<PAGE>

================================================================================

                                 UNITED STATES

                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549

                                  FORM 10-K/A
                               (Amendment No. 1)

[X]  Annual report pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934 for the fiscal year ended January 31, 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:  0-26334

                             Inference Corporation
            (Exact name of registrant as specified in its charter)

          Delaware                                           95-3436352
(State or other jurisdiction of                           (I.R.S. Employer
 incorporation or organization)                        Identification Number)


                                100 Rowland Way
                            Novato, California 94945
          (Address of principal executive offices, including zip code)

                                 (415) 893-7200
              (Registrant's Telephone Number, Including Area Code)

       Securities Registered Pursuant to Section 12(b) of the Act:  None

         Securities Registered Pursuant to Section 12(g) of the Act:
                         Common Stock, $.001 par value

     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
requirements for the past 90 days.   YES    X  NO
                                          ----     ----

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of the Form 10-K or any amendment to this
Form 10-K.   ____

     The aggregate market value of the voting stock held by non-affiliates of
the Registrant was approximately $62,012,000 as of March 16, 2000, based upon
the closing sale price on the NASDAQ National Market reported for such date.
Shares of Class A Common Stock held by each officer and director and by each
person who beneficially owns 5% or more of the outstanding Class A Common Stock
have been excluded in that such persons may be deemed to be affiliates.   The
determination of affiliate status is not necessarily a conclusive determination
for other purposes.

     As of March 16, 2000, there were 7,869,737 shares of the Registrant's Class
A Common Stock, $0.01 par value per share outstanding.

================================================================================
<PAGE>

     This Report on Form 10-K/A (Amendment No. 1) is being filed solely for the
purpose of correcting the text of three exhibits filed with the Report on Form
10-K, filed by the Registrant on April 29, 1999.

     This amendment to the Company's Annual Report of Form 10-K, which sets
forth Item 14 of such report, does not otherwise attempt to update the
information included herein beyond the original filing date of the report.

Item 14.  Exhibits, Financial Statement Schedule and Reports on Form 8-K

     (a)  The following documents are filed as part of this Amendment No. 1:


Exhibit No.  Description
-----------  -----------

2.1          Agreement of Merger dated as of July 5, 1996 by and between the
             Registrant and its predecessor (merger agreement effectuating the
             reincorporation of the Registrant into Delaware). (3)

3.1          Certificate of Incorporation of the Registrant. (3)

3.2          Bylaws of the Registrant. (3)

4.2          Master Registration Rights Agreement, dated as of December 5, 1984,
             by and among the Registrant and the investors named therein, as
             amended and supplemented. (1)

4.3          Second Amended and Restated Demand Registration Rights Agreement,
             dated as of April 19, 1993, by and among the Registrant and the
             investors named therein. (1)

4.4          Rights Agreement, dated as of November 25, 1996, between Registrant
             and Harris Trust Company of California (incorporated by reference
             to Exhibit 2 to Registrant's Registration Statement on Form 8-A
             dated November 27, 1996 on file with the Securities and Exchange
             Commission ("Form 8-A")).

4.5          Form of Certificate of Designations of Junior Participating
             Preferred Stock (incorporated by reference to Exhibit 4 to the Form
             8-A).

10.1*        The Amended and Restated Inference Corporation 1993 Stock Option
             Plan and forms of agreement thereunder. (1)

10.2*        The Registrant's Fourth Amended and Restated Incentive Stock Option
             Plan and Nonqualified Stock Option Plan and forms of agreements
             thereunder. (1)

10.3         Not used
<PAGE>

10.4*        The Amended and Restated Inference Corporation 1993 Stock Option
             Plan.(7)

10.5*        The Inference Corporation Amended Employee Stock Purchase Plan. (7)

10.6         The Inference Corporation 1998 Non-Management Stock Option Plan.
             (7)

10.7         Settlement Agreement dated as of August 16, 1998 between the
             Registrant and William D. Griffin. (6)

10.8         Not used

10.9         Not used

10.10        Technology Transfer and License Agreement dated as of May 1, 1995
             between the Registrant and Brightware. (1)

10.11        Not used

10.12*       Executive Employment Agreement effective as of March 4, 1998
             between the Registrant and Charles W. Jepson. (5)

10.13*       Amendment No. 1 to Registrant's Amended and Restated 1993 Stock
             Option Plan dated February 14, 1996 (incorporated by reference to
             Exhibit 10.2 to the July 8, 1996 Form 8-K).

10.14*       Amendment No. 2 to Registrant's Amended and Restated 1993 Stock
             Option Plan dated March 28, 1996 (incorporated by reference to
             Exhibit 10.3 to the July 8, 1996 Form 8-K).

10.15*       Consulting Agreement effective as of April 1, 1998 between the
             Registrant and Peter R. Tierney, as amended by the First Amendment
             To Consulting Agreement dated April 24, 1998. (5)

10.16        Not used

10.17        Knowledge-Pak Reseller License Agreement dated May 1, 1994 between
             the Registrant and ServiceWare, Inc. (1)

10.18-10.20  Not used

10.21        Distributorship and Licensing Agreement dated June 20, 1998 between
             the Registrant and Nichimen Corporation, and Adenda thereto. (1)

10.22        Not used

10.23        Golden Gate Plaza Full Service Lease dated October 14, 1994 between
             Novato Gateway Associates and the Registrant. (1)

                                      -2-
<PAGE>

10.24-10.26  Not used

10.27        Agreement and Plan of Reorganization dated August 13, 1996 among
             Quarterdeck Corporation, Limbex Corporation, the Registrant and the
             other shareholders of Limbex Corporation named therein. (2)

10.28        License Agreement dated January 31, 1994 between the Registrant and
             International Business Machines Corporation, together with
             amendments thereto. (1)

10.29        Software License, Customization and Maintenance Agreement dated
             April 28, 1995 between the Registrant and Bank of America National
             Trust and Savings Association. (1)

10.30        Not used.

10.31        Agreement G 16187 D for Procurement of License and Maintenance of
             Software and Software Development dated February 1, 1991 between
             the Registrant and American Telephone and Telegraph Company,
             together with amendments and related order agreements thereto. (2)

10.32        Agreement for Underleases dated March 1, 1995 between the
             Registrant and Digital Equipment Co. Limited (lease for the
             facility in the United Kingdom). (1)

10.33        Technology License Agreement dated May 9, 1995 between the
             Registrant and Limbex Corporation. (1)

10.34        Software License and Maintenance Agreement dated September 22, 1995
             between the Registrant and ICL Sorbus UK Limited. (2)

10.35        License and Consulting Agreements dated March 30, 1995 between the
             Registrant and Gateway 2000. (2)

10.36-10.37  Not used.

10.38*       Indemnification Agreement dated March 13, 1998 between Registrant
             and Mark A. Wolf. (5)

10.39*       Indemnification Agreement dated March 13, 1998 between the
             Registrant and Philip Padfield. (5)

10.40*       Indemnification Agreement dated November 16, 1998 between the
             Registrant and Nobuo Akika. (6)

10.41*       Indemnification Agreement dated November 16, 1998 between the
             Registrant and Steven Gal. (6)

                                      -3-
<PAGE>

10.42*       Indemnification Agreement dated March 13, 1998 between the
             Registrant and Charles W. Jepson. (5)

10.43*       Indemnification Agreement dated March 13, 1998 between the
             Registrant and Ralph Barletta. (5)

10.44*       Indemnification Agreement dated February 7, 1997 between the
             Registrant and Glen D. Vondrick. (4)

10.45*       Indemnification Agreement dated November 16, 1998 between the
             Registrant and Greg Pappas. (6)

10.46        Not used.

10.47*       Indemnification Agreement dated August 21, 1995 between the
             Registrant and Scott Gibson. (2)

21.1         Subsidiaries of the Registrant. (4)

23.1         Consent of the Independent Auditors. (6)

27.1         Financial Data Schedule. (6)

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

*     Denotes a compensation plan or other agreement under which directors or
      executive officers may participate.

(1)   Incorporated by reference to Exhibit of same number to the Registrant's
      Registration Statement on Form S-1, as amended (file no. 33-92386) on
      file with the Securities and Exchange Commission.

(2)   Incorporated by reference to Exhibit of same number to the Registrant's
      Annual Report on Form 10-K for the fiscal year ended January 31, 1996.

(3)   Incorporated by reference to Exhibit of same number to the Registrant's
      Current Report on Form 8-K dated November 25, 1996.

(4)   Incorporated by reference to Exhibit of same number to the Registrant's
      Annual Report on Form 10-K for the fiscal year ended January 31, 1997.

(5)   Incorporated by reference to Exhibit of same number to the Registrant's
      Annual Report on Form 10-K for the fiscal year ended January 31, 1998.

(6)   Incorporated by reference to Exhibit of same number to the Registrant's
      Annual Report on Form 10-K for the fiscal year ended January 31, 1999.

(7)   Filed herewith.

                                      -4-
<PAGE>

                                  Signatures

     Pursuant to the requirements of Section 13 or 15(d) if the Securities
Exchange Act of 1934, the Registrant had duly caused this Report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                    Inference Corporation

Date:  April 4, 2000                By:      /s/ Charles W. Jepson
                                        ---------------------------------------
                                        Charles W. Jepson
                                        President and Chief Executive Officer


                                        /s/ Philip Ranger
                                        ---------------------------------------
                                        Philip Ranger
                                        Chief Financial Officer


     Pursuant to requirements of the Securities Exchange Act of 1934, this
Report has been signed below by the following persons in the capacities and on
the dates indicated.

<TABLE>
<CAPTION>

<S>                         <C>                          <C>
/s/ Charles W. Jepson       Chief Executive Officer      April 4, 2000
-----------------------     (Principal Executive Officer),
Charles W. Jepson           President and Director



/s/ Philip Ranger           Chief Financial Officer      April 4, 2000
-----------------------
Philip Ranger


          *                 Director                     April 4, 2000
-----------------------
Louis C. Cole III


          *                 Director                     April 4, 2000
-----------------------
C. Scott Gibson


          *                 Director                     April 4, 2000
-----------------------
John J. Katsaros


          *                 Director                     April 4, 2000
-----------------------
Raymond A. Smelek
</TABLE>


*By:/s/ Charles W. Jepson
    ---------------------
      Attorney-in-Fact

                                      -5-