SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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FORM 10-Q

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(MARK ONE)

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

For the quarterly period ended March 31, 2002 or
 [  ]       TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM ___________ TO  _____________
Commission file number 0-12254
SCIENTIFIC TECHNOLOGIES INCORPORATED(Exact name of registrant as specified in its charter)



|Oregon                                                         | 77-0170363                             
|-------------------------------------------------------------- | ---------------------------------------
|(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification Number)

6550 Dumbarton CircleFremont, CA     94555

(510) 608-3400







Check whether the issuer (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 reports), and (2) has been subject to such filing
requirements for the past 90 days.    YES [X] NO [   ],

Common stock outstanding as of April 30, 2002 was 9,675,507 shares.









SCIENTIFIC TECHNOLOGIES INCORPORATED
                           Report On Form 10-Q For The
                           Quarter Ended March 31, 2002
                                     INDEX



|PART I.   Financial Information                                                                                       | Page No.
|--------------------------------------------------------------------------------------------------------------------- | --------
|                                                                                                                      |         
|Item 1.   Financial Statements
                  (unaudited):                                                         |         
|                                                                                                                      |         
|Consolidated Balance Sheets as of
          
     March 31, 2002 and December 31, 2001                                | **      
|                                                                                                                      |         
|Consolidated Statements of Operations for the
          
    Three Months ended March 31, 2002 and 2001               | **      
|                                                                                                                      |         
|Consolidated Statements of Cash Flows for the
          
    Three Months ended March 31, 2002 and 2001               | **      
|                                                                                                                      |         
|Notes to Consolidated Financial Statements                                                                            | **      
|                                                                                                                      |         
|Item 2.   Management's Discussion and Analysis of Financial
                      Condition and Results of Operations | **      
|                                                                                                                      |         
|Item 3.   Quantitative and Qualitative Disclosures About Market Risk                                                  | **      
|                                                                                                                      |         
|PART II.  Other Information                                                                                           |         
|                                                                                                                      |         
|Item 6.   Exhibits and Reports on Form 8-K                                                                            | **      
|                                                                                                                      |         
|Signatures                                                                                                            | **      

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PART I -- FINANCIAL INFORMATION

Item 1. Financial Statements

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SCIENTIFIC TECHNOLOGIES INCORPORATED

CONSOLIDATED BALANCE SHEET

(in thousands)

|Assets                                   | Mar. 31, 2002(unaudited) | Dec. 31, 2001
|---------------------------------------- | ------------------------ | -------------
|Current assets:                          |                          |              
|Cash and cash equivalents                | $ 758                    | $ 1,033      
|Accounts and notes receivable, net       | 7,173                    | 6,454        
|Inventories                              | 9,107                    | 9,125        
|Deferred income taxes                    | 2,081                    | 2,081        
|Receivable from Parent                   | 411                      | --           
|Other current assets                     | 568                      | 531          
|Total current assets                     | 20,098                   | 19,224       
|                                         |                          |              
|Intangible assets                        | 11,077                   | 11,389       
|Property and equipment, net
Other assets | 3,451
151                | 3,537
50     
|Total noncurrent assets                  | 14,679                   | 14,976       
|Total assets                             | $34,777                  | $34,200      

Liabilities and Shareholders' Equity

|Current liabilities:      |        
|------------------------- | -------
|Accounts payable          | $ 2,037
|Accrued expenses          | 3,281  
|Total current liabilities | 5,318  
|                          |        
|Long-term liability       | 432    
|Total liabilities         | 5,750  

Shareholders' equity:

|Common stock; $.001 par value; 100,000 shares authorized; shares issued and
outstanding - 9,676 | 10      | 10     
|----------------------------------------------------------------------------------------------- | ------- | -------
|Capital in excess of par value                                                                  | 5,637   | 5,637  
|Retained earnings                                                                               | 23,380  | 23,587 
|Total shareholders' equity                                                                      | 29,027  | 29,234 
|Total liabilities and shareholders' equity                                                      | $34,777 | $34,200
|                                                                                                |         |        
|                                                                                                |        

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

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SCIENTIFIC TECHNOLOGIES INCORPORATED

CONSOLIDATED STATEMENT OF OPERATIONS

(Unaudited, in thousands, except per share data)



|                                                                             | For the three months ended
|---------------------------------------------------------------------------- | --------------------------
|                                                                             | Mar.31, 2002              
|Sales                                                                        | $11,048                   
|                                                                             |                           
|Cost of goods sold                                                           | 6,194                     
|                                                                             |                           
|Gross profit                                                                 | 4,854                     
|                                                                             |                           
|Operating expenses:                                                          |                           
|Selling, general and administrative                                          | 3,773                     
|Research and development                                                     | 1,248                     
|Amortization of intangible assets                                            | 169                       
|Total operating expenses                                                     | 5,190                     
|                                                                             |                           
|Income (loss) from operations                                                | (336)                     
|                                                                             |                           
|Interest and other income, net                                               | 2                         
|                                                                             |                           
|Income (loss) before income taxes                                            | (334)                     
|                                                                             |                           
|Provision (benefit) for income taxes                                         | (127)                     
|                                                                             |                           
|Net income (loss)                                                            | $(207)                    
|                                                                             |                           
|Net income (loss) per common share                                           |                           
|Basic and diluted                                                            | $ (0.02)                  
|                                                                             |                           
|Shares used to compute net income (loss) per common share: Basic and
diluted | 9,676                     
|                                                                             |                           

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

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SCIENTIFIC TECHNOLOGIES INCORPORATED

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited, in thousands)



|                                                                                     | For the three months ended
|------------------------------------------------------------------------------------ | --------------------------
|                                                                                     | Mar. 31, 2002             
|                                                                                     |                           
|Cash flows from operating activities:                                                |                           
|Net income (loss)                                                                    | $ (207)                   
|Adjustments to reconcile net income (loss) to cash provided by operating
activities: |                           
|Depreciation and amortization                                                        | 651                       
|                                                                                     |                           
|Changes in assets and liabilities:                                                   |                           
|Accounts receivable, net                                                             | (719)                     
|Inventories, net                                                                     | 18                        
|Other assets                                                                         | (38)                      
|Accounts payable                                                                     | 151                       
|Payable to Parent                                                                    | (411)                     
|Accrued liabilities                                                                  | 633                       
|Cash flows provided by operating activities                                          | 78                        
|                                                                                     |                           
|Cash flows from investing activities:                                                |                           
|Purchase of property, plant and equipment                                            | (253)                     
|Investment in affiliate                                                              | (100)                     
|Sale of short-term investments                                                       | --                        
|Cash flows used in investing activities                                              | (353)                     
|                                                                                     |                           
|Change in cash and cash equivalents                                                  | (275)                     
|                                                                                     |                           
|Cash and cash equivalents at beginning of period                                     | 1,033                     
|Cash and cash equivalents at end of period                                           | $758                      

Supplemental disclosure of cash flow information:



|Cash received from (paid to) Parent for income taxes | $127 | $(356)
|---------------------------------------------------- | ---- | ------

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

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SCIENTIFIC TECHNOLOGIES INCORPORATED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The accompanying condensed consolidated financial
statements for the three months ended March 31, 2002 and 2001 are unaudited. The
accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles in the
United States of America for interim financial information and with the
instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do
not include all of the information and footnotes required by generally accepted
accounting principles in the United States of America for complete financial
statements. In the opinion of management, the unaudited condensed consolidated
financial statements reflect all adjustments, consisting only of normal
recurring adjustments, considered necessary to present fairly the financial
position, results of operations and cash flows of Scientific Technologies, Inc.
(the "Company") and its subsidiaries for all periods presented.

Management of the Company has made a number of estimates
and assumptions relating to the reporting of assets and liabilities and the
disclosure of contingent assets and liabilities to prepare these condensed
consolidated financial statements in conformity with generally accepted
accounting principles. Actual results could differ from those estimates.

The results of operations are not necessarily indicative
of the results to be expected in the future or for the full fiscal year. It is
recommended that these condensed consolidated financial statements be read in
conjunction with the Company's consolidated financial statements and the notes
thereto included in its 2001 Annual Report on Form 10-K.

1. INVENTORIES

Inventories consisted of the following:	 	(In thousands)

|                | Mar. 31, 2002 | Dec. 31, 2001
|--------------- | ------------- | -------------
|Raw Materials   | $5,427        | $5,665       
|Subassemblies   | 818           | 1,042        
|Work in Process | 658           | 475          
|Finished Goods  | 2,204         | 1,943        
|                | $9,107        | $9,125       



2. NET INCOME (LOSS) PER SHARE

A reconciliation of the numerators and denominators of the
basic and diluted income per common share computations is provided below.



|                                                  | (In thousands) |       
|------------------------------------------------- | -------------- | ------
|                                                  | Income (loss)  | Shares
|Three months ended March 31, 2002                 |                |       
|Basic earnings per share calculation              | $ (207)        | 9,676 
|Effect of dilutive securities
      Stock options | -              | -     
|Diluted earnings per share calculation            | $ (207)        | 9,676 
|Three months ended March 31, 2001                 |                |       
|Basic earnings per share calculation              | $ 580          | 9,650 
|Effect of dilutive securities
      Stock options | -              | 23    
|Diluted earnings per share calculation            | $ 580          | 9,673 

3. COMPREHENSIVE INCOME

For the three months ended March 31, 2002 and 2001, there
is no significant difference between net income and comprehensive income.

4. SEGMENT REPORTING AND OTHER INFORMATION

Financial information for each product is as follows: In
thousands



|                              | Three months ended
|----------------------------- | ------------------
|                              | March 31,         
|Safety Products               | 2002              
|Sales                         | $ 9,281           
|Group operating profit        | 99                
|                              |                   
|                              | Three months ended
|                              | March 31,         
|Automation Products           | 2002              
|Sales                         | $ 1,767           
|Group operating profit (loss) | (435)             
|                              |                   
|                              | At                
|                              | Mar. 31           
|Total Assets                  | 2002              
|Safety Products               | $13,172           
|Automation Products           | 21,605            
|Total                         | $34,777           

The Company operates principally in the United States.
The Company's operations in Germany are insignificant to the Company as a whole.
Sales to foreign customers represented less than 10% of total sales in the first
quarter of 2002.



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

This interim report on Form 10-Q contains trend analysis
and other forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Act of 1934. Such
statements include expectations, beliefs, intentions or strategies regarding
future operating results, future expenditures, future cash requirements, and
future industry conditions that involve risks and uncertainties. The Company's
actual results could differ materially from those projected in such forward-
looking statements as a result of many factors, including, without limitation,
those set forth under this section, the section entitled "Business Factors"
below and elsewhere in this report on Form 10-Q.

Results of Operations

(Amounts in thousands, except percentages)

Scientific Technologies Incorporated designs,
manufactures and distributes automation safeguarding and specialty sensor
products for the industrial control market. The Company's products include
safety light guards, profiling scanners, factory automation sensors, controls,
components, microcomputers, fiber optics, power monitoring devices, safety mats,
pressure, displacement and velocity transducers, digital pressure gauges and
comparators and other electronic equipment supplied to industrial automation,
commercial and defense customers.

Sales for the three months ended March 31, 2002 declined
23% to $11,048 from $14,323 in the comparable period in 2001. This was primarily
the result of continued sluggishness of the U.S. economy which adversely
affected markets served by both the Automation Products and Safety Products
Groups of STI, including, the capital goods, industrial automation,
semiconductor equipment and machine tooling markets. Partially offsetting the
decrease in sales resulting from the depressed economy, our consolidated sales
for the periods ended March 31, 2002 included sales by Dunn Sales Inc. (DSI)
which was acquired in June 2001.

Gross margin as a percentage of sales for the first
quarter of 2002 was 44% compared to 45% for the first quarter of 2001. The
slightly lower gross margin was primarily the result of a reduction in the
number of units sold.

Selling, general and administrative expenses for the
three months ended March 31, 2002 were reduced 5% to $3,773 from $3,988 in the
same period of 2001. The first quarter of 2002 was positively impacted by the
continuing cost reduction measures initiated in April 2001, which offset
increased selling, general and administrative expenses associated with the DSI
operations. As a percent of sales for the three months ended March 31, 2002,
selling, general and administrative expenses were 34% compared to 28% for
2001.

Research and development expenses for the first quarter
of 2002 were reduced 17% to $1,248 compared to $1,499 in the first three months
of 2002. This was also the result of the above mentioned cost reductions. As a
percent of sales for the three months ended March 31, 2002, research and
development expenses were 11% compared to 10% for the same period of 2001.



Liquidity and Capital Resources

At March 31, 2002, our working capital remained
essentially flat at $14,780 compared to $14,690 reported at December 31, 2001.

Available bank borrowings were $6,100, all of which were
unused at March 31, 2002. The Company believes that cash from operations,
together with its cash resources and available bank borrowings, will be
sufficient to fund its working capital requirements for the next twelve months.

Critical Accounting Policies

A discussion of our critical accounting policies is set
forth in our 2001 Annual Report on Form 10-K, which was filed with the
Securities and Exchange Commission on April 1, 2002, as amended. There were no
material changes in any of our critical accounting estimates or judgments during
the first quarter of 2002."

Business Factors

Because of the variety of factors and uncertainties
affecting our operating results, past financial performance and historic trends
may not be a reliable indicator of future performance. These factors, as well as
other factors affecting our operating performance, may result in significant
volatility in our common stock price. Among the factors which could affect our
future business, financial condition or operating results are the following:

Our operating results may fluctuate.

We have experienced fluctuations in annual and quarterly
operating results and anticipate that these fluctuations will continue. These
fluctuations are caused by a number of factors, including the level and timing
of customer orders, fluctuations in complementary third party products with
which our products are sold, the mix of products sold and the timing of
operating expenditures. Our operating results have been, and could continue to
be negatively impacted by generally adverse
economic conditions throughout the high technology sector. In particular, our
PSI-Tronix subsidiary has experienced decreases in sales due to the current
market conditions in the semiconductor industry.

The seasonality inherent in our business could cause our operating results
to fluctuate.

The industrial manufacturing equipment industry in which
we compete has historically been subject to seasonality. This is also true with
respect to European markets in which we compete where business activity declines
due to vacations taken in the summer months. This seasonality, combined with
other factors such as the variability in our operating results described above,
renders quarter-to-quarter comparisons of our results of operations unreliable
as indicia of our overall performance.

The market for our products is highly competitive.

The market for industrial sensors is highly competitive.
Many competitors have substantially greater name recognition and technical,
marketing and financial resources than we have. Competitive pressures could
reduce market acceptance of our products and result in price reductions,
decreased revenues and increases in expenses.

Our business could suffer if we do not respond to rapid technological
change and new product development demands of our customers.

The market for our products is characterized by rapidly
changing technology, evolving industry standards, changes in customer needs and
frequent new product introductions. Our future success will depend on our
ability to enhance current products, develop new products and respond to
emerging industry standards, all on a timely and cost-effective basis. The
introduction of new products also requires that we manage the transition from
older products in order to minimize disruption of customer orders, avoid
excessive levels of older product inventories and ensure that adequate supplies
of new products can be delivered to meet customer demands.

Our sales are dependent on indirect distribution channels.

A majority of our sales are through third party
distributors, system integrators and original equipment manufacturers. These
resellers are not required to offer our products exclusively. We cannot assure
you that a reseller will continue to offer our products. In addition many of our
resellers are privately owned firms which may not be well capitalized. If our
ability to sell products through these third parties is impaired, our results of
operations would likely suffer.

Our international sales are subject to risks.

Our international sales may be disrupted by currency
fluctuations or other events beyond our control, including political or
regulatory changes. If our international sales were disrupted for any reason,
our revenue levels would decline.

Our business could suffer if we are unable to protect and enforce our
intellectual property rights.

We rely on a combination of patent, trademark and trade
secret laws and contractual restrictions to establish and protect proprietary
rights in our products and services. There can be no assurance that our patents,
trademarks, or contractual arrangements or other steps taken by us to protect
our intellectual property will prove sufficient to prevent misappropriation of
our technology or defer independent third party development of similar
technologies. Moreover, there can be no assurance that the technology licenses
granted to us from our parent company will continue to be available. The loss of
any of our proprietary technology could require us to obtain technology of lower
quality or performance standards or at greater cost, which could materially
adversely affect our business, results of operations and financial condition.
Furthermore, the laws of certain foreign countries may not protect our products,
services or intellectual property rights to the same extent as do the laws of
the United States.



Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK.

The market risk inherent in our investments represents
the potential loss arising from adverse changes in interest rates. We are
exposed to market risk in the area of interest rate changes impacting the fair
value of our investment securities. Our policy is to invest primarily in money
market accounts and short-term investments held at financial institutions. We do
not have any derivative instruments in our investment portfolio. Due to their
highly liquid nature, our investments are subject to minimal credit and market
risk.

PART II - OTHER INFORMATION

Items 1 - 5 are not applicable for this reporting
period.



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

(a) The following documents are filed as a part of this Report:

Exhibit 3.1 - Articles of Incorporation, as amended, are incorporated by
reference to the

Registrant's Form 10-K for the year ended December 31, 1988, Exhibit
3.1.

Exhibit 3.3 - By-Laws are incorporated by reference to the Registrant's
Form 10-K for 		 the year ended December 31, 1985, Exhibit 3.

Exhibit 4.1 - 1997 Employee Stock Purchase Plan is incorporated by
reference to the 			 Registrant's Registration Statement on Form S-8
dated October 2, 1998.

Exhibit 4.2 - 1997 Stock Plan is incorporated by reference to the
Registrant's
   Registration Statement on Form S-8 dated October 2, 1998.

Exhibit 21.1 - Subsidiaries of the Registrant is incorporated by
reference to the 				 Registrant's Form 10-K for the year ended
December 31, 2001, 				 Exhibit 21.1.

Exhibit 23.1 - Consent of Independent Accountants is incorporated by
reference to 			 the Registrant's Form 10-K for the year ended December
31, 2001, 			 Exhibit 23.1.

Exhibit 24.1 - Power of Attorney is incorporated by reference to the
Registrant's Form 		 10-K for the year ended December 31, 2001, Exhibit
24.1.





1. No Reports on Form 8-K were filed during the first quarter of
2002.

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SIGNATURES

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





SCIENTIFIC TECHNOLOGIES INCORPORATED
                  Registrant

|Date: May 14, 2002 |  | /s/Joseph J. Lazzara                                                                               
|------------------ |  | ---------------------------------------------------------------------------------------------------
|                   |  | Joseph J. Lazzara                                                                                  
|                   |  | President and Chief Executive Officer
                  (Principal Executive and Financial officer)
|                   |  |                                                                                                    





|                   |  |                                                                                          
|------------------ |  | -----------------------------------------------------------------------------------------
|Date: May 14, 2002 |  | /s/ Richard O. Faria                                                                     
|                   |  | Richard O. Faria                                                                         
|                   |  | Vice-President, Finance & Administration
                  (Principal Accounting Officer)

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