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

FORM 10-QSB

(Mark One)

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

For the quarterly period ended:    March 31, 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: 026597

DOT COM ENTERTAINMENT GROUP, INC.
                         (Exact name of small business issuer as specified in its charter)

Florida
(State or other jurisdiction of
incorporation or organization)

58-2466312
(I.R.S. Employer Identification Number)

150 Randall St.,
Oakville, Ontario, Canada
(Address of principal executive offices)

L6J 1P4
(zip code)

(905) 337-8524
Issuers telephone number

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

As of April 16, 2001, the registrant had 10,730,000 shares of
Common Stock outstanding.

Transitional Small Business Disclosure Format (check one);

Yes     NoX

This quarterly report contains forward-looking statements that involve substantial risks and
uncertainties. Any statement in this quarterly report and any documents
incorporated by reference into this quarterly report that is not a statement of
an historical fact constitutes a forward-looking statement within the meaning of
the Private Securities Litigation Reform Act of 1995. Further, when we use the
words may, expect, anticipate,
plan, believe, seek, estimate
and similar words, we intend to identify statements and expressions that may be
forward-looking statements. We believe it is important to communicate certain of
our expectations to our investors. Forward-looking statements are not guarantees
of future performance. They involve risks, uncertainties and assumptions that
could cause dot coms future results to differ materially from those
expressed in any forward-looking statements. Many factors are beyond our ability
to control or predict. You are accordingly cautioned not to place undue reliance
on such forward-looking statements. We have no obligation or intent to update
publicly any forward-looking statements whether in response to new information,
future events or otherwise. Important factors that may cause our actual results
to differ from such forward-looking statements include, but are not limited to,
the risk factors discussed below under Item 2 MANAGEMENTS DISCUSSION
AND ANALYSIS OR PLAN OF OPERATION -- RISKS AND UNCERTAINTIES and
in dot coms Annual Report on Form 10-KSB.

Part I - Financial Information

Item 1. - Financial Statements

dot com ENTERTAINMENT GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

`(Unaudited)
                                                    March 31,       December 31,
                                                      2001             2000
                                                    ---------       -----------
        ASSETS

Current assets:
     Cash and cash equivalents                    $  819,973        $  655,409
     Accounts receivable:
         Trade                                       569,638           464,061
         Other                                        23,660            16,274
     Prepaid expenses and other deposits              16,708                 -
                                                  ----------        ----------
              Total current assets                 1,427,979         1,135,744

Fixed assets - net                                    45,567            46,418
Deferred tax asset                                   203,500           260,000
                                                  ----------        ----------
                                                  $1,677,046        $1,442,162
                                                  ==========        ==========

         LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
     Accounts payable and accrued expenses        $  165,349        $  105,521
     Accounts payable - officers                      66,000            75,805
     Deferred revenue                                177,942           164,167
     Income taxes payable                             42,866            15,532
                                                  ----------        ----------
              Total current liabilities              452,157           361,025

Stockholders' equity:
     Common stock, $0.001 par value, 50,000,000
     shares authorized, 10,730,000 shares issued
     and outstanding (10,730,000 - 2000)              10,730            10,730
     Additional paid in capital                    1,411,820         1,411,820
     Accumulated deficit                            (197,661)         (341,413)
                                                  ----------        ----------
                                                   1,224,889         1,081,137
                                                  ----------        ----------
                                                  $1,677,046        $1,442,162
                                                  ==========        ==========`

(see accompanying notes)

dot com ENTERTAINMENT  GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

`Three Months Ended March 31,
                                                       2001              2000
                                                       ----              ----
Revenues:
     Royalties                                      $ 560,553      $   221,910
     Installation fees                                159,225           17,000
     Support and maintenance                           85,058           67,000
                                                     --------       ----------
                                                      804,836          305,910
Expenses:
     Marketing                                        146,372           33,879
     Research, software development and
        support services                              192,696          132,271
     General and administrative                       226,182           98,365
                                                   ----------       ----------
                                                      565,250          264,515
                                                   ----------       ----------
Net income before income tax expense                  239,586           41,395
Income tax expense                                     95,834           17,000
                                                   ----------       ----------
Net income                                         $  143,752      $    24,395
                                                   ==========       ==========
Net income per share:

     Basic                                         $     0.01      $      0.00
                                                   ==========       ==========
     Diluted                                       $     0.01      $      0.00
                                                   ==========       ==========
Weighted average number of common
  shares outstanding:

     Basic                                         10,730,000       10,653,000
                                                   ==========       ==========
     Diluted                                       10,811,023       10,653,000
                                                   ==========       ==========`

(see accompanying notes)

dot com ENTERTAINMENT  GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

`Three Months Ended March 31,
                                                      2001              2000
                                                      ----              ----
Cash flows from operating activities:

     Net income                                     $ 143,752        $  24,395
     Adjustments to reconcile net income to
      net cash provided (used) by operating activities:
         Expenses satisfied via the issuance of
         common stock and stock options                     -           18,000
         Depreciation                                   3,590                -
         Deferred income tax expense                   56,500           17,000
         Changes in non-cash working capital items:
             Accounts receivable                     (112,963)         (69,258)
             Prepaid expenses and deposits            (16,708)               -
             Accounts payable and accrued expenses     59,828           39,194
             Accounts payable - officers               (9,805)         (31,416)
             Deferred revenue                          13,775                -
             Income taxes payable                      27,334                -
                                                     --------          -------
Net cash provided (used) by operating activities     165,303           (2,085)

Cash flows from investing activities:

     Purchases of fixed assets                         (2,739)               -
                                                     --------          -------

Net cash used in investing activities                  (2,739)               -

Cash flows from financing activities:

     Proceeds from issuance of common stock                -           455,000
                                                    ---------         --------
         Net cash provided by financing activities         -           455,000
                                                    ---------         --------

Net increase in cash and cash equivalents
  during the period                                   162,564          452,915

Cash and cash equivalents beginning of period         655,409           51,707
                                                    ---------         --------
Cash and cash equivalents, end of period            $ 817,973         $504,622
                                                    =========         ========
Supplemental cash flow activities
      Income taxes paid                             $  12,000         $      -
                                                    =========         ========`

(see accompanying notes)

NOTES TO FINANCIAL STATEMENTS

NOTE 1. - BASIS OF PRESENTATION

The accompanying unaudited financial statements of dot com Entertainment Group, Inc.
and Subsidiaries (the Company) have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Form 10-QSB. Accordingly, they do not include all of
the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary for a
fair presentation have been included. Operating results for the three month
period ended March 31, 2001 are not necessarily indicative of the results that
may be expected for the year ended December 31, 2001. For further information,
refer to the Companys Annual Report on Form 10-KSB for the year ended
December 31, 2000, which includes audited financial statements and footnotes as
of and for the years ended December 31, 2000 and 1999.

NOTE 2. - STOCK OPTIONS

During the quarter ended March 31, 2001, the Company granted 977,500 options to
directors and employees of the Company to purchase common stock of the Company
at an exercise price of $0.75 which will be accounted for under APB 25.
Accordingly, no compensation expense will be recognized in the statement of
operations, since the option price was greater or equal to the market value of
the Companys common stock at the time of grant.

NOTE 3. - EARNINGS PER SHARE

In  accordance  with  Statement of Financial  Accounting  Standards  No. 128,  "Earnings  Per Share," the
Company has reported basic earnings per share and diluted earnings per share. The diluted weighted average
common shares outstanding include the impact of the assumed exercise of
1,947,500 stock options with an exercise price of $0.75. The amount was
determined using the treasury stock method. All other securities, consisting of
1,620,000 stock options and 200,000 warrants with exercise prices ranging from
$2.50 to $4.00, are anti-dilutive and have not been included in the calculation.

NOTE 4. - RECLASSIFICATIONS

Certain  amounts in the 2000 financial  statements  have been  reclassified  to conform with the 2001  financial  statement
presentations.

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

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

General

dot com Entertainment Group, Inc. ("dot com" or the "Company") is an Internet software development company specializing in the
creation and support of Internet gaming products and related services.

The Company derives its revenues from several sources, including its assessment of installation fees and
royalties from the use of its software. Additionally, dot com generates revenue
by providing licensees with technical support, maintenance, software upgrades,
e-digital and systems consulting services.

dot com is not an Internet gaming company, in that it does not directly or indirectly accept wagers used to
play games of chance on the Internet. Rather, it develops and licenses the use
of its commercial software products and trademarks to independent third parties
located in jurisdictions where Internet gaming is regulated or tolerated.

The following tables set forth selected information from the statements of operations for the three
months ended March 31, 2001 and 2000 and the balance sheets as at March 31, 2001
and December 31, 2000.

`Selected Statement of Operations Information

                                            Three Months Ended March 31,
                                            2001                   2000
                                            ----                   ----
Revenues                              $    804,836              $  305,910
Operating expenses                         565,250                 264,515
Net income                                 143,752                  24,395

Selected Balance Sheet Information

                                          March 31,              December 31,
                                            2001                     2000
                                            ----                     ----

Current assets                          $1,427,979                $ 1,135,744
Current liabilities                        452,157                    361,025
Stockholders' equity                     1,224,889                  1,181,137`

Review of the three months ended March 31, 2001 compared with the three months ended March 31, 2000.  Revenues increased to $804,836 for the quarter ended March 31, 2001 from
$305,910 for the quarter ended March 31, 2000. The growth in revenues results
primarily from higher royalties and installation fees. The royalty revenue
increased to $560,553 for the 2001 quarter from $221,910 for the 2000 quarter
reflecting the increased activity of the Companys licensees. Installation
fees were $159,225 representing fees recognized on the delivery of the
Companys software to eight new licensees during the quarter ended March
31, 2001. It is anticipated that the Company will begin to derive royalty
revenue from these new licensees in the second quarter of 2001. Installation
fees were $17,000 for the similar period in 2000. Support and maintenance
revenue was $85,058 for the quarter ended March 31, 2001 resulting from
continued development and delivery of software enhancements, e-digital services
and providing marketing and promotional programs to our customers. In 2000,
support and maintenance revenue was $67,000. To date, in fiscal 2001, the
Company has entered into eight new license agreements, with delivery of the
Companys software due for three of these licensees in the second quarter
of 2001. The additional licensees are expected to continue to diversify the
Companys sources of revenue for the remainder of fiscal year 2001. During
the three months ended March 31, 2001, 76.8% (100.0% - 2000) of the
Companys revenue was provided by one customer. The loss of this customer
or its bankruptcy could have a material negative impact on the Companys
revenues and profit. This customer also represents 82.4% of the trade accounts
receivable at March 31, 2001 (94% at December 31, 2000). If the customer became
insolvent and could not pay the balances owing to the Company, it would have a
significant impact on the cash flows and profitability of the Company.

Operating expenses increased to $565,250 for the quarter ended March 31, 2001 from $264,515 for the
same quarter in 2000. The increased operating expenses reflect the significantly
higher level of activity at the Company, including increased staffing of
approximately 25 employees over the prior year. Marketing expenses were $146,372
for the first quarter of 2001 compared to $33,879 for the first quarter in 2000.
The increase reflects the Companys enhancement of its e-digital division,
and the allocation of additional resources to marketing, selling and front end
product development to provide our licensees with customization services.
Development expenses grew to $192,696 for the three months ended March 31, 2001
from $132,271 for the same quarter in 2000. The increase in development expenses
results from the hiring of software developers to improve and diversify the
Companys products and services. General and administrative expenses
increased to $226,182 for the quarter ended March 31, 2001 from $98,365 for the
similar period in the prior year. The increase primarily results from the
increased remuneration of its senior management, the leasing of larger office
space, professional fees, and the incurrence of the related expenses associated
with the higher level of activity of the Company.

The Company had a net profit of $143,752 for the three months ended March 31, 2001 compared to $24,395
for the same quarter in 2000. As the Company increases the number of its
licensees and introduces new products it is anticipated that profitability will
continue to improve. There was a $95,834 tax provision recorded for the first
quarter of 2001 based on the profits for the period as compared to $17,000 in
the prior year period.

LIQUIDITY AND CAPITAL RESOURCES

At March 31, 2001, the Company had cash and cash equivalents of $817,973 as compared with $655,409 at
December 31, 2000.

At March 31, 2001, the Company had working capital of $975,822 as compared with $774,719 at December
31, 2000. The increase primarily reflects higher cash and cash equival ents
balances from cash derived from operating results. The Company intends to use
these funds to further develop its current products, create and develop new
products and to expand its sales and marketing efforts to increase the number of
licensees of its products. Also contributing to the improvement in working
capital is a higher balance of accounts receivable offset marginally by a higher
balance of accounts payable. The increase in accounts receivable reflects the
higher revenue activity of the Company as well as certain amounts due to the
Company for software installations made in the first quarter of 2001.

At March 31, 2001, total assets increased to $1,677,046 from $1,442,162 at December 31, 2000. The
increase is due primarily to the higher levels of cash and accounts receivable
as discussed above.

Total liabilities increased to $452,157 at March 31, 2001 from $361,025 at December 31, 2000. The increase
is partially related to the increase in deferred revenue resulting from the
receipt of deposits for installation fees from new licensees. The Companys
revenue recognition policy for installation fees requires the delivery and
installation of the Companys software and a determination that the
collection of the fee from the licensee is probable. The remainder of the
increase relates to higher taxes payable resulting from the profitability during
the quarter and increased accounts payable related to the higher level of
activity of the Company.

Net cash provided by operating activities was $165,303 for the three months ended March 31, 2001.
This compares to a use of cash from operations of $2,085 for the same quarter in
the prior year. The improvement results primarily from the higher net income
that was earned in the current quarter.

In March 2000 dot com received proceeds of approximately $455,000, net of related costs of $45,000
through the sale of units pursuant to a private placement made in accordance
with Regulation S of the Securities Act. Most of these funds have been invested
in money market funds since March 2000. The Company has not sold any securities
in the current year.

The Company has a line of credit with the Companys bank in Canada, The Toronto Dominion Bank. The
Company has a $CDN 161,000 line of credit at bank prime plus 1⁄4 % and a
$U.S. 50,000 line of credit at the banks U.S. prime rate plus 1⁄4 %.
Both lines are secured with balances in money market funds and were not utilized
as at March 31, 2001.

Management believes that the Company will have sufficient resources to support its growth through
continued revenue improvements, the collection of its trade accounts receivable
in the ordinary course of business and by continuing to monitor its expenses in
light of the cash resources of the Company, but there can be no assurance that
managements plans can be met.

There are presently no material commitments for capital expenditures. Due to the nature of its
business, the Company does not require significant outlays for capital
expenditures and, as a result, is not planning for any material capital
expenditures for the foreseeable future.

RISKS AND UNCERTAINTIES

The Company has identified that there is uncertainty in North America relating to the lawfulness of
Internet gaming. As such, notwithstanding the fact that its licensees operate
from countries where such business is lawful if licensed, governments elsewhere,
including the federal, state or any local governments in the United States may
take the position that the Companys software and support systems are being
played and or used unlawfully in their jurisdiction. Accordingly, the Company
may face criminal prosecution in any number of jurisdictions for aiding and
abetting others, such as its licensees, in operating an illegal gaming
operation. The Company has devoted only limited resources to investigating the
legal climate in which it operates. Many of the issues facing the Company are
the same as those facing all other e-commerce and other Internet software
providers and traditional software providers, as current laws are not clear as
to who, if anyone, has jurisdiction over Internet-based commerce. A number of
bills have been introduced in the United States House of Representatives to
expressly ban Internet gaming. One of these proposals was recently defeated.
Although the Company intends to do business worldwide, any enforceable ban on
Internet gaming in the United States would have a material adverse effect on the
Companys business and both its short-term and long-term liquidity and its
revenues from operations.

IMPACT OF INFLATION

The Company believes that inflation has not had a material effect on its business.

Part II - Other Information

Item 6 - Exhibits and Reports on Form 8-K



| | (a)  Exhibits.

      None.

(b)  Reports on Form 8-K.
      None.
| | ------------------------------------------------------------------

SIGNATURES

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

DOT COM ENTERTAINMENT GROUP, INC.
(Registrant)



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