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


                                    FORM 10-Q


                  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934


                For the quarterly period ended September 30, 1999

                          Commission File No. 000-21375


                        ONTRACK DATA INTERNATIONAL, INC.
           (Exact name of business issuer as specified in its charter)


                MINNESOTA                                 41-1521650
    (State or other jurisdiction of            (IRS Employer Identification No.)
     incorporation or organization)

          9023 COLUMBINE ROAD,                              55347
         EDEN PRAIRIE, MINNESOTA                          (Zip Code)
(Address of principal executive office)

             www.ontrack.com                            (612) 937-1107
              (Web address)                        (Issuer's telephone number)


Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.

                              Yes _X_         No ___

As of October 31, 1999, the Company had 9,959,944 shares of Common Stock, $.01
par value, outstanding.

<PAGE>


                        ONTRACK DATA INTERNATIONAL, INC.

                                      INDEX



PART 1.     FINANCIAL INFORMATION                                           PAGE
                                                                            ----
       ITEM 1.    CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                  (UNAUDITED):

                  Condensed Consolidated Balance Sheets as of
                  September 30, 1999 and December 31, 1998                  3

                  Condensed Consolidated Statements of Income for the
                  three and nine months ended September 30, 1999
                  and 1998                                                  4

                  Condensed Consolidated Statements of Cash Flows
                  for the nine months ended September 30, 1999
                  and 1998                                                  5

                  Notes to Condensed Consolidated Financial Statements      6

       ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                  CONDITION AND RESULTS OF OPERATIONS                       7-10

       ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET
                  RISK                                                      10

PART II.    OTHER INFORMATION

       ITEM 6.    EXHIBITS AND REPORTS ON FORM 8-K                          11


SIGNATURES                                                                  12


                                        2
<PAGE>


PART 1. FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


                        ONTRACK DATA INTERNATIONAL, INC.
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                      (IN THOUSANDS, EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                               SEPTEMBER 30     DECEMBER 31
                                                                   1999            1998
                                                               ------------    ------------
ASSETS                                                         (Unaudited)
<S>                                                            <C>             <C>
CURRENT ASSETS:
 Cash and cash equivalents                                     $     11,733    $     14,724
 Marketable securities                                               15,402          18,872
 Accounts receivable, net                                             5,753           3,759
 Deferred income taxes and other assets                               2,301           2,228
                                                               ------------    ------------

   Total current assets                                              35,189          39,583

 Long-term marketable securities                                      3,502             716
 Furniture and equipment, net                                         6,232           4,019
 Capitalized software, net                                            1,373           2,131
 Goodwill, net                                                        6,906              --
                                                               ------------    ------------

   TOTAL ASSETS                                                      53,202          46,449
                                                               ============    ============

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES                                            $      5,708    $      3,669

SHAREHOLDERS' EQUITY:

 Common stock (9,959,944 and 9,697,234 shares issued and
   outstanding at September 30, 1999 and December 31, 1998,
   respectively)                                                        100              97

 Additional paid-in capital                                          30,295          29,131

 Accumulated other comprehensive income                                   4              22

 Retained earnings                                                   17,095          13,530
                                                               ------------    ------------

   Total shareholders' equity                                        47,494          42,780
                                                               ------------    ------------

   TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                  $     53,202    $     46,449
                                                               ============    ============
</TABLE>


                 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

                                        3
<PAGE>


                        ONTRACK DATA INTERNATIONAL, INC.
                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
               (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                THREE MONTHS                    NINE MONTHS
                                             ENDED SEPTEMBER 30              ENDED SEPTEMBER 30
                                        ----------------------------    ----------------------------
                                            1999           1998             1999           1998
                                        ------------    ------------    ------------    ------------
<S>                                     <C>             <C>             <C>             <C>
REVENUES:
 Data recovery services and products    $      9,522    $      7,601    $     24,480    $     22,041
 Software                                      2,525           1,470           5,042           5,003
                                        ------------    ------------    ------------    ------------
   TOTAL REVENUES                             12,047           9,071          29,522          27,044

COST OF REVENUES:
 Data recovery services and products           2,319           1,626           6,264           4,380
 Software                                        515             304             939             905
                                        ------------    ------------    ------------    ------------
   TOTAL COST OF REVENUES                      2,834           1,930           7,203           5,285
                                        ------------    ------------    ------------    ------------

Gross margin                                   9,213           7,141          22,319          21,759

OPERATING EXPENSES:
 Research and development                      1,994           1,738           4,914           5,000
 Sales and marketing                           2,721           2,282           7,135           6,424
 General and administrative                    2,037           1,775           5,398           5,152
 Amortization of goodwill                        357              --             357              --
                                        ------------    ------------    ------------    ------------
   TOTAL OPERATING EXPENSES                    7,109           5,795          17,804          16,576
                                        ------------    ------------    ------------    ------------

OPERATING INCOME                               2,104           1,346           4,515           5,183

INTEREST AND OTHER INCOME                        303             569             823           1,220
                                        ------------    ------------    ------------    ------------

INCOME BEFORE INCOME TAXES                     2,407           1,915           5,338           6,403

PROVISION FOR INCOME TAXES                       819             613           1,773           2,049
                                        ------------    ------------    ------------    ------------

NET INCOME                              $      1,588    $      1,302    $      3,565    $      4,354
                                        ============    ============    ============    ============


BASIC NET INCOME PER SHARE              $       0.16    $       0.13    $       0.36    $       0.44

DILUTED NET INCOME PER SHARE            $       0.16    $       0.13    $       0.36    $       0.43


WEIGHTED AVERAGE SHARES
 USED IN COMPUTATION OF:

 BASIC NET INCOME PER SHARE                9,911,467       9,894,394       9,774,353       9,919,335

 DILUTED NET INCOME PER SHARE              9,965,732      10,006,938       9,810,036      10,072,004
</TABLE>


                 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

                                       4
<PAGE>


                        ONTRACK DATA INTERNATIONAL, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                 NINE MONTHS
                                                              ENDED SEPTEMBER 30
                                                         -----------------------------
                                                             1999             1998
                                                         ------------     ------------
<S>                                                      <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 NET INCOME                                              $      3,565     $      4,354

 ADJUSTMENTS TO RECONCILE NET INCOME TO NET
   CASH PROVIDED BY OPERATING ACTIVITIES:
     Depreciation                                               1,512            1,671
     Amortization of capitalized software                         758               --
     Amortization of goodwill                                     357               --
     Changes in operating assets and liabilities:
       Accounts receivable                                     (1,994)            (134)
       Other current assets                                       228             (166)
       Accounts payable and accrued expenses                     (387)          (3,371)
                                                         ------------     ------------

NET CASH PROVIDED BY OPERATING ACTIVITIES                       4,039            2,354


CASH FLOWS FROM INVESTING ACTIVITIES:
 Acquisition of Mijenix Corporation                            (6,564)              --
 Purchase of furniture and equipment                           (1,317)          (1,886)
 Net increase of short-term and long-term
   marketable securities                                          684            2,773
                                                         ------------     ------------

NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES            (7,197)             887


CASH FLOWS FROM FINANCING ACTIVITIES:
 Repurchase of common stock                                        --           (2,232)
 Proceeds from exercise of stock options and employee
   stock purchase plan                                            167              433
                                                         ------------     ------------

NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES               167           (1,799)
                                                         ------------     ------------

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS           (2,991)           1,442

Cash and cash equivalents, beginning of period                 14,724           17,315
                                                         ------------     ------------

CASH AND CASH EQUIVALENTS, END OF PERIOD                 $     11,733     $     18,757
                                                         ============     ============
</TABLE>


                SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

                                        5
<PAGE>


                        ONTRACK DATA INTERNATIONAL, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.       ORGANIZATION

         ONTRACK Data International, Inc. (the "Company") provides data recovery
         services and products, utility software and other computer data related
         services. The Company's headquarters are in Minneapolis, Minnesota, and
         it has locations in Los Angeles, California; Washington, D.C.; New
         York, New York; Boulder, Colorado; London, England; Stuttgart, Germany
         and Paris, France.

2.       SIGNIFICANT ACCOUNTING POLICIES

         BASIS OF PRESENTATION

         The accompanying unaudited condensed consolidated financial statements
         have been prepared pursuant to the rules and regulations of the
         Securities and Exchange Commission. Certain information and footnote
         disclosures normally included in annual financial statements prepared
         in accordance with generally accepted accounting principles have been
         condensed or omitted as permitted by such rules and regulations. These
         financial statements and related notes should be read in conjunction
         with the financial statements and notes thereto included in the
         Company's audited consolidated financial statements for the year ended
         December 31, 1998 contained in the Company's Annual Report on Form 10-K
         for 1998.

         In the opinion of management, the interim financial statements reflect
         adjustments, consisting of normal recurring accruals, which are
         necessary to present fairly the Company's financial position, results
         of operations and cash flow for the periods indicated. The results of
         operations for the third quarter and nine months ended September 30,
         1999 are not necessarily indicative of the results to be expected for
         the full year.

         NET INCOME PER SHARE

         Basic net income per share includes no dilution and is computed by
         dividing net income available to common stockholders by the weighted
         average number of common shares outstanding for the period. Diluted net
         income per share reflects the potential dilution of securities that
         could share in the earnings of the Company. The difference between the
         Company's basic and diluted net income per share data as presented is
         due to the dilutive impact from stock options whose exercise price was
         below the average common stock price for the respective period
         presented.

         COMPREHENSIVE INCOME

         The components of comprehensive income for the third quarter and nine
         months ended September 30, 1999 and 1998 are foreign currency
         translation adjustments. Comprehensive income is not separately
         reported, as amounts were not significant.


                                        6
<PAGE>


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS


COMPARISON OF THIRD QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998

REVENUES

DATA RECOVERY SERVICES AND PRODUCTS:

Data recovery services and products revenues for the third quarter of 1999
increased 25% compared to the third quarter of 1998. For the nine months ended
September 30, 1999, data recovery services and products revenues increased 11%.
Data recovery services and products revenues consist of the following:


                                        Three Months           Nine Months
                                     Ended September 30    Ended September 30
                                    -------------------   -------------------
                                      1999       1998       1999       1998
                                    --------   --------   --------   --------

Data recovery lab services          $  7,014   $  7,120   $ 18,993   $ 20,394
Remote data recovery services            355        251      1,305        551
Data recovery products                   564         --      1,747         --
Information management services        1,589        230      2,435      1,096
                                    --------   --------   --------   --------
     Total data recovery services
     and products revenues          $  9,522   $  7,601   $ 24,480   $ 22,041
                                    ========   ========   ========   ========


The increases in revenues from remote data recovery services and data recovery
products are a result of the Company's efforts to leverage its data recovery
technology into new revenue generating products and services. Information
management revenues increased dramatically in the third quarter in part due to a
large project, which contributed approximately $1.1 million in revenue during
the quarter. This project will continue to generate revenue in the fourth
quarter of 1999. The remaining increase in information management revenue is a
result of increased project opportunities.

SOFTWARE:

Software revenues for the third quarter of 1999 increased 72% compared to the
third quarter of 1998. The increase is due entirely to sales of products of the
Company's newly acquired wholly-owned subsidiary headquartered in Boulder,
Colorado, Mijenix Corporation ("Boulder division"). These products contributed
approximately $1.2 million in revenue during the quarter. For the nine months
ended September 30, 1999, software revenues increased 1% compared to the first
nine months of 1998. The increase is a net result of the new revenues the
Boulder division generated combined with a decline in the sales of Disk Manager.
While Disk Manager continues to contribute strong operating margins, downward
pricing pressure continues from the Company's main customers.


                                        7
<PAGE>


GROSS MARGINS

DATA RECOVERY SERVICES AND PRODUCTS:

Gross margins on data recovery services and products revenues for the third
quarter and nine months ended September 30, 1999 were 76% and 74%, respectively,
compared to 79% and 80% for the comparable periods of 1998. The decreases are
due primarily to the amortization of capitalized software related to the
TIRAMISU(TM) product line and, to a lesser degree, higher data recovery
engineering labor costs.

SOFTWARE:

Gross margins on software revenues for the third quarter and nine months ended
September 30, 1999 were 80% and 81%, respectively, and were approximately the
same as the comparable periods of 1998. As revenues from the Boulder division
products make up a larger portion of software revenues, software gross margins
are expected to decline to the range of 70% to 75%.

OPERATING EXPENSES

RESEARCH AND DEVELOPMENT:

Research and development expenses for the third quarter of 1999 increased 15%
compared to the third quarter of 1998 and decreased 2% in the first nine months
of 1999 compared to the same period of 1998. As a percentage of revenues,
research and development expenses were 17% for both the third quarter and nine
months ended September 30, 1999, compared to 19% for the comparable periods of
1998. The third quarter increase is due primarily to research and development
expenditures incurred by the Boulder division as they prepare new products for
launch.

SALES AND MARKETING:

Sales and marketing expenses for the third quarter of 1999 increased 19%
compared to the third quarter of 1998 and increased 11% in the first nine months
of 1999 compared to the same period of 1998. The increases are due principally
to the activities of the Boulder division. As a percentage of revenues, sales
and marketing expenses were 23% and 24% for the third quarter and nine months
ended September 30, 1999, respectively, compared to 25% and 24% for the
comparable periods of 1998. The decline in third quarter percentage is due to
the increase in consolidated revenues.

GENERAL AND ADMINISTRATIVE:

General and administrative expenses for the third quarter of 1999 increased 15%
compared to the third quarter of 1998 and increased 5% in the first nine months
of 1999 compared to the same period of 1998. The increases are due mainly to the
expenses of the Boulder division. As a percentage of revenues, general and
administrative expenses were 17% and 18% for the third quarter and nine months
ended September 30, 1999, respectively, compared to 20% and 19% for the
comparable periods of 1998. The decreased percentage is due to increased
revenues, as general and administrative expenses do not fluctuate directly with
revenues.


                                        8
<PAGE>


GOODWILL

Effective July 15, 1999 the Company completed the acquisition of the Boulder
division. The purchase price consisted of $6 million in cash and 215,345 shares
of Ontrack common stock. The acquisition is being accounted for as a purchase
and accordingly, goodwill of $7.3 million was recorded. The terms of the
purchase contain an earn-out whereby the former shareholders of the Boulder
division can receive up to $2.5 million of additional consideration if certain
financial goals are met during the period July 16, 1999 to December 31, 1999.

Goodwill is being amortized over a period of 60 months. Any amounts paid
pursuant to the earn-out will be added to the purchase price and amortized over
the remainder of the 60-month period. See the Company's Report on Form 8-K filed
July 27, 1999 for more information.

INTEREST AND OTHER INCOME

The decrease in interest and other income for the third quarter and nine months
ended September 30, 1999 is due principally to exchange differences resulting
from currency fluctuations in the value of the Euro against the US dollar.

PROVISION FOR INCOME TAXES

For the third quarter and nine months ended September 30, 1999, the Company
provided for taxes at effective rates of 34% and 33%, respectively. The
effective rate is lower than the statutory rate because of the impact of
tax-exempt interest income earned on investments and research and development
credits.

NET INCOME PER SHARE

The changes in basic and diluted net income per share for the third quarter and
nine months ended September 30, 1999 and 1998 are due to changes in net income.

LIQUIDITY AND CAPITAL RESOURCES

Net cash flow from operations was $4.0 million and $2.4 million for the nine
months ended September 30, 1999 and 1998, respectively. Cash used in investment
activities was primarily for the Mijenix acquisition discussed above, and for
the purchases of furniture and equipment.

The Company has invested its cash principally in high-grade taxable and tax
exempt government securities. As of September 30, 1999, $3.5 million is
classified as long-term, with the remaining amount classified as cash and cash
equivalents or short-term marketable securities.

YEAR 2000 COMPLIANCE

The "Year 2000" problem concerns the inability of existing information systems
to properly recognize and process date-sensitive information beyond January 1,
2000. If not corrected, these systems could fail or create erroneous
information. The Company has undertaken various initiatives to evaluate and
respond to the potential impact of the Year 2000 issue on its computer and other
operating systems. A Year 2000 committee has formulated a plan to address the
Year 2000 issue. Under this plan, Company personnel have identified business
systems that are critical to the


                                        9
<PAGE>


Company's business operations that require testing. The Company has completed
testing and remediation of its software products, the software and hardware used
in product development, its internal systems, non-information technology
systems, the hardware and software tools it uses in its data recovery business
and the systems in its satellite offices. The Company has completed this testing
and remediation except for certain systems that are being updated for reasons
other than Year 2000 compliance. These systems are expected to be tested and
remediated by December 31, 1999.

The Company is also communicating and working with its significant vendors,
customers and other business partners to minimize Year 2000 risks and protect
the Company and its customers from potential service interruptions. However, the
Company could be adversely affected by the failure of third parties to become
Year 2000 compliant, including the risk of operational outages due to
disruptions in communications or electrical service. Although the Company
believes the effect of such disruptions would be localized and temporary, there
is no assurance that these or other Year 2000 risks will not have a material
financial impact in any future period.

After assessing the information received from vendors, customers and other
business partners, and evaluating the completion of its Year 2000 project, the
Company believes all systems will be compliant and does not anticipate any
problems due to the date change. In the event that a system should fail, plans
have been developed to allow daily operations to continue.

The Company believes that its expenses for the Year 2000 compliance through
September 30, 1999 are not material, and total expenses for compliance are not
expected to exceed $100,000.

FORWARD-LOOKING STATEMENTS

This Form 10-Q contains forward-looking statements within the meaning of federal
securities laws made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. These statements include statements
regarding intent, belief, or current expectations of the Company and its
management. These forward-looking statements are not guarantees of the future
performance and involve a number of risks and uncertainties that may cause the
Company's actual results to differ materially from the results discussed in
these statements. Please refer to the Management's Discussion and Analysis
section of the Company's Annual Report on Form 10-K for the year ended December
31, 1998, for cautionary statements on important factors to consider in
evaluating the forward-looking statements included in this Form 10-Q.


ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

There has been no material change in the Company's exposure to market risk since
December 31, 1998. Please refer to the Management's Discussion and Analysis
section of the Company's Annual Report on Form 10-K for the year ended December
31, 1998, for more information.


                                       10
<PAGE>


                        ONTRACK DATA INTERNATIONAL, INC.


PART II.  OTHER INFORMATION

          ITEM 6.       EXHIBITS AND REPORTS ON FORM 8-K

                (a).    Exhibit 27.1, Financial Data Schedule

                (b).    Reports on Form 8-K.

                        Form 8-K was filed on July 27, 1999 relating to the
                        acquisition of Mijenix Corporation.


                                       11
<PAGE>


                        ONTRACK DATA INTERNATIONAL, INC.

                                   SIGNATURES



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



                                   ONTRACK DATA INTERNATIONAL, INC.
                                   --------------------------------
                                             (Registrant)




Date:  November 12, 1999                By:  /s/ Michael W. Rogers
                                        ----------------------------------------
                                        Michael W. Rogers
                                        Chairman and Chief Executive Officer



Date:  November 12, 1999                By:  /s/ Thomas P. Skiba
                                        ----------------------------------------
                                        Thomas P. Skiba
                                        Vice President & Chief Financial Officer


                                       12