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 June 30, 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 June 30,  1997:
4,230,762.


Transitional Small Business Disclosure Format (check one):
 
                             Yes  [   ]    No  [ X ]
<PAGE>
                           Environment One Corporation
                                   FORM 10-QSB



                                      INDEX



                                                                   Page No.
                                                                   --------  

Part I. Financial Information-

Item 1. - Financial Statements
Consolidated Balance Sheets June 30, 1997 and
December 31, 1996                                                    3 - 4   

Consolidated Statements of Income for the Six Months
Ended June 30, 1997 and 1996                                           5     

Consolidated Statements of Income for the Three Months
Ended June 30, 1997 and 1996                                           6     

Consolidated Statements of Cash Flows for the Six Months
Ended June 30, 1997 and 1996                                         7 - 8   

Notes to Consolidated Financial Statements                             9     

Item 2.
Management's Discussion and Analysis of Financial
Condition and Results of Operations                                 10 - 14  

Part II. Other Information                                            15     
                                  
Signatures                                                            16    






















                                      -2-
<PAGE>
Item 1. Financial Statements
<TABLE>
<CAPTION>
                           Environment One Corporation
                           Consolidated Balance Sheets
                       June 30, 1997 and December 31, 1996


                                                      6/30/97          12/31/96
                                                  ------------      ------------
<S>                                               <C>               <C>
         Assets

Current Assets
     Cash and Cash Equivalents ..............     $    561,883            62,637
     Accounts Receivable, Net ...............        4,911,763         4,931,421
     Inventories
             Raw Materials ..................        1,534,559         1,439,020
             Work in Process ................          204,990           469,001
             Finished Goods .................          221,159           364,079
                                                  ------------      ------------
                                                     1,960,708         2,272,100
Other Current Assets ........................          475,046           347,577
                                                  ------------      ------------
     Total Current Assets ...................        7,909,400         7,613,735
                                                  ------------      ------------

Property, Plant and Equipment
     Land ...................................          334,491           334,491
     Buildings ..............................        2,294,861         2,271,832
     Machinery and Equipment ................        5,194,684         5,024,175
     Construction in Progress ...............           86,569            50,689
     Less: Accumulated Depreciation .........       (4,610,173)       (4,310,173)
                                                  ------------      ------------
     Net Property, Plant and Equipment ......        3,300,432         3,371,014
Other Assets ................................          242,113           269,792
                                                  ------------      ------------
Total Assets ................................       11,451,945        11,254,541
                                                  ============      ============

         Liabilities and Shareholders' Equity

Current Liabilities
     Current Installments - Long Term Debt ..          338,100           338,100
     Note Payable - Bank ....................                0            75,000
     Accounts Payable .......................        1,806,096         1,918,866
     Accrued Expenses .......................        1,176,484         1,296,170
                                                  ------------      ------------
          Total Current Liabilities .........        3,320,680         3,628,136

Deferred Compensation .......................          369,461           369,461
Minority Interest ...........................           49,175            43,068
Long Term Debt ..............................        1,331,445         1,500,494
                                                  ------------      ------------
      Total Liabilities .....................        5,070,761         5,541,159
                                                  ------------      ------------
</TABLE>

                                      -3-
<PAGE>
<TABLE>
<CAPTION>
                           Environment One Corporation
                           Consolidated Balance Sheets
                       June 30, 1997 and December 31, 1996
                                  (continued)


                                                     6/30/97          12/31/96
                                                  ------------      ------------
<S>                                               <C>               <C>
Shareholders' Equity
     Common Stock at Par Value ..............          425,115           416,997
     Additional Paid in Capital .............        7,899,222         7,446,789
     Accumulated Deficit ....................       (1,492,873)       (2,076,164)
                                                  ------------      ------------
                                                     6,831,464         5,787,622
     Less: Treasury Stock at Cost ...........         (450,280)          (74,240)
                                                  ------------      ------------
       Total Shareholders' Equity ...........        6,381,184         5,713,382
                                                  ------------      ------------

Total Liabilities and Shareholders' Equity ..     $ 11,451,945        11,254,541
                                                  ============      ============

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































                                      -4-
<PAGE>
<TABLE>
<CAPTION>
                           Environment One Corporation
                        Consolidated Statements of Income
                 For the Six Months Ended June 30, 1997 and 1996



                                                    Six Months Ended June 30,
                                                 ------------------------------- 
                                                      1997              1996
                                                 ------------      ------------
<S>                                              <C>               <C>
Revenue ....................................     $ 10,250,728         9,273,381
                                                 ------------      ------------

Costs and Expenses

          Cost of Sales ....................        6,692,690         6,569,901

          Selling and Marketing ............        1,220,681         1,083,242

          General and Administrative .......        1,321,042           769,662

          Interest Expense, Net ............           81,946           129,828

          Other Income, Net ................          (10,222)         (180,090)
                                                 ------------      ------------

Total Expenses, Net ........................        9,306,137         8,372,543
                                                 ------------      ------------


Net Earnings Before Taxes ..................          944,591           900,838

Income Tax Expense .........................          361,300           340,800
                                                 ------------      ------------


Net Earnings ...............................          583,291           560,038
                                                 ============      ============

Per Share Amounts:
Primary Earnings per Common Share ..........     $       0.13
Fully Diluted Earnings per Common Share ....             0.13
Weighted Average Earnings per Common Share .                       $       0.14
                                                 ============      ============

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








                                      -5-
<PAGE>
<TABLE>
<CAPTION>
                           Environment One Corporation
                        Consolidated Statements of Income
                For the Three Months Ended June 30, 1997 and 1996



                                                    Three Months Ended June 30,
                                                   ---------------------------- 
                                                       1997             1996
                                                   -----------      -----------
<S>                                                <C>              <C>
Revenue ......................................     $ 5,703,003        5,328,145
                                                   -----------      -----------

Costs and Expenses

          Cost of Sales ......................       3,758,257        3,703,526

          Selling and Marketing ..............         618,805          553,885

          General and Administrative .........         582,665          407,460

          Interest Expense, Net ..............          39,962           67,105

          Other Income, Net ..................          (7,733)          (2,126)
                                                   -----------      -----------

Total Expenses, Net ..........................       4,991,956        4,729,850
                                                   -----------      -----------


Net Earnings Before Taxes ....................         711,047          598,295

Income Tax Expense ...........................         272,700          227,100
                                                   -----------      -----------


Net Earnings .................................         438,347          371,195
                                                   ===========      ===========

Per Share Amounts:
Primary Earnings per Common Share ............     $      0.10
Fully Diluted Earnings per Common Share ......            0.10
Weighted Average Earnings per Common Share ...                      $      0.09
                                                   ===========      ===========

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








                                      -6-
<PAGE>
<TABLE>
<CAPTION>
                                  Environment One Corporation
                             Consolidated Statements of Cash Flows
                        For the Six Months Ended June 30,1997 and 1996

                                                                    Six Months Ended June 30,
                                                                   --------------------------  
                                                                      1997            1996
                                                                   ----------      ----------
<S>                                                                <C>             <C>
Cash Flows-Operating Activities:

Net Earnings .................................................     $  583,291         560,038

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

Non-cash Compensation Expense ................................         70,000               0
Depreciation and Amortization ................................        315,612         296,658
Decrease (Increase) - Accounts Receivable, Net ...............         19,658      (1,602,358)
Decrease (Increase) - Inventories ............................        311,392         (90,006)
Decrease (Increase) - Prepaid Expenses .......................       (127,469)        (81,425)
Decrease (Increase) - Other L/T Assets .......................         12,067           3,766
Increase (Decrease) - Accounts Payable .......................       (112,770)        633,108
Increase (Decrease) - Accrued Expenses and Other Liabilities .       (112,272)        157,090
Increase (Decrease) - Minority Interest ......................          6,107         (13,756)
                                                                   ----------      ----------

Net Cash Provided (Used) by Operating Activities .............        965,616        (136,885)
                                                                   ----------      ----------

Cash Flows Used in Investing Activities:
Capital Expenditures .........................................       (229,418)       (273,599)
                                                                   ----------      ----------

Cash Flows From Financing Activities:
Increase (Decrease) - Note Payable to Bank ...................        (75,000)        575,000
Increase (Decrease) - Long Term Debt .........................       (169,049)       (169,194)
Issuance of Common Stock .....................................          7,097           2,073
Purchase of Treasury Stock ...................................              0         (34,489)
                                                                   ----------      ----------

Net Cash Provided (Used) by Financing Activities .............       (236,952)        373,390
                                                                   ----------      ----------

Net Increase (Decrease) in Cash and Cash Equivalents .........        499,246         (37,094)

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

Cash and Cash Equivalents at End of Period ...................     $  561,883          54,021
                                                                   ==========      ==========
</TABLE>




                                      -7-
<PAGE>
<TABLE>
<CAPTION>
                                  Environment One Corporation
                             Consolidated Statements of Cash Flows
                        For the Six Months Ended June 30,1997 and 1996
                                         (continued)

                                                                    Six Months Ended June 30,
                                                                   --------------------------  
                                                                      1997            1996
                                                                   ----------      ----------
<S>                                                                <C>             <C>
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            --
                                                                   ==========      ==========

  Exchange of 892 and 2,390 shares of common stock in
    partial  payment  of exercise price on stock options
    during 1997 and 1996, respectively .......................     $    6,579          14,340
                                                                   ==========      ==========

  Tax benefit from exercise of stock options .................     $    7,414          31,425
                                                                   ==========      ==========

Cash paid during the year for:
   Interest ..................................................     $   89,736         129,964
                                                                   ==========      ==========
   Income Taxes ..............................................     $  461,894         231,321
                                                                   ==========      ==========

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























                                      -8-
<PAGE>
                           Environment One Corporation
                   Notes to Consolidated Financial Statements
                For the Three Months Ended June 30, 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 June 30, 1997 and December 31, 1996, the
results of operations  for the three and six months ended June 30, 1997 and 1996
and cash  flows for the six  months  ended  June 30,  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 ended June
30, 1997 and the weighted  average number of shares of Common Stock  outstanding
for the period ended June 30,  1996.  (June 30, 1997;  4,400,164  and  4,453,742
shares, June 30, 1996; 4,114,851 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 of 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. Management  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 six months ended June 30, 1996.
                                      -9-
<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.

                     Six Months Ended June 30, 1997 and 1996
                   (all figures rounded to the nearest 000's)

Revenue for the period  increased  $977,000,  or 10.5% over the same period last
year. Increased revenues were recorded over the first six months of 1996 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 over the same
period  last year as the  Company  began  shipment  of the product in the second
quarter of 1996.  Generator Condition Monitor sales also showed improvement over
the same period last year buoyed by strong second quarter sales.

The  Company  continued  to  manufacture  and supply  Cirrus IFD units to PROTEC
during the first six months of 1997 and is  expecting  to finish its  commitment
with PROTEC in the third quarter of 1997.

Cost of sales  increased  $123,000  when  compared to the same period last year.
Expressed  as a percent of sales,  cost of sales  decreased  by 5.5 points  from
70.8% to 65.3%. 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  period basis.  Indirect costs increased
slightly in the  categories  of  maintenance,  incoming  freight and small tools
reflecting  the  impact of higher  variable  indirect  manufacturing  costs as a
result of increased shipments during the period.

Selling and Marketing costs increased  $137,000 compared to the first six months
of 1996. The majority of this increase resulted from increased  expenditures for
sales  promotion and  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.

General and Administrative costs, including research and development,  increased
$551,000  over the  same  period  last  year.  Research  and  development  costs
increased  $23,000  while  other  general  and  administrative  costs  increased
$528,000.

                                      -10-
<PAGE>
               Six Months Ended June 30, 1997 and 1996, continued
                   (all figures rounded to the nearest 000's)

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.  Other expense categories showing increases over the
same  period  last  year  include  training,   legal,  consultant  and  investor
relations.

Interest expense  decreased  $48,000 over the same period last year. The primary
reason  for the lower  interest  expense  is  reduced  borrowing  on the line of
credit.  In the second quarter of 1997,  the Company had very limited  borrowing
during the early part of the quarter and was able to make overnight  investments
with available funds for the majority of the quarter thereby generating interest
income.

Other income  decreased  $168,000  over last year as a result of the sale of the
Cirrus IFD product line to PROTEC in the first quarter of 1996.

                    Three Months Ended June 30, 1997 and 1996
                   (all figures rounded to the nearest 000's)

Revenue  for the period  increased  $375,000,  or 7.0% over the same period last
year.  Increased  revenues from the quarter ended June 30, 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 and  Generator  Condition  Monitor  showed
significant improvement over the same period last year.

The  Company  continued  to  manufacture  and supply  Cirrus IFD units to PROTEC
during the second quarter of 1997 and is expecting to finish its commitment with
PROTEC in the third quarter of 1997.

Cost of Sales  increased  $55,000  when  compared  to the same period last year.
Expressed in percent of sales,  cost of sales decreased from 69.5% in the second
quarter  of  1996  to  65.9%  in the  second  quarter  of  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 increased slightly in the categories
of  incoming  freight,  small  tools and scrap  reflecting  the impact of higher
variable indirect  manufacturing costs as a result of increased shipments during
the period.

Selling and Marketing costs increased  $65,000 compared to the second quarter of
1996.  The majority of this increase  resulted from  increased  expenditures  in
sales promotion and selling and marketing  labor costs as the Company  continues
its effort to support the Sewer Systems business distribution network.
                                      -11-
<PAGE>
              Three Months Ended June 30, 1997 and 1996, continued
                   (all figures rounded to the nearest 000's)

General and Administrative costs, including research and development, increased
$175,000 over the same period last year. Research and development costs remained
flat with other general and  administrative  costs  accounting for the increased
expense on a comparative quarter basis.

In the other general and administrative  costs area, increased expenses over the
prior  comparative  quarter  were  recognized  in  legal,  consultant,  tuition,
investor relations and training expense categories.

Interest  expense  decreased  $27,000  over the second  quarter of 1996.  In the
second quarter of 1997, the Company had very limited  borrowing during the early
part of the quarter and was able to make  overnight  investments  with available
funds for the majority of the quarter thereby generating interest income.

Other income increased $6,000 over the same period last year.

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

Cash  needs for the first six  months of 1997 were met  primarily  by short term
borrowing on the  Company's  line of credit during the first three months of the
year along with cash flow provided from operating  activities  during the second
quarter.  During the period, the Company was able to reduce short term borrowing
by $75,000 and end the period with no borrowing  on its line of credit.  Capital
expenditures  decreased  by $45,000 over the same period in 1996 while long term
debt was reduced by  $169,000.  During the same  period  last year,  the Company
increased short term borrowing by $575,000 along with reducing long term debt by
$169,000.

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 check float and provides for overnight  investment of
available funds when line of credit borrowing is zero.

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,  was  approved for renewal
with borrowing  capability  increasing from $2.5 million to $5.0 million. At the
same  time,  a pricing  modification  to the  Company's  term loan was agreed to
allowing  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 of the opinion that the revised  covenants are in line
with the increased borrowing available to the Company.









                                      -12-
<PAGE>
  Cautionary Statement for the 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 the 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.   Under utilization 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.


                                      -13-
<PAGE>
12.  Loss or retirement of key executives.

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.





































                                      -14-
<PAGE>
                           Environment One Corporation
                                   FORM 10-QSB


                           Part II - Other Information


Item 1. Legal Proceedings

In the second  quarter of 1997,  the Company  was served  with a complaint  by a
former distributor,  Abaxial  Associates,  Inc., who was terminated for cause in
1996. The action was filed in the Ontario Court of Justice  (General  Division),
in  Toronto,  Canada.  Prior to  termination,  Abaxial  Associates,  Inc.  was a
distributor  for the  Company's  grinder  pumps in the Province of Ontario.  The
plaintiff's  complaint seeks monetary damages in the amount of $1,600,000,  plus
interest  and costs  based on  allegations  of  misrepresentation  and breach of
contract  relating to the Company's  termination  of its  relationship  with the
plaintiff.

Management of the Company is of the opinion that the claim, filed as a result of
termination  of the business  relationship  with Abaxial  Associates,  Inc.,  is
unsubstantiated  and  without  merit  and that the  Company  acted  properly  in
terminating  its  relationship  with  Abaxial  Associates,  Inc. The Company has
engaged  legal counsel in Toronto,  Canada and intends to vigorously  defend the
action.  Management  does not  currently  expect  the  action to have a material
impact on the results of the Company.  However,  it is possible that the results
of  operations  or cash flow of the Company in a particular  quarterly or annual
period  could  be  materially  affected  by  the  ultimate  outcome  of  pending
litigation matters.


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

On May 15, 1997 the annual meeting of shareholders  was held in Albany,  NY. The
following is the result of the  shareholders  voting relative to the election of
two (2) directors:

         Election of Directors - 3,601,054  votes were received and at least 99%
of the vote cast voted for the election of the directors on the ballot.


Immediately following the shareholders meeting the Board of Directors held their
meeting and the following Officers were elected to serve a one year term:

         Chairman of the Board                         Stephen V. Ardia

         President and Chief Executive Officer         Stephen V. Ardia

         Vice President                                David Doin

         Secretary                                     Edward J. Grogan

         Treasurer                                     Philip W. Welsh





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<PAGE>
                           Environment One Corporation
                                   FORM 10-QSB



                                   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: August 6, 1997                              By:/s/Stephen V. Ardia
                                                     -------------------
                                                     Stephen V. Ardia
                                                     Chairman, President and CEO




Date: August 6, 1997                              By:/s/Philip W. Welsh
                                                     -------------------
                                                     Philip W. Welsh
                                                     Director of Finance
                                                     Treasurer

























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