UNITED STATES
                  SECURITIES AND EXCHANGE COMMISSION
                        Washington, DC   20549

                                FORM 10-Q

(Mark One)

XX  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
---  ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 2002

    TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
---  ACT OF 1934 FOR THE TRANSITION PERIOD FROM _______ TO ______.


    Commission file number        000-24991
                             ____________________


                         ALLSTATES WORLDCARGO, INC.
     -------------------------------------------------------------------
     (Exact name of small business issuer as specified in its charter)


          New Jersey                            22-3487471
        --------------                 -------------------------------
  (State or other jurisdiction        (IRS Employer Identification No.)
     of incorporation)


           4 Lakeside Drive South, Forked River, New Jersey, 08731
          ----------------------------------------------------------
                 (Address of principal executive offices)


                             609-693-5950
            --------------------------------------------------
            (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 Exchange Act 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  XX      No
    ----         ----

The Company had 32,509,872 shares of common stock, par value $.0001 per
share, outstanding as of February 12, 2002.

                                     1
<PAGE>



            ALLSTATES WORLDCARGO, INC. AND SUBSIDIARIES


                              INDEX

                                                                       PAGE
PART 1.   FINANCIAL INFORMATION                                        ----

  ITEM 1.   FINANCIAL STATEMENTS

   Financial Statements with Supplemental Information
   For the Period Ending December 31, 2002 and 2001

  Financial Statements:

    Condensed Consolidated Balance Sheet                                 3

    Condensed Consolidated Statement of Operations                       4

    Condensed Consolidated Statements of
        Stockholders' Equity (Deficit)                                   5

    Condensed Consolidated Statement of Cash Flows                       6

  Notes to the Financial Statements                                      7


   ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS....................... 8

   ITEM 3.   CONTROLS AND PROCEDURES....................................12

PART II.  OTHER INFORMATION.............................................13

   ITEM 1    LEGAL PROCEEDINGS..........................................13

   ITEM 2    CHANGES IN SECURITIES AND USE OF PROCEEDS..................13

   ITEM 3    DEFAULTS ON SENIOR SECURITIES..............................13

   ITEM 4    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS........13

   ITEM 5    OTHER INFORMATION..........................................13

   ITEM 6    EXHIBITS AND REPORTS ON FORM 8-K...........................14

      SIGNATURES........................................................14


                                     2

<PAGE>


               PART 1 - FINANCIAL INFORMATION

         ALLSTATES WORLDCARGO, INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED BALANCE SHEET

                           ASSETS

                                December       September
                                   31,            30,
                                  2002           2002
                               (Unaudited)         *
  Current Assets
    Cash and cash
    cash equivalents           $ 95,849      $ 173,277
    Accounts Receivable       5,376,027      5,752,732
    Prepaid taxes               218,581        199,977
    Prepaid expenses and
    other current assets      1,094,918        803,149
    Deferred income taxes        93,799         81,999
                             ----------      ---------
  Total current assets        6,879,174      7,011,134

  Property, plant and
  equipment                   1,372,117      1,403,658
  Less:  Accumulated
  depreciation                  940,136        935,447
                             ----------      ---------
  Net property, plant and
  equipment                     431,981        468,211

  Goodwill                      504,016        504,016
  Other assets                   67,010         67,134
                             ----------      ---------
  Total assets               $7,882,181     $8,050,495
                             ==========     ==========

            LIABILITIES AND STOCKHOLDERS' EQUITY

  Current Liabilities
    Accounts payable         $3,173,498     $3,150,565
    Accrued expenses            968,241        846,174
    Short-term bank
    borrowings                1,200,000      1,400,000
    Notes payable                60,141         80,720
                             ----------      ---------
  Total current liabilities   5,401,880      5,477,459

  Deferred tax liability -
   non-current                   16,600         37,000
  Long term portion of notes
  payable                     2,413,667      2,416,184

    Stockholders' equity
    Common stock                  3,251          3,251
    Retained earnings            46,783        116,601
                             ----------      ---------
  Total stockholders' equity     50,034        119,852

  Total liabilities and
  stockholders' equity        $7,882,181     $8,050,495
                              ==========     ==========

 *  Condensed from audited financial statements.

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

                                3
<PAGE>


         ALLSTATES WORLDCARGO, INC. AND SUBSIDIARIES

       CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                         (Unaudited)

                              Three Months Ended December
                                          31,
                                  2002           2001
  Revenues (net of
  discounts)                $13,089,484      $ 8,351,228
  Cost of transportation      8,548,925        5,102,242
                             ----------      -----------
  Gross profit                4,540,559        3,248,986

  Selling, general and
  administrative expenses     4,597,220        3,160,149
                             ----------      -----------
  Income from operations        (56,661)          88,837

  Other income (expense):
     Interest, net              (58,343)         (53,539)
     Other income                 2,173          ( 1,095)
                             ----------      -----------
  Income before income tax
  provision                    (112,831)          34,203

  Provision for income taxes    (43,012)          14,500

  Net income                  ($ 69,819)        $ 19,703
                             ==========      ===========

  Weighted average common
  shares - basic              32,509,872     32,509,872
  Net income per common
  share - basic                    $ .00          $ .00

  Weighted average common
  shares - diluted            32,509,872     32,509,872
  Net income per common
  share - diluted                  $ .00          $ .00

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

                                 4
<PAGE>



         ALLSTATES WORLDCARGO, INC. AND SUBSIDIARIES

  CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                          (DEFICIT)
                         (Unaudited)


<TABLE>
<S>                 <c>           <c>      <c>      <c>         <c>
                            Common Stock
                                             Other    Retained     Total
                        Number             Comprehen  Earnings  Stockholders'
                          of        Par      sive     (Deficit)    Equity
                        Shares     Value    Income                (Deficit)
                                            (Loss)
                    ___________  ______  _________  _________   _________

Balance at           32,509,872  $ 3,251             $116,602    $119,853
 September 30, 2002


Consolidated net
 income for the
 three months ended
 December 31, 2002                                    (69,819)    (69,819)
                    ___________  ______  _________  _________   _________

Balance at December
 31, 2002            32,509,872   3,251  $      0    $ 46,783   $  50,034
                    ===========  ======  =========  =========   =========

</TABLE>



                                 5
<PAGE>


         ALLSTATES WORLDCARGO, INC. AND SUBSIDIARIES

       CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                         (Unaudited)

                                       Three Months Ended
                                          December 31,
                                         2002       2001
  Cash flows from operating
  activities:
  Net income                        $(69,819)    $ 19,703
  Adjustments to reconcile net
  income to net cash provided
    by operating activities:
      Depreciation                    46,256       56,134
      Amortization                     1,166        1,166
      Provision for doubtful
        accounts                      50,301       32,620
      (Gain)/loss on sale of assets   (2,123)       2,511
      Deferred income taxes          (32,200)
      (Increase) decrease in assets:
          Accounts receivable        326,403      405,760
          Prepaid expenses and other
            assets                  (310,373)    (105,418)
       Increase (decrease) in
          liabilities:
          Accounts payable and
           accrued expenses          145,000     (541,452)
                                   ---------    ---------
  Net cash provided by (used for)
  operating activities               154,611     (128,976)

  Cash flows from investing
  activities:
     Purchase of equipment           (24,241)    (    853)
     Proceeds from sale of property
      and equipment                   16,338        3,300
     Security deposits                (1,040)       3,080
                                   ---------    ---------
  Net cash (used for)/provided by
  investing activities                (8,943)       5,527

  Cash flows from financing
  activities:
     Repayments under notes payable  (23,096)     (28,775)
     Repayments under short-term
      bank borrowings             (1,000,000)           0
     Borrowing under short-term
      Bank borrowings                800,000            0
                                   ---------    ---------
  Net cash used for financing
   activities                     (  223,096)     (28,775)

  Net (decrease) in cash
  and cash equivalents             ( 77,428)     (152,224)
  Cash and cash equivalents,
  beginning of year                 173,277       623,925
                                   ---------     ---------
  Cash and cash equivalents, end of
    period                           95,849       471,701
                                   =========     =========


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


                                6
<PAGE>

         ALLSTATES WORLDCARGO, INC. AND SUBSIDIARIES

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      December 31, 2002

1.   The accompanying unaudited condensed consolidated
  financial statements have been prepared by Allstates
  WorldCargo, Inc. (the "Company") in accordance with the
  rules and regulations of the Securities and Exchange
  Commission (the "SEC") for interim financial statements and
  accordingly do not include all information and footnotes
  required under generally accepted accounting principles for
  complete financial statements.  The financial statements
  have been prepared in conformity with the accounting
  principles and practices disclosed in, and should be read in
  conjunction with, the annual financial statements of the
  Company included in the Company's Fiscal year 2002 Form 10-K
  filing dated December 27, 2002 (File No. 000-24991).  In the
  opinion of management, these interim financial statements
  contain all adjustments necessary for a fair presentation of
  the Company's financial position at December 31, 2002 and
  September 30, 2002 and the results of operations for the
  three months ended December 31, 2002 and 2001, respectively.

2.   Net income per common share appearing in the statements
  of operations for the three months ended December 31, 2002
  and 2001, respectively have been prepared in accordance with
  Statement of Financial Accounting Standards No. 128 ("SFAS
  No. 128").  SFAS No. 128 establishes standards for computing
  and presenting earnings per share ("EPS") and requires the
  presentation of both basic and diluted EPS.  As a result
  primary and fully diluted EPS have been replaced by basic
  and diluted EPS.  Such amounts have been computed based on
  the profit or (loss) for the respective periods divided by
  the weighted average number of common shares outstanding
  during the related periods.

3.    The balance sheets of Allstates WorldCargo at December
  31,  2002  and  September  30, 2002  include  a  non-trade
  receivable of $702,000, pursuant to an agreement the Company
  entered  in to with a third party company.   In  September
  2000,  Allstates  had  extended an operating  loan  to  an
  unrelated  freight  and  warehouse  services  company,   Q
  Logistics Solutions, Inc. ("QLS"), as part of an agreement
  that the Company entered into to provide customer invoicing
  and vendor disbursement services.  The loan was secured by a
  $750,000 promissory note signed by the borrower,  and  for
  which  a  Form  UCC-1 financing statement was  filed.   In
  February 2001, QLS filed for Chapter 11 protection under the
  U.S.   bankruptcy  laws.   Pursuant  to   the   bankruptcy
  proceedings,  another  company,  unrelated  to   Allstates
  WorldCargo, Inc., purchased the assets of QLS in May 2001.
  At  that time, Allstates had outstanding loan advances  of
  approximately $702,000 to QLS.  As a contingency  of  that
  purchase,  Allstates entered in to an agreement  with  the
  other  company whereby Allstates assigned the  Form  UCC-1
  filing  to  them  in exchange for their  promissory  note,
  secured by a personal guarantee made by an officer of that
  company,  to  pay  the full loan amount  of  approximately
  $702,000,  plus 9% interest over six months, beginning  in
  April 2001.  The other company subsequently defaulted on the
  loan  after  having  made no payments to  Allstates.   The
  Company filed suit against the other company and against the
  guarantor for breach of contract, and subsequently the
  parties signed a Stipulation of Settlement whereby Allstates
  received a judgment against the other company for  the  full
  amount plus interest and   attorney's  fees.
  Subsequent  to  the quarter ended December 31,  2002,  the
  parties came to an agreement whereby the other company would
  pay  Allstates  a  total of $330,000 in  full  settlement.
  Payments are to be made over four equal monthly installments
  at $82,500 per month. The first installment was received by
  the Company in February 2003. If the other company defaults
  on  any of the scheduled payments, the full amount of  the
  receivable will become due.  Allstates will record a charge
  in  the  amount of $372,000 during the second  quarter  of
  fiscal  2003,  representing  the  difference  between  the
  receivable and the settlement amount.


                               7
<PAGE>


ITEM 2.  Management's Discussion and Analysis of Financial
Condition and Results of Operations.

General Overview

     Allstates WorldCargo, Inc. (the "Company" or
Allstates") is a New Jersey Corporation formed on January
14, 1997 as Audiogenesis Systems, Inc. (Audiogenesis"),
pursuant to a corporate reorganization of Genesis Safety
Systems, Inc.  On August 24, 1999, Audiogenesis acquired 100
percent of the common stock of Allstates Air Cargo, Inc. in
a reverse acquisition, and on November 30, 1999, changed its
name to Allstates WorldCargo, Inc.  The Company's business
is comprised of freight forwarding and the distribution and
sales of safety equipment.  Allstates is headquartered in
Forked River, New Jersey.

     The freight forwarding business of Allstates opened its
first terminal in Newark, New Jersey in 1961.  Allstates
provides domestic and international freight forwarding
services to over 1,700 customers utilizing ground
transportation, commercial air carriers, and ocean vessels.
Allstates operates 20 offices throughout the United States,
and employs 109 people.

     Allstates has agreements with domestic and
international strategic partners and a network of agents
throughout the world.  The Company is a party to several
site licensing agreements in which those licensees have
contracted with Allstates to provide exclusive freight
forwarding services, including sales and operating
functions, under the Allstates name.  Of the 20 domestic
locations, 9 are licensee operations, while 11 are company
owned and staffed operations.

     In September, 2000, Allstates entered in to an
agreement with an unrelated freight and warehousing company
to provide them services which primarily include customer
invoicing and transportation vendor disbursements on
business that they provide to the Company.  Per the
agreement, Allstates paid a commission to this company based
on the invoiced amount, less deductions for transportation
cost and a fee for providing the service.  In May, 2001, the
assets of that company were purchased by another company
unrelated to Allstates WorldCargo, Inc., and consequently
the service agreement was terminated.


Results of Operations

     The   following  table  sets  forth  for  the   periods
indicated  certain financial information  derived  from  the
Company's consolidated statement of operations expressed  as
a percentage of net sales:
                                   Three Months Ended December 31,
                                         2002          2001
                                         ----          ----
Revenues                                100.0%        100.0%
Cost  of transportation                  65.3          61.1
                                         ----          ----
Gross profit                             34.7          38.9

Selling, general and
 administrative expenses                 35.1          37.8
                                         ----          ----
Operating income                         (0.4)          1.1
                                         ====          ====
Net    income                            (0.5%)         0.2%

Revenues
     Revenues  of  the Company represents gross consolidated
sales  less  customer  discounts.  Total  revenues  for  the
quarter ended December 31, 2002 increased by $4,738,000,  or
56.7%,  to $13,089,000, from the quarter ended December  31,
2001,  reflecting  a  higher volume of shipments  and  total
weight  of  cargo shipped.  The increase in shipping  volume
can be partially attributed to a combination of the addition
of two new stations during the third quarter of fiscal 2002,
as  well  as  the effect of additional sales personnel  that
were  hired in the third and fourth quarters of fiscal 2002.
Further  accentuating the increase in revenues,  during  the
comparative three month period ended December 31, 2001 sales
volume  had decreased in part due to the adverse effects  of
the events of September 11, 2001.

                             8
<PAGE>

     Included  in  total revenues of the three month  period
ended  December  31,  2002  is approximately  $1,787,000  of
billing to one customer for the arrangement of international
chartered  aircraft.  The Company was asked  to  make  these
arrangements by its customer as an emergency response to the
backlog  of ocean freight deliveries that resulted from  the
lock  out  of  West Coast ports.  Although Allstates  offers
charter  airline services to its customers as  part  of  the
normal  course of business, it cannot guarantee a recurrence
of that  service at that  level of billing.   International
revenues increased in total  by  approximately $2.1  million
or  98.2%,  to $4,215,000.

     Domestic  revenues  increased  by  approximately   $2.6
million  or  42.6%,  to  $8,874,000 during  the  three-month
period  ended December 31, 2002 in comparison  to  the  same
period  in  the  previous year.  Domestic revenues  included
sales  that were generated from one customer that  accounted
for  11.7%  of  total revenues for the current  fiscal  year
quarter.   Allstates has provided freight services  to  this
customer  for  more than two years.  Although  Allstates  is
confident  in  its  ability to continue to  provide  freight
services to this customer, there is no contractual agreement
in  place, and therefore the Company can not guarantee  that
this business will continue indefinitely.


Gross Profit

     Gross  profit  represents the  difference  between  net
revenues  and  the  cost of sales.  The  cost  of  sales  is
composed  primarily  of  amounts  paid  by  the  Company  to
carriers  and  cartage agents for the  transport  of  cargo.
Cost of sales as a percentage of revenues increased by 4.2%,
to  65.3%, for the three months ended December 31, 2002,  in
comparison  to the same period in the previous  year.   This
increase  is  primarily  due to the effect  of  the  charter
airline  services that Allstates provided  to  one  customer
during  the  period, which commands a higher cost  of  sales
percentage than typical freight forwarding services.   After
discounting  the effect of the charter airline service,  the
cost  of  sales percentage would have increased by 1.4%,  to
62.5%.    In absolute terms, the cost of sales increased  by
approximately  $3.4 million or 67.6%, to  $8,549,000  during
the   three  months  ended  December  31,  2002  versus  the
comparative  period  in  the  prior  year,  reflecting   the
increased  sales volume.  Gross margins decreased  to  34.7%
during the quarter ended December 31, 2002 from 38.9% in the
same  quarter  of  the previous fiscal year.   Gross  profit
increased by approximately $1,292,000 to $4,541,000 for  the
three  months ended December 31, 2002 versus the same  three
months of the prior year.


Selling, General and Administrative Expenses

     As  a percentage of sales, operating expenses decreased
by  2.7%  for  the three months ended December 31,  2002  in
comparison  to  the  three months ended December  31,  2001,
reflecting  higher  sales  volume  in  relation   to   fixed
operating  costs.   In  absolute terms,  operating  expenses
increased  by approximately $1,437,000 or 45.5%  during  the
three-month  period ended December 31, 2002 as  compared  to
the  same period in the prior fiscal year.  The increase  in
SG&A expenses reflects a combination of the increased volume
of revenues and gross profit during the quarter, represented
primarily by higher commissions expense, the addition of two
company  stations,  and the overall increase  in  sales  and
operations headcount.

     Allstates  paid  commissions to salespeople,  licensees
and   an  independent  sales  agent,  as  compensation   for
generating profits to the Company.  Licensee commissions and
royalties paid pursuant to licensee agreements increased  by
approximately  $548,000  for the  three-month  period  ended
December  31, 2002 in comparison to the same period  in  the
previous year, reflecting the higher level of gross  profits
at certain licensee operations.  During the third quarter of
fiscal   2002,  Allstates  signed  an  agreement   with   an
independent   sales  agent  whereby  the  Company   pays   a
percentage  of gross profits earned from revenues  generated
by  the  agent.   Allstates  paid approximately  $77,000  in
commissions  to  this agent during the  three  months  ended
December 31, 2002.
                           9
<PAGE>
     Personnel   expenses  were  higher   by   approximately
$519,000 during the three months ended December 31, 2002  as
compared  to the same period of the prior year.  During  the
third  quarter of fiscal 2002, Allstates opened and  staffed
two  company-owned stations in Florida, where there had been
no  presence in recent years, and also increased  sales  and
operations  staff  in other existing locations.   On  a  net
basis,  the  Company's headcount increased  by  22,  to  109
employees  at  December 31, 2002, compared to  December  31,
2001.

     Facilities expenses increased by approximately $104,000
during the quarter ended December 31, 2002 in comparison  to
the  quarter  ended  December 31,  2001,  driven  by  higher
telephone  and  data  line expense as well  as  higher  rent
expense.   Allstate's stations are connected on a  real-time
basis  via  data  lines  to  a centralized  computer  system
located at the Company's corporate office.  During the first
quarter  of  fiscal  2003, in order to  realize  a  smoother
transmission of data during high volume periods, the Company
converted from T1 data line service to a frame relay.   This
process required that both services run concurrently  for  a
limited  period until the conversion was completed in  full.
The  charges  for concurrent services totaled  approximately
$30,000  during the quarter.  The conversion  was  completed
prior  to  the  end  of the first quarter  of  fiscal  2003,
therefore  the  Company does not expect any further  related
expense.  Other telephone expense increased by approximately
$32,000  due to the increase in salespersonnel as  well  the
addition  of  the  two  new  stations.   Rent  expense   was
approximately $34,000 higher during the current fiscal  year
quarter  than  in  the same quarter of  the  previous  year,
primarily reflecting rental of warehouse space at one of the
new  Florida  stations.  That station  provides  warehousing
service to one of its customers. Per an agreement with  that
customer,  the station is guaranteed a minimum profit  which
fully covers the rental expense.

     MIS  fees,  which represent the expense of  maintaining
the computer system and programming modifications to improve
its  output  and  performance,  increased  by  approximately
$39,000  during the quarter ended December 31,  2002  versus
the  same  period ended December 31, 2001.  Enhancements  to
the  Company's EDI capability and streamlining  of  customer
order  entry  accounted  for much of  the  increase.   Other
expenses  related  to the increase in salesperson  headcount
and  the  opening of the two company stations accounted  for
the  balance  of  the  increase in  SG&A.   Auto  allowances
increased by approximately $34,000 and travel &entertainment
expense increased by approximately $25,000.

     SG&A  expenses  presented for the  three  months  ended
December 31, 2002 and 2001 are inclusive of expenditures  to
related    parties   totaling   $385,478    and    $348,790,
respectively.

Income/(Loss) From Operations

     Operating  income  decreased during  the  three  months
ended December 31, 2002 by approximately $145,000, to a loss
of  ($57,000), as compared to operating income of $89,000 in
the  same  three month period in the previous year  for  the
reasons  indicated above.  In comparison to  the  respective
period  in  fiscal 2001, the operating margin for the  three
month  period ended December 31, 2002 decreased by 1.5%,  to
(0.4%) of sales.

Interest Expense and Income

     Net interest expense increased for the three months
ended December 31, 2002 by approximately $5,000 as compared
to the same period in the previous year, reflecting a higher
level of borrowing on the Company's bank line of credit,
offset by lower interest rates.

Net Income/(Loss)

     Income  before  income taxes decreased  to  a  loss  of
approximately ($113,000) during the quarter ended December 31,
2002 from a profit of $34,000 during the same period in  the
prior  year.  The Company recorded a tax benefit of  $43,000
for the quarter ended December 31, 2002 as compared to a tax
provision  of $15,000 for quarter ended December  31,  2001.
The  net loss amounted to approximately ($70,000) or  (0.5%)

                            10
<PAGE>

of revenues during the first quarter of Fiscal 2003 versus a
net  profit  of  $20,000 or 0.2% of revenues  in  the  first
quarter of Fiscal 2002.


Liquidity and Capital Resources

     Net   cash   provided  by  operating   activities   was
approximately  $155,000 for the three months ended  December
31,  2002,  compared  to cash flow used  for  operations  of
approximately  $129,000 for the three months ended  December
31,  2001.   For the three months ended December  31,  2002,
cash  was  provided by a net decrease in accounts receivable
and  an  increase in accounts payable, offset by an increase
in other current assets.  In December 2002, Allstates made a
temporary  transfer  of $300,000 to  a  bonding  company  as
security  for  a  legal  judgement in the  Company's  favor.
Those  funds  were returned in January 2003 in  favor  of  a
letter  of credit issued through the Company's bank.  During
the three months ended December 31, 2001, cash was primarily
used  to  satisfy  trade  accounts payable  and  income  tax
obligations, offset by a decrease in accounts receivable  as
well as the net income of the Company.

     At  December  31, 2002, the Company had cash  and  cash
equivalents   of   $96,000  and  net  working   capital   of
$1,477,000,  compared  with cash  and  cash  equivalents  of
$472,000 and net working capital of $1,378,000 respectively,
at  December 31, 2001.  The increase in working  capital  at
December  31,  2002  over December  31,  2001  is  primarily
attributable  to the Company's net income during  the  prior
twelve month period.

     The  Company's investing activities were  comprised  of
expenditures  for capital equipment, primarily  representing
purchases of computer hardware and software.  For the  three
months   ended   December  31,  2002,  capital  expenditures
amounted    to   approximately   $24,000,   while    capital
expenditures amounted to approximately $1,000 for the  three
months ended December 31, 2001.

     The  Company  has a commercial line of  credit  with  a
bank,  pursuant  to  which  the Company  may  borrow  up  to
$2,000,000,  based on a maximum of 70% of eligible  accounts
receivable.   Per  the  agreement, interest  on  outstanding
borrowings  accrues at the Wall Street Journal's prime  rate
of interest (4.25% at December 31, 2002).  The interest rate
is  predicated  on  the Company maintaining  a  compensating
account  balance in a non-interest bearing account equal  to
at  least 10% of the outstanding principal balance.  If such
average  compensating  balances  are  not  maintained,   the
interest  rate  will increase by 1% over the rate  currently
accruing.   Outstanding borrowings on  the  line  of  credit
totaled $1,200,000 as of December 31, 2002.

     In  September,  2000, Allstates extended  an  operating
loan to an unrelated freight and warehouse services company,
Q Logistics Solutions, Inc. ("QLS"), as part of an agreement
that  the Company entered into to provide customer invoicing
and vendor disbursement services.  The loan was secured by a
$750,000  promissory note signed by the  borrower,  and  for
which  a  Form  UCC-1  financing statement  was  filed.   In
February 2001, QLS filed for Chapter 11 protection under the
U.S.   bankruptcy   laws.   Pursuant   to   the   bankruptcy
proceedings,   another  company,  unrelated   to   Allstates
WorldCargo, Inc., purchased the assets of QLS in  May  2001.
Allstates  had  outstanding loan advances  of  approximately
$702,000 to QLS prior to the purchase.  As a contingency  of
that purchase, Allstates entered in to an agreement with the
other  company  whereby Allstates assigned  the  Form  UCC-1
filing  to  them  in  exchange for  their  promissory  note,
secured  by a personal guarantee made by an officer of  that
company,  to  pay  the  full loan  amount  of  approximately
$702,000,  plus  9% interest over six months,  beginning  in
April 2001.  The other company subsequently defaulted on the
loan  after  having  made  no payments  to  Allstates.   The
Company  filed suit against the other company and against the
guarantor for breach  of contract,  and subsequently the
parties signed a Stipulation of Settlement whereby Allstates
received a judgement against the other company for  the full
amount plus interest and attorney's fees.   An
$80,000 payment in lieu of the personal guarantee was placed
in  escrow pending legal review of documentation supplied to
the  Company.   In  January, 2003, the parties  came  to  an
agreement  whereby the other company would pay  Allstates  a
total  of $330,000 in full settlement.  Payments are  to  be
made  over  four equal monthly installments at  $82,500  per
month.    The  first installment, which primarily represents
the release of the escrow funds, was received by the Company
in February 2003.

                                     11
<PAGE>

Forward Looking Statements

The  statements  contained in all  parts  of  this  document
including,  but  not  limited  to,  those  relating  to  the
availability of cargo space; the Company's overseas presence
and  the  plans  for,  effects, results  and  expansion   of
international  operations and agreements  for  international
cargo; future international revenue and international market
growth;  the  future expansion and results of the  Company's
terminal  network;  plans for local  delivery  services  and
truck   brokerage;  future  improvements  in  the  Company's
information  systems  and  logistic  systems  and  services;
technological   advancements;  future   marketing   results;
construction   of  the  new  facilities;   the   effect   of
litigation; future costs of transportation; future operating
expenses;  future margins; any seasonality of the  Company's
business; future dividend plans; future acquisitions and the
effects,  benefits, results, terms or other aspects  of  any
acquisition,   effects  of  the  Year  2000   issue;   Ocean
Transportation  Intermediary License;  ability  to  continue
growth  and  implement  growth and  business  strategy;  the
ability  of expected sources of liquidity to support working
capital   and   capital  expenditure  requirements;   future
expectations;  and  any  other statements  regarding  future
growth,   future   cash  needs,  future  terminals,   future
operations,   business  plans,  future  financial   results,
financial targets and goals; and any other statements  which
are  not  historical  facts are forward-looking  statements.
When   used   in  this  document,  the  words  "anticipate,"
"estimate," "expect," "may," "plans," "project" and  similar
expressions  are  intended to be among the  statements  that
identify forward-looking statements. Such statements involve
risks  and  uncertainties, including, but  not  limited  to,
those relating to the Company's dependence on its ability to
attract and retain skilled managers and other personnel; the
intense   competition  within  the  freight  industry;   the
uncertainty of the Company's ability to manage and  continue
its   growth  and  implement  its  business  strategy;   the
Company's dependence on the availability of cargo  space  to
serve  its customers; the effects of regulation; results  of
litigation; the Company's vulnerability to general  economic
conditions;   the   control  by  the   Company's   principal
shareholder;   risks  of  international  operations;   risks
relating to acquisitions; the Company's future financial and
operating  results, cash needs and demand for its  services;
and  the  Company's  ability to  maintain  and  comply  with
permits  and licenses, as well as other factors detailed  in
this  document  and  the Company's other  filings  with  the
Securities  and Exchange Commission. Should one or  more  of
these   risks  or  uncertainties  materialize,   or   should
underlying assumptions prove incorrect, actual outcomes  may
vary materially from those indicated. The Company undertakes
no  responsibility to update for changes related to these or
any other factors that may occur subsequent to this filing.

ITEM 3    CONTROLS AND PROCEDURES

(a)     Evaluation of Disclosure Controls and Procedures.  The Company's
principal executive officer and principal financial officer, based on their
evaluation of the Company's disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) as of a date within 90 days prior to the
filing of this Quarterly Report on Form 10Q, concluded that the Company's
disclosure controls and procedures are adequate and effective for the purposes
set forth in the definition in the Exchange Act rules.

(b)     Changes in Internal Controls.  There were no significant changes in the
Company's internal controls or in other factors that could significantly affect
the Company's internal controls subsequent to the date of the evaluation.

                                     12
<PAGE>


PART II

OTHER INFORMATION
------------------

ITEM 1    LEGAL PROCEEDINGS

In the matter of Allstate's WorldCargo, Inc. v. Logistics Management
Resources, Inc. and Daniel Pixler, Superior Court of  New Jersey Law
Division, Ocean County (Docket No. OCN-L-1822-01) in which the Company
asserted a breach of contract, the parties, subsequent  to  the quarter
ended December 31,  2002, came to an agreement whereby the defendants
would pay  Allstates  a  total of $330,000 in  full  settlement.
Payments are to be made over four equal monthly installments
at $82,500 per month. The first installment was received by
the Company in February 2003. If the other company defaults
on  any of the scheduled payments, the full amount of  the
receivable will become due.  Allstates will record a charge
in  the  amount of $372,000 during the second  quarter  of
fiscal  2003,  representing  the  difference  between  the
receivable and the settlement amount.


ITEM 2    CHANGES IN SECURITIES AND USE OF PROCEEDS

NONE


ITEM 3    DEFAULTS ON SENIOR SECURITIES

NONE


ITEM 4    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

NONE

ITEM 5    OTHER INFORMATION

NONE

ITEM 6    EXHIBITS AND REPORTS ON FORM 8-K

     (a) Exhibits

         None

     (b) Reports on Form 8-K

         None


                                      13


<PAGE>



SIGNATURES

Pursuant to the requirements of the Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.


ALLSTATES WORLDCARGO, INC.


BY:       /s/ SAM DIGIRALOMO                  DATED:    February 14, 2003
        ---------------------------------               -----------------
          Sam DiGiralomo, President and CEO




BY:       /s/ Craig D. Stratton               DATED:    February 14, 2003
        ---------------------------------               -----------------
          Craig D. Stratton, CFO, Secretary,
        Treasurer and Principal Financial Officer




                                     -14-


                           CERTIFICATION PURSUANT TO
                            18 U.S.C. SECTION 1350,
                            AS ADOPTED PURSUANT TO
                SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of ALLSTATES WORLDCARGO, INC. (the
"Company") on Form 10Q for the period ending December 31, 2002 as filed with
the Securities and Exchange Commission on the date hereof (the "Report"), I,
Sam DiGiralomo, Chief Executive Officer of the Company, certify, pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:

          (1) The Report fully complies with the requirements of section 13(a)
or 15(d) of the Securities Exchange Act of 1934; and

          (2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Company.




Sam DiGiralomo

Chief Executive Officer
February 14, 2003



                          CERTIFICATION PURSUANT TO
                           18 U.S.C. SECTION 1350,
                           AS ADOPTED PURSUANT TO
                 SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of ALLSTATES WORLDCARGO, INC. (the
"Company") on Form 10Q for the period ending December 31, 2002 as filed with
the Securities and Exchange Commission on the date hereof (the "Report"), I,
Craig D. Stratton, Chief Financial Officer of the Company, certify, pursuant
to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:

         (1) The Report fully complies with the requirements of section 13(a)
or 15(d) of the Securities Exchange Act of 1934; and

          (2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Company.


Craig D. Stratton

Chief Financial Officer
February 14, 2003

                                     -15-
<PAGE>



                          CERTIFICATION PURSUANT TO THE
                               SARBANES-OXLEY ACT

I, Sam DiGiralomo, the Chief Executive Officer of ALLSTATES WORLDCARGO, INC.,
certify that:

1. I have reviewed this quarterly report on Form 10-Q of ALLSTATES WORLDCARGO,
INC.;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4. I am responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
registrant and have:

  a) designed such disclosure controls and procedures to ensure that material
     information relating to the registrant, including its consolidated
     subsidiaries, is made known to me by others within those entities,
     particularly during the period in which this quarterly report is being
     prepared;

  b) evaluated the effectiveness of the registrant's disclosure controls and
     procedures as of a date within 90 days prior to the filing date of this
     quarterly report (the "Evaluation Date"); and

  c) presented in this quarterly report my conclusions about the
     effectiveness of the disclosure controls and procedures based on my
     evaluation as of the Evaluation Date;

5. I have disclosed, based on my most recent evaluation, to the registrant's
auditors and the audit committee of registrant's board of directors (or
persons performing the equivalent functions):

  a) all significant deficiencies in the design or operation of internal
     controls which could adversely affect the registrant's ability to
     record, process, summarize and report financial data and have identified
     for the registrant's auditors any material weaknesses in internal
     controls; and

  b) any fraud, whether or not material, that involves management or other
     employees who have a significant role in the registrant's internal
     controls; and

6. I have indicated in this quarterly report whether there were significant
changes in internal controls or in other factors that could significantly
affect internal controls subsequent to the date of my most recent evaluation,
including any corrective actions with regard to significant deficiencies and
material weaknesses.

Date: February 14, 2003                 /s/ Sam DiGiralomo
                                     -----------------------------
                                     Sam DiGiralomo, Chief Executive Officer

                                      -16-
<PAGE>



                          CERTIFICATION PURSUANT TO THE
                               SARBANES-OXLEY ACT

I, Craig D. Stratton, the Chief  Financial  Officer of ALLSTATES WORLDCARGO,
INC., certify that:

1. I have reviewed this quarterly report on Form 10-Q of ALLSTATES WORLDCARGO,
INC.;

2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4. I am responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
registrant and have:

   a) designed such disclosure controls and procedures to ensure that material
      information relating to the registrant, including its consolidated
      subsidiaries, is made known to me by others within those entities,
      particularly during the period in which this quarterly report is being
      prepared;

   b) evaluated the effectiveness of the registrant's disclosure controls and
      procedures as of a date within 90 days prior to the filing date of this
      quarterly report (the "Evaluation Date"); and

   c) presented in this quarterly report my conclusions about the effectiveness
of
      the disclosure controls and procedures based on my evaluation as of the
      Evaluation Date;

5. I have disclosed, based on my most recent evaluation, to the registrant's
auditors and the audit committee of registrant's board of directors (or persons
performing the equivalent functions):

   a) all significant deficiencies in the design or operation of internal
      controls which could adversely affect the registrant's ability to record,
      process, summarize and report financial data and have identified for the
      registrant's auditors any material weaknesses in internal controls; and

   b) any fraud, whether or not material, that involves management or other
      employees who have a significant role in the registrant's internal
      controls; and

6. I have indicated in this quarterly report whether there were significant
changes in internal controls or in other factors that could significantly affect
internal controls subsequent to the date of my most recent evaluation, including
any corrective actions with regard to significant deficiencies and material
weaknesses.

Date: February 14, 2003                 /s/ Craig D. Stratton
                                     -----------------------------
                                     Craig D. Stratton, Chief Financial Officer

                                      -17-