U.S. SECURITIES AND EXCHANGE COMMISSION
                         Washington, D.C. 20549

                                __________


                               FORM 10-QSB


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



   For the quarterly period ended:                Commission file number:
           June 30, 1997                                  0-26614



                                 ___________


                                  MVSI, INC.
           (Name of Small Business Issuer as Specified In Its Charter)



              Delaware                                52-1707718
(State or other jurisdiction of                    (I.R.S. Employer
 incorporation or organization)                    Identification No.)

       8133 Leesburg Pike, Suite 750, Vienna, VA          22182
       (Address of principal executive offices)         (Zip code)




                               (703) 356-5353
             (Company's telephone number, including area code)


                                 ___________



    Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 past 90 days.
 Yes __X__  No ____


    As of June 30, 1997, 10,875,500 shares of the Registrant's Common Stock,
$.01 par value, were outstanding. 


<PAGE>

                                    MVSI, INC.


                                      INDEX




PART I.   FINANCIAL INFORMATION                               Page

    Item 1. Financial Statements                                3

    Item 2. Management's Discussion and Analysis
            of Financial Condition and Results of 
            Operations.                                         14



PART II.  OTHER INFORMATION

    Item 6. Exhibits and Reports on Form 8-K.                   17



SIGNATURES                                                      18











<PAGE>

PART I.  FINANCIAL INFORMATION

Item 1:  Financial Statements

MVSI, Inc. and Subsidiaries

Contents


Interim Consolidated Financial Statements

          Interim Consolidated Balance Sheets                         4

          Interim Consolidated Statements of Operations               5

          Interim Consolidated Statements of Cash Flows               7

          Notes to Interim Consolidated Financial Statements          8



<PAGE>

MVSI, Inc. and Subsidiaries

Interim Consolidated Balance Sheets

                          									          June 30	       September 30,
	                                              1997	     	      1996	
-----------------------------------------------------------------------------
Assets						                           			 (Unaudited)        (Audited)

Current Assets
	Cash and cash equivalents               	$		1,723,350      	$		313,890
	Marketable securities			                    2,705,179	     		5,881,202
	Accounts receivable, net of allowance
 for doubtful accounts                    			5,189,307		     	4,555,259
	Note receivable		                                	-         			500,000
	Inventory	                                		4,307,822		     	2,612,539
	Tax credits and income tax receivable      			579,191	       		405,717
	Prepaid expenses                           			223,138	       		348,302
                                          ------------       -----------
Total Current Assets	                     		14,727,987	    		14,616,909

Property and Equipment, net                 			608,900	       		383,518

Capitalized Software Costs	                		1,572,025	     		1,164,182

Goodwill	                                  		3,309,745	     		2,735,638

Deferred Tax Asset	                        		1,955,046	     		1,158,430

Other Assets	                                		131,472	       		101,692
                                          -------------      -----------
                                     				$		22,305,175   	$		20,160,369
____________________________________________________________________________
Liabilities and Stockholders'Equity

Current Liabilities
	Line of credit and financing
   arrangements                          $   		821,822    $  	1,099,973
	Accounts payable and accrued liabilities 			3,548,520	       3,731,763
	Shareholder loans and interest		             	795,752	       		222,395
                                          -------------   --------------- 
Total Current Liabilities		                 	5,166,094		     	5,054,131

Stockholders' Equity
	Common stock, $.01 par value,
   50,000,000 shares authorized,
   11,055,000 and 10,740,000 shares
   issued, respectively	                     		110,500         	107,400
	Stock subscription receivable	             		(150,000)	     		(150,000)
	Additional paid-in capital		              	21,701,891	     	20,577,566
	Accumulated deficit		                     	(3,450,936)	   		(5,475,602)
	Unrealized loss on investments
   available for sale	                      		(415,767)      			(59,786)
	Cumulative translation adjustment          			(83,997)      			106,660
	Treasury stock, at cost, 179,500 and
   0 shares, respectively	                  		(572,660)		         	  -   
                                           -------------    --------------
Total Stockholders' Equity	               		17,139,081			    15,106,238
                                           -------------    --------------  
                                        $	 	22,305,175	   $		20,160,369
____________________________________________________________________________
The accompanying notes are an integral part of these statements.


<PAGE>

MVSI, Inc. and Subsidiaries

Interim Consolidated Statements of Operations


Three Months ended June 30,	                          1997		        1996
								                                          	(Unaudited)	  (Unaudited)

Sales	                                       			$		11,680,087 	$		3,250,354
Cost of Sales	                                    		9,651,797	  		2,372,117
                                                -------------  ------------- 
Gross Profit	                                     		2,028,290	    		878,237

Expenses
	Selling                                          				509,211	    		118,008
	Administrative	                                     	808,066		    	421,351
	Research and development, net of tax credits		      	155,671		     	39,345
	Depreciation and amortization		                     	153,235	     		27,283
                                                --------------  ------------  
                                             							1,626,183	    		605,987

Earnings from Operations                           			402,107	    		272,250

Interest Income	                                    		115,832	    		108,036
Interest and Financing Charges	                     		(83,036)	   		(21,875)
                                                --------------  -------------

Earnings Before Income Taxes	                       		434,903    			358,411

Income Tax (Benefit) Provision 
	Current	                                           			45,000	         		-  
	Deferred			                                        	(426,532)	  		(224,265)
                                                --------------  -------------
                                              							(381,532)	  		(224,265)
                                                --------------  -------------

Net Earnings 	                                     $		816,435   	$		582,676
_____________________________________________________________________________

Earnings per Share	
	Primary	                                            	$		0.07      	$		0.05

	Fully diluted                                       	$ 	0.07      	$		0.05
_____________________________________________________________________________


The accompanying notes are an integral part of these statements.


<PAGE>

MVSI, Inc. and Subsidiaries

Interim Consolidated Statements of Operations


Nine Months ended June 30,	                             199	         1996	
							                                           		(Unaudited)	 (Unaudited)

Sales	                                         			$	29,849,901  $	9,858,955

Cost of Sales	                                    		24,009,551	 		6,826,698
                                                  ------------  ------------
Gross Profit	                                      		5,840,350	  	3,032,257

Expenses
	Selling	                                         			1,521,804	   		353,265
	Administrative		                                   	2,358,251	 		1,569,709
	Research and development, net of tax credits	       		317,824	   		190,758
	Depreciation and amortization	                      		316,169	    		73,294
                                                  ------------  ------------    
                                                    	4,514,048		 	2,187,026
                                                  ------------  ------------

Earnings from Operations		                          	1,326,302   			845,231

Interest Income	                                     		432,166	   		354,656
Interest and Financing Charges		                     	(207,405)  			(39,326)
                                                  ------------  ------------

Earnings Before Income Taxes                      			1,551,063	 		1,160,561

Income Tax (Benefit) Provision 
	Current		                                            	135,000		        	-  
	Deferred	                                         			(608,603) 			(224,265)
                                                  ------------  ------------  
                                               							(473,603)		 	(224,265)
                                                  ------------  -----------
Net Earnings                                     	$		2,024,666 	$	1,384,826
_____________________________________________________________________________

Earnings per Share	
	Primary	                                             	$		0.17     	$		0.13

	Fully diluted                                         $ 	0.17     	$		0.12
_____________________________________________________________________________

The accompanying notes are an integral part of these statements.



<PAGE>

MVSI, Inc. and Subsidiaries

Interim Consolidated Statements of Cash Flows

Nine Months ended June 30,	                              1997        1996
								                                        	    (Unaudited)		(Unaudited)
Increase (Decrease) in Cash and Cash Equivalents

Cash Flows from Operating Activities
	Net income 		                                    	$		2,024,666	 $		1,384,826
	Adjustments to reconcile net income to net cash 
		from operating activities,
		Deferred income taxes	                             		(532,503)	  		(224,265)
		Depreciation and amortization			                      316,169	     		60,539
		Unrealized loss on investments	                     		355,980	     		    -  
		(Gain) loss on foreign exchange		                       	(743)	    		39,882
		Changes in operating assets and liabilities,
  net of effects of acquisition
			 Decrease (increase) in accounts receivable	       		527,249	 		(1,570,635)
			(Increase) in inventory	                            (770,616)	  		(411,583)
			(Increase) in tax credits and income
     taxes receivable	                               		(146,271)	    		(1,130)
		 	Decrease in prepaid expenses	                      		92,181	     		41,665
			(Increase) in other assets		                         	(5,855)	   		(32,167)
			(Decrease) in accounts payable and accrued
    liabilities	                                   		(1,952,006)     (980,224)
                                                    ------------  -----------
Net Cash (Used in) Operating Activities		              	(91,749)			(1,693,092)

Cash Flows from Investing Activities
	Borrowings on margin against investments	           	3,676,023       400,836
	Property, plant and equipment purchases		            	(260,917)	   		(33,930)
	Capitalized software costs		                         	(407,843)	  		(763,258)
	Investment in e-Net, Inc.		                          	(915,000)	        		-  
                                                    ------------  -----------
Net Cash Provided by (Used in) Investing Activities  	2,092,263	   		(396,352)

Cash Flows from Financing Activities
	Net (decrease) increase in line of credit	          		(274,156)	   		232,011
	Proceeds from shareholder loans		                     	201,920			         -  
	Payment of shareholder loans                             			-    			(524,000)
	Payment of debt			                                         	-     			(11,654)
	Purchase of treasury stock		                         	(572,660)        			-  
	Proceeds from issuance of common stock	                  		150	    		600,000
	Proceeds from conversion of warrants	                 		59,850       			  -  
                                                     -----------  -----------
Net Cash (Used in) Provided by Financing Activities		 	(584,896)	   		296,357

Effect of Exchange Rate Changes on Cash	               		(6,158)	    		29,978
                                                     -----------  -----------

Net Increase (Decrease) in Cash	                    		1,409,460 			(1,763,109)
Cash at Beginning of Period	                          		313,890	  		2,343,036
                                                     -----------  -----------
Cash at End of Period                             	$		1,723,350   	$		579,927
                                                     ===========  ===========

The accompanying notes are an integral part of these statement


MVSI, Inc. and Subsidiaries

Notes to Interim Consolidated Financial Statements


June 30, 1997

NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES

The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles and
with the instructions to Form 10-QSB.  Accordingly, they do not include all
of the information and footnotes required by generally accepted accounting
principles for complete financial statements.  In the opinion of management,
all adjustments considered necessary for a fair presentation have been included.
The results of operations for the nine months and three months ended June 30,
1997 are not necessarily indicative of the results to be expected for the
full year.  For further information, refer to the financial statements and
footnotes included in the Company's audited financial statements for the
fiscal year ended September 30, 1996.


NOTE B--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying interim consolidated financial statements include the
accounts of MVSI, Inc. (a Delaware corporation), and its three wholly owned
subsidiaries: MVS Modular Vision Systems, Inc. (MVS-Canada), a Montreal,
Quebec-based corporation engaged in the design and manufacture of
proprietary machine vision products and systems; Socrates, Inc.(Socrates),
a Gaithersburg, Maryland-based corporation, which integrates,installs and 
supports high-end computer and communication equipment; JMR Distributors,
Inc. (JMR), a Lorton, Virginia-based corporation specializing in the
purchase and sale of computer memory chips and network equipment; and
Expert, Inc. (Expert), a Fresh Meadows, New York-based corporation which 
contract manufactures and markets proprietary and generic computer systems
products and services for advanced computer systems integration and networking
(collectively referred to as the "Company").  The results of operations of
Socrates are included in the accompanying financial statements since the
July 1, 1996 acquisition date and the results of Expert are included in the
accompanying financial statements since the April 1, 1997 acquisition date.
Significant intercompany accounts and transactions have been eliminated in
consolidation.

Revenue Recognition

Sales are recognized upon shipment of a finished product when title to the
product transfers to the customer.  Typical terms of sale do not provide the
customer with the right of return except for defective products, which are
covered by the Company's warranty.  Revenue billed in advance of customer
acceptance is deferred until such time as acceptance occurs.  Amounts
received from customers prior to shipment are recorded as deposit liabilities.

Cash and Cash Equivalents

Cash and cash equivalents include cash and money market accounts.

Marketable Securities

Marketable securities consist of short-term U.S. treasury notes, net of
margin loans which bear interest at 7 1/2 percent, and the Company's equity
investment in e-Net, Inc.  In accordance with Statement of Financial
Accounting  Standards  No. 115,  the  Company has  classified  these

<PAGE>


MVSI, Inc. and Subsidiaries

Notes to Interim Consolidated Financial Statements--Continued


June 30, 1997

NOTE B--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--Continued

Marketable Securities - Continued

securities as available-for-sale,  and  recorded the securities at fair
value, based on quoted market prices, with the unrealized gains or losses,
reported in stockholders' equity at June 30, 1997 and 1996.  The Company
has not realized any proceeds from the sale of securities during the three
months ended June 30, 1997 and 1996. 

Accounts Receivable

Accounts receivable are stated at the unpaid balances, less allowance on
collectible accounts. Management periodically reviews its outstanding
accounts receivable to assess collectibility of balances based on past
experience and evaluation of current adverse situations which may affect
collectibility of receivables.  As of  June 30, 1997, management has
established an allowance for doubtful accounts of approximately $93,000.  

Inventory Valuation

Inventory is valued at the lower of cost and market.  Cost is determined
on a first-in, first-out (FIFO) basis.

Management evaluates obsolete and slow-moving inventory at each reporting
date and excludes such inventory from the valuation.  Management has
recorded a $40,000 reserve to record inventory obsolescence at June 30,
1997.  The value of inventories written off because of obsolescence or slow
movement has not been material to date.

Property and Equipment

Property and equipment are carried at cost, net of an allowance for
accumulated depreciation and amortization.  Depreciation is computed on
equipment and furniture, principally using the double-declining balance
method over estimated lives ranging from five to seven years. Demonstration
and research equipment is depreciated on a straight-line basis over a
four-year period.  Leasehold improvements are amortized on a straight-line
basis over the shorter of the lease term or estimated useful lives of the
related assets.

Capitalized Software Costs

Beginning in fiscal year 1995, certain software development costs not
reimbursed by the Canadian government have been capitalized in accordance
with Statement of Financial Accounting Standards No. 86.  Software
development costs incurred subsequent to achievement of technological
feasibility, and not reimbursed by the Canadian government, were not
material in previous years.  Technological feasibility occurs when the
Company has completed all planning and testing activities necessary to
establish that the product can be produced to meet its design specifications,
including functions, features and technological performance requirements.
No amortization had been recorded in the accompanying financial statements
prior to the current fiscal year, pending release of the associated products.
Several products became available for sale during the three months ended
June 30, 1997.  Accordingly, the Company began amortizing the associated
capitalized software costs and recorded amortization expense of
approximately $35,000 in the accompanying financial statements for


<PAGE>

MVSI, Inc. and Subsidiaries

Notes to Interim Consolidated Financial Statements--Continued

June 30, 1997

NOTE B--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--Continued

Capitalized Software Costs - Continued 

the three months ended June 30, 1997.  When additional products are ready
for sale,  the Company will continue its policy of amortizing capitalized
software costs by the greater of (a) the ratio the current gross revenue
for a product bears to the total current and anticipated future gross
revenue for that product or (b) the straight-line method over the remaining
economic life of the product including the period being reported on.
It is reasonably possible that those estimates of anticipated future gross
revenue, the remaining estimated economic life of the product, or both will
be reduced significantly in the near term.  As a result, the carrying amount
of the capitalized software costs may be reduced materially in the near term.

Goodwill

Goodwill represents the excess of cost over the fair value of net assets
acquired in business combinations accounted for as purchases.  Goodwill is
being amortized on the straight-line method over ten years.  Amortization
expense charged to operations for the nine months ended June 30, 1997 and
1996 was $230,893 and $34,350, respectively.

Research and Development Costs

Research and development costs are expensed as incurred.  The Company,
however, is eligible to receive tax credits for certain research and
development costs incurred from both the Canadian federal government and the
Province of Quebec. Tax credits received or due from the Canadian federal
government for research and development costs incurred can be realized only
as an offset to future taxes payable from income generated in Canada.
These tax credits can be carried forward up to ten years from the date
generated.

Tax credits received or due from the Province of Quebec for research and
development costs incurred have been offset against current research and
development expenditures and are included as a receivable in the
accompanying balance sheet, as such amounts are currently refundable in
cash in the year following the year in which they are incurred.

Equipment used in research and development activities which has alternative
future uses is capitalized and depreciated.

Income Taxes

The Company has net operating loss carryforwards and tax credit
carryforwards to offset future taxable income and taxes payable. Although
the Company has recognized income before income taxes through June 30, 1997,
this has not resulted in the recognition of income tax expense due to the
existence of available net operating loss carryforwards.  Deferred taxes
are recognized, subject to a valuation allowance, for temporary differences
in the timing of recognition of certain income and expenses.

Earnings Per Share

Earnings per share (EPS), both primary and fully diluted, are computed,
under the modified treasury stock method for the nine months and three
months ended  June 30, 1997 and 1996.


<PAGE>

MVSI, Inc. and Subsidiaries

Notes to Interim Consolidated Financial Statements--Continued


June 30, 1997


NOTE B--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--Continued

Earnings Per Share-Continued

Under the modified  treasury  stock method,  earnings per  share are based
on the weighted average number of shares actually outstanding plus the
shares that would be outstanding assuming conversion, at the beginning of
the year, of the Company's Class A and Class B warrants which are considered
to be common stock equivalents.  The number of shares that would be issued
from the assumed exercise of the warrants has been reduced by the number of 
shares that could have been purchased from the proceeds, at the average
market price (primary EPS) of the Company's stock for the three months and
nine months ended June 30, 1997 and 1996, and at the closing market price
(fully diluted EPS) for the three months and nine months ended June 30, 1997
and 1996, subject to a 20% limitation.  Once the proceeds have been applied to
purchase common stock up to 20% of the outstanding common stock, the balance
of the proceeds are assumed to be invested in government securities.
Accordingly, net earnings (for both primary and fully diluted EPS) have
been adjusted for interest revenue, net of tax, from the assumed purchase of
government securities with the excess proceeds.  The weighted average number
of common and common equivalent shares used in the primary and fully diluted
EPS computations were 15,005,576 and 15,355,736 for the three months ended
June 30, 1997 and 1996, respectively, and 14,801,261 and 15,339,446 for the
nine months ended June 30, 1997 and 1996, respectively. 

Using Estimates in Preparing Financial Statements

In preparing financial statements in conformity with generally accepted
accounting principles, management is required to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
the disclosure of contingent assets and liabilities at the date of the 
financial statements and revenue and expenses during the reporting period.
Actual results could differ from those estimates.


Reclassifications

Certain prior period amounts have been reclassified to conform to the
current period presentation.


Fair Value of Financial Instruments

The following methods and assumptions were used to estimate the fair value
of each class of financial instruments for which it is practicable to
estimate the value:

The carrying amount approximates fair value for cash and cash equivalents,
accounts receivable, notes receivable, accounts payable, line of credit
and other accrued liabilities.

Investment securities classified as current assets are based on quoted
market price.


Translation of Foreign Currency and Concentration of Credit Risk

A portion of the Company's operations are transacted in Canadian dollars.
The balance sheet

<PAGE>

MVSI, Inc. and Subsidiaries

Notes to Interim Consolidated Financial Statements--Continued

June 30, 1997


NOTE B--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--Continued

Translation of Foreign Currency and Concentration of Credit Risk-Continued

of Canadian operations is translated into U.S. dollars at the year-end rate
of exchange, and all statement of operations items are translated at the
weighted average exchange rates for the year.  The resulting translation
adjustments are made directly to a separate component of stockholders'
equity.

The Company's customers are not concentrated in any specific geographic
region.  As a matter of policy, the Company requires its larger customers
to furnish letters of credit (and in some instances, advance deposits) to
minimize credit risk to the Company after shipment of the products.  For
other customers, the Company reviews a customer's credit history before 
extending credit.


NOTE C--SIGNIFICANT TRANSACTIONS

	South Korean Joint Venture Agreement

	MVS Modular Vision Systems, Inc. ("MVS") and Kyung Pil Woo, a South
 Korean distributor of high technology products, entered into a joint
 venture agreement, whereby MVS and Mr. Woo have established a South Korean
 company ("TRIVISION") to service, assemble and perform the final
 manufacture of MVS and other high technology products.  The Joint Venture 
 will also promote, market, sell and distribute these products in South
 Korea and other Asian markets.  The Joint Venture will be owned equally
 (50%/50%) by MVS and Mr. Woo in exchange for each party's initial capital
 contribution of $200,000 in cash to the Joint Venture's working capital.
 MVS remitted its capital contribution in July 1997, upon completion of the
 joint venture agreement. The Company believes that the Joint Venture is
 essential to establishing a larger market presence for MVS products in
 South Korea and other Asian nations.

 	Lease Commitment

On April 30, 1997, the Company entered into an agreement to lease
approximately 35,000 square feet of space in Largo, Maryland to be used for
the assembly of computer components: the manufacturing of computer systems;
and the integration of computer systems for network applications.  In
addition, the facility will provide warehouse and office space, a customer 
showroom and training facilities.  The 5-year lease term, which includes
annual rent escalation clauses, provides for annual base rent of
approximately $140,000, plus the Company's share of property, taxes, and
maintenance costs.


<PAGE>

MVSI, Inc. and Subsidiaries

Notes to Interim Consolidated Financial Statements--Continued

June 30, 1997


NOTE D--STOCK PLANS

During the quarter ended June 30, 1997, the Company adopted the MVSI 1997
Stock Option Plan and the MVSI 1997 Employee Stock Purchase Plan, both of
which were ratified at the Company's Annual Meeting of Stockholders in
April 1997.  As of June 30, 1997, the Company had granted 480,000 options
under the MVSI 1997 Stock Option Plan, with exercise prices of approximately
$3.00.



NOTE E--ACQUISITION

The Company acquired Expert, effective April 1, 1997.  MVSI exchanged
300,000 of its restricted common stock for all the shares of common stock
held by Expert's stockholder.  The acquisition of Expert is accounted for as
a purchase.  The cost in excess of the fair value of net assets acquired
(goodwill) of approximately $805,000 will be amortized using an estimated
useful life of ten years.  The results of operations of Expert are included
in the accompanying financial statements since the date of acquisition.



NOTE F--LETTER OF INTENT

On August 6, 1997, MVSI entered into a Letter of Intent to acquire Technet
Computer Services, Inc. ("Technet").  Technet, a Virginia corporation, is a
computer software development company specializing in software solutions for
corporate clients to include implementing solutions for the Year 2000
computer problem.  The Letter of Intent provides MVSI an exclusive right
for 60 days to negotiate with Technet and reach a definitive agreement. 


<PAGE>

PART I.  FINANCIAL INFORMATION

Item 2.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations.
	
	The Company reported sales of $11,680,087 for the three month period ended
 June 30, 1997, as compared to $3,250,354 for the same period in fiscal year
 1996.  For the nine months ended June 30, 1997, the Company reported sales
 of $29,849,901 as compared to $9,858,955 for the same period in fiscal
 year 1996.  The increase in sales of $19,990,946 or 202% is attributable to
 the acquisition of Socrates, Inc. ("Socrates"), effective July 1, 1996,
 the acquisition of Expert, Inc. ("Expert"), effective April 1, 1997, and
 an increase in sales of the Company's computer products and services and
 laser machine vision products and systems.

	The gross margin of the Company decreased to 17% and 20% for the three
 months and nine months ended June 30, 1997, respectively.  The decrease in
 margins is principally a result of relatively lower gross profit margins in
 the Company's computer distribution and reselling businesses.

	For the three months ended June 30, 1997, selling expenses increased by
 $391,203 (331%) to $509,211 and increased by $1,168,539 (330%) to
 $1,521,804 for the nine months ended June 30, 1997. The increase in selling
 expenses, over those of the prior year, are primarily a result of increased
 sales and marketing efforts and the Company's acquisition of Socrates and
 Expert.  During 1997, the Company has aggressively expanded its marketing
 and sales presence in each market that the Company's products compete in.
 Administrative expenses increased $386,715 (91%) to $808,066 for the three
 months ended June 30, 1997 and increased by $788,542 (50%) for the nine
 months ended June 30, 1997, as a result of an increase in the Company's
 overall level of operations and the acquisitions of Socrates and Expert.

	Research and development expenditures, shown net of Canadian tax credits,
 increased by $116,326 to $155,671 for the three months ended June 30, 1997
 and increased by $127,066 to $317,824 for the nine months ended June 30,
 1997, as a result of the Company's continuing research and development
 efforts. Additionally, subsequent to the Company achieving technological
 feasibility on several software development efforts late in fiscal year
 1995, the Company continues to capitalize, in accordance with Statement of
 Financial Accounting Standards No. 86,  certain labor costs directly
 associated with these research and development efforts.  Management began
 amortizing certain capitalized software costs during the quarter ended
 June 30, 1997, upon release of the associated products.  Depreciation
 and amortization expense for the three months ended June 30, 1997 increased
 by $125,952 to $153,235 and increased by $242,875 to $316,169 for the nine
 months ended June 30, 1997, as a direct result of an increase in depreciable
 assets from the Company's acquisitions of Socrates and Expert, the resulting
 goodwill amortization recorded subsequent to the acquisitions, and the
 amortization of certain capitalized software costs which began during the
 quarter ended June 30, 1997.

	Interest income and expense and financing charges decreased by $53,365
 from $86,161 for the three month period ended June 30, 1997, and decreased
 by $90,569 for the nine months ended June 30, 1997. The decrease is
 primarily attributable to an increase in interest income from an outstanding
 note receivable, as well as an increase in other income, offset by an
 increase in margin loan interest expense.	The Company has net operating
 loss carryforwards and tax credit carryforwards to offset future taxable
 income and taxes payable. Although the Company has recognized income before
 income taxes through June 30, 1997, this has not resulted in the
 recognition of income tax expense due to the existence of available net
 operating loss carryforwards.  Future use of these net operating loss
 carryforwards was not affected by the Company's acquisitions during fiscal
 years 1996 and 1997.  However, in the event a change in control occurs in
 the future, use of all or a portion of the U.S. carryforwards could be
 affected. Moreover, as a result of the Company's anticipation of increasing
 levels of profitability, the Company may be required to begin paying
 income taxes during fiscal year 1997.

	The current provision for income taxes in the accompanying Statements of
 Operations is based upon the estimated annualized effective tax rate and is
 largely determined by management's estimate as of the interim date of
 projected taxable income for the entire fiscal year.  The Company was able
 to offset the current income tax expense at June 30, 1997, by realizing
 available deferred tax benefits.	Net income for the three months ended
 June 30, 1997 was $816,435 or $0.07 per share ($0.08 per share excluding
 the dilutive effect of approximately 6 million outstanding warrants and
 options), as compared to net income of $582,676 or $0.05 per share for the
 three months ended June 30, 1996.  Net income for the nine months ended
 June 30, 1997 was $2,024,666 or $0.17 per share ($0.19 per share excluding
 the dilutive effect of approximately 6 million outstanding warrants and
 options), as compared to net income of $1,384,826 or $0.12 per share
 (fully diluted) for the first nine months a year ago.	As of June 30, 1997,
 the Company had working capital of $9,561,893 compared to $9,562,778 as of
 September 30, 1996.  The fiscal year 1996 acquisitions of JMR Distributors
 and Socrates, the fiscal year 1997 acquisition of Expert, and future
 expansion of the Company's laser vision business, including continual
 software development, may require increased working capital to finance
 increases in inventory and accounts receivable comparable to or greater
 than the increase experienced in the nine months ended June 30, 1997 (see
 Consolidated Statements of Cash Flows).  While no assurances can be given,
 the Company believes that cash generated from operations, along with
 existing resources and available credit are sufficient to meet the
 Company's short-term working capital and other financing requirements.
 The Company, however, believes that it will be necessary to obtain
 additional funding or financing to satisfy the long-term capital needs of
 the Company's subsidiary operations and to provide for adequate working
 capital reserves.  The Company has no significant long-term debt
 outstanding as of June 30, 1997.

	The Company  has a bank line of credit with a bank for support of its
 Canadian operations temporary cash flow requirements, with interest
 payable monthly at the bank's prime rate plus .75% (prime was 4.75% on
 June 30, 1997).  At June 30, 1997, borrowings outstanding on the line
 of credit amounted to $471,014.  The line of credit is collateralized by
 all present and future accounts receivable, Canadian tax credits
 receivable and inventory of the Company's Canadian subsidiary.

	The Company also maintains a credit agreement with a local finance company
 for inventory financing for one of its subsidiaries.  The agreement
 provides the Company with the ability to pay certain inventory balances
 (purchases) in scheduled interest-free installments.  Borrowings outstanding
 under the agreement, at June 30, 1997, amounted to $350,807.  The agreement
 is subject to annual renewal and is collateralized by all present and
 future accounts receivable and inventory of the Company's subsidiary. 	

	Through September 30, 1995, the Company had borrowed $667,000 from Edward
 Ratkovich, chairman of the board of directors, president, chief executive
 officer and a principal shareholder of the Company, to enable the Company
 to meet its on-going cash flow requirements. These loans bear interest at 
 9% and are due on demand.  During fiscal year 1996, the Company repaid
 $524,000 on the loans to the stockholder from operating cash flow to
 partially repay these loans.  Total loans and accrued interest outstanding
 at June 30, 1997 total $234,938.

	Additionally, a subsidiary of the Company has working capital advances of
 $560,814 outstanding at June 30, 1997.  These working capital advances,
 which bear interest at 9% and are due on demand, were made to the
 subsidiary by its former stockholder prior to the Company's acquisition
 of the subsidiary.

	In October 1996,  the Company filed a Post-Effective Amendment to the
 Company's Form S-3 Registration Statement.  The Post-Effective Amendment
 related to the continuing resale and conversion of the Company's Class A
 Warrants previously issued in connection with the Company's August, 1995
 initial public offering.  The Class A Warrants became exercisable on the
 effective date of the Post-Effective Amendment filing.  Should all
 5,140,000 Class A Warrants and 1,000,000 Class B Warrants, plus the 
 underwriters' purchase option for 360,000 shares and 360,000 Class A
 Warrants, be exercised, the Company will receive the proceeds therefrom,
 aggregating up to $29,215,000.  As of June 30, 1997, 15,000 Class A
 Warrants had been exercised.  The Company can make no assurances that
 any of the remaining warrants or underwriters' purchase option shares
 will be exercised.

	In February 1997, the Company converted a $1.25 million note with e-Net,
 Inc. to 250,000 shares of e-Net, Inc. common stock.  The 250,000 shares
 of e-Net common stock owned by MVSI (classified as marketable securities
 in the accompanying balance sheet) were registered as part of e-Net's
 initial public offering (IPO) and are restricted from sale for a 12-month
 period from the date of e-Net's IPO (April 1997) but may be released for
 sale during the 12-month period with the consent of the Underwriter.

	During the quarter ended June 30, 1997, the Company repurchased 70,000
 shares of outstanding MVSI common stock (reflected as Treasury Stock in
 the accompanying balance sheet) in open market and block transactions.
 The Company intends to continue to buy back additional MVSI securities
 in open market or block transactions in compliance with U.S. Securities
 and Exchange Commission regulations.

	On April 30, 1997, the Company entered into an agreement to lease
 approximately 35,000 square feet of space in Largo, Maryland to be used
 for the assembly of computer components: the manufacturing of computer
 systems; and the integration of computer systems for network applications.
 In addition, the facility will provide warehouse and office space, a
 customer showroom and training facilities.  The 5-year lease term, which
 includes annual rent escalation clauses, provides for annual base rent of
 approximately $140,000, plus the Company's share of property, taxes and
 maintenance costs.

	The Company and its representatives may from time to
 time make written or oral forward-looking statements, including statements
 contained in the Company's filings with the U.S. Securities and Exchange
 Commission and in its reports to stockholders.  In connection with the
 "safe harbor" provisions of the Private Securities Litigation Reform Act
 of 1995, the Company is hereby identifying important factors that could
 cause actual results to differ materially from those contained in any
 forward-looking statement made by or on behalf of the Company.  Any such
 statement is qualified by reference to the following cautionary statements.
	The Company's operating results could be affected by a number of factors.
 They include the availability and cost of components, an unexpected
 inability to manage expenses relative to sales growth, and an inability to
 anticipate downward price pressures by customers using our products and
 services. Also, there is the potential problem of competing with companies
 having significantly greater financial, technical and market resources
 than the Company.	A significant percentage of the Company's sales to major
 customers historically has occurred in the last month of a quarter.
 Changes in purchasing patterns by one or more of the Company's major
 customers, and the inability of the Company to anticipate in advance the
 mix of customer orders and its ability to ship the necessary quantities of
 product near the end of a fiscal quarter, could result in material
 fluctuations in quarterly operating results.		The Company participates in
 competitive industries marked by changing technology, which could result in
 volatility of the Company's common stock price.  Additionally, any
 shortfall in revenue or earnings from the levels expected by securities
 analysts could have an immediate and significant effect on the trading
 price of the Company's common stock in any given period.  Moreover, it is
 possible the Company may not learn of such shortfalls until late in the
 fiscal quarter, which could result in an even more immediate and adverse
 effect on the trading price of the Company's stock.


<PAGE>

PART II.  OTHER INFORMATION


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

    a.  	Exhibits. 

      	 	Exhibit 11, Computation of Earnings Per Share
		       Exhibit 27, Article 5 - Financial Data Schedule

	
   	b.  	Reports on Form 8-K. 

       		Form 8-K, dated June 16, 1997. 




<PAGE>

                               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.

                             									       MVSI, INC.

August 14, 1997

                                						By: 	  EDWARD RATKOVICH  
									                                 ---------------------
                                             Edward Ratkovich
                             						    	  Chairman of the Board





<PAGE>


                       MVSI, Inc. and Subsidiaries          Exhibit 11
 
                    COMPUTATION OF EARNINGS PER SHARE

                                                    Primary   Fully Diluted
                                                    Earnings     Earnings
Nine Months ended June 30, 1997                     Per Share    Per Share
----------------------------------                 ---------- --------------

Weighted Average Shares Outstanding
  for the period                                   10,698,690   10,698,690 

Common stock equivalents arising from assumed
  exercise of warrants and options                  4,102,571    4,102,571 
                                                  ------------ ------------
                                                   14,801,261   14,801,261 
                                                  ============ ============

Net earnings for the period, as presented          $2,024,666   $2,024,666 

Add: Interest revenue from the assumed
  purchase of government securities (A),
  net of tax                                          443,326      443,326 
                                                  ------------ ------------ 
Adjusted net earnings                              $2,467,992   $2,467,992 
                                                  ============ ============ 

Earnings per share                                      $0.17        $0.17 
                                                  ============ ============


Three Months ended June 30, 1997
---------------------------------

Weighted Average Shares Outstanding
  for the period                                   10,638,082   10,638,082 

Common stock equivalents arising from assumed
   exercise of warrants and options                 4,367,494    4,367,494 
                                                  ------------ ------------
                                                   15,005,576   15,005,576 
                                                  ============ ============

Net earnings for the period, as presented            $816,435     $816,435 

Add: Interest revenue from the assumed
   purchase of government securities (A),
   net of tax                                         167,881      165,143 
                                                  ------------ ------------  
Adjusted net earnings                                $984,316     $981,578 
                                                  ============ ============

Earnings per share                                      $0.07        $0.07 
                                                  ============ ============ 

(A) Results from the 20% limitation on the
    number of shares repurchased upon exercise
    of warrants under the treasury stock method



<PAGE>

                      ARTICLE 5 FINANCIAL DATA SCHEDULE