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

                                   FORM 10-QSB

(Mark One)
[x]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934
       For the quarterly period ended September 30, 2002

[ ]  TRANSITION REPORT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934
      For the Transition Period from _______________ TO _______________.

                                    333-44747
                            (Commission File Numbers)

                        ROSEDALE DECORATIVE PRODUCTS LTD.
             (Exact name of registrant as specified in its charter)

   Ontario, Canada                                            5110
(State or other jurisdiction of                   (Primary Standard Industrial
 incorporation or organization)                     Classification Code Number)


                               731 Millway Avenue
                                Concord, Ontario
                                 Canada L4K 3S8
                    (Address of principal executive offices)

                                 (905) 669-8909
                         (Registrants' telephone number,
                              including area code)

                                 Not Applicable
              (Former name, former address and former fiscal year,
                         if changed since last report)

     Indicate by check mark whether the  Registrants  (1) have filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
Registrants  were required to file such  reports),  and (2) have been subject to
such filing requirements for the past 90 days. YES [ X ] NO[ ]

     As of September 30, 2002,  2,755,514  shares of Common Stock,  no par value
per share, of Rosedale Decorative Products Ltd. were issued and outstanding.
<PAGE>

                                     PART I
                              FINANCIAL INFORMATION

Item 1.  Financial Statements



                        ROSEDALE DECORATIVE PRODUCTS LTD.

                    INTERIM CONSOLIDATED FINANCIAL STATEMENTS

                               SEPTEMBER 30, 2002

                                   (Unaudited)


                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
<S>                                                                                                       <C>
       Interim Consolidated Balance Sheets as of September 30, 2002 and
        December 31, 2001                                                                                  2 - 3

       Interim Consolidated Statements of Operations for the three months ended
        September 30, 2002 and September 30,2001                                                             4

       Interim Consolidated Statements of Operations for the nine months ended
        September 30, 2002 and September 30,2001                                                             5

       Interim Consolidated Statements of Cash Flows for the nine months ended
       September 30, 2002 and September 30, 2001                                                           6 - 7

       Interim Consolidated Statements of Stockholders' Equity for the nine months
        ended September 30, 2002 and December 31, 2001                                                       8

       Condensed Notes to Interim Consolidated Financial Statements                                       9 - 10
</TABLE>

                                       1
<PAGE>
ROSEDALE DECORATIVE PRODUCTS LTD.
Interim Consolidated Balance Sheets
As of September 30, 2002 and December 31, 2001
(Amounts expressed in US dollars)
(Unaudited)
                                           2002           2001
                                             $              $

                           ASSETS
       CURRENT ASSETS

    Cash .............................    1,079,768    1,897,453
    Accounts receivable ..............    4,529,918    3,811,530
    Inventory ........................    4,754,902    5,616,597
    Prepaid expenses and sundry assets      323,194      368,718
    Income taxes recoverable .........       19,891       41,858

                                         ----------   ----------
                                         10,707,673   11,736,155



    MORTGAGES RECEIVABLE .............      310,912      309,819

PROPERTY, PLANT AND EQUIPMENT ........    3,818,855    3,675,749


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





                                         14,837,440   15,721,723
                                         ==========   ==========

          See condensed notes to the consolidated financial statements

                                        2
<PAGE>
ROSEDALE DECORATIVE PRODUCTS LTD.
Interim Consolidated Balance Sheets
As of September 30, 2002 and December 31, 2001
(Amounts expressed in US dollars)
(Unaudited)
<TABLE>
<CAPTION>
                                                                     2002          2001

                                                                      $              $

                                               LIABILITIES
CURRENT LIABILITIES
<S>                                                                <C>            <C>
    Bank indebtedness ........................................     4,981,414      4,886,846
    Accounts payable and accrued expenses ....................     3,460,543      4,226,715
           Due to Stockholders & Directors ...................       932,483      1,150,573
                                                                  -----------    -----------

                                                                   9,374,440     10,264,134



DEFERRED INCOME TAXES ........................................       282,132        281,140
                                                                  -----------    -----------

                                                                   9,656,572     10,545,274
                                                                  -----------    -----------

                                          STOCKHOLDERS' EQUITY

COMMON STOCK .................................................     5,029,355      5,029,355

ADDITIONAL PAID-IN CAPITAL ...................................       142,314        142,314

ACCUMULATED OTHER COMPREHENSIVE LOSS .........................      (546,711)      (565,122)

RETAINED EARNINGS ............................................       555,910        569,902
                                                                  -----------    -----------

                                                                   5,180,868      5,176,449
                                                                  -----------    -----------

                                                                  14,837,440     15,721,723
                                                                  ===========    ===========
</TABLE>
          See condensed notes to the consolidated financial statements

                                        3
<PAGE>
ROSEDALE DECORATIVE PRODUCTS LTD.
Interim Consolidated Statements of Operations
For the period ended September 30
(Amounts expressed in US dollars)
(Unaudited)
                                                Three-months   Three-months
                                                   Ended          Ended
                                                September 30,   September 30,
                                                    2002           2001

                                                      $             $

SALES .........................................    5,286,780     4,371,365

COST OF SALES .................................    3,460,221     2,766,296
                                                  -----------   -----------

GROSS PROFIT ..................................    1,826,559     1,605,069
                                                  -----------   -----------

OPERATING EXPENSES

    General and administrative ................      605,699       670,177
    Selling ...................................    1,047,700       763,883
    Design studio .............................      141,458        64,681
    Book development costs ....................       31,745          (330)
    Amortization ..............................      324,345       237,674
                                                  -----------   -----------

TOTAL OPERATING EXPENSES ......................    2,150,947     1,736,085
                                                  -----------   -----------

OPERATING INCOME (LOSS) .......................     (324,388)     (131,016)

    Interest expense ..........................      (73,692)     (106,692)
    Exchange loss on Foreign Exchange Contracts     (200,046)     (109,445)
                                                  -----------   -----------

LOSS BEFORE INCOME TAXES ......................     (598,126)     (347,153)

    Income taxes recoverable ..................      221,930          --
                                                  -----------   -----------

NET LOSS ......................................     (376,196)     (347,153)
                                                  ===========   ===========

Basic and diluted Net Loss Per Share ..........        (0.14)        (0.13)
                                                  ===========   ===========

Weighted average number of common shares
    Outstanding ...............................    2,755,514     2,755,514
                                                  ===========   ===========

          See condensed notes to the consolidated financial statements

                                        4
<PAGE>
ROSEDALE DECORATIVE PRODUCTS LTD.
Interim Consolidated Statements of Operations
For the period ended September 30
(Amounts expressed in US dollars)
(Unaudited)
<TABLE>
<CAPTION>
                                                  Nine-months    Nine-months
                                                    Ended          ended
                                                  September 30,  September 30,
                                                     2002           2001

                                                      $              $
<S>                                                <C>            <C>
SALES .........................................    16,540,607     13,504,124

COST OF SALES .................................    10,181,356      7,797,261
                                                  ------------    ------------

GROSS PROFIT ..................................     6,359,251      5,706,863
                                                  ------------    ------------

OPERATING EXPENSES

    General and administrative ................     1,995,175      2,026,374
    Selling ...................................     2,594,474      2,395,613
    Design studio .............................       577,925        404,318
    Book development costs ....................       (41,943)        50,504
    Amortization ..............................       991,624        713,485
                                                  ------------    ------------

TOTAL OPERATING EXPENSES ......................     6,117,255      5,590,294
                                                  ------------    ------------

OPERATING INCOME ..............................       241,996        116,569

    Interest expense ..........................      (182,047)      (352,857)
    Exchange loss on Foreign Exchange Contracts       (73,941)      (292,190)
                                                  ------------    ------------

 LOSS BEFORE INCOME TAXES .....................       (13,992)      (528,478)

    Income taxes ..............................          --             --
                                                  ------------    ------------

NET LOSS ......................................       (13,992)      (528,478)
                                                  ============    ============

Basic and diluted Net Loss Per Share ..........         (0.01)         (0.19)
                                                  ============    ============

Weighted average number of common shares
    Outstanding ...............................     2,755,514      2,758,831
                                                  ============    ============
</TABLE>
          See condensed notes to the consolidated financial statements

                                        5
<PAGE>
ROSEDALE DECORATIVE PRODUCTS LTD.
Interim Consolidated Statements of Cash Flows
(Amounts expressed in US dollars)
(Unaudited)
<TABLE>
<CAPTION>
                                                                    Nine-months ended  Nine-months ended
                                                                       September 30       September 30,
                                                                           2002              2001

                                                                              $              $

       Cash flows from operating activities:

<S>                                                                           <C>            <C>
           Net Loss ......................................................    (13,992)       (528,478)
                                                                           ------------    ------------

           Adjustments to reconcile net loss to net cash used in operating
                activities:

           Amortization of property, plant and equipment .................    991,624         637,537
           Amortization of deferred product costs ........................         --         325,422
           Exchange loss on foreign exchange contracts ...................     73,941         292,190
Increase in accounts receivable ..........................................   (712,437)       (663,463)
           Decrease (increase) in inventory ..............................    890,884        (304,052)
           Decrease in prepaid expenses and sundry assets ................     47,323         390,508
           Decrease in accounts payable and accrued expenses .............   (863,331)       (792,334)
           Increase in income taxes payable/recoverable ..................     22,350           2,082
                                                                           ------------    ------------

                Total adjustments ........................................    450,354        (112,110)
                                                                           ------------    ------------

           Net cash provide by (used in) operating activities ............    436,362        (640,588)
                                                                           ------------    ------------

       Cash flows from investing activities:

           Deferred product costs incurred ...............................         --        (286,214)
           Purchases of property, plant and equipment .................... (1,123,145)       (779,172)
                                                                           ------------    ------------

           Net cash used in investing activities ......................... (1,123,145)     (1,065,386)
                                                                           ------------    ------------
</TABLE>
          See condensed notes to the consolidated financial statements

                                                           6
<PAGE>
ROSEDALE DECORATIVE PRODUCTS LTD.
Interim Consolidated Statements of Cash Flows
(Amounts expressed in US dollars)
(Unaudited)
<TABLE>
<CAPTION>
                                                       Nine-months ended  Nine-months ended
                                                          September 30,       September 30,
                                                             2002                2001

                                                              $                   $

Cash flows from financing activities:
<S>                                                            <C>            <C>
     Proceeds from bank indebtedness ...................       78,148         416,906
     Repayment of loans with affiliated companies ......     (224,512)         (3,999)
     Purchase for Treasury Stock .......................         --            (8,728)
     Repayment of from directors loans .................         --           (33,354)
     Repayment of Long Term Debt .......................         --          (130,005)
                                                            -----------     -----------

     Net cash provided by (used in) financing activities     (146,364)        240,820
                                                            -----------     -----------

Effect of foreign currency exchange rate changes .......       15,462         (89,059)
                                                            -----------     -----------

Net decrease in cash and cash equivalents ..............     (817,685)     (1,554,213)

Cash and cash equivalents, January 1 ...................    1,897,453       2,524,394
                                                            -----------     -----------

End of nine month period ended September 30 ............    1,079,768         970,181
                                                            ===========     ===========

Income taxes paid ......................................       30,671          22,681
                                                            ===========     ===========

Interest paid ..........................................      203,250         316,464
                                                            ===========     ===========
</TABLE>
          See condensed notes to the consolidated financial statements

                                        7
<PAGE>
ROSEDALE DECORATIVE PRODUCTS LTD.
Interim Consolidated Statements of changes in Stockholders' Equity
(Amounts expressed in US dollars)
(Unaudited)
<TABLE>
<CAPTION>
                                  Common                                                                Accumulated
                                   Stock       Common       Additional                                      Other
                                Number of      Stock         Paid-in      Retained     Comprehensive      Comprehensive
                                  Shares       Amount        Capital      Earnings      Income (loss)     Income (loss)
                               ------------  ------------   ------------  ------------  ----------------- ---------------
                                                      $              $             $            $                $
<S>                                   <C>         <C>           <C>              <C>         <C>                <C>
     Balance as of December 31,
         2000                     2,764,314     5,038,083        142,314     2,002,846              -          (195,670)

     Purchase of treasury stock      (8,800)       (8,728)             -             -              -                 -
     Foreign currency translation         -             -              -             -       (369,452)         (369,452)

        Net loss for the year             -             -              -    (1,432,944)    (1,432,944)                -


     Balance as of December 31,
         2001                     2,755,514     5,029,355        142,314       569,902     (1,802,396)         (565,122)



     Foreign currency translation         -             -              -             -         18,411            18,411

     Net loss for the
         nine-month period to
         September 30, 2002               -             -              -       (13,992)       (13,992)                -



     Balance as of September,
         2002                     2,755,514     5,029,355        142,314       555,910          4,419          (546,711)

</TABLE>
          See condensed notes to the consolidated financial statements

                                        8
<PAGE>
ROSEDALE DECORATIVE PRODUCTS LTD.
Condensed Notes to Consolidated Financial Statements
As of September 30,2002
 (Amounts expressed in US dollars)
 (Unaudited)

1.   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     The  accompanying  unaudited  consolidated  financial  statements have been
     prepared  in  accordance  with  the  instructions  to Form  10-Q and do not
     include all the  information and footnotes  required by generally  accepted
     accounting principles for complete financial statements.  In the opinion of
     management,   all  adjustments   (consisting  of  all  recurring  accruals)
     considered  necessary for fair presentation  have been included.  Operating
     results  for the  interim  periods are not  necessarily  indicative  of the
     results that may be expected for the year ended December 31, 2002.  Interim
     financial  statements  should  be read in  conjunction  with the  Company's
     annual audited  financial  statements.  The company's 2001 annual financial
     statements  and 2002  10Q's will be revised  upon  completion  of the SEC's
     review of the Proxy Statement (note 2). The adjustments  agreed upon by the
     company and the SEC to date (note 3) have been  reflected in these  interim
     consolidated financial statements.

     The unaudited  consolidated  financial  statements  include the accounts of
     Rosedale  Decorative  Products  Ltd.  ("the  company") and its wholly owned
     subsidiaries,  Rosedale  Wallcoverings  and Fabrics Inc.  ("Rosedale")  and
     Ontario Paint and Wallpaper Limited ("Ontario"), respectively.

          All  material   inter-company  accounts  and  transactions  have  been
     eliminated.


2.   PROPOSED SALE OF SUBSIDIARY

     In July 2002,  the Company filed a Proxy  Statement with the Securities and
     Exchange  Commission  for the  approval  by  shareholders  of the sale of a
     wholly owned subsidiary, Rosedale Wallcoverings & Fabrics Inc. ("Rosedale")
     to the Chairman of the Board and Chief Executive Officer, Alan Fine.

     The terms and  conditions  and  impact to the  Company  resulting  from the
     proposed  transaction  is fully set out in pro-forma  financial  statements
     included in the aforementioned Proxy Statement.

     The  Proxy  Statement  is  currently  under  review by the  Securities  and
     Exchange Commission.


3.   PRIOR PERIOD ADJUSTMENTS

     The SEC is currently  reviewing the Proxy Statement  referred to in Note 2.
     As a  result  of  this  review,  the  SEC had  comments  pertaining  to the
     accounting for prepaid and deferred  expenses  relating to design costs and
     book subsidy, the evaluation of the provision for doubtful accounts and the
     amortization  period for cylinders  included in capital assets, as reported
     in the company's  2001 10K and 2002  10Q's.The  SEC's position was that the
     prepaid and  deferred  expenses  relating to design  costs and book subsidy
     should be expensed.  In addition,  the SEC requested that the allowance for
     doubtful   accounts   and  the   amortization   period  for   cylinders  be
     re-evaluated.  Based on the comments from the SEC and subsequent discussion
     with the reviewer,  the company  accepted and corrected the  accounting for
     prepaid and

                                       9
<PAGE>
     deferred  expenses  relating to design costs and book subsidy and wrote off
     the  amounts as prior  period  adjustments.  In  addition,  the company has
     re-evaluated  the  provision  for  doubtful  accounts  and has  decided  to
     increase the  provision by $ 207,182  attributable  mainly to one customer.
     The  company  is  currently  reviewing  the  amortization  period  for  the
     cylinders  and the  results  are  expected  to be  submitted  to the SEC on
     November 15, 2002.


     The SEC review may result in additional material adjustments.


     RESTATEMENT OF PRIOR PERIOD FINANCIAL STATEMENTS

     Deferred  product  costs and  certain  prepaid  expenses  relating  to book
     subsidy and design costs  amounting to $ 636,477 have been expensed and the
     provision  for  doubtful  accounts has been  increased by $ 207,182.  These
     adjustments have been applied retroactively.

     POTENTIAL RESTATEMENT TO PRIOR PERIOD FINANCIAL STATEMENTS

     The amortization  period for cylinders  included in capital assets,  may be
     revised  as a result  of the  company's  evaluation.  If an  adjustment  is
     necessary to the amortization  period, it may have a material impact on the
     company's financial statements.

     The  company  will file an amended  10K for  December  31,  2001 as well as
     amended 10Q's for all quarters in 2002 on completion of the SEC review.


3.   CONTINGENCIES


     a)   Rosedale has been  re-assessed  by Canada  Customs and Revenue  Agency
          ("CCRA") and the  Province of Ontario for fiscal years ended  December
          31, 1993 and December 31, 1994 for additional  corporate  income taxes
          estimated  to  be   $863,000.   The  company  has  objected  to  these
          re-assessments  and has no obligation  to pay the portion  relating to
          CCRA  in the  amount  of  $600,000  until  the  objections  have  been
          processed.  Since  the  company  considers  the  re-assessments  to be
          incorrect, no liability has been set up in the accounts. Should all or
          part of the  re-assessments  be upheld,  the  additional  income taxes
          would be taken into account in the year of occurrence.


          The company has retained a firm of tax  specialists  to represent them
          in  presenting  their  case to  CCRA  and  currently  the  Notices  of
          Objections are being considered by the Chief of Appeals.


          As at September  30, 2002,  Rosedale  made  payments in respect to the
          above income tax re-assessments amounting to approximately $229,000 to
          the  Province  of Ontario.  This  amount has been  included in prepaid
          expenses and sundry assets.


     b)   The  company  has  guaranteed  the   indebtedness  of  two  affiliated
          companies  (1216748  Ontario Inc. and 1217576  Ontario  Inc.,  jointly
          owned by Alan Fine and Sid Ackerman) in the amount of $536,000 through
          general  security  agreements  ranking  behind  the  National  Bank of
          Canada.  As at September 30, 2002, the  indebtedness of the affiliated
          companies amounted to approximately $338,000.


     c)   The  company  has  guaranteed   loans  secured  by  general   security
          agreements  loans  made  by  the  Laurentian  Bank  of  Canada  to two
          affiliated  companies (1369597 Ontario Inc. controlled by Sid Ackerman
          and 1369598  Ontario  Inc.  controlled  by Alan Fine) in the amount of
          approximately $1,300,000.

     d)   The  company  has  issued  standby  letters of credit in favour of the
          Laurentian Bank of Canada in the amount of $376,000.


                                       10
<PAGE>
                     MANAGEMENTS DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS


                    PRIVATE SECURITIES LITIGATION REFORM ACT

         The information contained in this Report on Form 10-QSB and in other
public statements by the Company and Company officers include or may contain
certain forward-looking statements. When used in this Report or in such
statements, the words "estimate," "project," "intends," "expects," "believes"
and similar expressions are intended to identify forward-looking statements
regarding events and financial trends which may affect the Company's future
operating results and financial position. Such statements are not guarantees of
future performance and are subject to risks and uncertainties that could cause
the Company's actual results and financial position to differ materially from
those included within the forward-looking statements. Readers are cautioned not
to place undue reliance on these forward-looking statements, which speak only as
of the date made. The Company undertakes no obligation to publicly release the
results of any revision to these forward-looking statements to reflect events or
circumstances after the date made or to reflect the occurrence of unanticipated
events.



Results of Operation

    Three months ended September 30, 2002 as compared to three months ended
September 30, 2001.

     Revenues for the three months ended September 30, 2002 were $5,286,780, a
20.9% increase over prior year revenues of $4,371,365. This increase resulted
mainly from the launch of new collections in the U.S. market in both wallpaper
and fabric as the Canadian market remains weak. The Export market continued to
grow during the quarter with additional business coming from the U.K., Mexico,
Australia and South America.

     Gross profits for the three months ended September 30, 2002 was $1,826,559
or 34.5% of Sales, as compared to the same period one-year ago of $1,605,069 or
36.7% of Sales. This increase in gross profit is primarily attributable to
increased sales in the U.S. The drop in margin as a percentage of Sales was due
to the large clearance of Inventory in the quarter.

General and administrative expenses for the Company decreased by 9.6%, to
$605,699 for the three months period ended September 30, 2002 from $670,177 for
the three months ended September 30, 2001. Wages accounted for the majority of
this decrease as the requirements of the retail store were rationalized with
savings being achieved.

     Selling expenses have increased by 37.2% to $1,047,700 for the three-month
period ended September 30, 2002 as compared to $763,883 for the same period last
year. This increase relates to the Sherwin Williams bin expense incurred in this
quarter in the amount of $270,000. Other selling expenses have remained
relatively stable year over year.

                                       11
<PAGE>

     Design studio expenses for the Company  increased to $141,458 for the three
months ended  September  30, 2002 versus  $64,681 for the same period last year.
Wages  accounted  for the  majority of this  increase  as the  Ontario  division
started its own design studio during 2001.

     Book development costs and subsidy for the three-month period ended
September 30, 2002 was $31,745 compared to an income of $330 for the same period
last year. This increase in expense can be attributed to additional costs
incurred on collections launched this quarter. Also, book subsidy has been
increasing due to increased costs that cannot be passed on to the customers as
they are being more selective on books and book prices.We believe that it is
imperative that we keep our books at display counters in the marketplace, as
these sample books are our silent salesperson.

     The operating loss for the three months ended September 30, 2002 was
$324,388 as compared to a loss of $131,016 for the three months ended September
30, 2001. This decrease is primarily attributable to the increase in selling
expenses and the drop in the gross margin percentage.

     Interest expense for the Company for the three months ended September 30,
2002 decreased to $73,692 from $106,692 for the three months ended September 30,
2001. This decrease in interest expense is primarily attributable to lower
interest rates and decreased average borrowings during the period and the
reduction in long term debt.

     The exchange loss on foreign exchange contracts for the three months ended
September 30, 2002 was $200,046 as compared to $109,445 for the same period last
year. This occurred as the Canadian dollar weakened by almost 0.07 cents during
the quarter decreasing the value of the foreign exchange contracts held at the
end of the period.

     The net loss for the three months ended September 30, 2002 was $376,196 as
compared to $347,153 for the three months ended September 30, 2001. The
improvement in Sales was more than offset by increased selling expenses and the
exchange loss on Foreign Exchange Contracts.

    Basic and fully diluted loss per share for the three months ended September
30, 2002 were ($0.14) compared to ($0.13) for the same period last year.



Nine months ended September 30, 2002 as compared to Nine months ended September
30, 2001.

     Revenues for the nine months ended September 30, 2002 were $16,540,607, a
22.5% increase over prior year revenues of $13,504,124. This increase resulted
mainly from an increase in sales in the U.S. and Export markets of new
collections of wallpaper and fabric. The U.S. and Canadian economy continues to
struggle, as consumer confidence has not rebounded as yet.

     Gross profit as a percentage of revenue for the nine months ended September
30, 2002 was 38.4%, as compared to the same period one-year ago of 42.2%. This
decrease in gross profit margins can be attributed to a large clearing of slow
moving and obsolete inventory.

                                       12
<PAGE>
We continue to implement price increases on newly
introduced collections to offset the increase in costs received from suppliers.


     General and administrative expenses for the Company decreased by 1.5%, to
$1,995,175 for the nine months period ended September 30, 2002 from $2,026,374
for the nine months ended September 30, 2001. Savings on wages accounted for the
majority of the difference.


     Selling expenses have increased by 8.3% to $2,594,474 for the nine-month
period ended September 30, 2002 as compared to $2,395,613 for the same period
last year. The increase in bin expense in the third quarter of 2002 relating to
the Sherwin Williams stocking deal accounts for this increase. Bin expense is
the upfront cost of purchasing space in Sherwin Williams stores to display and
sell your product from. To obtain this business, a supplier has no choice but to
purchase this space.

     Design studio expenses for the Company increased by 42.9% to $577,925 for
the nine months ended September 30, 2002 versus $404,318 for the same period
last year. This relates to the costs of the new studio introduced by the Ontario
division in 2001 and increased travel costs as we continue to source production
overseas as there is insufficient capacity in North America.

     Rosedale develops wallpaper and fabric sample books, which are created for
each collection and sold through distributors. The majority of expenditures for
the creation of sample books are incurred in the quarter before the introduction
of a collection. Some of these expenditures are incurred as early as eight to
ten months in advance. Revenues generated from the sales of sample books are
netted from the costs incurred in the same period and the net amount is shown on
the income statement. Because expenditures are made in the quarter before the
launch of a collection, there is not always a matching of revenues and expenses,
e.g. costs for a January launch would be recorded in the previous year. The
Company ensures that there are firm orders in place from customers before
significant expenditures are incurred to produce the sample books. Therefore,
there is little speculative risk in their production. Book development produced
revenue for the nine-month period ended September 30, 2002 of $41,943 compared
to a cost of $50,504 for the same period last year. This decrease in expense can
be attributed to lowering costs of manufacturing the books.

          Operating income for the nine months ended September 30, 2002
increased 107.6% to $241,996 from $116,569 for the nine months ended September
30, 2001. This relates to our increasing revenues, which was partially offset by
increased expenses as compared to the previous year.

     Interest expense for the Company for the nine months ended September 30,
2002 decreased to $182,047 from $352,857 for the nine months ended September 30,
2001. This decrease in interest expense is attributable to lower rates of
borrowing, decreased average borrowings for the operating companies, payment of
the long term debt and the waiving of interest on the loans to shareholders.

     The exchange loss on foreign exchange contracts relates to the FASB
requirement that the ineffective portion of gain or losses attributable to cash
flow hedges be reported in earnings. As the Canadian dollar has fluctuated
dramatically through the first nine months of 2002, the

                                       13
<PAGE>
company  engaged in  contracts  to protect  our  margins  on U.S.  sales.  These
contracts  have had a negative  impact on net income.  The exchange loss for the
nine months ended September 30, 2002 was $73,941 as compared to an exchange loss
of $292,190 for the nine months ended September 30, 2001.

     The net loss for the nine months ended September 30, 2002 was $13,992 as
compared to a net loss of $528,478 for the nine months ended September 30, 2001.
Increased revenue, a reduction in the foreign exchange contract loss and lower
interest expense were partially offset by increased expenses.

    Basic and fully diluted loss per share for the nine months ended September
30, 2002 were ($0.01) compared to $(0.19) for the same period last year.
Earnings per share were calculated based on the weighted average number of
shares outstanding as of September 30, 2002 of 2,755,514 and 2,758,831 shares
outstanding as of September 30, 2001.


Liquidity and Capital Resources

     The Company had a negative net change in cash of $817,685 for the nine
months ended September 30, 2002. Use of cash for the period was primarily
attributable to an increase in accounts receivable, a reduction in accounts
payable, which was somewhat offset by a decrease in inventories.

     Cash flows used in investing activities for the nine months ending
September 30, 2002 were $1,123,145. This reflected planned capital addition for
cylinders, designs and engravings for new collections. It is the Company's
intention to continue to utilize a good portion of these funds to develop new
product lines of wallpaper and fabric, in addition to continuing the development
of our floor-coverings, ceiling tiles, and area rug product categories.

Item 3.     Controls and Procedures

         Based on their most recent review, which was completed within 90 days
of the filing of this report, the Company's principal executive officer and
principal financial officer have concluded that the Company's disclosure
controls and procedures are effective to ensure that information required to be
disclosed by the Company in the reports that it files or submits under the
Securities Exchange Act of 1934, as amended, is accumulated and communicated to
the Company's management, including its principal executive officer and
principal financial officer, as appropriate to allow timely decisions regarding
required disclosure and are effective to ensure that such information is
recorded, processed, summarized and reported within the time periods specified
in the SEC's rules and forms. There were no significant changes in the Company's
internal controls or in other factors that could significantly affect those
controls subsequent to the date of their evaluation.

                                       14
<PAGE>
                                     PART II
                                OTHER INFORMATION


Item 1.  Legal Proceedings

         None.

Item 2.  Changes in Securities and Use of Proceeds

         None.

Item 3.  Defaults Upon Senior Securities

         None.

Item 4.  Submission of Matters to a Vote of Security Holders

         None

Item 5.  Other Information

         None.

Item 6.  Exhibits and Reports on Form 8-K

         (a)  Exhibits

              Exhibit 31.1    Certification of Principal Executive Officer
              Exhibit 31.2    Certification of Principal Financial Officer
              Exhibit 32.1    Certification Pursuant to 18 U.S.C. Section 1350
              Exhibit 32.2    Certification Pursuant to 18 U.S.C. Section 1350




         (b) Reports on Form 8-K

                                       15
<PAGE>

                                   SIGNATURES

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


                                            ROSEDALE DECORATIVE PRODUCTS LTD.


Date:    November 12, 2002                  By:/s/Alan Fine
                                               ---------------------------------
                                                 Alan Fine,
                                                 Chief Executive Officer

Date:    November 12, 2002                  By:/s/Norman G. Maxwell
                                               ---------------------------------
                                                  Norman G. Maxwell,
                                                  Chief Financial Officer,
                                                  Secretary and Treasurer