<PAGE>   1
                                    FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

(Mark One)
    X          QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                  For the quarterly period ended June 30, 2001

                                       OR
                TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                        For the transition period from      to

                         For Quarter Ended June 30, 2001

                          Commission file number 1-9915

                          GAYLORD CONTAINER CORPORATION
             (Exact name of registrant as specified in its charter)

          Delaware                                               36-3472452
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)

                          500 Lake Cook Road, Suite 400
                            Deerfield, Illinois 60015
                            Telephone: (847) 405-5500
          (Address, including zip code, and telephone number, including
                  area code, of registrant's principal offices)


         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 ___

         As of August 2, 2001, the registrant had outstanding 55,953,752 shares
of its $0.0001 par value Class A Common Stock (including 827,135 shares held in
trust for the benefit of the warrant holders) and 827,135 redeemable
exchangeable warrants to obtain Class A Common Stock.

<PAGE>   2




GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

                                                                          PAGE
PART I.        FINANCIAL INFORMATION                                     NUMBERS

Item 1.        Financial Statements                                        1 - 9

Item 2.        Management's Discussion and Analysis of
               Financial Condition and Results of Operations             10 - 17

PART II.       OTHER INFORMATION

Item 1.        Legal Proceedings                                              18

Item 2.        Changes in Securities                                          18

Item 3.        Defaults Upon Senior Securities                                18

Item 4.        Submission of Matters to a Vote of Security
               Holders                                                        18

Item 5.        Other Information                                              18

Item 6.        Exhibits and Reports on Form 8-K                               18


SIGNATURES                                                                    19




<PAGE>   3


GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS
JUNE 30, 2001 AND SEPTEMBER 30, 2000
--------------------------------------------------------------------------------


                                                        JUNE 30    SEPTEMBER 30,
$ in millions, except per share data                     2001         2000
--------------------------------------------------------------------------------

ASSETS
Current assets:
   Cash and equivalents                            $      9.7      $      0.7
   Trade receivables (less allowances of $7.8 for
       2001 and 2000)                                   139.9           149.6
   Inventories (Note 2)                                 104.2            92.6
   Other current assets                                  35.0            18.2
--------------------------------------------------------------------------------
     Total current assets                               288.8           261.1
--------------------------------------------------------------------------------
Property, plant and equipment:                        1,141.3         1,179.9
Less accumulated depreciation                          (584.2)         (604.9)
--------------------------------------------------------------------------------
   Property - net                                       557.1           575.0
Deferred income taxes                                   155.5           147.1
Other assets                                             48.2            51.0
--------------------------------------------------------------------------------
Total                                              $  1,049.6      $  1,034.2
--------------------------------------------------------------------------------

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
   Current maturities of long-term debt            $      8.2      $     16.9
   Trade payables                                        55.8            59.9
   Accrued interest payable                              12.8            16.7
   Accrued and other liabilities                         58.3            68.8
--------------------------------------------------------------------------------
     Total current liabilities                          135.1           162.3
--------------------------------------------------------------------------------
Long-term debt                                          966.1           911.2
Other long-term liabilities                              48.7            47.5
Commitments and contingencies (Note 3)                     --              --
Stockholders' equity (deficit)
   Class A common stock-par value, $0.0001
    per share; authorized 125,000,000 shares;
    issued 57,168,694 shares and
    55,223,694 shares, respectively, and
    outstanding 55,934,589 shares and
    53,829,101 shares, respectively                        --              --
   Capital in excess of par value                       180.0           179.1
   Accumulated deficit                                 (269.7)         (254.9)
   Common stock in treasury - at cost;
    1,234,105 shares and 1,394,593 shares,
    respectively                                         (9.1)          (10.3)
   Accumulated other comprehensive income (loss):
    Unrealized holding losses                            (0.8)             --
    Minimum pension liability                            (0.7)           (0.7)
--------------------------------------------------------------------------------
     Total stockholders' equity (deficit)              (100.3)          (86.8)
--------------------------------------------------------------------------------
Total                                              $  1,049.6      $  1,034.2
--------------------------------------------------------------------------------
See notes to condensed consolidated financial statements.

                                       1
<PAGE>   4

GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED
JUNE 30, 2001 AND 2000 (In millions, except per share data)
--------------------------------------------------------------------------------

                                                        THREE MONTHS ENDED
                                                             JUNE 30
In millions, except per share data                        2001        2000
================================================================================

Net sales                                              $   263.6  $   299.2
Cost of goods sold                                         226.3      245.6
--------------------------------------------------------------------------------
   Gross margin                                             37.3       53.6
Selling and administrative costs                           (25.3)     (30.3)
--------------------------------------------------------------------------------
   Operating earnings                                       12.0       23.3
Interest expense - net                                     (22.2)     (23.1)
Other income - net                                           0.6        0.4
--------------------------------------------------------------------------------
   Income (loss) before taxes                               (9.6)       0.6
Income tax benefit (expense)                                 3.8       (0.2)
--------------------------------------------------------------------------------
   Net income (loss)                                        (5.8)       0.4
--------------------------------------------------------------------------------
Other comprehensive loss, net of tax                        (1.0)        --
--------------------------------------------------------------------------------
   Comprehensive income (loss)                         $    (6.8) $     0.4
================================================================================

ACCUMULATED DEFICIT:
  Beginning of period                                  $  (263.6)
  Net loss                                                  (5.8)
  Excess of cost over issuance price of
    treasury stock                                          (0.3)
                                                       ----------
  End of period                                        $  (269.7)
                                                       ==========

INCOME (LOSS) PER COMMON SHARE
  Basic                                                $    (0.10)  $     0.01
                                                       ===========  ==========
  Diluted (A)                                                N/A    $     0.01
                                                       ===========  ==========

WEIGHTED AVERAGE COMMON AND COMMON SHARE EQUIVALENTS

BASIC:
  WEIGHTED AVERAGE COMMON SHARES OUTSTANDING                55.9          53.8

DILUTED:
  EFFECT OF DILUTIVE SECURITIES:
     Employee and director stock options                      --           0.2
                                                       -----------  ----------

Weighted average common and common
  share equivalents                                         55.9          54.0
                                                       ===========  ==========


(A) Not presented where the effect of potential shares is antidilutive.

    See notes to condensed consolidated financial statements.

                                       2
<PAGE>   5

GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE NINE MONTHS ENDED
JUNE 30, 2001 AND 2000 (In millions, except per share data)
--------------------------------------------------------------------------------


                                                            NINE MONTHS ENDED
                                                                JUNE 30
In millions, except per share data                         2001        2000
================================================================================

Net sales                                                 $ 824.5     $ 870.0
Cost of goods sold                                          701.6       720.9
--------------------------------------------------------------------------------
   Gross margin                                             122.9       149.1
Selling and administrative costs                            (78.6)      (85.7)
--------------------------------------------------------------------------------
   Operating earnings                                        44.3        63.4
Interest expense - net                                      (67.5)      (68.2)
Other income - net                                            1.5         1.4
--------------------------------------------------------------------------------
   Loss before taxes and accounting change                  (21.7)       (3.4)
Income tax benefit                                            7.7         1.3
--------------------------------------------------------------------------------
Loss before accounting change                               (14.0)       (2.1)
Accounting change (Note 4)                                    0.1          --
--------------------------------------------------------------------------------
   Net loss                                                 (13.9)       (2.1)
--------------------------------------------------------------------------------
Other comprehensive loss, net of tax                         (0.8)         --
--------------------------------------------------------------------------------
   Comprehensive loss                                     $ (14.7)    $  (2.1)
================================================================================

ACCUMULATED DEFICIT:
  Beginning of Period                                     $(254.9)
  Net loss                                                  (13.9)
  Excess of cost over issuance price of
    treasury stock                                           (0.9)
                                                          --------
  End of Period                                           $(269.7)
                                                          ========

LOSS PER COMMON SHARE
  Basic                                                   $ (0.25)    $ (0.04)
                                                           ========    ========
  Diluted (A)                                                N/A         N/A
                                                           ========    ========

WEIGHTED AVERAGE COMMON AND COMMON SHARE EQUIVALENTS

BASIC:
  WEIGHTED AVERAGE COMMON SHARES OUTSTANDING                 55.6        53.7

DILUTED:
  EFFECT OF DILUTIVE SECURITIES:
     Employee and director stock options                       --         0.3
                                                           --------    --------

Weighted average common and common
  share equivalents                                          55.6        54.0
                                                           ========    ========


(A) Not presented where the effect of potential shares is antidilutive.

    See notes to condensed consolidated financial statements.

                                       3
<PAGE>   6

GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED
JUNE 30, 2001 AND 2000
--------------------------------------------------------------------------------
                                                NINE MONTHS ENDED JUNE 30,
$ in millions                                        2001        2000
===============================================================================

CASH FLOWS FROM OPERATIONS:
Net loss                                             $ (13.9) $  (2.1)
Adjustments to reconcile net loss to net
  cash (used in) provided by operations:
    Depreciation and amortization                       41.2     39.6
    Deferred tax expense                                (7.7)    (1.1)
    Change in current assets and liabilities,
      excluding acquisitions and dispositions          (38.5)   (26.5)
    Other - net                                          1.1      2.6
--------------------------------------------------------------------------------
Net cash (used in) provided by operations              (17.8)    12.5
--------------------------------------------------------------------------------
CASH FLOWS FROM INVESTMENTS:
  Capital expenditures                                 (21.4)   (28.2)
  Capitalized interest                                  (0.5)    (0.4)
  Proceeds from asset sales                              2.3       --
  Acquisition - net                                       --      1.4
  Other investments - net                                0.3     (1.0)
--------------------------------------------------------------------------------
Net cash used in investments                           (19.3)   (28.2)
--------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING:
  Senior debt repayments                               (14.1)    (4.9)
  Revolving credit agreement borrowings - net           60.0     57.0
  Repayment of S&G Packaging revolving credit loan        --    (32.6)
  Other financing - net                                  0.2     (1.1)
--------------------------------------------------------------------------------
Net cash provided by financing                          46.1     18.4
--------------------------------------------------------------------------------
Net increase in cash and equivalents                     9.0      2.7
Cash and equivalents, beginning of period                0.7     10.4
--------------------------------------------------------------------------------
Cash and equivalents, end of period                  $   9.7  $  13.1
================================================================================
SUPPLEMENTAL CASH FLOW DISCLOSURES:
Cash paid for interest expense                       $  69.6  $  70.0
Cash paid for income taxes                           $   0.1  $    --
Supplemental schedule of non-cash
   investing and financing activities:
    Acquisition of S&G Packaging:
     Inventories                                     $    --  $  28.7
     Property additions                              $    --  $  35.1
     Other assets                                    $    --  $  15.1
     Trade payables, accrued and other
        liabilities                                  $    --  $  47.8
     Total debt assumed before repayment             $    --  $  32.6


See notes to condensed consolidated financial statements.

                                       4
<PAGE>   7
GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. GENERAL

In the opinion of management, the accompanying unaudited condensed consolidated
financial statements include all normal and recurring adjustments and accruals
necessary to present fairly the financial position as of June 30, 2001 and the
results of operations for the three months and nine months ended June 30, 2001
and 2000, and cash flows for the nine months ended June 30, 2001 and 2000,
including all the accounts of Gaylord Container Corporation (including its
subsidiaries, the Company), and are in conformity with Securities and Exchange
Commission Rule 10-01 of Regulation S-X. The financial statements should be read
in conjunction with the audited consolidated financial statements and the notes
thereto on Form 10-K for the fiscal year ended September 30, 2000.

2. INVENTORIES

Inventories consist of:

                                                JUNE 30,           September 30,
                                                --------------------------------
In millions                                       2001                2000
--------------------------------------------------------------------------------
Finished products                               $ 29.7               $ 29.1
In process                                        60.7                 53.2
Raw materials                                     11.9                  6.7
Supplies                                          15.5                 14.9
--------------------------------------------------------------------------------
                                                 117.8                103.9
LIFO valuation adjustment                        (13.6)               (11.3)
--------------------------------------------------------------------------------
  Total                                        $ 104.2               $ 92.6
================================================================================

3. CONTINGENCIES

The Company has a contract to sell electricity from its cogeneration facility to
Pacific Gas & Electric ("PG&E") through 2013. The contract requires the Company
to supply electricity during June, July and August at specified rates with a
penalty for non-compliance of approximately $7 million. In April 2001, the
Company had an outstanding receivable amount, for electricity sales, of $6.5
million when PG&E filed for protection under Chapter 11 of the U. S. Bankruptcy
Code. In July 2001, the Company entered into a one-year agreement with PG&E,
that has been approved by the Bankruptcy Court, which provides that the Company
will continue to sell PG&E electricity per the terms of the original contract.
The Company continues to believe substantially all amounts due from PG&E will be
collected.




                                       5
<PAGE>   8

GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-CONTINUED

The Company is not a party to any legal proceedings other than litigation
incidental to normal business activities, except as described below:

On October 23, 1995, a rail tank car exploded on the premises of the Bogalusa,
Louisiana plant of Gaylord Chemical Corporation, a wholly owned, independently
operated subsidiary of the Company. The accident resulted in the venting of
certain chemicals, including by-products of nitrogen tetroxide, a raw material
used by the plant to produce dimethyl sulfoxide, a solvent used in the
manufacture of pharmaceutical and agricultural chemicals. More than 160 lawsuits
have been filed in both federal and state courts naming as defendants Gaylord
Chemical Corporation and/or the Company, certain of their respective officers
and other unrelated corporations and individuals. The lawsuits, which seek
unspecified damages, allege personal injury, property damage, economic loss,
related injuries and fear of injuries as a result of the accident. On April 1,
1996, the federal judge dismissed all but one of the federal actions for failing
to state claims under federal law and remanded the remaining state law claims to
the district court in Washington Parish, Louisiana, where they have been
consolidated. Discovery in the remaining federal action, a suit to recover
alleged clean-up costs, was ordered coordinated with the Louisiana State action.

Under an agreed Case Management Order, all actions in Louisiana arising out of
the October 23, 1995, accident were consolidated in the Twenty-Third Judicial
district in Washington Parish, Louisiana, where plaintiffs filed a single
Consolidated Master Petition (CMP) against Gaylord Chemical Corporation, the
Company and twenty-one other defendants.

The CMP, as amended, asserts substantially all of the claims and theories made
in prior lawsuits, including negligence, strict liability and other statutory
liability. Compensatory and punitive damages are sought. No officers or
directors of Gaylord Chemical Corporation or the Company are named defendants in
the CMP, as amended. The status of all lawsuits pending before the filing of the
CMP, some of which name officers of Gaylord Chemical Corporation and the
Company, will be determined by the trial court after class certification issues
are finally resolved.

In November 1997, the Louisiana trial court certified these consolidated cases
as a class action. The trial court certified, and the Court of Appeal and State
Supreme Court upheld, a class consisting of allegedly injured parties in the
City of Bogalusa and portions of Washington Parish, Louisiana, and parts of
Marion, Walthall and Pike counties in Mississippi. The trial court did not
certify a single, mandatory class for punitive damages.

                                       6
<PAGE>   9

GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-CONTINUED

The trial court required all persons who claim exposure within the class
boundaries to complete and file proofs by June 21, 2000. By that deadline,
16,592 persons filed proof of claim forms. In addition, 3,978 persons "opted
out" of the Louisiana class proceeding. All but 12 of the-opt out claimants are
also plaintiffs in the Mississippi action described below. On July 21, 2000, 18
initial trial plaintiffs were selected at random from the class claimants based
on their claimed locations of exposure. The claims of these 18 are scheduled for
trial in June 2002. The liability results of this first phase will bind all
class members and defendants. For any defendant found liable for punitive
damages a second phase punitive damage trial will begin one week later. In this
second phase, the jury will be asked to award punitive damages, if any, for the
entire Louisiana class. The Company and Gaylord Chemical are vigorously
contesting all claims arising out of the October 23, 1995, explosion.

The Company, Gaylord Chemical Corporation and numerous other third-party
companies have been named as defendants in 13 actions brought by plaintiffs in
Mississippi State Court, who claim injury as a result of the October 23, 1995,
accident at the Bogalusa facility. These cases, which purport to be on behalf of
over 11,000 individuals, were not filed as a class action but rather were
consolidated before a single judge in Hinds County, Mississippi. All of these
cases allege claims and damages similar to those in Louisiana State Court.
Discovery in the consolidated cases has been coordinated with the on-going
discovery in the Louisiana class action. Following several rulings by the
Mississippi trial court, over 7,000 individuals' claims in these consolidated
actions were either dismissed or voluntarily withdrawn. As with the Louisiana
class action, the Company and Gaylord Chemical Corporation are vigorously
contesting all claims in Mississippi arising out of the October 23, 1995,
accident. In addition, the Company and Gaylord Chemical Corporation filed
cross-claims for indemnity and contribution against co-defendants in both of the
Mississippi and Louisiana actions.

The Mississippi trial court selected the first 20 plaintiffs whose claims were
tried to a jury on all issues of liability and damages beginning on March 29,
1999, and ending on June 23, 1999. During trial, the court dismissed with
prejudice the claims of three plaintiffs. The jury found Gaylord Chemical
Corporation and a co-defendant, Vicksburg Chemical Company, equally at fault for
the accident. The jury also found that none of the 17 remaining plaintiffs whose
claims went to the jury had suffered any damages, awarded no damages to any of
them, and returned a verdict in favor of all defendants. The jury also
determined that the Company was not responsible for the conduct of its
subsidiary, Gaylord Chemical Corporation. Plaintiffs' motions for a new trial
or, alternatively, judgment notwithstanding the verdict were all denied.
Plaintiffs did not timely appeal the

                                       7
<PAGE>   10

GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-CONTINUED

verdict or the trial court's rulings. The trial court has ordered that the
results of the first trial will not be binding, either as to liability or
compensatory or punitive damages, on any of the other plaintiffs in the
Mississippi consolidated actions. Rather, the trial court ordered that each of
the approximately 4,000 Mississippi plaintiffs will be required to prove their
own individual claims of liability or compensatory or punitive damages. The
trial court has set a trial date of January 15, 2002 for the next group of 20
Mississippi plaintiffs.

The Company and Gaylord Chemical Corporation maintain general liability
insurance and filed separate suits seeking a declaratory judgment of coverage
for the October 23, 1995, accident against their general liability and directors
and officers liability insurance carriers. The carrier with the first layer of
coverage under the general liability policies has agreed to pay the Company's
and Gaylord Chemical Corporation's defense costs under a reservation of rights.

The coverage action against the liability insurers was tried to a judge in
December 1998. During trial, one of the excess carriers settled by agreeing to
pay $5 million, its full policy limits. Trial concluded against the remaining
defendants on December 10, 1998, and on February 25, 1999, the trial court
issued an opinion holding that the Company and Gaylord Chemical Corporation have
insurance coverage for the October 23, 1995, accident under eight of the nine
remaining policies. The judge held that language in one policy excluded
coverage. The eight insurers issuing policies where coverage was found appealed
the judgment to the Louisiana Court of Appeal. The Company and Gaylord Chemical
Corporation appealed that portion of the judgment excluding coverage under one
policy. On April 3, 2001 the Louisiana Court of Appeal affirmed the trial
court's finding that coverage was afforded by eight of the nine carriers. In
addition, the Court of Appeal reversed the trial court's finding that the ninth
carrier's policy did not afford coverage, and held that the Company and Gaylord
Chemical Corporation have insurance coverage under all nine policies. Certain
insurers' motion for a re-hearing in the Court of Appeal was denied on July 16,
2001. Following the Court of Appeal's April 3, 2001 opinion, the Company and
Gaylord Chemical Corporation had in excess of $125 million in insurance coverage
for the October 23, 1995, accident.

On May 4, 2001, the Company and Gaylord Chemical Corporation agreed in principle
to settle all claims arising out of the October 23, 1995 explosion. In exchange
for payments by some of its insurance carriers and assignment of the Company's
insurance coverage action against the remaining carriers, the Company and
Gaylord Chemical Corporation will receive full releases and/or dismissals of all
claims for damages, including punitive damages. Neither the Company nor Gaylord
Chemical Corporation contributed to the settlement, the terms of which remain
confidential. The settlement is subject to the completion of satisfactory
documentation and court approval.

                                       8
<PAGE>   11

GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONCLUDED

On May 18 and May 24, 1999, the Company was named in lawsuits consolidated in
the Federal District Court for the Eastern District of Pennsylvania alleging
civil violations of Section 1 of the Sherman Act. The complaints, both putative
class actions, allege that during the period October 1, 1993, through November
30, 1995, the Company agreed with nine other manufacturers of linerboard to
raise or maintain prices. According to the complaints, the purpose and effect of
the alleged conspiracy was to artificially increase prices of corrugated sheets
and corrugated boxes sold to customers. Treble damages and attorney fees are
sought. Motions to dismiss the complaints were denied, and class certification
is pending. After investigation of the facts, the Company believes the
allegations are without merit and is vigorously defending itself.

The Company believes the outcome of such litigation will not have a material
adverse effect on the Company's financial position, results of operations or
cash flows.


4. ADOPTION OF NEW ACCOUNTING STANDARDS

Effective October 1, 2000, the Company adopted Statement of Financial Accounting
Standards No. 133, "Accounting for Derivative Instruments and Hedging
Activities", as amended, which establishes accounting and reporting
standards for derivative instruments. The cumulative effect of this accounting
change was income, net of taxes, of $0.1 million.

In July 2001, the Financial Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards ("SFAS") No. 141, "Business Combinations,",
which establishes accounting and reporting standards for business combinations.
Also, in July 2001 FASB issued SFAS 142, "Goodwill and Other Intangible
Assets," which establishes accounting and reporting for goodwill and other
intangible assets. The Company is in the process of determining what effect, if
any, these statements will have on its results of operations or financial
position.

                                       9
<PAGE>   12
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

RESULTS OF OPERATIONS

THIRD QUARTER OF FISCAL 2001 COMPARED WITH THIRD QUARTER OF FISCAL 2000

Net sales for the third quarter of fiscal 2001 were $263.6 million compared to
net sales of $299.2 million for the third quarter of fiscal 2000. Operating
income for the current quarter was $12.0 million compared to operating income of
$23.3 million for the year-ago quarter. Net loss for the current quarter totaled
$5.8 million, or $0.10 per basic common share, compared to net income of $0.4
million, or $0.01 per basic common share, for the year-ago quarter.

In the third quarter of fiscal 2001, sales decreased approximately $36 million
due to lower volume ($26 million) and lower average net selling prices for most
of the Company's paper products ($10 million). Weaker domestic economic
conditions and the strength of the U. S. dollar versus foreign currencies
were the causes for the reduced volume and lower selling prices.

Gross margin for the third quarter of fiscal 2001 decreased to $37.3 million
from $53.6 million in the prior-year quarter primarily due to lower average net
selling prices ($11 million, including $1 million of higher containerboard and
kraft paper costs), lower volume ($9 million) and higher energy costs ($10
million) partially offset by lower fiber costs ($15 million).

Corrugated shipments decreased 5 percent in the third quarter of fiscal 2001 to
3.7 billion square feet compared to 3.9 billion square feet in the year-ago
quarter. Industrial and retail bag shipments decreased 13 percent to 69.4
thousand tons during the third quarter of fiscal 2001 from 80.0 thousand tons in
the prior-year quarter. Total mill production decreased by 6 percent to 3,996
tons per day (TPD, calculated on the basis of the number of days in the period)
during the third quarter of fiscal 2001 compared to 4,234 TPD in the prior-year
quarter, primarily due to market-related downtime. Quarter-over-quarter,
containerboard production decreased by 4 percent to 3,332 TPD from 3,481 TPD
while unbleached kraft paper production decreased by 12 percent to 664 TPD from
753 TPD, over the prior-year period.

Average net selling prices for corrugated products and retail bags both
decreased by 5 percent while average net selling prices for multiwall bags
increased by 7 percent in the third quarter of fiscal 2001 compared with the
prior-year quarter. Average net selling prices on sales of the Company's
domestic linerboard and export linerboard decreased by 11 percent and 16
percent,

                                       10
<PAGE>   13
respectively, while average net selling prices on sales of unbleached kraft
paper increased 11 percent in the third quarter of fiscal 2001 compared to the
same quarter in the prior year.

Fiber costs decreased due to lower average delivered costs for recycled fiber
(which consists primarily of old corrugated containers (OCC) and double lined
kraft (DLK) clippings) and wood chips. The average delivered cost of OCC and DLK
decreased approximately 56 percent and 52 percent, respectively, while the
average delivered cost of wood chips decreased by 2 percent in
quarter-over-quarter comparisons.

Energy costs increased primarily due to increases in natural gas prices. Average
natural gas prices increased 124 percent in the third quarter of fiscal 2001
compared to the same fiscal quarter in the prior year.

Selling and administrative costs were $25.3 million for the current quarter
compared to $30.3 million for the year-ago period. This decrease was primarily
due to staff reductions, reduced consultant expenditures, lower incentive costs,
additional centralized purchasing activities and reduced expense due to
integrating S&G Packaging within the Company.

Net interest expense decreased to $22.2 million in the third quarter of fiscal
2001 from $23.1 million in the prior-year quarter.  Lower average borrowing
rates and lower average debt levels decreased interest expense by $0.5 million
and $0.4 million, respectively.

In the third quarter of fiscal 2001, the Company recognized a tax benefit of
$3.8 million compared to tax expense of $0.2 million in the prior-year quarter.
The effective tax rate was 39 percent in the third quarter of fiscal 2001 and 38
percent in the third quarter of 2000.

                                       11
<PAGE>   14
FIRST NINE MONTHS OF FISCAL 2001 COMPARED WITH FIRST NINE MONTHS OF FISCAL 2000.

Net sales for the first nine months of fiscal 2001 were $824.5 million compared
to net sales of $870.0 million for the first nine months of fiscal 2000.
Operating income for the current nine-month period was $44.3 million compared to
an operating income of $63.4 million for the year-ago period. Net loss for the
current period totaled $13.9 million, or $0.25 per basic common share, compared
to a net loss of $2.1 million, or $0.04 per basic common share, for the year-ago
period.

In the first nine months of fiscal 2001, sales decreased by approximately $45.5
million due to lower volume ($59 million), primarily as a result of weaker
domestic economic conditions and the strength of the U. S. dollar versus foreign
currencies, partially offset by higher average net selling prices ($14 million).

Gross margin for the first nine months of fiscal 2001 decreased to $122.9
million from $149.1 million in the prior-year period primarily due to higher
energy costs ($32 million) and lower volume ($29 million). These losses were
partially offset by higher average net selling prices ($4 million net of $10
million higher paper costs in the converting facilities) and lower fiber costs
($33 million).

Corrugated shipments decreased by approximately 5 percent in the first nine
months of fiscal 2001 to 11.0 billion square feet compared to 11.6 billion
square feet in the year-ago period, primarily as a result of weaker domestic
economic conditions in the second and third fiscal quarters of 2001. Industrial
and retail bag shipments increased to 225.4 thousand tons during the first nine
months of fiscal 2001 from 223.9 thousand tons in the prior-year period
primarily due to the inclusion of S&G Packaging shipments for all nine months in
fiscal 2001 in contrast to eight months in fiscal 2000. S&G Packaging became a
wholly owned subsidiary of the Company on October 28, 1999. Total mill
production decreased by 7 percent to 3,975 TPD during the first nine months of
fiscal 2001 compared to 4,287 TPD in the prior-year period. The majority of the
decrease in production was attributable to market-related downtime. Period over
period, containerboard and unbleached kraft paper production both decreased by 7
percent to 3,268 TPD from 3,525 TPD and to 707 TPD from 762 TPD, respectively,
over the prior-year period.

Average net selling prices for corrugated products and multiwall bags increased
by 3 percent and 6 percent, respectively, while average net selling prices for
retail bags decreased by 4 percent in the first nine months of fiscal 2001
compared with the

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<PAGE>   15
prior-year period. Average net selling prices for the Company's domestic
linerboard and export linerboard decreased by 1 percent and 9 percent,
respectively, while unbleached kraft paper increased 8 percent in the first nine
months of fiscal 2001 compared to the same period in the prior year.

Fiber costs decreased due to lower average delivered costs for recycled fiber
and wood chips. The average delivered cost of OCC and DLK decreased by 43
percent and 48 percent, respectively, while the average delivered cost of wood
chips decreased by 4 percent in period-over-period comparisons.

Energy costs increased primarily due to an increase in natural gas prices.
Average natural gas prices increased 145 percent in the current period of fiscal
2001 compared to the same period in the prior year.

Selling and administrative costs were $78.6 million for the first nine months of
fiscal 2001 compared to $85.7 million for the year-ago period. This decrease was
primarily due to staff reductions, reduced consultant expenditures, lower
incentive costs, additional centralized purchasing activities and reduced
expense due to integrating S&G Packaging within the Company.

Net interest expense decreased to $67.5 million in the first nine months of
fiscal 2001 from $68.2 million in the prior-year period. Lower average debt
levels decreased interest expense by $1.1 million, while higher average
borrowing rates increased interest expense by $0.4 million.

In the first nine months of fiscal 2001, the Company recognized a tax benefit of
$7.7 million compared to $1.3 million in the prior-year period. The effective
tax rates were 36 and 38 percent, respectively, in the period-over-period
comparison. The change in the tax rate was due to the relative level of
permanent differences between book and taxable income.

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<PAGE>   16

LIQUIDITY AND CAPITAL RESOURCES

GENERAL

The Company has historically financed its operations from cash provided by
operations, borrowings under its credit agreements and the issuance of debt and
equity securities. The Company's principal uses of cash are to pay operating
expenses, fund capital expenditures and service debt. The Company is prohibited
from paying dividends and making additional purchases of its common stock by the
terms of its bank credit agreement and public debt securities.

Net cash used in operations for the first nine months of fiscal 2001 was $17.8
million, compared with net cash provided by operations of $12.5 million for the
year-ago period. Approximately $12 million of the unfavorable change was due to
reduced operating results and $12 million was due to higher working
capital requirements.

Cash flows used in investing activities decreased in the first nine months of
fiscal 2001 to $19.3 million from $28.2 million in the year-ago period primarily
due to a $6.8 million decrease in capital expenditures.

Cash flows provided by financing activities increased to $46.1 million in the
first nine months of fiscal 2001 from $18.4 million in the year-ago period.
Revolver borrowings in the fiscal 2001 nine-month period increased to support
the cash used in operations.

LIQUIDITY

At June 30, 2001, the Company had cash and equivalents of $9.7 million, an
increase of $9.0 million from September 30, 2000, as cash provided by financing
activities exceeded cash used in operating and investing activities. Total debt
increased $46.2 million to $974.3 million at June 30, 2001 from $928.1 million
at September 30, 2000. At June 30, 2001, the Company had $178 million of
borrowings outstanding, and $77.4 million of credit available under the
revolving portions of its credit agreements.

The Company has a contract to sell electricity from its cogeneration facility to
Pacific Gas & Electric ("PG&E") through 2013. The contract requires the Company
to supply electricity during June, July and August at specified rates with a
penalty

                                       14
<PAGE>   17

for non-compliance of approximately $7 million. In April 2001, the Company had
an outstanding receivable amount, for electricity sales, of $6.5 million when
PG&E filed for protection under Chapter 11 of the U. S. Bankruptcy Code. In July
2001, the Company has entered into a one-year agreement with PG&E, that has been
approved by the Bankruptcy Court, which provides that the Company will continue
to sell PG&E electricity per the terms of the original contract. The Company
continues to believe substantially all amounts due from PG&E will be collected.

At June 30, 2001, the Company had primary working capital (Trade receivables
plus Inventories less Trade payables) of $188.3 million, an increase of $6.0
million from September 30, 2000 due to higher Raw materials inventory and lower
Trade payables offset by lower Trade receivables.

Consolidation among major containerboard industry producers has resulted in the
reduction of domestic containerboard capacity. This rationalization, combined
with limited new containerboard capacity additions and market related downtime
has resulted in relatively balanced industry supply/demand conditions despite
weak domestic and export demand. Due to the weak demand, published industry
prices for linerboard declined $15 per ton in January 2001 and an additional
$5 per ton in both April and July 2001. In the third fiscal quarter of 2001
published industry prices for kraft paper declined $20 per ton.

The Company's average delivered cost of OCC and DLK both decreased by 4 percent
in the third quarter of fiscal 2001 compared to the second quarter of fiscal
2001, while the average delivered cost of wood chips decreased by 1 percent over
the same period. Fiber markets are difficult to predict; thus there can be no
assurance of the future direction of wood chip, OCC and DLK prices.

During the third quarter of fiscal 2001, natural gas prices continued to be
extremely volatile. Consequently, the Company entered into a series of fixed
price contracts covering the period through March 2002 that required prepayments
of approximately $12 million. Compared to the preceding quarter, the Company's
average natural gas prices paid decreased by 6 percent. The Company expects that
natural gas markets will continue to be volatile.

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<PAGE>   18
Based on current prices for converted products, adjusted for the reduction in
published prices for linerboard; current raw material and energy costs
(including existing contracts and currently quoted futures prices for natural
gas); and assuming maintenance levels of capital spending, the Company believes
that cash provided by operations and borrowings available under its credit
agreements will provide adequate liquidity to meet debt service obligations and
other liquidity requirements over the next 12 to 24 months. Unless there is
significant product price improvement for converted products beyond current
levels however, the Company will need to seek covenant modifications to its bank
credit agreement by the end of December 2001.


                                       16
<PAGE>   19

PENDING ACCOUNTING STANDARDS

In July 2001, the Financial Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards ("SFAS") No. 141, "Business Combinations,",
which establishes accounting and reporting standards for business combinations.
Also, in July 2001 FASB issued SFAS 142, "Goodwill and Other Intangible Assets,"
which establishes accounting and reporting for goodwill and other intangible
assets. The Company is in the process of determining what effect, if any, these
statements will have on its results of operations or financial position.

QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

The Company is subject to market risk associated with changes in interest rates
due to its variable rate debt. The impact on the Company's cash flows and
pre-tax results of operations on an annual basis from a 1 percentage point
change in interest rates is approximately $2.7 million.



                        ------------------------------



FORWARD-LOOKING STATEMENTS IN THIS FILING, INCLUDING THOSE IN THE FOOTNOTES TO
THE FINANCIAL STATEMENTS, ARE MADE PURSUANT TO THE SAFE HARBOR PROVISIONS OF THE
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. WHEN USED IN THIS FILING, THE
WORDS "BELIEVES," "PROJECTED," "EXPECTS," "ANTICIPATES," "ESTIMATES" AND SIMILAR
EXPRESSIONS ARE INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS. SUCH
FORWARD-LOOKING STATEMENTS ARE SUBJECT TO RISKS AND UNCERTAINTIES AND ACTUAL
RESULTS COULD DIFFER MATERIALLY. SUCH RISKS AND UNCERTAINTIES INCLUDE, BUT ARE
NOT LIMITED TO, GENERAL ECONOMIC AND BUSINESS CONDITIONS, COMPETITIVE MARKET
PRICING, INCREASES IN RAW MATERIAL, ENERGY AND OTHER MANUFACTURING COSTS,
FLUCTUATIONS IN DEMAND FOR THE COMPANY'S PRODUCTS, POTENTIAL EQUIPMENT
MALFUNCTIONS AND PENDING LITIGATION. FOR ADDITIONAL INFORMATION SEE THE
COMPANY'S FORM 10-K FILING FOR THE MOST RECENT FISCAL YEAR.

                                       17
<PAGE>   20

                           PART II. OTHER INFORMATION

Item 1.  Legal Proceedings.

         The Company is not a party to any legal proceedings other than
         litigation incidental to normal business activities, except as
         described in "Note 3 of Notes to Condensed Consolidated Financial
         Statements." The Company believes the outcome of such litigation will
         not have a material adverse effect on the Company's financial position,
         results of operations or cash flows.

Item 2.  Changes in Securities.

         Not applicable.

Item 3.  Defaults Upon Senior Securities.

         Not applicable.

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

         Not applicable.

Item 5.  Other Information.

         Not applicable.

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

         Number and Description of Exhibit

         a) No reports on Form 8-K were filed for the quarter ended June 30,
            2001.


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<PAGE>   21


                                   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.


                         GAYLORD CONTAINER CORPORATION

Date:  August 13, 2001   /s/ Marvin A. Pomerantz
                         ----------------------------------------------
                         Marvin A. Pomerantz
                         Chairman and Chief Executive Officer


Date:  August 13, 2001   /s/ Jeffrey B. Park
                         -------------------------
                         Jeffrey B. Park
                         Vice President, Finance
                         (Principal Accounting Officer)

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