AMENDED

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D. C. 20549

                                   FORM 10-QSB

                   QUARTERLY REPORT UNDER SECTION 13 OR 15 (D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Quarter Ended                              Commission File Number
      December 31, 1997                                          001-11747

                        THE ASHTON TECHNOLOGY GROUP, INC.
        (Exact name of small business issuer as specified in its charter)

      Delaware                                          22-6650372
(State of Incorporation)                 (I.R.S. Employer Identification Number)

              1900 Market Street, Suite 701, Philadelphia, PA 19103
                    (Address of principal executive offices)

          Issuer's telephone number, including area code: 215-751-1900

                 (Former name, former address and former fiscal
                       year if changed since last report)

Number of shares of common stock outstanding on December 31, 1997:     7,562,500

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 (of 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 ___


                                      -1-
<PAGE>


                        THE ASHTON TECHNOLOGY GROUP, INC.

                               INDEX - FORM 10-QSB

                                December 31, 1997

<TABLE>
<CAPTION>
Part I - Financial Information                                                           Page
------------------------------                                                           ----
<S>                                                                                        <C>
Item 1.  Financial Statements

         Consolidated Balance Sheets as of December 31, 1997 and March 31, 1997.........   4

         Consolidated Statements of Operations -
         For the Three and Nine Months Ended December 31, 1997 and 1996.................   5

         Consolidated Statements of Cash Flows -
         For the Nine Months Ended December 31, 1997 and 1996...........................   6

         Notes to Unaudited Consolidated Financial Statements...........................   7

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

Part II - Other Information
---------------------------

Item 1.  Legal Proceedings .............................................................  12

Item 2.  Changes in Securities and Use of Proceeds .....................................  12

Items 3 through 5 have  been omitted since the items are either inapplicable or the answer is negative

Item 6.  Exhibits and Reports on Form 8-K...............................................   12

Signatures .............................................................................   16
</TABLE>


                                      -2-
<PAGE>


                         PART I - FINANCIAL INFORMATION

ITEM 1.                      FINANCIAL STATEMENTS



                                      -3-
<PAGE>


                             The Ashton Technology Group, Inc. and Subsidiaries

                                        Consolidated Balance Sheets

                                 As of December 31, 1997 and March 31, 1997

                                                    December 31,     March 31,
                                                       1997            1997
                                                   ------------    -------------
                                                   (UNAUDITED)       (AUDITED)
                                     ASSETS
Current Assets:
   Cash and cash equivalents                       $    853,383    $     60,841
   Contracts receivable, net of allowance for
     doubtful accounts                                   36,843       1,483,163
   Notes receivable                                     100,009              --
   Prepayments and other current assets                 424,025          98,903
                                                   ------------    ------------
      Total Current Assets                            1,414,260       1,642,907
Property and equipment, net                             711,305       1,041,449
Note receivable - long term                             486,090              --
Private placement costs                                 700,818              --
Development costs                                       365,640              --
Investment in ECOM, Inc.                                105,000              --
Goodwill, net                                                --         575,581
Other assets                                             67,605         106,693
                                                   ------------    ------------
         Total Assets                              $  3,850,718    $  3,366,630
                                                   ============    ============

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
   Accounts payable and accrued expenses           $    994,663    $  1,937,752
   Billings in excess of costs                               --          52,722
                                                   ------------    ------------
      Total current liabilities                         994,663       1,990,474
Long-term debt                                           38,000          13,000
                                                   ------------    ------------
      Total liabilities                               1,032,663       2,003,474
                                                   ------------    ------------
Minority Interest                                            --         300,279
                                                   ------------    ------------
Commitments and contingencies
Stockholders' Equity:
   Preferred stock - $.01 par value                       5,485              --
   Common stock - $.01 par value                         75,625          75,625
Additional paid-in capital                           16,670,129      10,482,197
Accumulated deficit                                 (13,933,184)     (9,494,945)
                                                   ------------    ------------
Total stockholders' equity                            2,818,055       1,062,877
                                                   ------------    ------------
      Total Liabilities and
      Stockholders' Equity                         $  3,850,718    $  3,366,630
                                                   ============    ============

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


                                      -4-
<PAGE>


               The Ashton Technology Group, Inc. and Subsidiaries

                      Consolidated Statements of Operations

         For the Three and Nine Months Ended December 31, 1997 and 1996
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                        Three Months Ended                  Nine Months Ended 
                                                                           December 31,                        December 31,
                                                                   -----------------------------      ----------------------------- 
                                                                       1997             1996             1997              1996
                                                                   -----------       -----------      -----------       ----------- 
<S>                                                                <C>               <C>              <C>               <C>        
Revenues                                                           $   505,310       $ 1,144,977      $ 3,340,367       $ 3,426,992
                                                                   -----------       -----------      -----------       ----------- 
Costs and expenses:
  Cost of revenues                                                     431,233           827,121        2,620,896         2,355,816
  Development costs                                                    103,018           668,518          306,693         2,643,462
  Selling, general and administrative expenses                         892,930           695,432        2,813,757         2,331,783
  Depreciation and amortization                                        120,880           120,384          364,834           361,152
                                                                   -----------       -----------      -----------       ----------- 
Total costs and expenses                                             1,548,061         2,311,455        6,106,180         7,692,213
                                                                   -----------       -----------      -----------       ----------- 
Loss from operations                                                (1,042,751)       (1,166,478)      (2,765,813)       (4,265,221)

Other costs and revenues:
  Cost of corporate restructuring                                           --          (702,678)              --          (702,678)
  Interest income (expense), net                                       (55,043)           15,105         (142,070)          113,865
  Loss on sale of subsidiary                                          (385,930)               --         (385,930)               --
  Private placement costs                                              (55,003)               --         (165,005)               --
  Minority interest in earnings of subsidiary                           10,223           (37,085)         (11,464)         (118,153)
                                                                   -----------       -----------      -----------       ----------- 
Loss before provision for income taxes                              (1,528,504)       (1,891,136)      (3,470,282)       (4,972,187)
Provision for income taxes                                              27,749           155,800           41,775           227,300
                                                                   -----------       -----------      -----------       ----------- 
Net loss                                                           ($1,556,253)      $(2,046,936)     $(3,512,057)      $(5,199,487)
                                                                   ===========       ===========      ===========       =========== 
Net loss per common share                                          $      (.33)*     $      (.27)     $      (.59)*     $      (.73)
                                                                   ===========       ===========      ===========       =========== 
Weighted average number of common shares outstanding                 7,562,500         7,562,500        7,562,500         7,150,416
                                                                   ===========       ===========      ===========       =========== 
</TABLE>

* See Description of Business and Basis of  Presentation  paragraphs 5, 6 and 7.
Also See Exhibit 11, Computation of Earnings per Share

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


                                      -5-

<PAGE>


                             The Ashton Technology Group, Inc. and Subsidiaries

                                   Consolidated Statements of Cash Flows

                            For the Nine Months Ended December 31, 1997 and 1996
                                                (Unaudited)

<TABLE>
<CAPTION>
                                                                                         Nine Months Ended 
                                                                                             December 31, 
                                                                                ------------------------------------
                                                                                    1997                    1996
                                                                                ------------            ------------
<S>                                                                             <C>                     <C>          
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss                                                                        ($ 3,512,057)           ($ 5,199,487)
Adjustments to reconcile net loss to net cash used
  by operating activities, net of acquired business in 1996:
    Depreciation and amortization                                                    554,081                 253,827
      Increase in minority interest of subsidiary                                     11,464                      --
      Loss on sale of subsidiary                                                     385,930                      --
Changes in operating asset and liabilities
  Increase in contracts receivable, net                                              (36,843)               (229,469)
  Increase in prepayments and other assets                                          (273,568)               (236,094)
  Decrease in accounts payable and accrued expenses                                 (464,036)               (250,440)
  Increase in billings in excess of costs                                                 --                 194,043
                                                                                ------------            ------------
    Net cash used by operating activities                                         (3,335,029)             (5,467,620)
                                                                                ------------            ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Note receivable - sale of subsidiary                                              (586,099)                     --
  Purchase of fixed assets                                                          (121,797)             (1,012,917)
  Cash received from sale of subsidiary                                              600,000                      --
  Cash paid for acquisition of CSI(R), net of cash acquired                               --                (512,012)
  Investment in ECOM, Inc.                                                          (105,000)                     --
  Increase in minority interest                                                           --                 118,153
  Development costs                                                                 (365,640)                     --
  Adjustment of net cash for subsidiary sold                                         (45,448)                     --
                                                                                ------------            ------------
    Net cash used in investing activities                                           (623,984)             (1,406,776)
                                                                                ------------            ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Issuance costs for private placement                                              (702,997)                 (1,960)
  Issuance costs for initial public offering                                              --                (282,001)
  Proceeds from initial public offering                                                   --              10,394,709
  Proceeds from notes payable                                                             --                 250,000
  Proceeds from private placement                                                  5,500,000                      --
  Payment of notes payable                                                                --              (2,101,341)
                                                                                ------------            ------------
    Net cash provided by financing activities                                      4,797,003               8,259,407
                                                                                ------------            ------------
NET INCREASE IN CASH AND CASH EQUIVALENTS                                            837,990               1,385,011
Cash and cash equivalents, beginning of period                                        15,393                  31,021
                                                                                ------------            ------------
Cash and cash equivalents, end of period                                        $    853,383            $  1,416,032
                                                                                ============            ============
</TABLE>

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


                                      -6-
<PAGE>


THE ASHTON TECHNOLOGY GROUP, INC. AND SUBSIDIARIES NOTES TO
UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1.   DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

     The accompanying  unaudited  consolidated financial statements for the nine
     months  ended  December  31,  1997  include  the  accounts  of  The  Ashton
     Technology Group, Inc.  ("Ashton") and its subsidiaries,  Universal Trading
     Technologies Corporation ("UTTC(TM)"),  and Gomez Advisors, Inc. ("Gomez").
     Ashton, together with UTTC(TM) and Gomez, is the "Company".

     The Company's  subsidiary,  Computer Science Innovations,  Inc. ("CSI(R)"),
     was sold on  November  6,  1997  (see  "Sale  of  Subsidiary"  below).  The
     financial  statements  for the nine months ended December 31, 1997 includes
     CSI(R) until it was sold. The financial statements for the year ended March
     31, 1997 include  CSI(R),  but did not include  Gomez,  which was formed by
     Ashton as a wholly-owned subsidiary on May 21, 1997.

     As  originally  filed in the  Company's  Form 10-QSB for the quarter  ended
     December  31, 1997,  the Company  reflected a gain on the sale of CSI(R) of
     $102,000.  The reason for reporting the gain on sale in this manner results
     from the  Company's  accounting  for its  portion of  CSI(R)'s  prior years
     earnings as an adjustment to additional  paid-in  capital  instead of as an
     increase in its  investment in CSI(R).  Had the Company  accounted for this
     increase in investment, the sale of CSI(R) would have resulted in a loss of
     approximately  $386,000  instead of a gain of $102,000.  The  adjustment of
     $488,000  had  the  effect  of  increasing  the  Company's  net  loss  from
     $1,068,331 to $1,556,253 for the three-month period ended December 31, 1997
     and increasing the Company's net loss from $3,024,135 to $3,512,057 for the
     nine-month period ended December 31, 1997.

     A  corresponding  error was also made.  As  mentioned  above,  the loss was
     charged to additional  paid-in  capital when it should have been charged to
     operations. The revised reporting of this transaction had no effect on cash
     or working capital and did not produce a change in stockholders' equity.

     In addition,  the Company is amending its  financial  statements to reflect
     the  accounting  of the  "beneficial  conversion  feature"  of its Series A
     Convertible PIK Preferred Stock ("Series A Preferred Stock"). In accordance
     with  Topic D-60  described  below.  Financial  Accounting  Standard  Board
     Emerging  Issues Task Force Topic No. D-60  ("Topic  D-60")  addresses  the
     position of the accounting staff of the Securities and Exchange  Commission
     regarding   conversion   features  of  convertible   preferred   stock  and
     convertible debt securities that are "in the money" upon issuance, i.e. the
     conversion  price is below the market  price for the common  stock.  At the
     time of issuance,  the conversion  rate for the Series A Preferred stock of
     $1.00 per share was below the market  price.  Thus,  the Series A Preferred
     stock  contains a  "beneficial  conversion  feature"  within the meaning of
     Topic D-60.

     According to Topic D-60, an issuer of an equity security  containing such a
     "beneficial conversion feature" must allocate to additional paid-in capital
     an amount equal to the  intrinsic  value of such  conversion  feature.  The
     discount  resulting  from the  allocation  of proceeds  to the  "beneficial
     conversion  feature" is analogous to a dividend and should be recognized as
     a return to the preferred stockholders over the minimum period in which the
     preferred shareholders can realize that return.

     The net  effect  of the  adjustment  made to  conform  to topic  D-60 is an
     increase to previously  reported additional paid-in capital and accumulated
     deficit as of December 31, 1997 of approximately $926,000. In addition, the
     effect on loss per common share as  previously  reported was an increase of
     $0.12 and $0.13 for the three months ended December 31, 1997, respectively.
     The adjustment had no effect on total stockholders' equity.


                                      -7-
<PAGE>


     The  accompanying  unaudited  consolidated  financial  statements have been
     prepared by the Company in accordance  with generally  accepted  accounting
     principles  for interim  financial  statements  and in accordance  with the
     instructions for Form 10-QSB.  Accordingly,  they do not contain all of the
     information  and  footnotes  required  by  generally  accepted   accounting
     principles for complete financial statements. In the opinion of management,
     the  accompanying  unaudited  consolidated  financial  statements have been
     prepared  on the same  basis as the  audited  statements  and  include  all
     adjustments,  consisting only of normal  recurring  adjustments,  which are
     necessary  for a fair  statement  of the  results  of the  interim  periods
     presented.  These financial  statements  should be read in conjunction with
     the footnotes  contained in the Company's  10-KSB for the fiscal year ended
     March 31, 1997.

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

2.   SALE OF SUBSIDIARY

     On November 6, 1997,  Ashton sold CSI(R), to George H. Milligan and Susanne
     L.  Cavadeas,  as Trustees  of the Trust  Created by The  Computer  Science
     Innovations,  Inc. Leveraged ESOP, for $1,723,000,  payable as follows: (1)
     repayment of $500,000 loan plus interest of $28,875,  (2) $600,000 in cash,
     and (3) a five  year  83%  Note of  $594,125.  The  Company  recognized  an
     accounting loss of $385,930; however, on a cash basis, the Company actually
     realized a gain on the sale of $101,992.  (See the third paragraph  above.)
     In  addition,  the  Company  received  cash in the amount of  approximately
     $340,000 due to a Tax Allocation Agreement.

3.   PREPAYMENTS AND OTHER CURRENT ASSETS

     Included in prepayments are $413,980 of legal costs incurred by the Company
     in  connection  with a  lawsuit  with  one  stockholder.  The  Company  has
     submitted a claim in the amount of $413,980 to its  insurance  carrier.  To
     the extent  such costs are not  recoverable  from the  Company's  insurance
     carrier, Fredric W. Rittereiser,  Chief Executive Officer of Ashton and The
     Dover Group, Inc., a stockholder of Ashton, have agreed to pay such costs.


                                      -8-
<PAGE>


FORWARD-LOOKING STATEMENTS

     Certain   statements  in  this  Form  10-QSB  constitute   "forward-looking
statements"  within the meaning of Section 27A of the Securities Act of 1933, as
amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the
Private  Securities   Litigation  Reform  Act  of  1995.  Such   forward-looking
statements  involve known and unknown risks,  uncertainties  and other important
factors that could cause the actual results,  performance or achievements of the
Company  to  differ   materially  from  any  future   results,   performance  or
achievements  expressed  or implied  by such  forward-looking  statements.  Such
risks,  uncertainties and other important factors include, among others: general
economic and business conditions; industry trends; competition;  material costs;
ability to develop markets;  changes in business strategy or development  plans;
availability,  terms  and  deployment  of  capital;  availability  of  qualified
personnel; changes in government regulation and other factors referenced in this
Form 10-QSB. Such  forward-looking  statements speak only as of the date of this
Form 10-QSB.  The Company  expressly  disclaims any obligation or undertaking to
disseminate any updates or revisions to any forward-looking  statement contained
herein to reflect any change in the Company's  expectations  with regard thereto
or any change in events, conditions or circumstances on which any such statement
is based.


                                      -9-
<PAGE>


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

         NINE MONTHS OF FISCAL 1998 COMPARED TO NINE MONTHS OF FISCAL 1997.

For  fiscal  1997,  all of the  Company's  revenues,  and the  related  "cost of
revenues", were generated by CSI(R) which was sold on November 6, 1997 (see Note
2 to the  Financial  Statements),  and for  fiscal  1998,  all but  $159,750  of
revenues  were  generated  by  CSI(R).  The  sale  of  CSI(R)  has  resulted  in
substantially lower revenues from continuing operations.  Until the SEC approves
the Philadelphia Stock Exchange's  ("PHLX") proposed Rule 237 (see "Rule Change"
below) and the UTS(TM) VWAP(TM) trading system ("VTS(TM)") becomes  operational,
the Company will not be able to generate significant revenues.

On a  consolidated  basis,  the Company had revenues of $3,340,367  for the nine
months ended  December 31, 1997 compared to revenues of $3,426,992  for the nine
months ended December 31, 1996.

During the nine months ended December 31, 1997, the Company  incurred a net loss
of $3,512,057  as compared to the nine months ended  December 31, 1996, in which
the Company incurred a net loss of $5,199,487.

Development Costs

During the nine months ended December 31, 1997, the Company incurred $672,333 of
development  costs of which $306,693 was expensed and $365,640 was  capitalized.
For the nine months ended  December 31, 1996, the Company  incurred  development
costs of $2,643,462 which was expensed.  The December 31, 1996 development costs
included $1,618,592 for the Ashton Technology Encryption Device ("ATED") and its
associated  cryptoserver.  The  December  31,  1997  development  costs were for
enhancements   to  the  VTS(TM)   trading   system  and  the  design  of  future
transactional products.

Rule Change

On April 8, 1997, the Company announced that UTTC(TM) had completed  development
of its VTS(TM).  Under generally  accepted  accounting  principles,  the Company
expenses  development  costs  until the system is ready for  commercial  use and
thereafter  capitalizes any additional  development costs.  Although the VTS(TM)
trading system has been operationally  ready since April of 1997, trading on the
system  cannot  begin  until the  Securities  and  Exchange  Commission  ("SEC")
approves  Rule 237 proposed by the PHLX.  An  amendment  to the  proposed  rule,
reflecting  enhancements  made to the system since the SEC first  published  the
proposed rule in the Federal Register on September 4, 1996, was submitted by the
PHLX to the SEC on October 28, 1997. The SEC approved re-publishing the proposed
rule and  amendments  in the  Federal  Register on December  22,  1997,  and the
proposed rule and amendments were published in the Federal  Register on December
31, 1997. The notification  period will be a minimum of 35 days and a maximum of
90 days  after  publication.  There  can be no  assurance  that Rule 237 will be
approved or that,  if the SEC  approves  Rule 237,  the Company  will be able to
generate positive net revenues.

Capital Equipment

During the nine months ended  December 31, 1997,  the Company spent $121,797 for
the  acquisition  of equipment,  as compared to  $1,012,917  for the nine months
ended December 31, 1996. The reason capital  equipment  expenditures  during the
nine months  ended  December  31, 1996 were  substantially  greater  than in the
period ended  December 31, 1997 was because the primary  computers  required for
the VTS(TM) trading system were purchased  during the nine months ended December
31, 1996. Given the rapid  advancements in computer  technology,  the Company is
continually upgrading its systems.


                                      -10-
<PAGE>


Selling, General and Administrative Expenses

During the nine months ended December 31, 1997, the Company incurred  $2,813,757
of  Selling,  General  and  Administrative  ("SG&A")  expenses,  as  compared to
$2,331,783  for the nine months ended December 31, 1996. On a per company basis,
SG&A costs were  $1,591,230  for Ashton,  $494,808  for  UTTC(TM),  $433,083 for
CSI(R) and  $294,636  for Gomez.  The  increase  in SG&A  expenses is due to the
formation and operation of the new  wholly-owned  subsidiary of Gomez (which was
formed in April 1997) and to higher legal costs incurred in connection  with the
Rosensaft lawsuit, regulatory and listing issues. See "Legal Proceedings."


                                      -11-
<PAGE>


Liquidity

At December 31, 1997, the Company had cash and cash equivalents of $853,383. For
a description of an improvement in the Company's  liquidity since that date, see
"Subsequent Events" below.

On September 18, 1997 the Company  commenced a private offer and exchange  offer
pursuant to which it offered to certain  investors  (i) up to 250,000  shares of
its Series A Convertible PIK Preferred  Stock (with a liquidation  preference of
$10.00 per share) (the "Series A  Preferred");  (ii) up to 250,000 shares of its
Series B Convertible  Preferred  Stock (with a liquidation  preference of $10.00
per share) ("Series B Preferred");  and (iii) to exchange (the "Exchange Offer")
up to  300,000  shares  of  its  Series  B  Preferred  for up to  $3,000,000  of
convertible and non-convertible notes (the "UTTC(TM) Notes") issued by UTTC(TM).
The Series A Preferred pays cumulative dividends semi-annually at an annual rate
of $0.50 per share and is payable  in  additional  shares of Series A  Preferred
until  February 15, 2000.  At any time after  February 15, 1998,  each holder of
shares of Series A Preferred will have the right to convert each share of Series
A Preferred into: (i) ten shares of the Common Stock, par value $0.01 per share,
of Ashton (the "Common Stock");  and (ii) one two-year warrant to purchase three
shares  of the  Common  Stock,  par value  $0.01 per  share,  of  UTTC(TM)  (the
"UTTC(TM) Common Stock"),  with an exercise price of $0.75 per share, subject to
adjustment. The Series B Preferred pays cumulative dividends semi-annually at an
annual rate of $0.90 per share.  At any time after June 30, 1998, each holder of
shares of Series B Preferred will have the right to convert each share of Series
B Preferred into: (i) six shares of Common Stock;  and (ii) one two-year warrant
to purchase two shares of UTTC(TM) Common Stock, with an exercise price of $0.75
per share, subject to adjustment.

As of December 31, 1997, the Company had received signed Subscription Agreements
for all of the shares of the Series A  Preferred  offered  (250,000  shares) and
5,000 of the shares of Series B Preferred offered. This Series A transaction was
closed on January 15, 1998.

As of December 31, 1997, the Company had received signed Subscription Agreements
for the tender of  $2,975,000  of UTTC(TM)  Notes for which the  Company  issued
297,500 shares of Series B Preferred Stock. This Exchange transaction was closed
on January 15, 1998.

The Company has  extended  its private  offer to  institutional  and  accredited
investors of Series B Preferred  until May 15, 1998.  Such  offering of Series B
Preferred will not be registered under  Securities Act of 1933, as amended,  and
may not be offered or sold in the United States absent  registration  thereunder
or an applicable exemption from the registration requirements thereunder.

If and when the SEC approves the PHLX's  proposed  Rule 237 (see "Rule  Change",
above),  the Company expects to be able to commence the operation of its VTS(TM)
system with the PHLX within a month thereafter.

In addition to the $1,000,000  which the Company raised on January 27, 1998 (see
"Subsequent Events" below), the Company expects to raise additional capital from
future private  placements and/or other sources by the end of March, 1998. There
can be no assurances, however, that the Company will be able to raise capital on
a timely basis or on terms acceptable to the Company, if at all.

There can be no assurance that the Company's actual cash  requirements  will not
exceed its anticipated cash requirements or that additional cash requirements or
additional  financing will not be required.  The Company may require  additional
funds  to  provide  working  capital  and to  sustain  its  operations  until it
generates positive cash flow from its operations.

Subsequent Events

On January 27, 1998,  the Company  completed  the sale of 100,000  shares of the
Series "C"  Convertible  Preferred  Stock to a group of foreign  investors  (the
"Investors"), with a liquidation preference of $10.00 per



                                      -12-
<PAGE>


share (the "Series C Preferred"),  for an aggregate purchase price of $1,000,000
("Series  C  Shares").  Holders  of the  Series C Shares  will have the right to
convert  each  Series C Share into one share of Common  Stock at the  conversion
price  which  shall be equal  to the  following:  (i) if the  Market  Price  (as
hereinafter  defined) on the Conversion  Date (as  hereinafter  defined) is less
than $1.8774,  the conversion  price is equal to the lesser of 75% of the Market
Price at the  Conversion  Date or  $1.2516;  or (ii) if the Market  Price at the
Conversion  Date is equal to or greater than $1.8774,  the  conversion  price is
equal to $1.2516  plus 50% of the  difference  between  the Market  Price at the
Conversion  Date and $1.8774.  The "Market  Price" shall mean the average of the
closing  bid  prices per share of the  Common  Stock  over the five  consecutive
trading days ending on the trading day immediately preceding the date the holder
elects to have the shares of Series C Preferred Stock converted (the "Conversion
Date").  In addition,  the Investors will receive  warrants  exercisable into an
aggregate of 100,000  shares of Common Stock at an exercise price of 105% of the
Market Price for a period of 5 years.  In connection  with the sale, the Company
has agreed to pay a  placement  fee to the  placement  agent of  $50,000  and to
transfer to it 5,000 Shares of the Series C  Convertible  Preferred  Stock and a
warrant to purchase  100,000 shares of Common Stock at an exercise price of 105%
of Market Price for a period of 5 years.

The  Company  has used a  substantial  portion of the  $1,000,000  to reduce its
accounts payable and accrued expenses.


                                      -13-
<PAGE>


                           PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

See  previous  reports in the  Company's  Form  10-KSB for the fiscal year ended
March 31, 1997 and Form 10-QSB for the  quarterly  period  ended  September  30,
1997.

On December 3, 1997, Judge Shira A. Scheindlin entered her decision and order in
Rosensaft  v. The Ashton  Group,  Inc.  et al, No. 97 CIV.  3138 (SAS) 1997 U.S.
Dist.  1998 WL 749384 (SDNY)  granting  plaintiff's  Motion for Partial  Summary
Judgment under plaintiff's  Tenth Claim for Relief against  defendants The Dover
Group, Inc. and Fredric W. Rittereiser. Neither Ashton nor UTTC(TM) were parties
to, or affected by, this decision.

Alliant  Techsystems,  Inc.  ("Alliant")  has  notified  Ashton  of its claim of
approximately  $280,000 as the balance allegedly due under its contract with the
Company for the production of certain ATED systems.  On October 22, 1997, Ashton
filed a  complaint  against  Alliant  in the  Court of Common  Pleas,  County of
Philadelphia,  Pennsylvania  for  damages  for failure of Alliant to perform its
obligations under its contract with Ashton. On December 15, 1997,  Alliant filed
its  answer  and  counterclaims  seeking  damages  in an  amount  "in  excess of
$50,000."

In a letter to the Company  dated  November 17, 1997,  The NASDAQ Stock  Market,
Inc.  ("Nasdaq")  informed  the Company that the Nasdaq  Listing  Qualifications
Panel (the  "Panel")  granted the Company a  conditional  exception  to Nasdaq's
minimum capital and surplus listing  requirement.  The Panel required,  however,
that the Company  make a public  filing on or before  December 31, 1997 with the
SEC and  Nasdaq  containing  a balance  sheet  and  corresponding  statement  of
operations  no older than November 30, 1997 with  pro forma adjustments  for any
significant  events or transactions  occurring on or before the filing date, and
evidencing a minimum of $4,000,000  in capital and surplus.  On January 9, 1998,
in response to the December 30, 1997 request of the Company,  the Panel extended
the  conditional  exception  to January 16, 1998,  and on January 22, 1998,  the
Panel further  extended the conditional  exception to January 27, 1998, on which
date the  Company  filed a Form 8-K with the SEC and Nasdaq  which  contained  a
November 30, 1997 balance sheet with pro forma adjustments evidencing compliance
with the  $4,000,000  capital and surplus  requirement  set forth in the Panel's
decision dated January 9, 1998. By letter dated January 29, 1998, Nasdaq advised
the Company that the Company was found to be in compliance with the terms of its
qualifications  exception and with all  requirements  for  continued  listing on
Nasdaq, and that the hearing file was closed.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

See "Liquidity" and "Subsequent Events" in Item 2 of Part I above.

(Items 3 through 5 have been omitted since the items are either  inapplicable or
the answer is negative)

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (A)  Exhibits
              Exhibit 10.1 - Partial Summary  Judgment,  Rosensaft v. The Ashton
                             Group,  Inc.  et al.  (Incorporated by reference to
                             (i)  Report  on  Form  10Q-SB for  the period ended
                             December 31, 1996 and  (ii) Amendment No. 1 to Form
                             10-QSB  for  the  period  ended  December 31, 1996,
                             filed April 18, 1997)
              Exhibit 11   - Computation of Earnings Per Share.
              Exhibit 27   - Financial Data Schedule.
              Exhibit 99.1 - Stock Purchase  Agreement,  effective as of the 1st
                             day of  November,  1997,  by and among  The  Ashton
                             Technology  Group,  Inc.,  George K.  Milligan  and
                             Susan L. Cavadeas, as Trustees of the Trust created
                             by the



                                      -14-
<PAGE>


                             Computer Science Innovations,  Inc., Leveraged ESOP
                             and    Computer    Science    Innovations,     Inc.
                             (Incorporated  by  reference  to   Report  on  Form
                             10-QSB/A for period ended December 31, 1997,  filed
                             February 18, 1998)

         (B)  Reports on Form 8-K

              Form 8-K  dated  November  6, 1997 was  filed  pursuant  to Item 2
              (Disposition of Assets)

              Form 8-K  dated  November  12,  1997 was filed  pursuant to Item 5
              (Other Events)

              Form 8-K  dated  January  27,  1998 was filed  pursuant  to Item 5
              (Other Events)


                                      -15-
<PAGE>


                                  EXHIBIT INDEX

                                                                            Page
                                                                            ----
Ex-11  Computation of Earnings Per Share ..................................   16

Ex-27  Financial Data Schedule ............................................   17



                                      -16-
<PAGE>

                                   SIGNATURES

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


                                               The Ashton Technology Group, Inc.
                                               ---------------------------------
                                                        (Registrant)


Date: June 26, 1998                         By: /s/ Robert Eprile
                                               ---------------------------------
                                                    Robert Eprile
                                                    Chairman


                                      -18-