U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

            Quarterly Report Pursuant to Section 13 or 15 (d) of the
                        Securities Exchange Act of 1934

                      For the quarter ended March 31, 2000

                        Commission File Number 33-6658-C

                                Pioneer Railcorp
             ------------------------------------------------------
             (Exact name of Registrant as specified in its charter)

               Iowa                                               37-1191206
------------------------------------                         -------------------
 (State  or  other  jurisdiction  of                         (IRS Employer ID #)
    incorporation or organization)

     1318 S. Johanson Rd Peoria, IL                                 61607
----------------------------------------                          ----------
(Address of principal executive offices)                          (Zip code)

                   Registrant's telephone number: 309-697-1400

           Securities registered pursuant to Section 12(g) of the Act:

 Title of each Class                   Name of each exchange on which registered
---------------------                  -----------------------------------------
Common Stock, Class A                       NASDAQ, Chicago Stock Exchange


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 [  ].

                                    4,535,377
             ------------------------------------------------------
             (Shares of Common Stock outstanding on March 31, 2000)



<PAGE>


PIONEER RAILCORP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME
Quarters Ended March 31, 2000 and 1999

UNAUDITED

                                                           First Quarter
                                                     ---------------------------
                                                         2000           1999
                                                     ---------------------------

Operating revenue ................................   $ 3,605,722    $ 3,441,978
                                                     ---------------------------

Operating expenses
   Maintenance of way ............................       361,135        336,185
   Maintenance of equipment ......................       332,959        370,850
   Transportation expense ........................       826,291        882,831
   Administrative expense ........................       872,262        818,331
   Depreciation  & amortization ..................       468,652        432,160
                                                     ---------------------------
                                                       2,861,299      2,840,357
                                                     ---------------------------

Operating income .................................       744,423        601,621
                                                     ---------------------------

Other income & expense
   Other (income) expense ........................      (153,979)      (145,554)
   Interest expense, equipment ...................       194,324        164,906
   Interest expense, other .......................       183,113        184,122
   Net (gain) loss on sale of fixed assets .......       (85,486)        (1,880)
                                                     ---------------------------
                                                         137,972        201,594
                                                     ---------------------------

Income before income taxes .......................       606,451        400,027

Provision for income taxes .......................       234,800        152,800
                                                     ---------------------------

Income before minority interest in preferred
   stock dividends of consolidated subsidiaries ..   $   371,651    $   247,227

Minority interest in preferred stock dividends of
    consolidated subsidiaries ....................   $    31,308    $    31,308


Net income .......................................   $   340,343    $   215,919
                                                     ===========================

Basic earnings per common share ..................   $      0.08    $      0.05
                                                     ===========================

Diluted earnings per common share ................   $      0.08    $      0.05
                                                     ===========================

<PAGE>


PIONEER RAILCORP AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
MARCH 31, 2000 and December 31, 1999

UNAUDITED
<TABLE>

                                                            March 31      December 31
                                                              2000           1999
                                                          ----------------------------
<S>                                                       <C>             <C>
ASSETS
Current Assets
   Cash ...............................................   $  1,054,856    $  2,356,844
   Accounts receivable, less allowance
     for doubtful accounts 2000 $162,253; 1999 $186,998      3,897,930       3,940,029
   Inventories ........................................        272,278         272,278
   Prepaid expenses ...................................        108,669          91,377
   Income tax refund claims ...........................         94,449          94,449
   Deferred taxes .....................................         91,800          91,800
                                                          ----------------------------
        Total current assets ..........................      5,519,982       6,846,777
                                                          ----------------------------

Property and Equipment less accumulated
  depreciation 2000 $7,679,010; 1999 $7,242,732 .......     26,260,056      24,159,995
                                                          ----------------------------

Intangible Assets, less accumulated amortization
  2000 $250,350; 1999 $239,846 ........................      1,111,498       1,122,489
                                                          ----------------------------

Investments, cash value of life insurance .............        135,671         131,503
                                                          ----------------------------

Total assets ..........................................   $ 33,027,207    $ 32,260,764
                                                          ============================

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
   Accounts payable ...................................   $  3,025,619    $  3,983,617
   Notes payable ......................................      3,170,000         810,000
   Income taxes payable ...............................        269,047         561,697
   Current maturities of long-term debt ...............      2,422,979       2,390,042
   Accrued liabilities ................................        649,608         670,873
                                                          ----------------------------
        Total current liabilities .....................      9,537,253       8,416,229
                                                          ----------------------------

Long-term debt, net of current maturities .............     12,511,225      13,121,553
Deferred income taxes .................................      4,505,100       4,505,100
                                                          ----------------------------
        Total liabilities & debt ......................     26,553,578      26,042,882
                                                          ----------------------------

Minority interest in subsidiaries .....................      1,138,000       1,154,000

Stockholders' Equity
   Common stock .......................................          4,611           4,611
   In Treasury 2000 75,840 shares; 1999 19,000 shares .            (76)            (19)
                                                          ----------------------------
   Outstanding 2000 4,435,377; 1999 4,592,217 .........          4,535           4,592
   Additional paid-in capital .........................      2,042,042       2,042,042
   Retained earnings ..................................      3,289,052       3,017,248
                                                          ----------------------------
        Total stockholders' equity ....................      5,335,629       5,063,882
                                                          ----------------------------

Total liabilities and equity ..........................   $ 33,027,207    $ 32,260,764
                                                          ============================
</TABLE>
<PAGE>


PIONEER RAILCORP AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS
Quarters Ended March 31, 2000 and 1999

UNAUDITED
<TABLE>

                                                                     First Quarter
                                                               --------------------------
                                                                   2000          1999
                                                               --------------------------
<S>                                                            <C>            <C>
Cash Flows From Operating Activities
Net income .................................................   $   340,343    $   215,919
Adjustments to reconcile net income to net cash
    provided by operating activities:
           Minority interest in preferred stock dividends of
           consolidated subsidiaries .......................        31,308         31,308
           Depreciation ....................................       458,148        408,649
           Amortization ....................................        10,504         23,511
           Increase in cash value life insurance ...........        (4,168)        (2,740)
           (Gain) on sale of property & equipment ..........       (84,586)        (1,880)
           Deferred taxes ..................................           -0-            -0-
Change in assets and liabilities, net of effects from
    acquisition of subsidiaries
           (Increase) decrease accounts receivable ....            137,099       (476,289)
           (Increase) decrease inventories ............                -0-         21,400
           (Increase) decrease prepaid expenses .......            (17,292)        61,384
           (Increase) decrease intangible assets ......                754            635
           Increase (decrease) accounts payable ............      (957,998)       402,603
           (Increase) decrease income tax refund claims                -0-         20,751
           Increase (decrease) income tax payable ..........      (292,650)       118,739
           Increase (decrease) accrued liabilities .........       (21,265)       (42,558)
                                                               --------------------------
           Net cash provided (used in) operating activities       (399,803)       781,432
                                                               --------------------------

Cash Flows From Investing Activities
           Proceeds from sale of property & equipment ......           400          5,000
           Purchase of property & equipment, net of property
             and equipment from acquisition of subsidiaries     (2,569,289)    (2,578,225)
                                                               --------------------------
           Net cash (used in) investing activities .........    (2,568,889)    (2,573,225)
                                                               --------------------------

Cash Flows From Financing Activities
           Proceeds from short-term borrowings, net of debt
             assumed in acquisition of subsidiaries ........     3,640,840        507,000
           Proceeds from long-term borrowings, net of debt
             assumed in acquisition of subsidiaries ........           -0-      2,400,000
           Payments on short-term borrowings ...............    (1,280,840)      (568,612)
           Payments on long-term borrowings ................      (577,391)      (493,170)
           Repurchase of minority interest .................       (16,000)        (3,000)
           Purchase of common stock for treasury ...........       (82,605)
           Proceeds from warrants and options exercised ....           -0-            -0-
           Payments to minority interest ...................       (17,300)       (17,300)
                                                               --------------------------
           Net cash provided by financing activities: ......     1,666,704      1,824,918
                                                               --------------------------

Net increase (decrease) in cash ............................    (1,301,988)        33,125

Cash, beginning of period ..................................     2,356,844        469,476
                                                               --------------------------

Cash, end of period ........................................   $ 1,054,856    $   502,601
                                                               ==========================
</TABLE>
<PAGE>


SEGMENT INFORMATION

Description of products and services from reportable segments:

Pioneer Railcorp has two reportable segments,  railroad operations and equipment
leasing  operations.  All other  operations are classified as corporate  support
services for purposes of this disclosure.

Measurement of segment profit or loss and segment assets:

The accounting  policies of the segments are the same as those  described in the
summary of significant  accounting policies.  Pioneer Railcorp evaluates segment
profit based on operating income  including  intersegment  revenues,  but before
provision  for income  taxes,  items of other income and  expense,  and minority
interest in preferred stock dividends of consolidated subsidiaries.

Intersegment transactions:

Intersegment transactions are recorded at cost.

Factors management used to identify the reportable segments:

Pioneer  Railcorp's  reportable  segments  consist of a wholly-owned  short line
railroad  subsidiaries  that offer  similar  services  and a railroad  equipment
subsidiary that leases railcars,  locomotives,  and other railroad  equipment to
affiliated  and  unaffiliated  entities.  The  corporate  operations  consist of
support services provided to the operating segments.

                                                           First Quarter
                                                      --------------------------
                                                          2000          1999
                                                      --------------------------
Revenues from external customers
   Railroad operations ...........................     2,847,298      2,792,529
   Equipment leasing operations ..................       758,334        649,449
   Corporate support services ....................            90              0
                                                      --------------------------
      Total revenues from external customers .....     3,605,722      3,441,978
                                                      ==========================

Intersegment revenues
   Railroad operations ...........................             0              0
   Equipment leasing operations ..................        95,100        104,100
   Corporate support services ....................     1,511,954      1,277,646
                                                      --------------------------
      Total intersegment revenues ................     1,607,054      1,381,746
                                                      ==========================

Segment profit
   Railroad operations ...........................     1,181,876      1,046,893
   Equipment leasing operations ..................       421,394        355,849
   Corporate support services ....................       748,207        580,625
                                                      --------------------------
      Total segment profit .......................     2,351,477      1,983,367

Reconciling items
    Intersegment revenues ........................    (1,607,054)    (1,381,746)
    Income taxes .................................      (234,800)      (152,800)
    Minority interest ............................       (31,308)       (31,308)
    Other income(expense), net ...................      (137,972)      (201,594)
                                                      --------------------------
       Total consolidated net income .............       340,343        215,919
                                                      ==========================

<PAGE>



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
PIONEER RAILCORP AND SUBSIDIARIES

NOTE 1.   STATEMENTS

The  accompanying   Consolidated  Statements  of  Income,  Balance  Sheets,  and
Statements of Cash Flows are unaudited. The interim financial statements reflect
all adjustments (consisting only of normal recurring accruals) which are, in the
opinion of  management,  necessary  for a fair  statement of the results for the
interim  periods   presented.   These  interim  statements  should  be  read  in
conjunction with the latest  financial  statements and notes thereto included in
the Company's  latest Annual  Report on Form 10-KSB and  subsequent  Form 10-QSB
filings.  The  results  of  operations  for the  interim  period  should  not be
considered indicative of results to be expected for the full year.

NOTE 2.   SIGNIFICANT ACCOUNTING POLICIES

The consolidated financial statements include Pioneer Railcorp (Pioneer) and its
wholly-owned  and controlled  subsidiaries  (collectively,  "the Company").  The
Company's  railroad  operations  segment  consists  of  wholly-owned  short line
railroad  subsidiaries  that offer  similar  services and includes the following
wholly-owned  subsidiaries:  West Michigan Railroad Co. (WMI), Michigan Southern
Railroad  Company  (MSO),  Fort Smith Railroad Co. (FSR),  Alabama  Railroad Co.
(ALAB),  Mississippi Central Railroad Co. (MSCI), Alabama & Florida Railway Co.,
Inc. (AF), Decatur Junction Railway Co. (DT),  Vandalia Railroad Company (VRRC),
Minnesota  Central  Railroad  Co.  (MCTA)  (sold May 6, 1999),  Keokuk  Junction
Railway Co. (KJRY),  Shawnee Terminal Railway Company (STR),  Pioneer Industrial
Railway Co. (PRY), The Garden City Western Railway,  Inc. (GCW), and an inactive
subsidiary  Midwest Terminal Railway Company  (formerly  Rochelle  Railroad Co.)
(RRCO).  The Company's  equipment leasing segment leases railcars,  locomotives,
and other  railroad  equipment  to  affiliated  and  unaffiliated  entities  and
includes only the wholly-owned  subsidiary  Pioneer Railroad Equipment Co., Ltd.
(PREL). All other Company operations are classified as corporate and include the
following wholly-owned subsidiaries: Pioneer Resources, Inc. (PRI), Pioneer Air,
Inc.  (PAR),  and  Pioneer  Railroad  Services,   Inc.  (PRS).  All  significant
intercompany balances and transactions have been eliminated in consolidation.

NOTE 3.  ESTIMATED IMPACT OF THE ADOPTION OF RECENT ACCOUNTING STANDARDS

The Company is not aware of any recent accounting  standard issued,  but not yet
required to be adopted by the Company,  that would have a material effect on its
financial position or results of operations.
<PAGE>



Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
          CONDITION AND RESULTS OF OPERATIONS

This management's  discussion and analysis of financial condition and results of
operations  references  the  Company's  two  operating  segments.  The Company's
railroad  operations  segment  consists  of  wholly-owned  short  line  railroad
subsidiaries  that offer similar  services and the Company's  equipment  leasing
segment leases railcars, locomotives, and other railroad equipment to affiliated
and  unaffiliated  entities.  All other  operations  are classified as corporate
support services for purpose of these discussions.  All information provided for
each  operating  segment is  presented  after  elimination  of all  intersegment
transactions, therefore reflecting its share of consolidated results.

Pioneer Railcorp, an Iowa corporation, is a railroad holding company. As used in
this Form 10-QSB,  unless the context requires otherwise,  the term "Company" or
"PRC" refers to the parent, Pioneer Railcorp and its subsidiaries: West Michigan
Railroad  Co.  (WMI),  Michigan  Southern  Railroad  Company  (MSO),  Fort Smith
Railroad Co. (FSR),  Alabama Railroad Co. (ALAB),  Mississippi  Central Railroad
Co. (MSCI),  Alabama & Florida Railway Co., Inc. (AF),  Decatur Junction Railway
Co. (DT),  Vandalia  Railroad  Company (VRRC),  Minnesota  Central  Railroad Co.
(MCTA) (sold May 6, 1999), Keokuk Junction Railway Co. (KJRY),  Shawnee Terminal
Railway Company (STR),  Pioneer  Industrial  Railway Co. (PRY),  The Garden City
Western Railway,  Inc. (GCW),  Pioneer Resources,  Inc. (PRI),  Pioneer Railroad
Equipment  Co., Ltd.  (PREL),  Pioneer Air,  Inc.  (PAR),  and Pioneer  Railroad
Services, Inc. (PRS) and an inactive subsidiary Midwest Terminal Railway Company
(formerly Rochelle Railroad Co.) (RRCO).

Summary: First Quarter 2000 Compared to First Quarter 1999.

The Company's net income in the first quarter 2000  increased by 58% to $340,000
up $124,000  from  $216,000 in the same period last year.  Revenue  increased by
$164,000  or 5% to  $3,606,000  from  $3,442,000  in the same  period last year.
Operating  expense  increased by $21,000 or 1%, to $2,861,000 from $2,840,000 in
the same period last year.  Operating  income  increased by $142,000,  or 24% to
$744,000 from $602,000 in the same period last year.

Operating  income  was  increased  in the first  quarter  2000 by the  Company's
railroad operations which increased  operating income by approximately  $136,000
in the period.  The equipment leasing operations  increased  operating income by
approximately $75,000 in the period,  primarily from increased revenue generated
from  locomotive  leases and an increase in the utilization of its railcar fleet
by non-affiliated  railroads. In addition,  corporate support services decreased
operating income by approximately $69,000 in the period.

Revenue:

Revenue increased in the first quarter 2000 by approximately $164,000, or 5%, to
$3,606,000 from $3,442,000 in the same period last year. The railroad operations
increased revenue by approximately  $55,000 in the period which resulted from an
increase  in revenues  of  approximately  $347,000  generated  by the  railroads
operated in the first  quarter 2000 less a decrease in revenue of  approximately
$292,000  as a result of the sale of the  Minnesota  Central  Railroad on May 6,
1999. The increase of revenue of $347,000  generated from the railroads operated
in the first  quarter 2000  resulted  from a  combination  of increased  freight
revenue,   increased   revenue  for  the  storage  of  private   railcars   from
non-affiliated entities, and an increase in revenue of $148,000 generated by The
Garden City Western  Railway,  which the Company began operating on May 1, 1999.
The  equipment  leasing  operations  had a $108,000  increase  in revenue in the
period resulting from increased  revenue generated from locomotive leases and an
increase in the utilization of its railcar fleet by non-affiliated railroads.

Operating Expense:

Operating  expense  increased  in the first  quarter  2000 by  $21,000 or 1%, to
$2,861,000 from $2,840,000 in the prior year. The railroad operations  decreased
operating expense by approximately  $80,000 in the period which resulted from an
increase in  operating  expense of  approximately  $211,000  from the  railroads
operated  in the first  quarter  2000 less a decrease  in  operating  expense of
approximately $292,000 as a result of the sale of the Minnesota Central Railroad
on May 6,  1999.  The  increase  in  operating  expenses  of  $211,000  from the
railroads  operated in the first quarter 2000 resulted from a variety of factors
including increased track maintenance,  fuel and other transportation  expenses,
and $95,000 of operating expenses for The Garden City Western Railway, which the
Company  began  operating  on May 1,  1999.  The  equipment  leasing  operations
increased operating expense approximately $34,000, primarily from an increase in
depreciation  expense  related to the  acquisition of railcars and  locomotives.
Corporate support services increased  operating expense  approximately  $67,000,
primarily related to payroll related expenditures.
<PAGE>


Maintenance  of way and  structures  expense  (MOW)  increased  $25,000 or 7% to
$361,000 from $336,000 in the same period last year.  Railroads  operated in the
first  quarter  2000 had an  increase  of $58,000 in MOW,  primarily  related to
increased  track material by the railroad  operations and $22,000 of MOW expense
for The Garden City Western Railway.  In addition,  MOW was decreased by $39,000
as a result of the sale of the MCTA.

Maintenance of equipment  expense (MOE)  decreased  $38,000,  or 10% to $333,000
from  $371,000  in the same  period  last  year.  Approximately  $10,000  of the
decrease  related to the equipment  leasing  operations as a result of decreased
costs  associated  with  maintaining  the  Company's  railcar  fleet.  Railroads
operated in the first  quarter 2000 had a decrease of $11,000 in MOE. The Garden
City Western Railway did not have a significant  amount of MOE in the period. In
addition, MOE was decreased by $22,000 as a result of the sale of the MCTA.

Transportation expense (TRAN) decreased $57,000, or 6% to $826,000 from $883,000
in the same period last year.  Most of the decreased  TRAN expense was generated
by the railroad operations.  Railroads operated in the first quarter 2000 had an
increase of $122,000 in TRAN,  primarily  related to increased  fuel and carhire
expenses,  and also $25,000 of TRAN expense for The Garden City Western Railway.
In addition, TRAN was decreased by $186,000 as a result of the sale of the MCTA.

General & administration  expense (ADMIN) increased $54,000 in the first quarter
2000 to $872,000  from  $818,000 in the prior  year.  Railroads  operated in the
first  quarter  2000 had an increase  of $14,000 in ADMIN  expense in the period
including  $19,000  ADMIN  expense  for The  Garden  City  Western  Railway.  In
addition,  ADMIN was  decreased  by $13,000 as a result of the sale of the MCTA.
Corporate  expenses  related  corporate  support  expenditures  increased  ADMIN
expense by approximately $52,000 in the period.

Depreciation and amortization expense increased $36,000, or 8%, to $469,000 from
$432,000 in the same period last year.  Approximately $28,000 of the increase is
related to The Garden City & Western  Railway.  In  addition,  depreciation  and
amortization  was decreased by $33,000 as a result of the sale of the MCTA.  The
equipment  leasing  operations  increased   depreciation  expense  approximately
$41,000 related to the acquisition of railcars and locomotives.

Other Income and Expense Income Statement Line Item Discussion:

In the first quarter 2000 other income and expense  increased $9,000 to $154,000
compared  to  $145,000  in the same  period  last  year.  The  increase  relates
primarily  to  additional  lease  income for the use of railroad  property.  The
Company  continues  to place a strong  emphasis on  identifying  and  collecting
revenues from third parties  occupying  Company  property.  In addition to lease
income,  other income and expense includes revenues  generated from scrap sales,
and other miscellaneous non-operating revenues and expenses, primarily generated
by the company's railroad operations.

Interest expense related to equipment  financing  increased $29,000 in the first
quarter  2000 to $194,000  compared to $165,000 in the same period last year.  A
majority of this increase is the result of financing activities  associated with
additional  locomotive  purchases made by the Company in the fourth quarter 1999
and first quarter 2000. Other interest expense decreased  insignificantly in the
first quarter 2000 to $183,000 from $184,000 in the prior year.  Other  interest
expense increases  related to the Garden City & Western Railway  acquisition and
other  changes in  interest  expenses  were  offset by a  reduction  of interest
expense of approximately $12,000 related to the sale of the MCTA.

Net gain on fixed  asset  dispositions  increased  approximately  $84,000 in the
first  quarter 2000 to $85,000  compared to $2,000 in the same period last year.
The gain in 2000 primarily relates to the sale of a locomotive.

Impact of New Accounting Pronouncements:

The Company is not aware of any recent accounting  standard issued,  but not yet
required to be adopted by the Company,  that would have a material effect on its
financial position or results of operations.
<PAGE>



Liquidity and Capital Resources:

The Company  primarily  uses cash  generated  from  operations  to fund  working
capital  needs and relies on long-term  financing  for  railcars,  new operating
subsidiaries, and other significant capital expenditures.

The  Company  has  working  capital  facilities  totaling  $1,200,000,  of which
$325,000  was  available  for  use at the  end of the  first  quarter  2000.  In
addition,  the  Company  believes  the  market  value  of its  railcar  fleet is
significantly  higher then the amount of debt associated with the railcar fleet.
Therefore,  the Company  believes it could refinance or sell part of its railcar
fleet and generate up to $1 million in cash.

On June 18, 1999, the Company entered into a credit agreement with National City
Bank of Michigan/Illinois to provide a $5 million revolving  acquisition line of
credit for railroad  acquisitions at a variable  interest rate of prime plus 1%,
renewable every 2 years.  Amounts drawn on the line are amortized over a 10 year
period.  This  credit  line is  secured  by all non real  estate  assets  of the
Mississippi  Central  Railroad  Co.,  the Alabama  Railroad  Co. and any company
acquired using proceeds from the credit line. This credit facility  replaced the
Citizens Bank & Trust credit line.  The Company used $1.5 million of this credit
facility to finance the purchase of The Garden City Western Railway, Inc. common
stock.  The monthly  principal  and interest  payment  currently  required to be
repaid is $18,900.  As of March 31, 2000, the  availability of the line has been
further  reduced by a separate $2.4 million  financing  agreement  with National
City Bank used to purchase 33 locomotives.  The note is due May 10, 2000 and the
Company is in negotiations  with the bank to convert the note to long-term fixed
rate financing.

Long-term  equipment  financing has historically  been readily  available to the
Company for its railcar  acquisition  program.  The Company  believes it will be
able to continue obtaining  long-term equipment financing should the need arise.
The Company's  plans for new debt in the  foreseeable  future is contingent upon
new railroad acquisitions and increased needs and/or opportunities for railcars.

On July 1, 1995, the Company's  stock split and warrant  issuance became payable
to  shareholders.  The 2 for 1 stock split increased the number of shares issued
and  outstanding  from  2,099,142 to  4,198,284.  At the same time  shareholders
became  entitled  to purchase  an  additional  4,198,284  shares  through  stock
warrants  issued by the  Company as  dividends.  One warrant was issued for each
share of common stock held after the split,  entitling  the holder to purchase 1
share of common  stock for $2.00 per share.  The shares  purchased  through  the
exercise of the warrants  must be held for 1 year from date of  purchase.  As of
March 31, 2000, a total of 67,766 warrants originally issued had been exercised,
and the Company realized $135,532 on the issuance of the warrants.

The  Company  granted  836,000  options  to  certain  employees  under  its 1994
incentive  stock option plan. The options are exercisable at prices equal to the
market value of the  Company's  stock at the date of grant.  The exercise  price
ranges from $3.56 to $4.40 per share.  No options were exercised in 1999.  Since
the plans inception a total of 69,700 options had been exercised and the Company
has realized  $104,550 on the  exercise of the options.  As of March 31, 2000, a
total of 151,759 options are outstanding under this plan.

On June 26,  1996,  the  Company's  shareholders  approved a stock  option  plan
permitting the issuance of 407,000 shares of common stock. Options granted under
the plan are  incentive  based  except for the options  granted to the CEO whose
options  are  non-qualified.  The  options  will be  fully  vested  and  will be
exercisable  as of July 1, 2001. The exercise date can be accelerated if Pioneer
Railcorp common shares reach a closing price of $7.25 per share, or higher,  for
any  consecutive  10-day  period,  as reported in the Wall Street  Journal.  The
options will be exercisable  at prices  ranging from $2.75 to $3.03,  based upon
the trading price on the date of the grant,  in whole or in part within 10 years
from the date of grant.  As of March 31,  2000,  a total of 215,000  options are
outstanding under this plan.

Pioneer Railcorp  guarantees certain long-term debt obligations of the Minnesota
Central  Railroad Co. in  connection  with debt  acquired as part of the initial
asset purchase by the Minnesota  Central Railroad Co. in 1994.  Pioneer Railcorp
remains as a guarantor on one note and could be required to repay the  principal
and accrued interest on the note if it is defaulted upon. The principal  balance
of the note as of December 31, 1999 was approximately $75,000.
<PAGE>


In 1999,  Pioneer  Railcorp's  Board of  Directors  authorized  and approved the
repurchase of up to one million  shares  (1,000,0000)  of the  Company's  common
stock and as of March 31, 2000, a total of 75,840 shares had been repurchased at
a cost of $109,083.  The Company plans to continue  buying back its common stock
but believes the  repurchase  will be on a more  limited  scope then  previously
anticipated due to capital  requirements and the trading volume of the Company's
stock.

The Company  anticipates that the outcomes  involving  current legal proceedings
will not  materially  affect the Company's  consolidated  financial  position or
results of operation.

The Company  believes its cash flow from  operations  and its available  working
capital  credit  lines,  will be more than  sufficient to meet  liquidity  needs
through at least the next twelve months.

Balance Sheet and Cash Flow Items:

The Company  operating  activities  in the first  quarter  2000  generated a net
decrease  in cash of $400,000  compared  to the same period last year.  Net cash
from operating activities for the first quarter 2000 was generated from $340,000
of net income, $469,000 of depreciation and amortization, a decrease in accounts
payable of $958,000, a decrease in income tax payable of $293,000 and a net cash
of  $42,000   provided  by  changes  in  various  other  operating   assets  and
liabilities.  The  majority of the decrease in accounts  payable  relates to the
payment of freight revenues to nonaffiliated railroads as part of the industries
"interline  settlement  system".  Under the  interline  settlement  system,  the
Company's  operating  railroads  primarily bill and collect the complete freight
rate which would include the amounts due other railroads who are in the delivery
route.

In the first quarter 2000,  the Company  purchased  approximately  $2,569,000 of
fixed  assets and  capital  improvements.  Capital  expenditures  included  $1.6
million for 22 locomotives.  The Company plans to expand it's locomotive leasing
operations and update it's current fleet.  The locomotives  were financed with a
short  term note with  National  City Bank and  negotiations  are in  process to
convert this note to long term financing. In addition, the company purchased 100
railcars for approximately  $826,000.  This transaction was paid by cash and the
Company is in the process of  negotiating to finance the railcars with long term
fixed rate financing.  Capital expenditures for track and leasehold improvements
totaled  $57,000 in the first  quarter  2000.  The  remaining  fixed  assets and
capital improvements  expenditures of approximately  $86,000 relate to equipment
and railcar betterments.
<PAGE>


PART II.  OTHER INFORMATION

Item 1.   LEGAL PROCEEDINGS

In the course of business, the Company experiences crossing accidents,  employee
injuries,  delinquent and/or disputed accounts, and other incidents,  which give
rise to claims  that may result in  litigation.  Management  vigorously  pursues
settlement and release of such claims, but at any one time, some such incidents,
which could  result in lawsuits by and against the Company,  remain  unresolved.
Management believes it has valid claims for, or good defenses to, these actions.
Management considers such claims to be a routine part of the Company's business.

As of the date of this Form  10-QSB,  management  is not  aware of any  incident
which is likely to  result in a  liability  that  would  materially  affect  the
Company's consolidated financial position or results of operation.

Item 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters  were  submitted to a vote of security  holders in the first  quarter
2000.

Item 5.   OTHER INFORMATION

On April 6, 2000,  Pioneer  Railcorp's  Board of Directors  declared a $.025 per
common share dividend  payable to  shareholders  of record as of April 30, 2000,
payable by June 10, 2000.

On April 1, 2000,  the  Company  through  its  wholly-owned  subsidiary  Indiana
Southwestern  Railway Co.  (ISW)  acquired all of the rail  facilities  owned or
leased  by  the  Evansville   Terminal  Railway  Company  and  began  operations
immediately.  The total  purchase  price was  $619,000  and was funded  with the
Comapny's acquisiton line of credit. The line begins in Evansville,  Indiana and
is 23 miles in length.  The primary  commodities  are grain,  plastics  and rail
equipment.  The Company projects the ISW will initially generate annual revenues
of $300,000 and $50,000 of operating income.

Item 6.   EXHIBITS AND REPORTS ON FORM 8-K

Exhibit # 11 - Statement re  computation of per share  earnings.
Exhibit # 27 - Financial data schedule.

No reports were filed on Form 8-K during the first quarter 2000.
<PAGE>



SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
Registrant  has duly  caused  this  report to be  signed  on it's  behalf by the
undersigned thereunto duly authorized.





PIONEER RAILCORP
(Registrant)




                                       /s/ Guy L. Brenkman
       5/10/00                         -----------------------------------------
        DATE                           GUY L. BRENKMAN
                                        PRESIDENT & CEO



                                       /s/ J. Michael Carr
      5/10/00                          -----------------------------------------
       DATE                            J. MICHAEL CARR
                                        TREASURER & CHIEF FINANCIAL OFFICER