<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D. C. 20549

                                    Form 10-Q

                QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934


  For the Quarter ended
      March 31, 2002                           Commission File Number 2-71865
  ---------------------                        ------------------------------

                       TEXLAND DRILLING PROGRAM-1981, LTD.
                       -----------------------------------
                              (Name of Registrant)

          TEXAS                                         75-1791491
 -----------------------                    ------------------------------------
 (State of Organization)                    (I.R.S. Employer Identification No.)


  777 Main Street, Suite 3200
       Fort Worth, Texas                                  76102
------------------------------                          --------
(Address of Executive Offices)                          Zip Code

                  Registrant's Telephone Number (817) 336-2751
                                                --------------

           Securities registered pursuant to Section 12(b) of the Act:

Units of Limited Partnership Interest                     None
-------------------------------------                --------------
           (Title of Class)                          (Voting Units)


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.
       YES  X   NO
           ---     ---


                    This report contains a total of 10 pages.

                                       1

<PAGE>

                       Texland Drilling Program-1981, Ltd.

                          Index To Financial Statements


                                 Reference Page
                                 --------------

Balance Sheets at March 31, 2002 and
    December 31, 2001.                                                 3

Statements of Operations for the Three Months
    Months Ended March 31, 2002 and 2001.                              4

Statement of Partners' Capital at March 31, 2002.                      5

Statements of Cash Flows for Three Months Ended
    March 31, 2002 and 2001.                                           6

Notes to Financial Statements.                                       7-8


                                       2

<PAGE>

                       Texland Drilling Program-1981, Ltd.
                             (A Limited Partnership)

                                 Balance Sheets
                      March 31, 2002 and December 31, 2001
                                   (Unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>

                                                               03/31/02      12/31/2001
                                                             ------------   ------------
ASSETS
<S>                                                          <C>            <C>
Current Assets
Cash                                                         $     37,378   $      2,599
Accounts receivable - trade (Note 6)                              105,928         91,976
Accounts receivable - managing general partner                     18,844         18,844
                                                             ------------   ------------
                                                                  162,150        113,419
                                                             ------------   ------------
Property and Equipment, at Cost (Successful
  Efforts Method) (Notes 2, 3, 4, and 5)
Intangible development costs                                    7,249,620      7,244,553
Lease and well equipment                                        4,196,618      4,202,099
Producing leaseholds                                              161,495        161,495
                                                             ------------   ------------
                                                               11,607,733     11,608,147
Accumulated depreciation, depletion and amortization          (10,300,908)   (10,264,228)
                                                             ------------   ------------
                                                                1,306,825      1,343,919
                                                             ------------   ------------

                                                             $  1,468,975   $  1,457,338
                                                             ============   ============
LIABILITIES AND PARTNERS' CAPITAL
Current Liabilities
Accounts payable:
  Managing general partner (Note 5)                          $     51,926   $     55,102
                                                             ------------   ------------

Partners' Capital (Notes 4 and 7)
Limited partners - 2,425 units outstanding                      1,261,685      1,241,922
General partners                                                  155,364        160,314
                                                             ------------   ------------
                                                                1,417,049      1,402,236
                                                             ------------   ------------

                                                             $  1,468,975   $  1,457,338
                                                             ============   ============
</TABLE>
--------------------------------------------------------------------------------
                 See accompanying notes to financial statments.

                                        3

<PAGE>

                      Texland Drilling Program-1981, Ltd.
                            (A Limited Partnership)

                            Statements of Operations
                             March 31, 2002 and 2001
                                  (Unaudited)
--------------------------------------------------------------------------------

                                                         Three Months Ended
                                                              March 31,
                                                         2002          2001
                                                      ----------    ---------
Revenue
Oil and gas sales (Note 6)                            $ 244,134     $ 450,662
Interest income                                              42           532
Miscellaneous Income                                          -             -
Gain on sale of assets                                    6,926             -
                                                      ---------     ---------
                                                        251,102       451,194
                                                      ---------     ---------
Expense (Note 5)
Fees to managing general partner                         23,250        21,975
Production expense                                      119,174       105,848
Severance tax                                            12,634        25,870
Depreciation, depletion and amortization                 43,606        31,753
Other                                                     1,044           476
                                                      ---------     ---------
                                                        199,708       185,922
                                                      ---------     ---------

Net Income (Loss)                                     $  51,394     $ 265,272
                                                      =========     =========
Allocation of Net Income (Loss)  (Note 7)
Limited partners                                      $  19,763     $ 135,289
General partners                                         31,631       129,983
                                                      ---------     ---------

                                                      $  51,394     $ 265,272
                                                      =========     =========
Net Income (Loss) per $5,000 Limited
  Partner (2,425 Units Outstanding)                   $       8     $      56
                                                      =========     =========



--------------------------------------------------------------------------------
                See accompanying notes to financial statements.

                                        4

<PAGE>

                      Texland Drilling Program-1981, Ltd.
                            (A Limited Partnership)

                         Statements of Partners' Capital
                       Three Months Ended March 31, 2002
                                  (Unaudited)
--------------------------------------------------------------------------------


                                              Limited    General
                                             Partners   Partners      Total
                                           -----------  ---------  -----------

Balance at December 31, 2001               $ 1,241,922  $ 160,314  $ 1,402,236
Partners' distributions                              -    (31,100)     (31,100)
Partners' contributions                              -     (5,481)      (5,481)
Net income                                      19,763     31,631       51,394
                                           -----------  ---------  -----------

Balance at March 31, 2002                  $ 1,261,685  $ 155,364  $ 1,417,049
                                           ===========  =========  ===========


--------------------------------------------------------------------------------
                See accompanying notes to financial statements.

                                        5

<PAGE>

                      Texland Drilling Program-1981, Ltd.
                            (A Limited Partnership)

                             Statements of Cash Flow
                   Three Months Ended March 31, 2002 and 2001
                                  (Unaudited)


                                                            2002         2001
                                                          --------    ---------
Operating Activities
Net income (loss)                                         $ 51,394    $ 265,272
                                                          --------    ---------
Adjustments to reconcile net income to net
  cash provided by operating activities:
    Depreciation, depletion and amortization                43,606       31,753
    Gain on sale of assets                                  (6,926)           -
    (Increase) decrease in accounts receivable             (13,952)     (64,431)
    (Decrease) increase in accounts payable                 (3,176)      34,795
    Other                                                        -            -
                                                          --------    ---------
                                                            19,552        2,117
                                                          --------    ---------
Net cash provided by operating activities                   70,946      267,389
                                                          --------    ---------

Investing Activities
Acquisition of property and equipment                       (6,512)     (53,136)
Proceeds from sale of assets                                 6,926            -
                                                          --------    ---------
Net cash used in investing activities                          414      (53,136)
                                                          --------    ---------

Financing Activities
Partners' contributions                                     (5,481)       8,333
Partners' distributions                                    (31,100)    (189,944)
                                                          --------    ---------
Net cash used in financing activities                      (36,581)    (181,611)
                                                          --------    ---------

Net Increase in Cash                                        34,779       32,642
Cash - beginning of year                                     2,599       58,887
                                                          --------    ---------

Cash - End of Quarter                                     $ 37,378    $  91,529
                                                          ========    =========

--------------------------------------------------------------------------------
                See accompanying notes to financial statements.

                                       6

<PAGE>
                      Texland Drilling Program-1981, Ltd.
                            (A Limited Partnership)

                         Notes To Financial Statements
                                 March 31, 2002
                                  (Unaudited)


1.   Summary Of Significant Accounting Policies

The Partnership was organized as a limited partnership on July 20, 1981 for the
purpose of engaging in oil and gas exploration and production. Texland
Properties-1981, a general partnership, and Texland Petroleum, Inc. are the
General Partners. The Managing General Partner is Texland Petroleum, Inc. The
Partnership's accounting policies are summarized below:

Basis Of Accounting

The Partnership follows generally accepted accounting principles applicable to
established enterprises in the extractive industries under a method which is
generally known as the successful method of accounting.

Property And Equipment

Costs incurred for the acquisition of producing and nonproducing leaseholds are
capitalized. Costs of intangible development and lease and well equipment
incurred to drill and equip successful exploratory and development wells are
capitalized. Costs to drill and equip unsuccessful exploratory wells are charged
to operations while costs of unsuccessful development wells remain capitalized.
Costs associated with uncompleted wells are capitalized as wells-in-progress.

Abandoned Leaseholds

Costs of nonproducing properties are charged to expense at such time as they are
deemed to be impaired, based upon periodic assessments of such costs.

Depletion

Leasehold costs of producing properties are amortized on the unit of production
method based on proved oil and gas reserves. Intangible development costs of
producing properties are amortized on the unit of production method based on
estimated proved developed oil and gas reserves.

Depreciation

Depreciation of equipment is provided by using the unit of production method
based on estimated proved developed oil and gas reserves.

Organization Costs

These costs are amortized by the straight-line method over ten years, the life
of the Partnership.

Federal Income Tax

The Partnership files its federal income tax return on the accrual basis.

2.   Contributions By General Partner (Texland Properties-1981)

Under terms of the Partnership Agreement, the General Partner is charged for
certain costs related to drilling and production operations which are required
to be capitalized for federal income tax purposes. These costs are treated as
capital contributions by the General Partner. In addition, Texland
Properties-1981 and Texland Petroleum, Inc. have invested in limited partnership
units in the amount of $95,000 and $30,000 respectively.

                                       7

<PAGE>
                      Texland Drilling Program-1981, Ltd.
                            (A Limited Partnership)

                   Notes To Financial Statements (Continued)
                                 March 31, 2002
                                  (Unaudited)


3.   Fees To Managing General Partner (Texland Petroleum, Inc.)

In consideration of its management services rendered, the Managing General
Partner is entitled to charge management fees to the Partnership. In addition,
for the three months ended March 31, 2002 and March 31, 2001, the Partnership
was charged $41,590 and $41,532 respectively for technical services, accounting
services, and supervisory services performed by the employees of the Managing
General Partner and such charges are included in intangible development costs,
production expenses and fees to Managing General Partner. These charges are
allocated between the General and Limited Partners based upon applicable revenue
and expense sharing rates.

                                       8

<PAGE>
                      Texland Drilling Program-1981, Ltd.
                            (A Limited Partnership)

               Management's Discussion And Analysis Of Financial
                      Condition And Results Of Operations

                                 March 31, 2002


The Partnership's average price per barrel of oil for the first quarter of 2002
was $13.58 as compared to $21.47 for the first quarter of 2001. The decreased
revenue and related severance tax expense result primarily from the decrease in
average oil prices. Certain normal expected declines in production were also
experienced over the past twelve months.

Depreciation, depletion and amortization for the first quarter of 2002 was
$43,606 as compared to $31,753 for the first quarter of 2001. Changes in
depreciation and depletion for 2000 through 2001, are due primarily to the
effect that changes in oil and gas prices have on the calculation of estimated
future economically recoverable oil and gas reserves.

The Partnership was formed with cash contributions from the Limited and General
Partners. Management does not intend to incur any substantial indebtedness and
any developmental drilling which is necessary will be processed by farmout to
other parties or by reinvestment of internally generated funds. Management,
therefore, anticipates no liquidity problems during the life of the Partnership.


                                       9

<PAGE>

Part II


Items 1 through 6
-----------------

Omitted - Not applicable to Registrant.


                                    Signature
                                    ---------

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

                                         Texland Drilling Program-1981, Ltd.



                                         By   /s/ Michael A. Chapman
                                           ---------------------------------
                                            M. E. Chapman, Vice President
                                            of Texland Petroleum, Inc.,
                                            General Partner - Texland
                                            Properties-1981

Date: May 14, 2002


                                       10