CONFORMED COPY FORM 10-QSB SECURITIES AND
EXCHANGE COMMISSION
WASHINGTON, D.C. 20549 Quarterly Report Under Section 13 or 15 (d)
of the Securities Exchange Act of 1934 For the Quarter Ended
March 31,  2001           Commission File No. 0-9996  DOTRONIX, INC.(Exact name of registrant as specified in
its charter) Minnesota
  41-1387074(State or other jurisdiction of
  (I.R.S. Employerincorporation or organization)
  Identification No.)
  Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by section 13 or 15 (d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.  YESxNOo   Indicate
the number of shares outstanding of each of the issuers classes of common
stock as of the latest practicable date.  Class
  Outstanding at May  10, 2001Common stock, par value
  4,165,041 shares$.05 per share
   DOTRONIX,
INC.
INDEX



Part
  I - Financial InformationItem
  1.  Financial Statements (Unaudited)Balance SheetsStatements of OperationsStatements of Cash FlowsNotes to Financial
  StatementsItem
  2.  Managements Discussion and
  Analysis of Financial Condition and Results of OperationsPart
  II - Other InformationItem 1.  Exhibits and Reports on Form 8-K



PART
I.  FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS

BALANCE SHEETSDOTRONIX, INC.
(UNAUDITED)

March 31
  June 30ASSETS
  2001
  2000Cash
  and cash equivalents
  $99,547
  $75,466Accounts
  receivable, less allowance for doubtful accounts of $25,000 and $28,893 respectively
  464,175
  1,261,012Inventories:Raw materials
  1,250,568
  1,255,966Work-in-process
  355,378
  515,948Finished goods
  273,550
  277,049Total inventories
  1,879,496
  2,048,963Prepaid
  expenses
  70,996
  47,359Total
  current assets
  2,514,214
  3,432,800PROPERTY,
  PLANT & EQUIPMENTat cost net of accumulated depreciation of
  $5,934,962and
  $5,733,941  respectively
  989,114
  1,158,422OTHER
  ASSETS:Excess
  of cost over fair value of net assets acquired, less amortization of $1,007,968 and $881,972,
  respectively
  431,986
  485,984License
  agreement,  net
  3,750
  15,000Other
  400
  400TOTAL
  ASSETS
  $3,939,464
  $5,092,606LIABILITIES
  AND STOCKHOLDERS EQUITYCURRENT
  LIABILITIES:Revolving
  loans
  $166,122
  $453,328Current
  maturities-capital lease obligations
  -
  33,256Accounts
  payable
  314,142
  725,404Salaries,
  wages and payroll taxes
  107,330
  214,264Current
  portion-deferred gain on sale of building
  47,613
  47,613Other
  accrued liabilities
  89,429
  172,106Total
  current liabilities
  724,636
  1,645,971DEFERRED
  GAIN ON SALE OF BUILDING
  337,259
  372,968STOCKHOLDERS'
  EQUITY:Common
  stock, $.05 par value
  208,252
  203,737Additional
  paid-in capital
  10,913,426
  10,883,778Unearned
  compensation
  (4,750)
  (9,125)Accumulated
  deficit
  (8,239,359)
  (8,004,723)Total
  stockholders' equity
  2,877,569
  3,073,667TOTAL
  LIABILITIES AND STOCKHOLDERS' EQUITY
  $3,939,464
  $5,092,606

See
notes to financial statements.

STATEMENTS
OF OPERATIONSDOTRONIX, INC.
(UNAUDITED)

Three months ended,
  Nine months ended,March 31
  March  312001
  2000
  2001
  2000REVENUES
  $1,181,165
  $1,263,742
  $5,178,599
  $5,615,586OPERATING
  EXPENSES:Cost of sales
  900,750
  954,948
  3,515,472
  4,111,250Selling, general and administrative
  650,014
  879,777
  1,806,469
  2,511,147Interest
  25,684
  29,094
  91,294
  95,448Net
  (loss)
  $(395,283)
  $(600,077)
  $(234,636)
  $(1,102,259)Basic and diluted net loss per
  common share
  ($0.09)
  ($0.15)
  ($0.06)
  ($0.27)Average number of common shares
  outstanding
  4,165,041
  4,072,732
  4,129,445
  4,067,752

See
notes to financial statements.

STATEMENTS OF CASH FLOWSDOTRONIX,
INC
(UNAUDITED)



Nine months endedMarch 312001
  2000CASH
  FLOWS FROM OPERATING ACTIVITIES:Net loss
  $(234,636)
  $(1,102,259)Adjustment to reconcile net  loss to net cashused in
  operating activities:Writedown for inventory obsolescence
  150,582
  90,000Depreciation and amortization
  266,269
  235,390Stock compensation
  38,538
  31,865Amortization of deferred gain on sale
  of building
  (35,709)
  (35,710)Change in assets and liabilities:Accounts receivable
  796,837
  455,052Inventories
  18,885
  (44,196)Prepaid expenses
  (23,637)
  (33,130)Other assets
  -
  3,087Accounts payable and accrued
  liabilities
  (600,873)
  24,921NET
  CASH  PROVIDED BY (USED IN)  OPERATING ACTIVITIES
  376,256
  (374,980)CASH
  FLOWS FROM INVESTING ACTIVITIES:Purchase of property, plant and equipment
  (31,713)
  (54,670)NET
  CASH USED IN INVESTING ACTIVITIES
  (31,713)
  (54,670)CASH
  FLOWS FROM FINANCING ACTIVITIES:Borrowings on revolving loan
  5,709,000
  5,816,567Repayments on revolving loan
  (5,996,206)
  (5,812,939)Payments of capital lease obligations
  (33,256)
  (95,711)NET
  CASH  (USED IN)  FINANCING ACTIVITIES
  (320,462)
  (92,083)NET
  INCREASE (DECREASE) IN CASHAND CASH EQUIVALENTS
  24,081
  (521,733)CASH
  AND CASH EQUIVALENTS AT   BEGINNING OF
  THE PERIOD
  75,466
  621,414CASH
  AND CASH EQUIVALENTS AT END OF THE PERIOD
  $99,547
  $99,681



See
notes to financial statements.

DOTRONIX, INC.NOTES TO FINANCIAL STATEMENTS



A.         Basis
of Presentation

The balance sheet as of March 31, 2001,
the statements of operations for the three and nine month periods ended March
31, 2001 and 2000 and the statements of cash flows for the nine month periods
ended March 31, 2001 and 2000 have been prepared by the Company without
audit.  In the opinion of management,
all adjustments (consisting only of normal recurring accruals) necessary to
present fairly the financial position, results of operations and cash flows at
March 31, 2001 and for the three and nine months periods ended March 31, 2001
and 2000 presented herein have been made.

Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or
omitted.  It is suggested that these
financial statements be read in conjunction with the Companys financial
statements and notes thereto included in the Annual Report on Form 10-KSB of
the Company for the fiscal year ended June 30, 2000.

B.          Revolving
Line of  Credit

On February 23, 2000, the Company entered
into a revolving credit facility with its president and major stockholder, and
in September 2000 the Companys president and major stockholder agreed to
extend the loan agreement to February 28, 2002, and to increase the loan limit
to $1,250,000 in secured financing. The revolving credit facility contains
various restrictive covenants including a minimum tangible net worth balance of
$2.0 million. As of May 10, 2001 the Company had $920,000  available under the  revolving credit facility. Interest on
outstanding borrowings under the revolving credit facility is accrued at the
Wells Fargo Bank prime interest rate plus 3%. Additionally, the Company is
required to issue warrants on the Companys stock to the president and major
shareholder for incremental increases in the outstanding borrowings
balance.  One warrant is issued for
every $4 in incremental borrowings made by the Company.  All warrants issued expire in 4 years and
have an exercise price equal to the fair market value of the Companys stock at
the date of grant. Once repayments on the facility have been made, additional
warrants are issued for incremental borrowings on the facility only to the
extent that the new outstanding borrowings balance exceeds the previous high
outstanding borrowings balance. The Company recorded interest expense of
$43,000 for the nine months ended March 31, 2001  related to the warrants.

ITEM2.
MANAGEMENTS DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

Revenue decreased by $83,000, or 7%, for
the three months ended March 31, 2001, and decreased $437,000, or 8%,  for the nine months ending March 31, 2001,
compared to like periods in the prior year. In March 2000 the Company
implemented a strategy to improve its gross margins on certain mature
monochrome products. The Company 
informed several of its customers that it was  unwilling to accept low volume orders and it intended to
discontinue maintenance of manufacturing capacity for several monochrome
products if order  size did not increase.
The increased orders which resulted from this strategy were completed by the
end of December 31, 2000. In addition, offshore competition for large  screen color products has increased
substantially.  Results for the nine
months ended March 31, 2001 reflect an increase in sales of certain mature
monochrome products for six months followed by a decline in sales for these
products for the three months ended March 31, 2001, combined with fewer and
smaller orders for large screen color products.

The gross margin percentage for the
quarter ended March 31, 2001, was 24%, the same as the quarter ended  March 
31, 2000. The gross margin percentage for the nine months ended March
31, 2001, was 32%, compared to 27%, for the nine months ended March 31, 2000.
Increased order size on certain mature monochrome products, and cost reduction
efforts, contributed to the gross margin increase for  the nine month period ended March 31, 2001, compared to the same
period in the prior year.

Selling, general, and administrative expenses
decreased $230,000, or 26%, for the quarter ended March 31, 2001, and $705,000,
or 28%, for the nine months ended March 31, 2001, when compared to the same
periods in the prior year. The decrease was due to significant expense
reduction efforts, primarily in employment levels and in the reduction of
medical benefit costs resulting from a switch from self insuring employee
medical benefits  to fully insuring
employee medical benefits.

Interest expense decreased $3,000, or
12%, during the quarter ended March 31, 2001, and $4,000, or 4%, for the nine
months ended March 31, 2001, compared to the same periods of the prior year.

LIQUIDITY AND CAPITAL
RESOURCES

On February 23, 2000, the Company entered
into a revolving credit facility with its president and major stockholder, and
in September 2000 the Companys president and major stockholder agreed to
extend the loan agreement to February 28, 2002, and to increase the loan limit
to $1,250,000 in secured financing. The revolving credit facility contains various
restrictive covenants including a minimum tangible net worth balance of $2.0
million. As of May 10, 2001 the Company had $920,000available under the revolving credit facility.
Interest on outstanding borrowings under the revolving credit facility is accrued
at the Wells Fargo Bank prime interest rate plus 3%.

Company management believes that the cash
and cash equivalents on hand at May 10, 2001 and future amounts available under
the aforementioned credit agreement should be adequate to meet cash requirements
for the next quarter.  After that it may
be necessary to increase revenues, decrease costs, or secure other sources of
cash through sale of assets or other methods of financing the Company.  There is no assurance that any of these
steps will be successful.

During the nine months ended March 31,
2001, cash flow from operating activities was $376,000. Major contributors to
cash provided by operating activities included non-cash expense items totaling
$417,000, partially offset by an net loss of $234,000, and proceeds from
payments of accounts receivables, which provided $196,000 of operating cash
flow, net of  expenditures of payments
of trade payables.

During the same period $32,000 of cash
was used in the purchase of property, plant, and equipment. Payment of capital
lease obligations used $33,000 of cash. 
A decrease in borrowings on the working capital loan used  $287,000 of Company cash.  The overall result was an increase in cash
of $24,000.

COMMON STOCK LISTING

The Companys Common Stock previously was
quoted on the NASDAQ Stock Market under the symbol DOTX.  Effective August 4, 1999 the Companys
Common Stock transferred to the OTC Bulletin Board.

PART II - OTHER
INFORMATION

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

At the annual meeting of the shareholders
of the Company held on December 28, 2000 the following items were voted on:

Election of DirectorsVotes For
  WithheldWilliam
  S. Sadler
  3,838,981
  93,935Ray
  L. Bergeson
  3,845,081
  87,835Edward
  L. Zeman
  3,845,081
  87,835L.
  Daniel Kuechenmeister
  3,845,081
  87,835Confirmation of Outside
  Auditors
  Votes For
  Against
  AbstainDeloitte
  & Touche LLP
  3,889,141
  11,700
  22,075

Item
6.  Exhibits and reports on Form 8-K

No
reports on Form 8-K were issued during the quarter.



SIGNATURES

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

Date:  May 10, 2001
  Dotronix,
  Inc.By   /s/ William S. SadlerWilliam S. SadlerPresident(Principal Executive Officer)By   /s/ Robert V. KlingRobert V. KlingChief Financial Officer(Principal Financialand accounting Officer)