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  June 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:


         08/14/2000    17,783,716 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 June 30, 2000        1
                 (unaudited) and December 31, 1999 (audited)

                 Consolidated Statements of Income (loss) for the       2
                 six months and three months ended June 30, 2000
                 (unaudited) and the six and three months ended
                 June 30, 1999 (unaudited)

                 Consolidated Statements of Cash Flows for six months   3
                 and Three months ended June 30, 2000 (unaudited) and
                 for the six and three months ended June 30, 1999
                 (unaudited)

                 Notes to Consolidated Financial Statements             4

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

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>

PART I.   FINANCIAL INFORMATION
          Item 1. Financial Statements:

                                     ASSETS
<S>                                                                              <C>                <C>
                                                                                    June 30,         December 31,
                                                                                      2000               1999
                                                                                    Unaudited          Audited
                                                                                    ---------          -------
Current assets:
   Cash and cash equivalents                                                      $ 1,130,534        $   674,793
   Accounts receivable - trade                                                      1,570,817            157,040
   Accounts receivable - other                                                         61,715             63,677
   Inventories                                                                        392,575            361,039
   Other current assets                                                               129,250             50,185
                                                                                  -----------        -----------
      Total current assets                                                          3,284,891          1,306,734
                                                                                  -----------        -----------

Property and equipment, net                                                           506,047            260,543
Deferred income taxes                                                                 308,000            308,000
Intangible Assets, net of accumulated
 amortization of $1,050,000 in 2000 and
 $900,000 in 1999.                                                                    450,000            600,000
Other assets                                                                          129,955            133,776
                                                                                  -----------        -----------
      Total assets                                                                $ 4,678,893        $ 2,609,053
                                                                                  ===========        ===========


                      LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
   Accounts payable                                                                   566,610            215,409
   Accrued expenses                                                                    82,177            424,677
                                                                                  -----------        -----------
      Total current liabilities                                                       648,787            640,086
                                                                                  -----------        -----------

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)                                                                      (10,025,185)       (10,362,267)
                                                                                  -----------        -----------
                                                                                    4,427,939          2,366,800
   Common stock held in treasury,
    at cost                                                                          (397,833)          (397,833)
                                                                                  -----------        -----------
   Total shareholders' equity                                                       4,030,106          1,968,967
                                                                                  -----------        -----------
   Total liabilities and shareholders'
    equity                                                                        $ 4,678,893        $ 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>


                                                               Six Months Ended June 30,         Three Months Ended June 30,

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

<S>                                                          <C>             <C>                <C>               <C>
 NET SALES                                                    $3,547,753      $1,208,224        $2,104,271         $ 440,365
                                                              ----------      ----------        ----------         ---------


Operating costs and expenses:

      Cost of sales                                            1,284,270         433,948           712,227           185,549
      Research and development                                   526,534         615,773           270,826           298,174
      Selling, general
          and administrative                                   1,408,305       1,015,281           803,039           453,707
                                                              ----------      ----------        ----------         ---------

                                                               3,219,109       2,065,002         1,786,092           937,430
                                                              ----------      ----------        ----------         ---------

Operating income (loss)                                          328,644        (856,778)          318,179          (497,065)

Other (expenses):
   Interest income                                                 8,438             -               5,540               -
   Interest expense                                                  -            (6,905)              -              (3,814)
                                                              ----------      ----------        ----------         ---------


Net income (loss)                                             $  337,082      $ (863,683)       $  323,719         $(500,879)
                                                              ==========      ==========        ==========         =========



Net income per share-basic and diluted,
and net loss per common share                                 $     0.02      $    (0.05)       $     0.02         $   (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):


                                                              Six Months Ended June 30,
                                                                   2000           1999
                                                                   ----           ----

<S>                                                           <C>           <C>
Cash flows from operating activities:
   Net income (loss)                                           $  337,082      $(863,683)
                                                               ----------      ---------

Adjustments to reconcile net income (loss)
 to net cash (used for) provided by
 operating activities:
   Depreciation                                                    59,880         44,630
   Amortization of capitalized software                                 -         69,498
   Amortization of Intangible assets                              150,000        150,000
Changes in operating assets and liabilities:
   (Increase) decrease in:
    Accounts receivable                                        (1,413,777)       (61,520)
    Other receivable                                                1,962        458,801
    Inventories                                                   (31,536)        35,740
    Other current assets                                          (79,065)        32,045
    Other assets                                                    3,821        (96,179)
   Increase (decrease) in:
     Accounts Payable and                                               -              -
        accrued expenses                                            8,701       (363,040)
                                                               ----------      ---------

Total adjustments                                              (1,300,014)       269,975
                                                               ----------      ---------

 Net cash provided by (used for)
  operating activities                                           (962,932)      (593,708)
                                                               ----------      ---------

Cash flows from investing activities:

 Purchase of property and equipment - net                        (305,384)       (19,311)
                                                               ----------      ---------

   Net cash (used) in investing activities                       (305,384)       (19,311)
                                                               ----------      ---------

Cash flows from financing activities:
 Increase (decrease) in
  Loan Payable                                                                   143,224
 Issuance of common stock
 and warrants                                                   1,724,057        504,975
                                                               ----------      ---------

   Net cash (used in) provided
    by financing activities                                     1,724,057        648,199
                                                               ----------      ---------

Net increase (decrease) in
 cash and cash equivalents                                        455,741         35,180

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

Cash and cash equivalents -
 end of period                                                 $1,130,534      $  67,429
                                                               ==========      =========


</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 SIX MONTHS ENDED JUNE 30, 2000 AND FOR THE THREE
        MONTHS ENDED JUNE 30, 2000.

        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 half of 2000 has been an exciting time for SciDyn as we
        began to fulfill our first contract for our 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 $3,102,690 of the anticipated $13,000,000
        contract.  HP remains on site in our Cherry Hill facility supervising
        and maintaining the IP test lab,  providing continual support in the
        development of new applications.

        We are seeking partners to expand our distribution base and are
        pursuing prospects in Europe and South Africa. We continue to work
        in Hong Kong in  hopes of gaining access to distribution partners
        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 we have been
        able to promote SciDyn in a far more aggressive manner producing a
        great deal of initial interest.

        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 beginning of the fourth quarter, speech
        recognition, text to speech capabilities, and dynamic application
        deployment technology are scheduled for completion by the end of
        the year.

        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.

-6-
<PAGE>
        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.

        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.

        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
        strong 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, 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.

        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 during the next 9 months.

-7-
<PAGE>

        The Company has begun  exploring 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 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.

        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.  To date
        Scidyn has been unable to convince any 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. 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.

        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 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.

-9-
<PAGE>

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

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

        Six Months ended June 30, 2000 compared to the Six Months ended
        June 30, 1999 (unaudited).

                                                    Six Months Ended
                                                         June 30,
                                                   2000            1999
                                                   ----            ----
           Sales                              $ 3,547,753      $1,208,224
           Net Income / (Loss)                    337,082        (863,683)
           Net Income / (Loss) Per Share           $ 0.02          $(0.05)


                                    OPERATING EXPENSES       PERCENT OF SALES

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

          Cost of Goods Sold     $1,284,270  $  433,948         36%      36%

          Research & Development    526,534     615,773         15%      51%

          Sales, General & Admin  1,408,305   1,015,281         40%      84%

          Total Operating Costs
          and Expenses           $3,219,109  $2,065,002         91%     171%


        Sales for the six-month period of 2000 were $3,547,753 an increase of
        2,339,529 from sales of $1,208,224 in the corresponding period in
        1999. This increase was directly attributable to the shipments of
        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.

        Cost of Goods sold increased to $1,284,270 in the first six months
        of 2000 from $433,948 in the corresponding six-month period of 1999.
        The increase in the cost of goods sold was directly related to the
        increase in sales revenue.

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<PAGE>
        Research & Development expenses decreased to $526,534 in the first
        six months of 2000 as compared to $615,773 in the comparable
        six-month period of 1999.  The decrease in research and development
        expenses during the first six months of 2000 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 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 $1,408,305 in
        the first six months of 2000, compared to $1,015,281 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 and the addition of
        administrative staff.  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.


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

                                                    Three Months Ended
                                                         June 30,
                                                   2000            1999
                                                   ----            ----
           Sales                              $ 2,104,271      $  440,365
           Net Income / (Loss)                    323,719        (500,879)
           Net Income / (Loss) Per Share           $ 0.02          $(0.03)


                                    OPERATING EXPENSES       PERCENT OF SALES

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

          Cost of Goods Sold     $  712,227  $  185,549         34%      42%

          Research & Development    270,826     298,174         13%      68%

          Sales, General & Admin    803,039     453,707         38%     103%

          Total Operating Costs
          and Expenses           $1,786,092  $  937,430         85%     213%

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<PAGE>


        Sales for the three-month period of 2000 were $2,104,271 an increase
        of 1,663,906 from sales of $440,365 in the corresponding period in
        1999. This increase was directly attributable to the shipments of
        C-2308 Integrators to Cascadent Communications for their  new IP
        Telephony network.  Service and maintenance sales continue to 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.

        Cost of Goods sold in the three months ended June 30, 2000 was
        $712,227 as compared to $185,549 in the corresponding period of 1999.
        The increase is directly attributable to the increase in sales during
        the second quarter of 2000.

        Research & Development expenses decreased from $298,174 in the second
        quarter of 1999 to $270,826 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.
        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 $349,332 in 2000
        over the corresponding quarter in 1999. This increase is attributable
        to the use of a marketing firm during the second quarter along with
        increased presence at trade shows and new administrative hires
        during the quarter.


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

        Cash and cash equivalents increased to $1,130,534 for the period
        ended June 30, 2000 from $674,793 at December 31, 1999.  Net cash
        used for operating activities was $962,932 for the six month period
        ended June 30, 2000 compared to $593,708 cash used for operating
        activities in the six month period ended June 30, 1999.

        Net cash used in investing activities was $305,384 during the
        six-month period of 2000 compared to $19,311 in the corresponding
        six-month period of 1999.

        Net cash provided by financing activities was $1,724,057 for the
        six-month period ended June 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.

        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.

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<PAGE>
        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 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.



PART II.OTHER INFORMATION

SCIENCE DYNAMICS CORPORATION AND SUBSIDIARIES
_____________________________________________

Item 1. Legal Proceedings

        No material developments.

Item 2. Changes in Securities

        During the three months ended June 30, 2000 the Company sold 200,650
        shares of unregistered common stock to 8 accredited investors, as
        defined by Rule 501(a) of Regulation D of the Securities Act of 1933,
        as amended. The net proceeds from the sale were  $1,570,149, which
        are being used to meet the working capital needs of the Company.
        The shares were subsequently registered on August 10, 2000.

Item 3. Defaults Upon Senior Securities

        None.

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

        None.

Item 5. Other Information

        On June 7, 2000 the Company announced the elevation of
        Alan C. Bashforth to chairman of the company's Board of Directors.
        Bashforth replaced Lyndon A. Keele, who has retired.

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/ Robert O'Connor      Vice President and           August 14, 2000
      ---------------------    Financial Officer            ---------------
      Robert O'Connor

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