U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                  ------------

                                    FORM 10-Q


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

                 For the quarterly period ended April 1, 2001

                                       OR

[   ]            TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE
                 SECURITIES EXCHANGE ACT OF 1934

                         Commission File Number 0-27148

                    New World Coffee - Manhattan Bagel, Inc.
             (Exact name of registrant as specified in its charter)

            Delaware                                     13-3690261
  (State or other jurisdiction                       (I.R.S. Employer
of Incorporation or organization)                   Identification No.)

                             246 Industrial Way West
                               Eatontown, NJ 07724
          (Address of principal executive offices, including zip code)

                                 (732) 544-0155
              (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 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 ___


Number of shares of common stock, $.001 par value per share, outstanding:  As of
May 8, 2001: 16,443,447


                    NEW WORLD COFFEE - MANHATTAN BAGEL, INC.

              INDEX TO FINANCIAL STATEMENTS AND FINANCIAL SCHEDULES

                                  April 1, 2001
<TABLE>
<CAPTION>

                                                                                                         Page
PART I.     FINANCIAL INFORMATION

         Item 1.  Financial Statements

<S>                                                                                                       <C>
         Condensed Consolidated Balance Sheets as of April 1, 2001 and
                  December 31, 2000..............................................................         -3-

         Condensed Consolidated Statements of Operations for the three months
                  ended April 1, 2001 and March 26, 2000.........................................         -4-

         Condensed Consolidated Statements of Cash Flows for the three months
                  ended April 1, 2001 and March 26, 2000.........................................         -5-

         Notes to Consolidated Financial Statements..............................................         -6-


         Item 2.  MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS FOR THE THREE
         MONTHS ENDED APRIL 1, 2001..............................................................         -8-



PART II:  OTHER INFORMATION......................................................................         -11-

          SIGNATURES.............................................................................         -12-

</TABLE>


                    NEW WORLD COFFEE - MANHATTAN BAGEL, INC.
                           CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>

                                                                                      April 1,                December 31,
                                                                                       2001                      2000
                                                                                    -----------              ------------
ASSETS                                                                              (Unaudited)
------
Current Assets:
<S>                                                                                 <C>                     <C>
    Cash and cash equivalents...................................                    $ 4,227,062             $ 2,271,107
    Franchise and other receivables, net........................                      3,465,456               3,067,765
    Current maturities of notes receivables.....................                        676,768                 676,768
    Inventories.................................................                      1,608,166               1,436,124
    Prepaid expenses and other current assets...................                        653,417                 621,030
      Deferred income taxes - current portion...................                        500,000                 500,000
      Investment in debt securities.............................                     39,155,755              13,888,784
      Assets held for resale....................................                      4,911,243               5,141,491
                                                                                      ---------               ---------
       Total current assets.....................................                     55,197,867              27,603,069

Property, plant and equipment, net..............................                      6,600,048               6,969,731
Notes and other receivables, net................................                        971,640               1,221,861
Trademarks, net.................................................                     15,594,013              15,724,086
Goodwill, net...................................................                      2,300,561               2,325,959
Deferred income taxes                                                                 8,933,740               9,100,178
Deposits and other assets.......................................                      3,131,813               2,753,470
                                                                                      ---------               ---------
       Total Assets                                                                $ 92,729,682            $ 65,698,354
                                                                                   ============            ============

LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current Liabilities:
    Accounts payable............................................                    $ 1,717,058             $ 2,708,398
    Accrued expenses............................................                      2,035,708               3,730,501
    Current portion of long-term debt...........................                      4,885,155               4,422,522
    Current portion of obligations under capital leases.........                        218,858                 199,887
      Other current liabilities                                                          23,275                  14,190
                                                                                         ------                  ------
       Total current liabilities................................                      8,880,054              11,075,498

Long-term debt..................................................                     10,177,288              13,689,957
Obligations under capital leases................................                        224,618                 362,896
Other liabilities...............................................                      1,535,565               1,828,641

Series D Preferred Stock, $.001 par value; 25,000 shares
    authorized; 0 and 16,216 shares issued and outstanding                                    -              12,008,314
Series F Preferred Stock, $.001 par value; 65,000 shares
    authorized; 42,564 and 0 shares issued and outstanding                           28,862,219                       -
Minority interest                                                                     6,258,969                       -

Stockholders' equity:
    Preferred stock, $.001 par value; 2,000,000
       shares authorized; 0 issued and outstanding..............                              -                       -
     Series A convertible preferred stock, $.001 par value; 400
       shares authorized; 0 shares issued and outstanding                                     -                       -
    Series B convertible preferred stock, $.001 par value;
       225 shares authorized, 0 shares outstanding..............                              -                       -
    Series C convertible preferred stock, $.001 par value;
       500,000 shares authorized, 0 shares outstanding..........                              -                       -
    Common stock, $.001 par value; 50,000,000 shares
       Authorized; 15,404,828 and 15,404,828 shares
       issued and outstanding...................................                         15,405                  15,405
    Additional paid-in capital..................................                     58,542,682              45,180,828
    Accumulated deficit.........................................                   (21,767,118)            (18,463,185)
                                                                                   ------------            ------------
       Total stockholders' equity...............................                     36,790,969              26,733,048
                                                                                     ----------              ----------
       Total liabilities and stockholders' equity...............                   $ 92,729,682            $ 65,698,354
                                                                                   ============            ============
</TABLE>



                    NEW WORLD COFFEE - MANHATTAN BAGEL, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
          FOR THE FIRST QUARTER ENDED APRIL 1, 2001 AND MARCH 26, 2000

                                    UNAUDITED
                                    ---------



<TABLE>
<CAPTION>

                                                                            April 1,         March 26,
                                                                             2001              2000
                                                                           ---------         ---------
Revenues:

<S>                                                                      <C>               <C>
    Manufacturing revenues........................................       $ 5,149,755       $ 6,150,638
    Franchise related revenues....................................         1,653,352         1,774,944
    Retail sales..................................................         3,672,075         1,220,500
                                                                           ---------         ---------
Total revenues....................................................        10,475,182         9,146,082

    Cost of sales.................................................         7,366,535         5,860,051
    General and administrative expenses...........................         1,702,404         1,585,173
    Depreciation and amortization.................................           786,695           571,915
                                                                             -------         ---------
 Income from operations...........................................           619,548         1,128,943

Interest expense, net.............................................           444,053           478,178
Gain from sale of investments.....................................           240,601                 -
                                                                             -------           -------

Income before income taxes........................................           416,096           650,765

Provision for income taxes........................................           166,438                 -
                                                                             -------           -------
Net income........................................................           249,658           650,765

Dividends and accretion on preferred stock........................         3,671,992                 -
                                                                           ---------          --------
Net (loss) income available to common stockholders................      ($3,422,334)          $650,765
                                                                        ============          ========

Net (loss) income per common share - Basic........................          ($  .22)             $ .06
                                                                            ========             =====

Net (loss) income per common share - Diluted......................          ($  .22)             $ .06
                                                                            ========             =====

Weighted average number of common shares outstanding:
     Basic........................................................        15,404,828        11,386,777
                                                                          ==========        ==========

     Diluted......................................................        15,404,828        11,684,286
                                                                          ==========        ==========
</TABLE>




                    NEW WORLD COFFEE - MANHATTAN BAGEL, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
          FOR THE FIRST QUARTER ENDED APRIL 1, 2001 AND MARCH 26, 2000

                                    UNAUDITED
                                    ---------
<TABLE>
<CAPTION>

                                                                                   April 1,       March 26,
                                                                                     2001            2000
                                                                                   --------       ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                                 <C>           <C>
    Net income..........................................................            $249,658      $650,765
    Adjustments to reconcile net income to net cash used in
       operating activities:
        Depreciation and amortization...................................             786,695       571,915
        Gain on sale of debt securities.................................           (240,601)             -
        Deferred income tax asset.......................................             166,438             -
    Increase/(decrease) in cash as a result of changes in operating assets
          and liabilities:
        Receivables.....................................................           (397,691)     (271,807)
        Inventories.....................................................           (172,042)     (198,435)
        Prepaid expenses................................................            (32,387)         3,580
        Deposits and other assets.......................................             246,039         2,785
        Receipts of notes receivable....................................             260,036        84,745
        Additions to notes receivable...................................             (9,815)             -
        Accounts payable................................................           (991,340)        44,415
        Accrued expenses................................................           (832,569)     (424,302)
        Other liabilities...............................................           (159,629)     (110,302)
                                                                                   ---------     ---------
                    Net cash provided by/(used in) operating activities          (1,127,208)       353,359
                                                                                 -----------     ---------

CASH FLOWS FROM INVESTING ACTIVITIES:
    Capital expenditures................................................            (31,293)     (101,975)
    Addition to assets held for resale..................................                   -      (15,437)
    Deferred acquisition costs..........................................           (624,382)             -
    Investment in debt securities.......................................        (28,911,364)             -
    Proceeds from the sale of debt securities...........................           3,884,994             -
                                                                                   ---------     ---------
                    Net cash provided by/(used in) investing activities         (25,682,045)     (117,412)
                                                                                ------------     ---------

CASH FLOWS FROM FINANCING ACTIVITIES:
    Proceeds from issuance of stock, net................................          23,755,148       161,999
    Minority owners' capital contributions to affiliated entity.........           9,165,989             -
    Payment of liabilities in connection with acquired assets...........           (986,586)     (787,833)
    Repayments of capital leases........................................           (119,307)     (120,842)
    Repayment of notes payable..........................................         (3,050,036)      (18,235)
                                                                                 -----------      --------
                    Net cash provided by/(used in) financing activities           28,765,208     (764,911)
                                                                                  ----------     ---------

                    Net increase /(decrease) in cash                               1,955,955     (528,964)

CASH, beginning of period...............................................           2,271,107     2,880,342
                                                                                   ---------     ---------

CASH, end of period.....................................................          $4,227,062    $2,351,378
                                                                                  ==========    ==========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
    Cash paid during the period for:
    Interest........................................................................ 683,789       857,921
</TABLE>



                    NEW WORLD COFFEE - MANHATTAN BAGEL, INC.

                   Notes to Consolidated Financial Statements
                                   (Unaudited)

1.   The April 1, 2001  consolidated  balance sheet presented herein was derived
     from the audited December 31, 2000 consolidated financial statements of the
     Company.

2.   These  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.  The  consolidated
     financial  statements  should  be  read in  conjunction  with  the  audited
     consolidated  financial  statements  of the  Company  for  the  year  ended
     December 31, 2000 for a description of the significant accounting policies,
     which have continued without change, and other note information.

3.   All  adjustments  (recurring  in  nature)  which  are,  in the  opinion  of
     management, necessary for a fair presentation of the results of the interim
     periods  have been  included.  The results of the  interim  periods are not
     necessarily indicative of the results for the full year.


                SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this Form 10-Q under "Management's Discussion and Analysis
of Financial  Condition and Results of Operations"  constitute  "forward-looking
statements" within the meaning of the Private  Securities  Litigation Reform Act
of 1996 with respect to the financial condition and business of the Company. The
words "estimate", "plan", "intend", "believe", "expect", and similar expressions
are  intended  to  identify  forward-looking  statements.  Such  forward-looking
statements  involve and are subject to known and unknown  risks,  uncertainties,
and other  factors  which  could  cause the  actual  results,  performance,  and
achievements of the Company to be materially  different from any future results,
performance  (financial or operating),  or achievements  expressed or implied by
such  forward-looking  statements.  Such  factors  include,  among  others,  the
following:  competition;  success  of  operating  and  franchising  initiatives;
development schedules;  advertising and promotional efforts;  adverse publicity;
acceptance of new product offerings; availability of new locations, and terms of
sites for store development;  changes in business strategy or development plans;
availability  and terms of capital;  food,  labor,  and employee  benefit costs;
changes  in  government  regulations;  regional  weather  conditions;  and other
factors  referenced  in this Form 10-Q or in the  Company's  Form 10-KSB for its
2000 fiscal year.


<PAGE>



                 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

General

     New World Coffee - Manhattan Bagel, Inc. is one of the largest  franchisors
of bagel  bakeries  and  coffee  bars in the  United  States.  It  operates  and
franchises  bagel  bakeries and coffee bars in 26 states  throughout  the United
States and the District of Columbia.  The first  Company-owned  New World Coffee
store opened in 1993 and the first  franchised  New World Coffee store opened in
1997. On November 24, 1998, the Company  acquired the stock of Manhattan  Bagel,
Company,  Inc. ("MBC")..  On August 31, 1999, the Company acquired the assets of
Chesapeake  Bagel Bakery ("CBB").  At April 1, 2001, the Company's retail system
consisted  of  approximately  337 stores,  including  42  Company-owned  and 295
franchised and licensed stores.

     The Company is vertically  integrated  and has bagel dough and cream cheese
manufacturing plants in Eatontown, NJ and Los Angeles, CA, and a coffee roasting
plant in Branford,  CT. The Company's products are sold to franchised,  licensed
and   Company-owned   stores   as  well  as  to   wholesale,   supermarket   and
non-traditional outlets.

     The Company is a Delaware corporation and was organized in November 1992.

     Commencing  in August 2000,  the Company  acquired  certain  debentures  of
Einstein/Noah Bagel Corp. ("ENBC"), a Company engaged in the retail bagel bakery
business.  ENBC has been operating under Chapter 11 of the Bankruptcy Code since
April 2000.  The  Company and its  affiliate  New World -  Greenlight,  LLC have
acquired  in excess of  $61,000,000  of face  value of  debentures,  making  the
Company ENBC's largest  creditor.  As ENBC's largest  creditor,  the Company has
been an active participant in ENBC's ongoing Bankruptcy proceedings.

     On April 2,  2001,  the  Trustee  (the  "Trustee")  of the  Boston  Chicken
Bankruptcy Plan Trust,  as holder of a majority of the outstanding  common stock
of ENBC, filed a plan of reorganization (the "Trustee Plan") with the Bankruptcy
Court providing for  reinstatement  of all the obligations of ENBC and providing
for an  allocation  of new common stock of ENBC to the holders of its old common
stock,  including the Trustee.  The Company agreed to support the Trustee's Plan
and committed, to the Trustee, and to the lead institution that had committed to
provide exit financing to ENBC pursuant to the Trustee's  Plan, that the Company
would  convert  the  debentures  owned  by it and  its  affiliate  New  World  -
Greenlight LLC into new common stock of reorganized  ENBC in accordance with the
Trustee's Plan.

     In  addition,  on May 14, 2001 a deadline set by the  Bankruptcy  Court for
competing  bids in order to preserve a right to bid on the assets of ENBC in the
event that the Trustee's Plan is not confirmed,  Einstein  Acquisition  Corp., a
Delaware corporation which is an affiliate of the Company made a bid to purchase
the  assets  of  ENBC.  Such  bid  consisted  of  $151,000,000  in cash  and the
assumption of Einstein trade indebtedness up to a total of $30,000,000.

     The  Company  and  Einstein  Acquisition  Corp.  have  received  a  "highly
confident"  letter from a  nationally  recognized  investment  banking firm with
respect to financing necessary to consummate a transaction with ENBC. Bankruptcy
Court  proceedings are ongoing both with respect to the issue of confirmation of
the Trustee's Plan and the bid for the assets of ENBC. There can be no assurance
as to the outcome of such Bankruptcy Court proceedings.


Fiscal  Quarter Ended April 1, 2001  Compared to Fiscal  Quarter Ended March 26,
2000

     Revenues.  Total revenues  increased  14.5% to  $10,475,182  for the fiscal
quarter ended April 1, 2001 from $9,146,082 for the comparable 2000 period.  The
increase in revenues was  attributable  to additional  retail sales from Company
owned stores acquired  during 2000.  Manufacturing  revenues  decreased 16.3% to
$5,149,755 or 49.2% of total revenues for the fiscal quarter ended April 1, 2001
from $6,150,638 or 67.2% of total revenues for the comparable  2000 period.  The
decrease in  manufacturing  revenues was  primarliy  the result of the Company's
decision to  outsource  its  low-margin  distribution  business  (which had been
included in manufacturing revenues in the 2000 period.) In addition, the Company
experienced  extreme  weather in its core markets during the 2001 quarter,  also
having a negative impact on manufacturing  revenues.  Franchise related revenues
decreased  6.9% to $1,653,352 or 15.8% of total  revenues for the fiscal quarter
ended  April  1,  2001  from  $1,774,944  or 19.4%  of  total  revenues  for the
comparable 2000 period. The decrease in franchise related revenues was partially
attributable to extreme weather conditions experienced during the fiscal quarter
ended April 1, 2001 in the  Company's  core  markets.  In addition,  the decline
reflects a lower store base in the fiscal  quarter ended April 1, 2001, in part,
resulting from  Management's  decision to terminate  certain  franchisees  who's
operations did not comply with the Company's  policies.  Retail sales  increased
200.9% to  $3,672,075  or 35.0% of total  revenues for the fiscal  quarter ended
April 1, 2001 from $1,220,500 or 14.9% of total revenues for the comparable 2000
period.  The increase was attributable to additional  company-owned  stores that
were acquired during 2000.

Costs and Expenses.
Cost of  Sales  as a  percentage  of  related  manufacturing  and  retail  sales
increased to 83.5% for the fiscal quarter ended April 1, 2001 from 79.5% for the
comparable 2000 period.  The increase  primarily  resulted from a shift in sales
mix towards  retail  store  revenues  which  generally  have lower  margins than
manufacturing revenues.

General and  administrative  expenses  increased  to  $1,702,404  for the fiscal
quarter ended April 1, 2001 from $1,585,173 for the comparable 2000 period.  The
increase was primarily  attributable to operational staff additions  required in
order to service the  Company's  additional  company-owned  stores.  General and
administrative  expenses expressed as a percentage of total revenues declined to
16.3% of total revenues for the fiscal quarter ended April 1, 2001 from 17.3% of
total revenues for the comparable 2000 period.  The decline is the result of the
higher revenue base during the 2001 quarter.

Depreciation and amortization expenses increased by 37.6% to $786,695 or 7.5% of
total  revenues for the fiscal quarter ended April 1, 2001 from $571,915 or 6.3%
of total  revenues for the  comparable  2000 period.  The increase was primarily
attributable to depreciation on company-owned stores acquired during 2000.

Interest  expense,  net for the fiscal  quarter ended April 1, 2001 decreased to
$444,053,  or 4.2% of total revenues from $478,178 or 5.2% of total revenues for
the  comparable  2000 period.  This  decrease is  primarily  the result of lower
average debt balances during the quarter ended April 1, 2000 as well as interest
earned invested cash balances.

Gain from sale of debt securities was $240,601 or 2.3% of total revenues for the
fiscal  quarter  ended April 1, 2001.  There was no such gain in the  comparable
2000 period.

Provision for income taxes  increased to $166,438 or 1.6% of total  revenues for
the fiscal quarter ended April 1, 2001 from $0 for the  comparable  2000 period.
The increase was attributable to certain deferred tax benefits recognized in the
2000 period relating to the recognition of deferred tax assets.

Net Income.
Net income for the fiscal  quarter ended April 1, 2001  decreased to $249,658 or
2.4%  of  total  revenues  from  $650,765  or  7.1% of  total  revenues  for the
comparable  2000 period.  This increase is primarily a result of the decrease in
margins  resulting from a change in sales mix to lower margin retail sales.  and
the increase in income tax expense recognized for the 2001 period.


Liquidity and Capital Resources


     The  Company  plans to  satisfy  any of its  capital  requirements  in 2001
through  cash  flow  from  operations  and the sale of  Company-owned  stores to
franchisees  which should  generate  additional  cash.  The Company  continually
assesses its ongoing  capital  needs and may consider the issuance of additional
equity or debt securities in order to raise capital should  business  conditions
dictate that such is necessary.

     In January  and March  2001,  the  Company  issued  25,000  shares of newly
authorized  Series F Preferred  Stock.  The  proceeds,  net of related  offering
expenses,  were $ 23,755,148.  The proceeds from these stock sales were utilized
to purchase ENBC debt securities and pay certain related costs.

     At April 1, 2001 the Company had a working  capital  surplus of $46,317,813
compared to a working  capital  surplus of  $2,547,029  at March 26, 2000.  This
increase  is  primarily  a  result  of the  Company's  investment  in ENBC  debt
securities in exchange for the issuance of certain preferred stock.

     The Company had net cash used in operating activities of $1,127,208 for the
first quarter of 2001 compared with net cash provided by operating activities of
$353,359  for the first  quarter  of 2000.  The  decrease  in cash  provided  by
operating  activities  was  attributable  to  the  decrease  in net  income  and
liquidation of certain current liabilities in the 2001 period.

     The Company had net cash used in investing  activities of  $25,682,045  for
the first quarter of 2001 compared with net cash used in investing activities of
$117,412 for the first  quarter of 2000.  The increase in cash used in investing
activities was attributable to the Company's investment in debt securities.

     The Company had net cash provided by financing  activities  of  $28,765,208
for  the  first  quarter  of 2001  compared  with  net  cash  used in  financing
activities  of  $764,911  for the first  quarter of 2000.  The  increase in cash
provided by financing  activities relates to the issuance of preferred stock and
proceeds from sale of an interest in an affiliated entity during 2001.

Seasonality and General Economic Trends

     The  Company  anticipates  that its  business  will be  affected by general
economic  trends that  affect  retailers  in general.  While the Company has not
operated  during a period  of high  inflation,  it  believes  based on  industry
experience  that it would generally be able to pass on increased costs resulting
from inflation to its customers. The Company's business may be affected by other
factors,  including  increases in the  commodity  prices of green coffee  and/or
flour,  acquisitions by the Company of existing stores,  existing and additional
competition,  marketing programs, weather, and variations in the number of store
openings.  The Company has few, if any,  employees at the minimum wage level and
therefore  believes  that an  increase in the  minimum  wage would have  minimal
impact on its operations and financial condition.



                           PART II - OTHER INFORMATION
                    NEW WORLD COFFEE - MANHATTAN BAGEL, INC.

                                  APRIL 1, 2001

Item 1.   Legal Proceedings

          Not applicable

Item 2.   Changes in Securities

          Not applicable

Item 3.   Defaults upon Senior Securities

          Not applicable

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

          Not applicable

Item 5.   Other Information

          Not applicable

Item 6.   Exhibits and Reports on Form 8-K

          (a)  Exhibits

               None

          (b)  Reports on Form 8-K

               On February 1, 2001, the Company filed a Form 8-K relating to
               the issuance of Series F Preferred Stock and related matters.



                                   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.

                           New World Coffee - Manhattan Bagel, Inc.

Date: May 21, 2001         By: /s/ R. Ramin Kamfar
                               -------------------
                               R. Ramin Kamfar
                               Chairman and Chief Executive Officer



Date: May 21, 2001         By: /s/ Jerold E. Novack
                               --------------------
                               Jerold E. Novack
                               Chief Financial Officer