<PAGE>

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                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

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

                                   FORM 10-Q

(Mark One)

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

   For the quarterly period ended September 30, 2001

                                      OR

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

   For the transition period from     to

                      Commission file number    000-28395

                      INTEREP NATIONAL RADIO SALES, INC.
            (Exact name of registrant as specified in its charter)

<TABLE>
<CAPTION>

<S>                                      <C>
               New York                      13-1865151
    (State or other jurisdiction of       (I.R.S. Employer
     incorporation or organization)      Identification No.)

  100 Park Avenue, New York, New York          10017
(Address of principal executive offices)     (Zip Code)
</TABLE>

                                (212) 916-0700
             (Registrant's telephone number, including area code)

   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 [_]

   The number of shares of the registrant's Common Stock outstanding as of the
close of business on November 12, 2001, was 4,833,206 shares of Class A Common
Stock, and 4,017,564 shares of Class B Common Stock.

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

<PAGE>

                                    PART I
                             FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

                      INTEREP NATIONAL RADIO SALES, INC.

                          CONSOLIDATED BALANCE SHEETS
                    (in thousands except share information)
<TABLE>
<CAPTION>
                                                                              September 30, December 31,
                                                                                  2001          2000
                                                                              ------------- ------------
                                                                               (unaudited)
<S>                                                                           <C>           <C>
                                   ASSETS
Current assets:
   Cash and cash equivalents.................................................   $  7,745      $ 23,681
   Marketable securities.....................................................      2,403         9,965
   Receivables, net of allowance for doubtful accounts of $1,563 and $1,940,
     respectively............................................................     28,445        33,810
   Representation contract buyouts receivable................................      4,689         5,266
   Current portion of deferred representation contract costs.................     39,381        44,240
   Prepaid expenses and other current assets.................................      1,043         1,075
                                                                                --------      --------
       Total current assets..................................................     83,706       118,037
                                                                                --------      --------
Fixed assets, net............................................................      4,353         5,046
Deferred representation contract costs.......................................     65,410        71,532
Representation contract buyouts receivable...................................      7,773         6,718
Investments and other assets.................................................     17,009        20,211
                                                                                --------      --------
       Total assets..........................................................   $178,251      $221,544
                                                                                ========      ========
                    LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
   Accounts payable and accrued expenses.....................................   $  8,329      $ 16,121
   Accrued interest..........................................................      2,475         4,950
   Representation contract buyouts payable...................................     22,829        36,116
   Accrued employee-related liabilities......................................      1,130         6,216
                                                                                --------      --------
       Total current liabilities.............................................     34,763        63,403
                                                                                --------      --------
Long-term debt...............................................................     99,000        99,000
                                                                                --------      --------
Representation contract buyouts payable......................................     28,859        34,119
                                                                                --------      --------
Other noncurrent liabilities.................................................      4,054         4,452
                                                                                --------      --------
Shareholders' equity:
   Class A common stock, $0.01 par value--20,000,000 shares authorized,
     4,820,100 and 4,614,143 shares issued and outstanding at September 30,
     2001 and December 31, 2000, respectively................................         48            46
   Class B common stock, $0.01 par value--10,000,000 shares authorized,
     4,172,870 and 3,901,486 shares issued and outstanding at September 30,
     2001 and December 31, 2000, respectively................................         42            39
Additional paid-in-capital...................................................     37,447        35,888
Accumulated deficit..........................................................    (25,962)      (15,403)
                                                                                --------      --------
       Total shareholders' equity............................................     11,575        20,570
                                                                                --------      --------
       Total liabilities and shareholders' equity............................   $178,251      $221,544
                                                                                ========      ========
</TABLE>

 The accompanying Notes to Unaudited Interim Consolidated Financial Statements
                 are an integral part of these balance sheets.

                                      2

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

                     CONSOLIDATED STATEMENTS OF OPERATIONS
                     (in thousands except per share data)
                                  (unaudited)

<TABLE>
<CAPTION>
                                                 For the Three Months For the Nine Months
                                                 Ended September 30,  Ended September 30,
                                                 -------------------  ------------------
                                                   2001        2000     2001      2000
                                                  -------    -------  --------   -------
<S>                                              <C>         <C>      <C>        <C>
Commission revenues............................. $21,641     $27,186  $ 60,899   $74,180
Contract termination revenue....................     661       1,529    20,970     2,346
                                                  -------    -------  --------   -------
Total revenues..................................  22,302      28,715    81,869    76,526
                                                  -------    -------  --------   -------
Operating expenses:
Selling expenses................................  13,972      17,720    46,057    50,480
General and administrative expenses.............   3,139       3,049     9,561     9,015
Depreciation and amortization expense...........   5,756       6,740    26,078    19,057
                                                  -------    -------  --------   -------
Total operating expenses........................  22,867      27,509    81,696    78,552
                                                  -------    -------  --------   -------
Operating income (loss).........................    (565)      1,206       173    (2,026)
Interest expense, net...........................   2,364       2,245     6,889     6,187
Other expense, net..............................   2,530          --     3,429        --
                                                  -------    -------  --------   -------
Loss before provision (benefit) for income taxes  (5,459)     (1,039)  (10,145)   (8,213)
Provision (benefit) for income taxes............      31        (345)      414    (3,245)
                                                  -------    -------  --------   -------
Net loss........................................ $(5,490)    $  (694) $(10,559)  $(4,968)
                                                  =======    =======  ========   =======
Basic and diluted loss per share................ $ (0.62)    $ (0.08) $  (1.22)  $ (0.52)
</TABLE>



 The accompanying Notes to Unaudited Interim Consolidated Financial Statements
                   are an integral part of these statements.

                                      3

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (in thousands)
                                  (unaudited)
<TABLE>
<CAPTION>
                                                                        For the Nine Months
                                                                        Ended September 30,
                                                                        ------------------
                                                                          2001      2000
                                                                        --------  --------
<S>                                                                     <C>       <C>
Cash flows from operating activities:
Net loss............................................................... $(10,559) $ (4,968)
Adjustments to reconcile loss to net cash used in operating activities:
Depreciation and amortization..........................................   26,078    19,057
Noncash compensation expense...........................................     (509)       --
Equity loss on investment..............................................    1,561        --
Write down of internet investments.....................................    1,940        --
Changes in assets and liabilities:
Receivables............................................................    5,365     4,239
Representation contract buyouts receivable.............................     (478)    4,179
Prepaid expenses and other current assets..............................       32      (385)
Other noncurrent assets................................................   (1,726)   (4,133)
Accounts payable and accrued expenses..................................   (7,792)   (3,394)
Accrued interest.......................................................   (2,475)   (2,500)
Accrued employee-related liabilities...................................   (5,086)   (3,501)
Other noncurrent liabilities...........................................     (398)     (374)
                                                                        --------  --------
Net cash provided by operating activities..............................    5,953     8,220
                                                                        --------  --------

Cash flows from investing activities:
Additions to fixed assets..............................................     (331)     (565)
Increase in other investments..........................................       --    (1,340)
Purchase of marketable securities......................................       --    (9,800)
Redemption of marketable securities....................................    7,562        --
                                                                        --------  --------
Net cash provided by (used in) investing activities....................    7,231   (11,705)
                                                                        --------  --------
Cash flows from financing activities:
Station representation contract payments...............................  (31,193)  (24,953)
Issuance of Class B common stock.......................................    2,073        --
Repayment of Series A Notes............................................       --    (1,000)
Purchase of treasury stock.............................................       --   (10,521)
                                                                        --------  --------
Net cash used in financing activities..................................  (29,120)  (36,474)
                                                                        --------  --------
Net decrease in cash and cash equivalents..............................  (15,936)  (39,959)
Cash and cash equivalents, beginning of period.........................   23,681    66,725
                                                                        --------  --------
Cash and cash equivalents, end of period............................... $  7,745  $ 26,766
                                                                        ========  ========
Supplemental disclosures of cash flow information:
Cash paid during the period for:
   Interest paid....................................................... $  9,900  $ 10,000
   Income taxes paid...................................................      417       216
Non-cash investing and financing activities:
   Station representation contracts acquired........................... $ 12,647  $ 40,396
</TABLE>

 The accompanying Notes to Unaudited Interim Consolidated Financial Statements
                   are an integral part of these statements.

                                      4

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

         NOTES TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
                    (in thousands except share information)

1. Summary of Significant Accounting Policies

  Principles of Consolidation

   The consolidated financial statements include the accounts of Interep
National Radio Sales, Inc. ("Interep"), together with its subsidiaries
(collectively, the "Company"), and have been prepared in accordance with the
rules and regulations of the Securities and Exchange Commission. Accordingly,
certain information and footnote disclosures normally included in financial
statements prepared in accordance with accounting principles generally accepted
in the United States have been condensed or omitted. All significant
intercompany transactions and balances have been eliminated.

   The consolidated financial statements as of September 30, 2001 and 2000 are
unaudited; however, in the opinion of management, such statements include all
adjustments necessary for a fair presentation of the results for the periods
presented. The interim financial statements should be read in conjunction with
the audited financial statements and notes thereto included in the Company's
Consolidated Financial Statements for the year ended December 31, 2000, which
are available upon request of the Company. Due to the seasonal nature of the
Company's business, the results of operations for the interim periods are not
necessarily indicative of the results that might be expected for future interim
periods or for the full year ending December 31, 2001.

  Revenue Recognition

   The Company is a national representation ("rep") firm serving radio
broadcast clients throughout the United States. Commission revenue is derived
from sales of advertising time for radio stations under representation
contracts. Commissions and fees are recognized in the month the advertisement
is broadcast. In connection with its unwired network business, the Company
collects fees for unwired network radio advertising and, after deducting its
commissions, remits the fees to the respective radio stations. In instances
when the Company is not legally obligated to pay a station until the
corresponding receivable is paid, fees payable to stations have been offset
against the related receivable from advertising agencies in the accompanying
consolidated balance sheets. The Company records all commission revenues on a
net basis. Commissions are recognized based on the standard broadcast calendar
that ends on the last Sunday in each reporting period. The broadcast calendars
for the three months ended September 30, 2001 and 2000 had 14 and 13 weeks,
respectively. The broadcast calendars for the nine months ended September 30,
2001 and 2000 had 39 weeks.

  Representation Contract Termination Revenue and Contract Acquisition Costs

   The Company's station representation contracts usually renew automatically
from year to year after their stated initial terms unless either party provides
written notice of termination at least twelve months prior to the next
automatic renewal date. In accordance with industry practice, in lieu of
termination, an arrangement is normally made for the purchase of such contracts
by a successor representative firm. The purchase price paid by the successor
representation firm is generally based upon the historic commission income
projected over the remaining contract period, plus two months.

   Costs of obtaining station representation contracts are deferred and
amortized over the life of the new contract. Such amortization is included in
the accompanying consolidated statements of operations as a component of
depreciation and amortization expense. Amounts which are to be amortized during
the next year are included as current assets in the accompanying consolidated
balance sheets. Income earned from the loss of station representation contracts
(contract termination revenue) is recognized on the effective date of the
buyout agreement.

                                      5

<PAGE>

  Earnings (Loss) Per Share

   Basic earnings (loss) per share for each of the respective periods has been
computed by dividing the net income (loss) by the weighted average number of
common shares outstanding during the period which was 8,825,817 and 8,849,390
for the three months ended September 30, 2001 and 2000, respectively, and
8,620,906 and 9,572,311 for the nine months ended September 30, 2001 and 2000,
respectively. Diluted earnings per share would reflect the potential dilution
that could occur if the outstanding options to purchase common stock were
exercised. For the three and nine months ended September 30, 2001 and 2000, the
exercise of outstanding options would have an antidilutive effect and therefore
have been excluded from the calculation.

  New Accounting Pronouncements

   Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for
Derivative Instruments and Hedging Activities," was issued in June 1998 and was
subsequently amended by SFAS No. 138 issued in June 2000. These statements
require companies to record derivatives on the balance sheet as assets and
liabilities, measured at fair value. Depending on the use of a derivative and
whether it has been designated and qualifies as a hedge, gains or losses
resulting from changes in the value of the derivative would be recognized
currently in earnings or reported as a component of other comprehensive income.
The effective date of SFAS No. 133 was delayed to fiscal years beginning after
June 15, 2000, with earlier adoption encouraged. The Company does not use
derivative instruments and therefore the adoption of these statements did not
have any impact on its financial position or results of operations.

   SFAS No. 142, "Goodwill and Other Intangible Assets," was issued in June
2001. This Statement addresses financial accounting and reporting for acquired
goodwill and other intangible assets and supersedes APB Opinion No. 17,
"Intangible Assets". It addresses how intangible assets that are acquired
individually or with a group of other assets (but not those acquired in a
business combination) should be accounted for in financial statements upon
their acquisition. This Statement also addresses how goodwill and other
intangible assets should be accounted for after they have been initially
recognized in the financial statements. With the adoption of this Statement,
goodwill is no longer subject to amortization over its estimated useful life.
Rather, goodwill will be subject to at least an annual assessment for
impairment by applying a fair-value-based test. Similarly, goodwill associated
with equity method investments is no longer amortized. Equity method goodwill
is not, however, subject to the new impairment rules. Effective January 1,
2002, the Company will cease amortization of its existing goodwill. The Company
is in the process of assessing the impact of adopting the new impairment rules
and may incur an impairment charge in accordance with the adoption of this
Statement.

  Use of Estimates

   The preparation of financial statements in conformity with accounting
principles generally accepted in the United States 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 reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.

2. Segment Reporting

   In 1998, the Company adopted Statement of Financial Accounting Standards No.
131, "Disclosure about Segments of an Enterprise and Related Information." The
Statement requires the Company to report segment financial information
consistent with the presentation made to the Company's management for decision
making purposes. The Company is managed as one segment and all revenues are
derived solely from representation operations and related activities. The
Company's management decisions are based on operating cash flow (defined as
operating income before depreciation, amortization, and management fees),
general and administrative expenses of $9,561 and $9,015 for the nine months
ended September 30, 2001 and 2000, respectively, and operating EBITDA (income
before interest, taxes, depreciation and amortization and excluding contract
termination revenue and noncash compensation charges from option repricing) of
$4,772 and $14,685, respectively.

                                      6

<PAGE>

3. Acquisitions and Investments

   In December 2000, the Company invested $3 million in Cybereps, Inc.
increasing its ownership percentage from 16% to 51%. The Company has recorded
an equity loss on the investment of $1,561 for the nine months ended September
30, 2001. In addition, the Company has recorded amortization expense of $678
for the nine months ended September 30, 2001, representing amortization of the
excess of the cash investment over the underlying equity interest in Cybereps.
This excess is being amortized over a five-year period. The Company has
accounted for this investment using the equity method of accounting, as it is
unable to exercise effective control due to minority shareholders participating
in significant decisions in the ordinary course of business. As of September
30, 2001, the carrying value of the Company's investment in Cybereps was $2.9
million.

   In September 1999, the Company acquired substantially all of the assets of
Morrison and Abraham, Inc., a promotion and marketing consulting service to the
radio broadcasting industry, for approximately $1 million paid upon closing and
a maximum of $3 million to be paid contingent upon certain future performance
measures over the next five years. The performance measures were met for the
years ended December 31, 2000 and 1999 and therefore, the Company has paid an
additional $1.5 million. The acquisition has been accounted for by the purchase
method; accordingly, operating results are included in the accompanying
statement of operations from the date of purchase. The acquired assets include
fixed assets, current assets and rights to certain service agreements. The
excess of cost over the fair market value of the assets acquired is being
amortized over a five-year period.

   The Company has investments in affiliates, which are accounted for using the
cost method of accounting as the Company does not have the ability to exercise
significant influence over operating and financial policies of these
affiliates. The total carrying value of these investments was $2.5 million and
$4.1 million as of September 30, 2001 and December 31, 2000, respectively,
representing a range of ownership from 8% to 16% of the affiliated companies.
During the quarter ended September 30, 2001, the Company recorded an other than
temporary write down of $1.9 million to reflect these investments at their net
realizable value. This amount has been included in Other expense, net on the
accompanying statement of operations.

4. Stock Options

   In April 2000, the Company granted options to purchase 775,300 shares of
Class A common stock at an exercise price of $8.77. In December 2000, the
Company repriced these options to an exercise price of $2.81 which represented
the fair market value on the date of the repricing. In accordance with
generally accepted accounting principles, the Company has adopted variable plan
accounting for these options from the date of the repricing. For the nine
months ended September 30, 2001, the Company has recorded a credit to selling
expenses of $509, reflecting the decrease in share price from $3.50 at December
31, 2000 to $2.85 at September 30, 2001.

5. Shareholders' Equity

   In June 2001, the Company issued 308,641 shares of Class B common stock to
the Interep Stock Growth Plan for net cash proceeds of $1.5 million. The shares
were issued at the current fair market value on the date of issuance. In
September 2001, the Company issued 142,450 shares of Class B common stock to
the Interep Stock Growth Plan for net cash proceeds of $500,000. The shares
were issued at the current fair market value on the date of issuance in each
case.

6. Commitments and Contingencies

   The Company may be involved in various legal actions from time to time
arising in the normal course of business. In the opinion of management, there
are no matters outstanding that would have a material adverse effect on the
consolidated financial position or results of operations of the Company.

                                      7

<PAGE>

   In 2000, certain clients of the Company were served summons and complaints
(on separate matters) for alleged breaches of various national sales
representation agreements. The Company has agreed to indemnify its clients from
and against any loss, liability, cost or expense incurred in the actions.
Management believes the defendants have meritorious factual and legal defenses
to the actions and intends to vigorously defend the claims.

   In December 1999, the Company's representation agreement with Clear Channel
Communications was terminated. In April 2000, the Company filed an action in
the Supreme Court of the State of New York seeking damages arising out of Clear
Channel's alleged breach of contract of its national sales representation
agreement with the Company. As of March 31, 2001, the Company had $6.3 million
of current deferred costs on representation contract purchases and $9.4 million
of current representation contract buyout payables resulting from the purchase
of the Clear Channel representation agreement in 1996. In May 2001, the Company
entered into a settlement agreement with Clear Channel. The settlement
agreement resulted in a cash payment to the Company as well as the forgiveness
of the remaining payables. These amounts are reported as contract termination
revenue in the accompanying statement of operations. In addition, the Company
wrote off the remaining current deferred representation contract costs through
amortization expense.

Item 2. Management's Discussion and Analysis of Financial Conditions and
       Results of Operations

   The following discussion is based upon and should be read in conjunction
with our Consolidated Financial Statements, including the notes thereto,
included elsewhere in this Report.

   Throughout this Quarterly Report, when we refer to "Interep" or "the
Company," we refer collectively to Interep National Radio Sales, Inc. and all
of our subsidiaries unless the context indicates otherwise or as otherwise
noted.

Important Note Regarding Forward Looking Statements

   Some of the statements made in this Quarterly Report are "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements are not statements of historical fact, but instead
represent our belief about future events. In some cases, you can identify
forward-looking statements by terminology such as "may," "will," "should,"
"expects," "plans," "anticipates," "believes," "estimates," "predicts,"
"potential," "continue," or the negative of these terms or other comparable
terminology. These statements are based on many assumptions and involve known
and unknown risks and uncertainties that are inherently uncertain and beyond
our control. These risks and uncertainties may cause our or our industry's
actual results, levels of activity, performance or achievements to be
materially different than any expressed or implied by these forward-looking
statements. Although we believe that the expectations in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of
activity, performance or achievements. You should review the factors noted in
Management's Discussion and Analysis of Financial Condition and Results of
Operation--Certain Factors That May Affect Our Results of Operations for a
discussion of some of the things that could cause actual results to differ from
those expressed in our forward-looking statements.

Overview

   We derive a substantial majority of our revenues from commissions on sales
by us of national spot radio advertising air time for the radio stations we
represent. Generally, advertising agencies or media buying services retained by
advertisers purchase national spot advertising time. We receive commissions
from our client radio stations based on the national spot radio advertising
billings of the station, net of standard advertising agency and media buying
services commissions. We enter into written representation contracts with our
clients, which include negotiated commission rates. Because commissions are
based on the prices paid to radio stations for spots, our revenue base is
regularly and automatically adjusted for inflation.

   Our operating results generally depend on:

  .  changes in advertising expenditures;

                                      8

<PAGE>

  .  increases and decreases in the size of the total national spot radio
     advertising market;

  .  changes in our share of this market;

  .  acquisitions and terminations of representation contracts; and

  .  operating expense levels.

   The effect of these factors on our financial condition and results of
operations varies from period to period.

   A number of factors influence the performance of the national spot radio
advertising market, including, but not limited to, general economic conditions,
consumer attitudes and spending patterns, the amount spent on advertising
generally, the share of total advertising spent on radio and the share of total
radio advertising represented by national spot radio. In this regard, we, like
other media businesses, have been adversely affected by a slowing economy
generally, and the events of September 11, 2001, in particular, which we
believe have contributed to a decrease in the amount spent on advertising.

   Our share of the national spot advertising market changes as a result of
increases and decreases in the amount of national spot advertising broadcast by
our clients. Moreover, our market share increases as we acquire representation
contracts with new client stations and decreases if current client
representation contracts are terminated. Thus, our ability to attract new
clients and to retain existing clients significantly affects our market share.

   The value of representation contracts that have been acquired or terminated
during the last few years has tended to increase due to a number of factors,
including the consolidation of ownership in the radio broadcast industry
following the passage of the Telecommunications Act of 1996. In recent years,
we have increased our representation contract acquisition activity, and we have
devoted a significant amount of our resources to these acquisitions. At the
same time, we have received an increased amount of contract termination
revenue. We base our decisions to acquire a representation contract on the
market share opportunity presented and an analysis of the costs and net
benefits to be derived. We continuously seek opportunities to acquire
additional representation contracts on attractive terms, while maintaining our
current clients. Our ability to acquire and maintain representation contracts
has had, and will continue to have, a significant impact on our revenues and
cash flows.

   We recognize revenues on a contract termination as of the effective date of
the termination. When a contract is terminated, we write off in full the
unamortized portion, if any, of the expense we originally incurred on our
acquisition of the contract. When we enter into a representation contract with
a new client, we amortize the contract acquisition cost in equal monthly
installments over the life of the new contract. As a result, our operating
income is affected, negatively or positively, by the acquisition or loss of
client stations. We are unable to forecast any trends in contract buyout
activity, or in the amount of revenues or expenses that will likely be
associated with buyouts during a particular period. Generally, the amount of
revenue resulting from the buyout of a representation contract depends on the
length of the remaining term of the contract and the revenue generated under
the contract during the 12-month "trailing period" preceding the date of
termination. The amount recognized by us as contract termination revenue in any
period is not, however, indicative of contract termination revenue that may be
realized in any future period. Historically, the level of buyout activity has
varied from period to period. Additionally, the length of the remaining terms,
and the commission revenue generation, of the contracts which are terminated in
any period vary to a considerable extent. Accordingly, while buyout activity
and the size of buyout payments has increased since 1996, their impact on our
revenues and income is expected to be uncertain, due to the variables of
contract length and commission generation.

   During 1999, we entered the Internet advertising business. Revenues and
expenses from this business will be affected by the level of advertising on the
Internet generally, the prices obtained for advertising on the Internet and our
ability to obtain contracts from high-traffic Internet websites and from
Internet advertisers. In December 2000, we merged our Interep Interactive
business with Cybereps, Inc., an Internet advertising and marketing firm
founded in 1996, in which we had a minority interest. See Note 3, "Acquisitions
and Investments," in the Notes to the Unaudited Interim Consolidated Financial
Statements included elsewhere in this Report.

                                      9

<PAGE>

   Our selling and corporate expense levels are dependent on management
decisions regarding operating and staffing levels and on inflation. Selling
expenses represent all costs associated with our marketing, sales and sales
support functions. Corporate expenses include items such as corporate
management, corporate communications, financial services, advertising and
promotion expenses and employee benefit plan contributions.

   Our business normally follows the pattern of advertising expenditures in
general. It is seasonal to the extent that radio advertising spending increases
during the fourth calendar quarter in connection with the Christmas season and
tends to be weaker during the first calendar quarter. Radio advertising also
generally increases during the second and third quarters due to holiday-related
advertising, school vacations and back-to-school sales. Additionally, radio
tends to experience increases in the amount of advertising revenues as a result
of special events such as presidential election campaigns. Furthermore, the
level of advertising revenues of radio stations, and therefore our level of
revenues, is susceptible to prevailing general and local economic conditions
and the corresponding increases or decreases in the budgets of advertisers, as
well as market conditions and trends affecting advertising expenditures in
specific industries.

Results of Operations

  Three Months Ended September 30, 2001 Compared to Three Months Ended
  September 30, 2000

   Commission revenue. Commission revenue for the third quarter of 2001
declined from $27.2 million in the third quarter of 2000 to $21.6 million, or
approximately 20.4%. This $5.5 million decrease was primarily attributable to a
sharp decline in national spot radio advertising on client stations, including
cancellations resulting from the events of September 11, 2001, as well as the
substantial reduction in advertising by Internet companies. These factors more
than offset the fact that the broadcast calendar for the third quarter of 2001
consisted of 14 weeks compared to 13 weeks in the third quarter of 2000.
Additionally, effective in 2001, revenues and expenses relating to our Internet
advertising business were transferred to the operations of Cybereps, Inc., and
are included in "Other expense, net" as a loss in equity investments.

   Contract termination revenue. Contract termination revenue in the third
quarter of 2001 decreased to $0.7 million from $1.5 million in the third
quarter of 2000. This decrease was attributable to fewer contracts being
terminated in the third quarter of 2001 than in the comparable 2000 period.

   Selling expenses. Selling expenses for the third quarter of 2001 decreased
to $14.0 million from $17.7 million in the third quarter of 2000. This decrease
of $3.7 million, or approximately 21.1%, was primarily due to an option
repricing credit and a reduction in performance-based compensation.
Additionally, effective in 2001, revenues and expenses relating to our Internet
advertising business were transferred to the operations of Cybereps, Inc., and
are included in "Other expense, net" as a loss in equity investments.

   General and administrative expenses. General and administrative expenses for
the third quarters of 2001 and 2000 were virtually unchanged.

   Depreciation and amortization expense. Depreciation and amortization expense
in the third quarter of 2001 decreased to $5.8 million, or 14.6%, from $6.7
million in the third quarter of 2000. This decrease was due primarily to the
completion of the amortization of certain representation contracts.

   Operating income (loss). Operating loss was $0.6 million for the third
quarter of 2001, as compared to income of $1.2 million during the third quarter
of 2000, a decline of $1.8 million for the reasons discussed above.

   Interest expense, net. Interest expense, net, increased $0.1 million, or
5.3%, to $2.4 million for the third quarter of 2001 from $2.3 million for the
third quarter of 2000. This increase primarily resulted from a reduction in the
amount of interest earned on our cash reserves, which partially offsets the
interest expense on our Senior Subordinated Notes.

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<PAGE>

   Other expense, net. Other expense, net, primarily consists of our share of
the equity loss incurred by Cybereps, Inc. as well as a $1.9 million writedown
of certain internet investments. See Note 3 to the Notes to the Unaudited
Interim Consolidated Financial Statements included elsewhere in this Report.

   Provision (benefit) for income taxes. The provision for income taxes for the
third quarter of 2001 was less than $0.1 million, compared to a benefit of $0.3
million for the comparable 2000 period. For the third quarter of 2001, the
federal tax benefits resulting from the Company's taxable loss position have
been fully reserved. The provision of less than $0.1 million reflects the
Company's current obligation related to state income taxes.

   Net loss. Our net loss after tax was $5.5 million for the third quarter of
2001, compared to a $0.7 million loss for the third quarter of 2000. The $4.8
million difference was attributable to the factors discussed above.

  Nine Months Ended September 30, 2001 Compared to Nine Months Ended September
  30, 2000

   Commission revenues. Commission revenues for the first nine months of 2001
declined to $60.9 million, or 17.9%, from $74.2 million for the first nine
months of 2000. This $13.3 million decrease was primarily attributable to a
sharp decline in national spot radio advertising on client stations, including
cancellations resulting from the events of September 11, 2001 as well as the
substantial reduction in advertising by Internet companies. The broadcast
calendars for the first nine months of 2001 and 2000 were both 39 weeks.
Additionally, effective in 2001, revenues and expenses relating to our Internet
advertising business were transferred to the operations of Cybereps, Inc., and
are included in "Other expense, net" as a loss in equity investments.

   Contract termination revenue. Contract termination revenue in the first nine
months of 2001 increased to $21.0 million from $2.3 million in the first nine
months of 2000. This increase of approximately $18.6 million was primarily
attributable to the settlement with Clear Channel Communications regarding
contract termination revenue on their previously terminated representation
contracts with us.

   Selling expenses. Selling expenses for the first nine months of 2001
decreased to $46.1 million from $50.5 million in the first nine months of 2000.
This decrease of $4.4 million, or 8.8%, was primarily due to an option
repricing credit and a reduction in performance-based compensation offset by
expenditures for an expanded new selling initiative that began in the second
quarter of 2001. Additionally, effective in 2001, revenues and expenses
relating to our Internet advertising business were transferred to the
operations of Cybereps, Inc., and are included in "Other expense, net" as a
loss in equity investments.

   General and administrative expenses. General and administrative expenses for
the first nine months of 2001 increased by $0.5 million, or 6.1%, to $9.6
million from $9.1 million for the first nine months of 2000. This increase of
6.1% is attributable primarily to litigation expenses incurred in the first
nine months of 2001.

   Depreciation and amortization expense. Depreciation and amortization expense
in the first nine months of 2001 increased by $7.0 million, or 36.8%, to $26.1
million from $19.1 million in the first nine months of 2000. This increase was
primarily due to the write-off of $6.3 million of remaining deferred costs
related to our terminated contract with Clear Channel. See Note 6 to the Notes
to the Unaudited Interim Consolidated Financial Statements included elsewhere
in this Report.

   Operating income (loss). Operating income was $0.2 million for the first
nine months of 2001, as compared to a loss of $2.0 million for the first nine
months of 2000, an improvement of $2.2 million for the reasons discussed above.

   Interest expense, net. Interest expense, net, for the first nine months of
2001 increased by $0.7 million, or 11.4%, to $6.9 million from $6.2 million for
the first nine months of 2000. This increase primarily resulted from a
reduction in the amount of interest earned on our cash reserves, which
partially offsets the interest expense on our Senior Subordinated Notes.

                                      11

<PAGE>

   Other expense, net. Other expense, net, primarily consists of our share of
the equity loss incurred by Cybereps, Inc., as well as a $1.9 million writedown
of certain internet investments. See Note 3 to the Notes to the Unaudited
Interim Consolidated Financial Statements included elsewhere in this Report.

   Provision (benefit) for income taxes. The provision for income taxes for the
first nine months of 2001 was $0.4 million, compared to a benefit of $3.2
million for the comparable 2000 period. For the first nine months of 2001,
federal tax benefits resulting from the Company's taxable loss position have
been fully reserved. The provision of $0.4 million reflects the Company's
current obligation related to state income taxes.

   Net loss. Our net loss after tax was $10.6 million for the first nine months
of 2001, compared to a $5.0 million loss for the first nine months of 2000. The
$5.6 million, or 113%, increase was attributable to the reasons discussed above.

Liquidity and Capital Resources

   Our cash requirements have been primarily funded by cash provided from
operations and financing transactions. At September 30, 2001, we had cash and
cash equivalents of $7.7 million, marketable securities of $2.4 million and
working capital of $48.9 million.

   Cash provided by operating activities during the first nine months of 2001
was $6.0 million, as compared to $8.2 million during the first nine months of
2000. This fluctuation was primarily attributable to the decline in revenue.

   Net cash provided by (used in) investing activities is attributable to the
purchase and sale of marketable securities, capital expenditures and
investments in private companies. Net cash provided by investing activities was
$7.2 million during the first nine months of 2001, reflecting $7.5 million from
the redemption of marketable securities, offset by $0.3 million of capital
expenditures.

   Net cash used for financing activities of $29.1 million during the first
nine months of 2001 consisted of $31.2 million used for acquisitions of
representation contracts, offset by $2.1 million in proceeds from the issuance
of common stock to our employees' Stock Growth Plan.

   In general, as we acquire new representation contracts, we use more cash
and, as our contracts are terminated, we receive additional cash. For the
reasons noted above in "Overview," we are not able to predict the amount of
cash we will require for contract acquisitions, or the cash we will receive on
contract terminations, from period to period.

   In July 1998 we issued 10% Senior Subordinated Notes in the aggregate
principal amount of $100.0 million due July 1, 2008. Interest on the Senior
Subordinated Notes is payable in semi-annual payments of $5.0 million. The
Senior Subordinated Notes, while guaranteed by our subsidiaries, are unsecured
and are junior in right of payment to any amounts outstanding under the
revolving credit agreement described below, as well as to certain other
indebtedness. We used a portion of the net proceeds from the issuance of the
Senior Subordinated Notes to repay the then outstanding balance of our bank
debt. Additionally, we redeemed all of the outstanding shares of our then
outstanding Series A preferred stock and Series B preferred stock, together
with all of the associated shares of common stock then subject to redemption.

   We issued the Senior Subordinated Notes under an indenture that limits our
ability to engage in various activities. Among other things: we are generally
not able to pay any dividends to our shareholders, other than dividends payable
in shares of common stock; we can only incur additional indebtedness under
limited circumstances; and certain types of mergers, asset sales and changes of
control either are not permitted or permit the note holders to demand immediate
redemption of their Senior Subordinated Notes.

   The Senior Subordinated Notes may not be redeemed by us prior to July 1,
2003, except that we may redeem up to 30% of the Senior Subordinated Notes with
the proceeds of equity offerings. If certain events occurred which would be
deemed to involve a change of control under the indenture, we would be required
to offer to repurchase all of the Senior Subordinated Notes at a price equal to
101% of their aggregate principal, plus unpaid interest.

                                      12

<PAGE>

   We believe that the liquidity resulting from our initial public offering and
the transactions described above, together with anticipated cash from
continuing operations, should be sufficient to fund our operations and
anticipated needs for required representation contract acquisition payments,
and to make the required 10% annual interest payments on our Senior
Subordinated Notes, for at least the next 12 months. We may not, however,
generate sufficient cash flow for these purposes or to repay the notes at
maturity.

   Our ability to fund our operations and required contract acquisition
payments and to make scheduled principal and interest payments will depend on
our future performance, which, to a certain extent, is subject to general
economic, financial, competitive, legislative, regulatory and other factors
that are beyond our control. We may also need to refinance all or a portion of
our Senior Subordinated Notes on or prior to maturity. There can be no
assurance that we will be able to effect any such refinancing on commercially
reasonable terms, if at all.

  Certain Factors That May Affect Our Results of Operations

   The following factors are some, but not all, of the variables that may have
an impact on our results of operations:

  .  Changes in the ownership of our radio station clients, in the demand for
     radio advertising, in our expenses, in the types of services offered by
     our competitors, and in general economic factors may adversely affect our
     ability to generate the same levels of revenue and operating results.

  .  Advertising tends to be seasonal in nature as advertisers typically spend
     less on radio advertising during the first calendar quarter.

  .  The terrorist attacks that occurred in New York City and Washington, D.C.
     on September 11, 2001, and the subsequent military actions taken by the
     United States and its allies in response, have caused significant
     uncertainty. While the short and long term consequences of these events
     are uncertain, they could have a material adverse effect on general
     economic conditions, consumer confidence, advertising and the media
     industry.

  .  The termination of a representation contract will increase our results of
     operations for the fiscal quarter in which the termination occurs due to
     the termination payments that are usually required to be paid, but will
     negatively affect our results in later quarters due to the loss of
     commission revenues. Hence, our results of operations on a quarterly basis
     are not predictable and are subject to significant fluctuations.

  .  We depend heavily on our key personnel, including our Chief Executive
     Officer Ralph C. Guild and the President of our Marketing Division Marc
     Guild, and our inability to retain them could adversely affect our
     business.

  .  We rely on a limited number of clients for a significant portion of our
     revenues.

  .  Our significant indebtedness from our Senior Subordinated Notes may burden
     our operations, which could make us more vulnerable to general adverse
     economic and industry conditions, make it more difficult to obtain
     additional financing when needed, reduce our cash flow from operations to
     make payments of principal and interest and make it more difficult to
     react to changes in our business and industry.

  .  We may need additional financing for our future capital needs, which may
     not be available on favorable terms, if at all.

  .  Competition could harm our business. Our only significant competitor is
     Katz Media Corporation, which is a subsidiary of a major radio station
     group that has significantly greater financial and other resources than do
     we. In addition, radio must compete for a share of advertisers' total
     advertising budgets with other advertising media such as television,
     cable, print, outdoor advertising and the Internet.

  .  Acquisitions and strategic investments could adversely affect our business.

  .  Our Internet business may suffer if the market for Internet advertising
     fails to develop or continues to weaken.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

   We are exposed to market risk from changes in interest rates that may
adversely affect our results of operations and financial condition. We seek to
minimize the risks from these interest rate fluctuations through our regular
operating and financing activities. Our policy is not to use financial
instruments for trading or other speculative purposes. We are not currently a
party to any financial instruments.

                                      13

<PAGE>

                                    PART II

                               OTHER INFORMATION

Item 1. Legal Proceedings

   None.

Item 2. Changes in Securities and Use of Proceeds

   In September 2001, we issued 142,450 shares of our Class B common stock to
our Stock Growth Plan and Trust at a price of $3.51 per share for net cash
proceeds of $500,000. The purchase price per share represented the average
closing sales price of our Class A common stock on the Nasdaq National Market
for the 20-day trading period ending immediately prior to the date the shares
were issued. We believe the issuance of these shares is exempt pursuant to
Section 4(2) of the Securities Act of 1933.

Item 3. Defaults Upon Senior Securities

   None.

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

   We held our annual meeting of shareholders on August 16, 2001, for the
purpose of electing two directors to our Board of Directors for a term of three
years and ratifying the appointment of Arthur Anderesen LLP as our independent
auditors for the 2001 fiscal year. Leslie D. Goldberg and John E. Palmer were
elected to serve on the Board of Directors until our annual meeting of
shareholders in 2004; Ralph C. Guild, Marc G. Guild and Howard M. Brenner are
still serving their existing terms as directors.

   Messrs. Goldberg and Palmer were elected as directors by a vote of
37,516,787 votes in favor of their election and 101,325 votes against. The
votes cast in favor of Messrs. Goldberg and Palmer represented 99.7% of the
total number of votes cast.

   The proposal to ratify the appointment of Arthur Andersen LLP as our
independent auditors for the 2001 fiscal year was approved by a vote of
37,615,262 votes in favor of the proposal, 800 votes against and 2,050
abstentions. The votes cast in favor of the proposal represented 99.9% of the
total number of votes cast.

Item 5. Other Information

   None.

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

  (A) Documents Filed as Part of this Report

   None.

  (B) Reports on Form 8-K

   None.

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                                  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 in the City of New York, State of New
York.

                                          INTEREP NATIONAL RADIO SALES, INC.

                                          By:   /S/ WILLIAM J. MCENTEE, JR.
                                             -----------------------------------
                                                 William J. McEntee, Jr.
                                          Vice President and Chief Financial
                                                         Officer

November 14, 2001

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