UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549
                    ----------------------------------------
                                    FORM 10-Q

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

                      For the quarterly period ended June 30, 2000

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

                      Commission File No. 33-18978

                           TEL-INSTRUMENT ELECTRONICS CORP.
             (Exact name of the Registrant as specified in Charter)

               New Jersey                             22-1441806
          (State of Incorporation)           (I.R.S. Employer ID Number)

          728 Garden Street, Carlstadt, New Jersey             07072
          (Address of Principal Executive Offices)          (Zip Code)

          Registrant's Telephone No. including Area Code: 201-933-1600

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 the number of shares  outstanding of the issuer's  common stock,  as of
the latest practical date:

2,109,957 shares of Common stock, $.10 par value as of August 9, 2000.

<PAGE>


                     TEL-INSTRUMENT ELECTRONICS CORPORATION

                                TABLE OF CONTENTS

                                                                          PAGE
                                                                          ----

Item 1.  Financial Statements (Unaudited):

         Condensed Comparative Balance Sheets
         June 30, 2000 and March 31, 2000                                   1

         Condensed Comparative Statements of Operations -
         Three Months Ended June 30, 2000 and 1999                          2

         Condensed Comparative Statements of Cash Flows -
         Three Months Ended June 30, 2000 and 1999                          3

         Notes to Condensed Financial Statements                            4-5

Item 2.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations                                6-8

         SIGNATURES                                                         9

<PAGE>

Item 1 - Financial Statements

                     TEL-INSTRUMENT ELECTRONICS CORPORATION
                      CONDENSED COMPARATIVE BALANCE SHEETS

<TABLE>
<CAPTION>
                                                          (Unaudited)       (Audited)
                       ASSETS                                June 30,       March 31,
                                                                2000            2000
                                                          ------------     ---------
<S>                                                       <C>            <C>
Current assets:
   Cash                                                   $   120,620    $   172,836
  Accounts receivable, net of allowance for doubtful
      accounts of $11,598 at June 30, 2000 and
      at March 31, 2000                                     1,354,931      1,099,425
  Inventories                                               1,490,945      1,486,885
  Prepaid expenses and other current assets                    47,850         56,020
  Deferred income tax benefit - current                       215,000        215,000
                                                          -----------    -----------
Total current assets                                        3,229,346      3,030,166

Property, plant and equipment, net                            328,713        350,872
Other assets                                                   34,778         28,628
Deferred income tax benefit                                   466,892        523,099
                                                          -----------    -----------
Total assets                                                4,059,729      3,932,765
                                                          ===========    ===========

      LIABILITES & STOCKHOLDERS EQUITY

Current liabilities:
  Note payable - related party - current portion              150,000        150,000
  Note payable - bank                                         250,000        250,000
  Convertible subordinated notes - related party               15,000         15,000
  Capitalized lease obligations - current portion              58,063         56,376
  Advance payments                                            141,824        176,193
  Accrued payroll, vacation pay, deferred wages
      payroll taxes and interest on deferred wages            463,658        350,286
  Accounts payable and accrued expenses                     1,088,762      1,111,181
                                                          -----------    -----------
Total current liabilities                                   2,167,307      2,109,036

Notes payable - related party - non-current portion           200,000        200,000
Capitalized lease obligations - excluding current port         85,224        101,682
                                                          -----------    -----------
Total liabilities                                           2,452,531      2,410,718

Stockholders' equity:
   Common stock                                               211,372        211,332
   Additional paid-in capital                               3,928,545      3,927,921
   Accumulated deficit                                     (2,532,719)    (2,617,206)
                                                          -----------    -----------
Total stockholders' equity                                  1,607,198      1,522,047
                                                          -----------    -----------
Total liabilities and stockholders' equity                $ 4,059,729    $ 3,932,765
                                                          ===========    ===========
</TABLE>

See accompanying notes to condensed financial statements


                                       1
<PAGE>

                     TEL-INSTRUMENT ELECTRONICS CORPORATION
                 CONDENSED COMPARATIVE STATEMENTS OF OPERATIONS
                                   (Unaudited)

                                                Three Months Ended
                                                     June 30,
                                                2000         1999
                                            ----------    ----------

Sales - government, net                     $  917,113    $  553,428
Sales - commercial, net                        572,890       558,401
                                            ----------    ----------
Total sales                                  1,490,003     1,111,829

Cost of sales                                  786,709       465,424
                                            ----------    ----------

Gross margin                                   703,294       646,405

Operating expenses:
   Selling, general and administrative         353,443       290,559
   Engineering, research and development       181,998       278,443
                                            ----------    ----------
Total operating expenses                       535,441       569,002
                                            ----------    ----------

Income from operations                         167,853        77,403

Other income (expenses):
   Interest income                               3,454         1,615
   Interest expenses                           (30,613)      (13,588)
                                            ----------    ----------

Income before taxes                            140,694        65,430

Provision for income taxes                      56,207        26,140
                                            ----------    ----------

Net income                                      84,487        39,290
                                            ==========    ==========

Basic and diluted income per common share   $     0.04    $     0.02
                                            ==========    ==========

Dividends per share                               None          None

Weighted average shares outstanding:
          Basic                              2,113,390     2,109,957
          Diluted                            2,146,183     2,119,452

See accompanying notes to condensed financial statements


                                       2
<PAGE>

                     TEL-INSTRUMENT ELECTRONICS CORPORATION
                 CONDENSED COMPARATIVE STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                   Three Months Ended
                                                                        June 30,
                                                                   2000         1999
                                                                ---------    ----------
<S>                                                             <C>             <C>
(Decrease) increase in cash:

Cash flows from operating activities:
Net income                                                      $  84,487       39,290
Adjustments to reconcile net income to cash used
      in operating activities:
        Deferred income taxes                                      56,207       26,140
        Depreciation                                               23,045       13,274

Changes in assets and liabilities:
    Increase in accounts receivable                              (255,506)    (233,144)
    Increase in inventories                                        (4,060)    (216,154)
    Decrease (increase) in prepaid expenses                         8,170       (3,957)
        and other current assets
    Increase in other assets                                       (6,150)        (364)
    Increase in accrued payroll, deferred wages
       and vacation pay                                           113,372       45,692
    (Decrease) increase in accounts payable, advance payments
       and accrued expenses                                       (56,788)      77,427
                                                                ---------    ---------
Net cash used in operations                                       (37,223)    (251,796)
                                                                ---------    ---------

Cash flows from investing activities:
   Cash purchases of property, plant and equipment                   (886)     (12,911)
                                                                ---------    ---------
Net cash used in investing activities                                (886)     (12,911)
                                                                ---------    ---------

Cash flows from financing activities:
    Proceeds from the exercise of stock options                       664         --
    Proceeds from notes payable - bank                               --        250,000
    Repayment of capitalized lease obligations                    (14,771)      (2,079)
                                                                ---------    ---------

Net cash (used in) provided by financing activities               (14,107)     247,921
                                                                ---------    ---------

Net decrease in cash                                              (52,216)     (16,786)
Cash at beginning of period                                       172,836       70,617
                                                                ---------    ---------

Cash at end of period                                           $ 120,620    $  53,831
                                                                =========    =========
</TABLE>

See accompanying notes to condensed financial statements


                                       3
<PAGE>

                        TEL-INSTRUMENT ELECTRONICS CORP.

                     NOTES TO CONDENSED FINANCIAL STATEMENTS

Note 1  Basis of Presentation

In the opinion of management,  the accompanying  unaudited  condensed  financial
statements  contain  all  adjustments   (consisting  only  of  normal  recurring
accruals)  necessary to present fairly the financial  position of Tel-Instrument
Electronics  Corp. as of June 30, 2000,  the results of operations for the three
months ended June 30, 2000 and June 30, 1999,  and  statements of cash flows for
the three months ended June 30, 2000 and June 30,  1999.  These  results are not
necessarily indicative of the results to be expected for the full year.

The financial  statements have been prepared in accordance with the requirements
of Form 10-Q and  consequently  do not include  disclosures  normally made in an
Annual Report on Form 10-K. The March 31, 2000 results included herein have been
derived from the audited financial  statements  included in the Company's annual
report on Form 10-K.  Accordingly,  the  financial  statements  included  herein
should be  reviewed  in  conjunction  with the  financial  statements  and notes
thereto included in the Company's Annual Report on Form 10-K for the fiscal year
ended March 31, 2000.

Note 2   Accounts Receivable

The following table sets forth the components of accounts receivable:

                                            June 30,     March 31,
                                             2000          2000
                                             ----          ----
         Commercial                     $   303,400    $   345,209
         Government                       1,063,129        765,814
         Allowance for bad debts            (11,598)       (11,598)
                                        -----------    -----------

         Total                          $ 1,354,931    $ 1,099,425
                                        ===========    ===========

Note 3  Inventories

Inventories consist of:

                                                      June 30,      March 31,
                                                        2000          2000
                                                     ------------------------
                Purchased parts                     $  898,912    $  921,185
                Work-in-process                        618,771       609,824
                Less: Reserve for obsolescence         (26,738)      (44,124)
                                                    ------------------------
                                                    $1,490,945    $1,486,885
                                                    ========================


                                       4
<PAGE>

                        TEL-INSTRUMENT ELECTRONICS CORP.

               NOTES TO CONDENSED FINANCIAL STATEMENTS (Continued)

Note 4  Income Taxes

The Company,  in accordance  with FASB 109, has recognized a deferred income tax
benefit based upon the expected  utilization of net operating loss carryforwards
as the Company  believes  that it is more likely than not that it will realize a
portion of its operating  losses before they expire.  For the three months ended
June 30, 2000, the Company recorded a tax provision of $56,207, which represents
the  effective  federal and state tax rate on the  Company's  net income  before
taxes of  $140,694.  The  Company  has no federal  tax  liability.  The  $56,207
decreased  the Company's  deferred  income tax benefit by the same amount in the
accompanying  balance sheet. The Company expects to utilize this deferred income
tax benefit in the future for tax reporting purposes.

Note 5  Earnings Per Share

The  Company's  basic  income per share is based on net income for the  relevant
period,  divided by the weighted  average  number of common  shares  outstanding
during the period.  Diluted income per share is based on net income,  divided by
the weighted  average  number of common  shares  outstanding  during the period,
including common share equivalents, such as outstanding stock options.

Note 6  Government and Commercial Sales

In 1999, the Company adopted SFAS 131.  Presented below is information about the
Company's government and commercial activities.

The Company is organized  primarily on the basis of its avionics  products.  The
government  market consists  primarily of the sale of test equipment to U.S. and
foreign  governments and militaries either direct or through  distributors.  The
commercial  market  consists of sales of test  equipment to domestic and foreign
airlines and to  commercial  distributors.  The Company  primarily  develops and
designs test  equipment for the avionics  industry  and, as such,  the Company's
products and designs may be sold in the government and commercial markets.

The table below presents information about sales and gross margin. Cost of sales
includes certain allocation factors for indirect costs.

                             Three Months Ended          Three Months Ended
                               June 30, 2000                June 30, 1998
                          Government     Commercial    Government    Commercial
                          ----------     ----------    ----------    ----------
         Sales             $917,113        572,890      $553,428       558,401

         Cost of sales      496,744        289,965       233,966       231,458
                           --------        -------      --------       -------

         Gross margin      $420,369        282,925       319,462       326,943
                           ========        =======       =======       =======


                                       5
<PAGE>

Item 2.  MANAGEMENT'S  DISCUSSION  AND ANALYSIS OF THE RESULTS OF OPERATIONS AND
         FINANCIAL CONDITION

Results of Operations

A number of the statements made by the Company in this report may be regarded as
"forward-looking  statements"  within  the  meaning  of the  Private  Securities
Litigation Reform Act of 1995.

Forward-looking  statements  include,  among others,  statements  concerning the
Company's outlook, pricing trends and forces within the industry, the completion
dates of capital projects,  expected sales growth, cost reduction strategies and
their  results,   long-term  goals  of  the  Company  and  other  statements  of
expectations, beliefs, future plans and strategies, anticipated events or trends
and similar expressions concerning matters that are not historical facts.

All  predictions  as to future  results  contain a measure  of  uncertainty  and
accordingly,  actual  results  could differ  materially.  Among the factors that
could cause a difference are: changes in the general economy;  changes in demand
for the Company's products or in the cost and availability of its raw materials;
the  actions of its  competitors;  the success of our  customers;  technological
change;  changes in  employee  relations;  government  regulations;  litigation,
including  its  inherent  uncertainty;  difficulties  in  plant  operations  and
materials;   transportation;   environmental   matters;   and  other  unforeseen
circumstances.  A number of these factors are discussed in the Company's filings
with the Securities and Exchange Commission.

Overview

In June 2000,  deliveries of the AN/APM-480 IFF (Identification,  Friend or Foe)
Transponder  Set Test Set  (TSTS ) to the  U.S.  Navy  began.  The  Company  has
received  orders for more than 960  units,  totaling  over  $12.5  million to be
delivered  over the  next  three  to four  fiscal  years.  The  AN/APM-480  is a
militarized avionics ramp tester used to simulate IFF Transponder/  Interrogator
and TCAS (collision  avoidance)  functions to provide accurate go, no-go testing
of avionics  equipment  installed in U.S.  Navy aircraft on the  flightline  and
aircraft carrier deck.

The  Company  has also  received  an order  for  commercial  avionics  test sets
exceeding $900,000 from a major freight carrier through a domestic  distributor,
which the Company expects to ship during the current fiscal year. In,  addition,
the  Company  shipped  all of the T-76  Precision  DME Ramp Test Sets  under the
contract with Marconi  Communications  through its Italian intermediary,  M.P.G.
Instruments s.r.l. Precision DME is directed solely to the European market.

For the first quarter of fiscal year 2001 sales increased 34% to $1,490,003, and
net income before taxes more than doubled to $140,694,  as compared to the first
quarter of the prior fiscal year.

The Company's backlog at June 30, 2000,  including the production order from the
U.S. Navy of approximately $12,250,000 million, exceeds $16,500,000. The Company
expects to ship the backlog over the next three to four fiscal years.


                                       6
<PAGE>

Item 2.  MANAGEMENT'S  DISCUSSION  AND ANALYSIS OF THE RESULTS OF OPERATIONS AND
         FINANCIAL CONDITION (continued)

Sales

For the three months ended June 30, 2000, net sales increased  $378,174  (34.0%)
as compared to the three months ended June 30, 1999.  Commercial sales increased
$14,489 (2.6%) and government sales increased $363,685 (65.7%).  The increase in
sales is primarily  attributed  to the shipment of the T-76  Precision  DME Ramp
Tests  under the  contract  with  Marconi  Communications  through  its  Italian
intermediary,  M.P.G. Instruments s.r.l., and the shipment of the AN/APM-480 IFF
(Identification,  Friend  or Foe)  Transponder  Set Test Set  (TSTS) to the U.S.
Navy. These increases were partially offset by lower sales of the T-47 family of
IFF test sets.

Gross Margin

Gross margin  dollars  increased  $56,889 (8.8%) for the three months ended June
30, 2000 as  compared to the same three  months in the prior  fiscal  year.  The
increase in gross  margin,  for the most part,  is  attributed to an increase in
sales volume.  However,  gross margin,  as a percentage of sales, was reduced by
the introduction of new products,  such as the T-76 and the AN/APM-480,  and the
associated   learning   curve  in  building  and  testing  these  new  and  more
sophisticated  products,  and the lower gross profit on the T-76 and  AN/APM-480
contracts.  The gross margin percentage for the three months ended June 30, 2000
was 47.2% as compared to 58.1% for the three months ended June 30, 1999.

Operating Expenses

Selling,  general and administrative  expenses increased $62,884 (21.6%) for the
three  months ended June 30, 2000 as compared to the three months ended June 30,
1999.  This  increase is  attributed  to higher  sales and  marketing  expenses,
including  hiring  a  Director  of  Business  Development,  and an  increase  in
salaries.

Engineering,  research and development expenses decreased $96,445 (34.6%).  This
decrease is associated with  activities that were funded through  contracts and,
therefore, are included in the cost of sales.

Income Taxes

In accordance  with SFAS 109, a provision for income taxes was recognized in the
amount of $56,207 for the three months ended June 30, 2000, which represents the
effective  federal and state tax rate on the  Company's net loss before taxes of
$140,694.  The Company  currently does not have any federal tax liability.  (See
Note 4 to Notes to Condensed Comparative Financial Statements).


                                       7
<PAGE>

Item 2.  MANAGEMENT'S  DISCUSSION  AND ANALYSIS OF THE RESULTS OF OPERATIONS AND
         FINANCIAL CONDITION (continued)

Liquidity and Capital Resources

At June 30, 2000 the Company had  positive  working  capital of  $1,062,309,  as
compared to  $921,130 at March 31,  2000.  For the three  months  ended June 30,
2000,  cash used in operations was $37,223 as compared to $251,796 for the three
months  ended  June 30,  1999.  This  reduction  in cash used in  operations  is
primarily  attributed to the improvement in the Company's  operating  income, an
increase  in  liabilities,  and the fact that  inventories  have  only  slightly
increased from the March 31, 2000 level.

In August 2000, the Company received a commitment  letter from Summit Bank under
terms that will  increase the  Company's  available  credit to $600,000 from its
previous  limit of  $250,000.  The line of credit  bears an interest  rate of 1%
above the lender's  prevailing base rate, which is payable  monthly,  based upon
the  outstanding  balance.  At June 30,  2000,  the Company  had an  outstanding
balance of $250,000.  The line of credit is  collateralized by substantially all
of the assets of the  Company and  expires in June 2001.  This  credit  facility
requires the Company to maintain certain financial covenants. As of June 30, the
Company was in compliance with all financial covenants.

During the first quarter of the current  fiscal year, the Company began shipping
AN/APM-480s  to the  U.S.  Navy  and  delivered  all the T-76  Ramp  Test  Sets.
Management  believes  that these events will have a positive  effect on its cash
flow.

Based upon the current backlog,  available line of credit, and cash balance, the
Company  believes that it has sufficient  working  capital to fund its plans for
the next twelve months. At present, the Company does not anticipate  significant
long-term needs for capital outside its normal operating activities.

There was no  significant  impact  on the  Company's  operations  as a result of
inflation for the three months ended June 30, 2000.

These  financial  statements  should be read in  conjunction  with the Company's
annual Report on Form 10-K to the  Securities  and Exchange  Commission  for the
fiscal year ended March 31, 2000.

New Accounting Pronouncement

Staff  Accounting  Bulletin 101 ("SAB 101"),  Revenue  Recognition  in Financial
Statements,  was issued on December 3, 1999 with an original  effective  date of
the first fiscal quarter of fiscal years  beginning after December 15, 1999. SAB
101  provides  guidance on the  recognition,  presentation,  and  disclosure  of
revenue in financial  statements  filed with the SEC. On June 26, 2000,  the SEC
staff issued SAB 101B to provide  registrants  with additional time to implement
guidance  contained in SAB 101. SAB 101B delays the  implementation  date of SAB
101 until no later than the fourth  fiscal  quarter  of fiscal  years  beginning
after  December 15, 1999.  This provides an additional  six months for companies
with fiscal year ends in December,  January,  or February.  Companies with other
fiscal year ends will have an  additional  nine  months.  The  Company  does not
believe  that  implementation  of SAB 101 will  have a  material  impact  on its
financial statements.


                                       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.

                                          TEL-INSTRUMENT ELECTRONICS CORP.

Date:    August 14, 2000                  By: /s/ Harold K. Fletcher
                                              ----------------------
                                              /s/ Harold K. Fletcher
                                              Chairman and President

Date:   August 14, 2000                   By:  /s/ Joseph P. Macaluso
                                              ----------------------
                                              /s/ Joseph P. Macaluso
                                              Principal Accounting Officer