<PAGE>   1
                       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 quarterly period ended: DECEMBER 31, 1996

             [ ] 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 0-28318

                             Multimedia Games, Inc.
      ------------------------------------------------------------------
       (Exact Name of Small Business Issuer as Specified in its Charter)

                 Texas                                     74-2611034
---------------------------------------------     ----------------------------
(State or Other Jurisdiction of Incorporation     (IRS Employer Identification
                                                           Number)


                       7335 South Lewis Avenue, Suite 302
                             Tulsa, Oklahoma 74136
                   ------------------------------------------
                    (Address of Principal Executive Offices)

                                 (918) 494-0576
                         -----------------------------
                          (Issuer's Telephone Number)


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



Check whether the issuer (1) 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       
                           ------         ------

As of January 27, 1996 there were 4,035,783 shares of the Company's Common
Stock, par value $.01, outstanding.

Transitional Small Business Disclosure Format (Check one)

                       Yes             No   X    
                           ------         ------



<PAGE>   2






                                  FORM 10-QSB

                                     INDEX






Part I.  Financial Information


   Item 1. Unaudited Consolidated Financial Statements


         Consolidated Balance Sheets
         (December 31, 1996 and September 30, 1996)

         Consolidated Statements of Operations
         (Three months ended December  31, 1996 and 1995)

         Consolidated Statements of Cash Flows
         (Three months ended December 31, 1996 and 1995)

         Notes to Unaudited Consolidated Financial Statements

         Report of Review by Independent Accountants

   Item 2.  Management's Discussion and Analysis


Part II Other Information


   Item 2. Changes in Securities

   Item 6. Exhibits and Reports on Form 8-K

Signatures


<PAGE>   3





                     MULTIMEDIA GAMES,INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                 As of December 31, 1996 and September 30, 1996
                                (Unaudited) 


<TABLE>
<CAPTION>
                                                                  December       September
                         ASSETS                                     1996           1996
                                                                 -----------    -----------
<S>                                                              <C>            <C>        
Current Assets:
   Cash and cash equivalents                                     $ 2,782,000    $ 1,508,000
   Accounts Receivable:
      Trade, net of allowance for doubtful accounts of $76,000       354,000        247,000
      Other                                                           77,000         45,000
   Inventory, at cost                                                203,000        358,000
   Prepaid expenses                                                   96,000         92,000
                                                                 -----------    -----------
   Total current assets                                            3,512,000      2,250,000
                                                                 -----------    -----------

Restricted cash and cash equivalents                               1,536,000      1,534,000
Note receivable from American Gaming Network LLC                     336,000        336,000
Property and equipment, net                                        3,279,000      2,616,000
Other assets                                                         125,000        196,000
Goodwill, net                                                        493,000        499,000
                                                                 -----------    -----------

Total assets                                                     $ 9,281,000    $ 7,431,000
                                                                 ===========    ===========

                   LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
   Notes payable                                                 $    50,000    $    50,000
   Current portion of long-term debt                                 262,000        197,000
   Due to American Gaming Network LLC                                 93,000         99,000
   Accounts payable and accrued expenses                           1,379,000      1,292,000
   Halls' share of surplus                                           140,000        120,000
   Prize fulfillment fees payable                                    212,000        320,000
                                                                 -----------    -----------
   Total current liabilities                                       2,136,000      2,078,000
                                                                 -----------    -----------

Bridge notes payable                                                    --          800,000
Long-term debt                                                       779,000        787,000
Other long-term liabilities                                        1,372,000      1,372,000
Commitments and Contingencies  (Note 3)
Stockholders' equity:
   Preferred stock, Series A, $.01 par value, 2,000,000 shares
    authorized, 134,318 shares issued and outstanding                  1,000          1,000
   Common stock, $.01 par value, 10,000,000 shares authorized,
    4,026,783 and 2,859,200 shares issued and 3,992,784 and
    2,825,201 shares outstanding                                      40,000         29,000
   Additional paid-in capital                                      9,112,000      6,296,000
   Stockholder notes receivable                                   (1,271,000)    (1,271,000)
   Treasury stock, 33,999 shares at cost                             (87,000)       (87,000)
   Accumulated deficit                                            (2,801,000)    (2,574,000)
                                                                 -----------    -----------
   Total stockholders' equity                                      4,994,000      2,394,000
                                                                 -----------    -----------

Total liabilities and stockholders' equity                       $ 9,281,000    $ 7,431,000
                                                                 ===========    ===========
</TABLE>



See notes to unaudited consolidated financial statements 
<PAGE>   4

                    MULTIMEDIA GAMES, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
             For the three months ended December 31, 1996 and 1995
                                  (Unaudited)


<TABLE>
<CAPTION>
                                                       Three Months Ended
                                                          December 31
                                                      1996           1995
                                                   -----------    -----------
<S>                                                <C>            <C>        
Revenues:
   Gaming revenue                                  $ 6,804,000    $ 4,025,000
   Sale of Intellectual Property                          --          500,000
   Other                                                 1,000        133,000
                                                   -----------    -----------
        Total Revenue                                6,805,000      4,658,000
                                                   -----------    -----------

Operating costs and expenses:
   Bingo prizes and commissions                      2,216,000      2,427,000
   Allotments to hall operators                      3,034,000        806,000
   Salaries and wages                                  477,000        321,000
   Selling, general and administrative expenses       920,000        940,000
   Amortization and depreciation                       289,000         90,000
                                                   -----------    -----------
       Total operating costs and expenses            6,936,000      4,584,000
                                                   -----------    -----------

Operating Income (Loss)                               (131,000)        74,000

   Interest income                                       6,000         16,000
   Interest expense                                     65,000         22,000
                                                   -----------    -----------

Net Income (Loss)                                  $  (190,000)   $    68,000
                                                   ===========    ===========

Income (Loss) per common and equivalent share,
   primary and fully diluted                       $     (0.07)   $      0.02
                                                   ===========    ===========


Weighted average shares outstanding                  3,226,000      2,008,000
                                                   ===========    ===========
</TABLE>





See notes to unaudited consolidated financial statements.










<PAGE>   5





                     MULTIMEDIA GAMES,INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
             For the three months ended December 31, 1996 and 1995
                                  (Unaudited)


<TABLE>
<CAPTION>
                                                               Three Months Ended
                                                                  December 31
                                                              1996           1995
                                                           -----------    -----------
<S>                                                        <C>            <C>        
Cash flows from operating activities:
   Net income (loss)                                       $  (190,000)   $    68,000
   Adjustments to reconcile net income (loss) to cash
       provided by (used for) operating activities:
      Amortization and depreciation                            289,000         90,000
      Other non-cash (revenue) expenses                         71,000        (10,000)
      (Increase) decrease in:
         Accounts and notes receivable                        (139,000)        56,000
         Inventory                                             155,000           --
         Prepaid expenses                                       (4,000)       (53,000)
      Increase (decrease) in:
         Accounts payable and accrued expenses                  81,000         24,000
         Halls' share of surplus                                20,000        133,000
         Prize fulfillment fees payable                       (108,000)       (47,000)
                                                           -----------    -----------
   Net cash provided by (used for) operating activities        175,000        261,000
                                                           -----------    -----------
Cash flows from investing activities:
   Acquisition of property and equipment                      (946,000)      (678,000)
   Increase in cash balances in restricted escrow               (2,000)      (116,000)
                                                           -----------    -----------
   Net cash provided by (used for) investing activities       (948,000)      (794,000)
                                                           -----------    -----------
Cash flows from financing activities:
   Proceeds from sale of common stock                        2,027,000         20,000
   Increase in deferred prize liability                           --          114,000
   Increase in long-term debt                                  120,000           --
   Principal repayments of debt                                (63,000)       (49,000)
   Payment of preferred stock dividends                        (37,000)       (37,000)
   Purchase of treasury stock                                     --          (14,000)
                                                           -----------    -----------
   Net cash provided by (used for ) financing activities     2,047,000         34,000
                                                           -----------    -----------

Net change in cash and cash equivalents                      1,274,000       (499,000)

Cash and cash equivalents, beginning of period               1,508,000      1,537,000

                                                           -----------    -----------
Cash and cash equivalents, end of period                   $ 2,782,000    $ 1,038,000
                                                           ===========    ===========
</TABLE>


See notes to unaudited consolidated financial statements.













<PAGE>   6





                    MULTIMEDIA GAMES, INC. AND SUBSIDIARIES
                        NOTES TO UNAUDITED CONSOLIDATED
                              FINANCIAL STATEMENTS

1.       SIGNIFICANT ACCOUNTING POLICIES

         The accompanying financial statements should be read in conjunction
         with the Company's financial statements for the twelve months ended
         September 30, 1996 contained within the Company's Annual Report on
         Form 10-KSB.

                   The financial statements included herein as of December 31,
         1996 and for each of the three month periods ended December 31, 1996
         and 1995, have been prepared by the Company, without an audit,
         pursuant to generally accepted accounting principles and the rules and
         regulations of the Securities and Exchange Commission. The information
         presented reflects all adjustments (consisting solely of normal
         recurring adjustments) which are, in the opinion of management,
         necessary for a fair statement of results for the period. Results for
         the three months ended December 31, 1996, are not necessarily
         indicative of the results which will be realized for the year ending
         September 30, 1997. The September 30, 1996 consolidated balance sheet
         data was derived from audited financial statements, but does not
         include all disclosures required by generally accepted accounting
         principles. Certain prior period information has been reclassified to
         conform to current period presentation.

         INCOME (LOSS) PER COMMON SHARE - Income (loss) per common share is
         computed on the basis of the weighted average shares of common stock
         outstanding for the three months ended December 31, 1996 and 1995.
         Options and warrants are common stock equivalents and, along with
         contingent stock issuances, are considered in the computation of
         income per common share using the treasury stock method when they are
         dilutive. To determine income per common share, net income is adjusted
         for preferred stock dividends which were $37,000 for each of the three
         months ended December 31, 1996 and 1995. Weighted average shares
         outstanding were 3,226,000 and 2,008,000 on a primary and fully
         diluted basis, for the three months ended December 31, 1996 and 1995,
         respectively.

2.       FINANCING ACTIVITIES

                  In November 1996, the Company completed a private placement
         of approximately 1.2 million shares of common stock for $3.00 per
         share. Each of the 1.2 million shares sold was accompanied by a
         redeemable warrant to purchase an additional share of the Company's
         common stock for $8 (a"Redeemable Warrant"). After nine months, each
         Redeemable Warrant may be called by the Company for $.10 when the
         closing bid price of the Company's common stock has been at least
         $12.00 for 20 consecutive trading days. Redeemable Warrants totaling
         350,000 were granted to the placement agent in connection with the
         November Placement. Proceeds from the November Placement (which
         included the conversion of the Bridge Debt discussed below) are
         intended to finance the expansion of the Company's MegaMania network.



<PAGE>   7





                    MULTIMEDIA GAMES, INC. AND SUBSIDIARIES
                        NOTES TO UNAUDITED CONSOLIDATED
                              FINANCIAL STATEMENTS

                  The November Placement was preceded by a private placement of
         bridge debt financing in the amount of $800,000 (the "Bridge Debt")
         which was completed in early August 1996. Redeemable Warrants
         representing 360,000 shares accompanied the Bridge Debt and an
         additional 173,310 Redeemable Warrants were granted to the placement
         agent. The Bridge Debt was converted into common stock and Redeemable
         Warrants in connection with the completion of the November Placement.

3.       COMMITMENTS AND CONTINGENCIES

         Pending Investigation

                  On October 16, 1996, the Company was advised by the Office of
         the U.S. Attorney in Tulsa, Oklahoma (the "U.S. Attorney") that the
         Company was part of a criminal investigation to determine whether, in
         the opinion of the U.S. Attorney, the Company's MegaMania bingo game
         constituted Class II or Class III gaming, as defined by the Indian
         Gaming Regulatory Act of 1988 (the "Gaming Act"). MegaMania has been
         designed and is operated as a Class II game within the definition of
         bingo set forth in the Gaming Act. In a written opinion dated July 10,
         1996, the Company was informed by the National Indian Gaming
         Commission ("NIGC"), of the NIGC's determination that MegaMania
         constituted a Class II game.

                  The Company has relied on the NIGC's opinion in conducting
         its operations and believes that the NIGC made its determination with
         a complete and accurate understanding of the facts and the applicable
         law. The Company is unaware of any circumstances that would have
         caused the investigation by the U.S. Attorney or on what basis the
         U.S. Attorney could conclude that MegaMania is not a Class II game.

                  No assurances can be given that the U.S. Attorney will not
         conclude that MegaMania is Class III gaming. If the U.S. Attorney does
         reach such a conclusion, the Company intends to vigorously defend its
         position that MegaMania is a Class II game. No assurances can be given
         that the Company will be successful on the merits. If MegaMania is
         ultimately determined to be Class III gaming, the loss of the
         MegaMania business would have a material adverse effect upon the
         Company's financial condition and results of operation.

         Litigation

                  The Company is a party to various lawsuits and claims arising
         out of the ordinary course of its business. No accrual for potential
         loss has been made in the accompanying financial statements as
         management does not believe that the likelihood of a material loss is
         probable at this time.





<PAGE>   8


                        INDEPENDENT ACCOUNTANT'S REPORT






         To the Board of Directors and Stockholders
         Multimedia Games, Inc.

                  We have reviewed the accompanying consolidated balance sheet
         of Multimedia Games, Inc. and Subsidiaries as of December 31, 1996,
         and the related consolidated statements of operations and cash flows
         for the three-month period ended December 31, 1996. These financial
         statements are the responsibility of the Company's management.

                  We conducted our review in accordance with standards
         established by the American Institute of Certified Public Accountants.
         A review of interim financial information consists principally of
         applying analytical procedures to financial data and making inquiries
         of persons responsible for financial and accounting matters. It is
         substantially less in scope than an audit conducted in accordance
         with generally accepted auditing standards, the objective of which is
         the expression of an opinion regarding the financial statements taken
         as a whole. Accordingly, we do not express such an opinion.

                  Based on our review, we are not aware of any material
         modifications that should be made to the accompanying financial
         statements for them to be in conformity with generally accepted
         accounting principles.

                  We have previously audited, in accordance with generally
         accepted auditing standards, the consolidated balance sheet as of
         September 30, 1996, and the related consolidated statements of
         operations, stockholders' equity and cash flows for the year then ended
         (not presented herein); and in our report dated December 18, 1996, we
         expressed an unqualified opinion on those consolidated financial
         statements. In our opinion, the information set forth in the
         accompanying consolidated balance sheet as of September 30, 1996 is
         fairly stated in all material respects in relation to the consolidated
         balance sheet from which it has been derived.




         COOPERS & LYBRAND L.L.P.


         Tulsa, Oklahoma
         February 7, 1997










<PAGE>   9






ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS


GENERAL

                  Multimedia Games, Inc. and subsidiaries (the "Company") were
         organized to develop, promote and produce lawful gaming activities
         over the information highway, including but not limited to satellites,
         television, telephone and the Internet. The Company provides satellite
         linked, high stakes bingo games and interactive high speed bingo games
         played on interconnected electronic player stations to participating
         bingo halls owned primarily by American Indian tribes located
         throughout the United States. The Company also provides proxy play
         services for its MegaBingo and MegaCash games to bingo players located
         off Indian lands through a subsidiary's 49% interest in American
         Gaming Network L.L.C. ("AGN").

                  Prior to August 1995, the Company's principal business was to
         furnish the marketing and other operating services required in the
         conduct of high stakes bingo games conducted under the names
         MegaBingo, MegaCash and MegaBingo Lite (the "MegaBingo Games").
         MegaBingo and MegaCash are played simultaneously using a
         closed-circuit television satellite link at 50 independently owned
         bingo halls located in 14 states throughout the United States,
         operated primarily on behalf of American Indian tribes. MegaBingo Lite
         provides smaller prizes to similarly linked Indian bingo halls and is
         presently delivered to 11 bingo halls located in the State of
         Oklahoma.

                  In August 1995, the Company introduced MegaMania, an
         interactive high-speed bingo game developed by the Company that is
         played on electronic player stations interconnected among
         participating Indian bingo halls. Significant revenue generation for
         MegaMania did not begin until March 1996. As of December 31, 1996,
         MegaMania is played at 25 independently owned American Indian bingo
         halls located in 6 different states, primarily Oklahoma.

RESULTS OF OPERATIONS

                  The Company's total operating revenues were $6,805,000 and
         $4,658,000 for the three months ending December 31, 1996 and 1995
         respectively, or an increase of $2,147,000 for the 1996 period. The
         increase was primarily a result of an increase in gaming revenue of
         $2,779,000, partially offset by a decrease in the sale of intellectual
         property of $500,000 that occurred in the 1995 period. The increase in
         gaming revenue was driven by increased MegaMania gaming revenues
         during the three months ended December 31, 1996, which were partially
         offset by MegaBingo revenue decreases.
<PAGE>   10

                  Bingo prizes and related fees were $2,216,000 and $2,427,000
         for the three months ended December 31, 1996 and 1995 respectively, or
         a decrease of $211,000. The decrease resulted from decreased MegaBingo
         revenue during the period.

                  Allotments to hall operators was $3,034,000 and $806,000 for
         the three months ended December 31, 1996 and 1995 respectively. The
         increase resulted from the increase in MegaMania revenues.

                  Salaries and wages were $477,000 and $321,000 for the three
         months ended December 31, 1996 and 1995 respectively, or an increase
         of $156,000. Salaries and wages increased during the three months
         ended December 31, 1996 due to additional staff needed for the
         increased MegaMania operations.

                  Selling, general and administrative expenses were $920,000
         and $940,000 for the three months ending December 31, 1996 and 1995,
         respectively, or a decrease of $20,000. The decrease is primarily due
         to a decrease in business meals and travel of approximately $100,000
         during the three months ended December 31, 1996, partially offset by
         additional telephone expense during the period due to the increase in
         MegaMania operations and an increase in legal and professional fees 
         primarily as a result of increased legal and regulatory activity.

                  Amortization and depreciation was $289,000 and $90,000 for
         the three months ending December 31, 1996 and 1995 respectively, or an
         increase of $199,000. The increase results from the acquisition of
         MegaMania electronic player stations and computer software costs 
         capitalized during 1996.


LIQUIDITY AND CAPITAL RESOURCES

                  At December 31, 1996, the Company had $2,782,000 in cash and
         cash equivalents. Cash and cash equivalents increased during the
         quarter ended December 31, 1996 by $1,274,000 primarily as a result of
         $2,027,000 in net cash proceeds from a private offering of capital
         stock and a decrease in inventory of $155,000, partially offset by the
         purchase of equipment totaling $946,000.  As a result, at December 31,
         1996, the Company had positive working capital of $1,376,000.

                  The Company believes that its current operations can be
         sustained from cash from operations. However, in expanding its
         MegaMania operations with the purchase and installation of additional
         electronic player stations, funding is expected to be obtained from
         financial institutions.

<PAGE>   11


FUTURE EXPECTATIONS AND FORWARD LOOKING STATEMENTS

                  This Quarterly Report and the information incorporated herein
         by reference contains various "forward-looking statements" within the
         meaning of Federal and state securities laws, including statements
         identified or predicated by the words "believes," "anticipates,"
         "expects," "plans," or similar expressions. Such statements are
         subject to a number of uncertainties that could cause the actual
         results to differ materially from those projected. Such factors
         include, but are not limited to, those described under "Item 1.
         Description of Business - Risk Factors" contained in the Company's
         Annual Report on Form 10-KSB for the fiscal year ended September 30,
         1996, which are incorporated herein by this reference. Given these
         uncertainties, readers of this Quarterly Report are cautioned not to
         place undue reliance upon such statements.



<PAGE>   12




                                    PART II

                               OTHER INFORMATION


ITEM 2.   CHANGES IN SECURITIES

                  In November 1996, the Company completed a private placement
         (the "November Placement") of 1,158,833 shares of the Company's Common
         Stock at a purchase price of $3.00 per share. Net proceeds to the
         Company, which excludes the conversion of $800,000 of previously
         incurred Bridge Debt,was $2,027,000. Each share of Common Stock sold
         was accompanied by a redeemable warrant to purchase an additional
         share of the Company's Common Stock for $8 per share (a "Redeemable
         Warrant"). After nine months, each Redeemable Warrant may be redeemed
         by the Company for $.10 when the closing bid price of the Company's
         Common Stock has been at least $12.00 for 20 consecutive trading days.
         The Redeemable Warrants expire after November 12, 2001, if not
         exercised prior to that date. Redeemable Warrants totaling 350,000
         were also granted to Walsh, Manning Securities, LLC, which acted as
         the placement agent for the Company in connection with the November
         Placement. In addition to such Redeemable Warrants, Walsh, Manning
         Securities, LLC, received a commission of 10% and a nonaccountable
         expense allowance of 3% of the total proceeds to the Company. The
         November Placement was consummated without registration under the
         Securities Act of 1933, as amended (the "1933 Act"), in reliance upon
         the exemption from registration pursuant to Section 4 (2) of the 1933
         Act and Rule 501 of Regulation D promulgated thereunder. All of the
         purchasers in the November Placement are believed by the Company to be
         "accredited investors" within the meaning of the 1933 Act.


ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

          (a)      The exhibits filed as part of this Quarterly Report on Form
          10-QSB are listed in the attached Index to Exhibits.


          (b)      There were no reports filed on Form 8-K during the current 
          quarter.


                                   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.




          Dated February 13, 1997       Multimedia Games, Inc.



                                         By:  /s/ FREDERICK E. ROLL
                                            ----------------------------------
                                         Frederick E. Roll, Vice President and
                                         Chief Financial Officer





<PAGE>   13
                              INDEX TO EXHIBITS



<TABLE>
<CAPTION>
EXHIBIT
NUMBER                   DESCRIPTION
-------                  -----------
<S>           <C>
  10.1        -  *Contingent Grand Prize Risk Assumption Agreement dated
                 October 1, 1995, between the Company and SCA Promotions, Inc.

  10.2        -  *Lease Agreement dated October 10, 1996, between the Company
                 and Intervest-Southern Oaks LP

  10.3        -  *Form of Private Placement Warrant

  10.4        -  *Registration Rights Agreement among the Company and holders
                 of Bridge Warrants and Private Placement Warrants

  15          -  Letter Regarding Unaudited Interim Financial Information

  27          -  Financial Data Schedule

</TABLE>

* Indicates incorporated by reference to the Company's Form 10-KSB filed with
  the Commission for the fiscal year ended September 30, 1996.