<PAGE>



                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   FORM 10-QSB

[X]     Quarterly  Report pursuant to Section 13 or 15(d) of the Securities
        Exchange  Act  of  1934

        For  the  quarterly  period  ended  March  31,  2003

[ ]     Transition  Report  pursuant to 13 or 15(d) of the Securities Exchange
        Act  of  1934

        For  the  transition  period      to


          Commission  File  Number     000-21391
                                       ---------

                           TURBODYNE TECHNOLOGIES INC.
          ----------------------------------------------------------------
          (Exact name of small Business Issuer as specified in its charter)

NEVADA                                        95-4699061
------------------------------------          --------------
(State  or  other  jurisdiction  of           (IRS  Employer
incorporation  or  organization)              Identification  No.)



6155  Carpinteria  Avenue,
Carpinteria,  California                       93013
-------------------------                      -----
(Address  of  principal  executive  offices)   (Zip  Code)


Issuer's  telephone  number,
 including  area code:                         (805) 684-4551
                                               --------------


                                 NOT APPLICABLE
            --------------------------------------------------------
            (Former name, former address and former fiscal year end,
                          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  Securities  Exchange Act of 1934 during the preceding 12
months  (or  for  such  shorter period that the issuer was required to file such
reports),  and  (2) has been subject to such filing requirements for the past 90
days  [X]  Yes    [  ]  No

State the number of shares outstanding of each of the issuer's classes of common
stock,  as  of  the latest practicable date:  133,298,187 shares of common stock
issued  and  outstanding  as  of  May  14,  2003.




<PAGE>


                         PART 1 - FINANCIAL INFORMATION

Item  1.          Financial  Statements



<PAGE>




                         PART 1 - FINANCIAL INFORMATION

Item  1.  Financial  Statements

                    Turbodyne  Technologies,  Inc.  and  Subsidiaries
                    Consolidated  Financial  Statements
                    For the three-month periods ended March 31, 2003 and 2002
                    (Unaudited  -  Expressed  in  US  Dollars)



<PAGE>


                    Turbodyne  Technologies,  Inc.  and  Subsidiaries
                    Consolidated  Financial  Statements
                    For the three-month periods ended March 31, 2003 and 2002
                    (Unaudited  -  Expressed  in  US  Dollars)


                               Contents

================================================================================

Consolidated  Financial  Statements


     Balance  Sheets

     Statements  of  Operations

     Statements  of  Capital  Deficit

     Statements  of  Cash  Flows

     Notes  to  the  Financial  Statements



<PAGE>
<TABLE>
<CAPTION>

                                                   Turbodyne Technologies, Inc. and Subsidiaries
                                                                     Consolidated Balance Sheets
                                                                       (Expressed in US Dollars)

                                                      March 31              December 31
                                                        2003                   2002
----------------------------------------------------------------------------------------
Assets                                               (Unaudited)
<S>                                           <C>                        <C>
Current
  Cash                                        $                 12,413   $     137,517
  Prepaid expenses and other current assets                     13,294          14,194
                                               -----------------------------------------

  Total current assets                                          25,707         151,711
Property and equipment, at cost,
 less accumulated depreciation                                 154,404         168,918
Licenses, at cost less accumulated
 amortization                                                  780,000         832,000
                                               -----------------------------------------

Total Assets                                  $                960,111   $   1,152,629
Liabilities and Capital Deficit
========================================================================================
Liabilities
Current
  Term debts                                  $                 80,571   $      73,071
  Accounts payable                                           3,498,022       3,442,541
  Accrued liabilities                                        3,884,119       5,061,515
  Provisions for lawsuit settlements                         4,059,909       4,309,909
  Loans payable (Note 3)                                       126,283         169,055
                                               -----------------------------------------

  Total liabilities                                         11,648,904      13,056,091
                                               -----------------------------------------
Capital Deficit
  Share Capital (Note 2)
    Authorized
          1,000,000 preferred shares,
       par value $0.001
      150,000,000 common shares,
      par value $0.001
    Issued
      122,175 preferred shares in
      2003 (2002 - Nil)                                            122               -
      129,586,320 common shares in
      2003 (2002 -115,620,517)                                 129,586         115,621
  Treasury stock, at cost
  (378,580 shares)                                          (1,907,612)     (1,907,612)
  Additional paid-in capital                               115,929,793     113,445,516
  Accumulated other comprehensive
  income -
    Foreign exchange translation
    gain                                                        35,119          35,119
  Accumulated deficit                                     (124,875,801)   (123,592,106)
                                               -----------------------------------------

  Total capital deficit                                    (10,688,793)    (11,903,462)
                                               -----------------------------------------
Commitments and contingencies (Note 4)
Total Liabilities and Capital Deficit         $                960,111   $   1,152,629
========================================================================================

</TABLE>




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

<PAGE>
<TABLE>
<CAPTION>

                                   Turbodyne Technologies, Inc. and Subsidiaries
                                           Consolidated Statements of Operations
                                           (Unaudited - Expressed in US Dollars)


For the three-month periods ended March 31     2003          2002
--------------------------------------------------------------------
<S>                                     <C>            <C>
Expenses
  Selling, general and administrative   $    361,225   $   267,675
  Research and developments                1,001,214       954,853
  Litigation (recovery) expense             (144,791)      270,901
  Depreciation and amortization               66,514        66,075
                                        ---------------------------
    Total expenses                         1,284,162     1,559,504
                                        ---------------------------

Loss from operations                      (1,284,162)   (1,559,504)

Other income (expense)
  Interest expense, net                            -          (126)
  Other, net                                     467         2,896
                                        ---------------------------

Net loss for the period                 $ (1,283,695)  $(1,556,734)
===================================================================
Loss per common share

  Basic and diluted                     $      (0.01)  $     (0.02)
===================================================================
Weighted average shares outstanding      122,144,631    84,397,619
===================================================================
</TABLE>



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

<PAGE>
<TABLE>
<CAPTION>

Turbodyne  Technologies,  Inc.  and  Subsidiaries
                                    Consolidated Statements of Capital Deficit
                                   (Unaudited - Expressed in US Dollars)

                               Preferred Stock   Common Stock    Treasury Stock            Additional
                               ----------------------------------------------------------   Paid-in
                               Shares   Amount   Shares       Amount    Shares   Amount     Capital
                               ---------------------------------------------------------------------------
<S>                            <C>      <C>   <C>           <C>       <C>      <C>           <C>
Balance, January 1, 2002            -  $  -   84,036,915    $84,037   378,580  $(1,755,534)  $108,147,994
Exercise of stock options           -     -    5,377,143      5,377         -            -        550,337
Private placements of common stock  -     -   21,832,459     21,833         -            -      2,572,318
Issuance of stock for services      -     -    4,374,000      4,374         -            -      1,061,156
Issuance of stock options to non-
employees for services              -     -            -          -         -            -      1,470,930
Inception of Turbodyne Technologies Inc.
(Nevada Company) on August 15, 2002 -     -            1          1         -            -              -
Adjustment for reverse acquisition of
Turbodyne Technologies, Inc. (Nevada
Company) on September 12, 2002      -     -           (1)        (1)        -            -              -
Obligation to acquire Company
 shares                             -     -            -          -         -     (152,078)             -
Liability for settlement
  of equity instruments             -     -            -          -         -            -       (357,219)
                               ---------------------------------------------------------------------------

Net loss for the year               -     -            -          -         -            -              -

Balance, December 31, 2002          -     -  115,620,517    115,621   378,580   (1,907,612)   113,445,516

Issuance of Preferred Series
  X Shares                    122,175   122            -          -         -            -      1,613,378
Exercise of stock options           -     -    3,249,000      3,249         -            -        241,671
Private placement of common
 stock                              -     -    8,533,391      8,533         -            -        500,471
Issuance of stock for service       -     -    2,183,412      2,183         -            -        311,707
Issuance of stock options to non-
employees for services              -     -            -          -         -            -        746,692
Liability in connection with settlement of
equity instruments (Note 2)         -     -            -          -         -            -       (929,642)
Net loss for the period             -     -            -          -         -            -              -
                               ---------------------------------------------------------------------------

Balance, March 31, 2003       122,175  $122  129,586,320   $129,586   378,580  $(1,907,612)  $115,929,793
===========================================================================================================



                                                        Other
                                                Comprehensive  Accumulated  Capital
                                                       Income      Deficit  Deficit
---------------------------------------------------------------------------------------
<S>                                              <C>      <C>             <C>
Balance, January 1, 2002                         $35,119  $(114,589,361)  $ (8,077,745)
Exercise of stock options                              -              -        555,714
Private placements of common stock                     -              -      2,594,151
Issuance of stock for services                         -              -      1,065,530
Issuance of stock options to non-
employees for services                                 -              -      1,470,930
Inception of Turbodyne Technologies Inc.
(Nevada Company) on August 15, 2002                    -              -              1
Adjustment for reverse acquisition of
Turbodyne Technologies, Inc. (Nevada
Company) on September 12, 2002                         -              -             (1)
Obligation to acquire Company shares                   -              -       (152,078)
Liability for settlement of equity instruments         -              -       (357,219)
Net loss for the year                                  -     (9,002,745)    (9,002,745)
                               --------------------------------------------------------

Balance, December 31, 2002                        35,119   (123,592,106)   (11,903,462)
Issuance of Preferred Series X Shares                  -              -      1,613,500
Exercise of stock options                              -              -        244,920
Private placement of common stock                      -              -        509,004
Issuance of stock for service                          -              -        313,890
Issuance of stock options to non-
employees for services                                 -              -        746,692
Liability in connection with settlement of
equity instruments (Note 2)                            -              -       (929,642)
Net loss for the period                                -     (1,283,695)    (1,283,695)
                               --------------------------------------------------------
Balance, March 31, 2003                          $35,119  $(124,875,801)  $(10,688,793)
=======================================================================================
</TABLE>





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

<PAGE>
<TABLE>
<CAPTION>

                                    Turbodyne Technologies, Inc. and Subsidiaries
                                            Consolidated Statements of Cash Flows
                                            (Unaudited - Expressed in US Dollars)

For the three-month periods ended March 31                   2003          2002
                                                      ----------------------------
Cash provided by (used in)
<S>                                                    <C>           <C>
Operating activities
  Net loss for the period                              $(1,283,695)  $(1,556,734)
  Adjustments to reconcile net loss for the
   period to net cash
    used in operating activities:
    Depreciation and amortization                           66,514        66,075
    Stock option compensation                              746,692             -
    Stock issued for services                              313,890             -
    Liability in connection with settlement o
    f equity instrument                                   (267,459)            -
  (Increase) decrease in operating assets
    Prepaid expenses and other current assets                  900        (2,131)
  Increase (decrease) in operating liabilities
    Accounts payable                                        55,481        59,063
    Accrued liabilities and provisions for
     lawsuit settlements                                  (476,079)      829,973
                                                      ----------------------------

                                                          (843,756)     (603,754)
                                                      ============================


Financing activities
  Net proceeds from term debts                               7,500             -
  Issuance of common stock and stock s
  ubscriptions                                             743,924       162,817
  Loans payable                                            (32,772)      443,000
                                                      ----------------------------


                                                           718,652       605,817
                                                      ----------------------------
Net increase (decrease) in cash                           (125,104)        2,063
Cash, beginning of period                                  137,517        20,257
                                                      ----------------------------
Cash, end of period                                    $    12,413   $    22,320
==================================================================================


Supplementary disclosure of cash flow information

  Cash paid during the period
    Interest                                           $         -   $         -
    Income taxes                                       $         -   $         -
Supplementary disclosure of non-cash investing
 and financing activities
  Stock option compensation                            $   746,692   $         -
  Stock issued for services                            $   313,890   $         -
  Preferred X shares issued on settlement of accrued
  liabilities                                          $ 1,613,500   $         -
  Liability in connection with settlement of equity
  instruments                                          $   662,183   $         -
==================================================================================
</TABLE>






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

<PAGE>



                                   Turbodyne Technologies, Inc. and Subsidiaries
                                  Notes to the Consolidated Financial Statements
                                           (Unaudited - Expressed in US Dollars)
March  31,  2003  and  2002
--------------------------------------------------------------------------------

1.   Nature  of  Business  and  Ability  to  Continue  as  a  Going  Concern


     Turbodyne  Technologies, Inc., a Delaware corporation, and its subsidiaries
     (the  Company)  engineer,  develop  and market products designed to enhance
     performance  and  reduce  emissions  of  internal  combustion  engines.

     The  interim  financial statements included herein, presented in accordance
     with  United  States generally accepted accounting principles and stated in
     US  dollars,  have been prepared by the Company, without audit, pursuant to
     the  rules  and  regulations  of  the  Securities  and Exchange Commission.
     Certain information and footnote disclosures normally included in financial
     statements  prepared  in  accordance  with  generally  accepted  accounting
     principles  have  been  condensed  or  omitted  pursuant  to such rules and
     regulations,  although  the  Company  believes  that  the  disclosures  are
     adequate  to  make  the  information  presented  not  misleading.

     These  financial  statements  reflect all adjustments, consisting of normal
     recurring  adjustments,  which  in the opinion of management, are necessary
     for fair presentation of the information contained therein. It is suggested
     that  these  interim  financial  statements be read in conjunction with the
     audited  financial  statements  of the Company for the years ended December
     31,  2002  and  2001  included  in  the Company's 10-KSB Annual Report. The
     Company  follows the same accounting policies in the preparation of interim
     reports.


     Results  of operations for the interim periods are not indicative of annual
     results.



     The  accompanying  consolidated  financial  statements  have  been prepared
     assuming that the Company will continue as a going concern. The Company has
     suffered  net  losses  in  recent  periods,  has  an accumulated deficit of
     $124,875,801  at  March 31, 2003, has used cash in its operating activities
     in  recent periods, has disposed of its most significant subsidiary through
     bankruptcy,  is  subject to lawsuits brought against it by shareholders and
     other  parties,  and  based  on  the Company's projected cash flows for the
     ensuing  year  it  will  be  required  to  seek  additional  equity or debt
     financing  in order to continue its present operations, irrespective of the
     amounts to be paid, if any, in connection with the aforementioned lawsuits.
     These  matters  raise  substantial  doubt  about  the  Company's ability to
     continue  as  a  going  concern.



     The  Company's  operations  have  been  financed  principally  through  a
     combination  of  private  and  public  sales of equity and debt securities.
     Although  the Company continues to raise operating funds with a combination
     of  debt and equity instruments there is no guarantee that the company will
     be  able  to  continue to finance operations by this method. The Company is
     also  limited  in  raising  funds through the sale of equity because of the
     limited  remaining  authorized  shares  available  for  sale.



     The  Company  continues to examine it's operation and processes for further
     methods  of  cutting  costs  and gaining efficiencies. However, there is no
     assurance that the cost reductions will be realized in the full amount. The
     Company  is examining alternatives for financing and fulfilling its working
     capital  needs  based on its working capital projections. If the Company is
     unable  to  satisfactorily  settle  litigation,  including its dispute with
     Honeywell  Turbocharging Systems ("Honeywell"), a division of Allied Signal
     Inc.  ("Honeywell")  (Note  4(c)), the present holder of the Company's core
     technology  and  raise  substantial  monies or generate revenue to meet its
     working capital needs, it may have to cease operating and seek relief under
     appropriate  statutes.  If the going concern assumption was not appropriate
     for  these  consolidated  financial  statements,  then adjustments would be
     necessary to the carrying value of assets and liabilities, the reported net
     loss  and  the  balance  sheet  classification  used.


<PAGE>



                                   Turbodyne Technologies, Inc. and Subsidiaries
                                  Notes to the Consolidated Financial Statements
                                           (Unaudited - Expressed in US Dollars)

March  31,  2003  and  2002
--------------------------------------------------------------------------------

2.   Share  Capital

     Transactions  not  disclosed  elsewhere  in  these  consolidated  interim
     financial  statements  are  as  follows:



     a)   Authorized  Capital


          In  2003, 150,000 of the 1 million preferred shares were designated as
          Series X preferred shares. These shares have a par value of $0.001 per
          share  with each share being convertible into 100 common shares at the
          discretion  of  the  holder.


          As  at March 31, 2003, the Company's potentially diluted common shares
          exceeded the authorized shares. The Company has recorded $1,019,402 in
          accrued  liabilities  to  account for the potential cash settlement of
          these  financial  instruments.


     b)   During  the  three  months  ended March 31, 2003, the Company issued a
          total of 13,965,803 shares of common stock, of which, 8,533,391 shares
          were  issued in connection with private placements for net proceeds of
          $509,004,  3,249,000  shares were issued upon exercise of options with
          an  exercise  price  of  $0.08 and the remaining 2,183,412 shares were
          issued  under  the  2002  Nevada  stock  incentive  plan,  which  was
          established  by  the  Company  in  December 2002, for services with an
          ascribed  value  of  $313,890  (based  on  the  trading  price  of the
          Company's  common  stock  on the dates service agreements were entered
          into).

          In 2003, the Company also issued 122,175 Series X preferred shares, of
          which 41,500 shares were exchanged for 4,150,000 common shares held in
          escrow  by  a former director and a former officer, 45,000 shares were
          issued  to  a former director in settlement of administrative expenses
          and  the  remaining  35,675  shares were issued to a former officer in
          connection  with the settlement of outstanding litigation. As at March
          31,  2003,  the  4,150,000  shares  were still held in escrow and were
          included  as  issued  and  outstanding  shares.  The transactions were
          recorded  based  on amounts settled in agreements and resulted in 2002
          charges  of  $180,000,  $720,000  and $713,500 to selling, general and
          administrative,  research  and  development  and  litigation expenses,
          respectively.


<PAGE>
                                   Turbodyne Technologies, Inc. and Subsidiaries
                                  Notes to the Consolidated Financial Statements
                                           (Unaudited - Expressed in US Dollars)

March  31,  2003  and  2002
--------------------------------------------------------------------------------

2.   Share  Capital  -  Continued

     c)   Stock  Options

The  following  summarizes  information  relating  to stock options during 2003:

<TABLE>
<CAPTION>

                                                        2003


                               Non-employees          Employees               Total

                            -----------------------------------------------------------------

                                              Weighted           Weighted            Weighted
                                              Average            Average             Average
                                              Exercise           Exercise            Exercise

                            Options           Price    Options   Price     Options   Price
                            ------------------------------------------------------------------
<S>                         <C>              <C>    <C>         <C>    <C>          <C>

Outstanding at
 beginning of period             1,131,715   $1.28  2,291,700   $0.55   3,423,415   $0.79
Granted                          6,295,666   $0.10    300,000   $0.27   6,595,666   $0.10
Exercised                       (3,249,000)  $0.08          -   $   -  (3,249,000)  $0.08
Forfeited                                -   $   -   (200,000)  $0.35    (200,000)  $0.35
Outstanding at end of
 period                          4,178,381   $0.43  2,391,700   $0.53   6,570,081   $0.47
                            -----------------------------------------------------------------

Options exercisable at
 end of period                   4,178,381   $0.43  2,391,700   $0.53   6,570,081   $0.47
                            ===============================================================



Weighted average fair
value of options
 granted during the
 period                                  -   $0.12          -   $0.14           -   $0.12
                            ===============================================================
</TABLE>



     The  Company  repriced  the  exercise  price  of  38,000 options granted to
     employees  from  $1.87  per  share  to  $0.30  per  share.



Grant  of  Stock  Options  to  Non-employees  for  Services
     -----------------------------------------------------------

     The  Company  has  recorded  $746,692 (2002 - $Nil) of compensation expense
     relating  to  stock  options  issued to non-employees for services rendered
     during  the  period.

     The  per  share weighted average fair value of stock options granted during
     2003  and 2002 was $0.12 and $Nil, respectively, on the date of grant using
     the  Black-Scholes option-pricing model with the following weighted average
     assumptions  in  2003: expected dividend yield Nil%; expected volatility of
     141%;  risk-free interest rate of between 2.96% and 3.98% and expected life
     equal  to  1  to  4  years.


     Grant  of  Stock  Options  to  Employees  for  Services
     -------------------------------------------------------

     The  Company  applies  Accounting  Principles  Board ("APB") Opinion 25 and
     related  interpretations  in  accounting  for  stock  options  granted  to
     employees.  Generally,  under APB No. 25 compensation expense is recognized
     for  the  difference  between the market price and the underlying stock and
     the  exercise price of the stock options. Accordingly, compensation cost of
     $Nil  (2002  - $Nil) has been recognized in connection with options granted
     to  employees.  Had  compensation  cost been determined based upon the fair
     value of the stock options at the grant date consistent with the fair value
     method  prescribed  in  Statement of Financing Accounting Standard ("SFAS")
     No.  123,  the  Company's  net  loss  and  loss  per  share would have been
     increased  to  the  following  pro  forma  amounts:

<PAGE>

<PAGE>


                                   Turbodyne Technologies, Inc. and Subsidiaries
                                  Notes to the Consolidated Financial Statements
                                           (Unaudited - Expressed in US Dollars)
March  31,  2003  and  2002
--------------------------------------------------------------------------------

2.   Share  Capital  -  Continued

                                             For the three-month periods
                                                      ended March 31
                                                  2003              2002
                                         -------------------------------------
Net loss, as reported                    $  (1,283,695)   $     (1,556,734)


Deduct: Stock-based compensation expense
determined under fair-value based method
for all awards not included in net loss        (42,490)                  -
                                         -----------------------------------
Pro-forma net loss                       $  (1,326,185)   $     (1,556,734)
                                         ===================================
Loss  per  share:
Basic and diluted - as reported          $       (0.01)   $          (0.02)
                                         ===================================
Basic and diluted - pro-forma            $       (0.01)   $          (0.02)
                                         ===================================

     The  per  share  weighted  average  fair  value of stock options granted to
     employees  during 2003 was $0.14, calculated on the date of grant using the
     Black-Scholes  option  pricing  model  with  the following weighted average
     assumptions  in  2003: expected dividend yield Nil%; expected volatility of
     127%; risk-free interest rate of between 3.57% and 3.69%; and expected life
     equal  to  12  months.

     Effective  from  the  date  of  the option repricing, the Company regularly
     remeasures  compensation  expense  for  the  options where there has been a
     substantive  change  and  modification  to  such  options.  No compensation
     expenses  were  recorded as a result of repricing of options. Subsequent to
     March 31, 2003, the Company granted to non-employees 1,200,000 options with
     an  exercise price of $0.05 per share for a three year period. In addition,
     700,000  options  with an exercise price of $0.05 were exercised subsequent
     to  March  31,  2003.



     d)     Stock  Purchase  Warrants

     At  March  31,  2003,  the  Company  had 29,544,085 stock purchase warrants
     outstanding,  respectively.  These  warrants were issued in connection with
     private  placements  and  other  means  of  financing. The holders of these
     warrants  are  entitled to receive one share of common stock of the Company
     for  one  warrant exercised. The warrants have exercise prices ranging from
     $0.15  to  $4.25  per share with a weighted average exercise price of $0.47
     per  share  and  expiration  dates  between  2003  and  2006.




<PAGE>
                                   Turbodyne Technologies, Inc. and Subsidiaries
                                  Notes to the Consolidated Financial Statements
                                           (Unaudited - Expressed in US Dollars)

March  31,  2003  and  2002
--------------------------------------------------------------------------------

2.   Share  Capital  -  Continued

     Subsequent  to  March 31, 2003, the Company granted 1,100,000 warrants with
     an  exercise  price  of  $0.12  per  share  for  a  three  year  period.

     e)   Share  Buy-Back  Plan

     On  September  17,  1998, the Company announced that its Board of Directors
     authorized  the  Company  to  repurchase  up  to 3,500,000 of its shares of
     common  stock.  The  actual number of shares repurchased, and the timing of
     the  purchases,  has  been based on the stock price, general conditions and
     other  factors.  The  Company has repurchased 378,580 shares for a total of
     $1,755,534  at  March  31,  2003  and  December  31,  2002.

3.   Loan  Payable

     The  Company  has  received  from  shareholders  and other parties $126,283
     (December  31,  2002  -  $169,055)  in  unsecured  and non-interest bearing
     advances. Management expects that the amounts owing will be settled through
     the  issuance  of  common  stock  and  share  purchase  warrants.

4.   Commitments  and  Contingencies

     The Company is party to various legal claims and lawsuits which have arisen
     in  the  normal  course of business. There have been no material changes in
     the  status  of these matters since the issuance of the most recent audited
     annual  financial  statements.

     a)   Litigation

          TST

     In  March 2000, TST, Inc. ("TST"), a vendor to a subsidiary of Pacific Baja
     (Note  4(b))  filed an action against the Company alleging that in order to
     induce  TST  to  extend credit to a subsidiary of Pacific Baja, the Company
     executed  guarantees  in  favor  of  TST.  TST  alleged that the subsidiary
     defaulted  on  the  credit  facility  and  that  the  Company  is liable as
     guarantor.

<PAGE>


                                   Turbodyne Technologies, Inc. and Subsidiaries
                                  Notes to the Consolidated Financial Statements
                                           (Unaudited - Expressed in US Dollars)

March  31,  2003  and  2002
--------------------------------------------------------------------------------

4.     Commitments  and  Contingencies  -  Continued

     The  Company  and TST entered a settlement agreement and release. Under the
     terms  of  the  agreement,  the  Company  must:

          i)   Issue  1,000,000  shares  of common stock to the president of TST
               and  agree  to  register  the  resale of these shares by filing a
               registration  statement  with  the  Securities  and  Exchange
               Commission;
          ii)  Issue  2,000,000  shares  of  common  stock  to  TST;
          iii) Agree  to the immediate entry of judgement against the Company in
               the  amount of $2,068,078 plus interest from the date of entry at
               the  rate  of  10%  per annum. The amount of this judgement would
               immediately  increase  by  any  amount  that  TST is compelled by
               judgement  or  court  order  or  settlement  to  return  as  a
               preferential  transfer  in  connection  with  the  bankruptcy
               proceedings  of  Pacific  Baja;  and
          iv)  any  proceeds  received  by TST or its president from the sale of
               the  issued  shares  will  be  automatically  applied as a credit
               against the amount of the judgement against the Company in favour
               of  TST.


     At  March  31,  2003  and  December  31,  2002,  the  Company  has included
     $4,560,000  in  regard  to this matter in provision for lawsuit settlements
     and  accrued  liabilities.  The  Company has recorded the accrued liability
     related to the share issuances discussed above based on the market value of
     the  shares at the date the settlement and release agreement was signed. If
     it is determined that TST received payment in preference to other creditors
     before  Pacific  Baja filed its Chapter 11 petition in bankruptcy, TST will
     likely increase its claim by $2,130,000, which is included in the provision
     for  lawsuit  settlements.

     b)   Pacific  Baja  Bankruptcy

     In  July  1999,  a  major  creditor  of  the  Company's  wholly-owned major
     subsidiary,  Pacific Baja, began collection activities against Pacific Baja
     which  threatened  Pacific  Baja's banking relationship with, and source of
     financing  from,  Wells  Fargo  Bank.  As  a  result,  Pacific Baja and its
     subsidiaries  commenced  Chapter 11 bankruptcy proceedings on September 30,
     1999.

     Pursuant to the Bankruptcy court order, the assets were sold to the highest
     bidder at an auction on December 23, 1999, for approximately $14.4 million.
     There  were  no proceeds available for distribution to unsecured creditors,
     after  the  payment  of  Pacific  Baja's secured debt. The Company was owed
     approximately $6 million. There were no remaining assets and liabilities of
     Pacific  Baja  as  of  December  31,  1999.

     In connection with the bankruptcy proceedings, which are still pending, the
     creditors'  committee  was investigating the Company and some of its former
     directors  and  officers  as to whether preferential transfers were made to
     the  Company  and  its  affiliates  before  the  Chapter  11  case  began.



<PAGE>

                                   Turbodyne Technologies, Inc. and Subsidiaries
                                  Notes to the Consolidated Financial Statements
                                           (Unaudited - Expressed in US Dollars)
March  31,  2003  and  2002
--------------------------------------------------------------------------------

4.     Commitments  and  Contingencies  -  Continued

     In  September  2001,  the  Pacific  Baja  Liquidating  Trust  ("the Trust")
     commenced  action  against  a  former  subsidiary  in  the  United  States
     Bankruptcy  Court, Central District of California - Riverside Division. The
     Trust was established under the Pacific Baja bankruptcy proceedings for the
     benefit  of  the  unsecured  creditors  of  Pacific  Baja.

          The  Trust  is  seeking,  among  other  matters,:

     i)   the  re-characterization of Company advances to Pacific Baja as equity
          and  the  subordination  of  unsecured  claims  against  Pacific Baja;
     ii)  the  re-conveyance  of  an aggregate of up to approximately $7,190,000
          transferred  by  Pacific  Baja  to  the  Company  on  the  basis of an
          allegation  of  fraudulent  transfer;
     iii) an  order  that the Company is liable for all of the previous debts of
          Pacific  Baja  totalling  approximately  $7,000,000;  and
     iv)  Damages  and  punitive  damages against the Company and certain former
          officers  and  directors  and  the  former  officers  and directors of
          Pacific Baja in the amount of up to approximately $12,000,000 based on
          various  allegations  of fraud, misrepresentation, breach of contract,
          alter  ego  and  negligence.

     The  Company has filed a response denying liability. The Company intends to
     vigorously  contest and defend any claim by the Trust that would exceed its
     claims as a creditor of Pacific Baja and that would be satisfied other than
     by  a  set-off  of  its  claims  against  Pacific Baja. The outcome of this
     litigation  is not presently determinable and no amounts have been included
     in  this  regard  in  the  reserve  for  lawsuit  settlements.

     In  May  2000,  Heartland  Financial Corporation ("Heartland"), a firm that
     provided investment banking services to Pacific Baja, filed a complaint for
     arbitration against the Company seeking approximately $600,000 representing
     a  success  fee it claims it is entitled to for investment banking services
     provided to Pacific Baja based on a letter agreement between Heartland, the
     Company  and  Pacific  Baja. After the letter agreement was signed, Pacific
     Baja  filed  a  Chapter 11 petition in bankruptcy. At the conclusion of the
     bankruptcy proceedings, the bankruptcy court awarded Heartland a portion of
     its  fees.  Heartland  then sought the balance of the fees and has obtained
     judgement  against  the  Company  in  the amount of approximately $535,000,
     which  is  included  in the legal liability reserve. During the three-month
     period  ended March 31, 2003, the Company paid $250,000 towards the partial
     settlement  of  these  claims.

<PAGE>

                                   Turbodyne Technologies, Inc. and Subsidiaries
                                  Notes to the Consolidated Financial Statements
                                           (Unaudited - Expressed in US Dollars)

March  31,  2003  and  2002
--------------------------------------------------------------------------------


4.     Commitments  and  Contingencies  -  Continued

     c)   In  1999,  the  Company  entered  into joint development and licensing
          agreements  which  were subsequently amended with Honeywell. Under its
          agreements  with  Honeywell,  the  Company  assigned  to Honeywell its
          patent and trademark portfolio (including both the Dynacharger(TM) and
          the Turbopac(TM)) for $6.8 million. This amount was used in settlement
          of  a  judgment.  In addition, under these agreements, the Company and
          Honeywell  were  to share the development costs of the Dynacharger(TM)
          and  the  Turbopac(TM), the Company 40% and Honeywell 60%. The Company
          retains  the sole worldwide rights to manufacture, market and sell all
          motors,  generators,  electronic  controls  and  light  metals for the
          Dynacharger(TM)  and  Turbopac(TM),  and  Honeywell  holds  the  sole
          worldwide  rights  to manufacture, market and sell the Dynacharger(TM)
          and  Turbopac(TM)  product  lines.  The  Company  will  receive  from
          Honeywell  royalties  of 3.7% (subject to adjustment) of the net sales
          of  the  Dynacharger(TM)  and  Turbopac(TM)  product  lines.

     The Company commenced an action for damages against Honeywell in the United
     States  District  Court,  Central  District  of  California  in August 2001
     alleging,  among  other  matters,  that  Honeywell's  conduct constituted a
     restraint  of trade and the delay of the commercialization of the Company's
     technology.  The  Company  was  seeking unspecified damages and costs. This
     litigation  has  been  withdrawn  pending  the  outcome  of the arbitration
     proceedings  discussed  below.

     Prior  to  the  Company  commencing  the above legal proceedings, Honeywell
     initiated arbitration proceedings under the joint development and licensing
     agreements.  Honeywell  is  seeking  unspecified  damages  and  costs  and
     termination  of  the  license agreement and the joint development agreement
     based  on their allegations that the Company breached the agreements and is
     unwilling  and  unable  to perform future obligations under the agreements.

     The  outcome  of the legal matters regarding the dispute with Honeywell are
     not  presently  determinable.

     d)     Other

     The  Company  is  currently involved in various collection claims and other
     legal  actions.  It  is not possible at this time to predict the outcome of
     the  legal  actions.

5.   New  Accounting  Pronouncements

     FASB  Interpretation  ("FIN")  No.  46, "Consolidation of Variable Interest
     Entities",  clarifies  the  application of Accounting Research Bulletin No.
     51,  "Consolidated  Financial  Statements",  to  certain  entities in which
     equity investors do not have the characteristics of a controlling financial
     interest or do not have sufficient equity at risk for the entity to finance
     its activities without additional subordinated financial support from other
     parties.  FIN  46  is applicable immediately for variable interest entities
     created  after  January  31,  2003.  For variable interest entities created
     prior to January 31, 2003, the provisions of FIN 46 are applicable no later
     than  July  1,  2003.

     The  Company  is  currently  reviewing  FIN  46  and  does  not  expect its
     implementation  to  have  a  material  effect  on  the  Company's financial
     statements.


<PAGE>


                                   Turbodyne Technologies, Inc. and Subsidiaries
                                  Notes to the Consolidated Financial Statements
                                           (Unaudited - Expressed in US Dollars)
March  31,  2003  and  2002
--------------------------------------------------------------------------------

6.     Subsequent  Event

     Subsequent  to  March  31,  2003,  the Company entered into a licensing and
     technology  transfer  agreement.  Under  the  terms  of  the agreement, the
     Company received a $150,000 credit against pre-existing indebtedness to the
     licensee  and  a  payment  of  $250,000  for licensing of the DynachargerTM
     technology  and  will  receive royalties of 3% of the net sales of licensed
     products made, used or sold by the licensee. In the event that the licensee
     sells  an  aggregate  of  200,000  or  more units in any calendar year, and
     remains  current in its royalty payments, then the royalty payable for each
     additional unit sold during such calendar year will be reduced to 2% of net
     sales.

7.   Comparative  Amounts

     Certain  comparative  amounts  have been restated to conform to the current
     period's  presentation.



<PAGE>




Item  2.     Management's  Discussion  and  Analysis  or  Plan  of  Operations

FORWARD  LOOKING  STATEMENTS

The  information  in  this discussion contains forward-looking statements within
the  meaning  of  Section  27A  of  the  Securities Act of 1933, as amended, and
Section  21E  of  the  Securities  Exchange  Act  of  1934,  as  amended.  These
forward-looking statements involve risks and uncertainties, including statements
regarding  the  Company's capital needs, business strategy and expectations. Any
statements  contained  herein that are not statements of historical facts may be
deemed  to  be  forward-looking  statements.  In  some  cases,  you can identify
forward-looking  statements  by  terminology  such  as  "may", "will", "should",
"expect",  "plan",  "intend",  "anticipate",  "believe",  "estimate", "predict",
"potential"  or  "continue",  the  negative  of  such  terms or other comparable
terminology. Actual events or results may differ materially. In evaluating these
statements, you should consider various factors, including the risks outlined in
the  Risk  Factors  section  below, and, from time to time, in other reports the
Company files with the SEC. These factors may cause the Company's actual results
to  differ  materially from any forward-looking statement. The Company disclaims
any  obligation  to publicly update these statements, or disclose any difference
between  its  actual  results  and  those  reflected  in  these  statements. The
information  constitutes  forward-looking  statements  within the meaning of the
Private  Securities  Litigation  Reform  Act  of  1995.

OVERVIEW

We are a design and engineering company engaged in the design and development of
air  charging  technology  that  enhances the performance of internal combustion
engines.  Our  technology  is  based  on  DC/AC,  high-speed,  high-powered,
electronically  commutated  electric  motors.   Our  business  strategy involves
entering into license agreements with original equipment manufacturers ("OEM's")
in  the  automotive  industry  who  would  incorporate our technology into their
product  lines in exchange for the payment of royalties or other similar license
fees.

We have incorporated our technology into two initial primary products, which are
(1)  the  Dynacharger(TM)  and  (2)  the  Turbopac(TM).  We  transferred  the
intellectual  property  associated with our Dynacharger and Turbopac products to
Honeywell, Inc. ("Honeywell") in 1999.  Our rights to these products are now the
subject of a license agreement and a joint development agreement with Honeywell.
We  are  now  involved  in  legal  proceedings  regarding  our  agreements  with
Honeywell.  Honeywell  is seeking termination of the license agreement and joint
development  agreement  and  damages  from  us.  See  Item  1 of Part II - Legal
Proceedings.

We are presently finalizing the development of additional products incorporating
new  technology,  including a product known as the TurboAir.  These new products
are  in  various stages of design and development.  Our ability to commercialize
these  new products is conditional upon us entering into arrangements with OEM's
that  provide for the final development and manufacturing of these products.  We
have begun to enter into development agreements for the manufacture of prototype
TurboAir units that will be used for testing and evaluation purposes by original
equipment  manufacturers.

We  are  currently  in  a transition phase of our business to an engineering and
design business from a business model that originally included manufacturing and
marketing  of products incorporating our technology.   Our operating results for
the  three  months  ended  March 31, 2003 reflect the fact that Honeywell is not
proceeding  with  the commercialization of the Turbopac and Dynacharger products
and  we  are  not  earning  revenues under our license agreement with Honeywell.

We  are  currently  not  earning  any  revenues under our license agreement with
Honeywell  or  through sales of products incorporating our new technology, other
than  through development agreements for manufacture of prototypes.  None of our
products  are  currently  being  sold  commercially.

PLAN  OF  OPERATIONS

Our  plan  of  operations  over  the  next  twelve  months  is  to undertake the
following:

                                       3

<PAGE>

1.   We  plan  to continue research and development of our TurboAir product with
     the  objective  of  completing  the  necessary  development  work  for
     commercialization  of  this  product. This work will include development of
     prototypes  under  development  agreements  with  original  equipment
     manufacturers.  We  plan  to  spend approximately $650,000 in pursuing this
     research  and  development  over  the  next  twelve  month  period;

2.   We plan to manufacture prototypes of our Dynacharger, Turbopac and TurboAir
     products under development agreements with original equipment manufacturers
     that  we  have  entered into. These prototypes will be used for testing and
     evaluation  purposes. We plan to spend approximately $450,000 in completing
     our  obligations  under  development  agreements over the next twelve month
     period;

3.   We plan to pursue negotiations with original equipment manufacturers in the
     automobile  industry  ("OEM's")  for  the  incorporation  of  our  TurboAir
     products  into  the  OEM's  product  lines.  We plan to spend approximately
     $85,000  in  pursuing these negotiations over the next twelve month period;

4.   We plan to continue research and development of our products, including new
     products  incorporating  our  e-boosting  technology, with the objective of
     completing  the  necessary  development work for commercialization of these
     products. We plan to spend approximately $450,000 in pursuing this research
     and  development  over  the  next  twelve  month  period;

5.   We  plan  to  pursue  resolution  of the outstanding litigation against us,
     including  resolution of the claims summarized in Item 1 of Part II of this
     Quarterly Report on Form 10-QSB. We plan to spend approximately $450,000 in
     litigation  expenses  over  the  next  twelve  month  period;

6.   We  anticipate  spending  approximately $750,000 in administrative expenses
     over the next twelve months in maintaining our head office and staff in our
     Carpenteria,  California  office.

We  had  cash  of  $12,413 as at March 31, 2003 and a working capital deficit of
$11,623,197  as at March 31, 2003.  Our plan of operations calls for us to spend
approximately $2,835,000 over the next twelve months, with approximately half of
this  amount  being  incurred over the next six months.  Accordingly, we are not
able  to  pursue  our  stated  plan of operations without substantial additional
financing.  We  are  pursuing  additional  sales  of  our common stock and share
purchase  warrants  to  raise  the  financing  necessary  for  us  to  continue
operations.  We  have  no  arrangements in place for additional equity financing
and there is no assurance that additional equity financing will be obtained.  We
believe  that conventional debt financing is not a financing option to us due to
the  development  stage of our products, our lack of revenues and the litigation
to which we are party.  Based on these risks, there is no assurance that we will
be  able  to carry out our plan of operations. If we achieve less financing than
required  to  pursue  our  stated  plan of operations, then we will be forced to
reduce  our  research and development activities and our administrative overhead
costs.

RESULTS  OF  OPERATIONS

Net  Sales

We  did  not  achieve  any sales during the three months ended March 31, 2003 or
during  the  three  months  ended March 31, 2002.  Our current inability to earn
revenues  reflects  the  fact  that  (i)  our new TurboAir product and other new
products  remain  in the development stage; and (ii) we are not able to earn any
revenues  pursuant  to  our license agreement with Honeywell as Honeywell is not
completing  any  sales of the Turbopac or Dynacharger products.  There have been
no  sales  of  the  Turbopac(TM)  product  by  Honeywell since June 2000 and our
Dynacharger  product  remains  in  development.

We  anticipate  that  we  will complete sales of prototypes during 2003 that are
designed  and  manufactured  pursuant  to  development  agreements  that we have
entered  into.  These  sales  will not be significant in relation to our overall
operating  costs.  We  anticipate  that  we  will  not  be  able to generate any
significant  sales  of  the  Turbopac  or  Dynacharger  products  until  we  are
successful  in  entering into a new license and manufacturing arrangement with a
new automotive OEM.  We anticipate that we will not be able to generate sales of
our

                                       4

<PAGE>


TurboAir  products  until  we  are  able to enter into an agreement with an
automotive  OEM  for  the final development and manufacture of this product.  We
anticipate  sales  of  prototypes will be offset against corresponding expenses.

Costs  of  Sales

We  did not have any costs of sales during the three months ended March 31, 2003
or  the  three  months  ended  March 31, 2002 in view of the fact that we had no
sales  during  each  of  these  periods.  We did not engage in any manufacturing
activity  during the three months ended March 31, 2003 or the three months ended
March  31,  2002.  We  anticipate  that  we will not undertake any manufacturing
activity  during 2003, other than manufacturing of prototypes for evaluation and
demonstration  purposes.

Gross  Profit

Gross profit was nil for the three months ended March 31, 2003 and for the three
months  ended  March  31, 2002 and reflects the fact that we were not engaged in
any  manufacturing  activities  during  each  of  these  periods.

Selling,  General  and  Administrative  Expenses

Selling,  general  and  administrative expenses for the three months ended March
31,  2003  increased  to $361,225 from $267,675 for the three months ended March
31,  2002,  representing  an  increase  of $93,550 or 35%.   The increase in our
selling,  general  and  administrative  expenses  was  attributable to increased
activity during the first quarter in connection with development agreements that
we  have  entered  into.  General  and  administrative  costs  included expenses
associated  with  our  Carpinteria,  California office, management compensation,
administrative  staff and overhead.  Selling expenses were minimal and reflected
the  fact  that  none  of  our  products are being commercially sold at present.

Research  and  Development

Research  and  development  costs  for  the  three  months  ended March 31, 2003
increased to $1,001,214 from $954,853 for the three months ended March 31, 2002,
representing  an  increase  of  $46,361  or  approximately  5%.  The increase in
research  and  development  costs was attributable to increased development work
relating  to  the  manufacture  of  prototypes  for  evaluation  purposes  under
development  agreements.  Our  research  and  development  activities during the
three  months  ended  March  31,  2003  did  not  include any joint research and
development  with  Honeywell  and  involved  primarily  developing  and  testing
prototypes  of  our  TurboAir  products.  Approximately  25% of our research and
development  expenses  in  our  first  quarter  of 2003 were attributable to our
research and development of new products which have yet to reach the stage where
we  have  determined  to  pursue  development agreements with original equipment
manufacturers.  Our research and development costs related to present and future
products  are charged to operations in the period incurred. Current research and
development  costs  are associated with our development of our TurboAir products
and  new  products.

Compensation  Expense

We  increased  our  reliance  on  stock  based compensation in order to fund our
operations  during 2002 and the first quarter of 2003 due to our limited ability
to  raise  funds  for these activities through sales of our equity securities or
from  revenues  generated  by  operations.   Stock  based  compensation was used
primarily  to  fund  our  research  and  development  activities.  Stock  based
compensation  included in expenses was $746,692 for the three months ended March
31,  2003,  equaling 58% of total expenses during our first quarter of 2003.  We
anticipate  that  we  will  continue  to  fund  our  expenses  using stock based
compensation  payable  to  our  employees  and  consultants  during  2003.

We recognize compensation expense in accordance with Accounting Principles Board
Opinion No. 25.   Generally, under APB No. 25 compensation expense is recognized
for  the  difference  between  the  market price of the underlying stock and the
exercise  price  of  the  stock options.  This method of accounting is different
from  the  fair  value  method of accounting that is prescribed by SFAS No. 123.
Had  we  adopted  the  fair  value


                                       5

<PAGE>


method  of  accounting,  our  total  stock-based compensation expense would have
increased  by  $42,490 with the result that our net loss would have increased to
$1,326,185  from  $1,283,695  and  our loss would have remained $0.01 per share.
This  pro  forma  information  is  disclosed  in further detail in Note 2 to our
financial  statements  under  the  heading  "Share  Capital".

Litigation  Expense

We  recorded  a recovery related to litigation in the amount of $144,791 for the
three  months  ended March 31, 2003 compared to litigation expense in the amount
of  $270,901  for the three months ended March 31, 2002.    The recovery related
to  litigation  during  our  first  quarter  represented  proceeds  received  in
connection  with  a previously outstanding legal proceeding, less legal expenses
incurred  during our first quarter.  Our litigation expenses are attributable to
our  involvement  in  the legal proceedings described in Item 3 of Part I of our
Annual  Report on Form 10-KSB.  The most significant component of our litigation
expense  remains  legal  expenses attributable to our litigation with Honeywell.
Litigation  expenses  during  the  balance  of  2003  are anticipated to consist
primarily  of  legal expenses relating to the pending arbitration proceedings in
the  Honeywell  dispute.

Net  Loss

Our  net  loss for the three months ended March 31, 2003 decreased to $1,283,695
from  a  net  loss  of  $1,556,734  for  the  three months ended March 31, 2002,
representing  a  decrease  of  $273,039.  Our  continued  net losses reflect our
continued  operating  expenses  and  our current inability to generate revenues.

FINANCIAL  CONDITION

Cash  and  Working  Capital

We  had  cash of $12,413 as at March 31, 2003, compared with cash of $137,517 as
at  December  31, 2002.  Our working capital deficit decreased to $11,623,197 as
at  March  31,  2003, compared to a working capital deficit of $12,904,380 as at
December  31, 2002.   The reduction to our working capital deficit was primarily
attributable  to  a  reduction to accrued liabilities and provisions for lawsuit
settlements,  as  discussed  below

Liabilities

The  largest  component  of our working capital deficit is a reserve for lawsuit
settlements  in  the  amount  of  $4,059,909  as  at March 31, 2003, compared to
$4,309,909  as  at  December  31,  2002.

Our  accounts  payable  and  accrued  liabilities  remain substantial due to our
inability  to generate revenues and our limited ability to raise capital to fund
our  operations.   Accounts payable increased to $3,498,022 as at March 31, 2003
from  $3,442,541  as  at  December  31,  2002.  Accrued liabilities decreased to
$3,884,119  as  at  March  31, 2003 from $5,061,515 as at December 31, 2002.  We
have  continued during 2002 and are continuing during 2003 to negotiate with our
creditors  for  the  payment  of  our  accounts payable and accrued liabilities.
Payment  of  these  liabilities is contingent on new funding being received that
would  enable  us to make payment to the creditors.  Our ability to continue our
operations  is  also  conditional  upon  the  forbearance  of  our  creditors.

Short term loans from shareholders and other parties decreased to $126,283 as of
March  31,  2003  from  $169,055  as  of  December  31,  2002.  These  loans are
unsecured,  non-interest  bearing  advances that we anticipate will be converted
into  shares  of our common stock and share purchase warrants.  These loans have
not  been  converted  to  date.

Cash  Used  in  Operating  Activities

Cash  used in operating activities for the three months ended March 31, 2003 was
$843,756,  compared  to  $603,754  for  the  three  months ended March 31, 2002,
representing  an  increase  of  $240,002  or  40%.  The increase in cash used in
operating  activities  necessitated that we increase our financing activities in
order  to  fund  our  operations.

                                       6

<PAGE>


Cash  Provided  by  Financing  Activities

We  have  continued  to finance our business primarily through private placement
sales  of  our  common  stock,  exercises  of  stock  options, short term loans,
conversion  of  accrued  liabilities  into  stock  and  through increases in our
accrued  liabilities  and  accounts  payable.   Cash  provided  by  financing
activities  for  the three months ended March 31, 2003 was $718,652, compared to
$605,817  for  the  three  months  ended  March  31,  2002.

Financing  activities  included  the issuance of common stock and share purchase
warrants  for aggregate proceeds of $509,004 during the three months ended March
31,  2003  in  private  placement  transactions.  These  private  placement
transactions  included  the  issue  of  an  aggregate of 8,533,391 shares of our
common  stock  and  associated  share purchase warrants, representing an average
price  of  $0.06 per share.  We issued 3,249,000 shares upon exercise of options
with an exercise price of $0.08 per share.   We issued an aggregate of 2,183,412
shares  in  consideration  for  payment  of services having an ascribed value of
$313,890.  The  ascribed value is based on the trading price of our common stock
on  the  dates  the  service  agreements  were  entered into.  All shares issued
pursuant  to stock option exercises and as payment for services during our first
quarter  were  registered on Form S-8 registration statements that we filed with
the  Securities  and  Exchange  Commission.

Financing  Requirements

We  are  continuing  with a restructuring program that began in 1999 in order to
reduce  our  working  capital  requirements.  This  restructuring  program  has
included  the  reduction  of  debts,  settlement  of  lawsuits, closing offices,
efforts  to  sublet  unused space at our headquarters, staff reduction and staff
attrition,  disposal  of  unnecessary  assets  and  overall attempts at reducing
operating  costs.  In  addition  we  focused  our  resources  on  research  and
development  of  our  products  incorporating our proprietary technology, rather
than  manufacture  of  our  developed  products.

We  currently  have  minimal cash and working capital resources.  We do not have
adequate  financial  resources  in  order  to enable us to continue our business
operations without additional financing.  Our current sources of working capital
are  sufficient  to  satisfy  our  anticipated  working  capital  needs  for
approximately  the  next  two  weeks.  We  may  not be able to obtain additional
working  capital  on  acceptable  terms,  or  at  all.  Accordingly,  there  is
substantial  doubt  about  our  ability  to  continue  as  a  going  concern.

We  will  require  additional financing if we are to continue as a going concern
and  to  finance  our  business  operations.  We  anticipate that any additional
financing  would  be  through  the  sales  of  our  common or preferred stock or
placement  of  convertible  debt. We are presently in the process of negotiating
private  placements  of  our  securities to raise working capital to finance our
operations.  However,  we  do not have any arrangements in place for the sale of
any  of  our  securities and there is no assurance that we will be able to raise
the additional capital that we require to continue operations. In the event that
we  are  unable  to  raise additional financing on acceptable terms, then we may
have  to  scale  back  our  plan  of operations and operating expenditures.   We
anticipate that we will continue to incur losses until such time as the revenues
we  are  able  to  generate  from licensing of our products exceed our increased
operating  expenses. We base this expectation in part on the expectation that we
will  incur  increased  operating  expenses  in  completing  our  stated plan of
operations  and there is no assurance that we will generate revenues that exceed
these  expenses.

Our  authorized  capital  currently includes 150,000,000 shares of common stock.
We  had  133,298,187  shares of common stock outstanding as of May 14, 2003.  In
addition,  we  had  warrants  to  purchase 29,544,085 shares of our common stock
outstanding  as  of  March  31,  2003  and we had 122,175 shares of our Series X
preferred  shares outstanding that are convertible into an additional 12,217,500
shares  of  our common stock.  If all share purchase warrants were exercised and
all  Series  X preferred shares were converted, the number of required shares of
common  stock  would  exceed  the  authorized  number of shares of common stock.
Accordingly,  we  have  recorded  a  liability  of $1,019,402 to account for the
potential  cash  settlement  of  these  outstanding  share purchase warrants and
convertible shares of Series X preferred stock.  Our limited remaining number of
shares  of  authorized common stock may adversely impact on our ability to raise
additional  financing  through  additional  private  placements.


                                       7

<PAGE>


CRITICAL  ACCOUNTING  POLICIES

Our  consolidated  financial  statements  have  been prepared in accordance with
accounting  principles  generally  accepted  in the United States of America. As
such,  some accounting policies have a significant impact on the amount reported
in  these  financial  statements.  A  summary  of  those  significant accounting
policies  can  be found in the Summary of Significant Accounting Policies in our
consolidated  audited financial statements included in our Annual Report on Form
10-KSB  for the year ended December 31, 2002.  Note that our preparation of this
Quarterly  Report  on  Form 10-QSB requires us to make estimates and assumptions
that  affect  the  reported  amount  of  assets  and  liabilities, disclosure of
contingent  assets  and liabilities at the date of our financial statements, and
the  reported amounts of revenue and expenses during the reporting period. There
can be no assurance that actual results will not differ from those estimates. We
believe  our  most critical accounting policies include stock-based compensation
and  legal  contingencies  as  explained  below.

Substantial  Doubt  as  to  Our  Ability  to  Continue  as  a  Going  Concern

Our financial statements included with this Quarterly Report on Form 10-QSB have
been  prepared  assuming  that  we  will  continue  as a going concern.  We have
suffered  net  losses  in  recent periods resulting in an accumulated deficit of
$124,875,801  at  March  31, 2003, have used cash in our operating activities in
recent  periods,  have  disposed  of  our  most  significant  subsidiary through
bankruptcy, are subject to lawsuits brought against us by shareholders and other
parties,  and based on our projected cash flows for the ensuing year, we will be
required  to  seek  additional equity or debt financing in order to continue our
present  operations,  irrespective  of  the  amounts  to  be  paid,  if  any, in
connection  with  the  aforementioned lawsuits.  These matters raise substantial
doubt  about  our  ability  to  continue  as  a  going  concern.

Stock  Based  Compensation

We  account  for  our employee stock-based compensation plans in accordance with
APB  No. 25  "Accounting for Stock Issued to Employees" and Financial Accounting
Standards  Board  Interpretation  ("FIN")  No.44,  "Accounting  for  Certain
Transactions  Involving  Stock  Compensation--an Interpretation of APB  No. 25",
and  comply  with the disclosure provisions of Statement of Financing Accounting
Standard  ("SFAS")  No.  123,  "Accounting  for  Stock-Based  Compensation".
Accordingly,  no  compensation  cost  is  recognized  for any of our fixed stock
options  granted  to  employees when the exercise price of each option equals or
exceeds  the  fair value of the underlying common stock as of the grant date for
each  stock  option.  Changes  in  the  terms  of  stock  option grants, such as
extensions  of  the  vesting  period or changes in the exercise price, result in
variable  accounting  in  accordance  with APB No. 25. Accordingly, compensation
expense  is  measured  in  accordance  with  APB  No. 25 and recognized over the
vesting  period.  If  the  modified  grant  is  fully  vested,  any  additional
compensation  costs  are  recognized  immediately.  Under  variable  accounting,
changes  in  the  underlying price of our stock may have a significant impact to
earnings.  A rise in the stock price would be treated as additional compensation
expense  and  a  decrease  in  the  stock  price  would result in a reduction of
reported  compensation  expense.  We  account  for  equity instruments issued to
non-employees  in  accordance  with  the  provisions  of  SFAS  No.  123.

Legal  Contingencies

We  are currently involved in legal proceedings regarding shareholder litigation
and  other  general legal proceedings.  These legal proceedings are discussed in
Note  4  to  our  interim  financial statements and in Item 1 of Part II of this
Quarterly  Report.  Where  appropriate, we have accrued amounts which we believe
we  will  be  required  to  pay to settle litigation.  We believe that the other
lawsuits  will be settled in our favor or are without merit and intend to defend
against  them  vigorously.  We  do  not  believe  these  proceedings will have a
material  adverse effect in our consolidated financial position. It is possible,
however,  that  future  results  of  operations  for any particular quarterly or
annual period could be materially affected by changes in our assumptions, or the
effectiveness  of  our  strategies,  related  to  these  proceedings.

NEW  ACCOUNTING  PRONOUNCEMENTS

FIN 46, "Consolidation of Variable Interest Entities", clarifies the application
of  Accounting Research Bulletin No. 51, "Consolidated Financial Statements", to
certain  entities in which equity investors do not have the


                                       8

<PAGE>


characteristics  of  a  controlling financial interest or do not have sufficient
equity  at  risk  for  the  entity  to finance its activities without additional
subordinated  financial  support  from  other  parties.  FIN  46  is  applicable
immediately  for  variable interest entities created after January 31, 2003. For
variable  interest entities created prior to January 31, 2003, the provisions of
FIN  46  are  applicable  no  later  than  July  1,  2003.

The Company is currently reviewing FIN 46 and does not expect its implementation
to  have  a  material  effect  on  the  Company's  financial  statements.


ITEM  3.     CONTROLS  AND  PROCEDURES.

As  required  by  Rule  13a-15  under  the  Securities Exchange Act of 1934 (the
"Exchange Act"), we carried out an evaluation of the effectiveness of the design
and operation of our disclosure controls and procedures within the 90 days prior
to  the  filing  date of this report.  This evaluation was carried out under the
supervision  and  with  the  participation  of  our Chief Executive Officer, Mr.
Daniel  Black  and our Chief Financial Officer, Mr. Charles Caverno.  Based upon
that  evaluation,  our  Chief  Executive  Officer  and  Chief  Financial Officer
concluded  that  our  disclosure controls and procedures are effective in timely
alerting  management  to  material  information  relating  to  us required to be
included in our periodic SEC filings.  There have been no significant changes in
our  internal  controls  or  in  other  factors  that could significantly affect
internal  controls  subsequent  to  the  date  we  carried  out  our evaluation.

Disclosure  controls  and  procedures are controls and other procedures that are
designed  to  ensure  that  information  required to be disclosed in our reports
filed or submitted under the Exchange Act is recorded, processed, summarized and
reported,  within  the  time  periods  specified  in the Securities and Exchange
Commission's  rules  and  forms.  Disclosure  controls  and  procedures include,
without  limitation, controls and procedures designed to ensure that information
required  to  be  disclosed  in  our  reports  filed  under  the Exchange Act is
accumulated  and  communicated  to  management,  including  our  Chief Executive
Officer  and  our  Chief  Financial Officer, to allow timely decisions regarding
required  disclosure.



                           PART II - OTHER INFORMATION

Item  1.          Legal  Proceedings

We  are  a party to the legal proceedings described in our Annual Report on Form
10-KSB,  as filed with the Securities and Exchange Commission on April 15, 2003.
The  presence  of  the  law  suits  is one of the facts cited by our auditors as
giving rise as to the substantial doubt about our ability to continue as a going
concern.  Accordingly,  readers  are  encouraged  to  review the full disclosure
regarding  these  legal proceedings, as disclosed in Item 3 of the Annual Report
on  Form  10-KSB,  together  with  this  disclosure.

We are not party to any new legal proceedings that have been commenced since the
date  of  our  Annual  Report  on  Form  10-KSB.

Our Annual Report on Form 10-KSB includes disclosure of material developments to
legal proceedings to which we are or were a party during our first quarter.  Set
forth  below  is  a  description  of  material  developments  in  the previously
disclosed legal proceedings to which we are a party that have occurred since the
date  of  our  Annual  Report  on  Form  10-KSB:

1.   We  filed  an  action  in Superior Court of the State of California for the
     County  of  Santa Barbara (Case No. 01046250) in March 2001 against Wendell
     Anderson,  Gerhard Delf, Sadayappa K. Durairaj, Naresh C. Saxena, Mugerdish
     Balabanian,  Kenneth  Fitzpatrick,  Alain G. Chardon, Joseph D. Castano and
     Marsha  Chandler.  We  have  agreed  to  settle  the  counter-claims of Mr.
     Anderson against us made in this litigation by the payment of the amount of
     $39,495  by  us  to  Mr.  Anderson,  provided that this amount will only be
     payable  if  we  receive  a  monetary recovery resulting from our legal and
     arbitration  proceedings  with  Honeywell  International. The settlement is
     subject to the execution of definitive settlement agreements between us and
     Mr.  Anderson.  We  determined  to  abandon  this  law  suit


                                       9

<PAGE>


     against  all  other defendants, other than Mr. Delf. Mr. Delf is one of our
     former  directors  and  our  former chief executive officer. We are seeking
     damages for alleged breach of fiduciary duty by Mr. Delf in connection with
     his  handling  of our dealings with Sheppard, Mullin, our former securities
     legal  counsel,  that  gave rise to our litigation against Sheppard, Mullin
     and  our  acquisition of Pacific Baja. Mr. Delf has filed a cross-complaint
     against  us  for indemnity and for compensation alleged to be payable by us
     to  Mr.  Delf  relating  to his former position as chief executive officer.


 Item  2.     Changes  in  Securities

During  the  three  months  ended  March 31, 2003, we completed the sales of the
following  securities that were not registered pursuant to the Securities Act of
1933  (the  "1933  Act"):

1.   On  January  2,  2003  we  completed  a private placement with one non-U.S.
     investor of 37,300 units at a price of $0.04 per unit for total proceeds of
     $1,492.  Each  unit  consists  of  one  common  share  and one common share
     purchase  warrant.  Each common share purchase warrant entitles the warrant
     holder  to  purchase  one common share at a price of $0.38 for a three year
     term  from  the  date of closing. A total of 37,300 shares and 37,300 share
     purchase  warrants  were  issued.  No  commissions  or  fees  were  paid in
     connection  with  the  offering.  The  sales  were  completed  pursuant  to
     Regulation  S  of  the  Act  on  the basis that the purchaser is a non-U.S.
     person,  as  defined  under  Regulation S of the Act. All securities issued
     were  endorsed  with  a  restrictive  legend confirming that the securities
     cannot  be  resold  without  registration  under  the  Act or an applicable
     exemption  from  the  registration  requirements  of  the  Act.

2.   On  January  2,  2003  we  completed  a private placement with one non-U.S.
     investor of 10,000 units at a price of $0.14 per unit for total proceeds of
     $1,400.  Each  unit  consists  of  one  common  share  and one common share
     purchase  warrant.  Each common share purchase warrant entitles the warrant
     holder  to  purchase  one common share at a price of $0.38 for a three year
     term  from  the  date of closing. A total of 10,000 shares and 10,000 share
     purchase  warrants  were  issued.  No  commissions  or  fees  were  paid in
     connection  with  the  offering.  The  sales  were  completed  pursuant  to
     Regulation  S  of  the  Act  on  the basis that the purchaser is a non-U.S.
     person,  as  defined  under  Regulation S of the Act. All securities issued
     were  endorsed  with  a  restrictive  legend confirming that the securities
     cannot  be  resold  without  registration  under  the  Act or an applicable
     exemption  from  the  registration  requirements  of  the  Act.

3.   On  January  27,  2003  we  completed a private placement with one non-U.S.
     investor  of  634,000  shares at a price of $0.05 per share for proceeds of
     $31,700.  No commissions or fees were paid in connection with the offering.
     The  sales  were completed pursuant to Regulation S of the Act on the basis
     that  the  purchaser is a non-U.S. person, as defined under Regulation S of
     the  Act.  All  securities  issued  were endorsed with a restrictive legend
     confirming  that the securities cannot be resold without registration under
     the  Act  or  an applicable exemption from the registration requirements of
     the  Act.

     4.   On  January  28,  2003, we completed the sale of 3,933,333 shared at a
          price  of  $0.06 per share for proceeds of $236,000 to four investors.
          No  commissions or fees were paid in connection with the offering. The
          sales  were completed pursuant to Section 4(2) of the Act on the basis
          that  the  purchasers are sophisticated purchasers. The purchasers are
          accredited  investors  and  are  existing shareholders. All securities
          issued  were  endorsed  with  a restrictive legend confirming that the
          securities  cannot  be resold without registration under the Act or an
          applicable  exemption  from  the registration requirements of the Act.

     5.   On February 7, 2003 we completed a private placement with one non-U.S.
          investor  of 815,000 shares at a price of $0.05 per share for proceeds
          of  $40,750.  No  commissions or fees were paid in connection with the
          offering. The sales were completed pursuant to Regulation S of the Act
          on the basis that the purchaser is a non-U.S. person, as defined under
          Regulation  S  of  the Act. All securities issued were endorsed with a
          restrictive  legend  confirming  that  the securities cannot be resold
          without registration under the Act or an applicable exemption from the
          registration  requirements  of  the  Act.

                                       10

<PAGE>


     6.   On  February  27,  2003,  we  completed the sale of 100,000 units at a
          price  of $0.10 per unit for proceeds of $10,000 to one investor. Each
          unit  was  comprised  of  one  share of our common stock and one share
          purchase  warrant.  Each share purchase warrant entitles the holder to
          purchase  one  share of our common stock at a price of $0.20 per share
          for the three year period following closing. A total of 100,000 shares
          and  100,000  share purchase warrants were issued. The purchaser is an
          "accredited  investor",  as defined by Rule 501 of Regulation D of the
          Act. No commissions or fees were paid in connection with the offering.
          The  sale  was  completed  pursuant to Rule 506 of Regulation D of the
          Act.  All  securities  issued  were endorsed with a restrictive legend
          confirming  that  the securities cannot be resold without registration
          under  the  Act  or  an  applicable  exemption  from  the registration
          requirements  of  the  Act.

     7.   On  February  27,  2003,  we completed the sale of 720,000 shares at a
          price  of  $0.05  per unit for proceeds of $36,000 to one investor. No
          commissions  or  fees  were  paid in connection with the offering. The
          sale  was  completed  pursuant to Section 4(2) of the Act on the basis
          that the purchaser is a sophisticated purchaser. The purchaser was one
          of our existing shareholders. All securities issued were endorsed with
          a  restrictive  legend confirming that the securities cannot be resold
          without registration under the Act or an applicable exemption from the
          registration  requirements  of  the  Act.

     8.   On  March  2,  2003 we completed a private placement with one non-U.S.
          investor  of 150,000 shares at a price of $0.06 per share for proceeds
          of  $9,000.  No  commissions  or fees were paid in connection with the
          offering. The sales were completed pursuant to Regulation S of the Act
          on the basis that the purchaser is a non-U.S. person, as defined under
          Regulation  S  of  the Act. All securities issued were endorsed with a
          restrictive  legend  confirming  that  the securities cannot be resold
          without registration under the Act or an applicable exemption from the
          registration  requirements  of  the  Act.

     9.   On  March  7,  2003 we completed a private placement with one non-U.S.
          investor  of  33,250  shares at a price of $0.05 per share and 600,000
          shares  at  a price of $0.055 per share for total proceeds of $34,662.
          No  commissions or fees were paid in connection with the offering. The
          sales  were completed pursuant to Regulation S of the Act on the basis
          that the purchaser is a non-U.S. person, as defined under Regulation S
          of  the  Act.  All  securities issued were endorsed with a restrictive
          legend  confirming  that  the  securities  cannot  be  resold  without
          registration  under  the  Act  or  an  applicable  exemption  from the
          registration  requirements  of  the  Act.

     10.  On  March  11, 2003 we completed a private placement with one non-U.S.
          investor  of  100,508  units  at  a  price of $0.10 per unit for total
          proceeds  of  $10,000.  Each unit consists of one common share and one
          common  share  purchase  warrant.  Each  common share purchase warrant
          entitles the warrant holder to purchase one common share at a price of
          $0.24  for  a  three  year  term  from the date of closing. A total of
          100,508  shares  and  100,508  share purchase warrants were issued. No
          commissions  or  fees  were  paid in connection with the offering. The
          sales  were completed pursuant to Regulation S of the Act on the basis
          that the purchaser is a non-U.S. person, as defined under Regulation S
          of  the  Act.  All  securities issued were endorsed with a restrictive
          legend  confirming  that  the  securities  cannot  be  resold  without
          registration  under  the  Act  or  an  applicable  exemption  from the
          registration  requirements  of  the  Act.

     11.  On  March  24,  2003,  we  completed the sale of 1,400,000 shares at a
          price  of  $0.07  per unit for proceeds of $98,000 to one investor. No
          commissions  or  fees  were  paid in connection with the offering. The
          sale  was  completed  pursuant to Section 4(2) of the Act on the basis
          that the purchaser is a sophisticated purchaser. The purchaser was one
          of our existing shareholders. All securities issued were endorsed with
          a  restrictive  legend confirming that the securities cannot be resold
          without registration under the Act or an applicable exemption from the
          registration  requirements  of  the  Act.

As  previously  disclosed  in  our  Annual Report on Form 10-KSB, we concluded a
settlement  agreement  with  Mr.  Nowek  dated effective as of January 29, 2003.
Under  the  terms  of  this settlement agreement, Mr. Nowek agreed to release us
from  any  liability under the employment agreement and the claimed reimbursable
expenses.  In exchange for this release, we issued to Mr. Nowek 35,675 shares of
our  Series X Preferred Stock at a deemed price of $20.00 per share and released
Mr.  Nowek  from  his  $225,000 obligation under the housing loan, for aggregate
consideration  of $938,500.  Each share of Series X Preferred Stock is identical
to


                                       11

<PAGE>


our  common  stock  except that the shares are non-voting and are convertible at
the  option  of  the holder into one hundred shares of our common stock. We also
agreed  with  Mr.  Nowek  to  the  exchange  of 900,000 shares held by a private
company  controlled  by Mr. Nowek into 9,000 shares of Series X Preferred Stock.
The  shares  of  Series  X Preferred Stock were issued pursuant to the exemption
from  the  registration  requirements of the Act provided by Section 4(2) of the
Act.  The  rationale  for incorporating this exchange into the settlement was to
enable  us to provide evidence to the BBX Exchange that none of our officers and
directors at the time of our NASDAQ delisting has any current involvement in our
business and affairs. Mr. Nowek has agreed not to exercise his conversion rights
to  the extent that as a result of such conversion Mr. Nowek would own more than
0.5%  of  our  outstanding  common  stock.

We  had previously been a party to an employment agreement with Mr. Halimi dated
August  1, 1997, as amended January 27, 1998, whereby Mr. Halimi was employed as
our  president and chief executive officer and the president and chief executive
officer  of  Turbodyne  Systems Inc., one of our subsidiaries.  We ceased making
payments to Mr. Halimi as required by the employment agreement in November 2000.
We  concluded  a  settlement  agreement  with  Mr.  Halimi dated effective as of
January  29,  2003.  Under  the  terms  of this settlement agreement, Mr. Halimi
agreed  to  release  us  from  any liability under the employment agreement.  In
exchange for this release, we issued to Mr. Halimi 45,000 shares of our Series X
Preferred  Stock  at  a  deemed  price  of  $20.00  per  share,  for  aggregate
consideration  of $900,000.  Each share of Series X Preferred Stock is identical
to our common stock except that the shares are non-voting and are convertible at
the  option  of the holder into one hundred shares of our common stock.  We also
agreed  with  Mr.  Halimi  to the exchange of 3,250,000 shares held by a private
company controlled by Mr. Halimi into 32,500 shares of Series X Preferred Stock.
In  aggregate,  a total of 77,500 shares of Series X Preferred Stock were issued
to  the  private  company  controlled  by  Mr.  Halimi.  The  shares of Series X
Preferred  Stock  were  issued  pursuant  to the exemption from the registration
requirements  of the Act provided by Section 4(2) of the Act.  The rationale for
incorporating  this  exchange  into  the  settlement was to enable us to provide
evidence to the BBX Exchange that none of our officers and directors at the time
of  our NASDAQ delisting has any current significant involvement in our business
and affairs.  Mr. Halimi has agreed not to exercise his conversion rights to the
extent  that  as a result of such conversion Mr. Halimi would own more than 0.5%
of  our  outstanding  common  stock.

                                       12
<PAGE>

Item  3.     Defaults  upon  Senior  Securities

None.


Item  4.     Submission  of  Matters  to  a  Vote  of  Security  Holders

No  matters  were submitted to our security holders for a vote during the fiscal
quarter  ended  March  31,  2003.


Item  5.     Other  Information

None.

                                       13

<PAGE>


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


EXHIBITS



Exhibit
Number     Description of Exhibit
--------------------------------------------------------------------------------

99.1      Certification  of  Chief  Executive Officer pursuant to pursuant to 18
          U.S.C.  Section  1350,  as  adopted  pursuant  to  Section  906 of the
          Sarbanes-Oxley  Act  of  2002  (1)

99.2      Certification  of  Chief  Financial Officer pursuant to pursuant to 18
          U.S.C.  Section  1350,  as  adopted  pursuant  to  Section  906 of the
          Sarbanes-Oxley  Act  of  2002  (1)
--------------------------------------------------------------------------------
(1)     Filed  as  an  Exhibit  to  this  Quarterly  Report  on  Form  10-QSB
--------------------------------------------------------------------------------


REPORTS  ON  FORM  8-K

We  did not file any Current Reports on Form 8-K during the fiscal quarter ended
March 31, 2003 and we have not filed any Current Reports on Form 8-K since March
31,  2003.



                                       14
<PAGE>




                                   SIGNATURES

In  accordance with the requirements of the Securities and Exchange Act of 1934,
the  Registrant  has  duly  caused this report to be signed on its behalf by the
undersigned,  thereunto  duly  authorised.


Date:     May  28,  2003


TURBODYNE  TECHNOLOGIES  INC.


By:  /s/ Daniel  Black
     ___________________________________
     Daniel  Black,  President  and  Chief  Executive  Officer
     (Principal  Executive  Officer)
     Date:     May  28,  2003


By:  /s/ Charles  Caverno
     ___________________________________
     Charles  Caverno,  Secretary  and  Chief  Financial  Officer
     (Principal  Financial  Officer  and  Principal  Accounting  Officer)
     Date:     May  28,  2003


<PAGE>


                                 CERTIFICATIONS

I,  DANIEL  BLACK,  Chief Executive Officer of Turbodyne Technologies, Inc. (the
"Registrant"),  certify  that;

1.   I  have  reviewed  this  quarterly  report  on  Form10-QSB  of  Turbodyne
     Technologies,  Inc.;

2.   Based  on  my  knowledge, this quarterly report does not contain any untrue
     statement  of a material fact or omit to state a material fact necessary to
     make  the  statements  made, in light of the circumstances under which such
     statements  were made, not misleading with respect to the period covered by
     this  quarterly  report;

3.   Based  on  my  knowledge,  the  financial  statements,  and other financial
     information  included  in  this  quarterly  report,  fairly  present in all
     material  respects  the financial condition, results of operations and cash
     flows  of  the  registrant  as  of,  and for, the periods presented in this
     quarterly  report.

4.   The  registrant's  other  certifying  officers  and  I  are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in  Exchange  Act  Rules  13a-14  and  15d-14) for the registrant and have:

     a)   designed  such  disclosure  controls  and  procedures  to  ensure that
          material  information  relating  to  the  registrant,  including  its
          consolidated  subsidiaries, is made known to us by others within those
          entities,  particularly  during  the  period  in  which this quarterly
          report  is  being  prepared;

     b)   evaluated  the  effectiveness  of the registrant's disclosure controls
          and procedures as of a date within 90 days prior to the filing date of
          this  quarterly  report  (the  "Evaluation  Date");  and

     c)   presented  in  this  quarterly  report  our  conclusions  about  the
          effectiveness  of  the disclosure controls and procedures based on our
          evaluation  as  of  the  Evaluation  Date;

5.   The  registrant's  other certifying officers and I have disclosed, based on
     our  most  recent  evaluation,  to  the registrant's auditors and the audit
     committee  of  registrant's  board  of directors (or persons performing the
     equivalent  functions):

     a)   all  significant  deficiencies  in the design or operation of internal
          controls  which  could  adversely  affect  the registrant's ability to
          record,  process,  summarize  and  report  financial  data  and  have
          identified  for  the  registrant's auditors any material weaknesses in
          internal  controls;  and

     b)   any  fraud, whether or not material, that involves management or other
          employees  who  have  a  significant role in the registrant's internal
          controls;  and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly  report whether or not there were significant changes in internal
     controls  or  in  other  facts  that  could  significantly  affect internal
     controls  subsequent  to  the date of our most recent evaluation, including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.


Date:   May  28,  2003       /s/ DANIEL  BLACK
                             ___________________________________
                                   (Signature)

                                   President  and  Chief  Executive  Officer
                             ___________________________________
                                   (Title)

<PAGE>



                                 CERTIFICATIONS

I, CHARLES CAVERNO, Chief Financial Officer of Turbodyne Technologies, Inc. (the
"Registrant"),  certify  that;

1.   I  have  reviewed  this  quarterly  report  on  Form10-QSB  of  Turbodyne
     Technologies,  Inc.;

2.   Based  on  my  knowledge, this quarterly report does not contain any untrue
     statement  of a material fact or omit to state a material fact necessary to
     make  the  statements  made, in light of the circumstances under which such
     statements  were made, not misleading with respect to the period covered by
     this  quarterly  report;

3.   Based  on  my  knowledge,  the  financial  statements,  and other financial
     information  included  in  this  quarterly  report,  fairly  present in all
     material  respects  the financial condition, results of operations and cash
     flows  of  the  registrant  as  of,  and for, the periods presented in this
     quarterly  report.

4.   The  registrant's  other  certifying  officers  and  I  are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in  Exchange  Act  Rules  13a-14  and  15d-14) for the registrant and have:

     a)   designed  such  disclosure  controls  and  procedures  to  ensure that
          material  information  relating  to  the  registrant,  including  its
          consolidated  subsidiaries, is made known to us by others within those
          entities,  particularly  during  the  period  in  which this quarterly
          report  is  being  prepared;

     b)   evaluated  the  effectiveness  of the registrant's disclosure controls
          and procedures as of a date within 90 days prior to the filing date of
          this  quarterly  report  (the  "Evaluation  Date");  and

     c)   presented  in  this  quarterly  report  our  conclusions  about  the
          effectiveness  of  the disclosure controls and procedures based on our
          evaluation  as  of  the  Evaluation  Date;

5.   The  registrant's  other certifying officers and I have disclosed, based on
     our  most  recent  evaluation,  to  the registrant's auditors and the audit
     committee  of  registrant's  board  of directors (or persons performing the
     equivalent  functions):

     a)   all  significant  deficiencies  in the design or operation of internal
          controls  which  could  adversely  affect  the registrant's ability to
          record,  process,  summarize  and  report  financial  data  and  have
          identified  for  the  registrant's auditors any material weaknesses in
          internal  controls;  and

     b)   any  fraud, whether or not material, that involves management or other
          employees  who  have  a  significant role in the registrant's internal
          controls;  and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly  report whether or not there were significant changes in internal
     controls  or  in  other  facts  that  could  significantly  affect internal
     controls  subsequent  to  the date of our most recent evaluation, including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.


Date:   May  28,  2003      /s/ CHARLES CAVERNO
                            ___________________________________
                                   (Signature)

                                   Chief  Financial  Officer
                            ___________________________________
                                   (Title)