SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C. 20549

                            FORM 10 Q
(Mark One)

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

     For the quarterly period ended June 25, 2000

/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
    EXCHANGE ACT OF 1934

     For the transition period from           to       .

Commission File Number:  0-19717

                         WPI GROUP, INC.
                         ----------------

     (Exact name of registrant as specified in its charter)


             NEW HAMPSHIRE                      02-0218767
             --------------                     ----------
(State or other jurisdiction of                 (I.R.S. Employer
 incorporation or organization)                  Identification Number)


1155 Elm Street, Manchester, New Hampshire    03101
----------------------------------------------------
(Address of principal executive offices)    (Zip Code)


Registrant's telephone number, including area code: (603) 627-3500
                                                     -------------

--------------------------------------------------------------------
(Former name, former address, and former fiscal year, if changed
 since last report)

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
     ----    ----
Applicable only to issuers involved in bankruptcy proceedings
during the preceding five years:

Indicate by check mark whether the registrant filed all documents
and reports required to be filed by Section 12, 13 or 15(d) of
the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by the court.
Yes       No
    ----     ----
Applicable only to corporate issuers:

Indicate the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date:

       Class                     Outstanding as of August 3, 2000
       ------                    ---------------------------------
Common Stock, par value $.01               6,056,758 shares

<PAGE>

                       WPI GROUP, INC.


                            INDEX



PART I - FINANCIAL INFORMATION                           Page No.

  Item 1. Consolidated Financial Statements

         Consolidated Balance Sheets                         3
         - June 25, 2000 and September 26, 1999

         Consolidated Statements of Operations               4
         - Three months ended June 25, 2000 and June
           27, 1999
         - Nine months ended June 25, 2000 and June
           27, 1999

         Consolidated Statements of Cash Flows               5
         - Nine months ended June 25, 2000 and June
           27, 1999

         Notes to Consolidated Financial Statements          6

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

PART II - OTHER INFORMATION

  Item 6. Exhibits and Reports on Form 8-K                   11

SIGNATURES                                                   12

                             -2-
<PAGE>
<TABLE>
                       WPI GROUP, INC.

                 CONSOLIDATED BALANCE SHEETS
<CAPTION>
                                          September 26,    June 25,
                                              1999           2000
                                          -------------    ---------
                                                          (unaudited)
ASSETS
 <S>                                     <C>            <C>   <C>

CURRENT ASSETS

  Cash and cash equivalents               $  1,086,708   $     10,354


  Accounts receivable - net of allowance
  for doubtful accounts
  of $171,000 and $262,500, respectively     2,027,808      1,816,826
  Accounts receivable - other                  101,135         85,594
  Inventories                                  461,893        447,369
  Prepaid expenses and other current           238,550        213,409
  assets
  Refundable income taxes                      220,205        105,551
  Prepaid income taxes                       2,655,419        260,450
  Net assets of discontinued operations     54,200,000      9,200,000
                                          ------------    -----------
        Total current assets                60,991,728     12,139,553


PROPERTY, PLANT AND EQUIPMENT
  at cost less accumulated depreciation      1,668,473        810,411

OTHER ASSETS                                 1,896,868      1,766,163
                                           -----------    -----------
                                           $64,557,050    $14,716,127
                                           ===========    ===========

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Bank and other loans payable             $69,155,487    $28,624,840
  Accounts payable                           1,499,103      1,984,925
  Accrued expenses                           2,173,763      3,049,847
                                           -----------    -----------

       Total current liabilities            72,828,353     33,659,612
                                           -----------    -----------
DEFERRED INCOME TAXES                        2,702,987        307,562
                                           -----------    -----------
COMMITMENTS

STOCKHOLDERS' EQUITY (DEFICIT):
   Common stock, $.01 par value;
   authorized 20,000,000 shares, issued
   and outstanding 6,050,398
   and 6,056,758, respectively.                 60,504       60,568
   Additional paid-in capital               14,574,134    14,585,533
   Retained earnings (deficit)             (25,608,919)  (33,897,148)
                                          ------------   -----------
      Total stockholders' equity
      (deficit)                            (10,974,281)  (19,251,047)
                                          ------------   -----------
                                          $ 64,557,059   $14,716,127
                                          =============  ===========
</TABLE>


              See notes to financial statements

                             -3-

<PAGE>
<TABLE>
                       WPI GROUP, INC.
            CONSOLIDATED STATEMENTS OF OPERATIONS
                         (unaudited)
<CAPTION>
                               Three Months Ended         Nine Months Ended
                            June 27,       June 25,    June 27,       June 25,
                              1999           2000        1999            2000
                        ------------    -----------  -----------    ----------
<S>                      <C>             <C>          <C>            <C>
CONTINUING OPERATIONS
Net Sales                $  2,618,703    $ 3,573,724  $ 9,006,981    $10,734,845

Cost of Goods Sold          1,102,943      1,409,141    3,443,409      4,265,729

Gross Profit                1,515,760      2,164,583    5,563,572      6,469,116
                         ------------    -----------  -----------    ------------
Operating Expenses:
Research and new
product development           519,200        818,748    1,472,891      2,323,483
   Selling, general and
administration              2,098,932      1,670,593    5,923,988      5,731,183                                                8
   Restructuring costs          -               -         450,000      1,700,000
                         ------------    -----------   ----------     ----------
Total Operating
Expenses                    2,618,132      2,489,341    7,654,079     10,017,466
                         ------------    ------------  ----------     ----------

Operating Loss              (1,102,372)     (324,758)  (2,090,507)    (3,548,350)


Other Income (Expense):
   Interest expense           (133,297)   (1,030,919)    (386,625)     (2,022,424)
   Forbearance expense            -         (253,500)        -           (538,500)
   Other, net                   41,747         1,479       19,511          (3,955)
                         -------------    ----------    ---------      ----------
Loss before Benefit for
Income Taxes                (1,193,922)   (1,607,698)  (2,457,629)     (6,113,229)


Provision for Income
Taxes                          362,000          -            -               -
                         -------------    -----------   ----------     ----------
Loss from Continuing
Operations                  (1,555,922)   (1,607,698)   (2,457,621)    (6,113,229)

DISCONTINUED OPERATIONS
Loss from discontinued
operations (net of
applicable income
taxes)                      (1,692,564)         -        (2,865,737)          -

Estimated loss from
disposal of
discontinued operations           -         (615,000)          -       (2,175,000)
                        ---------------   -----------    -----------  -----------
Loss before cumulative
effect of change in
accounting principle        (3,248,486)   (2,222,698)    (5,323,358)   (8,288,229)

CUMULATIVE EFFECT OF
CHANGE  IN ACCOUNTING
PRINCIPLE, net of
applicable income taxes
of $1,000,000                     -             -         (2,822,147)        -
                          ------------   ------------    ------------  ------------
Net Loss                  $ (3,248,486)  $ (2,222,698)   $ (8,145,505) $ (8,288,229)
                          ------------   ------------    ------------  ------------

Earnings (Loss) Per Share
- Continuing Operations   $       (.26)  $       (.27)   $        (.41) $     (1.01)
(Note 3)                  ------------   ------------    -------------  -----------

</TABLE>

              See notes to financial statements

                            - 4 -

<PAGE>
<TABLE>

                       WPI GROUP, INC.
            CONSOLIDATED STATEMENTS OF CASH FLOWS
                         (unaudited)
<CAPTION>
                                              Nine Months Ended
                                            June 27,       June 25,
                                              1999          2000
                                          -------------  ------------
   <S>                                    <C>            <C>

CASH FLOWS FROM OPERATING ACTIVITIES:
   Net loss                               $  (8,145,505) $ (8,288,229)
                                          -------------  ------------
   Adjustments to reconcile net income
   to net cash
   Provided by operating activities:
   Cumulative effect of change in
   accounting principle                       2,822,147          -
   Depreciation and amortization              3,846,979     1,555,722
   Loss from disposal of discontinued
   operations                                      -        2,175,000
   Deferred income taxes                          9,292          -

   Changes in current assets and
   liabilities net of effects
   of acquisition:
   Accounts receivable                         4,618,742    4,327,085
   Accounts receivable - other                   (52,531)     476,833
   Inventories                                (3,061,493)    (664,932)
   Prepaid expenses and other current           (507,582)     (21,276)
   assets
   Accounts payable                              583,320   (1,853,532)
   Accrued expenses                              208,043      794,209
   Accrued income taxes                         (426,613)     405,439
                                             -----------   ----------
          Total adjustments                    8,040,304    7,194,548
                                             -----------   ----------
   Net cash provided by (used in)
   operating activities                         (105,201)  (1,093,681)
                                             -----------   ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Proceeds from sale of businesses                 -      41,203,602
   Additions to property, plant and
   equipment                                  (2,150,774)    (518,051)
   (Additions) deletions to other assets         (54,972)       2,905
   Payment of accrued acquisition costs         (397,453)    (151,945)
                                             -----------   ----------

   Net cash provided by (used in)
   investing activities                       (2,603,199)   40,536,511
                                             -----------    ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
   Increase (decrease) in current and
   long-term debt                              2,564,460   (40,530,647)
   Proceeds from issuance of common
   stock                                          35,958        11,463
   Proceeds from exercise of stock
   options                                        29,419          -

   Net cash provided by (used in)             ----------   -----------
   investing activities                        2,629,837   (40,519,184)
                                              ----------   -----------
EFFECT OF FOREIGN CURRENCY TRANSLATION
ON CASH                                          (30,007)         -
                                              ----------   -----------
NET DECREASE IN CASH AND CASH
EQUIVALENTS                                     (108,570)   (1,076,354)

CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD                               159,518     1,086,708
                                              -----------   -----------

CASH AND CASH EQUIVALENTS,
END OF PERIOD                             $        50,948  $     10,354
                                          ===============  ============

SUPPLEMENTAL DISCLOSURE OF CASH
INFORMATION:
   Income taxes paid (refunded)           $         70,246 $   (117,054)
   Interest paid                                 3,940,396    6,309,867

</TABLE>
                   See notes to financial statements

                            - 5 -

<PAGE>

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.   BASIS OF PRESENTATION

  The  financial  statements for the three months  and  nine
  months  ended  June  25,  2000  and  June  27,  1999   are
  unaudited  and  include  all  adjustments  which,  in  the
  opinion  of  management, are necessary to  present  fairly
  the  results  of  operations for the periods  then  ended.
  All  such  adjustments are of a normal  recurring  nature.
  These  financial statements should be read in  conjunction
  with  the  financial statements and notes thereto included
  in  the Company's Form 10-K filed with the Securities  and
  Exchange  Commission  (File No. 0-19717),  which  included
  financial  statements for the years  ended  September  26,
  1999 and September 27, 1998.

  Certain  prior  year  amounts have  been  reclassified  to
  conform with current year presentation.

  The  results  of the Company's operations for any  interim
  period  are  not necessarily indicative of the results  of
  the  Company's operations for any other interim period  or
  for a full fiscal year.
<TABLE>

2.   INVENTORIES
<CAPTION>
       Inventory consists of:      September 26,    June 25,
                                       1999           2000
                                   -------------  ---------------
       <S>                         <C>   <C>      <C>     <C>

       Raw Materials               $     315,071  $       280,164
       Work in Process                    27,340           56,309
       Finished Goods                    119,482          110,896
                                   -------------  ---------------
           Total                   $     461,893  $       447,369
                                   =============  ===============
</TABLE>
3.   EARNINGS (LOSS) PER SHARE
<TABLE>
  The following table sets forth the computation of basic
  and diluted earnings (loss) per share for the periods
  indicated:
<CAPTION>
                          Three Months Ended         Six Months Ended
                        June 27,     June 25,      June 27,     June 25,
                           1999        2000          1999        2000
                      ------------- ----------- ------------- ------------
Earnings (loss) per
share - basic
<S>                   <C>    <C>    <C>   <C>    <C>    <C>    <C> <C>

Continued operations  $      (0.26) $     (0.27) $      (0.41) $   (1.01)
Discontinued operations      (0.28)       (0.10)        (0.47)     (0.36)
Effect of
accounting change               -           -           (0.47)       -
                      ------------- ------------ ------------- -----------

Net loss              $       (0.54)$      (0.37)$      (1.35)  $   (1.37)
                      ------------- ------------ -------------  ----------

Earnings (loss) per
share - diluted

Continued operations  $       (0.26) $     (0.27)  $    (0.41)   $   (1.01)
Discontinued operations       (0.28)       (0.10)       (0.47)       (0.36)
Effect of
accounting change                -            -         (0.47)          -
                      -------------   -----------  ----------     ---------
Net loss              $       (0.54)  $     (0.37) $    (1.35)    $   (1.37)


Weighted Average
Common Shares             6,048,977      6,053,259   6,041,515     6,053,243
Effective of
Dilutive Shares                -              -           -              -
                       ------------   ------------  -----------    ----------
Adjusted Weighted
Average
Common Shares             6,048,977       6,053,259   6,041,515     6,053,243
                       ------------   -------------  ----------     ----------
</TABLE>

                            - 6 -

<PAGE>

  4.   RESTRUCTURING CHARGES

     During the nine months ended June 25, 2000, the Company
     entered into a severance agreement with certain  former
     executives  and  officers.  In  connection   with   the
     agreements, the Company recorded a restructuring charge
     of $1,770,000, consisting primarily of the continuation
     of  payroll and benefits subsequent to termination.  Of
     the  total restructuring charge, $320,000 will be  paid
     over  various periods ending August 2000. The remaining
     $1,450,000 will be paid over a five-year period  ending
     December 2004 in connection with the terms of a  former
     executive's  severance agreement. In  addition,  during
     the  nine months ended June 25, 2000, the Company  paid
     approximately  $91,000 in connection with  a  severance
     agreement  entered  into during the fiscal  year  ended
     September 26, 1999 with a former executive.

     The  Company's restructuring activity during  the  six-
     month period ending June 25, 2000 is as follows:

     Restructuring reserve balance at
       September 26, 1999              $   148,269

     Employee severance costs  accrued
     and charged to expense              1,770,000


     Charges  against reserve for  the
     nine months ended June 25, 2000      (649,971)
                                       -----------
     Restructuring reserve balance at
          June 25, 2000                $ 1,268,298
                                       ===========


  5.  DISCONTINUED OPERATIONS

     During its fiscal 1999, the Company adopted and  is  in
     the   process  of  implementing  a  restructuring  plan
     intended to focus on its MPSI business unit (a provider
     of   vehicle   diagnostic  systems).    In   connection
     therewith, the Company decided to divest itself of  its
     Industrial Technology Group segment.  In December 1999,
     the  Company completed the sale of its industrial power
     conversion  systems  and electronic ballast  businesses
     (WPI  Power Systems and WPI Electronics) to  a  private
     group  of  investors for approximately $9.3 million  in
     cash  plus  the  assumption of certain liabilities.  In
     February  2000, the Company completed the sale  of  its
     rugged  handheld computer and terminal  business  units
     (WPI  Husky Technology and WPI Oyster Termiflex,  Ltd.)
     to  Dynatech Corporation, for approximately $35 million
     in  cash  plus  the assumption of certain  liabilities.
     During  the  fiscal quarter ended June  25,  2000,  the
     Company  completed  the sale of WPI  Oyster  Termiflex,
     Inc.  and  certain real estate located  in  the  United
     Kingdom.  The  Company  is  also  in  the  process   of
     negotiating  the sale of its instruments  and  solenoid
     businesses (WPI Instruments and WPI Magnetec).

     In  connection with the completed business sales of its
     rugged  handheld computer and terminal business  units,
     Dynatech  Corporation has proposed certain  adjustments
     that may potentially effect the ultimate purchase price
     paid.  The Company believes the ultimate settlement  of
     these   matters   will   not  materially   impact   the
     accompanying financial statements.

     The Company recognized an estimated loss on disposal of
     discontinued  operations of approximately  $.6  million
     and  $2.2 million in the fiscal quarter and nine months
     ended   June  25,  2000.  The  losses  were   primarily
     attributable  to higher than anticipated  loss  on  the
     sale  of  its business units, the operating results  of
     the discontinued operations and higher than anticipated
     interest expense in the second quarter of fiscal 2000.


                            - 7 -

<PAGE>
                           ITEM 2.

      Management's Discussion and Analysis of Financial
             Condition and Results of Operations

  This Management's Discussion and Analysis of Financial
  Condition and Results of Operations should be read in
  conjunction with the financial statements and footnotes
  contained in the Company's Form 10-Q for the period
  ending March 26, 2000 and the Form 10-K for the year
  ended September 26, 1999, filed with the Securities and
  Exchange Commission. In addition to historical
  information, this report contains forward looking
  statements that involve risks and uncertainties that
  could cause actual results to differ materially.  Factors
  that might cause or contribute to such differences
  include, but are not limited to, those discussed in this
  section.  Readers should carefully review the risks
  described in other documents the Company files from time
  to time with the Securities and Exchange Commission,
  including the Company's Annual Report on Form 10-K where
  the fiscal year ended September 26, 1999.  Readers are
  cautioned not to place undue reliance on the forward
  looking statements, which speak only as of the date of
  this report.  The Company undertakes no obligation to
  publicly release any revisions to the forward looking
  statements or reflect events or circumstances after the
  date of this document.

  RESULTS OF OPERATIONS

  Continuing Operations

  Net sales of $3.6 million for the third quarter of fiscal
  2000 increased 36.5% from sales of $2.6 million for the
  third quarter of fiscal 1999.  For the first nine months
  of fiscal 2000 the Company reported sales of $10.7
  million, 19.2% higher than sales of $9.0 million for the
  first nine months of fiscal 1999. The increase was due to
  growth in shipments to the Company's primary target
  markets.

  Cost of sales of $1.4 million for the third quarter of
  fiscal 2000 resulted in a gross profit of 60.6%, compared
  to a gross profit of 57.9% for the same period of fiscal
  1999.  Cost of sales of $4.3 million for the first nine
  months of fiscal 2000 resulted in a gross profit of
  60.3%, compared to a gross profit of 61.8% for the same
  period of fiscal 1999.  The changes in the Company's
  gross profit percentage in fiscal 2000 compared to the
  same periods of fiscal 1999 was primarily attributable to
  a change in mix of products sold and decreased software
  licenses revenue.

  Research and new product development expenses were
  $818,000, 22.9% of sales, and $2.3 million, 21.6% of net
  sales, for the fiscal quarter and the nine months ended
  June 25, 2000, respectively. For the same fiscal quarter
  and nine month periods of fiscal 1999, research and new
  product development expenses were $519,000, 19.8% of
  sales, and $1.5 million, 16.4% of sales, respectively.
  The increase was attributed to the continued development
  of E-Technician, a web-based remote diagnostic platform.

  Selling, general and administration expenses were $1.7
  million and $2.1 million for the third quarter of fiscal
  2000 and 1999, respectively, and $5.9 million and $5.7
  million, for the nine months of fiscal 2000 and 1999,
  respectively. As a percentage of sales, selling, general
  and administrative expenses were 46.7% and 80.2% for the
  fiscal 2000 and 1999 quarters, respectively, and 55.2%
  and 63.6% for the nine month of fiscal 2000 and 1999,
  respectively.  The changes in selling, general and
  administrative expenses in fiscal 2000 are primarily
  attributable to a reduction in executive and
  administrative personnel costs offset by additional costs
  related to consultants and advisors incurred in
  connection with the debt negotiations with the bank
  syndicate.

  During the nine months ended June 25, 2000, the Company
  entered into various severance agreements with certain
  former executives.  In connection with the agreements,
  the Company recorded a restructuring charge of $1.8
  million during the nine months ended June 25, 2000,
  consisting primarily of the continuation of payroll and
  benefits payments subsequent to termination.

                            - 8 -

<PAGE>

  The Company's operating loss for the third quarter of
  fiscal 2000 and 1999 was ($325,000) and ($1.1) million,
  respectively. For the nine months ended June 25, 2000 and
  June 27, 1999 the Company's operating loss was ($3.5)
  million and ($2.1) million, respectively. The increase in
  the operating loss was primarily due to the increase in
  research and new product development costs, and the
  restructuring and non-recurring costs discussed above.

  The Company's other income (expense) was ($1.3) million
  for the third quarter of fiscal 2000 compared to
  ($92,000) in the third quarter of fiscal 1999. For the
  nine months ended June 25, 2000 and June 27, 1999 other
  income (expense) was ($2.6) million and ($367,000),
  respectively. The increase was due primarily to higher
  interest expense and $539,000 of fees incurred in
  connection with the execution of a forbearance agreement
  related to the Company's bank debt.

  Discontinued Operations

  The Company's loss from discontinued operations was
  ($1.7) million and ($2.9) million for the quarter and
  nine months ended June 27, 1999.  The loss was the result
  of lower sales in the Company's rugged handheld computer
  and terminal, power conversion and electronic ballasts
  businesses, increased costs and operating expenses as a
  result of the acquisition of WPI Instruments in August
  1998, and higher interest expense from additional
  borrowings and higher interest rates.

  The Company recognized an estimated loss on disposal of
  discontinued operations of $615,000 and $2.2 million for
  the third quarter and nine months ended June 25, 2000,
  respectively.  The loss was primarily attributable to a
  higher than anticipated loss on the sales of its rugged
  handheld computer and terminal businesses and the
  operating results of the discontinued operations and
  higher than anticipated interest expense.

  Cumulative Effect of Change in Accounting Principle

  As of September 28, 1998, in accordance with the
  statement of position 98-5 "Reporting on the Cost of
  Start-up Activities", the Company changed its method of
  accounting for deferred product enhancement costs to
  expense these costs as incurred.  As a result, the
  Company recognized a cumulative effect of a change in
  accounting principle of $2,822,000, net of taxes of
  $1,000,000.


  LIQUIDITY AND CAPITAL RESOURCES

  As of June 25, 2000 the Company had a working capital
  (deficit) of ($21.5) million compared to ($11.8) million
  at September 26, 1999. Net cash used in operating
  activities totaled $1.1 million and $105,000 for the nine
  months ended June 25, 2000 and June 27, 1999,
  respectively.

  As of June 25, 2000, the Company had no material
  commitments for capital expenditures.

  In  August  1998, the Company entered into a  $75  million
  credit  facility  with a syndication of banks,  consisting
  of  a  $20 million revolving line of credit which  was  to
  expire  on  September  30, 2003 and  term  notes  totaling
  approximately  $55  million payable in  varying  quarterly
  installments commencing on December 31, 1998  and  through
  September   30,  2004.   The  credit  facility   agreement
  contains certain restrictive covenants, including  certain
  financial  covenants  the Company was  not  in  compliance
  with  at  September 27, 1998, March 28, 1999 and June  27,
  1999.  The Company reached an agreement with the banks  to
  waive  the  events  of non-compliance  and  amend  certain
  terms of the credit agreement.

  During  the current fiscal year, the Company entered  into
  a   series  of  forbearance  agreements  with  the  banks.
  Pursuant  to the terms of the forbearance agreements,  the
  Company  confirmed  that all outstanding  borrowings  were
  due  and  payable.  The  agreements  limit  the  revolving
  credit  borrowings to $6.5 million and provides  that  all
  borrowings   bear  interest  at  prime  plus   5.5%.    In
  addition,  the  agreements provided  for  the  payment  of
  forbearance  and  other  fees  totaling  $538,500  to  the
  banks.

                            - 9 -
<PAGE>


  The  initial  forbearance period  ended  March  31,  2000.
  Subsequently,  the  Company  entered  into  a  series   of
  extensions  to the forbearance agreement the  most  recent
  expired August 7, 2000. The Company has requested  and  is
  presently  in the process of negotiating the  terms  of  a
  loan  modification agreement with the banks. There  is  no
  assurance the Company will be successful in negotiating  a
  loan  modification  agreement or further  extension  of  a
  forbearance agreement with the banks.

  During its fiscal 1999, the Company adopted and is in  the
  process  of implementing a restructuring plan intended  to
  focus  on its MPSI business unit (the provider of  vehicle
  diagnostic systems).  In connection therewith:

     1.   The  Company  decided  to  divest  itself  of  its
          Industrial Technology Group segment.  In  December
          1999,  the  Company  completed  the  sale  of  its
          industrial power conversion systems and electronic
          ballast  businesses  (WPI Power  Systems  and  WPI
          Electronics)  to a private group of investors  for
          approximately  $9.3  million  in  cash  plus   the
          assumption of certain liabilities. The Company  is
          also  in  the process of seeking a buyer  for  its
          instruments    and   solenoid   businesses    (WPI
          Instruments and WPI Magnetec).

     2.   On  February  22, 2000, the Company completed  the
          sale  of its rugged handheld computer and terminal
          business  units  (WPI  Husky  Technology  and  WPI
          Oyster  Termiflex, Ltd.) to Dynatech  Corporation,
          for  approximately $35 million in  cash  plus  the
          assumption of certain liabilities.

     3.   In April 2000, the Company completed the sale of a
          facility   located  in  the  United  Kingdom   for
          approximately $2.1 million in cash.

     4.   In  June  2000, the Company completed the sale  of
          WPI  Oyster Termiflex, Inc. to a private group  of
          investors for approximately $577,000 in cash  plus
          the assumption of certain liabilities.

  The   Company  utilized  the  cash  generated   from   the
  divestitures  of  the  businesses to repay  a  significant
  portion  of  the  existing bank debt and  to  support  the
  Companies'  operations.  The Company intends to  refinance
  its  remaining  debt  to provide sufficient  liquidity  to
  meet  its  continuing working capital requirements.  There
  is   no  assurance  the  Company  will  be  successful  in
  divesting   the   instruments  and  solenoid   businesses,
  refinancing  its existing debt or that sufficient  funding
  will be available to execute the present business plan.

  If  the  Company  is unable to successfully  complete  the
  sale   of  its  net  assets  of  discontinued  operations,
  renegotiate  its  bank  agreements and  obtain  additional
  funding,  the cash from operations will not be  sufficient
  to cover short-term or long-term liquidity requirements.


                            - 10-
<PAGE>


                       WPI GROUP, INC.

                 PART II - Other Information



  Item 6.   Exhibits and Reports on Form 8-K

          A.   Exhibits

               10.1 Forbearance Agreement dated March 31, 2000.

               10.2 Forbearance Agreement dated May 3, 2000.

               27   Financial Data Schedule.

          B.   Reports on Form 8-K

            On June 8, 2000, the Registrant filed a report
            under Item 2 of Form 8-K to reporting the sale
            of WPI Termiflex, Inc. to Warner Power, LLC.



                            - 11-
<PAGE>


                         SIGNATURES

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



                       WPI GROUP, INC.
                        (Registrant)




Date: August 8, 2000                     By:/s/John R. Allard
                                            -----------------
                                             John R. Allard
                                             President and
                                             Chief Executive Officer









Date: August 8, 2000                     By:/s/John W. Powers
                                            -----------------
                                             John W. Powers
                                             Vice President
                                             and Chief Financial Officer
                            -12-
<PAGE>