<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-Q/A
                                (AMENDMENT NO. 2)



(Mark One)

(x)      Quarterly report pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934

         For the quarterly period ended March 31, 2001
                                        --------------

( )      Transition report pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934
         For the quarterly period from       to
                                       -----    -----

                        Commission file number 000-19579

                            INTERACTIVE NETWORK, INC.
             (Exact name of registrant as specified in its charter)


California                               94-3025019
(State of incorporation)                 (I.R.S. employer identification number)

                           180 Second Street, Suite B
                           Los Altos, California 94022
              (Address of principal executive offices and zip code)

                                 (650) 947-3345
              (Registrant's telephone number, including area code)


                        with a copy to Robert S. Townsend
                            Morrison & Foerster, LLP
                                425 Market Street
                             San Francisco, CA 94105
                                 (415) 268-7000

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.

Yes [X]  No [ ]

Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.

Yes [X]  No [ ]

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

Class                             Shares outstanding as of January 4, 2002
-----                             -----------------------------------------
Common Stock                               43,019,277

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                            INTERACTIVE NETWORK, INC.

                                      INDEX



PART I.           FINANCIAL INFORMATION                                     Page
                                                                            ----

         ITEM 1.     FINANCIAL STATEMENTS.....................................1

                     CONSOLIDATED BALANCE SHEETS AS OF
                      MARCH 31, 2001 (Unaudited) AND DECEMBER 31, 2000........1

                     CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
                       FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND 2000.....2

                     CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
                       FOR THE THREE MONTHS ENDED MARCH 31, 2001
                       AND 2000...............................................3

                     NOTES TO FINANCIAL STATEMENTS (Unaudited)................4

         SIGNATURES..........................................................11



                                EXPLANATORY NOTE

This Amendment No. 2 on Form 10-Q/A to the Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 2001 is being filed to amend Item 1 of Part I
to read as follows. No other changes are being made to the Form 10-Q.

<PAGE>

                                     PART I.

                              FINANCIAL INFORMATION

<TABLE>

ITEM 1.  FINANCIAL STATEMENTS.

INTERACTIVE NETWORK, INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)

<CAPTION>
                                                                            As of               As of
                                                                        March 31, 2001    December 31, 2000
                                                                        --------------    -----------------
                                                                         (Unaudited)
<S>                                                                     <C>                 <C>
Assets
Current assets:
    Restricted cash                                                     $   5,576,421       $   5,609,735
    Cash                                                                      413,979             685,168
    Royalty fee receivable                                                     67,500             250,000
    Prepaid expenses and other current assets                                  53,027              47,218
                                                                        --------------      --------------

          Total current assets                                              6,110,927           6,592,121

Deposits and other assets                                                       3,430               3,220

                                                                        --------------      --------------
          Total assets                                                  $   6,114,357       $   6,595,341
                                                                        ==============      ==============

LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)

Current liabilities:
    Accounts payable and accrued liabilities                            $     435,861       $     443,952
    Promissory note - current                                                 171,130              85,565
    Deferred legal fees                                                       957,775             957,775
                                                                        --------------      --------------

          Total current liabilities                                         1,564,766           1,487,292

Liabilities subject to compromise                                           5,499,998           5,503,263
Promissory note - noncurrent                                                  513,390             598,955


Shareholders' deficit:
    Preferred stock, no par value, 10,000,000 shares
       authorized; no shares issued and outstanding as of
       March 31, 2001 and December 31, 2000                                         -                   -

    Common stock, no par value, 150,000,000 shares
       authorized; 43,019,277 shares issued and
       outstanding as of both March 31, 2001 and December 31, 2000        145,874,986         145,874,986

    Accumulated deficit                                                  (147,338,783)       (146,869,155)
                                                                        --------------      --------------

          Total shareholders' equity (deficit)                             (1,463,797)           (994,169)

                                                                        -------------       -------------
          Total liabilities and shareholders' equity (deficit)          $   6,114,357       $   6,595,341
                                                                        ==============      ==============
</TABLE>

See accompanying notes to consolidated financial statements.

                                       1
<PAGE>
<TABLE>

INTERACTIVE NETWORK, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

<CAPTION>
                                                              THREE MONTHS ENDED MARCH 31,
                                                                  2001            2000
                                                               ----------      ----------
<S>                                                            <C>             <C>
Royalty fees                                                   $  67,500       $       -
                                                               ----------      ----------

General and administrative expenses:
     Salaries                                                     77,919          65,641
     Employer payroll taxes                                        6,630           5,592
     Contract labor                                               25,507          25,670
     Rent                                                          9,000           2,066
     D&O insurance                                                15,900               -
     Other administrative costs                                   13,490          33,671

        Legal fees                                                48,109          44,086
        Accounting fees                                           21,096          37,318
        Advisory fees                                                  -         390,000
        Legal - NTN litigation                                     2,388           4,769
        Shareholder relations - proxy                              1,400           3,883
                                                               ----------      ----------

General and administrative expenses                              221,439         612,696
                                                               ----------      ----------

           Loss from operations                                 (153,939)       (612,696)

Other (income) and expense
     Interest income                                             (73,076)         (2,526)
     Interest expense                                            137,965           7,872
     Net loss from investment in affiliate
        accounted for by the equity method                       304,859           5,491
     Reserve for impairment of investment                        (54,859)              -
     Litigation settlement                                             -        (219,215)
                                                               ----------      ----------

           Other (income) and expense, net                       314,889        (208,378)
                                                               ----------      ----------

           Income (loss) before reorganization expenses         (468,828)       (404,318)

Reorganization expenses                                                -         106,272
                                                               ----------      ----------

           Net income (loss) before federal & state taxes       (468,828)       (510,590)

              Federal & state taxes                                  800             800

           Net income (loss)                                   $(469,628)      $(511,390)
                                                               ==========      ==========

Basic and diluted loss per share                               $   (0.01)      $   (0.01)
Shares used in basic and diluted net loss per share           43,019,277      39,111,697

</TABLE>

See accompanying notes to consolidated financial statements.

                                       2
<PAGE>
<TABLE>

INTERACTIVE NETWORK, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

<CAPTION>
                                                                                THREE MONTHS ENDED MARCH 31,
                                                                                   2001              2000
                                                                               ------------      ------------
<S>                                                                            <C>               <C>
Cash flows from operating activities:
     Net loss                                                                  $  (469,628)      $  (511,390)
     Adjustments to reconcile net loss to net cash provided by (used for)
        operating activities:
           Reorganization expenses                                                       -           105,521
           Loss from investment in affiliate                                       304,859             5,491
           Allowance for investment in affiliate                                   (54,859)                -
           Changes in assets and liabilities:
              Royalty fee receivable                                               182,500                 -
              Prepaid expenses and other assets                                    (10,000)                -
              Accounts payable                                                      (8,091)          (40,970)
              Other accrued liabilities                                                716          (603,509)
                                                                               ------------      ------------
                 Cash provided by (used in) operating activities:                  (54,503)       (1,044,857)

Cash flows from investing activities:
     Investment in TWIN Entertainment                                             (250,000)         (500,000)
                                                                               ------------      ------------
                 Cash provided by (used in) financing activities:                 (250,000)         (500,000)
                                                                               ------------      ------------


Cash flows from financing activities:
     Sale of common stock                                                                -                 -
     Exercise of options                                                                 -           490,997
                                                                               ------------      ------------
                 Cash provided by (used in) financing activities:                        -           490,997
                                                                               ------------      ------------

Net decrease in cash                                                              (304,503)       (1,053,860)

     Cash at beginning of period                                                 6,294,903         7,576,158
                                                                               ------------      ------------

     End of period                                                             $ 5,990,400       $ 6,522,298
                                                                               ============      ============
</TABLE>

See accompanying notes to consolidated financial statements.

                                       3
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                            INTERACTIVE NETWORK, INC.

              Notes to Unaudited Consolidated Financial Statements

                                 March 31, 2001

The consolidated financial information of Interactive Network, Inc. (the
"Company") furnished herein reflects all adjustments, consisting only of normal
recurring adjustments which in the opinion of management are necessary to
present fairly the financial position of the Company as of March 31, 2001 and
the results of its operations and cash flows for the periods presented. This
Quarterly Report on Form 10-Q should be read in conjunction with the financial
statements and notes thereto included in the Company's Form 10-K Report for the
year ended December 31, 2000 filed with the Securities and Exchange Commission
("SEC") on April 16, 2001. The results of operations for the three-month period
ended March 31, 2001 are not necessarily indicative of the results for any
subsequent quarter or for the entire year ending December 31, 2001.

Current liabilities consist of accounts payable, and legal fees and expenses
incurred in connection with the Company's Chapter 11 bankruptcy proceedings and
general corporate work. Payment of Morrison & Foerster's pre-confirmation fees,
which is subject to Bankruptcy Court approval, was deferred by agreement until
April 22, 2000, when payment was due in full without interest. As the Company
lacked funds to pay Morrison & Foerster's fees at that time, Morrison & Foerster
did not apply to the Bankruptcy Court for approval of its fees. However, it
expects to do so soon. The amount of preconfirmation fees sought by Morrison &
Foerster is subject to reduction by the Bankruptcy Court and the payment of the
preconfirmation fees is subject to an agreement between Morrison & Foerster and
the Company.

INVESTMENT IN AFFILIATE. The Company owns 50% of the outstanding capital stock
of TWIN Entertainment, Inc. ("TWIN Entertainment"), a corporate joint venture
between the Company and Two Way TV Limited ("Two Way TV"). TWIN Entertainment's
offices are located at 4929 Wilshire Boulevard - Suite 930, Los Angeles, CA
90010. TWIN Entertainment operates in the United States and Canada using
technology licensed by the Company and Two Way TV. The Company made additional
investments in TWIN Entertainment in the form of loans of $750,000 in September
2000, $250,000 in December 2000 and $250,000 in February 2001, and Two Way TV
made similar investments, leaving the relative ownership interests in TWIN
Entertainment unchanged. Each party reserves the right to convert such amounts
to equity in TWIN Entertainment in the future under terms to be determined and
agreed upon at a later date by the parties.

Condensed financial data of TWIN Entertainment for the three month period ended
March 31, 2001 follows:


<TABLE>
<CAPTION>
                                                                    FROM INCEPTION AT
                                              THREE MONTHS ENDED  JANUARY 10, 2001 THROUGH
                                                MARCH 31, 2001        MARCH 31, 2001
                                                --------------        --------------
<S>                                             <C>                     <C>
SUMMARY OF OPERATIONS
Revenues                                        $         0             $         0
Costs and expenses                                  872,112               3,058,561
Income taxes                                              0                     800
Net loss                                           (872,112)             (3,059,361)
Interactive Network's equity in net income         (436,056)             (1,529,680)

BALANCE SHEET DATA ASSETS
Current assets                                      413,696                  60,247
Non-current assets                                  438,092                 351,115
                                                ------------            ------------
     Total assets                               $   851,788             $   411,362

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities                                 369,974
Long-term debt                                    2,500,000
Other non-current liabilities
Shareholders' deficit                            (2,018,186)
                                                ------------
     Total liabilities and shareholders'
     deficit                                    $   851,788

</TABLE>

                                       4
<PAGE>

The Company periodically evaluates the recoverability of its equity investments,
in accordance with APB No. 18, "The Equity Method of Accounting for Investments
in Common Stock," and if circumstances arise where a loss in value is considered
to be other than temporary, the Company will record a write-down of investment
cost. The Company's recoverability analysis is based on the projected
undiscounted cash flows of the operating ventures, which is the lowest level of
cash flow information available. The Company's share of the operating loss from
its joint venture investment in TWIN Entertainment was approximately $305,000
for the quarter ended March 31, 2001 accounted for by the equity method. The
Company also adjusted its allowance against its investment and outstanding loans
in the amount of $54,859 to write the investment, including loans, down to zero
at March 31, 2001, as no assurance can be made that the joint venture will be
profitable in the future.





                                       5
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SIGNATURES

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE
REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED THEREUNTO DULY AUTHORIZED.

Date: January 9, 2002

                            INTERACTIVE NETWORK, INC.
                            (Registrant)

                            By: /S/ Bruce W. Bauer
                                --------------------------
                                Bruce W. Bauer
                                Chairman of the Board
                                President, Chief Executive Officer
                                and Chief Financial Officer (principal financial
                                officer)