SECURITIES AND EXCHANGE COMMISSION
            WASHINGTON, DC 20549

                FORM 10-QSB

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
      SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended May 31, 2001

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
      SECURITIES EXCHANGE ACT OF 1934

For the transition period from            to


       Commission file number 0-17741


                EPOLIN, INC.
(Exact name of Small Business Issuer as Specified in its Charter)


New Jersey                          22-2547226
(State or Other Jurisdiction  (I.R.S. Employer
of Incorporation or             Identification
Organization)                          Number)

            358-364 Adams Street
          Newark, New Jersey 07105
  (Address of Principal Executive Offices)

               (973) 465-9495
(Issuer's Telephone Number, Including Area Code)

Check whether the Issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Exchange Act during the
past 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

State the number of shares outstanding of each of the Issuer's
classes of common equity, as of the latest practicable date:

 Common, no par value per share: 11,561,855
       outstanding as of May 31, 2001

<PAGE>

      PART I - FINANCIAL INFORMATION

        EPOLIN, INC. AND SUBSIDIARY


       Index to Financial Information
         Period Ended May 31, 2001



     Item
               Page Herein

Item 1 - Financial Statements:

Accountant's Review Report              3

Consolidated Financial Statements:

Consolidated Balance Sheets             4-5

Consolidated Statements of Income       6

Consolidated Statements
of Stockholders' Equity                 7

Consolidated Statements of Cash Flows   8-9

Notes to Consolidated
Financial Statements                    10-18

Item 2 - Management's Discussion and
      Analysis or Plan of Operation     19-20


<PAGE>



ACCOUNTANT'S REVIEW REPORT


To the Board of Directors
EPOLIN INC. AND SUBSIDIARY
Newark, NJ

We have reviewed the accompanying Consolidated Balance Sheet of
Epolin Inc. and Subsidiary as of May 31, 2001 and the related
Consolidated Statements of Income, Stockholders' Equity and
Cash Flows for the three months then ended in accordance with
Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public
Accountants.  All information included in these financial
statements is the representation of the management of Epolin,
Inc. and Subsidiary.

A review consists principally of inquiries of Company personnel
and analytical procedures applied to financial data.  It is
substantially less in scope than an audit in accordance with
generally accepted auditing standards, the objective of which
is the expression of an opinion regarding the financial
statements taken as a whole.  Accordingly, we do not express
such an opinion.

Based on our review, we are not aware of any material
modifications that should be made to the accompanying May 31,
2001 financial statements in order for them to be in conformity
with generally accepted accounting principles.


                 POLAKOFF WEISMANN LEEN LLC

June 14, 2001


<PAGE>


                           EPOLIN, INC. AND SUBSIDIARY

                           CONSOLIDATED BALANCE SHEETS

                                     ASSETS

                                                                 May 31,
                                                         -----------------------
Current assets:                                             2001         2000
                                                         ----------   ----------
   Cash and cash equivalents                             $1,945,219    1,150,845
   Accounts receivable                                      378,372      257,741
   Inventories                                              587,082      472,590
   Prepaid expenses                                          22,116       25,675
   Employee loans                                                --        3,072
   Deferred tax assets-current portion                        8,379        7,713
                                                         ----------   ----------

      Total current assets                                2,941,168    1,917,636
                                                         ----------   ----------

Plant, property and equipment - at cost:
   Land                                                      81,000       81,000
   Building                                                 369,000      369,000
   Machinery and equipment                                  242,136      215,306
   Furniture and fixtures                                    12,223       11,407
   Leasehold improvements                                   432,037      432,037
                                                         ----------   ----------

      Total                                               1,136,396    1,108,750

Less:  Accumulated depreciation and amortization            678,572      654,005
                                                         ----------   ----------

      Net plant, property and equipment                     457,824      454,745
                                                         ----------   ----------

Other assets:
   Deferred tax assets-non current portion                  224,497      146,539
   Cash value - life insurance policy                       106,051       85,079
                                                         ----------   ----------

      Total other assets                                    330,548      231,618
                                                         ----------   ----------

      Total                                              $3,729,540    2,603,999
                                                         ==========   ==========

                          See accountant's review report.

<PAGE>
                           EPOLIN, INC. AND SUBSIDIARY

                     CONSOLIDATED BALANCE SHEETS (CONTINUED)

                      LIABILITIES AND STOCKHOLDERS' EQUITY

                                                                 May 31,
                                                         -----------------------
                                                            2001         2000
                                                         ----------   ----------
Current liabilities:
  Accounts payable                                       $   31,478       13,818
  Accrued expenses                                          141,906      105,088
  Taxes payable:
    Payroll                                                   1,065           --
    Income                                                  162,390       79,029
                                                         ----------   ----------

    Total current liabilities                               336,839      197,935
                                                         ----------   ----------

Other liabilities:
  Deferred compensation                                     305,420      250,591
  Loans payable-officers                                     10,319       10,319
                                                         ----------   ----------

    Total other liabilities                                 315,739      260,910
                                                         ----------   ----------

         Total liabilities                                  652,578      458,845
                                                         ----------   ----------

Stockholders' equity:
  Preferred stock, $15.513 par value; 940,000
    shares authorized; none issued
  Preferred stock, series A convertible non-cumulative,
    $2.50 par value; redemption price and liquidation
    preference; 60,000 shares authorized;
    5,478 shares issued and redeemed
  Common stock, no par value; 20,000,000 shares
    authorized; 12,179,000 and 11,806,500 shares issued
    and outstanding at 2001 and 2000, respectively        2,242,683    2,226,384
  Paid-in capital                                             6,486        6,486
  Retained earnings (deficit)                               983,109       31,190
                                                         ----------   ----------

         Total                                            3,232,278    2,264,060
  Less: Treasury stock-at cost                              155,316      118,906
                                                         ----------   ----------

    Total stockholders' equity                            3,076,962    2,145,154
                                                         ----------   ----------

         Total                                           $3,729,540    2,603,999
                                                         ==========   ==========

                         See accountant's review report.

<PAGE>
                           EPOLIN, INC. AND SUBSIDIARY

                        CONSOLIDATED STATEMENTS OF INCOME

                    THREE MONTHS ENDED MAY 31, 2001 AND 2000

                                                         2001            2000
                                                     -----------     -----------

Sales                                                $   629,921         497,201
                                                     -----------     -----------

Cost of sales and expenses:
   Cost of sales                                          94,713         175,547
   Selling, general and administrative                   154,485         176,138
                                                     -----------     -----------

      Total                                              249,198         351,685
                                                     -----------     -----------

Operating income                                         380,723         145,516
                                                     -----------     -----------


Other income - interest                                   18,580          15,990
                                                     -----------     -----------

Income before taxes                                      399,303         161,506

Income taxes                                             170,419          49,494
                                                     -----------     -----------

Net income                                           $   228,884         112,012
                                                     ===========     ===========


Per share data:
  Basic earnings per common share                           0.02            0.01
                                                     ===========     ===========

  Fully diluted earnings per common share                   0.02            0.01
                                                     ===========     ===========

   Weighted average number of
     common shares outstanding                        11,454,382      11,378,972
                                                     ===========     ===========


                         See accountant's review report.

<PAGE>

                           EPOLIN, INC. AND SUBSIDIARY

                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

                    THREE MONTHS ENDED MAY 31, 2001 AND 2000
<TABLE>
<CAPTION>

                                                    Additional    Retained
                                         Common      Paid-in-     Earnings      Treasury    Stockholders'
                                         Stock       Capital      Deficit        Costs         Equity
                                       ----------   ----------   ----------    ----------    ----------
<S>                                    <C>               <C>        <C>          <C>          <C>
Balance - March 1, 2000                $2,220,384        6,486      (80,822)     (118,906)    2,027,142

Issue of common stock                       6,000           --           --            --         6,000

Net income                                     --           --      112,012            --       112,012
                                       ----------   ----------   ----------    ----------    ----------

Balance - May 31, 2000                  2,226,384        6,486       31,190      (118,906)    2,145,154


Balance - March 1, 2001                 2,229,658        6,486      754,225      (155,316)    2,835,053

Common stock issued for stock option       13,025           --           --            --        13,025

Net income                                     --           --      228,884            --       228,884
                                       ----------   ----------   ----------    ----------    ----------

Balance - May 31, 2001                 $2,242,683        6,486      983,109      (155,316)    3,076,962
                                       ==========   ==========   ==========    ==========    ==========
</TABLE>

                         See accountant's review report.

<PAGE>
                           EPOLIN, INC. AND SUBSIDIARY

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                    THREE MONTHS ENDED MAY 31, 2001 AND 2000


                                                            2001         2000
                                                         ---------    ---------
Cash flows from operating activities:
   Net income                                            $ 228,884      112,012
   Adjustments to reconcile net income
     to net cash provided by operating
     activities:
       Depreciation and amortization                         5,558        5,068
       Deferred tax expense                                  7,902       (6,700)
       Obligation under deferred compensation
         agreement                                           6,019       21,395
   (Increase) decrease in:
      Accounts receivable                                  (72,089)      31,095
      Inventories                                          (85,490)       2,625
      Employee loans                                            --        1,697
      Prepaid expenses:                                      7,007        5,324
   Increase (decrease) in:
      Accounts payable                                      21,285       (3,512)
      Accrued expenses                                       7,748      (56,996)
      Taxes payable:
            Payroll                                         (2,660)          --
            Income                                         131,690     (143,900)
                                                         ---------    ---------

      Net cash provided (used) by operating activities     255,854      (31,892)
                                                         ---------    ---------

Cash flows from investing activities:
 Increase in cash value - life insurance policy                 --       (4,500)
 Payments for equipment                                    (14,115)      (1,700)
                                                         ---------    ---------

      Net cash used by investing activities                (14,115)      (6,200)
                                                         ---------    ---------

                         See accountant's review report.

<PAGE>
                           EPOLIN, INC. AND SUBSIDIARY

                CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

                    THREE MONTHS ENDED MAY 31, 2001 AND 2000


                                                          2001          2000
                                                       ----------    ----------
Cash flows from financing activities:
  Proceeds from the issuance of capital stock              13,025         6,000
  Purchase of treasury stock                                   --            --
                                                       ----------    ----------

     Net cash provided by financing activities             13,025         6,000
                                                       ----------    ----------

Increase (decrease) in cash                               254,764       (32,092)

Cash and cash equivalents:
  Beginning                                             1,690,455     1,182,937
                                                       ----------    ----------

  Ending                                               $1,945,219     1,150,845
                                                       ==========    ==========

Supplemental information:

  Income taxes paid                                    $      173       200,000
                                                       ==========    ==========

  Interest paid                                        $      266           472
                                                       ==========    ==========

                         See accountant's review report.




<PAGE>

EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MAY 31, 2001


NOTE A - ORGANIZATION AND BASIS OF PRESENTATION:

The Company is engaged in the development, production and sale
of near infrared dyes to the optical industry for laser
protection and welding applications and other dyes and
specialty chemical products that serve as intermediates and
additives used in the adhesive, plastic, aerospace,
pharmaceutical and flavors and fragrance industries to
customers located in the United States and throughout the
world.

The Company's wholly owned Subsidiary, Epolin Holding, Corp.,
was incorporated in New Jersey as a real estate holding company
whose asset consist of land and a building.  Prior to being
acquired on January 29, 1998, it was controlled by two
officers/stockholders of the Company.

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Principles of Consolidation - The accompanying Consolidated
Financial Statements include the accounts of the Company and
its Subsidiary.  Intercompany transactions and balances have
been eliminated in consolidation.  Condensed consolidating
financial statements for the three months ended May 31, 2001
follows:

CONDENSED CONSOLIDATING BALANCE SHEET

                                   Epolin
                       Epolin      Holding  Eliminations Consolidated
Current assets      $2,920,748     29,672     (9,252)   2,941,168
Non-current assets     671,960    406,563   (290,151)     788,372
Total               $3,592,708    436,235   (299,403)   3,729,540

Total liabilities     $515,746    170,519    (33,687)     652,578

Stockholders' equity:
    Common stock     2,242,683         -          -     2,242,683
    Additional
    paid-in capital      6,486         -          -         6,486
    Retained earnings  983,109    265,716   (265,716)     983,109
     Treasury stock  (155,316)         -          -      (155,316)

     Total stockholders'
        equity      3,076,962     265,716   (265,716)   3,076,962

          Total    $3,592,708     436,235   (299,403)   3,729,540


<PAGE>


EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MAY 31, 2001


NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (Continued)

CONDENSED CONSOLIDATING STATEMENT OF INCOME

                                  Epolin
                         Epolin   Holding Eliminations Consolidated
Sales                  $629,921      -         -      629,921

Other revenue                -    24,435  (24,435)         -
Total                   629,921   24,435  (24,435)    629,921

Cost of sales            94,713       -        -       94,713
Selling, general
  and administrative    176,288    2,632  (24,435)    154,485
     Total              271,001    2,632  (24,435)    249,198

Operating income        358,920   21,803       -      380,723

Other income - interest  18,580       -        -       18,580

Income before taxes     377,500    21,803      -      399,303

Income taxes            168,394     2,025      -      170,419

Net income             $209,106    19,778      -      228,884


Cash and Cash Equivalents - Includes cash in bank and money
market accounts for purposes of preparing the Statement of Cash
Flows.

Concentrations of Credit Risks - The Company has cash deposits
in financial institutions and brokerage houses in excess of the
amount insured by agencies of the federal government in the
amounts of $1,815,547 and $1,097,000 at May 31, 2001 and 2000,
respectively.  In evaluating this credit risk, the Company
periodically evaluates the stability of these financial
institutions.

Inventories - Consists of raw materials, work in process,
finished goods and supplies valued at the lower of cost or
market under the first-in, first-out method.

Fair Value of Financial Instruments - All reported assets and
liabilities, which represent financial instruments, approximate
the carrying values of such amounts.


<PAGE>


EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MAY 31, 2001



NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
(Continued)

Plant, Property and Equipment - Stated at cost less accumulated
depreciation and amortization. Provisions for depreciation are
computed on the straight-line and declining balance methods,
based upon the estimated useful lives of the assets.

Depreciation and amortization expense totaled $5,558 and $5,068
for the three months ended May 31, 2001 and 2000 respectively.

Income taxes -The Company accounts for income taxes under
Statement of Financial Accounting Standards No. 109,
"Accounting for Income Taxes", wherein the asset and liability
method is used in accounting for income taxes.  Deferred taxes
are recognized for temporary differences between the basis of
assets and liabilities for financial statement and income tax
purposes.  The temporary differences relate primarily to
different accounting methods used for depreciation and
amortization of property and equipment, allowance for doubtful
accounts and net operating loss carry forwards.

Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles
requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of
the financial statements and the amounts of sales and expenses
during the reporting period.  Actual results could differ from
those estimates.

NOTE C - ECONOMIC DEPENDENCY:

A material portion of the Company's business is dependent on
certain domestic customers, the loss of which could have a
material effect on operations.  During the three months ended
May 31, 2001, approximately 51.8% of sales were to four
customers.   Three of these customers, located in the Eastern
United States, account for 43.6% of sales at May 31, 2001.
During the three months ended May 31, 2000, approximately 64.0%
of sales were to four customers. Three of these customers
located in the Eastern United States comprised 46.8% of sales
at May 31, 2000.

<PAGE>


EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MAY 31, 2001


NOTE D - INVENTORIES:

                                2001     2000
Raw materials and supplies    $43,774   47,819
Work in process               191,728   12,045
Finished goods                351,580  412,726

     Total                   $587,082  472,590

NOTE E - INCOME TAXES:
                                         2001      2000

1.  Federal and State deferred tax assets include
       the following:

Temporary differences - principally
accelerated amortization of leasehold
improvements for book purposes and
deferred compensation                  $232,876   154,252

Current portion                           8,379     7,713

Non-current portion                    $224,497   146,539

2.  Income tax expense (benefit) consists of the following
components:

                                  2001          2000
Current
Federal                         $125,827       43,300
State                             36,690       12,894

     Total current               162,517       56,194

Deferred:
Federal                            6,249       (6,000)
State                              1,653         (700)

        Total deferred             7,902       (6,700)

               Total            $170,419       49,494

<PAGE>






EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MAY 31, 2001

NOTE F - ACCRUED SALARIES:


On April 25, 1995, the Board of Directors authorized the
issuance of 1,000,000 shares of common stock (market value $.04
per share) to an officer in lieu of $40,000 of his remaining
accrued salary of $89,948.  The remaining unpaid balance of
$49,948 was paid during the period ended February 28, 2001.

NOTE G - EMPLOYEE BENEFITS:

Simplified Employee Pension Plan - Effective June 1, 1994,
covering all eligible participating employees as defined.
Employer contributions totaled $4,531, and $5,396 for the three
months ended May 31, 2001 and 2000, respectfully.

Incentive Compensation Plan - On December 1989, the Company
approved the 1989 Incentive Compensation Plan for the purpose
of attracting and retaining key personnel.  All employees of
the Company are eligible to participate in the plan whereby
incentive bonuses are determined by the Board of Directors and
payable in shares of common stock.  Shares issued are
determined at fifty percent of the closing bid price, vested,
and delivered over a three-year period.   During the year ended
February 28, 1999, 20,000 shares of common stock were issued
covering a previously awarded bonus to an employee on May 18,
1998.


<PAGE>



EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MAY 31, 2001


NOTE G - EMPLOYEE BENEFITS (continued):

Employee Option Plan - The Company previously adopted The 1986
Stock Option Plan.  As of April 1996, options may no longer be
granted.  Under the terms of the Plan, options granted could be
designated as portions which qualify for incentive stock option
treatment under Section 422A of the Internal Revenue Code of
1986, as amended, or options which do not qualify. On December
1, 1995, options to acquire up to 490,000 shares of the
Company's common stock were granted and expire on December 1,
2005.  In the current quarter, 185,000 shares of common stock
were issued to three employees. Common stock issued for all
prior years totaled 270,000 shares. Options totaling 35,000
expired for all prior years. There are no outstanding options
as of May 31, 2001.


The Company adopted the 1998 Stock Option Plan on December 1,
1998.  Under the terms of the plan, the company reserved
750,000 shares of common stock for issuance pursuant to the
exercise of options to be granted under the Plan, which do not
meet the requirements of Section 422 of the Code.  Options
expire ten years after the date granted and are subject to a
vesting period as follows: (1) no portion will be exercisable
prior to the first anniversary of the date of grant, and (2)
each of the options will become exercisable as to 50% of the
shares underlying the option on each of the first and second
anniversaries of the date granted at $0.15 per share. Options
exercised for all prior years were 12,500. Options exercised in
the current quarter were 37,500.

     Options granted as of May 31, 2001:

No. of
Shares      Date Granted            Expiration Date

425,000   December 1, 1998         November 30, 2008
 25,000   February 10, 1999        February 9, 2009
 25,000   February 10, 2000        February 9, 2010

There are 275,000 options attributable to future grants.


<PAGE>




EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MAY 31, 2001


NOTE H - TREASURY STOCK:

      Treasury stock at May 31, 2001 totaled 617,145 shares,
at a cumulative cost of $155,316. Included are 42,445 shares,
which were returned to the Company at no cost in prior years.

NOTE I - RESEARCH AND DEVELOPMENT:

Included in selling, general and administrative expenses
totaling $54,225, $54,931 for the three months ended May 31,
2001 and 2000  respectively.

NOTE J - ACQUISITIONS:

On January 29, 1998, the Company acquired 100 shares (100%
interest) of Epolin Holding Corp.'s common stock.

NOTE K - COMMITMENTS:

On October 17, 1996, the premises leased from 350 South Street
Partnership was purchased for $450,000 by Epolin Holding Corp.,
a New Jersey Corporation, controlled by Murray S. Cohen, Ph.D.
and James A. Ivchenko, officers/stockholders of Epolin, Inc.
This transaction was approved by the Board of Directors in June
1996 based upon the terms of a $350,000 mortgage obtained from
the Broad National Bank wherein personal guarantees of two
officers/stockholders were mandatory.  Other directors declined
participation in this transaction.

The down payment of $100,000 was obtained from The Company,
evidenced by a five (5) year promissory note of $75,565 (net of
a three (3) months security deposits amounting to $24,435). The
note is payable for a term of five years in monthly payments of
$1,541, including interest at an annual rate of 8.25%.

The lease, is for a term of five (5) years, expiring October
31, 2001, with three (3) five (5) year options at annual
rentals of $97,740 subject to a Cost of Living Index adjustment
effective with the second year.  Rent includes reimbursed
insurance.




<PAGE>




EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MAY 31, 2001

NOTE K - COMMITMENTS (continued):

The minimum annual rental balance under the current lease
expiring October 31, 2001 amounts to $65,160 for the year
ending February 28, 2002.

          Years Ended              Amounts
          February 28, 2002        65,160

Management anticipates renewing the lease at terms yet to be
determined.

Rental expense charged to operations, eliminated in
consolidation, amounted to $24,435 for the three months ended
May 31, 2001 and 2000, respectively.

Deferred Compensation - On December 29, 1995, the Company
entered into a deferred compensation agreement with an officer.
The officer's additional annual compensation of $19,645 plus
interest is being deferred until such time he reaches age 65 or
is terminated.  The obligation is being funded by a life
insurance policy.  Annual payments of $32,000 for ten
consecutive years shall commence the first day of the month
following the officer's 65th birthday or termination.  On
January 1, 1996 the company entered into a deferred
compensation agreement with a second officer wherein $25,000
per year was accrued. This agreement, terminated on June 25,
1998, with unfunded accruals of $79,041 will be paid upon
retirement either in equal consecutive monthly payments for a
period not exceeding sixty (60) months or a single payment
equal to the then present value of the account, said selection
to be at the discretion of the company. The company entered
into a second deferred compensation agreement with the same
officer on June 25, 1998 which provided for the payment of
certain funds for a period of ten years beginning two weeks
after the date of his retirement. This agreement was terminated
March 1, 1999.

Effective March 1, 1999, the company adopted deferred
compensation agreement with two of its employees.  Under the
term of the agreement, each employee will receive one twenty
sixth (1/26) of fifty percent (50%) of their annual salary
(excluding bonuses) as of the date of retirement.  Each has a
death vesting schedule.  Management has elected not to provide
any additional funding for either employee subsequent to the
date at which each of the two employees were no longer employed
with the company.

Deferred compensation of $6,020, and $21,840 was charged to
operations for the three months ended May 31, 2001 and 2000,
respectively.

<PAGE>

EPOLIN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MAY 31, 2001


NOTE K - COMMITMENTS (continued):

Employment Agreements - Effective March 1, 1999, the Company
entered into ten-year employment agreements with executive
officers/directors:

James Ivchenko, President - To be paid an annual salary of not
less than the greater of his annual base salary in effect
immediately prior to the effective date of the agreement or any
subsequently established annual base salary.  In addition, he
is to receive 1.5% of gross annual sales of no more than
$3,000,000, effective with the year ended February 29, 2000,
increasing by 0.25% a year during the term of the agreement.

Murray S. Cohen, PhD, Chairman of the Board and Chief Executive
Officer - To be paid an annual salary of not less than the
greater of his annual base salary in effect immediately prior
to the effective date of the agreement or any subsequently
established annual base salary.  He is to receive 2.00% of
gross annual sales of no more than $3,000,000, effective with
the year ended February 29, 2000, increasing by 0.25% a year
during the term of the agreement.


Contingencies:

In August 2000, the Company received a letter from a law firm
representing a former officer of the Company (who is also a
current director) alleging age discrimination and other
monetary claims pertaining to such former officer's past
employment.  In addition, September 2000, the Company received
a letter from the same law firm on behalf of another former
employee of the Company (who is also a current director)
alleging similar claims.  In December 2000, these individuals
instituted suit in the Superior Court of New Jersey, Bergen
County - Law Division, against the Company and other directors
of the Company alleging claims pursuant to their past
employment as well as a derivative claim, as minority
stockholders.  The Company believes such claims are without
merit and intends to defend such matter vigorously.
Nevertheless, while the outcome of this action cannot be
predicted at this time, taking into account the uncertainty and
risks inherent in any litigation, management does not
anticipate that the ultimate disposition will have a material
adverse effect on the Company.


NOTE L - SUBSEQUENT EVENT:

The Board of directors has declared a $.03 per share cash
dividend for shareholders of record as of June 15, 2001, to be
paid on June 29, 2001.

<PAGE>


Item 2. Management's Discussion and Analysis or Plan of
        Operation.

     The following discussion should be read in conjunction
with the Financial Statements  included in this report and is
qualified in its entirety by the foregoing.

Introduction

     Epolin, Inc. (the "Company") is a manufacturing and
research and development company which was incorporated in the
State of New Jersey in May 1984.  The Company is principally
engaged in the development, production and sale of near
infrared dyes to the optical industry for laser protection and
for welding applications and other dyes, specialty chemical
products that serve as intermediates and additives used in the
adhesive, plastic, aerospace, pharmaceutical, flavors and
fragrance industries to a group of customers located in the
United States and throughout the world.

     This discussion contains certain forward-looking
statements and information relating to the Company that are
based on the beliefs and assumptions by the Company's
management as well as information currently available to the
management.  When used herein, the words "anticipate",
"believe", "estimate", and "expect" and similar expressions,
are intended to identify forward-looking statements.  Such
statements reflect the current views of the Company with
respect to future events and are subject to certain risks,
uncertainties and assumptions.  Should one or more of these
risks or uncertainties materialize or should underlying
assumptions prove incorrect, actual results may vary materially
from those described herein as anticipated, believed, estimated
or expected.  The Company does not intend to update these
forward-looking statements.

Results of Operations

     During the quarter ended May 31, 2001, the Company
reported sales of approximately $629,900 as compared to sales
of approximately $497,200 during the quarter ended May 31,
2000, an increase of approximately $132,700 or 26.7%.  This
increase in sales was primarily attributable to an increase in
sales of the Company's near infrared absorbing dyes and
increases in sales of new dyes for new applications.

     Operating income for the quarter ended May 31, 2001
increased to approximately $380,700 from operating income of
approximately $145,500 for the quarter ended May 31, 2000, an
increase of approximately $235,200.  This change resulted
primarily from an increase in sales for the three months ended
May 31, 2001 compared to the comparable period of the prior
fiscal year as well as a decrease in cost of sales and
decreases in selling, general and administrative expenses for
the three months ended May 31, 2001 as compared to the three
months ended May 31, 2000.  Cost of sales for the three months
ended May 31, 2001 was approximately $94,700 as compared to
cost of sales during the three months ended May 31, 2000 of
approximately $175,500.

     During the three months ended May 31, 2001, the
Company's selling, general and administrative expenses were
approximately $154,500 as compared to selling, general and
administrative expenses of approximately $176,100 for the three
months ended May 31, 2000.

     During the three months ended May 31, 2001, the Company
realized approximately $18,600 in interest income as compared
to approximately $16,000 in interest income for the comparable
period of the prior fiscal year.

     During the quarter ended May 31, 2001, the Company
reported income before taxes of approximately $399,300 as
compared to income before taxes of approximately $161,500 for
the three months ended May 31, 2000.  Net income after taxes
was approximately $228,900 for the three months ended May 31,
2001 as

<PAGE>

compared to income after taxes of approximately $112,000 for
the three months ended May 31, 2000.

Liquidity and Capital Resources

     On May 31, 2001, the Company had working capital of
approximately $2,604,300, an equity to debt ratio of
approximately 4.72 to 1, and stockholders' equity of
approximately $3,077,000.  On May 31, 2001,  the Company had
approximately $1,945,200 in cash and cash equivalents, total
assets of approximately $3,729,500 and total  liabilities of
approximately $652,600.  The Company believes that its
available cash, cash flow from operations and projected
revenues will be sufficient to fund the Company's operations
for more than the next 12 months.

     The Company does not anticipate making any significant
additional capital expenditures in the immediate future as it
believes its present machinery and equipment will be sufficient
to meet its near term needs.

     Inflation has not significantly impacted the Company's
operations.

Other Information

     In March 1998, the Board of Directors of the Company
authorized a stock repurchase program of up to $150,000 of the
Company's outstanding shares of Common Stock.  In connection
therewith, the Company announced that purchases may be made in
the open market or in privately negotiated transactions from
time to time, based on market prices and that the repurchase
program may be suspended without further notice.  Management
believes the Company's shares are undervalued at current price
levels and this program offers the Company a chance not only to
repurchase some of  its stock at prices management perceives to
be attractive but it also enables the Company to enhance
shareholder value although no assurance can be given that any
such repurchases will have such effect.  A total of 574,700
shares have been repurchased under this program through May 31,
2001, at a cumulative cost of $148,641.  No shares were
repurchased during the quarter ended May 31, 2001.

     Subsequent to the fiscal quarter ended May 31, 2001, the
Board of Directors of the Company declared a $0.03 per share
dividend for shareholders of record as of the close of business
on June 15, 2001 to be paid on June 29, 2001.  This represented
the first time that a cash dividend was paid by the Company.

<PAGE>
<PAGE>
        PART II - OTHER INFORMATION


Item 1.        Legal Proceedings.

          In August 2000, the Company received a letter
          from a law firm representing a former officer of
          the Company (who is also a current director)
          alleging age discrimination and other monetary
          claims pertaining to such former officer's past
          employment.  In addition, in September 2000, the
          Company received a letter from the same law firm
          on behalf of another director (who was then an
          employee of the Company) alleging similar
          claims.   In December 2000, these individuals
          instituted suit in the Superior Court of New
          Jersey, Bergen County - Law Division, against
          the Company and the other directors of the
          Company alleging claims pursuant to their past
          employment as well as a derivative claim, as
          minority stockholders.  The Company believes
          such claims are without merit and intends to
          defend such matter vigorously.  Nevertheless,
          while the outcome of this action cannot be
          predicted at this time, taking into account the
          uncertainty and risks inherent in any
          litigation, management does not anticipate that
          the ultimate disposition will have a material
          adverse effect on the Company.

Item 2.        Changes in Securities.

          None.

Item 3.        Defaults Upon Senior Securities.

          None.

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

          None.

Item 5.        Other Information.

          None.

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

          (a)  Exhibits.

               There are no exhibits applicable to this Form
               10-QSB.

           (b)  Reports on Form 8-K.

                Listed below are reports on Form 8-K filed
                during the fiscal quarter ended May 31, 2001.

                None.



<PAGE>
                 SIGNATURES

     In accordance with the requirements of the Exchange Act,
the Registrant caused this Report to be signed on its behalf by
the undersigned thereunto duly authorized.


                              EPOLIN, INC.
                              (Registrant)


Dated: July 11, 2001          By:  /s/ Murray S. Cohen
                                   Murray S. Cohen,
                                   Chief Executive Officer



Dated: July 11, 2001          By:   /s/ Murray S. Cohen
                                    Murray S. Cohen,
                                    Principal Financial
                                    Officer