FORM 10-QSB

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


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


For Quarter Ended September 30, 2001


|_|     TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

Commission File Number 1-8635

                          AMERICAN MEDICAL ALERT CORP.
        (Exact Name of Small Business Issuer as Specified in its Charter)

New York                                                  11-2571221
(State or other jurisdiction of                           (I.R.S. Employer
incorporation or organization)                            Identification Number)

                3265 Lawson Boulevard, Oceanside, New York 11572
                    (Address of principal executive offices)

                                 (516) 536-5850
                (Issuer's telephone number, including area code)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  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
           ---        ---
State the number of shares outstanding of each of the issuer's classes of common
equity,  as of the latest  practicable  date:  6,494,413 shares of common stock,
$.01 par value per share, as of November 7, 2001.


Transitional Small Business Disclosure formate (check one):

Yes        No  X
   ---        ---


<PAGE>


                  AMERICAN MEDICAL ALERT CORP. AND SUBSIDIARIES

                                   FORM 10-QSB
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2001

                                      INDEX


                                                                          PAGE
PART I.     FINANCIAL INFORMATION.
Item 1.     Report of Independent Accountants                               1

            Condensed Consolidated Balance Sheets for September 30, 2001    2
            (Unaudited) and December 31, 2000

            Condensed Consolidated Statements of Income for the             4
            Nine Months Ended September 30, 2001 and 2000 (Unaudited)

            Condensed Consolidated Statements of Income for the             5
            Three Months Ended September 30, 2001 and 2000 (Unaudited)

            Condensed Consolidated Statements of Cash Flows for the         6
            Nine Months Ended September 30, 2001 and 2000 (Unaudited)

            Notes to Condensed Consolidated Financial Statements            8

Item 2.     Management's Discussion and Analysis of
            Financial Condition and Results of Operations.                  12


PART II.    OTHER INFORMATION.
Item 1.     Legal Proceedings                                               16
Item 4.     Submission of Matters to Vote of Security Holders               16
Item 6.     Exhibits and Reports on Form 8-K                                16

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS


Board of Directors and Shareholders
American Medical Alert Corp. and Subsidiaries
Oceanside, New York

We have reviewed the condensed  consolidated  balance sheet of American  Medical
Alert Corp. and Subsidiaries as of September 30, 2001 and the related  condensed
consolidated  statements of income for the  three-month  and nine-month  periods
ended  September  30, 2001 and 2000,  and cash flows for the nine  months  ended
September 30, 2001 and 2000. These financial  statements are the  responsibility
of the company's management.

We  conducted  our  reviews in  accordance  with  standards  established  by the
American  Institute  of  Certified  Public  Accountants.  A  review  of  interim
financial  information consists principally of applying analytical procedures to
financial  data and making  inquiries of persons  responsible  for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the  expression  of an opinion  regarding the  financial  statements  taken as a
whole. Accordingly, we do not express such an opinion.

Based on our reviews, we are not aware of any material modifications that should
be made to the condensed consolidated financial statements referred to above for
them to be in conformity with accounting  principles  generally  accepted in the
United States of America.

We have  previously  audited,  in accordance with auditing  standards  generally
accepted in the United States of America,  the consolidated  balance sheet as of
December  31,  2000,  and  the  related   consolidated   statements  of  income,
shareholders'  equity  and cash  flows for the year then  ended  (not  presented
herein);  and in our report  dated April 13, 2001,  we expressed an  unqualified
opinion  on  those  consolidated  financial  statements.  In  our  opinion,  the
information set forth in the accompanying  condensed  consolidated balance sheet
as of December 31, 2000, is fairly stated, in all material respects, in relation
to the consolidated balance sheet from which it has been derived.


/s/Margolin, Winer & Evens LLP

Margolin Winer & Evens LLP

November 7, 2001


                                       -1-
<PAGE>

                          PART I FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS.

<TABLE>
<CAPTION>
                  AMERICAN MEDICAL ALERT CORP. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

                                     ASSETS
                                                                          September 30,2001
                                                                              (Unaudited)        Dec 31,2000*
                                                                          -----------------      ------------
<S>                                                                          <C>                <C>
CURRENT ASSETS
     Cash                                                                    $   684,157        $   537,247
     Accounts and notes receivable
       (net of allowance for doubtful accounts of $377,500 and $300,000)       2,910,704          2,850,756
     Notes and other receivables                                                 236,623            219,971
     Inventory                                                                   207,068            154,880
     Prepaid and refundable taxes                                                436,315            601,478
     Prepaid expenses and other current assets                                   167,249             98,859
     Deferred income tax benefit                                                 309,000            309,000
                                                                             -----------        -----------
     Total Current Assets                                                      4,951,116          4,772,191
                                                                             -----------        -----------
INVENTORY OF MEDICAL DEVICES HELD FOR LEASE - AT COST                          1,206,179          1,886,016
FIXED ASSETS                                                                 -----------        -----------
     (Net of accumulated depreciation and amortization)                        6,640,361          6,707,226
                                                                             -----------        -----------
OTHER ASSETS
     Long-term portion of notes receivable                                       241,188            196,428
     Intangible assets and deferred charges
       (net of accumulated amortization of $393,312 and $209,438)              1,416,350          1,502,375
     Other assets                                                                 71,548             69,597
                                                                             -----------        -----------
                                                                               1,729,086          1,768,400
                                                                             -----------        -----------

TOTAL ASSETS                                                                 $14,526,742        $15,133,833
                                                                             ===========        ===========
LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
     Current portion of long term debt                                       $ 1,336,428        $   247,839
     Accounts payable                                                          1,088,362          1,077,168
     Accrued expenses                                                            467,219            791,053
     Current portion of capital lease obligations                                209,880            179,565
     Deferred revenue                                                             57,823            163,357
                                                                             -----------        -----------
     Total Current Liabilities                                                 3,159,712          2,458,983

DEFERRED INCOME TAX LIABILITY                                                    507,000            507,000
LONG-TERM PORTION OF NOTES PAYABLES                                              631,670          2,107,843
LONG-TERM PORTION OF CAPITAL LEASE OBLIGATIONS                                   235,402            308,721
PUT WARRANT OBLIGATION                                                           249,000            189,000
DEFERRED GAIN ON SALE OF EQUIPMENT                                                 7,366             11,566
                                                                             -----------        -----------
     TOTAL LIABILITIES                                                         4,790,150          5,583,113

</TABLE>


                                       -2-
<PAGE>

<TABLE>
<CAPTION>
<S>                                                                          <C>                <C>
COMMITMENTS AND CONTINGENT LIABILITIES                                                 --                --

SHAREHOLDERS' EQUITY
     Preferred stock, $ .01 par value - authorized, 1,000,000 shares;
        none issued and outstanding
     Common stock, $.01 par value - authorized, 20,000,000 shares
        issued 6,494,413 and 6,459,151 shares in 2001 and 2000,
        respectively                                                         $     64,944       $    64,580
     Additional paid-in capital                                                 6,333,222         6,265,939
     Retained earnings                                                          3,444,458         3,326,233
                                                                             ------------      ------------
                                                                                9,833,624         9,656,752
     Less 43,910 shares of treasury stock, at cost                               (106,032)         (106,032)
                                                                             ------------      ------------
     Total Shareholders' Equity                                                 9,736,592         9,550,720
                                                                             ------------      ------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                                   $ 14,526,742      $ 15,133,833
                                                                             ============      ============
</TABLE>

See accompanying notes to condensed financial statements.

     * Derived from audited financial statements, with a reclassification
       to conform to September 30, 2001 presentation

                                       -3-
<PAGE>
<TABLE>
<CAPTION>

                  AMERICAN MEDICAL ALERT CORP. AND SUBSIDIARIES

                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)

                                                                    Nine Months Ended September 30,
                                                                    -------------------------------
                                                                         2001              2000
                                                                         ----              ----
<S>                                                                <C>               <C>
Revenues:
         Services                                                  $  9,994,821      $  7,432,917
         Product sales                                                  267,921           243,245
                                                                   ------------      ------------
                                                                     10,262,742         7,676,162
                                                                   ------------      ------------

Cost and Expenses (Income):
         Costs related to services                                    4,963,588         3,364,427
         Costs of products sold                                         168,522           172,999
         Selling, general and administrative expenses                 4,829,944         3,799,757
         Write-off of deferred costs                                         --           329,009
         Interest expense                                               174,418            85,377
         Other income                                                   (81,693)          (21,878)
                                                                   ------------      ------------
                                                                     10,054,779         7,729,691
                                                                   ------------      ------------

Income (loss) before Provision for Income Taxes                         207,963           (53,529)

         Provision (credit) for Income Taxes                             89,738           (29,000)
                                                                   ------------      ------------

NET INCOME (LOSS)                                                  $    118,225      $    (24,529)
                                                                   ============      ============

Net Income (loss) per Share:
         Basic                                                     $        .02      $         -0-
                                                                   ------------      ------------
         Diluted                                                   $        .02      $         -0-
                                                                   ------------      ------------

Weighted average number of common shares outstanding (Note 3):
         Basic                                                        6,427,303         6,411,760
                                                                   ============      ============
         Diluted                                                      6,573,775         6,411,760
                                                                   ============      ============

See accompanying notes to condensed financial statements
</TABLE>


                                       -4-
<PAGE>

<TABLE>
<CAPTION>
                  AMERICAN MEDICAL ALERT CORP. AND SUBSIDIARIES

                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)

                                                                    Three Months Ended September 30,
                                                                    --------------------------------
                                                                        2001            2000
                                                                        ----            ----
<S>                                                                <C>              <C>
Revenues:
         Services                                                  $ 3,451,025      $ 2,515,844
         Product sales                                                  66,769           55,081
                                                                   -----------      -----------
                                                                     3,517,794        2,570,925
                                                                   -----------      -----------

Cost and Expenses (Income):
         Costs related to services                                   1,706,621        1,253,507
         Costs of products sold                                         43,885           27,165
         Selling, general and administrative expenses                1,551,881        1,360,516
         Write-off of deferred costs                                        --          329,009
         Interest expense                                               52,847           47,302
         Other income                                                  (23,365)          (5,391)
                                                                   -----------      -----------
                                                                     3,331,869        3,012,108
                                                                   -----------      -----------

Income (loss) before Provision for Income Taxes                        185,925         (441,183)

         Provision (credit) for Income Taxes                            79,705         (191,000)
                                                                   -----------      -----------

NET INCOME (LOSS)                                                  $   106,220      $  (250,183)
                                                                   ===========      ===========

Net Income (loss) per Share
         Basic                                                     $       .02      $      (.04)
                                                                   -----------      -----------
         Diluted                                                   $       .02      $      (.04)
                                                                   -----------      -----------

Weighted average number of common shares outstanding (Note 3):
         Basic                                                       6,449,186        6,414,111
                                                                   -----------      -----------
         Diluted                                                     6,520,644        6,414,111
                                                                   -----------      -----------

See accompanying notes to condensed financial statements.
</TABLE>


                                       -5-
<PAGE>

<TABLE>
<CAPTION>

                  AMERICAN MEDICAL ALERT CORP. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

                                                                          Nine Months Ended September 30,
                                                                          -------------------------------
                                                                               2001              2000
                                                                               ----              ----
<S>                                                                        <C>             <C>
Cash Flows from Operating Activities:
         Net income                                                        $   118,225      $   (24,529)
         Adjustments to reconcile net income to
             net cash provided by operating activities
           Depreciation and amortization                                     1,492,059        1,277,444
           Valuation of Put Warrants                                            60,000               --
           Loss on unrecovered leased medical equipment                         97,681           88,928
           Decrease (Increase) in:
             Accounts receivable                                               (59,948)        (431,184)
             Inventory                                                         (52,189)          62,012
             Prepaid and refundable taxes                                      165,163               --
             Prepaid expenses and other assets                                 (70,342)        (157,392)
           Increase (Decrease) in:
             Accounts payable and accrued expenses                            (316,840)         484,282
             Deferred Revenue                                                 (105,534)              --
                                                                           ------------      -----------

Net Cash Provided by Operating Activities                                    1,328,275        1,299,561
                                                                           ------------      -----------

Cash Flows from Investing Activities:
           Expenditures for fixed assets net of utilization of medical
           devices held for lease                                             (560,824)      (2,950,892)
           Proceeds from sale and leaseback of equipment                            --          250,179
           Increase in notes receivable                                       (140,000)        (219,582)

           Repayment of notes receivable                                        78,589               --

           Payment for account acquisitions and goodwill                       (97,848)        (376,779)
                                                                           ------------      -----------

Net Cash Used In Investing Activities                                         (720,083)      (3,297,074)
                                                                           ------------      -----------

Cash Flows from Financing Activities:
           Increase in notes payable - bank                                         --        1,300,000
           Principal payments under capital lease obligation                  (141,373)              --
           Proceeds from (repayment of) loans payable                           17,898         (106,520)
           Repayment of notes payable                                         (405,454)              --
           Net proceeds upon exercise of stock options                          67,647           26,666
                                                                           ------------      -----------

Net Cash (Used In) Provided by Financing Activities                           (461,282)       1,220,146
                                                                           ------------      -----------

Net Increase (Decrease) in Cash                                                146,910         (777,367)
Cash, Beginning of Period                                                      537,247          953,734
                                                                           ------------      -----------
Cash, End of Period                                                        $   684,157      $   176,367
                                                                           ===========      ===========

See accompanying notes to condensed financial statements
</TABLE>

                                       -6-
<PAGE>


<TABLE>
<S>                                                                       <C>               <C>
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
          Interest                                                         $   169,031      $    85,377
          Income Taxes                                                     $   149,306      $   231,646

</TABLE>

SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITY:

  During 2001 the Company incurred capital lease obligations of
  $98,340 when it entered into a lease agreement for new equipment.

See accompanying notes to condensed financial statements



                                       -7-
<PAGE>


                  AMERICAN MEDICAL ALERT CORP. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                                   (Unaudited)

1.      General:

          These  financial  statements  should be read in  conjunction  with the
financial  statements  and notes  thereto for the year ended  December  31, 2000
included in the Company's Annual Report on Form 10-KSB.

2.      Results of Operations:

          In the opinion of management,  the  accompanying  unaudited  condensed
financial  statements  contain  all  adjustments   (consisting  only  of  normal
recurring  accruals)  necessary to present  fairly the financial  position as of
September 30, 2001,  and the results of  operations  and cash flows for the nine
and three months ended September 30, 2001 and 2000.

          The accounting  policies used in preparing these financial  statements
are the same as those described in the December 31, 2000 financial statements.

          The  results  of  operations  for the  nine  and  three  months  ended
September 30, 2001 are not necessarily  indicative of the results to be expected
for any other interim period or for the full year.

3.      New Pronouncements

          In July 2001, the Financial Accounting Standards Board issued SFAS No.
142,  "Goodwill  and Other  Intangible  Assets" which states that Goodwill is no
longer to be  amortized,  but  instead is to be tested for  impairment  at least
annually. The impairment process will consist of comparing the fair value of the
intangible  asset to its carrying  value.  The Company  shall adopt SFAS No. 142
effective January 1, 2002. The impact of SFAS No. 142 on the Company's financial
statements, if any, has not yet been determined.

4.      Earnings Per Share

          In February 1997, the Financial Accounting Standards Board issued SFAS
No. 128,  "Earnings  per Share" which  changes the  methodology  of  calculating
earnings per share. SFAS No. 128 requires the disclosure of diluted earnings per
share  regardless of its difference  from basic earnings per share.  The Company
adopted SFAS No. 128 in December 1997.  Earnings per share data for the nine and
three months ended  September 30, 2001 and 2000 is presented in conformity  with
this pronouncement.

          The  following  table  is  a  reconciliation  of  the  numerators  and
denominators in computing earnings per share:

                                       -8-

<PAGE>

<TABLE>

Nine Months Ended September 30, 2001                  Income             Shares               Per-Share
------------------------------------                (Numerator)       (Denominator)            Amounts
                                                    -----------       -------------            -------
<S>                                                <C>                  <C>                   <C>
Basic EPS -
Income available to common stockholders            $ 118,225             6,427,303            $    .02
Effect of dilutive securities -
  Options and warrants                                   -0-               146,472
                                                   ---------             ---------            --------
Diluted EPS - Income available to
  common stockholders and assumed
  conversions                                      $ 118,225             6,573,775            $    .02
                                                   =========             =========            ========

Three Months Ended September 30, 2001
------------------------------------
Basic EPS -  Income available to
  common stockholders                              $ 106,220             6,449,186            $    .02
Effect of dilutive securities -
  Options and warrants                                    -0-               71,459
                                                   ---------             ---------
Diluted EPS - Income available to
  common stockholders and assumed
  conversions                                      $ 106,220             6,520,644            $    .02
                                                   =========             =========            ========

Nine months Ended September 30, 2000
------------------------------------
Basic EPS -(Loss) available to common
  Stockholders                                     $ (24,529)            6,411,760            $    .00
Effect of dilutive securities -
  Options and warrants                                    -0-                   -0-
                                                   ---------             ---------
Diluted EPS -(Loss) available to
  common stockholders and
  assumed conversions                              $ (24,529)            6,411,760            $    .00
                                                   =========             =========            ========

Three Months Ended September 30, 2000
-------------------------------------
Basic EPS - (Loss) available to
  common stockholders                              $(250,183)            6,414,111            $   (.04)
Effect of dilutive securities -
  Options and warrants                                    -0-                   -0-
                                                   ---------             ---------
Diluted EPS -(Loss) available to
  common stockholders and assumed
  conversions                                      $(250,183)            6,414,111            $   (.04)
                                                   =========             =========            ========
</TABLE>

                                       -9-
<PAGE>

5.      Major Customers:

          The Company  provides  services to Medicaid home care programs in over
ten states. During the three months and nine months ended September 30, 2001 and
2000  the  Company  had  revenue  from  the City of New  York,  Human  Resources
Administration,   Home  Care  Services  Program   ("HCSP")  which   represented,
respectively,  26% and 27% of total  revenue in the 2001  periods and 37% of the
total revenue in the 2000 periods. The contract,  which was previously effective
through June 30, 1999, was extended through December 31, 2000. In June 1999, the
Company  submitted its proposal to HCSP to renew and extend the contract.  Since
June 30, 1999,  the Company has  continued  to provide  service  while  awaiting
HCSP's  selection of a provider  under the new contract.  As of November 7, 2001
the City of New York is still evaluating the subject award. In the meantime, the
Company  continues  to  service  its  customers  under the terms of the  expired
contract through various retroactive extensions granted by the City of New York.
The City of New York has advised the Company that an extension of the  contract,
under the same terms and conditions, is being processed which if executed by the
City of New York will extend the contract through June 30, 2002.

There can be no  assurance  that the  Company  will be able to sustain  the same
level of revenues  from the  provision of services to HCSP,  due to a variety of
factors,  including  the  terms  and  conditions  of any  renewal  or  extension
contracts with HCSP,  pricing and the number of subscribers to be serviced under
such  contracts.  While the Company has reduced its  dependence  on revenue from
HCSP, a significant amount of the Company's revenue could be lost, albeit over a
protracted  period, if the contract with HCSP is not maintained or is maintained
at a significantly  lower level of revenue.  This could have a material  adverse
effect on operating results, and in such event, there could be a write-down of a
number of the  Company's  leased  medical  devices  (and/or a reduction in their
remaining  useful  lives) and  medical  devices  held for lease.  The extent and
significance  of the  write  down  will be  dependent  upon  the  length  of the
transition  period to the new provider subject to management's  ability to place
these  devices with other  providers.  As of September 30, 2001 and December 31,
2000,   accounts   receivable  from  the  contract   represented  52%  and  57%,
respectively,  of accounts  receivable,  and leased  medical  devices in service
under the contract  represented  26% and 31%,  respectively,  of leased  medical
devices.


6.      Segment Reporting:

The Company has two reportable  segments,  Personal  Emergency  Response Systems
("PERS") and Telephone After-Hours Answering Services ("TAS"), which is provided
through the  Company's  HCI  subsidiary,  which  acquired  the assets of Harriet
Campbell Inc. on November 21, 2000.

The table  below  provides  a  reconciliation  of segment  information  to total
consolidated information for the nine and three months ended September 30, 2001:


                                      -10-
<PAGE>

<TABLE>

                                                     PERS               TAS               Other            Consolidated
                                                     ----               ---               -----            ------------
Nine Months Ended September 30, 2001
------------------------------------
<S>                                             <C>                <C>                <C>                  <C>
Revenue                                          $ 8,503,620        $ 1,692,624        $    66,498         $10,262,742
Income (loss) before provision for income
taxes                                                 30,706            208,964            (31,707)            207,963
Total assets                                      12,471,935          1,889,301            165,506          14,526,742



                                                     PERS               TAS                Other           Consolidated
                                                     ----               ---                -----           ------------
Three Months Ended September 30, 2001
-------------------------------------

Revenue                                          $ 2,879,482        $   613,659        $    24,653         $ 3,517,794
Income (loss) before provision for
income taxes                                          94,137            103,820            (12,032)            185,925

</TABLE>

                                      -11-
<PAGE>


7.      Contingencies:

          Although  the  Company  is  a  party  to  certain  routine  litigation
incidental  to its  business,  the Company  believes  that,  except as set forth
below, there are no material pending legal proceedings to which it is a party or
to which any of its properties are subject.

          On March 2, 2001  American  Medical  Alert  Corp.  was  served  with a
Summons  and  Complaint  by a former  employee  seeking to recover  damages  for
discrimination  and harassment in connection with her employment and the alleged
termination  thereof.  The  action is  pending  in the  Supreme  Court of Queens
County.  The  plaintiff  seeks to recover the sum of $750,000  for  compensatory
damages and  $750,000  for  punitive  damages.  Based on advice of counsel,  the
Company  believes  that it has  meritorious  defenses to the  complaint.  At the
present time the  Company's  insurance  company has declined  coverage  although
efforts to obtain a reversal of the declination of coverage are ongoing.

8.      Subsequent Events:

          On November 1, 2001, the Company entered into a Cooperative Licensing,
Development,  Services and Marketing  Agreement  with Health Hero Network,  Inc.
(the  "Agreement")  in  which  the  parties  agreed  to an  exclusive  strategic
alliance.  Pursuant  to  the  Agreement,  the  Company  will  be  the  exclusive
manufacturer and distributor,  in the United States,  of an enhanced PERS system
that  combines the  Company's  traditional  safety  monitoring  features with an
internet based disease  management  monitoring  technology.  The Agreement has a
minimum  five year term,  and also  provides  for the  payment by the Company of
certain royalty fees based on the service revenue derived from the enhanced PERS
product. The Agreement has certain development and financing  requirements to be
met within 90 days of the execution of the Agreement. In addition, the Company's
exclusivity  is subject to achievement  of certain sales  milestones  during the
term of the  Agreement.  Upon  execution  of the  Agreement,  the Company made a
$100,000  non-refundable  payment.  The Company anticipates the costs associated
with the licensing,  research and development and marketing with respect to this
Agreement to exceed $2 million over 12-18  months,  and the Company is currently
reviewing possible sources of financing.

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

The following  discussion and analysis  provides  information  which  management
believes is relevant to an assessment and understanding of the Company's results
of  operations  and  financial  condition.  The  discussion  should  be  read in
conjunction with the consolidated  financial  statements contained in the latest
Annual Report dated December 31, 2000.

This  discussion  contains  forward-looking  statements  which,  in  addition to
assuming a  continuation  of the degree and timing of customer  utilization  and
rate of renewals of contracts with the Company at historical levels, are subject
to a number of known and unknown  risks that,  in addition to general  economic,
competitive  and  other  business   conditions,   could  cause  actual  results,
performance  and  achievements  to differ  materially  from those  described  or
implied  in  the  forward-looking  statements.  The  risk  factors  are  further
discussed with the Company's filings with the Securities Exchange Commission.


                                      -12-
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

The Company has an amended $1,700,000 Revolving Credit Facility (the "Facility")
with a bank  expiring  May  31,  2002  (based  upon  75%  of  eligible  accounts
receivable and 50% of inventory, as defined in the agreement with respect to the
Facility). Borrowings under the Facility bear interest at the lower of the prime
rate or the  LIBOR  Rate  plus  2.50% and are  collateralized  by the  Company's
assets. There was $1,100,000  outstanding under the Facility as of September 30,
2001 and November  10, 2001,  respectively.  The  agreement  with respect to the
Facility provides for negative and affirmative covenants including those related
to tangible net worth,  working  capital and other  borrowings.  At December 31,
2000 there was $1,300,000 outstanding under the Facility.

The Company's  working  capital on September 30, 2001 was $1,791,404 as compared
to $2,313,208 on December 31, 2000. During 2001, the Company anticipates that it
will make capital investments of approximately $1,000,000 of which approximately
$625,000 was expended during the first six months of the year.

The Company derives a significant  portion of its revenue from one contract with
the City of New York's Human Resources  Administration  (HRA), Medicaid Homecare
Services Program (HCSP). During the three months and nine months ended September
30,  2001 and 2000 the  Company  had  revenue  from the City of New York,  Human
Resources Administration, Home Care Services Program ("HCSP") which represented,
26% and 27% of total revenue in the 2001 periods and 37% of the total revenue in
the 2000  periods.  As of September  30, 2001 and  December  31, 2000,  accounts
receivable from the contract represented 52% and 57%, respectively,  of accounts
receivable.  Leased  medical  devices  in  service  relating  to  this  contract
represented  26% and 31%,  respectively,  of total  leased  medical  devices  at
September  30, 2001 and  December 31, 2000.  The contract  with HCSP  originally
expired on June 30,  1999.  In January  1999,  the  Company  and  several  other
companies  submitted  proposals  to the  City of New  York to be  awarded  a new
contract through June 30, 2003.

On October 22, 1999,  the Company was advised by HCSP that  another  company had
been  preliminarily  recommended.   The  Company's  management  reviewed  HCSP's
preliminary  recommendation  and  assessed  alternative  options  and courses of
action.  On November 1, 1999, the Company submitted a formal protest pursuant to
paragraph 4-04 of the Rules of the  Procurement  Policy Board of the City of New
York to contest the preliminary  award. While the protest was ultimately denied,
as of August 10, 2001, the contract had not been awarded.  In the meantime,  the
Company  continues  to  service  its  customers  under the terms of the  expired
contract through various retroactive extensions granted by the City of New York,
the  last of which  was  through  December  31,  2000.  The City of New York has
advised the Company that an extension of the contract,  under the same terms and
conditions,  is being  processed  which if executed by the City of New York will
extend the contract through June 30, 2002.

If the City of New York HCSP awards the  contract to another  vendor,  or if the
level of revenues is not maintained under any renewed or extended  contract with
HCSP, a significant  amount of the Company's revenues could be lost, albeit over
a protracted period, having a material adverse effect on operating results. With
the potential loss of up to approximately  27% of the

                                      -13-

<PAGE>

Company's revenues,  cash flow from operations could be adversely  affected.  In
addition,  it is  possible  that  adjustments  to  inventory  and  fixed  assets
associated  with the contract would occur,  and the Company could,  depending on
the  severity of the lost  revenue,  be required to  implement  additional  cost
cutting measures.

In light of the above factors with respect to the Company's  contract with HCSP,
the Company's  management  developed and implemented in 2000, a business plan to
reduce reliance on the HCSP contract through diversification of revenue sources.
As a  result,  the  Company's  dependence  on HCSP as a source  of  revenue  has
decreased,  as a percentage of total revenue,  to 27% in 2001,  from 36% in 2000
and 46% in 1999.  The Company  continues to focuses on building  its  subscriber
base through consumers,  healthcare agencies, health maintenance  organizations,
durable medical equipment providers, retirement communities, hospitals and other
governmental  agencies. In addition,  the Company is continuing to invest in new
products, services and initiatives.

On  November  1,  2001,  the  Company  entered  into  a  Cooperative  Licensing,
Development,  Services and Marketing  Agreement  with Health Hero Network,  Inc.
(the  "Agreement")  in  which  the  parties  agreed  to an  exclusive  strategic
alliance.  Pursuant  to  the  Agreement,  the  Company  will  be  the  exclusive
manufacturer and distributor,  in the United States,  of an enhanced PERS system
that  combines the  Company's  traditional  safety  monitoring  features with an
internet based disease  management  monitoring  technology.  The Agreement has a
minimum  five year term,  and also  provides  for the  payment by the Company of
certain royalty fees based on the service revenue derived from the enhanced PERS
product. The Agreement has certain development and financing  requirements to be
met within 90 days of the execution of the Agreement. In addition, the Company's
exclusivity  is subject to achievement  of certain sales  milestones  during the
term of the  Agreement.  Upon  execution  of the  Agreement,  the Company made a
$100,000  non-refundable  payment.  The Company anticipates the costs associated
with the licensing,  research and development and marketing with respect to this
Agreement to exceed $2 million over 12-18  months,  and the Company is currently
reviewing possible sources of financing.


RESULTS OF OPERATIONS
---------------------

Revenue from services,  monthly recurring revenue ("MRR"),  increased $2,561,904
for the nine months ended  September  30, 2001 as compared to the same period in
2000,  an increase of 34%,  and  increased  $935,181  for the three months ended
September  30, 2001 as compared to the same period in 2000,  an increase of 37%.
For the nine months ended  September 30, 2001 the Company  recorded  revenues of
approximately $1,700,000 from its wholly owned subsidiary, HCI Acquisition Corp.
("HCI"),  which  acquired the assets of Harriet  Campbell Inc. in November 2000.
The Company has  experienced  success in growing its customer  base for its PERS
system, its core product, outside its contract with the City of New York through
a variety of marketing  efforts that have  continued to contribute to increasing
MRR. These efforts include expansion into new regions,  competitive conversions,
strategic  partnerships with healthcare  provider systems,  and additional entry
into Medicaid reimbursed marketplaces.

Costs  related to services  increased  by  $1,599,161  for the nine months ended
September  30, 2001 as  compared to the same period in 2000,  an increase of 48%
and increased $453,114 for the three months ended September 30, 2001 as compared
to the same period in 2000, an increase of 36%.

                                      -14-

<PAGE>


Costs  related to services,  as a percentage of service  revenues,  for the nine
months ended September 30, 2001 and 2000 were 50% and 45%, respectively. For the
nine months  ended  September  30, 2001 the Company  recorded  costs  related to
services of approximately  $725,000 from HCI. The costs related to services also
increased due to employing  additional  response  center  personnel,  additional
depreciation  and  amortization   expenses,   and  certain  fixed  and  variable
production  costs being  expensed as a result of the limited  production of PERS
during the nine  months  ended  September  30,  2001.  Such  limited  production
resulted  from the  Company's  utilization  of its  inventory of leased  medical
devices held for lease as of December 31, 2000.

Selling,  general and  administrative  expenses  increased by $1,030,187 for the
nine months ended  September 30, 2001 as compared to the same period in 2000, an
increase of 27%. Selling,  general, and administrative expenses as compared as a
percentage  of total  revenues for the nine months ended  September 30, 2001 and
2000  were  47% and  50%,  respectively.  Selling,  general  and  administrative
expenses  increased by $191,365 for the three months ended September 30, 2001 as
compared to the same period in 2000, an increase of 14%. Selling,  general,  and
administrative  expenses as compared as a percentage  of total  revenues for the
three months ended  September  30, 2001 and 2000 were 44% and 53%  respectively.
For the nine months  ended  September  30, 2001 the  Company  recorded  selling,
general  and  administrative   expenses  of  approximately  $720,000  from  HCI.
Additional  expenses were the result of increased legal,  excluding the writeoff
of  deferred  costs,  and  accounting  fees  incurred  in  2001,  as well as the
employment of additional executive and management personnel.

Interest  expense  for the nine  months  ended  September  30, 2001 and 2000 was
$174,418 and $85,377, respectively.  Interest expense for the three months ended
September  30,  2001 and 2000 was $52,847 and  $47,302,  respectively.  Interest
expense  increased due to additional  borrowings  throughout 2000 needed to fund
increased  production of units and  equipment  needs for new  subscribers,  fund
management systems, and the acquisition by HCI of the assets of Harriet Campbell
Inc. Such  additional  borrowings were not outstanding for the nine months ended
September 30, 2000 but were outstanding as of September 30, 2001.

The Company's income before provision for income taxes for the nine months ended
September 30, 2001 was $207,963, a increase of $261,492 from 2000. The Company's
income before  provision  for income taxes for the three months ended  September
30, 2001 was $185,925 an increase of $627,108 from 2000.  The increase in profit
of  $261,492  for the nine  months  ended  September  30, 2001 was the result of
incurring a one-time  charge for the  writeoff of deferred  costs of $329,009 in
2000,  that was not  incurred  in 2001,  plus the affect of  increased  revenues
offset by additional expenses.

NEW PRONOUNCEMENTS
------------------

In July 2001,  the  Financial  Accounting  Standards  Board issued SFAS No. 142,
"Goodwill and Other  Intangible  Assets" which states that Goodwill is no longer
to be amortized,  but instead is to be tested for impairment at least  annually.
The  impairment  process  will  consist  of  comparing  the  fair  value  of the
intangible  asset to its carrying  value.  The Company  shall adopt SFAS No. 142
effective January 1, 2002. The impact of SFAS No. 142 on the Company's financial
statements, if any, has not yet been determined.


                                      -15-
<PAGE>


                           PART II. OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS.

Although the Company is a party to certain routine litigation  incidental to its
business,  the Company  believes that,  except as set forth below,  there are no
material pending legal proceedings to which it is a party or to which any of its
properties are subject.

On March 2, 2001  American  Medical  Alert  Corp.  was served with a Summons and
Complaint by a former employee seeking to recover damages for discrimination and
harassment  in  connection  with  her  employment  and the  alleged  termination
thereof.  The action is  pending  in the  Supreme  Court of Queens  County.  The
plaintiff  seeks to recover the sum of  $750,000  for  compensatory  damages and
$750,000 for punitive damages.  Based on advice of counsel, the Company believes
that it has  meritorious  defenses to the  complaint.  At the  present  time the
Company's  insurance  company has declined coverage although efforts to obtain a
reversal of the declination of coverage are ongoing.


ITEM 4. SUBMISSION OF MATTER TO A VOTE OF SECURITY HOLDERS.

          On August  16,  2001,  the  Company  held its 2001  Annual  Meeting of
Shareholders (the "2001 Meeting").

At the 2001 Meeting,  the Company's  Shareholders elected six directors to serve
until the 2002 Annual Meeting of Shareholders  and until their  successors shall
be  elected  and  qualified.  The vote  with  respect  to the  election  of such
directors was as follows:

              NAME                    FOR             AUTHORITY WITHHELD
              ----                    ---             ------------------

(a)      Howard M. Siegel          5,227,336               162,211
(b)      Theodore Simon            5,227,136               162,411
(c)      James LaPolla             5,226,836               162,711
(d)      Frederick Siegel          5,227,336               162,211
(e)      Ronald Levin              5,227,136               162,411
(f)      Yacov Shamash             5,227,136               162,411


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

(a)       Exhibits:

10.1      Cooperative Licensing,  Development,  Services and Marketing Agreement
          dated as of  November  1, 2001,  by and between the Company and Health
          Hero Network, Inc.

(b)       Reports on Form 8-K:


                                      -16-
<PAGE>


          On August  16,  2001 the  Company  filed a Current  Report on Form 8-K
relating to Item 5, Other  Events,  reporting  the  issuance of a press  release
relating to the Company's  contract with the City of New York,  Human  Resources
Administration, Home Care Services Program.

          On  November 5, 2001 the  Company  filed a Current  Report on Form 8-K
relating to Item 5, Other  Events,  reporting  the  issuance of a press  release
announcing an exclusive  strategic  alliance agreement with Health Hero Network,
Inc.



                                      -17-
<PAGE>


                                   SIGNATURES


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




                                    AMERICAN MEDICAL ALERT CORP.




Dated: November 14, 2001             By:   /s/ Howard M. Siegel
                                           -------------------------------------
                                           Howard M. Siegel
                                           President and Chief Executive Officer



                                     By:   /s/ Richard Rallo
                                           -------------------------------------
                                           Richard Rallo
                                           Controller

                                      -18-
<PAGE>




                                  EXHIBIT INDEX

Exhibit No.    Description
-----------    -----------

10.1*          Cooperative  Licensing,   Development,   Services  and  Marketing
               Agreement, dated November 1, 2001, between the Company and Health
               Hero Network, Inc.

















*  Portions of the exhibit have been omitted pursuant to a request for.
confidential treatment.


                                      -19-