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                       SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON, DC 20549

                                   FORM 10-QSB
                   QUARTERLY REPORT UNDER SECTION 13 OR 15 (D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  FOR THE QUARTERLY PERIOD ENDED: JUNE 30, 2002
                         COMMISSION FILE NUMBER 0-15885

                           NATIONAL DATACOMPUTER, INC.
                 (NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)

           DELAWARE                                         04-2942832
(STATE OR OTHER JURISDICTION OF                  (IRS EMPLOYER IDENTIFICATION #)
 INCORPORATION OR ORGANIZATION)

900 Middlesex Turnpike, Bldg. 5
Billerica, Ma.                                                       01821
(Address of principal executive offices)                          (Zip Code)

        Registrant's telephone number including area code (978) 663-7677

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

Check whether the issuer (1) filed all reports required to be filed by section
13 or 15 (d) of the Securities and Exchange Act of 1934 during the past 12
months (or for such shorter period that the registrant was required to file such
report(s), and (2) has been subject to such filing requirements for the past
ninety (90) days.

                            Yes  [X]     No  [_]

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of August 12, 2002.

COMMON STOCK, $0.08 PAR VALUE                                     12,852,355
    (Title of each class)                                     (number of shares)

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<PAGE>

                           NATIONAL DATACOMPUTER, INC.
                                      INDEX
                          PART I. FINANCIAL INFORMATION

                                                                        Page No.
ITEM 1.  UNAUDITED INTERIM FINANCIAL STATEMENTS:

           Unaudited Balance Sheets as of June 30, 2002
            and December 31, 2001...........................................3

           Unaudited Statements of Operations for the three and six
            months ended June 30, 2002 and 2001.............................4

           Unaudited Statement of Stockholders' Equity for the six
              months ended June 30, 2002....................................5

           Unaudited Statements of Cash Flows for the six months ended
                  June 30, 2002 and  2001...................................6

           Notes to Unaudited Interim Financial Statements..................7


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS
           AND RESULTS OF OPERATIONS........................................9

                           PART II. OTHER INFORMATION

ITEM 1.  Legal Proceedings.................................................14

ITEM 2.  Changes in Securities.............................................14

ITEM 3.  Defaults upon Senior Securities...................................14

ITEM 4.  Submissions of Matters to a Vote of Security Holders..............14

ITEM 5.  Other Information.................................................14

ITEM 6.  Exhibits and Reports on Form 8-K..................................14

SIGNATURES.................................................................15

                                        2
<PAGE>

                           NATIONAL DATACOMPUTER, INC.
                           BALANCE SHEETS (Unaudited)
--------------------------------------------------------------------------------
<TABLE><CAPTION>
                                                                         June 30,     December 31,
                                                                           2002           2001
                                                                       ------------   ------------
Assets
Current Assets:
<S>                                                                   <C>            <C>
       Cash and cash equivalents                                       $    216,565   $    568,644
       Accounts receivable, net                                             298,874        330,953
       Inventories                                                          939,610      1,142,959
       Other current assets                                                  50,992         14,930
                                                                       ------------   ------------
          Total current assets                                            1,506,041      2,057,486
Fixed assets, net                                                           251,506        277,294
Capitalized software development costs, net                                 266,873        242,553
                                                                       ------------   ------------
          Total Assets                                                 $  2,024,420   $  2,577,333
                                                                       ============   ============

Liabilities and stockholders' equity
Current Liabilities:
       Current obligations under capital lease                         $     17,592   $     17,595
       Notes Payable, current portion                                        72,000         72,000
       Accounts payable and other                                           403,036        387,885
       Accrued payroll and related taxes                                    117,941         94,270
       Other accrued expenses                                               144,609        178,742
       Deferred revenues                                                    693,992        775,222
                                                                       ------------   ------------
          Total current liabilities                                       1,449,170      1,525,714
Obligations under capital lease, net of current portion                      37,223         44,313
Notes Payable, net of current portion                                             -         36,000
                                                                       ------------   ------------
          Total Liabilities                                               1,486,393      1,606,027
                                                                       ------------   ------------

Commitments and Contingencies

Stockholders' equity:
  Preferred stock, Series A convertible, $0.001 par value;
    20 shares authorized; no shares issued and outstanding                        -              -

  Preferred stock, Series B convertible $0.001 par value;
    4,200 shares authorized; 2,400 issued and outstanding,
      respectively (liquidating preference of $2,400,000 )                2,105,832      2,105,832

  Preferred stock, Series C convertible $0.001 par value;
   900 shares authorized, issued and outstanding
   (liquidating preference of $900,000)                                     834,370        834,370

  Preferred stock, Series D convertible $0.001 par value;
    350 shares authorized, issued and outstanding
    (liquidating preference of $350,000)                                    324,639        324,639

  Preferred stock, Series E convertible $0.001 par value;
    500 shares authorized, issued and outstanding
    (liquidating preference of $500,000)                                    273,880        273,880

  Preferred stock, Series F convertible $0.001 par value;
    175 shares authorized, no shares issued and outstanding                       -              -

  Common stock, $0.08 par value; 30,000,000 shares authorized;
     12,852,355 and 11,115,397 shares issued and outstanding at
     June 30, 2002 and December 31, 2001                                  1,028,187        889,230

  Capital in excess of par value                                         13,008,368     13,013,825
  Accumulated deficit                                                   (16,685,980)   (16,119,201)
  Notes receivable employees                                               (351,269)      (351,269)
                                                                       ------------   ------------
     Total stockholders' equity                                             538,027        971,306
                                                                       ------------   ------------
     Total liabilities and stockholders' equity                        $  2,024,420   $  2,577,333
                                                                       ============   ============
</TABLE>


              The accompanying notes are an integral part of these
                         unaudited financial statements.

                                        3
<PAGE>

                          NATIONAL DATACOMPUTER, INC.
                      STATEMENTS OF OPERATIONS (Unaudited)
--------------------------------------------------------------------------------
<TABLE><CAPTION>
                                            Second Fiscal Quarter              Six Months
                                                    Ended                         Ended
                                         ---------------------------------------------------------
                                           June 30,       June 30,       June 30,       June 30,
                                             2002           2001           2002           2001
                                         ------------   ------------   ------------   ------------
Revenues
<S>                                     <C>            <C>            <C>            <C>
     Product revenue                     $    603,278   $    468,383   $  1,372,223   $    720,557
     Service and other revenue                431,140        374,264        846,806        776,427
                                         ------------   ------------   ------------   ------------
                                            1,034,418        842,647      2,219,029      1,496,984

Cost of sales and services                    578,354        633,899      1,269,985        996,751
                                         ------------   ------------   ------------   ------------
                                              456,064        208,748        949,044        500,233
                                         ------------   ------------   ------------   ------------

Operating expenses:
     Research and development                 200,868        139,702        430,787        304,591
     Selling and marketing                    182,750        187,528        331,457        378,269
     General and administrative               335,395        438,685        615,271        851,284
                                         ------------   ------------   ------------   ------------
                                              719,013        765,915      1,377,515      1,534,144
                                         ------------   ------------   ------------   ------------

Loss from operations                         (262,949)      (557,167)      (428,471)    (1,033,911)

Other income (expense):
     Interest income                                -              -              -          3,948
     Interest expense                          (2,278)        (3,340)        (4,808)        (5,990)
                                         ------------   ------------   ------------   ------------
Net loss                                 $   (265,227)  $  (560,507)   $   (433,279)  $ (1,035,953)
                                         ============   ============   ============   ============

Calculation of net loss per common share
  and dilutive share equivalents:

Net loss                                 $   (265,227)  $   (560,507)  $   (433,279)  $ (1,035,953)
Interest on preferred stock                   (66,750)       (66,750)      (133,500)      (136,125)
                                         ------------   ------------   ------------   ------------
Net loss attributable to common
     shareholders                        $   (331,977)  $   (627,257)  $   (566,779)  $ (1,172,078)
                                         ============   ============   ============   ============

Basic and diluted net loss per share     $      (0.03)  $      (0.09)  $      (0.05)  $      (0.15)
                                         ============   ============   ============   ============

Weighted average shares                    11,363,534      7,079,063     12,052,877      7,853,567
                                         ============   ============   ============   ============
</TABLE>

              The accompanying notes are an integral part of these
                         unaudited financial statements

                                        4
<PAGE>

                           NATIONAL DATACOMPUTER, INC.
                  STATEMENT OF STOCKHOLDERS' EQUITY (Unaudited)
--------------------------------------------------------------------------------
<TABLE><CAPTION>
                                       Preferred                Preferred                Preferred                Preferred
                                     Stock Series B           Stock Series C           Stock Series D           Stock Series E
                                 ----------------------   ----------------------   ----------------------   ----------------------
                                            Net issuance             Net issuance             Net issuance             Net issuance
                                   Shares      price        Shares      price        Shares      price        Shares      price
                                 ----------  ----------   ----------  ----------   ----------  ----------   ----------  ----------

<S>                             <C>         <C>          <C>         <C>          <C>         <C>          <C>         <C>
Balance at December 31, 2001          2,400  $2,105,832          900  $  834,370          350  $  324,639          500  $  273,880

Net loss

Interest on preferred stock
  to be satisfied through the
  issuance of common stock

                                 ----------  ----------   ----------  ----------   ----------  ----------   ----------  ----------
Balance at March 31, 2002             2,400  $2,105,832          900  $  834,370          350  $  324,639          500  $  273,880
                                 ==========  ==========   ==========  ==========   ==========  ==========   ==========  ==========

Net loss

Interest on preferred stock
  to be satisfied through the
  issuance of common stock

Issuance of common stock
   in satisfaction of accrued
   interest

                                 ----------  ----------   ----------  ----------   ----------  ----------   ----------  ----------
Balance at June 30, 2002              2,400  $2,105,832          900  $  834,370          350  $  324,639          500  $  273,880
                                 ==========  ==========   ==========  ==========   ==========  ==========   ==========  ==========
</TABLE>

<PAGE>

                           NATIONAL DATACOMPUTER, INC.
            STATEMENT OF STOCKHOLDERS' EQUITY (Unaudited)(continued)
--------------------------------------------------------------------------------
<TABLE><CAPTION>
                                               Common Stock
                                 ----------------------------------------
                                                              Capital in         Notes                      Total
                                                   Par          excess        receivable    Accumulated  stockholders'
                                    Shares        value      of par value      empolyees      deficit       equity
                                 ------------  ------------  ------------    ------------  ------------  ------------
<S>                                <C>         <C>           <C>             <C>           <C>           <C>
Balance at December 31, 2001       11,115,397  $    889,230  $ 13,013,825    $   (351,269) $(16,119,201) $    971,306

Net loss                                                                                       (168,052)     (168,052)

Interest on preferred stock                                                                                         0
  to be satisfied through the
  issuance of common stock                                         66,750                       (66,750)            0
                                 ------------  ------------  ------------    ------------  ------------  ------------
Balance at March 31, 2002          11,115,397  $    889,230  $ 13,080,575    $   (351,269) $(16,354,003) $    803,254
                                 ============  ============  ============    ============  ============  ============

Net loss                                                                                       (265,227)     (265,227)

Interest on preferred stock                                                                                         0
  to be satisfied through the
  issuance of common stock                                         66,750                       (66,750)            0

Issuance of common stock
   in satisfaction of accrued
   interest                         1,736,958       138,957      (138,957)
                                 ------------  ------------  ------------    ------------  ------------  ------------
Balance at June 30, 2002           12,852,355  $  1,028,187  $ 13,008,368    $   (351,269) $(16,685,980) $    538,027
                                 ============  ============  ============    ============  ============  ============
</TABLE>

              The accompanying notes are an integral part of these
                         unaudited financial statements

                                        5
<PAGE>

                           NATIONAL DATACOMPUTER, INC.
                      STATEMENTS OF CASH FLOWS (Unaudited)
--------------------------------------------------------------------------------
<TABLE><CAPTION>
                                                              Six months ended
                                                        ---------------------------
                                                          June 30,       June 30,
                                                            2002           2001
                                                        ------------   ------------
Cash flows from operating activities:
<S>                                                    <C>            <C>
  Net loss                                              $   (433,279)  $ (1,035,953)
  Adjustments to reconcile net loss to net
    cash used for operating activities:
    Depreciation                                              52,339         43,897
    Amortization                                              32,496              -
    Changes in assets and liabilities:
      Decrease in accounts receivable                         32,079          7,428
      Decrease (increase) in inventories                     203,349        (48,942)
      (Increase) decrease in other current assets            (36,062)           705
      Increase in accounts payable                            15,151        313,861
      (Decrease) increase in accrued expenses                (10,462)        54,052
      (Decrease) increase in deferred revenues               (81,230)       157,209
                                                        ------------   ------------
  Net cash used for operating activities                    (225,619)      (507,743)
                                                        ------------   ------------

Cash flows from investing activities:
  Purchases of fixed assets                                  (26,551)      (127,211)
  Additions to capitalized software development costs        (56,816)       (82,850)
                                                        ------------   ------------
  Net cash used for investing activities                     (83,367)      (210,061)
                                                        ------------   ------------

Cash flows from financing activities:
  Principal payment on note payable                          (36,000)             -
  Principal payment on obligations
    under capital lease                                       (7,093)        (7,628)
                                                        ------------   ------------
  Net cash used for financing activities                     (43,093)        (7,628)
                                                        ------------   ------------

Net decrease in cash and cash equivalents                   (352,079)      (725,432)
Cash and cash equivalents at beginning of year               568,644      1,213,443
                                                        ------------   ------------

Cash and cash equivalents at end of period              $    216,565   $    488,011
                                                        ============   ============

Supplemental Cash Flow Information:
  Noncash investing and financing activities:
    Common stock issued in satisfaction of
      interest on preferred stock                       $    133,500   $    136,125
    Issuance of common stock upon conversion of
      preferred stock                                              -        175,000
</TABLE>

              The accompanying notes are an integral part of these
                        unaudited financial statements.

                                        6
<PAGE>
                           NATIONAL DATACOMPUTER, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.   ORGANIZATION

     National Datacomputer, Inc. (the "Company") designs, develops,
     manufactures, markets and services a line of hand-held battery powered
     microprocessor-based data collection products and computers and
     associated peripherals for use in mobile operations. The Company's
     products and services include data communications networks,
     application-specific software, hand-held computers and related
     peripherals, associated training and support services.

     LIQUIDITY AND CAPITAL RESOURCES

     The accompanying unaudited financial statements have been prepared
     assuming that the Company will continue as a going concern, which
     contemplates continuity of operations, realization of assets and the
     satisfaction of liabilities and commitments in the normal course of
     business. The Company has incurred an accumulated deficit of
     approximately $16.7 million through June 30, 2002, recorded a net loss of
     $433,279 during the first six months of 2002 and used $225,619 of cash in
     operations during the first six months of fiscal 2002. As of June 30,
     2002, the Company had $216,565 in cash and working capital of $56,871. In
     the event that the Company's operations are not profitable or do not
     generate sufficient cash to fund the business, or if the Company fails to
     obtain additional financing, management will have to substantially reduce
     their level of operations. These circumstances raise substantial doubt
     about the Company's ability to continue as a going concern. These
     financial statements do not include any adjustments that might result
     from the outcome of this uncertainty.

     In order to improve its cash position, the Company is taking a number of
     steps to reduce operating expenses, while simultaneously pursuing sales
     opportunities, which it believes, should result in adequate revenues in the
     third and fourth quarters of fiscal 2002 to meet cash flow requirements.
     The Company maintains adequate levels of inventory and has not experienced
     any interruption of supplies or services from vendors. Future reductions in
     revenue levels could require the Company to implement further cost savings.


2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     BASIS OF PRESENTATION

     The accompanying unaudited financial statements, which are for interim
     periods, do not include all disclosures provided in the annual financial
     statements. These unaudited financial statements should be read in
     conjunction with the financial statements and the footnotes thereto
     contained in the Annual Report on Form 10-KSB for the year ended December
     31, 2001 of National Datacomputer, Inc., as filed with the Securities and
     Exchange Commission.

     The balance sheet as of December 31, 2001, is derived from the audited
     financial statements presented in the Company's Annual Report on Form
     10-KSB for the year then ended.

                                        7
<PAGE>

     INTERIM PERIODS

     In the opinion of the Company, the accompanying unaudited interim
     financial statements have been prepared in accordance with accounting
     principles generally accepted in the United States of America for interim
     financial information, with instructions to Form 10-QSB, and regulation
     S-X, and contain all adjustments (which are of a normal and recurring
     nature) necessary for a fair presentation of the financial statements.
     The results of operations for the six months ended June 30, 2002 are not
     necessarily indicative of the results to be expected for the full year.

     LOSS PER SHARE

     Net loss per share is computed under SFAS No. 128, "Earnings Per Share."
     Basic net loss per share is computed by dividing net loss, after
     deducting certain amounts associated with the Company's preferred stock,
     by the weighted average number of common shares outstanding for the
     period. Diluted net loss per share is computed using the weighted average
     number of common shares outstanding and gives effect to all dilutive
     common share equivalents outstanding during the period.

     Interest payable to preferred stockholders, the fair value of inducements
     to convert preferred stock into common stock, and any discounts implicit
     in the conversion terms upon issuance of preferred stock are subtracted
     from the net loss to determine the amount of net loss attributable to
     common stockholders

3.   INVENTORIES

     Inventories consist of the following:      JUNE 30,       DECEMBER 31,
                                                  2002            2001
                                              ------------    ------------
     Raw material                             $    667,370    $    581,949
     Work-in-process                               212,290         371,355
     Finished goods                                 59,950         189,655
                                              ------------    ------------
         Total                                $    939,610    $  1,142,959
                                              ============    ============

     Inventories are stated at the lower of cost (first-in, first-out) or
     market.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS.

The following discussion and analysis should be read in conjunction with the
unaudited financial statements and notes thereto appearing elsewhere herein and
the Company's annual report on Form 10-KSB filed with the Securities and
Exchange Commission for the fiscal year ended December 31, 2001.

                                        8
<PAGE>

This report contains forward-looking statements within the meaning of Section
27A of the Securities Act and Section 21E of the Securities Exchange Act that
involve risks and uncertainties. The Company generally uses words such as
"believe," "may," "could," "will," "intend," "expect," "anticipate," "plan," and
similar expressions to identify forward-looking statements. You should not place
undue reliance on these forward-looking statements. The Company's actual results
could differ materially from those anticipated in the forward-looking statements
for many reasons, including the risks described below and elsewhere in this
report.

Although the Company believes the expectations reflected in the forward-looking
statements are reasonable, they relate only to events as of the date on which
the statements are made, and the Company cannot assure you that its future
results, levels of activity, performance or achievements will meet these
expectations. Moreover, neither the Company nor any other person assumes
responsibility for the accuracy and completeness of the forward-looking
statements. The Company does not intend to update any of the forward-looking
statements after the date of this report to conform these statements to actual
results or to changes in the Company's expectations, except as required by law.

OVERVIEW

The Company's critical accounting policies and areas of significant accounting
judgments and estimates are described in the Management's Discussion and
Analysis of Financial Conditions and Result of Operations included in the
Company's most recent Annual Report on Form 10-KSB for the year ended December
31, 2001, which are supplemented by the revenue recognition discussion below,
should be read in conjunction with the discussion below.

The Company recognizes revenue in accordance with the American Institute of
Certified Public Accountants Statement of Position ( SOP ) 97-2, Software
Revenue Recognition, as modified by SOP 98-9, Modification of SOP 97-2, Software
Revenue Recognition, With Respect to Certain Transactions.

Revenue related to the sales of the Company's products and systems is generally
recognized when products are shipped or services are rendered, the title and
risk of loss has passed to the customer, the sales price is fixed or
determinable, and collectibility is reasonably assured. Service and maintenance
sales are recognized over the contract term.

Accordingly, if products, services or maintenance are bundled in a single
contract, revenue will be recognized once all elements of the contract are
completed unless the following criteria are met: (1) the product has been
delivered; (2) the undelivered services or maintenance are not essential to the
delivered products; (3) the fee for the product is not subject to forfeiture,
refund or concession based on performance of the services or maintenance; (4)
the fair value of services and maintenance are determined based on the price
charged by the Company, or the price charged by competitors when similar
services or maintenance are sold separately; and (5) the revenue related to any
element of the contract is not subject to customer acceptance; in which case the
revenue for each element will be recognized independently.

                                        9
<PAGE>

RESULTS OF OPERATIONS

THREE MONTHS ENDED JUNE 30, 2002 COMPARED TO THREE MONTHS ENDED JUNE 30, 2001.

Revenues in the second quarter of fiscal year 2002 were $1,034,418 compared to
$842,647 in the second quarter of fiscal 2001, an increase of 23%. Product
revenues of $603,278 in the second quarter of fiscal 2002 increased 29% from the
comparable prior year period. The increase in product revenues is due to
increased shipments of our newly introduced inventory services product the DC5,
and the DC4, our existing route service product.

Service revenue of $431,140 for the second quarter of fiscal year 2002 increased
15% from the comparable prior year period primarily due to additional customer
service revenue and an increase in maintenance contract revenue.

Cost of sales and services, as a percentage of net revenues, was 56% in the
second quarter of fiscal 2002 compared to 75% in the second quarter of fiscal
2001. The decrease in cost was due to a reduction, during the second quarter of
fiscal 2001, to our estimates of net realizable value of certain older,
discontinued products. These older products have been moving at a slower pace
due to our transition to the faster and more efficient new generation of
wireless Microsoft(TM) Windows(R) CE based hand-helds computer. In the second
quarter of fiscal 2002, we have incurred $20,067 in amortization expenses of
internally developed product software. This amortization expense was not
existent in the second quarter of fiscal 2001 since we did not start amortizing
our capitalized internally developed product software until the last quarter of
fiscal year 2001.

Research and development expenses increased to 19% of net revenues in the second
quarter of fiscal 2002 from 17% in the second quarter of fiscal year 2001.
Actual research and development spending increased by 44% in absolute dollars to
$200,868 in the second quarter of fiscal 2002, from $139,702 for the same period
in 2001. The higher expenses were attributable to a decrease in the amount of
capitalized costs incurred for internally developed product software, namely
Enhanced Financial Audit, coupled with our continued investment in expanding our
current products' applications, namely Wireless Inventory Networking and Route
Accounting.

Selling and marketing expenses decreased to 18% of net revenues in the second
quarter of fiscal 2002 from 23% in the second quarter of fiscal year 2001.
Actual selling and marketing spending decreased by 3% in absolute dollars to
$182,750 in the second quarter of fiscal 2002, from $187,528 for the same period
in 2001. The

                                       10
<PAGE>

decrease was primarily attributable to our focus in adjusting the required sales
and marketing effort to match our level of sales.

General and administrative expenses decreased to 32% of net revenues in the
second quarter of fiscal 2002 from 52% in the second quarter of fiscal year
2001. Actual general and administrative spending decreased by 24% in absolute
dollars to $335,395 in the second quarter of fiscal 2002, from $438,685 for the
same period in 2001. The decrease was attributable to lower legal fees in
conjunction with our complaint filed against Infos International, Inc. and Infos
Group, Inc., offset by increased reserves for doubtful accounts.

SIX MONTHS ENDED JUNE 30, 2002 COMPARED TO SIX MONTHS ENDED JUNE 30, 2001

Revenues in the first six months of fiscal year 2002 were $2,219,029 compared to
$1,496,984 in the first six months of fiscal 2001, an increase of 48%.

Product revenues of $1,372,223 in the first six months of fiscal 2002 increased
90% from the comparable prior year period. The increase in product revenues is
due to increased shipments of our newly introduced inventory services product
the DC5, and the DC4, our existing route service product.

Service revenue of $846,806 for the first six months of fiscal year 2002
increased 9% from the comparable prior year period primarily due to additional
customer service revenue and an increase in maintenance contract revenue

Cost of sales and services, as a percentage of net revenues, was 57% in the
first six months of fiscal 2002 compared to 67% in the first six months of
fiscal 2001. The decrease in cost was due to a reduction, during the second
quarter of fiscal 2001, to our estimates of net realizable value of certain
older, discontinued products. These older products have been moving at a slower
pace due to our transition to the faster and more efficient new generation of
wireless Microsoft(TM) Windows(R) CE based hand-helds computer. In the first six
months of fiscal 2002, we have incurred $32,496 in amortization expenses of
internally developed product software. This amortization expense was not
existent in the first six months of fiscal 2001 since we did not start
amortizing our capitalized internally developed product software until the last
quarter of fiscal year 2001.

Research and development expenses decreased to 19% of net revenues in the first
six months of fiscal 2002 from 20% in the first six months of fiscal year 2001.
Actual research and development spending increased by 41% in absolute dollars to
$430,787 in the first six months of fiscal 2002, from $304,591 for the same
period in 2001. The higher expenses were attributable to a decrease in the
amount of capitalized costs incurred for internally developed product software,
namely Enhanced Financial Audit, coupled with our continued investment in
expanding our current products' applications, namely Wireless Inventory
Networking and Route Accounting.

                                       11
<PAGE>

Selling and marketing expenses decreased to 15% of net revenues in the first six
months of fiscal 2002 from 25% in the first six months of fiscal year 2001.
Actual selling and marketing spending decreased by 12% in absolute dollars to
$331,457 in the first six months of fiscal 2002, from $378,269 for the same
period in 2001. The decrease was primarily attributable to our focus in
adjusting the required sales and marketing effort to match our level of sales.

General and administrative expenses decreased to 28% of net revenues in the
first six months of fiscal 2002 from 57% in the first six months of fiscal year
2001. Actual general and administrative spending decreased by 28% in absolute
dollars to $615,271 in the first six months of fiscal 2002, from $851,284 for
the same period in 2001. The decrease was attributable to lower legal fees in
conjunction with our complaint filed against Infos International, Inc. and Infos
Group, Inc., combined with our continued cost containment efforts.

LIQUIDITY AND CAPITAL RESOURCES

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern, which contemplates continuity of
operations, realization of assets and the satisfaction of liabilities and
commitments in the normal course of business. The Company has incurred an
accumulated deficit of approximately $16.7 million through June 30, 2002,
recorded a net loss of $433,279 during the first six months of 2002 and used
$225,619 of cash in operations during the first six months of fiscal 2002. As of
June 30, 2002, the Company had $216,565 in cash and working capital of $56,871.
In the event that the Company's operations are not profitable or do not generate
sufficient cash to fund the business, or if the Company fails to obtain
additional financing, if required, management will have to substantially reduce
their level of operations. These circumstances raise substantial doubt about the
Company's ability to continue as a going concern. These financial statements do
not include any adjustments that might result from the outcome of this
uncertainty.

In order to improve its cash position, the Company is taking a number of steps
to reduce operating expenses, while simultaneously pursuing sales opportunities,
which it believes, should result in adequate revenues in the third and fourth
quarters of fiscal 2002 to meet cash flow requirements. The Company maintains
adequate levels of inventory and has not experienced any interruption of
supplies or services from vendors. Future reductions in revenue levels could
require the Company to implement further cost savings.

Cash used in operating activities was $225,619. This was a result of the loss of
$433,279 we experienced in the first six months of fiscal 2002, partially offset
by a decrease of inventory during the period.

Cash used for investing activities was $83,367 due to the purchase of fixed
assets and the capitalization of software development in the amount of $56,816.

Cash used for financing activities was $43,093 primarily due to the payment of
$36,000 towards our outstanding note payable.

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<PAGE>
                           PART II - OTHER INFORMATION


ITEM 1. LEGAL PROCEEDINGS

As reported in the Company's Form 10-QSB for the fiscal quarter ended March 31,
2000, we filed a complaint in March 2000 in Middlesex Superior Court for the
Commonwealth of Massachusetts against Infos International, Inc. and Infos Group,
Inc. (the "Defendants"). The parties have agreed to participate in a non-binding
mediation.


ITEM 2. CHANGES IN SECURITIES

On June 17, 2002, we issued an aggregate of 1,736,956 shares of our common stock
to Capital Bank Grawe Gruppe AG ("Capital Bank" and formerly known as RBB Bank)
in satisfaction of an aggregate interest payment of $133,500, which interest was
due under the terms of our Series B, C, and D Convertible Preferred Stock that
are currently issued, outstanding, and held by Capital Bank. No underwriters
were involved in the transaction, and there were no underwriting discounts or
commissions. We relied upon Section 4(2) of the Securities Act of 1933, as
amended, because the transaction did not involve any public offering by the
Company.


ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not Applicable.


ITEM 4. SUBMISSIONS 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

(a)     Exhibits

        (11)    Statement Re: Computation of Per Share Loss.

        (99.1)  Certification of Executive Officers.

(b)     Reports on Form 8-K

        No reports on form 8-K were filed during the period covered by this
        report.

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<PAGE>

                                   SIGNATURES

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


                                       NATIONAL DATACOMPUTER, INC.


August 14, 2002                        /s/ John P. Ward
                                       ------------------------------------
                                       John P. Ward
                                       Chairman of the Board, President and
                                        Chief Executive Officer (principal
                                        executive officer)




August 14, 2002                        /s/ Gerald S. Eilberg
                                       ------------------------------------
                                       Gerald S. Eilberg
                                       Chief Financial Officer (principal
                                        financial and accounting officer)





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