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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                FORM 10-KSB/A-1

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

           [ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
                   For the fiscal year ended December 31, 1996
                                       OR
             [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
           For the transition period from ____________ to ___________

                          Commission file number 0-4748

                              DATA DIMENSIONS, INC.
           (Name of Small Business Issuer as Specified in Its Charter)

         DELAWARE                                              06-0852458
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                            Identification Number)


                               2000 SKYLINE TOWER
                              10900 N.E. 4TH STREET
                           BELLEVUE, WASHINGTON 98004
                                 (206) 688-1000
          (Address and Telephone Number of Principal Executive Offices)

       Securities registered under Section 12(b) of the Exchange Act: NONE

         Securities registered under Section 12(g) of the Exchange Act:

                     COMMON STOCK, PAR VALUE $.001 PER SHARE
                                (Title of Class)
                    -----------------------------------------

         Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes [X] No[ ]

         Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B contained in this form, and no disclosure will be
contained, to the best of the registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [ ]

         The issuer's revenues for the fiscal year ended December 31, 1996 were
$14,835,000.

         The aggregate market value of the voting stock held by non-affiliates
computed by reference to the price at which the stock was sold, or the average
bid and asked price of such stock, as of March 5, 1997 was approximately
$160,000,000.

         As of March 5, 1997, there were 3,816,740 shares of Common Stock, par
value $.001 per share, outstanding.

         The index to exhibits appears on page 34 of this document.
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                       DOCUMENTS INCORPORATED BY REFERENCE

         The Registrant has incorporated into Part III of this Form 10-KSB by
reference portions of the Proxy Statement for its 1997 Annual Meeting of
Shareholders.
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                                   SIGNATURES


         In accordance with the Securities Exchange Act of 1934, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized, on this 6th day of May, 1997.


                                           DATA DIMENSIONS, INC.
                                           (Registrant)


                                           By /s/ Larry W. Martin
                                             -----------------------------------
                                                  Larry W. Martin
                                                  Chief Executive Officer

         In accordance with the Securities Exchange Act of 1934, this report has
been signed below by the following persons on behalf of the registrant and in
the capacities and on the dates indicated:

<TABLE>
<CAPTION>

              Signature                   Title                                Date
              ---------                   -----                                ----
<S>                                       <C>                                  <C>
 /s/ Larry W. Martin                      Chief Executive Officer              May 6, 1997
----------------------------------        and Director (principal                                     
     Larry W. Martin                      executive officer)                                     
                                                                               
                                                                                            
                                          


 /s/ William H. Parsons                   Chief Financial Officer              May 6, 1997
----------------------------------        and Director                 
     William H. Parsons                   (principal financial officer)
                                          


*/s/ Thomas W. Fife                       Director                             May 6, 1997
---------------------------------
     Thomas W. Fife


*/s/ Robert T. Knight                     Director                             May 6, 1997
----------------------------------
     Robert T. Knight


*By /s/ William H. Parsons
    ------------------------------
     William H. Parsons,
     Attorney-in-fact
</TABLE>
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                                  EXHIBIT INDEX

<TABLE>
<CAPTION>

    NO.                  DESCRIPTION                                                      PAGE NO.
    ---                  -----------                                                      --------
<S>       <C>                                                                             <C>
    3.1   Certificate of Incorporation and all amendments thereto*
    3.2   Second Amended and Restated Bylaws
    4.1   Form of Common Stock Certificate*
    4.2   See Exhibits 3.1 and 3.2 for provisions in the Certificate of Incorporation
          and Second Amended and Restated Bylaws of the Company defining the rights
          of the holders of Common Stock
   10.1   1988 Incentive Stock Option Plan and 1988 Nonstatutory Stock Option Plan*
   10.2   1997 Stock Option Plan
   10.3   Lease Agreement For Registrant's Facilities in Bellevue, Washington                
   21.1   Subsidiaries                                                                       
   23.1   Consent of Independent Certified Public Accountants                                
   24.1   Power of Attorney of Thomas W. Fife                                                
   24.2   Power of Attorney of Robert T. Knight                                              
   27.    Financial Data Schedule
</TABLE>

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*        Incorporated by reference to the Registration Statement on Form SB-2
         (Reg. No. 333-841) filed by the Company on February 9, 1996.