UNITED STATES
                  SECURITIES AND EXCHANGE COMMISSION
                        Washington, DC   20549
                              FORM 10-QSB

(Mark One)

[x] QUARTERLY REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934

For the Quarterly Period Ended  September 30, 2000
                                ------------------

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

    For the transition period from ______________ to ______________

    Commission file number        010690
                             ____________________


                           Science Dynamics Corporation
     -------------------------------------------------------------------
      (Exact name of small business issuer as specified in its charter)

                                   Delaware
        ------------------------------------------------------------
       (State or other jurisdiction of incorporation or organization)

                                  22-2011859
                      -------------------------------
                     (IRS Employer Identification No.)


          1919 Springdale Road, Cherry Hill, New Jersey   08003
          -----------------------------------------------------
                (Address of principal executive offices)

                      (    856     )     424-0068
          -----------------------------------------------------
                       (Issuer's telephone number)

                                    N/A
      ---------------------------------------------------------------
     (Former name, former address, and former fiscal year, if changed
     since last report)

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 [ ]


            APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
               PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13, or 15(d) of the Exchange Act after the distribution
of securities under a plan confirmed by a court.   Yes [ ]      No [ ]

                  APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:


         11/14/2000    17,657,916 shares of common stock were outstanding.

<PAGE>

           S C I E N C E   D Y N A M I C S   C O R P O R A T I O N

                                   INDEX
                                   -----
                                                                      PAGE NO.
                                                                      --------

PART I.  FINANCIAL INFORMATION

         Item 1. Financial Statements


                 Consolidated Balance Sheets as of September 30, 2000   1
                 (unaudited) and December 31, 1999 (audited)

                 Consolidated Statements of Operations for nine months  2
                 and three months ended September 30, 2000 (unaudited)
                 and nine months and three months ended September 30,
                 1999 (unaudited)

                 Consolidated Statements of Cash Flows for nine months  3
                 ended September 30, 2000 (unaudited) and nine months
                 ended September 30, 1999 (unaudited)

                 Notes to Consolidated Financial Statements             4

         Item 2. Management's Discussion and Analysis of Financial      4 - 13
                 Condition and Results of Operations

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 Vote of Security Holders      14

         Item 5. Other Information                                      14

         Item 6. Exhibits and Reports                                   14

         Item 7. Signatures                                             15


<PAGE>
<TABLE>
                                    SCIENCE DYNAMICS CORPORATION AND SUBSIDIARY
                                            CONSOLIDATED BALANCE SHEETS

<CAPTION>

PART I.   FINANCIAL INFORMATION
          Item 1. Financial Statements:

                                     ASSETS
<S>                                                                              <C>                <C>
                                                                                   September 30,     December 31,
                                                                                      2000               1999
                                                                                    Unaudited          Audited
                                                                                    ---------          -------
Current assets:
   Cash and cash equivalents                                                      $   906,598        $   674,793
   Accounts receivable - trade                                                      1,800,671            157,040
   Accounts receivable - other                                                         74,521             63,677
   Inventories                                                                        199,041            361,039
   Other current assets                                                               134,844             50,185
                                                                                  -----------        -----------
      Total current assets                                                          3,115,675          1,306,734
                                                                                  -----------        -----------

Property and equipment, net                                                           652,308            260,543
Capitalized Software                                                                  144,355                  -
Deferred income taxes                                                                 308,000            308,000
Intangible Assets, net of accumulated
 amortization of $1,125,000 in 2000 and
 $900,000 in 1999.                                                                    375,000            600,000
Other assets                                                                          127,376            133,776
                                                                                  -----------        -----------
      Total assets                                                                $ 4,722,714        $ 2,609,053
                                                                                  ===========        ===========


                      LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
   Current portion of capital lease obligation                                    $    25,917       $          -
   Accounts payable                                                                   476,797            215,409
   Accrued expenses                                                                   110,137            424,677
                                                                                  -----------        -----------
      Total current liabilities                                                       612,851            640,086
                                                                                  -----------        -----------

Long-term portion of capital lease obligation                                          62,327                 -
                                                                                  -----------        -----------
Commitments

Shareholders' equity -
   Common stock - .01 par value,
      45,000,000 shares authorized,
      17,783,716 and 17,286,278 issued
      17,657,916 and 17,160,478 outstanding
       in 2000 and 1999 respectively.                                                 177,837            172,862
   Additional paid-in capital                                                      14,275,287         12,556,205
   (Deficit)                                                                      (10,007,755)       (10,362,267)
                                                                                  -----------        -----------
                                                                                    4,445,369          2,366,800
   Common stock held in treasury,
    at cost                                                                          (397,833)          (397,833)
                                                                                  -----------        -----------
   Total shareholders' equity                                                       4,047,536          1,968,967
                                                                                  -----------        -----------
   Total liabilities and shareholders'
    equity                                                                        $ 4,722,714        $ 2,609,053
                                                                                  ===========        ===========

</TABLE>
-1-
<PAGE>
<TABLE>
                                            SCIENCE DYNAMICS CORPORATION AND SUBSIDIARY
                                               CONSOLIDATED STATEMENTS OF OPERATIONS
                                                          (UNAUDITED)
                                                           ---------

PART I.   FINANCIAL INFORMATION
          Item 1. Financial Statements(Continued):
<CAPTION>


                                                            Nine Months Ended September 30,        Three Months Ended September 30,

                                                                  2000            1999              2000              1999
                                                                  ----            ----              ----              ----

<S>                                                          <C>             <C>                <C>               <C>
 NET SALES                                                    $5,178,155      $1,828,559        $1,630,402         $ 620,335
                                                              ----------      ----------        ----------         ---------


Operating costs and expenses:

      Cost of sales                                            1,807,158         881,072           522,886           447,124
      Research and development                                   883,935         914,677           307,402           298,904
      Selling, general
          and administrative                                   2,201,692       1,403,562           792,617           388,281
                                                              ----------      ----------        ----------         ---------

                                                               4,842,785       3,199,311         1,622,905         1,134,309
                                                              ----------      ----------        ----------         ---------

Operating income (loss)                                          335,370      (1,370,752)            7,497          (513,974)

Other (expenses):
   Interest income                                                22,044             -              13,606               -
   Interest expense                                               (2,902)         (8,728)           (2,902)           (1,823)
                                                              ----------      ----------        ----------         ---------


Net income (loss)                                             $  354,512     $(1,379,480)       $   18,201         $(515,797)
                                                              ==========      ==========        ==========         =========



Net income (loss) per common share                            $     0.02      $    (0.08)       $     0.00         $   (0.03)
                                                              ==========      ==========        ==========         =========



</TABLE>
-2-
<PAGE>
<TABLE>
                          SCIENCE DYNAMICS CORPORATION AND SUBSIDIARY
                             CONSOLIDATED STATEMENTS OF CASH FLOWS
                                         (UNAUDITED)
                                          ---------
<CAPTION>
PART I.   FINANCIAL INFORMATION
          Item 1. Financial Statements(Continued):


                                                             Nine Months Ended September 30,
                                                                   2000           1999
                                                                   ----           ----

<S>                                                           <C>           <C>
Cash flows from operating activities:
   Net income (loss)                                           $  354,512    $(1,379,480)
                                                               ----------     ----------

Adjustments to reconcile net income (loss)
 to net cash used for
 operating activities:
   Depreciation                                                    99,518         67,748
   Amortization of capitalized software                                 -        104,247
   Amortization of Intangible assets                              225,000        225,000
Changes in operating assets and liabilities:
   (Increase) decrease in:
    Accounts receivable                                        (1,643,631)      (227,479)
    Other receivable                                              (10,844)       632,677
    Inventories                                                   161,998        115,661
    Other current assets                                          (84,659)         7,569
    Other assets                                                    6,400        (94,268)
   Increase (decrease) in:
     Advance Deposits                                                   -        259,281
      Accrued expenses                                            (53,152)      (289,093)
                                                               ----------      ---------

Total adjustments                                              (1,299,370)       801,343
                                                               ----------      ---------

 Net cash used for
  operating activities                                           (944,858)      (578,137)
                                                               ----------      ---------

Cash flows from investing activities:

 Purchase of property and equipment                              (399,177)       (39,568)
 Capitalized software                                            (144,355)             -
                                                               ----------      ---------

   Net cash used in investing activities                         (543,532)       (39,568)
                                                               ----------      ---------

Cash flows from financing activities:
 Increase (decrease) in
  Payment on capitalized lease                                     (3,862)             -
  Loan Payable                                                                   166,746
 Issuance of common stock
 and warrants                                                   1,724,057        497,475
                                                               ----------      ---------

   Net cash provided
    by financing activities                                     1,720,195        664,221
                                                               ----------      ---------

Net increase in
 cash and cash equivalents                                        231,805         46,516

Cash and cash equivalents -
 beginning of period                                              674,793         32,249
                                                               ----------      ---------

Cash and cash equivalents -
 end of period                                                 $  906,598      $  78,765
                                                               ==========      =========


</TABLE>
-3-
<PAGE>
               SCIENCE DYNAMICS CORPORATION AND SUBSIDIARY
                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               (unaudited)
PART I
Item 1. (continued)

        Basis of Presentation
        ---------------------

        The unaudited financial statements included in the Form 10-QSB have
        been prepared in accordance with generally accepted accounting
        principles for interim financial information and with the instructions
        to Form 10-QSB and Item 310(b) of Regulation SB.  The financial
        information furnished herein reflects all adjustments, which in the
        opinion of management are necessary for a fair presentation of the
        Company's financial position, the results of operations and the cash
        flows for the periods presented.

        Certain information and footnote disclosures, normally included in
        financial statements prepared in accordance with generally accepted
        accounting principles, have been condensed, or omitted, pursuant to
        such rules and regulations.

        These interim statements should be read in conjunction with the
        audited financial statements and notes thereto included in the
        Company's Annual Report on Form 10-KSB for the fiscal year ended
        December 31, 1999.  The Company presumes that users of the interim
        financial information herein have read or have access to the audited
        financial statements for the preceding fiscal year and that the
        adequacy of additional disclosure needed for a fair presentation may
        be determined in that context. The results of operations for any
        interim period are not necessarily indicative of the results for
        the full year.

        Income per share
        ----------------

        Per-share data has been computed on the basis of the weighted average
        number of shares of common stock outstanding during the periods.
        Shares issuable upon exercise of common stock options and warrants
        are included for the period ended 9/30/00 and excluded for the period
        9/30/99 as they would be anti-dilutive during this period.


Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND
        RESULTS OF OPERATIONS FOR NINE MONTHS ENDED SEPTEMBER 30, 2000 AND
        FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2000.

-4-
<PAGE>

        Business Overview
        -----------------

        Science Dynamics, a designer and manufacturer of intelligent
        telecommunications platforms for over twenty years, has been trading
        publicly since 1981. In 1996, Science Dynamics acquired Innovative
        Communications Technology, Ltd. and refocused the business to take
        advantage of emerging packet network markets with a diversified
        product line to supplement the company's existing traditional market
        products. The company has restructured and repositioned itself to
        compete in the new global telecommunications marketplace.  In
        recognition of this redirection, we adopted a new trademark, SciDyn.

        SciDyn is continuing to focus its strategy on becoming a key provider
        of enabling technologies required for the convergence of traditional
        and new communications media infrastructures.

        The global telecommunications industry transformation of shifting
        traditional circuit switched traffic such as voice and fax to new
        packet based networks is advancing rapidly. The lower cost of
        packet-switched networks initially drove this change, however, the
        improving quality and reliability of voice over these networks is
        accelerating the integration process.

        Over the next decade, it is anticipated that a large majority of
        voice networks in service today will be replaced by packet
        infrastructure.  This should provide two major opportunities as the
        transition evolves.  The first opportunity is a need to bridge the
        old circuit switched networks with newer packet based networks.  This
        challenge demands high quality dependable gateway equipment and
        services.

        The second opportunity is that new emerging carriers building from
        the ground up on these advanced packet based networks require
        equipment that can help them offer the services and features that are
        currently deployed in the existing circuit switched networks.
        Certainly the deciding factor will be up to the public and corporate
        users of these networks.  Traditional telecom carriers are currently
        in an intense battle to keep customers and prevent costly churning of
        user accounts.  Offering more advanced features with realizable
        benefits to the end user is an important element.  This will hold
        true as packet-based network providers attempt to lure customers to
        their new technology.  One key factor here is the ability to provide
        new features at a faster pace than the competition. Packet based
        networks and much of the technology supporting this network rely
        more heavily on software driven systems.  These systems along with
        the inherent ability of these networks to overcome distance and
        access to data obstacles means a greater ability to provide features
        quickly and more creatively then ever before.

        SciDyn's gateway system is based on a unique BubbleLINK(r) software
        architecture which allows multiple and varied applications to be
        designed and deployed quickly and effectively.

        Management believes that current products and development strategy
        teamed with SciDyn's strong telecommunications background will provide
        a solid product to meet customer needs and the advancements required
        for the packet based telecom revolution.

        PRODUCTS
        --------

        IP Telephony

        SciDyn's IP Telephony products are designed to enhance the new
        operators' abilities to combine the technologies of the new IP based
        networks with the traditional feature rich circuit networks without
        forfeiting the key functionality of IP network-adaptability.

-5-
<PAGE>
        The SciDyn system features a modular architecture that permits our
        customers to add new product and service features without significant
        cost or development time. Based on publicly available data
        provided by large telecommunications service providers, we believe
        our modular architecture enables the provision of new and existing
        communications services at a lower cost than the provision of
        communications services by traditional telephone companies. The IP
        Integrator product range addresses the various market segments.  The
        IntegratorC-2100(r) Series focus is corporate enterprises, the
        IntegratorC-2300(r) focus is for large ISPs and Telco Carriers and
        the IntergratorC-2500(r) Series focus is intended to address the
        needs of PTT/Telco Carriers.

        The SciDyn differentiator for the carrier class IP Telephony market
        is our proprietary software solution, BubbleLink(r).  This software
        enhances the IntegratorC-2000(r) series of IP Gateways by providing
        functionality, such as easily manipulated voice response announcements
        and adaptability, i.e. the integration of third party software
        applications quickly and efficiently giving operators the ability to
        stay ahead of the competition.

        SciDyn offers BubbleLink(r) throughout its current IP Telephony
        Gateway product range.  This includes our high capacity versatile
        IntegratorC-2308(r), which has one of the smallest footprints in the
        industry.

        The IntegratorC-2500(r) series is capable of housing anywhere from
        3360 lines up to over 5,000 lines to meet the largest carrier
        requirements.

        SciDyn continues to fulfill its first contract for its new C-2308
        Integrators. Our supply agreement with Cascadent Communications, Inc.
        is moving forward with the insertion of Hewlett Packard as prime
        procurer of SciDyn's product line for the next generation IP
        Telephony network.  To date we have shipped $4,370,520 of the
        anticipated $13,000,000 contract.

        We are seeking partners to expand our distribution base and are
        pursuing prospects in Europe and Asia. In October 2000 Scidyn
        signed a distribution agreement with Telecommunications and Security
        Systems Limited (TSSL).  TSSL will distribute Scidyn's IP Telephony
        Gateway products for use in customer projects in China, Philippines
        and Malaysia.  Continuing business development in the region has
        yielded a number of relationships and potential partnerships, which
        provide access to key players within each region.

        SciDyn plans to introduce several new models into the
        IntegratorC-2000 gateway family, as well as, to provide enhancements
        to existing software.  Future new models will include the
        IntegratorC-2312-F high-density gateway products targeted for high
        port count, Fax over IP applications, and the R-1000 products targeted
        for medium to large-scale enterprises requiring integrated routers.
        Some of the currently scheduled development efforts include simple
        network management protocol (SNMP) monitoring and configuration which
        will be completed by the middle of the fourth quarter, speech
        recognition, text to speech capabilities, and dynamic application
        deployment technology are scheduled for completion by the end of the
        first quarter of 2001.

-6-
<PAGE>

        Video over Frame Relay

        In 1997 SciDyn launched their new way to carry video conferencing.
        The VFX-250S is a hardware based Frame Relay Access Device (FRAD)
        designed to carry video streams through the frame relay network.  As
        the largest data network protocol in the world, frame relay seemed an
        obvious choice for adding video connectivity to its wide complement
        of features.

        Traditionally, video conferencing has been carried via leased lines
        or ISDN circuits.  In the US market, due to the proliferation of ISDN
        availability, video conferencing has been able to take off with a
        relatively high growth curve.  This is not true in the international
        markets where leased lines and ISDN circuits are either not readily
        available or prove to be rather costly.  Video conferencing suite
        manufacturers such as PictureTel, the industry leader, found markets
        outside of ISDN enabled networks have proven to be slow and tedious.

        By leveraging the proliferation of frame relay networks throughout
        the world SciDyn intends to market the VFX-250 products in markets
        where ISDN and leased line services are not available.  This has
        proven very successful in the past in  markets such as Brazil.

        Recent discussions and visits to China, where three countrywide frame
        relay networks are presently under construction, have created
        opportunities with all of the new network operators. Trials are
        continuing and we continue to anticipate possible business
        opportunities in the latter part of 2000 or the early part of 2001.

        SciDyn continues to build on the relationships it has developed with
        data networking partners and continues to be a component of their
        network offering. A recent acquisition of one of our distribution
        partners has forced SciDyn to look for alternative distribution
        arrangements.

        Sales of the VFX-250S have been slow throughout 2000.   There are a
        number of large-scale projects quoted late last year, which have not
        yet been awarded.  These include opportunities in China and Russia.
        Brazil continues to proceed steadily and is anticipated to provide
        sales. With some expected further development of the VFX family and
        some investment in the promotion of the product line we continue to
        anticipate an overall increase in sales over the next twelve months.
        In order to maximize our market potential, Scidyn is working on
        making the VFX product interoperable with Sony equipment.

        Commander Inmate Telephone Control System (ITCS)

        The Commander product lines are based on the Company's new
        IntegratorC-2000(r) platform.  This open system platform is a
        combination of integrated Computer Telephony (CTI) hardware and
        software, which can handle thousands of call transactions per hour
        and provide correctional facility officials with effective tools to
        manage and control inmate telephone calls using the Commander system
        software.

        The Commander I products are generally wall mounted platforms that
        have been designed for the small to mid sized municipal and county
        correctional facilities requiring control for up to 40 inmate
        telephone lines.  The Commander I base system provides telephone
        control for 4 lines and can be expanded in 4 line increments. This
        modular design provides a cost effective solution with an abundance
        of inmate phone control features.

        Commander II platforms are generally rack mounted and can house up to
        96 inmate telephone lines. Multiple platforms can be daisy-chained
        for systems requiring control of more than 96 lines.

        The Commander I and II systems can be configured using one or more
        AdminManager workstations. The AdminManager provides real-time
        administration of the Commander system through an Ethernet Local
        Area Network (LAN) or a Wide Area Network (WAN). During this year
        the company released a new Commander II AdminManager software module.
        This new software module provides the Commander II with a
        sophisticated Graphical User Interface (GUI) with new inmate phone
        control features. These new features were based on recommendations
        by several of the Company's major customers. Additionally, the
        Company completed development on the Commander II Voice Recognition
        feature. The Company expects to complete the Commander II Integrated
        Recording and Inmate debit systems by the second quarter of 2001.

-7-
<PAGE>

        The Company continues to explore business opportunities with large
        telephone companies in providing the Commander II inmate phone
        control system with call transaction (price per call) programs.
        Scidyn believes that such a collaboration will allow Scidyn to bid on
        much larger projects and open doors to projects to which we were
        heretofore precluded from bidding  because we could not provide a
        complete solution.  Such an arrangement would greatly enhance the
        Commanders utility in the marketplace, as well as, provide an
        additional stream of revenue from an existing product.


        Error Correction Algorithm

        The Company acquired the "Error Detection and Correction System
        for Use with Address Translation Memory Controller" patent, in
        exchange for 172,029 shares of common stock then valued at
        $100,000.  Such patent provides the Company with the ability to
        embed in certain technology an error correction method that should
        substantially reduce data transmission errors.  This correction
        device is designed to reduce costly retransmission and can be
        utilized across various data transport mediums.

        The patent, which we intend to make available to others on a royalty
        basis, can be utilized on virtually any data transmitting system,
        from fiber optics to satellite transmission.  Since both transmitting
        and receiving stations must utilize the same algorithm, the Company's
        primary task is to initially convince new or redesigned applications
        to utilize SciDyn's patent for each end of the application.  Scidyn
        continues to pursue a third party to undertake the implementation of
        this algorithm.  If a suitable entity is not found in the near term
        to exploit this new technology the carrying value of the patent may
        be impaired.

        The Patent, which has been issued in the United States with
        application in many foreign countries, is for a data transmission
        system for use in a mass memory system, which includes an EDAC that
        corrects all single component errors and detects all double component
        errors.  High-speed operation permits use of the EDAC on address and
        control lines as well as on data lines.  In memory systems, which use
        virtual memory addressing, further efficiency and economy is achieved
        by incorporating a partial implementation of the EDAC encoding in the
        same virtual memory address translation unit in which the virtual
        memory address is calculated.

        We believe the Error Detection and Correction Device is directly
        applicable to SciDyn's business including landline, internet, and
        radio frequency uses such as wireless (local area networks) LAN's and
        satellite transmissions.

        The SciDyn Forward Error Correction algorithm is the first truly new
        advancement in the field of digital error detection and correction in
        several decades. This algorithm is a class of computable codes that
        were previously generally believed not to exist.

        At the present time there is one issued patent. There are many
        upgrades to the patented material that can be patented that are now
        trade secrets. These include both revisions to the algorithm and
        implementation approaches.

-8-
<PAGE>


        Voice Response System

        The Company's Voice Response System (VRS) is an automatic intercept
        product designed to provide a cost-effective solution for
        implementing announcement capabilities at the central office
        location.  This product is in the mature stage of the product life
        cycle and we anticipate it will be discontinued shortly.  A base line
        revenue stream will be generated from support of this product.

        Future Product Development

        To better enable future product development, SciDyn has opened an
        Internet development lab in its Cherry Hill facility. This facility
        is designed to provide cooperative multi-vendor development as well
        as to provide SciDyn with a complete R&D test bed.

        Current participants in addition to Cascadent Communications, Inc.,
        include Cisco, Hewlett-Packard,  Belle Systems, Oracle, Natural
        MicroSystems, and ComPro Technology. Utilizing the lab with full
        cooperation of the various participants, SciDyn is able to completely
        test interoperability across vendor platforms and systems.

        The lab is comprised of three major data hubs simulating a live
        worldwide data network. Additional network facilities include several
        regional and corporate enterprise WAN segments. The major network has
        over 800 MBits of bandwidth plus a live data connection to a major
        worldwide Internet backbone provider. SciDyn has full access to this
        facility and provides full-time development support to all of the
        participating vendors. Using this facility, SciDyn can co-develop
        applications with major industry leaders.

        The lab also provides a showcase to current and potential customers.
        It allows a place for customers to present and test new ideas with
        the guidance and support of participating industry leaders such as
        SciDyn, Cisco, and Hewlett-Packard.

        IntegratorC-2000(r) Gateway Future Development

        Future SciDyn development strategies will involve the exploration of
        new Internet data and telephony standards. SciDyn would like to
        position technical staff members on appropriate standards committees.

        In addition, SciDyn is investigating the generation of a working
        standard to embody the core concepts of BubbleLINK(r).  Such a
        standard will open the door for other vendors to develop applications
        that can reside within a BubbleLINK(r) network. Also under review is
        the feasibility of standardizing the Integrator call-processing
        engine as a platform-independent means to create and deliver new
        services on an IP media gateway.

        As new hardware technology becomes available, SciDyn will incorporate
        the capabilities of advanced system designs to increase the scope of
        the current product. Specifically, SciDyn continues to explore the
        integration of a high-density DS3 network interface card. SciDyn will
        also continue to explore the creation of new Internet-based service
        offerings.


        Results of Operations
        ---------------------

        The following table summarizes the basic results of operations for
        the periods indicated in the Consolidated Statement of Operations.

        Nine Months ended September 30, 2000 (unaudited) compared to the
        Nine Months ended September 30, 1999 (unaudited).

                                                    Nine Months Ended
                                                       September 30,
                                                   2000            1999
                                                   ----            ----
           Sales                              $ 5,178,155     $ 1,828,559
           Net Income (Loss)                    $ 354,512     $(1,379,480)
           Net Income (Loss) Per Share             $ 0.02          $(0.08)


                                    OPERATING EXPENSES       PERCENT OF SALES

                                      2000        1999         2000      1999
                                      ----        ----         ----      ----

          Cost of Goods Sold     $1,807,158  $  881,072         35%      48%

          Research & Development $  833,935  $  914,677         16%      50%

          Sales, General & Admin $2,201,692  $1,403,562         43%      77%

          Total Operating Costs
          and Expenses           $4,842,785  $3,199,311         94%     175%


        Sales for the nine-month period of 2000 were $5,178,155 an increase of
        $3,349,596 from sales of $1,828,559 in the corresponding period in
        1999. This increase is directly related to the sales of the
        Integrator Series during 2000.  The business focus has continued
        undaunted to initiate and promote a full-scale sales and marketing
        program aimed at obtaining commitments and eventual orders for the
        Voice over IP Gateways from those customers who have already
        evaluated the IP technology.

        Cost of Goods sold increased to $1,807,158 in the first nine months
        of 2000 from $881,072 in the corresponding nine-month period of 1999.
        The increase in the cost of goods sold was directly related to the
        increase in sales revenue.  The improvement of the gross margin is
        related to the low sales volume and the increase in the unit price
        of replacement boards procured at low volumes during 1999.

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<PAGE>

        Research & Development expenses decreased to $833,935 in the first
        nine months of 2000 as compared to $914,677 in the comparable
        nine-month period of 1999.  The decrease in research and development
        expenses during this period is a combined result of a decrease in
        engineering consulting services and related expenses. We believe our
        success will depend, in part, on our ability to develop and introduce
        new products and enhancements to our existing products.  We have
        expanded our development team during October 2000 and intend to
        continue to make, significant investments in research and development.

        Sales, General & Administrative expenses increased to $2,201,692 for
        the nine-month period of 2000, compared to $1,403,562 in the
        corresponding period of 1999.  The primary reason for the increase
        is the costs associated with the services of Altus Group, the
        Philadelphia based public relations and marketing company, plus
        increased presence at industry trade shows, marketing materials,
        additional sales people hired during the second and third quarter and
        the addition of administrative staff.   We expect to incur
        substantial expenditures related to sales and marketing activities and
        in the expansion of our domestic and international distribution
        channels.


        Three Months ended September 30, 2000 (unaudited) compared to the
        Three Months ended September 30, 1999 (unaudited).

                                                    Three Months Ended
                                                       September 30,
                                                   2000            1999
                                                   ----            ----
           Sales                              $ 1,630,402      $  620,335
           Net Income (Loss)                  $    18,201      $ (515,797)
           Net Income (Loss) Per Share             $ 0.00          $(0.03)


                                    OPERATING EXPENSES       PERCENT OF SALES

                                      2000        1999         2000      1999
                                      ----        ----         ----      ----

          Cost of Goods Sold     $  522,886  $  447,124         32%      72%

          Research & Development $  307,402  $  298,904         19%      48%

          Sales, General & Admin $  792,617  $  388,281         49%      63%

          Total Operating Costs
          and Expenses           $1,622,905  $1,134,309        100%     183%


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<PAGE>

        Cost of Goods sold in the three months ended September 30, 2000 was
        $522,886 as compared to $447,124 in the corresponding period of 1999.
        The cost of goods sold as a percentage of sales amounted to 32% and
        72% for the three months periods ending September 30, 2000 and
        September 30, 1999, respectively.  The decrease in the cost of sales
        as a percentage of sales  was due to the low sales volume and the
        increase in the unit price of replacement boards procured at low
        volumes during 1999.

        Research & Development expenses increased from $298,904 in the second
        quarter of 1999 to $307,402 in the corresponding quarter of 2000.  We
        believe our success will depend, in part, on our ability to develop
        and introduce new products and enhancements to our existing products.
        Due to the technological nature of the Company's business and the
        anticipated expansion of its technology into new applications,
        management expects continual investment for development and
        engineering expenses.

        Sales, General & Administrative expenses increased to $792,617 for
        the three-month period of 2000, compared to $388,281 in the
        corresponding period of 1999.  The primary reason for the increase
        is the costs associated with the services of Altus Group, the
        Philadelphia based public relations and marketing company, plus
        increased presence at industry trade shows, marketing materials,
        additional sales people hired during the second and third quarter and
        the addition of administrative staff.   We expect to incur
        substantial expenditures related to sales and marketing activities
        and in the expansion of our domestic and international distribution
        channels.

        LIQUIDITY AND CAPITAL RESOURCES:
        --------------------------------

        Cash and cash equivalents increased to $906,598 for the period ended
        September 30, 2000 from $674,793 at December 31, 1999.  Net cash used
        for operating activities was $944,858 during the nine-month period
        ended September 30, 2000 compared to $578,137 in the corresponding
        period of 1999.

        Cash used in investing activities was $543,532 for the nine-month
        period ended September 30, 2000 compared to $39,568 in the
        corresponding period of 1999.  The outlay reflects the continual
        investment in computer related equipment, leasehold improvements,
        and further development efforts.

        Net cash provided by financing activities was $1,720,195 for the
        nine-month period ended September 30, 2000.   This amount is related
        to the sale of 200,650 common shares at $8.50 per share which netted
        $1,570,149, the finders fee from this transaction included the
        issuance of 13,115 warrants to purchase common shares.  The remaining
        increase in financing activities of $153,908 was related to the
        exercise of stock options by employees of the Company, offset by
        the payment on the capitalized lease.

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<PAGE>
        The Company has financed its recent operations with cash from
        operations and from the proceeds of private placements of its
        securities. We believe that based on our future forecasts relating to
        operations along with the commitments received to date the Company
        will have sufficient cash to satisfy our estimated cash requirements
        for working capital needs. However, SciDyn has committed itself to
        developing best-in-class technology to pilot the IP revolution as the
        Voice of IP Telephony.  Our goal is to act as the catalyst for the
        rapid deployment of new voice and data services.   To implement our
        business strategy the company may require resources greater than our
        available cash or than are otherwise available. In such event, the
        Company may be required to raise additional capital through equity
        financing.

        Certain statements contained in the 10QSB concerning the Company's
        business outlook on future performance and statements concerning
        assumptions made or expectations as to any future events, conditions
        or other matters are "forward-looking statements" as that term is
        defined under the Federal Securities Laws.  Forward-looking
        statements are subject to risks, uncertainties and other factors,
        which may cause actual results to differ materially from those set
        forth in this report.  The Company may encounter competitive,
        technological, and financial and business challenges making it more
        difficult to market its products and services, the impact of which
        may in turn affect the Company's results of operations and financial
        position.


PART II.OTHER INFORMATION

SCIENCE DYNAMICS CORPORATION AND SUBSIDIARIES
_____________________________________________

Item 1. Legal Proceedings

        No material developments.

Item 2. Changes in Securities

        None

Item 3. Defaults Upon Senior Securities

        None

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

        None.

Item 5. Other Information

        None.

Item 6. Exhibits and Reports

        (a) Exibit 27 FDS-Financial Data Schedule
        (b) Reports on Form 8-K
            None


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<PAGE>

Item 7. Signatures

        Pursuant to the requirements of Section 13 or 15(d) of the Securities
        Exchange Act of 1934, registrant has duly caused this report to be
        signed in its behalf by the undersigned thereunto duly authorized.



      Signature                Title                        Date
      ---------                -----                        ----

 BY:  /s/ Joy C. Hartman       CEO, President and           November 14, 2000
      ---------------------    Director                     -----------------
      Joy C. Hartman


 BY:  /s/ Robert O'Connor      Vice President and           November 14, 2000
      ---------------------    Chief Accounting Officer     -----------------
      Robert O'Connor



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