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

                                    FORM 10-Q

(Mark One)
[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 Period from            to
                                               ----------    ----------

                         Commission File Number: 0-6333

                            HYDRON TECHNOLOGIES, INC.
             (Exact name of Registrant as specified in its charter)


New York                                                  13-1574215
-------------------------------                           ----------------
(State or other jurisdiction of                           (I.R.S. Employer
incorporation or organization)                            Identification No.)


1001 Yamato Road, Suite 403, Boca Raton, Florida          33431
------------------------------------------------          ----------
(Address of principal executive offices)                  (Zip Code)


       Registrant's telephone number, including area code: (561) 994-6191


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 [ ] No [X]

Number of shares of common stock outstanding as of August 1, 2001: 4,975,136

<PAGE>

                   HYDRON TECHNOLOGIES, INC. AND SUBSIDIARIES

                                      Index

                                                                            Page
                                                                            ----
Part I. Financial Information
-----------------------------

Item 1. Financial Statements (Unaudited)

   Condensed consolidated balance sheets-- June 30, 2001 and
   December 31, 2000                                                          3

   Condensed consolidated statements of operations -- Three months
   and six months ended June 30, 2001 and 2000                                4

   Condensed consolidated statements of cash flows -- Six months
   ended June 30, 2001 and 2000                                               5

   Notes to condensed consolidated financial statements --
   June 30, 2001                                                              6

Item 2. Management's Discussion and Analysis of Financial Condition
        and Results of Operations                                            10


Part II. Other Information
--------------------------

Item 1. Legal Proceedings                                                    15

Item 6. Exhibits and Reports on Form 8-K                                     15


Signatures                                                                   16

                                       2
<PAGE>

                   HYDRON TECHNOLOGIES, INC. AND SUBSIDIARIES

                      Condensed Consolidated Balance Sheets
<TABLE>
<CAPTION>

                                                            June 30,      December 31,
                                                              2001            2000
                                                          ------------    ------------
                                                           (Unaudited)       (Note)
<S>                                                       <C>             <C>
ASSETS

Current Assets
     Cash and cash equivalents                            $    596,146    $    190,946
     Trade accounts receivable                                  63,159         136,306
     Inventories                                             1,379,510       1,489,396
     Prepaid expenses and other current assets                  13,373          39,619
                                                          ------------    ------------
                                  Total current assets       2,052,188       1,856,267

Property and equipment, less accumulated
         depreciation of $986,732 and $931,232 at
         2001 and 2000, respectively                            55,502         111,002
Deposits                                                        15,234          60,403
Deferred product costs, less accumulated
         amortization of $5,338,652 and $5,194,952 at
         2001 and 2000, respectively                           629,143         772,843

                                                          ------------    ------------
                                  Total Assets            $  2,752,067    $  2,800,515
                                                          ============    ============


LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities
     Accounts payable                                     $    163,672    $    194,791
     Customer deposits                                         306,600              --
     Accrued liabilities                                       494,261         464,084
                                                          ------------    ------------
         Total current liabilities                             964,533         658,875

Commitments and contingencies                                       --              --

Shareholders' equity
     Common stock - $.01 par value
         30,000,000 shares authorized; 5,035,336 shares
         issued; and 4,975,136 shares outstanding               50,353          50,353
     Additional paid-in capital                             19,501,837      19,501,837
     Accumulated deficit                                   (17,325,498)    (16,971,392)
     Treasury stock, at cost; 60,200 shares                   (439,158)       (439,158)
                                                          ------------    ------------
         Total Shareholders' equity                          1,787,534       2,141,640

                                                          ------------    ------------
         Total liabilities and shareholders equity        $  2,752,067    $  2,800,515
                                                          ============    ============
</TABLE>

Note:    The balance sheet at December 31. 2000 has been derived from the
         audited financial statements at that date but does not include all of
         the information and footnotes required by generally accepted accounting
         principles for complete financial statements.

            See notes to condensed consolidated financial statements.

                                       3
<PAGE>
<TABLE>
<CAPTION>
                            HYDRON TECHNOLOGIES, INC. AND SUBSIDIARIES

                         Condensed Consolidated Statements of Operations
                                           (Unaudited)


                                         Three months ended June 30     Six months ended June 30
                                         --------------------------    --------------------------
                                             2001           2000           2001           2000
                                         -----------    -----------    -----------    -----------
<S>                                      <C>            <C>            <C>            <C>
Net Sales                                $   517,157    $   607,862    $   846,850    $ 1,280,252
Cost of sales                                142,433        222,199        198,041        438,514
                                         -----------    -----------    -----------    -----------
Gross profits                                374,724        385,663        648,809        841,738

Expenses
     Royalty expense                          26,574         30,000         43,058         63,953
     Research and development                 24,764         21,859         40,143         40,009
     Selling, general & administration       360,470        506,908        725,070        954,209
     Depreciation & amortization              99,600        111,300        199,200        222,600
                                         -----------    -----------    -----------    -----------
         Total expenses                      511,408        670,067      1,007,471      1,280,771

                                         -----------    -----------    -----------    -----------
Operating loss                              (136,684)      (284,404)      (358,662)      (439,033)

Interest income                                2,742          5,674          4,556         11,850
                                         -----------    -----------    -----------    -----------
         Loss before income taxes           (133,942)      (278,730)      (354,106)      (427,183)

Income taxes expense                              --             --             --             --
                                         -----------    -----------    -----------    -----------
         Net loss                        $  (133,942)   $  (278,730)   $  (354,106)   $  (427,183)
                                         ===========    ===========    ===========    ===========

Basic and diluted loss per share
     Net loss per common share           $     (0.03)   $     (0.06)   $     (0.07)   $     (0.09)
                                         ===========    ===========    ===========    ===========
</TABLE>

            See notes to condensed consolidated financial statements.

                                       4
<PAGE>
<TABLE>
<CAPTION>

                        HYDRON TECHNOLOGIES, INC. AND SUBSIDIARIES

                     Condensed Consolidated Statements of Cash Flows
                                       (Unaudited)

                                                                 Six months ended June 30
                                                                 ------------------------
                                                                    2001          2000
                                                                 ----------    ----------
<S>                                                              <C>           <C>
Operating Activities

Net Loss                                                         $ (354,106)   $ (427,183)
     Adjustments to reconcile net loss to
      Net Cash used by operating activities
          Depreciation and amortization                             199,200       222,600

     Change in operating assets and liabilities
          Trade accounts receivables                                 73,147      (160,887)
          Inventories                                               109,886      (108,271)
          Prepaid expenses and other current assets                  26,246        13,428
          Deposits                                                   45,169        88,685
          Accounts payable                                          (31,119)       23,151
          Customer deposits                                         306,600            --
          Accrued liabilities                                        30,177        (4,137)
                                                                 ----------    ----------
     Net cash provided (used) by operating activities               405,200      (352,614)


Investing activities
          Net cash provided (used) by investing activities               --           536


Financing activities
     Net cash provided (used) by financing activities                    --            --


                                                                 ----------    ----------
          Net increase (decrease) in cash and cash equivalents      405,200      (353,150)

Cash and cash equivalents at beginning of period                    190,946       653,916

                                                                 ----------    ----------
Cash and cash equivalents at end of period                       $  596,146    $  300,766
                                                                 ==========    ==========
</TABLE>

                See notes to condensed consolidated financial statements.

                                            5
<PAGE>

                   HYDRON TECHNOLOGIES, INC. AND SUBSIDIARIES

              Notes to Condensed Consolidated Financial Statements
                                   (Unaudited)

                                  June 30, 2001

Note A - Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X. 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 of Hydron Technologies, Inc.
(the "Company"), all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. Operating
results for the three and six month periods ended June 30, 2001 are not
necessarily indicative of the results that may be expected for the year ending
December 31, 2001. For further information, refer to the consolidated financial
statements and footnotes thereto included in the Company's Annual Report on Form
10-K for the year ended December 31, 2000.


Note B - Inventories

Inventories consist of the following:
                                           June 30, 2001      December 31, 2000

Finished goods                              $   889,625          $   869,082
Raw materials and components                    489,885              620,314
                                            -----------          -----------
                                            $ 1,379,510          $ 1,489,396
                                            ===========          ===========

Note C - Distribution

- Catalog Sales

In November 1996, Hydron Technologies, Inc. (the Company) opened a new channel
of distribution for Hydron products with the launch of its proprietary Catalog.
The Catalog provides information on new Hydron products, educates consumers on
proper skin and hair care and facilitates re-ordering. The orders are taken by
phone, mail and through the Company's redesigned Hydron website
(www.hydron.com).

- Direct Response Television

Effective September 1, 1999, the Company entered into a marketing and
distribution agreement (the "Home Shopping Agreement") with HSN that grants HSN
an exclusive worldwide license to

                                       6
<PAGE>

                   HYDRON TECHNOLOGIES, INC. AND SUBSIDIARIES

                   Notes to Consolidated Financial Statements
                                   (Unaudited)

                                  June 30, 2001


Note C - Distribution (continued)

market and distribute certain of the Company's proprietary consumer products
through various forms of electronic retailing. The Home Shopping Agreement also
grants HSN a non-exclusive license to market Hydron products through all other
methods of distribution in certain countries outside the United States.

The Company launched its products on HSN's television network on September 16,
1999. Hydron products have since been featured in "Hydron Skin Care Solutions"
hours during 7 of the first 12 months of the Home Shopping Agreement. While HSN
has not met its purchase commitment for the first 12 months and Hydron has not
been on the domestic network since August of 2000, Management is continuing to
work with HSN to re-establish Hydron's presence through their domestic network
in 2001.

In November 2000 the Company also began marketing on HSE, the Spanish language
subsidiary of HSN. Hydron has secured a two-year agreement with Home Shopping
Espanol (HSE), a rapidly expanding division of Home Shopping, L.P., to air
Hydron products on HSE's Spanish-language television shopping programming in the
Untied States and internationally. The Company is currently working with HSE to
include its Spanish language show in the United States, Puerto Rico and Mexico.
It is anticipated HSE will eventually expand to additional Latin American and
South American markets.

Although Management believes that there are other avenues for selling its
products, including the Hydron catalog, the loss of HSN as a customer would have
a material adverse effect on the Company's business. Sales through television
retailers were 24% and 59% of the Company sales during the six months ended June
30, 2001 and 2000, respectively.

The Company entered into a license agreement with QVC, Inc. in 1993 ("QVC
License Agreement"), whereby QVC was granted exclusive rights to market and
distribute the Company's proprietary consumer products using Hydron polymers in
the Western Hemisphere. In 1996, the Company and QVC modified the QVC License
Agreement ("Amended License Agreement"), whereby the Company reacquired certain
retail marketing rights to the Hydron product line. Effective May 31, 1999, the
Company terminated the Renegotiated License Agreement as a result of QVC's
failure to satisfy the annual minimum product purchase requirements for the
period ended May 31, 1999.

The Company continues to sell certain products to QVC, on a non-exclusive basis,
so that QVC can resell these products to their customers who had previously
purchased the products and wish to re-order Hydron products.

                                       7
<PAGE>

                   HYDRON TECHNOLOGIES, INC. AND SUBSIDIARIES

                   Notes to Consolidated Financial Statements
                                   (Unaudited)

                                  June 30, 2001


Note C - Distribution (continued)

- Private Label Contracting

In March 2001 the Company signed a contract with a U.S. corporation to provide
exclusive skin care products based on Hydron's patented formula technology. The
product launch will include, facial moisturizers, skin treatment products and
related prestige quality formulas. The contract has escalating minimums over
three years to maintain exclusivity.

- International

The majority of the Company's products are currently sold in the United States.
The Company entered an agreement in 1995 with an Australian-based health and
beauty products distributor, Doctors Formula Pty. Ltd., to market Hydron
products in retail salon stores and medical offices in Australia and New
Zealand. The Company entered into a distribution agreement with a distributor in
Taiwan in April. The first shipment to Taiwan was in May. The Company also
distributes dental products into Spain and, to a lesser extent, other countries.
Although this category is not significant at this time, it represents the
foundation for future growth in a new channel of distribution.

                                       8
<PAGE>

                   HYDRON TECHNOLOGIES, INC. AND SUBSIDIARIES

                   Notes to Consolidated Financial Statements
                                   (Unaudited)

                                  June 30, 2001


Note D - Earnings Per Share

The following table sets forth the computation of basic and diluted loss per
share:
<TABLE>
<CAPTION>

                                                 Three Months Ended June 30,    Six Months Ended June 30,
                                                 --------------------------    --------------------------
                                                     2001           2000           2001           2000
                                                 -----------    -----------    -----------    -----------
<S>                                              <C>            <C>            <C>            <C>
Numerator:
  Net loss is both the numerator for basic
    loss per share (income available to
    common shareholders) and the numerator
    for diluted loss per share (income
    available to common shareholders
    after assumed conversions)                   $  (133,942)   $  (278,730)   $  (354,106)   $  (427,183)
                                                 ===========    ===========    ===========    ===========

Denominator:
  Denominator for basic loss per share
    (weighted-average shares)                      4,975,136      4,975,136      4,975,136      4,975,136
  Effect of dilutive securities: Stock options
    and warrants                                          --             --             --             --
                                                 -----------    -----------    -----------    -----------
  Denominator for dilutive loss per
    share (adjusted weighted-average)              4,975,136      4,975,136      4,975,136      4,975,136
                                                 ===========    ===========    ===========    ===========

Basic loss per share                             $      (.03)   $      (.06)   $     (0.07)   $     (0.09)
                                                 ===========    ===========    ===========    ===========

Diluted loss per share                           $      (.03)   $      (.06)   $     (0.07)   $     (0.09)
                                                 ===========    ===========    ===========    ===========
</TABLE>

Options and warrants to purchase 620,500 shares of common stock were outstanding
at June 30, 2001, but were not included in the computation of diluted earnings
per share because the effect would be anti-dilutive to the net loss per share
for the period.

                                       9
<PAGE>

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

Business
--------

Hydron Technologies, Inc. markets a broad range of consumer and oral health care
products using a moisture-attracting ingredient (the "Hydron(R) polymers"), and
owns a non-prescription drug delivery system for topically applied
pharmaceuticals, which uses such polymer. The Company holds U.S. and
international patents on what Management believes is the only known cosmetically
acceptable method to suspend the Hydron polymer in a stable emulsion for use in
personal care/cosmetic products. The Company has concentrated its sales and
development activities primarily on the application of these biocompatible,
hydrophilic polymers in various personal care/cosmetic products for consumers
and, to a lesser extent, oral-care products for dental professionals. The
Company entered into a license agreement for supply of the polymer with National
Patent Development Corp. ("National Patent"), which provides for reciprocal
royalty payments based on the sale of certain of each party's products. The
Company currently has thirty-nine individual products available (excluding shade
variations) in the following product lines: skin care (22 products), hair care
(7 products), bath and body (8 products) and sun care (2 products). Of the
Company's products, nine are Over-The-Counter (OTC) drug products.

The Company is developing other cosmetic/personal care and OTC drug products for
consumers using Hydron polymers. The Company intends to continue to explore
using its technology as a topical drug delivery system and would, when
appropriate, either seek licensing arrangements with third parties, or develop
and market proprietary products through its own efforts.

The Company is also researching and developing new technology-based and possibly
patentable skin treatment systems that would augment its product line. When
appropriate, The Company may license existing technology to secure exclusive
marketing rights.

Management believes that the Company's Hydron product lines are unique and offer
the following competitive benefits: the moisturizers self-adjust to match the
skin's optimal pH balance soon after they are applied to the skin; they become
water-insoluble on the skin's surface, and unlike all other water-based cremes
and lotions, are not removed by the skin's perspiration or plain water; they are
oxygen-permeable and leave no greasy after-feel; they do not emulsify the skin's
natural moisturizing agents, as do conventional cremes and lotions; and they
attract and hold water, creating a cushion of moisture on the skin's surface
that promotes penetration of other beneficial product ingredients. The Company's
products are dermatologist tested and approved for all skin types. Products for
use around the eye area are also ophthalmologist tested and safe for contact
lens wearers. Most of the Company's moisturizing products are based on the
Company's patented emulsion system, which permits the product ingredients to
deliver their intended benefits over an extended period of time and in a more
efficient manner.

Hydron products had been marketed on QVC through regularly scheduled hour-long
programs from April 1994 through May 1999 under licensing agreement. The Company
continues to sell certain products to QVC, on a non-exclusive basis, so that QVC
can resell these products to their customers who had previously purchased the
products and wish to re-order Hydron products.

                                       10
<PAGE>

Business (continued)
--------------------

Effective September 1, 1999, the Company entered into a marketing and
distribution agreement (the "Home Shopping Agreement") with HSN that grants HSN
an exclusive worldwide license to market and distribute certain of the Company's
proprietary consumer products through various forms of electronic retailing. The
Home Shopping Agreement also grants HSN a non-exclusive license to market Hydron
products through all other methods of distribution in certain countries outside
the United States.

The Company launched its products on HSN's domestic television network on
September 16, 1999. While HSN has not met its purchase commitment for the first
12 months, Management is continuing to work with HSN to increase sales through
their network in 2001.

In November 2000 the Company began marketing on HSE, the Spanish language
subsidiary of HSN. Hydron has secured a two-year agreement with Home Shopping
Espanol (HSE), a rapidly expanding division of Home Shopping, L.P., to air
Hydron products on HSE's Spanish-language television shopping programming in the
Untied States and internationally. Hydron has retained Charytin Goyco, a
well-known Latin celebrity, as Spokesperson for the Latin American Market for
the same two-year period. The HSE program has already expanded beyond the US
border to include Puerto Rico and Mexico. . It is anticipated HSE will
eventually expand to additional Latin American and South American markets.

In November 1996, the Company opened a new channel of distribution for Hydron
products with the launch of its proprietary Catalog. This full color Catalog
offers the Company's personal care products for sale directly to consumers. The
Catalog also provides information on new Hydron products, educates consumers on
proper skin and hair care and facilitates re-ordering. Catalog sales also
include sales of products from the Hydron website (www.hydron.com) which was
redesigned and re-launched in January 2001. The Company is currently exploring
new ways to enhance Catalog sales and operations.

In March 2001, the Company announced that it signed a contract to provide a
major international multilevel marketing corporation with exclusive skin care
products based on Hydron's patented formula technology. The product line will
include facial moisturizers, skin treatment products and related prestige
quality formulas. The contract has escalating minimums totaling $1.5 million
over three years to maintain exclusivity. The first order has been received with
the initial shipments have been made in August 2001.

Internationally, the Company entered an agreement in 1995 with an
Australian-based health and beauty products distributor, Doctors Formula Pty.
Ltd., to market Hydron products in retail salon stores and medical offices in
Australia and New Zealand. The Company entered into a distribution agreement
with a distributor in Taiwan in April. The first shipment to Taiwan was in May.
The Company also distributes dental products into Spain and, to a lesser extent,
other countries.

The majority of Hydron products are now sold in connection with direct
marketing. Although Management believes that there is significant growth
potential in other avenues for selling the Company's products, the loss of HSN
as a customer would have a material adverse effect on the Company's business.

                                       11
<PAGE>

The Company has not decided what actions, if any, it plans to take under such
circumstances.

Results of Operations
---------------------

Net sales for the three months ended June 30, 2001 were $517,157, a decrease of
$90,705, or 15%, from net sales of $607,862 for the three months ended June 30,
2000. Net sales for the six months ended June 30, 2001 were $846,850, a decrease
of $433,402, or 34%, from net sales of $1,280,252 for the six months ended June
30, 2000.

Catalog net sales for the three months ended June 30, 2001 were $332,589, an
increase of $42,977, or 15%, from catalog net sales of $289,612 for the three
months ended June 30, 2000. Catalog net sales for the six months ended June 30,
2001 were $638,273, an increase of $119,080, or 23% from catalog net sales of
$519,193 for the six months ended June 30, 2000. The increase in catalog sales
for the three months ended June 30, 2000 was the result of targeted promotional
activities. The increase in catalog sales for the six months ended June 30, 2000
was the result of an overall strategic effort to improve catalog activity to
current customers and to bring in new customers.

Non-catalog net sales, including HSN and QVC, for the three months ended June
30, 2001 were $184,568, a decrease of $133,682, or 42%, from non-catalog net
sales of $318,250 for the three months ended June 30, 2000. Non-catalog net
sales for the six months ended June 30, 2001 were $208,577, a decrease of
$552,482, or 73%, from non-catalog net sales of $761,058 for the six months
ended June 30, 2000. The decrease in non-catalog sales resulted primarily from
lower net sales to HSN. The Company is working with HSN to rectify this
situation for the balance of 2001. QVC sales were also below a year ago
reflecting an anticipated steady volume decline as Hydron has not been actively
marketed to the QVC's customers since May 1999.

Approximately 35% of the Company's sales for the three months ended June 30,
2001, were from HSN and QVC, down from 52% for the three months ending June 30,
2000. Approximately 24% and 59% of the Company's sales during the six months
ended June 30, 2001 and 2000, respectively, were to HSN and QVC. Management
anticipates that television sales will continue to be a smaller percentage of
the Company's sales and, absent the consummation of marketing or distribution
arrangements with third parties other than HSN, the Company's dependence upon
direct response television as a distribution channel will be reduced.

The Company's overall gross profit margin for the three months ended June 30,
2001 was 73%, as compared to 63% for the three months ended June 30, 2000. The
Company's overall gross profit margin for the six months ended June 30, 2001 was
77%, as compared to 66% for the six months ended June 30, 2000. The increase in
gross profit margins reflect the fact that Catalog sales which have a higher
margins make up a larger portion of the Company's total sales.

The gross profit margin on catalog sales were 85% for the three months ended
June 30, 2001and 2000. The gross profit margin on catalog sales for the six
months ended June 30, 2001 was 83%, as compared to 82% for the six months ended
June 30, 2000. The increase in catalog gross profit margin for the six months
ended June 30, 2000 was a result of a shift in product mix.

                                       12
<PAGE>

Results of Operations (continued)
---------------------------------

The gross profit margin on non-catalog sales for the three months ended June 30,
2001 was 60%, as compared to 47% for the three months ended June 30, 2000. The
gross profit margin on non-catalog sales for the six months ended June 30, 2001
was 59%, as compared to 60% for the six months ended June 30, 2000. The increase
in non-catalog gross profit margins was the result of the mix of products sold.

Research and development ("R&D") expenses reflect the Company's efforts to
identify new product opportunities, develop and package the products for
commercial sale, perform appropriate efficacy and safety tests, and conduct
consumer panel studies and focus groups. R&D expenses for the three months ended
June 2001 were $24,764, a slight increase of $2,905, or 13%, from R&D expenses
of $21,859 for the three months ended June 2000. The amount of R&D expenses per
year varies, depending on the nature of the development work during each year,
as well as the number and type of products under development at such time.

Selling, general and administrative ("SG&A") expenses for the three months ended
June 30, 2001 were $360,470, a decrease of $146,438, or 29%, from SG&A expenses
of $506,908 for the three months ended June 30, 2000. Such expenses for the six
months ended June 30, 2001 were $725,070, a decrease of $229,139, or 24%, from
SG&A expenses of $954,209 for the six months ended June 30, 2000. The decrease
in both periods was principally reduced warehouse costs and consulting fees.

Interest and investment income for the three months ended June 30, 2001 was
$2,742, a decrease of $2,932, or 52%, from interest and investment income of
$5,674 for the three months ended June 30, 2000. Interest and investment income
for the six months ended June 30, 2001 was $4,556, a decrease of $7,294, or 62%,
from interest and investment income of $11,580 for the six months ended June 30,
2000. These decreases were due to lower cash balances for most of the 2001
periods compared to the 2000 periods. The Company maintains a conservative
investment strategy, deriving investment income primarily from U.S. Treasury
securities.

The net loss for the three months ended June 30, 2001 was $133,942, as compared
to a net loss of $278,730 for the three months ended June 30, 2000. The net loss
for the six months ended June 30, 2001 was $354,106, as compared to a net loss
of $427,183 for the six months ended June 30, 2000. The decrease in the net
losses resulted primarily from the factors discussed above.

Liquidity and Financial Resources
---------------------------------

The Company's working capital was approximately $1,087,655 at June 30, 2001.
Cash and cash equivalents are approximately $596,146 at June 30, 2001, an
increase of $405,200 from $190,946 at December 31, 2000. The Company's cash
position has been improved as the result of improved cash management and,
substantially, as the result of a customer's deposit with order.

There were no investing activities for the six months ended June 30, 2001.

                                       13
<PAGE>

Liquidity and Financial Resources (continued)
---------------------------------------------

There were no financing activities during the six months ended June 30, 2001.

The Company has incurred significant losses over the past four years. The
ability of the Company to continue, as a going concern is dependent on
increasing sales and reducing operating expenses.

Management's plan to increase sales and reduce operating expenses includes
several specific actions. Catalog sales will be emphasized since they have
higher profit margins and represent markets that are growing more rapidly than
the Company's traditional television market. Direct marketing techniques will be
used to reach new and current consumers such as promotions mailed to targeted
consumers, Web site specials, promotions to other Web site customers, and direct
e-mail promotions to current customers. Management also plans to increase
international expansion at a controlled level. In addition, the Company is
considering the possibility of raising funds through a private placement stock
offering.

Based on the above plan and the Company's present cash position, the absence of
any short or long term debt, arrangements with third parties for contractual
manufacturing and R&D, and the Company's present business strategy, management
believes that the Company has adequate resources to meet normal, recurring
obligations, for at least the next twelve months, as they become due.

The Company does not have the financial resources to sustain a national
advertising campaign to market its products in a conventional retail mode. In
view of the foregoing, Management's strategy has been to enter into marketing,
licensing and distribution agreements with third parties (such as HSN, QVC,
private label agreements) which have greater financial resources than those of
the Company and that can enhance the Company's product introductions with
appropriate national marketing support programs.

The effect of inflation has not been significant upon either the operations or
financial condition of the Company.

Cautionary Statement Regarding Forward Looking Statements
---------------------------------------------------------

The statements contained in this Report on Form 10-Q that are not purely
historical are forward looking statements within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934, including statements regarding the Company's expectations, hopes,
intentions, beliefs or strategies regarding the future. Forward-looking
statements include the Company's liquidity, anticipated cash needs and
availability, and the anticipated expense levels under the heading "Management's
Discussion and Analysis of Financial Condition and Results of Operations." All
forward looking statements included in this document are based on information
available to the Company on the date of this Report, and the Company assumes no
obligation to update any such forward looking statement. It is important to note
the Company's actual results could differ materially from those expressed or
implied in such forward-looking statements. You should also consult the
Company's Annual Report on Form 10-K for the year ended December 31, 2000 as
well as those factors listed from time to time in the Company's other reports
filed with the Securities and Exchange Commission pursuant to the Securities
Exchange Act of 1934 and the Securities Act of 1933.

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<PAGE>

Part II - Other Information

Item 1.  Legal Proceedings

The Company is not a party to, and its property is not the subject of, any
material pending legal proceedings.

Item 6.  Exhibits and Reports on Form 8-K

None

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<PAGE>

                                   SIGNATURES


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


                                          HYDRON TECHNOLOGIES, INC.



                                          By: /s/ WILLIAM A. FAGOT
                                              -------------------------------
                                              William A. Fagot
                                              Chief Financial Officer

Dated:  August 14, 2001

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