SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C. 20549



                                 FORM 10-Q

                QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
                  OF THE SECURITIES EXCHANGE ACT OF 1934


For Quarter Ended February 28, 2001        Commission File No. 0-5940


                          TEMTEX INDUSTRIES, INC.
        ----------------------------------------------------------
          (Exact name of Registrant as specified in its Charter)



              Delaware                         75-1321869
   -------------------------------        ----------------------
   (State or other jurisdiction of           (I.R.S Employer
   incorporation or organization)          Identification No.)



  5400 LBJ Freeway, Suite 1375, Dallas, Texas         75240
 --------------------------------------------       ----------
   (Address of principal executive offices)         (Zip Code)



                972/726-7175
---------------------------------------------------
(Registrant's telephone number including area code)



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 such shorter period that
the registrant was required to file such reports), and (2) has been
subject to such filing requirement for the past 90 days.

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


The Registrant had 3,444,641 shares of common stock, par value $.20 per
share, outstanding as of the close of the period covered by this
report.



<PAGE>


<TABLE>
<CAPTION>
                         PART I.  FINANCIAL INFORMATION

                    TEMTEX INDUSTRIES, INC. AND SUBSIDIARIES
           Condensed Consolidated Statements of Operations (Unaudited)
                 (In thousands except share and per share data)

                                            Three Months Ended              Six Months Ended
                                       February 28,    February 29,   February 28,   February 29,
                                           2001            2000           2001           2000
                                       --------------   ------------  ------------    -------------
<S>                                    <C>              <C>           <C>            <C>
Net sales                                 $     4,098     $    5,210    $    9,034      $    11,334
Cost of goods sold                              3,993          4,829         8,358            9,977
                                          -----------     ----------    ----------      -----------
                                                  105            381           676            1,357

Cost and expenses:
  Selling, general and administrative           1,346          2,015         2,781            3,797
  Interest                                        126             60           213              103
  Other expense (income)                           37              4           (15)            (145)
                                          -----------     ----------    ----------      -----------
                                                1,509          2,079         2,979            3,755
                                          -----------     ----------    ----------      -----------
    LOSS FROM OPERATIONS
        BEFORE INCOME TAX BENEFIT              (1,404)        (1,698)       (2,303)          (2,398)

State, federal and foreign income tax
  benefit                                          --           (679)           --             (959)
                                          -----------     ----------    ----------      -----------
    NET LOSS                              $    (1,404)    $   (1,019)   $   (2,303)     $    (1,439)
                                          ===========     ==========    ==========      ===========

Basic and diluted loss per common
 share:                                   $      (.41)    $     (.30)   $     (.67)     $      (.42)
                                          ===========     ==========    ==========      ===========
Basic and diluted weighted average
  common shares outstanding                 3,444,641      3,444,641     3,444,641        3,444,641
                                          ===========     ==========    ==========      ===========
</TABLE>


See notes to condensed consolidated financial statements.


                                 -2-



<PAGE>


              TEMTEX INDUSTRIES, INC. AND SUBSIDIARIES
                Condensed Consolidated Balance Sheets
           (In thousands except share and per share data)



                                          February 28,   August 31,
                                              2001          2000
                                          ------------   -----------
                                           (Unaudited)
ASSETS

CURRENT ASSETS
  Cash and cash equivalents                 $      426      $  1,021
  Accounts receivable, less allowance
    for doubtful accounts of
    $348 at February 28, 2001 and $319 at
    August 31, 2000                              2,432         2,847
  Inventories                                    7,590         7,452
  Prepaid expenses and other assets                225           180
  Income taxes recoverable                         604           484

                                            ----------    ----------
             TOTAL CURRENT ASSETS               11,277        11,984

OTHER ASSETS                                       147           162

PROPERTY, PLANT AND EQUIPMENT
  Buildings and improvements                     2,615         2,615
  Machinery, equipment, furniture and
    fixtures                                    18,575        18,432
  Leasehold improvements                         1,306         1,302
                                            ----------    ----------
                                                22,496        22,349
  Less allowances for depreciation and
   amortization                                 18,476        17,954
                                            ----------    ----------
                                                 4,020         4,395

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

                                            $   15,444    $   16,541
                                            ==========    ==========


                                 -3-



<PAGE>


                                              February 28,    August 31,
                                                  2001           2000
                                              ------------  -------------
                                              (Unaudited)
LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Notes payable                                $     2,180      $       --
  Accounts payable                                   1,302           1,565
  Accrued expenses                                     883           1,396
  Income taxes payable                                  31             206
  Current maturities of indebtedness to
   related parties                                      17              15
  Current maturities of long-term
   obligations                                          34              32
                                               -----------      ----------

            TOTAL CURRENT LIABILITIES                4,447           3,214

INDEBTEDNESS TO RELATED PARTIES,
  less current maturities                            1,556           1,565

LONG-TERM OBLIGATIONS,
  less current maturities                              354             372

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY
  Preferred stock - $1 par value; 1,000,000
    shares authorized, none issued                      --              --
  Common stock - $.20 par value; 10,000,000
    shares authorized,
    5,286,125 shares issued                            720             720
  Additional capital                                 9,253           9,253
  Retained earnings (deficit)                         (447)          1,856
                                               -----------      ----------
                                                     9,526          11,829
Less:
    Treasury stock:
      At cost - 153,696 shares                         439             439
      At no cost - 1,687,788 shares                     --              --
                                               -----------      ----------
                                                     9,087          11,390

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

                                               $    15,444      $   16,541
                                               ===========      ==========


See notes to condensed consolidated financial statements.



                                 -4-

<PAGE>



              TEMTEX INDUSTRIES, INC. AND SUBSIDIARIES
     Condensed Consolidated Statements of Cash Flows (Unaudited)
                           (in thousands)


                                                  Six Months Ended
                                            February 28,   February 29,
                                            -----------    ------------
                                                2001          2000
                                               -----          -----
OPERATING ACTIVITIES
  Net loss                                  $   (2,303)    $   (1,439)
  Adjustments to reconcile net loss to
    net cash used in operating
    activities:
   Depreciation and amortization                   564            605
   Loss on disposition of property,
    plant and equipment                             --             12
   Provision for doubtful accounts                  64             74
   Changes in operating assets and
    liabilities:
     Accounts receivable                           351            356
     Inventories                                  (138)           643
     Prepaid expenses and other assets             (30)         1,488
     Accounts payable and accrued
      expenses                                    (776)          (540)
     Income taxes payable/recoverable             (295)        (1,415)
                                            ----------     ----------
       NET CASH USED IN OPERATING
        ACTIVITIES                              (2,563)          (216)

INVESTING ACTIVITIES
  Purchases of property, plant and
   equipment                                      (189)          (410)
                                            ----------     ----------
       NET CASH USED IN INVESTING
        ACTIVITIES                                (189)          (410)

FINANCING ACTIVITIES
  Net proceeds from notes payable                2,180             --
  Principal payments on long-term
   obligations and indebtedness
   to related parties                              (23)           (20)
                                            ----------     ----------
       NET CASH PROVIDED BY (USED IN)
        FINANCING ACTIVITIES                     2,157            (20)
                                            ----------     ----------

DECREASE IN CASH AND CASH EQUIVALENTS             (595)          (646)
Cash and cash equivalents at beginning
 of period                                       1,021          4,077
                                            ----------     ----------

       CASH AND CASH EQUIVALENTS AT END
         OF PERIOD                          $      426     $    3,431
                                            ==========     ==========

See notes to condensed consolidated financial statements.

                                 -5-


<PAGE>


NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE A--BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial
statements include the accounts of Temtex Industries, Inc. (the
Company) and its wholly owned subsidiaries.  All significant
intercompany accounts and transactions have been eliminated.

The condensed financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial
information and with the instructions for Form 10-Q and Rule 10-01 of
Regulation S-X.  Accordingly, they do not include all of the
information and notes 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 six-month period ended February 28, 2001
are not necessarily indicative of the results that may be expected
for the year ending August 31, 2001.  For further information, refer
to the consolidated financial statements and notes thereto included
in the Company's annual report on Form 10-K for the year ended August
31, 2000.

NOTE B--INCOME TAXES

For the six-month period ended February 29, 2000, the Company
recorded a state and federal tax benefit using an effective rate of
approximately 39%.

For the six-month period ended February 28, 2001, no state and
federal income tax benefit has been recorded as the Company has
recorded a valuation allowance to fully reserve the net operating
loss carryforwards since the realization of these assets is
uncertain.

The Company has state net operating loss carryforwards of
approximately $11,500,000 expiring in the years 2002 through 2015.
In addition, the Company also has a federal net operating loss
carryforward of approximately $3,100,000 which begins to expire in
the year 2021.

NOTE C--INCOME PER (LOSS) COMMON SHARE

Basic income (loss) per common share is based upon the weighted
average number of shares of common stock outstanding during each
period.  Diluted income (loss) per share is based upon the weighted
average number of shares of common stock and common stock
equivalents outstanding during each period unless the effect of the
common stock equivalents would be antidilutive.  Common stock
equivalents include options granted to key employees and outside
directors.  The number of common stock equivalents was based on the
number of shares issuable on the exercise of options reduced by the
number of shares that are assumed to have been purchased at the
average price of common stock during each quarter with the proceeds
from the exercise of the options.

                                 -6-


<PAGE>

NOTE D--INVENTORIES

Inventories are summarized below:


                             February 28, 2001    August 31, 2000
                             -----------------   ----------------
                                      (in thousands)
Finished goods                      $ 3,211            $ 2,992
Work in process                         461                619
Raw materials and supplies            3,918              3,841
                                    -------            -------
                                    $ 7,590            $ 7,452
                                    =======            =======


NOTE E--NOTES PAYABLE AND LONG-TERM DEBT

In September 2000, the Company entered into a three-year credit
agreement with Frost Capital Group whereby the Company may borrow a
maximum of $4,000,000 under a revolving credit facility.  The amount
available under the facility is subject to limitations based on
specified percentages of the Company's eligible outstanding accounts
receivable and inventory.  The outstanding principal is due on
demand and bears interest at an annual rate of 1.25% above the
specified bank's prime commercial interest rate.  Interest is
payable monthly and is added to the outstanding loan balance.  The
credit agreement does not require the maintenance of any financial
ratios.  At February 28, 2001 there was approximately $2,180,000
outstanding under the credit facility with approximately $1,820,000
of unused credit still available.

NOTE F--COMMITMENTS AND CONTINGENCIES

Due to the complexity of the Company's operations, disagreements
occasionally occur.

In the opinion of management, the Company's ultimate loss from such
disagreements and potential resulting legal action, if any, will not
be significant.

NOTE G--FOREIGN OPERATIONS

At February 28, 2001 net assets of approximately $1,012,000 were
located at the Company's manufacturing facility in Mexico.


                                 -7-

<PAGE>


          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS


The following discussion and analysis of the financial condition and
results of operations of the Company should be read in conjunction
with the unaudited condensed consolidated financial statements and
related notes of the Company included elsewhere in this report.  This
Management's Discussion and Analysis of Financial Condition and
Results of Operations and other parts of this Quarterly Report on
Form 10-Q contain forward-looking statements that involve risks and
uncertainties.  Among the risks and uncertainties to which the
Company is subject are the risks inherent in the cyclical and
unpredictable nature of the housing and home products business
generally, fluctuations in interest rates, geographic concentration
of the Company's primary market, the fact that the Company has
experienced fluctuations in revenues and operating results, and the
highly competitive nature of the industries in which the Company
competes, together with each of those other factors set forth in the
Company's filings made with the Securities & Exchange Commission.  As
a result, the actual results realized by the Company could differ
materially from the results discussed in the forward-looking
statements made herein.  Words or phrases such as "will,"
"anticipate," "expect," "believe," "intend," "estimate," "project,"
"plan" or similar expressions are intended to identify forward-
looking statements.  Readers are cautioned not to place undue
reliance on the forward-looking statements made in this Quarterly
Report on Form 10-Q.

Net Sales

Net sales of fireplace products decreased approximately 21% or
$1,112,000 in the second quarter of fiscal 2001 compared to the
second quarter of fiscal 2000.  The decrease in sales resulted from
the decrease in customer orders and the decreased quantity of
fireplaces delivered in the second quarter of 2001 compared to the
second quarter of 2000.  Between the comparative six-month periods,
net sales decreased approximately 20% or $2,300,000 in fiscal 2001,
again due to the decrease in quantities delivered.  Competition
within the industry continues to suppress selling prices.

Gross Profit

Gross profit decreased from  $381,000 to $105,000 or approximately
72% from the second quarter of fiscal 2000 to the second quarter of
fiscal 2001.  Between the comparative six-month periods, gross profit
decreased from $1,357,000 in fiscal 2000 to $676,000 in fiscal 2001.
In both comparison periods, the decrease in gross profit resulted
from the reduced level of sales, which did not allow for full
recovery of overhead costs.

Selling, General and Administrative Expenses

Selling, general and administrative expenses decreased approximately
$669,000 or 33% in the second quarter of fiscal 2001 compared to the
second quarter of fiscal 2000.  Between the comparative six-month
periods, selling, general and administrative expenses decreased
approximately $1,016,000 or 27%.  Significant reductions were
recorded in salaries, wages, selling commissions and related payroll
expenses.

                                 -8-


<PAGE>


These reductions resulted primarily from the plan initiated in fiscal
2000 to relocate the majority of manufacturing from the California
facility to Tennessee and Mexico along with personnel reductions in
California and the Corporate office.

Interest Expense

Net interest expense increased by $66,000 between the comparative
quarters and $110,000 between the six-month periods.  The increase
was primarily attributable to an increase in the average indebtedness
in fiscal 2001 resulting from borrowings under the new line of
credit.

Income Taxes

The Company has not recorded a benefit for income taxes on its
operating loss in fiscal 2001 due to the Company recording a
valuation allowance to fully reserve the entire amount until such
time that reassessment indicates that it is more likely than not that
the benefits will be realized.  For both the three-month period and
the six-month period ended February 29, 2000, the Company recorded a
state and federal tax rate benefit using an effective rate of
approximately 40%.

Liquidity and Capital Resources

Net cash used by operating activities was $2,563,000 for the first
six-months of fiscal 2001 compared to $216,000 for the first six
months of 2000.  The decreased cash flow from operations in the first
six-months of fiscal 2001 was primarily due to the operating loss and
the decrease in accounts payable and accrued expenses.

Working capital decreased $1,940,000 in the first six-months of
fiscal 2001 due mainly to the loss from operations which resulted in
the need for the Company to borrow under its credit agreement.

Capital expenditures and capitalized lease obligations for the first
six months of 2001 were $189,000.  Expenditures include amounts for
tooling, dies, replacement items and major repairs to manufacturing
equipment.

In September 2000, the Company entered into a three-year credit
agreement with Frost Capital Group whereby the Company may borrow a
maximum of $4,000,000 under a revolving credit facility.  The amount
available under the facility is subject to limitations based on
specified percentages of the Company's eligible outstanding accounts
receivable and inventory.  The outstanding principal is due on demand
and bears interest at an annual rate of 1.25% above the specified
bank's prime commercial interest rate and is secured by the assets of
the Company and its subsidiary, Temco Fireplace Products, Inc.
Interest is payable monthly and is added to the outstanding loan
balance.  The credit agreement does not require the maintenance of
any financial ratios.  At February 28, 2001, there was approximately
$2,180,000 outstanding under the credit facility and approximately
$1,820,000 remaining available.


                                 -9-

<PAGE>

The Company believes that future cash flow from operations, together
with funds available from the revolving credit facility, should
provide the Company with adequate funds to meet its working capital
requirements as well as requirements for capital expenditures for at
least the next twelve months.  However, to the extent the Company
continues to experience operating losses in future periods that cause
the Company to require capital in excess of the borrowing capacity of
its existing revolving credit facility, it may be required to seek
additional borrowing capacity under its existing revolving credit
facility or additional sources of capital.  Sources of additional
capital may include public and private equity and debt financings,
sales of nonstrategic assets and other financing arrangements.  No
assurances can be made that the Company will be able to obtain
sufficient capital in the future.

Other

On January 12, 2001, the Company received a letter from
Nasdaq stating that the Company's common stock had failed to
maintain a minimum bid price of $1.00 over the previous 30
consecutive trading days as required by The Nasdaq SmallCap
Market under Marketplace Rule 4310(c)(4) and, therefore, in
accordance with Marketplace Rule 4310(c)(8)(B), the Company would
be provided 90 calendar days, or until April 12, 2001, to regain
compliance with Marketplace Rule 4310(c)(4).  The January 12
Nasdaq letter further states that if the Company's common stock
fails to demonstrate compliance with Marketplace Rule 4310(c)(4)
on or before April 12, 2001, the staff of Nasdaq would provide
the Company with written notification that its common stock would
be delisted, although the Company would have the right to appeal
the staff's determination.  The Company's common stock failed to
regain compliance with Marketplace Rule 4310(c)(4) on or before
April 12, 2001.  Accordingly, the Company expects to receive a
letter from Nasdaq's staff notifying it that its common stock
will be delisted from the Nasdaq SmallCap Market.  The Company
has not yet received such a letter.  The Company does not intend
to appeal the expected determination of Nasdaq's staff.

Upon the expected delisting of the Company's common stock with the
Nasdaq SmallCap Market, the Company intends for its stock to be traded
via the OTC Bulletin Board(R) (OTCBB). The expected delisting of the
Company's stock on the Nasdaq SmallCap Market will likely adversely
affect the ability or willingness of investors to purchase the Company's
stock. In addition, the market liquidity of the Company's securities is
likely to be adversely affected.


                                -10-


<PAGE>

                     PART II.  OTHER INFORMATION



Item 6.   EXHIBITS AND REPORTS ON FORM 8-K

        The Registrant did not file any reports on Form 8-K during
        the quarter for which this report is filed.




                                -11-


<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.

                                       TEMTEX INDUSTRIES, INC.



DATE:           4/16/01                BY:  /s/  E.R.Buford
            ------------                  ---------------------
                                          E. R. Buford
                                          President



DATE:           4/16/01                BY:  /s/ R. L. DeLozier
            ------------                  ---------------------
                                          R. L. DeLozier
                                          Secretary/Treasurer



                                -12-