alley
during the second quarter of 2000.

The Company  incurred a charge of $4,000 for its equity in loss of joint venture
during the nine months of 2001  compared to $9,000 in 2000,  which  reflects the
Company's 50% interest in the Daily Grill Short Order at Universal  Studios City
Walk.

The Company  reported  dividends  on  preferred  stock of $12,500 in each of the
quarters  and $37,500 in each of the nine months  ended  September  30, 2001 and
September 24, 2000.

Material Changes in Financial Condition, Liquidity and Capital Resources.

At September 30, 2001 the Company had negative  working  capital of $0.3 million
and a cash balance of $2.2 million  compared to negative working capital of $2.7
million and a cash balance of $0.6 million at December 31, 2000. The improvement
in working  capital was  primarily  attributable  to the receipt of $1.9 million
from  the  issuance  of  stock  and $0.7  million  from  the  sale of Uno  South
Plainfield less legal and other sale related expenses of $44,965.

The  Company's  need  for  capital  resources  has  resulted  from,  and for the
foreseeable  future is  expected to relate  primarily  to, the  construction  of
restaurants.  Historically,  the  Company has funded its  day-to-day  operations
through its operating  cash flow,  while funding growth through a combination of
bank borrowing,  loans from  stockholders/officers,  the sale of Debentures, the
sale of Preferred Stock, the issuance of warrants,  loans and tenant  allowances
from certain of its  landlords  and,  beginning in 1998,  through  joint venture
arrangements.  At September 30 2001,  the Company had existing bank borrowing of
$0.9 million, an SBA loan of $ 0.1 million, loans from  stockholders/officers of
$ 0.9  million,  equipment  loans of $ 1.2  million  and  loans/advances  from a
landlord and others of $ 0.1 million.

                                       14
<PAGE>

On November 9, 2001 the Company opened The Grill on Hollywood  restaurant in the
new Hollywood  and Highland  upscale  entertainment  and shopping  complex.  The
Company is responsible  for  approximately  $250,000 of costs at Hollywood to be
incurred  in the fourth  quarter of 2001.  The  Company  is  scheduled  to begin
management of a San Francisco  hotel-based  Daily Grill  restaurant in the first
quarter of 2002. The Company will be responsible for  approximately  $250,000 of
pre-opening  costs in San Francisco.  Management  anticipates that new non-hotel
based  restaurants will cost between $1 million and $2 million per restaurant to
build and open  depending  upon the location and  available  tenant  allowances.
Hotel based restaurants may involve remodeling existing facilities.  Substantial
capital  contributions from the hotel operators and other factors will cause the
cost to the Company of opening such  restaurants to be  substantially  less than
the Company's cost to build and open non-hotel based restaurants.

Management  believes  that  the  Company  has  adequate  resources  on hand  and
operating cash flow to sustain  operations for at least the following 12 months.
In order to fund the  opening of  additional  restaurants,  on July 27, 2001 the
Company raised $2.0 million of additional capital through the issuance of equity
securities to Starwood  Hotels and Resorts  Worldwide,  Inc. and other strategic
investors.  In conjunction with the Company's transaction with Starwood, in July
2001, the Company  entered into a development  arrangement  with Starwood Hotels
and Resorts Worldwide, Inc. to develop the Company's restaurants in Sheraton and
Westin hotel properties.

In July 2001,  the Company sold the assets of its South  Plainfield,  New Jersey
franchised  pizza restaurant for $700,000 less legal and other sale related fees
of $44,965.

Future Accounting Requirements

In June 1998, the Financial  Accounting Standards Board ("FASB') issued SFAS No.
133,  "Accounting  for  Derivative  Instruments  and Hedging  Activities."  This
Statement  requires that all  derivative  instruments be recorded on the balance
sheet at their fair  value.  Changes in the fair  value of  derivatives  will be
recorded  each  period  in  current  earnings  or  other  comprehensive  income,
depending on whether a derivative is  designated as part of a hedge  transaction
and, if it is, the type of hedge  transaction.  The new rules were effective the
first  quarter of 2001.  The new standard did not have a material  impact on the
Company's financial statements.

In July 2001, the FASB issued Statement of Financial Accounting Standard No. 141
("SFAS 141"), "Business Combinations." SFAS141 requires that the purchase method
of accounting  be used for all business  combinations  initiated  after June 30,
2001. Use of the pooling-of-interest method will be prohibited. The Company does
not believe that the adoption of SFAS 141 will have a significant  impact on its
financial statements.

In July 2001,  the FASB also issued  Statement  of Financial  Standards  No. 142
("SFAS 142"),  "Goodwill and Other  Intangible  Assets." SFAS 142, which changes
the  accounting  for goodwill  and  indefinite-lived  intangible  assets from an
amortization method to an impairment-only approach, will be effective for fiscal
years  beginning  after  December 15, 2001.  The company has not  determined the
impact that adoption of this Standard will have on its financial statements.

                                       15
<PAGE>

Certain Factors Affecting Future Operating Results

In addition to the  opening of the new  restaurant  during  2001,  as  described
above, and the various factors  described in the Company's Annual Report on Form
10-K for the year ended December 31, 2000, the following developments may impact
future operating results.

The  Company  is  actively  looking  for a buyer  for the  remaining  franchised
Pizzeria Uno restaurant in Cherry Hill, New Jersey.

Opening of The Grill on  Hollywood,  in  November  2001,  is  expected to have a
negative  short-term  impact on cash flow due to the required  expenditures  for
pre-opening costs. The San Francisco restaurant is expected to open in the first
quarter of 2002.  The Company will incur  approximately  $250,000 of pre-opening
costs during the first quarter of 2002.  Management  fees from the San Francisco
restaurant will begin  following the opening of the restaurant.  Discussions are
ongoing with Starwood Hotels and Resorts regarding any development locations.

The current  economic  downturn has had a negative  impact,  and may continue to
have a negative impact, on the Company's  revenues.  . There can be no assurance
that the Company will be  successful  in opening new  restaurants  in accordance
with its anticipated opening schedule; that sufficient capital resources will be
available to fund scheduled  restaurant  openings and start-up  costs;  that new
restaurants  can  be  operated  profitably;  that  hotel  restaurant  management
services will produce  satisfactory  cash flow and operating  results to support
such operations; that additional hotels will elect to retain the Company's hotel
restaurant management services;  that the remaining Pizza Restaurant can be sold
on terms satisfactory to the Company; or that proceeds, if any, from the sale of
the Pizza  Restaurants  can be  deployed  in a manner so as to replace  the cash
flows from the Pizza Restaurants.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

The Company is exposed to market risk from  changes in interest  rates on funded
debt. This exposure relates to its  non-revolving  credit and term loan facility
(the  "Credit  Facility").  Borrowings  outstanding  under the  Credit  Facility
totaled  $850,000 at September 30, 2001.  Borrowings  under the Credit  Facility
bear  interest at the lender's  reference  rate plus 0.25%.  A  hypothetical  1%
interest rate change would not have a material  impact on the Company's  results
of operations.

                                       16
<PAGE>


                           PART II - OTHER INFORMATION

Item 2.  Changes in Securities and Use of Proceeds

         On July 27, 2001,  the Company sold (1) 666,667  shares of common stock
and 666,667 five year common stock  purchase  warrants  exercisable at $2.00 per
share to Starwood  Hotels and Resorts  Worldwide,  Inc. for  $1,000,000  and (2)
666,666  shares of common  stock and  666,666  five year common  stock  purchase
warrants  exercisable  at $2.25 per share to 16 investors  for  $1,000,000.  The
securities were issued, without the use of an underwriter or placement agent and
without the payment of commissions,  pursuant to the exemption set forth in Rule
506 of the Securities  Act of 1933.  The  securities  were offered and sold to a
limited  number  of  purchasers,  all of whom  are  accredited  investors,  in a
privately  negotiated   transaction  without  general  solicitation  or  general
advertising.  All of the certificates  evidencing the securities sold are marked
with a legend indicating that the shares are "restricted stock" which may not be
resold except  pursuant to an effective  registration  statement or an exemption
from registration.

Item 6.  Exhibits and Reports on Form 8-K

(a)      Exhibits

         Exhibit No.           Description
         -----------           -----------
         None

(b)      Reports on Form 8-K

         None


                                       17
<PAGE>


                                   SIGNATURES

In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                                           GRILL CONCEPTS, INC.


Dated: November 13, 2001                  By:/s/ Robert Spivak
                                             ----------------------------------
                                           Robert Spivak, President
                                           and C.E.O



Dated: November 13, 2001                  By:/s/ Daryl Ansel
                                             ----------------------------------
                                           Daryl Ansel, Chief Financial Officer