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 quarterly period ended March 31, 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 0-28208

                       APPLIED GRAPHICS TECHNOLOGIES, INC.
             (Exact name of Registrant as specified in its charter)


         DELAWARE                                            13-3864004
(State or other jurisdiction of                           (I.R.S. Employer
   incorporation or organization)                         Identification No.)



                               28 WEST 23RD STREET
                                  NEW YORK, NY
                    (Address of principal executive offices)
                                      10010
                                   (Zip Code)

                                  212-929-4111
              (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  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 the registrant's common stock outstanding as of May
9, 1997, was 14,349,683.



<PAGE>


                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements


                       APPLIED GRAPHICS TECHNOLOGIES, INC.
                                 BALANCE SHEETS
                                   (Unaudited)
                 (In thousands of dollars, except share amounts)


                                                       March 31,  December 31,
                                                         1997        1996
                                                     ------------ ------------
ASSETS
Current assets:
Cash and cash equivalents .........................      $ 2,540     $ 2,567
Marketable securities at cost .....................                    1,600
Trade accounts receivable
 (net of allowances of $456
   in 1997 and $472 in 1996) ......................       31,482      29,584
Due from affiliates ...............................        2,324
Inventory .........................................        4,454       4,639
Deferred income taxes .............................          752         705
Prepaid expenses and other current assets .........        2,495       2,485
                                                         -------     -------
          Total current assets ....................       44,047      41,580

Property, plant, and equipment - net ..............       19,794      20,544
Goodwill ..........................................        7,426       7,121
Deferred income taxes .............................        1,811       1,644
Other assets ......................................        1,326       1,258
                                                         -------     -------

          Total assets ............................      $74,404     $72,147
                                                         =======     =======

LIABILITIES AND STOCKHOLDERS' EQUITY 
Current liabilities:
Accounts payable and accrued expenses .............      $19,884     $19,630
Applied Printing Note .............................                    1,600
Current portion of long-term debt .................          144         507
Current portion of obligations
  under capital leases ............................        1,217       1,354
Due to affiliates .................................        1,926         354
Other current liabilities .........................        2,076       2,407
                                                         -------     -------
   Total current liabilities ......................       25,247      25,852

Long-term debt ....................................        6,662       6,005
Obligations under capital leases ..................        1,026       1,265
Other liabilities .................................        2,988       3,142
                                                         -------     -------
   Total liabilities ..............................       35,923      36,264
                                                         -------     -------
Commitments and contingencies
STOCKHOLDERS' EQUITY
Preferred stock  (no par value, 10,000,000
 shares authorized; no shares
  issued and outstanding)
Common stock (par value $0.01; 40,000,000
  shares authorized; 14,349,683 shares
     issued and outstanding) ......................          143         143
Additional paid-in capital ........................       25,584      25,584
Retained earnings .................................       12,754      10,156
                                                         -------     -------
   Total stockholders' equity .....................       38,481      35,883
                                                         -------     -------

   Total liabilities and stockholders' equity .....      $74,404     $72,147
                                                         =======     =======

                    See Notes to Interim Financial Statements
<PAGE>

                       APPLIED GRAPHICS TECHNOLOGIES, INC.
                            STATEMENTS OF OPERATIONS
                                   (Unaudited)
                    ( In thousands, except per-share amounts)



                                                   For the Three Months Ended
                                                            March 31,
                                                   --------------------------
                                                           1997        1996
                                                         --------    --------

Revenues ...........................................     $ 39,761    $ 30,598
Cost of revenues ...................................       26,821      22,329
                                                         --------    --------

Gross profit .......................................       12,940       8,269
Selling, general, and
    administrative expenses ........................        8,602       7,056
                                                         --------    --------

Operating income ...................................        4,338       1,213
Interest expense ...................................         (210)       (904)
Other income (expense) - net .......................          131        (163)
                                                         --------    --------

Income before provision for
    income taxes ...................................        4,259         146

Provision for income taxes .........................        1,661
                                                         --------    --------

Net income .........................................     $  2,598    $    146
                                                         ========    ========

Earnings per common share (pro forma in 1996):
Primary ............................................     $   0.17    $   0.01
Fully Diluted ......................................     $   0.17    $   0.01

Weighted average number of common shares
 (pro forma in 1996):
Primary ............................................       15,171       9,775
Fully Diluted ......................................       15,309       9,775

















                    See Notes to Interim Financial Statements
<PAGE>

                       APPLIED GRAPHICS TECHNOLOGIES, INC.
                            STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                            (In thousands of dollars)

                                                   For the Three Months Ended
                                                           March 31,
                                                   --------------------------
                                                            1997        1996
                                                         -------     -------
Cash flows from operating activities:
Net income .........................................     $ 2,598     $   146
Adjustments to reconcile net income to
 net cash from operating activities:
    Depreciation and amortization ..................       1,388       1,347
    Deferred taxes .................................        (214)
    Other ..........................................        (208)        154
Management of Changes in Operating
 Assets and Liabilities:
    Trade accounts receivable ......................      (1,882)     (2,623)
    Due from/to affiliates .........................        (752)      4,099
    Inventory ......................................         185         261
    Other assets ...................................         (95)       (300)
    Accounts payable and accrued expenses ..........         254       3,561
    Other liabilities ..............................        (596)      2,233
                                                         -------     -------
Net cash provided by operating activities ..........         678       8,878
                                                         -------     -------

Cash flows from investing activities:
    Proceeds from the sale of marketable securities        1,600
    Property, plant, and equipment expenditures ....      (1,769)     (1,650)
    Proceeds from the sale of fixed assets .........                     291
    Net proceeds from insurance claims .............                     243
                                                         -------     -------
Net cash used in investing activities ..............        (169)     (1,116)
                                                         -------     -------

Cash flows from financing activities:
    Borrowings under revolving credit line .........         694
    Proceeds from sale/leaseback transactions ......       1,030
    Repayment of Applied Printing Note .............      (1,600)
    Repayment of notes and capital lease obligations        (660)       (600)
    Repayment of intercompany borrowings - net .....                  (1,650)
    Net distributions to Applied Printing ..........                  (6,178)
                                                         -------     -------
Net cash used in financing activities ..............        (536)     (8,428)
                                                         -------     -------

Net decrease in cash and cash equivalents ..........         (27)       (666)
Cash and cash equivalents at beginning of period ...       2,567         666
                                                         -------     -------

Cash and cash equivalents at end of period .........     $ 2,540     $     0
                                                         =======     =======

Supplemental Disclosure of Cash Flow Information:
Interest paid ......................................     $   231     $   134
Income taxes paid ..................................     $ 2,560








                    See Notes to Interim Financial Statements
<PAGE>

                       APPLIED GRAPHICS TECHNOLOGIES, INC.
                      NOTES TO INTERIM FINANCIAL STATEMENTS


1.  BASIS OF PRESENTATION

     The  accompanying  unaudited  condensed  financial  statements  of  Applied
Graphics  Technologies,  Inc.  (the  "Company"),  which  have been  prepared  in
accordance with the instructions to Form 10-Q and, therefore, do not include all
information  and  footnotes  necessary  for a  fair  presentation  of  financial
position,  results of  operations,  and cash flows in conformity  with generally
accepted accounting principles,  should be read in conjunction with the notes to
financial  statements  contained in the Company's 1996 Form 10-K. In the opinion
of the  management  of the Company,  all  adjustments  (consisting  primarily of
normal recurring  accruals) necessary for a fair presentation have been included
in the financial statements.

     On April  16,  1996  (the  "Offering  Date"),  the  Company's  Registration
Statement on Form S-1 under the Securities Act of 1933, as amended,  relating to
the initial public offering (the  "Offering") of the Company's Common Stock, was
declared  effective.  Upon the offering  being declared  effective,  the Company
acquired  substantially  all of  the  assets  and  certain  related  liabilities
relating to the  prepress,  digital  imaging  services,  and related  businesses
(collectively,  the "Prepress Business") of Applied Printing Technologies,  L.P.
("Applied Printing"),  an entity beneficially owned by the Chairman of the Board
of Directors of the Company and the Chief Executive Officer of the Company.  The
Prepress Business was acquired in exchange for 9,309,900 shares of the Company's
Common Stock and  $37,000,000 of additional  consideration  comprised of (i) the
assumption  by the  Company of the  principal  amount of  collateralized  senior
indebtedness   to  Applied   Printing's   primary   institutional   lender  (the
"Institutional  Senior  Indebtedness") of $21,000,000 and (ii) the issuance of a
promissory note by the Company to Applied Printing (the "Applied Printing Note")
of  $16,000,000.  The Company  received  net  proceeds of  $46,103,000  from the
Offering,   of  which  $21,000,000  was  used  to  repay  Institutional   Senior
Indebtedness  and  $16,000,000  was used to invest in short-term  investments to
support a standby  letter of credit that  collateralized  the  Applied  Printing
Note.

     The  acquisition  of the Prepress  Business was  accounted  for in a manner
similar to a pooling of interests.  Accordingly, the financial statements of the
Company  reflect the combined  results of  operations  of the Prepress  Business
through  the  Offering  Date and the  results  of the  Company  thereafter.  The
statement  of  operations  and the  statement of cash flows for the three months
ended March 31, 1996,  have been prepared by combining the results of operations
and cash flows of the specific  divisions that comprised the Prepress  Business.
Prior to the Offering Date, these divisions  operated as separate business units
and maintained their own books and records.  Through the Offering Date,  Applied
Printing  managed the cash and  financing  requirements  of all of its divisions
centrally and, as such, the interest expense and related intercompany  borrowing
up until that date  represents  an  allocation  of Applied  Printing's  interest
expense and the related debt. Additionally,  prior to the Offering Date, Applied
Printing and other related parties had provided certain corporate,  general, and
administrative  services to the Prepress Business including general  management,
treasury,  financial reporting, and legal services.  Accordingly,  the financial
statements prior to the Offering Date include an allocation of expenses for such
services.  The results of  operations  and cash flows for the three months ended
March 31, 1996,  may have  differed had the Company  operated as an  independent
entity during that period.

     Certain prior-period amounts in the accompanying  financial statements have
been reclassified to conform with the 1997 presentation.

<PAGE>

2.  ACCOUNTING PRONOUNCEMENTS

     Statement of Financial  Accounting  Standards (SFAS) No. 128, "Earnings per
Share",  was issued in  February  1997 and is  effective  for interim and annual
periods  ending after  December  15,  1997.  This  statement,  which  supersedes
Accounting  Principles Board Opinion No. 15,  "Earnings per Share",  establishes
standards for computing and  presenting  earnings per share and will require the
restatement of all prior-period  earnings per share data. The  implementation of
SFAS No. 128 will not have a material impact on the Company's earnings per share
data.



     Statement of Financial  Accounting Standards (SFAS) No. 129, "Disclosure of
Information  about  Capital  Structure",  was  issued  in  February  1997 and is
effective for periods ending after December 15, 1997. This statement establishes
standards for  disclosing  information  about an entity's  capital  structure by
superseding  and  consolidating  previously  issued  accounting  standards.  The
financial  statements  of the  Company  are  prepared  in  accordance  with  the
requirements of SFAS No. 129.


3.  INVENTORY

    The components of inventory (in thousands of dollars) were as follows:

                                                       March 31,  December 31,
                                                         1997        1996
                                                     ------------ ------------

Work-in-process ....................................     $ 2,826     $ 2,596
Raw materials ......................................       1,628       2,043
                                                         -------     -------

Total ..............................................     $ 4,454     $ 4,639
                                                         =======     =======

4.  INCOME TAXES

     The Prepress  Business was treated as a  partnership  for Federal and state
income  tax  purposes  prior to the  Offering  Date and was not  subject to tax.
Concurrently with the acquisition,  the Company recorded the applicable deferred
tax assets related to the differences  between financial statement and tax basis
of the assets and  liabilities  of the  Prepress  Business.  These  deferred tax
assets were  entirely  offset by a valuation  allowance.  A provision for income
taxes is included in the Company's  Statement of Operations only for the periods
subsequent  to the Offering  Date.  Had the Company been subject to income taxes
prior to the Offering  Date,  the provision for income  taxes,  net income,  and
earnings per share for the three  months  ended March 31, 1996,  would have been
$29,000, $117,000, and $0.01, respectively.  The effective rate of the provision
for  income  taxes in 1996 was lower  than  would  ordinarily  be  expected  due
primarily to the reversal of both Federal and state deferred tax asset valuation
allowances.

5.  EARNINGS PER SHARE

     Earnings  per share of common  stock are computed by dividing net income by
the  weighted  average of the number of shares of common  stock and common stock
equivalents outstanding. For the 1996 period, earnings per share of common stock
represent  a pro forma  calculation  using the number of shares of common  stock
issued and issuable to Applied Printing at March 31, 1996.

6.  RELATED PARTY TRANSACTIONS

     Sales to, purchases from, and administrative  charges incurred with related
parties  during the three months ended March 31, 1997 and 1996 (in  thousands of
dollars), were as follows:

                                                          1997        1996
                                                       ----------  ----------
Affiliate sales ....................................     $ 3,176     $ 3,020
Affiliate purchases ................................     $ 1,439     $   492
Administrative charges .............................     $   265     $ 1,302


     Administrative  charges  include  charges  for certain  legal and  computer
services   provided  by  affiliates  and  for  rent  incurred  for  leases  with
affiliates. Administrative charges incurred for the three months ended March 31,
1996,  also include  $1,232,000  of costs  allocated  from Applied  Printing for
general management,  treasury,  financial  reporting,  and legal services.  Such
administrative  charges are included in selling and  administrative  expenses in
the Statements of Operations.

<PAGE>


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


     Certain  statements  made  in  this  Quarterly  Report  on  Form  10-Q  are
"forward-looking"  statements  (within  the  meaning of the  Private  Securities
Litigation Reform Act of 1995). Such statements involve known and unknown risks,
uncertainties,  and other factors that may cause actual results, performance, or
achievements of the Company to be materially  different from any future results,
performance,  or  achievements  expressed  or  implied  by such  forward-looking
statements.  Although the Company  believes that the  expectations  reflected in
such  forward-looking  statements  are based upon  reasonable  assumptions,  the
Company's  actual  results could differ  materially  from those set forth in the
forward-looking  statements.  Certain factors that might cause such a difference
include the following: an inability to obtain additional,  or to renew existing,
on-site  arrangements;  a delay in commencing to provide  services under the new
agreement with General Motors;  an inability to expand the services  provided by
the digital division;  an inability to enter into acquisitions;  or an inability
to obtain additional credit or financing sources.

     On April 16, 1996 (the "Offering Date"),  the Company commenced the initial
public  offering  (the  "Offering")  of its Common  Stock.  Concurrent  with the
Offering,  the  Company  acquired  substantially  all of the assets and  certain
liabilities  relating to the prepress,  digital  imaging  services,  and related
businesses of Applied Printing Technologies,  L.P. (collectively,  the "Prepress
Business"). The acquisition of the Prepress Business has been accounted for in a
manner similar to a pooling of interests.  Accordingly, the financial statements
of the Company  reflect  the  combined  results of  operations  of the  Prepress
Business through the Offering Date and the results of the Company thereafter.

Results of Operations
Three months ended March 31, 1997, compared with 1996

     Revenues  in the first  quarter of 1997 were $9.2  million or 29.9%  higher
than in the comparable  period in 1996.  This increase was primarily due to $3.7
million  of  revenues  generated  from  the  operations  of  additional  on-site
facilities management contracts during the 1997 period, $1.6 million of revenues
from the  SpotLink  division  whose dub and ship  operations  were  acquired  in
December  1996,  increased  revenues  of $0.7  million  in the  digital  imaging
services  division from  equipment  sales,  $1.4 million of  additional  revenue
generated in certain divisions of the traditional  prepress business,  primarily
at the  Carlstadt  facility,  $0.5  million  of revenue  from the ad  management
business  that had not yet  commenced  operations  during the 1996  period,  and
receipt of a nonrefundable  payment of $2.0 million related to an agreement with
one of the Company's  major  suppliers.  These revenue  increases  were slightly
offset by a decrease  in sales of $0.7  million at the Los  Angeles  and Burbank
divisions as a result of combining these operations as discussed below.

     In March 1997, the Company signed a contract to be the primary  provider of
digital prepress  production  services and distribution and warehousing of radio
and television  commercials for General Motors.  Under this long-term  contract,
which  initially runs through August 2000 and is renewable for an additional two
years at General  Motors'  option,  the Company will  consolidate all activities
relating to the use of General  Motors' visual content,  including  photographic
images and audio and video  commercials.  The Company expects to begin providing
significant services under this contract in the second half of 1997.

     Gross profit  increased  $4.7 million or 56.5% in the first quarter of 1997
as a result of the additional  revenues for the period as discussed above.  This
increase was  partially  offset by the lower gross profit at the Los Angeles and
Burbank divisions of the traditional  prepress business resulting from decreased
sales along with expenses  incurred and  inefficiencies  encountered  during the
transition  period to combine the Burbank  facility into the recently  completed
Los Angeles facility.  The Company expects the combining of these two facilities
to provide greater capacity and more efficient  operating results in the future.
The gross profit  percentage  in the first quarter of 1997 was 32.5% as compared
to 27.0% in the 1996 period.

     Selling,  general, and administrative expenses in the first quarter of 1997
were $1.5 million  higher than in the first quarter of 1996, but as a percent of
revenue  decreased  to 21.6% in the 1997 period  from 23.1% in the 1996  period.
This  improvement is primarily due to the increase in revenues  discussed  above
and  increased  business from on-site  facilities  management  contracts,  which
require  less  sales  support  than  the  traditional  prepress  business.  Such
improvements  were partially offset by additional  expenses  incurred related to
being a publicly-traded company and from expanded business at certain operations
as well as expenses  incurred to combine the  operations  of the Los Angeles and
Burbank divisions.

     Interest expense in the first quarter of 1997 was $0.7 million less than in
the 1996 period  primarily  due to the  repayment of debt in April 1996 with the
proceeds from the Offering.

     The Prepress  Business was treated as a  partnership  for Federal and state
income  tax  purposes  prior to the  Offering  Date and was not  subject to tax.
Concurrently with the acquisition,  the Company recorded the applicable deferred
tax assets related to the differences  between financial statement and tax basis
of the assets and  liabilities  of the  Prepress  Business.  These  deferred tax
assets were  entirely  offset by a valuation  allowance.  A provision for income
taxes is included in the Company's  Statement of Operations only for the periods
subsequent  to the Offering  Date.  Had the Company been subject to income taxes
prior to the Offering  Date,  the provision for income  taxes,  net income,  and
earnings per share for the three  months  ended March 31, 1996,  would have been
$29,000, $117,000, and $0.01, respectively.  The effective rate of the provision
for  income  taxes in 1996 was lower  than  would  ordinarily  be  expected  due
primarily to the reversal of both Federal and state deferred tax asset valuation
allowances.

     Statement of Financial  Accounting  Standards (SFAS) No. 128, "Earnings per
Share",  was issued in  February  1997 and is  effective  for interim and annual
periods  ending after  December  15,  1997.  This  statement,  which  supersedes
Accounting  Principles Board Opinion No. 15,  "Earnings per Share",  establishes
standards for computing and  presenting  earnings per share and will require the
restatement of all prior-period  earnings per share data. The  implementation of
SFAS No. 128 will not have a material impact on the Company's earnings per share
data.

     Statement of Financial  Accounting Standards (SFAS) No. 129, "Disclosure of
Information  about  Capital  Structure",  was  issued  in  February  1997 and is
effective for periods ending after December 15, 1997. This statement establishes
standards for  disclosing  information  about an entity's  capital  structure by
superseding  and  consolidating  previously  issued  accounting  standards.  The
financial  statements  of the  Company  are  prepared  in  accordance  with  the
requirements of SFAS No. 129.

Financial Condition

     During the first quarter of 1997,  the Company  repaid the  remaining  $1.6
million  of the  Applied  Printing  Note  with  the  proceeds  from  the sale of
marketable  securities.  In March  1997,  the  Company  entered  into a sale and
leaseback  arrangement that generated proceeds of $1.0 million. Such arrangement
did not result in any gain or loss. In May 1997,  the Company  renegotiated  the
terms under its  revolving  line of credit.  The revised line of credit is a $25
million variable-rate facility with a term that runs through May 2000. Under the
revised facility, interest on funds borrowed is either prime less 0.75% or LIBOR
plus 1.50%.  As of March  31,1997,  $6.3 million was borrowed under this line of
credit.

     Cash  flows from  operating  activities  during  the first  quarter of 1997
decreased by $8.2 million  dollars as compared to the comparable  period in 1996
due primarily to the improved financial  condition of the Company enabling it to
accelerate payments to vendors and affiliates. During the first quarter of 1997,
the Company  invested  $1.8 million in equipment and repaid $0.7 million of debt
and lease  obligations with the proceeds from a sale and leaseback  transaction,
additional  borrowings under its line of credit,  and cash provided by operating
activities.

     At March 31, 1997,  capital  commitments  amounted to  approximately  $11.0
million,  essentially  all of which is for  investment in production  equipment,
including a $6.5 million capital  investment the Company expects to make through
1998 in connection  with the General  Motors  contract.  The Company  intends to
finance a substantial  portion of these  expenditures  under operating leases or
sale and leaseback arrangements.

     The Company  believes  that the cash flow from  operations,  its  revolving
credit  facility,  and its  potential  ability  to  obtain  funding  from  other
financing  sources will be sufficient to fund its cash needs for the foreseeable
future.



Item 3.  Quantitative and Qualitative Disclosures About Market Risk.


    Not applicable.


<PAGE>

                          PART II. - OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K

     (a)  Exhibits:


     3.1       Certificate  of  Incorporation   (Incorporated  by  reference  to
               Exhibit No. 3.1  forming  part of the  Registrant's  Registration
               Statement  on Form  S-1  (File  No.  333-00478)  filed  with  the
               Securities  and Exchange  Commission  under the Securities Act of
               1933, as amended).

     3.2       Amended and Restated  By-Laws of Applied  Graphics  Technologies,
               Inc.  (Incorporated  by reference to Exhibit No. 3.2 forming part
               of Amendment No. 3 to the Registrant's  Registration Statement on
               Form S-1 (File  No.  333-00478)  filed  with the  Securities  and
               Exchange   Commission  under  the  Securities  Act  of  1933,  as
               amended).

     4         Specimen Stock Certificate  (Incorporated by reference to Exhibit
               No.  4  forming  part  of  Amendment  No.  3 to the  Registrant's
               Registration  Statement  on Form S-1 (File No.  333-00478)  filed
               with the Securities and Exchange  Commission under the Securities
               Act of 1933, as amended).

     10.2      Applied  Graphics  Technologies,  Inc.  1996  Stock  Option  Plan
               (Incorporated  by  reference  to Exhibit No. 10.2 forming part of
               Amendment  No. 3 to the  Registrant's  Registration  Statement on
               Form S-1 (File  No.  333-00478)  filed  with the  Securities  and
               Exchange   Commission  under  the  Securities  Act  of  1933,  as
               amended).

     10.3      Applied  Graphics   Technologies,   Inc.  Non-Employee  Directors
               Nonqualified  Stock  Option Plan  (Incorporated  by  reference to
               Exhibit  No.  10.3  forming  part  of  Amendment  No.  3  to  the
               Registrant's   Registration  Statement  on  Form  S-1  (File  No.
               333-00478)  filed with the  Securities  and  Exchange  Commission
               under the Securities Act of 1933, as amended).

     10.4*     Loan and Purchase  Agreement,  dated  January 8, 1992, as amended
               (Incorporated  by  reference  to Exhibit No. 10.4 forming part of
               Amendment  No. 3 to the  Registrant's  Registration  Statement on
               Form S-1 (File  No.  333-00478)  filed  with the  Securities  and
               Exchange   Commission  under  the  Securities  Act  of  1933,  as
               amended).

     10.4(a)*  Second  Amendment to Loan and Purchase  Agreement dated April 19,
               1996  (Incorporated by reference to Exhibit No. 10.1 forming part
               of the  Registrant's  Report on Form  10-Q/A  (File No.  0-28208)
               filed  with the  Securities  and  Exchange  Commission  under the
               Securities  Exchange Act of 1934,  as amended,  for the quarterly
               period ended March 31, 1996).

     10.5      Agreement,  dated  May  1,  1979,  between  WAMM  Associates  and
               Publisher Phototype International, L.P., as amended (Incorporated
               by reference to Exhibit No. 10.5 forming part of Amendment  No. 1
               to the Registrant's  Registration Statement on Form S-1 (File No.
               333-00478)  filed with the  Securities  and  Exchange  Commission
               under the Securities Act of 1933, as amended).

<PAGE>


     10.6(a)   Employment Agreement,  effective as of April 1, 1996, between the
               Company and Diane  Romano  (Incorporated  by reference to Exhibit
               No. 10.6  forming  part of  Amendment  No. 3 to the  Registrant's
               Registration  Statement  on Form S-1 (File No.  333-00478)  filed
               with the Securities and Exchange  Commission under the Securities
               Act of 1933, as amended).

     10.6(b)   Employment Agreement,  effective as of April 1, 1996, between the
               Company and  Georgia L.  McCabe  (Incorporated  by  reference  to
               Exhibit  No.  10.6  forming  part  of  Amendment  No.  3  to  the
               Registrant's   Registration  Statement  on  Form  S-1  (File  No.
               333-00478)  filed with the  Securities  and  Exchange  Commission
               under the Securities Act of 1933, as amended).

     10.6(c)   Employment Agreement, effective as of March 13, 1996, between the
               Company and Melvin A.  Ettinger  (Incorporated  by  reference  to
               Exhibit  No.  10.6  forming  part  of  Amendment  No.  3  to  the
               Registrant's   Registration  Statement  on  Form  S-1  (File  No.
               333-00478)  filed with the  Securities  and  Exchange  Commission
               under the Securities Act of 1933, as amended).

     10.6(d)   Employment Agreement,  effective as of April 1, 1996, between the
               Company and Scott A.  Brownstein  (Incorporated  by  reference to
               Exhibit  No.  10.6  forming  part  of  Amendment  No.  3  to  the
               Registrant's   Registration  Statement  on  Form  S-1  (File  No.
               333-00478)  filed with the  Securities  and  Exchange  Commission
               under the Securities Act of 1933, as amended).

     10.6(e)   Employment  Agreement,  effective as of June 1, 1996, between the
               Company and Louis Salamone, Jr.

     10.7      Form of Registration Rights Agreement  (Incorporated by reference
               to  Exhibit  No.  10.7  forming  part of  Amendment  No. 3 to the
               Registrant's   Registration  Statement  on  Form  S-1  (File  No.
               333-00478)  filed with the  Securities  and  Exchange  Commission
               under the Securities Act of 1933, as amended).

     27        Financial Data Schedule (EDGAR filing only).

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

*  Confidential portions omitted and supplied separately to the Securities
    and Exchange Commission.

     (b)   The  Registrant  did not file any  reports  on Form  8-K  during  the
           quarter ended March 31, 1997.



<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 thereunto duly authorized.

                                             APPLIED GRAPHICS TECHNOLOGIES, INC.
                                                                    (Registrant)


                                                      By: /s/ Melvin A. Ettinger
Date: May 15, 1997
                                                   -----------------------------
                                                              Melvin A. Ettinger
                                          Vice Chairman, Chief Operating Officer
                                             and Director
                                                       (Duly authorized officer)


                                                         /s/ Louis Salamone, Jr.
Date: May 15, 1997
                                                   -----------------------------
                                                             Louis Salamone, Jr.
                                                       Senior Vice President and
                                                        Chief Financial Officer
                                                   (Principal Financial Officer)