===============================================================================
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q


            [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF
                      THE SECURITIES EXCHANGE ACT OF 1934
                       For the Period Ended June 30, 1997

                                       or

            [ ] 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 0-28652

                        AMERICAN DISPOSAL SERVICES, INC.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

                   Delaware                           13-3858494
        -------------------------------          --------------------
        (State or other jurisdiction of            (I.R.S. Employer
         incorporation or organization)           Identification No.)

            745 McClintock - Ste 230
              Burr Ridge, Illinois                       60521
        -------------------------------          --------------------
    (Address of principal executive offices)          (Zip Code)

                                 (630) 655-1105
              ----------------------------------------------------
              (Registrant's telephone number, including area code)

                                 Not applicable
              ----------------------------------------------------
              (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  periods 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 CORPORATE ISSUERS

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practical date.

Common Stock, $.01 Par Value - 14,259,625 shares as of August 12, 1997

===============================================================================

<PAGE>




                        AMERICAN DISPOSAL SERVICES, INC.

                                      INDEX

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

   Condensed Consolidated Balance Sheets - June 30, 1997 and December 31, 1996

   Condensed Consolidated Statements of Operations - Three months ended June 30,
   1997 and 1996; Six months ended June 30, 1997 and 1996

   Condensed  Consolidated  Statements of Cash Flows - Six months ended June 30,
   1997 and 1996

   Notes to the Condensed Consolidated Financial Statements

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


PART II. OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K

Signatures



                                        2

<PAGE>



PART I. FINANCIAL INFORMATION
                       
                        AMERICAN DISPOSAL SERVICES, INC.
                      
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                             (Dollars in Thousands)

<TABLE>
<CAPTION>
                                                                            
                                                                 June 30, 1997            December 31,     
                                                                  (Unaudited)                 1996
                                                                ---------------         ---------------
<S>                                                             <C>                     <C>     
                                ASSETS

Current assets:
  Cash and cash equivalents                                     $       2,166           $       2,301
  Restricted cash held in escrow                                        2,900                       -
  Trade receivables, net                                               18,217                   9,741
  Prepaid expenses and other                                            1,872                   1,248
  Inventory                                                               541                     354
                                                                ---------------         ---------------
Total current assets                                                   25,696                  13,644

Property, plant, and equipment, net                                   128,035                  93,692

Other assets:
  Cost over fair value of net assets of acquired businesses,
    net of accumulated amortization of $1,966 and $1,374               64,484                  31,237
  Other intangible assets, net of accumulated amortization
    of $555 and $439                                                    1,862                   1,610
  Debt issuance costs, net of accumulated amortization
    of $425 and $204                                                    3,144                   2,392
  Other assets                                                          1,352                   2,411
                                                                ---------------         ---------------
                                                                $     224,573           $     144,986
                                                                ===============         ===============

                  LIABILITIES AND STOCKHOLDERS' EQUITY 

Current liabilities:
  Accounts payable                                              $       6,161           $       3,359
  Accrued liabilities                                                   9,165                   4,249
  Deferred revenues                                                     3,740                   2,245
  Current portion of long-term debt and capital lease 
    obligations                                                         1,286                   2,572
                                                                ---------------         ---------------
Total current liabilities                                              20,352                  12,425

Long-term debt and capital lease obligations, net of 
  current portion                                                      63,817                  65,445
Accrued environmental and landfill costs                                9,116                   7,603
Deferred income taxes                                                   1,416                   1,416

Total stockholders' equity (13,472,501 and 8,872,381
  shares of common stock issued and outstanding)                      129,872                  58,097
                                                                ---------------         ---------------
                                                                $     224,573           $     144,986
                                                                ===============         ===============
</TABLE>

See accompanying notes.
                                       3

<PAGE>

                        AMERICAN DISPOSAL SERVICES, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                  (Dollars in Thousands, Except per Share Data)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                    Three Months Ended              Six Months Ended
                                                         June 30,                       June 30,
                                                    1997           1996            1997          1996
                                                 ----------     ----------      ----------    ----------
<S>                                              <C>            <C>             <C>           <C>     
Revenues                                         $ 27,763       $ 13,453        $ 46,274      $ 25,177
Cost of operations                                 15,188          7,062          25,080        13,170
Selling, general and administrative expenses        3,672          2,113           6,357         4,048
Depreciation and amortization                       5,272          2,945           9,056         5,663
                                                 ----------     ----------      ----------    ----------
  Operating income                                  3,631          1,333           5,781         2,296

Interest expense, net                               1,906          1,518           3,458         3,057
Other income                                           88             37             109            37
                                                 ----------     ----------      ----------    ----------
  Income (loss) before income taxes
    and extraordinary loss                          1,813           (148)          2,432          (724)

Income tax benefit (expense)                         (577)            (5)           (750)          155
                                                 ----------     ----------      ----------    ----------
  Income (loss) before extraordinary loss           1,236           (153)          1,682          (569)

Extraordinary loss, net of income tax benefit           -           (476)              -          (476)
                                                 ----------     ----------      ----------    ----------
  Net income (loss)                                 1,236           (629)          1,682        (1,045)

Preferred stock dividend                                -            (46)              -          (109)
                                                 ----------     ----------      ----------    ----------
  Net income (loss) applicable to common
     stockholders                                $  1,236       $   (675)       $  1,682      $ (1,154)
                                                 ==========     ==========      ==========    ==========


NET INCOME (LOSS) PER SHARE:
  Income (loss) before extraordinary loss        $   0.10       $  (0.03)       $   0.15      $  (0.12)
  Extraordinary loss, net of income tax
    benefit                                             -          (0.08)              -         (0.08)
                                                 ----------     ----------      ----------    ----------
  Net income (loss) applicable to common
    stockholders                                 $   0.10       $  (0.11)       $   0.15      $  (0.20)
                                                 ==========     ==========      ==========    ==========

Weighted average common stock
  and common stock equivalent
  shares outstanding                             12,240,956      5,864,078      10,884,592     5,864,078
                                                 ==========     ==========      ==========    ==========
</TABLE>

See accompanying notes.



                                        4

<PAGE>



                        AMERICAN DISPOSAL SERVICES, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (Dollars in Thousands)
                                  (Unaudited)
<TABLE>
<CAPTION>
                                                                                      Six Months Ended
                                                                                          June 30,
                                                                                    1997            1996
                                                                                 -----------     ----------
<S>                                                                              <C>             <C>    
OPERATING ACTIVITIES:

Net income (loss)                                                                $   1,682       $ (1,154)
Adjustments to reconcile net income (loss) to net cash provided by
 (used in) operating activities:
  Depreciation and amortization                                                      9,056          5,663
  Provision for environmental and landfill costs                                       263            264
  Extraordinary loss                                                                     -            476
  Changes in operating assets and liabilities, net of effects from acquisitions:
    Trade receivables                                                               (5,112)        (1,292)
    Prepaid expenses, restricted cash held in escrow and other assets               (2,559)        (1,842)
    Accounts payable, accrued liabilities and accrued environmental
       and landfill costs                                                            7,099            251
    Deferred revenue                                                                   908            244
                                                                                 -----------     ----------
Net cash provided by operating activities                                           11,337          2,610
                                                                                 -----------     ----------

INVESTING ACTIVITIES:

  Capital expenditures                                                              (9,429)        (6,610)
  Cost of acquisitions                                                             (68,210)        (3,096)
                                                                                 -----------     ----------
Net cash used in investing activities                                              (77,639)        (9,706)
                                                                                 -----------     ----------

FINANCING ACTIVITIES:

  Net proceeds from issuance of common stock                                        70,093              -
  Redemption of preferred stock                                                          -         (1,950)
  Preferred stock dividend                                                               -            (85)
  Proceeds from issuance of long-term debt                                          70,946         71,245
  Repayments of indebtedness                                                       (73,899)       (52,866)
  Payment of note payable to stockholder                                                 -        (12,500)
  Debt issuance costs                                                                 (973)        (1,081)
  Other                                                                                  -           (552)
                                                                                 -----------     ----------
Net cash provided by financing activities                                           66,167          2,211
                                                                                 -----------     ----------
Net decrease in cash and cash equivalents                                             (135)        (4,885)
Cash and cash equivalents, at beginning of period                                    2,301          6,383
                                                                                 -----------     ----------
Cash and cash equivalents, at end of period                                      $   2,166       $  1,498
                                                                                 ===========     ==========
</TABLE>

See accompanying notes.


                                        5

<PAGE>



                        AMERICAN DISPOSAL SERVICES, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                             June 30, 1997 and 1996
                                   (Unaudited)


1.   Formation and Basis of Presentation
     ADS, Inc. (ADS) was organized on January 15, 1991, to acquire, develop, and
operate non-hazardous municipal solid waste disposal,  collection,  and transfer
operations and provide non-hazardous solid waste disposal management services to
commercial,  industrial, and residential customers. During 1993, an affiliate of
Charterhouse  Equity  Partners,  L.P. (CEP) purchased a controlling  interest in
ADS.

     County  Disposal,  Inc.  (County) was  incorporated by Charterhouse  Equity
Partners  II,  L.P.  (CEPII) on April 27,  1995,  for the  purpose of  acquiring
certain  net  assets of  Envirite  Corporation  (Envirite).  On April 28,  1995,
Envirite and County  entered into an Asset  Purchase  Agreement  whereby  County
agreed  to  purchase  from  Envirite  certain  landfill   facilities  and  waste
transportation and collection equipment located in Livingston County,  Illinois,
and Wyandot  County,  Ohio; all of the issued and  outstanding  capital stock of
County  Environmental  Services,  Inc., a  wholly-owned  subsidiary of Envirite,
which  owned and  operated  a landfill  facility  and waste  transportation  and
collection  equipment  located  in Clarion  County,  Pennsylvania;  and  certain
related assets and assumption of certain liabilities.

     Effective  January 1, 1996, the  stockholders  of ADS and County  exchanged
their  shares  for  shares of a newly  created  holding  company  by the name of
American  Disposal  Services,  Inc.  (the  Company).  This share  exchange  (the
Exchange)  qualified  as  a  transfer  of  companies  under  common  control  as
affiliates of Charterhouse  Group  International,  Inc. are the general partners
and in control of CEP and CEPII and, accordingly,  the transaction was accounted
for at historical cost in a manner similar to pooling of interests accounting.

     The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally  accepted  accounting  principles for
interim financial information and with the instructions to Form 10-Q and Article
10 of Regulation  S-X.  Accordingly,  they do not include all of the information
and footnotes required by generally accepted accounting  principles for complete
financial statements. In the opinion of management,  all adjustments (consisting
of normal recurring accruals)  considered necessary for a fair presentation have
been  included.  Operating  results for the six month period ended June 30, 1997
are not  necessarily  indicative  of the results  that may be  expected  for the
fiscal year ending December 31, 1997. These financial  statements should be read
in conjunction with the consolidated  financial statements,  including the notes
thereto,  for the fiscal year ended  December 31, 1996 included in the Company's
Annual Report on Form 10-K/A.

     The  preparation  of financial  statements  in  conformity  with  generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that affect the amounts  reported in the financial  statements  and
accompanying notes. Actual results could differ from those estimates.

2.   Related Party Interest Expense
<TABLE>
<CAPTION>
                                                Three months ended            Six months ended
                                                     June 30,                     June 30,
                                              -----------------------       ----------------------
                                               1997             1996         1997            1996
                                              ------           ------       ------          ------
                                                              (Dollars in Thousands)

<S>                                           <C>              <C>          <C>             <C>  
Charterhouse Equity Partners II, L.P......    $   -            $ 262        $   -           $ 621
                                              ======           ======       ======          ======
</TABLE>


                                        6

<PAGE>



3.   Environmental Matters
     See the  Company's  Annual  Report  on Form  10-K/A  for a  description  of
environmental matters.

4.   Public Offering
     Effective May 13, 1997 the Company completed a public offering of 4,600,000
shares (including the underwriters'  over-allotment  option) at $16.50 per share
resulting  in net  proceeds  to the  Company  of  approximately  $70.1  million.
Immediately following the offering,  the Company had 13,472,501 shares of common
stock outstanding.

5.   Acquisitions
     The acquisitions below have been accounted for using the purchase method of
accounting and, accordingly,  the results of their operations have been included
in the Company's results of operations from their respective  acquisition dates.
The purchase  prices have been allocated to the assets  acquired and liabilities
assumed based on their fair values at their  respective  acquisition  dates with
the residual allocated to cost over fair value of net assets acquired.

     During  the  first  six  months  of  1997,   the  Company   acquired   nine
non-hazardous solid waste businesses,  consisting of nine collection operations,
two transfer  stations,  and one  landfill.  During 1996,  the Company  acquired
sixteen  nonhazardous  solid waste businesses,  consisting of sixteen collection
operations and two transfer stations.

     The Company has not completed its valuation of certain of its 1997 and 1996
purchases  and the  purchase  price  allocations  are  subject  to  change  when
additional information concerning asset and liability valuations is completed.

     The pro forma unaudited  results of operations for the three and six months
ended June 30, 1997 and 1996,  assuming each acquisition and the public offering
above had occurred on January 1, 1996, are as follows (in thousands,  except per
share data):
<TABLE>
<CAPTION>
                                                   Three Months Ended                              Six Months Ended
                                                        June 30,                                        June 30,
                                                  1997              1996                        1997              1996
                                              ------------      ------------                ------------      ------------
<S>                                           <C>               <C>                         <C>               <C>    
Revenues                                        $29,545            $24,149                     $55,421           $46,038
Operating income                                  3,818              2,828                       7,377             5,264
Net income applicable to common
  stockholders before extraordinary loss          1,659                983                       3,169             1,651
Pro forma income per share of
  common stock                                     0.12               0.09                        0.22              0.16
Weighted average common stock and
  common stock equivalent shares
  outstanding                                    14,182             10,464                      14,148            10,464
</TABLE>

     The  proforma  results do not  purport to be  indicative  of the results of
operations which actually would have resulted had the  acquisitions  occurred on
January 1, 1996 nor are they necessarily indicative of future operating results.

6.   Recently Issued Accounting Standard
     In February 1997, the Financial Accounting Standards Board issued Statement
No.  128,  Earnings  per Share,  which is  required  to be adopted in the fourth
quarter of 1997; earlier adoption is not allowed. At that time, the Company will
be required to change the method  currently  used to compute  earnings per share
and to restate all prior periods.  Under the new  requirements  for  calculating
basic earnings per share, the dilutive effect of stock options will be excluded.
The impact of  Statement  128 on the  calculation  of primary and fully  diluted
earnings  per share for the three and six months ended June 30, 1997 and 1996 is
not material.



                                        7

<PAGE>



                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     The following  discussion  should be read in conjunction with the Company's
unaudited  Condensed  Consolidated  Financial  Statements  and the related notes
thereto included elsewhere herein.

INTRODUCTION
     The Company has adopted an  acquisition-based  growth strategy that focuses
on: (i) the  identification  and acquisition of solid waste landfills located in
secondary  markets  that are  within  approximately  125  miles  of  significant
metropolitan  centers;  and  (ii)  securing  dedicated  waste  streams  for such
landfills  by the  acquisition  or  development  of  transfer  stations  and the
acquisition of collection  companies.  The Company has completed 42 acquisitions
from January 1993 through June 1997,  including nine collection  companies,  one
landfill,  and two transfer  stations  acquired in the six months ended June 30,
1997 (the "1997  Acquisitions").  All of these  acquisitions  were accounted for
under the purchase method of accounting for business combinations.  Accordingly,
the  amortization  of goodwill  and landfill  airspace  reflects the fair market
value of the Company's assets at the time of their acquisition rather than their
historical  cost  basis,  and  the  results  of  operations  for  such  acquired
businesses  are included in the  Company's  financial  statements  only from the
applicable date of acquisition. As a result, the Company believes its historical
results of operations for the periods presented are not directly comparable.

FORWARD LOOKING STATEMENTS
     Certain  information  contained  in this  Quarterly  Report  on Form  10-Q,
including,  without  limitation  information  appearing  under  Part I,  Item 2,
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations," are  forward-looking  statements (within the meaning of Section 27A
of the Securities Act of 1933 and Section 21E of the Securities  Exchange Act of
1934).  Factors  set forth  under the caption  "Risk  Factors" in the  Company's
Registration Statement on Form S-1 could affect the Company's actual results and
could  cause the  Company's  actual  results  to differ  materially  from  those
expressed  in any  forward-looking  statements  made by,  or on behalf  of,  the
Company in this Quarterly Report on Form 10-Q.

GENERAL
     The  Company's  revenues  are  attributable  primarily  to fees  charged to
customers for waste collection,  transfer and disposal  services.  The Company's
collection  services are generally  provided  under direct  agreements  with its
customers or pursuant to contracts with municipalities. Commercial and municipal
contract terms, where used,  generally range from one to five years and commonly
have automatic  renewal  options.  A relatively small portion of such agreements
also provide for the prepayment of certain fees, which are reflected as deferred
revenues. The table below shows for the periods indicated, the percentage of the
Company's total revenues attributable to services provided:

                         Three Months Ended               Six Months Ended
                              June 30,                         June 30,
                        1997             1996           1997             1996
                      --------         --------       --------         --------
 Collection (1)         52.3%            40.3%          51.0%            40.0%
 Transfer                3.7              2.6            3.7              2.2
 Landfill (1)           43.1             57.1           44.4             57.8
 Other                   0.9                -            0.9                -
                     ---------         --------       --------         --------
 Total Revenues        100.0%           100.0%         100.0%           100.0%
                     =========         ========       ========         ========


(1)  The portion of collection  revenues  attributable  to disposal  charges for
     waste  collected by the Company and disposed of at the Company's  landfills
     has been  excluded  from  collection  revenues  and  included  in  landfill
     revenues.


                                        8

<PAGE>



     A   component   of  the   Company's   business   strategy  is  to  maximize
internalization of waste it collects and thereby realize higher margins from its
operations.  By  disposing  of waste at  Company-owned  landfills,  the  Company
retains the margin generated through disposal operations that would otherwise be
earned by  third-party  landfills.  For the three  months  ended June 30,  1997,
approximately  85% of the total tonnage collected by the Company was disposed of
at   Company-owned   landfills.   For  the  six  months  ended  June  30,  1997,
approximately  87% of the total tonnage collected by the Company was disposed of
at Company-owned  landfills.  This represents  approximately  34% and 33% of the
total tonnage disposed of at Company-owned landfills in the three and six months
ended June 30,  1997,  respectively.  During the six months ended June 30, 1997,
the Company's  captive waste  (consisting of waste  collected by the Company and
delivered to any of its  landfills  and waste  delivered to any of the Company's
landfills  by  third-party   haulers  under  long-term   collection   contracts)
constituted  an average of  approximately  71% of the solid waste disposed of at
its landfills.

     The Company has  estimated  that,  as of December 31, 1996,  closure  costs
expected to occur during the operating  lives of these  facilities  and expensed
over these facilities' useful lives will approximate $35.2 million. In addition,
the  Company  has  estimated  that,  as of December  31,  1996,  total costs for
post-closure  activities,  including cap  maintenance,  groundwater  monitoring,
methane gas control and recovery and  leachate  treatment/disposal  for up to 30
years after closure in certain cases, will be approximately  $10.9 million.  The
December  31,  1996  and  June 30,  1997,  accruals  for  landfill  closure  and
post-closure   costs  (including  costs  assumed  through   acquisitions)   were
approximately $7.6 million and $9.1 million,  respectively. The accruals reflect
relatively  young  landfills with estimated  remaining  lives,  based on current
waste flows, that range from  approximately  three to 50 years, and an estimated
average remaining life of greater than 20 years.

RESULTS OF OPERATIONS
     The  following  table  sets  forth  items  in  the  Company's  consolidated
statement of operations as a percentage of revenues for the periods indicated:
<TABLE>
<CAPTION>
                                                      Three Months Ended              Six Months Ended
                                                            June 30,                      June 30,
                                                        1997        1996             1997         1996
                                                      --------    --------         --------     --------
<S>                                                   <C>         <C>              <C>          <C>    
  Revenues...........................................  100.0 %     100.0 %          100.0 %      100.0 %
  Cost of operations.................................   54.7        52.5             54.2         52.3
  Selling, general and administrative expenses.......   13.2        15.7             13.7         16.1
  Depreciation and amortization expenses.............   19.0        21.9             19.6         22.5
                                                      --------    --------         --------     --------
  Operating income...................................   13.1         9.9             12.5          9.1
  Interest expense, net..............................    6.9        11.3              7.5         12.1
  Other income.......................................    0.3         0.3              0.2          0.1
  Income tax provision (benefit).....................    2.1           -              1.6         (0.6)
  Extraordinary loss, net of income tax benefit......      -         3.5                -          1.9
                                                      --------    --------         --------     --------
    Net income (loss)................................    4.4 %      (4.6)%            3.6 %       (4.2)%
                                                      ========    ========         ========     ========

  EBITDA margin (1)..................................   32.1%       31.8 %           32.1 %       31.6 %
                                                      ========    ========         ========     ========
</TABLE>


(1) EBITDA margin represents operating income plus depreciation and amortization
divided by revenues.


THREE MONTHS ENDED JUNE 30, 1997 AND 1996

     REVENUES.    Revenues for the three months ended June 30, 1997 were $27.8 
million compared to $13.5 million for the three months ended June 30, 1996.  
Of the $14.3 million  increase in revenues, $12.1 million is due primarily

                                        9

<PAGE>



to the effects of companies  acquired during 1996, (the operations of which were
included in the Company's  financial  results for the full six months ended June
30, 1997) and the additional  impact of  acquisitions  completed  during the six
months  ended June 30,  1997.  Approximately  $2.2  million is  attributable  to
increases in revenues in operations acquired prior to April 1996.

     COST OF OPERATIONS.  Cost of operations for the three months ended June 30,
1997 were $15.2 million compared to $7.1 million for the three months ended 
June 30, 1996. This increase in costs was attributable  primarily to increases 
in the Company's  revenues  described  above.  As a  percentage  of  revenues,  
cost of operations  was 54.7% in the 1997 period  compared to 52.5% in the 1996
period.  The increased costs as a percentage of the Company's  overall revenue 
are due to the impact of more substantial collection versus landfill operations 
in the 1997 period  compared to the same period in 1996,  in  accordance  with 
the Company's acquisition-based growth strategy.

     SELLING,  GENERAL AND  ADMINISTRATIVE  EXPENSES.  SG&A  expenses  were $3.7
million for the three  months  ended June 30, 1997  compared to $2.1 million for
the three months ended June 30, 1996.  This  increase in costs was  attributable
primarily  to  increases  in  the  Company's  revenues  described  above.  As  a
percentage of revenues, SG&A expenses decreased to 13.2% in the 1997 period from
15.7% in the 1996  period.  The  decrease in SG&A  expenses as a  percentage  of
revenues is due primarily to a significant increase in revenue producing assets,
while corporate and other related administrative expenses increased moderately.

     DEPRECIATION  AND  AMORTIZATION  EXPENSE.   Depreciation  and  amortization
expense for the three months  ended June 30, 1997 was $5.3  million  compared to
$2.9  million  for the  three  months  ended  June 30,  1996.  The  increase  in
depreciation  and  amortization  expense is due  primarily  to  increases in the
Company's  revenues  described above. As a percentage of revenues,  depreciation
and amortization expense was 19.0% and 21.9% for the three months ended June 30,
1997 and 1996, respectively. The decline as a percentage of revenues in the June
1997 period  compared to the June 1996 period is due primarily to the diminished
concentration of landfill assets,  which typically have higher  depreciation and
amortization expense than collection operations.

     NET INTEREST  EXPENSE.  Net interest expense was $1.9 million for the three
months  ended June 30, 1997  compared to $1.5 million for the three months ended
June 30, 1996,  which is  attributable  to  additional  debt incurred in 1997 to
finance certain acquisitions.

     INCOME TAXES.  The Company recorded an income tax provision of $577,000 for
the three months ended June 30, 1997  compared to a $5,000  income tax provision
for the three months ended June 30, 1996.


SIX MONTHS ENDED JUNE 30, 1997 AND 1996

     REVENUES.  Revenues  for the six  months  ended  June 30,  1997 were  $46.3
million compared to $25.2 million for the six months ended June 30, 1996. Of the
increase in revenues, $16.7 million is due primarily to the effects of companies
acquired  during 1996,  the  operations  of which were included in the Company's
financial results for the full six months ended June 30, 1997 and the additional
impact of  acquisitions  completed  during the six months  ended June 30,  1997.
Approximately   $4.4  million  is  attributable  to  increases  in  revenues  in
operations acquired prior to 1996.

     COST OF  OPERATIONS.  Cost of operations  for the six months ended June 30,
1997 were $25.1 million  compared to $13.2 million for the six months ended June
30, 1996. This increase was  attributable  primarily to the increase in revenues
described  above.  As a percentage of revenues,  cost of operations was 54.2% in
the 1997 period  compared to 52.3% in the 1996 period.  The increased costs as a
percentage  of the  Company's  overall  revenues  are due to the  impact of more
substantial collection versus landfill operations in the 1997 period compared to
the same period in 1996,  in  accordance  with the  Company's  acquisition-based
growth strategy.

     SELLING,  GENERAL AND ADMINISTRATIVE  EXPENSES.  SG&A expenses increased to
$6.4 million for the six months ended June 30, 1997 compared to $4.0 million for
the six months ended June 30, 1996. As a percentage  of revenues,  SG&A expenses
decreased  to 13.7% in the  1997  period  from  16.1%  in the 1996  period.  The
decrease in SG&A

                                       10

<PAGE>



expenses as a percentage of revenues is due primarily to a significant  increase
in revenue  producing assets,  while corporate and other related  administrative
expenses increased moderately.

     DEPRECIATION  AND  AMORTIZATION  EXPENSE.   Depreciation  and  amortization
expense for the six months ended June 30, 1997 was $9.1 million compared to $5.7
million for the six months ended June 30, 1996. The increase in depreciation and
amortization  expense is due  primarily to increases in the  Company's  revenues
described  above.  As a percentage of revenues,  depreciation  and  amortization
expense  was 19.6% and 22.5% for the six months  ended  June 30,  1997 and 1996,
respectively.  The  decline as a percent  of  revenues  in the June 1997  period
compared  to  the  June  1996  period  is  due   primarily  to  the   diminished
concentration of landfill assets,  which typically have higher  depreciation and
amortization expense than collection operations.

     NET INTEREST  EXPENSE.  Net  interest  expense was $3.5 million for the six
months  ended June 30, 1997  compared to $3.1  million for the six months  ended
June 30, 1996.  This increase is  attributable  to  additional  debt incurred to
complete certain 1997 acquisitions.

     INCOME TAXES.  The Company recorded an income tax provision of $750,000 for
the six months ended June 30, 1997 and an income tax benefit of $155,000 for the
six months ended June 30, 1996.


LIQUIDITY AND CAPITAL RESOURCES

     Due to the  capital  intensive  nature of the  solid  waste  industry,  the
Company  has  used,  and  expects  to  continue  using,  substantially  all cash
generated  from  operations  to  fund  acquisitions,  capital  expenditures  and
landfill  development.  Certain operating equipment has also been acquired using
leases which have short and medium-term maturities. As a result, the Company has
incurred  working  capital  deficits in the past,  and there can be no assurance
that its  available  working  capital  will be  sufficient  in the  future as it
pursues its  acquisition-based  growth strategy.  Historically,  the Company has
satisfied  its  acquisition,  capital  expenditure  and  working  capital  needs
primarily  through  equity and bank  financings.  There can be no assurance that
such financing will continue to be available.

     Operating  activities  in the quarter  provided  net cash of $11.3  million
compared to $2.6 million in the six months ended June 30, 1996,  reflecting  the
additional operating contribution of the companies acquired.

     Investing activities used net cash of $77.6 million and $9.7 million in the
six months ended June 30, 1997 and 1996,  respectively.  The  Company's  capital
expenditure  and working  capital  requirements  have  increased  significantly,
reflecting the Company's  rapid growth by acquisition and development of revenue
producing  assets,  and will increase further as the Company continues to pursue
its  acquisition-based  growth  strategy.  During the six months  ended June 30,
1997,  the Company  spent $9.4  million in capital  expenditures,  of which $4.5
million was for cell  development.  In fiscal year 1997, the Company  expects to
spend approximately $18.0 million for capital expenditures of which $9.0 million
is  anticipated  to be used for cell  development.  In connection  with the 1997
Acquisitions, the Company invested $68.2 million.

     In the six months ended June 30, 1997,  financing  activities  provided net
cash of $66.2 million,  principally from the Company's May 1997 public offering,
compared to $2.2 million for the six months ended June 30, 1996.

     On May 22, 1997, the Company increased the amount of its revolving and term
loan (the "Credit Facility") with ING (U.S.)  Capital  Corporation,  as  
administrative agent, Morgan  Guaranty  Trust  Company  of New York,  as 
syndication  agent, Union Bank of California, N.A., as documentation agent, and 
BHF-Bank Aktiengesellschaft and Bank of America Illinois, as co-agents, for the 
lenders, from $125 million to $200  million.  The Credit  Facility  provides the
Company with a term loan of $60 million and an expansion  facility of 
$140 million to be used for  acquisitions  (of which $20 million may be used for
working  capital  and letter of credit  purposes).  The various  loans and lines
of credit under the Credit  Facility  bear  interest at rates per annum equal 
to, at the Company's  discretion,  either:  (i) the prime rate,  plus an  
applicable margin;  or (ii) the London  Interbank  Offered Rate ("LIBOR"),  plus
an applicable  margin, and have maturities ranging from 2002 to 2004.  As of 
June 30, 1997,  the Company had borrowed  $61.4  million  under the Credit
Facility.  At such date, the total unused  availability  under the Credit
Facility  was $138.6  million,  of which  $20.0  million may be used for working
capital purposes. The Company's ability to use the

                                       11

<PAGE>



expansion  facility  is  based  upon  a  number  of  covenants,   including  the
maintenance of specified  debt to equity and fixed charge  coverage  ratios.  At
June 30, 1997 the Company was in compliance with the terms of these covenants.

     Effective  May 13,  1997,  the  Company  completed  a  public  offering  of
4,600,000 shares (including the underwriters'  over-allotment  option) at $16.50
per share.  This resulted in net proceeds to the Company of approximately  $70.1
million which were used to pay down a portion of the Company's  Credit Facility.
Immediately following the offering,  the Company had 13,472,501 shares of common
stock outstanding.

     The Company  intends to satisfy its interest  obligations as well as future
capital  expenditures  and working  capital  requirements,  with cash flows from
operations and borrowings  under the Credit Facility.  However,  the Company may
need to raise  additional  capital to fund the  acquisition  and  integration of
additional solid waste businesses. The Company may raise such funds through bank
financings  or public or private  offerings of its  securities.  There can be no
assurance that the Company will be able to secure such funding, if necessary, on
favorable  terms,  if at all. If the Company is not  successful in securing such
funding,  the Company's  ability to pursue its business strategy may be impaired
and results of operations for future periods may be adversely affected.

     The Company expects that Subtitle D and other regulations that apply to the
non-hazardous  waste  disposal  industry  will require the  Company,  as well as
others in the industry,  to alter  operations and to modify or replace  existing
facilities.  Such  expenditures  have been and will continue to be  substantial.
Regulatory  changes could  accelerate  expenditures for closure and post-closure
monitoring and obligate the Company to spend sums in addition to those presently
reserved  for such  purposes.  The  factors,  together  with the  other  factors
discussed above, could substantially increase the Company's operating costs.


INFLATION AND PREVAILING ECONOMIC CONDITIONS
     To  date,  inflation  has not had a  significant  impact  on the  Company's
operations.  Consistent with industry practice,  most of the Company's contracts
provide for a pass  through of certain  costs,  including  increases in landfill
tipping fees and, in some cases, fuel costs. The Company  therefore  believes it
should be able to  implement  price  increases  sufficient  to offset  most cost
increases resulting from inflation. However, competitive factors may require the
Company  to absorb  at least a portion  of these  cost  increases,  particularly
during periods of high inflation.  The Company is unable to determine the future
impact of a sustained economic slowdown.


SEASONALITY
     The Company's revenues tend to be somewhat lower in the winter months. This
is primarily  attributable to the fact that: (i) the volume of waste relating to
construction  and  demolition  activities  tends to  increase  in the spring and
summer months;  and (ii) the volume of industrial and  residential  waste in the
regions where the Company  operates tends to decrease  during the winter months.
In addition,  particularly harsh weather conditions may delay the development of
landfill capacity and otherwise result in the temporary suspension of certain of
the Company's  operations and could  materially  adversely  affect the Company's
overall business, financial condition and results of operations.







                                       12

<PAGE>

Part II. Other Information

Item 6. Exhibits and Reports on Form 8-K

     a.  Financial Data Schedule (filed electronically only).

     b.  Reports on Form 8-K: The Company filed Forms 8-K on April 1, 1997 
         (Items 2, 5, 7) and May 15, 1997 (Items 2, 5, 7).




                                       13

<PAGE>



                                   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 hereunto duly authorized.

                                AMERICAN DISPOSAL SERVICES, INC.

Date: August 13, 1997           /s/ Stephen P. Lavey
                                ---------------------
                                Stephen P. Lavey
                                Vice President and Chief Financial Officer





                                       14