SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549
                                    _________

                                    Form 10-Q

  X    QUARTERLY  REPORT  PURSUANT  TO  SECTION  13  OR  15(d) OF THE SECURITIES
-----  EXCHANGE  ACT  OF  1934
       For  the  quarterly  period  ended  March  31,  2003
                                           ----------------

                                       OR

       TRANSITION  REPORT  PURSUANT  TO  SECTION  13  OR 15(d) OF THE SECURITIES
-----  EXCHANGE  ACT  OF  1934

For  the  transition  period  from  ____________  to  ____________

                         Commission file number  0-16061
                                                 -------

                             CRITICARE SYSTEMS, INC.
                     ---------------------------------------
             (Exact name of registrant as specified in its charter)

             Delaware                                39-1501563
         -----------------                     -------------------------
  (State or other jurisdiction of          (IRS Employer Identification No.)
  incorporation  or  organization)

  20925 Crossroads Circle, Suite 100,  Waukesha, Wisconsin           53186
  ---------------------------------------------------------------------------
    (Address of principal executive offices)                       (Zip Code)

Registrant's  telephone  number  including  area  code  (262)  798-8282
                                                        ---------------

                                   N/A
-------------------------------------------------------------------------------
 Former  name,  former  address  and  former fiscal year, if changed since last
 report.

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding  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
                                                                   ---      ---

Indicate  by  check  mark  whether  the  registrant  is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).                   Yes       No   X
                                                                   ---      ---


Number of shares outstanding of each class of the registrant's classes of common
stock  as of March 31, 2003:   Common Stock, $0.04 par value, 11,204,024 shares.


<PAGE>
                             CRITICARE SYSTEMS, INC.
                           CONSOLIDATED BALANCE SHEETS
                        MARCH 31, 2003 AND JUNE 30, 2002

                                   (UNAUDITED)
<TABLE>
<CAPTION>

                                                                            March 31,      June 30,
ASSETS                                                                        2003          2002
                                                                          ------------  ------------
<S>                                                                       <C>           <C>
CURRENT ASSETS:
Cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . .  $ 5,163,809   $ 3,523,070
Accounts receivable, less allowance for doubtful accounts
   of $300,000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    5,424,820     5,481,952
Investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            -     2,304,689
Other receivables. . . . . . . . . . . . . . . . . . . . . . . . . . . .      291,199       502,348
Inventories. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    7,400,307     7,134,803
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . .      332,368       453,347
                                                                          ------------  ------------
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . .   18,612,503    19,400,209

Property, plant and equipment - net. . . . . . . . . . . . . . . . . . .    2,213,200     5,983,060

License rights and patents - net . . . . . . . . . . . . . . . . . . . .       85,736        90,987
                                                                          ------------  ------------

TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $20,911,439   $25,474,256
                                                                          ============  ============

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $ 3,154,129   $ 2,331,496
Accrued liabilities:
    Compensation and commissions . . . . . . . . . . . . . . . . . . . .      800,492       770,578
    Product warranties . . . . . . . . . . . . . . . . . . . . . . . . .      327,692       248,725
    Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      264,792       490,922
Current maturities of long-term debt . . . . . . . . . . . . . . . . . .            -        93,589
                                                                          ------------  ------------
Total current liabilities. . . . . . . . . . . . . . . . . . . . . . . .    4,547,105     3,935,310

LONG-TERM DEBT, less current maturities. . . . . . . . . . . . . . . . .            -     3,103,536

OTHER LONG-TERM OBLIGATIONS. . . . . . . . . . . . . . . . . . . . . . .       37,766        48,344

STOCKHOLDERS' EQUITY:
Preferred stock - $.04 par value, 500,000 shares authorized,
    no shares issued or outstanding. . . . . . . . . . . . . . . . . . .            -             -
Common stock - $.04 par value, 15,000,000 shares authorized,
    11,204,024 and 11,199,524 shares issued, respectively. . . . . . . .      448,161       447,981
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . .   23,359,731    23,350,124
Common stock held in treasury (132,076 and 100,890 shares, respectively)     (423,127)     (309,059)
Subscriptions receivable . . . . . . . . . . . . . . . . . . . . . . . .     (225,000)     (225,000)
Retained earnings (accumulated deficit). . . . . . . . . . . . . . . . .   (6,839,297)   (7,187,501)
Cumulative translation adjustment. . . . . . . . . . . . . . . . . . . .        6,100         5,832
Unrealized gain on investments . . . . . . . . . . . . . . . . . . . . .            -     2,304,689
                                                                          ------------  ------------
Total stockholders' equity . . . . . . . . . . . . . . . . . . . . . . .   16,326,568    18,387,066
                                                                          ------------  ------------
TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $20,911,439   $25,474,256
                                                                          ============  ============
</TABLE>


See  notes  to  consolidated  financial  statements.

                                        2
<PAGE>

                             CRITICARE SYSTEMS, INC.
                         CONSOLIDATED INCOME STATEMENTS
                    NINE MONTHS ENDED MARCH 31, 2003 AND 2002

                                   (UNAUDITED)
<TABLE>
<CAPTION>

                                            2003          2002
                                        ------------  ------------
<S>                                     <C>           <C>
NET SALES. . . . . . . . . . . . . . .  $21,857,740   $19,238,364

COST OF GOODS SOLD . . . . . . . . . .   13,041,237    12,195,255
                                        ------------  ------------

GROSS PROFIT . . . . . . . . . . . . .    8,816,503     7,043,109

OPERATING EXPENSES:
Sales and marketing. . . . . . . . . .    4,875,229     4,105,055
Research, development and engineering.    2,078,572     1,737,343
Administrative . . . . . . . . . . . .    2,977,022     2,241,884
                                        ------------  ------------
  Total. . . . . . . . . . . . . . . .    9,930,823     8,084,282

LOSS FROM OPERATIONS . . . . . . . . .   (1,114,320)   (1,041,173)

OTHER INCOME (EXPENSE):
Interest expense . . . . . . . . . . .      (91,533)     (185,457)
Interest income. . . . . . . . . . . .       40,544        61,932
Other. . . . . . . . . . . . . . . . .    1,513,513        53,592
                                        ------------  ------------
  Total. . . . . . . . . . . . . . . .    1,462,524       (69,933)

INCOME (LOSS) BEFORE INCOME TAXES. . .      348,204    (1,111,106)

INCOME TAX PROVISION . . . . . . . . .            -             -
                                        ------------  ------------

NET INCOME (LOSS). . . . . . . . . . .  $   348,204   $(1,111,106)
                                        ============  ============

NET INCOME (LOSS) PER COMMON SHARE:
Basic. . . . . . . . . . . . . . . . .  $      0.03   $     (0.10)
Diluted. . . . . . . . . . . . . . . .  $      0.03   $     (0.10)

WEIGHTED AVERAGE NUMBER OF COMMON
  SHARES OUTSTANDING:
Basic. . . . . . . . . . . . . . . . .   11,071,267    10,815,814
Diluted. . . . . . . . . . . . . . . .   11,423,100    10,815,814
</TABLE>


See  notes  to  consolidated  financial  statements.

                                        3
<PAGE>

                             CRITICARE SYSTEMS, INC.
                         CONSOLIDATED INCOME STATEMENTS
                   THREE MONTHS ENDED MARCH 31, 2003 AND 2002

                                   (UNAUDITED)
<TABLE>
<CAPTION>

                                            2003          2002
                                        ------------  ------------
<S>                                     <C>           <C>
NET SALES. . . . . . . . . . . . . . .  $ 6,503,787   $ 6,402,631

COST OF GOODS SOLD . . . . . . . . . .    4,022,771     4,035,101
                                        ------------  ------------

GROSS PROFIT . . . . . . . . . . . . .    2,481,016     2,367,530

OPERATING EXPENSES:
Sales and marketing. . . . . . . . . .    1,533,931     1,001,622
Research, development and engineering.      692,917       569,642
Administrative . . . . . . . . . . . .      888,261       998,288
                                        ------------  ------------
  Total. . . . . . . . . . . . . . . .    3,115,109     2,569,552

LOSS FROM OPERATIONS . . . . . . . . .     (634,093)     (202,022)

OTHER INCOME (EXPENSE):
Interest expense . . . . . . . . . . .            -       (60,509)
Interest income. . . . . . . . . . . .       12,016        13,933
Other. . . . . . . . . . . . . . . . .    1,081,761        13,814
                                        ------------  ------------
  Total. . . . . . . . . . . . . . . .    1,093,777       (32,762)

INCOME (LOSS) BEFORE INCOME TAXES. . .      459,684      (234,784)

INCOME TAX PROVISION . . . . . . . . .            -             -
                                        ------------  ------------

NET INCOME (LOSS). . . . . . . . . . .  $   459,684   $  (234,784)
                                        ============  ============

NET INCOME (LOSS) PER COMMON SHARE:
Basic. . . . . . . . . . . . . . . . .  $      0.04   $     (0.02)
Diluted. . . . . . . . . . . . . . . .  $      0.04   $     (0.02)

WEIGHTED AVERAGE NUMBER OF COMMON
    SHARES OUTSTANDING:
Basic. . . . . . . . . . . . . . . . .   11,071,273    10,927,806
Diluted. . . . . . . . . . . . . . . .   11,370,087    10,927,806
</TABLE>

See  notes  to  consolidated  financial  statements.

                                        4
<PAGE>
                             CRITICARE SYSTEMS, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                    NINE MONTHS ENDED MARCH 31, 2003 AND 2002

                                   (UNAUDITED)
<TABLE>
<CAPTION>

                                                             2003          2002
                                                         ------------  ------------
<S>                                                      <C>           <C>
OPERATING ACTIVITIES:
Net income (loss) . . . . . . . . . . . . . . . . . . .  $   348,204   $(1,111,106)
Adjustments to reconcile net income (loss) to net cash
    used in operating activities:
         Depreciation . . . . . . . . . . . . . . . . .      713,839       633,934
         Amortization . . . . . . . . . . . . . . . . .        5,251         5,251
         Provision for doubtful accounts. . . . . . . .            -      (386,000)
         Provision for obsolete inventory . . . . . . .      184,225       451,000
         Gain on sale of Immtech stock. . . . . . . . .   (1,290,252)            -
         Gain on sale of fixed assets . . . . . . . . .      (41,208)       (5,292)
         Changes in assets and liabilities:
              Accounts receivable . . . . . . . . . . .       57,132     1,106,615
              Other receivables . . . . . . . . . . . .      211,149        12,215
              Inventories . . . . . . . . . . . . . . .     (473,197)      390,567
              Prepaid expenses. . . . . . . . . . . . .      120,979       102,077
              Accounts payable. . . . . . . . . . . . .      822,633    (1,426,783)
              Accrued liabilities . . . . . . . . . . .     (127,827)     (473,349)
                                                         ------------  ------------
Net cash provided by (used in) operating activities . .      530,928      (700,871)

INVESTING ACTIVITIES:
Purchases of property, plant and equipment, net . . . .     (674,757)     (194,453)
Proceeds from sale of Immtech stock . . . . . . . . . .    1,290,252             -
Proceeds from sale of building. . . . . . . . . . . . .    3,795,164             -
Proceeds from sale of fixed assets. . . . . . . . . . .            -         5,500
                                                         ------------  ------------
Net cash provided by (used in) investing activities . .    4,410,659      (188,953)

FINANCING ACTIVITIES:
Retirement of long-term debt. . . . . . . . . . . . . .   (3,197,125)      (64,945)
Repurchase of Company common stock. . . . . . . . . . .     (121,359)            -
Proceeds from issuance of common stock. . . . . . . . .       17,368       452,851
                                                         ------------  ------------
Net cash (used in) provided by financing activities . .   (3,301,116)      387,906

EFFECT OF EXCHANGE RATE CHANGES ON CASH . . . . . . . .          268             -

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS. .    1,640,739      (501,918)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD. . . . .    3,523,070     3,362,104
                                                         ------------  ------------
CASH AND CASH EQUIVALENTS, END OF PERIOD. . . . . . . .  $ 5,163,809   $ 2,860,186
                                                         ============  ============

</TABLE>


See  notes  to  consolidated  financial  statements.
                                        5
<PAGE>


                             CRITICARE SYSTEMS, INC.
              Condensed Notes to Consolidated Financial Statements
                                   (Unaudited)

1.  BASIS  OF  PRESENTATION

The  accompanying unaudited financial statements have been prepared by Criticare
Systems,  Inc.  (the  "Company")  pursuant  to  the rules and regulations of the
Securities  and  Exchange Commission ("SEC") and, in the opinion of the Company,
include  all  adjustments  necessary  for  a  fair statement of results for each
period shown.  Certain information and footnote disclosures normally included in
financial  statements  prepared in accordance with generally accepted accounting
principles  have  been  condensed  or  omitted  pursuant  to  such SEC rules and
regulations.  The  Company  believes  that  the disclosures made are adequate to
prevent  the financial information given from being misleading.  It is suggested
that  these  financial  statements  be  read  in  conjunction with the financial
statements  and notes thereto included in the Company's latest annual report and
previously  filed  Form  10-K.  Certain  amounts  from the fiscal 2002 financial
statements  have  been  reclassified  to  conform  to  the  2003  presentation.


2.  INVENTORY  VALUATION

Inventory  is stated at the lower of cost or market, with cost determined on the
first-in,  first-out method.  Components of inventory consisted of the following
at  March  31,  2003  and  June  30,  2002,  respectively:
<TABLE>
<CAPTION>

                                 March 31, 2003   June 30, 2002
                                 ---------------  --------------
<S>                              <C>              <C>
Component parts . . . . . . . .  $     2,818,491  $    3,549,397
Work in process . . . . . . . .          702,641         499,950
Finished units. . . . . . . . .        4,342,987       4,031,456
                                 ---------------  --------------
Total inventories . . . . . . .        7,864,119       8,080,803
Less:  reserve for obsolescence          463,812         946,000
                                 ---------------  --------------
Net inventory . . . . . . . . .  $     7,400,307  $    7,134,803
</TABLE>


                                        6
<PAGE>
3.  INVESTMENTS

During  fiscal  2003,  the  Company  completely  liquidated  its position in its
Immtech  International,  Inc.  ("Immtech")  common  stock.  The Company sold all
456,374  Immtech  shares  it  held and realized the following gains in the first
three  quarters  of  fiscal  2003:
<TABLE>
<CAPTION>

                                                   Shares              Realized
                                                    Sold                 Gain
                                                   ------              --------
<S>                                                <C>                <C>
1st quarter ended September 30, 2002 . . . . . .    50,000             $  241,746
2nd quarter ended December 31, 2002. . . . . . .     4,000                 14,096
3rd quarter ended March 31, 2003 . . . . . . . .   402,374              1,034,410
                                                   -------             ----------
       Total . . . . . . . . . . . . . . . . . .   456,374             $1,290,252
</TABLE>

4.  PROPERTY,  PLANT  AND  EQUIPMENT

Property,  plant  and  equipment  consist  of  the  following:
<TABLE>
<CAPTION>

                                      March 31, 2003   June 30, 2002
                                      ---------------  --------------
<S>                                   <C>              <C>
Land and building. . . . . . . . . .  $             -  $    4,525,000
Machinery and equipment. . . . . . .        2,213,520       2,007,322
Furniture and fixtures . . . . . . .          910,801         809,277
Construction in progress . . . . . .                -         116,798
Leasehold improvements . . . . . . .          212,229               -
Demonstration and loaner monitors. .        1,400,295       1,616,766
Production tooling . . . . . . . . .        3,574,889       3,425,117
                                      ---------------  --------------
Property, plant and equipment - cost        8,311,734      12,500,280
Less:  accumulated depreciation. . .        6,098,534       6,517,220
                                      ---------------  --------------
Property, plant and equipment - net.  $     2,213,200  $    5,983,060
</TABLE>

On  August  30,  2002,  the Company sold its building in Waukesha, Wisconsin and
leased  back  approximately  62% of the building's square footage.  The building
was sold for $4,000,000 and a gain of $41,208 was realized on the sale after the
payment of commissions and fees and the funding of $105,396 in capitalized build
out  costs  needed to split the building into two leasable spaces.  The proceeds
from  the  sale  were  used  to  retire  the $3,182,160 of debt on the Company's
balance  sheet  at  August 30, 2002 and increased the Company's cash position by
approximately  $500,000.

                                        7
<PAGE>
5.  CONTINGENCIES

The import and export rules applicable to all United States companies engaged in
international  business  transactions contain compliance guidelines.  Violations
may  result  in  civil  or criminal penalties, or both, as well as the potential
loss  of  export  privileges.

On  August  6,  2002,  in  part  due  to  the  new regulations imposed under the
Sarbanes-Oxley  Act,  the Company initiated an internal review of its import and
export  procedures.  On August 28, 2002, senior management of the Company became
aware of previous events that may have violated United States import/export laws
and  regulations.  Senior  management  of  the Company immediately authorized an
internal  audit  of  these  possible violations, focusing on the sale of medical
equipment  directly or indirectly into an embargoed country and possible marking
issues.

The  factual  investigation  pursuant  to  the  internal  audit  is complete, no
additional  compliance  issues  arose,  and  no  material  marking  issues  were
identified  as  a  result  of  the  investigation.

Subsequently,  the  Company  has  taken  action to adopt and implement a written
compliance  program  with respect to applicable import/export rules. The Company
has also undertaken a voluntary disclosure with the relevant government agencies
and  has  filed its completed internal audit report and all requested documents.
Although there is no assurance, based upon the results of the completed internal
audit  and  precedents,  the  Company  believes  a  negotiated settlement of any
violations  will  not  have  a  material  adverse  effect  on  the Company.   In
addition, the Company does not believe that the audit result supports the denial
of  export  privileges;  however, any such penalty would have a material adverse
effect  on  the  Company's  business.  The  Company  further  believes  that the
voluntary  disclosure,  along  with  other internal actions taken, will serve to
mitigate  any  potential  adverse  consequences  that  otherwise  might  accrue.

6.  SUBSCRIPTIONS  RECEIVABLE

Subscriptions  receivable  represents  common  stock  issued  in May 2002 to two
directors  of  the  Company,  Milton  Datsopoulos  and  Karsten Houm, related to
expiring  stock options.  The shares were issued and promissory notes payable in
the  amount  of $112,500 were executed by each of the directors for the exercise
price  of  the stock options.  In February 2003 these two directors retired from
the Board.  After their retirement, the promissory notes were refinanced through
the issuance of two new notes dated March 1, 2003.  These notes are non-interest
bearing  and  are due and payable on May 6, 2004.  Each of the retired directors
have  pledged  the  shares  issued  as  collateral  for  these  loans.

                                        8
<PAGE>
7.  STOCK  OPTIONS

The  Company  has  adopted  the  disclosure-only  provisions  of  SFAS  No. 123,
"Accounting  for  Stock-Based  Compensation"  and  SFAS No. 148, "Accounting for
Stock-Based Compensation-Transition and Disclosure".  If the Company had elected
to  recognize  compensation cost for the options granted for the nine months and
three  months  ended  March  31,  2003  and  2002,  consistent  with  the method
prescribed  by  SFAS  No. 123, net income (loss) and net income (loss) per share
would  have  been  changed  to  the  pro  forma  amounts  indicated  below:

<TABLE>
<CAPTION>

                                                       Nine  months  ended  March  31     Three  Months  ended  March  31
                                                       ------------------------------     -------------------------------
                                                          2003             2002                2003              2002
                                                          ----             ----                ----              ----
<S>                                                     <C>           <C>                     <C>             <C>
Net income (loss) - as reported . . . . . . . . . .     $348,204      $(1,111,106)            $459,684        $(234,784)
Net income (loss) - pro forma . . . . . . . . . . .     $208,178      $(1,209,484)            $413,009        $(267,577)

Basic net income (loss) per share - as reported . .        $0.03           $(0.10)               $0.04           $(0.02)
Basic net income (loss) per share - pro forma . . .        $0.02           $(0.11)               $0.04           $(0.02)

Diluted net income (loss) per share - as reported .        $0.03           $(0.10)               $0.04           $(0.02)
Diluted net income (loss) per share - pro forma . .        $0.02           $(0.11)               $0.04           $(0.02)
</TABLE>


The  fair value of stock options used to compute pro forma net income (loss) and
net  income  (loss)  per  share is the estimated present value at the grant date
using  the  Black-Scholes  option-pricing  model.

8.  GUARANTEE

Criticare  Integration,  Inc.,  a  wholly  owned  U.S.  subsidiary  of Criticare
Systems, Inc., was incorporated on April 8, 2003 to supply medical equipment and
supplies  to  medical  facilities  in  countries  in the Black Sea Economic Zone
(Albania,  Armenia,  Azerbaijan,  Bulgaria,  Georgia, Romania, and the Ukraine).
Criticare  Systems,  Inc.  has set up a standby letter of credit for $300,000 on
behalf  of  Criticare  Integration  that acts as a guarantee related to this new
venture.  The  standby  letter  of credit serves as a guarantee for a $2,000,000
line  of  credit  that  has  been extended by a large Austrian bank to fund this
project.  The  standby  letter  of credit expires on November 15, 2003 and would
only be called if the Austrian bank had significant collection problems with the
project.  No  collection  problems  are anticipated as stringent credit policies
are  in  place  and  the  right  to  repossess  the equipment is maintained.


                                        9
<PAGE>
                             CRITICARE SYSTEMS, INC.
                     Management's Discussion and Analysis of
                  Results of Operations and Financial Condition
                    Nine Months Ended March 31, 2003 and 2002

RESULTS  OF  OPERATIONS
-----------------------

Net  sales  of  $21.9  million  for the nine months ended March 31, 2003 were up
13.6%  from  the $19.2 million of net sales generated for the same period in the
prior year. The Company's domestic, international, and OEM sales were all higher
than  the  prior  year  period,  with  domestic  and OEM sales contributing most
significantly  to  the  sales increase.  A 16.8% increase in the number of units
shipped  and  a  6.5%  increase in the average selling price per unit, partially
offset  by  a  12.0%  decrease in accessory sales, drove the higher year-to-date
sales.

The  gross  profit  percentage  for the first nine months of the current year of
40.3%  improved  almost  four points from the 36.6% generated for the first nine
months  of  the  prior year.  The higher sales in the current year resulted in a
better  utilization of fixed manufacturing costs and was the main contributor to
the  improved  margins.

Operating expenses for the nine months ended March 31, 2003 were higher than the
same  period  in  the  prior  year  by  $1.8  million.  Administrative  expenses
increased  $735,138  due  mainly  to  legal  and  consulting fees related to the
internal  review  conducted  by  the Company of its import and export procedures
that totaled approximately $421,000, and a final payment of $150,000 made to the
Company's  former  CEO  and founder to satisfy past severance obligation issues.
Research,  development  and engineering expenses were up $341,229 in the current
year  due  mostly  to  a  $319,000  increase in combined labor costs and project
spending  incurred  to  launch  the Company's new line of proprietary anesthesia
monitoring  products.  Sales  and marketing expenses were $770,174 higher in the
current  year  due  mostly  to a $386,000 reduction in the reserve for bad debts
that  was  recorded  in the prior year, driven by cash collections on an at risk
receivable  that  had  been  specifically  reserved for. In addition, a $275,000
increase  in  employee  and  dealer  commissions  and bonus driven by the higher
sales,  and  a $97,000 increase in trade show spending to support the rollout of
the  Company's  new  anesthesia  products  contributed  to  the higher sales and
marketing  expenses  in  the  current  year.

Total  other  income  in  the  current  year  of $1,462,524 more than offset the
increase  in  operating  expenses, resulting in a bottom line profit of $348,204
that  was $1,459,310 better than the $1,111,106 net loss in the prior year.  The
other income consisted mainly of a $1,290,252 gain recognized on the sale of the
Company's  investment  in  Immtech International, Inc.  Also contributing to the
higher  other  income was $93,000 in profits recognized on a medical integration
project  in  Romania  and  a $41,208 gain on the sale of the Company's building.


                                       10
<PAGE>
                             CRITICARE SYSTEMS, INC.
                     Management's Discussion and Analysis of
                  Results of Operations and Financial Condition
                   Three Months Ended March 31, 2003 and 2002

RESULTS  OF  OPERATIONS
-----------------------

Net  sales  for  the  three  months ended March 31, 2003 of $6.5 million were up
slightly  from  the  $6.4  million  for  the same period in fiscal 2002.  A 7.0%
increase  in  the  number of units shipped in the quarter and a 4.7% increase in
the  average  selling  price  per  unit more than offset a $391,582 reduction in
accessory  sales.  Higher  domestic  and  international  sales  in  the quarter,
combined  with  the  Company's  first  shipment of Criticare products to Romania
totaling  $260,260,  more  than  offset  lower  OEM  and  government  sales.

The  gross  profit percentage for the three months ended March 31, 2003 of 38.1%
was  up from 37.0% for the same period in the prior year.  The slightly improved
margins  in  the  current  quarter  was  driven mainly by sales of the Company's
recently  introduced  and  higher  margin  anesthesia  products.

Operating  expenses  for  the three months ended March 31, 2003 were up $545,557
from  the  same  period  in  the prior year due mainly to a $532,309 increase in
sales  and marketing expenses.  As noted above, the prior year period included a
$386,000  reduction  in  the reserve for bad debts and related bad debt expense,
driven  by  cash collections on an at risk receivable that had been specifically
reserved  for.  In  addition,  a  $58,000  increase  in  employee  and  dealer
commissions  driven by the higher domestic sales and a $61,000 increase in trade
show  and related sales travel expenses also contributed to the higher sales and
marketing  expenses  in  the  current  period.

Other  income improved $1,126,539 for the three months ended March 31, 2003 from
the  same  period in the prior year, due mainly to a $1,034,410 gain on the sale
of  the last of the Company's shares of its investment in Immtech International,
Inc.  In addition, the Company incurred no interest expense in its current third
quarter  ended March 31, 2003 due to the retirement of its long-term debt in the
first  quarter of the current year, resulting in a $60,509 savings from the same
period  in  the  prior  year.

The  higher  other  income  for  the three months ended March 31, 2003 more than
offset  the increase in operating expenses, resulting in a bottom line profit of
$459,684  that  was  $694,468  better than the $234,784 net loss from the fiscal
third  quarter  of  the  prior  year.


                                       11
<PAGE>
                             CRITICARE SYSTEMS, INC.
                     Management's Discussion and Analysis of
                  Results of Operations and Financial Condition

LIQUIDITY  AND  CAPITAL  RESOURCES
----------------------------------

As  of March 31, 2003, the Company had a cash balance of $5,163,809, an increase
of  $1,640,739  from  its  balance  at  June 30, 2002, and a long-term debt free
balance  sheet  due  to the sale of the Company's building in the current fiscal
year.  The  Company  sold its building in Waukesha, Wisconsin in August of 2002,
leased  back approximately 62% of its square footage, and used the proceeds from
the  sale  to  retire  the long-term debt on the balance sheet.  The sale of the
building  increased the Company's cash position by approximately $500,000 and is
expected  to  improve future cash flows by almost $150,000 annually, through the
elimination  of interest expense and excess square footage (see "Forward Looking
Statements").

The  other  significant event favorably impacting cash flows for the nine months
ended March 31, 2003 was the sale of all 456,374 shares of the Company's Immtech
International,  Inc. stock.  The sale of these shares resulted in an increase in
cash  and  a  realized  gain  of  $1,290,252  in  the  current  year.

The  Company  believes  all  future  capital  and liquidity requirements will be
satisfied  by  cash generated from operations and its current cash balances.  No
major  capital equipment expenditures are expected for the remainder of calendar
year  2003.  The Company also has a $4,000,000 line of credit currently in place
that  expires  in  November 2003 that could be utilized, if necessary.  At March
31,  2003,  there  were  no  borrowings  outstanding  under this line of credit.

FORWARD  LOOKING  STATEMENTS
----------------------------

A  number  of  the  matters  and  subject  areas  discussed  herein that are not
historical  or  current  facts  deal  with  potential  future  circumstances and
developments.  These  include anticipated product introductions, expected future
financial  results,  liquidity  needs,  financing  ability,  management's or the
Company's expectations and beliefs and similar matters discussed in Management's
Discussion  and  Analysis  or elsewhere herein.  The discussions of such matters
and  subject  areas  are  qualified  by  the  inherent  risk  and  uncertainties
surrounding  future  expectations generally, and also may materially differ from
the  Company's  actual  future  experience.

The  Company's  business,  operations  and  financial performance are subject to
certain  risks  and  uncertainties which could result in material differences in
actual  results  from management's or the Company's current expectations.  These
risks  and  uncertainties  include,  but  are  not  limited to, general economic
conditions,  demand  for  the  Company's  products,  costs  of  operations,  the
development  of  new  products,  the  reliance  on  single sources of supply for
certain components in the Company's products, government regulation, health care
cost containment programs, the effectiveness of the Company's programs to manage
working  capital  and  reduce  costs,  competition  in  the  Company's  markets,
compliance  with  product  safety  regulations and product liability and product
recall  risks,  risks  relating  to international sales and compliance with U.S.
export  regulations, unanticipated difficulties in outsourcing the manufacturing
of  the  majority  of its products to foreign manufacturers and risks related to
foreign  manufacturing,  including economic and political instability, trade and
foreign  tax  laws, production delays and cost overruns and quality control, and
the  Company's  ability  to  reduce  costs by eliminating excess capacity at its
principal  facility.


                                       12
<PAGE>
CONTROLS  AND  PROCEDURES
-------------------------

Within  90  days  prior  to  the date of this report, the Company carried out an
evaluation,  under  the  supervision and with the participation of the Company's
management,  including  the  Company's Chief Executive Officer and the Company's
Chief Financial Officer, of the effectiveness of the design and operation of the
Company's  disclosure  controls  and  procedures.  Based on this evaluation, the
Company's Chief Executive Officer and Chief Financial Officer concluded that the
Company's  disclosure  controls and procedures were effective in timely alerting
them  to material information relating to the Company required to be included in
the  Company's periodic filings with the Securities and Exchange Commission.  It
should  be  noted  that  in designing and evaluating the disclosure controls and
procedures,  management  recognized  that any controls and procedures, no matter
how  well  designed  and  operated,  can  provide  only  reasonable assurance of
achieving  the  desired  control  objectives,  and  management  necessarily  was
required  to  apply  its judgment in evaluating the cost-benefit relationship of
possible  controls  and  procedures.

There  have been no significant changes in the Company's internal controls or in
other  factors  that could significantly affect the internal controls subsequent
to  the  date  the  Company  completed  its  evaluation.


                                       13
<PAGE>
                           PART II - OTHER INFORMATION

Item  6.  Exhibits  and  Reports  on  Form  8-K.
          -------------------------------------

(a)  Exhibits:

     3.1  Restated  Certificate of Incorporation of the Company (incorporated by
          reference  to  the  Registration  Statement  filed  on  Form  S-1,
          Registration  No.  33-13050).

     3.2  By-Laws  of the Company (incorporated by reference to the Registration
          Statement  filed  on  Form  S-1,  Registration  No.  33-13050).

     4.1  Specimen  Common  Stock  certificate (incorporated by reference to the
          Registration  Statement filed on Form S-1, Registration No. 33-13050).

     4.2  Rights  Agreement  (incorporated by reference to the Company's Current
          Report  on  Form  8-K  filed  on  April  18,  1997).

(b)  Reports  on  Form  8-K.  The  Company  did not file any reports on Form 8-K
     during  the  quarter  ended  March  31,  2003.


                                       14
<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.

                                         CRITICARE  SYSTEMS,  INC.
                                               (Registrant)

Date:  May  14,  2003                    BY   /s/  Michael  J.  Sallmann
                                            -----------------------------------
                                              Michael  J.  Sallmann
                                              Vice  President  -  Finance
                                              (Chief  Accounting  Officer  and
                                              Duly  Authorized  Officer)


                                       15
<PAGE>

                                 CERTIFICATIONS
                                 --------------


I,  Emil  H.  Soika, President and Chief Executive Officer of Criticare Systems,
Inc.,  certify  that:

     1.     I  have  reviewed  this  quarterly  report on Form 10-Q of Criticare
Systems,  Inc.;

     2.     Based  on  my  knowledge, this quarterly report does not contain any
untrue  statement  of a material fact or omit to state a material fact necessary
to  make  the  statements  made,  in light of the circumstances under which such
statements  were made, not misleading with respect to the period covered by this
quarterly  report;

     3.     Based on my knowledge, the financial statements, and other financial
information  included  in  this quarterly report, fairly present in all material
respects  the  financial  condition, results of operations and cash flows of the
registrant  as  of,  and  for,  the  periods presented in this quarterly report;

     4.     The  registrant's other certifying officer and I are responsible for
establishing  and  maintaining disclosure controls and procedures (as defined in
Exchange  Act  Rules  13a-14  and  15d-14)  for  the  registrant  and  we  have:

          (a)     designed  such  disclosure  controls  and procedures to ensure
that material information relating to the registrant, including its consolidated
subsidiaries,  is made known to us by others within those entities, particularly
during  the  period  in  which  this  quarterly  report  is  being  prepared;

          (b)     evaluated  the  effectiveness  of  the registrant's disclosure
controls  and procedures as of a date within 90 days prior to the filing date of
this  quarterly  report  (the  "Evaluation  Date");  and

          (c)     presented  in  this quarterly report our conclusions about the
effectiveness  of the disclosure controls and procedures based on our evaluation
as  of  the  Evaluation  Date;

     5.     The  registrant's  other  certifying  officer  and I have disclosed,
based  on our most recent evaluation, to the registrant's auditors and the audit
committee  of  registrant's  board  of  directors  (or  persons  performing  the
equivalent  function):

          (a)     all  significant  deficiencies  in  the design or operation of
internal  controls  which  could  adversely  affect  the registrant's ability to
record, process, summarize and report financial data and have identified for the
registrant's  auditors  any  material  weaknesses  in  internal  controls;  and


                                       16
<PAGE>
          (b)     any  fraud,  whether or not material, that involves management
or  other  employees  who  have  a significant role in the registrant's internal
controls;  and

     6.     The  registrant's  other  certifying officer and I have indicated in
this  quarterly report whether or not there were significant changes in internal
controls  or  in other factors that could significantly affect internal controls
subsequent  to  the date of our most recent evaluation, including any corrective
actions  with  regard  to  significant  deficiencies  and  material  weaknesses.

          Date:  May  14,  2003


                                              /s/ Emil H. Soika
                                           -------------------------------------
                                           Emil  H.  Soika
                                           President and Chief Executive Officer

                                       17
<PAGE>
                                 CERTIFICATIONS
                                 --------------


I,  Michael  J.  Sallmann,  Vice  President - Finance and Secretary of Criticare
Systems,  Inc.,  certify  that:

     1.     I  have  reviewed  this  quarterly  report on Form 10-Q of Criticare
Systems,  Inc.;

     2.     Based  on  my  knowledge, this quarterly report does not contain any
untrue  statement  of a material fact or omit to state a material fact necessary
to  make  the  statements  made,  in light of the circumstances under which such
statements  were made, not misleading with respect to the period covered by this
quarterly  report;

     3.     Based on my knowledge, the financial statements, and other financial
information  included  in  this quarterly report, fairly present in all material
respects  the  financial  condition, results of operations and cash flows of the
registrant  as  of,  and  for,  the  periods presented in this quarterly report;

     4.     The  registrant's other certifying officer and I are responsible for
establishing  and  maintaining disclosure controls and procedures (as defined in
Exchange  Act  Rules  13a-14  and  15d-14)  for  the  registrant  and  we  have:

          (a)     designed  such  disclosure  controls  and procedures to ensure
that material information relating to the registrant, including its consolidated
subsidiaries,  is made known to us by others within those entities, particularly
during  the  period  in  which  this  quarterly  report  is  being  prepared;

          (b)     evaluated  the  effectiveness  of  the registrant's disclosure
controls  and procedures as of a date within 90 days prior to the filing date of
this  quarterly  report  (the  "Evaluation  Date");  and

          (c)     presented  in  this quarterly report our conclusions about the
effectiveness  of the disclosure controls and procedures based on our evaluation
as  of  the  Evaluation  Date;

     5.     The  registrant's  other  certifying  officer  and I have disclosed,
based  on our most recent evaluation, to the registrant's auditors and the audit
committee  of  registrant's  board  of  directors  (or  persons  performing  the
equivalent  function):

          (a)     all  significant  deficiencies  in  the design or operation of
internal  controls  which  could  adversely  affect  the registrant's ability to
record, process, summarize and report financial data and have identified for the
registrant's  auditors  any  material  weaknesses  in  internal  controls;  and

          (b)     any  fraud,  whether or not material, that involves management
or  other  employees  who  have  a significant role in the registrant's internal
controls;  and


                                       18
<PAGE>
     6.     The  registrant's  other  certifying officer and I have indicated in
this  quarterly report whether or not there were significant changes in internal
controls  or  in other factors that could significantly affect internal controls
subsequent  to  the date of our most recent evaluation, including any corrective
actions  with  regard  to  significant  deficiencies  and  material  weaknesses.

          Date:  May  14,  2003


                                            /s/ Michael J. Sallman
                                         ---------------------------------------
                                         Michael  J.  Sallmann
                                         Vice  President - Finance and Secretary


                                       19