UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                          -----------------------------

                                   FORM 10-QSB

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


April 30, 1997                                              0-11088
For the quarterly period ended                           Commission file number

                              ALFACELL CORPORATION
             (Exact name of registrant as specified in its charter)



Delaware                                                             22-2369085
(State or other jurisdiction of                                   (IRS Employer
incorporation or organization)                               Identification No.)

               225 Belleville Avenue, Bloomfield, New Jersey 07003
                    (Address of principal executive offices)
                                 (973) 748-8082
                           (Issuer's telephone number)

                                 NOT APPLICABLE
        (Former name, former address, and former fiscal year, if changed
                               since last report)



Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days. Yes X No


State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:

Common shares outstanding as of June 2, 1997:    14,837,843

Transitional small business disclosure format (check one):    Yes       No   X



<PAGE>
                              ALFACELL CORPORATION
                          (A Development Stage Company)

Part I.  Financial Information
Item 1.  Financial Statements

                                 BALANCE SHEETS
                        April 30, 1997 and July 31, 1996

<TABLE>
<CAPTION>

                                                                                 April 30,              July 31,
                                            ASSETS                                1997                    1996
                                            ------                                -----                   ----
                                                                               (Unaudited)
Current assets:
<S>                                                                         <C>                    <C>          
         Cash and cash equivalents                                          $    8,322,572         $   8,131,442
         Loan receivable, related party                                              -                   112,250
         Prepaid expenses                                                          201,543                63,850
                                                                                   -------                ------
                  Total current assets                                           8,524,115             8,307,542
                                                                                 ---------             ---------

Property and equipment, net of accumulated depreciation and amortization
of $722,913 at April 30, 1997 and $688,325 at July 31, 1996                        262,101               127,930
                                                                                   -------               -------

Other assets:
         Deferred debt costs, net                                                    6,258                20,362
         Other                                                                      24,681                31,877
                                                                                    ------                ------
                  Total other assets                                                30,939                52,239
                                                                                   -------               -------
                  Total assets                                              $    8,817,155        $    8,487,711
                                                                                 =========             =========


                           LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
         Current portion of long-term debt                                   $   1,400,198         $      86,936
         Accounts payable                                                          135,359               189,536
         Accrued expenses                                                           44,076               162,213
                                                                                    ------               -------
                  Total current liabilities                                      1,579,633               438,685

Long-term debt, less current portion                                                18,060             1,398,760
                                                                                    ------             ---------

         Total liabilities                                                       1,597,693             1,837,445
                                                                                 ---------             ---------

Commitments and contingencies

Stockholders' equity:
         Preferred stock, $.001 par value.
                  Authorized and unissued, 1,000,000 shares
                  at April 30, 1997 and July 31, 1996                                 -                    -
         Common stock, $.001 par value.
                  Authorized  25,000,000  shares  April  30,  1997;  Issued  and
                  outstanding 14,771,343 shares at April 30,
                  1997 and 13,859,209 shares at July 31, 1996                       14,771                13,859
         Capital in excess of par value                                         50,561,541            47,023,529
         Common stock to be issued, 89,634 shares at July 31, 1996                    -                  258,335
         Subscription receivable, 89,634 shares at July 31, 1996                      -                 (254,185)
Deficit accumulated during development stage                                   (43,356,850)          (40,391,272)
                                                                                ------------          ------------
                  Total stockholders' equity                                     7,219,462             6,650,266
                                                                                 ---------             ---------

                  Total liabilities and stockholders' equity                 $   8,817,155         $   8,487,711
                                                                                 =========             =========

See accompanying notes to financial statements.

                                      - 2 -
</TABLE>

<PAGE>

                              ALFACELL CORPORATION
                          (A Development Stage Company)

                            STATEMENTS OF OPERATIONS

                       Three months and nine months ended
                         April 30, 1997 and 1996 and the
                           Period from August 24, 1981
                      (Date of Inception) to April 30, 1997

                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                                                   August 24, 1981


                                                                                                                      (Date of
                                                      Three Months Ended               Nine Months Ended              Inception)
                                                          April 30,                       April  30,                      To

                                                       1997            1996             1997              1996    April 30, 1997
                                                       ----            ----             ----              ----    --------------
REVENUE:
<S>                                           <C>                <C>             <C>              <C>            <C>            
    Sales                                     $       -          $      -        $       -        $       -      $       553,489
<S>                                                <C>                <C>             <C>               <C>              <C>    
    Investment income                              109,232            31,083          338,280           105,563          723,534
    Other income                                      -                 -                -                 -              60,103
                                                   -------            ------          -------           -------           ------

TOTAL REVENUE                                      109,232            31,083          338,280           105,563        1,337,126
                                                   -------            ------          -------           -------        ---------

COSTS AND EXPENSES:
    Cost of sales                                     -                 -                -                 -             336,495
    Research and development                       677,007           520,826        2,370,768         1,541,826       24,930,158
    General and administrative                     285,863           197,138          840,290           621,627       16,546,072
    Interest:
                    Related parties                   -                   45             -                1,801        1,033,960
                    Others                          29,757            31,205           92,800            96,517        1,847,291
                                                    ------            ------          -------           -------        ---------

TOTAL COSTS AND EXPENSES                           992,627           749,214        3,303,858         2,261,771       44,693,976
                                                  --------           -------        ---------         ---------       ----------

NET LOSS                                      $   (883,395)      $  (718,131)  $   (2,965,578)    $  (2,156,208)   $ (43,356,850)
                                                  =========         =========     ===========       ===========     ============

Loss per common share                          $     ( .06)      $      (.06)$          (.20)   $         (.19)  $        (7.23)

Weighted average number of shares
outstanding                                     14,668,354        11,798,079       14,517,375        11,595,982        5,989,290
                                                ==========        ==========       ==========        ==========        =========
</TABLE>


See accompanying notes to financial statements.

                                      - 3 -

<PAGE>
                              ALFACELL CORPORATION
                          (A Development Stage Company)


                            STATEMENTS OF CASH FLOWS

                      Nine months ended April 30, 1997 and
                         1996 and the Period from August
                                    24, 1981
                      (Date of Inception) to April 30, 1997

                                   (Unaudited)

<TABLE>
<CAPTION>
 
                                                                       Nine Months Ended                  August 24, 1981
                                                                            April 30,                    (Date of inception)
                                                                     1997               1996               April 30, 1997
                                                                     ----               ----               --------------

Cash flows from operating activities:
<S>                                                             <C>              <C>                       <C>             
   Net Loss                                                     $   (2,965,578)  $   (2,156,208)           $   (43,356,850)
   Adjustments to reconcile net loss to net cash
         used in operating activities:
     Gain on sale of marketable securities                              -                  -                       (25,963)
     Depreciation and amortization                                      50,130           58,398                  1,097,359
     Loss on disposal of property and equipment                         -                  -                        18,926
     Noncash operating expenses                                         27,900           15,997                  4,915,861
     Amortization of deferred compensation                              -                  -                    11,442,000
     Amortization of organization costs                                 -                  -                         4,590
Changes in assets and liabilities:
     Decrease in loan receivable, related party                        112,250             -                          -
     Increase in prepaid expenses                                     (137,693)         (52,139)                  (201,543)
     (Increase) decrease in other assets                                 7,196           (5,651)                    11,503
     Increase (decrease) in interest payable, related party             -              (137,388)                   744,539
     Increase (decrease) in accounts payable                           (54,177)         168,542                    212,624
     Increase (decrease) in accrued payroll and expenses,
        related parties                                                 -              (205,950)                 2,348,145
     Increase (decrease) in accrued expenses                          (118,137)          37,512                    585,589
                                                                      --------          ------                    --------
              Net cash used in operating activities                 (3,078,109)      (2,276,887)               (22,203,220)
                                                                    -----------      -----------               ------------
Cash flows from investing activities:
     Purchase of marketable securities                                  -                  -                      (290,420)
     Proceeds from sale of marketable equity securities                 -                  -                       316,383
     Purchase of property and equipment                               (170,197)         (26,228)                (1,212,077)
     Patent costs                                                       -                  -                       (97,841)
                                                                                                                  ---------
              Net cash used in investing activities                   (170,197)         (26,228)                (1,283,955)
                                                                      --------          --------                -----------

</TABLE>



See accompanying notes to financial statements.

                                                                     (Continued)

                                      - 4 -

<PAGE>

                              ALFACELL CORPORATION
                          (A Development Stage Company)


                      STATEMENTS OF CASH FLOWS (continued)

                        Nine months ended April 30, 1997
                          and 1996 and the Period from
                                 August 24, 1981
                      (Date of Inception) to April 30, 1997

                                   (Unaudited)

<TABLE>
<CAPTION>

                                                                             Nine Months Ended               August 24, 1981
                                                                                April 30,                  (Date of inception)
                                                                        1997            1996                April 30, 1997
                                                                        ----            ----              ----------------
Cash flows from financing activities:
<S>                                                           <C>                                                  <C>    
 Proceeds from short-term borrowings                          $         -                -                         849,500
 Payment of short-term borrowings                                       -                -                        (623,500)
 Increase in loans payable - related party, net                         -                -                       2,628,868
 Proceeds from bank debt and other long-term debt,
<S>                                                                      <C>             <C>                     <C>      
   net of deferred debt costs                                            4,200           29,540                  2,410,883
 Reduction of bank debt and long-term debt                             (71,638)        (127,915)                (1,507,197)
 Proceeds from common stock to be issued                                 -               -                         433,358
 Proceeds from issuance of common stock
   and warrants, net                                                   504,000        3,033,876                 22,172,561
 Proceeds from exercise of stock options and
    warrants, net                                                    3,002,874          326,630                  5,098,274
 Proceeds from issuance of convertible debentures                        -               -                         347,000
                                                                  ------------       ----------                -----------
     Net cash provided by financing activities                       3,439,436        3,262,131                 31,809,747
                                                                  ------------       ----------                -----------
     Net increase in cash                                              191,130          959,016                  8,322,572
Cash and cash equivalents at beginning of period                     8,131,442        1,398,027                      -
                                                                   -----------        ---------                  -----
Cash and cash equivalents at end of period                      $    8,322,572        2,357,043                  8,322,572
                                                                   ===========        =========                  =========
Supplemental disclosure of cash flow information -
 interest paid                                                    $    104,546           96,446                  1,594,274
                                                                   ===========        =========                  =========
Noncash financing activities:
 Issuance of convertible subordinated debenture for
   loan payable to officer                                        $      -                -                      2,725,000
                                                                      ========        =========                  =========
 Issuance of common stock upon the conversion of
   convertible subordinated debentures, related party             $      -                -                      2,945,000
                                                                      ========        =========                  =========
 Conversion of short-term borrowings to common stock              $      -                -                        226,000
                                                                      ========        =========                    =======
 Conversion of accrued interest, payroll and expenses
   by related parties to stock options                            $      -                -                      3,194,969
                                                                      ========        =====                       ---------
  Repurchase of stock options from related party                   $      -                -                      (198,417)
                                                                      ========        =========                   =========
 Conversion of accrued interest to stock options                  $      -                -                        142,441
                                                                      ========        =========                    =======
 Conversion of accounts payable to common stock                   $      -                -                         77,265
                                                                      ========        =========                     ======
Conversion of notes payable, bank and accrued
   interest to long-term debt                                     $      -                -                      1,699,072
                                                                      ========        =========                  =========
 Conversion of loans and interest payable, related
   party and accrued payroll and expenses, related
   parties to long-term accrued payroll and other,
   related party                                                  $      -                -                      1,863,514
                                                                      ========        =========                  =========
 Issuance of common stock upon the conversion of
   convertible subordinated debentures, other                     $      -                -                        127,000
                                                                      ========        =========                    =======

</TABLE>

See accompanying notes to financial statements.

                                      - 5 -

<PAGE>

                              ALFACELL CORPORATION
                          (A Development Stage Company)

                          NOTES TO FINANCIAL STATEMENTS

                                   (Unaudited)


1.   ORGANIZATION AND BASIS OF PRESENTATION


     In  the  opinion  of  management,   the  accompanying  unaudited  financial
statements  contain all adjustments  (consisting of normal  recurring  accruals)
necessary to present  fairly the  Company's  financial  position as of April 30,
1997; the results of operations for the nine month periods ended April 30, 1997,
and 1996;  and the period August 24, 1981 (date of inception) to April 30, 1997.
The  results of  operations  for the nine  months  ended  April 30, 1997 are not
necessarily indicative of the results to be expected for the full year.

     The  Company is a  development  stage  company as defined in the  Financial
Accounting  Standards Board's Statement of Financial Accounting Standards No. 7.
The Company is devoting substantially all of its present efforts to establishing
a new  business.  Its  planned  principal  operations  have not  commenced  and,
accordingly, no significant revenue has been derived therefrom.

     Certain reclassifications to the prior year financial information were made
to conform with the April 30, 1997 presentation.


2.   CAPITAL STOCK


     In August 1996, a total of 387,300 stock options were  exercised by related
parties,  resulting in net proceeds of approximately  $1,499,000 to the Company.
The exercise price of the options was $3.87 per share.

     In August 1996,  the Company  issued  10,000 stock options with an exercise
price of $4.69 exercisable for five years as payment for services  rendered.  An
equal portion of these options vest monthly for one year commencing September 1,
1996. The Company recorded general and  administrative  expense of $27,900 which
was the fair value on the date of issuance.

     In September 1996, 213,700 stock options were exercised by both related and
unrelated  parties  resulting in net proceeds of  approximately  $830,000 to the
Company.  The  exercise  prices of the  options  ranged  from $3.87 to $4.00 per
share.

     On September 13, 1996,  the  Securities  and Exchange  Commission  declared
effective  a   registration   statement  for  the  offer  and  sale  by  certain
stockholders  of up to  2,042,506  shares of common  stock.  Of these shares (i)
1,722,646  were  issued in several  private  placement  transactions  during the
period October 1995 through April 1996 and in the private placement completed in
June 1996 (the "June 1996 Private  Placement"),  (ii) 313,800 are issuable  upon
exercise of warrants which were issued in the June 1996 Private  Placement,  and
(iii)  6,060 were  issued to one of the  Company's  raw  material  suppliers  in
connection with a supply agreement.


                                      - 6 -

<PAGE>

                              ALFACELL CORPORATION
                          (A Development Stage Company)

                          NOTES TO FINANCIAL STATEMENTS

                                   (Unaudited)


2.   CAPITAL STOCK (continued)


     Also on September 13, 1996, the Securities and Exchange Commission declared
effective  another  registration  statement  for the offer  and sale by  certain
stockholders of up to 3,767,787 shares of common stock of the Company.  Of these
shares (i) an aggregate of 1,951,020 shares were issued to the private placement
investors in the private placement  transactions which were completed during the
period March 1994 through  September  1995 (the "Earlier  Private  Placements"),
(ii) an aggregate of 1,184,451 shares are issuable upon the exercise of warrants
which were  issued to the private  placement  investors  in the Earlier  Private
Placements,  (iii) an  aggregate of 622,316  shares may be issued,  or have been
issued,  upon  exercise of options  which were  issued to the option  holders in
certain other private  transactions,  and (iv) up to 10,000 shares may be issued
to the  Company's  bank  upon  exercise  of the  warrant  issued  to the bank in
connection  with an amendment to the Company's term loan agreement with its bank
(the "Term Loan").

     In November and  December  1996,  an aggregate of 26,000 stock  options and
2,000 warrants were exercised by both related and unrelated parties resulting in
net proceeds of approximately $84,000 to the Company. The exercise prices of the
options  ranged  from  $2.45 to $3.12 per share  and the  exercise  price of the
warrants was $5.00 per share.

     In March 1997,  a private  placement  of 112,000  shares of common stock at
$4.50 per share  was made to a single  investor  resulting  in net  proceeds  of
$504,000 to the Company.

     In March 1997,  12,500 stock options and 24,000  warrants were exercised by
unrelated  parties  resulting in net  proceeds of $158,300 to the  Company.  The
exercise  prices of the  options  ranged  from  $2.84 to $3.12 per share and the
exercise price of the warrants was $5.00 per share.

     In  April  1997,  45,000  warrants  were  exercised  by  unrelated  parties
resulting in net proceeds of $225,000 to the Company.  The exercise price of the
warrants was $5.00 per share.

                                      - 7 -

<PAGE>

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


     Information  contained herein contains  "forward-looking  statements" which
can be identified by the use of forward-looking  terminology such as "believes,"
"expects,"  "may," "will,"  "should" or "anticipates" or the negative thereof or
other  variations  thereon  or  comparable  terminology,  or by  discussions  of
strategy.  No  assurance  can be given  that the future  results  covered by the
forward-looking  statements  will be achieved.  The matters set forth in Exhibit
99.1 hereto constitute cautionary statements, identifying important factors with
respect  to such  forward-  looking  statements,  including  certain  risks  and
uncertainties,  that could  cause  actual  results to vary  materially  from the
future results indicated in such forward-looking statements. Other factors could
also cause actual results to vary materially  from the future results  indicated
in such forward-looking statements.

Results of Operations

Three and nine month periods ended April 30, 1997 and 1996

     Revenues.  The  Company is a  development  stage  company as defined in the
Financial   Accounting  Standards  Board's  Statement  of  Financial  Accounting
Standards  No. 7. As such,  the  Company is  devoting  substantially  all of its
present efforts to establishing a new business and developing new products.  The
Company's  planned  principal  operations of marketing  and/or  licensing of new
drugs have not  commenced  and,  accordingly,  no  significant  revenue has been
derived  therefrom.  The Company  continues to marshall all its  productive  and
financial  resources to proceed with its development of ONCONASE and as such has
not had any sales in the nine  month  periods  ended  April  30,  1997 and 1996.
Investment  income  for the nine  months  ended  April  30,  1997  increased  to
$338,000,  compared to $106,000 for the same period last year due to an increase
in the amount of funds invested.

     Research and  Development.  Research and development  expense for the three
months  ended April 30,  1997 was  $677,000  compared  to $521,000  for the same
period last year,  an increase of 156,000 or 30%. The increase was primarily due
to the hiring of  additional  clinical  and  laboratory  personnel  and costs in
support of on-going clinical trials, including the Phase III clinical trials for
pancreatic cancer and the Phase II clinical trial for malignant mesothelioma and
additional costs related to applications for new patents, offset by decreases in
costs  associated  with the purchase of raw  materials  and the  manufacture  of
clinical supplies of ONCONASE.

     Research and  development  expense for the nine months ended April 30, 1997
was $2,371,000 compared to $1,542,000 for the same period last year, an increase
of $829,000 or 54%. The increase was  primarily  due to the hiring of additional
clinical  and  laboratory  personnel,  increases  in costs  associated  with the
purchase of raw materials for anticipated  future production of ONCONASE,  costs
to  manufacture  clinical  supplies  of  ONCONASE,  costs in support of on-going
clinical trials,  including the Phase III clinical trials for pancreatic  cancer
and the Phase II clinical trial for malignant  mesothelioma and additional costs
related to applications for new patents.

     General  and  Administrative.  General and  administrative  expense for the
three months ended April 30, 1997 was $286,000 compared to $197,000 for the same
period last year,  an increase of $89,000 or 45%. The increase was primarily due
to the hiring of additional personnel,  including the Company's new President in
August 1996,  and an increase in public  relations  activities and insurance and
depreciation expense.

     General and administrative expense for the nine months ended April 30, 1997
was $840,000  compared to $622,000 for the same period last year, an increase of
$218,000 or 35%.  The  increase was  primarily  due to the hiring of  additional
personnel, including the Company's new President in August 1996, and an increase
in public relations activities and insurance and depreciation expense, offset by
a reduction in amortization expense on the Company's Term Loan.


                                      - 8 -

<PAGE>

     Interest.  Interest  expense for the three  months ended April 30, 1997 was
$30,000  compared to $31,000 for the same period last year, a decrease of $1,000
or 3%. The decrease was primarily due to a reduction in the principal balance of
the Company's Term Loan which was amended effective as of October 31, 1995.

     Interest  expense  for the nine  months  ended  April 30,  1997 was $93,000
compared to $98,000  for the same period last year,  a decrease of $5,000 or 5%.
The decrease was primarily  due to a reduction in the  principal  balance of the
Company's Term Loan and reductions in related and unrelated party payables.

     Net Loss.  The Company has incurred  net losses  during each year since its
inception.  The net loss for the three  months ended April 30, 1997 was $883,000
compared to $718,000  for the same period last year,  an increase of $165,000 or
23%.  The net loss for the nine months  ended April 30, 1997 was  $2,966,000  as
compared to $2,156,000 for the same period last year, an increase of $810,000 or
38%. The  cumulative  loss from the date of inception,  August 24, 1981 to April
30, 1997 amounted to $43,357,000.  Such losses are attributable to the fact that
the Company is still in the development  stage and accordingly,  has not derived
sufficient revenues from operations to offset the development stage expenses.

Liquidity and Capital Resources

     Alfacell has financed its  operations  since  inception  primarily  through
equity and debt  financing  and  interest  income.  During the nine months ended
April 30, 1997,  the Company had a net increase in cash and cash  equivalents of
$191,000,  which  resulted  from net cash  provided by financing  activities  of
$3,439,000,  primarily  from the  issuance of common  stock upon the exercise of
stock options and warrants and from a private placement of common stock in March
1997,  offset by the purchase of property and equipment of $170,000 and net cash
used in operating activities of $3,078,000.

     The Company's  Term Loan matures on August 31, 1997.  The entire  principal
amount  outstanding  on the Term Loan as of April 30,  1997 was  reflected  as a
current  liability.  This is the primary  reason for a  significant  increase in
current  liabilities  as of April  30,  1997  compared  to July  31,  1996 and a
significant decrease in long-term debt as of April 30, 1997 compared to July 31,
1996. The Company estimates that the outstanding balance on August 31, 1997 will
be $1,369,000.  At that time, the Company  intends to either  refinance the Term
Loan, or use its current cash  resources or raise  sufficient  equity to pay off
the unpaid  balance.  However,  there can be no assurance  that the Company will
have sufficient  cash resources  available at that time, that it will be able to
raise  sufficient  equity  or that it will be able to  successfully  conclude  a
refinancing.

     The  Company's  continued  operations  will  depend on its ability to raise
additional   funds   through  a  combination   of  equity  or  debt   financing,
collaborative  agreements,  strategic alliances and revenues from the commercial
sale  of  ONCONASE.  The  Company  is  in  discussions  with  several  potential
collaborative  partners  for further  development  and  marketing  of  ONCONASE;
however,  there  can  be  no  assurance  that  any  such  arrangements  will  be
consummated.  In addition, the Company expects that its cash needs in the future
will increase due to the on-going clinical trials. The Company believes that its
cash and cash  equivalents  as of April 30, 1997 will be  sufficient to meet its
anticipated  cash needs for  approximately  the next two years,  assuming that a
significant portion of such cash reserves is not used to repay the Term Loan. To
date, a significant  portion of the Company's financing has been through private
placements  of common  stock and  warrants,  the  exercise of stock  options and
warrants, debt financing and financing provided by the Company's Chief Executive
Officer.  The Company's  long-term liquidity will depend on its ability to raise
substantial  additional funds. There can be no assurance that such funds will be
available to the Company on acceptable terms, if at all.

                                      - 9 -

<PAGE>

     Pursuant to the terms of the Term Loan agreement, the Company is prohibited
without the bank's consent, from incurring any additional indebtedness except as
follows:  (i) additional  indebtedness to the bank, (ii)  indebtedness  having a
priority  of  payment  which is  expressly  junior to and  inferior  in right of
payment to the prior  payment-in-full to the bank, (iii) indebtedness arising as
a result of  obligations of the Company over the life of its leases which in the
aggregate do not exceed $200,000, or (iv) unsecured  indebtedness arising in the
ordinary course of the Company's  business which at no time exceeds  $1,452,000.
Pursuant to the Term Loan,  the Company is required to make  prepayments  to the
extent its gross revenues exceed certain levels. Pursuant to a pledge agreement,
the Company's  Chief  Executive  Officer has pledged the shares of the Company's
Common Stock owned by her to secure  repayment of the Term Loan. The pledgor may
from  time-to-time  request that the bank release a portion of the pledged stock
when market  conditions  are  favorable  in order to permit  sales of such stock
whereupon the proceeds will be used to make  payments  under the pledgor's  term
loan agreement with the bank. The Term Loan agreement  prohibits the issuance of
any shares by the Company or right to purchase any shares of the Company's stock
if the result of such issuance or purchase would be to decrease the ratio of the
market value of the stock pledged to the bank by the Chief Executive  Officer to
the aggregate  outstanding debt of the Company and the Company's Chief Executive
Officer, as pledgor to the bank, below 1:1.

     The  Company's  working  capital and capital  requirements  may depend upon
numerous  factors,   including  the  progress  of  the  Company's  research  and
development programs,  the timing and cost of obtaining regulatory approvals and
the  levels  of  resources  that  the  Company  devotes  to the  development  of
manufacturing and marketing capabilities.


                                     - 10 -

<PAGE>

PART II.         OTHER INFORMATION

Item 2. (c) Recent Sales of Unregistered Securities

                 On March 3, 1997,  pursuant to a Purchase  Agreement for Common
Stock,  the Company issued 112,000 shares of Common Stock,  par value $.001 to a
single  investor  with an aggregate  value of  $504,000.  This  transaction  was
consummated as a private sale pursuant to Section 4 (2) of the Securities Act of
1933, as amended.

                 In March 1997,  24,000 warrants received in connection with the
Earlier  Private  Placements  were  exercised to purchase  Common Stock,  for an
aggregate  consideration  of $120,000.  This  transaction  was  consummated as a
private  sale  pursuant  to  Section  4 (2) of the  Securities  Act of 1933,  as
amended.

                 In April 1997,  45,000 warrants received in connection with the
Earlier  Private  Placements  were  exercised to purchase  Common Stock,  for an
aggregate  consideration  of $225,000.  This  transaction  was  consummated as a
private  sale  pursuant  to  Section  4 (2) of the  Securities  Act of 1933,  as
amended.


Item 6.          Exhibits and Reports on Form 8-K

(a) Exhibits (numbered in accordance with Item 601 of Regulation S-B).

<TABLE>
<CAPTION>

                                                                                               Exhibit No.
                                                                                                  or
    Exhibit                                                                                  Incorporation
      No.                                           Item Title                                by Reference
     ----                                           ----------                               -------------
<C>                                                                                              <C>
3.1             Certificate of Incorporation                                                       *
3.2             By-Laws                                                                            *
3.3             Amendment to Certificate of Incorporation                                          #
4.1             Form of Convertible Debenture                                                      **
10.1            Form of Stock and Warrant Purchase Agreements used in private
                placements completed April 1996 and June 1996                                      ##
10.2            Lease Agreement - 225 Belleville Avenue, Bloomfield, New
                Jersey                                                                             ###
10.3            Term Loan Agreement dated as of May 31, 1993 by and
                between the Company and First Fidelity Bank, N.A., New
                Jersey                                                                             **
10.4            Term Note dated as of May 31, 1993 issued by the Company to
                First Fidelity Bank, N.A., New Jersey                                              **

                                     - 11 -
<PAGE>

10.5            Patent Security Agreement dated as of May 31, 1993 by and
                between the Company and First Fidelity Bank, N.A., New
                Jersey                                                                             **
10.6            Security Agreement dated as of May 31, 1993 by and between
                the Company and First Fidelity Bank, N.A., New Jersey                              **
10.7            Subordination Agreement dated as of May 31, 1993 by and
                among the Company, Kuslima Shogen, and First Fidelity Bank,
                N.A., New Jersey                                                                   **
10.8            Amendment to Subordination Agreement dated as of May 31,
                1993 by and among the Company, Kuslima Shogen, and First
                Fidelity Bank, N.A., New Jersey dated June 30, 1995                                #
10.9            Form of Stock Purchase Agreement and Certificate used in
                connection with various private placements                                         ***
10.10           Form of Stock and Warrant Purchase Agreement and Warrant
                Agreement used in Private Placement completed on March 21,
                1994                                                                               ***
10.11           The Company's 1993 Stock Option Plan and Form of Option
                Agreement                                                                          *****
10.12           Debt Conversion Agreement dated March 30, 1994 with Kuslima
                Shogen                                                                             ****
10.13           Accrued Salary Conversion Agreement dated March 30, 1994
                with Kuslima Shogen                                                                ****
10.14           Accrued Salary Conversion Agreement dated March 30, 1994
                with Stanislaw Mikulski                                                            ****
10.15           Debt Conversion Agreement dated March 30, 1994 with John
                Schierloh                                                                          ****
10.16           Option Agreement dated March 30, 1994 with Kuslima Shogen                          ****
10.17           Amendment No. 1 dated June 20, 1994 to Option Agreement
                dated March 30, 1994 with Kuslima Shogen                                           ****
10.18           Amendment No. 1 dated June 17, 1994 to Term Loan
                Agreement dated May 31, 1993 between Kuslima Shogen and
                First Fidelity Bank, N.A., New Jersey                                              ****
10.19           Second Pledge Agreement dated June 17, 1994 by and among
                the Company, Kuslima Shogen and First Fidelity Bank, N.A.,
                New Jersey                                                                         ****
10.20           Form of Amendment No. 1 dated June 20, 1994 to Option
                Agreement dated March 30, 1994 with Kuslima Shogen                                 *****


                                     - 12 -

<PAGE>

10.21           Form of Amendment No. 1 dated June 20, 1994 to Option
                Agreement dated March 30, 1994 with Stanislaw Mikulski                             *****
10.22           Form of Stock and Warrant Purchase Agreement and Warrant
                Agreement used in Private Placement completed on September
                13, 1994                                                                           +
10.23           Form of Subscription Agreements and Warrant Agreement used
                in Private Placements closed in October 1994 and September
                1995                                                                               +
10.24           Amendment No. 1 dated as of October 1, 1995 to Term Loan
                Agreement dated as of May 31, 1993 by and between the
                Company and First Fidelity Bank, N.A. New Jersey                                   ~
10.25           Amended and Restated Term Note dated as of October 1, 1995
                issued by the Company to First Fidelity Bank, N.A. New Jersey                      ~
10.26           Warrant dated as of October 1, 1995 issued by the Company to
                First Fidelity Bank, N.A. New Jersey                                               ~
10.27           Common Stock Purchase Agreement by and between the
                Company and Digital Creations, Inc. dated March 3, 1997                            ###
10.28           The Company's 1997 Stock Option Plan                                               ###
27.1            Financial Data Schedule                                                            ###
99.1            Factors to Consider in Connection with Forward-Looking
                Statements                                                                         ###

</TABLE>


*    Previously filed as exhibit to the Company's Registration Statement on Form
     S-18 (File No. 2-79975-NY) and incorporated herein by reference thereto.

**   Previously  filed as exhibits to the  Company's  Annual Report on Form 10-K
     for the year  ended  July 31,  1993 and  incorporated  herein by  reference
     thereto.

***  Previously  filed as exhibits  to the  Company's  Quarterly  Report on Form
     10-QSB for the quarter  ended January 31, 1994 and  incorporated  herein by
     reference thereto.

**** Previously  filed as exhibits  to the  Company's  Quarterly  Report on Form
     10-QSB for the  quarter  ended April 30,  1994 and  incorporated  herein by
     reference thereto.

*****Previously filed as exhibits to the Company's  Registration  Statement Form
     SB-2 (File No. 33-76950) and incorporated herein by reference thereto.

                                     - 13 -

<PAGE>

+    Previously  filed as exhibits to the  Company's  Registration  Statement on
     Form SB-2 (File No. 33-83072) and incorporated herein by reference thereto.

++   Previously  filed as exhibits  to the  Company's  Quarterly  Report on Form
     10-QSB for the  quarter  ended April 30,  1995 and  incorporated  herein by
     reference thereto.

+++  Previously  filed as exhibits to the Company's Annual Report on Form 10-KSB
     for the year  ended  July 31,  1996 and  incorporated  herein by  reference
     thereto.

~    Previously  filed as exhibits to the  Company's  Registration  Statement on
     Form SB-2 (File No. 33-63341) and incorporated herein by reference thereto.

#    Previously  filed as exhibits to the Company's Annual Report on Form 10-KSB
     for the year  ended  July 31,  1995 and  incorporated  herein by  reference
     thereto.

##   Previously  filed as exhibits to the  Company's  Registration  Statement on
     Form SB-2  (File  No.  333-11575)  and  incorporated  herein  by  reference
     thereto.

###  Filed herewith.

(b)             Reports on Form 8-K.

                None.


                                     - 14 -

<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.


                                                  ALFACELL CORPORATION
                                                   (Registrant)


June 13, 1997                                       /s/GAIL E. FRASER
-------------                                       -----------------
Date                                                 Gail E. Fraser
                                                     Vice President, Finance and
                                              Chief Financial Officer (Principal
                                                Accounting Officer and Principal
                                                              Financial Officer)