<PAGE>


--------------------------------------------------------------------------------

                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
--------------------------------------------------------------------------------

                                   FORM 10-QSB

             QUARTERLY REPORT PUSUANT TO SECTION 13 OR 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934
                  For the quarterly period ended April 30, 2000
            TRANSISTION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
              For the transition period from _________to _________
------------------------------------------------------------------------------

                          Commission File No. 000-20685

                             AMERICAN WAGERING, INC.
        (Exact name of small business issuer as specified in its charter)

                      Nevada                                88-0344658
         -------------------------------                -------------------
         (State or other jurisdiction of                (I.R.S. Employer
         incorporation or organization)                 Identification No.)


                    675 Grier Drive, Las Vegas, Nevada         89119
                 -----------------------------------------------------
                 (Address of principal executive offices)   (Zip Code)

                                 (702) 735-0101
                           ---------------------------
                           (Issuer's telephone number)

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

         Check whether the issuer (1) filed reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.

                               Yes___X___ No_____

The number of shares of Common Stock outstanding as of June 13, 2000 was
7,836,846




<PAGE>


Part I Financial Information

Item I Financial Statements

                             AMERICAN WAGERING, INC.
                      UNAUDITED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                              April 30          January 31
                                                                                 2000              2000
                                                                                 -----             ----
<S>                                                                            <C>               <C>
                            ASSETS
                            ------
CURRENT ASSETS:
    Cash                                                                     $  2,042,454     $  3,415,793
    Accounts receivable, net of allowance for doubtful accounts
       of $ 96,613 and $188,624                                                   701,525          686,418
    Inventories, net of obsolescence reserve of $161,370 and $161,370             280,297          436,947
    Prepaid expenses and other current assets                                     341,899          309,951
                                                                             ------------     ------------
TOTAL CURRENT ASSETS                                                            3,366,175        4,849,109

PROPERTY AND EQUIPMENT, net                                                     4,109,148        4,098,355
INTANGIBLE ASSETS, net                                                          1,122,938        1,175,637
DEPOSITS AND OTHER ASSETS                                                         614,575          605,955
                                                                             ------------     ------------
TOTAL ASSETS                                                                 $  9,212,836     $ 10,729,056
                                                                             ============     ============
LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
    Current portion of long-term debt                                         $    47,505     $     61,892
    Accounts payable                                                            1,703,323        1,703,476
    Accrued expenses                                                              982,969          988,398
    Unpaid winning tickets                                                      1,084,973        1,888,424
    Other current liabilities                                                   1,136,389        1,154,995
                                                                              -----------     ------------
TOTAL CURRENT LIABILITIES                                                       4,955,159        5,797,185
LONG-TERM DEBT, less current portion                                            1,816,517        1,816,517
MINORITY INTEREST                                                                (101,672)        (105,801)

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
   Series A Preferred stock - 10% cumulative; $100 par value;
      authorized:  25,000,000 shares; issued and
      outstanding: 15,162 and 15,424 shares                                     1,516,200        1,542,400
    Common Stock - $.01 par value; authorized: 25,000,000 shares;
       issued and outstanding: 7,836,846 and 7,824,513 shares                      78,979           78,857
    Shares to be issued in settlement of litigation - 337,500 shares            3,587,625        3,587,625
    Additional paid-in capital                                                 10,794,892       10,709,223
    Accumulated deficit                                                       (13,107,371)     (12,369,457)
    Less: treasury stock; at cost: 61,100 shares                                 (327,493)        (327,493)
                                                                            -------------     ------------
TOTAL STOCKHOLDERS' EQUITY                                                      2,542,832        3,221,155
                                                                            -------------     ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                  $   9,212,836     $ 10,729,056
                                                                            =============     ============
</TABLE>

        The accompanying notes are an integral part of these consolidated
                             financial statements.



<PAGE>


                             AMERICAN WAGERING, INC.
                 UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
               FOR THE THREE MONTHS ENDED APRIL 30, 2000 AND 1999

<TABLE>
<CAPTION>

                                                                   2000                       1999
                                                                   ----                       ----
<S>                                                       <C>                            <C>
REVENUES                                                   $      3,056,911               $   3,010,123

OPERATING COSTS AND EXPENSES:
   Direct costs                                                   2,438,417                   1,765,585
   Research and development                                         305,298                     151,381
   Selling, general and administrative                              740,380                     579,881
   Depreciation and amortization                                    228,434                     188,145
                                                              --------------            ---------------
TOTAL OPERATING COSTS AND EXPENSES                                3,712,529                   2,684,992
                                                              --------------            ---------------

OPERATING INCOME (LOSS)                                            (655,618)                    325,131

OTHER INCOME (EXPENSE):
   Interest income                                                    6,414                       7,520
   Other income                                                       3,076                        --
   Minority interest                                                 (4,129)                      5,023
   Interest expense                                                 (49,541)                    (70,494)
                                                              -------------             ---------------
TOTAL OTHER EXPENSE                                                 (44,180)                    (57,951)
                                                              --------------            ---------------

NET INCOME (LOSS)                                                  (699,798)                    267,180
PREFERRED STOCK DIVIDEND REQUIREMENTS                               (38,116)                    (15,770)
                                                              -------------             ---------------
NET INCOME (LOSS) APPLICABLE TO COMMON SHAREHOLDERS           $    (737,914)            $       251,410
                                                              =============             ===============
BASIC AND DILUTED INCOME (LOSS) PER SHARE

   Net Income (loss)                                          $       (0.09)            $          0.03
                                                              =============             ===============
</TABLE>


        The accompanying notes are an integral part of these consolidated
                             financial statements.






<PAGE>


                             AMERICAN WAGERING, INC.
                 UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
               FOR THE THREE MONTHS ENDED APRIL 30, 2000 AND 1999

<TABLE>
<CAPTION>
                                                                                          2000                      1999
                                                                                          ----                      ----
<S>                                                                                        <C>                       <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
    Net Income (Loss)                                                                   $(699,798)               $ 251,410
    Adjustments to reconcile net loss to cash used in operating activities:
    Depreciation and amortization                                                         228,434                  236,155
    Discontinued operations                                                                    --                 (145,223)
    Minority interest                                                                       4,129                   (5,023)
    Decrease (increase) in assets:
      Accounts receivable, net                                                            (15,107)                (168,122)
      Inventories                                                                         156,650                   42,638
      Prepaid expenses and other current assets                                           (31,948)                (122,175)
    Increase (decrease) in liabilities:
      Accounts payable                                                                       (153)                  59,072
      Accrued expenses                                                                     (5,429)                (314,369)
      Unpaid winning tickets                                                             (803,451)              (2,022,388)
      Other current liabilities                                                           (18,606)                 344,911
                                                                                       ----------               ----------
   Total adjustments                                                                     (485,481)              (2,094,524)
                                                                                       ----------               ----------
   Net cash used in operating activities                                               (1,185,279)              (1,843,114)
                                                                                       ----------               ----------

CASH FLOWS FROM INVESTING ACTIVITIES:
    Capital expenditures                                                                 (186,528)                 (22,865)
    Deposits and other assets                                                              (8,620)                 (33,580)
    Proceeds from sale of assets                                                               --                   40,000
    Decrease in short-term investments                                                         --                  110,570
                                                                                       ----------               ----------
    Net cash provided by (used in) investing activities                                  (195,148)                  94,125
                                                                                       ----------               ----------

CASH FLOWS FROM FINANCING ACTIVITIES:
    Stock option exercise                                                                  85,791                       --
    Repayment of long-term debt                                                           (14,387)                 (38,513)
    Redemption of preferred stock                                                         (26,200)                      --
    Preferred stock dividends                                                             (38,116)                      --
                                                                                       ----------               ----------
   Net cash provided by (used in) financing activities                                      7,088                  (38,513)
                                                                                       ----------               ----------

NET DECREASE IN CASH AND CASH EQUIVALENTS                                              (1,373,339)              (1,787,502)
CASH, beginning of period                                                               3,415,793                3,076,563
                                                                                       ----------               ----------
CASH, end of period                                                                    $2,042,454               $1,289,061
                                                                                       ==========               ==========

SUPPLEMENTAL CASH FLOW DISCLOSURE:
    Cash paid for interest                                                             $   49,541               $  142,112
                                                                                       ==========               ==========

SUPPLEMENTAL DISCLOSURES OF NON-CASH ACTIVITIES:
    None

</TABLE>



              The accompanying notes are an integral part of these
                       consolidated financial statements.


<PAGE>

                             AMERICAN WAGERING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                JANUARY 31, 2000


1.       Summary of Business and Significant Accounting Policies

         Summary of Business

         In August 1995, American Wagering, Inc., a Nevada Corporation, (the
         "Company") was formed as the holding Company for Leroy's Horse and
         Sports Place ("Leroy's") and Leroy's Hotel Corporation ("LHC").
         Immediately prior to the closing of the initial public offering by the
         Company, the stockholders of Leroy's and LHC exchanged their shares in
         those companies for shares of the Company. These transactions are
         referred to as the "Reorganization".

         Leroy's was incorporated under the laws of the State of Nevada on
         November 14, 1977. Through a central computer system located at its Las
         Vegas headquarters, Leroy's operates a statewide network of race and
         sports wagering facilities in 48 casinos. Leroy's leases the square
         footage necessary to conduct its operations at the non-Company owned
         gaming establishments. Leroy's operates its main race and sports book
         and a 5,600 square foot casino with approximately 65 electronic gaming
         devices including slot machines, video poker machines and multi-game
         video machines at the Howard Johnson Hotel on 3111 West Tropicana
         Avenue in Las Vegas, Nevada.

         The Company also owns and operates Mega$ports (ACT) Pty Ltd.
         ("Mega$ports (ACT)") located in Canberra, Australia. Mega$ports (ACT)
         is the Company's international wagering hub licensed to accept fixed
         odds and pari-mutuel interactive wagers on the Internet from patrons
         around the world except patrons located in the United States. In
         November 1998, Mega$ports (ACT) was issued a 15 year sports betting
         license from the Bookmakers Licensing Committee in the Australian
         Capital Territory ("ACT"). Mega$ports (ACT) began accepting wagers from
         non-Internet patrons within Australia in January 1999. Mega$ports (ACT)
         received regulatory approval for its Internet operations from the ACT
         and began accepting wagers on the Internet in March 1999.

         The Company owns AWI Keno, Inc. ("AWIK") which designs, installs,
         operates and maintains computerized keno systems and eventually will
         offer a progressive jackpot starting at $1 million.

         The Company also owns and operates Computerized Bookmaking Systems,
         Inc. ("CBS"). CBS designs, installs and maintains sports and race book
         equipment, software and computer systems for the sports betting - North
         America industry. In 1994, CBS signed a joint venture agreement with
         IGT for the purpose of developing and marketing a pari-mutuel sports
         system, known as MEGA$PORTS(R). MEGA$PORTS(R) offered opportunities to
         wager on the outcome of individual sports contests, events occurring
         within or during the contests, and outcomes of groups of sports
         contests On February 1, 1999, the Mega$ports joint venture agreement
         was terminated. In March 2000, the Company ceased ongoing operations of
         Mega$ports, Inc. and has notified the Nevada Gaming Control Board of
         its intent to let expire in July 2000, the Mega$ports, Inc. gaming
         license.

         On July 28, 1998, the Company acquired certain assets from Advanced
         Computer Services, Inc. ("ACS"). Two new subsidiaries, AWI Sports
         Systems, Inc. and AWI Hotel Systems, Inc. were formed to hold the
         assets acquired from ACS.

         In November 1999, the Company formed Secured Telephone Operating
         Platform, Inc. ("STOP") which designs, installs, and operates a
         telephone call identification system for its customers. The system
         determines the origin of a telephone call and accepts or rejects a call
         based on its origination. The system is used in conjunction with
         telephone account wagering within the State of Nevada.

         On April 22, 1998, the Company determined it would concentrate its
         business efforts on its core competency, sports wagering, and began
         seeking a qualified buyer for the hotel, food and beverage segment of
         the Company. On June 30, 1999, the Company finalized the sale of these
         operations and entered into a lease with the new owner to continue to
         operate the casino for up to two years. The casino serves as the
         Company's principal gaming location.
<PAGE>


         Period Results Not Indicative of the Full Year

         The results of operations for the Three Months ended April 30, 2000 are
         not necessarily indicative of the results to be expected for the full
         fiscal year.

         The accompanying unaudited consolidated financial statements do not
         include all information and disclosures required under generally
         accepted accounting principles. However, in the opinion of management,
         the accompanying financial statements contain all adjustments
         (consisting only of normal recurring adjustments) considered necessary
         to present fairly the financial position, results of operations and
         cash flows, of American Wagering, Inc., a Nevada corporation, (the
         "Company") for the periods presented. The financial statements as of
         and for the years ended January 31, 2000 and 1999 and the notes thereto
         included in the Company's Annual Report on Form 10-KSB should be read
         in conjunction with these interim financial statements.

         Earnings per Share

         The Financial Accounting Standards Board issued Statement of Financial
         Accounting Standards No. 128 -"Earnings Per Share" ("SFAS No. 128")
         which became effective for periods ending after December 15, 1997 and
         replaces historically reported earnings per share with "basic" and
         "diluted" earnings per share. Basic earnings per share is computed by
         dividing net income by the weighted average number of shares
         outstanding during the period, while diluted earnings per share
         reflects the additional dilution for all potentially dilutive
         securities, such as stock options.

         In accordance with SFAS No. 128, if potential shares outstanding would
         have an anti-dilutive effect on the diluted earnings per share
         calculation, then the shares are not included in the diluted earnings
         per share calculation. Options outstanding during the Three Months
         ending April 30, 2000 under the Company's Employee Stock Option Plan
         and its Directors Stock Option Plan were not included in the
         computation of diluted earnings per share because they were
         anti-dilutive with regard to the losses incurred by the Company for the
         three months then ended.

         The weighted-average number of common and common equivalent shares used
         in the calculation of basic and diluted earnings per share consisted of
         the following:
<TABLE>
<CAPTION>
                                                                                    Three months ended April 30,
                                                                                 -----------------------------------
                                                                                   2000                      1999
                                                                                 --------                  ---------
            <S>                                                                     <C>                        <C>
            Weighted-average common shares outstanding (used in the
            computation of basic earnings per share)                             7,832,891                 7,824,513
</TABLE>

         There were no dilutive securities for the period ended April 30, 1999.

         Principles of Consolidation

         The consolidated financial statements include the accounts of the
         Company and its subsidiaries. All signi-ficant inter-Company balances
         and transactions have been eliminated. The financial results for
         acquisitions are included in the consolidated financial statements from
         the date of acquisition. Investments in 50% or less owned joint
         ventures are accounted for under the equity method.

         Reclassifications

          Certain amounts in the 1999 consolidated financial statements have
         been reclassified to conform with the 2000 presentation. These
         reclassifications had no effect on the Company's net income.


         Concentration of Risk

         The Company derives a substantial portion of its revenues from a
         limited number of licensed race and sports books in the State of
         Nevada. Limitations on the scope of operations at such licensed race
         and sports books due to statutory or regulatory changes or
         deterioration in the general economic conditions which impact the
         gaming industry in Nevada could adversely affect the Company's
         operating results. The Company also derives a portion of its revenues
         from its Internet operations in Australia, which is susceptible to
         regulatory or economic changes, which may impact the Internet or the
         gaming industry outside of the United States.

<PAGE>
         The Company has expanded its sports wagering activities to Australia
         and is exploring other jurisdictions outside of the United States to
         expand its sports wagering and keno business lines. The level of
         customer acceptance for the Company's sports wagering and keno products
         in these new jurisdictions is undetermined. Establishing these
         operations may require initial investments of several hundred thousand
         dollars. If the required investments cannot be funded through current
         operations, the Company would have to obtain additional debt or equity
         funding. There can be no assurance that the Company would be able to
         complete such debt or equity funding or do so on terms satisfactory to
         the Company.

         The ownership and operation of casino gaming facilities, including race
         and sports books, in Nevada are subject to extensive state and local
         regulation. The Company's gaming operations are subject to the Nevada
         Gaming Control Act and the regulations promulgated thereunder,
         (hereinafter collectively referred to as the "Nevada Act") and various
         local regulations. If it were determined that the Nevada Act was
         violated by the Company or its subsidiaries the gaming licenses or
         registration held by the Company and it subsidiaries could be limited,
         conditioned, suspended or revoked subject to compliance with certain
         statutory and regulatory procedures. Limitation, conditioning or
         suspension or revocation of any gaming license may have a material
         effect on the Company's gaming operations.

         On March 22, 2000 legislation entitled the "Amateur Sports Integrity
         Act" was introduced in Congress. The general purpose of the proposed
         legislation is to prohibit wagering on games and performances at the
         Summer and Winter Olympics and on high school and college games.
         Leroy's currently accepts wagers on the Olympic and college games.
         Leroy's estimates that wagering on college sports represents
         approximately 26% of its revenues and therefore the passage of such
         legislation could have a material adverse impact upon the Company's
         wagering operations.

         On December 16, 1999, the Nevada State Gaming Control Board ("Board")
         filed a complaint for disciplinary action against American Wagering,
         Inc. relating to the operation of Mega$ports (ACT). The complaint
         alleges the Company, as a company registered with the Nevada Gaming
         Commission, engaged in an unsuitable method of operation due to the
         fact that Mega$ports (ACT) accepted a series of wagers from a patron
         who was physically located in Las Vegas, Nevada. The patron was an
         undercover agent of the Board. The Board further alleges that the
         acceptance of these wagers is a violation of both federal and Nevada
         State laws that prohibit Internet sports wagering. However, the Company
         believes a number of factual and legal defenses may be asserted against
         the claims contained in the complaint. The Company and the Board have
         been actively pursuing a settlement of the complaint, and it is hoped
         that the parties will reach a settlement to the complaint in the near
         future. Should the parties be unable to settle the complaint, a hearing
         would be held and the Commission could take disciplinary action against
         the Company in the event that the Company is unsuccessful in defending
         itself against the claim. The Company, in connection with the
         settlement discussions with the Board, is considering various
         alternatives that would be acceptable to the Board.

         In December, 1999 The Australian government released its Productivity
         Commissions report on Australia's Gambling Industries. The report made
         certain recommendations including regulation of online casinos.
         Following this report, the Senate Select Committee on Information
         Technologies issued a report entitled "NETBETS" a review of online
         gambling in Australia. The Committee made a series of proposals to
         reduce online gambling. One such proposal was to limit the expansion of
         online casinos with a moratorium on the issuance of online gaming
         licenses until consumer protection policies are implemented. The
         federal government is pursuing a total ban on Internet gambling.
         However, the states and territories in Australia are opposed to any
         limitations on issuing new online gaming licenses.

         At this time, the Company is unable to determine the effect, if any, of
         the outcome of the implementation of the recommendations made in these
         reports or whether the government will be successful in banning online
         gaming. If the federal government is successful in banning online
         gaming, such ban may have a material adverse effect on the operations
         of Mega$ports (ACT).

<PAGE>

2.       Business Segments

         The Company's primary operations are reported in the following four
         segments: wagering, casino, systems, and keno.

         The wagering segment consists of Leroy's, the licensed bookmaking
         operations with the largest number of sports books in the state of
         Nevada. As of April 30, 2000, in addition to its main location, the
         Company operated 48 race and sports books located within licensed
         gaming establishments owned by other Companies throughout the state of
         Nevada. Leroy's leases the square footage necessary to conduct its
         operations at non-Company owned establishments. Additionally, the
         wagering segment consists of Mega$ports U.S. and Mega$ports (ACT)
         operations. Mega$ports (ACT) is the Company's international wagering
         hub for Internet sports wagering. The financial records of Mega$ports
         (ACT) are maintained in Australia. Mega$ports US which offered a
         parimutual sports wagering system in the State of Nevada ceased
         operations in March 2000.


<PAGE>


         The casino segment includes a 5,600 square foot casino within the
         Howard Johnson Hotel containing approximately 65 electronic gaming
         devices including slot machines, video poker machines and multi-game
         video machines.

         The systems segment, consisting of CBS, AWISSI and AWIHSI and STOP,
         designs, sells, installs and maintains equipment, software and computer
         systems to the sports betting and hotel industries.

         The keno segment develops, sells, operates and services stand alone
         linked progressive keno games using state-of-the-art graphical
         interfaces. Keno is currently in its startup phase and has primarily
         incurred labor and marketing expenses.

         In accordance with Statement of Financial Accounting Standards No. 131
         "Disclosures about Segments of an Enterprise and Related Information",
         the following summarizes the segment information for the Company:
<TABLE>
<CAPTION>
                 Three Months
                    Ended
                   April 30       Wagering        Casino        Systems            Keno      Corporate         Total
                  ----------     ----------      --------      ----------       ---------    ---------      ----------
<S>                   <C>             <C>           <C>             <C>             <C>        <C>             <C>
Revenues            2000         $1,401,149      $169,422      $1,409,883       $  76,457      $  --        $3,056,911
                    1999          1,797,261       199,080       1,013,782              --         --         3,010,123

Research and        2000                --             --         305,298              --         --           305,298
Development         1999                --             --         151,381              --         --           151,381

Operating           2000          (122,341)        48,831         298,258        (314,776)    (565,590)       (655,618)
Income (Loss)*      1999           483,866         76,986         197,045         (66,924)    (365,842)        325,131

Capital             2000            28,317             --          12,734         146,063         (586)        186,528
Expenditures        1999            18,439             --           1,323              --        3,103          22,865

Depreciation        2000            70,261          2,083          87,338          61,290        7,462         228,434
and Amortization    1999            68,258          4,076          97,714               0       18,097         188,145

Identifiable        2000         2,213,055        290,578       4,968,837       1,039,624      700,742       9,212,836
Assets            January        3,943,317        277,607       5,070,162         931,046      506,924      10,729,056
                  31, 2000

</TABLE>

* Operating income (loss) does not include the allocation of corporate
management fees. The management fees are equal to 9.5% of each operating
Company's net operating income.




<PAGE>

Item 2.  Management's Discussion and Analysis or Plan of Operation

Results of Operations

Three Months ended April 30, 2000 compared to the Three Months ended April 30,
1999.


         Revenues for the Three Months ended April 30, 2000, were $3,056,911, an
increase of $46,788 or 1.6% from revenues of $3,010,123 for the Three Months
ended April 30, 1999. The increase was principally attributed to the additional
Systems revenues of $396,101 and Keno revenue of $76,457 which were offset by a
decrease in wagering revenues of $396,112 and casino revenues of $29,658.
Operating loss of $655,618 for the Three Months ended April 30, 2000 decreased
by $980,749 or 301.6% compared to operating income of $325,131 for the Three
Months ended April 30, 1999. This decrease was due to the additional cost of
operating Keno and increased expenses of the wagering operations. Offsetting the
operating loss was Systems operating income due to increased equipment sales.

Wagering operations

         Revenues from wagering operations were $1,401,149 for the Three Months
ended April 30, 2000, a decrease of $396,112 or 22.0% from revenues of
$1,797,261 for the Three Months ended April 30, 1999. The decrease was due to a
31.6% decrease in net win percentage (revenues divided by handle) between
quarters. The net win percentage was 5.2% for the Three Months ended April 30,
2000 compared to 7.6% for the Three Months ended April 30, 1999. Handle of
$25,908,151 for the Three Months ended April 30, 1999 increased by $3,114,812
from handle of $22,793,339 for the Three Months ended April 30, 1999. An
increase or decrease in handle is not necessarily indicative of an increase or
decrease in revenues or profits. Operating costs of $1,523,490 for the Three
Months ended April 30, 2000 increased by $210,096 from operating costs of
$1,313,394 for the Three Months ended April 30, 1999 primarily due to the
addition of Megasports (ACT) being fully operational for the Three Months ended
April 30, 2000.

Casino Operations

         Revenues from Casino operations were $169,422 for the Three Months
ended April 30, 2000, a decrease of $29,658 or 14.9% from revenues of $199,080
for the Three Months ended April 30, 1999. The decrease was principally
attributed to decreased slot play of local customers. Operating costs remained
approximately the same between fiscal quarters.

System Operations

         Revenues from Systems operations were $1,409,883 for the Three Months
ended April 30, 2000, an increase of $396,101 or 39.1% from revenues of
$1,013,782 for the Three Months ended April 30, 1999. Increased revenues of
$423,155 from CBS operations were attributed to increased equipment and ticket
paper sales. Sport Systems and Hotel Systems, which began operations in July
1998 and are partly owned, generated revenues of $55,613 primarily from
recurring maintenance billings for the Three Months ended April 30, 2000.
Operating costs of $1,092,124 for the Three Months ended April 30, 2000
increased by $275,386 or 33.7% from operating costs of $816,738 for the Three
Months ended April 30, 1999 mainly due to costs associated with new product
development and and costs associated with increased equipment sales.

Keno Operations

         Keno began operations in August 1999. During the Three Months ended
April 30, 2000 Keno generated revenue from commissions of $76,457 and incurred
costs of $410,732 which including location operating costs, labor, marketing and
professional services.

Direct Costs

         Direct costs of $2,438,417 for the Three Months ended April 30, 2000
increased by $672,832 or 38.1% from direct costs of $1,765,585 for the Three
Months ended April 30, 1999 principally due to increased costs in the wagering
operations for the addition of Megasports (ACT) Keno segment which were fully
operational for the Three Months ended April 30, 2000.


<PAGE>

Research and Development Costs

         Research and development costs of $305,298 for the Three Months ended
April 30, 2000 increased by $153,917 or 101.7% from research and development
costs of $151,381 for the Three Months ended April 30, 1999 due principally to
increased labor costs associated with new product development.

         The Company has expanded its sports wagering activities to Australia
and is exploring other jurisdictions to expand its keno business lines. The
level of customer acceptance for the Company's keno products in these new
jurisdictions is undetermined. Establishing these operations may require initial
investments of several hundred thousand dollars. If the required investments
cannot be funded through current operations, the Company would have to obtain
additional debt or equity funding. There can be no assurance that the Company
would be able to complete such debt or equity funding or do so on terms
satisfactory to the Company.

Selling, General and Administrative Costs

         Selling, general and administrative costs of $740,380 for the Three
Months ended April 30, 2000 increased $160,499 or 27.7% from $579,881 for the
Three Months ended April 30, 1999 primarily due to the addition of Keno,
Mega$ports (ACT) and STOP which were fully operational for the Three Months
ended April 30, 2000.

Net Loss

         Net loss for the Three Months ended April 30, 2000 of $699,798
decreased $966,978 or 361.9% from the Three Months ended April 30, 1999. The
unfavorable variance was due to the additional costs associated with operating
Keno and Mega$ports (ACT) which were fully operational for the Three Months
ended April 30, 2000.

Liquidity and Capital Resources

         Working capital decreased $640,908 from $36,167 for the Three months
ended April 30, 2000. Cash used in operating activities was $1,185,279 for the
Three Months ended April 30, 2000 compared to cash used in operating activities
of $1,843,114 for the Three Months ended April 30, 1999. Net cash used in
investing activities was $195,148 for the Three Months ended April 30, 2000
compared to cash provided by investing activities of $94,125 for the Three
Months ended April 30, 1999. Net cash provided by financing activities amounted
to $7,088 for the Three Months ended April 30, 2000 compared to net cash used in
financing activities of $38,513 for the Three Months ended April 30, 1999.

         While management believes that the Company will be able to satisfy its
operating cash requirements for at least the next 12 months from existing cash
balances and anticipated cash flows, these requirements may necessitate
curtailment of certain capital expenditures and reduction in staffing levels.
The uncertainty created by proposed legislation which could ban wagering on
amateur athletic events requires the Company to research the sources of its
future revenue growth. As described in the Company's annual report on Form
10-KSB for the year ended January 31, 2000, the Company is in the process of
reviewing various programs in fiscal year 2001 aimed at building cash liquidity
which can be used to fund working capital requirements.

         The Company has expanded its sports wagering activities to Australia
and is exploring other jurisdictions to expand its keno business lines. The
level of customer acceptance for the Company's keno products in these new
jurisdictions is undetermined. Establishing these operations may require initial
investments of several hundred thousand dollars. If the required investments
cannot be funded through current operations, the Company would have to obtain
additional debt or equity funding. There can be no assurance that the Company
would be able to complete such debt or equity funding or do so on terms
satisfactory to the Company.

Forward-Looking Statements

         Certain information included in this report and other materials filed
or to be filed by the Company with the Securities and Exchange Commission (as
well as information included in oral statements or written statements made or to
be made by the Company) contains statements that are forward-looking within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. Such statements include
information relating to current expansion projects, plans for future expansion
projects and other business development activities as well as other capital
spending, financing sources, Year 2001 compliance and the effects of regulation
(including gaming and tax regulation) and competition. Such forward-looking
information involves important risks and uncertainties that could significantly
affect anticipated results in the future and, accordingly, such results may
differ from those expressed in any forward-looking statements made by or on
behalf of the Company. These risks and uncertainties include, but are not
limited to, those relating to the Company taking financial risks on the outcome
of sports events as a principal betting against its patrons, domestic or global
economic conditions, changes in federal or state tax laws or the administration
of such laws, changes in gaming laws or regulations (including the legalization
of gaming in certain jurisdictions) and applications for licenses and approvals
under applicable laws and regulations (including gaming laws and regulations).

<PAGE>

PART II        OTHER INFORMATION

Item 1.        LEGAL PROCEEDINGS - See the description of these legal
               proceedings set forth in the Registrant's Form 10-KSB for the
               year ended January 31, 2000.

Item 2.        CHANGES IN SECURITIES - NON APPLICABLE

Item 3.        DEFAULTS UPON SENIOR SECURITIES - NON APPLICABLE

Item 4.        SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS -
               NON APPLICABLE

Item 5.        OTHER INFORMATION - NON APPLICABLE

Item 6.        EXHIBITS AND REPORTS ON FORM 8-K

               Exhibits - Financial Data Schedule

Number                       Description                       Method of Filing
------                       -----------                       ----------------

  27                   Financial Data Schedule                  Filed Herewith

(b) The following report on Form 8-K was filed during the quarter ended April
    30, 2000:
               NONE



                                   SIGNATURES


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 hereunto duly authorized.

                                                    AMERICAN WAGERING, INC.


                                                            (Registrant)

Date:  June 14, 2000                                By: /s/ Robert D. Ciunci
                                                    ----------------------------
                                                    Robert D. Ciunci
                                                    Executive Vice President and
                                                    Chief Financial Officer