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

                                   FORM 10-QSB

(Mark One)

    X     Quarterly report under Section 13 or 15(d) of the Securities
---------   Exchange Act of 1934


            For the quarterly period ended   September 30, 2003
                                             ------------------

_______ Transition report under Section 13 or 15(d) of the Exchange Act

            For the transition period from __________  to  ___________

Commission File Number    1-10526
                        -----------

                            UNITED-GUARDIAN, INC.
-------------------------------------------------------------------------
     (Exact Name of Small Business Issuer as Specified in Its Charter)

          Delaware                                11-1719724
-------------------------------      ------------------------------------
(State or Other Jurisdiction of      (I.R.S. Employer Identification No.)
  Incorporation or Organization)

              230 Marcus Boulevard., Hauppauge, New York 11788
-------------------------------------------------------------------------
                  (Address of Principal Executive Offices)

                              (631) 273-0900
-------------------------------------------------------------------------
                (Issuer's Telephone Number, Including Area Code)

-------------------------------------------------------------------------
       (Former Name, Former Address and Former Fiscal Year, if Changed
          Since Last Report)

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

Yes      X                No
    ----------               -----------









                             Cover Page 1 of 2 Pages
<PAGE>
         APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
                        DURING THE PRECEDING FIVE YEARS

         Check whether the Company filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Exchange Act after
the distribution of securities under a plan confirmed by a court.

Yes _________             No ____________

                      APPLICABLE ONLY TO CORPORATE ISSUERS

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

                                    4,912,239
                                  -------------









































                             Cover Page 2 of 2 Pages
<PAGE>
                              UNITED-GUARDIAN, INC.

                                      INDEX


                                                                       Page No.
                                                                      ----------
Part I.  FINANCIAL INFORMATION

   Item 1 - Financial Statements

              Consolidated Statements of Income - Three and
                Nine Months Ended September 30, 2003 and 2002...........   2

              Consolidated Balance Sheets -
                September 30, 2003 and December 31, 2002................ 3-4

              Consolidated Statements of Cash Flows -
                Nine Months Ended September 30, 2003 and 2002............. 5

              Consolidated Notes to Financial Statements............... 6-11

   Item 2 - Management's Discussion and Analysis of
             Financial Condition and Results of Operations............ 11-14

   Item 3 - Controls and Procedures................................... 14-15

Part II. OTHER INFORMATION

   Item 1 - Legal Proceedings............................................ 15

   Item 2 - Changes in Securities and Use of Proceeds.................... 15

   Item 3 - Defaults Upon Senior Securities.............................. 15

   Item 4 - Submission of Matters to a Vote of Security Holders.......... 15

   Item 5 - Other Information............................................ 15

   Item 6 - Exhibits and Reports On Form 8-K.......................... 15-16

Signatures................................................................16
















                                        1
<PAGE>
                          Part I. FINANCIAL INFORMATION

ITEM 1. Financial Statements

                             UNITED-GUARDIAN, INC.
                       CONSOLIDATED STATEMENTS OF EARNINGS
                                   (UNAUDITED)

                             NINE MONTHS ENDED           THREE MONTHS ENDED
                                SEPTEMBER 30,                SEPTEMBER 30,
                             2003          2002           2003          2002
                            ------        ------         ------        ------
Revenue:
  Net sales              $ 8,632,494   $ 6,796,553    $ 2,315,417   $ 2,085,937
                          ----------    ----------     ----------    ----------
Costs and expenses:
  Cost of sales            4,018,227     3,726,051        964,711     1,174,265
  Operating expenses       1,829,687     1,698,670        566,879       562,921
                          ----------    ----------     ----------    ----------
                           5,847,914     5,424,721      1,531,590     1,737,186
      Income from         ----------    ----------     ----------    ----------
         operations        2,784,580     1,371,832        783,827       348,751


Other income (expense):
  Investment income          118,291       144,075         39,127        44,987
  Gain on sale of assets         500            79           -             -
  Other                          (25)          (49)          -             -
        Income before      ----------    ----------     ----------    ---------
           income taxes    2,903,346     1,515,937        822,954       393,738

Provision for income taxes 1,032,000       528,548        290,000       135,548
                           ---------     ---------      ---------     ---------
      Net income         $ 1,871,346   $   987,389    $   532,954   $   258,190
                           =========     =========      =========     =========
Earnings per common share
   (basic and diluted)   $      0.38   $      0.20    $      0.11   $      0.05
                           =========     =========      =========     =========
Weighted average shares
  - basic                  4,892,737     4,877,478      4,910,022     4,881,139
                           =========     =========      =========     =========
Weighted average shares
  - diluted                4,910,370     4,889,870      4,930,761     4,888,794
                           =========     =========      =========     =========














                        See notes to financial statements

                                        2
<PAGE>
                              UNITED-GUARDIAN, INC.
                           CONSOLIDATED BALANCE SHEETS

                                            SEPTEMBER 30,      DECEMBER 31,
                                                2003               2002
                                            ------------       -------------
              ASSETS                         (UNAUDITED)  (DERIVED FROM AUDITED
                                                           FINANCIAL STATEMENTS)
Current assets:
     Cash and cash equivalents           $   1,666,853      $    3,184,599
     Temporary investments                   2,280,036           4,151,787
     Marketable securities                   6,005,562             882,243
     Accounts receivable, net of
       allowance for doubtful accounts
       of $25,500 at September 30, 2003 and
       and December 31, 2002 respectively    1,037,985             704,560
     Inventories (net)                         845,948           1,037,315
     Prepaid expenses and other
        current assets                         173,900             342,476
     Deferred income taxes                     279,947             297,774
                                           -----------         -----------
              Total current assets          12,290,231          10,600,754
                                           -----------         -----------

Property, plant and equipment:
     Land                                       69,000              69,000
     Factory equipment and fixtures          2,797,500           2,738,110
     Building and improvements               2,068,266           2,045,588
     Waste disposal plant                      133,532             133,532
                                           -----------         -----------
                                             5,068,298           4,986,230
       Less: Accumulated depreciation        4,021,716           3,880,660
                                           -----------         -----------
                                             1,046,582           1,105,570
                                           -----------         -----------
Other assets:
     Processes and patents, net of
        accumulated amortization of
        $981,635 and $981,341 at
        September 30, 2003 and December 31,
        2002, respectively                         163                 456
     Other                                         700                 700
                                           -----------         -----------
                                                   863               1,156
                                           -----------         -----------
                                        $   13,337,676      $   11,707,480
                                           ===========         ===========











                        See notes to financial statements

                                        3
<PAGE>
                              UNITED-GUARDIAN, INC.
                           CONSOLIDATED BALANCE SHEETS



                                           SEPETMBER 30,        DECEMBER 31,
                                               2003                2002
                                          ---------------      ------------
LIABILITIES AND                             (UNAUDITED)   (DERIVED FROM AUDITED
STOCKHOLDERS' EQUITY                                       FINANCIAL STATEMENTS)

Current liabilities:
   Dividends payable                       $     -             $  488,114
   Accounts payable                           220,407             188,868
   Accrued expenses                           315,547             345,407
   Taxes payable                              101,483                -
                                            ---------           ---------
         Total current liabilities            637,437           1,022,389
                                            ---------           ---------
 Deferred income taxes                         10,000              10,000
                                            ---------           ---------

Stockholders' equity:
   Common stock $.10 par value,
      authorized, 10,000,000 shares;
      4,974,239 and 4,943,339 shares
      issued, respectively; 4,912,039
      and 4,881,139 shares outstanding,
      respectively                            497,424             494,334
   Capital in excess of par value           3,649,168           3,538,423
   Accumulated other comprehensive loss       (25,809)            (55,776)
   Retained earnings                        8,929,086           7,057,740
   Treasury stock, at cost; 62,200 shares    (359,630)           (359,630)
                                            ---------           ---------
         Total stockholders' equity        12,690,239          10,675,091
                                            ---------           ---------
                                         $ 13,337,676        $ 11,707,480
                                           ==========          ==========




















                        See notes to financial statements

                                        4
<PAGE>
                              UNITED-GUARDIAN, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
                                                           NINE MONTHS ENDED
                                                              SEPTEMBER 30,
                                                              ------------
                                                         2003            2002
                                                       -------         -------
Cash flows provided by operating activities:
  Net income                                       $ 1,871,346     $   987,389
  Adjustments to reconcile net earnings
    to net cash flows from operations:
      Depreciation and amortization                    149,349         192,320
      Amortization of bond premium                       5,548           9,144
      Net gain on sale of equipment                       (500)            (79)
      Provision for doubtful accounts                   11,406            -
      Provision for inventory obsolescence             125,800            -
      (Increase) decrease in assets:
         Accounts receivable                          (344,831)         64,618
         Inventories                                    65,567         (19,350)
         Prepaid expenses and other current
           and non-current assets                      168,576          11,085
      Increase (decrease) in liabilities:
         Accounts payable                               31,539         126,935
         Accrued expenses and taxes payable             71,623          27,841
                                                    ----------        --------
      Net cash provided by operating activities      2,155,423       1,399,903
                                                    ----------        --------
Cash flows from investing activities:
   Acquisition of property, plant and equipment        (90,068)       (102,341)
   Proceeds from sale of equipment                         500          14,500
   Net change in temporary investments               1,871,751         332,014
   Proceeds from sale of marketable securities         480,000            -
   Purchase of marketable securities                (5,561,073)         (2,924)
                                                    ----------        --------
      Net cash provided by (used in)
       investing activities                         (3,298,890)        241,249
                                                    ----------        --------
Cash flows from financing activities:
   Proceeds from exercise of stock options             113,835          35,975
   Dividends paid                                     (488,114)       (487,044)
                                                    ----------        --------
     Net cash used in financing activities            (374,279)       (451,069)
                                                    ----------        --------

Net (decrease) increase in cash and
   cash equivalents                                 (1,517,746)      1,190,083

Cash and cash equivalents at beginning of period     3,184,599       1,599,857
                                                    ----------       ---------
Cash and cash equivalents at end of period         $ 1,666,853     $ 2,789,940
                                                    ==========       =========






                        See notes to financial statements

                                        5
<PAGE>
                              UNITED-GUARDIAN, INC.
                   CONSOLIDATED NOTES TO FINANCIAL STATEMENTS

      1. In the opinion of the Company,  the  accompanying  unaudited  financial
statements  contain  all  adjustments   (consisting  of  only  normal  recurring
accruals) necessary to present fairly the financial position as of September 30,
2003 and the results of operations  and cash flows for the three and nine months
ended  September  30, 2003 and 2002.  The  accounting  policies  followed by the
Company  are set forth in the  Company's  financial  statements  included in its
December 31, 2002 Annual Report to Shareholders.

      2. The results of operations for the three and nine months ended September
30, 2003 and 2002 are not  necessarily  indicative of the results to be expected
for the full year.

      3.  Stock-Based  Compensation:  At September 30, 2003, the Company had two
stock-based  employee  compensation  plans.  As  permitted  under SFAS NO.  148,
(Accounting  for  Stock-Based  Compensation-Transition  and  Disclosure),  which
amended SFAS NO. 123, (Accounting for Stock-Based Compensation), United-Guardian
has elected to continue to follow the intrinsic  value method in accounting  for
its  stock-based  employee  compensation  arrangement  as defined by  Accounting
Principle  Board  Opinion  ("APB")  No.  25,  (Accounting  for  Stock  Issued to
Employees), and related interpretations including Financial Accounting Standards
Board  Interpretation  No. 44,  (Accounting for Certain  Transactions  involving
Stock  Compensation),  an  interpretation  of APB No.  25. The  following  table
illustrates  the effect on net income and  earnings per share if the company had
applied the fair value  recognition  provisions  of SFAS  No.123 to  stock-based
employee compensation.
<table>
<caption>
                                                    Nine months ended              Three months ended
                                                        September 30,                 September 30,
                                                    2003            2002           2003            2002
                                                  --------        --------       --------        --------
<S>                                             <C>             <C>              <C>             <C>
Reported net income                             $1,871,346      $  987,389       $532,954        $258,190

 Stock-based employee compensation
   expense included in reported net
   income, net of related tax effects                    0               0              0               0

 Stock-based employee compensation
   determined under the fair value based
   method, net of related tax effect               (15,957)              0         (2,762)              0
                                                 ---------        --------       --------        --------
     Pro forma net income                       $1,855,389        $987,389       $530,192        $258,190
                                                ==========        ========       ========        ========
 Earnings per share (basic and diluted)
   As reported                                  $      .38        $    .20       $    .11        $    .05
   Pro forma                                    $      .38        $    .20       $    .11        $    .05

</table>







                                        6
<page>
     4. Inventories - Net

     Inventories consist of the following:     September 30,    December 31,
                                                    2003            2002
                                                ----------      ----------
     Raw materials and work in process          $  302,495      $  269,067
     Finished products and fine chemicals          543,453         768,248
                                                ----------      ----------
                                                $  845,948      $1,037,315
                                                ==========      ==========

      At September  30, 2003 and  December  31,  2002,  the Company has reserved
$240,200 and $366,000 respectively for slow moving and obsolete inventory.

      5. For purposes of the Statement of Cash Flows, the Company  considers all
highly liquid  investments  purchased with a maturity of three months or less to
be cash equivalents.

      Cash  payments  for taxes were  $801,295  and $513,779 for the nine months
ended September 30, 2003 and 2002, respectively.

     6. Comprehensive Income (Loss)

            The components of comprehensive income (loss) are as follows:

<table>
<caption>
                                          Nine months ended September 30,    Three months ended September 30,
                                                2003           2002               2003           2002
                                               ------         ------             ------         ------
<S>                                        <C>             <C>                 <C>             <C>
Net income                                 $1,871,346      $  987,389          $532,954        $258,190
                                            ---------         -------           -------         -------
Other comprehensive income (loss)
   Unrealized gain (loss) on
   marketable securities                       47,795         (67,874)           25,552         (35,022)
                                              -------         -------           -------         -------
Income tax benefit on
   comprehensive gain (loss)                   17,827         (27,621)            9,547         (13,064)
                                              -------         -------           -------         -------
Other comprehensive income (loss)              29,968         (40,253)           16,021         (21,958)
                                              -------         -------           -------         -------
Comprehensive income                       $1,901,314      $  947,136          $548,975        $236,232
                                            =========         =======           =======         =======
</table>
     Accumulated  other  comprehensive  income (loss) is comprised of unrealized
gains and losses on marketable securities, net of the related tax effect.












                                        7
<page>
         7. Earnings Per Share

         The  following  table sets forth the  computation  of basic and diluted
earnings per share at September 30, 2003 and 2002.
<table>
<caption>
                                                    Nine months ended            Three months ended
                                                       September 30,                September 30,
                                                     2003           2002          2003           2002
                                                    ------         ------        ------         ------
<S>                                              <C>            <C>           <C>            <C>
Numerator:
   Net income                                    $1,871,346     $  987,389    $  532,954     $  258,190
                                                  =========        =======       =======        =======
Denominator:
   Denominator for basic earnings
   per share (weighted average
   shares)                                        4,892,737      4,877,478     4,910,022      4,881,139

Effect of dilutive securities:
   Employee stock options                            17,633         12,392        20,739          7,655
                                                  ---------      ---------     ---------      ---------
Denominator for diluted earnings
   per share (adjusted weighted-average
   shares) and assumed conversions                4,910,370      4,889,870     4,930,761      4,888,794
                                                  =========      =========     =========      =========
Basic and diluted earnings per share             $     0.38     $     0.20    $     0.11     $     0.05
                                                  =========      =========     =========      =========
</table>
      Options to purchase  8,500 and 2,833 shares of the Company's  common stock
have been excluded  from the  computation  of diluted  earnings per share in the
three  and  nine  months  ended  September  30,  2002,  respectively,  as  their
inclusion would be antidilutive.

      8.  The  Company  has the  following  two  reportable  business  segments:
Guardian  Laboratories  and Eastern  Chemical.  The  Guardian  segment  conducts
research,  development and  manufacturing of  pharmaceuticals,  medical devices,
cosmetics,  products and proprietary  specialty chemical  products.  The Eastern
segment distributes fine chemicals, solutions, dyes and reagents.

     The accounting policies used to develop segment  information  correspond to
those described in the summary of significant  accounting  policies as set forth
in the Annual Report for the year ended December 31, 2002.  Segment  earnings or
loss is based on earnings  or loss from  operations  before  income  taxes.  The
reportable   segments  are  distinct   business  units  operating  in  different
industries.   They  are  separately   managed,   with  separate   marketing  and
distribution  systems.  The following  information about the two segments is for
the nine and three month periods ended September 30, 2003 and 2002.












                                        8
<page>
<TABLE>
<CAPTION>
                                                               Nine months ended September 30,
                                                     2003                                            2002
                                     ------------------------------------            ------------------------------------
                                     GUARDIAN       EASTERN         TOTAL            GUARDIAN       EASTERN         TOTAL
                                   ------------   ------------   -----------       ------------   ------------   -----------
<S>                                <C>            <C>            <C>               <C>            <C>            <C>
Revenues from external customers   $ 7,824,875    $   807,619    $ 8,632,494       $ 5,859,785    $   936,768    $ 6,796,553
Depreciation and amortization           64,852           -            64,852           105,186           -           105,186
Segment income (loss) before
  income taxes                       2,894,764         14,191      2,908,955         1,550,911        (51,638)     1,499,273

Segment assets                       2,076,219        303,359      2,379,578         2,125,281         665,859      2,791,140

Expenditures for segment assets         62,808            -           62,808            34,819            -           34,819

Reconciliation to Consolidated Amounts

Income before income taxes
----------------------------
Total earnings for reportable segments                           $ 2,908,955                                     $ 1,499,273
Other income, net                                                    118,766                                         144,105
Corporate headquarters expense                                      (124,375)                                       (127,441)
                                                                  ----------                                      ----------
Consolidated earnings before income
   taxes                                                         $ 2,903,346                                     $ 1,515,937
                                                                  ==========                                      ==========
Assets
------
Total assets for reportable segments                             $ 2,379,578                                     $ 2,791,140
Corporate headquarters                                            10,958,098                                       8,641,256
                                                                  ----------                                      ----------
      Total consolidated assets                                  $13,337,676                                     $11,432,396
                                                                  ==========                                      ==========
</TABLE>
<TABLE>
<CAPTION>
                                                                  Three months ended September 30,
                                                     2003                                            2002
                                     ------------------------------------            ------------------------------------
                                     GUARDIAN       EASTERN         TOTAL            GUARDIAN       EASTERN         TOTAL
                                   ------------   ------------   -----------       ------------   ------------   -----------
<S>                                <C>            <C>            <C>               <C>            <C>            <C>
Revenues from external customers   $ 2,086,738    $   228,679    $ 2,315,417       $ 1,773,778    $   312,159    $ 2,085,937
Depreciation and amortization           19,045           -            19,045            34,015           -            34,015
Segment income (loss) before
   income taxes                        767,923         54,179        822,102           420,141        (24,475)       395,666
</table>









                                        9
<page>
<table>
Earnings before income taxes
----------------------------
Total income for reportable segments                             $   822,102                                     $   395,666
Other income, net                                                     39,127                                          44,987
Corporate headquarters expense                                       (38,275)                                        (46,915)
                                                                  ----------                                       ---------
Consolidated earnings before income
   taxes                                                         $   822,954                                    $   393,738
                                                                  ==========                                       =========
Other significant items
-----------------------
<CAPTION>
                                                                 Nine Months ended September 30,
                                                     2003                                           2002
                                   ------------------------------------------       -------------------------------------------
                                     Segment                     Consolidated          Segment                     Consolidated
                                      Totals       Corporate        Totals              Totals        Corporate       Totals
                                   ------------   ------------   -------------      -------------   ------------   -------------
<S>                                 <C>           <C>            <C>                 <C>           <C>            <C>
Expenditures for assets                62,808         27,260          90,068            34,819         67,522          102,341
Depreciation and amortization          64,852         84,497         149,349           105,186         87,134          192,320

Geographic Information
----------------------
<CAPTION>
                                                       2003                                2002
                                           ---------------------------         ---------------------------
                                             Revenues      Long-Lived            Revenues      Long-Lived
                                                             Assets                              Assets
                                           -----------    -------------        -----------    -------------
<S>                                        <C>           <C>                   <C>           <C>
United States                              $ 4,384,781   $    1,046,745        $ 4,075,260   $    1,129,163
France                                       1,069,869                             893,559
Other countries                              3,177,844                           1,827,734
                                           -----------    -------------        -----------    -------------
                                           $ 8,632,494   $    1,046,745        $ 6,796,553   $    1,129,163
                                           ===========    =============        ===========    =============

Major Customers
---------------
Customer A (Guardian)*                     $ 3,523,475                         $ 2,013,715
Customer B (Guardian)                          876,078                             696 215
All other customers                          4,232,941                           4,086,623
                                           -----------                         -----------
                                           $ 8,632,494                         $ 6,796,553
                                           ===========                         ===========

* At September 30, 2003 Customer A had a balance approximating 28% of accounts
  receivable.
</table>








                                       10
<page>
     9. Impact of Recently Issued  Accounting  Pronouncements

        In June  2002,  the FASB  issued  SFAS No.  146,  "Accounting  for Costs
Associated with Exit or Disposal  Activities,"  which  addresses  accounting for
restructuring  and similar costs.  SFAS No. 146 supersedes  previous  accounting
guidance,  principally  Emerging  Issues Task Force Issue No. 94-3. SFAS No. 146
requires  that the  liability  for  costs  associated  with an exit or  disposal
activity  be  recognized  when the  liability  is  incurred.  SFAS No.  146 also
establishes that the liability should initially be measured and recorded at fair
value.  Accordingly  SFAS No. 146 may affect  the timing of  recognizing  future
restructuring costs as well as the amount recognized.  SFAS No. 146 is effective
for exit or disposal  activities  that are  initiated  after  December 31, 2002.
Management  believes  that the adoption of SFAS No. 146 will not have a material
impact on its results of operations or financial position.

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

FORWARD LOOKING STATEMENTS

        Statements made in this Form 10-QSB which are not purely  historical are
forward-looking  statements  with  respect  to  the  goals,  plans,  objectives,
intentions,  expectations,  financial condition,  results of operations,  future
performance  and  business of the  Company.  Forward-looking  statements  may be
identified  by the use of such words as  "believes,"  "may,"  "will,"  "should,"
"intends," "plans," "estimates," or "anticipates" or other similar expressions.

        Forward-looking statements involve inherent risks and uncertainties, and
important  factors  (many of which are beyond our  control)  could cause  actual
results  to  differ  materially  from  those  set  forth in the  forward-looking
statements.  In addition to those specific risks and  uncertainties set forth in
the  Company's  reports  currently on file with the SEC, some other factors that
may affect the future results of operations of the Company are: the  development
of products  that may be superior  to the those of the  Company;  changes in the
quality or composition of the Company's  products;  lack of market acceptance of
the Company's products;  the Company's ability to develop new products;  general
economic  or  industry  conditions;  intellectual  property  rights;  changes in
interest rates;  new legislation or regulatory  requirements;  conditions of the
securities  markets;  the  Company's  ability  to  raise  capital;   changes  in
accounting   principals,   policies  or   guidelines;   financial  or  political
instability;  acts  of  war  or  terrorism;  and  other  economic,  competitive,
governmental,  regulatory  and  technical  factors that may affect the Company's
operations, products, services and prices.

        Accordingly,  results actually achieved may differ materially from those
anticipated as a result of such forward-looking statements, and those statements
speak only as of the date they are made.  The Company  does not  undertake,  and
specifically disclaims, any obligation to update any forward-looking  statements
to reflect events or circumstances occurring after the date of such statements.

OVERVIEW

     The  Company  is a  Delaware  corporation  that  operates  in two  business
segments.  Its Guardian  Laboratories  Division  ("Guardian") conducts research,
product  development,  manufacturing  and  marketing  of  cosmetic  ingredients,
personal and health care  products,  pharmaceuticals,  and specialty  industrial


                                       11
<page>
products.  The products  manufactured by Guardian are marketed through marketing
partners, distributors, direct advertising, mailings, and trade exhibitions. Its
most important personal care product line is its LUBRAJEL(R) line of water based
moisturizing and lubricating  gels. It also sells two  pharmaceutical  products,
which are  distributed  primarily  through drug  wholesalers and surgical supply
houses. There are also indirect sales to the Veteran's  Administration and other
government agencies, and to some hospitals and physicians.

     While the Company does have  competition in the marketplace for some of its
products,  many of its products or processes are either unique in their field or
have some unique  characteristics,  and therefore are not in direct  competition
with the products or processes of other pharmaceutical, chemical, or health care
companies. Guardian's research and development department is actively working on
the development of new products to expand the Company's personal care line.

     The  Company  has been issued  many  patents  and  trademarks,  and intends
whenever  possible  to make  efforts to obtain  patents in  connection  with its
product development program.

     The Company's Eastern Chemical subsidiary  distributes an extensive line of
fine organic chemicals, research chemicals, test solutions, indicators, dyes and
reagents.   Eastern's  products  are  marketed  through   advertising  in  trade
publications  and  direct  mailings  and are  sold to both to  distributors  and
directly to users for use in a wide variety of applications. Since the Company's
business  activities  and  marketing  efforts over the past  several  years have
focused  increasingly on the Guardian  division,  which the Company believes has
greater growth  potential,  the Company is in the process of reducing  Eastern's
inventory  levels in order to make the subsidiary  more  marketable in the event
the Company decides to sell the Eastern operation at some future date.

     Products  manufactured  by the Company are marketed  worldwide  through its
extensive  marketing and distribution  arrangements.  Approximately  half of the
Company's sales are to foreign customers.

      The  following  discussion  and analysis  covers  material  changes in the
financial  condition of the Company  since year end  December  31,  2002,  and a
comparison  of the  results of  operations for the three and nine month  periods
ended  September 30, 2003 and September 30, 2002.  This  discussion and analysis
should be read in conjunction with "Management's Discussion and Analysis or Plan
of Operation"  included in the Company's Form 10-KSB for the year ended December
31, 2002.

RESULTS OF OPERATIONS

      Gross revenue from operations
      -----------------------------

      For the nine month period  ended  September  30, 2003 net sales  increased
$1,835,941   (27.0%)  versus  the  comparable   period  in  2002.  The  Guardian
Laboratories  division  ("Guardian") had a sales increase of $1,965,090  (33.5%)
while the  Eastern  Chemical  subsidiary  ("Eastern")  had a sales  decrease  of
$129,149 (13.8%).







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<page>
      For the three month period  ended  September  30, 2003  revenue  increased
$229,480  (11.0%) over the comparable  period in 2002.  Guardian sales increased
$312,960 (17.6%), while Eastern sales decreased $83,480 (26.7%).

      The increase in  Guardian's  sales for the three and nine month periods is
due to an overall  increase  in demand  for  Guardian's  products.  Some of this
demand may be  attributable  to new  launches of  personal  care  products  that
contain ingredients produced by Guardian,  by companies that had been refraining
from  launching  new  products  due to the poor  economic  conditions  that have
prevailed in both the U.S. and overseas.  Based on  information  provided to the
Company by its distributors, over the past year or so there has been an increase
in  activity on the part of many  customers,  which has  resulted  in  increased
demand for the Company's products.

     The  decline  in  Eastern's  sales is  believed  to be due mainly to normal
fluctuations  in the  purchasing  patterns  of its  customers,  but may  also be
partially  attributable  to some loss of business due to an inability to provide
some  products as a result of the ongoing  program to reduce  Eastern's  on-hand
inventory.  The Company does not anticipate any significant increase or decrease
in Eastern's sales in the near future.

     Cost of sales
     -------------

     Cost of sales as a  percentage  of sales  decreased  to 46.5%  for the nine
months  ended  September  30, 2003 from 54.8% for the  comparable  period  ended
September 30, 2002. For the three month period ended September 30, 2003 compared
to the  three  month  period  ended  September  30,  2002 the cost of sales as a
percentage of sales  decreased to 41.7% from 56.3%.  This decrease is mainly due
to increased sales resulting in a favorable production variance of approximately
$125,000  for the three and nine month  periods in 2003 as  compared to the same
periods in the prior year.  For the three months ended  September 30, 2003,  the
Company   realized   savings  in  disposal  costs  and  obsolete   inventory  of
approximately $50,000 and $126,000  respectively.  The Company had recorded such
reserves in prior years.

     Excluding realized savings from disposal costs and obsolete inventory, cost
of sales,  as a  percentage  of sales,  would have been 50.0% for the nine month
period ended  September 30, 2003 as compared to 54.8% for the comparable  period
in the prior year. For the three months ended  September 30, 2003, cost of sales
as a  percentage  of sales  would have been 54.7% as  compared  to 56.3% for the
comparable period in the prior year.

     Operating Expenses
     ------------------

      Operating  expenses  increased  $131,017  (7.7%) for the nine months ended
September  30, 2003  compared to the  comparable  period in 2002.  For the three
month period ended September 30, 2003 operating  expenses increased $3,958 (.7%)
over the  comparable  period in 2002. The increase for the nine month period was
primarily due to increases in insurance costs, advertising costs, and a one time
reserve for the payment of a civil fine (see "Legal Proceedings" below). For the
three month period increases in expenses due to the aforementioned civil penalty
and an increase in board of directors  fees were offset by a decrease in payroll
and payroll related costs as compared to the same period in the prior year.



                                       13
<page>
     Investment income
     ---------------

     Investment  income  decreased  $25,784  (17.9%) for the nine months  ended
September  30,  2003 as compared to the  comparable  period in 2002,  and $5,860
(13.0%) for the three  months  ended  September  30,  2003 when  compared to the
comparable  period in 2002.  These  decreases were  attributable to a decline in
interest rates. Investment income is recorded net of brokerage fees.

     Provision for income taxes
     --------------------------

      The provision  for income taxes  increased  $503,452  (95.3%) for the nine
months ended September 30, 2003 when compared to the comparable  period in 2002,
and  $154,452  (113.9%)  for the three  months  ended  September  30,  2003 when
compared to the comparable  period in 2002. These increases are due to increased
earnings before taxes of $1,387,409 for the nine months ended September 30, 2003
and $429,216 for the three months ended September 30, 2002.

LIQUIDITY AND CAPITAL RESOURCES

      Working  capital  increased  from  $9,578,365  at  December  31,  2002  to
$11,652,794 at September 30, 2003. The current ratio increased from 10.4 to 1 at
December  31,  2002 to 19.3 to 1 at  September  30,  2003.  The  Company  has no
commitments  for  any  further  significant  capital   expenditures  during  the
remainder of 2003, and believes that its working capital is and will continue to
be sufficient to support its operating requirements.

      The company  generated  cash from  operations of $2,155,423 and $1,399,903
for  the  nine  months  ended   September   30,  2003  and  September  30,  2002
respectively. The increase was primarily due to the increase in net income.

      During the nine month period ended  September 30, 2003 $3,298,890 was used
in  investment  activities,  as compared to the nine months ended  September 30,
2002 when  $241,249  was  provided  by  investing  activities.  The change  from
$241,249  provided  by  investing  activities  in  2002  to  $3,298,890  used in
investing  activities  in 2003 was due to an increase in purchases of marketable
securities (primarily bonds) and redemption of some certificates of deposit.

      Cash used in financing  activities  was $374,279 and $451,069 for the nine
months  ended  September  30,  2003 and  September  30, 2002  respectively.  The
decrease is due primarily to an increase in stock options  exercised  during the
nine months  ended  September  30,  2003 as  compared  to the nine months  ended
September 30, 2002.

Item 3.  Controls and Procedures

  (a) Evaluation of Disclosure Controls and Procedures

     Within 90 days prior to the filing of this Quarterly  Report on Form 10-QSB
the  Company's  principal  executive  officer and  principal  financial  officer
evaluated the effectiveness of the design and operation of Company's  disclosure







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<page>
controls and procedures (as defined in Rules  13a-14(c) and 15d-14(c)  under the
Securities  Exchange Act of 1934 (the  "Exchange  Act")) and concluded  that the
Company's  disclosure  controls  and  procedures  are  effective  to ensure that
information  required to be disclosed by the Company in reports that it files or
submits under the Exchange Act is accumulated  and communicated to the Company's
management,  including its officers,  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 Securities and Exchange Commission's rules and forms.

   (b Changes in Internal Controls

     The Company's  principal  executive officer and principal financial officer
have also concluded there were no significant  changes in the Company's internal
controls or in other  factors that could  significantly  affect  these  controls
subsequent to the date of their  evaluation,  including any  corrective  actions
with regard to significant deficiencies and material weaknesses.

                       PART II - OTHER INFORMATION

ITEM 1 - LEGAL PROCEEDINGS

     While the  Company  has  claims  arise  from time to time in the  ordinary
course of its business,  the settlement of such claims in the past has not had a
material  adverse  effect on the  Company's  financial  position  and results of
operations.

      In  September,  2003 the Company was served with a complaint  and proposed
order by the U.S. Environmental  Protection Agency ("EPA") alleging that (a) the
Company had failed to perform certain testing of its pharmaceutical  waste water
prior to having it disposed of by the licensed  contractor it had been using for
many years, and (b) that it had failed to provide the proper paperwork regarding
such testing.  Because the  pharmaceutical  waste generated by the Company is so
small  (averaging only about 1% of its annual waste water) it was not aware that
it was subject to these  requirements.  The Company has met with the EPA,  which
has  accepted  the  Company's   explanation  that  its  failure  to  comply  was
inadvertent,  and has agreed to enter into a consent  decree that neither admits
nor denies any  liability  but  provides  for the payment of a civil  penalty of
$23,000.  The EPA has  agreed  that as long as the  Company  files the  required
reports  that it will not pursue  any  further  action  and the  matter  will be
closed.

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

        31.1   Certification of Chief Executive Officer pursuant to Section 302
               of the Sarbanes-Oxley Act of 2002




                                       15
<page>
        31.2   Certification of Chief Financial Officer pursuant to Section 302
               of the Sarbanes-Oxley Act of 2002

        32.1   Certification of Chief Executive Officer pursuant to 18 U.S.C.
               Section 1350 as adopted pursuant to Section 906 of the Sarbanes-
               Oxley Act of 2002

        31.2   Certification of Chief Financial Officer pursuant to 18 U.S.C.
               Section 1350 as adopted pursuant to Section 906 of the Sarbanes-
               Oxley Act of 2002

     b. Reports on Form 8-K

               There was one report on Form 8-K filed on August 5, 2003
               pertaining to the issuance of an earnings release by the Company
               on August 5, 2003.


                                   SIGNATURES

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


                                      UNITED-GUARDIAN, INC.
                                       (Registrant)


                                      By:  /s/ Alfred R. Globus
                                           --------------------
                                           Alfred R. Globus
                                           Chief Executive Officer


                                       By: /s/ Kenneth H. Globus
                                           ---------------------
                                           Kenneth H. Globus
                                           Chief Financial Officer

Date:  November 11, 2003


















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