SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549
                                   FORM 10-QSB

(Mark One)

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

                  For the quarterly period ended March 31, 1997

                                       OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
    SECURITIES AND EXCHANGE ACT OF 1934



                          Commission File Number 0-5633


                           ENVIRONMENT ONE CORPORATION
                 (Name of small business issuer in its charter)


           New York                                             14-1505298  
--------------------------------------------------------------------------------
(State or other  jurisdiction  of                           (IRS Employer
incorporation of organization)                             Identification No.)


   2773 Balltown Road, Niskayuna, NY                            12309-1090
--------------------------------------------------------------------------------
(Address of principal executive offices)                        (Zip Code)


                    Issuer's telephone number (518) 346-6161



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

                             Yes  [ X ]    No  [   ]


                      APPLICABLE ONLY TO CORPORATE ISSUERS

   The number of shares of Common  Stock,  par value $.10 as of March 31,  1997:
4,219,054


Transitional Small Business Disclosure Format (check one):

                             Yes  [   ]    No  [ X ]
<PAGE>
                           Environment One Corporation
                                   FORM 10-QSB



                                      INDEX



                                                                     Page  
                                                                     ----  

Part I. Financial Information-

Item 1. - Financial Statements
Consolidated Balance Sheets March 31, 1997 and
December 31, 1996                                                     3-4  

Consolidated Statements of Operations for the Three Months
Ended March 31, 1997 and 1996                                          5   

Consolidated Statements of Cash Flows for the Three Months
Ended March 31, 1997 and 1996                                          6   

Notes to Consolidated Financial Statements                             7   

Item 2.
Management's Discussion and Analysis of Financial
Condition and Results of Operations                                   8-11 

Part II. Other Information                                             12  

Signatures                                                             12

























                                      - 2-
<PAGE>
<TABLE>
<CAPTION>
                        Part I - Financial Information

Item 1. Financial Statements

                           Environment One Corporation
                           Consolidated Balance Sheets
                      March 31, 1997 and December 31, 1996

         Assets                                       3/31/97          12/31/96
                                                  ------------      ------------
<S>                                               <C>               <C>
Current Assets
          Cash and Cash Equivalents .........     $     69,967            62,637
          Accounts Receivable, Net ..........        4,506,278         4,931,421
          Inventories
             Raw Materials ..................        1,766,978         1,439,020
             Work in Process ................          224,062           469,001
             Finished Goods .................          480,609           364,079
                                                  ------------      ------------
                                                     2,471,649         2,272,100
Other Current Assets ........................          466,603           347,577
                                                  ------------      ------------
     Total Current Assets ...................        7,514,497         7,613,735
                                                  ------------      ------------

Property, Plant and Equipment
     Land ...................................          334,491           334,491
     Buildings ..............................        2,271,832         2,271,832
     Machinery and Equipment ................        5,067,877         5,024,175
     Construction in Progress ...............          129,886            50,689
     Less: Accumulated Depreciation .........       (4,445,173)       (4,310,173)
                                                  ------------      ------------
     Net Property, Plant and Equipment ......        3,358,913         3,371,014
Other Assets ................................          254,631           269,792
                                                  ------------      ------------
Total Assets ................................       11,128,041        11,254,541
                                                  ============      ============

         Liabilities and Shareholders' Equity

Current Liabilities
     Book Overdraft .........................           87,904                 0
     Current Installments - Long Term Debt ..          338,100           338,100
     Notes Payable - Bank ...................          454,000            75,000
     Accounts Payable .......................        1,480,206         1,918,866
     Accrued Expenses .......................        1,062,102         1,296,170
                                                  ------------      ------------
          Total Current Liabilities .........        3,422,312         3,628,136

Deferred Compensation .......................          369,461           369,461
Minority Interest ...........................           54,871            43,068
Long Term Debt ..............................        1,415,970         1,500,494
                                                  ------------      ------------
      Total Liabilities .....................        5,262,614         5,541,159
                                                  ------------      ------------

                                     - 3 -
<PAGE>
<CAPTION>
                           Environment One Corporation
                           Consolidated Balance Sheets
                      March 31, 1997 and December 31, 1996

                                                      3/31/97          12/31/96
                                                  ------------      ------------
<S>                                               <C>               <C>
Shareholders' Equity
     Common Stock at Par Value ..............          423,855           416,997
     Additional Paid in Capital .............        7,816,493         7,446,789
     Accumulated Deficit ....................       (1,931,220)       (2,076,164)
                                                  ------------      ------------
                                                     6,309,128         5,787,622
     Less: Treasury Stock at Cost ...........         (443,701)          (74,240)
                                                  ------------      ------------
       Total Shareholders' Equity ...........        5,865,427         5,713,382
                                                  ------------      ------------

Total Liabilities and Shareholders' Equity ..     $ 11,128,041        11,254,541
                                                  ============      ============

          (See Accompanying Notes to Consolidated Financial Statements)
</TABLE>


































                                     - 4 -
<PAGE>
<TABLE>
<CAPTION>
                           Environment One Corporation
                      Consolidated Statements of Operations
               For the Three Months Ended March 31, 1997 and 1996

                                                  Three Months Ended March 31,
                                                 -------------------------------
                                                     1997               1996
                                                 -----------        ------------ 
<S>                                              <C>                <C>
Revenue ..................................       $ 4,547,725          3,945,236
                                                 -----------        -----------

Costs and Expenses

          Cost of Sales ..................         2,934,433          2,866,375

          Selling and Marketing ..........           601,876            529,357

          General and Administrative .....           738,377            362,202

          Interest Expense ...............            41,984             62,723

         Other Expense (Income) ..........            (2,489)          (177,964)
                                                 -----------        -----------

Total Expenses, Net ......................         4,314,181          3,642,693
                                                 -----------        -----------


Net Earnings Before Taxes ................           233,544            302,543

Income Tax Expense .......................            88,600            113,700
                                                 -----------        -----------


Net Earnings .............................           144,944            188,843
                                                 ===========        ===========

Per Share Amounts:
Primary Earnings per Common Share ........       $      0.03        $      ---
Fully Diluted Earnings per Common Share ..              0.03               ---
Weighted Average Earnings per Common Share       $       ---        $      0.05
                                                 ===========        ===========

          (See Accompanying Notes to Consolidated Financial Statements)
</TABLE>










                                     - 5 -
<PAGE>
<TABLE>
<CAPTION>
                                Environment One Corporation
                           Consolidated Statements of Cash Flows
                     For the Three Months Ended March 31,1997 and 1996

                                                              Three Months Ended March 31,
                                                              ---------------------------- 
                                                                    1997           1996
                                                                 ---------      --------- 
<S>                                                              <C>            <C>
Cash Flows-Operating Activities:

Net Earnings ...............................................     $ 144,944        188,843

Adjustments to Reconcile Net Earnings
to Net Cash Provided (Used) by Operating Activities:

Depreciation and Amortization ..............................       144,117        162,908
Decrease (Increase) - Accounts Receivable, Net .............       425,143       (625,032)
Decrease (Increase) - Inventories ..........................      (199,549)      (187,520)
Decrease (Increase) - Prepaid Expenses .....................      (119,026)       (30,572)
Decrease (Increase) - Other L/T Assets .....................         6,044            605
Increase (Decrease) - Accounts Payable .....................      (438,660)       384,164
Increase (Decrease) - Accrued Expenses and Other Liabilities      (234,068)        38,239
Increase (Decrease) - Minority Interest ....................        11,803         (6,398)
                                                                 ---------      ---------
Net Cash Provided (Used) by Operating Activities ...........      (259,252)       (74,763)
                                                                 ---------      ---------

Cash Flows Used in Investing Activities:
Capital Expenditures .......................................      (122,899)      (132,249)
                                                                 ---------      ---------

Cash Flows From Financing Activities:
Increase (Decrease) - Book Overdraft .......................        87,904              0
Increase (Decrease) - Note Payable to Bank .................       379,000        350,000
Increase (Decrease) - Long Term Debt .......................       (84,524)       (84,611)
Issuance of Common Stock ...................................         7,101          1,875
Purchase of Treasury Stock .................................             0        (16,609)
                                                                 ---------      ---------
Net Cash Provided (Used) by Financing Activities ...........       389,481        250,655
                                                                 ---------      ---------

Net Increase (Decrease) in Cash and Cash Equivalents .......         7,330         43,643

Cash and Cash Equivalents at Beginning of Period ...........        62,637         91,115
                                                                 ---------      ---------

Cash and Cash Equivalents at End of Period .................     $  69,967        134,758
                                                                 =========      =========

Supplemental disclosure of non-cash financing activity:

Issuance of 65,681 shares of common stock held in trust and 
recorded as treasury stock as part of the Company's 
deferred compensation plan for certain executive officers        $ 369,461           --
                                                                 =========      =========
               (See Accompanying Notes to Consolidated Financial Statements) 
</TABLE>
                                     - 6 -
<PAGE>
                           Environment One Corporation
                   Notes to Consolidated Financial Statements
               For the Three Months Ended March 31, 1997 and 1996

                                   (Unaudited)

         1.  In  the  opinion  of   management,   the   accompanying   unaudited
consolidated  financial statements contain all adjustments,  which are only of a
normal   recurring   nature,   necessary  to  fairly  present   Environment  One
Corporation's  financial  position as of March 31, 1997 and December 31, 1996 as
well as the  results of  operations  and cash flows for the three  months  ended
March 31, 1997 and 1996.  Operating  results for any quarter are not necessarily
indicative of results for any future periods.

         2. Net earnings per share  computations  are based on primary and fully
diluted number of shares of Common Stock outstanding for the period ending March
31, 1997 and the weighted  average number of shares of Common Stock  outstanding
for the period ending March 31, 1996.  (March 31, 1997;  4,388,467 and 4,404,171
shares, March 31, 1996; 4,114,657 shares).

In February 1997, the Financial  Accounting  Standards Board issued Statement of
Financial  Accounting  Standards No. 128,  "Earnings per Share" (Statement 128),
which  establishes  standards for computing  and  presenting  earnings per share
(EPS).  This  Statement  simplifies  the standards for computing EPS making them
comparable to international EPS standards and supersedes  Accounting  Principals
Board  Opinion  No.  15,  "Earnings  per  Share"  and  related  interpretations.
Statement 128 replaces the  presentation of primary EPS with the presentation of
basic EPS. It also  requires dual  presentation  of basic and diluted EPS on the
face of the income  statement for all entities with complex  capital  structures
and requires a reconciliation  of the numerator and denominator of the basic EPS
computation to the numerator and denominator of the diluted EPS computation.

Basic EPS excludes  dilution  (such as the effect of the  Company's  outstanding
stock  options)  and  is  computed  by  dividing  income   available  to  common
stockholders by the weighted-average number of common shares outstanding for the
period.  Diluted  EPS  reflects  the  potential  dilution  that  could  occur if
securities or other  contracts to issue common stock were exercised or converted
into common  stock or resulted in the  issuance of common stock that then shared
in the  earnings  of the entity  (such as the  Company's  stock  options).  This
Statement is effective for financial  statements issued for periods ending after
December  15,  1997,  including  interim  periods.  Earlier  application  is not
permitted.  This Statement  requires  restatement of all  prior-period  EPS data
presented.

The Company will present its EPS information in accordance with Statement 128 as
of December 31, 1997. Manaagement anticipates that the effect of the adoption of
this  Statement  will not have a material  effect on the Company's  consolidated
financial statements.

         3. In January,  1996,  the Company  concluded an agreement  with PROTEC
Fire Detection,  plc of Nelson,  Lancashire,  England for the sale of its Cirrus
IFD  product  line.  In a two-stage  transaction  with an  approximate  value of
$750,000, the Company transferred all Cirrus IFD assets and operations to PROTEC
and simultaneously  entered into a product technology  development contract that
was concluded in 1996. The pre-tax impact of the sale, net of certain  expenses,
was a gain of  $176,000  and is  recorded as other  income in the  statement  of
operations for the quarter ended March 31, 1996.

                                     - 7 -
<PAGE>
Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations

Results of Operations
The following  information  should be read in conjunction  with the consolidated
financial  statements  and notes  thereto  included in Item 1 of this  Quarterly
Report,  and  the  consolidated  financial  statements  and  notes  thereto  and
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations  contained in the Company's Annual Report on Form 10-KSB for the year
ended December 31, 1996.


                   Three Months Ended March 31, 1997 and 1996
                   (all figures rounded to the nearest 000's)


Revenue for the period  increased  $602,000,  or 15.3% over the same period last
year. Increases over results from the quarter ended March 31, 1996 were recorded
in both Sewer Systems and Detection Systems businesses.

Revenue's from the Company's Sewer Systems business continue to show improvement
over prior  periods.  Management  is of the opinion  that the addition of a more
powerful  distribution  network,  increases  in the number and size of municipal
projects,  continued  growth in the overall market and  realignment of its sales
territories accounts for this growth and bodes well for future growth.

As part  of the  Detection  Systems  business  revenue  increase,  sales  of the
Company's Hydrogen Control Cabinet showed significant improvement as the Company
did not ship any units in the first  quarter of 1996 due to  customer  delays in
placing orders.  Generator  Condition Monitor sales remained virtually flat over
the same  period last year.  The Company  continued  to  manufacture  and supply
Cirrus IFD units to PROTEC  during the first  quarter and is expecting to finish
its commitment with PROTEC in the second quarter of 1997.

Cost of Sales  increased  $68,000  when  compared  to the same period last year.
Expressed in percent of sales,  cost of sales  decreased from 72.6% in the first
three  months of 1996 to 64.5% in the three  months  ended March 31,  1997.  The
resulting  improvement in gross margin is mainly  attributable to reduced direct
material costs expressed as a percent of sales resulting from changes in product
mix on a comparative quarter basis.  Indirect costs remained virtually flat on a
quarter to quarter basis.

Selling and Marketing costs increased  $73,000  compared to the first quarter of
1996. The majority of this increase  resulted from increases in  expenditures in
advertising,  promotion and sales literature as the Company continues its effort
to support the Sewer Systems  business  distribution  network.  During the first
quarter of 1997,  the Company  closed its Sewer System sales  offices in Georgia
and Texas. During 1996, the Company added new and more powerful  distributors in
both areas along with  opening a new sales  office in New Mexico  allowing for a
smooth transition in territory realignment despite closing of the two offices.








                                     - 8 -
<PAGE>
              Three Months Ended March 31, 1997 and 1996, continued
                   (all figures rounded to the nearest 000's)

General and Administrative costs, including research and development, increased
$376,000  over the  same  period  last  year.  Research  and  development  costs
increased  $23,000  while  other  general  and  administrative  costs  increased
$353,000.

The major portion of the increase in other general and  administrative  costs is
attributable to an increased growth performance  sharing expense accrual. In the
first quarter of 1996, the Company  implemented a new growth performance sharing
plan to take the place of its profit  sharing plan.  Targets for growth in sales
and  operational  earnings along with return on assets were  established and are
reviewed on an annual basis.  Quarterly  expense  accruals are made based on the
performance of the Company.

Interest expense decreased $21,000 over the first three months of 1996.  Average
monthly debt during the first  quarter of 1997 was  $655,000  less than the same
period in 1996.  The reduced debt level along with a reduction in interest rates
due to a lower bank prime rate account for the lower interest cost.

Other income  decreased  $175,000  over last year as a result of the sale of the
Cirrus IFD product line to PROTEC in the first quarter of 1996.


                        Financial Position and Liquidity
                   (all figures rounded to the nearest 000's)

Cash needs for the first three  months of 1997 were met  primarily by short term
borrowing on the Company's  line of credit of $379,000,  most of which  occurred
during the month of March. Capital expenditures  remained flat at $123,000 along
with a reduction  in long term debt of $85,000.  Borrowing on the line of credit
was  primarily  due to an increase in  inventory  of $200,000  and a decrease in
accounts payable of $439,000.  During the same period last year, the Company was
able to reduce short term  borrowing by $350,000  along with  reducing long term
debt by $85,000.

During the first quarter of 1997, the Company  improved its method of banking by
initiating a "target  balance"  program with Fleet Bank. This program allows the
maximum use of outstanding  checks and provides for overnight  interest  bearing
use of available  funds.  As a result,  a new  account,  "book  overdraft",  now
appears on the  consolidated  balance sheet and  consolidated  statement of cash
flows.

Continued control over inventory,  operating  expenses and capital  expenditures
along with forecasted cash receipts and line of credit  availability will enable
the Company to meet its  day-to-day  working  capital  requirements  in the near
term.

The line of  credit,  which  expired  in April of 1997,  has been  approved  for
renewal  by  the  Company's   primary  lender.  At  the  same  time,  a  pricing
modification to the Company's term loan has been offered to allow the Company to
purchase  a fixed  rate swap.  In  consideration  for the  renewal  and  pricing
modification,  the lender has modified  certain loan  covenants.  Management  is
currently  reviewing these proposals and is confident that a successful  outcome
will be reached.


                                     - 9 -
<PAGE>
             CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR"
       PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

The Private  Securities  Litigation  Reform Act of 1995 (the  "Act")  provides a
"safe harbor" for  forward-looking  statements to encourage companies to provide
prospective  information about themselves while limiting unwarranted litigation,
provided  that  the  statements  are  identified  as  forward-looking   and  are
accompanied by meaningful cautionary statements regarding important factors that
could cause  actual  results to differ  materially  from those  projected in the
statement. The Company desires to take advantage of the "safe harbor" provisions
of the Act, and is including the information set forth below in this Form 10-QSB
to point out the  inherent  difficulties  in  predicting  the  impact of certain
factors.

While the Company believes that its assumptions  underlying any  forward-looking
statements are reasonable,  the following information includes important factors
which could cause the Company's  actual  results to differ  materially  from any
result  which  might be  projected,  forecasted,  estimated,  or budgeted by the
Company in its forward-looking statements, whether contained in this Form 10-QSB
or otherwise.

1. Heightened  competition,  including the intensification of price competition,
the entry of new  competitors,  and the  introduction of new products by new and
existing competitors.

2. Failure to obtain new customers or retain existing customers.

3. Adverse  publicity and news coverage  impacting the Company's  reputation and
sales potential.

4. Inability to carry out marketing and sales plans due to unforeseen factors.

5. Significant economic downturns in the geographic market areas serviced by the
Company.

6. Higher service,  administrative,  or general expenses  occasioned by the need
for additional advertising, marketing, administrative, or management information
systems expenditures.
 
7. A lack of availability of raw materials,  necessary manufacturing  equipment,
or contract manufacturers to meet the Company's needs.

8.  Underutilization  of the  Company's  manufacturing  resources,  resulting in
production inefficiencies and higher costs.

9. Start-up expenses,  inefficiencies,  delays, and increased depreciation costs
in connection  with the start of production in new  facilities and expansions of
existing facilities.
 
10.  The  acquisition  of  fixed  and  other  assets,  including  inventory  and
receivables,  and the making or  incurring  of any  expenditures  and  expenses,
including but not limited to depreciation and research and development expenses.
 
11. Any  revaluation  of assets or related  expenses  and the amount of, and any
changes to, tax rates.

12. Loss or retirement of key executives.

                                     - 10 -
<PAGE>
13.  Any  activities  of  parties  with  which the  Company  has  agreements  or
understandings,  including  matters affecting any investment or joint venture in
which the Company has an investment.

14. The amount,  type, and cost of the financing  available to the Company,  and
any changes to that financing.

15. Adverse results in significant litigation or regulatory proceedings.

16.  Adverse  changes in laws,  regulations,  interpretations,  and  enforcement
policies affecting the Company and its business operations.

17. Natural  disasters,  work stoppages,  and other events beyond the control of
the Company.

The foregoing list of factors  should not be construed as exhaustive,  or as any
admission regarding the adequacy of disclosures made by the Company prior to the
filing of this Form 10-QSB.








































                                     - 11 -
<PAGE>

                           Environment One Corporation
                                   FORM 10-QSB


                           Part II - Other Information


     Not Applicable



                                   SIGNATURES

Pursuant to the  requirements  of the  Securities  and Exchange Act of 1934,  as
amended,  the  Registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.

                                                    ENVIRONMENT ONE CORPORATION


Date: May 9, 1997                                By:/s/Stephen V. Ardia
                                                    -------------------
                                                    Stephen V. Ardia
                                                    Chairman, President and CEO




Date: May 9, 1997                                By:/s/ Philip W. Welsh
                                                    -------------------
                                                    Philip W. Welsh
                                                    Director of Finance
                                                    Treasurer

























                                     - 12 -