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                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


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                                   FORM 10-QSB
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                QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                     For fiscal quarter ended July 31, 1999
                         Commission File Number: 0-24846

                          COLORADO CASINO RESORTS, INC.
             (Exact name of Registrant as specified in its Charter)


           Texas                                                  84-1303693
(State or other jurisdiction of                                 (IRS Employer
incorporation or organization)                               Identification No.)

                             One South Nevada Street
                                    Suite 200
                           Colorado Springs, CO 80903
                                 (719) 635-7047
          (Address, including zip code, and telephone number, including
             area code, of Registrant's principal executive offices)


      SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE EXCHANGE ACT:
                         Common Stock, $0.001 Par Value
                                (Title of Class)

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Check 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 [ ]

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common  stock as of the latest  practicable  date:  38,740,632  shares of common
stock, $0.001 par value per share.

Transitional Small Business Disclosure Format: Yes [X]  No [   ]

                      DOCUMENTS INCORPORATED BY REFERENCE:
                                      None.


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

<PAGE>

Colorado Casino Resorts, Inc.
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEETS (Unaudited)
                                                        July 31,     October 31,
                                                         1999            1998
                                                     -----------    ------------
<S>                                                  <C>             <C>
                               ASSETS

CURRENT ASSETS
Cash & cash equivalents ........................     $ 2,592,163     $ 1,573,519
Inventory ......................................          62,137          96,429
Advances to officers ...........................         110,443         125,443
Other ..........................................         339,519         349,781
                                                     -----------     -----------
   TOTAL CURRENT ASSETS ........................       3,104,263       2,145,172
                                                     -----------     -----------

REAL ESTATE HELD FOR FUTURE DEVELOPMENT ........       3,250,000       3,250,000
                                                     -----------     -----------

LAND, BUILDING AND EQUIPMENT - NET .............      38,297,350      40,459,018
                                                     -----------     -----------

OTHER ASSETS
   Debt issue cost .............................         240,177         359,819
   Debt extension cost .........................            --           158,100
   Deposits ....................................          63,108          63,108
                                                     -----------     -----------
TOTAL OTHER ASSETS .............................         303,285         581,027
                                                     -----------     -----------

   TOTAL ASSETS ................................     $44,954,898     $46,435,217
                                                     ===========     ===========

</TABLE>


                     [THIS SECTION INTENTIONALLY LEFT BLANK]




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

                                      -2-
<PAGE>
<TABLE>
<CAPTION>
                                                                  July 31,      October 31,
                                                                    1999           1998
                                                                ----------      ----------
<S>                                                             <C>             <C>
                LIABILITIES & STOCKHOLDERS' EQUITY [DEFICIENCY]

CURRENT LIABILITIES
   Revolving Credit Facility ..............................     15,297,133      13,655,296
   Accounts payable .......................................      1,527,436         349,320
   Accrued expenses .......................................        910,160       1,303,328
   Slot club liability ....................................        446,686         348,949
   Incremental progressive slot liability .................        311,842         374,264
   Current maturities - long term debt ....................      5,124,967      10,819,963
   Current maturities - long term debt, related party .....           --         7,796,411
   Convertible debenture, related party ...................         26,402       4,500,000
   Current maturities - capital lease obligations .........        629,787
                                                                                 5,044,745
   Interest payable .......................................      3,083,649       1,252,825
   Interest payable - related party .......................      2,051,746       1,953,240
   Interest payable - convertible debentures, related party        684,507         909,261

   Due to officers ........................................           --            30,000
   Other current liabilities ..............................        169,095          99,711
                                                              ------------    ------------
   TOTAL CURRENT LIABILITIES ..............................     31,594,718      44,022,355

LONG-TERM DEBT-LESS CURRENT PORTION .......................     20,367,754       3,908,702
CAPITAL LEASE OBLIGATIONS-LESS CURRENT PORTION ............        493,417         667,437

                                                              ------------    ------------
   TOTAL LIABILITIES ......................................     52,455,889      48,598,494
                                                              ------------    ------------

STOCKHOLDERS' EQUITY [DEFICIENCY]

   Preferred convertible stock, Series One, $10 par value
     5,000,000 shares authorized, None and None
     issued and outstanding, respectively .................           --              --

   Common stock, $0.001 par value, 100,000,000
     shares authorized, 38,740,632 and 38,740,632
     issued and outstanding, respectively .................         38,741          38,741

   Paid-in capital ........................................     19,025,188      19,025,188
   Deferred compensation ..................................        (81,500)        (81,500)
   Accumulated deficit ....................................    (26,483,420)    (21,145,706)
                                                              ------------    ------------
   TOTAL STOCKHOLDERS' DEFICIENCY .........................     (7,500,991)     (2,163,277)
                                                              ------------    ------------

   TOTAL LIABILITIES & STOCKHOLDERS' DEFICIENCY ...........   $ 44,954,898    $ 46,435,217
                                                              ============    ============
</TABLE>


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

                                      -3-
<PAGE>
Colorado Casino Resorts, Inc.
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)

                                  Nine Months     Quarter     Nine Months      Quarter
                                     Ended         Ended         Ended          Ended
                                    July 31,      July 31,      July 31,       July 31,
                                     1999          1999           1998           1998
                                 ----------    -----------    -----------    -----------
<S>                              <C>           <C>            <C>            <C>
OPERATING REVENUES
  Casino ....................    15,930,996      6,232,483     12,953,010      4,955,845
  Rooms .....................     1,678,946        669,105      1,677,149        771,244
  Food & Beverage ...........     1,674,468        676,379      1,566,947        663,228
  Other .....................       240,846         63,947        415,087        208,116
                                -----------    -----------    -----------    -----------
     TOTAL OPERATING REVENUE     19,525,256      7,641,914     16,612,194      6,598,433
                                -----------    -----------    -----------    -----------

OPERATING EXPENSES
  Casino ....................     5,812,941      1,520,609      6,035,558      2,034,051
  Rooms .....................       781,303        266,463        801,270        271,863
  Food & Beverage ...........     2,141,247        788,033      2,070,939        780,556
  Marketing .................     4,480,476      1,783,698      2,922,258      1,144,764
  General & Administrative ..     4,358,624      1,549,107      3,388,809      1,864,773
  Depreciation & Amortization     3,036,395        957,916      1,613,478        516,704
                                -----------    -----------    -----------    -----------
     TOTAL OPERATING EXPENSE     20,610,986      6,865,826     16,832,312      6,612,711
                                -----------    -----------    -----------    -----------

INCOME/(LOSS FROM OPERATIONS     (1,085,730)       776,088       (220,118)       (14,278)
                                -----------    -----------    -----------    -----------

NONOPERATING INCOME (EXPENSE)
   Interest Expense .........     4,251,986      1,367,053      4,324,465      2,068,203
                                -----------    -----------    -----------    -----------

LOSS BEFORE INCOME TAXES ....    (5,337,716)      (590,965)    (4,544,583)    (2,082,481)

INCOME TAXES ................             0              0              0              0
                                -----------    -----------    -----------    -----------

NET LOSS ....................    (5,337,716)      (590,965)    (4,544,583)    (2,082,481)
                                ===========    ===========    ===========    ===========

NET LOSS PER COMMON SHARE ...       (0.1378)       (0.0153)       (0.1175)       (0.0539)
                                ===========    ===========    ===========    ===========

WEIGHTED AVERAGE NUMBER
     OF SHARES OUTSTANDING ..    38,740,642     38,740,642     38,666,000     38,666,000
                                ===========    ===========    ===========    ===========
</TABLE>




                     [THIS SECTION INTENTIONALLY LEFT BLANK]




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

                                      -4-
<PAGE>





Colorado Casino Resorts, Inc.
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENT OF CASHFLOWS (Unaudited)

                                                              Nine Months Ended Nine Months Ended
                                                                   July 31,       July 31,
                                                                    1999           1998
                                                               ------------    ------------
<S>                                                            <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss ...................................................   $ (5,337,716)   $ (4,544,583)
Noncash Items
      Depreciation & Amortization ..........................      2,916,753       1,613,478
      Amortization of Debt Issue Costs .....................        119,642         593,675
(Increase) Decrease in:
      Inventory ............................................        (34,292)         51,560
      Other Current Assets .................................        (10,262)        121,100
      Other Assets .........................................        247,211        (419,023)
(Decrease) Increase In:
      Accounts Payable .....................................      1,178,116            --
      Incremental Progressive Slot Liability ...............        (62,422)           --
      Slot Club Liability ..................................         97,737            --
      Interest Payable .....................................      1,704,576         714,966
      Accrued Other Expenses ...............................       (393,168)        603,305
      Other Current Liabilities ............................         69,384            --
                                                               ------------    ------------
            Net Cash Provided (Used) By Operating Activities        495,558      (1,265,522)
                                                               ------------    ------------

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of Land, Building & Equipment .....................       (755,085)     (3,917,387)
Advances to Officers .......................................        (15,000)           --
                                                               ------------    ------------
            Net Cash Provided (Used) By Investing Activities       (770,085)         51,850
                                                               ------------    ------------

CASH FLOWS FROM FINANCING ACTIVITIES
Advances From Officers .....................................           --           (62,745)
Borrowings, Long-Term Debt .................................      1,725,530      16,792,873
Repayments, Long-Term Debt .................................       (266,028)    (11,667,028)
Repayments, Long-Term Debt, Related Party ..................       (166,330)       (145,701)
                                                               ------------    ------------
            Net Cash Provided (Used) By Financing Activities      1,293,172       4,917,399
                                                               ------------    ------------

INCREASE (DECREASE) IN CASH AND EQUIVALENTS ................      1,018,644        (265,510)
CASH AND EQUIVALENTS, BEGINNING ............................      1,573,519       1,962,486
                                                               ------------    ------------

CASH AND EQUIVALENTS, ENDING ...............................   $  2,592,163    $  1,696,976
                                                               ============    ============
</TABLE>





                     [THIS SECTION INTENTIONALLY LEFT BLANK]




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

                                      -5-
<PAGE>


                  COLORADO CASINO RESORTS, INC. & SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



Note A:       Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial  information  and with the  instructions  to Form 10-QSB of Regulation
S-X.  Accordingly,  they do not include  all of the  information  and  footnotes
required by generally  accepted  accounting  principles  for complete  financial
statements. In the opinion of management,  all adjustments (consisting of normal
recurring  accruals)  considered  necessary  for a fair  presentation  have been
included.  Operating  results for the nine month  period ended July 31, 1999 are
not  necessarily  indicative  of the results  that may be expected  for the year
ended  October  31,  1999.  The  unaudited  condensed   consolidated   financial
statements  should  be read  in  conjunction  with  the  consolidated  financial
statements and the footnotes  thereto included in the Company's annual report on
Form 10-KSB for the year ended October 31, 1998.

Note B:       Long Term Debt

 On May 19, 1999 the  Company  executed  note  modification  agreements  for its
outstanding  unsecured debt of $18,646,411.  These agreements reduced the annual
interest rates from a weighted average of 15.47% to a new average rate of 7.39%.
In  addition,  the  agreements  extended  the  maturity  date for the payment of
principal  and  accrued  interest  to December  31,  2001.  As a result of these
modifications,  there is a  substantial  reduction  in interest  expense for the
quarter ended July 31, 1999, and this debt is  reclassified on the balance sheet
from current debt to long-term debt.



                                      -6-
<PAGE>

                  COLORADO CASINO RESORTS, INC. & SUBSIDIARIES


         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                           PLANS FOR FUTURE OPERATIONS


RESULTS OF OPERATIONS

The Company has made several restatements and reclassifications to the Company's
1997  and  1996  fiscal  year  financial  statements.  The  restatements  relate
principally from: (i) the reclassification and accounting for the Company's slot
machines, other leased assets and its licensed software; (ii) interest and other
expenses related to the Company's  convertible  preferred stock, stock warrants,
convertible  debentures,  tokens and chips and computer player tracking  system;
and  (iii)  the   reclassification   of  certain   one-time  casino  revenue  to
extraordinary  gain. The financial  information  contained herein for the fiscal
quarter ended July 31, 1998 has not been amended to reflect such restatement and
reclassifications;  therefore,  the  comparability  of this period to the fiscal
quarter ended July 31, 1999 may be affected.

Quarter Ended July 31, 1999 Compared to Quarter Ended July 31, 1999

The Company  reported  total  operating  revenues for the quarter ended July 31,
1999 of  $7,641,914,  an  increase of  $1,043,481,  or 15.8%,  from  revenues of
$6,598,433  reported for the same quarter in 1998. Total operating  expenses for
the quarter were  $6,865,826 for the quarter ended July 31, 1999,  increasing by
$253,115,  or 3.8% from $6,612,711  reported for the same quarter in 1998. Total
operating  expenses as a percentage  of total  revenues  decreased to 89.8% from
100.2%  reported  in the  comparable  period of 1998,  as result of higher  slot
machine  revenue  and  significant   cost  control   measures.   There  were  no
acquisitions or any sale of stock during this quarter.

Casino.  Casino revenues  accounted for approximately 82% of the total operating
revenues in third quarter of 1999.  For the quarter ended July 31, 1999,  casino
revenues  were  $6,232,483,  representing  an  increase of  $1,276,638  from the
$4,955,845  reported during the same period in 1998.  Management  attributes the
increase in casino  revenue to improved  customer  patronage  resulting from the
increased payout percentages and the marketing campaign deployed during the fall
and winter of 1998 to  advertise  this fact,  as well as the  addition  of a new
delicatessen  and the paving of the  parking  area at the Double  Eagle  Hotel &
Casino.

Costs and expenses of casino  operations  were  $1,520,609 for the quarter ended
July 31, 1999, a decrease of $513,442, or 25.2%, from the $2,034,051 reported in
1998.  The  net  decrease  in  costs  and  expenses  of  casino   operations  is
attributable   to  the   reclassification   of  $400,323   of  slot   department
complimentary  expenses to the marketing  department,  and  significantly  lower
costs for equipment rental and outside  contractual  services.  Casino costs and
expenses as a percentage of casino  revenues  decreased to 24.4% for the quarter
ended July 31, 1999 compared to 41.0% for the comparable period in 1998.

Rooms.  Room  revenues  accounted  for  approximately  8.8% of  total  operating
revenues for the quarter ended July 31, 1999. During this period,  room revenues
were $669,105,  representing a decrease of $102,139, or 13.2%, from the $771,244
reported  in the same  period in 1998.  The  decline in  revenues  is  primarily
attributable to fewer  marketing and incentive  offers directed at the Company's
rated  players  during  the 1999  period,  and  less  cash  sales  due to a more
competitive environment.  Despite the decrease in revenue, costs and expenses of
hotel  operations  for the quarter  ended July 31, 1999 were  essentially  flat,
decreasing  $5,400,  or 2.0%, to $266,463,  from  $271,863  reported in the same
period in 1998. Costs and expenses as a percentage of room revenues increased to
39.8% in the quarter ended July 31, 1999 from 35.2% during the comparable period
in 1998.

Food  and  Beverage.  Food and  beverage  revenues  accounted  for 8.9% of total
revenues  for the quarter  ended July 31,  1999.  During this  period,  food and
beverage revenues were $676,379,  representing an increase of $13,151,  or 2.0%,
from the $663,228  reported in the 1998  period.  Costs and expenses of food and
beverage were $788,033 for the 1999 period,  up $7,477,  or 1.0%,  from $780,556
recorded in the 1998  period.  Costs and  expenses as a  percentage  of food and
beverage revenues decreased slightly to 116.5% in the 1999 period from 117.7% in
the 1998 period.

Other.  Other  revenues  consists of revenues  generated from the Company's gift
shop and parking lot operations.  During the quarter ended July 31, 1999,  other
revenues were $63,947, down by $144,169, or 69.3%, from $208,116 reported in the
1998 period.  This decrease is mainly  attributable to the Company's decision to
eliminate parking fees for casino  customers.  The fee was discontinued in April
1999 as a result of competitive pressure.

                                      -7-
<PAGE>
Marketing.  Marketing  expenses were  $1,783,698  for the quarter ended July 31,
1999, up significantly by $638,934 or 55.8% from the $1,144,764  reported in the
1998 period. However, the increase is primarily due to complimentary expenses of
$770,756 that were charged to individual  departments  in the prior year and are
now being charged to the marketing  department.  Expenditures were down from the
prior year as media  advertising and other  expenditures were reduced during the
quarter. Marketing expenses as a percentage of total revenues increased to 23.3%
for the quarter ended July 31, 1999 compared to 17.3% reported in 1998.

General and Administrative.  General and administrative expenses were $1,549,107
for the quarter ended July 31, 1999,  down $315,666 or 16.9% from the $1,864,773
reported  in the 1998  period.  This  decrease is due  primarily  to higher than
normal  legal and  accounting  fees in the prior year  related  to the  Foothill
Credit  Facility  loan  execution.  General  and  administrative  expenses  as a
percentage of total  revenues  decreased to 20.3% for the quarter ended July 31,
1999 from 28.3% for the comparable period in 1998.

Depreciation  and  Amortization.  Depreciation  and  amortization  increased  by
$441,212,  or 85.4% to $957,916 for the quarter ended July 31, 1999, compared to
$516,704  reported  in 1998.  This  difference  is the result of a change in the
estimated lives of many of the Company's  assets,  specifically in the reduction
of the slot machine lives from five years to three years.

Income from Operations.  As a result of the factors discussed above, the Company
recognized  income from  operations  of $776,088 for the quarter  ended July 31,
1999 as  compared  to a loss from  operations  of $14,278  recorded  in the 1998
period.

Interest Expense. Interest expense was $1,367,053 for the quarter ended July 31,
1999, a decrease of $701,150,  or 33.9%,  from the  $2.068,203  reported for the
comparable  period in 1998.  This decrease is due to the  re-negotiation  of the
terms  of the  unsecured  debt  at the  parent  level,  yielding  a  significant
reduction in interest rates (See Note B).

Net Loss.  The net loss for the Company was $590,965 for the quarter  ended July
31, 1999, a decrease of  $1,491,516,  or 71.6%,  from the net loss of $2,082,481
reported in the 1998 period.

Nine Months Ended July 31, 1999 Compared to Nine Months Ended July 31, 1999

The Company reported total operating revenues for the nine months ended July 31,
1999 of  $19,525,256,  an increase of  $2,913,062,  or 17.5%,  from  revenues of
$16,612,194  reported for the same period in 1998. Total operating expenses as a
percentage  of total  revenues  increased to 105.6% from 101.3%  reported in the
comparable  period  of  1998,  due to an  increase  in  marketing,  general  and
administrative, and depreciation expenses.

Casino.  Casino revenues  accounted for approximately 82% of the total operating
revenues in the nine months ended July 31, 1999. Casino revenues for this period
were  $15,930,996  representing  an increase of $2,977,985,  or 23.0%,  from the
$12,953,011  reported  during the same period in 1998.  This  increase in casino
revenue is due to  improved  customer  patronage  resulting  from the  increased
payout  percentages and the marketing  campaign deployed to advertise this fact,
as well as the  addition  of a new  delicatessen  and the paving of the  parking
area.

Costs and  expenses of casino  operations  were  $5,812,941  for the nine months
ended July 31,  1999,  a decrease  of  $222,617,  or 3.7%,  from the  $6,035,558
reported in 1998. The net decrease in costs and expenses of casino operations is
attributable   to  the   reclassification   of  $400,323   of  slot   department
complimentary  expenses to the marketing  department,  and  significantly  lower
costs for equipment rental and outside  contractual  services.  Casino costs and
expenses as a  percentage  of casino  revenues  decreased  to 36.5% for the nine
months ended July 31, 1999, compared to 46.6% for the comparable period in 1998.

Rooms.  Room  revenues  accounted  for  approximately  8.6% of  total  operating
revenues  for the nine months  ended July 31,  1999.  During this  period,  room
revenues  were  $1,678,946,  a  slight  increase  of  $1,797,  or .1%  from  the
$1,677,149  reported in the same period in 1998.  The lack of growth in revenues
is primarily  attributable to fewer  marketing and incentive  offers directed at
the Company's rated players during the 1999 period, and less cash sales due to a
more  competitive  environment.  Costs and expenses of hotel  operations for the
nine month period ended July 31, 1999 were down slightly, decreasing $19,967, or
2.5%, to $781,303,  from $801,270 reported in the same period in 1998. Costs and
expenses as a percentage of room revenues  decreased to 46.5% in the nine months
ended July 31, 1999 from 47.8% during the comparable period in 1998.

Food and Beverage.  Food and beverage revenues  accounted for approximately 8.6%
of total  revenues for the nine months ended July 31, 1999.  During this period,
food  and  beverage  revenues  were  $1,674,468,  representing  an  increase  of
$107,251,  or 6.9%,  from the  $1,566,947  reported  in the  1998  period.  This
increase is primarily  attributable  to  additional  casino  customer  patronage
during the period.  Costs and expenses of food and beverage were  $2,141,247 for
the 1999  period,  up $70,308,  or 3.4%,  from  $2,070,939  recorded in the 1998
period.  Costs  and  expenses  as a  percentage  of food and

                                      -8-
<PAGE>
beverage revenues decreased to 127.9% in the 1999 period from 132.2% in the 1998
period,  reflecting  the cost savings  derived from the conversion of the Double
Eagle restaurant to a buffet format.

Other.  Other  consists of revenues  generated  from the Company's gift shop and
parking  lot  operations.  During the nine  months  ended July 31,  1999,  other
revenues were $240,846,  down by $174,241,  or 42.0%, from the $415,087 reported
in the 1998  period.  This  decrease  is mainly  attributable  to the  Company's
decision  to  eliminate  parking  fees  for  casino   customers.   The  fee  was
discontinued in April 1999 as a result of competitive pressure.

Marketing. Marketing expenses were $4,480,476 for the nine months ended July 31,
1999, up  significantly  by $1,832,087 or 69.2% from the $2,648,389  reported in
the 1998 period.  The increase in marketing  expense reflects  increases in slot
club point awards and cash  disbursements made to patrons upon the redemption of
bus  coupons.  In addition,  most  complimentary  expenses  that were charged to
individual  departments in the prior year are now being charged to the marketing
department.  Marketing  expenses as a  percentage  of total  revenues  increased
slightly  to 22.9% for the nine months  ended July 31,  1999  compared to 22.05%
reported in 1998.

General and Administrative.  General and administrative expenses were $4,358,624
for the nine  months  ended  July  31,  1999,  up  $695,946,  or 19.0%  from the
$3,662,678  reported in the 1998 period.  This increase is due to higher payroll
expenses  due to staff  growth,  and an  increase  in legal  fees.  General  and
administrative  expenses as a percentage of total revenues increased slightly to
22.3% for the nine  months  ended July 31,  1999 from  22.0% for the  comparable
period in 1998.

Depreciation  and  Amortization.  Depreciation  and  amortization  increased  to
$3,036,395  for the nine months  ended July 31,  1999,  compared  to  $1,613,478
reported in 1998. This increase is the result of a change in the estimated lives
of many of the  Company's  assets,  specifically  in the  reduction  of the slot
machine lives from five years to three years.

Loss from  Operations.  As a result of the factors  discussed above, the Company
recognized a loss from  operations of $1,085,730  for the nine months ended July
31, 1999 as compared to a loss from operations of $220,118  recorded in the 1998
period.

Interest Expense. Interest expense was $4,251,986 for the nine months ended July
31, 1999, a decrease of $72,479,  or 1.7%, from the $4,324,465  reported for the
comparable  period in 1998.  This decrease is due to the  re-negotiation  of the
terms of the  unsecured  debt at the parent  level,  through which a significant
reduction  in  interest  rates  was  realized,  as well as an  extension  of the
maturity dates to December 31, 2001.  These  amendments were effective April 30,
1999 (See Note B).

Net Loss.  The net loss for the Company was $5,337,716 for the nine months ended
July 31, 1999, an increase of $793,133, or 17.5% from the net loss of $4,544,583
reported in the 1998 period.

Liquidity and Capital Resources

The Company has  historically  financed its operations and capital  expenditures
with  borrowings  from  private  investors,  the sale of equity  securities  and
private transactions and financial institution  borrowing.  The Company does not
believe  that it will be able to  continue  to finance  its  operations  in this
manner without first restructuring its existing indebtedness.

As of July 31, 1999,  the Company was in default under its credit  facility with
Foothill  Corporation  for not maintaining  EBITDA  (earnings  before  interest,
taxes,  depreciation  and  amortization,  as  defined)  of at least  $4  million
measured on a rolling 12-month basis. The Company was also in default of certain
other indebtedness.  As a result of those defaults, Foothill Corporation has put
certain  restrictions on the Company's  operations and has no obligation to make
additional loans for working capital purposes.

As a result of the Company's  default on its  indebtedness,  the Company had, at
July 31,  1999,  liabilities  in excess of $31  million  due within one year and
current assets of only approximately $3.1 million. Unless the Company is able to
restructure  its  indebtedness,  the  Company  will  not  be  able  to  pay  its
indebtedness  when due,  with the result that the Company may be forced to cease
operations.  The  Company  is in  active  negotiations  with  its  creditors  to
restructure its  indebtedness.  Any  restructuring may involve the filing by the
Company of a voluntary  bankruptcy  petition.  It is likely that any  bankruptcy
proceeding  involving the Company will result in a very substantial  dilution or
elimination of the interests of the Company's current stockholders.


                                      -9-

<PAGE>
YEAR 2000 COMPLIANCE

The   inability   of   computers,   software  and  other   equipment   utilizing
microprocessors  to  recognize  and properly  process  data fields  containing a
two-digit year is commonly referred to as the Year 2000 compliance issue. As the
Year 2000 approaches,  such systems may be unable to accurately  process certain
date-based information.

The Company is in the  process of  identifying  and  modifying  all  significant
hardware and software applications that will require modification to ensure Year
2000  compliance.  Relying  primarily  on  internal  resources,  the Company has
completed  a  preliminary  audit  of  its  significant   hardware  and  software
applications.  This audit  revealed that the player  tracking  software that the
Company licenses from IGT and certain  personal  computers used in the Company's
casino operations may not presently be Year 2000 compliant. The Company has been
advised by IGT and its personal computer  manufacturer that such systems will be
Year 2000  compliant  as of October  1999.  The  estimated  cost to address  the
Company's  Year 2000  issues is not  expected  to have a material  impact on the
Company's business,  operations or financial  condition.  If the modification of
the Company's hardware and software compliance is not timely completed or is not
fully effective, the Year 2000 problem may have a serious negative impact on the
operations of the Company.

Although the Company has communicated  with its external  service  providers and
vendors to ensure that the  providers  and  vendors  are taking the  appropriate
action to address  Year 2000  issues and has not  received  any notice from such
persons that their  operations will not be Year 2000 compliant,  there can be no
assurance that the systems of third parties on which the Company's  systems rely
will be timely converted.

                                      -10-
<PAGE>
                           FORWARD-LOOKING STATEMENTS


In  connection  with  the  safe  harbor  provisions  of the  Private  Securities
Litigation  Reform  Act of 1995  (the  "Reform  Act"),  the  Company  is  hereby
providing cautionary  statements  identifying important factors that could cause
the  Company's  actual  results to differ  materially  from those  projected  in
forward-looking  statements  (as such term is defined in the Reform Act) made by
or on behalf of the  Company  herein or  orally,  whether in  presentations,  in
response to questions or otherwise.  Any  statements  that  express,  or involve
discussions as to,  expectations,  beliefs,  plans,  objectives,  assumptions or
future events or performance (often, but not always, through the use of words or
phrases such as  "intends,"  "plans,"  "will  result,"  "are expected to," "will
continue," "is  anticipated,"  "estimated,"  "projection" and "outlook") are not
historical facts and may be forward-looking  and,  accordingly,  such statements
involve  estimates,  assumptions,  and  uncertainties  which could cause  actual
results  to  differ  materially  from  those  expressed  in the  forward-looking
statements.  Such  uncertainties  include  the  risk  factors  set  forth in the
Company's  Annual  Report on Form 10-KSB for the fiscal  year ended  October 31,
1998.  They also include the  following  conditions or  uncertainties:  (i) risk
associated with real estate  ownership,  operations and  development,  including
environmental  liabilities,  worker's strikes,  construction  delays,  obtaining
building permits and necessary  zoning changes;  (ii) illiquidity of real estate
holdings; (iii) imposition of new regulatory requirements affecting the Company;
(iv) the delay or failure to properly  manage  growth;  (v) effect of  uninsured
loss; and (vi) breakdown of water, sewage or other municipal services in Cripple
Creek and other  conditions  beyond the  control  of the  Company.  The  Company
cautions  that actual  results or outcomes  could differ  materially  from those
expressed in any forward-looking statements made by or on behalf of the Company.
Any forward-looking statement speaks only as of the date on which such statement
is made, and the Company undertakes no obligation to update any  forward-looking
statement or statements  to reflect  events or  circumstances  after the date on
which such  statement  is made or to reflect  the  occurrence  of  unanticipated
events.  New  factors  emerge  from  time to time,  and it is not  possible  for
management to predict all of such factors. Further, management cannot assess the
impact of each such factor on the business or the extent to which any factor, or
combination of factors, may cause actual results to differ materially from those
contained in any forward-looking statements.

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB and Article 10 of
Regulation  S-X.  Accordingly,  they do not include all of the  information  and
footnotes  required by generally  accepted  accounting  principles  for complete
financial statements. In the opinion of management,  all adjustments (consisting
of normally  recurring  accruals)  considered  necessary for a fair presentation
have been included.

Operating  results  for the quarter  ending  July 31,  1999 are not  necessarily
indicative  of the results that may be expected for the year ending  October 31,
1999.  For  further  information,  refer  to  the  consolidated  statements  and
footnotes included in the Registrant's annual report on Form 10-KSB for the year
ending October 31, 1998.


                                      -11-
<PAGE>
                  COLORADO CASINO RESORTS, INC. & SUBSIDIARIES


                                   SIGNATURES

Pursuant to the  requirements  of Section 13 or 15(d) of the  Securities  Act of
1934, as amended, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized this 10th day of September,
1999.

                               COLORADO CASINO RESORTS, INC.

September 10, 1999        By:     /s/ Michael S. Smith
                               --------------------------------------------
                               Michael S. Smith
                               Interim President and Chief Executive Officer,
                               Secretary and General Counsel, Director



September 10, 1999                /s/ Christopher H. Taylor
                               --------------------------------------------
                               Christopher H. Taylor
                               Chief Financial Officer
                               (Principal Financial Officer)