SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                  FORM 10-K

(Mark One)
[X]  Annual report pursuant to section 13 or 15(d) of the Securities Exchange
     Act of 1934 [NO fee required]

     For the fiscal year ended: March 31, 2000

[ ]  Transition report pursuant to section 13 or 15(d) of the Securities
     Exchange Act of 1934.

                        Commission File Number: 0-8125
                            _____________________

                           DETECTION SYSTEMS, INC.
            (Exact name of registrant as specified in its charter)

State of New York                                                   16-0958589
(State or other jurisdiction                                  (I.R.S. Employer
of incorporation or organization)                       Identification Number)

                130 Perinton Parkway, Fairport, New York 14450
             (Address of principal executive offices) (Zip Code)

                                (716) 223-4060
             (Registrant's telephone number, including area code)
                            _____________________

       Securities registered pursuant to Section 12(b) of the Act: None
                            _____________________

         Securities registered pursuant to Section 12(g) of the Act:

                    Common Stock, Par Value $.05 Per Share
                               (Title of Class)

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
the filing requirements for the past 90 days.  Yes   x    No _____

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [x]

As of June 2 the aggregate market value of the voting stock held by
non-affiliates of the registrant was approximately $53,800,000.  On this date
the aggregate market value of all voting stock was approximately $60,392,000.

As of June 2 there were outstanding 6,364,000 shares of the registrant's
common stock, par value $.05 per share.

                     DOCUMENTS INCORPORATED BY REFERENCE

Proxy Statement for 2000 Annual Meeting of Shareholders -- See Part III of
this Form 10-K Annual Report for portions incorporated by reference.

PART I

ITEM l.  BUSINESS

GENERAL

The Company is a supplier of equipment to the electronic protection
industry.  The Company designs, manufactures and markets electronic
detection, control and communication equipment for security, fire protection,
access control and closed circuit television ("CCTV") applications, offering
products primarily for the commercial and mid- to high-end residential
portions of the market.  From its founding in 1968 until 1995, the Company
was primarily a niche provider of intrusion detection devices for the
domestic market.  In 1995, the Company adopted a strategy designed to expand
its product offerings, establish an international sales presence, increase
its manufacturing capacity and improve its overall cost structure.  The
Company has since made ten acquisitions, opened six sales offices and
established a manufacturing facility in Asia.  These initiatives have enabled
the Company to expand its product catalog and market reach and to increase
its net sales from $34,336,000 in fiscal 1995 to $141,917,880 in fiscal 2000.

The Company manufactures system components for sale to electronic protection
installation and service companies, distributors and other equipment
manufacturers either as individual components or, increasingly, bundled with
other compatible components to form an integrated system for a specific
customer's application.  The Company is not engaged in the installation or
monitoring aspects of the industry.  The Company now offers products in all
four of the principal categories of the electronic protection equipment
market: security, fire, access control and CCTV.

ACQUISITIONS

The scale and product scope of the Company has increased as a result of its
acquisitions, beginning with the February 1996 acquisition of Radionics, Inc.
("Radionics").  These acquisitions have also helped the Company broaden its
catalog and expand its domestic and international distribution network.  A
summary of the Company's ten acquisitions is as follows:

RADIONICS.  In February 1996 the Company acquired all of the outstanding
stock of Radionics.  Radionics had annual net sales of approximately
$45,000,000 prior to its acquisition.  This acquisition gave the Company
access to Radionics' network of over 1,000 dealers.  Radionics had a number
of advanced products and models under development which have subsequently
been completed by the Company and used as the base for further product line
expansion.

SENSES.  In July 1996 the Company acquired certain assets of Senses
International, Inc. ("Senses"), a manufacturer of long-range wireless alarm
transmission equipment marketed under the name "Safecom."  Senses had annual
net sales of approximately $2,000,000 prior to its acquisition.  The Senses
product has been integrated into the Radionics product line.  This enables
Radionics to offer secure wireless alarm signaling capabilities.

DA SYSTEMS.  In May 1997 the Company acquired all of the outstanding stock of
Digital Audio Ltd. ("DA Systems"), a British manufacturer of security control
equipment with annual net sales of approximately $10,800,000 prior to its
acquisition.  DA Systems provides the Company with a line of controls and
communication devices approved for sale in the U.K.

SERIEE.  In June 1997, the Company acquired 99.5% of the outstanding stock of
Seriee S.A. ("Seriee").  Seriee is a French manufacturer of electronic
control and communications equipment with annual net sales of approximately
$6,300,000 prior to its acquisition.  Like the U.K., France has unique design
requirements and this acquisition provides the Company with a line of
French-approved control panels and a distribution network of eight offices
located throughout France.  Prior to its acquisition, Seriee was a
distributor for certain Company products.

RAS.  In June 1997, the Company acquired 98.7% of the outstanding stock of
Radio-active Systems N.V. ("RAS").  RAS, with five regional sales offices
throughout Belgium, had annual net sales of approximately $9,900,000 prior to
its acquisition.  RAS had been a distributor for the Company for over
15 years and, immediately prior to its acquisition, was the Company's second
largest distributor.

SECURITY SUPPLIES.  In November 1997, the Company purchased the assets of
Security Supplies NZ Ltd. ("Security Supplies").  Security Supplies is a New
Zealand distributor of security products with annual net sales of
approximately $800,000 prior to its acquisition.

EDM.  In January 1998, the Company acquired all of the outstanding stock of
Electronics Design and Manufacturing Pty Limited ("EDM").  With annual net
sales of approximately $4,600,000 prior to its acquisition, EDM is one of the
largest Australian manufacturers of residential and commercial control
panels.  The acquisition of EDM, combined with the Company's existing
distribution operations, gives the Company a comprehensive catalog and sales
presence in the Australian market.

EFSEC.  In June 1998, the Company acquired all of the outstanding stock of
Efsec AB ("Efsec").  Efsec is a Swedish distributor of electronic security
equipment and had annual net sales of approximately $3,000,000 prior to its
acquisition.

ALARM CENTER.  In June 1998, the Company acquired all of the outstanding
stock of Alarm Center Kft ("Alarm Center").  Alarm Center is a Hungarian
distributor of electronic security equipment and had annual net sales of
approximately $500,000 prior to its acquisition.

CAETEC.  During the second quarter ended September 30, 1999, the Company
acquired all of the outstanding shares of Caetec S.r.l. ("Caetec") for
approximately $700,000 in cash.  Caetec is an Italian technology company with
a line of fire control products.

PRODUCT LINE

The Company produces and distributes a wide variety of electronic protection
equipment, offering a single source of products to the professional
installers who provide custom systems for different types of buildings and
protection requirements.

The Company continues to expand its product line through internal research
and development activities, acquisition of companies with desired
technologies and partnerships with businesses that have technological
capabilities that complement the Company's internal capabilities.

Security Products

Security systems consist of intrusion detectors coupled with control and
communications equipment and, in many cases, notification devices.  When a
triggering event occurs, a detector senses the event and notifies the control
equipment, which in turn causes the communications equipment to transmit an
alarm signal to an on-premise monitoring location or a remote central alarm
monitoring service.  The control equipment also activates notification
devices such as strobes, horns and sirens if these options are features of
the system.

Detectors.  Security detectors are the components of a security system which
sense intrusion into protected areas.  The Company markets security detectors
under a number of brand names, including: Detection Systems, Radionics, and
Seriee.  Security detectors differ in three primary respects: the way they
sense intrusion or another alarm condition, the way they communicate with
control equipment and the type of information they transmit to the control
equipment.

The Company offers detectors which use a number of different technological
approaches for sensing the existence of an intrusion or other alarm
condition, including: passive infrared body heat detection, combination
passive infrared and microwave detection ("dual detectors"), combination
passive infrared and camera, photoelectric beam interruption, acoustic glass
break detection, vibration detection, and magnetic contacts,

These different types of detectors are needed for different types of
applications in commercial and mid- to high-end residential security systems
and complement each other in their system applications and the types of
environments in which they function best.  Many alarm systems incorporate
several different types of detectors to maximize the effectiveness of the
system.

Detectors can communicate with an alarm system's control equipment on a wired
or wireless basis or on a combined or "hybrid" basis (where the detector
communicates via wireless transmission to a peripheral device which is wired
to the control equipment).  The Company offers detectors which are used in
each of these types of systems.

The information that detectors communicate to the control equipment ranges
from a simple communication that an alarm event has occurred to, in a
multiplex system, the identity of the detector sensing the alarm condition,
the nature of the alarm condition and diagnostic information about the
detector.

Control Equipment.  The control components of a security system manage all
the functions of the system and provide the link between the system's
detectors and communication equipment.  The Company markets control products
under various brand names, including: Radionics, Detection Systems, Abacus,
EDM and Seriee.  The Company's control products include control panels which
collect, interpret and transmit the signals from the detectors as well as
arming stations which are used to program certain features of the system and
to arm and disarm it.  The Company's control and communication product
offerings were expanded in 1996 by its acquisition of Radionics, which is
well known in the industry for its alarm control and communication equipment.

The Company's security control product line includes products that are used
in all three types of systems installed by security professionals.
Conventional security systems include wired, wireless and hybrid (combination
wired and wireless) systems and communicate on which zone of detectors an
alarm condition exists.  In the next level, multiplex systems, each sensor is
addressable, which means that the specific identity of the device and the
location of the alarm condition is reported.  At the highest level, the
Company's advanced multiplex systems feature the capacity to report back
addressable test, diagnostic and alarm condition information, assuring that
the system is working properly, and to report whether a detector has been
tampered with.

The Company has a wide range of control panels, ranging from four-zone panels
which can operate four detection device circuits, to 246-zone fully
integrated security, fire and access control panel which can operate a
combination of up to 246 intrusion detection, smoke detection and access
control circuits and devices.

Communications Equipment.  The Company offers a broad line of communications
equipment, ranging from Radionics' central station receiving equipment, which
performs the function of receiving alarm signals from multiple sources, to
transmission equipment capable of accessing telephone lines, as well as some
of the alternative communication technologies which are commercially
available.  One of these technologies is BellSouth's Cellemetry(r) data
service, which permits wireless transmission of alarm signals to a central
station using existing cellular networks.  Another is the ARDIS radio
network, which offers a more secure alternative to telephone lines as the
means for contacting a central monitoring station, and ultimately the police
or fire department.  A third is LAN/WAN interface, which allows
communications over private data networks or the Internet.

In addition, the Company offers its Safecom long-range wireless alarm
transmission system which allows a monitoring company to establish and
maintain a proprietary two-way radio network to transmit and receive alarm
signals.

The Company, through its Radionics and DA Systems subsidiaries, is licensed
to manufacture and sell in the U.K. and U.S. derived channel communication
devices that transmit alarm signals over the unused bands of standard
telephone lines.  This allows alarm signals to be transmitted at the same
time a telephone line is being used for voice communications.

Integrated Systems.   The Company has introduced several products that
combine control and communication functionality in order to improve the
operating efficiency of electronic protection systems that encompass multiple
remote locations.  These products allow end-users to send and accept security
system data over local-area or wide-area networks or the Internet using
TCP/IP protocol.  They also enable end-users to control many aspects of
individual security systems installed at remote locations from one central
location and can integrate with CCTV and five alarm systems.  These products
use an open-architecture format, so they can be used to control the Company's
equipment as well as competitors' equipment.

Security Escort.  The Company's Security Escort product is a multiple user
help-call, man down or asset tracking system which allows a user to alert
appropriate security personnel as to the location, name or other special data
of a protected individual or asset by using transmitters of various sizes and
shapes.  Security Escort systems may be enabled to permit a user to trigger a
strobe and sound a siren as well.  The primary components of a Security
Escort system are a central command station which is monitored by security
personnel, a Microsoft Windows-based system software package, transceivers,
receivers and individual transmitters.  This system uses a digital
micro-cellular architecture which accommodates up to 16 million individual
user ID codes.

The Security Escort's advanced design features include: self-supervision of
the system's operational integrity by internally generating and monitoring
test transmissions; testing of transmitters by users; and system-generated
notices regarding system maintenance requirements.  Security Escort allows a
user to test the system and his or her transmitter at any time, from any
location and receive visual confirmation that both are functioning properly.
In addition, the system software provides for full archiving of all system
activity including victim tracking and alarm map recall.

Fire Products

Fire detection systems work in the same manner as security systems.  In fact,
many fire detection systems are operated in tandem with a security system by
the same control equipment.  Fire alarm systems range from conventional
systems, which can sense and signal a fire condition or non-condition, to
addressable systems, which permit identification of the triggered detector
within the system, and analog systems, which permit communication of
information regarding the condition of the environment at the detector
location.

The Company offers fire detection products under the brand names Detection
Systems, Radionics and Caetec.  The Company's fire detection product line,
which includes products for both residential and commercial applications,
features detection components, dedicated control panels, communication
equipment and notification devices.

Detectors.  The Company's fire detection components sense the presence of
smoke and heat by employing a variety of technologies, including beam smoke
detectors, photoelectric spot smoke detectors, ionization spot smoke
detectors and heat probes.  The Company's smoke detectors are differentiated
by a patented chamber which provides increased immunity to dust, which is the
leading cause of false fire alarms.  The Company also has a automatic test
and calibration feature which continuously senses and signals if dust or
other conditions cause the detector's sensitivity to deviate from its
acceptable range.

Control Equipment.  As described above, many of the Company's control panels
operate both security and fire alarm systems; however, some of the Company's
control panels are designed exclusively for operating fire alarm systems.
The Company originally entered the fire detection business as an extension of
the security products line by providing fire detection features and
accessories through the security control panel.  The Company has since
expanded its product offerings in the United States through the release of a
new line of fire control equipment and in Europe through the acquisition of a
company that specializes in developing fire control equipment.

Communication Equipment.  The technologies the Company's products provide for
communicating fire alarm signals are the same as those provided by its
security alarm communications equipment.

Notification Devices.  The Company distributes a full range of notification
devices such as strobes, horns and sirens which fully comply with the
Americans with Disabilities Act.  These products are distributed under the
Company's name.

Access Control Products

Electronic access control systems consist of equipment that can identify an
authorized individual and permit that person to enter a restricted area.
While intrusion control products protect the property when no one is on-site,
access control products protect the property while it is occupied.

Access control systems can be used on stand-alone basis or they can be fully
integrated with Radionics panels.  Stand-alone systems offered by the Company
can control a virtually unlimited number of users and doors.  The Company's
integrated access control systems can control up to eight doors and 1,000
users.  The Company distributes access control products on an OEM basis under
the brand names Readykey(r), Easikey(r), DS Entry and Radionics.  Access
control products sold by the Company include control systems, card readers,
cards and detector accessories.

CCTV Products

CCTV is a system of relaying video and audio signals from a camera to a
monitor or a recording device.  The term CCTV refers to a closed-circuit
system sending signals to select receivers as opposed to a system
broadcasting signals to the general public.  The Company distributes CCTV
products and offers its own CCTV products on an OEM basis as well as under
the brand names Radionics Vision and DS Vision primarily in Belgium and China
and very recently in the U.S.

These products consist of cameras, monitors, recorders, control units and
other accessories.  The Company distributes color and black-and-white as well
as both high and low resolution cameras and monitors.  Certain product
distributed under the Radionics Vision brand name includes digital video
capabilities.  This enables users to view and control cameras live from any
remote location.  It also allows users to view stored images or video files,
or transport these files into e-mail messages, all from remote locations.

MARKETING

The Company's primary customers are: (i) national and regional installation
and service companies; (ii) national distributors; and (iii) original
equipment manufacturers.  The Company has a sales force of approximately 143
representatives of which 41 are domestic and 102 are international.  The
Company's products are installed in industrial, commercial, institutional and
residential buildings, in both new and upgraded system installations.

Domestically, large regional and national accounts are supported directly by
regional sales and service managers.  The Company's sales managers provide
technical support to customers regarding system design, installation and
service.  The Company also conducts regular training programs for its
customers as well as technical seminars at national and regional trade
shows.  A call to the Company's toll-free sales number typically results in
same-day shipment of most standard products from one of two warehouses.  To
support the on-site installer or service person, toll-free lines connect
directly to the Technical Service Department.

The Company markets the Security Escort multiple user help-call system in
North America and in Australia.  While the system was initially designed for
the protection of individuals on college and university campuses, it is
suitable for many other applications and is now used in apartment complexes,
condominiums, retirement communities, hospitals, correctional facilities,
governmental facilities and manufacturing facilities.

The Company markets cctv products primarily in Belgium and China and is
rolling out an integrated line of CCTV products for the U.S. Market.

COMPETITION

The markets in which the Company operates are highly competitive.  The
Company's competitors include manufacturers of security and fire alarm
equipment from all over the world.  The Company believes its two major
competitors are Honeywell and Interlogix.  In addition, the Company may face
competition from new entrants into these markets and increased competition
from existing competitors.  A number of the Company's competitors have
substantially greater financial and other resources than the Company.  In
many cases the Company's smaller competitors are concentrated in one market
niche in the electronic protection industry, allowing them to concentrate
their resources in that niche.

The Company competes on the basis of providing superior value to customers
with respect to both products and services.  When selecting electronic
security equipment, professional installation and service companies consider
the breadth of products offered by manufacturers and distributors, product
performance and reliability, as well as the incorporation of advanced
technological features such as superior signal processing, automatic testing,
efficiency of delivery, ease of installation and service, sales and technical
support services and price.  There can be no assurance that the Company's
products and services will continue to be competitive and accepted by the
market in the future.

MANUFACTURING

The Company designs its products and prepares specifications for the
component parts used in its products.  The Company purchases certain
components from outside sources and then assembles them into finished
products.

The Company has manufacturing facilities in Fairport, New York; Zhuhai,
China; Slough, England; Lille, France and Sydney, Australia.  The Company is
ISO 9002 certified at its Fairport and Zhuhai locations.

The majority of the Company's manufacturing is now conducted in its China
facility.  These manufacturing operations, which commenced during fiscal
1996, are conducted in a 70,000 square foot manufacturing facility in Zhuhai,
People's Republic of China.  This facility is being expanded to 120,000
square feet.  The expansion is expected to be completed in August, 2000.  The
Company has completed the transfer of most of the manufacturing of DA Systems
products to the China facility. See Note 10 to the Consolidated Financial
Statements for further discussion of the Company's restructuring actions.
For further information concerning the Company's manufacturing operations in
China, see Sections entitled "Risk Factors," "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and "Forward
Looking Statements."

INTELLECTUAL PROPERTY

The Company has obtained over 55 patents related to its products.  While the
Company obtains patents as appropriate and considers certain of its patents
valuable, it does not believe any one of them by itself is crucial to the
successful conduct of its business.  The Company relies on a combination of
patents, licenses, trademark registrations, copyrights and confidentiality
agreements to protect its intellectual property.

RESEARCH AND DEVELOPMENT

The Company has continually placed significant emphasis on research and
development activities through internal efforts and partnering arrangements
with third parties.  The acquisitions of Radionics, Safecom, DA Systems,
Seriee, EDM and Caetec have provided additional technologies to those it
already possessed.  It is the Company's intent to continue with its
development efforts to keep pace with technological advances in the
electronic protection industries by either further internal efforts,
additional acquisitions, or partnering arrangements.  The Company expended
approximately $10,503,000, $8,507,000 and $8,579,000 on research and
development activities during 2000, 1999 and 1998, respectively.

BACKLOG

Backlog is not significant in the business of the Company.  In general,
orders are processed from inventory on a relatively current basis.  It is the
Company's goal to maintain four weeks of finished goods inventory for all
products in order to meet customer requirements.

YEAR 2000 ISSUES

The Company has implemented the necessary changes related to Year 2000
issues. Since January 1, 2000 the Company's mission critical internal
computer systems have continued to operate without exception and the Company
is not aware of product difficulties at any of our customer sites; however,
the Company continues to monitor potential year 2000 issues.  See discussion
regarding Year 2000 in "Management's Discussion and Analysis of Financial
Condition and Results of Operations."

SUPPLIERS

The Company purchases raw materials, components and certain finished goods
worldwide from numerous suppliers.  The majority of these materials are
generally available from more than one supplier.  However, certain components
needed by the Company can be obtained only from a limited number of
suppliers, the shortage of which could adversely impact production and/or
sale of certain equipment by the Company.

REGULATION

Many of the Company's products require approval by the Federal Communications
Commission (FCC) before they can be marketed in the United States.  In
addition, commercial acceptance of the Company's products is typically
dependent on the listing of such products by Underwriters Laboratories
("UL").  The Company has successfully obtained desired approvals and listings
of its products in the past; however, it cannot predict whether it will
obtain approvals for future products or whether requirements relating to the
Company's current or future products might change.  Internationally there are
equivalent approval requirements and risks.  See section entitled "Risk
Factors."

A number of municipalities in the United States have enacted or are
considering enacting legislation which penalizes false alarms which trigger
responses by police or fire departments.  The Company is unable to quantify
the effects such legislation may have on the security and fire protection
markets as a whole, or on the Company.

Compliance with federal, state and local laws and regulations regulating the
discharge of materials into the environment, or otherwise relating to the
protection of the environment have not had, and are not expected to have, a
material effect upon the capital expenditures, earnings or competitive
position of the Company.

EMPLOYEES

As of March 31, 2000, the Company directly or indirectly employed
approximately 1,200 persons worldwide.  Included in this total are 475
persons at the China manufacturing facility.  None of the Company's employees
are represented by a collective bargaining organization, and the Company's
management believes employee relations are good.

RISK FACTORS

Impact and Risks of Acquisitions

Between February 1996 and July 1999 the Company made ten acquisitions:
Radionics, DA Systems, Senses, Seriee, RAS, Security Supplies, EDM, Efsec,
Alarm Center and Caetec.  Part of the Company's growth strategy is to expand
its product catalog, technologies and markets through additional
acquisitions.  Integration of the operations, management and business
information systems of those acquisitions is ongoing.  There can be no
assurance that the Company will be able to successfully integrate the
operations and management of its recent acquisitions or that the Company will
be able to consummate or, if consummated, successfully integrate the
operations, management and business information systems of future
acquisitions.  Acquisitions involve several significant risks, including but
not limited to risks associated with: (i) the diversion of management's
attention to the assimilation of the acquired businesses; (ii) the ability of
the acquired businesses to maintain the quality of products and services that
the acquired businesses have historically provided; (iii) the need to
integrate financial and other systems with those of the Company and the
difficulty of achieving adequate internal and financial control and timely
reporting; (iv) the loss of key employees of the acquired businesses after
the acquisition; (v) unforeseen liabilities of the acquired business; (vi)
the dilutive effect of the issuance of additional equity securities; (vii)
the incurrence of additional debt as part of such acquisitions or to fund the
operations of the acquired business; and (viii) the amortization of goodwill
and other intangible assets involved in any acquisitions that are accounted
for using the purchase method of accounting.  In addition, certain of the
businesses acquired by the Company have been unprofitable and there can be no
assurance that they can be made profitable.  There can be no assurance that
future acquisition opportunities will become available, that future
acquisitions can be consummated on favorable terms or that such acquisitions
will contribute to the Company's profitability.  The Company continues to
investigate and consider acquisition opportunities.

Management of Growth

The Company's growth through acquisitions, expansion and related
consolidation resulted in financial and manufacturing system weaknesses and
resource constraints during prior years.  The Company has made substantial
improvements to its financial controls and enhanced its manufacturing
information systems in continuing efforts to keep pace with its expanded and
more complex operations. Despite the Company's continuing efforts to improve
its financial controls and management information systems, no assurance can
be given that such weaknesses will not reoccur in the future.  In the event
of such reoccurrence the Company's inability to manage growth and the related
consolidation effectively could have adverse effects on the Company's results
of operations, financial condition and financial reporting information.

Risks Associated with International Operations

The China factory is dependent on the local Chinese government for personnel,
factory space and utilities as well as all other municipal services.  See
"Business-Manufacturing."  The Company believes that its relationship with
the local Chinese government is good, however, any future deterioration of
such relationship could have a material adverse effect on the Company's
results of operations.  One aspect of the Company's business strategy is to
increase the sale of its products in international markets.  The Company's
international operations give rise to political and economic uncertainties
relating to, among other things, U.S. and foreign trade restrictions; foreign
government stability; risk of re-negotiation or modification of existing
agreements or arrangements with governmental authorities; foreign economic or
political instability; shipping costs and delays; tariffs; export controls;
government regulation; patent and trademark availability, protection and
registration; foreign exchange restrictions which limit the repatriation of
investments and earnings therefrom; changes in taxation or international tax
treaties; military action and other hostilities or confiscation of property.
While the United States imposes quotas and duties on selected imported
products, there are currently no U.S. quotas on the Company's products.

The Company is subject to currency exchange risks to the extent that its
purchases and sales occur outside the United States and it is unable to
denominate its purchases or sales in dollars or otherwise shift to its
customers or suppliers the risks of currency exchange rate fluctuations.
Currently, the Company does not engage in currency hedging transactions.
However, it may do so in the future.  Fluctuations in exchange rates may
affect the results of operations and financial position of the Company's
international operations reported in dollars.  Additionally, the results of
operations, financial condition and competitive position of the Company may
be affected by the relative strength of the currencies in countries where its
products are sold.

Dependence on Significant Customers and Industry Consolidation

The success of the Company depends on the business it conducts with a
limited number of significant customers. One customer is also a significant
competitor of the Company across many of its product lines and purchases the
Company's products to incorporate them into its products and systems. The
Company has had long-standing relationships with most of its significant
customers; however, it generally does not have supply contracts with them and
they may unilaterally reduce or discontinue their purchases without penalty. The
Company's loss of (or failure to retain a significant amount of business with)
any of these customers for any reason, including merger with or acquisition by
another business, could have a material adverse effect on the Company. The
Company believes that its acquisitions, its international marketing initiatives
and its increased use of distributors may help reduce the potential impact of
sales fluctuations associated with the Company's largest customers. During
fiscal 2000, sales to the Company's two largest customers accounted for 15.7%
(Honeywell) and 1.2% of net sales, respectively. In 1999, sales to the Company's
two largest customers accounted for 11.3% (Pittway) and 4.6% of net sales,
respectively. During 1998, sales to the Company's two largest customers
accounted for 9.9%% and 6.6% of net sales, respectively. See Note 9 to the
Consolidated Financial Statements found in Exhibit 13 of this Form 10-K for more
detailed information about sales to significant customers.

Intellectual Property

The Company's ability to compete effectively depends, in part, on its ability
to protect its intellectual property, including its patents, trademarks,
copyrights and trade secrets, and on its ability to develop and protect
future intellectual property.  In addition to patents, the Company relies on
a combination of trademark registrations, copyrights and confidentiality
agreements to protect its proprietary rights in intellectual property.  The
Company's ability to compete effectively also depends on its ability to avoid
infringing on the proprietary rights of others.  New patent applications are
continually being filed and prosecuted, and pending U.S. patent applications
are confidential until patents are issued.  As a result, it is impossible to
anticipate all potential patent infringement issues.  There can be no
assurance that the steps taken by the Company to protect its intellectual
property will be adequate to prevent misappropriation or that others will not
independently develop technology or products that compete with or are
superior to the products of the Company.  Likewise, there can be no assurance
that the Company will not inadvertently infringe on the intellectual property
rights of others.

Risks of Technological Change

The electronic protection industry is characterized by continuous
technological advances, frequent new product introductions and enhancements,
declining market prices for similar products over time and changes in
customer requirements.  The Company's future success will depend on its
ability to continue to develop new products and technology to meet customer
needs as well as to enhance its existing products and to continually reduce
product costs.  There can be no assurance that the Company's products and
services will continue to be competitive and accepted by the market in the
future.  Any failure by the Company to anticipate or respond rapidly to
technological advances, new products and enhancements by competitors, or
changes in customer requirements could have a material adverse effect on the
Company.  See "Business--Intellectual Property."

Dependence on Key Personnel

The Company is dependent upon the efforts of certain key members of its
senior management team, including Karl H. Kostusiak, Chairman and Chief
Executive Officer.  The loss of a key member of the Company's senior
management team could have an adverse effect on the operations of the
Company.  The Company carries no key man life insurance on any of its
management, but has non-competition agreements with certain key officers and
technical personnel.

Product Liability Claims

If an intrusion, fire or other event that the Company's products are designed
to detect occurs in a setting where the Company's products have been
installed, the Company may be subject to a claim that an error or omission on
the part of the Company contributed to the damages resulting from such event,
which damages could be substantial.  Such a claim could be made whether or
not the Company's product performed properly under the circumstances.  From
time to time the Company is subject to product liability claims in the
ordinary course of its business.  The Company carries product liability
insurance which management believes is adequate; however, a product liability
judgment or settlement in excess of available insurance proceeds could have a
material adverse effect on the financial condition and results of operations
of the Company and any adverse claim or settlement could have an adverse
effect on the availability and cost to the Company of product liability
insurance.  The Company does not believe that any pending or threatened
litigation will have a material adverse effect on the financial condition or
results of operation of the Company.  See "Item 3--Legal Proceedings."

Dependence on Suppliers; Concentration of Manufacturing

While the Company manufactures most of the products it sells, certain of the
components used in its products are purchased from third parties and are
available from a limited number of sources.  The loss of any one supplier or
an inability of suppliers to provide the Company with the required quantity
or quality of these components could have an interruptive effect on the
Company's business until such time as an alternative source of supply is
found.  See "Business--Manufacturing."

Substantially all of the products manufactured by the Company are produced at
facilities in Fairport, New York, Zhuhai, China or Sydney, Australia.
Accordingly, any event resulting in the slowdown or stoppage of any of these
manufacturing operations could have a material adverse effect on the Company.

Government Regulation and Product Listing

Many of the Company's products require approval by FCC before they can be
marketed in the United States.  In addition, commercial acceptance of the
Company's products is typically dependent on the listing of such products by
UL.  The Company has successfully obtained FCC approval and UL listing of its
products in the past; however, it cannot predict whether it will obtain
approvals for future products or whether FCC regulations or UL listing
requirements relating to the Company's current or future products might
change.  Failure to comply with FCC regulations or UL listing requirements,
an inability to receive approval for products under development or a change
in existing regulations or listing requirements that would make products
non-compliant, could have a material adverse effect on the financial
condition and results of operations of the Company.  Most foreign countries
also have similar regulatory agencies and private certification or listing
organizations, which could have the same impact on sales of the Company's
products within those countries.  In addition to the regulation of its
products, the Company is subject to local, state, federal and foreign laws
regarding the discharge of materials into the environment.

Volatility of Stock Price

The Common Stock has experienced significant volatility since the Company's
acquisition of Radionics in February 1996.  The market for securities of
technology companies historically has been more volatile than the market for
stocks in general.  The trading price of the Company's common stock may be
subject to wide fluctuations in response to quarter-to-quarter variations in
operating results, announcement of future developments including possible
acquisitions, new products by the Company or its competitors and other events
or factors.  These fluctuations may be compounded by the historically low
trading volume in the Company's common stock.  In addition, the stock market
has from time to time experienced extreme price and volume fluctuations that
have affected the market price for many technology companies and that often
have been unrelated to the operating performance of these companies.  These
broad market fluctuations may adversely affect the market price of the
Company's common stock.  See Market for the Registrants Common Stock and
Related Security Holder Matters--Price Range of Common Stock."

Litigation

The Company and certain officers and directors have been named defendants in
several lawsuits alleging violations of federal securities laws relating to
the Company's September 1997 public offering and certain of the Company's
public filings in 1997 and early 1998.  For additional information regarding
these lawsuits and associated risk factors, see Item 3 of this Form
10-K--Legal Proceedings, Item 7-Management's Discussion and Analysis of
Financial Condition and Results of Operations and Note 10 to the Consolidated
Financial Statements, which are incorporated herein by reference.

Year 2000

The Company has implemented the necessary changes related to Year 2000
issues.  For additional information regarding Year 2000, see Item 7 of this
Form 10-K--Management's Discussion and Analysis of Financial Condition and
Results of Operations, which is incorporated herein by reference.

Anti-takeover & Change in Control Provisions

The Company maintains employment and consulting agreements with two
executive officers which provide that upon the occurrence of certain events
following a change in control, the Company may be required to: (a) pay the
equivalent of three years compensation, (b) fund a trust, escrow account, or
similar vehicle with assets sufficient to pay a retirement benefit (commencing
at age 69) equal to 60% of the executive's base salary, and benefits, and (c)
make non-compete payments for the period between a change in control and age 69
equal to approximately 60% of the executive's base salary, and benefits. All
non-compete and retirement benefit payments cease if the officers compete with
the Company. See Exhibit 10(i)-Executive Employment Contract with Karl H.
Kostusiak and Exhibit 10(j)-Executive Employment Contract with David B. Lederer.
The shares beneficially owned by the Company's executive officers and directors
and the compensation payable to certain officers following a change in control
may have the effect of discouraging persons from pursuing a non-negotiated
takeover of the Company and preventing certain changes of control.

In February 2000, the Company adopted certain amendments to its By-laws that
may deter, discourage or make more difficult the assumption of control of the
Company by another person through a tender offer, merger, proxy contest or
similar transaction.  The Company's By-laws, as amended, limit the manner in
which shareholders may bring matters before shareholder meetings and nominate
directors for election to the Company's Board of Directors.  Shareholders
must generally provide a specified form of notice regarding any such matter
or nomination to the Company's Secretary within 90 to 120 days of an annual
meeting. Additionally, the amended By-laws no longer permit a special
shareholder meeting to be called by majority shareholder vote.

Also, Section 912 of the New York Business Corporation Law, which is
applicable to the Company, contains provisions that restrict certain business
combinations with interested shareholders, which may have the effect of
inhibiting a non-negotiated merger or other business combination involving
the Company.

ITEM 2. Properties.

The Company conducts manufacturing, research and general office operations at
its 92,000 square foot facility at 130 Perinton Parkway, Fairport, New York.

Radionics' product configuration and general office operations are conducted
at its 78,000 square foot facility located in Salinas, California, the lease
on which expires in June 1, 2004.

Detection Systems (HK) Ltd. ("DS Hong Kong"), a subsidiary of the Company,
has a sub-contracting agreement with the local government of Zhuhai, China
which runs through June 2005. The agreement requires the government to
arrange for a factory, personnel and utilities and for DS Hong Kong to
furnish manufacturing equipment, raw materials and management services.
Pursuant to this agreement DS Hong Kong pays a fee, production expenses and
makes payments to the workers at the facility.  The subcontractor is
currently expanding the facility from 70,000 to 120,000 square feet.  The
expansion is expected to be completed in August, 2000.

DS-Australia, a subsidiary of the Company, has a three-year lease for 15,500
square feet of manufacturing and office space from the former principal of
EDM which expires January 20, 2001.

ITEM 3. Legal Proceedings.

The Company and certain officers and directors have been named defendants in
several class-action lawsuits alleging violations of federal securities laws
relating to the Company's September 1997 public offering and certain of the
Company's public filings in 1997 and early 1998.  The underwriters of the
public offering have also been named as defendants in three of these class
actions.  The actions allege that the Company, certain of its officers and
directors and the underwriters made or are responsible for alleged
misstatements and omissions in various press releases and public filings
concerning the Company's business and financial condition.  In March, 2000,
the Company reached an agreement in principle to settle the consolidated
shareholder class action suits.  See Note 10 to the Consolidated Financial
Statements, which is incorporated herein by reference.

The Company experiences routine litigation in the normal course of business.
Also, the Company occasionally receives, and may continue to receive in the
future, communications from third parties claiming that the Company's
products or technologies infringe on such parties' intellectual property
rights.  The Company does not believe that any pending or threatened
litigation or intellectual property claims will have a material adverse
effect on the financial condition or results of the operations of the Company.

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

There were no matters submitted to a vote of security holders during the
Company's fourth quarter ending March 31, 2000.


PART II

ITEM 5. Market for the Registrant's Common Stock and Related Security Holder
         Matters.

The Company's common stock trades on The Nasdaq National Market tier of The
Nasdaq Stock Market under the symbol:  DETC.  On June 2,2000 the closing
price, as reported by The Nasdaq Stock Market, was $9.500 per share, and the
number of shareholders was approximately 3,700. Certain information regarding
the price range of the Company's Common Stock (quarterly high and low) is
presented below:


PRICE RANGE OF COMMON STOCK

The quarterly high and low bid of the Company's common stock during the past
two years (in dollars):

Fiscal Year Commencing April 1, 2000                  High              Low
                                                       ---              ---
  First quarter (through June 2, 2000)              $10.750             8.750

Fiscal Year Ended March 31, 2000
  Fourth quarter                                     13.000             9.438
  Third quarter                                      10.438             8.750
  Second quarter                                     10.500             7.813
  First quarter                                       9.125             7.125

Fiscal Year Ended March 31, 1999
  Fourth quarter                                    $10.500            $8.000
  Third quarter                                      11.875             8.625
  Second quarter                                     10.500             8.125
  First quarter                                      12.125             8.813

                                DIVIDEND POLICY

The Company has never declared or paid any cash dividends on its Common
Stock.  The Company currently anticipates that all of its earnings will be
retained for development and expansion of the Company's business and does not
anticipate paying any cash dividends in the foreseeable future.  Any future
determination as to the payment of cash dividends will depend on a number of
factors, including future earnings, capital requirements, the financial
condition and prospects of the Company and any restrictions under credit
agreements existing from time to time, as well as such other factors as the
Company's Board of Directors may deem relevant.  Certain financial covenants
in the Company's current credit facility, including a covenant to maintain a
minimum tangible net worth, limit the Company's ability to pay dividends.


ITEM 6. Selected Financial Data.

Unaudited interim quarterly results for the Company over the past two years
were as follows (in thousands, except per share data):

Fiscal Year Ending                               NET    EARNINGS (LOSS)
                            NET    GROSS      INCOME      PER SHARE
March 31,                 SALES   MARGIN      (LOSS)    BASIC   DILUTED
---------                ------  -------     -------   ------   -------
2000                                (Unaudited)

Fourth quarter**        $34,120  $13,360      $(609)   $(0.10)   $(0.10)
Third quarter            36,333   14,611      1,155      0.18      0.17
Second quarter           36,699   14,608      1,501      0.24      0.22
First quarter            34,766   13,802      1,421      0.22      0.21

1999
Fourth quarter          $34,581  $13,406     $1,178     $0.19     $0.17
Third quarter            34,201   13,147      1,231      0.19      0.18
Second quarter           35,455   13,559      1,230      0.19      0.18
First quarter*           33,808   12,770        832      0.13      0.12

*Includes charges relating to restructuring actions.  See Note 10 to the
Consolidated Financial Statements of this Form 10-K, which is incorporated
herein by reference.

**Includes charge relating to litigation settlement in March 2000.  See Note
10 to the Consolidated Financial Statements of this Form 10-K, which is
incorporated herein by reference.

The Company's five year summary of operations is presented below.  See the
discussion of acquisitions in "Business--Acquisitions" (in thousands, except
per share data):

Year Ended March 31, ......       2000       1999       1998     1997      1996
                              ========   ========   ========  ========  =======
Net sales .................   $141,918   $138,045   $126,343  $101,251  $41,858
Income (loss) before taxes       5,585      7,307      2,337     5,250  (10,665)
Provision (benefit) for tax      2,117      2,836        955     1,525   (2,810)
Net income (loss) .........      3,468      4,471      1,382     3,725   (7,855)

AT YEAR END
Current assets ............   $ 68,720   $ 66,341   $ 68,520  $ 50,501  $28,426
Current liabilities .......     17,591     17,244     23,576    19,434   12,714
Working capital ...........     51,129     49,097     44,944    31,067   15,712
Total assets ..............     95,618     92,812     94,044    68,276   45,897
Long term debt ............     16,595     17,179     16,549    28,086   17,936
Shareholders' equity ......     58,464     55,744     51,264    17,831   11,569
Number of employees .......      1,200      1,100      1,100       744      595
Number of shareholders ....      3,700      4,400      4,400     4,000    3,200

PER SHARE AMOUNTS
Net income (loss)-basic ...   $   0.55   $   0.71   $   0.25  $   0.85$   (1.87)
Net income (loss)-diluted .       0.51       0.65       0.24      0.76    (1.87)
Shareholders' equity ......       9.13       8.80       8.15      3.99     2.75

RATIOS/PERCENTAGES
Gross profit / sales ..........   39.7%      38.3%      33.6%     35.9%   33.2 %
Pre-tax profit (loss) / sales .    3.9%       5.3%       1.9%      5.2%  (25.5)%
Net income (loss) / sales .....    2.4%       3.2%       1.1%      3.7%   (8.8)%
Current ratio .................    3.9%       3.8%       2.9%      2.6%    2.2 %


ITEM 7. Management's Discussion and Analysis of Financial Condition and
        Results of Operations.

Overview

The Company is a supplier of equipment to the electronic protection
industry.  The Company designs, manufactures and markets electronic
detection, control and communication equipment for security, fire protection,
access control and closed circuit television ("CCTV") applications, offering
products primarily for the commercial and mid- to high-end residential
portions of the market.  From its founding in 1968 until 1995, the Company
was primarily a provider of security sensor devices for the domestic market.
In 1995, the Company adopted a strategy designed to expand its product
offerings, establish an international sales presence, increase its
manufacturing capacity and improve its overall cost structure.  Since then,
the Company has made ten acquisitions, opened six sales offices and
established a manufacturing facility in Asia.  These initiatives have enabled
the Company to significantly expand its product catalog and market reach and
to increase its net sales from $34,336,000 in fiscal 1995 to $141,918,000 in
fiscal 2000.

During fiscal 1996 through 2000, the Company completed ten acquisitions: (i)
the purchase in February 1996 of Radionics of California, which had annual
net sales of approximately $45,000,000, (ii) the purchase in July 1996 of
certain assets of Senses of California, which had annual net sales of
approximately $2,000,000, (iii) the purchase in May 1997 of DA Systems of the
United Kingdom, which had annual net sales of approximately $10,800,000, (iv)
the purchase in June 1997 of Seriee of France, which had annual net sales of
approximately $6,300,000,(v) the purchase in June 1997 of RAS of Belgium,
which had annual net sales of approximately $9,900,000, (vi) the purchase in
November 1997 of Security Supplies of New Zealand, which had annual net sales
of approximately $800,000, (vii) the purchase in January 1998 of EDM of
Australia, which had annual net sales of approximately $4,600,000, (viii) the
purchase in June 1998 of Efsec of Sweden, which had annual net sales of
approximately $3,000,000, (ix) the purchase in June 1998 of Alarm Center of
Hungary, which had annual net sales of approximately $500,000 and (x) the
purchase in July 1999 of Caetec, an Italian technology company with a line of
fire control products.  These acquisitions have served both to broaden the
Company's product lines and to increase its international presence.  These
acquisitions impact the comparability of financial information for fiscal
years 1999 and 1998.

The Company recognizes net sales upon shipment of products to customers.
Production expenses include materials, direct labor and manufacturing
overhead as well as an allocated portion of indirect overhead.  Research and
development expenses include costs associated with salaries and benefits for
certain engineering employees, supplies, agency approvals, depreciation and
occupancy, as well as charges for independent testing and independent
contractors engaged for specific projects.  Marketing, administrative and
general expenses include costs related to the Company's sales efforts and
corporate and general administrative functions, including costs of executive,
administrative and sales personnel, marketing/selling supplies, advertising,
outgoing freight, customs and other costs associated with product delivery,
depreciation and professional fees.


Results of Operations

The following table sets forth, for the periods indicated, the percentages
which certain items of income and expense bear to net sales:

Fiscal Year Ended March 31,                    2000       1999       1998
                                               ====       ====       ====
Net sales                                     100.0%     100.0%     100.0%
Costs and expenses:
  Production                                   60.3       61.7       65.6
  Research and development                      7.4        6.1        6.8
  Marketing, administrative & general          26.3       25.9       23.8
  Litigation                                    1.0         -          -
                                               ----       ----       ----
Operating income                                5.1        6.3        3.8

Net interest expense                           (0.8)      (1.1)      (1.6)
Other income (expense)                         (0.4)       0.1       (0.4)
                                                ---        ---        ---
Income before income taxes                      3.9        5.3        1.8
Provision for income taxes                      1.5        2.1        0.7
                                                ---        ---        ---
Net income                                      2.4%       3.2%       1.1%
                                                ===        ===        ===

Year Ended March 31, 2000 Compared to Year Ended March 31, 1999

The Company's net sales increased 2.8% to $141,918,000 in fiscal 2000 from
$138,045,000 in fiscal 1999. Net sales during the current period were
favorably impacted compared to the prior year period by increased sales of
fire, access control and CCTV products.  This was offset, in part, by the
continued impact of lower sales to one of the Company's major domestic
customers and by the acquisition of several of the Company's domestic
customers by other businesses who are not standardized on the Company's
products.  See Note 9 to the Consolidated Financial Statements for
information regarding the Company's sales by geographic region and to
significant customers.

Production expenses increased 0.4% to $85,537,000 in fiscal 2000 from
$85,163,000 in fiscal 1999.  As a percentage of net sales, production
expenses decreased to 60.3% from 61.7%. The increase in production expenses
was primarily due to a corresponding increase in the Company's net sales.
The decrease in production expenses as a percentage of net sales was
primarily due to improvements in the Company's manufacturing cost structure
and changes in product mix.

Research and development expenses increased 23.5% to $10,503,000 in fiscal
2000 from $8,507,000 in fiscal 1999.  As a percent of net sales, research and
development expenses increased to 7.4% in fiscal 2000 from 6.1% in fiscal
1999.  The increase in research and development expenses in the aggregate and
as a percentage of net sales is primarily attributable to personnel increases
to support the Company's technology initiatives.

Marketing, administrative and general expenses increased 4.4% to $37,315,000
in fiscal 2000 from $35,727,000 in fiscal 1999.  As a percentage of net
sales, marketing, administrative and general expenses increased to 26.3% in
fiscal 2000 from 25.9% in fiscal 1999.  The increase in marketing,
administrative and general expenses in the aggregate and as a percentage of
net sales was primarily due to additional headcount to support the expansion
of our market reach and relocation of the Company's U.K. office

In March, 2000, the Company reached an agreement in principle to settle the
shareholder class action suit.  The settlement is subject to certain
conditions, including court approval.  The Company recorded a one-time charge
of $1.4 million during the fourth quarter ending March 31, 2000, for
settlement costs not covered by insurance.

Included in other income (expense) are losses from fluctuations in currency
exchange rates of approximately $874,000, compared to a gain of approximately
$140,000 in the prior year.  The Company does not currently hedge foreign
exchange risk.

Net interest expense decreased $414,000 to $1,090,000 in fiscal 2000 from
$1,504,000 in fiscal 1999.  The decrease was primarily due to lower
borrowings outstanding.  During fiscal 2000 approximately $574,000 of debt
was repaid with cash generated from operations.

The Company's effective income tax rate for fiscal 2000 was 37.9% compared to
an effective rate of 38.8% in fiscal 1999.

Year Ended March 31, 1999 Compared to Year Ended March 31, 1998

The Company's net sales increased 9.3% to $138,045,000 in fiscal 1999 from
$126,343,000 in fiscal 1998.  The net sales of acquired businesses accounted
for $9,496,000 of this increase, while sales from the company's on-going
businesses accounted for approximately $2,206,000.  Net sales during 1999 by
the Company's on-going operations were favorably impacted compared to the
prior year by increased sales of security sensors and controls as well as
CCTV products.  This was offset, in part, by the impact of lower sales to one
of the Company's major domestic customers and by the acquisition of several
of the Company's domestic customers by other businesses who are not
standardized on the Company's products.  See Note 9 to the Consolidated
Financial Statements for information regarding the Company's sales by
geographic region and to significant customers.

Production expenses increased 2.7% to $85,163,000 in fiscal 1999 from
$82,893,000 in fiscal 1998.  As a percentage of net sales, production
expenses decreased to 61.7% from 65.6%.  The increase in production expenses
was primarily due to a corresponding increase in the Company's net sales.
The decrease in production expenses as a percentage of net sales was
primarily due to improvements in the Company's cost structure and changes in
product mix.

Research and development expenses decreased 0.8% to $8,507,000 in fiscal 1999
from $8,579,000 in fiscal 1998.  As a percent of net sales, research and
development expenses decreased to 6.1% in fiscal 1999 from 6.8% in fiscal
1998.  The decrease in research and development expenses as a percentage of
net sales was primarily due to the acquisition of redistributor businesses
during fiscal 1999 and 1998 which have sales but do not incur significant
research and development expenditures.

Marketing, administrative and general expenses increased 18.9% to $35,727,000
in fiscal 1999 from $30,039,000 in fiscal 1998.  As a percentage of net
sales, marketing, administrative and general expenses increased to 25.9% in
fiscal 1999 from 23.8% in fiscal 1998.  The increase in marketing,
administrative and general expenses in the aggregate and as a percentage of
net sales was primarily due to the acquisition of redistributor businesses in
fiscal 1999 and a full year of ownership of redistributor businesses acquired
during fiscal 1998.  Redistributor businesses typically have higher
marketing, administrative and general expenses associated with product
redistribution than do businesses with manufacturing operations.

Included in other income (expense) are gains from fluctuations in currency
exchange rates of approximately $140,000, compared to a loss of approximately
$298,000 in the prior year.

Net interest expense decreased $531,000 to $1,504,000 in fiscal 1999 from
$2,035,000 in fiscal 1998.  The decrease was primarily due to lower
borrowings outstanding.  During fiscal 1999 approximately $1,642,000 of debt
was repaid with cash generated from operations.

The Company's effective income tax rate for fiscal 1999 was 38.8% compared to
an effective rate of 40.9% in fiscal 1998.

Liquidity and Capital Resources

The Company considers liquidity to be its ability to meet its long- and
short-term cash requirements.  Prior to 1996, those requirements were
primarily met by cash generated by the Company's operating activities and
cash reserves.  Since then, the Company's growth strategy has required
external sources of financing to satisfy its liquidity needs.

During fiscal 2000, the Company's operating activities provided $9,787,000 of
operating cash flow.  Net income, depreciation and amortization provided
$7,314,000.  A decrease in inventories provided $5,274,000.  An increase in
accounts payable provided $2,238,000.  An increase in accounts receivable
used $1,503,000 and other account changes used $3,536,000 of operating cash
flow.

During fiscal 2000, cash used in investing activities was $4,002,000.  This
related to the acquisition of Caetec and capital expenditures.

During fiscal 2000, cash used in financing activities was $2,015,000,
primarily representing repurchases of treasury shares and principal
repayments of debt.

Pursuant to the terms of the Company's debt agreements, the Company has
certain ratios and covenants to maintain with respect to such items as
working capital, funded debt and fixed charges.  Failure to comply with these
guidelines constitutes a default and permits the lenders to cause the
obligations to become currently due.  On March 31, 2000, the Company was in
compliance with all covenants and requirements under the terms of the
borrowing agreements.

The Company's Board of Directors has authorized the repurchase of up to
$10,000,000 of the Company's common stock.  As of March 31, 2000, the
Company had purchased 86,500 shares of common stock for approximately
$807,000.

The Company maintains employment contracts that could require payments in the
event of a change in control.  See Item 1 of this Form 10-K--Anti-takeover
and Change in Control Provisions, which is incorporated herein by reference.

Capital Resources.  On March 31, 2000, the Company had cash balances of
$7,799,000.  On that date, the Company had a $17,000,000 revolving credit
facility that was not drawn.  This credit facility bears interest based upon
either the federal funds rate, the prime rate or LIBOR, each adjusted by a
factor which varies based upon the rates of funded debt to earnings before
interest, tax, depreciation and amortization, and matures on July 31, 2000.
During May 2000, the Company and its primary lender agreed to consolidate the
term loan and line of credit into a three year, $35,000,000 revolving line of
credit.  This facility will require interest only payments through June
2003.  Principal and interest payments will be required from June 2003
through May 2007.

The Company expects to continue its pursuit of acquisitions and the
development of new products and markets.  Significant expenditures will also
include continued research and development investment in detection, control
and communication projects.  The Company also plans to continue its efforts
to market its products internationally.

The Company believes that the combination of its current cash balances, cash
flows from operations and existing credit facilities will be sufficient to
fund its planned operations during fiscal 2001.

Year 2000 Issues.  The Company has implemented the necessary changes related
to year 2000 issues. Since January 1, 2000, the Company's mission critical
internal computer systems have continued to operate without exception and the
Company is not aware of product difficulties at any of our customer sites.

Euro Conversion.  The Company is continuing to assess the potential impact
that may result from the euro conversion in a number of areas, including the
following:  (1) accounting and tax; (2) management information systems
required to accommodate euro-denominated transactions; (3) the impact on
currency exchange costs and currency exchange rate risk; and (4) the impact
on existing contracts.  At this time, the Company does not anticipate any
significant impact resulting from the conversion.

Dividend Policy.  The Company is dedicated to promoting shareholder value
through long term profitability and growth and believes that continued
investments in future product development are essential to this goal.  For
this reason, it has been the Company's policy not to pay cash dividends.

Inflation.  During fiscal 2000, 1999 and 1998, inflation did not have a
significant impact on the Company's business, or results of operations.

Forward-Looking Statements

This Report contains certain "forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended and Section 21E of
the Securities Exchange Act of 1934, as amended which represent the Company's
expectations or beliefs, including, but not limited to, statements concerning
industry performance, the Company's operations, performance, financial
condition, growth and acquisition strategies, margins and growth in sales of
the Company's products.  For this purpose, any statements contained in this
Report that are not statements of historical fact may be deemed to be
forward-looking statements.  Without limiting the generality of the
foregoing, words such as "may," "will," "expect," "believe," "plan,"
"anticipate," "intend," "could," "estimate," "continue," "goal" or "strategy"
or the negative or other variations thereof or comparable terminology are
intended to identify forward-looking statements.  These statements by their
nature involve substantial risks and uncertainties, certain of which are
beyond the Company's control, and actual results may differ materially
depending on a variety of important factors, including those described
previously in the "Risk Factors" section and elsewhere in this Form 10-K,
which is incorporated herein by reference thereto.

ITEM 8. Financial Statements and Supplementary Data.

The financial statements and supplementary data required in this section are
included as Exhibit 13 of this Form 10-K, which is incorporated herein by
reference thereto.

ITEM 9. Disagreements on Accounting and Financial Disclosure.

      Not applicable.

PART III

ITEM 10. Directors and Executive Officers of the Registrant.

The officers of the Company are as follows:

Name and Age                  Position, Offices Held and Year Appointed
------------                  -----------------------------------------
Karl H. Kostusiak (61)        CEO & President (1968)

David B. Lederer (60)         Executive Vice President (1968)

George E. Behlke (43)         Vice President, Operations & GM Asia (1995)

Frank J. Ryan (46)            Vice President, Secretary and Treasurer (1982)

Christopher P. Gerace (32)    Vice President, Chief Accounting Officer (1999)

Jeffrey M. Swan (35)          Vice President, Engineering (1999)

Each officer is elected to serve until the first meeting of the Board of
Directors held after the next annual meeting of shareholders and until his
successor is elected and has qualified.  There is no family relationship
between any of the above officers.

Messrs. Kostusiak and Lederer have been President and Executive Vice
President of the Company since it was formed in 1968.  Effective April 1,
1998, Mr. Lederer  reduced his involvement to half time and served as Vice
President, Business Development.  In April, 2000, Mr. Lederer returned to
full time status as Executive Vice President.  Mr. Ryan has been employed by
the Company in various financial positions since 1980 and was promoted to
Vice President in 1989.  Mr. Behlke has been employed by the Company in
various engineering positions since 1977 and was promoted to Vice President
in May 1995.  Mr. Gerace has been employed by the Company as Chief Accounting
Officer since 1997 and was promoted to Vice President in June 1999.  Prior to
working for the Company Mr. Gerace was with the Audit and Business Advisory
Services Group of Price Waterhouse, LLP.  Mr. Swan has been employed by the
Company in various engineering positions since 1992 and was promoted to Vice
President in June, 1999.

The Company's Proxy Statement for the 2000 Annual Meeting of Shareholders
contains the other information required by Item 10 of Form 10-K.  That
information is incorporated by reference in this Form 10-K.

ITEM 11. Executive Compensation.

The "Executive Compensation" section of the Company's Proxy Statement for its
2000 Annual Meeting of Shareholders contains the information required by Item
11, and is incorporated by reference in this Form 10-K.

ITEM 12. Security Ownership of Certain Beneficial Owners and Management.

The Company has stock purchase agreements with Messrs. Kostusiak and Lederer
which could in the future result in a change of control of the registrant.
These agreements are included in Exhibit 10 in this Form 10-K.

The Company's Proxy Statement for its 2000 Annual Meeting of Shareholders
contains the information required by Item 12, and is incorporated by
reference in this Form 10-K.

ITEM 13. Certain Relationships and Related Transactions.

The Company's Proxy Statement for its 2000 Annual Meeting of Shareholders
contains the information required by Item 13, and is incorporated by
reference in this Form 10-K.


PART IV

ITEM 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.

(a)  Documents filed as part of this report:
                                                                         Page
                                                                        ------
     (1) Consolidated Financial Statements:
         Report of Independent Accountants................................31
         Consolidated Balance Sheet.......................................32
         Consolidated Statement of Operations and Retained Earnings.......33
         Consolidated Statement of Cash Flows.............................34
         Notes to Consolidated Financial Statements.......................35

     (2) Consolidated Financial Statement Schedule V-Valuation
            and Qualifying Accounts.......................................30

         Financial statement schedules other than those
         listed above have been omitted because the
         required information is contained in the financial
         statements and notes thereto, or because such
         schedules are not required or applicable.

     (3) See Exhibit index beginning on page 25 of this Form 10-K.

(b)  There were no Form 8-K filings during the last quarter of the period
     covered by this report.



                                  SIGNATURES

      Pursuant to the requirements of Section 13 or 15(d) 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.

      ............                        DETECTION SYSTEMS, INC.
      ............                        (Registrant)



Date:  June 29, 2000                      By: /s/ Karl H. Kostusiak
      ............                        Karl H. Kostusiak
      ............                        President

      Pursuant to the requirements of 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.

Signature                        Title                        Date
---------                        -----                        -----

/s/ Karl H. Kostusiak            CEO, President and Director  June 29, 2000
Karl H. Kostusiak                (Principal Executive
                                 Officer)

/s/ Frank J. Ryan                Vice President               June 29, 2000
Frank J. Ryan                    Secretary/Treasurer
                                 (Principal Financial
                                 Officer)

/s/ Christopher P. Gerace        Vice President               June 29, 2000
Christopher P. Gerace            Chief Accounting Officer
                                 (Principal Accounting
                                 Officer)

Donald R. Adair                  Director

Mortimer B. Fuller, III          Director

David B. Lederer                 Executive Vice President &
                                 Director

Edward C. McIrvine               Director

By: /s/ Karl H. Kostusiak        Attorney-in-Fact             June 29, 2000
Karl H. Kostusiak



                                EXHIBIT INDEX

Item
No.                  Exhibits                         Location

3(a)       Detection Systems, Inc.       Incorporated by reference to
           Certificate of                Exhibit 3 of the Company's
           Incorporation as amended      Quarterly Report on Form 10-Q for
                                         the quarter ended 9/30/99

3(b)       Detection Systems, Inc.       Incorporated by reference to
           By-Laws as amended            Exhibit 3(b) of the Company's 1997
                                         Annual Report on Form 10-K

10(a)      Medical reimbursement plan    Incorporated by reference to
                                         Exhibit 10(b) of the Company's
                                         1997 Annual Report on Form 10-K

10(b)      Employee stock purchase plan  Incorporated by reference to
                                         Exhibit 10 of the Company's 1994
                                         Annual Report on Form 10-K

10(c)      Fleet Amended & Restated      Incorporated by reference to
            Credit Facility Agreement    Exhibit 10(c) of the Company's
            dated September 30, 1998     Quarterly Report on Form 10-Q for
                                         the quarter ended 9/30/98

10(d)      Deferred Compensation Plan    Incorporated by reference to
           and Deferred Bonus Plan       Exhibit 10(c) to the Company's
                                         Quarterly Report on Form 10-Q, for
                                         the quarter ended 12/31/97

10(e)      1992 Restated Stock Option    Incorporated by reference to
           Plan                          Exhibit 22 of the Company's 1995
                                         Annual Report on Form 10-K

10(f)      1997 Stock Option Plan        Incorporated by reference to
                                         Exhibit A of the Company's Definitive
                                         Proxy Form DEF 14A filed on 7/8/99

10(g)      Non-Employee Director Stock   Incorporated by reference to
           Option Plan                   Exhibit B of the Company's
                                         Definitive Proxy Form DEF 14A
                                         filed 7/8/99

10(h)      Executive Officer Cash        Incorporated by reference to the
           Bonus Plan                    Company's 1999 Annual Report on
                                         Form 10-K

10(i)      Executive employment          Incorporated by reference to
           contract with Karl H.         Exhibit 10(i) of the Company's
           Kostusiak                     Quarterly Report on Form 10-Q for
                                         the quarter ended 6/30/99

10(j)      Executive employment          Incorporated by reference to
           contract with David B.        Exhibit 10(j) of the Company's
           Lederer                       Quarterly Report on Form 10-Q for
                                         the quarter ended 6/30/99

10(k)      Stock Purchase Agreements     Incorporated by reference to
           with Karl H. Kostusiak and    Exhibit 10(n) of the Company's
           David B. Lederer              1997 Annual Report on Form 10-K

11         Statement re: Computation     Included as Exhibit 11 of this
           of Per Share Earnings         Annual Report on Form 10-K

13         Excerpts from Annual Report   Included as Exhibit 13 of this
           to Security Holders           Annual Report on Form 10-K

22         Proxy Statement               To be filed within 120 days of the
                                         Company's fiscal year end

23         Consent of Independent        Included as Exhibit 23 of this
           Accountants                   Annual Report on Form 10-K

24         Powers of Attorney            Included as Exhibit 24 of this
                                         Annual Report on Form 10-K

27         Financial Data Schedule       Included as Exhibit 27 of this
                                         Annual Report on Form 10-K