SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

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

For the Period Ended September 30, 2003        Commission File Number 0-10763


                               Atrion Corporation
             (Exact Name of Registrant as Specified in its Charter)


              Delaware                                 63-0821819
-------------------------------------     ------------------------------------
  (State or Other Jurisdiction of         (I.R.S. Employer Identification No.)
   Incorporation or Organization)

                    One Allentown Parkway, Allen, Texas      75002
                    ----------------------------------------------
               (Address of Principal Executive Offices)   (Zip Code)

                                 (972) 390-9800
                                 --------------
              (Registrant's Telephone Number, Including Area Code)

Indicate by check whether the registrant: (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                             YES      X        NO
                                  ---------        ---------

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

                                             Number of Shares Outstanding at
         Title of Each Class                        November 5, 2003
-----------------------------------------    -------------------------------
Common stock, Par Value $0.10 per share                 1,696,757

<PAGE>

                       ATRION CORPORATION AND SUBSIDIARIES
                       -----------------------------------

                                TABLE OF CONTENTS
                                -----------------



PART I.       Financial Information                                            2

   Item 1.   Financial Statements

               Consolidated Statements of Income (Unaudited)
                   For the Three and Nine Months Ended
                   September 30, 2003 and 2002                                 3


               Consolidated Balance Sheets
                   September 30, 2003 (Unaudited) and December 31, 2002        4


               Consolidated Statements of Cash Flows (Unaudited)
                   For the Nine Months Ended
                   September 30, 2003 and 2002                                 5


               Notes to Consolidated Financial Statements (Unaudited)          6

   Item 2.   Management's Discussion and Analysis of
               Financial Condition and Results of
               Operations                                                      9

PART II.      Other Information                                               14

   Item 6.   Exhibits and Reports on
               Form 8-K                                                       14

SIGNATURES                                                                    16


                                       1
<PAGE>

                                     PART I


                              FINANCIAL INFORMATION


                                       2
<PAGE>
<TABLE>
<CAPTION>

                Item 1.        Financial Statements
                       ATRION CORPORATION AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)

                                                                    Three Months Ended                    Nine Months Ended
                                                                       September 30,                        September 30,
                                                              --------------------------------    ----------------------------------
                                                                   2003              2002              2003               2002

                                                                            (in thousands, except per share amounts)

<S>                                                            <C>                <C>              <C>                <C>
Revenues                                                       $    16,117        $   14,662       $    48,013        $    44,262
Cost of goods sold                                                  10,291             9,620            31,014             28,705
                                                               -----------        ----------       -----------        -----------
Gross profit                                                         5,826             5,042            16,999             15,557
                                                               -----------        ----------       -----------        -----------

Operating expenses:
   Selling                                                           1,437             1,306             4,235              4,142
   General and administrative                                        1,987             1,708             5,872              5,375
   Research and development                                            547               643             1,607              1,700
                                                               -----------        ----------       -----------        -----------
                                                                     3,971             3,657            11,714             11,217
                                                               -----------        ----------       -----------        -----------
Operating income                                                     1,855             1,385             5,285              4,340
                                                               -----------        ----------       -----------        -----------

Other income (expense):
   Interest income                                                      16                17                55                 58
   Interest expense                                                    (46)             (105)             (161)              (346)
   Other income (expense), net                                           5               (19)               -                 (16)
                                                               -----------        -----------      -----------        -----------
                                                                       (25)             (107)             (106)              (304)
                                                               ------------       ----------       -----------        -----------
Income from continuing operations
    before provision for income taxes                                1,830             1,278             5,179              4,036

Provision for income taxes                                             500               181             1,551              1,002
                                                               -----------        ----------       -----------        -----------

Income from continuing operations                                    1,330             1,097             3,628              3,034
Gain on disposal of discontinued operations, net of income
    taxes                                                                -                 -               165                165
Cumulative effect of change in accounting principle, net of
   income taxes                                                          -                 -                 -             (1,641)
                                                               -----------        ----------       -----------        -----------
Net income                                                     $     1,330        $    1,097       $     3,793        $     1,558
                                                               ===========        ==========       ===========        ===========

Income per basic share:
   Income from continuing operations                           $      0.79        $     0.64       $      2.11        $      1.77
   Gain on disposal of discontinued operations                           -                 -              0.10               0.10
   Cumulative effect of change in accounting principle                   -                 -                -               (0.96)
                                                               -----------        ----------       -----------        -----------
                                                               $      0.79        $     0.64       $      2.21        $      0.91
                                                               ===========        ==========       ===========        ===========

Weighted average basic shares outstanding                            1,683             1,720             1,716              1,712
                                                               ===========        ==========       ===========        ===========

Income per diluted share:
   Income from continuing operations                           $      0.73        $      .59       $      1.98        $      1.61
   Gain on disposal of discontinued operations                           -                 -              0.09               0.09
   Cumulative effect of change in accounting principle                   -                 -                 -              (0.87)
                                                               -----------        ----------       -----------        -----------
                                                               $      0.73        $     0.59       $      2.07        $      0.83
                                                               ===========        ==========       ===========        ===========

Weighted average diluted shares outstanding                          1,823             1,849             1,835              1,879
                                                               ===========        ==========       ===========        ===========

</TABLE>

The accompanying notes are an integral part of these statements.


                                       3
<PAGE>
<TABLE>
<CAPTION>

                       ATRION CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                 (in thousands)

                                                                   September 30,                 December 31,
                                                                        2003                         2002
Assets                                                              (unaudited)
------                                                            --------------------      --------------------
Current assets:
<S>                                                                  <C>                        <C>
   Cash and cash equivalents                                         $          431             $          353
   Accounts receivable                                                        7,853                      6,721
   Inventories                                                               11,949                     10,311
   Prepaid expenses                                                           1,518                      2,273
   Other                                                                      1,018                      1,018
                                                                     --------------             --------------
                                                                             22,769                     20,676
                                                                     --------------             --------------


Property, plant and equipment                                                45,518                     42,661
Less accumulated depreciation and amortization                               20,649                     18,211
                                                                     --------------             --------------
                                                                             24,869                     24,450
                                                                     --------------             --------------

Other assets and deferred charges:
   Patents                                                                    2,175                      2,403
   Goodwill                                                                   9,730                      9,730
   Other                                                                      3,332                      3,548
                                                                     --------------             --------------
                                                                             15,237                     15,681
                                                                     --------------             --------------

                                                                     $       62,875             $       60,807
                                                                     ==============             ==============


Liabilities and Stockholders' Equity
------------------------------------
   Current liabilities:
   Accounts payable and accrued liabilities                          $        6,683             $        5,030
   Accrued income and other taxes                                             1,426                        859
                                                                     --------------             --------------
                                                                              8,109                      5,889
                                                                     --------------             --------------

Line of credit                                                                7,502                     10,337

Other non-current liabilities                                                 3,606                     2,890

Stockholders' equity:
   Common shares, par value $0.10 per share; authorized
      10,000 shares, issued 3,420 shares                                        342                        342
   Paid-in capital                                                            9,181                      8,222
   Retained earnings                                                         67,840                     64,249
   Treasury shares,1,730 at September 30, 2003 and 1,714
   at December 31, 2002, at cost                                            (33,705)                   (31,122)
                                                                     ---------------            --------------
       Total stockholders' equity                                            43,658                     41,691
                                                                     --------------             --------------


                                                                     $       62,875             $       60,807
                                                                     ==============             ==============
</TABLE>


The accompanying notes are an integral part of these statements.


                                       4
<PAGE>
<TABLE>
<CAPTION>

                       ATRION CORPORATION AND SUBSIDIARIES
                      Consolidated Statements of Cash Flows
                                   (Unaudited)

                                                                                         Nine Months Ended
                                                                                           September 30,
                                                                           ---------------------------------------------
                                                                                  2003                      2002
                                                                           -------------------       -------------------
                                                                                           (in thousands)
Cash flows from operating activities:
<S>                                                                          <C>                       <C>
   Net income                                                                $       3,793             $       1,558
   Adjustments to reconcile net income to
      net cash provided by operating activities:
        Goodwill impairment, net of income taxes                                         -                     1,641
        Gain on disposal of discontinued operations                                   (165)                     (165)
        Depreciation and amortization                                                3,369                     3,237
        Deferred income taxes                                                          298                      (189)
        Tax benefit related to stock plans                                             204                        56
        Other                                                                           31                       127
                                                                             -------------             -------------
                                                                                     7,530                     6,265

    Changes in operating assets and liabilities:
        Accounts receivable                                                         (1,132)                   (2,798)
        Inventories                                                                 (1,638)                     (387)
        Prepaid expenses                                                               755                         -
        Other non-current assets                                                       215                       725
        Accounts payable and current liabilities                                     1,653                       256
        Accrued income and other taxes                                                 567                       709
        Other non-current liabilities                                                  420                      (181)
                                                                             -------------             -------------
    Net cash provided by continuing operations                                       8,370                     4,589
    Net cash provided by discontinued operations                                       165                       165
                                                                             -------------             -------------
                                                                                     8,535                     4,754
Cash flows from investing activities:
  Property, plant and equipment additions                                           (3,611)                   (2,611)
  Property, plant and equipment sales                                                   20                        15
                                                                             -------------             -------------
                                                                                    (3,591)                   (2,596)
                                                                             -------------             -------------

Cash flows from financing activities:
  Net change in line of credit                                                      (2,835)                   (2,188)
  Purchase of treasury stock                                                        (4,069)                     (308)
  Issuance of common stock                                                           2,240                       345
  Dividends                                                                           (202)                       -
                                                                             -------------             -------------
                                                                                    (4,866)                   (2,151)
                                                                             -------------             -------------

Net change in cash and cash equivalents                                                 78                         7
Cash and cash equivalents at beginning of period                                       353                       542
                                                                             -------------             -------------
Cash and cash equivalents at end of period                                   $         431             $         549
                                                                             =============             =============



Cash paid for:
  Interest                                                                   $         171             $         320
  Income taxes                                                               $       1,105             $         190

</TABLE>

The accompanying notes are an integral part of these statements.


                                       5
<PAGE>

                       ATRION CORPORATION AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

(1)  Basis of Presentation
     In  the  opinion  of  management,  all  adjustments  necessary  for a  fair
     presentation  of results of operations for the periods  presented have been
     included in the accompanying unaudited consolidated financial statements of
     Atrion  Corporation  (the "Company").  Such  adjustments  consist of normal
     recurring items. The accompanying  financial  statements have been prepared
     in  accordance  with  the   instructions  to  Form  10-Q  and  include  the
     information  and notes  required  by such  instructions.  Accordingly,  the
     consolidated  financial  statements  and  notes  thereto  should be read in
     conjunction  with  the  financial  statements  and  notes  included  in the
     Company's 2002 Annual Report on Form 10-K.

(2)  Intangible Assets
     In July 2001,  the  Financial  Accounting  Standards  Board  (FASB)  issued
     Statement of Financial  Accounting  Standards (SFAS) No. 142, "Goodwill and
     Other Intangible Assets". Under SFAS No. 142, goodwill is no longer subject
     to  amortization,  but is now subject to at least an annual  assessment for
     impairment  by  applying  a fair  value-based  test.  SFAS No.  142  became
     effective  for the Company on January 1, 2002.  The Company  completed  the
     process of performing  an impairment  analysis as required by SFAS No. 142,
     resulting in a write-down  of goodwill,  in the first  quarter of 2002,  of
     $1.6  million,  net of income tax. The charge  reflected a reduction in the
     goodwill  resulting from the acquisition of Quest Medical in February 1998.
     The impairment  loss was recorded as the  cumulative  effect of a change in
     accounting principle.

     Intangible  assets consist of the following (in  thousands,  except average
     life):

<TABLE>
<CAPTION>
                                                         September 30, 2003              December 31, 2002
                                                   --------------------------------------------------------------
                                         Average       Gross                           Gross
                                           Life       Carrying      Accumulated       Carrying      Accumulated
                                         (years)       Amount       Amortization       Amount
Amortization
                                         --------- --------------- --------------- --------------- --------------
      Amortized intangible assets:
<S>                                       <C>        <C>            <C>              <C>            <C>
            Patents                       12.85      $   9,250      $    7,075       $   9,250      $    6,847

      Intangible assets not subject to amortization:
            Goodwill                                 $   9,730      $     -          $   9,730      $      -

</TABLE>

     Aggregate  amortization expense for each of the nine months ended September
     30, 2003 and September 30, 2002 was $228,000.

     Estimated  amortization  expense for each of the following  years ending on
     December 31, is as follows (in thousands):

                                             2003             $         304
                                             2004             $         304
                                             2005             $         271
                                             2006             $         169
                                             2007             $         144


                                       6
<PAGE>

     The change in the  carrying  amount of goodwill  for the nine months  ended
     September 30, 2002 is as follows (in thousands):

     Balance as of January 1, 2002                      $           12,216
     Impairment loss                                                 2,486
                                                        ------------------
     Balance as of September 30, 2002                   $            9,730
                                                        ==================

(3)  Inventories
     Inventories  are stated at the lower of cost or market.  Cost is determined
     by using the first-in,  first-out  method.  The following table details the
     major components of inventory (in thousands):

                                     September 30,            December 31,
                                         2003                    2002
-----------------------------------------------------------------------------
Raw materials                       $        5,803        $        6,082
Finished goods                               4,293                 2,818
Work in process                              1,853                 1,411
-----------------------------------------------------------------------------
Total inventories                   $       11,949        $       10,311
-----------------------------------------------------------------------------

(4)  Income per share
     The  following is the  computation  for basic and diluted  income per share
     from continuing operations:

<TABLE>
<CAPTION>
                                                           Three months ended                    Nine months ended
                                                              September 30,                        September 30,
                                                          2003             2002                2003           2002
                                                     ---------------- ---------------     --------------- -------------
                                                                    (in thousands, except per share amounts)

<S>                                                  <C>              <C>                 <C>             <C>
Income from continuing operations                    $       1,330    $     1,097         $     3,628     $      3,034
                                                     ================ ===============     =============== =============

         Weighted average basic shares outstanding           1,683          1,720               1,716            1,712
         Add:  Effect of dilutive securities
            (options)                                          140            129                 119              167
                                                     ---------------- ---------------     --------------- -------------
         Weighted average diluted shares
            outstanding                                      1,823          1,849               1,835            1,879
                                                     ================ ===============     =============== =============

         Income per share from continuing
            operations:

           Basic                                     $        0.79    $      0.64         $      2.11     $       1.77
                                                     ================ ===============     =============== =============

          Diluted                                    $        0.73    $      0.59         $      1.98     $       1.61
                                                     ================ ===============     =============== =============

</TABLE>

     Outstanding  options that were not included in the diluted income per share
     calculation  because their effect would be  anti-dilutive  totaled zero and
     61,500 for the three month periods  ended  September 30, 2003 and September
     30, 2002, respectively, and 33,667 for each of the nine month periods ended
     September 30, 2003 and September 30, 2002.


                                       7
<PAGE>

(5)  Stock-Based Compensation
     At  September  30,  2003,  the  Company  had  three  stock-based   employee
     compensation  plans.  The  Company  accounts  for  those  plans  under  the
     recognition  and  measurement  provisions  of Accounting  Principles  Board
     Opinion No. 25,  "Accounting  for Stock Issued to  Employees,"  and related
     interpretations.  No stock-based employee compensation cost is reflected in
     net income,  as all options granted under those plans had an exercise price
     equal to the market  value of the  underlying  common  stock on the date of
     grant. The following table  illustrates the effect on net income and income
     per share if the Company had applied the fair value recognition  provisions
     of FASB  SFAS  No.  123,  "Accounting  for  Stock-Based  Compensation,"  to
     stock-based employee compensation:

<TABLE>
<CAPTION>
                                                   Three Months ended September       Nine Months ended September
                                                                30,                               30,
                                                   ------------------------------    -------------------------------
                                                       2003             2002             2003              2002
                                                   -------------     ------------    -------------     -------------
                                                               (in thousands, except per share amounts)
<S>                                                <C>               <C>             <C>               <C>
     Net income, as reported                       $     1,330       $    1,097      $     3,793       $     1,558
     Deduct: Total stock-based employee
         compensation expense determined under
         fair value-based methods for all
         awards, net of tax effects
                                                           245              175              457               282
                                                   -------------     ------------    -------------     -------------
     Pro forma net income                          $     1,085       $      922      $     3,336       $     1,276
                                                   =============     ============    =============     =============
     Income per share:
         Basic - as reported                       $      0.79       $     0.64      $      2.21       $      0.91
                                                   =============     ============    =============     =============
         Basic - pro forma                         $      0.64       $     0.54      $      1.94       $      0.75
                                                   =============     ============    =============     =============

                                                   =============     ============    =============     =============
         Diluted - as reported                     $      0.73       $     0.59      $      2.07       $      0.83
                                                   =============     ============    =============     =============
         Diluted - pro forma                       $      0.60       $     0.50      $      1.82       $      0.68
                                                   =============     ============    =============     =============

</TABLE>


                                       8
<PAGE>

                       ATRION CORPORATION AND SUBSIDIARIES
                                                          9
Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations

     Results for the three months ended September 30, 2003
     Consolidated net income totaled $1.3 million,  or $0.79 per basic and $0.73
     per diluted  share,  in the third  quarter of 2003.  This is compared  with
     consolidated  net income of $1.1 million,  or $0.64 per basic and $0.59 per
     diluted  share,  in the third  quarter of 2002.  The income per basic share
     computations  are based on weighted  average  basic shares  outstanding  of
     1,683,339 in the 2003 period and  1,719,791 in the 2002 period.  The income
     per diluted share computations are based on weighted average diluted shares
     outstanding  of  1,822,881  in the 2003  period and  1,848,858  in the 2002
     period.

     Consolidated  revenues of $16.1  million for the third quarter of 2003 were
     higher than revenues of $14.7  million for the third quarter of 2002.  This
     10 percent  increase  in  revenues  for the third  quarter of 2003 over the
     third quarter of 2002 is primarily attributable to a 19 percent increase in
     the  revenues  of the  Company's  ophthalmic  products  and  an 18  percent
     increase in the revenues of the Company's  cardiovascular products. Cost of
     goods  sold of $10.3  million  for the third  quarter of 2003 was 7 percent
     higher than in the  comparable  2002 period.  The increase in cost of goods
     sold is primarily attributable to increased revenues.

     Gross profit of $5.8 million in the third quarter of 2003 was $784,000,  or
     16 percent,  higher than in the comparable 2002 period. The Company's gross
     profit percentage in the third quarter of 2003 was 36.1 percent of revenues
     compared  with 34.4 percent of revenues in the third  quarter of 2002.  The
     increase in gross profit  percentage  in the third quarter of 2003 over the
     third  quarter of 2002 is primarily  attributable  to a favorable  shift in
     product mix to products with higher gross profit margins.

     The Company's  third quarter 2003  operating  expenses of $4.0 million were
     $314,000 higher than the operating  expenses for the third quarter of 2002,
     resulting  from a $279,000  increase  in general and  administrative  (G&A)
     expenses and a $131,000 increase in selling expenses  partially offset by a
     $96,000 decrease in research and development  (R&D) expenses.  The increase
     in G&A expenses for the third quarter of 2003 is primarily  attributable to
     increases in compensation and other taxes. The increase in selling expenses
     for the  third  quarter  of 2003 is  primarily  attributable  to  increased
     advertising, travel-related expenses and bad debt expense. Operating income
     in the third quarter of 2003  increased  $470,000,  or 34 percent,  to $1.9
     million from $1.4 million in the third  quarter of 2002.  Operating  income
     margin was 11.5 percent of revenues in the third  quarter of 2003  compared
     to 9.4 percent of revenues in the third quarter of 2002. The improvement in
     operating  income is primarily  attributable  to the  previously  mentioned
     gross profit margin improvement partially offset by the increase in G&A and
     selling expenses.

     Interest  expense  for the third  quarter of 2003 was  $46,000  compared to
     interest  expense of $105,000  for the same  period in the prior year.  The
     decrease in the 2003 period from the 2002 period is primarily  attributable
     to lower interest rates and the Company's lower average  borrowing level in
     the current-year period.

     Income tax expense for the third  quarter of 2003 was $500,000  compared to
     income tax expense of $181,000  for the same period in the prior year.  The
     effective tax rate for the


                                       9
<PAGE>

     third  quarter of 2003 was 27.3 percent  compared with 14.6 percent for the
     third  quarter of 2002.  The higher  effective  tax rate is  primarily  the
     result of benefits  from tax  incentives  for exports and R&D  expenditures
     being a lesser  percentage  of taxable  income in the third quarter of 2003
     than in the third quarter of 2002.


     Results for the nine months ended September 30, 2003
     The Company's  income from continuing  operations for the nine months ended
     September  30,  2003 was $3.6  million,  or $2.11  per  basic and $1.98 per
     diluted share, compared with income from continuing operations for the nine
     months ended  September  30, 2002 of $3.0  million,  or $1.77 per basic and
     $1.61 per diluted share.  Consolidated net income,  including  discontinued
     operations  and the  cumulative  effect of change in accounting  principle,
     totaled $3.8 million,  or $2.21 per basic and $2.07 per diluted  share,  in
     the first nine months of 2003,  compared  with $1.6  million,  or $0.91 per
     basic and $0.83 per  diluted  share in the first nine  months of 2002.  The
     Company  adopted  SFAS No. 142  effective  January 1,  2002.  The  required
     adoption of SFAS No. 142 is considered a change in accounting principle and
     the cumulative effect of adopting this standard resulted in a $1.6 million,
     or $0.96 per basic and $0.87 per diluted share, non-cash,  after tax charge
     in the first quarter of 2002. The income per basic share  computations  are
     based on weighted average basic shares outstanding of 1,716,349 in the 2003
     period and  1,711,519  in the 2002  period.  The income per  diluted  share
     computations  are based on weighted  average diluted shares  outstanding of
     1,835,132 in the 2003 period and 1,878,976 in the 2002 period.

     Consolidated  revenues  of $48.0  million for the first nine months of 2003
     were  higher than  revenues  of $44.3  million for the first nine months of
     2002. This 8 percent  increase in revenues in the first nine months of 2003
     over the  first  nine  months  of 2002 is  primarily  attributable  to a 22
     percent increase in the revenues of the Company's  ophthalmic  products and
     an 11 percent  increase  in the  revenues of the  Company's  cardiovascular
     products.  Cost of goods sold of $31.0 million for the first nine months of
     2003 was 8 percent higher than in the comparable 2002 period.  The increase
     in cost of goods sold is primarily  attributable to increased  revenues and
     increased insurance costs.

     Gross  profit of $17.0  million in the first  nine  months of 2003 was $1.4
     million,  or 9 percent,  higher than in the  comparable  2002  period.  The
     Company's gross profit percentage in the first nine months of 2003 was 35.4
     percent of  revenues  compared  with 35.1  percent of revenues in the first
     nine months of 2002.  The increase in gross profit  percentage in the first
     nine  months  of 2003  over the  first  nine  months  of 2002 is  primarily
     attributable  to a favorable  shift in product mix to products  with higher
     gross profit margins.

     The Company's operating expenses of $11.7 million for the nine months ended
     September 30, 2003 were $497,000 higher than the operating expenses for the
     nine months ended September 30, 2002, resulting from a $497,000 increase in
     G&A expenses and a $93,000 increase in selling expenses partially offset by
     a $93,000  decrease  in R&D  expenses  in the first nine  months of 2003 as
     compared to the first nine months of 2002. The increase in G&A expenses for
     the nine months ended September


                                       10
<PAGE>

     30, 2003 is primarily  attributable  to increases  in  compensation,  other
     taxes and insurance  costs.  The increase in selling  expenses for the nine
     months  ended  September  30, 2003 is primarily  attributable  to increased
     compensation  and  commissions  related to  increased  revenues.  Operating
     income in the first nine months of 2003 increased $945,000,  or 22 percent,
     to $5.3  million  from  $4.3  million  in the  first  nine  months of 2002.
     Operating  income  margin was 11.0  percent of  revenues  in the first nine
     months of 2003  compared to 9.8 percent of revenue in the first nine months
     of 2002. The improvement in operating  income is primarily  attributable to
     the previously  mentioned gross profit margin improvement  partially offset
     by the increase in G&A and selling expenses.

     Interest  expense for the nine months ended September 30, 2003 was $161,000
     compared to interest  expense of $346,000  for the same period in the prior
     year.  The  decrease in the 2003  period from the 2002 period is  primarily
     attributable  to lower  interest  rates  and the  Company's  lower  average
     borrowing level in the current-year period.

     Income tax expense for the nine months  ended  September  30, 2003 was $1.6
     million  compared to income tax expense of $1.0 million for the same period
     in the prior year. The effective tax rate for the first nine months of 2003
     was 29.9  percent  compared  with 24.8 percent for the first nine months of
     2002.  The higher  effective  tax rate is primarily  the result of benefits
     from  tax  incentives  for  exports  and R&D  expenditures  being a  lesser
     percentage  of taxable  income in the first nine months of 2003 than in the
     first nine months of 2002.

     The  Company  recorded a gain on the  disposal of  discontinued  operations
     relating to the sale of its natural gas  operations of $165,000  after tax,
     or $0.10 per basic and $0.09 per diluted share,  for each of the nine month
     periods ended  September 30, 2003 and 2002,  resulting  from the receipt of
     contingent deferred payments in each year.

     Liquidity and Capital Resources
     At  September  30,  2003,  the  Company  had cash and cash  equivalents  of
     $431,000  compared  with  $353,000 at December  31,  2002.  The Company had
     borrowings of $7.5 million under its $25 million  revolving credit facility
     ("Credit Facility") at September 30, 2003 and $10.3 million at December 31,
     2002. The decrease in the outstanding  balance under the Credit Facility in
     the first nine months of 2003 is primarily  attributable  to the  Company's
     use of cash flow from  operations,  after payments for net stock purchases,
     equipment  additions  and  dividends,  to reduce its borrowing  level.  The
     Credit Facility, which expires November 12, 2004, and may be extended under
     certain  circumstances,  contains various  restrictive  covenants,  none of
     which is expected to impact the Company's  liquidity or capital  resources.
     At September  30, 2003,  the Company was in  compliance  with all financial
     covenants.

     As of September 30, 2003, the Company had working capital of $14.7 million,
     including  $431,000  in cash and cash  equivalents.  Accounts  payable  and
     accrued liabilities were the primary contributors to a $127,000 decrease in
     working  capital  during  the first  nine  months of 2003.  Cash flows from
     continuing  operations  generated  $8.4  million for the nine months  ended
     September  30, 2003 as compared to $4.6  million for the nine months  ended
     September  30,  2002.  During the first nine  months of 2003,  the  Company
     expended  $3.6 million for the addition of property and  equipment.  During
     April 2003, the Company completed a tender offer in which it purchased, for
     $4.1  million,  a total of  173,614  shares of  Common  Stock at a price of
     $23.00 per share.  The Company


                                       11
<PAGE>

     received net  proceeds of $2.2 million from the exercise of employee  stock
     options during the first nine months of 2003.

     On September 5, 2003, the Company announced that its Board of Directors had
     approved a policy for the payment of regular  quarterly  cash  dividends on
     the Company's common stock. The Company also declared a quarterly  dividend
     of $0.12 per share,  and on September  30, 2003 the Company paid  dividends
     totaling $202,000 to stockholders of record on September 15, 2003.

     The Company  believes  that its existing  cash and cash  equivalents,  cash
     flows from  operations,  borrowings  available  under the Company's  credit
     facility,  supplemented, if necessary, with equity or debt financing, which
     the Company  believes  would be  available,  will be sufficient to fund the
     Company's cash requirements for the foreseeable future.

     Forward-Looking Statements
     The  statements  in this  Management's  Discussion  and  Analysis  that are
     forward-looking are based upon current expectations, and actual results may
     differ  materially.   Therefore,  the  inclusion  of  such  forward-looking
     information  should not be regarded as a representation by the Company that
     the objectives or plans of the Company would be achieved.  Such  statements
     include,  but are not  limited  to, the  Company's  expectations  regarding
     future  liquidity  and  capital  resources.  Words  such as  "anticipates,"
     "believes," "expects," "estimated" and variations of such words and similar
     expressions are intended to identify such forward-looking statements. These
     statements involve risks and  uncertainties.  The following are some of the
     factors that could cause  actual  results to differ  materially  from those
     expressed  in  or  underlying  the  Company's  forward-looking  statements:
     changing economic, market and business conditions; market acceptance of the
     Company's products; the effects of governmental regulation;  acts of war or
     terrorism;   competition  and  new  technologies;   slower-than-anticipated
     introduction  of new products or  implementation  of marketing  strategies;
     changes in the prices or availability of raw materials;  changes in product
     mix; product  liability claims and product recalls;  the ability to attract
     and retain qualified personnel and the loss of any significant customer. In
     addition, assumptions relating to budgeting, marketing, product development
     and other  management  decisions  are  subjective in many respects and thus
     susceptible  to  interpretations  and  periodic  review which may cause the
     Company to alter its  marketing,  capital  expenditures  or other  budgets,
     which in turn may affect the Company's  results of operations and financial
     condition.

Item 4. Controls and Procedures
        -----------------------

     The management of the Company with the participation of the Company's Chief
     Executive   Officer  and  its  Chief  Financial   Officer,   evaluated  the
     effectiveness  of the Company's  disclosure  controls and  procedures as of
     September 30, 2003. Based upon this evaluation, the Chief Executive Officer
     and  Chief  Financial  Officer  concluded  that  the  Company's  disclosure
     controls and procedures  are effective in timely  alerting them to material
     information   relating  to  the   Company   (including   its   consolidated
     subsidiaries)  required to be  disclosed by the Company in the reports that
     the Company files with the Securities and Exchange Commission.


                                       12
<PAGE>

     There has been no change in the Company's  internal controls over financial
     reporting  during  the  Company's  most  recent  fiscal  quarter  that  has
     materially  affected,  or is reasonably  likely to materially  affect,  the
     Company's internal control over financial reporting.


                                       13
<PAGE>

                                     PART II

                                OTHER INFORMATION




ITEM 1.       LEGAL PROCEEDINGS
              -----------------
              None

ITEM 2.       CHANGES IN SECURITIES
              ---------------------
              None

ITEM 3.       DEFAULTS UPON SENIOR SECURITIES
              -------------------------------
              None

ITEM 4.       SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
              ---------------------------------------------------
              None

ITEM 5.       OTHER INFORMATION
              -----------------
              None

ITEM 6.       EXHIBITS AND REPORTS ON FORM 8-K
              --------------------------------
               (a)  Exhibits
                    31.1 Sarbanes-Oxley  Act Section 302  Certification of Chief
                         Executive Officer

                    31.2 Sarbanes-Oxley  Act Section 302  Certification of Chief
                         Financial Officer

                    32.1 Certification  Pursuant To 18 U.S.C.  Section  1350, As
                         Adopted Pursuant To Section 906 Of The Sarbanes - Oxley
                         Act Of 2002

                    32.2 Certification  Pursuant To 18 U.S.C.  Section  1350, As
                         Adopted Pursuant To Section 906 Of The Sarbanes - Oxley
                         Act Of 2002

               (b)  Reports on Form 8-K

                    On July 30,  2003,  the  Company  filed a Report on Form 8-K
                    with the SEC


                                       14
<PAGE>

                    regarding  the  public  dissemination  of  a  press  release
                    announcing  the  financial  results  for the second  quarter
                    ended June 30, 2003 (Item 9).

                    On September 5, 2003, the Company filed a Report on Form 8-K
                    with the SEC regarding the public  dissemination  of a press
                    release  announcing the approval of a policy for the payment
                    of quarterly dividends on the Company's common stock and the
                    declaration of a quarterly dividend. (Item 5).


                                       15
<PAGE>

                                   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.




                                  Atrion Corporation
                                     (Registrant)


         Date:  November 12, 2003                     /s/ Emile A. Battat
                                                      --------------------------
                                                      Emile A. Battat
                                                      Chairman, President and
                                                      Chief Executive Officer



         Date:  November 12, 2003                     /s/ Jeffery Strickland
                                                      --------------------------
                                                      Jeffery Strickland
                                                      Vice President and
                                                      Chief Financial Officer


                                       16