United States
                       Securities and Exchange Commission
                              Washington, DC 20549

                                   Form 10-QSB

--------------------------------------------------------------------------------


(Mark one)
   XX      QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
---------  ACT OF 1934


                For the quarterly period ended September 30, 1999

     TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT OF 1934

         For the transition period from ______________ to _____________

--------------------------------------------------------------------------------


                         Commission File Number: 0-27006

                           Million Dollar Saloon, Inc.
        (Exact name of small business issuer as specified in its charter)

           Nevada                                           13-3428657
  ------------------------                           ------------------------
  (State of incorporation)                           (IRS Employer ID Number)

                    6848 Greenville Avenue, Dallas, TX 75231
                    ----------------------------------------
                    (Address of principal executive offices)

                                 (214) 691-6757
                           ---------------------------
                           (Issuer's telephone number)


--------------------------------------------------------------------------------


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 the past 90 days. YES X NO

State the number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date: October 26, 1999:  5,731,778
                                                             ---------

Transitional Small Business Disclosure Format (check one):  YES  NO X



<PAGE>



                  Million Dollar Saloon, Inc. and Subsidiaries

              Form 10-QSB for the Quarter ended September 30, 1999

                                Table of Contents


                                                                            Page
                                                                            ----
Part I - Financial Information

  Item 1   Financial Statements                                               3

  Item 2   Management's Discussion and Analysis or Plan of Operation         12


Part II - Other Information

  Item 1   Legal Proceedings                                                 14

  Item 2   Changes in Securities                                             14

  Item 3   Defaults Upon Senior Securities                                   14

  Item 4   Submission of Matters to a Vote of Security Holders               14

  Item 5   Other Information                                                 14

  Item 6   Exhibits and Reports on Form 8-K                                  14


Signatures                                                                   15





                                                                               2

<PAGE>

<TABLE>
<CAPTION>


Part 1 - Item 1 - Financial Statements

                  Million Dollar Saloon, Inc. and Subsidiaries
                           Consolidated Balance Sheets
                           September 30, 1999 and 1998
                                   (Unaudited)

                                     Assets
                                     ------
                                                                         1999           1998
                                                                     -----------    -----------
<S>                                                                  <C>            <C>

Current Assets
   Cash on hand and in bank                                          $   705,012    $   730,242
   Note receivable - current portion                                      24,480         22,604
   Inventory                                                              14,387         14,438
   Prepaid expenses                                                       34,870         90,682
                                                                     -----------    -----------

      Total current assets                                               778,749        857,966
                                                                     -----------    -----------


Property and Equipment - At Cost
   Buildings and related improvements                                  1,987,514      1,987,513
   Furniture and equipment                                               822,149        791,049
   Vehicles                                                                 --           52,728
                                                                     -----------    -----------
                                                                       2,809,663      2,831,290
   Less accumulated depreciation                                      (1,596,986)    (1,542,662)
                                                                     -----------    -----------
                                                                       1,212,677      1,288,628
   Land                                                                  741,487        741,487
                                                                     -----------    -----------

      Net property and equipment                                       1,954,164      2,030,115
                                                                     -----------    -----------


Other Assets
   Note receivable - noncurrent portion                                   63,772         87,426
   Accounts receivable from officers,  shareholders and affiliates          --          836,107
   Organization costs, net of accumulated amortization
      of $60,884 and $45,898, respectively                                14,044         29,030
   Loan costs, net of accumulated amortization of
       $25,285 and $18,964 respectively                                    6,322         12,643
   Deferred tax asset                                                       --             --
   Other                                                                   6,975          7,725
                                                                     -----------    -----------

      Total other assets                                                  91,113        972,931
                                                                     -----------    -----------

Total Assets                                                         $ 2,824,026    $ 3,861,012
                                                                     ===========    ===========
</TABLE>


                                  - Continued -

The financial  information  presented  herein has been  prepared  by  management
  without audit by independent certified public accountants.
                                                                               3

<PAGE>

<TABLE>
<CAPTION>


                  Million Dollar Saloon, Inc. and Subsidiaries
                     Consolidated Balance Sheets - Continued
                           September 30, 1999 and 1998
                                   (Unaudited)

                      Liabilities and Shareholders' Equity
                      ------------------------------------

                                                               1999          1998
                                                           -----------   -----------
<S>                                                        <C>           <C>

Current Liabilities
   Current portion of long-term debt                       $   181,905   $   122,370
   Accounts payable - trade                                     23,568        26,311
   Accrued liabilities                                          59,194        55,614
   Dividends payable                                            57,318        61,445
   Federal income taxes payable                                  3,527         8,592
   Tenant deposits                                               6,500         6,500
                                                           -----------   -----------

      Total current liabilities                                332,012       280,832
                                                           -----------   -----------


Long-Term Liabilities
   Long-term debt, net of current maturities                     2,513       255,364
   Deferred tax liability                                      125,057        98,936
                                                           -----------   -----------

      Total Liabilities                                        459,582       635,132
                                                           -----------   -----------


Commitments and Contingencies


Shareholders' Equity
   Preferred stock - $0.001 par value.  5,000,000 shares
      authorized.  None issued and outstanding                    --            --
   Common stock - $0.001 par value.  50,000,000 shares
      authorized.  5,731,778 and 6,144,451 issued
      and outstanding, respectively                              5,732         6,143
   Additional paid-in capital                                     --         598,965
   Retained earnings                                         2,358,712     2,650,772
                                                           -----------   -----------
                                                             2,364,444     3,255,880
   Treasury stock - at cost                                       --         (30,000)
                                                           -----------   -----------

      Total Shareholders' Equity                             2,364,444     3,225,880
                                                           -----------   -----------

Total Liabilities and Shareholders' Equity                 $ 2,824,026   $ 3,861,012
                                                           ===========   ===========

</TABLE>


The financial  information  presented  herein has been  prepared  by  management
  without audit by independent certified public accountants.
                                                                               4

<PAGE>

<TABLE>
<CAPTION>


                  Million Dollar Saloon, Inc. and Subsidiaries
           Consolidated Statements of Income and Comprehensive Income
             Nine and Three months ended September 30, 1999 and 1998
                                   (Unaudited)

                                         Nine months    Nine months    Three months   Three months
                                             ended         ended          ended          ended
                                         September 30,  September 30,  September 30,  September 30,
                                             1999           1998           1999           1998
                                         -------------  -------------  -------------  -------------
<S>                                      <C>            <C>            <C>            <C>

Revenues
   Bar and restaurant sales              $ 2,448,838    $ 2,549,190    $   804,456    $   900,535
   Rental income                             514,961        378,579        174,525        139,524
                                         -----------    -----------    -----------    -----------
      Total revenues                       2,963,799      2,927,769        978,981      1,040,059
                                         -----------    -----------    -----------    -----------

Cost of Sales - Bar and
   Restaurant Operations                   1,479,889      1,504,252        463,252        517,504
                                         -----------    -----------    -----------    -----------

Gross Profit                               1,483,910      1,423,517        515,729        522,555
                                         -----------    -----------    -----------    -----------

Operating Expenses
   General and administrative expenses     1,063,030        972,561        390,124        299,908
   Interest expense                           19,645         36,904          3,346         11,295
   Depreciation and amortization              77,582         83,074         19,950         27,692
                                         -----------    -----------    -----------    -----------
      Total operating expenses             1,160,257      1,092,539        413,420        338,895
                                         -----------    -----------    -----------    -----------

Income from Operations                       323,653        330,978        102,309        183,660

Other Income (Expenses)
   Interest and other miscellaneous           14,973         45,086          4,738         15,923
   Gain on sale of fixed assets                 (691)          --             (691)          --
                                         -----------    -----------    -----------    -----------

Income before Income Taxes                   337,935        376,064        106,356        199,583

Income Tax (Expense)
   Currently payable                         (95,180)      (128,159)       (16,430)       (69,070)
   Deferred                                     --             --             --             --
                                         -----------    -----------    -----------    -----------

Net Income                                   242,755        247,905         89,926        130,513

Other comprehensive income                      --             --             --             --
                                         -----------    -----------    -----------    -----------

Comprehensive Income                     $   242,755    $   247,905    $    89,926    $   130,513
                                         ===========    ===========    ===========    ===========

</TABLE>



The financial  information  presented  herein has been  prepared  by  management
  without audit by independent certified public accountants.
                                                                               5

<PAGE>

<TABLE>
<CAPTION>


                  Million Dollar Saloon, Inc. and Subsidiaries
           Consolidated Statements of Income and Comprehensive Income
             Nine and Three months ended September 30, 1999 and 1998
                                   (Unaudited)

                                Nine months    Nine months    Three months   Three months
                                   ended          ended          ended          ended
                               September 30,   September 30,  September 30,  September 30,
                                    1999           1998           1999          1998
                               ------------    -------------  -------------  -------------
<S>                             <C>             <C>            <C>            <C>

Net Income                      $  242,755      $  247,905     $   89,926     $  130,513

Other comprehensive income            --              --             --             --
                                ----------      ----------     ----------     ----------

Comprehensive Income            $  242,755      $  247,905     $   89,926     $  130,513
                                ==========      ==========     ==========     ==========


Earnings per share of common
   stock outstanding computed
   on net income - basic and
   fully diluted                $     0.04      $     0.04     $     0.02     $     0.02
                                ==========      ==========     ==========     ==========

Weighted-average number
   of shares outstanding         5,731,778       5,937,143      5,731,778      6,144,451
                                ==========      ==========     ==========     ==========
</TABLE>




The financial  information  presented  herein has been  prepared  by  management
  without audit by independent certified public accountants.
                                                                               6

<PAGE>

<TABLE>
<CAPTION>


                  Million Dollar Saloon, Inc. and Subsidiaries
                      Consolidated Statements of Cash Flows
                  Nine months ended September 30, 1999 and 1998
                                   (Unaudited)

                                                                     Nine months   Nine months
                                                                         ended        ended
                                                                     September 30, September 30,
                                                                        1999         1998
                                                                     ------------- -------------
<S>                                                                   <C>          <C>

Cash Flows from Operating Activities
   Net income                                                         $ 242,755    $ 247,905
   Adjustments to reconcile net income to net cash
      provided by operating activities
         Depreciation and amortization                                   77,582       83,074
         Loss on sale of fixed assets                                       691         --
         Common stock issued for consulting fees                           --         69,700
         Interest income from shareholders capitalized as principal        --        (30,423)
         (Increase) decrease in
            Accounts receivable - trade                                   6,671         --
            Federal income taxes receivable                              91,653       37,248
            Inventory                                                     4,017        1,659
            Prepaid expenses                                             21,590      (17,138)
         Increase (decrease) in
            Accounts payable and other accrued liabilities               (3,432)      23,730
            Tenant deposits                                                --           --
            Income taxes payable                                          3,527        8,592
                                                                      ---------    ---------
Net cash provided by operating activities                               445,054      424,347
                                                                      ---------    ---------

Cash Flows from Investing Activities
   Principal collections on note receivable                              15,995       18,016
   Net proceeds from sale of fixed assets                                  --           --
   Purchases of property and equipment                                  (26,615)     (66,319)
                                                                      ---------    ---------
Net cash used in investing activities                                   (10,620)     (48,303)
                                                                      ---------    ---------

Cash Flows from Financing Activities
   Private placement of common stock                                       --        530,000
   Principal payments on notes payable                                 (131,544)    (120,426)
   Purchase of treasury stock                                              --        (30,000)
   Dividends paid                                                      (172,695)    (175,328)
                                                                      ---------    ---------
Net cash used in financing activities                                  (304,239)     204,246
                                                                      ---------    ---------

Increase in Cash and Cash Equivalents                                   130,195      580,290
Cash and cash equivalents at beginning of period                        574,817      149,952
                                                                      ---------    ---------
Cash and cash equivalents at end of period                            $ 705,012    $ 730,242
                                                                      =========    =========
</TABLE>


                                  - Continued -

The financial  information  presented  herein has been  prepared  by  management
  without audit by independent certified public accountants.

                                                                               7

<PAGE>



                  Million Dollar Saloon, Inc. and Subsidiaries
                Consolidated Statements of Cash Flows - Continued
                  Nine months ended September 30, 1999 and 1998
                                   (Unaudited)

                                          Nine months    Nine months
                                             ended        ended
                                         September 30,  September 30,
                                            1999           1998
                                         -------------  -------------
Supplemental Disclosures of Interest
   and Income Taxes Paid
      Interest paid during the period      $19,645        $36,904
                                           =======        =======
      Income taxes paid (refunded)         $  --          $82,319
                                           =======        =======


Supplemental Schedule of Non-Cash
   Investing and Financing Activities

   Declaration of third quarter
      dividend at $0.01 per share,
      respectively                         $57,318        $61,445
                                           =======        =======


The financial  information  presented  herein has been  prepared  by  management
  without audit by independent certified public accountants.
                                                                               8

<PAGE>



                                   Million Dollar Saloon, Inc. and Subsidiaries

                                           Notes to Financial Statements


Note 1 - Basis of Presentation

Million Dollar Saloon,  Inc.  (Company) was  incorporated  under the laws of the
State of Nevada on September 28, 1987.  These financial  statements  reflect the
books and  records of Million  Dollar  Saloon,  Inc.  (Nevada),  Million  Dollar
Saloon, Inc. (Texas),  Furrh, Inc., Tempo Tamers, Inc., Corporation Lex and Don,
Inc.  for the  periods  ended  September  30, 1999 and 1998,  respectively.  All
significant intercompany  transactions have been eliminated in combination.  The
consolidated entities are referred to as Company.

During interim periods, the Company follows the accounting policies set forth in
its Annual Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act
of 1934 on Form 10-KSB filed with the  Securities and Exchange  Commission.  The
accompanying  financial  statements do not include all  disclosures  required by
generally  accepted  accounting  principles.   Users  of  financial  information
provided for interim  periods should refer to the annual  financial  information
and footnotes  contained in its Annual Report Pursuant to Section 13 or 15(d) of
The  Securities  Exchange Act of 1934 on Form 10-KSB when  reviewing the interim
financial results presented herein.

In the opinion of management,  the accompanying  interim  financial  statements,
prepared in accordance with the instructions for Form 10-QSB,  are unaudited and
contain  all  material   adjustments,   consisting  only  of  normal   recurring
adjustments  necessary to present  fairly the  financial  condition,  results of
operations  and cash flows of the Company  for the  respective  interim  periods
presented.  The  current  period  results  of  operations  are  not  necessarily
indicative of results which ultimately will be reported for the full fiscal year
ending December 31, 1999.

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could differ from those estimates.


Note 2 - Summary of Significant Accounting Policies

a.)   Cash and cash equivalents
      -------------------------

      The Company considers all cash on hand and in banks, including accounts in
      book overdraft positions,  certificates of deposit and other highly-liquid
      investments with maturities of three months or less, when purchased, to be
      cash and cash equivalents.



                                                                               9

<PAGE>



                  Million Dollar Saloon, Inc. and Subsidiaries

                    Notes to Financial Statements - Continued


Note 3 - Common stock transactions

On March 19, 1998, the Company sold 530,000  shares of restricted,  unregistered
common stock to an individual under a Stock Purchase Agreement  (Agreement) at a
price of $1.00 per  share for total  proceeds  to the  Company  of$530,000.  The
Agreement also contains a "second  closing"  clause whereby the individual  will
acquire an  additional  400,000  shares of equivalent  restricted,  unregistered
common  stock at $1.10 per share for gross  proceeds of  $440,000,  on or before
July 15, 1998. On October 18, 1999,  the Company's  Board of Directors  modified
and amended the ":second closing" clause whereby the purchaser may purchase from
time to time any or all of the 400,000 shares of common stock at $1.10 per share
and to extend the  exercise  period  until the close of  business on October 18,
2004. As of September 30, 1999,  the  individual has not purchased any shares of
common stock in accordance with the "second closing" portion of the Agreement.

Further,  the  Company  has  granted  the  individual  the option to purchase an
additional 1,000,000 shares of restricted,  unregistered common stock at a price
of $1.25 per share on or before February 28, 1999. The option  expiration may be
accelerated  if the  Company's  common  stock is traded on the NASDAQ  Small-Cap
Market or other  national  exchange  and the closing bid price equals or exceeds
$1.75 per share for 10 consecutive trading days (Trading Period). In this event,
the expiration date of the option shall be the 90th day after the Trading Period
and the Company must notify the individual of the acceleration in writing.  This
option has expired with no shares being purchased thereunder.

On March 19, 1998, concurrent with the Stock Purchase Agreement discussed above,
the Company entered into a Consulting  Agreement with a separate  individual for
consulting,  advisory and management services to be performed as directed by the
Company's Board of Directors. The Consulting Agreement was for a term of one (1)
year and may be  terminated  by either party with ten (10) days written  notice.
The  compensation   for  the  Consulting   Agreement  was  paid  in  restricted,
unregistered  common stock of the Company as follows:  150,000 shares as payment
for consulting,  advisory and management services to be performed as directed by
the Company's Board of Directors and an additional 55,000 shares upon receipt of
the $530,000  discussed above. An additional 45,000 shares will be issued to the
consultant  upon receipt of the $440,000,  which was originally due on or before
July 15, 1998, as discussed above.

The Company,  upon  execution  of the  Consulting  Agreement  and receipt of the
$530,000 related to the Stock Purchase Agreement,  issued the respective 150,000
and  55,000  shares  due  under  the terms of the  Consulting  Agreement.  These
transactions  were  valued at  approximately  $0.34 per share,  or an  aggregate
$69,700,  which approximated the "fair value" of the Company's  restricted stock
issued on the transaction date.



               (Remainder of this page left blank intentionally.)

                                                                              10

<PAGE>



                  Million Dollar Saloon, Inc. and Subsidiaries

                    Notes to Financial Statements - Continued


Note 4 - Segment Information

The  Company  operates  with a  centralized  management  structure  and  has two
identifiable  operating segments:  an adult entertainment  lounge and restaurant
located in Dallas, Texas and commercial rental real estate located in Dallas and
Tarrant  Counties,  Texas.  All revenues are generated from  operations in these
geographic  areas.  The Company has a relationship  whereby rental revenues from
various entities under common control comprise  approximately  17.38% and 14.85%
of total  revenues for the nine month period ended  September 30, 1999 and 1998,
respectively.

<TABLE>

                                          Restaurant     Rental      General and
                                          facility      real estate  administrative    Total
                                        ------------   ------------  -------------- -----------
<S>                                     <C>            <C>           <C>            <C>

Nine months ended September 30, 1999
------------------------------------
   Revenue from external customers      $ 2,448,838    $   514,961   $      --      $ 2,963,799
   Revenue (expenses) from/to
     intercompany sources                      --             --            --             --
   Interest income                             --            5,358         9,615         14,973
   Interest expense                          (1,593)          --          21,238         19,645
   Depreciation and amortization             24,680         44,429         8,473         77,582
   Income tax expense (benefit)             (16,790)       112,972        (1,002)        95,180
   Segment assets                           419,023      1,939,850       465,153      2,824,026
   Fixed asset expenditures                  19,901          6,714          --           26,615

Nine months ended September 30, 1998
------------------------------------
   Revenue from external customers      $ 2,549,190    $   378,579   $      --      $ 2,927,769
   Revenue (expenses) from/to
     intercompany sources                      --             --            --             --
   Interest income                            7,658         30,116         7,312         45,086
   Interest expense                           2,471         34,433          --           36,904
   Depreciation and amortization             23,528         51,073         8,473         83,074
   Income tax expense (benefit)              31,746        121,102       (24,689)       128,159
   Segment assets                           713,636      2,668,294       479,082      3,861,012
   Fixed asset expenditures                  44,301         22,018          --           66,319

</TABLE>

Note 5 - Commitments

On July 9, 1999,  Dewanna Ross,  the Company's  Chief  Operating  Officer,  Vice
President of Operations,  Secretary,  Treasurer and a director,  entered into an
Employment Agreement  (Agreement) with the Company for a term of two years which
provides for a salary of $1,400 per week during the first year of the  Agreement
and $1,500 per week during the second year of the Agreement.



                                                                              11

<PAGE>



Part I - Item 2

Management's Discussion and Analysis of Financial Condition and
Results of Operations

(1)  Caution Regarding Forward-Looking Information

This  quarterly   report  contains   certain   forward-looking   statements  and
information relating to the Company that are based on the beliefs of the Company
or management as well as assumptions made by and information currently available
to  the  Company  or  management.   When  used  in  this  document,   the  words
"anticipate,"   "believe,"   "estimate,"   "expect"  and  "intend"  and  similar
expressions,  as they relate to the Company or its  management,  are intended to
identify forward-looking statements. Such statements reflect the current view of
the  Company   regarding  future  events  and  are  subject  to  certain  risks,
uncertainties  and  assumptions,  including the risks and  uncertainties  noted.
Should  one or more of  these  risks or  uncertainties  materialize,  or  should
underlying assumptions prove incorrect,  actual results may vary materially from
those  described  herein  as  anticipated,   believed,  estimated,  expected  or
intended. In each instance,  forward-looking information should be considered in
light of the accompanying meaningful cautionary statements herein.

(2)  Results of Operations

Bar and restaurant  operations  declined by  approximately  $100,000 between the
first  nine  months of 1999  compared  to the first  nine  months of 1998.  This
decline  occurred  in the third  quarter  of 1999 and is  attributed  to reduced
consumer traffic in the Company's  facility.  Total bar and restaurant sales for
the 1999 period were  approximately  $2.45 million as compared to  approximately
$2.55  million for the 1998 period.  Rental  income  increased by  approximately
$136,000  for the same period  from  approximately  $379,000  for the first nine
months of 1998 to approximately $515,000 for the first nine months of 1999. This
is  due to  scheduled  increases  in  weekly  rental  income  on  the  Company's
properties and the execution of a new lease renewal at higher rates in 1998.

The Company  continues to seek effective  marketing and  advertising  methods to
maintain and increase its bar and restaurant patronage.

Cost of sales decreased by approximately $24,000 during the first nine months of
1999 as compared to the same expenses for the same period in 1998.  This overall
decline is a result of changes in  variable  operating  costs for  personnel  as
offset by charges for  upgrading  and  renovations  to stage  lighting and sound
systems in the  Company's  Dallas  Texas  entertainment  facility.  Gross profit
percentages  increased  slightly  to 50.07%  for the first  nine  months of 1999
versus  48.48% for the first nine months of 1998.  Increased  cost controls over
purchasing,  inventory  management  protocols and labor  management  continue to
contribute to improving gross profit percentages.

General and administrative  expenses increased by approximately  $67,000 for the
nine months ended  September  30, 1999 versus the first nine months of 1998.  Of
this  change,  approximately  $74,000 in  increased  general and  administrative
expenses were  attributable to increased legal and professional  fees related to
general corporate business matters and the class action litigation, as discussed
in  Part  II  -  Item  1,  Legal  Proceedings,   and  increased   administrative
compensation  expenses on new employment  agreements  executed  during the third
quarter.  The Company continues to experience  relatively  constant  expenditure
levels for other general operating expenses. Management continues to monitor its
expenditure levels to achieve optimum financial results.


                                                                              12

<PAGE>



Net income  before  income taxes was  approximately  $338,000 for the first nine
months of 1999 versus approximately  $376,000 for the first nine months of 1998.
After-tax net income was relatively  constant at approximately  $243,000 for the
first nine months of 1999 and  approximately  $247,000 for the first nine months
of 1998. The Company  experienced  earnings per share of approximately $0.04 per
share for the first nine months of both 1999 and 1998.


(2)  Liquidity

As of  September  30,  1999,  the Company has working  capital of  approximately
$447,000  as  compared  to  approximately  $441,000  at  December  31,  1998 and
approximately $577,000 at September 30, 1998. The Company achieved positive cash
flows from  operations  of  approximately  $445,000 for the first nine months of
1999  versus  approximately  $424,000  for the first  nine  months of 1998.  The
Company's working capital position was impacted by the increased  calculation of
current  maturities  of  long-term  debt for 1999 and the  payment of income tax
estimates during 1998 which were carried forward into 1999.

The Company has identified no significant  capital  requirements for the current
annual period.  Liquidity requirements mandated by future business expansions or
acquisitions,  if any are specifically identified or undertaken, are not readily
determinable  at this  time as no  substantive  plans  have been  formulated  by
management.

The Company paid cash  dividends of an aggregate of  approximately  $173,000 and
$175,000  during  the  first  nine  months of 1999 and  1998,  respectively  and
declared dividends of approximately  $57,000 to be paid in the fourth quarter of
1999 and 1998,  respectively.  Future  operating  liquidity,  debt  service  and
dividend  payments,  if  any,  are  expected  to be  sustained  from  continuing
operations.


(3)  Year 2000 Considerations

The Year 2000 (Y2K) date change is believed to affect  virtually  all  computers
and  organizations.  The Company has  undertaken a  comprehensive  review of its
information  systems,  including  personal  computers,  software and  peripheral
devices,  and its  general  communications  systems.  The  Company has no direct
electronic  links with any  customer or supplier.  In addition,  the Company has
held discussions with certain of its software  suppliers with respect to the Y2K
date change.  The Company has  completed its detailed  review,  as a preliminary
assessment and the Company believes, as of the date of this filing, that it will
not be  required  to modify or  replace  significant  portions  of its  computer
hardware or software and any such modifications or replacements are, or will be,
readily  available.  The Company has completed its detailed review and completed
all  modifications,  upgrades or replacements  during the third quarter of 1999.
The total expenditure for this endeavor was less than $5,000 and not material to
the Company's financial statements or operations.

The Company  has held  discussions  with its  significant  suppliers,  shippers,
customers and other external  business  partners  related to their readiness for
the Y2K date change.  There can be no assurance until January 1, 2000,  however,
that all of the Company's systems,  and the systems of its suppliers,  shippers,
customers or other external business partners will function adequately.



                                                                              13

<PAGE>



Part II - Other Information

Item 1 - Legal Proceedings

   The Company is one of several  defendants in Cause No.  DV99-02585-L;  Roy D.
   Stedham v. The Million Dollar Saloon,  et al.; 193rd District  Court,  Dallas
   County,  Texas which is alleged to be a class action seeking monetary damages
   for violation of the Texas Finance Code concerning  overcharges for purchases
   of certain  items by the use of a credit  card.  The  Company  has denied the
   allegations  and  intends to  vigorously  contest  the claims  asserted.  The
   Company  does not  believe  that the  plaintiff/class  will  prevail on their
   claims.  The monetary  damages sought,  plus attorneys' fees, in management's
   opinion  does not  constitute  an amount  that is  material  to the  Company.

Item 2 - Changes in Securities

   None

Item 3 - Defaults on Senior Securities

   None

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

   The Company has held no regularly  scheduled,  called or special  meetings of
   shareholders during the reporting period.

Item 5 - Other Information

   None

Item 6 - Exhibits and Reports on Form 8-K

   Exhibit 27       Financial Data Schedule

   Form 8-K         None




                (Remainder of this page left blank intentionally)



                                                                              14

<PAGE>



                                   SIGNATURES

In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                                          Million Dollar Saloon, Inc.


October    27   , 1999                     /s/ Dewanna Ross
        --------                          -----------------------------------
                                                                 Dewanna Ross
                                           President, Chief Operating Officer
                                                                 and Director


October    27   , 1999                        /s/ Ronald W. Johnston
        --------                          -----------------------------------
                                                           Ronald W. Johnston
                                                      Chief Financial Officer





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