SECURITIES AND EXCHANGE COMMISSION
               Washington, DC  20549

                    FORM 10-KSB

 [X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE
          SECURITIES EXCHANGE ACT OF 1934

    For the fiscal year ended FEBRUARY 29, 2000

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
          SECURITIES EXCHANGE ACT OF 1934

           Commission file number 0-17741

                    EPOLIN, INC.
   (Name of Small Business Issuer in Its Charter)

New Jersey                                            22-2547226
(State or other jurisdiction                    (I.R.S. Employer
of incorporation or                               Identification
organization)                                            Number)

358-364 Adams Street
Newark, New Jersey                                     07105
(Address of principal                             (Zip Code)
executive offices)

Issuer's telephone number, including area code:  (973) 465-9495

Securities registered under Section 12(b) of the Exchange Act: None

Securities registered under Section 12(g) of the Exchange Act:
                     Common Stock (no par value)

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

Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B  not contained in this form, and no disclosure will
be contained, to the best of Registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-KSB or any amendment to this Form 10-KSB. [  ]

State Issuer's revenues for its most recent fiscal year:    $1,926,992

As of May 15, 2000, the aggregate market value of the Common Stock held by
non-affiliates of the Issuer (4,783,431 shares) was approximately
$1,853,580.  The number of shares outstanding of the Common Stock (no par
value) of the Issuer as of the close of business on May 15, 2000 was
11,443,355.

Documents Incorporated by Reference:  None

<PAGE>


                       PART I

Item 1. Description of Business.

Introduction

     Epolin Inc. ("Epolin" or the "Company") is a manufacturing and
research and development company which was incorporated in the State of New
Jersey on May 8, 1984. The Company is engaged in commercial production and
sale of specialty chemicals, especially certain dyes which management
believes are useful materials because they have the capability to absorb
near infrared radiation. Its principal offices are located at 358-364 Adams
Street, Newark, New Jersey 07105 and its telephone number is (973) 465-
9495.

     In April 1989, Epolin successfully completed an initial public
offering of its securities pursuant to a public offering generating net
proceeds of approximately $1,950,000. Simultaneously, upon closing of the
offering, Epolin acquired 100% of the stock of Accort Labs, Inc.
("Accort"), then an affiliated entity.

     Commencing upon completion of the Company's public offering through
January 1990, the Company's efforts were primarily devoted to the
renovation and completion of its 17,000 square foot manufacturing  and
office facility. The principal product(s) that the Company developed were
expanding polymeric coatings. The Company has since curtailed this effort
due primarily to the high cost of the product and the lower price commanded
by similar products now sold into this maturing market. The Company has
more recently established itself as a supplier of near  infrared dyes as
well as other specialty chemical products. It sells its dyes primarily to
lens manufacturers who serve as the suppliers to the laser protection
eyewear market as well as the welding market.

     Since completion of the Company's public offering, the Company's
revenues had been primarily generated through the synthesis and sale of
specialty organic chemical products. Building upon this base, the Company
singled out near infrared dye technology as a most promising product line
and has emphasized the development, manufacture and sale of these dyes to
the optical industry.

     The Company's prior emphasis on the expanding monomer technology has
been significantly modified. The expanding monomers failed to reach any
significant level of sales and sales growth because the price of UV
coatings, a major application for  the technology, had fallen dramatically
and the market could not sustain the higher pricing for the Company's
product. Research and development on expanding monomer applications was
therefore curtailed and the Company became fully committed to specialty
chemical manufacture especially to near infrared dye development,
manufacture and sales. This part of the product line has proven to be a
successful one to pursue in that the sales of  these dyes have averaged at
a growth rate of approximately 15% to 20% per year for the last five years.
No assurance can be given that such trend will continue. The Company
believes that its future lies with dye technology and is formulating long
range plans to exploit new applications for both the near infrared dyes as
well as other dyes. Paralleling the growth of the dye business, the Company
has maintained a level of production and sales of specialty products made
on a custom basis. These include additives for plastics, thermochromic
materials for use in paints as well as other specialty chemicals made in
low volume to sell at prices that reflect the value of the product. A
discussion of this market is described in the first subsection that
follows. Thereafter the current market for dyes are described as well as
the newer  applications which will be the basis for new markets for dyes.

     In July 1997, the Board of Directors of Epolin approved a plan of
merger (the "Plan") wherein Epolin's wholly-owned subsidiary, Accort, would
merge into Epolin.  The effective date of the Plan was deemed to have
occurred as of the beginning of fiscal 1998.  The merger was approved by
the State of New Jersey as of December 30, 1998.  As a result, Accort's
assets, liabilities and stockholders' equity as of March 1, 1997 were
transferred to Epolin.

     The Company's wholly-owned subsidiary, Epolin Holding Corp. ("Epolin
Holding"), was incorporated in the State of New Jersey as a real estate
holding company.  Prior to being acquired by the Company in January 1998,
it was owned and controlled by Murray S. Cohen and James Ivchenko (officers
and directors of the Company).

     This report contains certain forward-looking statements and
information relating to the Company that are based on the beliefs and
assumptions made by the Company's management as well as information
currently available to the management.  When used in this document, the
words "anticipate", "believe", "estimate", and "expect" and similar
expressions, are intended to identify forward-looking statements.  Such
statements reflect the current views of the Company with respect to future
events and are subject to certain risks, uncertainties and assumptions.
Should one or more of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results may vary materially
from those described herein as anticipated, believed, estimated or
expected.  The Company does not intend to update these forward-looking
statements.

Specialty Chemical Products

     Although the Company is heavily engaged in the manufacture and sale
of dyes,  specialty chemical manufacture continues to constitute
approximately 22% of its sales.  It is currently working on the preparation
and sale of a variety of specialty chemical products on behalf of companies
that sell into the adhesives, plastics, aerospace,  pharmaceutical and
flavors and fragrance industries.  The Company's products primarily serve
as intermediates, additives and process aids for complex chemical
formulations. The Company markets its products to other companies who are
in need of low level quantities of unique chemicals which provide
specialized functions and are necessary elements in complex chemical
mixtures manufactured by the Company's respective customers. These products
are produced on a low volume basis in chemical production equipment ranging
from 50 liter size flasks to two hundred gallon reactors. The Company
sustains this business because its customers find it economically
inefficient to manufacture such low volume specialty chemicals for their
own use. Raw materials utilized in connection with the preparation of
specialty chemical products are either available from chemical suppliers or
made by the Company in its own facilities.

     This segment of the Company's business is manufactured on an
individual basis to meet each customers respective needs. Presently, the
Company provides products used as components in plastics, process aids,
adhesives and coatings, flavors and odorant mixtures, pharmaceutical and
medical products and aerospace materials.

     Although the specialty chemical business currently commands
approximately 22% of total sales, the Company does not expect this segment
of its business to grow. It has, instead, made a strong research and
development commitment to the growth of the specialty dye business. This
market is described in segments in the following subsections.

Dyes for Laser Protection

     The Company has sold near infrared dyes since 1990 to customers who
manufacture and sell eyewear to protect personnel from the harmful effects
of laser light. In the first stages of the Company's marketing efforts, the
Company sold dyes that had a special capability to absorb the emissions of
the neodynium-YAG laser. This laser was and is used by the military for
range finders carried by tanks. Following the Company's success in selling
dyes for military usage, new markets were developed selling to
manufacturers of safety eyewear for personnel who worked with lasers or
were exposed to very strong  sources of infrared  radiation.

     The Company sells dyes into a market that requires the use of
absorptive dyes for face shields, helmets and goggles to protect personnel
from the harmful effects of radiation from welding. Nationally prescribed
specifications now state that welding shields must absorb specific levels
of the infrared generated by the welding arc in order to protect personnel
from eye damage. The specifications have come about because a number of
studies had shown that excessive infrared  radiation can cause the
development of premature cataracts. Thus, for different levels of
protection, a specific reduction of ultraviolet, visible and infrared
emissions are now required. As a result, the Company now offers a line of
dyes for welding  that  absorb the entire range of welding radiation.
Management believes many welding customers and potential customers are
attracted to the Company's dyes because they had been tied to dye suppliers
who would only sell the dyes if the customer were to purchase the suppliers
resin or formulated resin. Freedom to formulate any resin and do in plant
injection molding of lenses or shields, has significant cost implications
for these customers. The availability of the Company's dyes has allowed the
Company to gain new customers. The Company expects to see this welding
market grow in the future not only because of increased sensitivity to the
health effects of conventional welding methods but also because of the
increasing use of lasers for welding. These instruments will require closer
monitoring for exposure of personnel to laser light but will also require
personnel peripheral to the welding operation to be protected.

Dyes for Sun Protection

     There have been various reports that near infrared radiation causes
slow but long term damage to the eye leading to premature cataracts.
Certain customers incorporate the Company's dyes into premium sunglasses to
sell at premium pricing.  An additional value in sunglasses containing near
infrared dyes is that there is a noticeable heat reduction on the eye which
allows long term use in the sun.  Management believes that this reduces
problems associated with discomfort due to perspiration around the eye.

Dyes for Filters

     A smaller but not well characterized market exists for filters that
block certain frequencies in the near infrared and visible spectrum. Most
of the inquiries come from instrument makers who purchase glass filters
containing rare earth oxides. These filters are expensive and are subject
to chipping, shattering and other breakage. Management believes the use of
a clear plastic filter containing the Company's dyes would lower cost and
increase reliability. This high value added market is under development.
No assurance can be given that the Company will be able to successfully
develop this market.

Dyes for Heat Shields

     It has been shown in experimental and theoretical studies that a
window containing near infrared dyes is capable of reducing the internal
heat load of a structure by 40 to 50 percent. This type of  application of
infrared dyes is reported in use for sun roofs of automobiles in Japan. The
specific advantage offered by near infrared dyes is heat reduction coupled
with good visible transparency. This allows high visibility while, at the
same time, effectively blocking the frequencies responsible for
transporting heat. Management believes near infrared dyes can be
effectively used in a wide variety of applications  as heat shields.  The
Company has set its sights on this potential market by initiating research
and development studies leading to dyes or dye combinations that  can meet
the tight requirements demanded by this market. Of particular concern to
the Company is the need for  long term performance which, at a minimum,
requires a working lifetime of seven years exposure to  direct sunlight. By
developing dyes of greatly improved thermal and ultraviolet stability, the
Company believes it can meet the long term exposure requirements for heat
shields.  The Company further believes that of particular importance is the
ability of these new dyes to be used in the manufacture of extruded
engineering plastic products.  Known near infrared dyes do not possess the
thermal stability to survive processing of large extruded structures.  The
Company believes that it can demonstrate that these new dyes offer a degree
of freedom in plastics processing and that this can represent an important
developing market.  No assurance can be given, however, that the foregoing
can be demonstrated, or if demonstrated, that the Company will be able to
successfully develop this market.

Dyes for Security Inks

     Certain of the near infrared dyes absorb very little of the visible
spectrum. These can be used at low concentration in inks and paints and not
be visually detected. However, when viewed by reflection of an infrared
laser or lamp, the presence of dye is easily seen as a black marking.
Mechanical "readers" can be used to detect the presence of dyes by
responding with a simple "go, no-go" signal. Management believes that the
industrial security and currency marking is  potentially a large volume
application for these dyes.  No assurance can be given that the Company
will be able to successfully develop this market.

Dyes for Interlayer and Laminates

     One of the most abrasion resistant surfaces is that of glass.  The
Company has found that the interlayer used for glass to glass laminates can
incorporate dyes and bond to the glass strongly.  These laminated glass
structures can perform like the plastic heat shields described above.  The
Company believes that such laminated glass structures have the added
advantage of abrasion resistance and in automotive applications, are
shatter-proof.  The Company is pursuing markets for laminates as shatter-
proof windshield and sun roofs.  No assurance can be given that the Company
will find a successful developer in this market.

Effect of Compliance With Government Regulation

     Manufacturers of chemical products are subject to extensive Federal
and State environmental regulations. Although the Company believes that its
manufacturing processes do not result in the emission of volatile organic
vapors into the atmosphere, and that the Company is not  in violation of
any State or Federal environmental regulations, the Company is required to
comply with such regulations with respect to manufacture, storage and/or
disposal of toxic materials. To the Company's knowledge, it is in
compliance with present regulations.  However, no assurances can be given
that future regulations will not be adopted, compliance with which will
result in substantial expense to, and otherwise adversely affect the
Company's business. In addition, the Company is subject to the State of New
Jersey Industrial Site Recovery Act (ISRA), which, among other
requirements, requires the Company to obtain prior approval before
relocating its facilities or consummating a transaction that would result
in a change in control of the Company. The Company's facilities are subject
to inspection to ascertain whether the Company has complied with State
environmental regulations.  While the Company believes it has complied with
such regulations, there can be no assurance that the Company will not be
required to incur expenses to remedy any future environmental violations
discovered. The Company is in the process of registering certain new and
proprietary products with the Toxic Substances Control Agency (TSCA) which
is required in order for the Company to offer for sale any new chemical
product.  No assurances can be given that such registrations will be
approved.

Research and Development

     The Company has made a commitment of resources to research and
development for new dyes and for improvement of the Company's capability to
provide technical services to its dye customers. In this regard, the
Company has undertaken a dye synthesis effort to develop and produce dyes
with greatly improved thermal stability.  These dyes are now a part of the
Company's product line and sales have started to grow.  There is available
to the Company the plastic processing equipment similar to that used by the
Company's customers to extrude and injection mold plastic-dye formulations.
Management expects that this will allow the Company to better understand
its customer's problems and to design solutions.

Competition

     The Company generally experiences, in management's opinion, limited
competition in all areas of its business from some companies many of which
are larger and better financed.  At the present time, however, the Company
believes that it has a  unique position as a supplier of near infrared
dyes. Management believes that the only other suppliers of these dyes use
them as a vehicle to sell other products.  Management believes that these
companies will only sell the dye to purchasers of their resins or to those
who buy their formulated resin or their finished lenses. Such companies do
not sell the pure dye which is done by the Company. Insofar as the major
profit incentive comes from the manufacture and sale of finished product,
Management believes those companies that have the capability to formulate
dyes in resin and injection mold the formulated resin, have a strong
incentive to purchase the dye without any other requirements.  However, in
the future, other dye manufacturers may change their policy and sell dye
directly.  This will present the Company with a challenge to its pricing
structure. However, because of the Company's low overhead, it is believed
that such a challenge can be met successfully.

     The Company has also invested resources in improved processes for
the manufacture of dyes so that the Company can consider itself a low cost
producer. The research and development program has introduced a new family
of near infrared dyes that show a marked improvement in thermal and light
stability over existing dyes. The Company believes that this new family of
dyes will allow it to maintain a strong position as a dye supplier for
laser safety and welding  optical wear.

Technological Obsolescence

     The chemical and plastics industry is characterized by rapid
technological changes. Although the near infrared dyes that form the major
portion of the Company's product line have been used in protective eyewear
since 1976, the field has proven to be an active one for other applications
and the Company must anticipate competition to develop.  To remain
competitive, the Company has committed itself to make capital investments
to maintain its position as a key dye supplier in this field. There can be
no assurance that the Company's dye technology will not be rendered less
competitive, or obsolete, by the development by others of new methods to
achieve laser safety and other forms of eye protection.  Furthermore, to
remain competitive, the Company may be required to make large, ongoing
capital investments to develop and produce dyes at competitive prices.
There is no assurance that can be given that the funds for such investments
will be available to the Company.

Patents and Proprietary Protection

     The Company does not rely upon patents for protection of its dye
business. It has, however, anticipated the need for such proprietary
protection and has acted by applying for patents on a class of new dyes
that it has developed.  In connection therewith, a patent was recently
granted by the U.S. Patent Office (U.S. Patent 5,686,639) for a new class
of quinone diimmonium salts in November 1997.  Other patent disclosures
have been submitted and the Company intends to prepare appropriate
applications as it deems necessary in the future.  No assurance can be
given that other patents with regard to the foregoing will be issued. The
Company has allowed its patent position on two patents it owns on Expanding
Monomers to lapse by not paying the maintenance fees. This will have no
material impact on the Company's business since the Company decided
previously to curtail the development of this technology.  The Company
intends to continue an intensive patent program on new dyes, especially in
those instances where composition of matter claims can be obtained. There
can be no assurance that these patents will be of commercial benefit to the
Company, or otherwise offer the Company protection from competing products.
Although the issuance of a patent entitles the owner to a statutory
presumption of validity, the presumption is not conclusive as to validity
or the scope of enforceability  of the claims therein. The enforceability
and validity of a patent can be challenged by litigation after its issuance
and, if the outcome of litigation is adverse to the owner of the patent,
other parties may be free to use the subject  matter covered by the patent.
Moreover, the cost of defending these patents against infringement could
require substantial expenditures which the Company may decide it is unable
to afford. In addition, persons or entities may have filed patent
applications and may have been issued patents on inventions or otherwise
possess proprietary rights to technologies potentially useful to the
Company. There can be no assurance that others may not independently
develop the same, similar or alternative technologies or otherwise obtain
access to the Company's proprietary technologies.

Sales

     A material portion of the Company's business is dependent on certain
customers, the loss  of which could have a material effect on operations.
During the year ended February 29, 2000, approximately 46.9% of sales were
to four customers.  Three of these customers comprised 35.14% of sales at
February 29, 2000. During the year ended February 28, 1999, approximately
52.76% of sales were to four customers, two of which totaled 32.39%.  Three
of these customers comprised 32.39% of sales at February 28, 1999.

Employees

     The Company presently employees approximately eight persons, all on
a full time basis of which approximately four are employed in manufacturing
and production, two in research and development, one in sales and marketing
and one in administration and supervision. The Company's employees are not
represented by labor unions.

Item 2. Description of Property.

     The Company presently occupies approximately 19,500 square feet of
manufacturing, warehouse and administrative space in Newark, New Jersey
which property the Company has occupied since June 1989.  Prior to October
1996, the Company occupied approximately 17,000 square feet of such space.
During fiscal 1996, Management decided to explore the possibility of
purchasing said property from its then owner, a non-affiliated entity which
purchase would include such additional space of approximately 2,500 square
feet.  In order to finance the purchase, the Company was advised by its
proposed lender that the members of the Company's Board of Directors would
be required to guarantee the repayment of any financing.  At a meeting of
the Board of Directors held in June 1996, only Murray S. Cohen and James
Ivchenko, each an officer and director of the Company, agreed to
participate in any such arrangement.  It was agreed that Dr. Cohen and Mr.
Ivchenko, or an entity to be formed by them, would purchase the property
and lease the property to the Company under a long term arrangement.  As a
result, Dr. Cohen and Mr. Ivchenko entered into an agreement to purchase
the property for the sum of $450,000, which agreement was prior to closing
assigned to Epolin Holding Corp. ("Epolin Holding") a company formed by Dr.
Cohen and Mr. Ivchenko to acquire the property. Such purchase was completed
in October 1996.  Simultaneously with the closing, the Company entered into
substantially similar leasing arrangements with Epolin Holding as then
existed with the former owner of the property.  Such new lease expires in
October 2001 (with three 5 year options) with annual rent of $97,740
subject to annual adjustments based on increases in the Consumer Price
Index.   Such  rent  includes  real estate taxes and insurance expenses.
In January 1998, Epolin Holding became a wholly-owned subsidiary of Epolin.

Item 3. Legal Proceedings.

     There are no material pending legal proceedings to which the Company
is a party or to which any of its property is subject.

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

     No matter was submitted during the fourth quarter of the fiscal year
covered by this report to a vote of security holders.




                      PART II

Item 5.   Market for Common Equity
          and Related Stockholder Matters.

     (a)  Market Information.

     The Company's Common Stock is presently being traded in the over-
the-counter market under the symbol "EPLN" and is listed on the OTC
Bulletin Board.  The following chart sets forth the range of the high and
low bid quotations for the Company's Common Stock for each period
indicated.  The quotations represent prices between dealers and do not
include retail markups, markdowns, commissions or other adjustments and may
not represent actual transactions.

Period                                           Bid Prices

Fiscal year ended February 28, 1999:         High           Low

March 1, 1998 to May 31, 1998                $.44           $.1875
June 1, 1998 to Aug. 31, 1998                $.34           $.15
Sept. 1, 1998 to Nov. 30, 1998               $.20           $.08
Dec. 1, 1998 to Feb. 28, 1999                $.22           $.15

Fiscal year ended February 29, 2000:         High           Low

March 1, 1999 to May 31, 1999                $.24           $.19
June 1, 1999 to Aug. 31, 1999                $.31           $.19
Sept. 1, 1999 to Nov. 30, 1999               $.31           $.23
Dec. 1, 1999 to Feb. 29, 2000                $.8125         $.24

     (b)  Holders.

     As of May 15, 2000 there were approximately 305 record holders of
the Company's Common Stock.

     (c)  Dividends.

     The Company has never declared any cash dividends on its Common
Stock and does not anticipate declaring cash dividends in the foreseeable
future.

Item 6. Management's Discussion and Analysis or Plan of Operation.


     The following discussion of the Company's financial condition and
results of operations is based on the Company's Consolidated Financial
Statements and the related notes thereto.

Overview

     Epolin, Inc. is a manufacturing and research and development company
which was incorporated  in the State of New Jersey in May 1984.   The
Company is principally  engaged in the development, production and sale of
near infrared dyes to the optical industry for laser protection and for
welding applications and other dyes, specialty chemical products that serve
as intermediates and additives used in the adhesive, plastic, aerospace,
pharmaceutical, flavors and fragrance industries to a group of customers
located in  in the United States and throughout the world.

Results of Operations

     Fiscal 2000 Compared to Fiscal 1999

     During the year ended February 29, 2000, the Company reported sales
of approximately $1,927,000 as compared to sales of approximately
$1,681,000 during the year ended February 28, 1999, an increase of
approximately $246,000 or 14.6%.  This increase in sales was primarily
attributable to an increase in sales of the Company's near infrared
absorbing dyes, and increases in sales of new dyes for new applications.

     Operating income for fiscal 2000 increased to approximately $680,000
as compared to operating income of approximately $280,000 for fiscal 1999,
an increase of approximately $400,000.  This change resulted primarily from
an increase in sales as well as decreases in cost of sales and decreases in
selling, general and administrative expenses.  Cost of sales in fiscal 2000
was approximately $501,000 compared to cost of sales in fiscal 1999 of
approximately $671,000.  In fiscal 2000, the Company's selling, general and
administrative expenses were approximately $746,000 as compared to selling,
general and administrative expenses of approximately $731,000 for the
fiscal year ended February 28, 1999.

     During the fiscal year ended February 29, 2000, the Company realized
approximately $50,000 in interest income as compared to approximately
$27,000 in interest income for the prior year.  This increase resulted
primarily from increases in available cash in fiscal 2000.

     During the fiscal year ended February 29, 2000, the Company reported
income before taxes of approximately $730,000 as compared to income before
taxes of approximately $307,000 for the fiscal year ended February 28,
1999.  Net income after taxes was approximately $380,000 or $.03 per share
for fiscal 2000 as compared to net income after taxes of approximately
$148,000 or $.01 per share for fiscal 1999.

     Fiscal 1999 Compared to Fiscal 1998

     During the year ended February 28, 1999, the Company reported sales
of approximately $1,681,000 as compared to sales of approximately
$1,602,000 during the year ended February 28, 1998, an increase of
approximately $79,000 or 4.9%.  This increase in sales was primarily
attributable to a small increase in sales of the Company's near infrared
absorbing dyes, and small increases in sales of new dyes for new
applications.

     Operating income for fiscal 1999 decreased to approximately $280,000
as compared to operating income of approximately $383,000 for fiscal 1998,
a decrease of approximately $103,000.  This change resulted primarily from
increases in selling, general and administrative expenses and increases in
cost of sales, partially offset by an increase in sales.  Cost of sales in
fiscal 1999 was approximately $671,000 compared to cost of sales in fiscal
1998 of approximately $492,000.  In fiscal 1999, the Company's selling,
general and administrative expenses were approximately $731,000 as compared
to selling, general and administrative expenses of approximately $727,000
for the fiscal year ended February 28, 1998.

     During the fiscal year ended February 28, 1999, the Company realized
approximately $27,000 in interest income as compared to approximately
$22,000 in interest income for the prior year.  This increase resulted
primarily from increases in available cash in fiscal 1999.

     During the fiscal year ended February 28, 1999, the Company reported
income before taxes of approximately $307,000 as compared to income before
taxes of approximately $406,000 for the fiscal year ended February 28,
1998.  Net income after taxes was approximately $148,000 or $.01 per share
for fiscal 1999 as compared to net income after taxes of approximately
$305,000 or $.03 per share for fiscal 1998.

Liquidity and Capital Resources

     On February 29, 2000, the Company had working capital of
approximately $1,694,000, an equity to debt ratio of 3.16 to 1, and
stockholders' equity of approximately $2,027,000.  On February 29, 2000,
the Company had approximately $1,183,000 in cash and cash equivalents,
total assets of approximately $2,669,000 and total liabilities of
approximately $642,000.   The Company believes that its available cash,
cash flow from operations and projected revenues will be sufficient to fund
the Company's operations for at least the next 12 months.

     The Company does not anticipate making any significant additional
capital expenditures in the immediate future as it believes its present
machinery and equipment will be sufficient to meet its near term needs.

     Inflation has not significantly impacted the Company's operations.

Year 2000 Issue

     The Year 2000 issue is the result of computer programs having been
written using two digits, rather then four, to define the applicable year.
Software programs and hardware that have date-sensitive software or
embedded chips may recognize a date using "00" as the year 1900 rather than
the year 2000.  This could result in a major system failure or
miscalculations causing disruptions of operations, including a temporary
inability to engage in normal business activities.

     Prior to the year 2000, the Company determined that its critical
software (primarily widely-used software packages) and all of its critical
business systems, including manufacturing instrumentation, were already
year 2000 compliant, and as of the date of this report, no significant
problems had been encountered.  However, there can be no assurance that
this will continue to be the case, and there are also continuing risks to
the Company's operations from year 2000 failures by third parties, such as
suppliers.  In this regard, the Company continues to monitor the situation.

     The Company previously initiated communications with third parties
with whom the Company has material direct and indirect business
relationships in order to determine the extent to which the Company's
business is vulnerable to the third parties' failure to make their systems
year 2000 compliant.  Based upon the  information gathered from such other
third parties, the Company is not aware of any material third party year
2000 risks which have not been resolved.  As of the date of this report,
the Company has not experienced any significant year 2000 issues arising
from third parties.  The Company continues to maintain close contact with
critical suppliers with respect to such third parties' year 2000 compliance
and any year 2000 issues that might arise at a later date.

     The Company currently does not have a contingency plan in the event
year 2000 issues arise at a future date.  Such a plan will be developed if
it becomes necessary.  Although no assurance can be given that there will
be no interruption of operations due to year 2000 issues, the Company has
not to date suffered any significant problems and believes that it has
reasonably assessed all of its systems in order to ensure that the Company
will not suffer any material adverse effect in the future.

     The Company has used and will continue to use, if necessary,
internal resources to resolve its year 2000 issue. Costs incurred to date
by the Company have not been material and the Company estimates that the
total cost of these programs to date was less than $60,000.  No further
substantial expenditures are currently planned.

Other Information

     In March 1998, the Board of Directors of the Company authorized a
stock repurchase program of up to $150,000 of the Company's outstanding
shares of Common Stock. In connection therewith, the Company announced that
purchases may be made in the open market or in privately negotiated
transactions from time to time, based on market prices and that the
repurchase program may be suspended without further notice. Management
believes the Company's shares are undervalued at current price levels and
this program offers the Company a chance not only to repurchase some of its
stock at prices management perceives to be attractive but it also enables
the Company to enhance shareholder value although no assurance can be given
that any such repurchases will have such effect.   A total of 470,700
shares have been repurchased under this program through February 29, 2000
at a cumulative cost of $118,906, which includes 315,700 shares repurchased
during the fiscal year ended February 29, 2000 at a cost of $84,822.

Item 7. Financial Statements.

     See the Consolidated Financial Statements annexed to this report.

Item 8. Changes in and Disagreements with Accountants
        on Accounting and Financial Disclosure.

     None.



                      PART III

Item 9.  Directors, Executive Officers, Promoters and Control
         Persons; Compliance with Section 16(a) of  the Exchange Act.

     Set forth below are the present directors and executive officers of
the Company.  Note that there are no other persons who have been nominated
or chosen to become directors nor are there any other persons who have been
chosen to become executive officers.  There are no arrangements or
understandings between any of the directors, officers and other persons
pursuant to which such person was selected as a director or an officer.
Directors are elected to serve until the next annual meeting of
stockholders and until their successors have been elected and have
qualified.  Officers serve at the discretion of the Board of Directors.

                             Present Position     Has Served As
Name                Age      and Offices          Director Since

Murray S. Cohen     75       Chairman of the          1984
                             Board, Chief Executive
                             Officer and Director

James Ivchenko      60       President                1993
                             and Director

Chester C. Swasey   56       Vice President of        1994
                             Sales and Marketing,
                             Secretary and Director

Claire Bluestein    74       Director                 1984

Morris Dunkel       72       Director                 1984

Abdelhamid A.H.
Ramadan             60       Director                 1994

     None of the directors and officers is related to any other director
or officer of the Company.

     Set forth below are brief accounts of the business experience during
the past five years of each director and executive officer of the Company
and each significant employee of the Company.

     MURRAY S. COHEN has served as Director, Chief Executive Officer and
Chairman of the Board of the Company since June 1984.  From June 1984 to
August 1994, Dr. Cohen was also President.  From January 1978 through May
1983, Dr. Cohen was the Director of Research and Development for Apollo
Technologies Inc., a company engaged in the development of pollution
control procedures and devices.  Dr. Cohen was employed as a Vice President
and Technical Director of Borg-Warner Chemicals from 1973 through January
1978, where his responsibilities included the organization, project
selection and project director of a 76 person technical staff which
developed materials for a variety of plastic products.  He received a
Bachelor of Science Degree from the University of Missouri in 1949 and a
Ph.D. in Organic Chemistry from the same institution in 1953.

     JAMES IVCHENKO has served as Director of the Company since September
1993, President since August 1994, and from February 1992 to August 1994,
he was Technical Director and Vice President of Operations.  Prior thereto,
Mr. Ivchenko was employed by Ungerer & Co. as Plant Manager for the Totowa,
New Jersey and Bethlehem, Pennsylvania facilities from May 1988 to May
1991.  Mr. Ivchenko has over 30 years of experience in the flavor,
fragrance and pharmaceutical intermediate industry.   He received his
Bachelor of Arts Degree, Masters of Science and Masters of Business
Administrations from Fairleigh Dickinson University in New Jersey.

     CHESTER C. SWASEY has served as Director of the Company since 1994
and Vice President of Sales and Marketing since August 1994.  From 1992 to
1994, Mr. Swasey was employed as a Director of Marketing at Fairmount
Chemical Company.  From 1989 to 1992, he was employed as Manager of New
Business Development at Union Carbide Corporation. Mr. Swasey has received
several United States patents and has published a variety of technical
papers related to the performance of plastics additives.  Mr. Swasey
received a Bachelor of Science degree in Chemistry from the City College of
New York in 1965, and a Master of Business Administration degree from
Fairleigh Dickinson University in 1973.

     CLAIRE BLUESTEIN has served as Director of the Company since June
1984.  Since 1976, Dr. Bluestein has been president and sole shareholder of
Captan Associates, Inc., a company engaged in the development of materials
for commercial applications of radiation curing technology.  Dr. Bluestein
has been issued several patents by the United States Department of
Commerce, Trademark and Patent Offices and has published a variety of
chemistry related articles.  Dr. Bluestein received her Bachelor of Arts
Degree from the University of Pennsylvania in 1947.  In 1948 she received a
Master of Science Degree and in 1950 a Ph.D. in Organic Chemistry from the
University of Illinois.

     MORRIS DUNKEL has served as Director of the Company since June 1984.
From 1976 through 1983, Dr. Dunkel was employed by Tenneco Chemicals, Inc.,
a firm engaged in chemical production activities, in the capacities of
manager and director of Tenneco's organic chemicals research and
development division.  Dr. Dunkel has been issued several United States
patents and has published numerous articles relating to chemical processes.
He received a Bachelor of Science Degree in 1950 from Long Island
University.  Dr. Dunkel received a Master of Science Degree from Brooklyn
College in 1954 and Ph.D. in Organic Chemistry from the University of
Arkansas in 1956.

     ABDELHAMID A.H. RAMADAN has been a Director of the Company since
July 1994, and has served as Manager for Research, Process Development and
Quality Assurance of the Company since November 1993.  From March 1992
through October 1993, he served as production manager at Celgene Corp., and
from 1989 through February 1992, he served as Senior Chemist and Chemical
Hygiene Officer of the Company.  From 1982 through 1988, Mr. Ramadan served
as Production Department Head at Tenneco Chemicals.  Mr. Ramadan received a
Bachelor of Science Degree in Chemistry in 1963 from Ain Shams University -
Cairo - Egypt.

Item 10.  Executive Compensation.

     The following summary compensation tables set forth information
concerning the annual and long-term compensation for services in all
capacities to the Company for the fiscal years ended February 29, 2000,
February 28, 1999 and 1998, of those persons who were, at February 29, 2000
(i) the chief executive officer and (ii) the other most highly compensated
executive officers of the Company, whose annual base salary and bonus
compensation was in excess of $100,000 (the named executive officers):


Summary Compensation Table

                        Annual
                        Compensation


Name and Principal    Fiscal
Position              Year       Salary(1)     Bonus

Murray S. Cohen       2000       $127,874      $20,000
Chairman of the       1999       $111,538      $20,000
Board and Chief       1998       $ 89,575      $20,000
Executive Officer

James Ivchenko        2000       $123,502      $15,000
President             1999       $106,538      $15,000
                      1998       $ 95,771      $15,000


Chester C. Swasey     2000       $101,223(2)   $     0
Vice President of     1999       $ 94,504(2)   $ 5,000
Sales and Marketing   1998       $ 89,903(2)   $ 5,000



                              Long-Term
                              Compensation

                                 Restricted     Shares
Name and Principal    Fiscal     Stock          Underlying
Position              Year       Awards         Options

Murray S. Cohen       2000           0              0
Chairman of the       1999           0          75,000
Board and Chief       1998           0              0
Executive Officer

James Ivchenko       2000            0              0
President            1999            0          75,000
                     1998            0              0


Chester C. Swasey    2000            0              0
Vice President of    1999            0          75,000
Sales and Marketing  1998            0              0


(1)  Does not include any deferred compensation arrangements for such
     officers, as well as additional compensation due to Murray S. Cohen
     and James Ivchenko based upon the Company's sales for fiscal 2000 as
     determined under their employment contracts which will be in the
     amount of $38,540 and $28,905, respectively.

(2)  Includes commissions to Mr. Swasey.

Stock Option Plans

     The Company previously adopted the 1986 Employees' Stock Option Plan
(the "1986 Plan").  As of April 1996, options may no longer be granted
under the 1986 Plan.  Under the terms of the 1986 Plan, options granted
thereunder could be designated as options which qualify for incentive stock
option treatment under Section 422A of the Internal Revenue Code of 1986,
as amended (the "Code"), or options which do not so qualify.  In December
1995, options to acquire up to 490,000 shares of the Company's Common Stock
were granted under the 1986 Plan.  Such options expire on December 1, 2005.
To date, options to acquire 270,000 shares of the Company's Common Stock
have been exercised under the 1986 Plan.    The Company has repurchased
120,000 of such shares which were acquired upon exercise.

     In December 1998, the Company adopted the 1998 Stock Option Plan
(the "1998 Plan") for employees, officers, consultants or directors of the
Company to purchase up to 750,000 shares of Common Stock of the Company.
Options granted under the 1998 Plan shall be non-statutory stock options
which do not meet the requirements of Section 422 of the Code.  Under the
terms of the 1998 Plan, participants may receive options to purchase Common
Stock in such amounts and for such prices as may be established by the
Board of Directors or a committee appointed by the Board to administer the
1998 Plan.  As of February 29, 2000, options to acquire 475,000 shares of
the Company's Common Stock have been granted under the 1998 Plan and
275,000 options were available for future grant. .  To date, options to
acquire 12,500  shares of the Company's Common Stock have been exercised
under the 1998 Plan.    The Company has repurchased all of such shares
which were acquired upon exercise.

     No stock options or other stock appreciation rights were granted to
any of  the persons named in the Summary Compensation Table during the
fiscal year ended February 29, 2000.

     The following table set forth certain information as to each
exercise of stock options during the year ended February 29, 2000, by the
persons named in the Summary Compensation Table and the fiscal year-end
value of unexercised options:

Aggregated Option Exercises in Fiscal 1999 and Year-End Option Value

                                          Number of Securities
                     Shares               Underlying Unexercised
                     Acquired             Options at February 29, 2000
                     On         Value
                     Exercise   Realized  Exercisable  Unexercisable

Murray S. Cohen      -0-        -0-        112,500       37,500
James Ivchenko       -0-        -0-        112,500       37,500
Chester C. Swasey    -0-        -0-        112,500       37,500



                    Value of Unexercised
                    In-the-Money Options
                    at February 29, 2000(1)
                    Exercisable    Unexercisable

Murray S. Cohen     $71,250        $21,000
James Ivchenko      $71,250        $21,000
Chester C. Swasey   $71,250        $21,000

________________________

(1)   Realizable values are reported net of the option exercise price but
before any income taxes that the executive may have to pay.  Actual gains,
if any, on stock option exercises are dependent on the future performance
of the Common Stock as well as the option holder's continued employment
through the vesting period.  The amounts reflected in this table may never
be obtained.

Compensation of Directors

     Since inception, no director has received any cash compensation for
his services as such. In the past, directors have been and will continue to
be reimbursed for reasonable expenses incurred on behalf of the Company.

Deferred Compensation/Employment Contracts

     Pursuant to a deferred compensation agreement, as amended, entered
into with James Ivchenko, President of the Company, the Company has agreed
to pay Mr. Ivchenko $32,000 per year for ten consecutive years commencing
the first day of the month following Mr. Ivchenko reaching the age of 65.
The obligation is being funded with a life insurance policy owned by the
Company.

     Effective as of March 1, 1999, the Company entered into a ten year
employment agreement with Mr. Ivcheko.  Pursuant thereto, Mr. Ivchenko
shall be paid an annual salary of not less than the greater of his annual
base salary in effect immediately prior to the effective date of the
agreement or any subsequently established annual base salary. In addition
thereto, Mr. Ivchenko shall receive as additional compensation a certain
percentage (as set forth below) of the Company's annual gross sales up to
but not exceeding annual gross sales of $3 million.  Such percentage starts
at 1.50% for the fiscal year ended February 29, 2000 and increases by 0.25%
per year during the term of the agreement.  In the event of death or
disability, the agreement provides that Mr. Ivchenko or his estate will
receive 100% of his annual salary and additional compensation as described
above for the fiscal year during which he died or became disabled, and 50%
of his annual  salary and annual additional compensation which he would had
received (if not for his death or disability) for the remainder of the ten
year term.

     Effective as of March 1, 1999, the Company also entered into a  ten
year employment agreement with Murray S. Cohen, Chairman of the Board and
Chief Executive Officer of the Company.  Pursuant thereto, Dr. Cohen shall
be paid an annual salary of not less than the greater of his annual base
salary in effect immediately prior to the effective date of the agreement
or any subsequently established annual base salary. In addition thereto,
Dr. Cohen shall receive as additional compensation a certain percentage (as
set forth below) of the Company's annual gross sales up to but not
exceeding annual gross sales of $3 million.  Such percentage starts at
2.00% for the fiscal year ended February 29, 2000 and increases by 0.25%
per year during the term of the agreement.  In the event of death or
disability, the agreement provides that Dr. Cohen or his estate will
receive 100% of his annual salary and additional compensation as described
above for the fiscal year during which he died or became disabled, and 50%
of his annual  salary and annual additional compensation which he would had
received (if not for his death or disability) for the remainder of the ten
year term. The Company had previously entered into a deferred compensation
agreement with Dr. Cohen which provided for the payment of certain funds to
Dr. Cohen for a period of ten years beginning two weeks after the date of
his retirement.  Such agreement was terminated in connection with the
execution of the employment agreement with Dr. Cohen.

     The Company has also entered into deferred compensation agreements
with Chester C. Swasey and Abdelhamid A.H. Ramadan.  These agreements
provide for annual payments of 50% of each employee's salary before bonuses
at his respective retirement dates, to be paid in biweekly installments for
10 years.

Item 11.  Security Ownership of Certain Beneficial Owners and Management.

     The following table sets forth, as May 15, 2000, certain information
with regard to the record and beneficial ownership of the Company's Common
Stock by (i) each stockholder owning of record or beneficially 5% or more
of the Company's Common Stock, (ii) each director individually, (iii) all
officers and directors of the Company as a group:

                        Amount and Nature of   Percent
Name                    Beneficial Ownership   of Class

Murray S. Cohen(1)(2)*  2,808,458              24.3%
James Ivchenko(1)*      1,682,087              14.6%
Chester C. Swasey(3)*     963,322               8.4%
Claire Bluestein(4)*      957,655               8.3%
Morris Dunkel(4)*         212,500               1.9%
Abdelhamid R.H.
Ramadan(3)*               360,902               3.1%

All Officers
and Directors
as a Group (6 persons)  6,984,924              59.4%

*    Indicates a Director of the Company.  The address for each is 358-
     364 Adams Street, Newark, New Jersey 07105.

(1)  Includes 112,500 shares which each has the right to acquire within
     60 days pursuant to the exercise of stock options granted under the
     Company's Stock Option Plans.  Does not include an additional 37,500
     shares which each does not have the right to acquire within 60 days
     pursuant to the exercise of stock options granted under the 1998
     Plan.

(2)  Includes 1,000,000 shares owned by three grandchildren of Dr. Cohen,
     which shares are held by Dr. Cohen's daughters as custodian.  Dr.
     Cohen holds a proxy with respect to such shares which proxy expires
     in August 2000.  As a result, Dr. Cohen may be deemed to be the
     beneficial owner of such shares.

(3)  Includes 37,500 shares which each has the right to acquire within 60
     days pursuant to the exercise of stock options granted under the
     1998 Plan.  Does not include an additional 37,500 shares which each
     does not have the right to acquire within 60 days pursuant to the
     exercise of stock options granted under the 1998 Plan.

(4)  Includes 12,500 shares which each has the right to acquire within 60
     days pursuant to the exercise of stock options granted under the
     1998 Plan.  Does not include an additional 12,500 shares which each
     does not have the right to acquire within 60 days pursuant to the
     exercise of stock options granted under the 1998 Plan.

Item 12.  Certain Relationships and Related Transactions.

     None.

Item 13.  Exhibits and Reports on Form 8-K.

     (a)  Exhibits.

         3.1       Epolin Inc.'s certificate of incorporation as amended (1)
         3.2       Epolin Inc.'s by-laws(1)
         4.1       Specimen certificate for common stock(1)
         ___________________
         (1)  Filed with the Company's Form S-18 Registration
              Statement SEC File 33-25405-NY.

     (b)  Reports on Form 8-K.

     Listed below are reports on Form 8-K filed during the last quarter
of the period covered by this report:

     None.


<PAGE>

                            SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

                                   EPOLIN, INC.
                                   (Registrant)



                                   By:  /s/Murray S. Cohen
                                        Murray S. Cohen,
                                        Chief Executive Officer

                                   Dated: May 30, 2000

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant, and in the capacities and on the dates indicated:

Signature              Title                        Date


/s/Murray S. Cohen     Chief Executive Officer,     05/30/00
Murray S.  Cohen       Chairman of the Board,
                       Director (Principal
                       Executive Officer and
                       Principal Financial Officer)

/s/James Ivchenko      President, Director          05/30/00
James Ivchenko

                       Vice President of
Chester C. Swasey      Sales and Marketing,
                       Secretary, Director

/s/Claire Bluestein    Director                     05/30/00
Claire Bluestein

/s/Morris Dunkel       Director                     05/30/00
Morris Dunkel

Abdelhamid A.H.
 Ramadan               Director

<PAGE>



EPOLIN, INC. AND SUBSIDIARY

FINANCIAL STATEMENTS

YEARS ENDED FEBRUARY 29, 2000
AND FEBRUARY 28, 1999


<PAGE>




CONTENTS
                                   Page


Independent Auditor's Report        1

Consolidated Financial Statements:

Consolidated Balance Sheets         2 - 3

Consolidated Statements of Income   4

Consolidated Statements
of Stockholders' Equity             5

Consolidated Statements
of Cash Flows                       6 - 7

Notes to Consolidated
Financial Statements                8 - 16


<PAGE>


INDEPENDENT AUDITOR'S REPORT


To the Board of Directors and Stockholders
EPOLIN, INC. AND SUBSIDIARY
Newark, New Jersey

     We have audited the accompanying Consolidated Balance Sheets of
Epolin, Inc. and its wholly owned Subsidiary as of February 29, 2000 and
February 28, 1999 and the related Consolidated Statements of Income,
Stockholders' Equity and Cash Flows for the years ended February 29, 2000,
February 28, 1999 and 1998.  These financial statements are the
responsibility of the Company's management.  Our responsibility is to
express an opinion on these financial statements based on our audit.

     We conducted our audits in accordance with generally accepted
auditing standards.  Those standards require that we plan and perform the
audit to obtain reasonable assurance as to whether the financial statements
are free of material misstatement.  An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation.  We believe that our audit
provides a reasonable basis for our opinion.

     In our opinion, the Consolidated Financial Statements referred to
above present fairly, in all material respects, the financial position of
Epolin Inc. and Subsidiary as of February 29, 2000 and February 28, 1999
and the results of its operations and cash flows for the years ended
February 29, 2000, February 28, 1999 and 1998 in conformity with generally
accepted accounting principles.


                                 POLAKOFF WEISMANN LEEN LLC
May 12, 2000



<PAGE>



EPOLIN, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
ASSETS

                                            February 28,
                                         2000        1999
Current assets:
 Cash and cash equivalents           $ 1,182,937   $675,728
 Accounts receivable                     288,836    330,914
 Inventories                             475,215    279,624
Prepaid expenses:
 Income taxes                               -        22,504
 Other                                    30,999     16,947
 Employee loans                            4,769     10,362
 Deferred tax assets
  -current portion                       113,577    126,854

Total current assets                   2,096,333  1,462,933

Property, plant and
 equipment - at cost:
Land                                      81,000     81,000
Building                                 369,000    369,000
Machinery and equipment                  213,606    200,162
Furniture and fixtures                    11,407     11,036
Leasehold improvements                   432,037    432,037

Total                                  1,107,050  1,093,235

Less:
  Accumulated depreciation
   and amortization                      648,937    631,514

Net property,
 plant and equipment                     458,113    461,721

Other assets:
Deferred tax assets
-non current portion                      33,975     29,253
Cash value
 - life insurance policy                  80,579     62,558

Total other assets                       114,554     91,811

Total                                  2,669,000 $2,016,465



     The accompanying notes are an integral part of these statements.

<PAGE>

EPOLIN, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS (CONTINUED)
LIABILITIES AND STOCKHOLDERS' EQUITY

                                               February 28,
                                          2000            1999
Current liabilities:
  Accounts payable                    $   17,330    $   43,404
  Accrued expenses                       162,084        51,027
  Taxes payable:
Payroll                                    1,310         1,310
Income                                   221,619        33,235

Total current liabilities                402,343       128,976

Other liabilities:
  Deferred compensation                  229,196       144,764
  Loans payable-officers                  10,319        10,319

Total other liabilities                  239,515       155,083

 Total liabilities                       641,858       284,059

Stockholders' equity:
 Preferred stock, $15.513 par value;
 940,000 shares authorized;
 none issued
 Preferred stock, series A convertible
 non-cumulative, $2.50 par value;
 redemption price and liquidation preference;
 60,000 shares authorized; 5,478 shares issued
 and redeemed
 Common stock, no par value;
 20,000,000 shares authorized;
 11,806,500 and 11,759,000 shares
 issued and outstanding at
 2000 and 1999, respectively           2,220,384     2,220,384

Paid-in capital                            6,486         6,486
Accumulated deficit                      (80,822)     (460,380)

Total                                  2,146,048     1,766,490
Less:
 Treasury stock
  -at cost                               118,906        34,084

Total stockholders' equity             2,027,142     1,732,406

  Total                             $  2,669,000    $2,016,465


      The accompanying notes are an integral part of these statements.

<PAGE>

EPOLIN, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
YEARS ENDED FEBRUARY 29, 2000 AND FEBRUARY 28, 1999 AND 1998


                                          2000         1999        1998

Sales                                $ 1,926,992   $1,681,243   1,602,150

Cost of sales and expenses:
Cost of sales                            501,437      670,793     491,960
Selling, general and administrative
 expenses                                745,743      730,816     726,990

Total                                  1,247,180    1,401,609   1,218,950

Operating income                         679,812      279,634     383,200

Other income:
Interest income                           50,080       27,304      22,487
Gain on disposal of assets                   -            -           500

Total other income                        50,080       27,304      22,987

Income before taxes                      729,892      306,938     406,187

Income taxes                             350,334      159,010     101,420

Net income                             $ 379,558     $147,928     304,767


Per share data:
Basic earnings per common share             0.03         0.01        0.03

Fully diluted earnings
 per common share                           0.03         0.01        0.03

Weighted average number of
 common shares outstanding            11,284,591   11,597,048   11,611,555



      The accompanying notes are an integral part of these statements.
<PAGE>

EPOLIN, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY


                                 Additional
                       Common    Paid-in-  Accumulated  Treasury  Stockholders'
                       Stock     Capital   Deficit      Costs     Equity



Balance -
March 1, 1997       2,216,984     6,486     (863,127)       -     1,360,343

Prior period
 adjustment               -          -       (49,948)       -       (49,948)

Net income -
Year ended
February 28, 1998         -          -       304,767        -       304,767

Balance -
February 28, 1998   2,216,984     6,486     (608,308)       -     1,615,162

Common stock issued
 for stock option       3,400        -           -          -         3,400

Net income
- Year ended
February 28, 1999          -         -       147,928        -       147,928


Less cost of
treasury stock             -         -           -      (34,084)    (34,084)

Balance -
February 28, 1999  2,220,384     6,486     (460,380)   (34,084)   1,732,406

Net income -
Year ended
February 29, 2000          -         -       379,558         -      379,558

Less cost of
treasury stock             -         -            -     (84,822)    (84,822)

Balance -
February 29, 2000 $ 2,220,384     6,486     (80,822)   (118,906)   2,027,142


      The accompanying notes are an integral part of these statements.

<PAGE>

EPOLIN, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED FEBRUARY 29, 2000 AND FEBRUARY 28, 1999 AND 1998


                                               2000      1999      1998

Cash flows from operating activities:
Net income                                  $ 379,558   147,928   304,767
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation and amortization                  17,423    62,113    61,890
Deferred tax expense                            8,555    42,817   101,125
Obligation under deferred compensation
agreement                                      84,432    50,964    20,799
(Increase) decrease in:
Accounts receivable                            42,078  (115,938)   11,548
Inventories                                  (195,591)  102,652   (40,588)
Employee loans                                  5,593    (4,496)   (5,866)
Prepaid expenses:
Income taxes                                   22,504    10,295   (22,654)
Other                                         (14,052)    6,809    (8,992)
Security deposits                                  -     12,635    24,435
Increase (decrease) in:
Accounts payable                              (26,074)    3,019    21,660
Accrued expenses                              111,057    (4,516)   22,329
Taxes payable:
Payroll                                             -      (353)   (4,834)
Income                                        188,384    33,235       150
Net cash provided by operating activities     623,867   347,164   485,769
Cash flows from investing activities:
Loans payable - officers                            -    10,319    91,601
Increase in cash value
- life insurance policy                       (18,021)  (19,881)  (18,775)
Assets from acquisition of subsidiary -
net of accumulated depreciation                     -   (20,319) (417,765)
Payments for equipment                        (13,815)      -      (4,504)

Net cash used by investing activities         (31,836)  (29,881) (349,443)

     The accompanying notes are an integral part of these statements.

<PAGE>

EPOLIN, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
YEARS ENDED FEBRUARY 29, 2000 AND FEBRUARY 28, 1999 AND 1998

                                         2000        1999      1998

Cash flows from financing activities:
Proceeds from the issuance of
 capital stock                             -         3,400        -
Purchase of treasury stock            (84,822)     (34,084)       -

Net cash used by financing activities (84,822)     (30,684)       -

Increase  in cash                     507,209      286,599    136,326

Cash and cash equivalents:
  Beginning                           675,728      389,129    252,803

  Ending                           $1,182,937     $675,728    389,129

Supplemental Information:

Income taxes paid                  $  149,649     $ 80,700     22,504

Interest paid                      $   12,279          -          -

     The accompanying notes are an integral part of these statements.

<PAGE>



EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FEBRUARY 29, 2000

NOTE A - ORGANIZATION AND BASIS OF PRESENTATION:

The Company is engaged in the development, production and sale of near
infrared dyes to the optical industry for laser protection and welding
applications and other dyes and specialty chemical products that serve as
intermediates and additives used in the adhesive, plastic, aerospace,
pharmaceutical and flavors and fragrance industries to customers located in
the United States and throughout the world.

The Company's wholly owned Subsidiary, Epolin Holding, Corp., was
incorporated in New Jersey as a real estate holding company whose asset
consist of land and a building.  Prior to being acquired on January 29,
1998, it was controlled by two officers/stockholders of the Company.

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Principles of Consolidation - The accompanying Consolidated Financial
Statements include the accounts of the Company and its Subsidiary.
Intercompany transactions and balances have been eliminated in
consolidation.  Condensed consolidating financial statements for the year
ended February 29, 2000 follows:

CONDENSED CONSOLIDATING BALANCE SHEET


                              Epolin
                    Epolin    Holding Eliminations Consolidated
Current assets    $2,359,779   19,471   (248,942)  2,130,308
Non-current assets   308,802  420,757   (190,867)    538,692
Total             $2,668,581  440,228   (439,809)  2,669,000

Total liabilities    641,439  273,796   (273,377)    641,858

Stockholders' equity:
    Common stock   2,220,384       -         -     2,220,384
    Additional paid-in
    capital            6,486       -         -         6,486
    Accumulated
    deficit          (80,822) 166,432   (166,432)    (80,822)
     Treasury
        stock       (118,906)      -         -      (118,906)

     Total stockholders'
        equity     2,027,142  166,432   (166,432)   2,027,142

           Total  $2,668,581  440,228   (439,809)   2,669,000

PAGE>



EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FEBRUARY 29, 2000

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (Continued)

CONDENSED CONSOLIDATING STATEMENT OF INCOME


                               Epolin
                 Epolin        Holding   Eliminations   Consolidated
Sales            $1,926,992      -             -         1,926,992

Other revenue         -        97,740      (97,740)          -
Total             1,926,992    97,740      (97,740)      1,926,992

Cost of sales       501,437      -             -           501,437
Selling, general
  and
  administrative    832,600    10,883      (97,740)        745,743
     Total        1,334,037    10,883      (97,740)      1,247,180

Operating income    592,955    86,857           -          679,812

Other income         50,080      -              -           50,080

Income before
taxes               643,035    86,857           -          729,882

Income taxes        340,069    10,265           -          350,334

Net income        $ 302,966    76,592           -          379,558


Cash and Cash Equivalents - Includes cash in bank and money market accounts
for purposes of preparing the Statement of Cash Flows.

Concentrations of Credit Risks - The Company has cash deposits in financial
institutions in excess of the amount insured by agencies of the federal
government in the amounts of $1,082,937 and $575,728 at February 29, 2000
and February 28, 1999, respectively.  In evaluating this credit risk, the
Company periodically evaluates the stability of these financial
institutions.

Inventories - Consists of raw materials, work in process, finished goods
and supplies valued at the lower of cost or market under the first-in,
first-out method.

Fair Value of Financial Instruments - All reported assets and liabilities,
which represent financial instruments, approximate the carrying values of
such amounts.

<PAGE>

EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FEBRUARY 29, 2000

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (Continued)

Property, Plant and Equipment - Stated at cost less accumulated
depreciation and amortization. Provisions for depreciation are computed on
the straight-line and declining balance methods, based upon the estimated
useful lives of the assets.

Depreciation and amortization expense totaled $17,423, $62,113 and $61,890
for the fiscal years 2000, 1999 and 1998, respectively.

Income taxes -The Company accounts for income taxes under Statement of
Financial Accounting Standards No. 109, "Accounting for Income Taxes",
wherein the asset and liability method is used in accounting for income
taxes.  Deferred taxes are recognized for temporary differences between the
basis of assets and liabilities for financial statement and income tax
purposes.  The temporary differences relate primarily to different
accounting methods used for depreciation and amortization of property and
equipment, allowance for doubtful accounts and net operating loss carry
forwards.

Use of Estimates - The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the amounts of sales and expenses during
the reporting period.  Actual results could differ from those estimates.

NOTE C - ECONOMIC DEPENDENCY:

A material portion of the Company's business is dependent on certain
domestic customers, the loss of which could have a material effect on
operations.  During the year ended February 29, 2000, approximately 46.9%
of sales were to four customers.   Three of these customers, located in the
Eastern United States, comprised 35.14% of sales at February 29, 2000.
During the year ended February 28, 1999, approximately 52.76% of sales were
to four customers, two of which totaled 32.39%.  Three of these customers
located in the Eastern United States comprised 32.39 of sales at February
28, 1999.

<PAGE>


EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FEBRUARY 29, 2000


NOTE D - INVENTORIES:
                                 2000      1999
Raw materials and supplies    $ 45,517    33,242
Work in process                 12,074    27,491
Finished goods                 417,624   218,891

          Total               $475,215   279,624




NOTE E - INCOME TAXES:
                                 2000       1999
1.  Federal and State deferred
    tax assets include
    the following:

    Tax effect of
    utilization of
    net operating loss
    carryforwards             $   -         32,671


    Temporary differences -
    principally accelerated
    amortization of leasehold
    improvements for
    book purposes              147,552      123,436

    Total - deferred
    tax assets                 147,552      156,107


    Current portion            113,577      126,854

    Non-current portion       $ 33,975       29,253

2.  Income tax expense consists
    of the following components:

                              2000       1999        1998
      Current
       Federal             $296,300     112,341        -
       State                 45,479       3,852       295

     Total current          341,779     116,193       295

      Deferred:
       Federal              (18,947)      9,995    66,924
       State                 27,502      32,822    34,201

        Total deferred        8,555      42,817   101,125

           Total           $350,334     159,010   101,420

<PAGE>

EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FEBRUARY 29, 2000

NOTE E - INCOME TAXES (Continued):

3.  Reconciliation of income
    tax at the statutory rate
    to the Company's effective rate:

                                        2000        1999       1998

    Computed at the statutory rate    $245,159    219,815    231,300
    State income taxes (net)            45,479      3,852        295
    Decrease in deferred tax asset
      valuation allowance               34,476        -     (113,214)

    General business creditor           (4,577)       -           -
    Non-deductible items                29,797    (64,657)   (16,961)

      Effective tax rate              $350,334    159,010     101,420

The Company does not have any net operating loss carryforwards available
for either Federal or State tax purposes.

NOTE F - ACCRUED SALARIES:


On April 25, 1995, the Board of Directors authorized the issuance of
1,000,000 shares of common stock (market value $.04 per share) to an
officer in lieu of $40,000 of his remaining accrued salary of $89,948.
The remaining unpaid balance of $49,948 was classified as deferred
compensation as of February 28, 1998.

NOTE G - EMPLOYEE BENEFITS:

Simplified Employee Pension Plan - Effective June 1, 1994, covering all
eligible participating employees as defined. Employer contributions totaled
$15,397, $12,908 and $12,141 for the years ended February 29, 2000,
February 28, 1999 and 1998, respectfully.

Incentive Compensation Plan - On December 1989, the Company approved the
1989 Incentive Compensation Plan for the purpose of attracting and
retaining key personnel.  All employees of the Company are eligible to
participate in the plan whereby incentive bonuses are determined by the
Board of Directors and payable in shares of common stock.  Shares issued
are determined at fifty percent of the closing bid price, vested, and
delivered over a three-year period.   During the year ended February 28,
1999, 20,000 shares of common stock were issued covering a previously
awarded bonus to an employee on May 18, 1998.

<PAGE>

EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FEBRUARY 29, 2000

NOTE G - EMPLOYEE BENEFITS (continued):

Employee Option Plan - The Company previously adopted The 1986 Stock Option
Plan.  As of April 1996, options may no longer be granted.  Under the terms
of the Plan, options granted could be designated as portions which qualify
for incentive stock option treatment under Section 422A of the Internal
Revenue Code of 1986, as amended, or options which do not qualify. In
December 1995, options to acquire up to 490,000 shares of the Company's
common stock were granted and expire on December 1, 2005.  In the current
year, 47,500 shares of common stock were issued to two employees.

Outstanding options remaining under the plan are as follows:

Shares allocated as of February 29, 2000          357,500

Option price                                 $       0.04

All outstanding options are exercisable currently.  No options were granted
or expired during fiscal year ended February 29, 2000.

The Company adopted the 1998 Stock Option Plan on December 1, 1998.  Under
the terms of the plan, the company reserved 750,000 shares of common stock
for issuance pursuant to the exercise of options to be granted under the
Plan, which do not meet the requirements of Section 422 of the Code.
Options expire ten years after the date granted and are subject to a
vesting period as follows: (1) no portion will be exercisable prior to the
first anniversary of the date of grant, and (2) each of the options will
become exercisable as to 50% of the shares underlying the option on each of
the first and second anniversaries of the date granted at $0.15 per share.

Options granted as of February 28, 2000:

No. of
Shares    Date Granted              Expiration Date

425,000   December 1, 1998         December 30, 2008
 25,000   February 10, 1999        February 9, 2009
 25,000   February 10, 2000        February 9, 2010

There are 275,000 options attributable to future grants.


<PAGE>

EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FEBRUARY 29, 2000

NOTE G - EMPLOYEE BENEFITS (continued):

Effective March 1, 1999, the company adopted deferred compensation
agreement with two of its employees.  Under the term of the agreement, each
employee will receive one twenty sixth (1/26th) of fifty percent (50%) of
their annual salary (excluding bonuses) as of the date of retirement.  Each
has a death vesting schedule.

NOTE H - TREASURY STOCK:

     The Company made several purchases of their own common stock during
the year ended February 29, 2000, totaling 315,700 shares at a cost of
$84,822.   Treasury stock at February 29, 2000 totaled 470,700 shares,
including 42,445 shares, which were returned to the Company at no cost in
prior years at a cumulative cost of $118,906.

NOTE I - RESEARCH AND DEVELOPMENT:

Included in selling, general and administrative expenses totaling $212,014,
$183,111 and $164,724 for the fiscal years 2000, 1999 and 1998,
respectively.

NOTE J - ACQUISITIONS:

On January 29, 1998, the Company acquired 100 shares (100% interest) of
Epolin Holding Corp.'s common stock.

NOTE K - COMMITMENTS:

On October 17, 1996, the premises leased from 350 South Street Partnership
was purchased for $450,000 by Epolin Holding Corp., a New Jersey
Corporation, controlled by Murray S. Cohen, Ph.D. and James A. Ivchenko,
officers/stockholders of Epolin, Inc. This transaction was approved by the
Board of Directors in June 1996 based upon the terms of a $350,000 mortgage
obtained from the Broad National Bank wherein personal guarantees of two
officers/stockholders were mandatory.  Other directors declined
participation in this transaction.

The down payment of $100,000 was obtained from The Company, evidenced by a
five (5) year promissory note of $75,565 (net of a three (3) months
security deposit) under the terms of a five (5) year lease payable in
monthly payments of $1,541, including interest at an annual rate of 8.25%.

<PAGE>

EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FEBRUARY 29, 2000

NOTE K - COMMITMENTS (continued):

The lease, is for a term of five (5) years with three (3) five (5) year
options at annual rentals of $97,740 subject to a Cost of Living Index
adjustment effective with the second year.  Rent includes reimbursed real
estate taxes and insurance.  Epolin Holding Corp. became a wholly owned
Subsidiary of Epolin, Inc. as of January 29, 1998.

The minimum annual rentals under the lease are as follows:

     Years Ended         Amounts
     February 28, 2001   $97,740
     February 28, 2002    65,160

The lease is anticipated to be renewed at February 28, 2002, however,
management has not determined the renewal rent.

Rental expense charged to operations and eliminated in consolidation
amounted to $97,740, $89,595 and $90,717 for the years 2000, 1999 and 1998,
respectively.

Deferred Compensation - On December 29, 1995, the Company entered into a
deferred compensation agreement with two officers.  The first officer's
additional annual compensation of $19,645 plus interest is being deferred
until such time the officer reaches age 65 or is terminated.  The
obligation is being funded with a life insurance policy.  Annual payments
of $32,000 for ten consecutive years shall commence the first day of the
month following the officer's 65th birthday or termination.  The second
officer was credited with $25,000 per year until his date of retirement,
however, he elected to continue to work after his retirement age, thereby
freezing the balance in his account.  Therefore, no contribution was
necessary for the current year.  Upon retirement, he will be paid either in
equal consecutive monthly payments for a period not exceeding sixty (60)
months or a single payment equal to the then present value of the account.
This selection will be at this discretion of the company.

Deferred compensation of $22,932, $21,840 and $20,799 for the first officer
was charged to operations for the years ended February 29, 2000, February
28, 1999 and 1998, respectively.  No charge was required for the second
officer for the year ended February 29, 2000.


<PAGE>

EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FEBRUARY 29, 2000


NOTE K - COMMITMENTS (continued):

Deferred compensation for the second officer of $25,000 was charged to
operations for the year ended February 28, 1999.  The company with the
consent of the second officer has agreed to suspend any further
contributions under the agreement.

Employment Agreements - Effective March 1, 1999, the Company entered into
ten year employment agreements with executive officers/directors:

James Ivchenko, President - To be paid an annual salary of not less than
the greater of his annual base salary in effect immediately prior to the
effective date of the agreement or any subsequently established annual base
salary.  In addition, he is to receive 1.5% of gross annual sales of no
more than $3,000,000, effective with the year ended February 29, 2000,
increasing by 0.25% a year during the term of the agreement.

Murray S. Cohen, PhD, Chairman of the Board and Chief Executive Officer -
To be paid an annual salary of not less than the greater of his annual base
salary in effect immediately prior to the effective date of the agreement
or any subsequently established annual base salary.  He is to receive 2.00%
of gross annual sales of no more than $3,000,000, effective with the year
ended February 29, 2000, increasing by 0.25% a year during the term of the
agreement.  The Company had previously entered into a deferred compensation
agreement with Dr. Cohen providing for the payment of certain funds to him
for a period of ten years beginning two weeks after the date of his
retirement, which agreement was terminated in connection with the execution
of this employment agreement.

NOTE L -  PRIOR PERIOD ADJUSTMENT:

Previously eliminated deferred compensation of $49,948 due to an officer
was reinstated, resulting in changes to accumulated deficit as of February
28, 1998.

<PAGE>