UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D C  20549
                                  FORM 10-Q


(X)  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                             EXCHANGE ACT OF 1934
                For the quarterly period ended June 30, 2001

                                      OR

( )  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                             EXCHANGE ACT OF 1934
             For the transition period from                to


                         Commission File Number 1-1463

                           UNION CARBIDE CORPORATION
                    A Subsidiary of The Dow Chemical Company
              (Exact name of registrant as specified in its charter)


           New York                             13-1421730

(State or other jurisdiction of               (I.R.S. Employer
incorporation or organization)               Identification No.)



39 Old Ridgebury Road, Danbury, CT                06817-0001
(Address of principal executive offices)           (Zip Code)


                                 203-794-2000
             Registrant's telephone number, including area code


            (Former name, former address and former fiscal year,
                       if changed since last report.)


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__


At July 31, 2001, 1,000 shares of common stock were outstanding, all of which
were held by the registrant's parent, The Dow Chemical Company.

The registrant meets the conditions set forth in General Instructions
H(1)(a) and (b) for Form 10-Q and is therefore filing this form with a
reduced disclosure format.

       Total number of sequentially numbered pages in this filing,
                       including exhibits thereto:  20

<PAGE>

                          Union Carbide Corporation
                  (a Subsidiary of The Dow Chemical Company)


                             Table of Contents


                                                                  PAGE
Part I.  Financial Information
 Item 1.    Financial Statements
               Consolidated Statements of Income                    3
               Consolidated Balance Sheets                          4
               Consolidated Statements of Cash Flows                6
               Consolidated Statements of Comprehensive Income      7
               Notes to Consolidated Financial Statements           8

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

 Item 3.    Quantitative and Qualitative Disclosure About
               Market Risk                                         16

Part II.  Other Information

 Item 1.   Legal Proceedings                                       17

 Item 6.   Exhibits and Reports on Form 8-K                        17

Signature                                                          18





Cautionary statement: All statements in this Quarterly Report on Form 10-Q
that do not reflect historical information are forward-looking statements,
within the meaning of the Private Securities Litigation Reform Act of 1995
(as amended). Forward-looking statements include statements concerning plans,
including those regarding the integration of the corporation with and into
The Dow Chemical Company ("Dow"); capital expenditures; environmental
accruals; anticipated future events; interest rate and currency risk
management; ongoing and planned capacity additions and other expansions;
joint ventures; Management's Discussion and Analysis of Financial Condition
and Results of Operations, and any other statements that do not reflect
historical information. Such forward-looking statements are subject to risks
and uncertainties. Important factors that could cause actual results to
differ materially from those discussed in such forward-looking statements
include the supply/demand balance for the corporation's products; competitive
pricing pressures; raw material availability and costs; changes in industry
production capacities and operating rates; currency exchange rates; global
economic conditions; competitive technology positions; failure by the
corporation to achieve technology objectives or complete projects on schedule
and on budget, and an inability to obtain new customers or retain existing
ones.  Accordingly, there is no assurance that the corporation's expectations
will be realized.  The corporation assumes no obligation to provide revisions
to any forward-looking statements should circumstances change.

                                    -2-
<PAGE>


                        PART I. FINANCIAL INFORMATION
Item 1:  Financial Statements:

<TABLE>
<CAPTION>
                 Union Carbide Corporation and Subsidiaries
                      Consolidated Statements of Income





                                                       Three Months Ended      Six Months Ended
                                                       June 30,   June 30,    June 30,   June 30,
In millions (Unaudited)                                  2001       2000        2001       2000


<S>                                                    <C>        <C>         <C>         <C>
Net trade sales                                        $ 1,166    $ 1,674     $ 2,702     $ 3,291
Net sales to related companies                             530          -         530           -
     Total Net Sales                                   $ 1,696    $ 1,674     $ 3,232     $ 3,291

 Cost of sales                                           1,549      1,436       3,025       2,838
 Research and development expenses                          34         58          80         116
 Selling, general and administrative expenses               52         59         107         123
 Amortization of intangibles                                 4          3           7           7
 Merger-related expenses and restructuring                 (13)         -       1,262           -
 Insurance and finance company
   operations, pretax income (loss)                         (2)         4          (1)          5
 Equity in earnings of nonconsolidated affiliates           11         52          23          94
 Sundry income - net                                        25         29          24          36

Earnings (Loss) Before Interest, Income Taxes, and
     Minority Interests                                    104        203      (1,203)        342

 Interest income                                             2          3           4          19
 Interest expense and amortization of debt discount         47         45          98          82

Income (Loss) Before Income Taxes and Minority Interests    59        161      (1,297)        279

 Provision (benefit) for income taxes                       18         29        (468)         49
 Minority interests' share in income                         2          2           3           3

Net Income (Loss)                                      $    39    $   130     $  (832)   $    227




Depreciation                                           $   111    $    99     $   211    $    197


Capital Expenditures                                   $    25    $   127     $    59    $    322




See Notes to Consolidated Financial Statements.
</TABLE>

                                      -3-
<PAGE>
<TABLE>
<CAPTION>

                   Union Carbide Corporation and Subsidiaries
                           Consolidated Balance Sheets


                                                            June 30,  Dec. 31,
In millions (Unaudited)                                       2001      2000
<S>                                                         <C>       <C>
Assets
Current Assets
  Cash and cash equivalents                                  $    40    $   63
  Marketable securities                                            -        74
  Accounts and notes receivable:
       Trade (net of allowance for doubtful receivables -
                   2001: $14; 2000: $11)                         457       897
       Related companies                                         665         -
       Other                                                     516       137
  Inventories:
       Finished and work in process                              290       557
       Materials and supplies                                    177       193
  Deferred income tax assets - current                           514       142
  Other current assets                                            11       113

  Total current assets                                         2,670     2,176

Investments
  Investment in nonconsolidated affiliates                       840     1,008
  Other investments                                              311        97
  Noncurrent receivables                                         191       154

  Total investments                                            1,342     1,259

Property
  Property                                                     9,153     9,361
  Less accumulated depreciation                                5,326     4,840

  Net property                                                 3,827     4,521

Other Assets
  Goodwill (net of accumulated amortization -
       2001: $43; 2000: $54)                                      35        41
  Deferred charges and other assets                              348       349

  Total other assets                                             383       390

Total assets                                                 $ 8,222   $ 8,346





See Notes to Consolidated Financial Statements.

</TABLE>
                                       -4-
<PAGE>
<TABLE>
<CAPTION>

                   Union Carbide Corporation and Subsidiaries
                           Consolidated Balance Sheets


                                                            June 30,  Dec. 31,
In millions (Unaudited)                                       2001      2000
<S>                                                         <C>       <C>
Liabilities and Stockholders' Equity
Current Liabilities
  Notes payable:
       Related companies                                     $ 1,391    $     -
       Other                                                      32      1,171
  Long-term debt due within one year                               1          7
  Accounts payable:
       Trade                                                     357        703
       Related companies                                         332          -
       Other                                                      43         67
  Income taxes payable                                            47          -
  Deferred income tax liabilities - current                       13          -
  Accrued and other current liabilities                          275        352

  Total current liabilities                                    2,491      2,300

Long-Term Debt                                                 1,744      1,748

Other Noncurrent Liabilities
  Deferred income tax liabilities - noncurrent                   299        278
  Pension and other postretirement benefits -
       noncurrent                                                685        492
  Other noncurrent obligations                                 1,196        834

  Total other noncurrent liabilities                           2,180      1,604

Minority Interest in Subsidiaries                                 43         40

Stockholders' Equity
  Common stock - issued - 1,000 shares
                (158,994,683 shares in 2000)                       -        159
  Additional paid-in capital                                       -        217
  Unearned ESOP shares                                           (50)       (50)
  Retained earnings                                            2,079      3,572
  Accumulated other comprehensive loss                          (265)      (224)
  Treasury stock, at cost - no shares
                (23,431,939 shares in 2000)                        -     (1,020)

  Total stockholders' equity                                   1,764      2,654

Total Liabilities and Stockholders' Equity                   $ 8,222    $ 8,346





See Notes to Consolidated Financial Statements.

</TABLE>
                                       -5-
<PAGE>
<TABLE>
<CAPTION>


                   Union Carbide Corporation and Subsidiaries
                      Consolidated Statements of Cash Flows


                                                           Six Months Ended June 30,
In millions (Unaudited)                                         2001       2000
<S>                                                        <C>           <C>
Operating Activities
  Net income (loss)                                        $    (832)    $ 227
  Adjustments to reconcile net income (loss) to net
    cash provided by operating activities:
      Depreciation and amortization                              218       204
      Provision (credit) for deferred income taxes              (334)       58
      Undistributed earnings of nonconsolidated affiliates       (14)      (57)
      Minority interests' share in income                          3         3
      Other net gain                                             (39)      (54)
      Merger-related expenses and restructuring                1,028         -
      Tax benefit-nonqualified stock options exercises             4         6
  Changes in assets and liabilities that provided
    (used) cash:
      Accounts and notes receivable                              110       (24)
      Related company receivables                               (799)        -
      Inventories                                                209       (63)
      Accounts payable                                          (417)        9
      Related company payables                                   512         -
      Other assets and liabilities                              (160)      (45)

  Cash provided by (used in) operating activities               (511)      264

 Investing Activities
  Capital expenditures                                           (59)     (322)
  Proceeds from sales of property                                  -         8
  Investments in nonconsolidated affiliates                      (63)     (135)
  Proceeds from sale of nonconsolidated affiliate                180         -
  Proceeds from the sale of investments                           96        65
  Purchase of investments                                        (90)      (38)

  Cash provided by (used in) investing activities                 64      (422)

 Financing Activities
  Change in short-term notes payable                            (939)      330
  Change in notes payable to related companies                 1,391         -
  Repayments of long-term debt                                    (5)     (114)
  Purchases of treasury stock                                     (1)        -
  Proceeds from sales of common stock                              6        20
  Dividends paid to stockholders                                 (28)      (61)

  Cash provided by financing activities                          424       175

Effect of Exchange Rate Changes on Cash and
   Cash Equivalents                                                -         1

Summary
  Increase (decrease) in cash and cash equivalents               (23)       18
  Cash and cash equivalents, beginning-of-period                  63        41

Cash and cash equivalents, end-of-period                       $  40     $  59



See Notes to Consolidated Financial Statements.
</TABLE>

                                       -6-
<PAGE>



<TABLE>
<CAPTION>
                         Union Carbide Corporation and Subsidiaries
                       Consolidated Statements of Comprehensive Income



                                                       Three Months Ended      Six Months Ended
                                                       June 30,   June 30,    June 30,   June 30,
In millions (Unaudited)                                  2001       2000        2001       2000
<S>                                                    <C>        <C>        <C>        <C>
Net income (loss)                                      $    39    $   130    $   (832)  $   227
Other comprehensive income (loss), net of tax:
  Unrealized gains and losses on investments                (2)         -          (3)        4
  Cumulative translation adjustments                        41        (25)        (38)      (35)

Comprehensive income (loss)                            $    78    $   105    $   (873)  $   196



See Notes to Consolidated Financial Statements.
</TABLE>
                                   -7-
<PAGE>


               Union Carbide Corporation and Subsidiaries
               Notes to Consolidated Financial Statements



Note A - Consolidated Financial Statements

The unaudited interim financial statements reflect all adjustments
(consisting of normal recurring accruals) which, in the opinion of
management, are considered necessary for a fair presentation of the
results for the periods covered.  Certain reclassifications of prior
period amounts have been made to conform to the current period's
presentation.  These statements should be read in conjunction with the
audited Notes to Financial Statements of Union Carbide Corporation and
Subsidiaries (the "corporation" or "UCC") in the 2000 Annual Report on
Form 10-K.

Condensed Summary of Significant Accounting Policies:

Business and Geographic Segment Information - Effective with the merger
of the corporation into a wholly owned subsidiary of Dow (the "Dow
Merger"), the corporation's business activities were fully integrated
with those of Dow and are no longer operated as separate business units.
Dow conducts its worldwide operations through global businesses which
extend beyond the boundaries of both geography and legal entities.  This
results in the corporation's business activities comprising fully
integrated components of Dow's global businesses rather than stand-alone
operations.  Because there are no separable reportable business segments
for the corporation under Statement of Financial Accounting Standards
("Statement") No. 131, "Disclosures about Segments of an Enterprise and
Related Information," and the information used by the chief operating
decision maker regarding the corporation's operations relates to the
corporation in its entirety, the corporation's results are reported as a
single operating segment.  Prior to the Dow Merger, the corporation was
managed as two separate business segments, Specialties and Intermediates
and Basic Chemicals and Polymers, as well as a non-operating segment
("Other").  Prior periods have been restated to conform to the current
period's presentation.


Research and Development - Research and development costs are charged to
expense as incurred.  Depreciation expense applicable to research and
development facilities and equipment is included in "Research and
development expenses" in the Consolidated Statements of Income.

Related Companies - Significant transactions with the corporation's
parent company, Dow, or other Dow subsidiaries have been characterized as
related company transactions in the consolidated financial statements.

Earnings Per Share - In accordance with Statement No. 128, "Earnings Per
Share," the presentation of earnings per share is not required in
financial statements of wholly owned subsidiaries.

                                -8-
<PAGE>

Note B - The Dow Merger and Merger-related Expenses and Restructuring

On February 6, 2001, the corporation merged with a wholly owned
subsidiary of Dow.  As a result of the merger, each share of Union
Carbide common stock outstanding immediately prior to the merger was
exchanged for 1.611 shares of Dow common stock, and Union Carbide became
a wholly owned subsidiary of Dow.

Contemporaneous with the merger, certain rights vested and stock units
equivalent of Union Carbide common stock were converted into stock units
equivalent of Dow common stock under various employee benefit and
incentive plans, such as the ESOP Plan, the 1997 Union Carbide Long-Term
Incentive Plan and the deferred compensation plan.

On February 23, 2001, the corporation cancelled its unused $1 billion
major bank credit agreement.

In order to satisfy the European Commission's condition for approval of
the merger, the corporation divested its 50-percent interest in Polimeri
Europa S.r.l. ("Polimeri Europa") to EniChem S.p.A. in April 2001.

On March 29, 2001, Dow's management made certain decisions relative to
employment levels, duplicate assets and facilities and excess capacity
resulting from the merger of the corporation into a subsidiary of Dow.
These decisions were based on Dow management's assessment of the actions
necessary to achieve synergies as the result of the merger.  The economic
effects of these decisions, combined with merger-related transaction
costs and certain asset impairments, resulted in a pretax special charge
in the first quarter of $1,275 million which was reduced by $13 million
in the second quarter.  The following table shows the major components of
the special charge:

          In millions
          Transaction costs                          $   41
          Labor-related costs                           616
          Write-down of assets and facilities           605
          Total                                      $1,262

Transaction costs of $41 million consisted primarily of investment
banking, legal and accounting fees, all of which had been paid at March
31, 2001.

Employee-related costs consisted predominantly of provisions for employee
severance, change of control obligations, medical and retirement
benefits, and outplacement services. Dow's integration plans include a
workforce reduction of approximately 4,500 people, primarily from the
corporation's administrative, marketing, purchasing, research and
development, and manufacturing workforce. The charge for severance was
based upon the severance plan provisions communicated to employees.
Headcount reductions began in the second quarter of 2001. More than one-
half of the reductions will be completed by the end of September;
approximately 80 percent will be completed by the end of the first 12
months following the merger. The corporation expects that approximately
66 percent of the employee-related costs will be expended in cash within
the next two years, though the timing of severance payments is dependent
upon employee elections. Expenditures with respect to employee-related
costs associated with pension and postretirement benefit plans will occur
over a much more extended period that is not currently determinable.

                               -9-
<PAGE>

The special charge included $605 million for the write-down of duplicate
assets and facilities directly related to the merger, the loss on
divestitures required to obtain regulatory approval for the merger, asset
impairments and lease abandonment reserves. Duplicate assets consist
principally of capitalized software costs, information technology
equipment, research and development facilities and equipment, all of
which were written off during the first quarter. The fair values of the
impaired assets, which include production facilities and transportation
equipment, were determined based on discounted cash flows and an
appraisal, respectively. These components of the special charge will
require limited future cash outlays, and will result in a decrease in
annual depreciation of approximately $65 million.

As of June 30, 2001, severance of $261 million had been paid to 1,344
former employees.

The following table summarizes the activity in the special charge reserve
for the three month periods ended March 31, 2001 and June 30, 2001:

     In millions
                         Additions   Charges
               Opening      To       Against      Balance at
      Quarter  Balance   Reserve     Reserve      Period End
       1Q01        -     $1,275      $ 646         $ 629
       2Q01    $ 629        (13)       158           458


Note C - Commitments and Contingencies

The corporation has two major agreements for the purchase of ethylene-
related products and two other purchase agreements in the U.S. and
Canada.  The net present value of the fixed and determinable portion of
obligations under these purchase commitments at June 30, 2001 totaled
$172 million including one contract for the purchase of ethylene from Dow
representing $134 million of this obligation.

The corporation is subject to loss contingencies resulting from
environmental laws and regulations, which include obligations to remove
or remediate the effects on the environment of the disposal or release of
certain wastes and substances at various sites.  The corporation has
established accruals in current dollars for those hazardous waste sites
where it is probable that a loss has been incurred and the amount of the
loss can be reasonably estimated.  The reliability and precision of the
loss estimates are affected by numerous factors, such as different stages
of site evaluation, the allocation of responsibility among potentially
responsible parties and the assertion of additional claims.  The
corporation adjusts its accruals as new remediation requirements are
defined, as information becomes available permitting reasonable estimates
to be made, and to reflect new and changing facts.

At June 30, 2001, the corporation had established environmental
remediation accruals in the amount of $173 million.  These accruals have
two components, estimated future expenditures for site investigation and
cleanup and estimated future expenditures for closure and postclosure
activities.  In addition, the corporation had environmental loss
contingencies of $64 million.

                                -10-
<PAGE>

The corporation has sole responsibility for the remediation of
approximately 40 percent of its environmental sites for which accruals
have been established.  These sites are well advanced in the
investigation and cleanup stage.  The corporation's environmental
accruals at June 30, 2001 included $141 million for these sites, of which
$36 million was for estimated future expenditures for site investigation
and cleanup and $105 million was for estimated future expenditures for
closure and postclosure activities.  In addition, $49 million of the
corporation's environmental loss contingencies related to these sites.
The three sites with the largest total potential cost to the corporation
are nonoperating sites.  Of the above accruals, these sites accounted for
$44 million, of which $9 million was for estimated future expenditures
for site investigation and cleanup and $35 million was for estimated
future expenditures for closure and postclosure activities.  In addition,
$32 million of the above environmental loss contingencies related to
these sites.

The corporation does not have sole responsibility at the remainder of its
environmental sites for which accruals have been established.  All of
these sites are in the investigation and cleanup stage.  The
corporation's environmental accruals at June 30, 2001 included
$32 million for estimated future expenditures for site investigation and
cleanup at these sites.  In addition, $15 million of the corporation's
environmental loss contingencies related to these sites.  The largest two
of these sites are also nonoperating sites.  Of the above accruals, these
sites accounted for $10 million for estimated future expenditures for
site investigation and cleanup.  In addition, $2 million of the above
environmental loss contingencies related to these sites.

In 2000, worldwide expenses related to environmental protection for
compliance with federal, state and local laws regulating solid and
hazardous wastes and discharge of materials to air and water, as well as
for waste site remedial activities, totaled $104 million.  Expenses in
1999 and 1998 were $118 million and $91 million, respectively.  While
estimates of the costs of environmental protection for 2001 are
necessarily imprecise, the corporation estimates that these expenses will
approximate the average of the last three years.

The corporation severally guaranteed up to approximately $54 million at
June 30, 2001 of EQUATE Petrochemical Company K.S.C.'s ("EQUATE") debt
and working capital financing needs.  The corporation has also severally
guaranteed certain sales volume targets until EQUATE's sales capabilities
are proved.  In addition, the corporation has pledged its shares in
EQUATE as security for EQUATE's debt.  The corporation has political risk
insurance coverage for its equity investment and a majority of its
guarantee of EQUATE's debt.

The corporation had additional contingent obligations at June 30, 2001
totaling $66 million, of which $26 million related to guarantees of debt.

The corporation and its consolidated subsidiaries are involved in a
number of legal proceedings and claims with both private and governmental
parties.  These cover a wide range of matters, including, but not limited
to: product liability; trade regulation; governmental regulatory
proceedings; health, safety and environmental matters; employment;
patents; contracts; taxes; and commercial disputes.  In some of these
legal proceedings and claims, the cost of remedies that may be sought or
damages claimed is substantial.

                               -11-
<PAGE>

The corporation has recorded nonenvironmental litigation accruals of
$172 million and related insurance recovery receivables of $141 million.
At June 30, 2001, the corporation had nonenvironmental litigation loss
contingencies of $59 million.

While it is not possible at this time to determine with certainty the
ultimate outcome of any of the legal proceedings and claims referred to
in this note, management believes that adequate provisions have been made
for probable losses with respect thereto and that such ultimate outcome,
after provisions therefor, will not have a material adverse effect on the
consolidated financial position of the corporation, but could have a
material effect on consolidated results of operations in a given quarter
or year.  Should any losses be sustained in connection with any of such
legal proceedings and claims in excess of provisions therefor, they will
be charged to income when determinable.


Note D - Exchange of Assets with Related Companies

Effective June 30, 2001, the corporation contributed all of its ownership
interests in several wholly owned entities in Europe and Latin America to
wholly owned subsidiaries of Dow.  In return for the contribution of
interests, the corporation received stock in the acquiring company equal
to the book value of the net assets that the corporation contributed.
The corporation's percentage ownership in these entities ranges from 10
to 15 percent.  These investments have been accounted for using the cost
method of accounting and have been included in "Other investments" on the
balance sheet.  The following chart reflects the combined book value of
these entities on the effective date:

In millions
Balance Sheet Data
Current assets                                                  $496
Non-current assets                                               123
    Total assets                                                $619

Current liabilities                                             $454
Non-current liabilities                                            5
    Total liabilities                                           $459

Net assets                                                      $160

Income Statement Data
Sales                                                           $455
EBIT                                                            $147
Net Income                                                      $138

Income statement data represents amounts included in the corporation's
consolidated results for the six months ended June 30, 2001.

The corporation will continue to integrate into the Dow organization over
the next several months in order to realize synergies of the merger.

                                  -12-
<PAGE>

Note E - Sale of Receivables

During the second quarter of 2001, the corporation sold $300 million in
trade receivables to a third party.  In those sales, Dow will be
providing the servicing responsibilities.  The third party has no recourse
against the corporation for receivables which are in default.  In the
second quarter of 2001, the corporation recorded a pretax loss of
$0.7 million on the sale of these receivables.

Note F - Liquidation of LIFO Inventory

During the quarter ended June 30, 2001, certain inventory quantities were
reduced which resulted in a liquidation of certain LIFO inventory layers
carried at lower costs which prevailed in prior years.  The effect of the
liquidation was to decrease cost of goods sold by $51 million and
increase after-tax earnings by $33 million.

Note G - Accounting Changes

In 1998, the Financial Accounting Standards Board ("FASB") issued Statement
No. 133, "Accounting for Derivative Instruments and Hedging Activities."
It requires that an entity recognize all derivative instruments as either
assets or liabilities in the statement of financial position and measure
those instruments at fair value.  Changes in the fair value of those
derivatives will be reported in earnings or accumulated other
comprehensive loss, depending on the uses of the derivatives and whether
they qualify for hedge accounting.  This Statement, as amended by
Statement No. 137, "Accounting for Derivative Instruments and Hedging
Activities - Deferral of the Effective Date of FASB Statement No. 133,"
and Statement No. 138, "Accounting for Certain Derivative Instruments and
Certain Hedging Activities - an amendment of FASB Statement No. 133," is
effective for all fiscal quarters of fiscal years beginning after June
15, 2000.  The corporation adopted the provisions of Statement No. 133,
as amended, on January 1, 2001.  Due to the corporation's limited use of
financial instruments to manage its exposure to market risks, primarily
related only to changes in foreign currency exchange rates, the adoption
of Statement No. 133 on January 1, 2001 did not have a material effect on
the corporation's financial position or results of operations.

In 1999, the Securities and Exchange Commission issued Staff Accounting
Bulletin ("SAB") 101, "Revenue Recognition in Financial Statements,"
which summarizes the staff's views regarding the application of generally
accepted accounting principles to selected revenue recognition issues.
The corporation adopted the provisions of SAB 101 on October 1, 2000, the
effect of which was not material to the corporation's financial position
or results of operations.

In July 2001, the FASB issued Statement No. 141, "Business Combinations," and
Statement No. 142, "Goodwill and Other Intangible Assets." These Statements
replace Accounting Principles Board ("APB") Opinion No. 16, "Business
Combinations," and APB Opinion No. 17, "Intangible Assets," respectively.
Under Statement No. 141 all business combinations initiated after June 30, 2001
are accounted for using only the purchase method. Statement No. 142 is
effective for fiscal years beginning after December 15, 2001. Under this
Statement, goodwill will not be amortized, but will be subject to impairment
testing. The corporation is currently assessing the impact of adopting these
Statements.

                                 -13-
<PAGE>

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

Pursuant to General Instruction H of Form 10-Q, this section includes only
management's narrative analysis of the results of operations for the three
and six month periods ended June 30, 2001, the most recent periods, and the
three and six month periods ended June 30, 2000, the same periods in the year
immediately preceding it.

On February 6, 2001, the corporation merged with a wholly owned subsidiary of
Dow.  As a result of the merger, each share of Union Carbide common stock
outstanding immediately prior to the merger was exchanged for 1.611 shares of
Dow common stock and Union Carbide became a wholly owned subsidiary of Dow.
The merger received clearance from the U.S. Federal Trade Commission, the
European Commission and the Canadian Competition Bureau, subject to the
divestiture of certain assets and the contribution of UNIPOL (trademark
symbol) polyethylene technology licensing and polyethylene conventional
catalyst businesses of the corporation to its joint venture Univation
Technologies, LLC.  The transaction is intended to qualify as a tax-free
reorganization for U.S. federal income tax purposes and has been accounted
for under the pooling-of-interests method of accounting.

In order to realize synergies of the merger, on June 30, 2001, the
corporation contributed all of its ownership interests in several wholly
owned entities in Europe and Latin America to wholly owned subsidiaries of
Dow.  In return for the contribution of interests, the corporation received
stock in each acquiring company equal to the book value of the net assets
that the corporation contributed.  The corporation's percentage ownership in
these entities ranges from 10 to 15 percent. For further details, see Note D
to the corporation's consolidated financial statements included in this
Quarterly Report on Form 10-Q.  Further integration of the corporation with
and into the Dow organization is expected to occur over the next several
months.


Results of Operations

The corporation reported net income of $39 million for the second quarter of
2001, compared with $130 million for the same quarter of 2000.  Net loss for
the first half of 2001 was $832 million, compared with net income of $227 for
the same half of 2000.  In the first half of 2001, results of operations were
impacted by a special charge of $1,262 million ($829 million after tax)
related to the merger of the corporation into a subsidiary of Dow.

The first half of 2001 proved to be one of the most challenging periods ever
for the North American chemical industry and for the corporation.  Total net
sales for the second quarter of 2001 increased 1 percent to $1,696 million
from $1,674 million in the second quarter of 2000.  However, net trade sales
for the second quarter of 2001 declined 29 percent from $1,674 million in the
second quarter of 2000 to $1,166 million in the second quarter of 2001.  Net
trade sales for the first half of 2001, compared with the same half of 2000,
decreased 18 percent from $3,291 million to $2,702 million.  In the second
quarter of 2001, the corporation commenced selling product to its parent
company, Dow.  The effect of the related company sales accounted for the
majority of the decline in trade sales, primarily in volume, for both the
quarterly and year-to-date periods.  Volume was also negatively impacted by
the supply/demand imbalances within the chemical industry.  The most
significant volume decline occurred in ethylene oxide/glycol, where weak
demand and high ethylene costs led to the temporary shutdown of production at

                                     -14-
<PAGE>

the corporation's ethylene glycol facility in Prentiss, Alberta, Canada,
during the first half of the year.  In comparison with the same periods in
2000, overall average selling prices for the current quarter were down 1
percent while, for the six month period, average selling prices increased 2
percent.  Average selling prices in products such as oxide derivatives,
industrial chemicals, and organic intermediates, solvents and monomers
reported the majority of the increases; however, these increases were partly
offset by declines in the corporation's more basic chemicals and plastics,
such as ethylene oxide/glycol, polyethylene and polypropylene.

Although total net sales remained relatively flat for the second quarter and
first six months of 2001 compared with 2000, cost of sales increased by $113
million, or 8 percent, and $187 million, or 7 percent, for the same periods,
respectively.  While the cost of oil and natural gas-related raw materials
and energy dropped from the first quarter 2001 levels, total costs were
higher for the three and six month periods ended June 30, 2001 as compared
with the same periods in the prior year.  Gross margin was 8.7 percent for
the second quarter of 2001, a decline from 14.2 percent for the same period
in 2000.  For the first six months of 2001, gross margin was 6.4 percent
compared with 13.8 percent for the same period last year. Sales to Dow, in
the second quarter of 2001, were made at cost-to-produce realizing no profit.
Additionally, competitive pressures in most products prevented the
corporation from raising average selling prices enough to totally offset the
increase in raw material costs that the company experienced throughout 2000
and the beginning of 2001.  Some margin improvement in the second quarter of
2001 was obtained by producing a greater volume of polyethylene at the
corporation's new Canadian plant, where raw material cost is advantaged.

Research and development and selling, general and administrative expenses
declined $24 million and $7 million, respectively, for the second quarter of
2001 compared with the same quarter of 2000.  For the first half of 2001,
compared with the same half of 2000, research and development, and selling,
general and administrative expenses declined $36 million and $16 million,
respectively.  These declines are primarily the result of decreases in
accruals for employee incentive plans coupled with synergies associated with
the integration of the corporation into Dow.

In the first half of 2001, pretax costs of $1,262 million were recorded for
merger-related expenses and restructuring.  These costs, the majority of
which were recorded in the first quarter, included transaction costs,
employee severance, and the write-down of duplicate assets and facilities.
For further details, see Note B to the corporation's consolidated financial
statements included in this Quarterly Report on Form 10-Q.

Equity in earnings of nonconsolidated affiliates decreased from $52 million
in the second quarter of 2000 to $11 million in the same quarter of 2001
while earnings for the first six months declined from $94 million in 2000 to
$23 million in 2001.  These declines principally reflect the absence of
earnings from Polimeri Europa, which was required to be divested as part of
the merger clearance from the European Union.  Additionally, decreased
earnings at UOP LLC ("UOP") and EQUATE were partly offset by lower losses
related to Aspell Polymeres SNC.  UOP's earnings continue to be negatively
impacted by the slowdown of projects in the oil and gas industry which the
venture services.  EQUATE's earnings reflect weaker market conditions for
ethylene derivatives as compared with the same periods last year.

                                  -15-
<PAGE>

Sundry income - net for the second quarter and first six months of 2000
included an $18 million ($11 million after tax) gain on shares received and
sold in connection with the demutualization of Metropolitan Life Insurance
Company a provider of certain employee benefit programs for the corporation.

Interest income for the second quarter of 2001 remained relatively flat with
the second quarter of 2000.  However, interest income of $4 million in the
first half of 2001 declined $15 million from the $19 million reported for the
first half of 2000.  The decline in the first half amount was primarily the
result of $15 million in interest income associated with a tax refund which
was received in the first quarter of 2000.

Although interest expense for the quarter ended June 30, 2001 was comparable
to the same period in 2000, interest expense for the first half of 2001
increased $16 million as compared with the first half of 2000.  The majority
of the year-to-date increase represented a decline in capitalized interest
from the prior year's first half. Capitalized interest for the first six
months of 2000 related primarily to the corporation's olefins and
polyethylene projects in Canada, both of which were completed in the second
half of 2000.


Environmental

Estimates of future expenses related to environmental protection for
compliance with federal, state and local laws regulating solid and hazardous
wastes and discharge of materials to air and water, as well as for waste site
remedial activities, have not changed materially since December 31, 2000.
The reliability and precision of the loss estimates are affected by numerous
factors, such as different stages of site evaluation, the allocation of
responsibility among potentially responsible parties and the assertion of
additional claims.  The corporation's environmental exposures are discussed
in more detail in Note C to the consolidated financial statements included in
this Quarterly Report on Form 10-Q.

Accounting Changes

See Note G to the consolidated financial statements included in this
Quarterly Report on Form 10-Q.





Item 3:  Qualitative and Quantitative Disclosure About Market Risk

Omitted pursuant to General Instruction H of Form 10-Q.

                                 -16-
<PAGE>

                      Part II. Other Information

Item 1.  Legal Proceedings

         See Note C to the corporation's consolidated financial statements
         included in this Quarterly Report on Form 10-Q.

Item 6.  Exhibits and Reports on Form 8-K
         (a)   Exhibits.

               3.1   Certificate of Change of Union Carbide Corporation
                     Under Section 805-A of the Business Corporation Law,
                     dated April 27, 2001.


         (b)   Reports on Form 8-K.

               No Current Reports on Form 8-K were filed during this period.



                                       -17-
<PAGE>




SIGNATURE



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.


                                           Union Carbide Corporation
                                                  (Registrant)




Date: August 14, 2001                   By:  /s/ Frank H. Brod
                                             Frank H. Brod
                                             Vice President & Controller
                                             The Dow Chemical Company
                                             Authorized Representative of
                                             Union Carbide Corporation



                                 -18-
<PAGE>