UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-Q
(Mark One)

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

For the quarterly period ended               December 31, 2000
                               -------------------------------------------------
                                       or
[    ]   TRANSITION  REPORT  PURSUANT  TO SECTION 13 or 15(d) OF THE  SECURITIES
EXCHANGE ACT OF 1934

For the transition period from                       to
                               ---------------------    ------------------------

Commission File Number:                        001-8988
                        --------------------------------------------------------

                             ECC International Corp.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

                Delaware                               23-1714658
--------------------------------------------------------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)

2001 West Oak Ridge Road, Orlando, FL                        32809-3803
--------------------------------------------------------------------------------
(Address of principal executive offices)                     (Zip Code)

                                 (407) 859-7410
--------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)

                                 Not Applicable
--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed since last report)

            Indicate  by check mark  whether  the  Registrant  (1) has filed all
reports  required to be filed by Section 13 or 15(d) of the Securities  Exchange
Act of 1934 during the preceding  twelve 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.
                                                        [ X ] Yes     [     ] No

            As  of  January  31,  2001  there  were  8,545,705   shares  of  the
Registrant's Common Stock, $.10 par value per share, issued and outstanding.

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

--------------------------------------------------------------------------------
<PAGE>

                          PART I. FINANCIAL STATEMENTS
                          ITEM 1. FINANCIAL STATEMENTS
                    ECC INTERNATIONAL CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                   SIX MONTHS ENDED DECEMBER 31, 2000 AND 1999
                      (In Thousands Except Per Share Data)
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                   Six Months       Six Months
                                                      Ended            Ended
                                                    12/31/00         12/31/99
                                                    --------         --------

<S>                                                 <C>               <C>
Sales                                               $ 15,019          $ 21,246

Cost of Sales                                         12,466            14,615
                                                    --------          --------
Gross Profit                                           2,553             6,631
                                                    --------          --------
Expenses:
   Selling, General & Administrative                   4,311             4,342
   Independent Research and Development                  232               150
                                                    --------          --------
      Total Expenses                                   4,543             4,492
                                                    --------          --------
Operating (Loss)/Income                               (1,990)            2,139
                                                    ---------         --------
Other Income/(Expense):
   Interest Income                                        57                24
   Interest Expense                                     (105)             (440)
   Other - Net                                           147               (92)
                                                    --------          --------
      Total Other Income/(Expense)                        99              (508)
                                                    --------          --------
(Loss)/Income Before Income Taxes                     (1,891)            1,631

Provision for Income Taxes                               120                 -
                                                    ---------         --------
Net (Loss)/Income                                   $ (2,011)         $  1,631
                                                    =========         ========
(Loss)/Income Per Common Share -
   Basic and Assuming Dilution:

Net (Loss)/Income Per Common Share-Basic             $ (0.24)         $   0.19
                                                     ========         ========
Net (Loss)/Income Per Common Share-Dilutive          $ (0.24)         $   0.19
                                                     ========         ========
</TABLE>

        See accompanying notes to the consolidated financial statements.

                                                                               2

<PAGE>

                    ECC INTERNATIONAL CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                  THREE MONTHS ENDED DECEMBER 31, 2000 AND 1999
                      (In Thousands Except Per Share Data)
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                Three Months     Three Months
                                                    Ended            Ended
                                                  12/31/00          12/31/99
                                                  --------          --------

<S>                                                 <C>              <C>
Sales                                               $ 7,548          $ 11,058

Cost of Sales                                         7,154             7,390
                                                    -------          --------

Gross Profit                                            394             3,668
                                                    -------          --------

Expenses:
   Selling, General & Administrative                  2,112             2,318
   Independent Research and Development                 162               109
                                                    -------          --------
      Total Expenses                                  2,274             2,427
                                                    -------          --------

Operating (Loss)/Income                              (1,880)            1,241
                                                    --------         --------

Other Income/(Expense):
   Interest Income                                       20                12
   Interest Expense                                     (61)             (231)
   Other - Net                                           21                36
                                                    -------          --------

      Total Other Expense                               (20)             (183)
                                                    --------         ---------

(Loss)/Income Before Income Taxes                    (1,900)            1,058

Provision for Income Taxes                              120                 -
                                                   --------          --------

Net (Loss)/Income                                  $ (2,020)         $  1,058
                                                   =========         ========

(Loss)/Income Per Common Share -
   Basic and Assuming Dilution:

Net (Loss)/Income Per Common Share-Basic           $  (0.25)          $  0.13
                                                   =========          =======

Net (Loss)/Income Per Common Share-Dilutive        $  (0.25)          $  0.12
                                                   =========          =======
</TABLE>


          See accompanying notes the consolidated financial statements.

                                                                               3

<PAGE>


                    ECC INTERNATIONAL CORP. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                 (In Thousands)
<TABLE>
<CAPTION>

                                                  (Unaudited)        (Audited)
                                                   12/31/00           6/30/00
                                                   --------           -------
ASSETS

Current Assets:
<S>                                              <C>                <C>
   Cash                                          $      -           $    2,406
   Accounts Receivable                              3,975                7,359
   Costs and Estimated Earnings in Excess
      of Billings on Uncompleted Contracts         12,833               10,455
   Inventories                                      3,094                2,559
   Prepaid Expenses and Other                         601                  449
                                                 --------           ----------
      Total Current Assets                         20,503               23,228
                                                 --------           ----------
Property, Plant and Equipment - Net                14,240               15,476

Other Assets                                          350                  531
                                                 --------           ----------
      Total Assets                               $ 35,093           $   39,235
                                                 ========           ==========
</TABLE>









                                                                    Continued...


                                                                               4
<PAGE>

                    ECC INTERNATIONAL CORP. AND SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEETS (Continued)
                 (In Thousands Except Share and Per Share Data)
<TABLE>
<CAPTION>

                                                       (Unaudited)     (Audited)
                                                         12/31/00       6/30/00
                                                         --------       -------
LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities:
<S>                                                    <C>             <C>
   Current Portion of Long-Term Debt                   $  1,462        $     --
   Accounts Payable                                       1,849           1,438
   Accrued Expenses and Other                             2,749           3,869
                                                       --------        --------
      Total Current Liabilities                           6,060           5,307

Deferred Income Taxes                                        80              80
Other Long-Term Liabilities                                  85             159
                                                       --------        --------

      Total Liabilities                                   6,225           5,546
                                                       --------        --------

COMMITMENTS AND CONTINGENCIES

Stockholders' Equity:
   Preferred Stock, $.10 par; 1,000,000 shares
      authorized; none issued and outstanding                --              --
   Common Stock, $.10 par; 20,000,000
     shares authorized; issued and outstanding,
     8,545,705 and 8,481,067                                854             848
   Note Receivable from Stockholder                        (146)           (146)
   Capital in Excess of Par                              25,389          25,211
   Retained Earnings                                      5,680           7,776
   Treasury Stock, at cost (727,000 shares)              (2,909)             --
                                                       --------        --------
      Total Stockholders' Equity                         28,868          33,689
                                                       --------        --------

      Total Liabilities & Stockholders' Equity         $ 35,093        $ 39,235
                                                       ========        ========
</TABLE>


        See accompanying notes to the consolidated financial statements.

                                                                               5
<PAGE>


                    ECC INTERNATIONAL CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                   SIX MONTHS ENDED DECEMBER 31, 2000 AND 1999
                                 (In Thousands)
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                        Six Months    Six Months
                                                          Ended        Ended
                                                         12/31/00     12/31/99
                                                         --------     --------
Cash Flows From Operating Activities:
<S>                                                      <C>          <C>
Net Income                                               $(2,011)     $  1,631
Items Not Requiring Cash:
   Depreciation                                            1,411         1,994
   Amortization                                               38           171
   (Gain)/Loss on Disposal of Equipment                     (137)            5
Changes in Certain Assets and Liabilities:
   Accounts Receivable                                     3,384            37
   Costs and Estimated Earnings in Excess
      of Billings on Uncompleted Contracts                (2,378)        1,598
   Inventories                                              (535)          165
   Prepaid Expenses and Other                                 (9)          (18)
   Accounts Payable                                          411        (1,704)
   Accrued Expenses and Other Long-Term Liabilities       (1,186)       (2,407)
                                                         -------      --------
Net Cash (Used In)/Provided By Operating Activities       (1,012)        1,472
                                                         -------      --------
Cash Flows From Investing Activities:
   Proceeds from Sales of Assets                             148            --
   Additions to Property, Plant and Equipment               (186)         (792)
                                                         -------      --------
Net Cash Used In Investing Activities                        (38)         (792)
                                                         -------      --------
Cash Flows From Financing Activities:
   Proceeds From Issuance of Common Stock and
      Options Exercised                                      176            67
   Purchase of Treasury Stock                             (2,909)           --
   Dividends Paid                                            (85)           --
   Debt Issue Cost for Revolving Credit Facility              --           (87)
   Borrowings Under Revolving Credit Facility              1,955        21,585
   Repayments Under Revolving Credit Facility               (493)      (23,730)
                                                         -------      --------
Net Cash Used In Financing Activities                     (1,356)       (2,165)
                                                         -------      --------
Net Decrease in Cash                                      (2,406)       (1,485)

Cash at Beginning of the Period                            2,406         1,485
                                                         -------      --------
Cash at End of the Period                                $    --      $     --
                                                         =======      ========

</TABLE>

                                                                  Continuted....


                                                                               6

<PAGE>

                    ECC INTERNATIONAL CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
             SIX MONTHS ENDED DECEMBER 31, 2000 AND 1999 (Continued)
                                 (In Thousands)
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                  Six Months    Six Months
                                                                    Ended         Ended
                                                                   12/31/00      12/31/99
                                                                   --------      --------
Supplemental Disclosure of Cash Flow Information:
Cash Paid During the Year For:
<S>                                                                <C>             <C>
   Interest                                                        $      99       $ 377

Supplemental Schedule of Non Cash Financing Activities:
   Issuance of Director Equity Compensation                        $       8       $  52
   Purchase of Fixed Assets Through Capital Leases                 $       -       $ 254
</TABLE>




            See accompanying notes to the consolidated financial statements.

                                                                               7
<PAGE>


                    ECC INTERNATIONAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.       The accompanying  consolidated  financial  statements are unaudited and
         have been prepared by ECC International  Corp. (the "Company") pursuant
         to the rules and regulations of the Securities and Exchange Commission.
         The June 30, 2000  consolidated  balance sheet was derived from audited
         consolidated  financial statements but does not include all disclosures
         required by generally accepted accounting principles. In the opinion of
         management,   the   accompanying   unaudited   consolidated   financial
         statements contain all adjustments, consisting of only normal recurring
         adjustments,  necessary to present  fairly the  consolidated  financial
         position,  results of operations,  comprehensive  income and cash flows
         for the  interim  presented.  These  unaudited  consolidated  financial
         statements   should  be  read  in  conjunction  with  the  consolidated
         financial  statements  and footnotes  thereto in the  Company's  Annual
         Report on Form 10-K for the fiscal year ended June 30, 2000.

         The Company has no other Comprehensive Income other than Net Income.

2.       Inventories

                                        12/31/00      6/30/00
                                        --------      -------
                                             (In Thousands)

               Work in Process           $   686      $    89
               Raw Materials               4,633        4,635
                                         -------      -------
               Total Gross Value           5,319        4,724
               Reserves                   (2,225)      (2,165)
                                         -------      -------
               Net Value                 $ 3,094      $ 2,559
                                         =======      =======

         Work in process  inventory is valued using the specific  identification
         cost method,  but not in excess of net realizable  value. Raw materials
         are valued at the lower of average cost or market. Reserve balances are
         provided for excess and obsolete inventories.

3.          Debt

         On June 24, 1999, the Company entered into a revolving  Credit Facility
         ("Credit  Facility") with Mellon Bank, N.A.  totaling $12.5 million and
         expiring on June 24, 2003.  Available borrowings are based on a formula
         of  accounts  receivables  and  property,  as  defined  in  the  Credit
         Facility, and were approximately $5.8 million at December 31, 2000. The
         outstanding  balance under the Credit  Facility as of December 31, 2000
         was approximately $1.5 million.

         The Credit Facility includes a subjective  acceleration  clause as well
         as a lockbox  requirement under the control of the lender,  whereby all
         collections of trade  receivables  are used to  immediately  reduce any
         outstanding balance under the Credit Facility.

         For the periods ended  December 31, 2000,  and September 30, 2000,  the
         Company was not in compliance with certain financial covenants required
         under the Credit  Facility.  The  Company

                                                                               8

<PAGE>

         resolved the first quarter  non-compliance  issue by obtaining a waiver
         for the  financial  defaults  from  Mellon  Bank,  N.A.  The Company is
         currently  negotiating  with  Mellon  Bank,  N.A.  to amend the  Credit
         Facility and the December 31, 2000 covenants and  anticipates  that any
         such  amendment  will result in a revision to the  financial  covenants
         such that the Company will be in compliance with such revised financial
         covenants.  However, there can be no assurance that the Company will be
         successful in negotiating revised covenants under the Credit Facility.

4.       Income Taxes

         During the second quarter of fiscal year 2001,  the Company  recorded a
         tax  provision  of  $120,000.  This  provision  was  recorded  due to a
         valuation  allowance  for an  alternative  minimum tax credit  which is
         necessary due to the uncertainty as to the ultimate  realization of the
         tax credit. In addition,  the Company has approximately $5.4 million of
         cumulative  federal net operating loss  carryforwards,  which expire in
         2013 and 2018.  This  amount is prior to any  potential  net  operating
         losses generated in the current year.

5.       Unusual Expenses

         During fiscal year 1999, the Company implemented various cost reduction
         initiatives  and changes in management  including the relocation of the
         corporate  headquarters and Instructional System Development Group from
         Wayne,  Pennsylvania  to the  Company's  principal  System  Design  and
         Production Center in Orlando,  Florida. The relocation was completed in
         September 1998. In addition, as a result of recurring net losses in the
         UK  operations,  the Board of  Directors  announced,  during  the first
         quarter of fiscal year 1999,  the approval of a plan to  wind-down  and
         discontinue the UK operations, which was completed in May 1999. Charges
         totaling $3.2 million in 1999 related primarily to employee termination
         benefits and lease termination  costs. There were no additional charges
         during fiscal year 2000 or the first two quarters of fiscal year 2001.

         The following table sets forth the details and the cumulative  activity
         in the  remaining  accrual  associated  with  the  wind-down  of the UK
         operations  and  relocation  of the Wayne  Office  in the  Consolidated
         Balance Sheet at June 30, 2000 and December 31, 2000 (in thousands).

                    Balance at 6/30/00          $    142
                    Cash Reduction Payments          (93)
                    Non-Cash Activity                 (2)
                                                --------
                    Balance at 12/31/00         $     47
                                                ========

         On  November  1, 2000,  the  Company  reduced  its  operating  costs by
         eliminating approximately 60 employee positions throughout the Company.
         This reduction in force affected approximately 24% of all employees and
         represents approximately $2.8 million in annual compensation costs. The
         employee  termination  benefits  associated with the reduction in force
         totaled  approximately  $901,000 of which  approximately  $839,000  and
         $62,000  were  recorded  to cost of  sales  and  selling,  general  and
         administrative expenses,  respectively.  The following table sets forth
         the details and the cumulative  activity associated with the accrual of
         these termination costs.


                                                                               9
<PAGE>

                    Termination Benefits Incurred         $   901
                    Cash Reduction Payments                  (300)
                                                          -------
                    Balance at 12/31/00                   $   601
                                                          =======

         The balance of the accrued termination  benefits is included in Accrued
         Expenses and Other. In addition to the November reduction in force, the
         Company  previously  terminated  approximately 45 employees on July 14,
         2000  affecting  approximately  15% of all employees and  approximately
         $1.5 million in annual  compensation  costs.  The employee  termination
         benefits   associated   with  the  July   reduction  in  force  totaled
         approximately $517,000 and were paid primarily during the first quarter
         of fiscal year 2001.

         6.   Business Segment Information

         The Company operates in one segment-training. This segment includes the
         design and manufacture of training simulators.

         Sales by Class of Customer

                                        Six Months Ended     Three Months Ended
                                      12/31/00    12/31/99  12/31/00   12/31/99
                                      --------    --------  --------   --------
                                                  (In Thousands)
         U.S. Department of Defense
         Direct                      $  5,765    $  3,262   $ 3,504    $ 1,260
         Subcontract                    9,254      17,984     4,044      9,798
                                     --------    --------   -------    -------
         Total Sales                 $ 15,019    $ 21,246   $ 7,548    $11,058
                                     ========    ========   =======    =======

         Export Sales from the U.S.  were not material for the  three-month  and
         six-month periods ended December 31, 2000 and December 31, 1999. Export
         sales do not include  Foreign  Military  Sales through U.S.  Government
         agencies  and  prime  contractors  of  $219,000  and  $416,000  for the
         three-month   and   six-month   periods   ended   December   31,  1999,
         respectively.  There were no Foreign Military Sales for the three-month
         and six-month periods ended December 31, 2000.

         Since a substantial  portion of the Company's revenues are attributable
         to long-term  contracts with various  government  agencies,  any factor
         affecting procurement of long-term government contracts such as changes
         in government spending,  cancellation of weapons programs and delays in
         contract awards could have a material impact on the Company's financial
         condition and results of operations.

         Sales by Geographic Area

         All of the Company's  Revenues,  Operating Income and Long-Lived Assets
         are within the United States.

                                                                              10

<PAGE>


7.       Earnings Per Share

         Basic  earnings  per common  share is computed by dividing net earnings
         available  to common  stockholders  by the  weighted-average  number of
         common shares outstanding during the period. Diluted earnings per share
         is computed by dividing net earnings  available to common  stockholders
         by the weighted-average  number of common shares outstanding during the
         period  adjusted  for  the  number  of  shares  that  would  have  been
         outstanding  if the dilutive  potential  common shares had been issued.
         The diluted  earnings per share does not assume the exercise of options
         that would have an antidilutive effect on earnings per share.

         The  weighted-average  number of  common  shares  outstanding  for each
         period presented is as follows:

                              Six Months Ended            Three Months Ended
                         12/31/00      12/31/99        12/31/00      12/31/99
                         --------      --------        --------      --------

           Basic         8,223,757     8,418,345      8,067,825     8,424,088
           Dilutive      8,223,757     8,470,330      8,067,825     8,472,827



                                                                              11
<PAGE>


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

            Overview

            This  Quarterly   Report  on  Form  10-Q  contains   forward-looking
            statements  within  the  meaning of  Section  21E of the  Securities
            Exchange Act of 1934, as amended,  and Section 27A of the Securities
            Act of 1933, as amended.  For this purpose, any statements contained
            herein that are not  statements of historical  fact may be deemed to
            be forward-looking  statements.  Without limiting the foregoing, the
            words  "believes,"  "anticipates,"  "plans,"  "expects," and similar
            expressions  are  intended to identify  forward-looking  statements.
            There are a number of factors that could cause the Company's  actual
            results  to  differ   materially   from  those   indicated  by  such
            forward-looking   statements.   These   factors   include,   without
            limitation, those set forth below under the caption "Certain Factors
            That May Affect Future Operating Results."

a)          Material Changes in Financial Condition

            During the six-month  period ended  December 31, 2000, the Company's
            principal source of cash was collections on accounts  receivable and
            borrowings on the Credit Facility. The principal uses of these funds
            were to make  vendor and payroll  payments,  lease  termination  and
            contract novation payments and treasury stock purchases.

            The cash balance  decreased since fiscal year end 2000 primarily due
            to the  repurchase of stock in the first two quarters of fiscal year
            2001.

            Accounts receivable decreased in the six-month period ended December
            31, 2000 primarily as a result of receipts on the Javelin Multi-Year
            1 and F-18 programs,  which were  essentially  completed by December
            31, 2000.

            Costs and estimated  earnings in excess of billings increased in the
            six-month period ended December 31, 2000 primarily due to the timing
            of  billings  on the EST  program  and the  start-up  of the Javelin
            Multi-Year 2 program which had significant material purchases during
            the second quarter of fiscal year 2001.

            Inventories  increased  since fiscal year end 2000  primarily due to
            unabsorbed  overhead,  which will be charged to programs  during the
            balance of the year.

            Prepaid   expenses  and  other   increased   primarily  due  to  the
            pre-payment of certain property taxes.

            Other assets  decreased  since fiscal year 2000 primarily due to the
            amortization of loan costs and other deferred charges.

            Accounts  payable  increased  since  fiscal  year  end  2000  due to
            increased  material  purchases  primarily  on the  EST  and  Javelin
            Multi-Year 2 programs.

            Accrued expenses decreased since fiscal year end 2000 primarily as a
            result of the  payment of  incentives  earned in fiscal year 2000 as
            well as novation and lease termination payments made

                                                                              12

<PAGE>

            associated with the wind down of the UK division. (See Note 5 to the
            Consolidated Financial Statements.)

            Liquidity and Capital Resources

            During the  remainder of fiscal year 2001,  the Company  anticipates
            spending  approximately $300,000 for new machinery and equipment and
            to continue to refurbish the Orlando facility.

            For the periods ended December 31, 2000, and September 30, 2000, the
            Company  was not in  compliance  with  certain  financial  covenants
            required under the Credit  Facility.  The Company resolved the first
            quarter non-compliance issue by obtaining a waiver for the financial
            defaults from Mellon Bank, N.A. The Company is currently negotiating
            with Mellon Bank, N.A. to amend the Credit Facility and the December
            31, 2000  covenants and  anticipates  that any such  amendment  will
            result  in a  revision  to the  financial  covenants  such  that the
            Company will be in compliance with such revised financial covenants.
            In the event the Company is not  successful in  negotiating  revised
            covenants with its current lender,  the debt may become  immediately
            due  and  payable.   In  such  an  event,  the  Company  would  seek
            alternative  sources of financing or capital  funding to continue to
            fund operations. However, there can be no assurance that the Company
            could obtain such financing.

            Other  than as stated  above,  the  Company  currently  has no other
            material commitments for capital  expenditures.  Management believes
            that if it is successful in revising the financial  covenants  under
            the Credit Facility such that the Company will be in compliance with
            such revised  financial  covenants,  the funds  available  under the
            Credit  Facility and the Company's  projected cash flows,  including
            funds generated from operations,  will be sufficient to meet planned
            capital  commitments  and  working  capital   requirements  for  the
            foreseeable  future.  However,  there can be no  assurance  that the
            Company will be successful in negotiating  revised  covenants  under
            the Credit Facility.

b)          Material Changes in Results of Operations.

            Sales  decreased 32% or $3.5 million and 29% or $6.2 million for the
            three-month   and  six-month   periods  ended   December  31,  2000,
            respectively,  as compared to the same  periods  ended  December 31,
            1999.  The reduction in sales is primarily due to the  completion of
            the Javelin  Multi-Year 1 and AGTS  contracts,  and the delay in the
            award of the Javelin Multi-Year 2 program.

            Gross  profit  decreased  89% and 61%  during  the  three-month  and
            six-month periods ended December 31, 2000, respectively, as compared
            to the same periods  ended  December 31,  1999.  In addition,  gross
            profit as a percentage  of sales  decreased to 3% and 17% during the
            three-month   and  six-month   periods  ended   December  31,  2000,
            respectively,  as compared to 33% and 31% for the same periods ended
            December  31,  1999.  The  decreases  are due to reduced  volume and
            higher  overhead  absorption  rates.  The  overhead  rate  increased
            primarily  due to the $1.4  million of severance  costs  incurred in
            fiscal year 2001 and a 40% decrease in projected  direct labor base.
            Also, additional losses were recorded in fiscal year 2001 related to
            the development phase of the EST program.


                                                                              13
<PAGE>

            Interest  expense  decreased 74% and 76% during the  three-month and
            six-month periods ended December 31, 2000, respectively, as compared
            to the same  periods  ended  December  31,  1999.  This  decrease is
            primarily  a result  of the  Company  maintaining  a  positive  cash
            balance for the first five months of fiscal year 2001.

            Other-Net   increased  42%  and  260%  during  the  three-month  and
            six-month periods ended December 31, 2000, respectively, as compared
            to the same period ended December 31, 1999. This change is primarily
            a  result  of  gains  on  the  sale  of  certain  fixed  assets  and
            translation  gains on foreign  exchange  transactions in fiscal year
            2001, whereas the Company suffered translation losses in fiscal year
            2000.

            The tax provision  recorded during the second quarter of fiscal year
            2001 is due to a valuation  allowance for an alternative minimum tax
            credit of  $120,000  paid for the fiscal  year ended June 30,  2000.
            This valuation  allowance was recorded due to the  uncertainty as to
            the ultimate realization of the tax credit. In addition, the Company
            has approximately  $5.4 million of cumulative  federal net operating
            loss  carryforwards,  which expire in 2013 and 2018.  This amount is
            prior to any potential net operating losses generated in the current
            year.

c)          Certain Factors That May Affect Future Operating Results

            The following  important factors,  among others,  could cause actual
            results to differ materially from those indicated by forward-looking
            statements made in this Quarterly  Report on Form 10-Q and presented
            elsewhere  by  management  from  time to time.  All  forward-looking
            statements  included  in this  Form  10-Q are  based on  information
            available to the Company on the date hereof, and the Company assumes
            no obligation to update any such forward-looking statements.

            A number of  uncertainties  exist  that could  affect the  Company's
            future operating results,  including,  without  limitation,  general
            economic  conditions,  changes  in  government  spending,  borrowing
            availability  under the  Credit  Facility,  cancellation  of weapons
            programs,  delays  in  contract  awards,  delays  in the  acceptance
            process of contract deliverables, the Company's continued ability to
            develop and introduce products,  the introduction of new products by
            competitors,   pricing  practices  of  competitors,   the  cost  and
            availability of parts and the Company's ability to control costs.

            To date, a substantial  portion of the Company's  revenues have been
            attributable   to  long-term   contracts  with  various   government
            agencies. As a result, any factor adversely affecting procurement of
            long-term  government contracts could have a material adverse effect
            on the Company's financial condition and results of operations.

            Because  of these  and other  factors,  past  financial  performance
            should not be considered an  indication of future  performance.  The
            Company's future quarterly operating results may vary significantly.
            Investors  should not use  historical  trends to  anticipate  future
            results and should be aware that the trading  price of the Company's
            Common  Stock may be subject to wide  fluctuations  in  response  to
            quarterly   variations  in  operating  results  and  other  factors,
            including those discussed above.


                                                                              14
<PAGE>


ITEM 3.  Quantitative and Qualitative Disclosures About Market Risk

The Company is subject to interest rate risk on its borrowings  under the Credit
Facility.  The Credit Facility has a floating  interest rate based on prevailing
market  rates.  Accordingly,  the carrying  value of the debt is  generally  not
affected by fluctuations in interest  rates.  However,  such changes in interest
rates could affect future interest expense and hence earnings and cash flows.

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

At the Company's  Annual Meeting of  Stockholders  held on November 8, 2000, the
following proposals were adopted by the vote specified below:

<TABLE>
<CAPTION>
                                        Votes          Votes                 Broker
           Proposal                     For            Against    Abstain   NonVotes

(1)   To elect the Board of Directors

<S>                                     <C>            <C>           <C>     <C>
           Julian J. Demora             7,546,921      61,408        -       196,221
           James C. Garrett             7,607,466         863        -       135,676
           James R. Henderson           7,602,103       6,226        -       141,039
           Jesse L. Krasnow             7,607,084       1,245        -       136,058
           Warren G. Lichtenstein       7,548,390      59,939        -       194,752
           Merrill A. McPeak            7,517,824      90,505        -       225,318
           Robert F. Mehmel             7,601,203       7,126        -       141,939
</TABLE>

(2)   To ratify the appointment of  PricewaterhouseCoopers  LLP as the Company's
      independent  certified public  accountants for the fiscal year ending June
      30, 2001.
<TABLE>
<CAPTION>

<S>                                     <C>             <C>          <C>     <C>
                                        7,713,546       19,583       10,013  396,697
</TABLE>


                                                                              15
<PAGE>



                                   SIGNATURES




         Pursuant to 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.




                                            ECC INTERNATIONAL CORP.




Date: February 6, 2001                      /s/ Melissa Van Valkenburgh
                                                ---------------------------
                                            Melissa Van Valkenburgh
                                            Chief Financial Officer