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,  2002

                                       or

[ ]  TRANSITION  REPORT  PURSUANT  TO  SECTION  13 OR 15(D) OF THE SECURITIES
     EXCHANGE  ACT  OF  1934
     For  the  transition  period  from  ______  to  ______

     Commission  file  number:   0-27432
                               ------------


                        CLEAN DIESEL TECHNOLOGIES, INC.
             (Exact name of registrant as specified in its charter)

          Delaware                                           06-1393453
          --------                                           ----------
   (State of Incorporation)                               (I.R.S. Employer
                                                         Identification No.)

Clean Diesel Technologies, Inc.
300 Atlantic Street - Suite 702
Stamford, CT                                                 06901-3522
(Address of principal executive offices)                     (Zip Code)

                                 (203) 327-7050
              (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 and (2) has been subject to such filing requirements for
the  past  90  days.

                                 Yes  X     No
                                     ---       ---

As of August 13, 2002, there were outstanding 11,241,379 shares of Common Stock,
par  value  $0.05  per  share,  of  the  registrant.


================================================================================


<PAGE>
                        CLEAN DIESEL TECHNOLOGIES, INC.

                  Form 10-Q for the Quarter Ended June 30, 2002

                                      INDEX


                                                                            Page
                                                                            ----
PART I.  FINANCIAL INFORMATION

Item 1.     Financial Statements (Unaudited)

            Balance Sheets as of June 30, 2002,                              3
            and December 31, 2001

            Statements of Operations for the Three and Six                   4
            Months Ended June 30, 2002 and 2001

            Statements of Cash Flows for the Six                             5
            Months Ended June 30, 2002 and 2001

            Notes to Financial Statements                                    6

Item 2.     Management's Discussion and Analysis of                          9
            Financial Condition and Results of Operations


PART II.    OTHER INFORMATION

Item 1.     Legal Proceedings                                               12
Item 2.     Changes in Securities                                           12
Item 3.     Defaults upon Senior Securities                                 12
Item 4.     Submission of Matters to a Vote of Security Holders             12
Item 5.     Other Information                                               12
Item 6.     Exhibits and Reports on Form 8-K                                12


SIGNATURES                                                                  13


                                      -2-
<PAGE>
PART  I.     FINANCIAL  INFORMATION
Item  1.     Financial  Statements

<TABLE>
<CAPTION>
                        CLEAN DIESEL TECHNOLOGIES, INC.

                                 BALANCE SHEETS

                                              (in thousands except share data)

                                                  June 30,     December 31,
                                                    2002           2001
                                                ------------  --------------
                                                (Unaudited)
<S>                                             <C>           <C>
ASSETS
Current assets:
Cash and cash equivalents                       $     2,147   $       4,023
Accounts receivable                                      16             197
Inventories                                             304             296
Other current assets                                     89              96
                                                ------------  --------------
Total current assets                                  2,556           4,612
Other assets                                            110              46
                                                ------------  --------------
Total assets                                    $     2,666   $       4,658
                                                ============  ==============

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable                                   $        --   $         250
Accounts payable and accrued expenses                   173             558
                                                ------------  --------------
             Total current liabilities                  173             808

Deferred compensation and pension benefits              393             368
                                                ------------  --------------
              Total long term liabilities               393             368

Stockholders' equity:
Preferred stock, par value $.05 per share,
  authorized 80,000 shares, no shares issued
  and outstanding                                        --              --
Series A convertible preferred stock, par
  value $.05 per share, $500 per share
  liquidation preference, authorized 20,000
  shares, no shares issued and outstanding               --              --
Common stock, par value $0.05 per share,
  authorized 15,000,000 shares, issued and
  outstanding 11,241,379 and 11,214,280 shares          562             561
Additional paid-in capital                           27,198          27,058
Accumulated deficit                                 (25,660)        (24,137)
                                                ------------  --------------
Total stockholders' equity                            2,100           3,482
                                                ------------  --------------
Total liabilities and stockholders' equity      $     2,666   $       4,658
                                                ============  ==============
</TABLE>

See  notes  to  financial  statements.


                                      -3-
<PAGE>
<TABLE>
<CAPTION>
                              CLEAN DIESEL TECHNOLOGIES, INC.
                                  STATEMENTS OF OPERATIONS
                                        (Unaudited)

                                                (in thousands except per share data)


                                             Three Months Ended        Six Months Ended
                                                   June 30,                June 30,
                                              2002         2001        2002        2001
                                           -----------  -----------  --------  ------------
<S>                                        <C>          <C>          <C>       <C>

Revenue:
Product revenue                            $       15   $       75   $    76   $        88
License and royalty revenue                         4          844        14           855
                                           -----------  -----------  --------  ------------
Total revenue                                      19          919        90           943

Costs and expenses:
Cost of sales                                      12           51        55            58
General and administrative                        577          450     1,135           885
Research and development                          300           91       412           176
Patent filing and maintenance                      --           53        27           100
                                           -----------  -----------  --------  ------------

Income/(loss) from operations                    (870)         274    (1,539)         (276)
Interest income                                    10            3        25             6
Interest expense                                   --          (26)       (9)          (37)
                                           -----------  -----------  --------  ------------

Net Income/(loss) before preferred stock
  dividend                                       (860)         251    (1,523)         (307)
Preferred stock dividend (non-cash)                --         (207)       --          (409)
                                           -----------  -----------  --------  ------------

Net Income/(Loss) attributed to common
  stockholders                             $     (860)  $       44   $(1,523)  $      (716)
                                           ===========  ===========  ========  ============

Basic Income/(loss) per common
  share                                    $    (0.08)  $     0.02   $ (0.14)  $     (0.27)
                                           ===========  ===========  ========  ============

Diluted Income/(loss) per common
  share                                    $    (0.08)  $     0.01   $ (0.14)  $     (0.27)
                                           ===========  ===========  ========  ============

Weighted average number of common shares
  outstanding - basic                          11,241        2,693    11,228         2,680
                                           ===========  ===========  ========  ============

Weighted average number of common shares
  outstanding - diluted                        11,241        8,235    11,228         2,680
                                           ===========  ===========  ========  ============
</TABLE>

See  notes  to  financial  statements.


                                      -4-
<PAGE>
<TABLE>
<CAPTION>
                        CLEAN DIESEL TECHNOLOGIES, INC.

                            STATEMENTS OF CASH FLOWS
                                  (Unaudited)


                                                        (in thousands)

                                                       Six Months Ended
                                                           June 30
                                                       2002        2001
                                                     ---------  -----------
<S>                                                  <C>        <C>

OPERATING ACTIVITIES
Net loss before preferred stock dividend             $ (1,523)  $     (307)
Adjustments to reconcile net loss to cash used in
  operating activities:
  Depreciation and  amortization                           10            5
  Amortization of deferred financing cost                   8           35
  Compensatory stock warrants                              95           --
Changes in operating assets and liabilities:
  Accounts receivable                                     181         (371)
  Inventories                                              (8)          62
  Other current assets                                     7           21
  Accounts payable and accrued expenses                  (314)         (30)
                                                     ---------  -----------

Net cash used in operating activities                  (1,544)        (585)
                                                     ---------  -----------

FINANCING ACTIVITIES
Proceeds from exercise of stock options                    --            3
Proceeds/(repayment) of term loan                        (250)         500
                                                     ---------  -----------

Net cash (used in) provided by financing activities      (250)         503
                                                     ---------  -----------

INVESTING ACTIVITIES
Patent costs                                              (48)          --
Purchase of fixed assets                                  (34)          (2)
                                                     ---------  -----------
Net cash used in investing activities                     (82)          (2)
                                                     ---------  -----------
NET DECREASE IN CASH AND CASH EQUIVALENTS              (1,876)         (84)
                                                     ---------  -----------
Cash and cash equivalents at beginning of period        4,023          541
                                                     ---------  -----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD           $  2,147   $      457
                                                     =========  ===========

NON-CASH ACTIVITIES

Preferred stock dividend                                   --          409
</TABLE>

See  note  to  financial  statements.


                                      -5-
<PAGE>
                         CLEAN DIESEL TECHNOLOGIES, INC.

                          NOTES TO FINANCIAL STATEMENTS
                                  June 30, 2002
                                  (Unaudited)

BASIS  OF  PRESENTATION

     The  accompanying  unaudited,  consolidated  financial statements have been
prepared  in  accordance  with  accounting  principles generally accepted in the
United  States  for  interim  financial information and with the instructions to
Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all
of  the  information  and  footnotes required by accounting principles generally
accepted  in the United States for complete financial statements. In the opinion
of management, all adjustments considered necessary for a fair presentation have
been  included. All such adjustments are of a normal recurring nature. Operating
results  for  the  six-month  period  ended  June  30, 2002, are not necessarily
indicative  of the results that may be expected for the year ending December 31,
2002.  For  further information, refer to the Financial Statements and footnotes
thereto  included  in  the  Company's  Form 10-K for the year ended December 31,
2001.

     Clean  Diesel  Technologies, Inc. (the "Company" or "CDT") was incorporated
in  the  State  of Delaware on January 19, 1994, as a wholly owned subsidiary of
Fuel-Tech  N.V. ("Fuel Tech").  Effective December 12, 1995, Fuel Tech completed
a  Rights Offering of the Company's Common Stock that   reduced its ownership in
the  Company to 27.6%. Fuel Tech currently holds a 16.3% interest in the Company
as  of  June  30,  2002.

     The Company is a specialty chemical and energy technology company supplying
fuel  additives  and  proprietary  systems  that  reduce  harmful emissions from
internal  combustion  engines  while improving fuel economy.  Prior to 2000, the
Company was a development stage enterprise devoted to research, development, and
commercialization  of  platinum  fuel  catalysts (PFCs) and Nitrogen Oxide (NOx)
reduction  technologies  for  diesel engines.  During December 1999, the Company
received its EPA registration for its platinum - cerium product and recorded its
first  commercial  sales.  Accordingly, in the opinion of management the Company
was  no  longer  a  development  stage enterprise.  The success of the Company's
technologies  will  depend  upon  the  commercialization  opportunities  of  the
technologies  and  governmental regulations, and corresponding foreign and state
agencies.

     Prior  to  2000,  the  Company  was  primarily  engaged  in  research  and
development  and  has  incurred  losses  since  inception  totaling  $20,908,000
(excluding  non-cash  preferred  stock dividends).  In management's opinion, the
Company's cash balance at June 30, 2002 will be sufficient to fund the Company's
operations  through the second quarter 2003.  The Company may require additional
capital  to  fund its future operations and working capital needs.  Although the
Company  believes  that  it  would  be successful in raising additional capital,
there  is  no  guarantee  that it will be able to raise such funds on terms that
will be satisfactory to the Company.  The Company will develop contingency plans
in  the  event  future  financing  efforts  are  not successful.  Such plans may
include  reducing  expenses  and  selling  or  licensing  some  of the Company's
technologies.

INVENTORIES

     Inventories  are  stated  at  the  lower  of  cost or market and consist of
finished  product.  Cost  is  determined  using  the  first-in, first-out (FIFO)
method.

INTANGIBLE  ASSETS

     In  fiscal  year 2002, the Company began capitalizing the costs of patents.
Patents  include costs to secure patents on technology developed by the Company.
Patents  are  amortized on a straight-line basis over the remaining useful lives
of  three  to  eighteen  years.  Patents  are evaluated for potential impairment
whenever  events  or circumstances indicate that undiscounted cash flows are not
sufficient  to  recover  their  carrying  amounts.


                                      -6-
<PAGE>
REVENUE  RECOGNITION

     The  Company  recognizes  revenue  from  sales  of Platinum Plus fuel borne
catalyst  and  ARIS  2000  systems  upon  shipment.

     In  April  2001,  the Company amended its February 2000 ARIS Stationary NOx
Reduction  license  agreement with the RJM Corporation.  Under the amended terms
of the license agreement, the Company received two fixed non-refundable payments
of  $412,500  each  on  June  1 and September 1 in lieu of potentially receiving
$1,040,000  on  the  second  or  third  anniversary.  The Company recognized the
$825,000 as license revenue in 2001.  The Company receives unit royalties on all
ARIS  sales  of  stationary,  marine  or  locomotive  applications  by  RJM.

     In August 2001, the Company completed a license agreement with Mitsui & Co.
Ltd  for  CDT's  ARIS  2000  NOx  control system for all stationary diesel power
generators  in Japan. Under the agreement, the Company received a non-refundable
upfront license payment of $495,000, and will receive ongoing standard royalties
on  each  system  sold  by Mitsui. The Company recognized the license payment as
revenue  in  2001, as there were no significant ongoing services to be performed
by  the  Company.  Mitsui  also has an option to license the ARIS technology for
mobile  applications  in  Japan  for  an  additional  license  fee.

     Royalty  fees  are  recognized  by  the  Company  when  earned.

NOTES  PAYABLE

     In  November  2000,  the Company arranged a $1,000,000 term loan with three
private  lenders.  The term loan had a 10% interest rate and was payable in full
on  May  14,  2002.  The  Company  drew  down  $500,000 in November 2000 and the
remaining  $500,000  in  March  of 2001.  As part of the private placement stock
transaction in December 2001, $750,000 of the outstanding term loan plus accrued
interest  was  converted to common stock.  The remaining $250,000 portion of the
term  loan  plus  accrued  interest  was  paid  in  cash  on  January  18, 2002.

STOCKHOLDERS'  EQUITY

     During  December 2001, the Company received proceeds of $3.721 million (net
of  $0.644  million  in  expenses  and  $0.817  million in term loan re-payment)
through  private  placements  of  2,580,664  of  its Common Stock.  In 2000, the
Company  received  $1.021  million through private placements of 1,362 shares of
its  Series  A  Preferred  Stock.  In addition, in 1999 $1.75 million was raised
through  a  private  placement  of  3,500 Series A preferred stock shares and in
1998, $1.4 million of bridge loans and $0.5 million of term loans were converted
into  2,800  and  1,029  shares  of  Series  A  Preferred  Stock.

     During  2001,  $1,897,000 of non-cash stock dividend and conversion premium
were  declared for the Series A preferred stock and converted into the Company's
Common Stock. On December 28, 2001, the Company converted all outstanding Series
A Preferred Stock (15,897 shares) including accrued stock dividends, into Common
Stock  (5,934,829  shares).

EARNINGS  PER  SHARE

     Employee stock options and stock purchase warrants were not included in the
computation  of diluted earnings  per share for 2002, because either the Company
reported  a  loss  for the period or their exercise prices were greater than the
average  market  price  of the common stock and therefore would be antidilutive.

RELATED  PARTY  TRANSACTIONS

     In  November 2000, the Company secured a $1,000,000 term loan facility at a
10%  interest rate from several preferred shareholders, including Fuel Tech Inc.
which  pledged  $250,000.   In  2000  and  2001 the Company drew down the entire
$1,000,000  term  loan.  In  December  2001,  $750,000  of term loan and accrued


                                      -7-
<PAGE>
interest  was  repaid  as  part of the December 2001 private placement of common
stock  discussed in the stock holders equity note.  In January 2002, the Company
repaid  the  remaining $250,000 term loan payable to Fuel Tech Inc. plus accrued
interest.

     The  Company  has a Management and Services Agreement with Fuel Tech. Under
the  agreement,  the Company pays Fuel Tech a fee equal to an additional 3 - 10%
of  the  costs  paid  on  the Company's behalf, dependent upon the nature of the
costs  incurred.  Currently,  a fee of 3% is assessed on all costs billed to the
Company from Fuel Tech.  Charges to the Company, inclusive of the administrative
fee,  were  approximately  $17,300  in both the second quarter of 2002 and 2001.

COMMITMENTS

     Effective  October  28, 1994, Fuel Tech granted two licenses to the Company
for  all  patents  and  rights  associated  with  its  platinum  fuel  catalyst
technology.   Effective  November  24, 1997, the licenses were canceled and Fuel
Tech  assigned to the Company all such patents and rights on terms substantially
similar  to  the  licenses. In exchange for the assignment, the Company will pay
Fuel  Tech  a  royalty  of  2.5%  of  its annual gross revenue from sales of the
platinum  fuel  catalysts  commencing in 1998. The royalty obligation expires in
2008.  The  Company may terminate the royalty obligation to Fuel Tech by payment
of  $7,636,364 in 2002 and declining annually to $1,090,910 in 2008. The Company
as  assignee and owner will maintain the technology at its own expense. The 2001
royalties of $2,673 were paid to Fuel Tech in 2002 and royalties payable to Fuel
Tech  at  June  30,  2002  were  $425.

MARKETING  AND  LICENSE  AGREEMENTS

     In  March 2001, the Company licensed the Lubrizol Corporation to distribute
and blend the Company's patented Platinum Plus fuel borne catalyst in Europe for
use  with  particulate  filters.  The  seven  year  exclusive agreement includes
minimum  annual  sales  performance  requirements.

     In  June  2001  the  Company announced a non-exclusive distribution license
agreement  with  Baker  Petrolite,  a division of Baker Hughes.  Baker Petrolite
will  distribute CDT's patented Platinum Plus diesel fuel combustion catalyst to
refineries  and  fuel  terminals  in  the  U.S.  and  Canada.

     In August 2001, the Company completed a license agreement with Mitsui & Co.
Ltd  for  CDT's  ARIS  2000  NOx  control system for all stationary diesel power
generators  in  Japan.  Under the agreement, the Company received non-refundable
upfront license payments of $495,000 and will receive ongoing standard royalties
on  each  system  sold by Mitsui.  Mitsui also has an option to license the ARIS
technology  for  mobile  applications  in  Japan  for an additional license fee.

     In  September  2001,  the  Company  signed  a license agreement with Global
Companies  LLC  for  bulk  treatment  of diesel fuel with the Platinum Plus fuel
additive.  Global  Companies  LLC  of Waltham, MA will be the exclusive terminal
blender  of the Platinum Plus diesel fuel combustion catalyst in New England for
delivery  to  select  fuel  marketers  and  fleet  customers.


                                      -8-
<PAGE>
                        CLEAN DIESEL TECHNOLOGIES, INC.


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


FORWARD-LOOKING  STATEMENTS

     Statements  in  this  Form  10-Q  that  are not historical facts, so-called
"forward-looking statements," are made pursuant to the safe harbor provisions of
the  Private  Securities Litigation Reform Act of 1995.  Investors are cautioned
that  all  forward-looking statements involve risks and uncertainties, including
those  detailed  in  the  Company's  filings  with  the  Securities and Exchange
Commission.  See  "Risk Factors of the Business" in Item 1, "Business," and also
Item 7, "Management's Discussion and Analysis of Financial Condition and Results
of  Operations" in the Company's Form 10-K for the year ended December 31, 2001.


RESULTS  OF  OPERATIONS

     Prior  to  2000,  the  Company  was  a development stage enterprise and its
efforts  were  devoted  to  the  research,  development and commercialization of
platinum  fuel  catalysts  and  nitrogen  oxide reduction technologies to reduce
emissions  from  diesel engines.  During December 1999, the Company received its
US  EPA registration for its platinum-cerium fuel catalyst product and completed
its  first  commercial  sales.

     Product  sales  and cost of sales were $15,000 and $12,000 respectively for
the  second  quarter of 2002 versus $75,000 and $51,000 for 2001.  Platinum Plus
fuel catalyst sales of $5,000 and $72,000 were recorded in the second quarter of
2002 and 2001, respectively.  ARIS product sales of $10,000 were recorded in the
second  quarter  of  2002.

     Included  in  the  2002  and  2001  second  quarter  revenue  is $4,000 and
$844,000,  respectively,  of license and royalty income from the RJM Corporation
for  the  ARIS  2000 NOx reduction technology.  In 2001, CDT received a one-time
license  payment from RJM for $825,000.  CDT earns a royalty on all RJM sales of
the  ARIS  2000  system.

     Year-to-date  sales  and  cost  of  sales  were $90,000 and $55,000 in 2002
versus  $943,000        and $58,000 in 2001.  Included in the total year revenue
is  $14,000  and  $855,000 of ARIS license and royalty revenue for 2002 and 2001
respectively.  Year-to-date Platinum Plus FBC sales for 2002 were $17,000 versus
$85,000  in  2001.

     General  and  administrative expenses increased $127,000 to $577,000 in the
second  quarter  2002 versus $450,000 in the same period of 2001.  For the first
six  months  of  2002  general and administrative expenses increased $250,000 to
$1,135,000  versus  $885,000  in  2001.  The  rise in spending is related to the
hiring  of  a  Vice President of Sales and Marketing in April 2002, increases in
salaries  and  marketing  related costs associated with the commercialization of
the Platinum Plus FBC.  The 2002 year-to-date general and administrative expense
also  includes  a  one-time  $95,000  non-cash  charge  for  additional  2001
compensatory  stock  warrant  expense  to  a  third  party.

     Research  and  development  expenses increased $209,000 to $300,000 in 2002
versus  $91,000  in  the  comparable  period  in 2001. For the year research and
development  costs are up       $236,000 to $412,000 versus $176,000 in the same
period  in  2001.  The  increase  is  attributable  to  the  start  of  several
verification  and  certification  programs  for  the  Platinum  Plus  FBC.

     Patent  filing  costs decreased $53,000 to $0 in the second quarter of 2002
versus  $53,000  in  the  comparable  2001 period.  During the second quarter of
2002,  the  Company  began  capitalizing its patent costs and will amortize such


                                      -9-
<PAGE>
costs  over  the  life  of  the  related  patent.  For  the year patent cost has
decreased  $73,000  to $27,000 versus a $100,000 in the same six month period in
2001.

     Second  quarter  interest income increased $7,000 in 2002 to $10,000 versus
$3,000 in the comparable period in 2001.  For the year interest income increased
$19,000  to  $25,000 versus $6,000 in the same period in 2001. This was a result
of  an increase in the amount of cash and cash equivalents on hand in 2002.  For
the  year  interest  expense  declined  to  $9,000 from $37,000 in the first six
months  of 2001 as the result of the repayment of the term loan in January 2002.


LIQUIDITY  AND  SOURCES  OF  CAPITAL

     Prior  to  2000,  the  Company  was  primarily  engaged  in  research  and
development  and  has  incurred  losses since inception aggregating $ 20,908,000
(excluding the effect of the preferred stock dividends).  The Company expects to
incur  losses  through  the  foreseeable  future  as  it  further  pursues  its
commercialization  efforts.  Although  the  Company  started  selling  limited
quantities  of product in 1999 and licensing revenue in 2000 and 2001, sales and
revenue  to  date  have  been  insufficient to cover operating expenses, and the
Company  continues to be dependent upon sources other than operations to finance
its  working  capital  requirements.

     For  the  six months ended June 30, 2002 and 2001, the Company used cash of
$1,544,000  and  $585,000  respectively,  in  operating  activities.

     At  June  30,  2002  and  December  31, 2001, the Company had cash and cash
equivalents  of  $2,147,000  and $4,023,000, respectively.  The decrease in cash
and  cash  equivalents  in  2002  was  the  result of payments made for expenses
related  to  the  stock offering in December 2001, various product certification
programs  and  the  normal  on-going  operations  of  the  Company.  The Company
anticipates  incurring  additional  losses  through  at least 2002 as it further
pursues  its  commercialization  efforts.

     The  Company  signed  an  agreement with the RJM Corporation on February 2,
2000  which  licensed  RJM  to  sell  CDT's ARIS 2000 NOx control system for all
stationary,  marine,  and  locomotive  applications in North, Central, and South
America.  Under  terms of the agreement CDT received an initial $360,000 license
fee  and  inventory  payment.

     In  April  2001,  the Company amended its February 2000 ARIS Stationary NOx
Reduction  license  agreement with the RJM Corporation.  Under the amended terms
of the license agreement, the Company received two fixed non-refundable payments
of  $412,500  each  on  June  1 and September 1 in lieu of potentially receiving
$1,040,000  on  the  second or third anniversary of the license agreement.   The
Company  will  continue to receive unit royalties on future sales of stationary,
marine  or  locomotive  applications  by  RJM.

     In  August  2001, the Company completed a license agreement with Mitsui for
CDT's ARIS 2000 NOx control system for all stationary diesel power generators in
Japan.  Under the agreement, the Company received non-refundable upfront license
payments  of $495,000 and will receive ongoing standard royalties on each system
sold  by  Mitsui.  Mitsui  also has an option to license the ARIS technology for
mobile  applications  in  Japan  for  an  additional  license  fee.

     In  November 2000, the Company secured a $1,000,000 privately financed term
loan  facility.  In  December  2000,  the Company drew down $500,000 of the term
loan  facility  and  in  March  2001 the remaining $500,000 of the term loan was
drawn  down.  As  part  of  the  private placement stock transaction in December
2001,  $750,000 of the outstanding term loan plus accrued interest was converted
to  common stock.  The remaining $250,000 plus accrued interest was paid in cash
in  January  2002.

     In  December 2001, the Company received $3.721 million (net of expenses and
term  loan  repayment)  through  a  private placement of 2,580,664 shares of its
common  stock.  In conjunction with the private placement, the Company converted


                                      -10-
<PAGE>
all  of  its  Series  A  Preferred  Stock to Common Stock.  All of the Company's
Common  Stock  shares  were  registered  to trade on the AIM of the London Stock
Exchange.

     As  a  result  of the Company's recurring operating losses, the Company has
been  unable  to  generate  a  positive cash flow.  In management's opinion, the
Company's cash balance at June 30, 2002 will be sufficient to fund the Company's
operations  through the second quarter 2003.  The Company may require additional
capital  to  fund  its future operations.  Although the Company believes that it
will be successful in its capital-raising efforts, there is no guarantee that it
will  be  able  to  raise  such  funds on terms that will be satisfactory to the
Company.  The  Company  will  develop  contingency  plans  in  the  event future
financing  efforts are not successful.  Such plans may include reducing expenses
and  selling  or  licensing  some  of  the  Company's  technologies.


QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT  MARKET  RISK

     In  the  opinion  of  management,  with  the  exception  of  exposure  to
fluctuations  in  the  cost  of  platinum,  the  Company  is  not subject to any
significant  market  risk  exposure.

     The  Company  generally  receives all income in United States dollars.  The
Company  typically  makes  several  small  payments  monthly  in various foreign
currencies  for patent expenses, product tests and registration, local marketing
and  promotion  and  consultants.


                                      -11-
<PAGE>
PART  II.    OTHER INFORMATION

Item  1.     Legal Proceedings
             None

Item  2.     Changes in Securities and Use of Proceeds
             None

Item  3.     Defaults upon Senior Securities
             None

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

     At  the  annual  meeting  of  the Company, held on June 11, 2002, 7,109,426
common  shares,  par  $0.05  per  share,  or 63.4% of the issued and outstanding
common  shares  of the Company as of the record date, were represented in person
or  by  proxy,  and:

     (i)  The proposal to elect the five nominees as directors was approved by a
vote  with  respect  to  each  individual  nominee,  as  follows:

                                    Shares             Shares
          Name                       For              Withheld
          ----                       ---              --------

     John A. de Havilland          7,106,826           2,600
     Derek R. Gray                 7,106,826           2,600
     Charles W. Grinnell           7,106,826           2,600
     Jeremy D. Peter-Hoblyn        7,106,826           2,600
     James M. Valentine            7,106,826           2,600

     (ii)  The  proposal  to ratify and approve the appointment of Ernst & Young
LLP  as  independent auditors of the Company for the year 2002 was approved by a
vote  of  shares  7,108,426  cast  for,  1,000  against  and  none  abstaining.

     (iii)  The  proposal to approve the amendment of the 1994 Incentive Plan of
the  Company  to  provide  for  Incentive  Stock  Options  as  an alternative to
Non-Qualified  Options  was  approved  by  a  vote of 7,054,222 shares cast for,
54,943  against  and  261  abstaining.


Item  5.     Other  Information
             None

Item  6.     Exhibits  and  Reports  on  Form  8-K
             a.  Exhibits
             None


                                      -12-
<PAGE>
                        CLEAN DIESEL TECHNOLOGIES, INC.
                          SIGNATURES & CERTIFICATIONS



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.

The  Undersigned  in  their  capacities  as  Chief  Executive  Officer and Chief
Financial  Officer  of  the  Registrant  do  hereby  certify  that:

     (i)  This  report  fully complies with the requirements of Section 13(a) or
          15(d)  of  the  Securities  Exchange  Act  of  1934;  and

     (ii) Information  contained  in the report fairly presents, in all material
          respects,  the  financial  condition  and results of operations of the
          Registrant  as  of,  and  for,  the  periods  presented in the report.





Date:  August  13,  2002                By: /s/ Jeremy  D.  Peter-Hoblyn
                                            ------------------------------------
                                            Jeremy D. Peter-Hoblyn
                                            Chairman, Director and
                                            Chief Executive Officer



Date:  August  13,  2002                By: /s/ David  W.  Whitwell
                                            ------------------------------------
                                            David W. Whitwell
                                            Chief Financial Officer,
                                            Vice President and Treasurer


                                      -13-
<PAGE>