U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   Form 10-QSB

(Mark One)

                ( X ) QUARTERLY REPORT UNDER SECTION 13 0R 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  For the nine months ended September 30, 2001

                    ( ) TRANSITION REPORT UNDER SECTION 13 OR
                           15 (d) OF THE EXCHANGE ACT
    For the transition period from.....................to.......................

                         Commission file number 0-30544

                                WATER CHEF, INC.
        (Exact name of small business issuer as specified in its charter)

                  Delaware                                    86-0515678
                  --------                                    ----------
                  (State of other jurisdiction               (IRS Employer
                  of incorporation or organization)          identification No.)

            1007 Glen Cove Avenue, Suite 1, Glen Head, New York 11545
                    (Address of principal executive offices)
                                  516-656-0059
                           (Issuer's telephone number)
              -----------------------------------------------------
      (Former name, former address and former fiscal year, if changed since
                                  last report)

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

         State the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.

                                            OUTSTANDING AS OF
CLASS                                       November 19, 2001
Common
Par value $0.001 per share                     85,614,283


<PAGE>



                                 WATERCHEF, INC.
                                   Form 10QSB
                  For the Nine Months Ended September 30, 2001
                                Table of Contents


                          Part I - FINANCIAL INFORMATION

                                                                    Page

Item 1   Financial Statements (Unaudited)

         Balance sheet as of September 30, 2001                      3

         Statement of Operations for the three and nine
         months periods ended September 30, 2001 and 2000            4

         Statements of Cash Flow for the nine months periods
         ended September 30 2001 and 2000                            5

         Notes to Financial Statements                               6 - 8

Item II  Management's Discussion and Analysis or Plan
         of Operation.                                               9 - 10


                           Part II - OTHER INFORMATION

Item 1   Legal Proceedings                                           11
Item 2   Changes in Securities and Use of Proceeds                   11
Item 3   Default upon senior securities                              11
Item 4   Submission of Matters to a Vote of Security Holders         11
Item 5   Other Information                                           11
Item 6   Exhibits and Reports on Form 8-K                            11

Signatures                                                           12











                                        2
<PAGE>

                                 WATER CHEF INC.

                                  BALANCE SHEET

                               SEPTEMBER 30, 2001

                                  (Unaudited)


                                     ASSETS

CURRENT ASSETS:
 Cash                                                    $     47,368
 Accounts receivable, net of allowance
  for doubtful accounts of $2,000                              10,433
 Inventories                                                  535,171
 Prepaid expenses                                              33,180
                                                           -----------
        TOTAL CURRENT ASSETS                                  626,152

PROPERTY AND EQUIPMENT                                         12,152

INTANGIBLE AND OTHER ASSETS                                    40,776
                                                            -----------
                                                         $    679,080
                                                            ===========

                      LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES:
 Accounts payable                                        $    578,473
 Accrued expenses and other
  current liabilities                                         504,954
 Notes payable and accrued interest                         1,219,629
 Loan payable-shareholder                                     327,781
 Preferred dividends payable                                  639,031
                                                            ----------
                                                            3,269,868
                                                            ----------
        TOTAL CURRENT LIABILITIES

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' DEFICIT:
 Preferred stock, $.001 par value;
  10,000,000 shares authorized;
  145,500 shares issued and outstanding                           146
 Common stock, $.001 par value;
  90,000,000 shares authorized;
  83,509,533 shares issued and outstanding                     83,510
 Additional paid in capital                                 9,978,666
 Treasury stock, 4,400 common shares, at cost                  (5,768)
 Accumulated deficit                                      (12,647,342)
                                                          -------------
        TOTAL STOCKHOLDERS'  DEFICIT                       (2,590,788)
                                                          -------------
                                                         $    679,080
                                                          =============


                       See notes to financial statements.

                                        3

<PAGE>

                                WATER CHEF, INC.

                            STATEMENTS OF OPERATIONS

                                   (Unaudited)

                                 Three Months Ended         Nine Months Ended
                                    September 30,             September 30,
                                 ---------------------     --------------------
                                 2001          2000         2001        2000
                               ---------    -----------   ---------   ----------

Net Sales                      $  71,692    $    86,533  $   178,260 $  201,945
                               ---------    -----------   ---------   ----------
Costs and Expenses:
 Cost of sales                    90,928         31,828      188,622    106,862
 Selling, general and
  administrative (exclusive
  of non-cash compensation
  below)                         262,956         88,646      832,419    376,173
 Non-cash compensation           172,300         36,500      209,050    323,334
                                --------     -----------  ----------  ----------
                                 526,184        156,974    1,230,091    806,369
                                --------     -----------  ----------  ----------

Loss Before Other Expenses
 and Extraordinary Item         (454,492)       (70,441)  (1,051,831)  (604,424)
                                --------     -----------  ----------  ----------

Other Expenses:
 Interest expense                (75,181)        (6,750)    (139,813)   (63,680)
 Equity in loss of joint
  venture                           -           (16,759)        -       (52,184)
                                --------     -----------  ----------  ----------
 Other Expense                   (75,181)       (23,509)    (139,813)  (115,864)
                                --------     -----------  ----------  ----------
Loss Before Extraordinary Item  (529,673)       (93,950)  (1,191,644)  (720,288)

Extraordinary item - Gain on
 early extinguishment of debt       -             1,072      144,021  2,075,365
                                --------     -----------  ----------  ----------
Net Loss                        (529,673)       (92,878)  (1,047,623) 1,355,077

Preferred stock dividends        (27,075)       (27,075)     (81,225)   (81,225)
                                --------     -----------  ----------  ----------
Net Loss Applicable to
 Common Stockholders'          $(556,748)   $  (119,953) $(1,128,848)$1,273,852
                               ==========    ===========   =========  ==========


Basic and Diluted Loss Per
 Common Share:
  Loss before extraordinary
   item                        $   (0.01)   $     (0.00) $     (0.02)$    (0.01)
  Extraordinary item                -              0.00         0.00       0.04
                                --------     -----------  ----------  ----------
                               $   (0.01)   $     (0.00) $     (0.02)$     0.03
                                ========     ===========  ==========  ==========


Weighted Average Common Shares
 Outstanding -
  Basic and Diluted            82,776,924     63,293,775  79,054,222  51,302,407
                               ===========   ===========  ==========  ==========









                       See notes to financial statements.

                                        4

<PAGE>

                                 WATERCHEF INC.

                            STATEMENTS OF CASH FLOWS

                                  (Unaudited)

                                             Nine Months Ended September 30,
                                            ---------------------------------
                                                2001              2000
                                            ------------      ---------------

CASH FLOWS FROM OPERATING ACTIVITIES
 Net income (loss)                          $(1,047,623)      $    1,447,955
  Adjustments to reconcile net income
  (loss) to net cash used in operating
  activities
   Depreciation and amortization                  6,034               10,400
   Non-cash compensation                        209,050              296,834
   Equity in loss of joint venture                 -                  35,425
   Extraordinary gain on extinguishment
    of debt                                    (244,712)          (2,074,293)
   Amortization of debt discount                 62,000                 -
   Common stock issued for non-payment
    of note and interest payable                 12,300                 -
 Change in assets and liabilities
  Cash held in escrow                              -                 161,988
  Accounts receivable                            (7,209)               2,073
  Inventories                                  (479,475)             (17,049)
  Prepaid expenses and other current assets     (26,396)                (393)
  Accounts payable and accrued expenses         397,098              (10,050)
                                              ----------             --------
NET CASH USED IN OPERATING ACTIVITIES        (1,118,933)            (147,110)
                                              -----------          -----------

CASH FLOWS FROM INVESTING ACTIVITIES
 Purchase of property, plant and equipment       (1,569)             (10,000)
                                              -----------           ----------
CASH FLOWS FROM FINANCING ACTIVITIES
 Proceeds from notes payable                    450,000                 -
 Repayment of notes payable                     (25,000)            (143,745)
 Proceeds from sale of common stock             584,770              350,000
                                              -----------           ----------
NET CASH PROVIDED BY FINANCING ACTIVITIES     1,009,770              206,255
                                              -----------           ----------
NET (DECREASE) INCREASE IN CASH                (110,732)              49,145

CASH AT BEGINNING OF YEAR                       158,100                4,426
                                              -----------           ----------
CASH AT END OF PERIOD                       $    47,368       $       53,571
                                              ===========           ==========











                       See notes to financial statements.

                                        5

<PAGE>

                                WATER CHEF, INC.
                          NOTES TO FINANCIAL STATEMENTS
                               September 30, 2001
                                   (Unaudited)

1.        BASIS OF PRESENTATION

          The accompanying unaudited consolidated financial statements have been
          prepared in accordance with generally accepted  accounting  principles
          for interim financial information and the instructions to Form 10-QSB.
          Accordingly,  they do not include all the  information  and  footnotes
          required by  generally  accepted  accounting  principles  for complete
          financial  statements.  In the opinion of management,  all adjustments
          (which include only normal recurring adjustments) necessary to present
          fairly the financial  position,  results of operations  and cash flows
          for all periods  presented  have been made.  The results of operations
          for the three and nine months period ended September 30, 2001, are not
          necessarily  indicative of the operating  results that may be expected
          for the year ending  December 31,  2001.  These  financial  statements
          should be read in  conjunction  with the  Company's  December 31, 2000
          Form 10-KSB, financial statements and accompanying notes thereto.

2.        GOING CONCERN

          The accompanying financial statements have been prepared assuming that
          the Company will continue as a going concern.  The Company  incurred a
          net  loss  of  approximately  $1,048,000  nine  months  periods  ended
          September 30, 2001. Additionally,  the Company had working capital and
          total capital deficiencies of approximately  $2,644,000 and $2,591,000
          at September 30, 2001. These conditions raise  substantial doubt about
          the  Company's  ability to continue as a going  concern.  Management's
          plans with respect to these matters include restructuring its existing
          debt, raising additional capital through future issuances of stock and
          or debentures.  The accompanying  financial  statements do not include
          any adjustments  that might be necessary  should the Company be unable
          to continue as a going concern.

3.        RECENT ACCOUNTING DEVELOPMENTS

          In  July  2001,  the  Financial   Accounting  Standards  Board  issued
          Statement of Financial  Accounting Standards ("SFAS") No. 141 Business
          Combinations"  and SFAS No. 142 "Goodwill and Intangible Assets ("SFAS
          No.  142").  SFAS No.  141  requires  that all  business  combinations
          initiated  after June 30,  2001 be  accounted  for using the  purchase
          method of accounting and prohibits the use of the pooling-of-interests
          method for such transactions. SFAS No. 142 applies to all goodwill and
          intangible  assets acquired in a business  combination.  Under the new
          standard,  all goodwill,  including  goodwill  acquired before initial
          application  of the  standard,  should not be amortized  but should be
          tested for  impairment at least  annually at the reporting  level,  as
          defined in the standard.  Intangible assets other than goodwill should
          be amortized over their useful lives


                                        6
<PAGE>

          and reviewed for  impairment in accordance  with SFAS no. 121. The new
          standard is effective for fiscal years  beginning  after  December 15,
          2001.  The Company must adopt this  standard on January 1, 2002. As of
          September 30, 2001, the Company had no unamortized goodwill.

          In August 2001,  the FASB issued  Statement  of  Financial  Accounting
          Standards  No. 144 ("SFAS  144"),  "accounting  for the  Impairment or
          Disposal of  Long-lived  Assets".  SFAS 144  superceded  Statement  of
          Financial Accounting Standards No. 121, "accounting for the Impairment
          of Long-lived  Assets and Assets to be Disposed of" and the accounting
          and reporting  provisions of Accounting  Principles  Board Opinion No.
          30,  "reporting  the Results of  Operations - Reporting the Effects of
          Disposal of a Segment of a Business,  and  Extraordinary,  Unusual and
          Infrequently  Occurring Events and Transaction".  SFAS 144 also amends
          Accounting   Research   Bulletin  No.  51,   "Consolidated   Financial
          Statements  to  eliminate  the  exception  to   consolidation   for  a
          subsidiary for which control is likely to be temporary.  The provision
          of SFAS  144  will be  effective  for  fiscal  years  beginning  after
          December 15, 2001.  The Company has not yet determined the effect SFAS
          144 will have on its  financial  position or results of  operations in
          future periods.

4.        NOTES PAYABLE

          In April 2001,  the Company  issued a $400,000  promissory  note at an
          interest rate of 2% per month.  In  consideration  for the issuance of
          this note, 500,000 shares of the Company's common stock were issued to
          the note holder. For valuation  purposes,  a $62,000 debt discount was
          allocated to the common stock.  At September 30, 2001, the entire debt
          discount  has  been  amortized.  The  principal  balance  and  accrued
          interest  were payable on  September 1, 2001.  The Company did not pay
          such  principal  and  accrued  interest  and was  required to issue an
          additional  100,000 shares of its common stock to the note holder. The
          Company recorded additional interest expense of $12,300 related to the
          issuance of the additional shares.

5.        STOCKHOLDERS' EQUITY

          During the nine months ended September 30, 2001, the following  common
          stock transactions occurred:

         -        The Company sold an aggregate of  11,536,246  shares of Common
                  Stock to various  parties for  $584,770,  pursuant to
                  various subscription agreements.

         -        The Company issued an aggregate of 1,210,000 shares of Common
                  Stock for settlement of accounts payable, notes payable and
                  accrued interest of $120,595.

         -        The Company  issued an  aggregate  of  1,485,000  shares of
                  Common  Stock  valued at $209,050 for payment of services
                  rendered.



                                        7
<PAGE>

6.       COMMITMENTS AND CONTINGENCIES

         -          The Company is a defendant  in an action  brought by certain
                    debenture holders ("Bridge Loans") in New Hampshire Superior
                    Court seeking  repayment of $375,000 of debenture  principal
                    together  with  interest  from  1997,  and the  issuance  of
                    penalty shares for non payment of principal and interest. In
                    addition,  the  plaintiffs  claim they have suffered for the
                    Company's failure to have registered the shares issued under
                    the debenture,  the warrants  issued under the debenture and
                    the shares issuable under the warrant agreement.

                    The Company has interposed defenses and counterclaims, which
                    the Company and its legal counsel believe have strong merit.
                    In connection  with the  debentures the Company issued 6,667
                    shares of common  stock for every  $1,000 of debt at a price
                    of $0.15 per share.  The Company  claims that it is owed the
                    $375,000  consideration  for such shares.  In addition,  the
                    Company issued warrants for the purchase of 2,500,000 shares
                    of  common  stock at an  exercise  price of $0.15  per share
                    exercisable  until  April  2002.  Furthermore,  the  Company
                    issued  another  100,000  shares  of  common  stock  to each
                    debenture  holder,  or 1,300,000 shares, at a price of $0.15
                    per share.  The Company claims that it is owed an additional
                    $195,000  in  consideration  for such  shares.  The  Company
                    intends to contest this matter  vigorously and, in counsel's
                    opinion,  it is more likely than not that the matter will be
                    resolved  favorably to the  Company.  Pending the outcome of
                    the  aforementioned  litigation,   no  receivable  has  been
                    recorded on the books of the Company.


         -          In May 2001, the Company  entered a  distribution  agreement
                    with a company ("the  Subdistributor") based in the State of
                    Jordan.  The  Subdistributor has agreed to purchase no fewer
                    than 100 units of the Company's  "Pure Safe Water  Station",
                    in the calendar year  commencing  January 1, 2001. A minimum
                    purchase of 50 units are required to be purchased in each of
                    the subsequent  years  commencing  January 1, 2002 and 2003,
                    respectively.  As of September 30, 2001 at total of 27 units
                    have been  shipped  under this  agreement.  The sale will be
                    recognized when payments are received by the Company.

         -          The Company  entered  into a three year master  distribution
                    agreement  for  their  "Pure  Safe  Water  Station"  with  a
                    distributor  based  out of Hong  Kong  ("the  distributor").
                    Under this  agreement,  upon meeting  minimum  quantities of
                    sales in each of the  years of  agreement,  the  distributor
                    will  receive  a rebate  of 20% of the  total  price for all
                    products,  parts and  supplies  purchased  from the Company.
                    Furthermore,  the  distributor,  upon meeting  these minimum
                    sales  quantities  will  have the  right to  purchase  up to
                    30,000,000 shares of the Company's common stock at $0.20 per
                    share.





                                        8

<PAGE>

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

RESULTS OF OPERATIONS

For the three and nine months ended September 30, 2001 compared to the three and
nine months ended September 30, 2000, results of operations were as follows:

NET SALES:

-         Net sales for the three and nine months  periods  ended  September 30,
          2001 were $71,692 and $178,260,  respectively  as compared to sales of
          $86,533  and  $201,945  for the three  and  nine-month  periods  ended
          September 30, 2000. The decrease of $14,841 or 17% for the three-month
          period and $23,685 or 12% for the nine-month  period was attributed to
          the  company's  withdrawal  from  marketing  agreements  with a  large
          multiunit retailer.  The per unit margins decreased to negative levels
          due to warehouse and return  policies of the customer that were not in
          the control of WaterChef, Inc.

COSTS AND EXPENSES:

-         Cost of sales for the three and nine month periods ended September 30,
          2001 were $90,928 and $188,622,  respectively,  as compared to $31,828
          and $106,862 for the three and nine month periods ended  September 30,
          2000.  There was a increase  of  $59,100  or 186% for the  three-month
          period and an increase of $81,760 or 77% for the nine-month period due
          primarily to a write down of obsolete inventory.

-         Selling,  general and  administrative  expenses for the three and nine
          month  periods  ended  September  30, 2001 were $262,956 and $832,419,
          respectively,  as compared to $88,646 and  $376,173  for the three and
          nine month periods ended September 30, 2000.  There was an increase of
          $174,310 or 197% for the  three-month  period and $456,246 or 121% for
          the nine-month  period due to costs associated with the development of
          strategic and tactical  marketing plans as well as the  implementation
          of these plans for the  companies new product line the Pure safe Water
          System.

-         Non-cash  compensation  expense  for the three and nine month  periods
          ended September 30, 2001 were $172,300 and $209,050,  respectively, as
          compared to $36,500 and $323,334 for the three and nine month  periods
          ended  September  30, 2000.  There was an increase of $135,800 or 372%
          for the  three-month  period and a decrease of $114,284 or 35% for the
          nine-month  period due to the  willingness  of outside  specialists to
          accept company shares as compensation.









                                        9
<PAGE>

OTHER EXPENSES AND EXTRAORDINARY ITEM:

-         Interest  expense for the three and nine month periods ended September
          30,  2001 were  $75,181  and  $139,813,  respectively,  as compared to
          $6,750  and  $63,680  for the  three  and  nine  month  periods  ended
          September 30, 2000.  There was an increase of $68,431 or 1014% for the
          three-month  period  and an  increase  of $76,133 or 120% for the nine
          month period due to increased reliance on debt to fund the manufacture
          of units against orders received by the company and not booked as paid
          at quarter end.

-         In the three and nine  month  periods  ended  September  30,  2000 the
          Company  wrote-off  its  investment  in a joint  venture  in China for
          $16,759 and $52,184,  respectively.  The  investment was fully written
          off as of December 31, 2000.

-         In the nine months ended  September 30, 2000 the Company  aggressively
          restructured its outstanding debt and extinguished $2,075,365 of debt.
          For the nine moths ended September 30, 2001 an additional  $144,021 of
          debt was extinguished through restructuring by management.

LIQUIDITY AND CAPITAL RESOURCES

The Company's liquidity needs arise from working capital  requirements,  capital
expenditures,  and principal and interest payments.  Historically, the Company's
primary source of liquidity has been cash flow generated by the issuance of debt
and the sale of its common  stock.  The Company's  cash  decreased to $47,368 on
September 30, 2001 from $158,100 on December 31, 2000.

Cash flows used in operating activities was $1,118,933 for the nine months ended
September  28,  2001  on a net  loss  of  $1,047,623.  Cash  used  in  investing
activities  for the nine  months  ended  September  30,  2001 was  $1,569  which
consisted of cash used for the purchase of machinery and equipment.

Net cash provided by financing  activities  for the nine months ended  September
30, 2001 was  $1,009,770.  Cash of $450,000 was provided  from the issuance of a
note payable and $584,770 was provided  from the sale of common  stock.  Cash of
$25,000 was used to make principal repayments on an outstanding loan.

CAUTIONARY FACTORS REGARDING FUTURE OPERATING RESULTS

The matters  discussed  in this form 10-QSB other than  historical  material are
forward-looking  statements.  Any such  forward-looking  statements are based on
current expectations of future events and are subject to risks and uncertainties
which could cause actual results to vary materially from those indicated. Actual
results could differ due to a number of factors, including negative developments
relating to unforeseen order cancellations or push outs, the Company's strategic
relationships,  the impact of intense  competition  and changes in our industry.
The Company assumes no obligation to update any forward-looking  statements as a
result of new information or future events or developments.


                                       10
<PAGE>

PART II  OTHER INFORMATION

Item 1              Legal Proceedings


                    The Company is a defendant  in an action  brought by certain
                    debenture holders ("Bridge Loans") in New Hampshire Superior
                    Court seeking  repayment of $375,000 of debenture  principal
                    together  with  interest  from  1997,  and the  issuance  of
                    penalty shares for non payment of principal and interest. In
                    addition,  the  plaintiffs  claim they have suffered for the
                    Company's failure to have registered the shares issued under
                    the debenture,  the warrants  issued under the debenture and
                    the shares issuable under the warrant agreement.

                    The Company has interposed defenses and counterclaims, which
                    the Company and its legal counsel believe have strong merit.
                    In connection  with the  debentures the Company issued 6,667
                    shares of common  stock for every  $1,000 of debt at a price
                    of $0.15 per share.  The Company  claims that it is owed the
                    $375,000  consideration  for such shares.  In addition,  the
                    Company issued warrants for the purchase of 2,500,000 shares
                    of  common  stock at an  exercise  price of $0.15  per share
                    exercisable  until  April  2002.  Furthermore,  the  Company
                    issued  another  100,000  shares  of  common  stock  to each
                    debenture  holder,  or 1,300,000 shares, at a price of $0.15
                    per share.  The Company claims that it is owed an additional
                    $195,000  in  consideration  for such  shares.  The  Company
                    intends to contest this matter  vigorously and, in counsel's
                    opinion,  it is more likely than not that the matter will be
                    resolved  favorably to the  Company.  Pending the outcome of
                    the  aforementioned  litigation,   no   receivable  has been
                    recorded on the books of the Company.


Item 2            Changes in Securities

                  None

Item 3            Default on Senior Securities

                  None

Item 4            Submission of Matters to a Vote of Shareholders

                  None

Item 5            Other Information

                  None

Item 6            Exhibits and Reports on Form 8-K

                           Exhibits:        None

                           Reports on Form 8-K:               None












                                       11
<PAGE>

                                   SIGNATURES



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

                                                  WATER CHEF, INC.


Date:      November 19, 2001                      /s/ David A. Conway
                                                  ------------------------------
                                                   David A. Conway
                                                   President, Director and Chief
                                                   Executive Officer
                                                   (Principal Operating Officer)

































                                       12