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  September  30,  1999
     --------------------------------------------------------

                                       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               (IRS Employer Identification No.)
of  incorporation  or  organization)

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

Registrant's  telephone  number  including  area  code  (414)  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
                                                                  ---    ----

Number of shares outstanding of each class of the registrant's classes of common
stock  as  of  December  8,  1999:  Class  A  Common  Stock  8,706,151  shares.


<PAGE>
Item 1.

                             CRITICARE SYSTEMS, INC.
                           CONSOLIDATED BALANCE SHEETS
                      SEPTEMBER 30, 1999 AND JUNE 30, 1999

                                   (UNAUDITED)

<TABLE>
<CAPTION>


                                                           September 30,     June 30,
                                                               1999            1999
                                                          ---------------  ------------
<S>                                                       <C>              <C>
ASSETS
CURRENT ASSETS:
  Cash and cash equivalents. . . . . . . . . . . . . . .  $    2,426,284   $ 2,511,078
  Accounts receivable. . . . . . . . . . . . . . . . . .       5,828,830     6,358,487
  Other receivables. . . . . . . . . . . . . . . . . . .          55,949        83,106
  Inventory. . . . . . . . . . . . . . . . . . . . . . .       8,425,045     8,510,975
  Prepaid expenses . . . . . . . . . . . . . . . . . . .         243,826       192,290
                                                          ---------------  ------------
    TOTAL CURRENT ASSETS . . . . . . . . . . . . . . . .      16,979,934    17,655,936
                                                          ---------------  ------------

PROPERTY, PLANT AND EQUIPMENT - NET. . . . . . . . . . .       6,275,479     6,274,060
                                                          ---------------  ------------

LICENSE RIGHTS AND PATENTS - NET . . . . . . . . . . . .         107,492       111,991
                                                          ---------------  ------------

TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . .  $   23,362,905   $24,041,987
                                                          ---------------  ------------

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
  Accounts payable . . . . . . . . . . . . . . . . . . .  $    2,205,023   $ 3,078,020
  Accrued liabilities:
    Compensation and commissions . . . . . . . . . . . .       1,024,877     1,446,614
    Product warranties . . . . . . . . . . . . . . . . .         450,000       325,000
    Lawsuit settlement . . . . . . . . . . . . . . . . .         600,000     1,600,000
    Deferred income. . . . . . . . . . . . . . . . . . .               -       380,000
    Other. . . . . . . . . . . . . . . . . . . . . . . .         435,813       412,395
  Current maturities of long-term debt . . . . . . . . .          75,319        73,893
                                                          ---------------  ------------
  TOTAL CURRENT LIABILITIES. . . . . . . . . . . . . . .       4,791,032     7,315,922
                                                          ---------------  ------------

LONG-TERM DEBT, less current maturities. . . . . . . . .       3,345,334     3,364,356
                                                          ---------------  ------------

OTHER LONG-TERM OBLIGATIONS. . . . . . . . . . . . . . .         634,353       650,000
                                                          ---------------  ------------

STOCKHOLDERS' EQUITY
  Preferred stock. . . . . . . . . . . . . . . . . . . .               -             -
  Common stock . . . . . . . . . . . . . . . . . . . . .         348,246       348,246
  Additional paid-in capital . . . . . . . . . . . . . .      17,960,363    17,960,363
  Common stock held in treasury 103,840 shares - at cost        (193,430)     (193,430)
  Retained earnings (accumulated deficit). . . . . . . .      (3,522,993)   (5,403,470)
                                                          ---------------  ------------
  TOTAL STOCKHOLDERS' EQUITY . . . . . . . . . . . . . .      14,592,186    12,711,709
                                                          ---------------  ------------
TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . .  $   23,362,905   $24,041,987
                                                          ---------------  ------------
</TABLE>



See  condensed  notes  to  consolidated  financial  statements.



                                        2
<PAGE>
                             CRITICARE SYSTEMS, INC.
                         CONSOLIDATED INCOME STATEMENTS
                 THREE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998

                                   (UNAUDITED)
<TABLE>
<CAPTION>



                                                         1999         1998
                                                      -----------  -----------

<S>                                                   <C>          <C>
NET SALES. . . . . . . . . . . . . . . . . . . . . .  $6,603,337   $6,724,424

COST OF GOODS SOLD . . . . . . . . . . . . . . . . .   3,614,526    3,465,408
                                                      -----------  -----------

GROSS PROFIT . . . . . . . . . . . . . . . . . . . .   2,988,811    3,259,016
                                                      -----------  -----------

OPERATING EXPENSES:
  Marketing. . . . . . . . . . . . . . . . . . . . .   1,606,379    2,218,182
  Research, development and engineering. . . . . . .     711,456      747,560
  Administrative . . . . . . . . . . . . . . . . . .     514,000      507,469
                                                      -----------  -----------
  TOTAL. . . . . . . . . . . . . . . . . . . . . . .   2,831,835    3,473,211
                                                      -----------  -----------

INCOME (LOSS) FROM OPERATIONS. . . . . . . . . . . .     156,976     (214,195)
                                                      -----------  -----------

OTHER INCOME (EXPENSE):
  Interest expense . . . . . . . . . . . . . . . . .     (65,781)     (78,373)
  Interest income. . . . . . . . . . . . . . . . . .      29,281       22,745
  Gain on sale of Immtech International, Inc. stock.   1,760,000            -
  Equity in the loss of investments. . . . . . . . .           -     (150,000)
                                                      -----------  -----------
  TOTAL. . . . . . . . . . . . . . . . . . . . . . .   1,723,500     (205,628)
                                                      -----------  -----------


INCOME (LOSS) BEFORE INCOME TAXES. . . . . . . . . .   1,880,476     (419,823)

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

NET INCOME (LOSS). . . . . . . . . . . . . . . . . .   1,880,476     (419,823)
                                                      -----------  -----------

NET INCOME (LOSS) PER COMMON SHARE:

  Basic. . . . . . . . . . . . . . . . . . . . . . .  $      .22   $     (.05)
  Diluted. . . . . . . . . . . . . . . . . . . . . .  $      .21   $     (.05)
                                                      -----------  -----------

WEIGHTED AVERAGE NUMBER OF COMMON
  SHARES OUTSTANDING:

  Basic. . . . . . . . . . . . . . . . . . . . . . .   8,706,151    8,715,151
  Diluted. . . . . . . . . . . . . . . . . . . . . .   8,921,806    8,715,151
                                                      -----------  -----------
</TABLE>



See  condensed  notes  to  consolidated  financial  statements.


                                        3
<PAGE>
                            CRITICARE  SYSTEMS, INC,
                      CONSOLIDATED STATEMENTS OF CASH FLOW
                 THREE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998



<TABLE>
<CAPTION>



                                                                  1999         1998
                                                              ------------  -----------
<S>                                                           <C>           <C>
OPERATING ACTIVITIES:
Net income (loss). . . . . . . . . . . . . . . . . . . . . .  $ 1,880,476   $ (419,823)
Adjustments to reconcile net income (loss) to net
  cash (used in) provided by operating activities:
     Depreciation and amortization . . . . . . . . . . . . .      236,283      232,230
     Equity in loss of investments . . . . . . . . . . . . .            -      150,000
     Gain on sale of Immtech International, Inc. stock . . .   (1,760,000)           -
Changes in assets and liabilities:
     Accounts receivable . . . . . . . . . . . . . . . . . .      529,657     (231,951)
     Other receivables . . . . . . . . . . . . . . . . . . .       27,157      117,395
     Inventories . . . . . . . . . . . . . . . . . . . . . .      (68,690)    (768,579)
     Prepaid expenses. . . . . . . . . . . . . . . . . . . .      (51,536)     (80,124)
     Accounts payable. . . . . . . . . . . . . . . . . . . .     (872,997)     697,212
     Accrued liabilities . . . . . . . . . . . . . . . . . .   (1,668,965)      52,812
                                                              ------------  -----------
Net cash (used in) operating activities. . . . . . . . . . .   (1,748,615)    (250,828)
                                                              ------------  -----------

INVESTING ACTIVITIES:
Purchases of property, plant and equipment, net. . . . . . .      (78,583)    (141,945)
Proceeds from the sale of Immtech International, Inc. stock.    1,760,000            -
Advances to Immtech International, Inc.. . . . . . . . . . .            -     (150,000)
                                                              ------------  -----------
Net cash provided by (used in) investing activities. . . . .    1,681,417     (291,945)
                                                              ------------  -----------

FINANCING ACTIVITIES:
Principal payments on long-term debt . . . . . . . . . . . .      (17,596)     (26,364)
                                                              ------------  -----------
Net cash used in financing activities. . . . . . . . . . . .      (17,596)     (26,364)
                                                              ------------  -----------

(DECREASE) INCREASE IN CASH AND
  CASH EQUIVALENTS . . . . . . . . . . . . . . . . . . . . .      (84,794)    (569,137)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD . . . . . . .    2,511,078    2,729,998
                                                              ------------  -----------

CASH AND CASH EQUIVALENTS, END OF PERIOD . . . . . . . . . .  $ 2,426,284   $2,160,861
                                                              ------------  -----------

</TABLE>



See  condensed  notes  to  consolidated  financial  statements.



                                        4
<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  issued  Form  10-K.


2.  Cash  Equivalents

The  Company  considers  all  investments with purchased maturities of less than
three  months  to  be  cash  equivalents.


3.  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  September  30,  1999  and  June  30,  1999,  respectively:
<TABLE>
<CAPTION>



                     September 30,    June 30,
                          1999          1999
                     --------------  ----------
<S>                  <C>             <C>
  Component parts .  $    3,938,706  $3,790,728
  Work in process .       1,296,593   1,261,709
  Finished units. .       3,189,746   3,458,538
                     --------------  ----------
  Total inventories  $    8,425,045  $8,510,975
                     --------------  ----------
</TABLE>




                                        5
<PAGE>
                             CRITICARE SYSTEMS, INC.
              Condensed Notes to Consolidated Financial Statements
                                   (Unaudited)

4.  Property,  Plant  and  Equipment

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



                                        September 30,    June 30,
                                             1999          1999
                                        --------------  -----------
<S>                                     <C>             <C>
  Land and building. . . . . . . . . .  $    4,525,000  $ 4,525,000
  Machinery and equipment. . . . . . .       2,070,673    2,051,442
  Furniture and fixtures . . . . . . .         834,095      819,579
  Demonstration and loaner monitors. .       1,571,513    1,416,893
  Production tooling . . . . . . . . .       2,203,214    2,158,378
                                        --------------  -----------
  Property, plant and equipment - cost      11,204,495   10,971,292
  Less accumulated depreciation. . . .       4,929,016    4,697,232
                                        --------------  -----------
  Property, plant and equipment - net.  $    6,275,479  $ 6,274,060
                                        --------------  -----------
</TABLE>





                                        6
<PAGE>

Item 2.

                             CRITICARE SYSTEMS, INC.
                     Management's Discussion and Analysis of
                  Results of Operations and Financial Condition
                 Three Months Ended September 30, 1999 and 1998

Results  of  Operations
-----------------------

Net  sales  for  the  three months ended September 30, 1999 decreased 2% to $6.6
million  from  $6.7 million for the same period in fiscal 1999.  The decrease in
sales  can  be  attributed  to  a  decrease  in  accessory  sales.

The  gross  profit percentage decreased from 48% for the quarter ended September
30,  1998  to 45% for the quarter ended September 30, 1999.  The decrease in the
gross  profit  percentage  can  be  attributed  to  product  mix  and  pricing
competition.  The  Company  expects  to  experience  a  slight decrease in gross
profit  until  a new family of monitors are introduced later in fiscal 2000.  It
is  expected  that  sales  of these new monitors will be at higher gross margins
than  the  Company  is  currently  experiencing

Operating  expenses  decreased  approximately  $641,000, or 18%, for the quarter
ended  September  30,  1999  when  compared with the same period in fiscal 1999.
This  cost reduction is a direct result of the Company's restructuring plan that
became  effective  July  1,  1999.  Marketing  expenses  decreased approximately
$612,000  when compared to the same period in fiscal 1999.  This decrease is due
to  a  reduction  of  payroll costs, travel and entertainment expenses and trade
show  expenses.  Research,  development and engineering expenses for the quarter
ended  September  30,  1999 decreased approximately $36,000 when compared to the
same  period in fiscal 1999.  This decrease relates to expenses incurred for the
development  of  new  products  which  were released during the third and fourth
quarters  of  fiscal  1999.  Administrative  expenses were relatively consistent
with  those  recorded  in  the  same  period  of  fiscal  1999.

Net non-operating income was $1,723,500 for the three months ended September 30,
1999  compared to  net non-operating expenses of $205,628 for the same period in
fiscal  1999.  The  significant  increase  in non-operating income is due to the
sale  of  a  portion of the stock held in Immtech International, Inc.  This sale
took  place  in a private placement.  The $150,000 equity in loss of investments
recorded in the three months ended September 30, 1998 relates to the purchase of
certain  intangible  assets and an additional 86,207 shares (after giving effect
to  a  reverse  stock split) of Immtech International, Inc. common stock.  Since
this  investment  is  accounted for on the equity method, the purchase price was
expensed.



                                        7
<PAGE>
                             CRITICARE SYSTEMS, INC.
                     Management's Discussion and Analysis of
                  Results of Operations and Financial Condition
                 Three Months Ended September 30, 1999 and 1998

The  net  income  of  $1,880,476  for  the three months ended September 30, 1999
represents  a  significant improvment from the net loss of $419,823 recorded for
the  three months ended September 30, 1998.  This increased profitability is due
to  the  sale  of  the  Immtech  stock  and  the decrease in operating expenses.

Liquidity
---------

At  September  30,  1999,  the  Company  had  a  cash  balance  of approximately
$2,400,000 and no short-term borrowings.  The Company believes its marketing and
research and development activities and other capital and liquidity requirements
will  be  satisfied  by  cash generated from operations and, if needed, periodic
utilization  of the $4,000,000 line of credit currently in place.  At  September
30,  1999,  there  were  no  borrowings  outstanding  under  the line of credit.

The  Company  currently  holds  an  investment  in  Immtech  International, Inc.
("Immtech").  Immtech's  common stock is currently traded on the Nasdaq SmallCap
Market.  As  part  of  Immtech's  initial  public offering, the Company signed a
lock-up  agreement.  All  terms  of  the  lock-up  have  been met other than the
holding  period  which  continues  until  April  2000.

Year  2000  Preparations
------------------------

The  Company  has  developed a plan to address company-wide Year 2000 readiness.
The  Year 2000 issue relates to computer hardware and software and other systems
designed  to  use  two  digits  rather than four digits to define the applicable
year.  As  a  result,  the Year 2000 would be translated as two zeroes.  Because
the  Year  1900  could  also  be translated as two zeroes, systems which use two
digits  could  read  the  date  incorrectly  for  a  number  of  date-sensitive
applications  resulting in potential calculation errors or the shutdown of major
systems.  The  Company  has  updated  its  internal  computer  software,  other
information technology and other operating systems for the purposes of Year 2000
compliance.  The  Company  also  addressed  the  Year  2000  compliance  of  the
Company's  new  and  existing products.  The Company substantially completed its
Year 2000 compliance plan during November 1999 and the costs to become Year 2000
compliant were not material to its financial condition or results of operations.
The  Company  incurred  approximately  $350,000  of  costs  related to Year 2000
readiness.

The  Company's  operations may  also  be  adversely  affected to the extent that
suppliers  and other third parties are not Year 2000 compliant.  The Company has
circulated  surveys  to  its  key  third  party  vendors to assess the Year 2000
compliance  status  of  the  operating systems of such vendors and the potential
impact  on  the  Company  of  non-compliance.


                                        8
<PAGE>
                             CRITICARE SYSTEMS, INC.
                     Management's Discussion and Analysis of
                  Results of Operations and Financial Condition
                 Three Months Ended September 30, 1999 and 1998


However,  a  number  of  risks relating to the year 2000 issue may be out of the
Company's  control,  including  reliance on outside links for essential services
such  as  communications and power.  There can be no assurance that a failure of
systems of third parties on which the Company's systems and operations will rely
to  be  Year  2000  compliant  will  not  have  a material adverse effect on the
Company's  business,  financial  condition  or  operating  results.

Forward  Looking  Statements
----------------------------

A  number of the matters and subject areas discussed in this report 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, Year 2000 compliance,
management's  or  the  Company's  expectations  and  beliefs and similar matters
discussed  in  Management's Discussion and Analysis or elsewhere in this report.
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, government regulation, health care cost containment
programs,  and  competition  in  the  Company's  markets.


                                        9
<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).

            27      Financial  Data  Schedule.

     (b)    Reports  on  Form  8-K:  none  in the first quarter of fiscal 2000.


                                   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       12/09/99           BY  /s/  Joseph  M.  Siekierski
-------------------               ---------------------------
                                    Joseph  M.  Siekierski
                                    Vice  President  -  Finance
                                    (Chief  Accounting  Officer  and
                                    Duly  Authorized  Officer)


                                       10