UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                             Washington, DC  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 March 31, 2002

[ ] Transition  Report Under Section 13 or 15(d) of The Securities  Exchange Act
    of 1934

            For the transition period from ______________ to _____________

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


                        Commission File Number: 0-31297

                         Shallbetter Industries, Inc.
       (Exact name of small business issuer as specified in its charter)

          Minnesota                                          41-1961936
-----------------------------                       ----------------------------
  (State of incorporation)                           (IRS Employer ID Number)

               11900 Wayzata Blvd., Suite 100, Hopkins MN 55305
               ------------------------------------------------
                   (Address of principal executive offices)

                                (952) 541-1155
                                --------------
                          (Issuer's telephone number)


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


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 registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days. YES X NO

State the number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date: April 19, 2002: 1,207,885

Transitional Small Business Disclosure Format (check one):  YES       NO X
                                                                ----    ---



<PAGE>



                         Shallbetter Industries, Inc.

               Form 10-QSB for the Quarter ended March 31, 2002

                               Table of Contents


                                                                       Page
Part I - Financial Information

  Item 1  Financial Statements                                           3

  Item 2  Management's Discussion and Analysis or Plan of Operation     11


Part II - Other Information

  Item 1  Legal Proceedings                                             12

  Item 2  Changes in Securities                                         12

  Item 3  Defaults Upon Senior Securities                               12

  Item 4  Submission of Matters to a Vote of Security Holders           12

  Item 5  Other Information                                             12

  Item 6  Exhibits and Reports on Form 8-K                              12


Signatures                                                              12


                                       2
<PAGE>



Part 1 - Item 1 - Financial Statements

                         SHALLBETTER INDUSTRIES, INC.
                                Balance Sheets
                            March 31, 2001 and 2000


                                                        March 31,     March 31,
                                                          2002          2001
                                                      ------------  ------------
                                    ASSETS
Current Assets
  Cash in bank                                        $       74    $    1,335
                                                      ------------  ------------

Total Assets                                          $       74    $    1,335
                                                      ============  ============




                     LIABILITIES AND SHAREHOLDERS' EQUITY

Current Liabilities
  Accounts payable - trade                            $    2,358    $        -
  Advances from Officer                                    6,600         2,000
                                                      ------------  ------------

  Total Liabilities                                        8,958         2,000
                                                      ------------  ------------

Commitments and Contingencies

Shareholders' Equity
  Preferred stock - $0.01 par value.
   5,000,000 shares authorized;
   none issued and outstanding                                 -             -
  Common stock - $0.01 par value.
   45,000,000 shares authorized.
   1,207,885 shares issued and outstanding                12,079        12,079
  Additional paid-in capital                              17,650        17,650
  Accumulated deficit                                    (38,613)      (30,394)
                                                      ------------  ------------

   Total Shareholders' Equity                             (8,884)         (665)
                                                      ------------  ------------

Total Liabilities and Shareholders' Equity            $       74    $    1,335
                                                      ============  ============


   The financial information presented herein has been prepared by management
           without audit by independent certified public accountants.
   The accompanying notes are an integral part of these financial statements.

                                        3

<PAGE>



                         SHALLBETTER INDUSTRIES, INC.
                Statements of Operations and Comprehensive Loss
                  Three months ended March 31, 2001 and 2000


                                                      Three months  Three months
                                                         ended         ended
                                                        March 31,     March 31,
                                                          2002          2001
                                                      ------------  ------------

Revenues                                              $         -   $         -
                                                      ------------  ------------

Expenses
  General and administrative                                2,364         1,521
                                                      ------------  ------------

   Total expenses                                           2,364         1,521
                                                      ------------  ------------

Loss from operations                                       (2,364)       (1,521)

Other income
  Interest income                                               -             -
                                                      ------------  ------------

Loss before Income Taxes                                   (2,364)       (1,521)

Provision for Income Taxes                                      -             -
                                                      ------------  ------------

Net Loss                                                    (2,364)      (1,521)

Other comprehensive income                                       -            -
                                                      -------------  -----------

Comprehensive Loss                                    $     (2,364)  $   (1,521)
                                                      =============  ===========

Loss per weighted-average share of
  common stock outstanding,
  computed on Net Loss - basic
  and fully diluted                                            nil          nil
                                                      =============  ===========

Weighted-average number of shares
  of common stock outstanding                            1,207,885    1,207,885
                                                      =============  ===========



   The financial information presented herein has been prepared by management
           without audit by independent certified public accountants.
   The accompanying notes are an integral part of these financial statements.

                                        4

<PAGE>



                         SHALLBETTER INDUSTRIES, INC.
                           Statements of Cash Flows
                  Three months ended March 31, 2001 and 2000


                                                      Three months  Three months
                                                         ended         ended
                                                        March 31,     March 31,
                                                          2002          2001
                                                      ------------  ------------

Cash Flows from Operating Activities
  Net Loss                                            $    (2,364)  $    (1,521)
  Adjustments to reconcile net income to net cash
   provided by operating activities
     Depreciation                                               -             -
     Increase in Accounts payable - trade                   2,358             -
                                                      ------------  ------------

Net cash provided by (used in) operating activities            (6)       (1,521)
                                                      ------------  ------------

Cash Flows from Investing Activities                            -             -
                                                      ------------  ------------

Cash Flows from Financing Activities
  Advances from shareholder                                     -         2,000
  Proceeds from sale of common stock                            -             -
                                                      ------------  ------------

Net cash provided by financing activities                       -         2,000
                                                      ------------  ------------

Increase (Decrease) in Cash and Cash Equivalents               (6)          479

Cash and cash equivalents at beginning of period               80           856
                                                      ------------  ------------

Cash and cash equivalents at end of period            $        74   $     1,335
                                                      ============  ============


Supplemental Disclosures of Interest and
Income Taxes Paid
  Interest paid during the period                     $         -   $         -
                                                      ============  ============
  Income taxes paid (refunded)                        $         -   $         -
                                                      ============  ============



   The financial information presented herein has been prepared by management
           without audit by independent certified public accountants.
   The accompanying notes are an integral part of these financial statements.

                                        5

<PAGE>



                         SHALLBETTER INDUSTRIES, INC.

                         Notes to Financial Statements


NOTE A - Organization and Description of Business

Shallbetter  Industries,  Inc. (Company) was initially incorporated on September
8, 1968 under the laws of the State of Minnesota.  The Company has not conducted
any  business  operations  or  maintained  any assets  since  1982.  The current
business purpose of the Company is to seek out and obtain a merger,  acquisition
or outright sale transaction  whereby the Company's  shareholders  will benefit.
The Company is not currently  engaged in any  negotiations and continues to seek
an appropriate merger or acquisition candidate.

During interim periods, the Company follows the accounting policies set forth in
its annual  audited  financial  statements  filed with the U. S.  Securities and
Exchange  Commission  on its  Annual  Report on Form  10-KSB  for the year ended
December 31, 2001.  The  information  presented  within these interim  financial
statements  may not  include all  disclosures  required  by  generally  accepted
accounting  principles  and the  users of  financial  information  provided  for
interim periods should refer to the annual  financial  information and footnotes
when reviewing the interim financial results presented herein.

In the opinion of management,  the accompanying  interim  financial  statements,
prepared in  accordance  with the U. S.  Securities  and  Exchange  Commission's
instructions   for  Form  10-QSB,   are   unaudited  and  contain  all  material
adjustments,  consisting  only of  normal  recurring  adjustments  necessary  to
present fairly the financial condition,  results of operations and cash flows of
the Company for the respective  interim  periods  presented.  The current period
results of operations are not necessarily indicative of results which ultimately
will be reported for the full fiscal year ending December 31, 2002.

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


NOTE B - Going Concern Uncertainty

The Company has not conducted any business  operations or maintained  any assets
since  1982.  The  current  business  purpose of the  Company is to seek out and
obtain a merger,  acquisition or outright sale transaction whereby the Company's
shareholders  will  benefit.  The  Company  is  not  currently  engaged  in  any
negotiations  and  continues  to  seek  an  appropriate  merger  or  acquisition
candidate.

The  Company's  need for  capital  may change  dramatically  if it  acquires  an
interest  in a business  opportunity  during the next 12 months.  The  Company's
current  operating  plan  is to (i)  handle  the  administrative  and  reporting
requirements  of a public  company;  and (ii) search for  potential  businesses,
products,  technologies and companies for acquisition.  At present,  the Company
has no understandings, commitments or agreements with respect to the acquisition
of any  business,  product,  technology or company and there can be no assurance
that the Company will identify any such business, product, technology or company
suitable for acquisition in the future.  Further, there can be no assurance that
the Company would be successful in  consummating  any  acquisition  on favorable
terms  or that it will be able  to  profitably  manage  the  business,  product,
technology or company it acquires or, if  successful,  that any  acquisition  or
merger will result in the  appreciation of our  stockholders'  investment in our
common stock.


                                        6

<PAGE>



                         SHALLBETTER INDUSTRIES, INC.

                   Notes to Financial Statements - Continued


Note B - Going Concern Uncertainty - Continued

The  Company's  continued  existence is  dependent  upon its ability to generate
sufficient cash flows from operations to support its daily operations as well as
provide sufficient resources to retire existing liabilities and obligations on a
timely basis.

The Company  remains  dependent upon additional  external  sources of financing;
including being dependent upon its management and/or significant stockholders to
provide  sufficient  working capital.  The Company  anticipates  offering future
sales of equity securities. However, there is no assurance that the Company will
be able to obtain  additional  funding  through the sales of  additional  equity
securities  or,  that such  funding,  if  available,  will be  obtained on terms
favorable to or affordable by the Company.

It  is  the  intent  of  management  and  significant  stockholders  to  provide
sufficient  working  capital  necessary to support and preserve the integrity of
the corporate entity.  However, no formal commitments or arrangements to advance
or loan funds to the Company or repay any such advances or loans exist. There is
no legal obligation for either management or significant stockholders to provide
additional future funding.

In such a restricted cash flow scenario, the Company would be unable to complete
our  business  plan  steps,  and  would,  instead,   delay  all  cash  intensive
activities.  Without  necessary cash flow, the Company may become dormant during
the next twelve months, or until such time as necessary funds could be raised in
the equity securities market.

The Company has not conducted any business  operations or maintained  any assets
since 1982, has minimal cash on hand, no profit, is not currently engaged in any
merger or acquisition  negotiations and continues to seek an appropriate  merger
or acquisition candidate.  Because of these factors, our auditors have issued an
audit opinion for the Company which  includes a statement  describing  our going
concern status.  This means, in our auditor's  opinion,  substantial doubt about
our ability to continue as a going  concern  exists at the date of their  latest
audit opinion.

While the Company is of the opinion that good faith  estimates of the  Company's
ability to secure additional  capital in the future to reach our goals have been
made, there is no guarantee that the Company will receive  sufficient funding to
sustain operations or implement any future business plan steps.

NOTE C - Summary of Significant Accounting Policies

1.   Cash and cash equivalents

     The Company considers all cash on hand and in banks,  including accounts in
     book overdraft  positions,  certificates of deposit and other highly-liquid
     investments with maturities of three months or less, when purchased,  to be
     cash and cash equivalents.

2.   Income taxes

     The Company  utilizes  the asset and  liability  method of  accounting  for
     income  taxes.  At December  31, 2001 and 2000,  the deferred tax asset and
     deferred tax liability  accounts,  as recorded when material,  are entirely
     the  result  of  temporary  differences.  Temporary  differences  represent
     differences  in the  recognition  of  assets  and  liabilities  for tax and
     financial  reporting  purposes,   primarily  accumulated  depreciation  and
     amortization.  No valuation  allowance  was provided  against  deferred tax
     assets,  where  applicable.  As of December 31, 2001 and 2000, the deferred
     tax asset  related to the Company's net  operating  loss  carryforward  was
     fully reserved due to the unpredictability of ultimate realization.

                                        7

<PAGE>



                         SHALLBETTER INDUSTRIES, INC.

                   Notes to Financial Statements - Continued


NOTE B - Summary of Significant Accounting Policies - Continued

3.   Earnings (Loss) per share

     Basic  earnings  (loss) per share is computed  by  dividing  the net income
     (loss) by the weighted-average  number of shares of common stock and common
     stock  equivalents  (primarily  outstanding  options and warrants).  Common
     stock equivalents  represent the dilutive effect of the assumed exercise of
     the  outstanding  stock  options and  warrants,  using the  treasury  stock
     method.  The calculation of fully diluted earnings (loss) per share assumes
     the dilutive effect of the exercise of outstanding  options and warrants at
     either the  beginning  of the  respective  period  presented or the date of
     issuance,  whichever is later.  As of March 31, 2002 and 2001,  the Company
     has no warrants and/or options issued and outstanding.


NOTE C - Fair Value of Financial Instruments

The carrying amount of cash,  accounts  receivable,  accounts  payable and notes
payable, as applicable,  approximates fair value due to the short term nature of
these items  and/or the current  interest  rates  payable in relation to current
market conditions.


NOTE D - Seasonality of Operations

The  Company   experiences   fluctuations  in  quarterly   operating   expenses,
principally  professional  services for compliance with The Securities  Exchange
Act of 1934, which are charged to operations in the period in which the services
are incurred.


NOTE E - Advances from Officer

To support  operations  during  Calendar  2001,  the Company's  chief  executive
officer  made   non-interest   bearing  working  capital   advances  to  support
operations.  As of March 31, 2002,  the Company owes this officer  approximately
$6,600. These advances are repayable upon demand.




               (Remainder of this page left blank intentionally)









                                        8

<PAGE>



                         SHALLBETTER INDUSTRIES, INC.

                   Notes to Financial Statements - Continued


NOTE F - Income Taxes

The components of income tax (benefit)  expense for the three months ended March
31, 2002 and 2001, respectively, are as follows:
                                                            March 31,  March 31,
                                                              2002       2001
                                                            ---------  ---------
   Federal:
     Current                                                $       -  $       -
     Deferred                                                       -          -
                                                            ---------  ---------
                                                                    -          -
                                                            ---------  ---------
   State:
     Current                                                        -          -
     Deferred                                                       -          -
                                                            ---------  ---------
                                                                    -          -
                                                            ---------  ---------
   Total                                                    $       -  $       -
                                                            =========  =========

With  a  1999  change  of  control  of  the  Company,  all  net  operating  loss
carryforwards  incurred  prior to that  time were  negated  in  accordance  with
Section 382 of the Internal  Revenue Code. As of March 31, 2002, the Company has
a net operating  loss  carryforward  of  approximately  $19,000 to offset future
taxable income. Subject to current regulations,  this carryforward will begin to
expire  in  2020.  The  amount  and  availability  of  the  net  operating  loss
carryforwards  may be subject to limitations  set forth by the Internal  Revenue
Code. Factors such as the number of shares ultimately issued within a three year
look-back  period;  whether  there is a deemed  more than 50  percent  change in
control; the applicable long-term tax exempt bond rate; continuity of historical
business;  and  subsequent  income  of the  Company  all enter  into the  annual
computation of allowable annual utilization of the carryforwards.

The  Company's  income tax expense for the three months ended March 31, 2002 and
2001, respectively, are as follows:
                                                      Three months  Three months
                                                         ended         ended
                                                        March 31,     March 31,
                                                          2002          2001
                                                      ------------  ------------

Statutory rate applied to loss before income taxes    $      (805)  $      (520)
Increase (decrease) in income taxes resulting from:
    State income taxes                                          -             -
    Other, including reserve for deferred tax asset           805           520
                                                      ------------  ------------

      Income tax expense                              $         -   $         -
                                                      ============  ============



                                        9

<PAGE>



                         SHALLBETTER INDUSTRIES, INC.

                   Notes to Financial Statements - Continued


NOTE F - Income Taxes - Continued

Temporary  differences,  consisting primarily of statutory deferrals of expenses
for organizational costs and statutory  differences in the depreciable lives for
property and equipment, between the financial statement carrying amounts and tax
bases of assets and liabilities give rise to deferred tax assets and liabilities
as of March 31, 2002 and 2001, respectively:
                                                            March 31,  March 31,
                                                              2002       2001
                                                            ---------  ---------
Deferred tax assets
  Net operating loss carryforwards                          $  6,400   $  3,600
  Less valuation allowance                                    (6,400)    (3,600)
                                                            ---------  ---------

   Net Deferred Tax Asset                                   $      -   $      -
                                                            =========  =========

During the three  months  ended  March 31,  2002 and 2001,  the  reserve for the
deferred   current  tax  asset  increased  by   approximately   $800  and  $520,
respectively.


NOTE G - Common Stock Transactions

During  the  first  quarter  of  2001,   the  Company   performed  an  extensive
reconciliation  of its shareholder list in conjunction with the appointment of a
new stock  transfer  agent.  As a result  of this  reconciliation  process,  the
Company noted various clerical errors in its issued and outstanding  shares. The
net effect of this reconciliation process was to add 10,600 shares to the issued
and  outstanding  shares of the Company as of the first day of the first  period
presented.




               (Remainder of this page left blank intentionally)



                                       10

<PAGE>



Part I - Item 2

Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations

(1)Caution Regarding Forward-Looking Information

Certain  statements  contained  in  this  annual  filing,   including,   without
limitation, statements containing the words "believes", "anticipates", "expects"
and  words  of  similar  import,  constitute  forward-looking  statements.  Such
forward-looking  statements  involve known and unknown risks,  uncertainties and
other factors that may cause the actual results,  performance or achievements of
the Company,  or industry  results,  to be materially  different from any future
results,   performance   or   achievements   expressed   or   implied   by  such
forward-looking statements.

Such factors include, among others, the following:  international,  national and
local general economic and market conditions:  demographic  changes; the ability
of the Company to sustain,  manage or  forecast  its growth;  the ability of the
Company to successfully make and integrate acquisitions;  raw material costs and
availability;  new product  development and  introduction;  existing  government
regulations  and  changes  in,  or  the  failure  to  comply  with,   government
regulations;  adverse publicity;  competition; the loss of significant customers
or suppliers;  fluctuations  and  difficulty in forecasting  operating  results;
changes in business strategy or development  plans;  business  disruptions;  the
ability  to attract  and  retain  qualified  personnel;  the  ability to protect
technology; and other factors referenced in this and previous filings.

Given  these  uncertainties,  readers  of this Form  10-QSB  and  investors  are
cautioned not to place undue reliance on such  forward-looking  statements.  The
Company  disclaims  any  obligation  to update any such  factors or to  publicly
announce the result of any  revisions to any of the  forward-looking  statements
contained herein to reflect future events or developments.

(2)General

Shallbetter  Industries,  Inc. (Company) was initially incorporated on September
8, 1968 under the laws of the State of Minnesota.  The Company has not conducted
any  business  operations  or  maintained  any assets  since  1982.  The current
business purpose of the Company is to seek out and obtain a merger,  acquisition
or outright sale transaction  whereby the Company's  shareholders  will benefit.
The Company is not currently  engaged in any  negotiations and continues to seek
an appropriate merger or acquisition candidate.

(3)Results of Operations, Liquidity and Capital Resources and Plan of Operation

The Company had no revenue for the three month  periods ended March 31, 2002 and
2001, respectively.

General and  administrative  expenses  for the three months ended March 31, 2002
and 2001 were  approximately  $2,364 and $1,521,  respectively.  These  expenses
consisted primarily of legal and accounting expenses associated with maintaining
the corporate  status of the Company and compliance with the periodic  reporting
requirements of The Securities Exchange Act of 1934.

The  Company  realized a net loss of $2,364  and $1,521 for the three  months of
2002 and 2001, respectively.

The  Company  does not  expect  to  generate  any  meaningful  revenue  or incur
operating  expenses  unless and until it acquires  an  interest in an  operating
company.

At March 31, 2002,  the Company had available  cash of $74, a deficit in working
capital of $(8,885) and negative shareholders' equity of $(8,885). The available
cash is the result of  cumulative  working  capital  advances  of  approximately
$6,600  made to the Company by it's chief  executive  officer,  Craig  Laughlin.
These advances are non-interest bearing and are repayable upon demand.

The Company is currently  fully  dependent  either  future  sales of  securities
and/or advances or loans from significant  stockholders or corporate officers to
provide  sufficient  working  capital to preserve the integrity of the corporate
entity.

                                       11

<PAGE>


There is no assurance that the Company will be able to obtain additional funding
through the sales of additional  securities or, that such funding, if available,
will be obtained on terms favorable to or affordable by the Company.

It  is  the  intent  of  management  and  significant  stockholders  to  provide
sufficient  working  capital  necessary to support and preserve the integrity of
the  corporate  entity.  However,  there  is  no  legal  obligation  for  either
management or significant stockholders to provide additional future funding.

The  Company's  need for  capital  may change  dramatically  if it  acquires  an
interest  in a business  opportunity  during the next 12 months.  The  Company's
current  operating  plan  is to (i)  handle  the  administrative  and  reporting
requirements  of a public  company;  and (ii) search for  potential  businesses,
products,  technologies and companies for acquisition.  At present,  the Company
has no understandings, commitments or agreements with respect to the acquisition
of any  business,  product,  technology or company and there can be no assurance
that the Company will identify any such business, product, technology or company
suitable for acquisition in the future.  Further, there can be no assurance that
the Company would be successful in  consummating  any  acquisition  on favorable
terms  or that it will be able  to  profitably  manage  the  business,  product,
technology or company it acquires.


Part II - Other Information

Item 1 - Legal Proceedings:              None

Item 2 - Changes in Securities:          None

Item 3 - Defaults on Senior Securities:  None

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

     The Company has held no regularly scheduled,  called or special meetings of
     shareholders during the reporting period.

Item 5 - Other Information:   None

Item 6 - Exhibits and Reports on Form 8-K

     Exhibits - None
     Reports on Form 8-K - None

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


                                  SIGNATURES

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

                                                    Shallbetter Industries, Inc.


April   19  , 2002                                  /s/ Craig Laughlin.
      ------                                        ----------------------------
                                                                  Craig Laughlin
                                                          President and Director

                                       12