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                     U.S. 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 quarterly period ended   September 30, 1997
                                          
                         Commission File No.:   0-10854 
                                       
                                       
                              ORS AUTOMATION, INC. 
       (Exact name of small business issuer as specified in its charter)
                                       
                                       
             DELAWARE                        13-27956-75 
   (State or other jurisdiction of       (I.R.S Employer identification No.)
  incorporation or organization)

          402 Wall Street, Princeton, New Jersey        08540 
          (Address of principal executive offices)   (Zip Code)

                                 (609) 924-1667 
                (Issuer's telephone number, including area code)

     Check whether the issuer (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 

     Check whether the issuer has filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Securities Exchange
Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes /X/   No

     As of September 30, 1997, 8,082,443 shares of the registrant's Common
Stock and 12,000,000 shares of Class A Common Stock were outstanding.

     Transitional Small Business Format.  Yes    No /X/  


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                              ORS AUTOMATION, Inc.


                              INDEX TO FORM 10-QSB
                               September 30, 1997
                                       
                                                             Page

Part I - Financial Information

   Item 1. Financial Statements:

      Unaudited Balance Sheet - September 30, 1997              3
                
      Unaudited Statements of Operations and Accumulated
                Deficit for the Three and Nine Months
                Ending September 30, 1997 and 1996.             4

      Unaudited Statements of Cash Flows for the Nine
                  Months Ending September 30, 1997 and 1996.    5

      Notes to Financial Statements.                            6

   Item 2. Management's Discussion and Analysis of Financial
               Condition and Results of Operations.            7,8

Part II - Other Information                                     8

Signatures                                                      9





























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PART I   FINANCIAL STATEMENTS

                         ORS AUTOMATION, INC.
                       UNAUDITED BALANCE SHEET
                          SEPTEMBER 30, 1997
<TABLE>
<S>                                                 <C>
             ASSETS

Current Assets:
  Cash                                              $    382,358
  Accounts receivable                                    272,600
  Inventory, net                                         102,298
  Prepaid expenses                                         1,188
                                                       ----------
      Total Current Assets                                758,444 

Property and Equipment, net                                11,434
                                                        ---------
      TOTAL ASSETS                                   $    769,878
                                                     =============      

      LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities:
  Accounts payable and accrued expenses              $     34,893
                                                     -------------
                           Total Current Liabilities       34,893
  
Priority Tax Claims Payable - Interest                    146,379
Priority Tax Claims Payable - Principal                   179,577
Note Payable - related party                              166,102
Accrued Interest Payable - related party                  244,165       
                                                        -----------
      Total Liabilities                                   771,116 

Stockholders' Deficit:
  Preferred stock                                          10,000
  Common stock                                            122,824
  Capital in excess of par                             24,914,163
  Accumulated deficit                                 (25,048,225)
                                                      -----------
      Total Stockholders' Deficit                          (1,238)
                                                        ----------

      TOTAL LIABILITIES AND STOCKHOLDERS'
        DEFICIT                                      $    769,878
                                                    ===============      
</TABLE>







The Notes to Financial Statements are an integral part of this
statement      
                  

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                           ORS AUTOMATION, INC.
         UNAUDITED STATEMENTS OF OPERATIONS AND ACCUMULATED DEFICIT       
       FOR THE THREE and NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
<TABLE>
<CAPTION>
                                            Three Months Ended September 30,
                                            --------------------------------
                                                    1997           1996       
                                                  ------          ------
<S>                                           <C>            <C>
Sales                                         $   287,032    $  332,872
Cost of Goods Sold                                201,294       233,213
                                                  --------     --------  
         Gross Profit                              85,738        99,659

Administrative, Marketing and General
   Expenses                                        72,055        69,158
                                                  --------     --------
Income (Loss) from Operations                      13,683        30,501 

Other (Income) Expense
   Bad debt Expense                                   ---          ---   
   Interest Income                                 (1,367)        (419)
   Interest Expense                                 9,057        10,147  
   Depreciation and Amortization                    1,647         2,034
                                                  ---------    ---------
            Total Other (Income) Expense, net       9,337        11,762
                                                  ---------    ---------
Income (Loss) Before Provision for Income Taxes     4,346        18,739

Provision for Income Taxes                            ---          ---
                                                   ---------   ---------
Net Income (Loss)                                   4,346        18,739

Accumulated Deficit, Beginning of Period      (25,052,770)    (25,261,770)    
                                               ------------ --------------
Accumulated Deficit, End of Period           $(25,048,225)   $(25,243,031)
                                              ============= ==============
Income (Loss) per Share of Common Stock      $       .00    $     .00 
                                               ============= =============
Weighted Average Number of Common
  Shares Outstanding                            20,082,443    20,070,216
                                               ============  ==============
</TABLE>











The Notes to Financial Statements are an integral part of this
statement      
                  

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<TABLE>
<CAPTION>
                                              Nine Months Ended September 30,
                                            ---------------------------
                                                    1997          1996        
                                                  ------         ------
<S>                                           <C>            <C>
Sales                                         $   962,625    $   802,890
Cost of Goods Sold                                610,167        613,259
                                                  --------       --------  
         Gross Profit                             352,458        189,631

Administrative, Marketing and General
   Expenses                                       218,603        209,044
                                                  --------       --------
Income (Loss) from Operations                     133,855        (19,413)

Other (Income) Expense
   Bad debt Expense                                16,500           ---   
   Interest Income                                 (3,970)        (3,830)
   Interest Expense                                27,121         30,327  
   Depreciation and Amortization                    4,750          5,378
                                                  ---------      ---------
          Total Other (Income) Expense, net        44,451         31,875
                                                  ---------     ---------
Income (Loss) Before Provision for Income Taxes    89,404        (51,288)

Provision for Income Taxes                            ---           ---
                                                   ---------     ---------
Net Income (Loss)                                  89,404        (51,288)

Accumulated Deficit, Beginning of Period      (25,137,629)    (25,191,743)    
                                               ------------  -------------
Accumulated Deficit, End of Period           $(25,048,225)   $(25,243,031)
                                              =============  ==============
Income (Loss) per Share of Common Stock      $       .00    $      (.00)
                                               ============= =============
Weighted Average Number of Common
  Shares Outstanding                            20,082,443      20,070,216
                                               ============  ==============
</TABLE>















The Notes to Financial Statements are an integral part of this statement      
                  

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                         ORS AUTOMATION, INC.
                 UNAUDITED STATEMENTS OF CASH FLOWS          
        FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
<TABLE>
<CAPTION>
                                                        1997        1996
                                                       ------     ------
<S>                                             <C>              <C>
Cash Flows From Operating Activities:
 Net Income (Loss)                              $     89,404     $   (51,288)
 Adjustments to reconcile (loss) to net cash
   provided by (used in) operating activities:
    Depreciation and amortization                      4,750           5,378
    Changes in assets and liabilities:
      Accounts receivable                             99,487          96,227
      Inventory                                       (8,843)         (7,502)
      Prepaid expenses                                 1,682             691
      Accounts payable and accrued expenses            4,995          (3,670)
      Accrued interest payable-priority tax claims    12,222          15,378
      Accrued interest payable-related party          14,949          14,949  
       Net Cash Provided By (Used In) Operating      ---------       --------
           Activities                                218,646          70,163 

Cash Flows From Investing Activities:
 Purchase of property and equipment                   (4,741)         (8,395)
                                                     --------         -------
       Net Cash Used in Investing Activities          (4,741)         (8,395)

Net Increase in Cash                                 213,905          61,768 

Cash at Beginning of the Period                      168,453          59,162
                                                    --------          -------
Cash at End of the Period                       $    382,358     $    102,930
                                                   ============= ============

      
Supplemental Disclosure of Cash Flow Information:
 Cash paid during the period for:
   Interest                                     $       --       $        --  
   Income taxes                                 $       --       $        297 

</TABLE>

Supplemental Schedule of Noncash Investing and Financing Activities:

   Pursuant to the Plan of Reorganization, $45,000 of 5% convertible
   debentures and $40,000 of 11- 1/2% convertible debentures were
   converted into 6,003 and 33,680 shares, respectively, of common stock
   during the quarter ended March 31, and June 30, 1996, respectively. No     
   debentures were converted for this nine month period ending September 30,  
   1997.










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                           ORS AUTOMATION, INC.
        
                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                (Unaudited)

Note 1 - Basis of Presentation

     The unaudited financial statements included herein have been prepared by
the Company pursuant to the rules and regulations of the Securities and
Exchange Commission. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for
complete financial statements. The unaudited interim financial statements as
of September 30, 1997 and 1996 reflect all adjustments (consisting of normal
recurring accruals) which, in the opinion of management, are considered
necessary for a fair presentation of the results for the periods covered.

     The Unaudited Statements of Operations for the three months and nine
months ended September 30, 1997 and 1995 are not necessarily indicative of
results for the full year.

     While the Company believes that the disclosures presented are adequate
to make the information not misleading, these financial statements should be
read in conjunction with the financial statements and accompanying notes
included in the Company's Current Report on Form 10-KSB dated December 31,
1996.

Note 2 - Preferred and Common Stock

     The preferred stock of the Company has a par value of $.01 per share and
1,000,000 shares have been authorized to be issued. All are outstanding at
September 30, 1996. 

     The common stock of the Company has a par value of $.01 per share and
10,000,000 shares have been authorized to be issued. As of September 30, 1996,
8,082,443 shares are outstanding.

     The Company also has Class A common stock, which has a par value of
$.0035 per share and 12,000,000 shares have been authorized to be issued.
All are outstanding at September 30, 1996.

Note 3 - Income Per Share

     Income per share has been computed based upon the weighted average
number of shares of the sum of both common stock and Class A common stock
outstanding during the period.
 
 











The Notes to Financial Statements are an integral part of this statement       


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                            ORS AUTOMATION, INC.
             MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                    CONDITION AND RESULTS OF OPERATIONS

GENERAL

In 1995, a major product development effort resulted in a new
"WINDOWS" based vision system which was expanded to a "WINDOWS 95" based
operating in 1996. These systems accounted for approximately 80% of the total
sales generated in the nine months ending September 30, 1997. An effort to
broaden the Company's product base resulted in approximately 19.7% of sales in
the nine months ending September 30, 1997 being related to motion control
systems and software. 


                            RESULTS OF OPERATIONS
            FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1997
        COMPARED TO THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1996

Sales for the three month period ended September 30, 1997 decreased 13.8% to
$287,032 as compared to $332,872 for the three month period ended September
30, 1996. This decrease in sales revenue was primarily due to competitive
price pressures resulting in price reductions combined with a slowdown in
sales to a major customer while its product line is being redesigned. Sales
for the nine month period ended September 30, 1997 increased by 19.9% to
$962,625 as compared to $802,890 for the nine month period ended September 30,
1996. The gross profit percentage increased to 36.6% for the nine month period
ended September 30, 1997 as compared to 23.6% for the nine month period ended
September 30, 1996. These improvements in Company performance are largely due
to increased software content in sales which lowers the cost of goods sold and
reduced computer hardware costs on delivered equipment. The gross profit
percentage for the three months ended September 30, 1997 and September 30,
1996 was constant at 29.9%.
   
The Company's administrative, marketing and general expenses increased by 4.2%
to $72,055 as compared to $69,158 and 4.6% to $218,603 as compared to
$209,044, respectively, for the three and nine month periods ended September
30, 1997 and September 30, 1996. This increase was primarily due to higher
travel and marketing expenses as more efforts were placed on developing
additional customers.

The income from operations for the three and nine month periods ended
September 30, 1997 was $13,683 and $133,855, respectively, as compared with
income of $30,501 and a loss of $19,413, respectively, for the three and nine
month periods ended September 30, 1996. 

The Company's other expenses for the three months ended September 30, 1997
decreased by 20.6% to $9,337 as compared to $11,762 for the three month ended
September 30, 1996. The Company had a bad debt expense of $16,500 for the nine
month period ended September 30, 1997 which was primarily responsible for the
39.4% increase in other expenses to $44,451 from $31,875 for the comparable
nine month period in 1996.

The Company had net income of $4,346 and $89,404 for the three and nine months
ended September 30, 1997, as compared to net income of $18,739 and a net loss
of $51,288 for the three and nine months ended September 30, 1996.   



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LIQUIDITY AND CAPITAL RESOURCES

The Company has very limited funds to meet its working capital requirements.
To date the Company has been unable to obtain any bank financing and there is
no assurance that it will be available to the Company from any other sources.

On May 10, 1993, August 10, 1993, November 10, 1993, February 10, 1994, May
10, 1994 and August 10, 1994, payments totaling $45,500, $31,500, $42,000,
$63,000, $73,500 and $42,500, respectively, were due to the Internal Revenue
Service and various State taxing authorities pursuant to the bankruptcy
reorganization plan approved on April 8, 1991. As the Company required cash
for operating capital, payments were not made on the due date; however, a
payment of $45,500 was made on December 12, 1996 and the remaining payments
have been deferred as permitted in the Reorganization Plan. The Company has
had initial communications with the Internal Revenue Service in an attempt to
settle its outstanding obligations, however, no agreement has been reached.

Net cash provided by operating activities was $218,646 for the first nine
months of 1997 as compared to net cash provided by operating activities of
$70,163 for the comparable period in 1996. The increase in net cash provided
in 1997 was primarily due to the net income from operations as adjusted for
depreciation and amortization, of $94,154  a decrease in accounts receivable
of $99,487, an increase in accounts payable and prepaid expenses of $6,677,
an increase in accrued interest payable totalling $27,171 and less an increase
in inventory of $8,843, The Company also used $4,741 in investing activities
for the purchase of property and equipment. The net cash increase of $213,905
for the first nine months of 1997 resulted in a cash balance of $382,358 at
September 30, 1997.


 

                       PART II - OTHER INFORMATION

                             NONE























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                               SIGNATURES

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

                       ORS AUTOMATION, INC. 
                           (Registrant)

                   
Date:   November 6, 1997               /s/ Edward Kornstein     
                        
                                         Edward Kornstein
                                             President
                                            (Treasurer)





































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