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  March 31, 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:


         05/15/2000    17,444,151 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 March 31, 2000        1
                 (unaudited) and December 31, 1999 (audited)

                 Consolidated Statements of Operations for three months  2
                 ended March 31, 2000 (unaudited) and three months
                 ended March 31, 1999 (unaudited)

                 Consolidated Statements of Cash Flows for three months  3
                 ended March 31, 2000 (unaudited) and three months
                 ended March 31, 1999 (unaudited)

                 Notes to Consolidated Financial Statements              4


         Item 2. Management's Discussion and Analysis of Financial
                 Condition and Results of Operations                     4 - 12


PART II. OTHER INFORMATION

         Item 1. Legal Proceedings                                       13

         Item 2. Changes in Securities                                   13

         Item 3. Defaults upon Senior Securities                         13

         Item 4. Submission of Matters to Vote of Security Holders       13

         Item 5. Other Information                                       13

         Item 6. Exhibits and Reports                                    13

         Item 7. Signatures                                              14

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

<CAPTION>
<S>                                                                              <C>                <C>
PART I.   FINANCIAL INFORMATION
          Item 1. Financial Statements:

                                    ASSETS
                                                                                     March 31         December 31,
                                                                                      2000               1999
                                                                                    Unaudited           Audited
                                                                                    ---------           -------
Current assets:
   Cash and cash equivalents                                                      $   136,868        $   674,793
   Accounts receivable - trade                                                        654,204            157,040
   Accounts receivable - other                                                         50,987             63,677
   Inventories                                                                        226,666            361,039
   Other current assets                                                                76,075             50,185
                                                                                  -----------        -----------
      Total current assets                                                          1,144,800          1,306,734
                                                                                  -----------        -----------

Property and equipment, net                                                           394,289            260,543
Deferred income taxes                                                                 308,000            308,000
Intangible Assets, net of accumulated
 amortization of $975,000 in 2000 and
 $900,000 in 1999.                                                                    525,000            600,000
Other assets                                                                          131,865            133,776
                                                                                  -----------        -----------
      Total assets                                                                $ 2,503,954        $ 2,609,053
                                                                                  ===========        ===========


                      LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
   Loan Payable                                                                   $       -          $       -
   Accounts payable                                                                   315,263            215,409
   Accrued expenses                                                                    52,453            424,677
                                                                                  -----------        -----------
      Total current liabilities                                                       367,716            640,086
                                                                                  -----------        -----------

Commitments

Shareholders' equity -
   Common stock - .01 par value,
      45,000,000 shares authorized,
      17,569,951 and 17,286,278 issued
      17,444,151 and 17,160,478 outstanding
       in 2000 and 1999 respectively.                                                 175,700            172,862
   Additional paid-in capital                                                      12,707,275         12,556,205
   (Deficit)                                                                      (10,348,904)       (10,362,267)
                                                                                  -----------        -----------
                                                                                    2,534,071          2,366,800
   Common stock held in treasury,
    at cost                                                                          (397,833)          (397,833)
                                                                                  -----------        -----------
   Total shareholders' equity                                                       2,136,238          1,968,967
                                                                                  -----------        -----------
   Total liabilities and shareholders'
    equity                                                                        $ 2,503,954        $ 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>
                                                             Three Months Ended March 31,
                                                             ---------------------------

                                                                  2000           1999
                                                                  ----           ----
<S>                                                          <C>             <C>
 NET SALES                                                    $1,443,482      $ 767,859
                                                              ----------      ---------



Operating costs and expenses:

      Cost of sales                                              572,042        248,399
      Research and development                                   255,707        317,599
      Selling, general
          and administrative                                     605,266        561,574
                                                              ----------      ---------

                                                               1,433,015      1,127,572
                                                              ----------      ---------

Operating Income/Loss                                             10,467       (359,713)

Other income/expenses:
   Interest income                                                 2,898         (3,091)
                                                              ----------      ---------


Net Income/Loss                                               $   13,365      $(362,804)
                                                              ==========      =========



Net Income / (Loss) per common share
  basic and diluted                                           $     0.00      $   (0.02)
                                                              ==========      =========



</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):


                                                              Three Months Ended March 31
                                                                  2000          1999
                                                                  ----          ----
<S>                                                           <C>           <C>
Cash flows from operating activities:
   Net Income (loss)                                           $ 13,365      $(362,804)
                                                               --------      ---------

Adjustments to reconcile net (loss) to
 net cash  provided by (used for)
 operating activities:
   Depreciation                                                  24,509         21,984
   Amortization of capitalized software                          76,910         34,749
   Amortization of Intangible assets                                            75,000
Changes in operating assets and liabilities:
   (Increase) decrease in:
    Accounts receivable                                        (497,164)      (311,635)
    Other receivable                                             12,689        474,825
    Inventories                                                 134,373         23,172
    Other current assets                                        (25,890)        16,635
    Other assets                                                               (98,089)
   Increase (decrease) in:
     Accounts Payable and                                             -              -
        accrued expenses                                       (272,368)      (239,877)
                                                               --------      ---------

Total adjustments                                              (546,940)        (3,236)
                                                               --------      ---------

 Net cash provided by (used for)
  operating activities                                         (533,576)      (366,040)
                                                               --------      ---------

Cash flows from investing activities:

 Purchase of property and equipment - net                      (158,256)       (10,146)
                                                               --------      ---------

   Net cash (used) in investing activities                     (158,256)       (10,146)
                                                               --------      ---------

Cash flows from financing activities:                                                -
 Increase (decrease) in
  Loan Payable                                                                 153,801
 Issuance of common stock                                       153,907        250,000
                                                               --------      ---------

   Net cash provided
    by financing activities                                     153,907        403,801
                                                               --------      ---------

Net increase (decrease) in
 cash and cash equivalents                                     (537,925)        27,615

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

Cash and cash equivalents -
 end of period                                                 $136,868      $  59,864
                                                               ========      =========


</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 period.
        Common equivalent shares, including warrants and stock options, are
        included in the calculation of diluted earnings per common and common
        equivalent shares to the extent that they are dilutive and excluded
        to the extent they are anti-dilutive.


Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND
        RESULTS OF OPERATIONS FOR THREE MONTHS ENDED MARCH 31, 2000 AND FOR
        THE THREE MONTHS ENDED MARCH 31, 1999.

        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.
-4-
<PAGE>

        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 with Bellcore-level
        reliability.

        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.

        The SciDyn system features a modular architecture that permits our
        customers to add new product and service features without extensive
        product 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.
-5-
<PAGE>

        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.  This compact gateway offering provides up to 240 lines in
        half the space of its closest competitor.

        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.

        The first quarter of 2000 has been an exciting one for SciDyn.
        Following the success of the launch of our new IntegratorC-2308 at
        the VON show (Voice on the Net) in San Jose in March we have
        successfully shipped our first C-2308 Integrators for the new IP
        Telephony network.  In addition, we are currently expanding our
        distribution network for IP telephony working with Information
        Technology Services (ITS) a UK based distributor of networking
        equipment.  ITS's customer list includes Vodaphone, EuroBell,
        National Westminster Bank and British Broadcasting Corporation
        (BBC).  Initial feedback has proven positive.

        Our supply agreement with our IP Telephony client has moved forward
        with the insertion of Hewlett Packard as prime procurer of SciDyn's
        product line for the next generation IP Telephony network.  This
        provides SciDyn with a further distribution arrangement giving
        SciDyn access to HP's worldwide network of service and provisioning,
        giving our customer base a strong support network.  In addition to
        the distribution arrangement HP is currently on site in our
        Cherry Hill facility supervising and maintaining the IP test lab,
        providing continual support in the development of new applications.

        Recent work in Hong Kong has opened possibilities 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.
        With the launch and first shipments of our new product range we have
        been able to promote SciDyn in a far more aggressive manner producing
        a great deal of initial interest.

        Over the next eight months, SciDyn plans to introduce several new
        models into the IntegratorC-2000 gateway family. These 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.

        An ongoing activity is the development of new capabilities and
        technology for the IntegratorC-2000 platform. Some of the currently
        scheduled development efforts include simple network management
        protocol (SNMP) monitoring and configuration, speech recognition,
        text to speech capabilities, and dynamic application deployment
        technology.

-6-
<PAGE>

        Video over Frame Relay

        In 1997 SciDyn launched a 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 markets such as Brazil where SciDyn has
        shipped in excess of a hundred units over the past year.

        Canada's Provincial Government of the Northwest Territories (GNWT)
        signed a contract with Lucent to supply video conferencing via their
        data network over an 18-month period. SciDyn collaborated with Lucent
        Technologies to supply our VFX-250 products in 1999.

        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 anticipate possible business opportunities in the
        latter part of 2000.

        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.

        By selling via the network suppliers, such as Lucent, SciDyn is able
        to serve a far broader customer base and reach additional markets
        that would not have been addressable.

        The first quarter sales of the VFX-250S have been slow moving. 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 strong sales. With some expected further development of the
        VFX family and some investment in the promotion of the product line
        we anticipate an overall increase in sales over the next twelve
        months.

        In order to maximize our market potential, it is planned to have a
        combined frame-relay and ISDN interface developed into the product
        before the end of the year.

        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.

-7-
<PAGE>
        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 company has
        configured and installed several 432 line Commander ITCS during 1998.

        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 during the next 12 months. During this year,
        the Company will be exploring business opportunities with the major
        telephone companies in providing the Commander II inmate phone
        control system with call transaction (price per call) programs.


        Error Correction Algorithm

        The Company completed the acquisition of 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.

        We believe the Error Detection and Correction (EDAC) patented
        algorithm is superior to the presently used Reed-Soloman System,
        both in cost and capability.  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.

        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.
-8-
<PAGE>

        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.

        Forward Error Correction Algorithm Target Markets:

        The requirement for highly reliable, low-overhead, and low-cost
        Forward Error Correction devices is large. This new FEC algorithm
        will have increased importance in the emerging 3rd generation
        wireless market as larger packets of information are sent over the
        networks; lower FEC overheads will be a requirement of this future
        market. This will also hold true for the future development of
        packet-based technology. The following markets are potential users of
        this new technology:

          * Wireless handset and wireless network manufacturers, OEM
          * Cable modem manufacturers, OEM
          * LAN and WAN product manufacturers, OEM
          * Digital communication original equipment manufacturers, OEM


        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 our next general telco client
        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. SciDyn currently has two
        efforts already underway. We are working with Cisco to provide
        advanced voice applications and with Oracle to create unified
        messaging. In addition, efforts to create services with Belle Systems
        and ComPro are under investigation.

        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.

-9-
<PAGE>

        IntegratorC-2000(r) Gateway Future Development

        Future SciDyn development strategies will involve the exploration of
        new Internet data and telephony standards. SciDyn is positioning
        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.  Such a standard
        will open the door for other vendors to develop applications that
        can reside within a BubbleLINK 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 is working with a telecom
        hardware vendor on the integration and deployment of a high-density
        DS3 network interface card. SciDyn will also be breaking ground in
        the creation of new Internet-based service offerings such as Online
        Call Forwarding, Reverse dial tone, and Dynamic Network Adaptation.


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

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

        Three Months ended March 31, 2000 compared to the Three Months ended
        March 31, 1999 (unaudited).

                                                    Nine Months Ended
                                                         March 31,
                                                   2000            1999
                                                   ----            ----
           Sales                              $ 1,443,482      $  767,859
           Net Income / (Loss)                     13,365        (362,804)
           Net Income / (Loss) Per Share           $ 0.00          $(0.02)


                                    OPERATING EXPENSES       PERCENT OF SALES

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

          Cost of Goods Sold     $  572,042  $  248,399        39.6%    32.4%

          Research & Development    255,707     317,599        17.8%    41.4%

          Sales, General & Admin    605,266     561,574        41.9%    73.2%

          Total Operating Costs
          and Expenses           $1,433,015  $1,127,572        99.3%   147.0%

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        Sales for the three-month period of 2000 were $1,443,482 an increase
        of 675,623 from sales of $767,859 in the corresponding period in 1999.
        This increase was directly attributable to the shipments of our first
        C-2308 Integrators for the new IP Telephony network.  Service and
        maintenance sales currently make up a small percentage of our net
        revenue.  We have revamped our service and maintenance department and
        we expect the proportion of service and maintenance revenue to
        increase in the future.  As we continue to initiate further
        distribution arrangements we expect to derive an increasing amount of
        our revenue from the sale of our products through distribution
        channels. Revenue derived from indirect sales typically carries a
        lower gross margin than direct sales. As a result, we expect future
        fluctuations on our total gross margin in the future.  The business
        focus has continued undaunted and we believe our strategic
        implementation plan will launch the Company into achieving
        significant sales revenue in the upcoming quarters and succeeding
        years.

        Cost of Goods sold increased to $572,042 in the first three months
        of 2000 from $248,399 in the corresponding three-month period of
        1999.  The increase in the cost of goods sold was directly related
        to the increase in sales revenue.

        Research & Development expenses decreased to $255,707 in the
        first three months of 2000 as compared to $317,599 in the comparable
        three-month period of 1999.  The decrease in research and development
        expenses during the first three months of 2000 is a combined result
        of a decrease in engineering consulting services, decreased travel
        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 are currently working on expanding our
        engineering team and intend to continue to make, significant
        investments in research and development.

        Sales, General & Administrative expenses increased to $605,266 in
        the first three months of 2000, compared to $561,574 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. The major
        directive is to initiate and promote a full-scale sales and marketing
        program to bring the company above the radar screen to promote
        awareness and recognition of SciDyn in the marketplace.  We expect
        to incur substantial expenditures related to sales and marketing
        activities, the recruitment of additional sales and marketing
        personnel and the expansion of our domestic and international
        distribution channels.


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

        Cash and cash equivalents increased to $136,868 for the period ended
        March 31, 2000 from $674,793 at December 31, 1999.  Trade accounts
        receivable increased to $654,204 for the period ended March 31, 2000
        compared to $157,040 at December 31, 1999.  Net cash used for
        operating activities was $533,576 during the three-month period
        ended March 31, 2000 compared to $366,040 in the corresponding period
        of 1999.  Net cash used for operating activities primarily reflects
        the increase in accounts receivable, and a decrease in inventory,
        accounts payable and accrued expenses.

        Cash used in investing activities was $158,256 for the three-month
        period ended March 31, 2000 compared to $10,146 in the corresponding
        period of 1999.  The outlay reflects the continual investment in
        computer related equipment to further development efforts.

        Cash provided by financing activities in the three-month period
        ended March 31, 2000, amounted to $153,907, raised through the
        issuance on Common Stock pursuant to the Company's employee stock
        option plan.

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<PAGE>
        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.  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
        positions.

        Forward Looking and Cautionary Statements

        Except for the historical information and discussions contained
        herein, statements contained in this Form 10-QSB may constitute
        "forward looking statements" within the meaning of the Private
        Securities Litigation Reform Act of 1995. These statements involve a
        number of risks, uncertainties and other factors that could cause
        actual results to differ materially, including the company's failure
        to continue to develop and market new and innovative products and
        services and to keep pace with technological change; competitive
        pressures; failure to obtain or protect intellectual property rights;
        issues on the company's business, financial condition or results of
        operations; quarterly fluctuations in revenues and volatility of
        stock prices; the company's ability to attract and retain key
        personnel; currency and customer financing risks; dependence on
        certain suppliers; changes in the financial or business condition of
        the company's distributors or resellers; the company's ability to
        successfully manage acquisitions and alliances; legal, political and
        economic changes and other risks, uncertainties and factors discussed
        elsewhere in this Form 10-QSB, in the company's other filings with
        the Securities and Exchange Commission or in materials incorporated
        therein by reference.

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<PAGE>


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) Exhibit 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.

SCIENCE DYNAMICS CORPORATION

In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on
the date indicated.


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

By:   /s/ Joy C. Hartman       CEO/President                May 15, 2000
      ---------------------    Principal Financial Officer  ------------
      Joy C. Hartman

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