<PAGE>   1
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                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                            ------------------------

                                    FORM 10-Q

(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, 2000

                                       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 0-24758

                            MICRO LINEAR CORPORATION
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

                         DELAWARE                          94-2910085
              (STATE OR OTHER JURISDICTION OF           (I.R.S. EMPLOYER
              INCORPORATION OR ORGANIZATION)         IDENTIFICATION NUMBER)

                   2092 CONCOURSE DRIVE                       95131
                   SAN JOSE, CALIFORNIA                    (ZIP CODE)
              (ADDRESS OF PRINCIPAL EXECUTIVE
                         OFFICES)

       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (408) 433-5200
           SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
                          COMMON STOCK, $.001 PAR VALUE
                        PREFERRED SHARE PURCHASE RIGHTS

    Indicate by check mark whether the Registrant (1) has filed all reports 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 [ ]

    The number of shares of the Registrant's Common Stock outstanding net of
shares held in treasury as of April 28, 2000 was 11,464,518.


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                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                   PAGE
<S>             <C>                                                                <C>
  PART I.       FINANCIAL INFORMATION

  Item 1.       Financial Statements

                Consolidated Condensed Statements of Operations for the three
                months ended March 31, 2000 and 1999 ...........................     3

                Consolidated Condensed Balance Sheets at March 31, 2000 and at
                December 31, 1999...............................................     4

                Consolidated Condensed Statements of Cash Flows for the three
                months ended March 31, 2000 and 1999 ...........................     5

                Notes to Consolidated Condensed Financial Statements............     6

  Item 2.       Management's Discussion and Analysis of Financial Condition and
                Results of Operations...........................................     8

  Item 3.       Quantitative and Qualitative Disclosures about Market Risk......     11

  PART II.      OTHER INFORMATION

  Item 1.       Legal Proceedings...............................................     13

  Item 6.       Exhibits and Reports on Form 8-K................................     13

  SIGNATURES....................................................................     14
</TABLE>


                                       2
<PAGE>   3



                          PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                            MICRO LINEAR CORPORATION
                 CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                                          THREE MONTHS ENDED MARCH 31,
                                                                          ----------------------------
                                                                              2000          1999
                                                                            --------      --------
<S>                                                                         <C>           <C>
Net revenues .........................................................      $ 11,381      $ 10,906
Cost of revenues .....................................................         5,367         5,651
                                                                            --------      --------
   Gross profit ......................................................         6,014         5,255
                                                                            --------      --------
Operating expenses:
   Research and development ..........................................         3,276         3,500
   Selling, general and administrative ...............................         2,606         2,884
                                                                            --------      --------
                                                                               5,882         6,384
                                                                            --------      --------
   Income (loss) from operations .....................................           132        (1,129)
Interest and other income, net .......................................           387           379
Interest expense .....................................................            56            63
                                                                            --------      --------
   Income (loss) before taxes ........................................           463          (813)
Provision (benefit) for income taxes .................................           162          (756)
                                                                            --------      --------
   Net income (loss) .................................................      $    301      $    (57)
                                                                            ========      ========

Net income (loss) per share:

Basic:
   Net income (loss) per share .......................................      $   0.03      $  (0.01)
                                                                            ========      ========
   Weighted average number of shares used in per share computation ...        11,218        10,974
                                                                            ========      ========
Diluted:
   Net income (loss) per share .......................................      $   0.03      $  (0.01)
                                                                            ========      ========
   Weighted average number of shares used in per share computation ...        11,998        10,974
                                                                            ========      ========
</TABLE>


See accompanying notes to unaudited consolidated condensed financial statements.


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<PAGE>   4

                            MICRO LINEAR CORPORATION
                      CONSOLIDATED CONDENSED BALANCE SHEETS
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                  MARCH 31,     DECEMBER 31,
                                                                    2000           1999
                                                                 (UNAUDITED)     (AUDITED)
                                                                 -----------    ------------
<S>                                                               <C>           <C>
ASSETS
Current assets:
  Cash and cash equivalents ................................      $ 12,675       $  7,381
  Short-term investments ...................................        18,783         24,122
  Accounts receivable, net .................................         6,576          5,762
  Inventories ..............................................         7,202          5,917
  Other current assets .....................................         3,732          5,113
                                                                  --------       --------
     Total current assets ..................................        48,968         48,295
Property, plant and equipment, net .........................        20,108         19,686
Other assets ...............................................           431            458
                                                                  --------       --------
          Total assets .....................................      $ 69,507       $ 68,439
                                                                   ========       ========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable .........................................      $  4,106       $  4,099
  Deferred income on shipments to distributors .............         2,883          3,235
  Other accrued liabilities ................................         2,653          2,436
  Current portion of long-term debt ........................           211            211
                                                                  --------       --------
     Total current liabilities .............................         9,853          9,981
Long-term debt .............................................         2,704          2,755
                                                                  --------       --------
Stockholders' equity:
  Preferred stock ..........................................            --             --
  Common stock .............................................            14             14
  Additional paid-in capital ...............................        55,964         55,026
  Retained earnings ........................................        21,246         20,945
  Accumulated other comprehensive loss .....................           (41)           (49)
  Treasury stock ...........................................       (20,233)       (20,233)
                                                                  --------       --------
     Total stockholders' equity ............................        56,950         55,703
                                                                  --------       --------
          Total liabilities and stockholders' equity .......      $ 69,507       $ 68,439
                                                                  ========       ========
</TABLE>

See accompanying notes to unaudited consolidated condensed financial statements.


                                       4
<PAGE>   5


                            MICRO LINEAR CORPORATION
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                           THREE MONTHS ENDED
                                                                      ----------------------------
                                                                      MARCH 31,          MARCH 31,
                                                                        2000               1999
                                                                      --------           --------
<S>                                                                   <C>                <C>
Cash provided by operating activities ......................          $    789           $    935

Investing activities:
   Capital expenditures ....................................            (1,729)              (745)
   Proceeds from sale of equipment .........................                --                115
   Purchases of short-term investments .....................            (5,510)           (10,320)
   Sales of short-term investments .........................            10,857              9,874
                                                                      --------           --------
     Net cash provided by (used in) investing activities ...             3,618             (1,076)

Financing activities:
   Principal payments on debt ..............................               (51)               (45)
   Proceeds from issuance of common stock ..................               938                104
   Acquisition of treasury stock ...........................                --             (1,514)
                                                                      --------           --------
     Net cash provided (used) in financing activities ......               887             (1,455)
                                                                      --------           --------
   Net increase (decrease) in cash and cash equivalents ....             5,294             (1,596)
   Cash and cash equivalents at beginning of period ........             7,381              6,393
                                                                      --------           --------
   Cash and cash equivalents at end of period ..............          $ 12,675           $  4,797
                                                                      ========           ========
</TABLE>

See accompanying notes to unaudited consolidated condensed financial statements.



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<PAGE>   6

                            MICRO LINEAR CORPORATION

              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1)   Micro Linear Corporation (the "Company") designs, develops and markets high
     performance analog and mixed signal integrated circuits for a broad range
     of applications within the communications, computer and industrial markets
     for sale primarily in North America, Asia and Europe. The Company operates
     in a single industry segment.

2)   The accompanying interim financial statements are unaudited and have been
     prepared by the Company in accordance with generally accepted accounting
     principles and contain all adjustments (consisting of normal recurring
     adjustments) to fairly present the financial information included. While
     the Company believes that the disclosures are adequate to make the
     information not misleading, it is suggested that these financial statements
     be read in conjunction with the Company's Annual Report on Form 10-K for
     the year ended December 31, 1999. The results of operations for the interim
     periods shown in this report are not necessarily indicative of results to
     be expected for the fiscal year.

3)   For financial reporting purposes, the Company's fiscal year ends on the
     Sunday closest to December 31. Fiscal year 1999 ended on January 2, 2000.
     The Company's fiscal quarters are 13 weeks in length. The first quarter of
     2000 ended on April 2, 2000. For presentation purposes, the accompanying
     unaudited consolidated condensed financial statements refer to the
     quarters' calendar month end for convenience.

     The Company uses the U.S. dollar as its functional currency. Foreign
     currency transaction gains and losses are included in operating income or
     loss as they occur. The effect of foreign currency exchange rate
     fluctuations was not significant. The Company does not use derivative
     instruments.

     The preparation of financial statements in conformity with generally
     accepted accounting principles requires management to make estimates and
     assumptions that affect the reported amounts of assets and liabilities and
     disclosure of contingent assets and liabilities at the date of the
     financial statements and the reported amounts of revenues and expenses
     during the reporting period. Actual results could differ from those
     estimates.

4)   During the three months ended March 31, 2000, one customer accounted for
     23% of net revenues. During the three months ended March 31, 1999, two
     customers accounted for 20% and 12% of total sales, respectively.

5)   Supplemental Financial Information

     Inventories consist of the following (in thousands):

<TABLE>
<CAPTION>
                                                                          MARCH 31,        DECEMBER 31,
                                                                            2000              1999
                                                                        -------------      ------------
<S>                                                                     <C>                <C>
          Raw materials..............................................        $38                 $39
          Work-in-process............................................      5,240               4,190
          Finished goods.............................................      1,924               1,688
                                                                           -----               -----
                                                                          $7,202              $5,917
                                                                          ======              ======
</TABLE>


     Property, plant and equipment consist of the following (in thousands):


<TABLE>
<CAPTION>
                                                                          MARCH 31,        DECEMBER 31,
                                                                            2000              1999
                                                                        -------------      ------------
<S>                                                                     <C>                <C>
          Land.......................................................     $2,850              $2,850
          Buildings and improvements.................................      9,984               9,984
          Machinery and equipment....................................     38,491              36,762
                                                                          ------              ------
                                                                          51,325              49,596
          Accumulated depreciation and amortization..................     31,217              29,910
                                                                          ------              ------
          Net property, plant and equipment..........................    $20,108             $19,686
                                                                         =======             =======
</TABLE>


                                       6
<PAGE>   7


6)   Cash payments for income taxes and interest expense totaled $3,000 and
     $56,000, respectively, for the three months ended March 31, 2000. Cash
     payments for income taxes and interest expense totaled $240,000 and
     $63,000, respectively, for the three months ended March 31, 1999.

7)   The Company's provision for taxes on income is based on estimates of the
     levels of income and certain deductions expected for the year, which may be
     subject to change. The Company's effective tax rate for the first quarter
     of 2000 was 35%, compared to a benefit of 93% for the same period in 1999.
     The higher effective tax benefit in the first quarter of 1999 was due to
     the anticipated impact of the Federal R&D Tax Credit and California
     Investment Tax Credit on the full year 1999 tax provision.

   From January 1996 through the end of the first quarter of 1999, the Company's
Board of Directors had approved the repurchase of an aggregate of $20.3 million
of the Company's Common Stock. Through March 31, 1999, the Company had
repurchased 2,696,900 shares for a total cost of $20.2 million. The Company's
common stock buy-back program was terminated at the end of the first quarter of
1999. The Company employed the net income per share calculation methodology
prescribed by Statement of Financial Accounting Standards No. 128 ("SFAS 128").
SFAS 128 requires presentation of basic and diluted net income per share. Basic
net income per share is computed by dividing net income available to common
stockholders (numerator) by the weighted average number of common shares
outstanding (denominator) during the period and excludes the dilutive effect of
stock options. Diluted net income per share gives effect to all dilutive
potential common stock outstanding during the period. In computing diluted net
income per share, the average stock price for the period is used in determining
the number of shares assumed to be purchased from exercise of stock options.

     Following is a reconciliation of the numerators and denominators of the
     basic and diluted income per share computations for the periods presented
     below (in thousands except per share data):


<TABLE>
<CAPTION>
                                                      Three Months Ended March 31,
                              -----------------------------------------------------------------------------
                                              2000                                   1999
                              -----------------------------------     -------------------------------------
                                                            Per-                                    Per-
                               Net Income      Shares      Share        Net Loss      Shares       Share
                              (Numerator)  (Denominator)   Amount     (Numerator)  (Denominator)   Amount
                              -----------  -------------  -------     -----------  -------------  --------
<S>                           <C>          <C>            <C>         <C>          <C>            <C>
Basic Income (loss) Per
  Share:
Net income (loss)
  available
  to common
  stockholders                 $  301        11,218        $0.03        $  (57)        10,974        $(0.01)
                               ======        ======        =====        =======        ======        =======

Effect of dilutive                              780                                        --
  securities:
  Stock options

Diluted Income (loss)
  Per Share:
  Net income (loss)
  available to common
  stockholders assuming
  Dilution                     $  301        11,998        $0.03        $  (57)        10,974        $(0.01)
                               ======        ======        =====        =======        ======        =======
</TABLE>


     Options to purchase 439,662 shares of common stock were outstanding as of
     March 31, 1999, but were not reflected in the computations of diluted
     earnings per share for the three months ended March 31, 1999 because the
     Company recorded a net loss in the period and to do so would have been
     anti-dilutive.

10)  A discussion of certain pending legal proceedings is included in Item 1 of
     Part II of the Company's Form 10-Q for the fiscal quarter ended March 31,
     2000. No assurance can be given that these matters will be resolved without
     the Company becoming obligated to make payments or to pay other costs to
     the opposing party, with the potential for having a material adverse effect
     on the Company's financial position or its results of operations.

                                       7
<PAGE>   8


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

   This Report on Form 10-Q contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Actual results could differ materially from
those projected in the forward-looking statements as a result of the risk
related factors set forth below and elsewhere in this Form 10-Q.

   Overview

   Micro Linear provides high performance analog and mixed signal integrated
circuits for a variety of applications in the computer, communications,
consumer, and industrial market segments. The Company's products enable low
cost, efficient power management for computer systems; provide video signal
conditioning in set top box applications; provide battery management in personal
digital assistants; and integrate the physical interface functions for both
wired and wireless communications. Both BiCMOS and CMOS process technologies are
currently utilized in new designs.

   In recent years, sales of communications products, including local area
networking and telecommunications, have constituted a majority of the Company's
revenues. This segment, while large, is characterized by established and intense
competition, rapidly decreasing selling prices, and rapid technological change.
Growing market acceptance of the Company's power management and video products
continues to reduce the Company's dependence on its older communications
products. As a result, video products represented approximately 15% of the
Company's revenues in the March 2000 quarter, up from only 1% in the March 1999
quarter. Late in 1999 the Company introduced its first two RF transceiver chip
sets, one for the 900MHz Digital Cordless Telephone market and another for the
2.4GHZ Wireless Local Area Network market typified by the IEEE802.11 standard.
The Company plans to continue to expand its development efforts in the area of
total silicon solutions for broadband wireless local area network applications.

   The Company's analog and mixed signal products continue to meet competitive
and alternative discrete solutions for new design opportunities, resulting in
continuing downward price pressures. Since 1997, the Company has operated with
excess in-house manufacturing capacity and a need for new and additional test
platforms to support recently introduced products. To achieve the most
competitive product test costs, in April 2000 the Company signed an agreement
with Artest Corporation to sell its entire internal test operation including
certain test equipment with an aggregate book value of approximately $6.1
million at April 30, 2000, to lease to Artest certain office space for
approximately $22,000 per month, and to transfer certain employees to Artest.
The term of the agreement is three years and provides that the Company will
subcontract to Artest certain test functions, which were previously performed
internally. The Company incurred a loss associated with the sale of this
equipment of approximately $140,000. The Company is obligated to pay retention
bonuses to Artest for the benefit of transferred employees based on the length
of their employment with Artest up to a period of twelve months. The Company
believes that the effect of this agreement with Artest Corporation will result
in a gradual lowering of manufacturing costs over the term of the agreement with
a corresponding positive effect on gross margins. The full realization of
increased gross margins from this agreement will be deferred until such time as
the Company is able to sell its existing inventories.

RESULTS OF OPERATIONS

   Net Revenues

   Net revenues for the first quarter of 2000 were $11.4 million compared to net
revenues of $12.4 million reported for the fourth quarter of 1999 and $10.9
million for the first quarter of 1999. Net revenues decreased $974,000 from the
prior quarter and increased $475,000 from the first quarter of 1999. The
decrease from the prior quarter was primarily due to inventory balancing among
several major customers. Net revenues increased from the first quarter of 1999
due to higher distributor sales to end users and a corresponding reduced
deferral of revenue by the Company in first quarter of 2000.

   The Company serves three principal markets: computer, communications and
industrial. Net revenues for the first quarter of 2000 compared to the first
quarter of 1999 decreased 17% in the communications market, increased 19% in the
computer market and increased 13% in the industrial market. Net revenues for
first quarter of 2000 compared to the fourth quarter of 1999 decreased 19%,
increased 46% and decreased 15% in the communications, computer and industrial
markets, respectively.


                                       8
<PAGE>   9

   The communications market includes the computer networking equipment
("networking") sub-market. Sales of products to the networking market
constitutes a substantial component of the Company's net revenues. Net revenues
in the networking sub-market decreased 25% in the first quarter of 2000 compared
to both the first quarter of 1999 and fourth quarter of 1999. Networking net
revenues were 38% of total net revenues for the first quarter of 2000 compared
to 48% and 44% of total net revenues for the first and fourth quarters of 1999,
respectively. The decreases were primarily due to inventory balancing among
three large customers resulting in their lower purchases during the quarter.

   International net revenues for the first quarter of 2000 totaled $5.3
million, or 46% of net revenues, compared to $4.7 million, or 43% of net
revenues, for the first quarter of 1999 and $5.2 million, or 43% of net
revenues, for the fourth quarter of 1999. The increase in international revenues
in the first quarter of 2000, compared to the first and fourth quarters of 1999,
was primarily due to an increasing proportion of customer ship-to locations
moving offshore. Domestic distributor net revenues for the first quarter of 2000
were $3.0 million, or 26% of net revenues, compared to $2.9 million, or 27% of
net revenues, for the first quarter of 1999 and $2.8 million, or 23% of net
revenues, for the fourth quarter of 1999. Revenues and cost of goods sold are
deferred by the Company until the Company is notified of product sales to end
users.

  Gross Margin

  Gross margin is affected by the volume of product sales, price, product mix,
manufacturing utilization, product yields and the mix of sales to OEM's and to
distributors.

   The Company's gross margin was $6.0 million or 53% of net revenue in the
first quarter of 2000, compared to $5.3 million or 48% of net revenue in the
first quarter of 1999 and $6.4 million or 52% of net revenue in the fourth
quarter of 1999. Gross margin was higher in the first quarter of 2000 compared
to both the first and fourth quarters of 1999 primarily due to higher production
output levels and lower manufacturing costs partially offset by unfavorable
shifts in product mix.

   The Company currently purchases its wafers from three wafer suppliers. A
substantial majority of the Company's wafer supply is obtained from two wafer
suppliers. The Company's products are assembled and packaged by four vendors.
Any delays or interruptions due to such factors as inadequate capacity or
unavailable raw materials in the Company's wafer suppliers or assembly vendors
could materially and adversely affect product shipments. The Company purchases
nearly all of its BiCMOS wafers from two wafer foundries, the majority of which
are supplied by one wafer foundry in Taiwan. Although both wafer foundries are
qualified to supply the Company with BiCMOS wafers, the Company's short-term
BiCMOS wafer supply could be materially and adversely affected if the wafer
foundry in Taiwan is unable to meet the Company's wafer supply requirements.

   Research and Development Expenses

   Research and development expenses include payroll and other costs associated
with the definition, design and development of standard and semi-standard
products, tile arrays and standard cells. In addition, research and development
expenses include test development and prototype assembly costs associated with
new product development. The Company also expenses the cost of prototype wafers
and new production mask sets related to new products as research and development
costs until products based on new designs are fully characterized by the Company
and are demonstrated to support published data sheets and satisfy reliability
tests. Research and development expenses such as mask and silicon costs that are
related to the development of new products can fluctuate from quarter to quarter
due to the timing of the product design process. The Company believes that the
development and introduction of new products is critical to its future success.

   Research and development expenses were $3.3 million for the first quarter of
2000, or 29% of net revenues, compared to $3.5 million, or 32% of net revenues,
for the first quarter of 1999 and $3.4 million, or 27% of net revenues, for the
fourth quarter of 1999. The decrease in research and development in the first
quarter of 2000 compared to the both first and fourth quarters of 1999 is
primarily attributable to a reduction in headcount.

   Selling, General and Administrative

   Selling, general and administrative expenses were $2.6 million for the first
quarter of 2000, or 23% of net revenues, compared to $2.9 million, or 26% of net
revenues, in the first quarter of 1999 and $2.3 million, or 18% of net revenues,
in the

                                       9
<PAGE>   10

fourth quarter of 1999. The first quarter of 2000 expenses compared to both the
first quarter of 1999 and fourth quarter of 1999 remained relatively flat.

   Interest and Other Income and Interest Expense

   Interest and other income was $0.3 million for the first quarter of 2000 and
the first and fourth quarters of 1999. The amounts remained constant for each of
the three quarters due to the relatively stable balance of investments in
interest-earning cash, cash equivalents, and short-term investments. Interest
expense was insignificant for the first quarter of 2000 and the first and fourth
quarters of 1999.

   Provision for Income Taxes

   The Company's provision for taxes on income is based on estimates of the
levels of income and certain deductions expected for the year, which may be
subject to change. The Company's effective tax rate for the first quarter of
2000 was 35%, compared to a benefit of 93% for the same period in 1999, which
differs from the statutory income tax rate primarily due to the impact of the
Federal R&D Tax Credit and California Manufacturers Investment Tax Credit. The
reason for the higher effective tax benefit for the first quarter of 1999 was
due to the greater impact that the Federal R&D Tax Credit and California
Manufacturers Investment Tax Credit had on the 1999 tax provision.

LIQUIDITY AND CAPITAL RESOURCES

   Since 1992, the Company has financed its operations and capital requirements
principally through cash flow from operations and the proceeds from its initial
public offering in October 1994. Operations provided $0.8 million of net cash
during the first quarter of 2000, a decrease of $0.1 million over the first
quarter of 1999.

   Cash provided by investing activities for the first quarter of 2000 is
attributable to the net sale or maturity of short-term investments of $5.3
million offset by capital expenditures of $1.7 million.

   Capital expenditures during the quarter were $1.7 million, primarily for
internal use software and test equipment. The Company expects to spend
approximately an additional $2.0 million over the balance of 2000 on capital
items.

   Financing activities for the first quarter of 2000 consist primarily of
proceeds of $0.9 million from the exercise of options to purchase the common
stock of the Company.

   Working capital amounted to $39.1 million as of March 31, 2000 compared to
$38.3 million as of December 31, 1999. Working capital at March 31, 2000
includes cash and cash equivalents of $12.7 million and short-term investments
of $18.8 million.

   The Company anticipates that its existing cash resources and cash generated
from operations will fund necessary purchases of capital equipment and provide
adequate working capital for at least the next twelve months. The Company's
liquidity is affected by many factors, including, among others, the extent to
which the Company pursues additional wafer fabrication capacity from existing
foundry suppliers or new suppliers, capital expenditures, and the level of the
Company's product development efforts, and other factors related to the
uncertainties of the industry and global economies. Accordingly, there can be no
assurance that events in the future will not require the Company to seek
additional capital sooner or, if so required, that such capital will be
available on terms acceptable to the Company.



OTHER FACTORS AFFECTING FUTURE OPERATING RESULTS

   The Company's quarterly and annual operating results are affected by a wide
variety of factors that could materially and adversely affect revenues and
profitability, including the Company's access to advanced process technologies,
the timing and

                                       10
<PAGE>   11

extent of process development costs, the Company's ability to introduce new
products on a timely basis, the volume and timing of orders received, market
acceptance of the Company's and its customers' products, the timing of new
product announcements and introductions by the Company or its competitors,
changes in the mix of products sold, the timing and extent of research and
development expenses, the availability and cost of wafers from outside
foundries, fluctuations in manufacturing yields, competitive pricing pressures
and cyclical semiconductor industry conditions. A majority of the Company's net
revenues are derived from sales of a limited number of products. Historically,
average selling prices in the semiconductor industry have decreased over the
life of any particular product. Competitive pricing pressures are expected to
continue in the future, especially in the communications market, which includes
the networking sub-market, and may have a material adverse effect on the
Company's gross margin. The Company's business is characterized by short-term
orders and shipment schedules, and customer orders typically can be canceled or
rescheduled without significant penalty to the customer. Due to the absence of
substantial noncancellable backlog, the Company typically plans its production
and inventory levels based on internal forecasts of customer demand, which are
highly unpredictable and can fluctuate substantially. In addition, the Company
is limited in its ability to reduce costs quickly in response to any revenue
shortfalls. As a result of the foregoing or other factors, there can be no
assurance that the Company will not experience material fluctuations in future
operating results on a quarterly or annual basis which would materially and
adversely affect the Company's business, financial condition and results of
operations.

   The markets for the Company's products are characterized by rapid
technological change and frequent new product introductions. To remain
competitive, the Company must develop or obtain access to advanced semiconductor
process technologies in order to reduce die size, increase die performance and
functional complexity, and improve yields. Semiconductor design and process
methodologies are subject to rapid technological change, requiring large
expenditures for research and development. If the Company is unable to develop
or obtain access to advanced wafer processing technologies as they become
needed, or is unable to define, design, develop and introduce competitive new
products on a timely basis, its future operating results will be materially and
adversely affected. In addition, if the Company is unable to transfer and
install such new process technologies to one or more of its foundries in a
timely manner, its business and results of operations could be materially and
adversely affected.

   The Company's market diversification and product development activities have
placed, and could continue to place, a significant strain on the Company's
limited personnel and other resources. The Company's ability to manage any
future growth effectively will require it to integrate its new employees into
its overall operations, to continue to improve its operational, financial and
management systems and to attract, train, motivate and manage its employees
successfully. If the Company's management is unable to manage growth
effectively, the Company's business and results of operations could be
materially and adversely affected.

   The semiconductor industry is characterized by rapid technological change,
cyclical market patterns, significant price erosion, periods of over-capacity
and production shortages, variations in manufacturing costs and yields and
significant expenditures for capital equipment and product development. The
industry has from time to time experienced depressed business conditions. The
Company may experience substantial period-to-period fluctuations in future
operating results due to general semiconductor industry conditions or other
factors.


ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

INTEREST RATE RISK

    The Company's investment portfolio consisted of U.S. government obligations
and commercial paper typically with maturities of less than 18 months. These
securities are subject to interest rate risk and will decline in value if market
interest rates increase. The Company has the ability to hold its fixed income
investments until maturity and, therefore, the Company would not expect to
recognize such an adverse impact in income or cash flows.



FOREIGN CURRENCY EXCHANGE RATE RISK

   The Company has international sales and research and development facilities
and is, therefore, subject to foreign currency rate exposure. The Company's
foreign currency risks are mitigated principally by maintaining only minimal
foreign currency

                                       11
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balances. To date, the exposure to the Company related to exchange rate
volatility has not been significant. However, there can be no assurance that
there will not be a material impact in the future.





                                       12
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                           PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

   In December 1995, Pioneer Magnetics, Inc. ("Pioneer") filed a complaint in
the Federal District Court for the Central District of California alleging that
certain of the Company's integrated circuits violate a Pioneer patent. Pioneer
is seeking monetary damages and an injunction against such alleged patent
violation. The Company has denied any infringement and filed a counter-claim
seeking invalidity of the patent. The court held a patent claim construction
hearing on November 9, 1998. The court subsequently issued a claim construction
opinion that is favorable to Micro Linear. The court also required additional
briefing from Pioneer. The final claim construction hearing took place on July
19, 1999. The court issued a claim construction order favorable to Micro Linear.
The parties filed a stipulated judgement of non-infringement, which has resulted
in a termination of the district court action against Micro Linear. Pioneer has
appealed. No hearing date on the appeal has been set.

   On February 24, 1997, a former employee of Micro Linear filed a complaint in
the Superior Court of California, County of Santa Clara, alleging breach of
contract and employment discrimination. On June 5, 1997, the case was dismissed
and the parties agreed to submit the dispute to arbitration. To date no
arbitration date had been scheduled. The Company denies all liability and
intends to vigorously defend its actions in the arbitration.

   On September 4, 1998, NetVantage, Inc. ("NetVantage") filed a complaint
relating to the Company's sale of part ML6692 to NetVantage through the
Company's distributor, Insight Electronics, in the Superior Court of California,
County of Los Angeles. On October 1, 1999 the parties reached an out of court
settlement of this action. The terms of this settlement are confidential,
however, the Company took a $1.24 million charge related to this settlement in
1999 and the action has been dismissed.

   On December 16, 1998, Accton Technology Corporation ("Accton") filed a
complaint relating to the Company's sale of part ML6692 to Accton, against the
Company in the Superior Court of California, County of Santa Clara, alleging
causes of action for: (1) breach of contract, (2) breach of express warranty,
(3) breach of implied warranty of merchantability, (4) breach of implied
warranty of fitness for particular purpose, (5) fraud and deceit-concealment,
(6) negligent misrepresentation, (7) negligent interference with economic
advantage, and (8) declaratory relief to establish the right to implied
contractual indemnity. Accton seeks compensatory damages in excess of $7.0
million, exemplary damages according to proof, attorneys' fees and costs, and
prejudgment and postjudgment interest. Discovery commenced in May 1999. Both
parties have propounded and responded to extensive written discovery requests.
Hewlett-Packard Company, Accton's customer, has also produced documents in
response to the Company's deposition subpoena. The action is scheduled to
commence trial on June 5, 2000. At the initial status conference held on July
13, 1999, the court ordered the parties to mediation. An initial mediation
session was held on December 16, 1999. A second session took place on March 14,
2000. No resolution was reached at either session.

   The Company intends to contest these actions vigorously, however, there can
be no assurance that such actions will be resolved in the Company's favor or
that an unfavorable resolution would not materially adversely effect the
Company's financial condition or results of operations.

   From time to time, the Company has received, and in the future it may
receive, correspondence from certain vendors, distributors, customers or
end-users of its products regarding disputes with respect to contract rights,
product performance or other matters that occur in the ordinary course of
business. There can be no assurance that any of such disputes will not
eventually result in litigation or other actions involving the Company or as to
the outcome of such disputes.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

   (a) Exhibits

   27.1 Financial Data Schedule

   (b) Reports on Form 8-K

       None


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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.
















                                MICRO LINEAR CORPORATION

Date: May 17, 2000              By: /s/ David L. Gellatly
                                    --------------------------------------------
                                    David L. Gellatly
                                    Chairman, Chief Executive Officer
                                    and President
                                    (Principal Executive Officer)
                                    Chief Financial Officer
                                    (Principal Financial and Accounting Officer)


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                                 EXHIBIT INDEX

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

 27.1                       Financial Data Schedule