QUARTERLY REPORT FOR SMALL BUSINESS ISSUERS
                 SUBJECT TO THE 1934 ACT REPORTING REQUIREMENTS

                                   FORM 10-QSB

                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                  For the quarterly period ended March 31, 2000

                                       OR

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

                       Commission File Number: 001-14005

                            FRISBY TECHNOLOGIES, INC.
             (Exact Name of Registrant as Specified in its Charter)

                  Delaware                                    62-1411534
        (State or other Jurisdiction of                   (I.R.S. Employer
       Incorporation or Organization)                   Identification Number)

                             3195 Centre Park Blvd.
                             Winston-Salem, NC 27107
              (Address of Principal Executive Offices and Zip Code)
                                 (336) 784-7754
              (Registrant's telephone number, including area code)



Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

                                Yes X No ________

Number of shares  outstanding of the issuer's Common Stock,  par value $.001 per
share, as of April 30, 2000: 5,775,413 shares.



<PAGE>


                            FRISBY TECHNOLOGIES, INC.


                                      INDEX
<TABLE>
<S>               <C>                                                                                      <C>


                                                                                                           PAGE NO.

Part I            Financial Information

Item 1.           Consolidated Financial Statements

                  Consolidated Balance Sheets - March 31, 2000 (unaudited) and
                  December 31, 1999                                                                           3

                  Consolidated Statements of Operations - Three Month Period Ended
                  March 31, 2000 (unaudited) and March 31, 1999
                  (unaudited)                                                                                 4

                  Consolidated Statement of Stockholders' Equity - Three Month Period
                  Ended March 31, 2000 (unaudited)                                                            5

                  Consolidated Statements of Cash Flows - Three Month Period Ended
                  March 31, 2000 (unaudited) and March 31, 1999 (unaudited)                                   6

                  Notes to Consolidated Financial Statements - March 31, 2000(unaudited)                      7

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

Part II           Other Information                                                                          12

                  Signatures                                                                                 14
</TABLE>




<PAGE>


                         PART I - FINANCIAL INFORMATION
                          Item 1. Financial Statements

                            Frisby Technologies, Inc.
                           Consolidated Balance Sheets
<TABLE>
<S>                                                                           <C>                     <C>


                                                                              March 31, 2000          December 31, 1999
                                                                              --------------          -----------------
                                                                               (unaudited)
Assets
Current assets:
   Cash and cash equivalents                                                         $225,113             $1,171,579
   Accounts receivable, less allowance for doubtful accounts                        2,540,584              1,849,436
   Inventory                                                                        1,799,064              1,097,049
   Prepaid and other current assets                                                   600,992                559,820
                                                                           ---------------------    -------------------
Total current assets                                                                5,165,753              4,677,884
Property and equipment, net                                                           950,186                604,921
Intangible assets, less accumulated amortization                                    2,760,915              2,838,603
Other assets                                                                           76,404                298,439
                                                                           ---------------------    -------------------
Total assets                                                                       $8,953,258             $8,419,847
                                                                           =====================    ===================
Liabilities and stockholders' equity
Current liabilities:
   Accounts payable                                                                $2,715,311             $1,622,280
   Note payable - short term                                                          942,000                549,981
   Accrued expenses and other current liabilities                                     546,043                239,999
   License fees payable                                                               168,523                282,565
   Deferred license revenue                                                                 0                 26,254
                                                                           ---------------------    -------------------
Total current liabilities                                                           4,371,877              2,721,079
Accrued license agreement costs                                                       113,000                120,250
Other liability                                                                     1,300,000              1,300,000
                                                                           ---------------------    -------------------
Total liabilities                                                                   5,784,877              4,141,329
Minority interest                                                                     104,057
Commitments and contingencies
Stockholders' equity:
   Common Stock, $.001 par value; 10,000,000 shares authorized;
    5,775,413 and 5,748,113shares issued and outstanding, respectively                  5,775                  5,748
   Additional paid-in capital                                                      15,006,511             14,888,201
   Accumulated deficit                                                            (11,947,962)           (10,615,431)
                                                                           ---------------------    -------------------
Total stockholders' equity                                                          3,064,324              4,278,518
                                                                           ---------------------    -------------------
Total liabilities and stockholders' equity                                        $ 8,953,258            $ 8,419,847
                                                                           =====================    ===================

See accompanying notes.
</TABLE>



<PAGE>


                            Frisby Technologies, Inc.
                      Consolidated Statements of Operations
                                   (Unaudited)
<TABLE>
<S>                                                                   <C>                          <C>



                                                                                  Three month period ended
                                                                                         March 31,
                                                                       -----------------------------------------------
                                                                              2000                       1999
                                                                       -------------------        --------------------

Revenues:
  Product sales                                                          $     2,405,980             $     830,420
  Research and development projects                                               21,000                   101,375
  Licenses and royalties                                                          36,250                    95,031
                                                                       -------------------        --------------------
Total revenues                                                                 2,463,230                 1,026,826
                                                                       -------------------        --------------------

Cost of sales:
   Product sales                                                               1,817,028                   657,200
   Research and development projects                                                 ---                    81,935
   Licenses and  royalties                                                       156,042                   106,457
                                                                       -------------------        --------------------
Total cost of sales                                                            1,973,070                   845,592
                                                                       -------------------        --------------------
Gross profit                                                                     490,160                   181,234
Selling and marketing expense                                                    866,712                   748,000
General and administrative expense                                               985,760                   915,956
                                                                       -------------------        --------------------
Loss from operations                                                          (1,362,312)               (1,482,722)
Interest (expense)/income                                                        (16,496)                   75,229
Minority interest                                                                 46,274                       ---
Provision for income taxes                                                           ---                       ---
                                                                       -------------------        --------------------
Net loss                                                                  $   (1,332,534)            $  (1,407,493)
                                                                       ===================        ====================
Net loss per common share - basic and diluted                             $         (.23)                     (.27)
                                                                       ===================        ====================


</TABLE>

See accompanying notes.


<PAGE>


                            Frisby Technologies, Inc.
                 Consolidated Statement of Stockholder's Equity
                                   (Unaudited)


<TABLE>
<S>                         <C>          <C>                  <C>                     <C>                <C>



                                                              Additional               Accumu-
                                 Common Stock                  Paid-In                  lated
                            Shares          Amount             Capital                 Deficit            Total

Balance at
December 31, 1999           5,748,113      $ 5,748            $14,888,201          $ (10,615,431)    $4,278,518

Net Loss                          ---          ---                    ---             (1,332,531)   (1,332,531)

Exercise of
Employee Stock
Options                        27,300           27                118,310                    ---        118,337

Balance at                   ________        _____             __________            ____________     _________
March 31, 2000              5,775,413       $5,775            $15,006,511           $(11,947,962)     3,064,324
                            =========       ======            ===========           =============    ==========


</TABLE>


See accompanying notes.




<PAGE>


13




                            Frisby Technologies, Inc.
                      Consolidated Statements of Cash Flows
                                   (Unaudited)
<TABLE>
<S>                                                                           <C>                         <C>


                                                                                    Three month period ended
                                                                                           March 31,
                                                                           -------------------------------------------
                                                                                  2000                    1999
                                                                                  ----                    ----
Operating activities
Net loss                                                                      $   (1,332,534)         $   (1,407,493)

Adjustments to reconcile net loss to net cash used in operating activities:
  Depreciation expense                                                                41,289                  37,471
  Non cash consulting expense                                                             --                  70,000
  Amortization of intangibles                                                         77,688                  51,300
  Changes in assets and liabilities
     Accounts receivable                                                            (691,148)                 37,448
     Inventory                                                                      (702,015)                 38,797
     Other current assets                                                            (21,172)                156,463
     Other non-current assets                                                        222,035                  99,522
     Accounts payable                                                              1,093,031                (238,243)
     Accrued expenses and other current liabilities                                  306,044                (243,759)
     Licenses fees payable                                                          (114,042)                (43,650)
     Deferred license revenues                                                       (26,254)                     --
     Other liabilities                                                                96,807                   3,751
                                                                           -------------------     -------------------
Net cash used in operating activities                                             (1,050,271)             (1,438,393)
                                                                           -------------------     -------------------
Investing activities
Purchases of property and equipment                                                 (386,551)               (265,276)
Purchase of intangible assets                                                             --                (400,000)
Purchase of business, net of cash acquired                                                --                (103,852)
                                                                           -------------------     -------------------
Net cash used in investing activities                                               (386,551)               (769,128)
                                                                           -------------------     -------------------

Financing activities
Proceeds from advances on line of credit                                             942,000                      --
Proceeds from exercise of stock options                                              118,337                      --
Repayment on line of credit                                                         (549,981)                     --
Payment of financing costs                                                           (20,000)                     --
                                                                           -------------------     -------------------
Net cash provided by financing activities                                            490,356                      --
                                                                           -------------------     -------------------
Net (decrease) in cash and cash equivalents                                         (946,466)             (2,207,521)
Cash and cash equivalents - beginning of period                                    1,171,579               6,516,138
                                                                           -------------------     -------------------
Cash and cash equivalents -end of period                                         $   225,113        $      4,308,617
                                                                           ===================     ===================


Supplemental Information:
  Interest Paid                                                                  $    12,227                      --
</TABLE>


See accompanying notes


<PAGE>


                            Frisby Technologies, Inc.
                   Notes to Consolidated Financial Statements
                           March 31, 2000 (Unaudited)

1.  Basis of Presentation

     The  accompanying  unaudited  financial  statements  have been  prepared in
conformity  with  generally  accepted  accounting  principles  and  reflect  all
adjustments  consisting of normal recurring adjustments which, in the opinion of
management, are necessary for a fair presentation of the results for the periods
shown. The results of operations for such periods are not necessarily indicative
of the results  expected for the full fiscal year or for any future period.  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 revenue and expenses during the reporting period. Actual
results could differ from those estimates and assumptions.

     The accompanying  financial  statements  should be read in conjunction with
the  audited  financial  statements  of  Frisby   Technologies,   Inc.  and  its
subsidiaries  (the "Company") for the year ended December 31, 1999 and the notes
thereto contained in the Company's Annual Report on Form 10-KSB,  filed with the
Securities and Exchange Commission on April 14, 2000, as amended.

2.  Summary of Significant Accounting Policies

Net Loss Per Share

     Net loss per share for the  three-month  periods  ended  March 31, 2000 and
1999 are based on the  weighted  average  number of  common  shares  outstanding
during the period in  accordance  with the  Statement  of  Financial  Accounting
Standard ("SFAS") No. 128 "Earnings Per Share."

     Shares  used in the  computation  of net loss per share for the three month
periods ended March 31, 2000 and 1999 were 5,752,663 and 5,120,613 respectively,
representing the weighted-average  common shares outstanding for the period. The
number of shares  used in the  calculation  of net loss per share on a basic and
diluted basis is the same.

3.   Stockholder's Equity

     On April 14, 2000 the  Company  received a firm  commitment  letter from an
investor group for $4 million of a potential aggregate equity transaction in the
Company  of up to $7.5  million.  The  proposed  transaction  includes  both the
Company's common stock and warrants and has been approved by the Company's Board
of Directors. The Company anticipates that the first closing on this transaction
will occur on or before May 31, 2000.

4.   Joint Venture

     During the first quarter 2000,  the Company  signed a definitive  agreement
with Schoeller Textil AG for the establishment of Schoeller Frisby  Technologies
GmbH,  a joint  venture to expand the  European  distribution  of the  Company's
products.  The Company owns 51% of the outstanding shares of the common stock of
the joint venture and,  accordingly,  consolidates the joint venture.  The joint
venture  began   operations  in  January  2000.  The  initial  equity  and  debt
contribution to this joint venture will not exceed $1 million.

The Company recorded minority  interest  expense,  which reflects the portion of
the earnings of  Schoeller  Frisby  Technologies  GmbH which are  applicable  to
Schoeller  Textil AG's minority  interest.  The minority  interest amount on the
Balance  Sheet  represents  the  share of the net  assets  of  Schoeller  Frisby
Technologies  GmbH  associated  with the  minority  partner's  interest in those
operations.


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


Results of  Operations  for the three month period ended March 31, 2000 compared
with the three month period ended March 31, 1999

     Revenues.  The Company  generates  revenue from four primary  sources:  (i)
sales of its  Thermasorb(R)  and  ComforTemp(R)DCC(TM)  products  for use in its
strategic partners'  products;  (ii) sales of SteeleVest and Extreme Comfort end
use products (iii) license fees and royalties from the use of Thermasorb(R)  and
ComforTemp(R)  trademarks by strategic partners in end-user products, as well as
other fees earned in connection with its agreements with strategic partners; and
(iv)  revenue  from  research and  development  contracts  related to the United
States  Government  and from  private  companies.  Total  revenues for the three
months  ended  March  31,  2000  increased  by  $1,436,404  to  $2,463,230  from
$1,026,826 for the three months ended March 31, 1999.

     The majority of this increase was  generated by increased  product sales of
$1,575,560  to  $2,405,980  from  $830,420  for the three months ended March 31,
1999.  This product sales  increase  reflects the inclusion of Schoeller  Frisby
Technologies  GmbH for approximately  $1,000,000,  as well as increased sales to
existing and new customers.

     Cost of sales.  The  Company's  cost of sales  consists  of: (i) direct and
indirect costs incurred in connection with product sales;  (ii) royalty payments
required to be made in  accordance  with the  technology  licensing  agreements;
(iii) the amortization expense associated with the transaction with the inventor
to lower the  royalty  rates and (iv)  direct and  indirect  costs  incurred  in
connection with revenue from research and development  contracts.  Total cost of
sales for the three  months  ended March 31, 2000  increased  by  $1,127,478  to
$1,973,070 from $845,592 for the three months ended March 31, 1999.

The majority of this  increase  was  generated  by  increased  product  sales of
$1,159,828  to  $1,817,028  from  $657,200  for the three months ended March 31,
1999. This increase corresponds to the product sales increase above.

Additionally,  cost of sales related to license fees and royalties for the three
months ended March 31, 2000  increased by $49,585 to $156,042  from $106,457 for
the three months ended March 31, 1999 due to higher  guaranteed  annual  minimum
royalty payments to licensor in 2000.

     Selling and marketing expense. Selling and marketing expenses for the three
months ended March 31, 2000  increased by $118,712 to $866,712 from $748,000 for
the three months ended March 31, 1999. This increase  results from the Company's
increased  marketing  and  advertising  activity  in order to build  brand  name
recognition  of its  ComforTemp(R)  products and  trademarks.  These  activities
included the advertising placements and tradeshow  participation.  Additionally,
selling expense related to Schoeller  Frisby  Technologies  GmbH  contributed to
this increase.

     General and administrative expense. General and administrative expenses for
the three  months  ended March 31, 2000  increased  by $69,204 to $985,160  from
$915,956  for the three months  ended March 31,  1999.  The  increase  primarily
reflects the inclusion of Schoeller Frisby Technologies GmbH.


     Minority interest.  Minority interest represents  Schoeller Textil AG's 49%
interest in the net loss of Schoeller Frisby Technologies GmbH.


     Interest expense/income.  Interest expense for the three months ended March
31, 2000 arises from the  advances  made against the line of credit in the first
quarter of 2000. The interest  income in the prior year reflects the higher cash
and  investment  balances,  due to receipts of proceeds from the Initial  Public
Offering ("IPO") in April 1998.

     Net loss. As a result of the  foregoing,  the net loss for the months ended
March 31, 2000  decreased to  $1,332,534  from  $1,407,493  for the three months
ended March 31, 1999.

Liquidity and Capital Resources

     From its  inception  through  March 31,  2000,  the  Company  has  incurred
cumulative  losses of  approximately  $11,947,962.  The Company has financed its
operations to date through research and development contracts relating to United
States  government  programs,  bank  borrowings and issuance of common stock and
convertible preferred stock.

     At March 31, 2000,  the Company had working  capital of $794,115  including
cash of $225,113, accounts receivable of $2,540,584 and inventory of $1,799,064,
offset by accounts  payable of $2,715,311,  note payable  short-term of $942,000
and accrued expenses and other current liabilities of $546,043.

     Cash used by operating  activities  was  $1,050,000  and $1,438,000 for the
three months ended March 31, 2000 and 1999,  respectively.  The principal factor
contributing to the cash used in operating activities for the three months ended
March  31,  2000 and 1999 was the net loss for each of the  respective  periods.
Cash used by investing  activities was $387,000 and $769,000 for the three ended
March 31, 2000 and 1999, respectively. The principal investing activity for 2000
was the  purchase  of  property  and  equipment  for the new  headquarters.  The
principal  investing  activities  for 1999 were the  purchase of fixed assets of
$265,000 and an installment payment on the purchase of intellectual  property of
$400,000.  Cash  provided by  financing  activities  was  $490,000 for the three
months  ended March 31, 2000.  The  principal  financing  activity for the three
months  ended  March  31,  2000 was the net  advance  on the Line of  Credit  of
$392,000 .

     The  Company  has  incurred  cumulative  losses  since its  inception  and,
therefore,  has not been subject to significant  federal  income taxes.  Through
March 31, 2000,  the Company has generated net operating loss  carryforwards  in
excess of $11,900,000 that may be available to reduce future  available  taxable
income and future tax liabilities.  These carryforwards  expire in years through
2019. The Tax Reform Act of 1986 provides for an annual limitation on the use of
net operating loss  carryforwards  (following  certain  ownership  changes) that
could significantly limit the Company's ability to utilize these  carryforwards.
As a result of the IPO,  the  Company's  ability to utilize  the  aforementioned
carryforwards  as  of  the  IPO  date  will  be  limited  on  an  annual  basis.
Additionally,  because the United  States tax laws limit the time  during  which
these  carryforwards may be applied against future taxes, the Company may not be
able to take full advantage of these attributes for federal tax purposes.

     As of March 31, 2000,  the Company has a  $2,000,000  Line of Credit with a
bank.  This line is maintained  for working  capital  purposes at least until an
equity or debt investment is secured. The Line is a committed facility, which is
secured by substantially all of the Company's assets,  and bears interest at the
bank's prime rate plus 200 basis points.  At March 31, 2000,  the balance on the
Line of Credit was $942,000.

     On April 14, 2000, the Company  received a firm  commitment  letter from an
investor group for $4 million of a potential aggregate equity transaction in the
Company  of up to $7.5  million.  The  proposed  transaction  includes  both the
Company's common stock and warrants and has been approved by the Company's Board
of Directors.  The Company  anticipates  that this  transaction will close on or
before May 31, 2000.

     The Company has signed a definitive  agreement with Schoeller Textil AG for
the  establishment  of Schoeller  Frisby  Technologies  GmbH, a joint venture to
expand the European  distribution of the Company's products.  The initial equity
and debt  contribution  to this joint  venture  will not exceed $1 million.  The
joint venture began operations in January 2000.

     Based on the Company's  current  operating plan, the Company  believes that
the cash  available  as a  result  of the  committed  portion  of the  financing
activity  mentioned  above will be  sufficient  to satisfy its  operational  and
capital  requirements  through  December 2000. Such belief is based upon certain
assumptions, and there can be no assurance that such assumptions are correct. In
the event that the Company's plans change, or its available cash, cash flow from
operations and available line of credit are  insufficient to fund operations due
to unanticipated delays,  problems,  expenses or otherwise, the Company would be
required  to  seek  additional  financing  sooner  than  anticipated.   Further,
depending on the  Company's  progress in  marketing  its product  line,  gaining
acceptance  of its thermal  management  technology  and its other  products  and
services  among  the  business  community  or the  identification  of  strategic
acquisition  or licensing  opportunities,  the Company may determine  that it is
advisable to raise additional capital sooner than was anticipated.

Inflation

     The  impact  of  general  inflation  on the  Company's  business  has  been
insignificant  to date and the  Company  believes  that it will  continue  to be
insignificant for the foreseeable future.

Foreign Currency

     The functional  currency of the Schoeller Frisby  Technologies  GmbH is the
Swiss Franc.


Year 2000

     During 1999, Frisby  successfully  completed its  comprehensive  program to
address the Year 2000 issue.  As expected,  the Company did not  experience  any
material adverse effects on its business, products, and results of operations or
financial  condition as a result of the Year 2000 issue. Frisby will continue to
monitor  its own  operations,  and the  operations  of  third  parties  that are
critical to Frisby's  operations,  for  potential  Year  2000-related  problems.
However,  the Company does not anticipate  that it will discover any future Year
2000 issues that will have a material effect on its business  products,  results
of operations or financial condition.

Forward-Looking Statements

Certain  information   contained  in  this  Quarterly  Report  on  Form  10-QSB,
including,  without  limitation,  information  appearing  under  Part I, Item 2,
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations," are  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).  Factors set forth in the Company's Prospectus filed April 1, 1998, or in
the Company's other Securities and Exchange Commission filings, could affect the
Company's  actual results and could cause the Company's actual results to differ
materially from those expressed in any forward-looking statements made by, or on
behalf of, the Company in this Quarterly Report on Form 10-QSB.

     Those statements are subject to numerous risks and uncertainties that could
cause actual  results,  performance and  achievements to differ  materially from
those  described  or implied in the  forward-looking  statements,  and  reported
results  should not be considered an  indication  of future  performance.  Those
potential risks and uncertainties  include without limitation the uncertainty of
the economic  environment  for the remainder of this year,  the need for further
development  of  certain  Frisby   Technologies'   products  and  markets,   the
development  of  alternative  technologies  by third  parties,  Year 2000 issues
affecting the Company and its customers and  suppliers,  and the  uncertainty of
market acceptance and demand for the Company's products in the future.


<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

See the Form 8-K, dated April 25, 2000, regarding the establishment of Schoeller
Frisby Technologies GmbH.

Item 6.  Exhibits and Reports on Form 8-K

         (a)      Exhibits

                  27.1     Financial Data Schedule

         (b)      Reports on Form 8-K

                  The  Company  filed a report  on Form 8-K on  April  25,  2000
                  regarding the  establishment of Schoeller Frisby  Technologies
                  GmbH.




<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.

         Dated:  May 15, 2000

                                       FRISBY TECHNOLOGIES, INC.



                                      By:/s/ Gregory S. Frisby
                                         ------------------------
                                         Gregory S. Frisby
                                         President and Chief Executive Officer



                                       By:/s/ Stephen P. Villa
                                         -----------------------
                                         Stephen P. Villa
                                         Chief Financial Officer