<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 March 31, 2000

                                       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 March 31, 2000

                          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 May 8, 2000, the registrant had outstanding 55,213,010 shares of
its $0.0001 par value Class A Common Stock (including 1,022,835 shares held in
trust for the benefit of the warrant holders) and 1,022,835 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 - 10

Item 2.   Management's Discussion and Analysis of
          Financial Condition and Results of Operations           11 - 18

PART II.  OTHER INFORMATION

Item 1.   Legal Proceedings                                         19

Item 2.   Changes in Securities                                     19

Item 3.   Defaults Upon Senior Securities                           19

Item 4.   Submission of Matters to a Vote of Security
          Holders                                                   19

Item 5.   Other Information                                         19

Item 6.   Exhibits and Reports on Form 8-K                          20


SIGNATURES                                                          21




<PAGE>   3

GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS
MARCH 31, 2000 AND SEPTEMBER 30, 1999

<TABLE>
<CAPTION>
                                                           MARCH 31,   SEPTEMBER 30,
                                                             2000         1999
                                                          ----------   -------------
ASSETS                                                            (In millions)
------
<S>                                                       <C>          <C>
CURRENT ASSETS:
    Cash and equivalents                                  $     11.4   $     10.4
    Trade receivables (less allowances of $7.8
      million and $6.7 million, respectively)                  156.9        149.8
    Inventories (Note 2)                                       116.8         67.1
    Other current assets                                        21.2         12.8
                                                          ----------   ----------
        Total current assets                                   306.3        240.1
                                                          ----------   ----------

PROPERTY, PLANT AND EQUIPMENT:
    Property, plant and equipment, at cost                   1,184.2      1,119.3
    Less accumulated depreciation                             (596.7)      (560.4)
                                                          ----------   ----------
        Property - net                                         587.5        558.9
                                                          ----------   ----------

DEFERRED INCOME TAXES                                          151.9        150.3

OTHER ASSETS                                                    54.7         68.7
                                                          ----------   ----------
        TOTAL                                             $  1,100.4   $  1,018.0
                                                          ==========   ==========


LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
    Current maturities of long-term debt                  $     11.7   $     10.9
    Trade payables                                              70.1         56.2
    Accrued interest payable                                    17.4         16.2
    Accrued and other liabilities                               79.8         61.1
                                                          ----------   ----------
        Total current liabilities                              179.0        144.4
                                                          ----------   ----------

LONG-TERM DEBT                                                 965.2        924.8

OTHER LONG-TERM LIABILITIES                                     48.9         39.6

COMMITMENTS AND CONTINGENCIES (Note 3)                          --           --

STOCKHOLDERS' EQUITY (DEFICIT):
    Class A common stock - par value, $0.0001
      per share; authorized 125,000,000 shares;
      issued 55,204,676 shares and 54,991,409
      shares, respectively, and outstanding
      53,761,018 shares and 53,523,443 shares,
      respectively                                              --           --
    Capital in excess of par value                             178.6        178.2
    Accumulated deficit                                       (259.5)      (257.0)
    Common stock in treasury - at cost;
      1,443,658 shares and 1,467,966 shares,
      respectively                                             (10.7)       (10.9)
    Accumulated other comprehensive income (loss):
      Minimum pension liability                                 (1.1)        (1.1)
                                                          ----------   ----------
    Total stockholders' equity (deficit)                       (92.7)       (90.8)
                                                          ----------   ----------
        TOTAL                                             $  1,100.4   $  1,018.0
                                                          ==========   ==========
</TABLE>

See notes to condensed consolidated financial statements.

<PAGE>   4
GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED
MARCH 31, 2000 AND 1999 (In millions, except per share data)
--------------------------------------------------------------------------------

                                                  THREE MONTHS ENDED MARCH 31,
                                                  ----------------------------
                                                      2000         1999
                                                      ----         ----

NET SALES                                           $   291.2    $   201.0
COST OF GOODS SOLD                                      245.1        185.7
                                                    ---------    ---------
GROSS MARGIN                                             46.1         15.3
SELLING AND ADMINISTRATIVE COSTS                        (28.9)       (24.8)
                                                    ---------    ---------
OPERATING INCOME (LOSS)                                  17.2         (9.5)
INTEREST EXPENSE - Net                                  (23.0)       (21.5)
OTHER INCOME (EXPENSE) - Net                              0.4         (0.2)
                                                    ---------    ---------
LOSS BEFORE TAXES                                        (5.4)       (31.2)
INCOME TAX BENEFIT                                        2.0         11.9
                                                    ---------    ---------
NET LOSS                                                 (3.4)   $   (19.3)
                                                                 =========

ACCUMULATED DEFICIT:
 Beginning of period                                    256.1
                                                    ---------
 End of period                                      $   259.5
                                                    =========

INCOME (LOSS) PER COMMON SHARE:
 Basic                                              $   (0.06)   $   (0.36)
                                                    =========    =========
 Diluted (A)                                              N/A          N/A
                                                    =========    =========

WEIGHTED AVERAGE COMMON AND COMMON
  SHARE EQUIVALENTS

 BASIC:
  WEIGHTED AVERAGE COMMON SHARES
     OUTSTANDING                                         53.8         53.3


 DILUTED:
  EFFECT OF DILUTIVE SECURITIES:
     Employee and director stock
     options                                              0.3          0.5
                                                    ---------    ---------
Weighted average common and common
  share equivalents                                      54.1         53.8
                                                    =========    =========

(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 SIX MONTHS ENDED
MARCH 31, 2000 AND 1999 (In millions, except per share data)
--------------------------------------------------------------------------------

                                                  SIX MONTHS ENDED MARCH 31,
                                                  --------------------------
                                                     2000           1999
                                                     ----           ----

NET SALES                                         $   570.8      $   399.8
COST OF GOODS SOLD                                    475.3          364.1
                                                  ---------      ---------
GROSS MARGIN                                           95.5           35.7
SELLING AND ADMINISTRATIVE COSTS                      (55.4)         (48.3)
                                                  ---------      ---------
OPERATING INCOME (LOSS)                                40.1          (12.6)
INTEREST EXPENSE - Net                                (45.1)         (42.1)
OTHER INCOME (EXPENSE) - Net                            1.0           (1.0)
                                                  ---------      ---------
LOSS BEFORE TAXES                                      (4.0)         (55.7)
INCOME TAX BENEFIT                                      1.5           21.3
                                                  ---------      ---------
NET LOSS                                               (2.5)     $   (34.4)
                                                                 =========

ACCUMULATED DEFICIT:
 Beginning of period                                  257.0
                                                  ---------
 End of period                                    $   259.5
                                                  =========

LOSS PER COMMON SHARE:
 Basic                                            $   (0.05)     $   (0.64)
                                                  =========      =========
 Diluted (A)                                         N/A            N/A
                                                  =========      =========

WEIGHTED AVERAGE COMMON AND COMMON
  SHARE EQUIVALENTS

 BASIC:
  WEIGHTED AVERAGE COMMON SHARES
     OUTSTANDING
                                                       53.7           53.3

 DILUTED:
  EFFECT OF DILUTIVE SECURITIES:
     Employee and director stock
     options                                            0.4            0.4
                                                  ---------      ---------

Weighted average common and common share
  equivalents                                          54.1           53.7
                                                  =========      =========


(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 SIX MONTHS ENDED
MARCH 31, 2000 AND 1999
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                      SIX MONTHS ENDED MARCH 31,
                                                                      --------------------------

                                                                     2000                    1999
                                                                     ----                    ----
                                                                            (In millions)
<S>                                                               <C>                     <C>
CASH FLOWS FROM OPERATIONS:
     Net loss                                                     $    (2.5)              $   (34.4)
     Adjustments to reconcile net loss to net
       cash provided by (used for) operations:
         Depreciation and amortization                                 27.0                    28.0
         Deferred tax benefit                                          (1.6)                  (21.5)
         Change in current assets and
          liabilities, excluding acquisitions
          and dispositions                                            (13.3)                    7.0
         Other - net                                                    1.5                    (0.4)
                                                                  ---------               ---------
Net cash provided by (used for) operations                             11.1                   (21.3)
                                                                  ---------               ---------

CASH FLOWS FROM INVESTMENTS:
     Capital expenditures                                             (19.9)                   (9.0)
     Capitalized interest                                              (0.2)                   (0.5)
     Acquisition of S&G Packaging - net                                 1.4                       -
     Other investments - net                                           (0.3)                   (1.5)
                                                                  ---------               ---------
Net cash used for investments                                         (19.0)                  (11.0)
                                                                  ---------               ---------

CASH FLOWS FROM FINANCING:
     Senior debt - repayments                                          (5.7)                   (3.9)
     Revolving credit agreement borrowings - net                       46.0                    41.0
     Repayment of S&G Packaging revolving
      credit loan                                                     (32.6)                      -
     Other financing - net                                              1.2                    (0.7)
                                                                  ---------               ---------
Net cash provided by financing                                          8.9                    36.4
                                                                  ---------               ---------

Net increase in cash and equivalents                                    1.0                     4.1
Cash and equivalents, beginning of period                              10.4                     5.7
                                                                  ---------               ---------

Cash and equivalents, end of period                               $    11.4               $     9.8
                                                                  =========               =========

SUPPLEMENTAL CASH FLOW DISCLOSURES:
Cash paid for:
     Interest                                                     $    43.5               $    40.7
                                                                  =========               =========

     Income taxes                                                 $       -               $       -
                                                                  =========               =========

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING
   AND FINANCING ACTIVITIES:
     Property additions                                           $       -               $    11.1
                                                                  =========               =========

     Increase in accrued and other liabilities                    $       -               $    11.1
                                                                  =========               =========

Acquisition of S&G Packaging:
     Inventories                                                  $    28.7               $       -
                                                                  =========               =========

     Property additions                                           $    35.2               $       -
                                                                  =========               =========

     Other assets                                                 $    15.1               $       -
                                                                  =========               =========

     Trade payables, accrued and other liabilities                $    47.8               $       -
                                                                  =========               =========

     Total debt assumed before repayment                          $    32.6               $       -
                                                                  =========               =========
</TABLE>


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 March 31, 2000 and the
results of operations for the three months and six months ended March 31, 2000
and 1999, and cash flows for the six months ended March 31, 2000 and 1999,
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, 1999. For the three
months and six months ended March 31, 2000 and 1999, comprehensive loss is equal
to net loss.

2. INVENTORIES                             MARCH 31,           SEPTEMBER 30,
                                             2000                  1999
                                          ----------           ------------
                                                     (In millions)
Inventories consist of:

Finished products                         $     35.1            $      9.1
Work in process                                 63.2                  42.7
Raw materials                                   12.5                   9.0
Supplies                                        16.3                  15.0
                                          ----------            ----------
                                               127.1                  75.8
LIFO valuation adjustment                      (10.3)                 (8.7)
                                          ----------            ----------
         Total                            $    116.8            $     67.1
                                          ==========            ==========

3. CONTINGENCIES

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

On October 18 and December 4, 1995, the Company, its directors and certain of
its officers were named in complaints which were consolidated in the Court of
Chancery of the State of Delaware alleging breach of fiduciary duties on two
counts. The first count is a putative class action and the second is an alleged
derivative claim brought on behalf of the Company against the individual
defendants. Both counts allege that (i) the Company's stockholder Rights
Agreement, adopted on June 12, 1995 and approved by the Company's stockholders
on June 28, 1995; (ii) amendments to the Company's charter and by-laws, adopted
on July 21, 1995; and (iii) a redemption of warrants in June 1995 all were
designed to entrench the individual defendants in their capacities as directors
at the expense of stockholders who otherwise would have been able to take
advantage of a sale of the



                                       5
<PAGE>   8
GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
--------------------------------------------------------------------------------

Company. The complaint asks the court, among other things, to rescind the
amendments and prohibit the use of the stockholder Rights Agreement to
discourage any bona fide acquirer. In the alternative, the plaintiffs seek
compensatory damages. The court certified a class of holders of common stock as
of June 12, 1995, and their successors in interest, transferees and assignees,
immediate and remote (excluding defendants and any person, firm, trust,
corporation or other entity related to the defendants). On January 26, 2000, the
Chancery Court granted defendants' motion for summary judgment on all counts and
dismissed the class action in its entirety. Plaintiffs did not file an appeal of
the decision. The January 26, 2000 decision is final as to all class members.

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 (CMO), all actions in Louisiana arising
out of the October 23, 1995 accident have been consolidated in the Twenty-Second
Judicial district in Washington Parish, Louisiana, where plaintiffs have 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.



                                       6
<PAGE>   9
GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
--------------------------------------------------------------------------------

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.

In September 1999, notice of the class action was published and mailed to all
individuals within the geographic boundaries of the class action. A total of
3,978 persons elected to "opt out" of the class proceeding by the December 14,
1999 deadline. Of those, 3,888 have claims pending in the related Mississippi
tort litigation described below. To pursue a claim in the class action, a class
member must have completed a detailed proof of claim form by June 20, 2000.

The trial court has set a trial date of June 11, 2001 for the first 18
plaintiffs in the Louisiana class action. Those plaintiffs will be selected
randomly from geographically diverse groups of individuals who completed claim
forms. The initial Louisiana trial will be conducted in two phases. The first
phase will resolve issues of fault and punitive liability for the entire class,
in addition to compensatory damages for the initial 18 trial plaintiffs. The
second phase is the trial of punitive damages claims on behalf of the entire
class by plaintiffs, if any, who were awarded compensatory damages in phase one.
The Company and its subsidiary are vigorously contesting all claims.

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 have all
been 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 have been 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 have
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



                                       7
<PAGE>   10
GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
--------------------------------------------------------------------------------


ending on June 23, 1999. During trial, the court dismissed with prejudice the
claims of three plaintiffs. After a three-month trial, 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. Consequently,
no defendant was found liable, and no plaintiff was awarded any damages.
Finally, the jury determined that the Company was not responsible for the
conduct of its subsidiary, Gaylord Chemical Corporation. Plaintiffs' motion for
a new trial or, alternatively, judgment notwithstanding the verdict was denied
on November 16, 1999. Plaintiffs did not timely appeal the verdict or the trial
court's post-trial rulings, but they have moved to re-open the time for appeal.
The trial court has not ruled in that motion. The trial court has ordered that
the results of this 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. No trial
date has been set for the next group of Mississippi plaintiffs.

The Company and Gaylord Chemical Corporation maintain $127 million of 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. On March 30, 1999, the trial court denied all the insurers' motions
for a new trial. The eight insurers issuing policies where coverage was found
have filed an appeal of the judgment with the Louisiana Court of Appeal. The
Company and Gaylord Chemical Corporation have appealed that part of the judgment
excluding coverage under one policy. Including coverage afforded by the
settlement and by the trial court's decision, the Company and Gaylord Chemical
Corporation have in excess of $110 million in insurance coverage for the October
23, 1995 accident.



                                       8
<PAGE>   11
GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
--------------------------------------------------------------------------------

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.
The Company has moved to dismiss the complaints. 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 should not
have a material adverse effect on the Company's financial position, results of
operations or cash flows.

4. ACQUISITION OF S&G PACKAGING COMPANY L.L.C.

On October 28, 1999, the Company acquired the remaining 65 percent share of S&G
Packaging Company L.L.C. (S&G Packaging) it did not already own from
Smurfit-Stone Container Corporation (Smurfit-Stone). S&G Packaging is the
largest U.S. producer of retail paper grocery sacks and bags, consisting of six
converting plants with annual sales of approximately $250 million. In connection
with this transaction, the Company paid to Smurfit-Stone $0.5 million for its 65
percent interest and repaid through borrowings on its revolver, $32.6 million
outstanding on S&G Packaging's revolving loan facility, which was then
terminated. In addition, Smurfit-Stone forgave $4.0 million of its trade
receivable for kraft paper sold to S&G Packaging. S&G Packaging also entered
into a paper supply agreement to purchase at market prices 60,000 tons and
48,000 tons of kraft paper in fiscal 2000 and fiscal 2001, respectively, and
36,000 tons each year in fiscal 2002 through 2004, from Smurfit-Stone.

The Company has accounted for this transaction as a purchase business
combination. Beginning on November 1, 1999, the operating results of S&G
Packaging have been fully consolidated with the Company's Results of Operations.
Prior to November 1, 1999, the Company accounted for S&G Packaging under the
equity method and recognized its proportionate share of earnings, net of
amortization of goodwill, in Other Income (Expense) - Net. The integration of
S&G Packaging's corporate functions with the Company is ongoing. This
integration will provide cost savings by eliminating duplicative functions
including S&G Packaging's corporate headquarters facility. In addition, the
Company announced on January 7, 2000 that it will close the S&G Packaging
facility in Yulee, Florida to better align capacity with customer needs. The
Company has allocated approximately $3.1 million of the acquisition cost to
purchase accounting reserves relating to


                                       9
<PAGE>   12
GAYLORD CONTAINER CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -  CONCLUDED
--------------------------------------------------------------------------------

severance and closure costs. The majority of these costs will be expended over
the next 12 months. The Company will continue to evaluate its purchase
accounting reserves for severance and closure costs and the appropriateness of
its purchase price allocation.





















                                       10
<PAGE>   13

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

RESULTS OF OPERATIONS

SECOND QUARTER OF FISCAL 2000 COMPARED WITH SECOND QUARTER OF FISCAL 1999

Net sales for the second quarter of fiscal 2000 were $291.2 million compared to
net sales of $201.0 million for the second quarter of fiscal 1999. Operating
income for the current quarter was $17.2 million compared to an operating loss
of $9.5 million for the year-ago quarter. Net loss for the current quarter
totaled $3.4 million, or $0.06 per basic common share, compared to a net loss of
$19.3 million, or $0.36 per basic common share, for the year-ago quarter.

On October 28, 1999, the Company acquired the remaining 65 percent share of S&G
Packaging Company L.L.C. (S&G Packaging) it did not already own from
Smurfit-Stone Container Corporation. The operating results of S&G Packaging have
been fully consolidated with the Company's Results of Operations beginning on
November 1, 1999. The Company accounted for S&G Packaging prior to November 1,
1999, under the equity method of accounting and recognized its proportionate
share of earnings, net of amortization of goodwill, in Other Income (Expense) -
Net.

In the second quarter of fiscal 2000, sales increased approximately $50 million
due to higher volume, primarily as a result of the acquisition of the remaining
65 percent of S&G Packaging during the first quarter of fiscal 2000. Higher
average net selling prices contributed approximately $40 million in the
quarter-over-quarter comparison.

Gross margin for the second quarter of fiscal 2000 increased to $46.1 million
from $15.3 million in the prior-year quarter primarily due to higher average net
selling prices ($34 million net of $6 million higher paper costs in the
converting facilities) and higher volume ($6 million) offset somewhat by higher
fiber costs ($8 million).

Corrugated shipments increased by 3 percent in the second quarter of fiscal 2000
to 3.9 billion square feet compared to 3.8 billion square feet in the year-ago
quarter, primarily as a result of increased demand. Industrial and retail bag
shipments increased to 81 thousand tons during the second quarter of fiscal 2000
from 14 thousand tons in the prior-year quarter primarily due to the inclusion
of shipments by S&G Packaging in the second quarter of fiscal 2000. Total mill
production increased by 4 percent to 4,198 tons per day (TPD, calculated on the
basis of the number of days in the period) during the second quarter of fiscal
2000 compared to 4,033 TPD in the prior-year quarter. Quarter-over-



                                       11
<PAGE>   14


quarter, containerboard and unbleached kraft paper production increased by 5
percent to 3,454 TPD from 3,305 TPD and by 2 percent to 744 TPD from 728 TPD,
respectively, over the prior-year.

Average net selling prices for corrugated products increased by 19 percent in
the second quarter of fiscal 2000 compared with the prior-year quarter. Average
net selling prices on sales to third parties for the Company's domestic
linerboard, export linerboard and unbleached kraft paper increased by 43
percent, 33 percent and 46 percent, respectively, in the second quarter of
fiscal 2000 compared to the same quarter in the prior year.

Fiber costs increased due to higher average delivered costs for recycled fiber,
which consists primarily of old corrugated containers (OCC) and double lined
kraft (DLK) clippings. The average delivered cost of OCC and DLK increased by 79
percent and 91 percent, respectively, while the average delivered cost of wood
chips decreased by 10 percent in quarter-over-quarter comparison.

Selling and administrative costs were $28.9 million for the current quarter
compared to $24.8 million for the year-ago period. This increase was primarily
due to the inclusion of selling and administrative costs of S&G Packaging in the
consolidated results.

Net interest expense increased to $23.0 million in the second quarter of fiscal
2000 from $21.5 million in the prior-year quarter due primarily to higher
average debt levels. The higher average debt levels are due in part to the
assumption of $32.6 million of debt as a result of the acquisition of S&G
Packaging during the first quarter of fiscal 2000.

In the second quarter of fiscal 2000, the Company recognized a tax benefit of
$2.0 million compared to $11.9 million in the prior-year quarter. The effective
tax rate was 38 percent in the second quarter of fiscal 2000 and 1999.



                                       12
<PAGE>   15

FIRST SIX MONTHS OF FISCAL 2000 COMPARED WITH FIRST SIX MONTHS OF FISCAL 1999.

Net sales for the first six months of fiscal 2000 were $570.8 million compared
to net sales of $399.8 million for the first six months of fiscal 1999.
Operating income for the current six-month period was $40.1 million compared to
an operating loss of $12.6 million for the year-ago period. Net loss for the
current period totaled $2.5 million, or $0.05 per basic common share, compared
to a net loss of $34.4 million, or $0.64 per basic common share, for the
year-ago period.

In the first six months of fiscal 2000, sales increased by approximately $100
million due to higher volume, primarily as a result of the S&G Packaging
acquisition and increased volume in the corrugated converting facilities. Higher
average net selling prices contributed approximately $71 million in the
period-over-period comparison.

Gross margin for the first six months of fiscal 2000 increased to $95.5 million
from $35.7 million in the prior-year period primarily due to higher average net
selling prices ($64 million net of $7 million higher paper costs in the
converting facilities) and higher volume ($14 million) offset somewhat by higher
fiber costs ($17 million).

Corrugated shipments increased by 4 percent in the first six months of fiscal
2000 to 7.7 billion square feet compared to 7.4 billion square feet in the
year-ago period, primarily as a result of increased demand. Industrial and
retail bag shipments increased to 144 thousand tons during the first six months
of fiscal 2000 from 27 thousand tons in the prior-year period primarily due to
the inclusion of shipments by S&G Packaging in the current period. Total mill
production increased by 4 percent to 4,315 tons per day (TPD, calculated on the
basis of the number of days in the period) during the first six months of fiscal
2000 compared to 4,153 TPD in the prior-year period. Period over period,
containerboard and unbleached kraft paper production increased by 4 percent to
3,549 TPD from 3,423 TPD and by 5 percent to 766 TPD from 730 TPD, respectively,
over the prior-year period.

Average net selling prices for corrugated products increased by 17 percent in
the first six months of fiscal 2000 compared with the prior-year period. Average
net selling prices on sales to third parties for the Company's domestic
linerboard, export linerboard and unbleached kraft paper increased by 44
percent, 24 percent and 33 percent, respectively, in the first six months of
fiscal 2000 compared to the same period in the prior year.

Fiber costs increased due to higher average delivered costs for recycled fiber.
The average delivered cost of OCC and DLK



                                       13
<PAGE>   16


increased by 73 percent and 93 percent, respectively, while the average
delivered cost of wood chips decreased by 7 percent in period-over-period
comparison.

Selling and administrative costs were $55.4 million for the current period
compared to $48.3 million for the year-ago period. This increase was primarily
due to the inclusion of selling and administrative costs of S&G Packaging in the
consolidated results.

Net interest expense increased to $45.1 million in the first six months of
fiscal 2000 from $42.1 million in the prior-year period due primarily to higher
average debt levels. The higher average debt levels are due in part to the
assumption of $32.6 million of debt as a result of the acquisition of S&G
Packaging during the first quarter of fiscal 2000.

In the first six months of fiscal 2000, the Company recognized a tax benefit of
$1.5 million compared to $21.3 million in the prior-year period. The effective
tax rate was 38 percent in the first six months of fiscal 2000 and 1999.














                                       14
<PAGE>   17
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 provided by operations for the first six months of fiscal 2000 was
$11.1 million, compared with net cash used by operations of $21.3 million for
the year-ago period. The favorable change of $32.4 million was primarily due to
improved operating results in the period-over-period comparison.

Cash flows used for investing activities increased in the first six months of
fiscal 2000 to $19.0 million from $11.0 million in the year-ago period primarily
due to a $10.9 million increase in capital expenditures in the first six months
of fiscal 2000 compared to the year-ago period. In the first six months of
fiscal 1999, the Company incurred an $11.1 million liability for costs
associated with a capital project that was financed through a secured debt
obligation later in the fiscal year.

Cash flows from financing activities decreased to $8.9 million in the first six
months of fiscal 2000 from $36.4 million in the year-ago quarter. Financing
activities in the fiscal 2000 six-month period included the repayment of $32.6
million of S&G Packaging's revolving loan facility.

In fiscal 1992, the Company determined it would be unlikely that its Antioch,
California unbleached kraft paper mill (the East Mill), which was closed in
fiscal 1991, could be sold as a mill site or that the East Mill, or a portion
thereof, could be operated economically by the Company. In the first six months
of fiscal 2000, the Company incurred approximately $0.8 million of costs for
demolition and maintenance of the East Mill. Such costs were net of proceeds
from the sale of scrap. At March 31, 2000, approximately $0.5 million of
spending remained to complete the demolition work. Management expects to
complete the remaining demolition during fiscal 2000. At March 31, 2000, the
balance sheet reserve for demolition was approximately $0.5 million and the net
book value of the East Mill was $10.7 million.

In connection with the acquisition of S&G Packaging, the Company has allocated
approximately $3.1 million of the acquisition costs to purchase accounting
reserves relating to severance and closure costs associated with the integration
of S&G Packaging's




                                       15
<PAGE>   18


Corporate headquarter facility and the closure of the S&G Packaging facility in
Yulee, Florida. In the period from November 1, 1999, the date of the
acquisition, through March 31, 2000, amounts expended related to such costs were
$0.7 million. The balance of the related reserve at March 31, 2000, including
amounts recorded through operations in the first and second quarters of fiscal
2000 in respect of the Company's pre-existing 35% ownership of S&G Packaging,
was $3.7 million. The majority of these restructuring costs will be expended
over the next 12 months.

LIQUIDITY

At March 31, 2000, the Company had cash and equivalents of $11.4 million, an
increase of $1.0 million from September 30, 1999, as cash provided by operating
and financing activities exceeded cash used for investments. Total debt
increased $41.2 million to $976.9 million at March 31, 2000 from $935.7 million
at September 30, 1999 as a result of increased revolver borrowings. The increase
in revolver borrowings was primarily due to the repayment of the S&G Packaging
revolving loan facility. At March 31, 2000, the Company had $138 million of
borrowings outstanding, and $101.5 million of credit available under the
revolving portions of its credit agreements.

At March 31, 2000, the Company had primary working capital (Trade receivables
plus Inventories less Trade payables) of $203.6 million, an increase of $42.9
million from September 30, 1999, mainly due to primary working capital acquired
in the S&G Packaging acquisition.

Consolidation among major containerboard industry producers during the past 12
to 24 months has resulted in the "mothballing" of approximately 5 percent of the
domestic containerboard capacity. This rationalization, combined with limited
new containerboard capacity additions and stable domestic demand growth, has
resulted in relatively balanced industry supply/demand conditions. Published
industry prices for linerboard remained unchanged from September 1999 through
December 1999 and increased approximately 12% from December 1999 to March 2000.
Published industry prices for kraft paper remained unchanged during the
six-month period ended March 31, 2000. Due to continuing strong market
conditions, the Company implemented a price increase of $50 per ton for
linerboard effective February 1, 2000 and announced related price increases in
corrugated products effective March 1, 2000. In addition, during the second
quarter the Company announced a $50 per ton increase in the price of unbleached
kraft grocery bag and sack paper and a related retail bag price increase.

The Company's average delivered costs of OCC and DLK increased by 16% and 10%
respectively, in the second quarter of fiscal 2000



                                       16
<PAGE>   19


compared to the first quarter of fiscal 2000, while the average delivered cost
of wood chips decreased by 4% 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.

Based on current prices for converted products and current raw material costs,
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 product
price improvement beyond current levels for converted products; however, the
Company will need to seek additional covenant modifications to its bank credit
agreement by the end of March 2001 to maintain continued access to its
liquidity.

PENDING ACCOUNTING STANDARDS

In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133, "Accounting for Derivative Instruments
and Hedging Activities" ("SFAS 133"), which establishes accounting and reporting
standards for derivative instruments. An amendment to SFAS 133 was issued in
July 1999, which defers by one year the effective date of SFAS 133 to fiscal
years beginning after June 15, 2000. The statement will be adopted by the
Company in fiscal 2001. The Company has not yet determined what effect, if any,
the statement will have on its results of operations or financial position.

YEAR 2000 READINESS DISCLOSURE

The "Year 2000 Issue" refers generally to the potential problems that software
and processing systems could encounter in determining the correct century for
the year. Software and processing systems with date-sensitive functions that are
not Year 2000 compliant may not be able to distinguish whether "00" means 1900
or 2000, which may result in system failures or the creation of erroneous
results.

Following the end of the Company's fiscal year in September 1999, the calendar
year in December 1999 and the passing of leap year 2000, the Company experienced
no major incidents related to the Year 2000 Issue.

The Company incurred approximately $5.0 million to correct potential problems
related to the Year 2000 Issue. The Company funded its Year 2000 effort with
cash from operations and borrowings under its revolving credit agreements.




                                       17
<PAGE>   20



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



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, YEAR 2000 READINESS ISSUES,
POTENTIAL EQUIPMENT MALFUNCTIONS AND PENDING LITIGATION. FOR ADDITIONAL
INFORMATION SEE THE COMPANY'S FORM 10-K FILING FOR THE MOST RECENT FISCAL YEAR.











                                       18
<PAGE>   21
                           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.

         On February 8, 2000, the Company held its annual meeting of
         stockholders at which the following issues were voted upon by holders
         of the Company's common stock:

The Company's ten directors were re-elected by the following vote:

                                                 For                Withheld
                                             -----------------------------------
         Mary Sue Coleman                    51,191,079               428,610
         Harve A. Ferrill                    51,203,949               415,730
         John E. Goodenow                    51,205,449               414,230
         David B. Hawkins                    51,205,249               414,430
         Warren J. Hayford                   51,296,899               322,780
         Charles S. Johnson                  47,615,660             4,004,029
         Jerry W. Kolb                       51,195,349               424,330
         Ralph L. MacDonald Jr.              51,205,449               414,230
         Marvin A. Pomerantz                 51,302,668               317,021
         Thomas H. Stoner                    51,204,349               415,330

An increase of 1,500,000 shares available under the Company's 1997 Long-Term
Equity Incentive Plan was approved by a vote of 31,915,966 for; 19,725,899
against; 61,153 withheld.

The appointment of Deloitte & Touche LLP to continue to serve as the Company's
independent auditors in fiscal 2000 was ratified by a vote of 51,614,741 for;
69,071 against; 19,205 withheld.

Item 5.  Other Information.

         On April 18, 2000, Dale E. Stahl resigned as the Company's President
         and Chief Operating Officer. On the same date, the Board of Directors
         elected Michael J. Keough to the position of President and Chief
         Operating Officer. Mr. Keough was previously Vice President and General
         Manager, Container Operations. Concurrently, Daniel P. Casey, Executive
         Vice President and Chief Financial Officer was elected to the Board of
         Directors and named Vice Chairman. Mr. Casey continues as Chief
         Financial Officer.



                                       19
<PAGE>   22
Item 6.  Exhibits and Reports on Form 8-K.

a) Exhibits

         Number and Description of Exhibit
         ---------------------------------

         4.1 Amendment No. 1 to the Gaylord Container Corporation 1997
             Long-Term Equity Incentive Plan, incorporated by
             reference to Exhibit 4.5 of the Registrant's Form S-8
             Registration Statement under the Securities Act of 1933,
             filed with the Securities and Exchange Commission on
             April 6, 2000.

         27.1 Financial Data Schedule - filed herein.

b) No reports on Form 8-K were filed for the quarter ended March 31, 2000.






                                       20
<PAGE>   23
                                   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:  May 12, 2000                     /s/ Marvin A. Pomerantz
                                        ---------------------------------
                                        Marvin A. Pomerantz
                                        Chairman and Chief Executive Officer


Date:  May 12, 2000                     /s/ Jeffrey B. Park
                                        ---------------------------------
                                        Jeffrey B. Park
                                        Vice President, Finance
                                        (Principal Accounting Officer)








                                       21