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 Quarter Ended:                            Commission File Number
   March 31, 1999                                       0 - 9574

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


                         UNITED SYSTEMS TECHNOLOGY, INC.

        Iowa                                            42-1102759
(State of Incorporation)                             (I.R.S. Employer
                                                  Identification Number)

                           1850 Crown Road, Suite 1109
                               Dallas, Texas 75234
                                 (972) 402-8600

          (Address of principal executive offices and telephone number)

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

     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the  Securities  Exchange Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

                         Yes __X__        No ______



     As of March 31,  1999  there  were  48,178,043  shares of the  registrant's
Common Stock, par value $0.10 per share, outstanding.


<PAGE>

                 UNITED SYSTEMS TECHNOLOGY, INC. AND SUBSIDIARY

                              INDEX TO FORM 10-QSB



PART I - FINANCIAL INFORMATION (UNAUDITED)                           PAGE
------------------------------------------                           ----  

Item 1.  Consolidated Financial Statements  

                  Balance Sheets                                       3

                  Statements of Operations                             4

                  Statements of Cash Flows                             5

                  Notes to Consolidated Financial Statements           6


Item 2.  Management's Discussion and Analysis or
         Plan of Operation                                             8


PART II - OTHER INFORMATION                                           11
---------------------------


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


     The consolidated financial information reflects all adjustments, which are,
in the opinion of  management,  necessary  to a fair  presentation  of financial
position  and of the  statements  of  operations  and cash flows for the periods
presented.


     These consolidated  financial statements should be read in conjunction with
the notes to the  consolidated  financial  statements  which are included in the
annual report on Form 10-KSB for the fiscal year ended December 31, 1998.

<PAGE>

                 United Systems Technology, Inc. and Subsidiary
                           Consolidated Balance Sheets
<TABLE>
<S>                                              <C>              <C>

                                                  March 31,
                                                    1999          December 31,
                                                (Unaudited)          1998
                                                ===========       ===========
  Current Assets
Cash and cash equivalents                       $   609,776       $   478,008
Trade accounts receivable, less allowance
 for doubtful accounts of $25,000 at March 31,
 1999 and December 31, 1998                         243,472           329,708
                                                 ----------        ----------  
    Total current assets                            853,248           807,716
                                                 ----------        ----------

Property and equipment, net                          67,006            65,329
Goodwill, net                                       396,669           413,653
Purchased software, net                              28,908            33,301
Deposits and other                                   10,489             5,139
                                                 ----------        ----------
                                                    503,072           517,422
                                                 ----------        ----------

    Total assets                                $ 1,356,320       $ 1,325,138
                                                 ==========        ==========

    Liabilities and Stockholders' Equity
  Current Liabilities
Current portion of capital lease obligations    $     1,857       $     2,448
Trade accounts payable, including $113,200
 payable to a related party at March 31, 1999
 and December 31, 1998                              212,885           182,366
Accrued payroll                                      48,728           110,806
Accrued interest - related party                     37,249            43,457
Other accrued expenses                               92,546            83,241
Deferred revenue                                    644,735           701,180
                                                 ----------        ----------
    Total current liabilities                     1,038,000         1,123,498

Notes payable - related party                        22,915            27,083
                                                 ----------        ----------
    
    Total liabilities                             1,060,915         1,150,581
                                                 ----------        ----------

Commitments and contingencies                          -                 -

    Stockholders' Equity
Preferred stock, convertible, voting, cumulative,
 par value $.10 per share; authorized 5,000,000
 shares; issued and outstanding, 500,000 shares
 of Series B, 500,000 shares of Series D, and
 300,000 shares of Series E, aggregate
 liquidating preference of 1,300,000
 ($1.00 per share)                                  130,000           130,000
Common stock, par value $.10 per share;
 authorized 100,000,000 shares; issued and
 outstanding 48,278,043 at March 31, 1999 and
 December 31, 1998                                4,817,804         4,817,804
Additional paid-in capital                        3,338,063         3,333,561
Accumulated deficit                              (7,950,462)       (8,066,808)
                                                 ----------        ----------
                                                    335,405           214,557
Less stock purchase note receivable                  40,000            40,000
                                                 ----------        ----------
    Total stockholders' equity                      295,405           174,557
                                                 ----------        ----------
    Total liabilities and stockholders' equity  $ 1,356,320       $ 1,325,138
                                                 ==========        ==========
</TABLE>


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

<PAGE>

                 United Systems Technology, Inc. and Subsidiary
                      Consolidated Statements of Operations
                                   (Unaudited)
<TABLE>
<S>                                                <C>               <C>

                                                    Three Months Ended
                                                         March 31,
                                                   1999              1998
                                                ===========       ===========
Revenue
 Software packages                              $   125,575       $    47,584
 Installation, training and customer support         89,162            19,342
 Maintenance                                        230,328           256,235
 Equipment and supplies sales                        68,133            42,575
 Other                                                4,274             1,843
                                                 ----------        ----------
                                                    517,472           367,579
                                                 ----------        ----------
Costs and expenses
 Salaries                                           226,936           207,597
 Other general, administrative and
  selling expense                                   117,762           115,355
 Depreciation and amortization                       28,566            36,771
 Commissions                                          4,410             4,001
 Cost of equipment and supplies sold                 38,292            18,810
                                                 ----------        ----------
                                                    415,966           382,534
                                                 ----------        ----------
Income (loss) from operations                       101,506           (14,955)
                                                 ----------        ----------

Nonoperating income (expense)
 Interest expense                                      (551)           (1,170)
 Interest income                                      5,521             1,778
                                                 ----------        ----------
                                                      4,970               608
                                                 ----------        ----------

Net income (loss) before extraordinary item         106,476           (14,347)
                                                 ----------        ----------

Extraordinary gain on settlement of debt              9,870              -
                                                 ----------        ----------

Net income (loss)                                   116,346           (14,347)

Preferred stock dividend requirements               (22,440)          (22,440)
                                                 ----------        ----------

Income (loss) available for common stockholders $    84,036       $   (36,787)
                                                 ==========        ==========

Net income (loss) per common share before
 extraordinary item                             $       NIL       $      NIL
Extraordinary gain on settlement of debt                NIL              NIL
Net income (loss) per common share after         ----------        ----------
 extraordinary item                             $       NIL       $      NIL
                                                 ==========        ==========

Weighted average number of common
 shares outstanding                              48,178,043        43,178,043
                                                 ==========        ==========

</TABLE>

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

<PAGE>

                 United Systems Technology, Inc. and Subsidiary
                      Consolidated Statements of Cash Flows
            For the Three Month Period Ended March 31, 1999 and 1998
                                   (Unaudited)
<TABLE>
<S>                                                <C>               <C>

                                                   1999              1998
                                                ===========       ===========
Cash flows in operating activities:
  Net income (loss)                             $   116,346       $   (14,347)

 Adjustments to reconcile net income (loss)
  to net cash provided by operating activities:
   Depreciation and amortization                     28,566            36,771
   Extraordinary gain on settlement of debt          (9,870)             -

 Change in operating assets and liabilities:
   Accounts receivable                               86,236           102,919
   Prepaid expenses                                    -               (3,469)
   Deposits and other                                (5,350)             (294)
   Accounts payable                                 (26,564)            8,141
   Accrued expenses                                   9,305           (20,651)
   Deferred revenue                                 (56,445)          (68,441)
                                                 ----------        ----------

Net cash provided by operating activities       $   142,224       $    40,629
                                                 ----------        ----------

Cash flows from investing activities:
 Property and equipment additions                    (8,865)           (5,437)
 Additions to purchased software                       -                 (690)
                                                 ----------        ----------

Net cash used in investing activities                (8,865)           (6,127)
                                                 ----------        ----------

Cash flows from financing activities:
 Payments of notes payable                           (1,000)             - 
 Payments on capital lease obligations                 (591)           (1,561)
                                                 ----------        ----------
Net cash used in financing activities                (1,591)           (1,561)
                                                 ----------        ----------

Increase in cash and cash equivalents               131,768            32,941
Cash and cash equivalents, beginning of year        478,008           204,807
                                                 ----------        ----------

Cash and cash equivalents, end of period        $   609,776       $   237,748
                                                 ==========        ==========
</TABLE>

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

<PAGE>
                 UNITED SYSTEMS TECHNOLOGY, INC. AND SUBSIDIARY
                   Notes To Consolidated Financial Statements
                                   (Unaudited)

Note 1.  Basis of Presentation:

     In the  opinion of  management,  the  accompanying  unaudited  consolidated
statements  contain  all  adjustments   (consisting  of  only  normal  recurring
accruals)  necessary to present fairly the  consolidated  financial  position of
United Systems  Technology,  Inc. ("USTI") as of March 31, 1999 and December 31,
1998 and the results of  operations  and cash flows of USTI for the three months
ended March 31, 1999 and 1998.  The  consolidated  results of operations for the
three months ended March 31, 1999 are not necessarily  indicative of the results
to be expected for the full year.

Note 2.  Property and Equipment:

     Property and equipment at March 31, 1999 and December 31, 1998 consisted of
the following:
<TABLE>
<S>                                             <C>              <C>

                                                 March 31,       December 31,
                                                   1999             1998
                                                   ----             ----
Leasehold improvements                         $   64,772       $   64,772
Furniture and fixtures                             40,655           40,655
Equipment                                         932,706          923,841
                                                ---------        ---------
                                                1,038,133        1,029,268
Less Accumulated depreciation and amortization   (971,127)        (963,939)
                                                ---------        ---------
                                               $   67,006       $   65,329

</TABLE>
                                                ---------        ---------
Note 3.  Other Assets:

     Other  assets at March 31,  1999 and  December  31, 1998  consisted  of the
following:
<TABLE>
<S>                               <C>              <C>               <C>

                                                  Accumulated 
March 31, 1999                    Cost            Amortization        Net
--------------                    ----            ------------        ---
Goodwill                      $ 1,692,128         $(1,295,459)    $ 396,669
Purchased Software                592,700            (563,792)       28,908

December 31, 1998
-----------------
Goodwill                      $ 1,692,128          (1,278,475)    $ 413,653
Purchased Software                592,700            (559,399)       33,301

</TABLE>

<PAGE>

                 UNITED SYSTEMS TECHNOLOGY, INC. AND SUBSIDIARY
                   Notes To Consolidated Financial Statements
                                   (Unaudited)

Note 4.  Preferred Stock:

     The  company is in arrears in the  payment of  dividends  to holders of its
Series B, D and E  Preferred  Stock.  Holders  of Series B  Preferred  Stock are
entitled to annual  dividends of $.07 per share,  payable  quarterly  and, as of
March 31,  1999,  are  entitled  to the  payment of  approximately  $367,430  in
dividends  which are currently in arrears.  Holders of Series D Preferred  Stock
are entitled to annual dividends of $.07 per share, payable quarterly and, as of
March 31,  1999,  are  entitled  to the  payment of  approximately  $319,315  in
dividends  which are currently in arrears.  Holders of Series E Preferred  Stock
are entitled to annual dividends of $.07 per share, payable quarterly and, as of
March 31,  1999,  are  entitled  to the  payment of  approximately  $163,915  in
dividends which are currently in arrears.


<PAGE>

                 UNITED SYSTEMS TECHNOLOGY, INC. AND SUBSIDIARY

Item 2. Management's Discussion and Analysis of Financial Condition
        or Plan of Operation

Results of Operations
---------------------
     The  Company  derives  its  revenue  from  the  licensing  of its  software
packages,   installation,   training  and  custom   modifications,   maintenance
agreements and equipment  sales and  commissions.  Results of operations for the
period  ended March 31,  1999  include  revenues  of $517,472  and net income of
$116,346 as  compared to revenues of $367,579  and a net loss of $14,347 for the
same period in 1998.

     The  Company is  continuing  its  development  of its asystTM  products,  a
Windows  product line that operates in a single user or network  environment and
is seamlessly  interfaced with the other Microsoft Office products.  The asystTM
product line currently  includes a Fund  Accounting  system,  a Utility  Billing
system and a Public Safety system and has been  installed at over 300 locations.
The Fund  Accounting  system  includes  General  Ledger,  Budget XLence,  Report
XLence, Accounts Payable,  Accounts Receivable,  Purchase Orders, Cash Receipts,
and Payroll modules. The Utility Billing system includes Utility Billing,  Meter
Reader  Interface,  Bank Drafts and Budget Billing  modules.  The initial Public
Safety system includes Master Name Index, Calls for Service, Offense Reports and
UCR Reporting modules.  The Company is currently  developing its asystTM General
Government   products,   which  include  Business  and  Animal  Licenses,   Code
Enforcement  and Building  Permits  modules,  and  anticipates  that the initial
modules will be released in the 2nd quarter of 1999.  The Company  believes that
its asystTM  product  line will  continue  to offer its current and  prospective
customers  with an  attractive  software  solution,  both from a  financial  and
functionality standpoint and follows the trend of clients moving to PC networks.
This trend  resulted in a continued  decrease in the  licensing of the Company's
DOS  (QuestTM ) and  mid-range  (LegacyTM  ) products  in 1999.  The  Company is
offering a Year 2000  version of certain  QuestTM and  LegacyTM  modules and has
received  commitments to license this version of these products and continued to
ship its Year 2000 version of the LegacyTM modules in the 1st quarter of 1999.

Three Month Period Ended March 31, 1999 and 1998
------------------------------------------------
     The Company's  total revenue  increased 41% from $367,579  during the first
quarter in 1998 to $517,472 in 1999.  Software  license fees  increased  164% in
1999 due to an increase in the licensing of the  Company's  Year 2000 version of
its LegacyTM  products as well as an increase in the  licensing of the Company's
asystTM  products.  The Company  continues to market its products to prospective
customers, which it believes are best suited for its products.  Installation and
training  increased to $89,162 in 1999 from $19,342 in 1998 due, in part,  to an
increase in the demand for custom  programming  related to the implementation of
the Year 2000 version of the Company's  LegacyTM products.  Maintenance  revenue
decreased  10% during  1999,  due in part,  to a  decrease  in the number of the
Company's  QuestTM and LegacyTM  customers  that  elected to select  maintenance
coverage.  This  decrease  was  partially  offset by an increase in  maintenance
revenue from the asystTM  customers.  Equipment and supplies sales increased 60%
in the first  quarter  of 1999 due,  in part,  to an  increase  in the volume of
computer equipment sold in conjunction with its products.

<PAGE>

     Total costs and expenses  increased 9% from $382,534 in 1998 to $415,966 in
1999.  Salary  expense  increased  9% in 1999,  due in part,  to an  increase in
incentives  resulting  from  improved  results  of  operations.  Other  general,
administrative  and selling  expense costs  remained at  approximately  the same
level  in 1999 as they  were in  1998.  Depreciation  and  amortization  expense
decreased 22% in 1999 as a result of a portion of the Company's  assets becoming
fully  depreciated  in 1999.  Cost of equipment sold increased 104% in 1999 as a
result of increased sales of computer equipment during the period.

Liquidity and Capital Resources
-------------------------------
     The Company had net cash  provided  from  operating  activities of $142,224
during the three months ended March 31, 1999,  as compared to net cash  provided
by  operations  of $40,629 for the same  period in 1998.  Net cash of $8,865 was
utilized during 1999 for investing in capital expenditures as compared to $6,127
in 1998.

     Management believes that the effect of its continued focus on adjusting the
Company's  expenses  to the  level of  revenue  has  resulted  in a  significant
increase in the Company's  current cash balances and these cash balances will be
adequate to meet its working capital  requirements in the near future.  However,
if the Company is not able to continue  to generate  positive  cash flows in the
future by  achieving a level of sales  adequate to support  the  Company's  cost
structure,  additional  financing  may be  required,  of which  there  can be no
assurance.

     The Company had a $50,000 note payable to Ventana Growth Fund  ("Ventana"),
a related party.  Ventana  distributed  this note to its limited partners in its
fund in 1997.  During 1998,  the Company  offered the note holders the option of
extending  each note for an  additional  two year period or  receiving a partial
payment of the balance due in full and final  settlement  of the  principal  and
interest due to each note holder. As of December 31, 1998, there was $27,083 due
to the  remaining  note  holders and $43,457 of  interest  outstanding  on these
notes.  In 1999  certain  additional  note  holders  opted to  receive a partial
payment  totaling  $1,000 in lieu of the  balance  due of $4,168 on the note and
$6,702 of accrued interest  resulting in a $9,870 gain on settlement of debt. As
of March 31,  1999 there was  $22,915  due to the  remaining  note  holders  and
$37,249 of interest outstanding on these notes.

     The Company is  currently in arrears in the payment of dividends to holders
of its  preferred  stock.  As of March 31,  1999,  dividends  were in arrears on
Series B preferred stock in the amount of $367,430,  on Series D preferred stock
in the  amount of  $319,315  and on Series E  preferred  stock in the  amount of
$163,915.

Year 2000
---------
     Until just a few years ago, most  computer  programs were written to define
an applicable  year by using two digits for the year instead of four. The effect
on a computer program that was written in such a way is to define a year that is
entered  with the two digits "00" as 1900  rather than 2000.  When the Year 2000
arrives,  any computer programs that are written in this manner will either have
to be modified to accept a date in the 21st century or the programs will have to
be  replaced.  This issue not only  affects  the  Company's  internal  automated
information  systems but also has an effect on the software products the Company
develops,  supports and markets to its customers.  The Company has evaluated the
computer  programs that it utilizes  internally for its information  systems and
has  determined  that  substantially  all of its systems are currently Year 2000
compliant.  The  Company's  asystTM  product  line is Year 2000  compliant.  The
Company's  customers that are utilizing its LegacyTM,  and QuestTM product lines
are being offered a Year 2000 compliant version of certain packages within these
product lines or are being encouraged to migrate to the Company's  products that
are Year 2000 compliant.  Based on currently available information,  the Company
does not  anticipate  that the costs to address  the issues  related to the Year
2000 will have a material adverse impact on the Company's  financial  condition,
results of operations or liquidity.

<PAGE>

Forward-Looking Statements
--------------------------
     This report  contains  forward-looking  statements,  other than  historical
facts,  which  reflect the view of Company's  management  with respect to future
events.  Such  forward-looking  statements are based on assumptions  made by and
information currently available to the Company's management. Although management
believes that the expectations reflected in such forward-looking  statements are
reasonable,  it can give no assurance that such  expectations will prove to have
been  correct.  Important  factors  that could  cause  actual  results to differ
materially from such expectations  include,  without limitation,  the ability of
the Company i) to generate  levels of revenue and  adequate  cash flows from its
operations to support and maintain its current cost structure and ii) to develop
and deliver products that are  competitive,  accepted by its markets and are not
rendered  obsolete  by  changing  technology.   The  forward-looking  statements
contained  herein  reflect the current  views of the Company's  management  with
respect to future  events  and are  subject to these  factors  and other  risks,
uncertainties and assumptions relating to the operations,  results of operations
and  financial  position of the Company.  The Company  assumes no  obligation to
update the  forward-looking  statements or to update the reasons  actual results
could differ from those contemplated by such forward-looking statements.

<PAGE>

                           Part II - Other Information

Item 1.  Legal Proceedings

         The Company is involved in the following legal proceedings:

     On December 10, 1993,  Plaintiff  County of Essex filed suit against  USTI,
USTEI, New Jersey Municipal Data Management ("MDM") and MDM's surety in Superior
Court of New Jersey.  The Company filed third party  complaints  against counsel
representing   the  parties  to  the   transaction   for   negligence  in  their
representation  on this matter.  On April 26, 1999, a settlement  was reached in
this  matter,  with all  parties,  whereby  this  case  will be  dismissed  with
prejudice upon the execution of the  documentation  necessary for the settlement
and was reached without material adverse effect to the Company.

     The Company is also a defendant in various legal  actions,  which arose out
of the normal course of business.  In the opinion of  management,  none of these
actions are expected to have a material  effect on the  consolidated  results of
operations or financial position of the Company.

Item 2.  Change In Securities

     Not Applicable


Item 3.  Defaults Upon Senior Securities

     The  company is in arrears in the  payment of  dividends  to holders of its
Series B, D and E  Preferred  Stock.  Holders  of Series B  Preferred  Stock are
entitled to annual  dividends of $.07 per share,  payable  quarterly  and, as of
March 31,  1999,  are  entitled  to the  payment of  approximately  $367,430  in
dividends  which are currently in arrears.  Holders of Series D Preferred  Stock
are entitled to annual dividends of $.07 per share, payable quarterly and, as of
March 31,  1999,  are  entitled  to the  payment of  approximately  $319,315  in
dividends  which are currently in arrears.  Holders of Series E Preferred  Stock
are entitled to annual dividends of $.07 per share, payable quarterly and, as of
March 31,  1999,  are  entitled  to the  payment of  approximately  $163,915  in
dividends which are currently in arrears.

<PAGE>



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

     Not Applicable

Item 5.  Other Information

     Not Applicable


Item 6.  Exhibits and Reports on Form 8-K

     (a) Exhibits - No exhibits are required to be filed with this report.

     (b) No  reports on Form 8-K were filed  during the  quarter  for which this
          report is filed.

<PAGE>

                                   Signatures


     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                                       United Systems Technology, Inc.


Date:  May 14, 1999                    By: /s/  Thomas E. Gibbs
                                           --------------------
                                           Thomas E. Gibbs, President
                                           and Chairman of the Board
                                          (Principal Executive Officer)

Date:  May 14, 1999                    By: /s/  Randall L. McGee
                                           ----------------------
                                           Randall L. McGee, Secretary
                                           and Treasurer
                                          (Principal Financial and
                                            Accounting Officer)

<PAGE>