<PAGE>

                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, DC  20549
                                   FORM 10-Q

(Mark One)

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

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


                                       or

(_)  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

     For the transition period from  ____________  to  ______________

Commission File Number                0-6533
                                      ------

                          BOSTON LIFE SCIENCES, INC.
            (Exact name of registrant as specified in its charter)

         Delaware                                                87-0277826
(State or other jurisdiction of                                (IRS Employer
incorporation or organization)                               Identification No.)

137 Newbury Street, 8th Floor, Boston, Massachusetts                02116
(Address of principal executive offices)                          (Zip code)


                                (617) 425-0200
             (Registrant's telephone number, including area code)

                                Not Applicable
       (Former name, former address and former fiscal year, if changed
                              since last report)

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.

                   (X)    Yes                     (  )    No

As of May 7, 2001 there were 20,726,638 shares of Common Stock outstanding.
<PAGE>

                          BOSTON LIFE SCIENCES, INC.

                              INDEX TO FORM 10-Q

<TABLE>
<CAPTION>
                                                                          Page (s)
                                                                          --------
<S>                                                                      <C>
Part I - Financial Information

  Item 1 - Financial Statements (Unaudited)
    Consolidated Balance Sheets as of March 31, 2001                       1
    and December 31, 2000

    Consolidated Statements of Operations for the three months             2
    ended March 31, 2001 and 2000, and for the period from
    inception (October 16, 1992) to March 31, 2001

    Consolidated Statements of Cash Flows for the three months             3
    ended March 31, 2001 and 2000, and for the period from
    inception (October 16, 1992) to March 31, 2001

    Notes to Consolidated Financial Statements                             4 - 5

  Item 2 - Management's Discussion and Analysis of Financial               6 - 7
           Condition and Results of Operations

  Item 3 - Quantitative and Qualitative Disclosures about Market Risk      7

Part II - Other Information

  Item 1 - Legal Proceedings                                               8

  Item 2 - Changes in Securities                                           8

  Item 3 - Defaults Upon Senior Securities                                 8

  Item 4 - Submission of Matters to a Vote of Security Holders             8

  Item 5 - Other Information                                               8

  Item 6 - Exhibits and Reports on Form 8-K                                8

Signatures                                                                 9
</TABLE>
<PAGE>

Part I - Financial Information
Item 1 - Financial Statements

                           Boston Life Sciences, Inc.
                        (A Development Stage Enterprise)

                          Consolidated Balance Sheets
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                             March 31,               December 31,
                                                                                2001                      2000
                                                                      ---------------------     ---------------------
<S>                                                                     <C>                       <C>
Assets
Current assets:
  Cash and cash equivalents                                                    $  2,784,229              $    407,327
  Short-term investments                                                         15,233,868                19,361,838
  Other current assets                                                              581,475                   703,867
                                                                      ---------------------     ---------------------
      Total current assets                                                       18,599,572                20,473,032
Fixed assets, net                                                                   211,093                    42,034
Other assets                                                                        199,704                   197,043
                                                                      ---------------------     ---------------------
      Total assets                                                             $ 19,010,369              $ 20,712,109
                                                                      =====================     =====================

Liabilities and Stockholders' Equity
Current liabilities:
  Accounts payable and accrued expenses                                        $  1,902,288              $  1,661,293

Stockholders' equity:
  Convertible preferred stock, $.01 par value; 525,000 and 15,000
   shares authorized at March 31, 2001 and December 31, 2000,
   respectively; no shares issued and outstanding                                         -                         -

  Common stock, $.01 par value; 40,000,000 shares authorized;
   20,726,638 shares issued and outstanding                                         207,266                   207,266

  Additional paid-in capital                                                     83,605,297                83,605,297
  Accumulated other comprehensive income                                            199,499                    20,497
  Deficit accumulated during development stage                                  (66,903,981)              (64,782,244)
                                                                      ---------------------     ---------------------
      Total stockholders' equity                                                 17,108,081                19,050,816
                                                                      ---------------------     ---------------------
      Total liabilities and stockholders' equity                               $ 19,010,369              $ 20,712,109
                                                                      =====================     =====================



                   The accompanying notes are an integral part of the consolidated financial statements.

</TABLE>

                                       1
<PAGE>

                           Boston Life Sciences, Inc.
                        (A Development Stage Enterprise)

                     Consolidated Statements of Operations
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                                                          From Inception
                                                               Three Months Ended                          (October 16,
                                                                   March 31,                                 1992) To
                                                       2001                        2000                   March 31, 2001
                                             -----------------------     -----------------------     ----------------------
<S>                                         <C>                         <C>                         <C>
Revenues                                                 $         -                 $         -               $    900,000
Operating expenses:
 Research and development                                  1,744,168                   1,951,249                 42,424,931
 General and administrative                                  695,511                     766,104                 16,437,451
 Purchased in-process research and
  development                                                      -                           -                 12,146,544
                                             -----------------------     -----------------------     ----------------------
   Total operating expenses                                2,439,679                   2,717,353                 71,008,926
                                             -----------------------     -----------------------     ----------------------
   Loss from operations                                   (2,439,679)                 (2,717,353)               (70,108,926)
Interest expense                                                   -                    (344,870)                (2,252,457)
Interest income                                              317,942                     111,073                  5,457,402
                                             -----------------------     -----------------------     ----------------------
   Net loss                                              $(2,121,737)                $(2,951,150)              $(66,903,981)
                                             =======================     =======================     ======================

   Basic and diluted net loss per share                       $(0.10)                     $(0.17)
                                             =======================     =======================

   Weighted average shares outstanding                    20,726,638                  17,055,434
                                             =======================     =======================


                       The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>



                                       2
<PAGE>

                           Boston Life Sciences, Inc.
                        (A Development Stage Enterprise)

                     Consolidated Statements of Cash Flows
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                                                    From Inception
                                                                 Three Months Ended                 (October 16,
                                                                     March 31,                        1992) to
                                                           2001                   2000              March 31, 2001
                                                      -----------------     -----------------     -----------------
<S>                                                   <C>                          <C>                          <C>
Cash flows from operating activities:
 Net loss                                                   $(2,121,737)          $(2,951,150)         $(66,903,981)
 Adjustments to reconcile net loss to net cash used
  for operating activities:
  Purchased in-process research and development                       -                     -            12,146,544
  Write-off of acquired technology                                    -                     -             3,500,000
  Non-cash interest expense                                           -               332,493               579,685
  Compensation charge related to options and warrants                 -                     -             2,080,321
  Amortization and depreciation                                   5,941                14,967             1,522,232
  Changes in current assets and liabilities:
   Decrease in other current assets                             122,392               172,140                82,350
   Increase in accounts payable and accrued expenses            240,995               622,015             1,129,623
                                                      -----------------     -----------------     -----------------
Net cash used for operating activities                       (1,752,409)           (1,809,535)          (45,863,226)

Cash flows from investing activities:
 Cash acquired through Merger                                         -                     -             1,758,037
 Purchases of fixed assets                                     (175,000)              (33,848)             (487,850)
 Increase in other assets                                        (2,661)               (2,158)             (358,201)
 Purchases of short-term investments                         (2,621,157)           (3,542,333)          (80,858,829)
 Sales and maturities of short-term investments               6,928,129             3,227,593            65,824,460
                                                      -----------------     -----------------     -----------------
Net cash provided by (used for) investing activities          4,129,311              (350,746)          (14,122,383)

Cash flows from financing activities:
 Proceeds from issuance of common stock                               -             2,468,083            31,249,182
 Proceeds from issuance of preferred stock                            -                     -            27,022,170
 Preferred stock conversion inducement                                -                     -              (600,564)
 Proceeds from issuance of notes payable                              -                     -             2,585,000
 Proceeds from issuance of convertible debentures                     -                     -             9,000,000
 Principal payments of notes payable                                  -                     -            (2,796,467)
 Payments of financing costs                                          -                     -            (3,689,483)
                                                      -----------------     -----------------     -----------------
Net cash provided by financing activities                             -             2,468,083            62,769,838
                                                      -----------------     -----------------     -----------------
Net increase in cash and cash equivalents                     2,376,902               307,802             2,784,229
Cash and cash equivalents, beginning of period                  407,327               260,134                     -
                                                      -----------------     -----------------     -----------------
Cash and cash equivalents, end of period                    $ 2,784,229           $   567,936          $  2,784,229
                                                      =================     =================     =================

Supplemental cash flow disclosures:
 Non cash transactions (see note 3)

                 The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>

                                       3
<PAGE>

                           Boston Life Sciences, Inc.
                        (A Development Stage Enterprise)

             Notes to Consolidated Financial Statements (Unaudited)

                                 March 31, 2001


1. Basis of Presentation

   The accompanying unaudited consolidated financial statements have been
   prepared in accordance with accounting principles generally accepted in the
   United States of America for interim financial information and pursuant to
   the rules and regulations of the Securities and Exchange Commission.
   Accordingly, these financial statements do not include all of the information
   and footnotes required by accounting principles generally accepted in the
   United States of America for complete financial statements.

   The interim unaudited consolidated financial statements contained herein
   include, in management's opinion, all adjustments (consisting of normal
   recurring adjustments) necessary for a fair presentation of the financial
   position, results of operations, and cash flows for the periods presented.
   The results of operations for the interim period shown on this report are not
   necessarily indicative of results for a full year. These financial statements
   should be read in conjunction with the Company's consolidated financial
   statements and notes for the year ended December 31, 2000 included in the
   Company's Annual Report on Form 10-K.

2. Net Loss Per Share

   Basic and diluted net loss per share available to common stockholders has
   been calculated by dividing net loss by the weighted average number of common
   shares outstanding during the period. All potential common shares have been
   excluded from the calculation of weighted average common shares outstanding
   since their inclusion would be anti-dilutive.

   Stock options and warrants to purchase approximately 7.5 million and 6.4
   million shares of common stock were outstanding at March 31, 2001 and 2000,
   respectively, but were not included in the computation of diluted net loss
   per common share because they were anti-dilutive. The exercise of those stock
   options and warrants outstanding at March 31, 2001, which could generate
   proceeds to the Company of up to $41.5 million, could potentially dilute
   earnings per share in the future.

                                       4
<PAGE>

                           Boston Life Sciences, Inc.
                        (A Development Stage Enterprise)

             Notes to Consolidated Financial Statements (Unaudited)


3.  Supplemental Disclosure of Non-cash Investing and Financing Activities

    During the three months ended March 31, 2000, the Company issued 87,121 and
    300,614 shares of common stock resulting from the conversion of 4,983 and
    53,669 shares of Series A and Series C preferred stock, respectively. During
    the three months ended March 31, 2000, the Company also issued 1,573,956
    shares of common stock resulting from the conversion of convertible
    debentures with a face value of $8 million plus accrued interest of
    approximately $212,000. The carrying value of the debentures plus the
    accrued interest net of deferred financing costs of approximately $307,000
    was reclassified to additional paid-in capital upon conversion of the
    debentures.

4.  Comprehensive Loss

    The Company had total comprehensive loss of $1,942,735 and $2,830,314 for
    the three months ended March 31, 2001 and 2000, respectively.

5.  Accounting Pronouncements

    In January 2001, the Company adopted Statement of Financial Accounting
    Standards ("SFAS") No. 133, "Accounting for Derivative Instruments and
    Hedging Activities", which was amended by SFAS No. 137 and SFAS No. 138. The
    statement requires that all derivative investments be recorded in the
    balance sheet at fair value. Changes in the fair value of derivatives are
    recorded each period in current earnings or comprehensive income depending
    on whether a derivative is designated as part of a hedge transaction, and
    the type of hedge transaction. The Company's adoption of the statement did
    not have a material effect on its financial statements.

                                       5
<PAGE>

Item 2.               Management's Discussion and Analysis
                of Financial Condition and Results of Operations
                                (March 31, 2000)

     This Quarterly Report on Form 10-Q contains forward-looking statements.
Specifically, any statements contained herein that are not statements of
historical fact may be deemed to be forward-looking statements.  Without
limiting the foregoing, the words "believes," "anticipates," "plans," "expects,"
and similar expressions are intended to identify forward-looking statements.
There are a number of meaningful factors that could cause the Company's actual
results to differ materially from those indicated by any such forward-looking
statements.  These factors include, without limitation, the duration and results
of clinical trials and their effect on the Food & Drug Administration ("FDA")
regulatory process, uncertainties regarding receipt of approvals for any
possible products and any commercial acceptance of such products, possible
difficulties with obtaining necessary patent protection, and uncertainties
regarding the outcome of any of the Company's collaborations or alliances with
third parties.  Other factors include those set forth under the caption
"Forward-Looking Statements" in the Company's Annual Report on Form 10-K for the
year ended December 31, 2000 and the documents referred to under such caption.

Results of Operations

 Overview

     The Company is a biotechnology company engaged in the research and
development of novel therapeutic and diagnostic products to treat chronic
debilitating diseases such as cancer, central nervous system disorders and
autoimmune diseases.  The Company expects that its research and development
costs will continue to increase as the Company attempts to gain regulatory
approval for commercial introduction of its proposed products.  At March 31,
2001, the Company is considered a "development stage enterprise" as defined in
Statement of Financial Accounting Standards No. 7.

 Three Months Ended March 31, 2001 and 2000

     The Company's net loss was $2,121,737 during the three months ended March
31, 2001 as compared with $2,951,150 during the three months ended March 31,
2000.  Net loss per common share equaled $0.10 per share for the 2001 period as
compared to $0.17 per share for the 2000 period.  The lower net loss in the 2001
period was primarily due to higher research and development costs in the 2000
period and interest expense incurred on 8% convertible debentures which were
outstanding during the 2000 period.

     Research and development expenses were $1,744,168 during the three months
ended March 31, 2001 as compared with $1,951,249 during the three months ended
March 31, 2000.  The decrease was primarily attributable to expenditures related
to the Phase III clinical trial for the Altropane imaging agent which was
initiated in March 1999 and which completed trial enrollment in March 2000.
This item was partially offset by higher product manufacturing costs in the 2001
period related to the establishment of a GMP manufacturing process for one
technology and higher pre-clinical manufacturing scale-up costs for another
technology.

     General and administrative expenses were $695,511 during the three months
ended March 31, 2001 as compared with $766,104 during the three months ended
March 31, 2000.  The decrease was primarily related to lower professional
services costs.

     Interest income was $317,942 during the three months ended March 31, 2001
as compared with $111,073 during the three months ended March 31, 2000.  The
increase was primarily due to higher average cash, cash equivalent, and short-
term investment balances during the 2001 period as compared to

                                       6
<PAGE>

the 2000 period which was also adversely affected by the realization of $118,000
of losses on the Company's investment portfolio. Interest expense was zero
during the three months ended March 31, 2001 as compared with $344,870 during
the three months ended March 31, 2000. In September 1999, the Company issued $8
million of 8% convertible debentures which were converted into common stock in
February and March 2000.

Liquidity and Capital Resources

     Since its inception, the Company has primarily satisfied its working
capital requirements from the sale of the Company's securities through private
placements. These private placements have included the sale of preferred stock
and common stock, as well as notes payable and convertible debentures. Each
private placement has included the issuance of warrants to purchase common
stock. A summary of financings completed during the three years ended March 31,
2001 is as follows:

Date                   Net Proceeds Raised           Securities Issued
----                   -------------------           -----------------
June 2000              $9.9 million                  Common stock
September 1999         $7.4 million                  Convertible debentures
February 1999          $2.3 million                  Common stock
February 1999          $5.6 million                  Preferred stock

     In the future, the Company's working capital and capital requirements will
depend on numerous factors, including the progress of the Company's research and
development activities, the level of resources that the Company devotes to the
developmental, clinical, and regulatory aspects of its technologies, and the
extent to which the Company enters into collaborative relationships with
pharmaceutical and biotechnology companies.

  At March 31, 2001, the Company had available cash, cash equivalents and short-
term investments of approximately $18.0 million and working capital of
approximately $16.7 million.  The Company believes that the level of financial
resources available at March 31, 2001 will provide sufficient working capital to
meet its anticipated expenditures for more than the next twelve months.  The
Company may raise additional capital in the future through collaborative
agreements with other pharmaceutical or biotechnology companies, debt financings
and equity offerings.  There can be no assurance, however, that the Company will
be successful or that additional funds will be available on acceptable terms, if
at all.

Accounting Pronouncements

     In January 2001, the Company adopted Statement of Financial Accounting
Standards ("SFAS")  No. 133, "Accounting for Derivative Instruments and Hedging
Activities", which was amended by SFAS No. 137 and SFAS No. 138.  The statement
requires that all derivative investments be recorded in the balance sheet at
fair value.  Changes in the fair value of derivatives are recorded each period
in current earnings or comprehensive income depending on whether a derivative is
designated as part of a hedge transaction, and the type of hedge transaction.
The Company's adoption of the statement did not have a material effect on its
financial statements.

Item 3 - Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes in the market risks reported in the
Company's Annual Report on Form 10-K for the year ended December 31, 2000.

                                       7
<PAGE>

                          PART II -- OTHER INFORMATION
                          ----------------------------


ITEM 1:  LEGAL PROCEEDINGS.
         -----------------

         None.

ITEM 2:  CHANGES IN SECURITIES.
         ---------------------

         None.

ITEM 3:  DEFAULTS UPON SENIOR SECURITIES.
         -------------------------------

         None.

ITEM 4:  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
         ---------------------------------------------------

         None.

ITEM 5:  OTHER INFORMATION.
         -----------------

         (a)  Exhibits.

              None.

Item 6:  EXHIBITS AND REPORTS ON FORM 8-K.
         --------------------------------

         (a)  Exhibits.

              None.

         (b)  Reports on Form 8-K: The Registrant filed the following reports on
              Form 8-K during the quarter ended March 31, 2001: None


                                       8
<PAGE>

                                   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.


                                      BOSTON LIFE SCIENCES, INC.
                                      --------------------------
                                         (Registrant)


DATE:   May 11, 2001                  /s/ S. David Hillson
                                      --------------------
                                      S. David Hillson
                                      President and Chief Executive Officer
                                      (Principal Executive Officer)

                                      /s/ Joseph Hernon
                                      ------------------
                                      Joseph Hernon
                                      Chief Financial Officer
                                      (Principal Financial and Accounting
                                      Officer)

                                       9